Robinhood Achieved Its Best Performance Ever, but Its Stock Price Nearly Halved

Original Author: Ada, TechFlow

Robinhood is experiencing a peculiar split.

After the U.S. stock market closed on February 10th, this retail trading platform delivered what appeared to be a flawless report card: full-year revenue of $4.5 billion, a 52% year-over-year increase, reaching a record high. Diluted earnings per share were $2.05. Net deposits for 2025 hit a record $68 billion, with $16 billion in the fourth quarter alone. Robinhood Gold subscription users reached a record 4.2 million.

CEO Vlad Tenev was in high spirits during the earnings call: "We are building a financial super app."

But the stock price fell 7% after hours. Combined with this year's decline, Robinhood's stock price has been halved from its peak in October last year. A company that just posted its best-ever performance saw its market value evaporate by half in four months.

What's the problem?

A closer look at the earnings reveals cryptocurrency trading revenue: $221 million, a sharp 38% year-over-year plunge.

This figure was $357 million in the same period last year and $268 million in the previous quarter. By Q4, crypto trading volume on the Robinhood App had halved to just $34 billion.

Retail investors have stopped trading. Bitcoin fell from $126,000 to $65,000, FOMO disappeared, replaced by fear. Opening the app reveals a sea of green turned red, and closing the app is the most rational choice.

This is Robinhood's dilemma: its core business is improving, but the market is only focused on the part that is deteriorating.

How much did crypto contribute to the $4.5 billion revenue?

Breaking down Robinhood's revenue structure reveals an ongoing identity shift.

Q4 transaction-based revenue was $776 million, up 15% year-over-year. Options trading contributed $314 million, up 41%; stock trading contributed $94 million, up 54%; other transaction revenue was $147 million, tripling. The only drag was crypto, plummeting from $358 million to $221 million.

Net interest revenue was $411 million, up 39%, primarily driven by growth in interest-earning assets and securities lending activities. Gold membership subscription revenue was $50 million, up 56%.

For the full year, crypto trading revenue's share of total revenue has dropped from around 35% in Q4 2024 to 17% in Q4 2025.

Robinhood is well aware of this trend.

Over the past year, it has aggressively expanded its product offerings: the prediction market handled 12 billion contracts in its first year, with trading volume more than doubling in Q4 alone; futures trading now covers stock indices, energy, metals, and crypto; Gold Card holders are approaching 1 million.

As early as the Q3 2025 earnings call, management stated: "We now have 11 business lines with annualized revenue exceeding $100 million."

The message: don't just focus on crypto. But Wall Street is fixated on crypto.

A brokerage living in Bitcoin's shadow

This brings to mind Strategy's earnings report released five days ago.

Strategy reported a quarterly net loss of $12.4 billion, almost entirely from unrealized impairment due to Bitcoin's Q4 price drop. Saylor doesn't care; he says Bitcoin's decline is a gift, and every pullback is a buying opportunity.

Robinhood's situation is the opposite. It doesn't hold Bitcoin, doesn't bear price risk, and doesn't rely on issuing debt to buy coins to survive. It's just a trading platform, earning commissions.

But when Bitcoin falls, retail investors stop trading, and commissions disappear.

Strategy lives off Bitcoin's price. Robinhood lives off Bitcoin's volatility. The two companies appear completely different, but their underlying dependence is the same thing: retail sentiment towards cryptocurrency.

Strategy bets on price direction, Robinhood bets on casino foot traffic. In other words, when Bitcoin falls, the casino empties. Both models lose.

Data confirms this judgment. Strategy's MSTR fell 76%, acting as a 1.6x leverage on Bitcoin. Robinhood's stock price fell about 50% from its October high, while Bitcoin fell 48% over the same period. The two curves almost overlap.

One is a leveraged long on Bitcoin, the other is an at-the-money call option on Bitcoin. The underlying asset is the same: the temperature of the crypto market.

