Robinhood (Minutes): In the future, will retail investors also be able to buy private companies like SpaceX?
Below is the $Robinhood(HOOD.US) Q1 2025 earnings call Minutes. For Quick Interpretation of the earnings report, please refer to《Robinhood: Ups and Downs Hinge on Trump, When Will It "Take Control of Its Own Destiny"?》
I. Key Earnings Highlights
II. Management Commentary:
1) Outlook:
a. TradePMR will incur $85 million in costs, prompting us to update our full-year adjusted operating expenses and SBC guidance to a new range of $2.085–2.185 billion. Note: This outlook excludes expected Bitstamp acquisition costs or credit loss provisions.
b. All nine major businesses now generate over $100 million in annualized revenue each; three new products—futures, index options, and prediction markets (e.g., betting on election outcomes)—each contribute ~$20 million in annualized revenue; TradePMR will add ~$50 million in annualized revenue.
c. Robinhood Strategies, Robinhood Banking, and Bitstamp (pending acquisition) will begin generating revenue later this year. Many of these businesses are expected to reach $100 million in annual revenue.
(Note: Strategies offers professional portfolio management for Gold members with smaller AUM at a 0.25% fee, capped at $250/year; Cortex uses AI for market analysis; Banking provides high-net-worth-style services.)
2) Share Buybacks
The $1 billion buyback program launched in Q3 last year aims for completion in 2–3 years. $650 million has been executed at an average $33/share, including $300 million in Q1 to offset dilution from TradePMR.
The board authorized an additional $500 million, leaving $800+ million for buybacks over the next two years.
3) Progress on Hood’s Three Missions:
Three missions: #1 active trader platform, #1 next-gen wallet share, #1 global financial ecosystem.
1. Active Trader Platform:
a. Launched futures and prediction products in Q1. Futures: April contracts exceeded 4.5 million, surpassing Q1 totals; prediction markets saw $1B+ in contracts traded over six months.
b. Desktop platform Robinhood Legend (launched last year) added crypto, index options, joint accounts, and advanced charts.
c. Robinhood Strategies—40,000+ clients with $100M+ AUM; Cortex and Banking in development.
d. Gold 信用卡: Users grew to 200K.
2. Wallet Share:
a. Retirement assets: $16B, up ~20% YTD.
b. TradePMR: Closed acquisition, adding $40B AUM.
3. Global Financial Ecosystem:
a. Expanding UK brokerage and entering Asian markets.
b. Bitstamp: Acquisition to close mid-year.
c. Gold users: 3.2M (12% penetration); ~1/3 of new users quickly upgrade to Gold.
d. International users: 150K.
III. Analyst Q&A
Q: Updates on Gold member 信用卡 and checking accounts?
Cardholders doubled to 200K+. Robinhood Banking, announced at March’s "Gold Lost City" event, targets high-net-worth digital banking. Launching in Q3.
Q: When can we trade private companies like SpaceX?
It’s absurd that naive investors can’t access private markets—prolonged privatization deprives them of growth gains.代币化 could solve this (per my WaPo op-ed). We need legislation redefining accredited investors (currently excludes 80%+ of the public). Progress is underway.
Q: Timeline for 401(k) plans?
Long-term vision: Build a global financial ecosystem serving retail, institutions, and enterprises worldwide. TradePMR’s RIA services are step one. 401(k) is a decade-scale opportunity.
Q: April retail trends? New asset inflows—new or existing users?
Strong April. Diversified deposits from retirement, Strategies, crypto, etc. Focus shifted from user growth (2022) to active trading (e.g., futures). Nine $100M+ revenue streams reduce reliance on trading.
Q: Gold user growth—55K QoQ revenue increase. Outlook?
Gold is a best-in-class service, inspired by Prime.信用卡 and Banking (Gold-exclusive) will drive growth. No plans to raise prices.
Q: Crypto market rebound—thoughts?
Q1 was our second-best crypto revenue quarter. Volatility is high; we focus on share gains. Bitstamp will diversify beyond crypto trading.
Q: Deep dive on Strategies, futures, Cortex?
Strategies: 40K+ users, $100M+ AUM, positive social feedback. Futures enable shorting (no stock shorting yet). Cortex (Gold-only AI assistant) explains stock moves and builds strategies—no extra fee.
Q: Banks entering crypto—competitive impact?
Hard to speculate. We lead in innovation. Crypto is foundational tech—early innings for financial integration. More competition legitimizes the market; we’re well-positioned.
Q: ROI on March’s 2% transfer promo?
Payback periods are attractive. Average transfer: $90K ($180K for taxable accounts).
Q: Rising crypto take rates?
Pricing tests continue. Layered pricing rewards high-volume traders. April rates aligned with Q1.
Q: Legend desktop updates?
No revenue update ($50M annualized). Roadmap: Add futures, enhance Active Trader features, and live-streaming widgets.
Q: Credit provisions—$20M guidance vs. actual?
Delinquencies/charge-offs remain low. Higher provisions were fraud-related (brokerage, not cards).
Q: Prediction markets—$1B in six months. Details?
Sports contracts drove <50%. March events (Masters, NHL, NBA) boosted volume. Early-stage potential.
Q: Cross-sell from gambling/信用卡 to Gold?
25M funded users actively try new products.信用卡 waitlist: 3M. Gold drives higher deposits and product adoption.
Q: Smart order routing’s impact on crypto take rates?
Early testing rewards loyal/high-AUM users with better pricing—unlike traditional finance. April rates matched Q1.
Q: TradePMR’s $85M cost—room to optimize?
Expect reductions next quarter.
Q: Crypto staking/FIT21 bill—regulatory risks?
No operational concerns. Clarity on crypto securities listings would unlock value—our key policy goal.
Q: Prediction market user engagement/penetration?
Diverse user base (sports vs. economic predictors). Unlike options traders, prediction users trade across products.
Q: NII guidance update?
None. Assumed 25bps rate cut ($50M NII hit). Asset growth offset rate drag.
Q: Overnight trading opportunities?
Growing demand. Macro events drive after-hours volatility. Global expansion makes 24/7 trading table stakes.
Q: Bitstamp post-acquisition plans?
Deal closes mid-year. Focus: institutional biz and global expansion (details reserved).
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Disclosures: Dolphin Research Disclaimers
