Robinhood Markets, Inc. (HOOD) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call indicates strong financial performance, with record highs in various sectors and a positive outlook. The introduction of new products and global expansion plans suggest growth potential. The Q&A session reinforced positive sentiment, highlighting AI integration and international expansion. Although some regulatory challenges exist, the overall strategic direction appears robust, warranting a positive sentiment rating.
Key Financial Performance
Prediction Markets Volumes Doubled year-over-year in Q4 2025, with over 12 billion contracts traded in 2025. Reasons: First full year of prediction markets and increased customer engagement.
Total Platform Assets Grew nearly 70% year-over-year to $324 billion. Reasons: Increased customer trust and product offerings.
Net Deposits Record $68 billion, a 35% growth rate year-over-year. Reasons: Positive net transfers and inflows from major brokerage competitors.
Gold Subscribers Grew nearly 60% year-over-year to 4.2 million. Reasons: Enhanced value proposition of Robinhood Gold.
Revenues Increased from less than $3 billion to $4.5 billion in 2025, a 52% year-over-year growth. Reasons: Product velocity and customer engagement.
Adjusted EBITDA Record $2.5 billion, up 76% year-over-year. Reasons: Efficiency and product velocity.
Adjusted EBITDA Margins Reached a new high of 56%, with incremental adjusted EBITDA margins above 70% for the third straight year. Reasons: Operational efficiency and revenue growth.
EPS (Earnings Per Share) Record $2.05. Reasons: Managed share count closely and operational efficiency.
Interest-Earning Assets Up 39% year-over-year. Reasons: Growth in cash sweep program, margin, and credit card loan book.
Margin Up over 100% year-over-year. Reasons: Winning larger customers and deepening relationships with existing customers.
Q4 Revenues Grew 27% year-over-year to a record $1.3 billion. Reasons: Customer engagement and trust.
Q4 Net Deposits $16 billion, marking the eighth straight quarter with over $10 billion in net deposits. Reasons: Robust customer activity and trust.
Trading Volumes Reached new highs across equities, options, futures, and event contracts. Reasons: Market share gains and record net buying from customers.
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Operating Highlights
Prediction Markets: Volumes doubled in Q4, with over 12 billion contracts traded in 2025. Customers have already traded over $4 billion in 2026.
Equities Offering: Launched shorting, resulting in over $11 billion of equity notional volume in the first few months.
Robinhood Gold Card: Customer base grew 5x in 2025 to 600,000, with $10 billion in annualized spend. Plans to double customers to over 1 million in 2026.
Robinhood Banking: Rolled out with 25,000 funded customers and $400 million in balances. Over 50% of customers enrolled in direct deposit.
Cortex AI: Introduced Cortex Assistant for financial needs and Cortex for Legend to transform trading. Both are scaling in 2026.
Robinhood Social: Set to roll out, integrating prediction markets and enhancing discovery and engagement.
International Expansion: BitStamp volumes doubled since June acquisition. Launched ISAs in the U.K., with 0.75 million customers outside the U.S.
Tokenization: Introduced 2,000 stock tokens in Europe. Plans for permissionless 24/7 tradable public company stock tokens and private company stock tokens.
AI in Customer Support: Over 75% of cases solved by AI, including complex cases requiring licensed professionals.
AI in Software Engineering: Automated engineering pipeline, saving 9 figures in 2025. Focused on code writing, review, deployment, and testing.
Family Investing: Expanding multigenerational platform with family-focused products and referral programs for advisers.
Private Markets: Launching Robinhood Ventures to invest in private assets for retail investors. Potential to surpass prediction markets in scale.
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Risk or Challenges
Regulatory Developments: Potential risk factors include regulatory developments that could cause differences in expected outcomes. These are being monitored but remain a risk to operations and strategic objectives.
Product Expansion Risks: The company plans to accelerate product velocity in 2026, including new ventures like prediction markets, Robinhood Social, and private markets. However, rapid expansion into new products and markets carries risks of execution failure, market acceptance, and operational challenges.
International Expansion Challenges: The company is expanding into new international markets and tokenization opportunities. These initiatives carry risks related to regulatory compliance, market fit, and operational scalability in diverse jurisdictions.
AI Integration Risks: While AI is being integrated into customer support and software engineering, there are risks related to over-reliance on AI, potential errors in complex cases, and the need for continuous updates to AI models.
Economic and Market Volatility: The company’s growth in trading volumes and financial products is tied to market conditions. Economic downturns or market volatility could adversely impact customer engagement and revenue.
