Robinhood

IThe business

What it does

Robinhood runs a brokerage on a phone. Customers trade stocks, options, crypto, futures and event contracts, which are yes-or-no bets on outcomes priced from 1 cent to $1. It also lends against their shares, sells a paid membership called Gold, issues a credit card through Coastal Bank, offers banking and retirement accounts, and owns the crypto exchange Bitstamp.⁴ Since July 2026 it has also been broker and sole initial trustee for Trump Accounts, the federal children’s accounts.³

Stock and options trades cost the customer no commission. Robinhood is paid by the market makers that fill the orders, which is called payment for order flow, and it earns interest on the cash and loans in the accounts. So the customer rarely sees a bill, and that shapes everything on this page. Revenue depends on how much people trade and how much money sits idle, and both move with the mood of the market.

In the twelve months to 30 September 2026 revenue was $5.08B C (calculated). Transaction revenue was $3.04B, net interest $1.57B and other revenue, mostly Gold and Trump Account service fees, $0.47B C (calculated).⁴³ Net income was $1.98B, a 39% net margin C (calculated). Those figures are reported, and they are real. The next section of this page is about why they are not the same as what an owner could take out.

A year in the mix

The mix moved a lot in twelve months, and that is the best thing about the last year and also a warning. Compare the third quarter of 2026 with a year earlier. Crypto revenue fell 55% to $120M, as the number of customers trading crypto fell 37%. Securities lending, $87M a year ago, was −$19M because the market for hard-to-borrow stock weakened.³ Those two lines lost $254M between them. Event contracts rose from $27M to $173M, options from $304M to $399M, equities from $86M to $121M and margin interest from $153M to $244M. Total revenue still grew 12%.³

Three years ago that loss would have been a bad quarter. Now the company has 14 lines above $100M of annualized revenue.² That is real diversification by product. It is much less diversification by cause. Options, equities, crypto, event contracts, margin and securities lending all need the same thing: a customer who wants to take risk.

Fourteen businesses, one mood. When retail risk appetite falls, most of them fall together.

Net interest, the steadier half

Robinhood earned $415M of net interest in the third quarter on $76.7B of interest-earning assets, 2.26% R (reported).³ The $22.1B margin book yielded 4.54%, up 59% in balance on a year. In February 2026 it changed its High-Yield Cash program so that more than $6B of customer cash moved out of partner banks and onto its own balance sheet, where it can fund those margin loans.² That makes margin growth cheaper to fund. It also makes the customer’s cash more expensive, which is why interest on segregated cash fell 47% to $55M.³

Rates matter, but less than they did. The 10-Q says a 1 point change in rates moves pretax income by about $366M a year, before any effect on trading.³ That is 16% of my trailing operating income C (calculated). Credit is newer. The card book reached $1.84B, and the total provision for credit losses was $71M in the quarter, up 173%, and the yield of 11.82% has to pay for those losses.³ The book is small, and young books have not been tested. I have no card losses through a recession to look at.

Event contracts

This is the line everyone watches. Revenue was $173M in the third quarter, 12% of the company, on 16.4 billion contracts, about 1.05 cents each C (calculated).²³ The 10-Q says the growth was predominantly sports. Management put non-sports at about 30% in the quarter, up from 15% the quarter before, so sports is still about 70%.¹⁹ With Susquehanna, Robinhood owns Rothera, an exchange and clearinghouse bought for $79M, which passed $100M of annualized revenue in its first full quarter.³²

In September it agreed to route some contracts to Crypto.com’s exchange in return for up to 10% of the equity over three years, with no cash paid; management says it has received the first 1%.³¹⁹ It is an unusual trade: a stake in a rival venue, earned by sending it volume. Section VIII covers the legal fight, which is the largest single unknown here.

Trump Accounts

Treasury has now opened accounts for nearly 70 million children, and 25 million of them hold $250 from the Dell gift.² Robinhood builds and runs the platform and earns service revenue. That shows up in other revenue, which rose 115% on the ’Other’ line to $73M in the quarter, though the filing does not split out how much is Trump Accounts.³ Management expects about $100M of investment in the program this year.¹⁹ I can’t judge the economics. No contract terms that I can find give a margin or a term. The prize, if there is one, is seventy million young Americans who first meet investing through a Robinhood-built app. The risk is that a federal program becomes political, and the filing says so.³

IIThe moat

What the protection really is

Brokerage has none of the classic protections. Commissions are zero at every serious rival. A customer can move an account in days, and Robinhood pays people to do exactly that, so rivals can too. Its 10-K lists competition from legacy firms, technology companies and new entrants, and names product innovation, efficiency, engineering talent and brand as what decides it.⁴ Those are real, but they are things you keep winning, not things you own.

I see three sources of protection, in order of how much I trust them.

1. Cost. Robinhood has few branches to pay for and no advisers. Operating costs were 54% of revenue over the twelve months C (calculated). Revenue per employee is near $2M by management’s count.¹⁹ It built its own clearing and most of its stack, and it cut about 10% of staff in June while volumes were at records.¹⁴ A low-cost seller of a commodity can last a long time.
2. A young customer who may stay. The average customer holds about $13,800 C (calculated).² Older firms own the money now. If this cohort stays as it earns and inherits, the assets arrive without new marketing. If they leave for an adviser at 45, they don’t. Nobody has watched a phone-native cohort through that yet, so this one is a hope with some early evidence: $36.6B in retirement accounts, up 51%.²
3. The bundle. Gold has 5.2 million subscribers, 18% of customers, and about 40% of new ones.² It earns about $4 a month per subscriber C (calculated) and carries better interest and access to the card. Each extra link makes leaving a little harder. Management says customers on three or four products are worth much more.¹⁹

Gold revenue was $62M in the quarter, only 4% of revenue.³ Its value lies in what it holds in place. That is the closest thing here to a real switching cost, and it is still one that a rival can buy with a better rate.

How well it is working

Net deposits were $71.0B in twelve months, 21% of opening assets R (reported).² That is the number I would look at first, and it has to be read with care. Since July it includes Treasury seed money and Trump Account contributions, and October’s $13B includes $6B from the Dell family.² The 10-Q does not give organic deposits, so I can’t show them. Platform assets also now include TradePMR adviser assets, WonderFi crypto and Trump Accounts.² The trend is strong, and some of it was bought or granted.

Then look at what each dollar earns. Revenue per $100 of average platform assets was $2.26 in 2023, $2.00 in 2024, $1.74 in 2025 and $1.39 in the last twelve months C (calculated). Assets have grown faster than the income on them.

Some of that fall is healthy. A retirement dollar trades less than a crypto dollar and stays longer. But the direction matters, because every case on this page is really a view about where this line settles. Section III shows where the mature firms sit.

IIIThe competitive advantage

Against the firms it wants to beat

Here is the whole argument in one table. Robinhood earns far more on each dollar than the giants, and it is growing much faster from a far smaller base.

Schwab holds about 34 times Robinhood’s assets and earned $2.9B in the quarter against $468M C (calculated).²⁷³ Interactive Brokers holds about 2.4 times the assets, and serves active, professional-minded customers at low cost.²⁸

Robinhood’s $1.44 is not a stable number. It reflects a customer base that trades a lot and keeps small balances. As accounts get larger and older, trading falls relative to assets, and the figure heads toward its rivals. My base case assumes it does: core revenue per $100 falls from about $1.24 in 2026 to $0.88 by 2036, still four times Schwab’s rate today E (estimate). That is fairly generous.

Where it wins

• Speed of product. It launched 17 products at its September event. Perpetual futures, stock tokens, a blockchain, agentic trading accounts and 24-hour stocks are in market or announced.² Bigger firms move more slowly and have more to protect.
• Options and active traders. Contracts traded rose 48% to 905 million, a record, and equity volume rose 53%.² The 10-Q puts the options gain on more contracts per trader, while the number of traders fell 11%.³ So a smaller group is trading harder, and that is a concentration worth watching.
• Being first where rules are loose. Prediction markets took off here because it moved early. In a young market that is an edge; in a regulated one it can also be the risk.

Where it is weak

• Crypto. The customer has a dozen other places to go, and revenue fell 55% in a quarter when Bitstamp and the app both lost volume.³ Robinhood Chain made over $50M of fees in its first quarter, and management said some of that came from congestion that may not last.²¹⁹
• Execution revenue is not contracted. The 10-Q says payment arrangements with market makers are often not documented in binding contracts.³ Citadel Securities alone was 17% of total revenue in the quarter, up from 13% a year before R (reported).³
• Spreads. Management said spreads looked a little tighter early in the fourth quarter, and that take rates came in lighter across products in the third.¹⁹ Options revenue per contract was about $0.44, down from about $0.50 a year earlier C (calculated).²
• A short record of trust. The firm paid $45M to the SEC in January 2025 and settled with FINRA in March 2025 over matters that include collaring orders and clearing supervision.⁴ The New York Attorney General is looking at execution quality.³

The advantage is real and it is young. It is mostly a lead in cost and pace, and leads have to be renewed.

IVManagement

Who runs it

Vlad Tenev co-founded Robinhood in 2013 with Baiju Bhatt and has been sole CEO since November 2020; Bhatt remains a director. He is chair and CEO.¹⁰ He is also executive chairman of Harmonic, an AI company, and Bhatt is founder and chief executive of Aetherflux, a renewable energy company.¹⁰ The chief financial officer, Shiv Verma, 40, took over in February 2026 after years in finance and strategy at the company. The chief technology officer left in May and about 10% of staff went in June.¹⁶¹⁵¹⁴

He is a capable product leader. The record since 2022 shows it: revenue up about 3.7 times and costs up only 17% C (calculated).⁴³ Crypto fell from 21% of revenue to 8% in a year and the company kept growing, which is not something the 2022 version of this firm could have done.³

How he is really paid

Follow the money. Tenev’s salary was $34,248 in 2025. Security and private-aircraft costs brought reported pay to $3.0M.¹⁰ That looks modest and it is misleading. In 2025 his 2019 market-based stock awards finished vesting, and he took $1.12B of stock, 11.07 million shares, when price hurdles were met.¹⁰ So he has been paid almost entirely on the share price.

That aligned him with holders while it lasted, in one sense. A stock hurdle pays for a price, though, however that price was reached, and those hurdles are now done. The proxy says the board is evaluating future pay for him.¹⁰ A second large award is the thing to read when it comes: its size, its hurdles, and whether they are per-share measures. The 2021 founder awards were cancelled at a cost of $485M in stock pay expense, recorded in 2023, which is a fair sign that the board can correct itself.⁶

Other senior officers have a bonus paid on revenue, adjusted net income, net deposits, Gold growth and international accounts. In 2025 it paid 177% of target.¹⁰ That pays them to grow. None of the five measures charges for capital, and three of them reward size. The company’s stated aim is the right one: earnings and free cash flow per share.¹⁹ The bonus plan doesn’t yet say that.

Their own money

Tenev held about 48.7M shares at 8 April, worth about $4.1B at this price, and Bhatt about 61.1M, about $5.2B C (calculated).¹⁰ Together that is about 12% of the company and, through ten-vote Class B shares and a voting agreement, about 58% of the votes C (calculated).¹⁰ Outside holders can’t remove them. A 98% say-on-pay result means little in that setting.¹¹

In the past twelve months Tenev sold 2.0M shares for $221M and Bhatt 2.26M for $264M.²¹ On 14 September Tenev adopted a plan to sell up to 1.9M more by November 2027.³ That is about 4% of his stake a year, so nobody would call it an exit. The price they got averaged about $110 and $117, well above today’s C (calculated). The other side of the ledger is more interesting: between 28 May and 5 June 2026, Bullfrog Capital, a fund linked to director Meyer Malka of Ribbit Capital, bought 680,000 shares in the open market at about $81, about $55M. Malka disclaims beneficial ownership beyond his financial interest.²⁰ The insider who bought knew the business well and paid less than today’s price.

What they did with capital, through a full cycle

The company raised $2.05B at its IPO in July 2021 at $38.⁸⁹ The shares then fell 82% to $6.89 in June 2022.¹ What it did next is the best evidence on this page about judgement.

In September 2023 it bought 55.3M shares from the US Marshals Service at $10.96 each, about $606M.⁶ At $84.99 those shares are worth $4.7B C (calculated). That was a very good purchase, made when cash was $4.8B and the company was losing money. The later program has bought 27M shares at an average of about $48, also good.²

The June 2026 convertible is cheap financing. Robinhood borrowed $2.2B at zero interest to 2029, converting at $174.42, with capped calls lifting the dilution point to $237.85. It spent $290M of the proceeds on 2.74M shares at $105.71, 24% above today’s price, which so far looks less good, and $123M on the calls.¹²

Add it up. Since the start of 2023 the company has spent about $2.9B on repurchases and tax on employee stock, and the share count went from 893M to 901M C (calculated).⁴⁶³ The 2025 founder vesting explains much of that. It also means the buyback has so far mopped up stock pay instead of shrinking the company. With founder awards done, that may now change: diluted shares were 911M in the third quarter, down from 918M.² Over its whole life the company still has an accumulated deficit of $773M.²

Good buyer of its own stock when it was cheap. Well paid on the share price. Founders in control, selling slowly. The next pay award matters more than the last one.

VFinancials

The record

The audited record starts in 2019. The IPO prospectus gives two years, and no revenue line for 2018, so I show seven years and the trailing twelve months rather than ten.⁸

Three things stand out. Revenue fell 25% in 2022 when retail trading cooled, with ARPU down from $103 to $60, and that was the most recent real test.⁶ The business needed three loss-making public years before it earned anything: net losses of $3.69B, $1.03B and $0.54B, much of it stock pay. And since 2022 revenue has risen 3.7 times while costs rose 17%, so nearly every new dollar has reached profit C (calculated).

The last few quarters are less tidy. In the third quarter revenue rose 12%, costs rose 16%, adjusted EBITDA rose 9% and diluted EPS fell 16% to $0.51, though that includes $67M of losses on Robinhood Ventures funds.² Growth has slowed from 2025’s 52% to a mid-teens pace. The company also began reporting Adjusted Net Income this quarter, and revised it a day later through an 8-K/A, from $550M to $542M, for tax on the adjustments. GAAP numbers did not change.²

What an owner can really take out

For most companies I start from operating cash flow. Here it is useless. It was −$885M in 2021, −$157M in 2024 and +$3.98B in the first nine months of 2026, because it is swamped by customer balances: margin loans, securities lent and cash the firm holds for clients.⁹³ None of that belongs to an owner. So I build owner cash up from the income statement.

So the distance from the headline to what an owner gets is large. Adjusted EBITDA of $2.84B is not available to anyone. An owner who wanted the business to stay the same size could take about $1.57B out in a year, and one who wants it to keep growing gets about $1.06B E (estimate). Set against the $77.7B market value, that is a 2.0% yield today. Everything else in the price is growth.

The balance sheet

Total assets were $58.3B, almost all of it customer business. Equity was $10.1B.² Corporate cash was $5.83B, plus $164M of stablecoin, against the $2.2B zero-coupon convertible and $0.46B of card-backed notes.³ Robinhood Securities had net capital of $4.2B against a required $491M.³ A broker’s cash is never all free. Clearinghouses can raise deposits sharply on a single volatile day, as the 10-K warns and as early 2021 showed.⁷ It has a $3.25B secured credit line for that purpose, which renews every 364 days.¹³ Return on average equity was about 21% C (calculated), flattered by the low tax rate.

VIValuation

First, how this goes badly wrong

Before any numbers, I asked what would most likely ruin this investment, and worked back from there. Three things could.

1. Retail stops taking risk. This is the old danger and the largest. In 2022 revenue fell 25% and ARPU fell 42%.⁶ The revenue lines now are bigger and the product list longer, but options, crypto, equities, event contracts and margin all need the same confident customer. Crypto has already shown the speed of it: down 55% in a year.³
2. The law takes away a product. Sports contracts are about 70% of a line that is 12% of revenue and most of the recent growth. The Ninth Circuit ruled against Robinhood in August and the Sixth against Kalshi in September. Robinhood has stopped new sports contracts in Nevada and Michigan and stops in Ohio by 2 November.³ Payment for order flow is the bigger cousin: transaction revenue is 61% of the total, and a rule change there would reach much further.
3. The price itself. Nothing has to go wrong at Robinhood for an owner to do badly. At 39 times trailing earnings the buyer has already paid for a decade of success. If the company does what I expect, the return is about 7% a year.

