Robinhood's crypto revenues collapsed by nearly half, dragging down the broker's stock

Shares of online broker Robinhood Markets fell 14% in trading on April 29. The day before, the company reported earnings and revenue for the first quarter below Wall Street's expectations. Such results Robinhood recorded against the backdrop of declining revenues from crypto trading and slowing trading activity of investors, notes Barron's.

Since the beginning of the year, the company's securities are down by more than 35%. The prolonged fall in prices for bitcoin and other cryptocurrencies puts pressure on Robinhood's securities, Barron's notes. The iShares Bitcoin Trust ETF, an exchange-traded fund through which one can invest in bitcoin without directly buying the cryptocurrency, has fallen by 15% since the beginning of the year, and bitcoin itself has fallen by the same amount over the same period.

- Robinhood's revenue in the first quarter increased by 15% year-on-year to $1.07 billion, according to the company's report. Analysts had expected this figure to be $1.14 billion, Barron's said.

- Earnings per share came in at $0.38 versus analyst estimates of $0.39.

- Cryptocurrency revenue fell for the quarter, down 47% year-over-year to $134 million. The decline comes amid the company's attempts to reduce its reliance on crypto asset price fluctuations, Coindesk notes.

- Robinhood's transactional revenue in the first quarter totaled $623 million - up 6% from the same period last year, but down 20% from the fourth quarter of 2025. The bulk of Robinhood's revenue comes from transactional revenue, so the slowdown in client trading activity is putting pressure on the broker's business, Barron's explains.

- A key driver was event contracts, which drove the company's "other transactional revenue" up 320% year-over-year to $147 million. Robinhood reported that the number of contracts entered into related to prediction markets reached a record 8.8 billion for the quarter.

- The company is also actively growing the subscriber base of its paid premium service Robinhood Gold with enhanced investment opportunities: the number of subscribers reached 4.3 million in the first three months of the year, up 36% year-on-year. Robinhood Gold subscription revenue totaled $50 million in the first quarter, up 32% year-on-year.

- Robinhood Strategies' automated investing service had more than 285,000 active clients and over $1.6 billion in assets under management by the end of the quarter.

"The pace of new product launches continues to accelerate. We are investing in long-term growth and are aggressively deploying AI across all business lines," Robinhood CFO Shiv Verma said during a call with analysts, Barron's reported. Under the leadership of CEO Vlad Tenev, Robinhood aims to diversify its revenue sources and transform itself into a one-stop financial platform covering all key customer needs, Barron's notes. As part of this strategy, the company has already launched credit cards, financial counseling services and banking products.

Tenev also sees cryptocurrency management as a long-term bet for the company's business beyond trading. He said the market is "at the very beginning of a mass tokenization cycle," referring to the migration of traditional assets such as equities to blockchain infrastructure. In March, the U.S. Securities and Exchange Commission (SEC) approved an application by the Nasdaq exchange to launch securities trading in the form of digital assets - tokens. At the first stage, the project will cover shares of the largest public companies in the United States and major index funds. Tokenized securities will be traded in a single order book with traditional shares, at the same price, with the same tickers and with all investor rights preserved.

Analysts at Bernstein reiterated a buy recommendation on Robinhood shares after the report, CNBC writes. "We continue to believe Robinhood stock bottomed out in the first quarter, already given the expectedly weak results. April has started strong, with trading volumes in the stock and options at highs since the beginning of the year," the analysts said.

April 23, JPMorgan Chase lowered its target price on Robinhood shares from $113 to $92, maintaining a neutral recommendation. This target implies the shares growth by 12% relative to the last closing price.

Of the 27 analysts covering the company's stock, 19 advise buying it. Five recommend keeping them in the portfolio, and three recommend selling them.

This article was AI-translated and verified by a human editor