Crypto trading was not the main earner at Robinhood or Galaxy in the third quarter

Two US-listed companies that built their businesses around crypto reported third-quarter results on October 27, and in both the largest profit lines came from somewhere other than crypto trading. Robinhood's results show event contracts out-earning cryptocurrencies, and Galaxy's results show investments and data centers supplying most of its adjusted gross profit.

What happened

Robinhood Markets said transaction-based revenues increased 19% from a year earlier to $867 million, "primarily driven by event contracts revenue of $173 million," partly offset by "cryptocurrencies revenue of $120 million, down 55%." Event contracts are the instruments traded in its prediction markets hub. On Robinhood's figures, event contracts made up 20.0% of transaction-based revenues and crypto 13.8% (both computed), a difference of $53 million (computed).

Robinhood also reported that "Crypto Notional Trading Volumes decreased 38% year-over-year to $50 billion," with the Robinhood app down 48% to $21 billion and Bitstamp down 28% to $29 billion. Over the same period "Event Contracts Traded increased over 7x year-over-year to a record 16.4 billion." The release does not say why customers moved between the two, and this article does not draw that conclusion.

Galaxy Digital reported "Q3 2026 net income of $323 million and diluted and adjusted EPS of $0.66 and $0.83." