Hood Q2 Earnings Top On Trading & Platform Asset Growth, Stock Dips

Robinhood Markets, Inc. HOOD reported second-quarter 2026 earnings of 62 cents per share, beating the Zacks Consensus Estimate of 44 cents by 40.9%. The bottom line increased 48% year over year. 

The reported quarter included $129 million, or 14 cents per share, of gains primarily related to the deconsolidation of Robinhood Ventures Fund I. Excluding this, underlying earnings were 48 cents per share.

HOOD shares fell 1.6% in after-hours trading on continued crypto weakness.

Strong options, equities and event-contract activity amid heightened volatility led to an increase in transaction-based revenues. Further, higher net interest revenues (NIR), rising platform assets and a surge in Gold subscribers were tailwinds. However, continued weakness in crypto trading volume and higher operating expenses were the headwinds.

Net income climbed 48% to $573 million.

Robinhood's Revenue Mix Broadens

Total net revenues climbed 32% from a year ago to $1.31 billion. The top line surpassed the consensus mark of $1.26 billion.  

NIR increased 9% year over year to $389 million. Growth in interest-earning assets helped offset the impact of lower short-term interest rates and weaker securities-lending activity.

Other revenues climbed 54% to $143 million. The increase reflected Trump Account service revenues and higher Robinhood Gold subscription revenues. The quarter included $25 million of service revenues related to Trump Accounts.

Average revenue per user rose 24% year over year to $187. Robinhood also expanded the number of business lines generating at least $100 million in annualized revenues to 13, with Robinhood Legend and the Credit Card business joining the group.

HOOD's Trading Revenues Accelerate

Transaction-based revenues increased 44% year over year to $776 million. Options revenues rose 29% to $342 million, while equities revenues surged 95% to $129 million. Event-contract revenues jumped more than tenfold to $156 million.

Cryptocurrency revenues remained a weak spot, declining 38% to $100 million. Crypto notional volume totaled $40.4 billion, including $18.3 billion from the Robinhood app and $22.1 billion from Bitstamp. Overall crypto volume fell 39% sequentially.

Trading engagement remained strong elsewhere. Equity notional volume advanced 85% year over year to a record $956 billion, while options contracts traded grew 50% to a record 774 million. Event contracts traded reached a record 13.6 billion.

HOOD's Customer Assets Reach New Highs

Funded Customers increased 7% year over year to 28.4 million, including roughly 300,000 customers added through the WonderFi acquisition. Investment Accounts rose 9% to 29.9 million.

Total Platform Assets advanced 32% to $369 billion, aided by continued net deposits and higher equity valuations. These benefits were partly offset by lower cryptocurrency valuations. Average platform assets per funded customer reached $13,000.

Net deposits totaled a record $21.7 billion, representing a 28% annualized growth rate. Robinhood Retirement assets under custody surged 82% to a record $34.5 billion.

Robinhood Gold subscribers increased 39% year over year and 11% sequentially to 4.84 million. Gold adoption reached 17% of funded customers, up from 13.1% a year earlier. The company noted that roughly 40% of new funded customers enrolled in Gold during the quarter. Annualized Gold subscription revenues reached $216 million. 

Other wealth products also gained traction. Robinhood Strategies grew to more than 300,000 funded customers and nearly $2 billion in assets under management. Robinhood Banking ended June with more than $3 billion in deposits from over 240,000 funded customers.

Robinhood’s Costs Up on Growth Investments

Total operating expenses increased 33% year over year to $734 million. The increase reflected marketing and growth investments, restructuring charges and expenses related to Trump Accounts and Rothera.

Adjusted operating expenses and share-based compensation rose 23% to $641 million. 

HOOD’s profitability remained solid despite the higher expense base. Adjusted EBITDA increased 35% to $741 million, while the adjusted EBITDA margin improved to 57% from 56% a year earlier.

HOOD’s Buybacks and 2026 Expense Outlook in Focus

Robinhood continued returning capital to shareholders. The company repurchased $414 million of Class A common stock during the quarter, representing 4.4 million shares at an average price of approximately $94 each. This included $290 million of repurchases tied to its June convertible-notes offering and conducted outside the existing authorization.

Since launching its initial repurchase program in the third quarter of 2024, HOOD has bought back $1.3 billion, or 27 million shares, at an average price of roughly $47.

Robinhood lowered and tightened its 2026 adjusted operating expenses and share-based compensation outlook to $2.675-$2.775 billion from the prior range of $2.7-$2.825 billion. The revised forecast reflects efficiency gains that helped fund costs associated with Rothera and WonderFi.

Our View on Robinhood

Robinhood’s solid transaction-based revenues, product expansion efforts and higher interest-earning assets, alongside a solid balance sheet, will aid its financials. Further, the company’s initiatives to expand globally will drive growth. Rising expenses, crypto volatility and excessive regulatory risks are major headwinds.
 

Currently, Robinhood carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of HOOD’s Peers

Charles Schwab’s SCHW second-quarter 2026 adjusted earnings of $1.62 per share outpaced the Zacks Consensus Estimate of $1.53. The bottom line soared 42% year over year.

Schwab’s results benefited from the robust performance of the asset management business and record trading revenues. Higher NIR and solid brokerage account numbers were other positives. However, an increase in expenses was the undermining factor. 
 
Interactive Brokers Group’s IBKR second-quarter 2026 adjusted earnings per share of 69 cents surpassed the Zacks Consensus Estimate of 64 cents. The bottom line reflected a rise of 35.3% from the prior-year quarter.

Results primarily benefited from an increase in revenues, growth in customer accounts and a rise in daily average revenue trades. However, higher expenses were the headwind for Interactive Brokers.

Beyond Nvidia: AI's Second Wave Is Here

The AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. AI’s second wave is moving from infrastructure to implementation and these companies are at the forefront of this transition, positioned to become what Amazon and Google were to the internet era.

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research