Robinhood Shares Fall 4% as Crypto Slump Weighs on Profits, Offsetting Gains in New Businesses

Robinhood Markets posted record third-quarter revenue of $1.42 billion on Monday, beating Wall Street expectations, but a dramatic drop in cryptocurrency trading income overshadowed the headline number and sent shares down roughly 4% in extended trading.

Net income for the quarter fell to $476 million, a decline of approximately 16% compared with the same period a year earlier. Diluted earnings per share came in at $0.51, down 17% year-over-year, reflecting the outsized role that volatile crypto markets play in the company's overall profitability.

Cryptocurrency revenue, once one of Robinhood's most powerful growth engines, collapsed 55% to $120 million during the quarter. Crypto notional trading volumes fell 38% year-over-year to $50 billion across the platform. That included a 48% slide on the Robinhood app itself to $21 billion and a 28% decline at Bitstamp, the European exchange Robinhood acquired last year, to $29 billion.

The weakness in crypto stood in sharp contrast to strength elsewhere in the business. Transaction-based revenues overall rose 19% to $867 million, lifted by growing demand for options contracts and the company's rapid expansion into prediction markets.

Prediction markets emerged as one of the most striking bright spots of the quarter, generating $173 million in revenue — more than six times the figure recorded in the same quarter a year earlier. The segment has grown quickly as Robinhood has positioned itself to capture retail interest in event-based trading, a category that gained mainstream attention during the 2024 and 2025 election cycles.

Robinhood Chain, the company's proprietary blockchain network, also contributed $26 million in its first full quarter on mainnet after launching on July 1. The figure is modest relative to total revenue but signals that Robinhood's push to build out on-chain financial infrastructure is beginning to generate tangible returns.

Chief Executive Vlad Tenev has spent the past two years pushing Robinhood beyond its origins as a commission-free stock trading app, adding banking features, retirement accounts, credit cards, and now its own blockchain. The strategy is designed to reduce the company's dependence on any single asset class — a vulnerability that has repeatedly exposed it to sharp earnings swings tied to cryptocurrency sentiment.

Despite the quarterly profit decline, Robinhood's record top-line revenue suggests that diversification effort is gaining traction. Analysts had flagged going into the quarter that softer crypto prices and muted retail trading activity could pressure results, making the revenue beat notable even as the bottom-line miss disappointed.

The broader cryptocurrency market saw significant cooling in the third quarter after a strong run earlier in the year, affecting trading platforms and crypto-adjacent businesses across the industry. Robinhood's Bitstamp acquisition, which closed in 2024, was intended to give the company institutional-grade crypto infrastructure and a foothold in European markets, but near-term volume weakness has complicated the investment case.

Investors will watch whether crypto volumes recover heading into the fourth quarter, traditionally one of the more active periods for digital-asset trading. At the same time, analysts are likely to press management on the pace of monetisation for Robinhood Chain and whether prediction-markets growth can be sustained beyond politically driven event cycles. The company is expected to provide fourth-quarter guidance on its earnings call.