The trap of "record-breaking"

The word "record-breaking" appears multiple times in Robinhood's report. Record annual revenue, record adjusted EBITDA, record net deposits, record Gold members, record EPS.

These numbers are real.

Strategy's report also says "record-breaking." Record Bitcoin holdings. Record cash reserves. Record BTC Yield. But its stock price fell 76%.

"Record-breaking" is a medal in a bull market and an epitaph in a bear market. It only tells you your state at the peak, not what happens next.

Robinhood's Q4 reveals a key metric: Monthly Active Users (MAU) dropped from 14.9 million a year ago to 13.0 million, a loss of 1.9 million.

Users are leaving.

Assets under custody grew 68% year-over-year, but that's due to market cap inflation from rising stock and crypto prices. The annualized growth rate of net deposits has slowed from over 30% at the start of the year to 19% in Q4. This means the inflow of money is slowing. People are decreasing.

This is structurally the same problem Strategy faces. In a bull market, all metrics reinforce each other: prices rise, trading is active, revenue rises, users grow, stock price rises. In a bear market, every link reverses.

The flywheel can spin backwards. Robinhood has its own flywheel too.

De-crypto-fication: A high-stakes gamble

Robinhood clearly knows this. Over the past 12 months, Robinhood's strategy can be summarized in one sentence: reduce dependence on cryptocurrency while doubling down on cryptocurrency infrastructure.

It sounds contradictory, but the logic is clear.

On the revenue side, aggressively pursue diversification. Prediction markets, futures, short selling, Gold Card, banking services, retirement accounts, international expansion, etc.

On the infrastructure side, aggressively deepen its presence. Last year, it acquired Bitstamp, the world's oldest crypto exchange, whose trading volume has since doubled. Launched 2,000 tokenized stocks in Europe. Signed acquisition agreements for brokerages and crypto platforms in Indonesia.

Robinhood learned from Coinbase's 2022 lesson.

Coinbase nearly died in the last bear market because its revenue structure was too singular. Armstrong spent two years rebuilding. Tenev is trying to achieve diversification before the bear market fully arrives.

But time is not on his side. Robinhood's adjusted operating expenses and equity-based compensation budget for 2026 is $2.6 to $2.725 billion, an increase of about 18% year-over-year. This money will be spent on international expansion, new product development, and acquisition integration. If the crypto winter persists and growth in the traditional brokerage business isn't fast enough, cost expansion coupled with slowing revenue will squeeze margins.

With approximately $4.3 billion in cash and cash equivalents on the balance sheet, it can burn for a long time. But like Strategy, "surviving" and "growing" are two different things.

The thermometer in the crypto winter

Looking at Strategy and Robinhood's earnings reports together, you see two ways of falling in a Bitcoin bear market.

Strategy is a chronic illness. Bitcoin doesn't rise, the flywheel stops, but its $2.25 billion in cash can last two and a half years. It has time, but time erodes conviction.

Robinhood is an acute reaction. Crypto revenue plunges 38% in a quarter, MAU loses 1.9 million, but other businesses are still growing. It won't die, but it will hurt.

The commonality between the two companies is: they cannot control the most critical variable in their own destiny.

Strategy cannot control Bitcoin's price. Robinhood cannot control retail sentiment. And retail sentiment, ultimately, is determined by Bitcoin's price.

Everyone in this industry pretends they have Alpha, but in reality, everyone only has Beta. Beta is Bitcoin. When Bitcoin rises, everyone is a genius. When Bitcoin falls, everyone is swimming naked.

Robinhood did set records in 2025, but no number of records seems to mask the pain caused by the decline in its crypto business.

Tenev now faces a problem with no standard answer.

The current Robinhood is like a casino owner who has just started to quit gambling. He knows the problem, he is taking action, but the dividends reaped in the bull market have all turned into debts in the bear market.

For Robinhood, the real test is not the records in a bull market, but the floor in a bear market.

Where is the floor? No one knows yet.