Robinhood Crypto Revenue Slides 55% From Last Year, Outperforms Wall Street Expectations

Robinhood’s cryptocurrency trading revenue dropped 55% compared with the previous year in the third quarter, though it came in ahead of analysts’ expectations. At the same time, the company’s blockchain operations showed signs of continued growth.

The company recorded $120 million in crypto transaction revenue for the quarter, down from around $267 million a year earlier. The total exceeded Wall Street’s estimate of $114.1 million, according to Robinhood’s earnings report published Tuesday.

Crypto trading accounted for 8.4% of Robinhood’s $1.424 billion in quarterly revenue, compared with approximately 21% in the third quarter of last year.

The decline coincided with reduced cryptocurrency trading across its platforms. Total crypto trading volume fell 38% year over year to $50 billion. Volume on the Robinhood app dropped 48% to $21 billion, while Bitstamp, the cryptocurrency exchange, reported a 28% decrease to $29 billion.

Stronger performance in other segments

Despite the downturn in crypto trading, Robinhood’s total revenue increased 12% annually to $1.424 billion. Growth in options, equities and prediction markets helped offset the weakness, although the overall figure was slightly below analysts’ forecast of $1.43 billion.

Options revenue rose 31% to $399 million, while equities revenue climbed 41% to $121 million. Prediction markets generated $173 million, more than six times the amount recorded during the same period last year.

The company reported earnings per share of $0.51, missing the consensus estimate of $0.55.

Robinhood Chain gains traction

Robinhood continued to expand its blockchain infrastructure despite the decline in crypto trading revenue.

The company said Robinhood Chain processed over $80 billion in decentralized exchange trading volume and generated more than $50 million in network fees during its first quarter of mainnet operations.

The network fees reflect blockchain activity and are not the same as the crypto transaction revenue reported in the company’s financial statements. Robinhood did not disclose how much of those fees was recognized as revenue.

Following the earnings announcement, Robinhood shares declined about 5% in after-hours trading.