Robinhood Crypto Revenue Drops 55% Year Over Year, Beats Estimates

Robinhood’s cryptocurrency trading revenue declined 55% year over year in the third quarter, although the figure came in above analysts’ expectations as the company expanded its broader blockchain business.

The company’s crypto transaction revenue fell to $120 million in the third quarter, according to its earnings report released Tuesday. That compared with approximately $267 million in the same quarter last year, but exceeded Wall Street’s estimate of $114.1 million.

Cryptocurrency trading contributed just 8.4% of Robinhood’s total quarterly revenue of $1.42 billion, down from around 21% a year earlier.

The drop followed a slowdown in customer activity across the company’s trading platforms. Total crypto trading volume decreased 38% year over year to $50 billion. Trading through the Robinhood app fell 48% to $21 billion, while volume on cryptocurrency exchange Bitstamp declined 28% to $29 billion.

Despite the weakness in crypto trading, Robinhood’s overall business continued to grow. Total revenue increased 12% from a year earlier to $1.424 billion, supported by stronger performance in options, equities and prediction markets. However, the result came slightly below analysts’ consensus estimate of $1.43 billion.

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

Robinhood reported third-quarter earnings per share of $0.51, missing the consensus forecast of $0.55.

Despite the decline in crypto trading activity, the company continued to expand its digital asset infrastructure.

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

The company’s reported blockchain fees represent activity on the network and are separate from its crypto transaction revenue. Robinhood did not specify how much of those fees was recognized as revenue.

Robinhood shares fell approximately 5% in after-hours trading.