Robinhood Records Crypto Revenue Loss in Q2 2023

UTC by Ibukun Ogundare · 2 min read
Robinhood Records Crypto Revenue Loss in Q2 2023
Photo: Robinhood / Facebook

Despite the revenue loss, Robinhood recorded a total net revenue of $468 million.

While Robinhood (NASDAQ: HOOD) achieved profits in Q2 2023, the company recorded declines in its crypto revenue. The online trading platform released its second-quarter earnings results on August 2nd, noting its first time recording profits since going public in the quarter.

Per the Q2 2023 financial report, Robinhood said its crypto revenue plummeted 18% from $38 million in Q1 to $31 million. It also lost 5% in options and 7% in equities. Robinhood decreased 7% sequentially to $193 million on transaction-based revenues. In addition, assets under custody (AUC) climbed 13% sequentially to $89 billion. Robinhood attributed the Q2 2023 AUC increase to higher equity valuations and continued net deposits.

Robinhood Releases Q2 2023 Results

Despite the revenue loss, Robinhood recorded a total net revenue of $468 million, increasing 10% sequentially. It said the addition is primarily due to higher net interest revenues and seasonally higher proxy revenue. At the same time, the quarterly interest revenue surged 13% sequentially to $234 million. The company noted that growth in interest earnings assets, higher short-term interest rates, and a rise in securities lending activity contributed to the increased net interest revenue. The net income was $25 million or $0.03 earnings per share (EPS).

Meanwhile, the company saw a net loss of $511 million or -$0.57 EPS in the previous quarter. Robinhood amassed gains in different categories in Q2 2023, even its adjusted EBITDA (non-GAAP) surged 31% sequentially to $151 million. Speaking on the GAAP performance for the quarter, Robinhood CEO and co-founder Vlad Tenev stated:

“In Q2, we reached a significant milestone by achieving GAAP profitability for the first time as a public company. Guided by our bold product roadmap we’re continuing to innovate for our customers, grow assets, gain market share, and change the industry for the better.”

Furthermore, the chief financial officer of Robinhood Markets, Jason Warnick, boasted about the profits obtained in Q2 2023. He commended the team’s work, noting that its input contributed to GAAP profitability. Warnick also mentioned that this is the fifth consecutive quarter of revenue and Adjusted EBITDA growth. He concluded by staging that Robinhood will continue to drive efficiency across its operations while investing in customer experience.

Considering its Q2 2023 results, Robinhood has upped its expense outlook from what it had in Q1 2023. It now looks forward to GAAP total operating expenses for the full year 2023 to be between $2.33 billion and $2.410 billion. Notably, this is an improvement of $45 million at the midpoint from its previous outlook.

Currently down 5.75% in extended trading, HOOD stock is trading at $11.73.

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