Robinhood’s revenue more than doubled in the second quarter to $565 million on the back of explosive growth in cryptocurrency trading, but its shares plunged after the company warned that slowing trading activity would hit its revenue this quarter.
Investors may also be concerned about whether the volatile cryptocurrency will continue to boost the company’s results, which was reflected in a recent 8% drop in Robin Hood’s stock.
Revenues flew by more than 131% during the quarter, close to the company’s top estimate, which ranged between $546-574 million, up from $244 million a year ago. As for cryptocurrency trading revenue, it reached $233 million, accounting for more than half of the $451 million trading revenue in the second quarter, which means that the cryptocurrency share of revenue has grown by more than 51% from just 17% in the first quarter.
Assets under management grew tremendously to 102 billion dollars, recording a growth of 205% during the second quarter of 2021, compared to the size of assets that did not exceed 33 billion during the same quarter last year, but Robin Hood warned investors that the results of the third quarter may be affected by the slowdown in trading after it reached record values during the second quarter. It is worth noting that after the results were announced, Robin Hood’s stock flew by 6.7%, recording $49.8.
Robin Hood posted a net loss of $502 million, or $2.16 per share, to be within the range of net loss expected by the company of $487-537 million.
Robin Hood also floated its stock on the Nasdaq last month, and since then, its stock has been on a rollercoaster ride. Read more [Robinhood Shares Increased and Oversubscribed].