Fee-free trading platform Robinhood’s crypto revenue declined 78% in the third quarter this year, earning only US$51 million during that time according to the company’s Q3 report released Tuesday. This is compared to the US$233 million the company earned in the previous quarter in which the market hit the height of the bull run, from which the market spent much of Q3 recovering.
- The firm attributed this in particular to a decline in the price of Dogecoin, the meme-based cryptocurrency whose explosion in popularity earlier in the year helped spur strong sign-ups at the company. The price of Dogecoin jumped roughly 900% in less than a month in May to reach an all-time high of US$0.7376, though quickly receded in the months that followed and has been treading water around US$0.20 ever since, according to data from CoinMarketCap.
- “In Q2, the story was about crypto, especially Doge,” said CFO Jason Warnick in a call with reporters.
- Robinhood earned US$365 million overall in the quarter, down from the US$565 million it earned last quarter but still higher than its Q3 earnings last year. The company saw a loss before income tax of US$1.37 billion, most of which came in the form of share-based compensation expenses based on the company’s initial public offering from earlier in the year.
- In some positive news, company spokespeople said that more than 1 million people had already joined the waitlist for the company’s upcoming crypto wallet.
- Following the release of the underwhelming earnings report, Robinhood’s share price fell 8% in after-hours trading, closing the day at US$39.57, according to data from MarketWatch.