Robinhood Crypto Revenue Drops 24% to $39M in Q4

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• Robinhood reported a 24% decline in crypto revenue to $39 million in Q4.
• The company missed both earnings and revenue estimates for the quarter.
• Robinhood rolled out its Polygon-based Web3 wallet to more than one million waitlisted users in 2022.

Robinhood’s Crypto Revenue Declines

Robinhood Markets (HOOD) reported $39 million in crypto trading revenue for the fourth quarter, a 24% decline from the previous quarter’s figure of $51 million. Despite this drop, the online trading brokerage still had a board authorized to pursue purchasing all or most of the 55 million shares that a holding company for former FTX execs Sam Bankman-Fried and Gary Wang purchased in May 2022, and canceled nearly $500 million of its share-based compensation.

Rollout of Polygon-Based Wallet

In September 2021, Robinhood rolled out a beta version of its Polygon-based Web3 wallet which was later released to more than one million waitlisted users in 2022. This new wallet allows customers to store their cryptocurrencies safely and securely on the platform.

Q4 Earnings Miss Estimates

Overall for the fourth quarter, Robinhood posted an adjusted loss of 19 cents per share, ahead of the consensus analyst estimate of 15 cents per share according to FactSet data. However, revenue came up short at $380 million compared to estimates of $396 million. Shares were up 3% at $10.80 after hours following these results but are down 21% over the last year.

Upcoming Analyst Call

The company is scheduled to hold an analyst call at 5 p.m ET on Wednesday where they will discuss these results further and offer insight into their strategy going forward as well as any other pertinent information related to their business model and operations.

Conclusion

Though Robinhood’s crypto revenues were down 24%, it was able to cancel nearly 500M worth of share based compensation which may have offset some losses associated with it’s quarterly performance overall resulting only slightly lower than estimated earnings despite missing revenue targets . Investors can look forward to further insights when they hold their upcoming call with analysts later today.