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 projected $1.14 billion. The trading platform's stock price dropped approximately 8% in post-market trading.
Cryptocurrency-related revenue, a key driver of the company's transactions, plummeted 47% to $134 million from $252 million in the previous year. However, the decline was offset by 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 cryptocurrency 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 like prediction markets, derivatives, and advisory tools to reduce its dependence on cryptocurrency trading and smooth out revenue fluctuations. The company also reported gains in net interest revenue and subscriptions, including its Gold tier, as it builds a broader financial services platform. Tenev expressed optimism about the long-term potential of cryptocurrency, citing the beginning of a 'tokenization super cycle' and efforts to bring assets like stocks onto blockchain rails.