Robinhood's third-quarter results showed how quickly its revenue mix is changing. Cryptocurrency transaction revenue fell 55% from a year earlier to $120 million, yet total transaction-based revenue increased 19% to a record $867 million as event contracts, options and equities expanded. The U.S. brokerage reported $1.42 billion in total net revenue for the quarter ended September 30, up 12%, while net income declined 14% to $476 million.

Crypto activity weakened from a strong comparison

Robinhood said crypto notional trading volume fell 38% year over year to $50 billion. Volume in the Robinhood app declined 48% to $21 billion, while Bitstamp volume decreased 28% to $29 billion. The earnings presentation also shows an important sequential distinction: crypto revenue rose 20% from the second quarter, even as it remained far below the prior-year period. Of the $120 million reported for the category, $26 million was attributed to Robinhood Chain. Excluding that contribution, the presentation indicates the underlying trading business had a softer sequential comparison than the headline category total.

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Event contracts became a larger contributor

Event-contract revenue reached $173 million, up more than sixfold from a year earlier and 11% from the previous quarter. The company processed 16.4 billion event contracts, more than seven times the year-ago level. Options remained the largest transaction category at $399 million, up 31%, while equities revenue rose 41% to $121 million. Together, those businesses more than offset the year-over-year crypto decline in the transaction line. The gap between contract growth and revenue growth also matters: it suggests that average economics per contract did not increase at the same pace as activity.

Revenue growth came with higher costs

The broader revenue record did not produce a higher bottom line. Diluted earnings per share fell 16% to $0.51, and Reuters reported that this was below the $0.55 average estimate compiled by LSEG. Operating expenses increased 16% to $739 million. Robinhood attributed the increase mainly to larger provisions for credit losses as its credit-card loan book grew, costs connected with newer businesses and additional marketing and growth spending.

The customer base continued to expand

Funded customers increased 7% to 28.7 million, while Robinhood Gold subscribers rose 34% to 5.2 million. Total platform assets reached $396 billion, up 19%, and net deposits were $15.7 billion for the quarter. Those measures indicate that customers continued adding assets even as crypto trading cooled. Net interest revenue, however, fell 9% to $415 million, partly because of lower short-term rates and reduced securities-lending activity.

What the mix means

For Robinhood, the results reduce dependence on any single trading category, but they also shift more attention toward the durability and regulation of event contracts. Reuters cited an outside analyst who questioned whether prediction markets are attracting new customers or mainly redirecting activity from existing traders. The quarter alone cannot settle that issue, particularly because contract volume grew much faster than event-contract revenue.

What to watch next

Investors will be watching whether crypto activity stabilizes, whether event-contract revenue keeps pace with volume, and whether newer businesses can grow without pushing expenses up faster than revenue. Regulatory treatment of prediction markets is another uncertainty because state and federal authorities continue to contest the boundaries of some event contracts. Robinhood's figures show a brokerage becoming more diversified, not one insulated from market cycles. Crypto remains material, but in this quarter, prediction markets and options carried more of the transaction engine.

Sources

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