I Predicted the 50% Plunge in Robinhood Stock. Here's What Could Happen Next.

Core Insights - Robinhood's crypto revenue is experiencing a significant decline, contributing to a drop in monthly active users and overall stock performance [1][10][15] - The company's stock has seen a dramatic decrease of up to 53% since its peak last October, with predictions of further declines [1][16] - The surge in Robinhood's value in 2025 was largely driven by speculative trading in cryptocurrencies, which has since waned [2][6] Financial Performance - In Q4 2024, Robinhood's crypto transaction revenue peaked at $358 million, accounting for over half of total transaction revenue, but fell to $221 million in Q4 2025, a 38% decrease [9][10] - The company's total revenue for 2025 was reported at $4.47 billion, with the prediction segment generating $435 million, less than 10% of total revenue [5][6] - Options trading has become the largest source of transaction revenue, but this is subject to volatility based on market conditions [12][15] User Engagement - Robinhood had an average of 13 million monthly active users in Q4 2025, reflecting a 13% decline year-over-year and sequentially [15] - The platform's user base is primarily composed of young, first-time investors who are highly active during market upswings but tend to withdraw during downturns [3][15] Valuation Concerns - Robinhood's stock is currently trading at a price-to-sales (P/S) ratio of 15.9, significantly above its historical average of 11.5 since going public [13][15] - The decline in crypto revenue and the reliance on risky options trading raise concerns about the sustainability of the current valuation [15]