Robinhood beats earnings estimates with a 300% increase in crypto

According to Bloomberg data, Robinhood reported earnings of $0.61 per share in the third quarter, higher than the $0.53 expected by Wall Street. Total net revenue was $1.27 billion, up 100% from a year earlier and exceeding forecasts of $1.2 billion.

The increase in transaction-based revenue was led by cryptocurrency revenue, which increased more than 300% to $268 million—although it fell short of the expected $287.2 million. Equity revenue increased 132%.

Robinhood CEO Vlad Tenev said in a financial release on Wednesday, "Our team's continued product development delivered record business results in the third quarter, and we're not slowing down—Prediction Markets is growing rapidly, Robinhood Banking is launching, and Robinhood Ventures is coming."

Along with its third-quarter results, the company announced that its CFO, Jason Warnick, will retire next year and step down from his position in the first quarter. Insider shares of the Menlo Park, California-based company have risen nearly 40% since joining the S&P 500 in September and have gained 280% so far this year as the company has become a top performer in the S&P 500 (^GSPC).

The stock's rally has been fueled by new product launches this year, ranging from tokenized stocks in Europe to Prediction Markets and crypto staking, as Robinhood aims to increase customer wallet share.

Since joining the S&P 500 in September, shares of the Menlo Park, California-based company have risen nearly 40% and are up 280% year to date. The company has become the S&P 500's top performer this year (^GSPC).

The stock has been boosted by the launch of new products this year, ranging from tokenized shares in Europe to prediction markets and crypto staking, as Robinhood seeks to expand its customer base.

"I see a number of companies copying Robinhood, providing these additional services, integrating them into a great user experience, and delivering them to their end customers," Paul Brody, EY's global blockchain leader, told Yahoo Finance on Wednesday.

Wall Street points to the rapid growth of the platform's prediction markets, launched last year. The service allows traders to bet on the outcome of major events, from football matches to Nvidia's (NVDA) earnings results, the duration of government shutdowns, and Bitcoin's year-end price target.

"The prediction market is really thriving," Robinhood CEO Vlad Tenev said during an earnings call on Wednesday.

"It's hard to believe we started with the presidential election markets almost a year ago. Since then, we've doubled trading volume every quarter, reaching 2.3 billion contracts in the third quarter."