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Current year EPS has fallen from $2.32 to $1.85 in 90 days with nine analyst cuts.
Robinhood Markets (HOOD - Free Report) is a commission-free financial services platform that built its reputation on democratizing trading. But when crypto goes cold, the earnings model feels it fast.
HOOD earns a Zacks Rank #5 (Strong Sell) and is today's Bear of the Day.
About Robinhood
Headquartered in Menlo Park, CA, Robinhood is a financial services company that enables customers to trade equities, options, futures, event contracts, and cryptocurrencies on a commission-free basis. The platform also offers ETFs, cash management, margin lending, credit cards, and Robinhood Gold, its premium subscription tier.
The company serves customers in the United States, the United Kingdom, and select European Union markets. As of March 31, 2026, Robinhood had 27.4 million funded customers, $307 billion in total platform assets, and 4.3 million Gold subscribers.
HOOD is valued at $80 billion and has a Forward PE of 47. The stock has Zacks Style Scores of “F” in Value, but “A” in Momentum.
Q1 Earnings Miss
Robinhood's Q1 results missed on both the top and bottom lines. EPS of $0.38 came in below the $0.40 estimate. Revenue of $1.07 billion missed the $1.14 billion consensus by a meaningful margin. The culprit was crypto. Crypto notional trading volume of $66 billion fell 48% year over year as Bitcoin retreated and casual traders stepped away from the asset class. That single line item swung the entire revenue picture.
The underlying business showed genuine strength in other areas. Gold subscribers reached 4.3 million, up 36% year over year. Retirement assets under custody hit $27.4 billion, up 90%. Net deposits grew at a 20% annualized rate. Adjusted EBITDA of $534 million grew from $470 million a year ago. But none of that offset the crypto crater, and the estimates reflect it.
The Estimate Collapse
The revision table is the bear case in numbers. Current year EPS sat at $2.32 ninety days ago. It is now $1.85, a 20% collapse in the consensus in a single quarter. Next year fell from $2.81 to $2.49 over the same window.
Nine analysts revised the current year lower in the last 60 days. Zero revised it lower in the last 7 days, which suggests the cuts may be stabilizing, but the damage is already done and the stock is priced for a recovery that depends heavily on crypto sentiment.
The Bitcoin Problem
Bitcoin has fallen from roughly $85,000 to $60,000 over the past month. That move matters enormously for Robinhood because crypto revenue is high margin and highly volatile.
When casual crypto traders step away, as management confirmed they did in Q1 and into April and May, the revenue impact is immediate and the expense base does not shrink with it.
Management is investing an additional $100 million in 2026 to build the Trump Accounts user interface, raising the full-year adjusted operating expense outlook to $2.7 to $2.825 billion. Spending is going up at exactly the moment crypto revenue is going down.
Technicals Look Bleak
After a huge run late last year, the stock has found a sideways trend along the $80 level. Recently the bulls tried to push the stock higher, but failed and the stock is back to the $80 level.
The long side is likely leaning on the $75 level, but if Bitcoin were to fall further and test the 2026 low of $63.50.
In Summary
The diversification is real but it is not enough to offset a 48% drop in crypto volume with Bitcoin heading lower. Current year estimates have lost 20 cents on the dollar in 90 days, expenses are going up, and the stock is priced for a crypto recovery that has not arrived. That is the Zacks Rank #5 in one sentence.
For those interested in a broker, check out Interactive Brokers (IBKR - Free Report) . The stock is a Zacks Rank #2 (Buy) that is coming off 2026 highs.
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Bear of the Day: Robinhood Markets (HOOD)
Key Takeaways
Robinhood Markets (HOOD - Free Report) is a commission-free financial services platform that built its reputation on democratizing trading. But when crypto goes cold, the earnings model feels it fast.
HOOD earns a Zacks Rank #5 (Strong Sell) and is today's Bear of the Day.
About Robinhood
Headquartered in Menlo Park, CA, Robinhood is a financial services company that enables customers to trade equities, options, futures, event contracts, and cryptocurrencies on a commission-free basis. The platform also offers ETFs, cash management, margin lending, credit cards, and Robinhood Gold, its premium subscription tier.
The company serves customers in the United States, the United Kingdom, and select European Union markets. As of March 31, 2026, Robinhood had 27.4 million funded customers, $307 billion in total platform assets, and 4.3 million Gold subscribers.
HOOD is valued at $80 billion and has a Forward PE of 47. The stock has Zacks Style Scores of “F” in Value, but “A” in Momentum.
Q1 Earnings Miss
Robinhood's Q1 results missed on both the top and bottom lines. EPS of $0.38 came in below the $0.40 estimate. Revenue of $1.07 billion missed the $1.14 billion consensus by a meaningful margin. The culprit was crypto. Crypto notional trading volume of $66 billion fell 48% year over year as Bitcoin retreated and casual traders stepped away from the asset class. That single line item swung the entire revenue picture.
The underlying business showed genuine strength in other areas. Gold subscribers reached 4.3 million, up 36% year over year. Retirement assets under custody hit $27.4 billion, up 90%. Net deposits grew at a 20% annualized rate. Adjusted EBITDA of $534 million grew from $470 million a year ago. But none of that offset the crypto crater, and the estimates reflect it.
The Estimate Collapse
The revision table is the bear case in numbers. Current year EPS sat at $2.32 ninety days ago. It is now $1.85, a 20% collapse in the consensus in a single quarter. Next year fell from $2.81 to $2.49 over the same window.
Nine analysts revised the current year lower in the last 60 days. Zero revised it lower in the last 7 days, which suggests the cuts may be stabilizing, but the damage is already done and the stock is priced for a recovery that depends heavily on crypto sentiment.
The Bitcoin Problem
Bitcoin has fallen from roughly $85,000 to $60,000 over the past month. That move matters enormously for Robinhood because crypto revenue is high margin and highly volatile.
When casual crypto traders step away, as management confirmed they did in Q1 and into April and May, the revenue impact is immediate and the expense base does not shrink with it.
Management is investing an additional $100 million in 2026 to build the Trump Accounts user interface, raising the full-year adjusted operating expense outlook to $2.7 to $2.825 billion. Spending is going up at exactly the moment crypto revenue is going down.
Technicals Look Bleak
After a huge run late last year, the stock has found a sideways trend along the $80 level. Recently the bulls tried to push the stock higher, but failed and the stock is back to the $80 level.
The long side is likely leaning on the $75 level, but if Bitcoin were to fall further and test the 2026 low of $63.50.
In Summary
The diversification is real but it is not enough to offset a 48% drop in crypto volume with Bitcoin heading lower. Current year estimates have lost 20 cents on the dollar in 90 days, expenses are going up, and the stock is priced for a crypto recovery that has not arrived. That is the Zacks Rank #5 in one sentence.
For those interested in a broker, check out Interactive Brokers (IBKR - Free Report) . The stock is a Zacks Rank #2 (Buy) that is coming off 2026 highs.