What Happened?
Shares of financial services company Robinhood (NASDAQ:HOOD) jumped 6.8% in the morning session after the stock rebounded from a recent sell-off that was triggered by its fourth-quarter earnings report, which missed revenue expectations.
The initial drop happened after the company posted fourth-quarter revenue of $1.28 billion, which fell short of analyst forecasts. This miss was driven mainly by a 38% decline in revenue from cryptocurrency transactions. However, the rebound suggested investors looked past the crypto weakness and focused on other parts of the business that showed strength.
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What Is The Market Telling Us
Robinhood’s shares are extremely volatile and have had 58 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock dropped 8.5% on the news that the company reported fourth-quarter financial results that missed revenue expectations, driven by a sharp decline in cryptocurrency trading activity. While Robinhood's total revenue grew 27% year-over-year to about $1.28 billion, it fell short of analysts' forecasts, which were closer to $1.34 billion. The main cause of the shortfall was a significant 38% drop in revenue from crypto transactions, which landed at $221 million for the quarter. This decline was linked to weaker trading volumes in the crypto market. Although the company's earnings per share of $0.66 beat expectations, investors appeared to focus more on the revenue miss and the slowdown in the crypto business, which had been a key area of activity for the trading platform.
Robinhood is down 34% since the beginning of the year, and at $76.00 per share, it is trading 50.1% below its 52-week high of $152.46 from October 2025. Investors who bought $1,000 worth of Robinhood’s shares at the IPO in July 2021 would now be looking at an investment worth $2,183.
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