Robinhood Markets, Inc. (HOOD) Earnings

Management highlights

### Core Mission & Long-Term Strategic Priorities - Robinhood's core mission is to expand broad access to financial ownership, aligned with the vision that widespread ownership creates a more free, stable, and prosperous society. - Management is focused on three long-term strategic pillars: 1) Become the leader for active traders, offering access to all tradable asset classes; 2) Capture leading wallet share for the next generation of customers, enabling lifelong ownership across the entire family; 3) Build the leading global financial ecosystem, expanding US-based access to ownership to billions of people worldwide. ### Key Operational Milestones Q2 2026 - Core Trading: Rothera (Robinhood's designated contract market joint venture) became a top 3 DCM in the US within one month of launch; the first version of agentic AI trading launched, allowing customers to build custom AI agents to trade equities, options, and (coming soon) crypto. - Wallet Share & Retail Banking: Trump Accounts (government-collaboration child savings accounts) officially launched; Robinhood Gold Card crossed 1 million cardholders; banking deposits exceeded $3 billion; total net deposits reached a record $22 billion, pushing total platform assets to a new all-time high. - Global & On-Chain Expansion: Closed the WonderFi acquisition in Canada; secured a capital markets license in Singapore; launched Robinhood Chain, a blockchain purpose-built for real-world assets (RWAs), which hit 150+ million transactions and $12 billion in DEX volume within weeks of launch; launched stock tokens for non-US customers, available in 120+ countries. ### Capital Allocation Update - Robinhood opportunistically raised $2.2 billion in new capital in June 2026 on attractive terms: 0% coupon, no net dilution until the share price exceeds $300, providing additional flexibility for long-term growth investments. - Year-to-date through Q2, Robinhood has repurchased 7.5 million shares for $664 million, maintaining disciplined share count management. - Management's financial North Star remains maximizing long-term earnings per share and free cash flow per share for shareholders.

Guidance

- Full-year 2026 adjusted operating expenses plus stock-based compensation (OpEx and SBC) guidance was lowered to a range of $2.675 billion to $2.775 billion, representing a downward revision from prior guidance, even after including costs for two new businesses (Rothera and WonderFi) not included in the initial outlook. Management notes the new guidance reflects ongoing operating efficiency improvements that allow the firm to self-fund new growth investments without increasing overall expense levels. - Management reaffirms a long-term target of 20%+ annualized net deposit growth, noting that month-to-month volatility is normal and the firm remains well on track to hit this target year-to-date 2026. - Management has set a long-term 10-year target to 10x the size of the Robinhood business, supported by multiple large addressable markets across core brokerage, retirement, banking, crypto, international expansion, and B2B services. - Q3 2026 early indicators: July average daily trading volumes for equities, options, and prediction markets are similar to the record Q2 2026 levels; July net deposits are tracking to the $4 billion range (not including deposits from Trump Accounts, which launched in July).

Segment performance

Robinhood does not break out formal product segment financials in this call, but the following results are reported for key business lines: 1) Core Trading (equities, options, prediction markets): Record transaction volumes across all classes, with prediction markets growing to 2 million unique users; this segment drove strong transaction-based revenue growth alongside market share gains. 2) Crypto & On-Chain Business: Robinhood Chain mainnet launched, with over $12 billion in DEX volume and more than 150 million transactions in its first weeks; Robinhood Earn (stablecoin lending) has accumulated $200 million in deposits within a few weeks of launch; Stock tokens are available to customers in over 120 countries, supporting the firm's global expansion. 3) Consumer Finance (Robinhood Gold, Gold Card, Banking): Gold subscribers reached a record 4.8 million, with a 17% attach rate to net funded accounts; the Gold Card crossed 1 million cardholders, generating over $17 billion in annualized purchase volume; banking deposits exceeded $3 billion, with 40% of banking customers opting for direct deposit. 4) New Products (Trump Accounts, Agentic Trading): Trump Accounts launched in July, with 7 million accounts opened and nearly $1.5 billion in contributions already; the first version of agentic trading has attracted over 100,000 opened accounts. 5) International: Robinhood closed the WonderFi acquisition in Canada, received a capital markets services license in Singapore, and now serves over 1 million customer accounts outside the US. Consolidated Q2 2026 results: Total revenue grew 32% YoY to a record $1.3 billion; adjusted EBITDA grew 35% YoY to $741 million, representing a 57% adjusted EBITDA margin; EPS grew 48% YoY to $0.62; net deposits hit a record $22 billion (28% annualized growth rate); Robinhood added 1 million net new funded customers in the quarter; total platform assets reached nearly $400 billion. Robinhood now has 13 separate businesses each exceeding $100 million in annual recurring revenue (ARR), adding two new businesses (Robinhood Legend and the Credit Card) in Q2.

Risks & headwinds

- Forward-looking results are subject to material uncertainty from ongoing regulatory developments, particularly related to crypto, tokenization, and new product offerings, with potential rule changes that could impact business plans. - New product and infrastructure launches (including Robinhood Chain, agentic trading, and Trump Accounts) carry execution risk, and there is no guarantee that early traction will translate to sustained long-term growth or profitability. - Net deposit growth and trading volumes are sensitive to macroeconomic and market conditions, which can fluctuate quarter to quarter.

Analyst Q&A

• Q: What is the goal of Robinhood Social, and when will it launch publicly? /

  A: Robinhood Social aims to create an in-platform community for idea generation, letting customers learn investing ideas from each other instead of having to source ideas outside the Robinhood platform. Early testing has shown positive signs, and the product team is iterating on feed ranking and post features ahead of full launch. Robinhood expects to roll Robinhood Social out to all users before the end of Q3 2026. (210 characters)

• Q: What is the impact of the Clarity Act crypto regulation bill on Robinhood, if passed? /

  A: The Clarity Act would provide much-needed long-term regulatory stability for the crypto industry in the US, which is necessary for widespread adoption of tokenized real-world assets that Robinhood has heavily invested in. While Robinhood continues innovating overseas and with existing approved products regardless of legislative progress, clear regulation would allow the US to capture the full benefits of the growing tokenization industry, which is very positive for Robinhood's long-term position. (318 characters)

• Q: What is the current early traction for Trump Accounts, and what is the long-term outlook? /

  A: As of the Q2 earnings call, 7 million children have had Trump Accounts opened, with nearly $1.5 billion in total contributions already, before large-scale philanthropic employer contributions have launched. Management expects the total number of accounts to grow to tens of millions, with contributions growing rapidly from current levels. The product will soon add employer funding functionality and an improved philanthropic giving experience, creating a low-cost default giving vehicle that fills an unmet market need. (335 characters)

• Q: What is the monetization model for Robinhood Chain, and how should investors think about DeFi revenue? /

  A: Robinhood generates revenue by charging a few basis points per transaction on Robinhood Chain, with average revenue per transaction falling in that range depending on transaction size. Robinhood shares approximately 50% of this revenue with Arbitrum, the layer-1 that Robinhood Chain is built on top of. Management will provide more detailed breakdowns once the chain matures through a couple of quarters of operation. (286 characters)

• Q: What is the outlook for launching perpetual futures (perps) in the US brokerage? /

  A: Robinhood has had constructive discussions with the CFTC and is making progress toward US perps approval. The firm already offers perps to international customers via both centralized and DeFi offerings, so limited additional development work is needed for the US rollout. Management does not share public timelines at this stage, but there is no hesitation about launching perps; it remains a planned product offering for US customers. (271 characters)