Robinhood’s event-contract revenue reaches $173 million in third quarter

Robinhood’s prediction-market business generated $173 million in event-contract revenue in the third quarter, more than six times its level a year earlier. Customers traded a record 16.4 billion contracts in the three months to Sept. 30, up from 13.6 billion in the second quarter.

As reported in August, event contracts had already overtaken crypto revenue in the second quarter. The gap persisted in the latest quarter: crypto revenue was $120 million, despite rising 20% from the preceding quarter, and was down 55% from a year earlier. Crypto notional trading volume fell 38% year on year to $50 billion.

The event-contract result helped lift Robinhood’s transaction-based revenue 19% to $867 million. Options remained the largest component, rising 31% to $399 million, while equities revenue increased 41% to $121 million. Transaction-based revenue nevertheless came in below the $879 million StreetAccount estimate.

Robinhood also said Rothera, its joint venture with Susquehanna International Group, exceeded a $100 million annualized revenue run rate in its first full quarter. The company classified it as its 14th business line to reach that threshold. More than 6.4 billion contracts have traded on Rothera since its June launch, according to Unchained.

Robinhood stressed that it does not wholly own or operationally control Rothera.

The company reported total third-quarter revenue of $1.42 billion, up 12% from a year earlier and from $1.31 billion in the previous quarter. Diluted earnings per share fell 16% year on year to $0.51, while adjusted earnings per share declined 3% to $0.60.

Funded customers rose by 1.9 million from a year earlier to 28.7 million, and platform assets increased 19% to $396 billion. Robinhood Gold subscriptions reached 5.2 million. Robinhood announced the results on Oct. 27 and said October net deposits had already surpassed $13 billion, including $6 billion from the Dell family’s contribution to Trump Accounts.