CRYPTO NEWS: ROBINHOOD GIVES A SURPRISING INCOME BEAT FROM LOWER OPERATIONAL COSTS.

ROBINHOOD GIVES A SURPRISING INCOME BEAT

ROBINHOOD GIVES A SURPRISING INCOME BEAT FROM LOWER OPERATIONAL COSTS. WITH ITS SHARE PRICE INCREASING IN LATE TRADING TODAY ON AN UNEXPECTED EARNINGS BEAT IN ITS FISCAL THIRD QUARTER, ROBINHOOD MARKETS INC. DEFIED BOTH MARKET TENDENCIES AND ITS OWN PAST HISTORY.

ROBINHOOD GIVES A SURPRISING INCOME BEAT FROM LOWER OPERATIONAL COSTS:

ROBINHOOD ANNOUNCED A NET LOSS OF $175 MILLION, OR 20 CENTS PER SHARE, FOR THE THREE MONTHS THAT ENDED ON SEPTEMBER 30. THIS IS A DECREASE FROM THE SECOND QUARTER’S NET LOSS OF $295 MILLION, OR 34 CENTS PER SHARE. AT $361 MILLION, REVENUE INCREASED 14% SEQUENTIALLY. ANALYSTS HAD ANTICIPATED A LOSS OF 29 CENTS ON $355.6 MILLION IN REVENUE.

ROBINHOOD GIVES A SURPRISING INCOME BEAT
ROBINHOOD GIVES A SURPRISING INCOME BEAT FROM LOWER OPERATIONAL COSTS

THE COMPANY’S CRYPTOCURRENCY TRADING BUSINESS, WHICH WAS A MAJOR FACTOR IN THE COMPANY’S SUCCESS AND ALLOWED IT TO GO PUBLIC IN JULY 2021, IS STILL STRUGGLING, EVEN THOUGH THE HEADLINE NUMBERS ARE UNDOUBTEDLY GOOD FOR ROBINHOOD.

THE TOTAL AMOUNT OF TRANSACTION-BASED REVENUE INCREASED BY 3% TO $208 MILLION DURING THE QUARTER, ALTHOUGH THIS INCREASE WAS MOSTLY DUE TO THE TRADING OF OPTIONS, WHICH INCREASED BY 10% FROM THE PREVIOUS QUARTER, AND EQUITIES, WHICH INCREASED BY 7%. CONVERSELY, THE TRADING OF CRYPTOCURRENCIES FELL BY 12% TO $51 MILLION.

OPERATING COSTS DECREASED 5% IN THE QUARTER TO $425 MILLION, INCLUDING $90 MILLION IN IMPAIRMENT CHARGES, WHICH ROBINHOOD IS ADDRESSING THROUGH LAYOFFS FIRST ANNOUNCED IN APRIL AND SUBSEQUENTLY EXPANDED UPON IN AUGUST. OPERATING EXPENSES WERE $335 MILLION AFTER SHARE-BASED COMPENSATION AND RESTRUCTURING CHARGES, AN INCREASE OF $94 MILLION OVER THE PREVIOUS QUARTER.

NET CUMULATIVELY FUNDED ACCOUNTS INCREASED BY 60,000 TO 22.9 MILLION, MONTHLY ACTIVE USERS DECLINED BY 1.8 MILLION OVER THE PRIOR QUARTER, AND ASSETS UNDER CUSTODY INCREASED BY 1% TO $64.6 BILLION. AVERAGE REVENUES PER USER ROSE FROM $56 IN THE SECOND QUARTER TO $63 IN THE THIRD, INDICATING A POTENTIAL RECOVERY.

THE QUARTER’S STANDOUTS INCLUDED ROBINHOOD ENABLING CUSTOMERS TO TRADE OPTIONS IN CASH ACCOUNTS, THE RELEASE OF NEW GRAPHS THAT GIVE ADVANCED USERS EXTRA FEATURES, AND THE LAUNCH OF ROBINHOOD WALLET, A WEB3 WALLET THAT ENABLES USERS TO EXCHANGE AND TRADE CRYPTOCURRENCIES WITHOUT PAYING NETWORK FEES.

ACCORDING TO A STATEMENT FROM JASON WARNICK, CHIEF FINANCIAL OFFICER OF ROBINHOOD, “WE STAYED FOCUSED ON SERVING OUR CLIENTS AND GENERATING LONG-TERM SHAREHOLDER VALUE IN Q3.” WE INCREASED REVENUES AND DECREASED EXPENSES TO PRODUCE POSITIVE ADJUSTED EBITDA (PROFITS BEFORE INTEREST, TAXES, DEPRECIATION, AND AMORTIZATION).

ROBINHOOD GIVES A SURPRISING INCOME BEAT FROM LOWER OPERATIONAL COSTS

IN LIEU OF ESTIMATING REVENUE OR EARNINGS FOR THE UPCOMING QUARTER, ROBINHOOD STATED THAT IT ANTICIPATED GAAP EXPENSES FOR THE FULL YEAR 2022 TO BE WITHIN THE RANGE OF $2.34 BILLION TO $2.4 MILLION, A REDUCTION OF 31% TO 32% FROM THE PREVIOUS YEAR. IT IS ANTICIPATED THAT TOTAL OPERATING EXPENSES, EXCLUDING SHARE-BASED COMPENSATION, WILL BE $1.69 BILLION TO $1.71 BILLION, DECREASING 9–10% FROM THE PREVIOUS YEAR.

THE FACT THAT ROBINHOOD HAS KEPT ITS EXPENSES UNDER CONTROL WAS ONE OF THE REASONS WHY INVESTORS LIKED THE DATA. IN LATE TRADING, THE COMPANY’S STOCK INCREASED BY 2.63%.

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CRYPTO NEWS: ROBINHOOD GIVES A SURPRISING INCOME BEAT FROM LOWER OPERATIONAL COSTS.

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