Robinhood Markets, Inc. Reports February 2024 Operating Data
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Insights
The reported growth in Funded Customers and Assets Under Custody (AUC) for Robinhood indicates a positive trend in customer acquisition and retention, which is crucial for the company's revenue generation. A 16% month-over-month increase in AUC and a 29% annual growth rate in Net Deposits are significant indicators of customer trust and an expanding user base. These metrics are essential for evaluating the company's financial health and growth trajectory, especially when considering the competitive landscape of online brokerage platforms.
Moreover, the substantial increase in Trading Volumes across all asset classes suggests heightened trading activity, which could lead to increased transaction-based revenues. The rise in Margin Balances and Total Cash Sweep Balances also points to an increase in revenue-generating activities for Robinhood, such as interest on margin lending and cash management services. However, it is important to note the potential risks associated with margin lending, such as credit risk and market volatility that could affect the company's financial stability.
The Total Securities Lending Revenue, despite being up 8% month-over-month, shows a year-over-year decline of 24%. This discrepancy could be due to a variety of factors, including changes in market demand for securities lending or alterations in Robinhood's revenue strategies. Investors should monitor these figures closely, as they could have implications for future revenue and profitability.
Robinhood's performance metrics provide valuable insights into user engagement and platform utilization. The growth in Equity Notional Trading Volumes and Options Contracts Traded is indicative of an increased appetite for investment risk, which may be driven by market conditions or enhanced user confidence in Robinhood's platform. The uptick in Crypto Notional Trading Volumes reflects the ongoing interest in cryptocurrency trading, despite the volatile nature of this asset class.
It is also noteworthy that the Total Cash Sweep Balances have seen a substantial year-over-year increase. This could suggest that users are opting to keep more idle cash in their Robinhood accounts, potentially due to the platform's cash management features or as a strategic response to the current interest rate environment. This trend can be seen as a positive sign of user engagement and trust in the platform's ability to manage funds.
These metrics provide a snapshot of Robinhood's operational performance and can be used to benchmark against competitors. The data suggests that Robinhood is successfully capitalizing on market opportunities and user trends, which could have favorable implications for its market position and future growth prospects.
The data from Robinhood reflects broader economic trends, such as retail investor participation in the financial markets and the impact of economic conditions on investment behavior. The increase in Net Deposits and Assets Under Custody implies that despite potential economic headwinds, retail investors remain active, which could be a sign of consumer confidence or a search for yield in a low-interest-rate environment. This behavior has implications for the overall market liquidity and volatility.
Furthermore, the rise in Margin Balances suggests that investors may be leveraging their investments to capitalize on market opportunities, which could amplify market movements. The growth in Trading Volumes indicates that retail investors continue to play a significant role in market dynamics. This can have both stabilizing effects, through increased liquidity and destabilizing effects, if driven by speculative trading.
Lastly, the increase in Cash Sweep Balances could be interpreted as a sign that investors are keeping cash reserves in a volatile market, which may reflect a cautious outlook on future market conditions. This behavior could potentially influence monetary policy considerations, such as interest rate decisions, which affect the broader economy.
MENLO PARK, Calif., March 13, 2024 (GLOBE NEWSWIRE) -- Robinhood Markets, Inc. (“Robinhood”) (NASDAQ: HOOD) today reported selected monthly operating data for February 2024:
- Funded Customers at the end of February were 23.6 million, up approximately 130 thousand from January 2024.
- Assets Under Custody (AUC) at the end of February were
$118.7 billion , up16% from January 2024. Net Deposits were$3.6 billion in February, translating to a42% annualized growth rate relative to January 2024 AUC. Over the last twelve months, Net Deposits were$21.6 billion , translating to an annual growth rate of29% relative to February 2023 AUC. - Trading Volumes in February were higher across all asset classes relative to January 2024. Equity Notional Trading Volumes were
$80.9 billion (up36% ). Options Contracts Traded were 119.1 million (up12% ). Crypto Notional Trading Volumes were$6.5 billion (up10% ). - Margin Balances at the end of February were
$3.8 billion , up6% from the end of January 2024. - Total Cash Sweep Balances at the end of February were
$18.1 billion , up$1.3 billion or8% from the end of January 2024. - Total Securities Lending Revenue in February was
$13 million , up8% from January 2024.
| February 2024 | January 2024 | M/M Change | February 2023 | Y/Y Change | |
| (M - in millions, B - in billions) | |||||
| Funded Customer Growth (M) | |||||
| Funded Customers | 23.6 | 23.5 | - | 23.1 | 2% |
| Assets Under Custody (AUC) ($B) | |||||
| Total AUC | 16% | 59% | |||
| Net Deposits | NM | NM | |||
| Trading | |||||
| Trading Days (Equities and Options) | 20 | 21 | (5%) | 19 | 5% |
| Total Trading Volumes | |||||
| Equity ($B) | 36% | 41% | |||
| Options Contracts (M) | 119.1 | 106.2 | 12% | 89.4 | 33% |
| Crypto ($B) | 10% | 86% | |||
| Daily Average Revenue Trades (DARTs) (M) | |||||
| Equity | 1.9 | 1.7 | 12% | 1.6 | 19% |
| Options | 0.8 | 0.7 | 14% | 0.7 | 14% |
| Crypto | 0.3 | 0.3 | - | 0.2 | 50% |
| Customer Margin and Cash Sweep Balances ($B) | |||||
| Margin Book | 6% | 15% | |||
| Total Cash Sweep | 8% | 126% | |||
| Gold Cash Sweep | 8% | 149% | |||
| Non-Gold Cash Sweep | - | (30%) | |||
| Total Securities Lending Revenue ($M) | 8% | (24%) | |||
For definitions and additional information regarding these metrics, please refer to Robinhood’s full monthly metrics release, which is available on investors.robinhood.com.
The information in this release is unaudited and the information for the months in the most recent fiscal quarter is preliminary, based on Robinhood’s estimates, and subject to completion of financial closing procedures. Final results for the most recent fiscal quarter, as reported in Robinhood’s quarterly and annual filings with the U.S. Securities and Exchange Commission (“SEC”), might vary from the information in this release.
About Robinhood
Robinhood Markets, Inc. is on a mission to democratize finance for all. In the U.S., people can invest with no account minimums through Robinhood Financial LLC, a registered broker dealer (member SIPC), buy and sell crypto through Robinhood Crypto, LLC, spend and earn rewards through debit cards with Robinhood Money, LLC and credit cards with Robinhood Credit, Inc., trade U.S. stocks without commission or FX fees in the UK through Robinhood U.K. Ltd., trade crypto in select jurisdictions in the European Union through Robinhood Europe, UAB, and access easy-to-understand educational content through Robinhood Learn.
Robinhood uses the “Overview” tab of its Investor Relations website (accessible at investors.robinhood.com/overview) and its Newsroom (accessible at newsroom.aboutrobinhood.com) as means of disclosing information to the public for purposes of the SEC’s Regulation Fair Disclosure (Reg. FD). Investors should routinely monitor those web pages, in addition to Robinhood’s press releases, SEC filings, and public conference calls and webcasts, as information posted on them could be deemed to be material information.
"Robinhood" and the Robinhood feather logo are registered trademarks of Robinhood Markets, Inc.
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FAQ
How many funded customers did Robinhood have at the end of February 2024?
What was the Assets Under Custody (AUC) at the end of February 2024?
What were the Net Deposits in February 2024?
How did the Trading Volumes in February 2024 compare to January 2024?
What was the percentage increase in Margin Balances at the end of February 2024 compared to January 2024?
What was the Total Securities Lending Revenue in February 2024?
