Cryptocurrency trading income "halved"! Robinhood's Q1 earnings fall short of expectations, stock price drops 8% after hours

Robinhood, the U.S. retail trading platform (stock ticker: HOOD), announced its first-quarter earnings, which fell short of market expectations due to cryptocurrency trading revenue being halved compared to the same period last year. After the earnings release, Robinhood’s stock plummeted about 8% in after-hours trading.
According to FactSet data, Robinhood’s adjusted earnings per share (EPS) for the first quarter were $0.38, below Wall Street’s forecast of $0.39; revenue, although up 15% year-over-year to $1.07 billion, still missed analysts’ expectations of $1.14 billion.
As Robinhood’s “cash cow” for fee income, cryptocurrency-related revenue declined 47% year-over-year, dropping from $252 million last year to $134 million.
In response, CEO Vlad Tenev stated during the earnings call, “I don’t want to talk about Bitcoin prices anymore.” He emphasized that the company is focusing on using blockchain technology as the “infrastructure” for financial services.
Event contracts surge ahead, other trading income soars 320%
Despite weak cryptocurrency trading, Robinhood demonstrated remarkable growth in other areas. Benefiting from new product launches, the company’s overall trading revenue for the first quarter increased from $583 million last year to $623 million.
The most notable was “event contracts,” which drove “other trading income” up 320% year-over-year to $147 million. Robinhood stated that in the first quarter alone, users traded as many as 8.8 billion contracts related to prediction markets.
Vlad Tenev commented, “As long as we can develop excellent products, users will stay whether the market is bullish or bearish.”
To reduce reliance on cryptocurrency trading and break free from the “dependent on luck” performance, Robinhood is actively expanding its business scope, extending into prediction markets, derivatives, and financial advisory tools.