Robinhood Markets reported record second-quarter earnings on July 29, as growth in futures contracts, options and equities offset another decline in cryptocurrency trading.
Summary
- Robinhood’s Q2 revenue rose 32% to $1.31 billion, and revenue increased 48%.
- Event contract revenue reached $156 million, up more than 10x and surpassing cryptocurrency transaction revenue.
- Crypto currency fell 38% to $100 million despite $40 billion in trading volume for the quarter reported.
According to its Q2 earnings release, total revenue rose 32% year over year to $1.31 billion in the quarter ended June 30.
Net income rose 48% to $573 million, while diluted earnings per share came in at $0.62. However, Robinhood said net income included $129 million in gains primarily related to the liquidation of Robinhood Ventures Fund I. Those gains added $0.14 to diluted EPS.
The broad mix of income also increased. Net interest income increased 9% to $389 million, while other income increased 54% to $143 million. Robinhood says this latest increase was due to revenue from the Trump account service and higher Gold subscription revenue.
Event contracts became the fastest growing revenue line for Robinhood
Transaction-based revenue increased 44% to $776 million. Event contract revenue reached $156 million, more than 10 times the previous level, while commercial event contracts increased to more than $13.6 billion. Option cash increased 29% to $342 million, and equity cash increased 95% to $129 million.
Robinhood Chief Financial Officer Shiv Verma said “the business is firing on all cylinders,” management’s assessment of the reported metric. The company also said that Rothera, its CFTC-licensed trading business and clearinghouse with Susquehanna, has processed more than $3.5 billion in contracts since launching in June. Robinhood has explored adding more prediction market providers as competition grows.
Cryptocurrency transaction revenue fell 38% to $100 million. Robinhood reported $40 billion in crypto notional volume, including $18 billion in the main app and $22 billion in Bitstamp. App-based crypto volume is down 35% from last year, indicating that acquired exchanges provided more than half of the quarter’s reported crypto activity.
Nevertheless, Robinhood continued to build its digital asset business. The company launched the Robinhood Chain public mainnet, launched Stoken Tokens to eligible users in over 120 countries and debuted Robinhood Earn, its first in-app lending product. In a related story, crypto.news explained how Robinhood Chain uses the Ethereum layer-2 network for token assets and fixed currencies.
Robinhood also completed its acquisition of WonderFi during the quarter, marking its official entry into Canada. As crypto.news reported, the agreement added regulated platforms including Bitbuy and Coinsquare. Internationally funded customers passed one million, though Robinhood did not break out WonderFi’s quarterly revenue contribution. The company said it “plans to launch crypto offerings in the UK,” but did not provide a launch date.
Deposits and customer assets reached new records
Total deposits reached $21.7 billion, which equates to a 28% annual growth rate relative to platform assets in the first quarter. The platform’s total assets increased 32% to $369 billion, and funded customers increased 7% to 28.4 million. Investment accounts increased 9% to 29.9 million.
Robinhood Gold subscribers grew 39% to 4.8 million, and average revenue per user increased 24% to $187. The company also repurchased $414 million of Class A shares during the quarter at an average price of approximately $94.
Costs have increased in line with the expansion. Operating expenses increased 33% to $734 million due to marketing, growth capital expenditures, restructuring costs and costs associated with Rothera and other new businesses. Adjusted EBITDA, a non-GAAP measure, increased 35% to $741 million.
HOOD shares fell as investors weighed the revenue mix
Shares of Robinhood closed Wednesday at $89.84, down about 3.4% before the earnings release. Reuters reported that the stock was down another 0.8% in extended trading, even after adjusted earnings beat analysts’ average estimate.
Investors will now watch if the activity of the event contract remains strong and if the crypto trade recovers. Robinhood lowered its 2026 adjusted operating expenses and share-based compensation outlook to between $2.675 billion and $2.775 billion, from a previous range of $2.7 billion to $2.825 billion. However, that forecast does not include credit losses, acquisitions, restructuring and regulatory costs.
Regulation remains a key risk for the company’s fast-growing brand. Robinhood warned that enforcement actions or changes in state and federal law could prevent it from awarding event contracts. Meanwhile, its UK crypto launch and future Singapore brokerage services remain forward-looking plans with no confirmed start dates.
