Robinhood profit falls 14% on venture-fund losses despite record $1.42 billion revenue

Robinhood Markets reported third-quarter results on Oct 27 with record revenue of $1.42 billion, up 12% from a year earlier, while net income fell 14% to $476 million. Diluted earnings per share fell 16% to $0.51.

That profit included $67 million, or $0.07 a share, of unrealized losses, primarily from the mark-to-market of Robinhood Ventures Fund I, the company's venture capital fund. Robinhood shares fell 4.77% to $90.05 in after-hours trading on Oct 27, Seeking Alpha reported.

Against estimates

Analysts had expected earnings of $0.55 a share and revenue of $1.43 billion, according to Investing.com. Diluted earnings per share came in below that estimate, while adjusted earnings per share, a measure Robinhood introduced this quarter, was $0.60, down 3% from a year earlier.

Transaction-based revenue rose 19% to $867 million, below the $879 million StreetAccount estimate, CNBC reported.

Revenue by line

Growth in options, equities and event contracts, which are prediction-market bets on outcomes such as sports and elections, outweighed a 55% fall in crypto revenue.

Crypto trading volume fell 38% to $50 billion, while equity trading volume rose 53% to $992 billion and event contracts traded rose more than sevenfold to 16.4 billion. Chief Financial Officer Shiv Verma told CNBC that event contracts on crypto price moves did well in the quarter despite the slump in crypto prices and spot trading.

Robinhood said lower securities lending activity and lower short-term interest rates drove the drop in net interest revenue, partly offset by growth in interest-earning assets.

Costs and customers

Total operating expenses rose 16% to $739 million. The company attributed the rise mainly to higher provisions for credit losses as its credit card loan book grows, costs tied to Trump Accounts and its Rothera business, and marketing.

Robinhood lowered the top of its 2026 range for adjusted operating expenses and stock-based compensation by $25 million, to $2.675 billion to $2.75 billion.

• Funded customers rose 7% to 28.7 million.
• Total platform assets rose 19% to $396 billion.
• Net deposits were $15.7 billion in the quarter and $71 billion over twelve months.
• Robinhood Gold subscribers rose 34% to a record 5.2 million.
• Rothera passed $100 million in annualized revenue in its first full quarter.

Verma said October net deposits had topped $13 billion month-to-date, including $6 billion from the Dell family's contribution to Trump Accounts.

Who is exposed

Robinhood Ventures Fund I's market value flows into Robinhood's reported profit: the company deconsolidated the fund in the second quarter, booking gains then, and the third-quarter unrealized losses came primarily from marking the fund to market.

Crypto exchange Coinbase reports its own third-quarter results after the market close on Oct 29.

What comes next

• The Federal Reserve announces its next interest-rate decision on Oct 28.
• Coinbase reports third-quarter results after the market close on Oct 29.