Robinhood’s revenue more than doubled in the second quarter to $ 565 million, aided by a large increase in cryptocurrency trading, a stock trading application announced on Wednesday.
But the stock jumped after trading after business hours after warning that a slowdown in trading activity would hit earnings in the current quarter.
In its first income statement as a public enterprise, Robin Hood reported a net loss of $ 502 million, or a loss of $ 2.16 per share, within the expected net loss of $ 487 million to $ 537 million projected by the company. Mediation made a profit in the same quarter last year.
Revenue rose more than 131% from $ 244 million a year ago and was close to the company’s high forecast range of $ 546 million to $ 574 million.
Revenue from cryptocurrency trading was $ 233 million, more than half of all transaction-based revenue of $ 451 million in the second quarter. The share of cryptocurrency revenue jumped to more than 51% from 17% in the first quarter.
More than 60% of cumulative net funded accounts traded crypto in the quarter. In the second quarter of 2020, cryptocurrency revenue was only $ 5 million.
Client options trading contributed $ 165 million and shares accounted for $ 52 million in transaction-based revenue in the last quarter. Robinhood also earns revenue from its gold subscription service.
Trusteeship assets rose 205% to $ 102 billion in the second quarter of 2021, compared to $ 33 billion in the second quarter of last year.
Robinhood warned investors that third-quarter results could be affected by a slowdown in trading after a record second-quarter.
“For the three months ended September 30, 2021, we expect seasonal winds and lower trading activity in the industry to result in lower revenues and significantly fewer new funded accounts than in the previous quarter,” the company said in a statement.
Robinhode shares fell 3% after trading after business hours. Shares of Robinhood jumped 6.7% to $ 49.80 on Wednesday.
Total funded accounts (those linked to a bank account) were $ 22.5 million in the second quarter, according to Robinhood’s forecast. That is more than 18 million in the first quarter of 2021, an increase of 151% over the year before.
Crypto trading, which Robinhood first introduced in 2018, has grown in recent years. Robinhood offers seven different digital coins, including bitcoin, ethereum and litecoin. Dogecoin, a meme-inspired token, makes up 34% of its cryptocurrency revenue from transactions in the first quarter.
Robinhood makes money in cryptocurrencies by redirecting orders to market producers that the company says offer “competitive prices” and taking a percentage of the value of the order. The price of bitcoin hovered around $ 45,000 on Wednesday, up more than 50% from last year.
Robin Hood went public on the Nasdaq last month, it sought to democratize amateur investors in public markets. Since its debut, Robinhead shares have been under scrutiny. After sinking in the first few days of trading, the company had a moment of stock memes when it recovered 50% amid the interest of retail investors.
Earlier this month, news was announced that certain Robinhood shareholders were will eventually sell up to 97.9 million shares sunk shares. Robinhood said the SEC informed the brokerage agency on Aug. 13 that they were reviewing the resale of the S-1 and that the sale could not be made until SEC staff completed the review and declared it effective.