Analysts react as Robinhood slumps 10%, with slowdown in crypto trading weighing on results

Core Insights - Robinhood's shares fell 10% after Q4 revenue missed estimates, primarily due to a significant decline in crypto trading [1] - The company reported Q4 earnings per share of $0.66, exceeding expectations of $0.63, but revenue was $1.28 billion, below the forecast of $1.33 billion [1] - Crypto revenue dropped 38% year-over-year to $221 million, heavily impacting overall results [1] Revenue and Earnings - Transaction revenue was $776 million, falling short of expectations, driven by the decline in crypto revenue [3] - Net interest revenue of $411 million also missed estimates due to weaker securities lending and lower yields [3] Analyst Ratings and Price Targets - JPMorgan reduced its price target for Robinhood from $130 to $113 while maintaining a neutral rating, citing tougher comparisons for 2025 [2] - Compass Point's Ed Engel cut his price target from $170 to $127 but maintained a Buy rating, noting solid momentum in January KPIs despite the weak Q4 [4] Future Outlook - Engel highlighted Robinhood's guidance for 2026 operating expenses to grow by 18%, indicating spending for product expansion in areas like crypto and DeFi [5] - The decline in crypto take rate by 3 basis points quarter-over-quarter in Q4 and an additional 5 basis points in early 2026 was noted, as higher-volume traders dominate the mix [6] - Potential long-term tailwinds include internalization of prediction markets and possible mega-IPOs from companies like SpaceX and OpenAI [5]