All three have happened to this company or its near peers. The first sets my bear case. The second is in it. The third is what the rest of this section measures. One thing sits outside the model: a failure at a clearing broker holding customer money is the event that ends firms of this kind, and I can’t price it.

What the price implies

At $84.99 the market values Robinhood at about $77.7B on 914M diluted shares: 900.5M outstanding on 21 October, about 6.0M from warrants at $26.60 and 7.4M of unvested stock C (calculated).¹³ I treat the convertible as debt, since it converts at $174.42. That is 39.2 times trailing earnings, 28.0 times the Nasdaq 2027 consensus of $3.03 and 22.5 times the 2028 mean of $3.78, and 7.8 times book C (calculated).²⁵ The stock closed down 7.2% on 30 October; I found nothing in the filings that explains that one day.¹

Schwab, the firm Robinhood hopes to resemble one day, sells at 11 times 2027 earnings. Robinhood’s premium pays for the growth, and it is the thing being tested on this page.²⁶

Now the reverse DCF. I start from the $1.57B of stand-still owner cash and ask what steady growth for 15 years justifies the price, at a 12.0% rate and 3.0% after that. The answer is 18.0% a year, to $18.7B in 2041 C (calculated). My base gets there at about 12.6% and my bull at about 18.7% E (estimate). So the price sits close to my bull case, and it has fallen 44% from its high to get there.

Put in plain terms, the price needs revenue of about $32.0B by 2036, about 10% more than Schwab’s annualized revenue today, on platform assets of about $3.1T at a 55% margin E (estimate). On the first two years it asks little that Wall Street doesn’t already expect: my implied path has EPS of $2.90 in 2027 and $3.80 in 2028, against consensus of $3.03 and $3.78. The hard part comes later, because it has to keep going for a decade after that.²⁵

What I can’t judge

Three inputs drive this and I can’t know any of them. I don’t know where revenue per $100 of assets settles. I don’t know how the Supreme Court, Congress or the CFTC will settle sports contracts. And I don’t know whether a phone-native customer stays at 50. So here is the range, one at a time, against my $50.

The surprise in that table is the last line. If event contracts vanished tomorrow, my base falls only $7. The legal fight will move the stock far more than it moves the value, because the market is paying for that line as a growth story. The larger exposure is the slow one: what each dollar of assets earns over ten years.

The discount rate

I use 12.0%. The capital asset pricing model starts with the 4.94% ten-year Treasury yield and Damodaran’s 4.20% implied equity risk premium of 1 October.²²²³ Robinhood’s beta on month-end returns since the IPO is 2.36 and its three-year beta 3.62, against the S&P 500, which gives 14.9% and 20.1% C (calculated).¹²⁴ Those betas come from a period that includes the 2022 collapse and two years of losses. I take 12.0%, a beta of about 1.7, the same rate as my Micron page, which is the other stock on this site with earnings tied so closely to a cycle.³⁵ The downturn is already in my bear case, so I don’t add for it twice. Readers who trust the measured beta can use the bottom row.

The price is $84.99. Even at the 9.5% I use for American Express and 4.0% growth forever, my base cash flows reach $84 and no more. So the gap to the price is about the cash flows, not about the rate.³²

Three cases

I keep the model simple. Platform assets grow by net deposits and a market return. Core revenue is a rate on those assets, falling over time. Event contracts are a separate line. I apply a pretax margin and 24% tax. From that I take deposit match spending and $0.70 to $1.00 of retained capital per $100 of added assets, and what’s left is distributable. It runs 15 years, the same form as my American Express page, then 3.0%. I add $2.1B of excess cash and take the interest on that cash out of earnings so it isn’t counted twice. Stock pay is a cost, so I hold the share count flat at 914M.³²

My 2027 and 2028 earnings of $2.61 and $3.17 sit 14% and 16% under the Nasdaq means of $3.03 and $3.78; my bull is $3.00 and $4.03, about at them. Part of the gap is tax, since I use 24%, and part is that I don’t assume event contracts keep growing at this rate while more states close. The basis of the consensus isn’t stated.²⁵

