Robinhood Shares Slide on 34% Decrease in Crypto Revenue

Robinhood reported its smallest quarterly nett successful a twelvemonth connected Tuesday, highlighting the retail brokerage’s lingering vulnerability to retail traders whose engagement has shown signs of cooling alongside a crisp downturn successful cryptocurrency prices.

The institution disclosed a first-quarter nett of $346 million, oregon $0.38 per share, compared to $336 cardinal a twelvemonth ago. Representing a 3% year-over-year increase, the show fell somewhat abbreviated of analysts’ expectations of a $0.39 summation per stock for the firm.

Robinhood indicated that gross clocked successful astatine $1.07 billion, a show that the institution attributed to “double-digit maturation crossed equities and options, and grounds volumes for prediction markets, futures, and scale options” successful an announcement. Analysts had expected the institution that offers commission-free banal and crypto trading to station $1.14 cardinal successful revenue.

In after-hours trading, Robinhood’s shares fell 6% to $82, according to Yahoo Finance. Last year, the Menlo Park, California-based steadfast benefited from a booming crypto market, with its banal terms peaking alongside Bitcoin astatine an all-time precocious of $153.86 successful October.

“Robinhood is progressively positioned astatine the halfway of our customers’ fiscal lives,” Chairman and CEO Vlad Tenev said successful a statement.

The institution disclosed $134 cardinal successful first-quarter gross from crypto transactions, marking a 34% decrease from $221 cardinal the erstwhile quarter. In the 3 months ended March 31, Bitcoin’s terms fell 22%, paralleling declines for the erstwhile period, according to CoinGlass.

Not agelong aft Robinhood began providing users entree to Kalshi-powered prediction markets, analysts identified wagers connected sports arsenic a tailwind for the firm. The institution indicated that its users continued to clasp the offering, reporting grounds volumes.

Although Robinhood popularized a commission-free exemplary among retail traders, it charges customers a one-cent interest connected transactions involving prediction markets. In January, Robinhood began rolling out entree to “custom combos,” which reflector sportsbook parlays.

The institution reported $307 cardinal successful full level assets, a sequential alteration from $324 cardinal precocious past year. On a year-over-year basis, Robinhood said the metric had accrued 39%, partially driven by continued nett deposits and higher equity valuations.

Robinhood noted that the institution debuted its nationalist testnet for Robinhood Chain, an Ethereum layer-2 scaling network, successful the archetypal quarter. The steadfast described those efforts arsenic portion of its attack to creating a “global fiscal ecosystem” for tokenized assets.

Since the steadfast began offering customers successful Europe entree to integer representations of companies similar OpenAI and SpaceX, Robinhood reported that its associated offering has already processed implicit 100 cardinal transactions.