Robinhood Markets Inc said on Wednesday lower trading activity was likely to impact its third quarter after reporting a 131% jump in the second-quarter revenue, thanks to a surge in cryptocurrency trading.
Shares fell 5.2% after the online brokerage said the current quarter will also be affected by fewer funded accounts. It will also record a one-time charge of $1 billion in stock based compensation related to its initial public offering last month.
The company's easy-to-use interface made it the go-to app for mom and pop investors stuck at home last year, but the reopening of the economy made possible by vaccinations against the coronavirus caused trading activity to moderate.
The company, which was at the center of the historic "meme stock" trading mania earlier this year, posted a total net revenue of $565 million for the quarter ended June 30 compared to $244 million a year earlier.
Robinhood allows users to make unlimited commission-free trades in stocks, exchange-traded funds, options and cryptocurrencies.
Transaction-based revenue for the quarter rose 141% to $451 million, of which cryptocurrency trading comprised $233 million. It was only $5 million a year ago.
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