US neobroker Robinhood Markets, Inc. (NASDAQ:HOOD) has reported its results for the second quarter of 2024, posting a second consecutive quarter of record Revenue and Profit as the company seems to be hitting on “all cylinders” in a very positive environment for brokers.

On the top line, total net Revenues at Robinhood increased 40% year-over-year – and by 10% over Q1’s record $618 million – to $682 million. Transaction-based (i.e. actual brokerage) Revenues increased 69% year-over-year to $327 million, which interestingly make up less than half of Robinhood’s total income. Transaction Revenues were primarily driven by Options revenue of $182 million, up 43%, Crypto revenue of $81 million, up 161%, and Equities revenue of $40 million, up 60%.

The largest individual Revenue item for Robinhood is now actually Interest income, with net interest revenues increasing 22% year-over-year to $285 million, driven by growth in interest-earning assets, increased securities lending activity, and – mainly – higher short-term interest rates. Interest income thus makes up fully 42% of Robinhood’s top line Revenues, at least for now.

Other revenues increased 19% year-over-year to $70 million, primarily due to increased Gold subscription revenues.

On the bottom line, Net Income for Q2 increased to $188 million, or diluted earnings per share (EPS) of $0.21, compared to $25 million, or diluted EPS of $0.03, in Q2 2023.

Despite the impressive set of results, Robinhood shares didn’t move much in aftermarket trading following the release of the information. As of the time of writing, Robinhood shares were up by about 2.2%, to $17.50, versus Wednesday’s close of $17.12. Robinhood shares are actually down about 30% over the past month, after hitting a 52 week high of $24.88 in mid July.

Robinhood share price past 12 months. Source: Google Finance.

Vlad Tenev, CEO and Co-Founder of Robinhood, said of the company’s Q2 performance,

“This quarter, we kept up the pace with rapid product launches and a relentless drive to provide top value for our customers. With Robinhood Gold reaching 2 million subscribers, we’re witnessing the flywheel accelerate.”

Jason Warnick, Chief Financial Officer of Robinhood, added,

“I’m encouraged by the progress we’re making as a business. In Q2, we set new quarterly records for revenues and earnings per share as we continue to focus on delivering another year of profitable growth.”

Other financial highlights for Robinhood in Q2 2024 include:

• Adjusted EBITDA (non-GAAP) increased 99% year-over-year to $301 million.
• Funded Customers increased by 1.0 million year-over-year to 24.2 million. Investment Accounts increased by 1.4 million year-over-year to 24.8 million.
• Assets Under Custody (AUC) increased 57% year-over-year to $139.7 billion, driven by continued Net Deposits and higher equity and cryptocurrency valuations.
• Net Deposits were $13.2 billion, an annualized growth rate of 41% relative to AUC at the end of Q1 2024. Over the past twelve months, Net Deposits were $33.0 billion, a growth rate of 37% relative to AUC at the end of Q2 2023.
• Average Revenue Per User (ARPU) increased by 35% year-over-year to $113.
• Gold Subscribers increased by 750 thousand, or 61%, year-over-year to 2.0 million.
• Cash and cash equivalents totaled $4.5 billion compared with $5.8 billion at the end of Q2 2023.

Other notes from Robinhood’s Q2 release:

• Robinhood Gold reaches record 2 million subscribers – More than 8 percent of Funded Customers are now Gold Subscribers.
• 1% bonus drives over $3 billion in asset transfers – From April 30, 2024 to June 28, 2024 customers responded to Robinhood’s 1 percent transfer bonus by bringing over $3 billion, averaging approximately $130 thousand per customer.
• Strategic acquisitions advance roadmap – In June, Robinhood entered into an agreement to acquire Bitstamp, a globally-scaled crypto exchange, with over 50 active licenses and registrations internationally and customers across the EU, UK, US and Asia. In addition, Robinhood acquired Pluto Capital Inc., an artificial intelligence (AI) powered investment research platform in July.
• Delivering even more for advanced investors – In May, Robinhood launched industry leading margin rates, ranging from 5.7 to 6.75 percent. Margin balances grew by over 20 percent in Q2, reaching a two-year high of $5.0 billion.
• Returning value to shareholders – In May, Robinhood’s Board of Directors authorized a $1 billion share repurchase program, which we began executing in July 2024.  Management currently expects to execute this program over a two to three year period.
• Bringing customers together for Hood Summit 2024 – Robinhood announced it will be hosting its first-ever customer-focused conference, happening October 16-18, 2024. Attendees will join Robinhood executives and other industry leaders to hear about the latest in trading technology, investing and finance culture.

Robinhood noted some additional Q2 2024 Operating Data:

• Retirement AUC totaled $8.7 billion compared with $0.8 billion at the end of Q2 2023.
• Cash Sweep increased 76% year-over-year to $20.9 billion.
• Margin Book increased 52% year-over-year to $5.0 billion.
• Equity Notional Trading Volumes increased 57% year-over-year to $243.6 billion.
• Options Contracts Traded increased 38% year-over-year to 389.7 million.
• Crypto Notional Trading Volumes increased 137% year-over-year to $21.5 billion.
• Monthly Active Users (MAU) increased 9% year-over-year to 11.8 million.