Robinhood's first-quarter earnings report revealed a substantial decline in cryptocurrency trading revenue, which plummeted 47% to $134 million, while the company's overall revenue saw a 15% year-over-year increase to $1.07 billion. The trading platform's adjusted earnings per share of $0.38 fell short of Wall Street's estimate of $0.39.
As a result, shares dropped approximately 8% in post-market trading. The company is attempting to shift its focus away from cryptocurrency price cycles, with CEO Vlad Tenev emphasizing the use of crypto technology as 'infrastructure' for financial services. Meanwhile, transaction-based revenue rose to $623 million, driven by growth in newer products, and 'other transaction revenue' surged 320% year over year to $147 million, fueled by a record 8.8 billion contracts tied to prediction markets.
The results underscore a shift in customer behavior, with Tenev noting that 'if you build great products... they'll be there throughout the cycle.' Robinhood is expanding into areas like prediction markets, derivatives, and advisory tools to reduce its reliance on cryptocurrency trading.
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, stating that 'we're at the very beginning of what's going to be a tokenization super cycle.'