A sharp fall in crypto trading revenue overshadowed Robinhood’s broader growth, with newer products such as prediction markets emerging as an increasingly important revenue stream.
Robinhood missed analyst expectations in the first quarter of the year, despite revenue growth, as a sharp downturn in crypto trading weighed on performance.
In its Q1’ 2026 financial report released on 28 April, Robinhood posted transaction-based revenues of $623m (+6.8% YoY), net interest revenues of $359m (+23.7% YoY), and other revenues of $85m (+57.4% YoY).
This failed to meet analysts’ projections of $1.13-$1.17bn as crypto revenue fell nearly 50% to $134m, from $252m the same period last year. Crypto trading volume also slumped by 48% in the quarter, making it the third consecutive quarter the company’s transaction revenue has decreased.
The company attributed this to the “ongoing decline in Bitcoin and other crypto asset prices”. After reaching all-time highs of $124,000 in July 2025, Bitcoin’s price has slumped ever since during various macroeconomic conditions, currently priced at just over $77,000 as of the time of writing.
Robinhood’s crypto assets trading volume is tied to the dollar amount of each asset bought or sold. As a result, commission and spread revenue were even more affected by the decline in prices of crypto assets; the company labelled recent fluctuations as a “blood bath”.
While Robinhood’s trading volume declined to $22bn, its integrated exchange Bitstamp posted $42bn in volume after acquiring one of the longest-running crypto exchanges in 2024. However, Bitstamp’s volume did not offset retail revenue on Robinhood’s crypto exchange.
As a result of failing to hit analysts forecasts, Robinhood’s stock price dropped by 8% in after-hours trading, closing at $74.41 at the close of day on NASDAQ.
Could prediction markets be Robinhood’s latest revenue win?
Amid the increases in revenue, the company saw a significant 320% increase in other transaction revenue, which was largely supported by the growth of prediction market transactions.
Robinhood’s ‘Prediction Markets Hub’ service supported $147m in other transaction revenue after almost all of its event contract bets were placed on February’s Super Bowl LX.
Robinhood also launched a ‘Prediction Markets Hub’ in March 2025 in partnership with Kalshi to allow its users to trade event contracts and place bets on sporting events, or political outcomes, etc.
The company revealed it processed a record 8.8 billion event contracts during the first quarter of the year. Robinhood is also looking to “innovate and acquire or invest in new products”.
The growth of prediction markets has been felt across the financial industry, with many crypto exchanges, such as Coinbase and Gemini, also offering similar services. However, prediction markets still operate in a regulatory grey area.
Coinbase and Gemini were hit with a lawsuit from New York Attorney General, Letitia James last week as she classifies prediction markets as gambling, believing both crypto companies are operating “illegal gambling operations”.
Robinhood’s Prediction Markets Hub is regulated by the US Commodity Futures Trading Commission (CFTC). On 12 April, Robinhood scaled back on the amount of prediction market event contracts it offered in a bid to stamp out insider trading fears.
Shiv Verma, Chief Financial Officer of Robinhood, said: “In Q1, customers remained engaged and rapidly adopted new products, leading to a 20% plus annualised net deposit growth rate, double digit growth across equities and options, and record volumes for prediction markets, futures, and index options.
“We believe there are massive opportunities ahead as we invest for the long term, ship products faster than ever to customers, and deliver value for shareholders.”
‘Trump Accounts’ costs & Subscription Growth
While operating expenses for Q1’ 2026 increased from $557m, to $656m YoY, Robinhood revealed in its financials expenses are set to increase by $100m this year due to its involvement in the US government’s ‘Trump Accounts’ initiative.
This initiative supports more than 60 million eligible American children born between 2025-2028 to provide a minimum of $1,000 of federal investment into a family banking account, which will be accessible once the children turn 18-years-old.
Robinhood acts as the brokerage and trustee, while partner Bank of New York Mellon manages the account, which will launch on 4 July 2026.
Under General and Administrative expenses, Robinhood projects its investment into the Trump Accounts initiative to have cost the company $14m this past quarter, with a further $100m throughout 2026.
Elsewhere, Robinhood also saw its Gold Subscription accounts raise $50m in subscription revenue in Q1. Total subscribers for the Gold Subscription tier increased by 36% YoY to 4.3 million, as the revenue contributed to ‘other revenues’.
The subscription model starts at $5 per month and offers a range of trading and investor tools, such as enhanced data. It also offers subscribers 3.35% APY on brokerage cash and larger amounts of deposits.
