Robinhood swings to profit from year-ago loss
2024.05.08 16:30
(Reuters) -Robinhood Markets reported a profit in the first quarter on Wednesday compared with a loss last year, helped by strong trading volumes and rate hikes that boosted its net interest revenue.
The company reported a profit of $157 million or 18 cents per share for the three months ended March 31, compared with a loss of $511 million or 57 cents per share a year ago.
Policy tightening by the Federal Reserve has allowed companies to increase earnings from their cash deposits and their portfolio of bond investments.
Brokers like Robinhood (NASDAQ:), which offers traders the ability to borrow against their investments, can now charge higher interest rates on these loans.
The company’s net interest revenue jumped 22% to $254 million.
The prospect of a soft landing also spurred retail traders to re-enter the market, leading the Menlo Park, California-based company to achieve a 59% increase in transaction-based revenue.
