• Robinhood reported a 16% increase in net revenue for Q1 2023, with transaction-based revenues rising 11%.
• Crypto revenue, however, declined by 1%, and was down 30% year over year.
• Interest revenue increased 25% to $208 million due to rate hikes from the Federal Reserve.
Robinhood Reports Record Q1 Revenue
Robinhood announced its first quarter results on Wednesday, reporting a 16% increase in net revenue to $441 million. Transaction-based revenues rose 11%, including a 7% increase in options revenue and a 29% increase in equities revenue. Despite this overall growth, crypto revenues declined by 1% during the same period.
Crypto Revenue Down Year Over Year
The company’s crypto transaction revenues were down 30% year over year from $54 million in Q1 2022. This trend may be attributed to the digital asset valuations which were significantly higher last year compared to now.
Interest Revenue Soars Thanks To Federal Rate Hikes
In spite of the downward trend of crypto transactions, Robinhood’s interest revenue surged 25%, reaching $208 million for the quarter – thanks largely to rate hikes from the Federal Reserve beginning last year which drove both digital assets and tech stocks down at the same time.
Robinhood Launches 24-Hour Market
On top of that, Robinhood also launched its 24-Hour Market feature giving 24/5 trading access to ETFs and popular stocks such as Tesla (TSLA), Amazon (AMZN), and Apple (AAPL). Crypto can already be traded 24/7 on the platform.
Conclusion
Overall, Robinhood had an impressive first quarter despite declining crypto transaction revenue – with its interest income more than making up for it thanks to rate hikes from the Federal Reserve. The platform took advantage of this momentum by launching its 24-Hour Market feature as well as providing users with more access to traditional investment vehicles like ETFs and stocks.