HOOD
The headline isn’t the only thing getting trimmed
JP Morgan’s Kenneth Worthington basically said Robinhood’s Q1 was a little too soft in the places that matter most: transaction revenue and net interest revenue. That’s a rough combo for a company that’s still trying to prove its revenue mix can stay sturdy when trading activity cools off.
Why the Street is side-eyeing the model
Here’s the punchline: Robinhood reported $1.07 billion in revenue, below the $1.14 billion consensus, while EPS landed at 38 cents versus 43 cents expected. The analyst pointed to weaker take rates in options and crypto, plus softer securities lending in a quieter IPO backdrop. Translation: the engine still works, but a few cylinders are sputtering.
The bright spots are real, but so is the pressure
Not everything was a faceplant. Net deposits came in at $17.7 billion, which is a pretty chunky vote of confidence from users. And management is still talking up new initiatives like Trump Accounts and even AI-flavored brokerage tools. Cute? Yes. Material? Potentially. Immediate stock fix? Not really.
What this means for your Robinhood thesis
Worthington’s move is less about panic and more about a valuation reset. He kept the Neutral rating but cut his December 2026 target to $89 from $92, saying the market should probably pay less for revenue streams that look a bit less durable than hoped. With the stock down hard on Wednesday, investors are now asking the old market question: is this a dip, or just the model blinking?
Big picture: Robinhood still has growth levers, but when the core money-makers wobble, Wall Street gets a lot less generous very quickly.