Competition: The company aims to be #1 in active traders and wallet share, but faces significant competitive pressures from other financial platforms, which could impact its ability to achieve strategic objectives.
Operational Efficiency Risks: The company is focused on maintaining lean operations while scaling. However, there is a risk that cost management efforts could impact the quality of services or delay product rollouts.
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Guidance & Outlook
Revenue Growth: The company projects another year of profitable growth in 2026, with a focus on accelerating product velocity and maintaining lean operations. Revenue growth is expected to continue, building on the 52% year-over-year increase in 2025.
Net Deposits: Robinhood aims to achieve over 20% net deposit growth in 2026, with a long-term goal of exceeding $1 trillion in platform assets, supported by rapid product development and the ongoing generational wealth transfer.
Expense Management: The company plans to manage adjusted operating expenses and SBC within a range of $2.6 billion to $2.725 billion in 2026, representing an 18% year-over-year increase, with significant investments in new and scaling businesses.
Product Development: Robinhood plans to accelerate product velocity in 2026, focusing on prediction markets, AI-driven tools like Cortex, Robinhood Social, and private markets offerings. The company also aims to expand its tokenization initiatives and launch new international markets.
Customer Engagement: The company expects continued growth in customer engagement, with January 2026 equity trading volumes up over 50% year-over-year and options volumes up 20%. Early February trading volumes are also showing growth across all categories.
International Expansion: Robinhood plans to enter several new international markets in 2026, with a focus on tokenization and decentralized finance (DeFi) initiatives.
AI Integration: The company aims to integrate AI across all functions, with a focus on customer support and software engineering, to drive efficiency and cost savings. AI-driven tools are expected to contribute significantly to product development and operational efficiency.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:Any additional updates on Robinhood Social?
A:Robinhood Social is being tested internally and has added Prediction Markets. The diversity of content is high due to Robinhood's large customer base and asset variety. A public launch is expected in the coming months.
Q:What could be the reasons for the more than 40% drop in Hood's share price? How is leadership addressing the downslope?
A:Leadership is focused on business inputs, market share gains, and customer trust with $68 billion in net deposits last year. New products like Robinhood Banking, Robinhood Social, and Cortex Assistant are in the pipeline. A $1 billion share repurchase program is also in place to address market volatility.
Q:What is your plan on navigating the rough seas during this crypto downturn and the end of football season?
A:Robinhood is focusing on crypto as a foundational technology and diversifying prediction markets beyond sports. NBA contracts surpassed NFL in trading activity, and non-sports contracts like government shutdowns are gaining traction. The company is also diversifying revenue streams, with crypto accounting for only 18% of overall revenue.
Q:What is the team working on for prediction markets, and what can we expect this year?
A:The team is refining the trading experience, adding tools like combos and player contracts, and improving search and discovery. They are integrating prediction markets contextually across the app and leveraging vertical control through Rothera for better pricing and economics.
Q:What is the mix between sports and non-sports in prediction markets, and how are you incentivizing new users?
A:Efforts are focused on improving the sports experience while diversifying into non-sports contracts. New user activation includes referrals, learn-and-earn programs, and personalized onboarding. The company is ROI-driven and gradually increasing marketing efforts.
Q:Can you expand on international expansion and compare Europe versus Asia?
A:Robinhood is expanding in the U.K. and EU with multicurrency wallets and stock tokens. The EU is a test case for crypto-based Robinhood, focusing on tokenization. Southeast Asia and other markets will see quicker ramp-ups due to prior regulatory and platform groundwork.
Q:How is Robinhood leveraging AI, and what are the plans for AI integration?
A:Robinhood is integrating AI through Cortex Assistant, which will roll out soon. AI is expected to transform financial services, providing self-serve tools and streamlining human advisor workflows. Conversations with regulators are ongoing to safely bring AI-driven advisory to customers.
Q:What level of revenue growth is Robinhood budgeting for, and how flexible is the model?
A:Robinhood expects revenue to grow faster than expenses, focusing on profitable growth. Investments are ROI-driven, and the company maintains flexibility with 85-90% fixed costs. The plan emphasizes scaling products that can become $100 million businesses.
Q:What are the economics and benefits of Rothera for prediction markets?
A:Rothera allows Robinhood to control the full product stack and monetization, improving customer experience and unit economics. The company aims to provide the best pricing and experience while competing for external business on its marketplace.
Q:What are the plans for Robinhood Social in 2026?
