Revenue at Robinhood Markets Inc. more than doubled in the second quarter thanks to a torrent of customers trading cryptocurrency, but the company posted a big loss due to an emergency funding deal earlier this year.
The trading app recorded a loss of $502 million, or $2.16 per share, on revenue of $565 million in its first earnings report since its July initial public offering. In the second quarter of 2020, Robinhood generated a profit of $58 million on revenue of $244 million.
Nearly 14.2 million Robinhood users, or roughly 63% of the company’s customer base with funded accounts, traded digital assets in the second quarter. Robinhood earned $233 million in fees from routing customers’ cryptocurrency trades to high-speed trading firms, with dogecoin accounting for nearly two-thirds of the volume. That is up from just $5 million a year earlier.
That helped offset slowdowns in other parts of Robinhood’s business due in part to waning interest in meme stocks. For instance, fees Robinhood earned executing customers’ stock trades fell 27% to $52 million.
Despite decreased stock-trading activity, interest that Robinhood received on margin loans nearly tripled to $31 million. Around 700,000 users held about $5.4 billion in margin-loan balances at the end of June.