Robinhood's first-quarter earnings report fell short of expectations, with the company posting adjusted earnings per share of $0.38, below the estimated $0.39, and total revenue of $1.07 billion, missing the predicted $1.14 billion. The trading platform's shares subsequently dropped 8% in post-market trading. A significant decline in crypto-related revenue, which decreased by 47% to $134 million from $252 million in the previous year, was a major contributor to the disappointing earnings.
However, the company saw growth in other areas, including a 320% year-over-year increase in 'other transaction revenue' to $147 million, driven by a record 8.8 billion contracts traded in prediction markets. CEO Vlad Tenev emphasized the company's focus on utilizing crypto technology as infrastructure for financial services, rather than relying on crypto price cycles. The results reflect a shift in customer usage, with more consistent engagement across asset classes.
Robinhood is expanding into areas such as prediction markets, derivatives, and advisory tools to reduce its dependence on crypto trading. The company also reported gains in net interest revenue and subscriptions, including its Gold tier, as it builds out a broader financial services platform.