Crypto Revenue Takes a Hit
Robinhood just dropped its first quarter earnings report, and let’s just say, it’s a wild ride. Their crypto trading revenue plummeted a hefty 30% year-on-year, hanging at a modest $38 million. Last time we checked—oh wait, it was just last year—they brought in $54 million. Talk about a crypto rollercoaster!
Overall Revenue Surges
But wait, there’s a silver lining! Total revenue for Q1 2023 reached $441 million, which is around 47.5% more than the $299 million in Q1 2022. It seems like while the crypto part of the circus is struggling, the overall show must go on. This revenue bump represents a nice 16% increase from just last quarter. Who knew interest could be so lucrative?
Crypto Custody: Growing but Not Quite Thriving
In yet another twist, Robinhood has about $12 billion in crypto under its management—up 50% from the previous quarter. Unfortunately, this number is still 40% lower compared to last year’s figures. So, it’s like finding money in the couch cushions, but realizing you bought a lesser coffee maker with it.
Declining User Engagement
Monthly active users are also partying less. The user base has dwindled from almost 16 million a year ago to under 12 million now. However, before you pop the confetti of despair, there is a slight silver lining; they’ve gained 400,000 users since last quarter. Small wins, right?
Robinhood’s Gambles: High Risks, High Losses
To top off this dramatic saga, Robinhood’s net loss ballooned to $511 million, driven in part by a one-time share-based compensation expense. This is the company’s biggest loss since Q3 2021 and a staggering 30% increase in losses compared to last year. It appears their wallets are lighter but not quite ready for a beach vacation.
What’s Next?
On the horizon, Robinhood hinted at wanting to acquire shares from Emergent Fidelity Technologies. These shares were snagged by FTX’s Sam Bankman-Fried. In addition, they are rolling out 24-hour trading for their popular ETFs and stocks, starting May 16. Sounds like they’re not giving up just yet!
