Well known Internet securities companies, their performance suddenly soared!
According to the latest financial report, in the second quarter, the net profit of Robin Hood, an American Internet securities firm, reached $188 million, up 652% year on year; Earnings per share are $0.21, with a market expectation of $0.15. The company's revenue and earnings per share both hit quarterly highs.
Why is Robinhood's performance so strong?
Net profit surged by 652%
On August 7 local time, Robin Hood, an American Internet securities firm, announced its financial report for the second quarter of 2024. Data shows that in the second quarter, Robinhood's revenue was $682 million, a year-on-year increase of 40.33%, and analysts expected it to be $642 million.
Specifically, transaction based revenue was $327 million, a year-on-year increase of 69%, mainly driven by options revenue ($182 million, a year-on-year increase of 43%), cryptocurrency revenue ($81 million, a year-on-year increase of 161%), and stock revenue ($40 million, a year-on-year increase of 60%).
Net interest income reached $285 million, a year-on-year increase of 22%, thanks to the growth of interest bearing assets, increased securities lending activities, and rising short-term interest rates; Other income increased by 19% year-on-year, reaching $70 million, mainly due to the increase in gold income.
In the second quarter, Robinhood's net profit was $188 million, a year-on-year increase of 652%; Earnings per share were $0.21, exceeding market expectations of $0.15, and earnings per share for the same period last year were $0.03. Robinhood CFO Jason Warnick stated that both Q2 revenue and earnings per share reached quarterly highs, and the company will continue to focus on achieving profitable growth for the new year.
The company's monthly active users decreased from 13.7 million in the first quarter to 11.8 million in the second quarter, which was higher than 10.8 million in the second quarter of last year but lower than the market expectation of 13.1 million; In the second quarter, the company earned an average revenue of $113 per user, a year-on-year increase of 35%, compared to $104 in the previous quarter. In the second quarter, the number of subscribers to Robinhood Gold, the company's premium subscription service, increased by 61% to reach 2 million.
In the second quarter, Robinhood's assets under custody increased by 57% year-on-year to $139.7 billion, thanks to sustained net deposits and higher stock and cryptocurrency valuations. Net deposits in the second quarter reached a historic high of $13.2 billion, an increase from $11.2 billion at the end of the first quarter, while analysts expected $11.23 billion.
In the capital market, Robinhood's stock price has risen by over 34% since the beginning of this year, while the S&P 500 index has risen by 9%. After the US stock market closed on Wednesday, Robinhood's stock price rose by over 2%.
Are you planning to launch cryptocurrency futures?
Robinhood's cryptocurrency business is growing rapidly and seeking further expansion. In June of this year, Robinhood reached an agreement to acquire cryptocurrency exchange Bitstamp for $200 million, marking Robinhood's intention to expand its influence in the cryptocurrency field globally and attract more institutional customers through innovative products. This transaction is planned to be completed in the first half of 2025.
Bitstamp was founded in the UK in 2011 and quickly rose to become one of the largest cryptocurrency trading platforms in Europe. It offers spot trading services for over 85 cryptocurrencies and offers other cryptocurrency products including institutional lending and staking. Its customers are spread across the EU, UK, US, and Asia. Robinhood has been providing cryptocurrency trading services to EU clients since December last year, laying the foundation for its expansion in the international market.
Recently, it has been reported that Robinhood is considering launching cryptocurrency futures in the United States and Europe in the coming months. Once the $200 million acquisition of Bitstamp is completed next year, Robinhood hopes to use the cryptocurrency exchange's license to offer perpetual futures on Bitcoin and other tokens in Europe. The company also hopes to launch Bitcoin and Ethereum futures based on the Chicago Mercantile Exchange in the United States. However, Robinhood has not publicly confirmed the above rumors.
It is worth noting that recently, cryptocurrency has become a hot topic during the US presidential election. On July 27th, Trump announced at the 2024 Bitcoin Conference that he would establish a Presidential Advisory Committee on Cryptocurrency and use most of the cryptocurrency seized by the US government in law enforcement actions to establish a national Bitcoin "reserve". Trump declared that if he returns to the White House, he will be committed to making the United States the global "cryptocurrency capital" and "Bitcoin superpower".
However, since Biden withdrew and Harris secured the Democratic presidential nomination, Trump's chances of winning seem to have decreased. More and more people are questioning whether Trump has a chance to implement his "pro cryptocurrency" agenda, which has weakened the rise of Bitcoin.
On August 7th, Vlad Tenev, CEO of Robinhood, answered questions about the regulatory landscape during a conference call with analysts and said, "In the United States, there is a lot of work to be done, and we believe that regardless of which government ultimately takes power in November or the same government, we can succeed
The above statement echoes the remarks made by Brian Armstrong, CEO of Coinbase, last week. Ryan Armstrong recently stated, "We are increasingly optimistic that the next administration, whether Democratic or Republican, will be constructive on cryptocurrency issues
Recently, the cryptocurrency exchange Coinbase, known as the "shovel seller," disclosed performance that exceeded market expectations. In the second quarter, Coinbase's revenue was $1.45 billion, a significant increase of 105% year-on-year, while analysts expected it to be $1.39 billion; In the second quarter, Coinbase's net profit was $36 million, compared to a loss of $97 million in the same period last year. The company's earnings per share were $0.14, compared to a loss of $0.42 per share in the same period last year.