A:Robinhood Social will initially launch and scale in the U.S. before expanding internationally. Translation technologies will enable international customers to benefit from U.S. content over time.
Q:How is Robinhood addressing institutional and retail mix in BitStamp and pricing strategies?
A:BitStamp has seen growth in market share and revenues. Retail pricing has shifted to smart order exchange routing, with volume tiers for active traders. The focus is on market share rather than pricing, with perpetual futures offerings expanding outside the U.S.
Q:What is the appetite for launching prediction markets in fundamental equities?
A:Robinhood is interested in company-related prediction markets but faces regulatory hurdles for financial KPIs. Conversations with regulators are ongoing to address ambiguities and enable such offerings.
Q:How do tokenization and AI come together, and what does it mean for Robinhood?
A:Tokenization makes integration with blockchain protocols easier, enabling AI agents to interact with offerings. Robinhood is well-positioned for this future, with tokenized stocks and stablecoin partnerships providing a competitive edge.
Q:How does Robinhood prioritize products for international expansion?
A:Robinhood prioritizes speed to market and ROI, using both organic and inorganic approaches. Prediction markets are currently U.S.-only, but there is potential for on-chain versions internationally.
Q:What is the push into private markets, and what are the hurdles?
A:Robinhood is exploring private market offerings through 40 Act registered funds, focusing on assets like private equity, real estate, and credit. Regulatory and operational hurdles are being addressed to expand these offerings.
Q:What is the strategy for international expansion and capital allocation?
A:Robinhood uses both organic and inorganic approaches, focusing on speed to market and ROI. Acquisitions are made for complementary technologies, avoiding duplicative platforms to maintain efficiency.
Q:How is Robinhood expanding its banking offerings?
A:Robinhood Banking has over $400 million in assets, with a 50% direct deposit attach rate. The 3.5% APY on savings and checking is a key feature. Integration with other products enhances customer experience and asset growth.
Q:What are the updates on tokenization and stablecoin partnerships?
A:Robinhood is focusing on tokenization of private markets outside the U.S. and stablecoin partnerships with Paxos. Efforts are underway to offer differentiated products that resonate with customers, pending regulatory approvals.
Q:Review of Unclear Management Responses
A:Management avoided directly addressing the question about the potential role of Robinhood in Trump accounts, providing only general support for the initiative without specific details.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
Banking Strategies
Banking month
Banking rollout
BitStamp Trade
BitStamp product
CEO Chairman
CFO VP
Card
Co Founder
Finance Treasurer
Founder President
President CEO
QA
SBC
Shiv
Trade PMR
Treasurer Co
UK
VP Finance
arc ecosystem
asset deposit
audience
buying
capability
expense
investment
life
percentage point
platform asset
point business
product market
revenue record
share count
term arc
value year
volume high
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HOOD Transcript
Robinhood Markets, Inc. (HOOD) Q4 2025 Earnings Call Transcript
Positive2-10
The earnings call indicates strong financial performance, with record highs in various sectors and a positive outlook. The introduction of new products and global expansion plans suggest growth potential. The Q&A session reinforced positive sentiment, highlighting AI integration and international expansion. Although some regulatory challenges exist, the overall strategic direction appears robust, warranting a positive sentiment rating.
Robinhood Markets, Inc. (HOOD) Q3 2025 Earnings Call Transcript
Positive11-5
The earnings call summary highlights strong revenue growth, product expansion, and international growth, which are positive indicators. The Q&A section reveals a focus on strategic initiatives like tokenization and Prediction Markets, with positive analyst sentiment. The absence of clear guidance on adopting digital assets is a minor concern, but overall, the strong financial metrics, optimistic guidance, and shareholder return plan suggest a positive outlook for the stock price over the next two weeks.
Robinhood Markets, Inc. (HOOD) Q2 2025 Earnings Call Transcript
Positive7-31
Robinhood's earnings call and Q&A reveal a strong performance and optimistic outlook. Key highlights include a 50% YoY revenue increase, expanded adjusted EBITDA margin, and a significant increase in share repurchase authorization. Product development is robust, with successful new launches and international expansion. The Q&A section confirms positive sentiment, with analysts acknowledging strong growth in various business areas, including the securities lending and credit card segments. The company's strategic focus on tokenization and diversification further supports a positive market reaction. Despite some regulatory uncertainties, the overall sentiment is highly positive.
Robinhood Markets, Inc. (HOOD) Presents at Piper Sandler Global Exchange & Trading Conference Transcript
Neutral6-5
HOOD Slides
HOOD Report
Frequently Asked Questions
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