Is my base too low? It has revenue growing about 15% a year for a decade, more than four times today’s level, and assets six times today’s. That isn’t a cautious case for the business. The value comes out at $50 because a 12% return is a high bar and because I end up treating Robinhood in 2041 as a firm much like Schwab today, which earns 11 times earnings at this moment.²⁶

Multiply the odds

Here is the case for the price in one line of arithmetic. It needs deposits to run ahead of my base for years, revenue per dollar of assets to fall more slowly, event contracts to survive and keep growing, and margin to reach the mid-50s. If I give those odds of 50%, 40%, 60% and 50%, the product is 6% E (estimate). They aren’t independent, as a long bull market would help all four, so call it one in six or seven. Those odds are my judgement and nothing more. The point is the shape: a case that needs four things at once is less likely than each of them feels.

Other uses of the same dollar

The ten-year Treasury pays 4.94%. My base here returns 6.9% a year, so about two points over bonds for a stock whose bear case is −5.2% a year E (estimate). The closest comparable on this site is American Express, another firm that lives on affluent-minded consumers and loyalty: at its price its base value is level with the price at a 9.5% rate, and its bear value is 42% below the price, where Robinhood’s is 84% below.³² Mastercard returns 8.4% on my base.³³ Those pages use their own prices and rates. Outside this site, Schwab sells at 11 times 2027 earnings, a mature version of the same business.²⁶ On my numbers, several pages here show a higher base return with a smaller bear. Robinhood’s return passes theirs only if the bull case comes close.

Quality and price

These are two questions. The business has got much better: profitable, more varied, cheap to run, and growing deposits at three times the rate of the leader. I would put it well above where I’d have put it in 2022. The price is a separate matter. Today it looks like a good business at a price that already expects it to become a great one. The stock has fallen 44% from its high and the gap to my base is still 70%.

The margin of safety

• Price$84.99Close, Q4 2026 [1]
• Base value$50My estimate E (estimate)
• Margin of safety below$3530% under base C (calculated)

I set it 30% under my base value. The discount is for what the model doesn’t hold: a clearing crisis, a rule change on order flow, and my own error about the yield. At $35 my base returns about 16% a year and my bear about 2% E (estimate). That is 11.5 times 2027 consensus earnings, roughly what the market pays for Schwab today. The stock last closed below $35 on 8 April 2025, at $34.17, so this has been available in living memory.¹ The price sits 143% above it, and there is no margin of safety at $84.99.

Where this could be in 5 and 10 years

Each value is my model’s worth at that date: the present value, at 12.0%, of the distributable cash after it, per today’s 914M shares and in that year’s dollars. It leaves out the $2.1B of excess cash. Owner cash is what the model pays out from 2027 to 2036. The return starts at the price less $2.29 of that excess cash, adds the cash paid, and ends at my value.

The base holds at five years if assets reach $1.13T by 2031 and revenue $12.2B at a 51% margin, with revenue per $100 of assets down from $1.24 to $1.03. It holds at ten if assets reach $2.4T and revenue $21.8B, with that rate at $0.88. The value rises from $50 to $71 to $95 only because the date moves closer to the cash. The company pays out $35 of it on the way.

The bear has markets down 25% in 2027, deposits of 9% falling to 5% of assets, and a margin that settles at 42%. Revenue stays near $5B in 2031. The bull has deposits above 20% of assets for two years, the revenue rate falling only to $1.00, a 57% margin and revenue of $17.3B in 2031 and $36.0B in 2036.

The most likely way my base is wrong is the revenue per $100 of assets. If it runs 10% lower, the 2036 value is $83, not $95, and the ten-year return falls from 5.2% to 3.5%. If deposits run 30% lower, it is $73.

These are estimates of value, not forecasts of the share price. The market price can sit above or below value for years.

