Robinhood released its second quarter results, achieving profitability for the first time since becoming a public company, despite a drop in revenue in the second quarter of 2023.
According to its quarterly report released on Aug. 2, Robinhood’s revenue from cryptocurrency transactions shrank by 18% to $31 million. Other transaction-based revenues dropped as well, including Options, which decreased 5% to $127 million, and Equities, which declined 7% to $25 million. Over the past year, its revenue has decreased 4% from $202 million in June last year to $193 million.
In spite of the decline in revenue, the company recorded a net income of $25 million, or earnings per share (EPS) of $0.03, compared with a net loss of $511 million, or EPS of -$0.57, in the first quarter of the year. The result is attributable to improvements in total operating expenses over the past months, with a midpoint decrease of $45 million.
The total assets under custody increased 13% to $89 billion last quarter, driven by “higher equity valuations and continued net deposits.” Taking the first half of 2023 into account, Robinhood slightly increased its crypto assets under custody from 8,431 million in December 2022 to 11,503 million in June 2023.
“In Q2, we reached a significant milestone by achieving GAAP profitability for the first time as a public company,” said Vlad Tenev, CEO and Co-Founder of Robinhood Markets.“ Generally Accepted Accounting Principles (GAAP) refers to the standard accounting principles and guidelines that companies use to prepare their financial statements.
Robinhood’s net deposit was $4.1 billion in the quarter, which translates to an annualized growth rate of 21% relative to assets under custody in the first quarter of 2023. Over the past twelve months, net deposits were $16.1 billion, indicating a growth rate of 25% over a year.
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