The unexpected earnings beat from Robinhood in a slow trading environment could benefit Coinbase.

Robinhood’s Unexpected Earnings Surge Despite Trading Slowdown May Signal a Positive Outlook for Coinbase

Robinhood (HOOD) surprised analysts with a stronger-than-expected earnings report for Q1 2025, posting adjusted earnings per share (EPS) of $0.37, beating the consensus estimate of $0.33. The company’s revenue totaled $927 million, slightly exceeding the forecast of $920.1 million. Crypto trading revenue, in particular, showed significant growth, climbing 100% year-over-year to $252 million. However, Robinhood’s transaction-based revenue from traditional equities and options trading fell by 13%, from $672 million in Q4 to $583 million.

While the overall slowdown in trading activity, which began after a post-election market boom in Q4, impacted the company’s performance, Robinhood still managed to outperform expectations. The firm also boosted its share repurchase program by $500 million, bringing the total buyback authorization to $1.5 billion.

This unexpectedly strong performance in the crypto sector is likely to have an impact on Coinbase (COIN), which closely mirrors Robinhood’s trends in cryptocurrency trading. With Coinbase scheduled to report its Q1 results on May 8, analysts are predicting a slight drop in revenue to $2.1 billion from $2.27 billion in Q4, driven by weaker trading volumes in both crypto and traditional markets.

Despite a forecasted dip in trading volumes, Robinhood’s ability to maintain growth in crypto revenue could indicate a potential positive surprise for Coinbase as well. Given that both companies share a significant focus on cryptocurrency trading, investors will be keenly watching Coinbase’s upcoming earnings, particularly in light of Robinhood’s strong crypto results. This could provide an optimistic outlook for Coinbase’s performance as the broader crypto market continues to evolve.