Robinhood reports 55% fall in crypto revenue as Galaxy records $323M profit

• A 55% year-on-year fall left Robinhood's Q3 crypto revenue at $120 million, even as total revenue reached a record $1.42 billion.
• With more than $80 billion in DEX volume and $50 million in fees, Robinhood Chain secured a place among the top five chains by revenue and volume.
• Net income at Galaxy Digital reached $323 million, turning around an $85 million Q2 loss, while adjusted EBITDA came to $455 million.

A 55% year-on-year drop in Q3 crypto revenue contrasted with a sharp rise in total revenue at Robinhood (HOOD), the company reported on Tuesday.

Robinhood lifts total revenue to record $1.42 billion

Robinhood's Q3 earnings statement put crypto revenue at $120 million for the three months ended 30 September. Growth in options trading, equities and event contracts helped total net revenue climb 12% year on year to a record $1.42 billion.

Revenue from event contracts rose more than sixfold from a year earlier to $173 million, alongside a 31% increase in options revenue to $399 million. A 41% rise in equities revenue to $121 million also helped cushion the fall in cryptocurrency-related income.

Net income, however, dropped 14% year on year to $476 million, with diluted earnings per share down 16% at $0.51. Of the net loss, the company attributed $67 million to unrealised losses, chiefly linked to the valuation of Robinhood Ventures Fund I.

In the earnings release, Robinhood's Chief Financial Officer Shiv Verma said: “Customers are trusting us with more of their assets as we deliver on our product roadmap, leading to our highest quarter ever for revenues,”

On a quarterly basis, crypto revenue rose 20% to $120 million, despite the year-on-year decline. Crypto notional trading volume, meanwhile, was down 38% year on year at $50 billion, the company reported. Volumes on Robinhood App fell 48% to $21 billion, while those on Bitstamp dropped 28% to $29 billion.

In its first quarter on mainnet, Robinhood Chain generated more than $80 billion in decentralised exchange (DEX) volume and over $50 million in chain fees, placing it among the top five chains by revenue and volume.

After ending the session 1.8% higher at $94.56, HOOD has since lost more than 7% in after-hours trading.

Galaxy Digital returns to profit with $323 million in Q3

For Q3, Galaxy Digital (GLXY) posted net income of $323 million, recovering from the previous quarter's $85 million net loss.

Against a $77 million loss in Q2, adjusted EBITDA came in at $455 million. Adjusted gross profit increased from $43 million to $569 million.

Contributions from the digital asset business, investment portfolio and data centre operations were reflected in the company's results. Much of the improvement came from the Treasury and Corporate segment, which recorded $419 million in gross profit as valuations of digital asset holdings and private investments increased.

Adjusted gross profit in Galaxy's Digital Assets segment increased from $66 million in the previous quarter to $71 million. Alongside a 12% quarter-on-quarter rise in trading volumes, the average loan book grew 27% to $1.8 billion.

A 9.5% gain on the day took GLXY to a closing price of $17.18.