Robinhood Pivots to Event Betting as Crypto Revenue Plummets 47%

Robinhood (HOOD) is aggressively diversifying its revenue streams to reduce its dependence on volatile cryptocurrency markets. The company's first-quarter 2026 results revealed a stark contrast between its legacy crypto business and its emerging prediction market offerings. While crypto-related revenue crashed 47% year-over-year to $134 million, down from $252 million in the same period of 2025, the firm saw a meteoric rise in other transaction revenue. This segment surged 320% to $147 million, primarily driven by the adoption of event contracts. Robinhood reported a record 8.8 billion event contracts traded during the quarter, as users increasingly bet on real-world outcomes. Financial performance remained generally positive, with total revenue climbing 15% to $1.07 billion, compared with $927 million a year earlier. Net income saw a modest 3% increase to $346 million. However, the market focused on the bottom line; adjusted earnings per share (EPS) came in at $0.38, narrowly missing the $0.39 consensus estimate from analysts. The market reacted negatively to the EPS miss, with HOOD shares falling 6% in post-market trading. The strategic shift toward event contracts and subscription services like Robinhood Gold highlights a broader effort to smooth out revenue volatility, a trend also observed in competitors such as Coinbase.