Robinhood's Prediction Market Business Surges as Revenue Hits Record

Rights to bet on events such as sports games and elections are driving revenue for Robinhood.

The fintech company's prediction market business, which allows users to wager on outcomes, saw a surge in volume with 13 billion contracts traded in Q2 compared to 9 billion in the first quarter. This led to a significant increase in revenue from $104 million in Q1 to $156 million in Q2.

CFO Shiv Verma noted that Robinhood is working to lower its spread on less popular bets by directing more transactions through Rothera, an in-house offering managed with market maker Susquehanna. This move aims to offer users lower fees.

The company's overall revenue reached a record $1.31 billion, beating analyst expectations of $1.25-$1.28 billion. However, its cryptocurrency business continues to decline, generating only $100 million in Q2, down 38% from last year.