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Robinhood Markets, Inc. (HOOD)·Q2 2025 Earnings Summary

Executive Summary

  • Revenue of $989.0M, up 45% year-over-year and up 7% quarter-over-quarter; beat S&P Global Wall Street consensus of $913.3M by ~$75.7M. Strong growth was driven by options, crypto, and equities trading, plus higher interest-earning assets and securities lending . Revenue Consensus Mean: $913.3M*
  • Diluted EPS of $0.42 (+100% YoY), with S&P Global Primary EPS actual at $0.4985*, beating the Street’s $0.30884*; margin strength reflected disciplined OpEx and mix shift toward transaction revenues. Adjusted EBITDA was $549M (+82% YoY), ~56% margin, above consensus EBITDA of $448.8M* .
  • Guidance update: full-year 2025 Adjusted Operating Expenses + SBC raised to $2.15B–$2.25B to include ~$65M of costs from the Bitstamp acquisition; prior outlook was $2.085B–$2.185B (ex-TradePMR costs were added in Q1). Management reiterated exclusions for provision for credit losses and pending WonderFi costs .
  • Near-term catalysts: tokenization launch in the EU (stock/ETF tokens), Bitstamp closing and integration, U.S. staking ramp, and robust July start in Q3 with ~$6B net deposits and record equity/options volumes noted by management .

What Went Well and What Went Wrong

What Went Well

  • Record and broad-based trading momentum: equities notional volumes $517B (+112% YoY), options contracts 515M (+32% YoY), crypto volumes rising with Bitstamp adding $7B exchange volume post-close .
  • Subscription and deposit traction: Robinhood Gold subscribers reached 3.5M (+76% YoY), ARPU rose to $151 (+34% YoY), and net deposits were $13.8B (annualized 25% of prior quarter TPA) .
  • Management emphasizing tokenization as a secular innovation; “the biggest innovation our industry has seen in the past decade,” underpinning global expansion and product velocity .

What Went Wrong

  • Transaction-based revenue fell 8% Q/Q (despite being up 65% YoY), reflecting quarterly variability in trading mix and seasonality; crypto revenues in Q2 were $160M vs $252M in Q1 .
  • Operating expenses up 12% YoY; provision for credit losses rose 56% YoY, and FY25 Adjusted OpEx+SBC guide moved higher due to Bitstamp costs, adding to expense intensity .
  • Management acknowledged promotions cadence and deposit volatility intra-quarter; Q&A reiterated promotions are part of the playbook, but deposit flows can fluctuate with trading conditions .

Financial Results

MetricQ4 2024Q1 2025Q2 2025
Total Net Revenues ($USD Millions)$1,014 $927 $989
Diluted EPS ($USD)$1.01 (includes $0.41 deferred tax benefit and $0.06 accrual reversal) $0.37 $0.42
Net Margin (%)90% (benefit-affected) 36% 39%
Adjusted EBITDA ($USD Millions)$613 $470 $549
Adjusted EBITDA Margin (%)60% 51% 56%

Segment revenue and mix

MetricQ4 2024Q1 2025Q2 2025
Transaction-based Revenues ($USD Millions)$672 $583 $539; Q/Q (8)%, Y/Y +65%
— Options Revenue ($USD Millions)$222 $240 $265; Y/Y +46%
— Crypto Revenue ($USD Millions)$358 $252 $160; Y/Y +98%
— Equities Revenue ($USD Millions)$61 $56 $66; Y/Y +65%
Net Interest Revenues ($USD Millions)$296 $290 $357; Q/Q +23%, Y/Y +25%
Other Revenues ($USD Millions)$46 $54 $93; Q/Q +72%, Y/Y +33%

Key performance indicators (KPIs)

KPIQ4 2024Q1 2025Q2 2025
Funded Customers (Millions)25.2 25.8 26.5
Investment Accounts (Millions)26.2 27.0 27.4
Total Platform Assets ($USD Billions)N/A (AUC $193B) $221 $279
Net Deposits ($USD Billions)$16.1 $18.0 $13.8
ARPU ($USD)$164 $145 $151
Robinhood Gold Subscribers (Millions)2.6 3.2 3.5
Cash & Cash Equivalents ($USD Billions)$4.332 $4.416 $4.162

Additional operating metrics (Q2 2025)

MetricQ2 2025
Retirement AUC ($USD Billions)$19.0 (+118% YoY)
Cash Sweep ($USD Billions)$32.7 (+56% YoY)
Margin Book ($USD Billions)$9.5 (+90% YoY)
Equity Notional Trading Volumes ($USD Billions)$517 (+112% YoY)
Options Contracts Traded (Millions)515 (+32% YoY)
Robinhood App Crypto Notional Volumes ($USD Billions)$28 (+32% YoY)
Bitstamp Exchange Crypto Notional Volumes ($USD Billions)$7 (post-close)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted Operating Expenses + SBC (non-GAAP)FY 2025$2.085B–$2.185B (updated in Q1; added TradePMR costs) $2.15B–$2.25B (includes ~$65M Bitstamp costs) Raised (to include Bitstamp)
NotesFY 2025Excludes provision for credit losses, Bitstamp pending in Q1, WonderFi costs, significant regulatory items Excludes provision for credit losses, WonderFi costs, potential significant regulatory items Definition unchanged

