Robinhood's first-quarter earnings report revealed a significant shortfall in both earnings and revenue, primarily due to a substantial decline in cryptocurrency trading revenue. The company's adjusted earnings per share stood at $0.38, falling short of Wall Street's estimate of $0.39, while total revenue rose 15% year-over-year to $1.07 billion, missing analysts' expectations of $1.14 billion.
As a result, shares declined approximately 8% in post-market trading. The slump in crypto-related revenue, which dropped 47% to $134 million from $252 million in the previous year, was offset by growth in other areas, including a 320% increase in 'other transaction revenue' to $147 million, driven by record-breaking activity 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 underscore Robinhood's efforts to diversify its revenue streams and reduce its dependence on cryptocurrency trading, with the company expanding into areas such as prediction markets, derivatives, and advisory tools.