Robinhood Markets Inc. (NASDAQ:HOOD) shares are trading lower Wednesday after the company reported third-quarter financial results and announced it is not providing a 2026 outlook for total operating expenses. The company received a cease and desist letter from the Ohio Casino Control Commission demanding that it stop offering sports-related event contracts in the state.
- Robinhood stock is showing notable weakness. Why are HOOD shares down?
Robinhood Edges Past Estimates With a Record Revenue Quarter
Robinhood reported third-quarter adjusted earnings per share of 60 cents, beating the consensus estimate of 56 cents. It reported revenue of $1.424 billion, up 12% from a year earlier and a company quarterly record, just ahead of the consensus estimate of $1.422 billion. Total operating expenses rose 16% to $739 million, driven by higher provisions for credit losses as it grows its credit card loan book, costs related to Trump Accounts and Rothera, and marketing and growth investments.
Event Contracts and Options Lead Transaction Revenue, While Crypto Falls 55%
Transaction-based revenue was $867 million, up 19% from a year earlier. Event contracts brought in $173 million, up more than sixfold, on a record 16.4 billion contracts traded. Options revenue rose 31% to $399 million, equities rose 41% to $121 million and cryptocurrencies fell 55% to $120 million. Other revenue rose 61% to $142 million, driven mainly by Trump Account service revenues and higher Robinhood Gold subscription revenue.
Net Deposits Hit $16 Billion, and Robinhood Adds 1.9 Million Funded Customers
Net deposits were $16 billion. Funded customers rose by 1.9 million to 28.7 million, and average revenue per user rose 5% to $200. Robinhood Gold subscribers reached a record 5.2 million, and the company now has 14 business lines with $100 million or more in annualized revenue, with Rothera becoming a new one this quarter.
“We’re entering Q4 with strong momentum, as October Net Deposits have already topped $13 billion month-to-date, including $6 billion from the Dell family’s contribution to Trump Accounts,” said Shiv Verma, Robinhood’s chief financial officer.
Robinhood Agrees to Stop New Sports Event Contracts in Ohio by Nov. 2
Robinhood received a cease and desist letter from the Ohio Casino Control Commission on Oct. 2, demanding that it stop offering sports-related event contracts in the state, according to its quarterly filing. On Oct. 26, Robinhood agreed to stop offering new sports-related event contracts in Ohio by Nov. 2, in exchange for the commission’s agreement not to enforce its state gaming laws while Robinhood’s and other prediction-market operators’ appeals proceed in the Sixth Circuit and the Supreme Court.
Robinhood Does Not Provide a Total Operating Expense Outlook
Robinhood said it is not providing a 2026 outlook for total operating expenses because it cannot predict with reasonable certainty the impact of items such as provisions for credit losses and significant regulatory expenses, which could be material.
Analyst Consensus & Recent Actions
The stock carries a Buy rating with an average price forecast of $137.22. Recent analyst moves include:
- Truist Securities: Buy (Lowers Target to $125.00) (Oct. 28)
- Rosenblatt: Buy (Maintains Target to $135.00) (Oct. 28)
- BTIG: Buy (Maintains Target to $135.00) (Oct. 28)
Robinhood Shares Edge Lower
HOOD Price Action: At the time of publication, Robinhood shares are trading 6.40% lower at $88.51, according to data from Benzinga Pro.
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