Robinhood's 175% rally this year is best among U.S. tech stocks

CNBC

4 days ago

As Robinhood investors await second-quarter earnings, expectations are sky-high.
The online broker, known for popularizing stock and crypto trading with young investors, has seen its shares surge 177% this year, outpacing all other U.S. tech companies valued at $5 or more, excluding those that went public in 2025. The next best performer is Palantir, up 107%.
Robinhood's pop this year follows a 192% rally in 2024. The company's market cap now sits at $91 billion, putting it slightly behind Coinbase, one of its top rivals in the market for buying crypto.
Still, Robinhood was left out of the S&P 500 in the latest reshuffle, while Coinbase made the cut in May. Earlier this month, monitoring software company Datadog was added to the benchmark index as part of its quarterly change. Shortly thereafter, online ad company The Trade Desk and fintech firm Block joined the S&P 500, replacing companies that were getting acquired.
The index's three newest companies are each worth tens of billions of dollars less than Robinhood.
Robinhood has another shot to show that it's deserving when it reports quarterly earnings after the bell on Wednesday. Analysts expect the company to report revenue growth of 33% from a year earlier to $908 million, according to LSEG, with projected earnings per share of 31 cents.
Adjusted earnings are expected to come in at about $448 million, according to StreetAccount.
The rally reflects Robinhood's transformation from a U.S. retail broker into a global fintech and crypto infrastructure platform.
While U.S. fintech funding fell 42% in the first half of 2025, according to Tracxn's semiannual report, dealmaking accelerated, and Robinhood stands out as one of the most notable buyers.
In June, Robinhood acquired Bitstamp for about $200 million, gaining institutional trading rails, custody services, and more than 50 active licenses. In May, it agreed to buy Canadian crypto platform WonderFi for $179 million, expanding its regulatory footprint across North America.
Robinhood is finding significant traction in Europe, where the company has begun rolling out tokenized stocks and exchange-traded funds, including synthetic shares of OpenAI and SpaceX, using blockchain.
The token launch this month came alongside a broader crypto push announced at Robinhood's Cannes summit, where the company also disclosed plans for its own layer-2 blockchain optimized for real-world asset settlement. It also announced 24/7 trading and staking for Ethereum and Solana for its U.S. customers, a feature that allows users to earn rewards by supporting network operations.
Other enhancements allow users to tap more leverage for crypto investments and use tools that help minimize capital gains payments and get more advanced charting.
Analysts at Mizuho raised their price target on the stock to $99 following the launch in France, citing the company's "unmatched product velocity" and availability in more than 30 countries in Europe.
There are potential regulatory hurdles to some of Robinhood's efforts. Regarding the tokenized trading, the Bank of Lithuania, Robinhood's lead regulator in the European Union, said it's "awaiting clarifications" on the product. But in the U.S., SEC Chair Paul Atkins called the model "an innovation" on CNBC's "Squawk Box."
Robinhood CEO Vlad Tenev told CNBC after the announcement that he is "happy to continue to answer questions from our regulators," and said the company built its tokenized stock program to withstand scrutiny.
"Since this is a new thing, regulators are going to want to look at it," he said. "And we expect to be scrutinized as a large, innovative player in this space."
Robinhood declined to comment for this story.
In its first-quarter earnings announcement in late April, Robinhood reported a 77% increase in transaction-based revenue to $583 million. Crypto trading revenue doubled to $252 million, options revenue rose 56% to $240 million and revenue from equities increased 44% to $56 million.
This quarter, analysts are watching how that momentum holds up.
Analysts at Cantor Fitzgerald said in a note last month that it sees Robinhood continuing to gain share from larger brokers like Charles Schwab and Interactive Brokers, as well as from crypto exchanges such as Coinbase. The firm recently lifted its price target to $89 from $60, maintaining an overweight rating on the stock.
The challenge for investors is that Robinhood has zoomed past most analysts' estimates, leaving plenty of room for disappointment. Its stock closed at $103.32 on Tuesday, down about $6 from its high on July 18. Among analysts tracked by FactSet, the average price target is $100.57.