Robinhood Q3 Earnings Top Analysts’ Expectations as Crypto Revenue Surges Over 300%

Robinhood Markets generated $1.2 billion in revenue for its third quarter, a gain of nearly 100% from the same period a year ago, the firm announced Wednesday, exceeding analysts’ expectations and continuing the strong growth of the online brokerage’s top line.

Robinhood also beat forecasts with earnings per share of $0.61, up about 217% year over year, and $556 million in profits, per MarketScreener.

“Our team’s relentless product velocity drove record business results in Q3 and we’re not slowing down – the forecast markets are growing rapidly, Robinhood Banking is starting to spread, and Robinhood Ventures is coming,” Robinhood Chairman and CEO Vlad Tenev said in a statement.

In after-hours trading, Robinhood shares were down from their Wednesday closing price of $143.40, according to Yahoo Finance. The company’s stock price has risen about 260% year-to-date, outperforming crypto-native competitors like Coinbase, whose shares have jumped about 25% since January 1.

Menlo Park, California-based Robinhood’s results come as the company expanded its business and crypto transaction revenue picked up momentum, increasing to $268 million – an increase of more than 300% from a year ago, the same period. Robinhood totaled $160 million for Q2 in this segment and $252 million in Q1.

The company reported $730 million in transaction-based revenue, slightly lower than consensus forecasts. The prediction markets, while still a minor part of their business, were a bright spot.

The last quarter, Robinhood published $989 million in total sales, up 45% from a year ago and beating analyst expectations of $913 million. Its earnings per share of $0.42 and profits of $386 million for the period also beat expectations.

In a note last monththe investment bank Compass Point had highlighted the growth of this business among other factors in maintaining a “buy” rating and raising its price target to $161, which exceeded its previous record of $153, established in October.

Robinhood will likely generate $50 million in revenue for the fourth quarter “over the course of a full quarter of the NFL season,” analysts wrote, referring to America’s most popular pastime.

robinhood started allowing customers to bet on NFL and college football games in August through a partnership with the Kalshi prediction market. However, Robinhood currently offers prediction markets on other subjects, such as the economy, culture and technology.

Although Robinhood offers commission-free trading on stocks and cryptocurrencies, the firm charges clients a one-cent fee on trades involving event contracts, analysts wrote.

Crypto-centric companies have had to deal with a less vibrant, more unpredictable digital asset market amid macroeconomic uncertainties. The price of Bitcoin rose more than 6% in Q3, a tepid increase in the underlying asset after its 30% spike in the previous quarter.

The largest cryptocurrency by market value recently traded at $103,644, up 4.4% in the past 24 hours, although it is down nearly 18% from its all-time high a month ago, according to data provider CoinGecko.

In a Myriad predictions marketAbout 70% of respondents believe that BTC will move to $115,000 instead of dipping to $85,000. (Disclaimer: Myriad is a unit of Dastan, the parent company of Decrypt.)