VIIThe case for the price

What most people miss

• A director’s fund bought at about this price. Bullfrog Capital, linked to Meyer Malka, bought 680,000 shares between 28 May and 5 June 2026 at $80 to $83, about $55M.²⁰ Most insider headlines are about selling. Malka disclaims ownership beyond his financial interest and has a forward sale contract on 1,000,000 other shares, so I read it as a signal, not proof.¹⁰
• Stakes that aren’t in the numbers. Robinhood may earn up to 10% of Crypto.com for routing volume, and it controls Rothera with Susquehanna.³ My model gives neither any value beyond its revenue.
• The cost line has barely moved. Since 2022 revenue is up 3.7 times and operating costs 17% C (calculated). The 2026 outlook for adjusted costs and stock pay was cut at the top end to $2.75B, with $100M going into Trump Accounts.²¹⁹

The bull case

Management makes it best. Assets are near $400B, and Tenev expects $500B before long and trillions in time. Deposits have passed the 20% target for 2026. He says more than half the business should one day sit outside the US. The stated aim is earnings and free cash flow per share.¹⁹ The record backs part of it: funded customers up from 12.5M in 2020 to 28.7M, and ARPU up from $60 in 2022 to $200.⁵²

Investors speak mostly through filings here. At 30 June ARK held 5.24M shares, down from 6.0M in March. Altimeter held 899,691, unchanged. Tiger Global held none, from 400,000.²⁹³⁰³¹ Third-quarter 13Fs are due in mid-November. I found no named investor’s published argument on this company that I could verify, so I attribute none. The Street’s 2027 consensus is $3.03, up 41% on 2026.²⁵

Against reality

If deposits run near $93B to $109B a year, revenue per $100 of assets stays near $1.45, event contracts reach about $1.4B in 2028 and margin passes 52%, the price is possible. That is the path between my base and bull that gives $84.99 E (estimate).

Today deposits are $71.0B, part of it government and donor money. Revenue per $100 was $1.49 in the third quarter, so that test is passed for now, though the trend is down. Event contracts run at about $700M a year. Margin was 48% in the third quarter and 44% for nine months C (calculated).² The first two years are close, and the Street expects them. What can’t be seen is 2030 to 2036, when the price needs revenue growing near 20% a year from a base near $13B.

What a 10x would take. Ten times $84.99 is about $850, or $777B on today’s shares C (calculated). At 25 times earnings that needs about $31B of net income, 2.7 times Schwab’s annualized $11.6B. At a 40% net margin that is $78B of revenue, 15 times today’s C (calculated).²⁷ At Interactive Brokers’ $0.79 per $100, that is about $10T of assets, 25 times today’s. It means 26% a year for ten years. Micron rose more than 13 times from about $70B since April 2025, on a memory price spike.³⁵ NVIDIA did about five times from $1T.³⁴ My bull gives $17 of earnings in 2036, or $425 at 25 times, five times today. A tenfold gain in ten years takes twice my bull case. I call that close to impossible.

What they have to hit

Six numbers, each published on a schedule. The thresholds are the path the price needs.

Where I come down

The cost record and the deposits moved me. The event-contract story moved me less, since the whole line is worth only about $7 of my $50. Two more years of revenue per $100 near $1.45, without help from one hot product, would raise my values.

VIIIRisks, and what would change my view

The risks that matter

The court fight, plainly

Robinhood’s event contracts sit under the CFTC. States say sports contracts are gambling that needs a state licence. Robinhood says federal law overrides them. Courts are splitting. In August the Ninth Circuit affirmed the refusal of an injunction in Nevada. In September the Sixth Circuit affirmed a loss for Kalshi in Ohio and reversed a win in Tennessee. Robinhood stopped new sports contracts in Nevada in December 2025 and in Michigan in September 2026, and will stop in Ohio by 2 November. Wisconsin sued in April. The CFTC itself is suing several states on the companies’ side.³ This is headed for the Supreme Court or for Congress. I can’t call it and I won’t pretend to.

What would change my view

Up:

• Revenue per $100 staying near $1.45 for two years with no help from one hot product.
• Organic deposits disclosed, and still above 15% once Trump Accounts are taken out.
• A clear federal win on event contracts, with state taxes that don’t bite.
• A new pay plan for Tenev built on per-share value over many years.

Down:

• ARPU falling while assets rise, which would say the new money is low-value.
• A rule change on order flow, or a fall in options revenue per contract below $0.40.
• Card losses rising faster than the book.
• A large acquisition paid in stock near this price, or a large pay award with easy hurdles.