Robinhood (NASDAQ:HOOD) Slides as Prediction Markets Surpass Crypto

NEW YORK, July 29, 2026, 17:05 EDT. Robinhood NASDAQ:HOOD shares fell as prediction markets gained ground over cryptocurrencies.

Second-quarter revenue hit a record, climbing 32% to $1.308 billion. Diluted earnings per share were $0.62.
Event-contract revenue reached $156 million, surpassing cryptocurrency revenue, which stood at $100 million.
Shares fell 3.3% in after-hours trading. Coinbase is set to report results on Thursday.

Robinhood’s shares declined by 3.3% in after-hours trading on Wednesday, even though it posted earnings that surpassed expectations. The stock stood at $86.89 as of 4:59 p.m. EDT, following a regular session close down 3.2% at $89.84. The main session had finished, while after-hours trading was ongoing.

Revenue increased by 32% to an all-time high of $1.308 billion. Diluted earnings per share came in at 62 cents, beating the 43-cent consensus estimate from Wall Street.

The clearer indication for investors was evident in the revenue breakdown. Event contracts brought in $156 million, surpassing the $100 million generated by crypto.

Overall company figures indicate event-contract revenue increased by approximately $146 million compared to a year ago, accounting for about 62% of the $237 million rise in transaction revenue. Revenue from crypto declined $60 million.

Q2 transaction stream	Revenue	Year-on-year change	Share of transaction revenue
Options	$342 million	Up 29%	44.1%
Event contracts	$156 million	Over tenfold increase	20.1%
Equities	$129 million	Up 95%	16.6%
Cryptocurrency	$100 million	Down 38%	12.9%
Other transactions	$49 million	Up 29%	6.3%

Robinhood’s disclosed transaction volume of $776 million serves as the basis for calculating Mix shares.

Options continued to dominate trading, accounting for 44.1% of the total. Event contracts increased to take a 20.1% share, while crypto declined to 12.9%.

Event contracts made up 11.9% of overall company revenue. Revenue from cryptocurrency accounted for 7.6%.

Chief Financial Officer Shiv Verma told MarketWatch that “a lot of our customers are net buyers.” Verma noted that fluctuations in the market had prompted users to increase exposure to technology. MarketWatch

Uncertainty over oil, inflation and interest rates increased following the U.S.-Iran conflict. Reuters reported that these disruptions led to higher trading activity and renewed portfolio adjustments.

The headline profit figure lacks context. The reported earnings reflect a 14-cent contribution from a $129 million deconsolidation gain. Subtracting this mechanically results in 48 cents, which remains higher than consensus. This does not represent a company-adjusted number.

Adjusted EBITDA, which tracks operating profit, increased by 35% to $741 million. The margin improved to 57%, up from 56% a year ago.

Management reduced its 2026 adjusted expense forecast to a range of $2.675 billion-$2.775 billion, down from the prior estimate of $2.7 billion-$2.825 billion.

The number of funded customers climbed to 28.4 million. Platform assets increased by 32% to $369 billion, as quarterly net deposits totaled $21.7 billion.

Coinbase Global NASDAQ:COIN is set to announce earnings Thursday following the close of U.S. markets. Fortune referenced a preliminary consensus estimating revenue near $1.3 billion and a loss of 36 cents per share.

The revenue projection is nearly aligned with Robinhood’s reported total. Market valuations, however, were far apart.

At Wednesday’s close, Robinhood held a market capitalization of $82.2 billion, while Coinbase stood at $42.4 billion. This puts Robinhood’s valuation at roughly 1.9 times that of Coinbase.

A significant portion of that premium is now tied to a business that was barely noticeable a year ago. Event contracts accounted for the majority of Robinhood’s transaction-revenue increase this quarter.

Risks persist. Event-contract revenue could fluctuate depending on the timing of events. Robinhood cautions that regulatory measures or lawsuits might limit the offering. Crypto transaction volume dropped 39% compared to the previous quarter.

Early July figures indicated that average daily volumes for equities, options and event contracts were close to those in the second quarter. Net deposits remained around $4 billion, not counting Trump Accounts.

Coinbase’s earnings update on Thursday will be a key test for that valuation difference.

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Further analysis

Editorial insight

What caused HOOD to decline even with solid Q2 performance?

HOOD ended regular trading on Wednesday at $89.84, falling 3.15%. In after-hours trading, the most recent delayed price was $86.89, down an additional 3.28%. There is no definitive, single factor on record clarifying the immediate selling following results. Market participants appeared to weigh weaker crypto revenue and uncertainty over event-contract momentum. Broader risk sentiment was also dented, with the Nasdaq Composite declining 1.74%. MarketWatch

Did Robinhood actually surpass Wall Street’s Q2 forecasts?

