Robinhood Markets (HOOD -3.01%), a leading commission-free retail investing platform, reported its second quarter fiscal 2025 earnings on July 30, 2025. The company posted a substantial beat on both GAAP earnings and revenue, fueled by robust growth across transaction-based and net interest income. Earnings per share (GAAP) came in at $0.42, surpassing the consensus estimate of $0.31. Revenue (GAAP) reached $989 million, topping analyst expectations by $74.4 million. Compared to the prior year period, GAAP revenue rose 45% and net income increased 105%. Management described the quarter as one marked by accelerated innovation, stronger customer engagement, and continued expansion, although it did face higher expenses related to recent acquisitions and product rollouts.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP) | $0.42 | $0.31 | $0.21 | 100% |
| Revenue (GAAP) | $989 million | $914.6 million | $682 million | 45% |
| Net Income (GAAP) | $386 million | $188 million | 105% | |
| Adjusted EBITDA (Non-GAAP) | $549 million | $301 million | 82.4% | |
| Adjusted Operating Expenses and SBC (Non-GAAP) | $522 million | $493 million | 5.9% |
Source: Analyst estimates for the quarter provided by FactSet.
Business Overview and Recent Focus
Robinhood Markets is best known for its mobile-first investing app, offering users commission-free trading in stocks, options, exchange-traded funds (ETFs), and cryptocurrencies. Its platform is built for new and experienced investors alike, aiming to simplify access to financial markets through technology and an easy-to-use interface.
Recently, the company has prioritized innovation and product expansion as critical factors for growth. Key areas include the launch of new trading tools like Legend (a customizable desktop platform for active traders), rolling out enhanced features in its retirement and Gold subscription services, and accelerating its push into international markets such as the UK and Europe. Maintaining a strong regulatory compliance framework, integrating recent acquisitions, and providing quality user experience have become increasingly important as Robinhood grows its product lineup and global reach.
Quarter Highlights: Financial and Strategic Drivers
Transaction-based revenues jumped 65% year over year to $539 million, driven by increased trading activity across options, cryptocurrencies, and equities. Options trading revenue hit $265 million, up 46%. Cryptocurrency trading revenue nearly doubled, reaching $160 million, while equities revenue rose to $66 million. The company's net interest revenues climbed 25%, reaching $357 million, reflecting higher interest-earning asset levels and growth in its securities lending program, partly offset by the impact of lower short-term rates.
Robinhood continued to show momentum in expanding its customer base. Funded customer accounts reached 26.5 million, up by 2.3 million or 10% year over year. Investment accounts totaled 27.4 million. The company's average revenue per user (ARPU), a key metric for measuring customer monetization, reached $151, a 34% increase from a year ago. Total platform assets increased 99% year-over-year to $279 billion, driven by continued net deposits, acquired assets, and higher equity and cryptocurrency valuations. Net deposits were $13.8 billion, and over the trailing twelve months totaled $57.9 billion, up 41% from the prior year amount.
Product innovation was a major feature of the quarter. The Robinhood Gold subscription service, which provides customers with premium features like enhanced interest rates, research access, and the new Gold credit card, reached 3.5 million subscribers, a 76% year-over-year jump. Adoption of the Gold Card crossed 300,000 cardholders. Robinhood launched tokenization features and rolled out Stock Tokens for over 200 U.S. stocks and ETFs in Europe. The new Robinhood Strategies digital advisory service attracted more than 100,000 clients, with assets under management (AUM) reaching over $500 million within four months of launch. On the technology front, the company introduced detailed analytics tools to enhance the trading experience for active users.
International and crypto expansion accelerated. The company made its Legend trading platform available to all UK customers and brought its crypto services to 30 European countries. The closed acquisition of Bitstamp, a large crypto exchange, and a pending deal for WonderFi, support an expanding global crypto and trading footprint. Notable customer and trading metrics include $517 billion in equity trading volume (up 112% year-over-year), 515 million options contracts traded (up 32% year-over-year), and $28 billion in crypto trading through the main app (up 32% year-over-year). Bitstamp added $7 billion in crypto trading volume in June 2025, its first post-acquisition month. Retirement products also saw strong inflows, with assets under custody (AUC) for retirement rising to $19.0 billion, up 118% year-over-year.
Rising operating expenses and acquisition integration costs were key factors. Total operating expenses reached $550 million, up 12% year-over-year, while adjusted operating expenses and share-based compensation (SBC) (non-GAAP) landed at $522 million, an increase of 6% year-over-year. The company pointed to Bitstamp integration as a major contributor to the expense uptick. Adjusted EBITDA, a measure of operating performance that excludes interest, taxes, and certain non-cash costs, jumped 82% to $549 million, with margins expanding to 56%. Net income (GAAP) more than doubled to $386 million, while the net margin (GAAP) reached 39%, rising from 28% a year ago. Share repurchases totaled $124 million, with $703 million bought back over the past twelve months.
Looking Ahead: Guidance and Watch Areas
Management updated its full-year 2025 guidance for adjusted operating expenses and SBC (non-GAAP) to $2.15–2.25 billion, reflecting $65 million in additional costs tied to integrating Bitstamp. There were no specific forecasts given for revenue, EPS, or net interest income. Management noted continued strong trends in July 2025, citing about $6 billion in net deposits and high trading activity at the start of the third quarter.
For investors, areas to watch in the coming quarters include the impact of falling interest rates on net interest revenue, any further increases in operating expenses related to ongoing acquisitions, and continued growth in new products and geographies. Management noted that a 25 basis point drop in interest rates would represent a $50 million revenue headwind on a standalone basis. Internally, the company’s ability to balance innovation and scaling costs, while managing regulatory compliance across a larger footprint, will remain critical as it expands globally and enters new asset classes.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
