Flashy Numbers, Fragile Narrative
Robinhood closed the third quarter with the fastest growth in its history:

• Net revenue: $1.27 B (+100 % YoY)

• Net profit: $556 m (+271 % YoY)

• Diluted EPS: $0.61 (+259 % YoY)

• Funded accounts: 26.8 m (+2.5 m net adds)

Yet the shares slipped 7 % after hours, and are down 12 % from the earnings-day high.
The headline beat was not enough; investors worry they are buying the cyclical peak, not a structural inflection.

Where the Growth Came From
Transaction-related revenue (57 % of total) powered the quarter:

• Crypto trading: $268 m (+300 % YoY), one-third of all trading dollars.

• Prediction-markets: 2.3 B contracts traded (+100 % QoQ), now the third-most-active asset class behind equities and options.

• Equity commissions: +132 % YoL; options: +50 % YoY.

Net-interest income chipped in 36 %, helped by record margin balances and higher short-rebate capture.
Subscription & other income (Gold, retirement, card) made up the remaining 7 %.

The Crypto Caveat
The $268 m crypto figure missed the consensus whisper of $287 m.
Bitstamp—acquired in June—added $180 B of notional October volume, but institutional rates are razor-thin and the exchange is still digesting legacy lower-fee contracts.
In short: more tickets, less take-rate.

Prediction Markets: From Curio to Core
Robinhood lists >1 000 event-contracts (sports, politics, macro, tech).
October notional topped $2.5 B; management guiding to ~$25 m incremental revenue per month at run-rate.
Regulatory talks are under way with the FCA and Abu Dhabi Global Market to launch an offshore venue—critical if the CFTC tightens U.S. rules.

Cost Discipline vs. Cycle Anxiety
Operating expenses rose 31 % YoY to $685 m, but revenue growth outpaced them, lifting EBITDA margin to 46 %.
Still, analysts at Redburn flagged “peak-cycle risk”: payment-for-order-flow (PFOF) rates, crypto volatility and margin-utilisation are all at multi-year highs—levels that historically mean-revert within 3-4 quarters.
With the stock trading at 28× forward earnings (ex-cash) versus Charles Schwab at 19×, the bar was simply higher than the beat.

Balance-Sheet Firepower and the Next Acts
Robinhood ended the period with $4.3 B cash and $8.6 B shareholders’ equity.
An $810 m buy-back programme (started 2024) is already 70 % completed.
CEO Vlad Tenev told investors the cash pile will seed three new verticals:

1. Robinhood Banking—demand-deposit accounts and payroll direct-deposit already in beta.

2. Robinhood Ventures—an in-house VC sleeve, SEC filing submitted.

3. Tokenised equities—400+ instruments live in 30 countries; full DeFi integration slated for Bitstamp rails in 2026.

International revenue is targeted to exceed 50 % of total “within ten years”; today it is <15 %.

Guidance: Strong October, But No 2026 Numbers
Management said October set fresh records across equities, options, futures and prediction contracts.
Yet they refused to formalise full-year guidance, citing “macro uncertainty.”
That verbal taper, more than any single line item, is what spooked growth investors and left the stock drifting lower even as the numbers screamed higher.

Flashy Numbers, Fragile Narrative
Robinhood closed the third quarter with the fastest growth in its history:

• Net revenue: $1.27 B (+100 % YoY)

• Net profit: $556 m (+271 % YoY)

• Diluted EPS: $0.61 (+259 % YoY)

• Funded accounts: 26.8 m (+2.5 m net adds)

Yet the shares slipped 7 % after hours, and are down 12 % from the earnings-day high.
The headline beat was not enough; investors worry they are buying the cyclical peak, not a structural inflection.

Where the Growth Came From
Transaction-related revenue (57 % of total) powered the quarter:

• Crypto trading: $268 m (+300 % YoY), one-third of all trading dollars.

• Prediction-markets: 2.3 B contracts traded (+100 % QoQ), now the third-most-active asset class behind equities and options.

• Equity commissions: +132 % YoL; options: +50 % YoY.

Net-interest income chipped in 36 %, helped by record margin balances and higher short-rebate capture.
Subscription & other income (Gold, retirement, card) made up the remaining 7 %.

The Crypto Caveat
The $268 m crypto figure missed the consensus whisper of $287 m.
Bitstamp—acquired in June—added $180 B of notional October volume, but institutional rates are razor-thin and the exchange is still digesting legacy lower-fee contracts.
In short: more tickets, less take-rate.

Prediction Markets: From Curio to Core
Robinhood lists >1 000 event-contracts (sports, politics, macro, tech).
October notional topped $2.5 B; management guiding to ~$25 m incremental revenue per month at run-rate.
Regulatory talks are under way with the FCA and Abu Dhabi Global Market to launch an offshore venue—critical if the CFTC tightens U.S. rules.

Cost Discipline vs. Cycle Anxiety
Operating expenses rose 31 % YoY to $685 m, but revenue growth outpaced them, lifting EBITDA margin to 46 %.
Still, analysts at Redburn flagged “peak-cycle risk”: payment-for-order-flow (PFOF) rates, crypto volatility and margin-utilisation are all at multi-year highs—levels that historically mean-revert within 3-4 quarters.
With the stock trading at 28× forward earnings (ex-cash) versus Charles Schwab at 19×, the bar was simply higher than the beat.

Balance-Sheet Firepower and the Next Acts
Robinhood ended the period with $4.3 B cash and $8.6 B shareholders’ equity.
An $810 m buy-back programme (started 2024) is already 70 % completed.
CEO Vlad Tenev told investors the cash pile will seed three new verticals:

1. Robinhood Banking—demand-deposit accounts and payroll direct-deposit already in beta.

2. Robinhood Ventures—an in-house VC sleeve, SEC filing submitted.

3. Tokenised equities—400+ instruments live in 30 countries; full DeFi integration slated for Bitstamp rails in 2026.

International revenue is targeted to exceed 50 % of total “within ten years”; today it is <15 %.

Guidance: Strong October, But No 2026 Numbers
Management said October set fresh records across equities, options, futures and prediction contracts.
Yet they refused to formalise full-year guidance, citing “macro uncertainty.”
That verbal taper, more than any single line item, is what spooked growth investors and left the stock drifting lower even as the numbers screamed higher.