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Shares of Robinhood Markets Inc. HOOD rose 1.6% in after-market hours on better-than-expected quarterly results. Its first-quarter 2025 earnings per share of 37 cents surpassed the Zacks Consensus Estimate of 31 cents. Moreover, the figure compared favorably with earnings of 18 cents in the prior-year quarter.
Results benefited substantially from higher equity trading amid heightened volatility, higher net interest revenues (NIR) and a jump in Gold subscribers. Also, the company witnessed improvement in Monthly Active Users (MAU). However, a rise in expenses acted as a headwind.
Net income (GAAP) was $336 million, up significantly from $157 million in the year-ago quarter.
HOOD’s Revenues Rise, Expenses Increase
Quarterly total net revenues jumped 50% year over year to $927 million. Moreover, the top line beat the Zacks Consensus Estimate of $922.68 million.
During the quarter, average revenue per user (ARPU) increased 39% year over year to $145.
Transaction-based revenues were $583 million, up 77.2% from the prior-year quarter. This was primarily driven by an improvement in options, equities and cryptocurrencies revenues.
NIR grew 14.2% to $290 million. The rise was mainly attributable to higher interest-earning assets balance and securities lending activity, partially offset by lower short-term interest rates.
Other revenues increased 54.3% to $54 million, primarily due to a rise in Gold subscription revenues. During the reported quarter, its Gold subscribers increased 90% year over year to 3.2 million.
Total operating expenses were $557 million, up 21.1%. The rise was primarily due to a rise in all the components. Adjusted operating expenses increased 15.6% to $460 million.
During the reported quarter, adjusted EBITDA jumped to $470 million from $247 million in the year-ago period.
Robinhood’s Other Business Activities
As of March 31, 2025, total AUC jumped 70% year over year to $221 billion. The rise was driven by continued net deposits and TradePMR acquisition.
Equity Notional Trading Volumes increased 84% in the quarter to $413 billion. Likewise, Options Contracts Traded rose 46% to 500 million, while Crypto Notional Trading Volumes increased 28% to $46 billion.
Further, the company reported MAU of 14.4 million, up 5.1% year over year.
Robinhood’s Share Repurchase Update
In the reported quarter, the company repurchased nearly 7.2 million shares for $322 million.
Further, the company increased its existing authorization by $500 million to $1.5 billion. As of April 30, 2025, approximately $833 million worth of shares remained available for repurchase.