Robinhood’s Q3 Crypto Transaction Revenue Falls to $120 Million

Robinhood recorded $120 million in crypto transaction revenue in the third quarter, a 55% year-over-year drop that accompanied an earnings miss and a more than 7% after-hours share decline Tuesday.

Earnings per share were 51 cents, short of the 55-cent analyst consensus. Total transaction-based revenue nevertheless increased about 19% to $867 million, with options revenue up 31% and event-contract revenue growing more than sixfold.

Robinhood’s operating expenses rose 16% to $739 million. The increase was driven mainly by a larger provision for credit losses, investment in newer businesses including Trump Accounts and Rothera, and higher marketing costs.

Prediction markets have become another growth area for Robinhood. Chief Financial Officer Shiv Verma said the business had reached nearly $500 million in annualized revenue less than two years after launch. Sports and nonsports event contracts both grew, and nonsports contracts made up a larger share of total trading volume.