Robinhood Markets, Inc.

Thank you to everyone for joining Robinhood's Q3 2026 earnings call, whether you're tuning into the live stream or here with us in Menlo Park. With us today are Chairman and CEO Vlad Tenev, CFO Shiv Verma, and VP of Corporate Finance and Investor Relations Chris Koegel. Vlad and Shiv will offer opening remarks and then open the call in a Q&A. During the Q&A portion of the call, we'll answer questions from the audience, which includes institutional research analysts, finance content creators who may hold an ownership position in Robinhood, and both institutional and retail shareholders. As a reminder, today's call will contain forward-looking statements. Actual results could differ materially from our current expectations, and we may not provide updates unless legally required. Potential risk factors that could cause differences, including regulatory developments that we continue to monitor, are described in the press release we issued today, the earnings presentation, and our SEC filings, all of which can be found at investors.robinhood.com. Today's discussion will also include non-GAAP financial measures. Reconciliations to the GAAP measures we consider most directly comparable can be found in the earnings presentation. With that, please welcome Vlad.

All right. Thank you guys for coming. This is awesome, and it's great to see so many people in person. We're back at our headquarters in sunny Menlo Park, so thank you again for being on this journey with us and showing up In person and to everyone watching remotely. So as you probably know, at Robinhood, we have a singular goal. We believe in ownership. We want to make everyone an owner. And we think that broad ownership is actually essential to a free, stable, and prosperous society. So in order to execute on this vision, we have our three-part strategy. So to recap that. The first part, we want to build the number one active trader platform. So we want to allow customers to own any tradable asset. And really, an active trader should feel like they're at a disadvantage trading elsewhere. So we'll have more about that later. Second, strategic arc, number one in wallet share for the next generation. So we want to build our customers' financial home, and not just for them, but for everyone and their families as well. Then the third, number one global financial ecosystem. So take the ownership that we've been able to deliver and grow in the US and expand it everywhere around the world. Q3, we made a lot of progress. So our product velocity continued across each of these three arcs and we saw strong business and financial results. So for active traders, again, the idea is if you're an active trader, you're at a disadvantage trading elsewhere. So what have we done for active traders? Last month, we held our third annual Hood Summit event in Houston, Texas, and we launched not one, not two, but 17 new products and new services to our customers. So I'll hit a couple highlights. Agentic Trading, which is Near and dear to my heart, literally, I'm wearing the best right now. So our agentic offerings have really increased in scope over the course of the year. If you remember, we started with our MCP, which has grown quite well. And now we've got agentic trading directly in the app, so you no longer need to use your external tool like your cloud code or codex. You can do it within the app. And we've also allowed customers to extend their MCP connectivity to Robinhood Legend. So Robinhood Legend is now in scope for our MCP connectors as well. So we're just continuing to make it easier for anyone to trade on our platform, whether it's you directly or your agents. And while we're still very early in the in-app capabilities and the harness tooling, we've been seeing really strong early adoption across the entire suite of agentic products. So customers have over 250 million in agentic accounts. Remember, the account started zero, so you have to make a choice to move money into them. and we look at the adoption curves both across usage and trading and they're sort of following an accelerating curve which gets us very excited about the future of these products. And as we continue to add more asset classes, more features, those curves appear to be steepening. Next, perpetual futures. So we became the first U.S. broker to offer what we call true perpetual futures. So these are perpetuals powered by our global derivatives exchange, Bitstamp, and they settle continuously around the day. So 15-minute settlement. We're also working on adding earnings contracts to our Prediction Markets Hub. I think this will be particularly relevant for this audience because it will allow you to trade EPS and revenue on individual companies as well as KPIs that are company-specific. and of course, something I've been very excited about for quite some time, we announced 24-7 equity trading that'll be coming to Robinhood later this year. And again, this is something I think we'll be the