Robinhood (NASDAQ: HOOD) shares tumbled over 8% on February 11 after the company released its Q4 2025 earnings, but Bernstein analyst Gautam Chhugani pushed back, calling the selloff a "temporary crypto market panic." He reaffirmed a $160 price target, implying roughly 105% upside from the closing price of $77.97.
Record Revenue Marred by Crypto Decline
Q4 total revenue hit $1.28 billion, up 27% year-over-year and a quarterly record. Full-year revenue reached $4.5 billion, up 52%. Earnings per share came in at $0.66, beating the $0.62 consensus. However, revenue missed the $1.34 billion estimate, dragged down by crypto transaction revenue of just $221 million—a 38% drop from a year earlier and well below the $248 million forecast. Shares closed at $77.97, down 8.91%.
Event Contracts Surge as Crypto Lags
While crypto trading underperformed, Robinhood's event contracts business exploded. The company processed 8.5 billion contracts in Q4 and over 12 billion for the full year. CEO Vlad Tenev called event contracts "the fastest-growing business in company history," with an annualized revenue run rate exceeding $300 million. Options and equities segments also posted strong growth, making the crypto slump stand out even more.
Bernstein Stays Bullish: "Ride Out the Crypto Volatility"
In a note, Chhugani maintained an Outperform rating and $160 target. "We see no reason to turn bearish near the bottom. Ride out the crypto volatility; it's temporary," he wrote. The analyst attributed the Q4 crypto revenue miss to a short-term panic following Bitcoin's pullback from its all-time high, predicting the impact will largely hit fiscal Q1 2026 before a clear recovery in Q2. Most of the 22 analysts covering Robinhood still rate it a Strong Buy.
Robinhood Chain Testnet Goes Live
On the same day as the earnings release, Robinhood announced the public testnet launch of Robinhood Chain, an Arbitrum-based Layer 2 blockchain. The company committed $1 million to a developer ecosystem program. Positioned as a "financial-grade" Ethereum L2, the chain supports 24/7 trading and self-custody of tokenized stocks and ETFs. The testnet already features tokenized shares of Tesla, Amazon, and Palantir. Robinhood also formed a joint venture, Rothera, with Susquehanna International Group to build a CFTC-regulated exchange and clearinghouse for event contracts and tokenized assets.