Robinhood’s trading platform has benefited from investor optimism about stocks and cryptocurrencies.
In the first nine months of 2025, the company’s sales increased by 65% and its profits increased by 153%.
Robin Hood’s resilience is truly tested when a bear market occurs.
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Robin Hood Market‘ (NASDAQ:HOOD) Apps for buying and selling stocks surged in popularity a few years ago as investors were flooded with cash from stimulus checks and the market was on the cusp of starting its current run.
The company’s impressive products, coupled with investors’ appetite for risk over the past few years, have led to significant growth for the company and its stock price, up 1,300% over the past three years. But can Robinhood maintain its momentum in the coming years? Here are a few factors to consider.
Image source: Getty Images.
Research from Vanguard shows that bull markets tend to last about seven years, which is good news for investors since the current bull market began in 2022. This means that after three years of bull market S&P 500 Index Go higher, and more good times lie ahead.
If the current bull market driven by artificial intelligence stocks continues for the average time, Robinhood could benefit. The company relies on investors to buy and sell stocks (and cryptocurrencies), and the AI boom is great for business.
In the first nine months of 2025, the company’s sales increased 65% to $3.2 billion, and diluted earnings per share increased 153% to $1.39.
Robinhood has also managed to attract an expanding customer base, with the number of funded customers growing 10% in the most recent quarter to 26.8 million. These investors have been extremely profitable, with average revenue per user (ARPU) of $191, up 82% from the same period last year.
What’s more, Robinhood has benefited from the growing cryptocurrency market over the past few years as well as riskier investments through options trading. In the third quarter, Robinhood’s transaction-based revenue from options trading increased by 50% to $304 million, and revenue from cryptocurrency investments increased by more than 300% to $268 million.
If Robinhood can continue to attract customers to the platform, and if the current bull market continues for a few more years, the company has a good chance of seeing its stock price rise further.
Even though Robinhood has a good chance of continuing its growth trajectory, it’s worth noting that Robinhood’s growth relies on investors being optimistic about the market.
If investor sentiment changes and we enter a bear market, Robinhood’s sales and earnings could slow. The company is trying to diversify beyond its trading platform, offering a range of services including savings accounts, credit cards and estate planning.
But considering Robinhood went public in 2021, it has yet to experience a prolonged market downturn. Simply put, Robinhood hasn’t weathered a prolonged period of market pessimism, and as a company that relies on people buying and selling stocks (and cryptocurrencies), a bear market could cause some pain in a down market.
Robinhood needs good times to continue growing, but there’s a lot of conflicting data on the current state of the economy. Although layoffs in 2025 are at their highest level in five years, the unemployment rate remains at a relatively low 4.6%. For some time, investors have worried about rising tariffs and their potential impact on inflation, but the worst fears are yet to emerge. Meanwhile, the housing market has stalled, but consumer spending has remained relatively stable.
Robinhood’s fortunes could change if economic data starts to point in a decidedly negative direction. An economic slowdown could cause investors to abandon riskier investments and could cause others to stop buying and selling stocks as frequently as they do now. But with the economy basically doing well right now, a broad shift in investor sentiment hasn’t happened yet, and no one knows when it will.
All of this means Robinhood is poised for even more growth in the coming years. Keep in mind that Robinhood shareholders should expect some volatility if the economic clouds worsen.
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Chris Neiger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Where will Robin Hood be in three years? Originally posted by The Motley Fool
