Shares of Robinhood Markets Inc. fell below its initial public offering price in after-hours trading, as the retail broker reported lower-than-expected revenue for the third quarter as trading levels eased for things like the cryptocurrency Dogecoin.
Robinhood shares were down 9.02% at $36.00 after the release of the results, less than the $38 they were priced at in the Menlo Park, California-based company’s July IPO.
Robinhood, the owner of the trading app at the center of January’s trading frenzy for so-called meme stocks, said in August that it expects retail investors to take respite in the third quarter.
In its second result as a public company, the company posted total revenue of $365 million for the quarter ended Sept. 30, up 35% from a year ago.
Analysts’ consensus estimate was for revenue of $431.38 million, according to IBES data.
Robinhood CEO Vlad Tenev said on a call with analysts, “Looking at the second quarter, we saw huge interest in crypto, especially Doug, leading to a large number of new customers joining the platform and record revenue. “
“In Q3, crypto activity hit record highs, leading to fewer newly funded accounts and lower revenues.”
Last quarter, Robinhood said that trading in Dogecoin – a meme-inspired cryptocurrency – made up 62% of its cryptocurrency transaction volume.
Revenue from equity trading fell 27% to $50 million.
Robinhood said that transaction-based revenue from cryptocurrencies increased 860% from a year ago to $51 million, but it was well off its record high in the second quarter.
The slowdown in retail trade, one of the standout trends in the pandemic era, comes as vaccine rollouts in the United States have helped the country ease restrictions and restart sports and other activities.
Disclaimer: This post has been self-published from the agency feed without modification and has not been reviewed by an editor
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