After-hours trading of Robinhood surged more than 10% as its Q4 revenue and profit exceeded expectations.
Robinhood announced its financial performance for the fourth quarter and full year of 2023. Both Q4 revenue and profit exceeded market expectations, leading to a post-market increase of over 10% in the stock price. Q4 revenue reached $471 million, a YoY growth of 23.96%. Net profit was $30 million, with diluted earnings per share of $0.03. Net interest income grew by 41% YoY, driven by the growth of interest-earning assets and rising short-term interest rates. Trading-based revenue increased by 8% YoY, fueled by cryptocurrency and stock trading activities. Monthly active users decreased by 4% YoY, while gold subscription users increased by 25% YoY. As of the end of Q3 2023, Robinhood had a net deposit of $4.6 billion, with custodial assets growing by 65% YoY.
Zhitong App learned that on the morning of February 14th, Robinhood announced its financial performance for the fourth quarter and full year of 2023. The earnings report showed that Robinhood's revenue for Q4 reached $471 million, a YoY growth of 23.96%, surpassing market expectations of $457 million. Net profit was $30 million, compared to a net loss of $166 million in the same period last year. Diluted earnings per share were $0.03, compared to a loss per share of $0.19 in the same period last year, exceeding market expectations.
After the announcement of better-than-expected performance, Robinhood's stock price rose more than 10% after hours. As of the time of writing, the company's stock price rose 10.56% after hours, reaching $13.09.
Driven by the growth of interest-earning assets and the rise in short-term interest rates, net interest income increased by 41% YoY to $236 million. Revenue from trading increased by 8% YoY to $200 million, mainly driven by cryptocurrency and stock trading.
Q4 cryptocurrency trading revenue was $43 million, exceeding the expected $37 million.
Monthly active users (MAU) decreased by 4% YoY to 10.9 million; gold subscription users increased by 25% YoY to 1.42 million; average revenue per user (ARPU) increased by 23% YoY to $81.
As of the end of Q3 2023, Robinhood's net deposits were $4.6 billion. Assets under custody (AUC) increased by 65% YoY to $102.6 billion.
In January of this year, US regulators approved some Bitcoin spot ETFs, and Robinhood quickly offered these funds to its customers. Although the frenzy of ETF approvals has subsided, the value of Bitcoin, the oldest cryptocurrency, has just reached its highest point in two years.
Chief Financial Officer Jason Warnick told analysts in a conference call on Tuesday that the trend of declining interest rates tends to support economic growth, which presents an opportunity for Robinhood in the coming year.
Warnick said, "We believe that by 2024, interest rates will change from headwinds that hinder our business growth to tailwinds."
Robinhood expects total operating expenses for this year to be between $1.85 billion and $1.95 billion. Analysts predict that the company's total operating expenses will be $1.95 billion.
Robinhood CEO Vlad Tenev said in a statement, "2023 was a strong year as our product velocity continued to accelerate, our market share in trading increased, and we began expanding globally." "We will have an even better start in 2024 as the funded customers and net deposits we brought in the first half of the first quarter have already exceeded our total revenue in Q4 2023."