first to offer this as well. And these are just a few of the many items we've shipped. So there's a lot more and I encourage you all to check out the full keynote on YouTube or X if you haven't already. So let's move to wallet share. A couple of things that I'd like to highlight here. Trump accounts achieved a really important milestone in Q3, auto-enrollment. So, as we said before, We've got nearly 70 million children in the U.S. under the age of 18 that are eligible for the Trump account. And now the U.S. Treasury has opened accounts for all of them, for all these children. And because of the generous gift from Michael and Susan Dell through their foundation, 25 million of those children already had $250 invested for them by the Dell Foundation. So we're excited about this initiative. It's one of those things where it's just been snowballing and we're doing more, so there's just a ton of roadmap ahead. One of the things I'm particularly excited about is I think it can become the default vehicle for philanthropic giving in this country. And we're already seeing the beginnings of that with the Dells, but also the other donors. We don't really have a great default option. I think Trump accounts can become that, so we're going to be doing more there in partnership with BNY and the U.S. government. We're also continuing to make progress with Robinhood Gold, which today is one of the largest paid membership programs in consumer finance in the U.S. So a couple of years ago, we set out to actually completely revamp our gold product. What we wanted to do is put something in gold for our mass market customer so that you didn't have to be an active trader to benefit from gold. I think we've been able to achieve that. In this quarter, Robinhood Gold reached 5 million subscribers. We see it really paying off. We see it paying off. We've got 5 million gold subscribers. and that's up over 30% year over year. And it's a 4X increase from when we began the journey to revamp the gold program just about four years ago. So that gets us to about an 18% overall gold adoption rate when you look at our customer base, but 40% if you look at in quarter. So of the customers that joined Robinhood in quarter, much higher adoption. and that's really great to see because then we see a path as we continue to grow, gold will just continue to increase. And I think there's actually much more room to grow. Our big bets for growing the gold value proposition are banking and credit. And those are still, despite getting to large scale, not generally available yet. So there's still limited release. and we've been really investing in more integration points. So things like easy sign up for banking and gold card if you're signing up for Robinhood. Contextual upsells so that we detect when banking and credit is going to be appropriate for you when you're using the Robinhood app and kind of putting it there. So we think we've got plenty of room to run. These can become even more meaningful drivers of higher gold adoption. Finally, let me get to global financial ecosystem. So on July 1st, just a few months ago, we launched the Robinhood Chain Mainnet. And in its first quarter, it's already a top five chain by volume and revenue. So far, we've seen over $100 billion in DEX volume. So it's $100 billion in decentralized exchange trading volume and over $50 million in chain fees. DeFi Perpetuals, it's an interesting, innovative product, have seen solid growth on the chain as well. So in recent weeks, we've been seeing DeFi Perpetuals volume of over a billion dollars per day on the chain. So it's clear customers have demand for these tokenized assets on-chain. We think, we not only believe, we're building Robinhood Chain to be the best place to own and trade all of these tokenized assets. Of course, starting with stock tokens and perpetuals, but expanding much broader from that. We're also expanding our brokerage infrastructure globally, and we're excited with that to announce that we received authorization from the Dubai Financial Services Authority to launch Robinhood in the region. This will broaden our international footprint even further. The product velocity that you've been seeing and the focus on the customer experience have led to really strong business results. Market share continues to grow up double digits year over year for each of the main assets, equities, options, crypto, and margin as well. Revenues grew 12% year over year to a record $1.4 billion. Adjusted EBITDA, that's up 9%, record of over $800 million. And then net deposits, $16 billion and a quarter. And with a strong start to Q4, which Shiv will talk more about, we have already exceeded our annual goal of 20% net deposit growth. And that's with two months left to go. So we're pleased with the strong results for our customers and for our business. We're pushing hard to make Robinhood your financial super app. So with that, I'll ask Shiv to come up. How are you doing, sir? Doing all right. All right.

