Robinhood's "cryptozyme" profits collapsed by a third. How did the stock react?
The collapse of cryptocurrencies may also affect crypto exchange Coinbase, which will present its quarterly report on February 12
Robinhood's quarterly results were hamstrung by the downturn in cryptocurrency / Photo: instagram.com/robinhoodapp
US-based Robinhood Markets, operator of the popular stock market trading platform, confirmed Wall Street's pessimistic forecast, reporting a sharp decline in profits in the pre-New Year quarter. The weak link was crypto trading, with revenues well below consensus despite strong activity in traditional exchange-traded instruments.
Details
Robinhood's fourth-quarter 2025 net income collapsed 34% to $605 million, or $0.66 per share, but was $0.02 above consensus estimates. At the same time, the trading floor's record quarterly revenue of $1.28 billion fell short of Wall Street's expectations ($1.34 billion), Bloomberg writes.
Private investors have become a key pillar of the stock market, buying back shares on drawdowns caused by geopolitics and fears of a bubble in AI, but volatility has not supported all asset classes, states Reuters. While Robinhood's transactional revenue rose 15% to $776 million, driven by a jump in equity trading revenue (+54%) and options trading revenue (+41%), cryptocurrency revenue plummeted 38% to $221 million against a consensus of $248 million.
Robinhood CFO Shiv Verma explained to Reuters that the most active traders are served at the lowest rates. According to him, clients continued to trade intensively last quarter, which made the average amount of remuneration - rebate received by Robinhood in the reporting period "slightly below" forecasts.
Context
The cryptocurrency sector has been under pressure since mid-autumn 2025. The coming "cryptozyme" led to bitcoin's halving from its October high and a massive washout of speculative positions. In addition, Robinhood's quarterly report came out on the day of a massive sell-off in US brokerage securities. Fears of AI threatening traditional business models, which had previously hit IT companies, have spilled over into the sector.
What about the stock
Robinhood shares fell 7.7% to $79 a share on the Nasdaq after the quarterly report was released. The drawdown of almost 8% persists on February 11 in over-the-counter trading in the United States. Quotes of rival crypto exchange Coinbase went into negative by 1.5%. It will report earnings on February 12. Analysts expect Coinbase to show lower trading volume and weaker revenue growth due to the same market conditions that hit Robinhood's crypto business, Coindesk notes.
According to FactSet, Wall Street is optimistic about Robinhood and Coinbase. The consensus on shares of both trading platforms is "above market" (Overweight, consistent with a buy recommendation). The average target price for Robinhood securities of $145.95 apiece implies a 70% upside potential. The average target for Coinbase shares of $321.8 implies that its quotations of the largest crypto exchange in the United States could double.
This article was AI-translated and verified by a human editor
