Robinhood Markets (NASDAQ:HOOD) Shares Down 13.2% on Disappointing Earnings

Key Points

• Robinhood reported EPS $0.38 and revenue of $1.07 billion, missing expectations and sending shares down 13.2% intraday on heavy volume.
• Revenue was up about 15% year‑over‑year and profit benefited from prediction‑market fees and Gold subscriptions, but a steep drop in crypto trading revenue and an ~18% rise in operating costs (including a flagged ~$100M onboarding investment) weighed on margins.
• The print prompted analyst target cuts and heavy selling even as some firms remain bullish; insiders have been selling (540,447 shares last quarter) and the consensus rating is a "Moderate Buy" with a ~$110.17 target.

Robinhood Markets, Inc. (NASDAQ:HOOD - Get Free Report)'s share price fell 13.2% during mid-day trading on Wednesday following a dissappointing earnings announcement. The company traded as low as $69.93 and last traded at $71.20. 79,121,570 shares traded hands during mid-day trading, an increase of 156% from the average session volume of 30,891,619 shares. The stock had previously closed at $82.07.

The company reported $0.38 EPS for the quarter, missing analysts' consensus estimates of $0.50 by ($0.12). Robinhood Markets had a return on equity of 22.32% and a net margin of 42.10%.The business had revenue of $1.07 billion for the quarter, compared to analyst estimates of $1.24 billion. During the same quarter in the previous year, the business posted $0.37 earnings per share. The company's revenue was up 15.1% compared to the same quarter last year.

Robinhood Markets News Summary

Here are the key news stories impacting Robinhood Markets this week:

• Positive Sentiment: Underlying growth: revenue rose ~15% year‑over‑year to $1.07B, net deposits were strong and Robinhood Gold subscribers grew materially — evidence the core retail platform is still expanding. GlobeNewswire Q1 Release
• Positive Sentiment: Profit drivers: fee income from prediction markets and higher Gold subscription revenue helped reported profit rise modestly, showing diversification beyond transaction revenue. WSJ article
• Positive Sentiment: Some sell‑side bulls remain: Cantor Fitzgerald and a few other firms reaffirmed overweight/market‑outperform views with mid‑to‑high price targets, leaving upside scenarios if transaction trends normalize. Benzinga price target coverage
• Neutral Sentiment: Macro/sector backdrop is weak: Fed uncertainty and a broadly softer financials patch amplified the reaction to the print — not unique to HOOD. Yahoo Market Coverage
• Neutral Sentiment: Some commentators say the recent weakness may already be priced in, suggesting potential for stabilization if upcoming quarters show recovery in trading volumes, especially crypto. Invezz piece
• Negative Sentiment: Q1 double miss: EPS came in at $0.38 (vs. ~$0.39 consensus) and revenue $1.07B (vs. ~$1.14B), triggering after‑hours selling. Transaction and crypto revenue were the main shortfalls. Investopedia earnings coverage
• Negative Sentiment: Crypto drag: crypto trading revenue plunged (reported declines ~47% in some coverage), removing a previously large earnings tailwind. SiliconANGLE article
• Negative Sentiment: Rising expenses and one‑time investments: operating costs jumped (~18%), and management flagged a ~$100M investment tied to onboarding “Trump accounts,” which reduces near‑term margin visibility. Yahoo Finance expense coverage
• Negative Sentiment: Analyst downgrades/target cuts: several firms trimmed price targets (Barclays to $82, Keefe Bruyette & Woods to $65, Needham lowered its target), increasing near‑term sell pressure. 247WallSt on Barclays cut
• Negative Sentiment: Market reaction: heavy trading and sharp intraday moves — the stock sold off hard after the print, reflecting disappointment and a rotation away from names tied to crypto volatility. WSJ market reaction

Analyst Upgrades and Downgrades

A number of brokerages have issued reports on HOOD. Keefe, Bruyette & Woods decreased their target price on shares of Robinhood Markets from $75.00 to $65.00 and set a "market perform" rating for the company in a research note on Wednesday. New Street Research set a $122.00 target price on shares of Robinhood Markets in a research note on Thursday, March 5th. Mizuho lifted their target price on shares of Robinhood Markets from $105.00 to $115.00 and gave the company an "outperform" rating in a research note on Monday, April 20th. Sanford C. Bernstein reiterated an "outperform" rating and set a $130.00 price target on shares of Robinhood Markets in a report on Tuesday, April 14th. Finally, Weiss Ratings reiterated a "hold (c)" rating on shares of Robinhood Markets in a report on Friday, March 27th. Eighteen analysts have rated the stock with a Buy rating, five have issued a Hold rating and two have issued a Sell rating to the company's stock. Based on data from MarketBeat.com, the company has a consensus rating of "Moderate Buy" and a consensus target price of $110.17.

Insider Transactions at Robinhood Markets

In related news, insider Daniel Martin Gallagher, Jr. sold 10,000 shares of the business's stock in a transaction that occurred on Monday, April 6th. The stock was sold at an average price of $69.85, for a total value of $698,500.00. Following the completion of the sale, the insider directly owned 442,849 shares in the company, valued at approximately $30,933,002.65. The trade was a 2.21% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Shiv Verma sold 5,436 shares of the business's stock in a transaction that occurred on Wednesday, April 15th. The stock was sold at an average price of $85.86, for a total value of $466,734.96. Following the completion of the sale, the chief financial officer owned 52,747 shares of the company's stock, valued at approximately $4,528,857.42. This trade represents a 9.34% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders sold 540,447 shares of company stock worth $40,159,378. 19.95% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Robinhood Markets

Several institutional investors and hedge funds have recently added to or reduced their stakes in HOOD. Empowered Funds LLC lifted its position in Robinhood Markets by 46.7% during the 1st quarter. Empowered Funds LLC now owns 49,870 shares of the company's stock worth $2,076,000 after acquiring an additional 15,885 shares during the last quarter. Arrowstreet Capital Limited Partnership acquired a new position in Robinhood Markets during the 2nd quarter worth $5,105,000. Federated Hermes Inc. lifted its position in Robinhood Markets by 106.2% during the 2nd quarter. Federated Hermes Inc. now owns 63,957 shares of the company's stock worth $5,988,000 after acquiring an additional 32,933 shares during the last quarter. NewEdge Advisors LLC lifted its position in Robinhood Markets by 19.1% during the 2nd quarter. NewEdge Advisors LLC now owns 89,676 shares of the company's stock worth $8,396,000 after acquiring an additional 14,356 shares during the last quarter. Finally, Nebula Research & Development LLC acquired a new position in Robinhood Markets during the 2nd quarter worth $1,316,000. 93.27% of the stock is currently owned by institutional investors and hedge funds.

Robinhood Markets Stock Performance

The stock has a market cap of $64.10 billion, a price-to-earnings ratio of 34.56, a price-to-earnings-growth ratio of 2.52 and a beta of 2.46. The stock's 50-day simple moving average is $76.36 and its two-hundred day simple moving average is $103.05.

About Robinhood Markets

Robinhood Markets, Inc NASDAQ: HOOD is a U.S.-based financial services company best known for its mobile-first brokerage platform that aims to "democratize finance for all." Founded in 2013 by Vladimir Tenev and Baiju Bhatt and headquartered in Menlo Park, California, the company built early traction by offering commission-free trading and a simplified user experience that attracted a large base of retail investors.

Robinhood's core products and services include a mobile app and web platform for trading U.S.

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