Robinhood shares slide as crypto slump drives a profit miss
Robinhood shares fell 8% in premarket trading after third-quarter profit of 51 cents a share missed the 55 cents expected; crypto revenue dropped 55% to $120 million.
Shares of trading app Robinhood fell 8% in premarket trading on Wednesday after a prolonged chill in crypto markets pushed its third-quarter profit below Wall Street expectations, Reuters reports.
Key figures
- Crypto revenue fell 55% to $120 million.
- Earnings per share dropped 16% to 51 cents, below the 55 cents expected by analysts (LSEG data).
- Total net revenue still grew 12% to $1.42 billion.
Why crypto cooled
Crypto prices have been under pressure this year from shifting expectations for US interest rates, outflows from bitcoin exchange-traded funds and bouts of risk aversion. Bitcoin has lost nearly 28% over the past three months, and rising oil prices and geopolitical tension have made retail traders more cautious about speculative bets.
Analysts remain upbeat on the longer term: J.P. Morgan’s Kenneth Worthington wrote that the core brokerage business is operating in what he called “a near-perfect environment for retail traders”. Robinhood has expanded in recent years from a trading app into a broader financial-services firm.
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