So thank you, Vlad. Before we get into the results, I just wanted to share three big takeaways from Q3. First, as Vlad said, the core business is firing on all cylinders. This led to our highest quarter ever for both revenue and adjusted EBITDA, and really great to see platform assets for nearly $400 billion. And on top of that, we set new records for equities, options, event contracts, and margins, so going well all around. Second, our product is driving a more diversified business. We're now up to 14 cylinders that have reached $100 million or more of annualized revenue. As Rothera, our prediction markets exchange, Hit this number in just its first full quarter of operation. So really nice to see Rosera scaring well. And then finally, we drove another quarter of strong growth, profitability, and scale. So we're a rule of 80 company, but at our scale of over $5.5 billion of annualized revenue. So we remain disciplined on expenses, even while investing for growth, which is fantastic to see. So let's get to our Q3 results, and all of these will be compared to a year ago. So revenues were up 12% to a record $1.4 billion, and this was driven by strong growth in both new products and existing products as well. Transaction revenues were a record, as trading volumes were new highs across equities, options, and margin. Each of these was up around 50% year over year, and this was on market share gains. And the event contracts continued to go really nicely. This was up 7x year over year. Additionally, the Robinhood chain in its first quarter of adoption saw really strong usage, as Vlad mentioned before. So that was another driver of transaction revenue in the quarter. And then on NIM, or net interest revenues, really strong growth in margin, credit card book, and Robinhood banking. And these grew to new record balances. And our total interest-earning assets on the platform also hit new highs. So really nice to see both transaction revenue and the interest-earning assets do well. And then finally, in other revenues, as Vlad shared before, gold subscribers reached a new all-time high of over 4 million subs, which is great to see. And then additionally, as we continue to build and expand the Trump accounts for customers, that generates some additional revenue as well. And so while revenues grew to a quarterly record, we also see discipline on costs. and so it jumps it off back to the SEC was managed to $664 million. This was managed within our prior outlook range. And again, as we're investing for growth, we're still being really, really disciplined on our expenses. And our productivity also continues to do really well. So in this quarter, we hit revenue per employee of nearly 2 million, which would be a new record. So we're shipping for customers, but we're also doing it in our lean and disciplined way. And then finally, as we look ahead to Q4, while we plan to continue making growth investments, in particular in the Trump accounts, we're also controlling our expenses and have driven more efficiencies across our business. So as we do that, we're going to lower the top end of our prior outlook range by $25 million, and we now expect full-year adjusted outbacks in SBC to be between $2.675 and $2.75 billion. And this is $13 million lower at the midpoint versus our prior outlook. So you put them together, really strong top-line growth, expense discipline, and this led to a strong quarter of profitability. So adjusted EBITDA was a record $808 million. This is up 9% year-over-year. And adjusted EBITDA margin continues to be strong at 57% in Q3. EPS for the quarter was $0.51. Now this includes a minus $0.07 of mark-to-market impact on investments that we hold. And so as we talk about EPS, We're continuing to expand our business into investments, one of them is such as Robin Hood Ventures. And as we launch more and more of these products, we're now seeing some non-operating movements on all these investments. So we're introducing adjusted EPS, and this is to just better reflect our core operating profitability before any gains or losses on investments or some of these other non-operating items. But at the same time, we're going to remain accountable for all of our regular ongoing costs. So we're still including normal course SBC in our adjusted EPS. As I've said before many times, share count and the denominator matters. And so you put it all together, in Q3, adjusted EPS was $0.60. And so moving forward, we hope that investors find this a useful measure of our core profitability in the business. Another area I wanted to touch upon is prediction markets. We believe it's really early innings for the asset class, and we're investing to be a leader in the space. We're constantly improving the in-app experience. We now have a vertically integrated exchange with Thera, and as I mentioned before, it's off to a great start. Additionally, we also announced a recent partnership with Crypto.com and OG.com. Now, this is really exciting for both our customers, but also for our business and shareholders. It's really important for us that customers have a best-in-class selection with consistent pricing across exchanges and with these partnerships that are now allowed us to do that. But additionally, with no cash outlay, we received an initial 1% equity ownership stake in Crypto.com and OG.com. And we have the ability to earn up to 10% ownership depending on how much we partner together in the years to come. So before we move to Q&A, I just wanted to give a little bit about how Q4 looks to start following a record Q3. October net deposits are over $13 billion a month, great to see, and that includes $6 billion of the Dell family gift to Trump accounts, as Vlad mentioned earlier. And this brings our total year-to-date net deposits to over $68 billion. This is already a new annual record and north of our 20% growth target, with still a few months to go left in the year. And then compared to Q3, average daily volumes for equities, options, and cryptos are off to a good start and are about 5% lighter relative to the really strong Q3. And then event contract ADVs are already up about 10% to start the quarter. So stepping back, it was great to see another strong quarter in Q3, and we're really excited about our momentum entering Q4. And as we've shared before, our financial North Star remains the same. Maximized earnings per share and free cash flow per share for shareholders over time. All right, Chris, Vlad, should we take some questions?