Robinhood (HOOD) shares fell sharply on the back of the company’s third-quarter results, which were below the expected cryptocurrency trading earnings.
The popular retailer released its third-quarter report on October 26, with the cryptocurrency valued at $51 million (19%) out of $267 million in total transaction revenue for the quarter.
Tuesday’s release of the report coincided with a drop in HOOD of about 10% to $35.70, but the price has since risen 1.9% to $36.40 at the time of writing.
The $51 million cryptocurrency raised in the third quarter represented a 78% drop from the company’s record $233 million in the second quarter. Robinhood’s crypto revenue last quarter was boosted by the Dogecoin (DOGE) community, with memcoins making up 62% of crypto revenue.
The company’s total net income for the quarter was $365 million, according to FactSet, well below Wall Street analysts’ expectations of $437.1 million.
Robinhood said in its third quarter report that several factors affected the business, including seasonal volatility, market volatility, retail behavior and unexpected market events. The company said the same problems may persist into the fourth quarter.
“In the absence of changes in the market environment or external events, we believe this could result in quarterly revenue of no more than $325 million and annual revenue of less than $1.8 billion,” the report says.
With the rejection of cryptocurrency, Robin Ten CEO Robin Tenev expressed optimism about the company’s long-term outlook for digital assets, highlighting new products and services created for retailers in the third quarter, such as a digital wallet that will finally open up user access. To remove and enter cryptocurrency to and from the platform:
“To date, more than 1 million people have signed up for the crypto queue. With 24/7 phone support, we believe Robinhood has become the most reliable and intuitive platform for retail and crypto investors.”
“Looking forward, we are committed to providing retirement tax accounts to help everyone invest in the long-term,” he added.
About it: Robinhood’s crypto queue reaches 1 million people
On the broader spectrum of cryptocurrency, the company’s total net income of $365 million is down 35% from the previous quarter, according to Robinhood’s Q3 report. The company’s net loss was $1.32 billion, or $2.06 per diluted share, compared to a loss of $502 million, or $2.16 per share, in the second quarter.
The number of monthly active users also decreased from 21.3 million in the second quarter to 18.9 million in the fourth quarter. However, Robinhood’s user base may increase in the fourth quarter, and there are rumors in the Shiba Inu (SHIB) community that a dog token could soon be on the platform.
However, there is no evidence to support this. On October 23, Robinhood sent out a survey to its customers about the cryptocurrencies they have purchased in the past three months and SHIB is on the list.
According to CoinGecko, the price of SHIB has increased by about 69% over the past seven days to $0.000004759 at the time of writing, while the value of the asset is up 568% over the past 30 days.