Robinhood third-quarter results missed Wall Street targets, causing a sharp drop of 12.4% in after-hours trading. Despite the dip, the company reported impressive growth in key areas, doubling its crypto trading volume year-on-year.
CEO Vlad Tenev highlighted new developments, expressing confidence in Robinhood’s momentum. He mentioned the recent rollout of Robinhood Legend, a desktop trading platform tailored for active traders.
Tenev further pointed at the soon-to-be-released products, such as index options and futures, which will be used to help traders who are in search of more advanced features. A Presidential Election Market that gives users the chance to make bets on political outcomes also went live this week.
Financial data say that Robinhood’s total revenue increased by 36% compared to the last year, thus making its total revenue amount $637 million. The real cause lies in the transaction-based revenues, especially in options and cryptocurrencies, which grew by 63% and 165% respectively.
Crypto trading alone contributed $61 million, while equity trading generated $37 million. Interest revenue grew to $274 million, driven by interest-earning assets.
Robinhood cuts operating expenses despite regulatory costs
On the expense front, Robinhood kept costs in check, with total operating expenses dropping 10% year-over-year to $486 million. The company also set aside $10 million for regulatory issues, a significant reduction from $104 million last year.
Net income surged to $150 million, with earnings per share hitting $0.17, a substantial turnaround from a $0.09 loss per share in Q3 2023.
According to its latest quarterly reports, Robinhood has a solid customer base. The funded accounts rose to 24.3 million, and the assets under custody grew by 76% to $152.2 billion. Moreover, the monthly active users jumped to 11 million, and the average revenue per user reached $105.
In the future, Robinhood intends to go international, specifically in the UK. The approval obtained by the company from the Financial Conduct Authority grants it options trading onboarding there in 2025.