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
AI / CortexAnnounced in March; pipeline building Cortex gaining adoption among Gold members; continued iteration Expanding functionality
Tokenization & L2Plans to expand; Bitstamp on track EU stock/ETF tokens launched; Robinhood Layer-2 planned; tokenization framed as decade-scale innovation Accelerating rollout
Crypto Monetization/PricingCrypto volumes surged; EU staking Smart exchange routing with tiered fees; blended take rate ~58 bps in Q2; mid-60s in July Improved pricing for high-volume traders
Promotions & Net DepositsRecord net deposits in Q1 ($18B) Q2 net deposits $13.8B; management reiterates promotions are core, deposits can be volatile intra-quarter; July ~$6B Reaccelerating into Q3
Regulatory/LegalGeneral risk disclosures; pending approvals Dialogue on SEC/tokenization; risk factors reiterated Active engagement
Active Trader Tools (Legend)Legend expanded, index options, futures; desktop enhancements Mobile Legend charts; overnight trading growth; Summit scheduled Feature velocity continuing
Staking (US)EU staking; planning U.S. ~$750M staked in first month; ~$6B stakable assets Rapid early uptake
Securities LendingStrength building June record; July equal or stronger; fully paid program growth Strong ramp

Management Commentary

  • “We delivered strong business results in Q2 driven by relentless product velocity, and we launched tokenization—which I believe is the biggest innovation our industry has seen in the past decade.” — Vlad Tenev, CEO .
  • “We grew revenues 45% year over year, drove 81% incremental adjusted EBITDA margins and doubled EPS from a year ago.” — Jason Warnick, CFO .
  • “Net deposits are around $6 billion [in July]…equity and options trading volumes are setting new monthly records.” — Jason Warnick, CFO .
  • “Stock tokens will do for stocks what stablecoin did for fiat currencies…24/7 trading, instant settlement, self custody.” — Vlad Tenev .

Q&A Highlights

  • Promotions and net deposit strategy: Promotions remain core; economics are compelling; deposit volatility is expected with trading activity, and Q3 began strongly .
  • Crypto pricing and smart exchange routing: Tiered pricing for high-volume traders via exchange routing; blended take rate ~58 bps in Q2 and mid-60s in July, with strong adoption and more volume per trader .
  • Staking traction: ~$750M staked within a month; ~$6B in stakable assets; view staking as a market share opportunity in crypto .
  • Securities lending: June was a record; July similar or stronger; growth driven by margin book and fully paid lending inventory, plus hard-to-borrow opportunities .
  • Expense discipline: Culture of “lean and disciplined,” using AI/process improvements to keep cost growth low single digits while funding growth and marketing .

Estimates Context

MetricConsensus (S&P Global)ActualSurprise
Revenue ($USD Millions)$913.3M*$989.0M +$75.7M*
Primary EPS ($USD)$0.30884*$0.4985* (SPGI basis); diluted EPS $0.42 +$0.1897* (vs SPGI consensus)
EBITDA ($USD Millions)$448.8M*Adjusted EBITDA $549.0M +$100.2M*

Values retrieved from S&P Global.* Note: S&P Global “Primary EPS” may differ from GAAP diluted EPS due to normalization methodology.

Key Takeaways for Investors

  • Broad-based strength with revenue +45% YoY and margin expansion; beats across revenue, EPS, and EBITDA vs S&P Global consensus support estimate upward revisions on transaction revenue and EBITDA margins .
  • Mix shift and feature velocity are sustaining engagement: options/crypto/equities volumes and net interest revenue growth from cash sweep, margin balances, and securities lending provide multi-engine revenue support .
  • Subscription and ecosystem build-out (Gold, banking, credit card) enhance durability of revenue and ARPU; Gold at 3.5M subscribers and ARPU $151 point to monetization improvements .
  • Tokenization/L2 and Bitstamp integration are strategic catalysts, expanding TAM, improving pricing for high-volume traders, and enabling 24/7 trading and self-custody pathways over time .
  • Watch expense trajectory: FY25 Adjusted OpEx+SBC raised to include Bitstamp; continued discipline and AI-enabled efficiencies are critical to preserving margin leverage .
  • Non-GAAP and special items: Q4 2024 results included one-time tax and accrual benefits; current quarter margins reflect core performance; investors should anchor on Adjusted EBITDA/OpEx trends .
  • Near-term setup: Management cited a strong July start to Q3 with ~$6B net deposits and record trading volumes—potential positive estimate revisions if momentum persists .