Robinhood Q4 Revenue Misses Estimates on Crypto Drop

Robinhood Markets Inc. reported record fourth-quarter revenue on Tuesday that fell short of analyst expectations, dragged down by a sharp decline in cryptocurrency trading amid a prolonged market downturn. The Menlo Park, California-based online brokerage posted net revenue of $1.28 billion for the three months ended December 31, a 27 percent increase from the year-earlier period but below Wall Street's forecast of $1.34 billion. The company, which caters to retail investors through commission-free trading, saw its shares drop about 7 percent in after-hours trading to around $79, following a 1.1 percent decline during the regular session.

Net income for the quarter totaled $605 million, down 34 percent year over year, while earnings per share came in at 66 cents, edging out estimates of 63 cents. The profit decline stemmed partly from a $56 million income tax provision this quarter, compared with a $358 million tax benefit in the prior year. Transaction-based revenue, a key driver of the company's earnings, rose to $776 million, fueled by gains in equities and options trading. Equities revenue increased 54 percent, while options revenue climbed 41 percent year over year.