Robinhood to Report Big Quarterly Earnings Report, Joins Crypto Fight Against SEC

Trading app Robinhood Markets is set to report its highest quarterly revenue in nearly three years helped by a rebound in stocks and crypto trading in the first quarter. Robinhood’s shares are up 58% in the first three months of the year, with analysts such as brokerage Bernstein earlier gave an outperform rating and a price target of $30 on Robinhood (HOOD).

Robinhood Set for Better Quarterly Earnings

Robinhood Markets to release its first quarter earnings in a conference call on May 8. The company expects a further rise in revenue due to steady rebound in equity markets and crypto trading.

Crypto market recovery caused Bitcoin to hit an all-time high and bets on global interest rate cuts sent U.S. stocks rallying in the first quarter. This has helped retail investor-focused brokerage earn more transaction-based revenue, reported Reuters.

“In the core business, we saw a significant rebound in volumes this quarter across equities, options and crypto with total volumes up nearly 20% in Q1 through February reported metrics,” JPMorgan analysts said.

The daily active users for Robinhood surged 65% in March from a year earlier, according to data from research firm Apptopia. Meanwhile, total new mobile app downloads also jumped 94% during the same period.

As per LSEG data, net interest revenue is anticipated a 24% jump to $258.24 billion. Analysts forecast a 24% rise in revenue to $548.61 million. Online brokerages such as Robinhood saw huge growth in trading volumes and margin loan balances.

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Robinhood Joins Fight Against SEC

Robinhood Crypto LLC received a Wells notice from the U.S. Securities and Exchange Commission (SEC) with cryptocurrency listings, crypto custody, and platform operations issues in dispute.

Vlad Tenev, CEO of Robinhood, said “Over the last three years, we’ve reached a state of regulatory onslaught that is harmful to American companies and consumers.” The firm has now joined others as “The SEC’s continued attack on crypto, coupled with recent rule proposals like the one related to predictive data analytics, mark yet another improper attempt by the administrative state to stifle innovation.”

Robinhood’s coin offerings in the U.S primarily include 15 tokens: AAVE, BCH, DOGE, LTC, XTZ, AVAX, LINK, ETH, SHIB, UNI, BTC, COMP, ETC, XLM, and USDC.

SEC Chair Gary Gensler said Robinhood’s Wells Notice indicates most crypto are securities. He argued that the investors are unaware of trading these crypto and regulations.

HOOD price closed 1.18% higher at $17.99 on Tuesday, recovering from the drop seen after the SEC issued a Wells Notice.

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