Robinhood Beats on Earnings — But Is the Crypto Crash About to Send HOOD Back to $71?

Shares of Robinhood (HOOD) are under pressure following its furth-quarter results , sliding roughly 7% in premarket trade and setting up for a potential retest of the February lows near $71. While the headline numbers were not disastrous—and in some areas were solid—the combination of a revenue shortfall, weakness in crypto activity, and a cautious tone around near-term trading volumes appears to be weighing on sentiment.

On the surface, the quarter looked mixed. Robinhood reported Q4 EPS of $0.66, ahead of consensus expectations around $0.63–$0.64 and roughly in line with bullish analyst models. Revenue rose 27% year over year to $1.28 billion but missed expectations of approximately $1.34–$1.35 billion. The earnings beat was helped by slightly better expense control and a lower tax rate, but investors clearly focused on the top-line miss, particularly given how dependent the model remains on transaction-based activity.

Transaction-based revenue rose 15% year over year to $776 million. Within that segment, equities revenue surged 54% and options revenue climbed 41%, both reflecting elevated trading engagement during much of 2025. Options revenue in particular stood out at $314 million, reinforcing Robinhood’s continued dominance among active retail traders. Equity notional volumes rose 68% year over year to a record $710 billion, while options contracts traded increased 38% to 659 million. These are not the metrics of a platform in retreat.

However, crypto revenue was the weak link. Cryptocurrency revenue fell 38% year over year to $221 million. Notional crypto trading volumes were $82 billion overall, but Robinhood app crypto volumes declined 52% year over year to $34 billion, partially offset by Bitstamp volumes of $48 billion. With crypto-linked revenue historically a key swing factor in Robinhood’s results, the decline underscores the cyclicality embedded in the model. Analysts expect crypto volumes to remain soft over the next couple of quarters before potentially rebounding.

Net interest revenue was another bright spot, increasing 39% year over year to $411 million. This was driven by growth in interest-earning assets and margin balances, though partially offset by lower short-term rates. The margin book jumped 113% year over year to a record $16.8 billion, reflecting strong client appetite for leverage during much of the year. Cash sweep balances rose 26% to $32.8 billion. These trends support the idea that Robinhood is evolving beyond purely transaction-driven revenue.

Beyond trading, Robinhood continues to diversify. Gold subscribers increased 58% year over year to 4.2 million, helping drive 109% growth in “other revenues.” Subscription revenue tied to Gold rose 56%. Retirement assets under custody more than doubled to $26.5 billion, and over 40% of total platform assets now sit across ETFs, advisory, retirement, and cash. Total platform assets climbed 68% year over year to $324 billion, supported by $15.9 billion in Q4 net deposits and $68 billion in deposits for the full year.

Prediction markets remain a notable growth engine. Event contracts traded reached a record 8.5 billion in Q4 and 12 billion for the full year. Management highlighted this as one of the fastest-growing products in company history, with January volumes already hitting new highs. The firm is also working to internalize more of the economics by building a CFTC-licensed exchange and clearinghouse, potentially improving long-term margins in that segment.

From a profitability standpoint, adjusted EBITDA increased 24% year over year to $761 million in Q4, and full-year adjusted EBITDA hit $2.5 billion with margins of 56%. Adjusted operating expenses and share-based compensation rose 18% year over year in Q4, slightly below management’s prior outlook. For 2026, Robinhood guided to adjusted operating expenses and SBC of $2.6–$2.725 billion, representing roughly 18% growth at the midpoint as the company invests in product velocity, marketing, international expansion, and integration of acquisitions like Bitstamp and TradePMR.

Analyst reaction has been constructive but more cautious on near-term revenue. Citizens reiterated an Outperform rating and a $180 price target, citing better expense performance and a broadening revenue base. Needham maintained a Buy rating but lowered its price target to $100, reflecting weaker crypto volumes and some seasonality assumptions in trading activity.

Strategically, management emphasized its “Financial SuperApp” vision and a three-part strategy: leading in active traders, increasing wallet share among the next generation, and building a global financial ecosystem. International expansion is underway, with roughly 750,000 customers outside the U.S. and deeper product rollouts planned in the U.K. and EU.

The key driver of the stock’s weakness appears to be the crypto slowdown and broader trading pullback heading into 2026. Crypto volumes are down sharply year over year, and both options and equity trading have shown signs of moderation more recently. Given that transaction-based revenue still represents more than half of total net revenue, any cyclical slowdown in retail trading flows has an outsized impact on the narrative.

Technically, the stock’s 7% post-earnings decline sets up a potential retest of the February lows around $71. A break below that level could invite further pressure, particularly if crypto remains under stress. Conversely, stabilization in crypto volumes or renewed retail engagement could quickly shift sentiment, given the platform’s strong deposit growth and expanding product suite.

In sum, Robinhood delivered solid EPS, strong engagement metrics, and continued diversification progress. But the revenue miss and sharp decline in crypto activity highlight the cyclicality still embedded in the model. Investors are now recalibrating expectations for 2026 growth, weighing near-term volume softness against long-term platform expansion and improving business mix.