Robinhood Posts Record Prediction Market Volume Despite Q1 Earnings Miss

Record prediction market activity was among the highlights of Robinhood’s first-quarter earnings. The company saw 8.8 billion event contracts traded, even as it missed analyst expectations and its stock declined following the release.

On the earnings call, CEO Vlad Tenev said the company saw “record levels across prediction markets,” while CFO Shiv Verma described the quarter as a “record quarter for both prediction markets and futures.”

Record Event Contract Volume, Activity Holds Firm

Robinhood users traded 8.8 billion event contracts in Q1, beating the previous record of 8.5 billion recorded in Q4 2025.

Activity remained firm throughout the quarter. In January, users traded 3.4 billion contracts. In February, the volume was 2.4 billion, while in March, it was 3.0 billion.

The consistency is notable as the data suggests that there was no single event-driven spike. January was the highest, despite significant Super Bowl trading and March Madness.

The results suggest that demand for event-based trading has persisted following the late-2025 surge.

That dynamic points to a shift in user behavior, with prediction markets increasingly functioning as recurring trading products rather than short-term, event-driven features.

Rapid Increase In Event Contracts Since Launch

In early 2025, Robinhood said customers had traded more than 1 billion event contracts over a six-month period following the rollout of its prediction markets hub.

By Q3 2025, volumes had climbed to 2.3 billion contracts, before surging to 8.5 billion in Q4, marking the product’s breakout period.

For the full year, Robinhood reported over 12 billion event contracts traded in 2025, with Tenev declaring prediction markets as “the fastest-growing business we’ve ever had.”

Prediction Markets Continue to Scale Into Revenue Mix

Robinhood reported $147 million in “other transaction revenue”, up 320% year-over-year. The category includes event contracts, as well as newer trading products such as futures and instant withdrawals.

Despite higher trading volumes in Q1, the data suggests lower revenue per contract. Supplemental Q1 disclosures indicate that event contracts represented an annualized revenue run rate of approximately $415 million in Q1, compared with about $435 million in Q4 2025.

The relatively flat run rate suggests that monetization is normalizing as prediction markets transition from event-driven spikes to more sustained trading activity.

Product Mix Broadens Beyond Sports

Robinhood’s event contract offering is also evolving. The company has introduced several new contract types beyond traditional futures sports events:

• Preset contract combinations
• Custom combos
• Player-specific contracts

Tenev said the platform is beginning to see “diversification outside of sports,” pointing toward broader event categories such as political and macro-driven contracts.

This shift is important, as it expands the addressable user base and aligns the segment more closely with broader financial trading behavior.

Rothera Launch to Bring Infrastructure In-House

Robinhood is preparing to take a more direct role in the infrastructure of prediction markets through Rothera, its joint venture exchange with Susquehanna.

Expected to launch in Q2 2026, the platform will provide “end-to-end control” over the customer experience, including product selection and pricing, according to Tenev.

Tenev believes the move marks a shift away from reliance on third-party exchanges (Robinhood offers prediction markets via partnership with Kalshi), as the company looks to bring more of the prediction markets stack in-house.

Tenev also suggested the broader prediction market sector may not support a large number of competing platforms. He said, “We should expect consolidation” as the space matures.

Robinhood Q1 2026: Earnings Miss as Crypto Slumps, Trading Mix Shifts

Robinhood reported $1.07 billion in Q1 2026 revenue (+15% YoY) and $0.38 EPS, falling short of analyst expectations. Shares fell about 6% in after-hours trading following the earnings release on Tuesday and opened more than 10% lower on Wednesday.

Financial Snapshot

• Revenue: $1.07 billion (+15% YoY)
• Net income: $346 million (+3% YoY)
• EPS: $0.38 (+3% YoY, below estimates)
• Transaction-based revenue: $623 million (+7% YoY)
• Options: $260 million (+8% YoY)
• Equities: $82 million (+46% YoY)
• Cryptocurrencies: $134 million (-47% YoY)
• Net interest revenue: $359 million (+24% YoY)
• Other revenue: $85 million (+57% YoY), driven by Robinhood Gold
• Net deposits: $17.7 billion (22% annualized growth)

Key Takeaways

Earnings miss despite solid growth

Robinhood delivered double-digit revenue growth but fell short of consensus estimates, reflecting a cooldown from Q4 highs.

Crypto remains a big drag

Cryptocurrency revenue declined 47% YoY to $134 million, significantly reducing its contribution to overall transaction-based revenue. The results also highlight the platform’s reduced reliance on crypto.

Trading mix continues to shift

Growth in equities and options, alongside record subscription adoption, helped offset crypto weakness, pointing to a broader rebalancing of Robinhood’s revenue mix.

Prediction markets emerge as an engagement driver

While not broken out as a standalone revenue line, Robinhood highlighted strong growth in event contracts, with “other transaction revenue” rising 320% YoY, driven in part by prediction market activity.

The record trading volumes in event contracts during the quarter signal that prediction markets are emerging as a meaningful component of user engagement.

Costs rise as the company invests

Robinhood raised its 2026 outlook for adjusted operating expenses and share-based compensation to $2.7B–$2.825B, reflecting continued investment in new products, infrastructure, and growth initiatives.

Momentum improving into Q2

Management pointed to stronger trading activity in April, particularly in equities and options, suggesting improved momentum heading into the second quarter.