Robinhood shares fall as crypto markets chill drives profit miss

Oct 28 — Robinhood's shares fell 8% in premarket trading on Wednesday after ​a prolonged chill in crypto markets dragged the trading platform's third-quarter profit below Wall Street expectations.

Crypto markets ‌have been under pressure this year due to shifting expectations for US ⁠interest rates, outflows from bitcoin ​exchange-traded funds and bouts ⁠of risk aversion that have unsettled investors and sparked ‌waves of selling.

Here are ‌more details:

• Robinhood's cryptocurrencies revenue fell 55% in ⁠the third quarter to $120 million

• ⁠Rising oil prices and geopolitical tensions have added to market jitters, while heightened volatility has prompted retail traders to pull back from speculative bets

• Robinhood's per-share quarterly profit declined 16% to 51 cents and missed Street ‌expectations of 55 cents, according to ​estimates compiled by LSEG

• Bitcoin, the world's largest digital asset by market cap, has fallen nearly 28% over the past 3 months

• Despite the quarter's volatility, Wall Street analysts remain optimistic about Robinhood's long-term growth prospects

• "We see Robinhood's legacy brokerage business continuing to perform well in ​what we see as a near-perfect environment for retail traders," ‌J.P. Morgan's Kenneth ‌Worthington ⁠wrote in a note

• The company, once heavily reliant on market-sensitive transaction revenue and retail trader sentiment, has rapidly expanded its product offerings in recent years, broadening its business ‌into a full-service financial ​services firm

• Its total net ‌revenue increased 12% in ⁠the third ​quarter to $1.42 billion

(Reporting by Manya Saini in Bengaluru; Editing by ​Shinjini Ganguli)

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