Revenue set a new high at $1.308 billion, up 32% compared to a year earlier. Diluted EPS came in at $0.62, above the average forecast of about $0.43. Of this, $0.14 per share reflected an RVI deconsolidation gain. Excluding that, core quarterly EPS was approximately $0.48. This result remained ahead of the higher consensus estimate before results. Robinhood Markets, Inc.

What factors led to Robinhood achieving its highest-ever quarterly revenue?

Transaction-based revenue climbed 44% year on year, reaching $776 million. Options accounted for $342 million, marking a 29% increase from the same quarter last year. Equities brought in $129 million, and event contracts delivered $156 million. As a result, event contracts made up about one-fifth of total transaction-based revenue. Net interest revenue grew 9% year over year to $389 million. Robinhood Markets, Inc.

What is the extent of the cryptocurrency slowdown?

Cryptocurrency revenue declined 38% compared with the previous year, reaching $100 million. This marked a 25% drop from the first quarter. On the Robinhood App, crypto volume fell 23% quarter on quarter to $18.3 billion. Bitstamp saw a 47% sequential reduction in crypto volume, registering $22.1 billion for the quarter. Crypto accounted for roughly 13% of overall transaction revenue. This diversification reduces the impact, but does not eliminate it. Robinhood Markets, Inc.

Is customer growth along with net deposits remaining robust?

The number of funded customers grew to 28.4 million, an increase of 1.9 million from the previous year. This figure includes about 300,000 new customers from WonderFi. Gold subscribers rose to 4.84 million, reflecting a 17% adoption rate. Total platform assets hit $369 billion, a 32% rise on the year. Net deposits for the quarter amounted to $21.7 billion, equating to a 28% annualized pace. The results indicate robust customer funding activity and steady asset retention. Robinhood Markets, Inc.

Does Q3 have sufficient momentum at the outset?

Executives said average daily volumes in July remained close to the record Q2 levels for equities, options and event contracts. They added that July net deposits were on pace for about $4 billion, not counting flows into Trump Accounts. These are positive signs, but they do not represent official quarterly guidance. Robinhood Markets, Inc.

Are margins and expenses trending positively?

Adjusted EBITDA totaled $741 million, resulting in a quarterly margin of 57%. Adjusted operating expenses, including stock-based compensation, increased by 23% to $641 million. Management revised its full-year 2026 expense guidance downward to a range of $2.675-$2.775 billion, compared to the earlier projection of $2.700-$2.825 billion. While this narrowing offers some benefit, underlying costs continued to rise rapidly in Q2.

Does HOOD remain pricey following its earnings-related drop?

HOOD was last quoted at $86.89 after hours, trading at roughly 38 times its reported trailing EPS. Robinhood’s diluted EPS for the previous twelve months was $2.27. The company posted a $0.14 one-off gain in Q2, slightly reducing the apparent multiple. Without that gain, the approximate valuation climbs to 41 times trailing earnings. Ahead of the results, Wall Street’s average forecast for 2027 stood at $2.72, putting the forward multiple near 32. The shares remain highly valued. MarketWatch

Is Robinhood’s buyback offering significant backing?

Robinhood bought back 4.4 million shares at a cost of $414 million in Q2. Of that, $290 million was linked to the June convertible-notes offering, a sum that operated outside of Robinhood’s existing repurchase plan. The authorised $1.5 billion programme saw just about $130 million spent, leaving around $1.37 billion available at the end of the quarter. Share buybacks may boost per-share valuations, but the company chooses when to execute them. Robinhood Markets, Inc.

What is the projected share price for HOOD over the next 12 months?

Analysts currently have an average target of $125.19, with estimates ranging from $78 to $160. That average target is approximately 44% higher than the after-hours price of $86.89. Most analyst targets are likely from before the latest post-earnings updates. My base-case outlook for the next twelve months is $100 to $125 per share. If retail trading activity remains elevated, prices could stabilize in the $135-$150 area. Conversely, declines in event-driven trading, crypto activity, regulatory changes, or Nasdaq weakness could see shares move toward $70-$80. MarketWatch

Shan Ahmed Khan Latest posts

Shan Ahmed Khan is a senior markets reporter at TS2.tech, specializing in stocks, technology and macroeconomic trends. A graduate of the Lahore University of Management Sciences (LUMS), he previously worked in investment research and market analysis. His coverage helps readers understand the key developments influencing global financial markets and emerging industries.

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