Robinhood said on Wednesday that fees on
cryptocurrency trading were for 41% of its overall income in the second
quarter, up from 17% in the first. Over 60% of its clients exchanged cryptos in
the quarter, according to the company.
• Cryptocurrency-based revenue was $233 million in
the second quarter, up from $5 million the year before.
• The trading of dogecoin accounted for 62 percent
of Robinhood's cryptocurrency income in the second quarter, up from 34 percent
in the first quarter.
• In its earnings report, Robinhood identified this
significant dependence as a concern. “Our business, financial health, and
results of operations may be negatively impacted if demand for Dogecoin
transactions decreases and is not replaced by fresh demand for other
cryptocurrencies accessible for trade on our platform,” the firm said.
• Robinhood's first earnings report as a public
business was released on Wednesday. Overall, the firm lost $2.16 per share,
against consensus expectations of 26 cents per share. It made $565 million in
sales, above expectations of $559.5 million.
• The firm also said that it expects decreased
sales in the third quarter. “We anticipate reduced revenues and significantly
fewer funded accounts for the three months ending September 30, 2021, as a
consequence of seasonal headwinds and decreased trading activity throughout the
industry,” the firm said.
• Following the publication of the report, shares fell almost 6% to $46.94 in after-hours trade on Wednesday. The business went public on July 28 with an IPO price of $38 per share and a first-day trading loss of 8%.
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