Robinhood Q2 Earnings: Revenue Surpasses, Reaches Profitability, User Revenue Up

Robinhood (HOOD) Q2 Financial Highlights

After the market closed on Wednesday, Robinhood Markets Inc. HOOD, a stock and cryptocurrency trading platform, released its second-quarter financial results. 

Here are the main points.

What Happened: 

The revenue reported by Robinhood for the second quarter was $486 million, up 10% from the previous quarter and up 53% from the same period last year. 

The amount of sales exceeded the Street forecast by $475 million.

$193 million in transaction revenue was recorded by the corporation, a 7% decrease from the previous quarter. 

Revenue from cryptocurrencies decreased 18% from one quarter to the next, totaling $31 million. 

The $25 million in equity-related revenue was 7% less than the previous year. 

To $234 million, net interest income increased 13% year over year.

Robinhood Q2 Earnings and User Metrics

A Street expectation of a loss of 2 cents per share was beaten by Robinhood’s second-quarter earnings per share of 3 cents.

The corporation reported 23.2 million funded accounts, an increase of almost 70,000 over the previous quarter.

10.8 million monthly active users were active during the second quarter, a decrease of almost 1 million accounts.

Robinhood Q2 Financial Highlights

Assets in custody at the end of the quarter were $89 billion, a 13% decrease from the previous quarter.

In the second quarter, Robinhood’s average revenue per user increased to $84 from the first quarter’s $77.

The corporation had $5.8 billion in cash at the end of the third quarter.

Robinhood’s Leadership in Achieving GAAP Profitability

According to Robinhood CEO Vlad Tenev, “In Q2, we achieved a significant milestone by achieving GAAP profitability for the first time as a public company.”

“We’re continuing to innovate for our customers, grow assets, gain market share, and change the industry for the better,” says the company, “guided by our bold product roadmap.”

Jason Warnick, chief financial officer, underlined the company’s successful reversal.

“Reaching GAAP profitability is a testament to the work our team has done to transform the business and better position Robinhood to drive shareholder value,” said Warnick.

“With sales and adjusted EBITDA increasing for five straight quarters, we’re continuing to improve operational efficiency while putting more money into the customer experience. 

Going forward, we’ll continue to concentrate on satisfying consumers and expanding our company.

What’s Next: 

The corporation said that the second-quarter results enhanced its expectation for expenses for the entire year.

Currently, the business expects full-year costs to range between $2.33 billion and $2.41 billion.

The company’s IRA program, which has about $1 billion in assets, has seen a considerable uptake in the future.

The business also reported that balances in its Robinhood Gold program, which offers a 4.9% rate, had more than doubled since the year’s beginning, reaching a total of $11 billion.

Robinhood’s Updates & Share Price

The 24-hour trading market for a few chosen stocks and ETFs was introduced by Robinhood in July.

The business said that it is trying to finish the acquisition of the 55 million shares held by Emergent Fidelity Technologies.

Price action for HOOD: In Wednesday’s after-hours trade, shares of Robinhood were down 4.35% at $11.90.

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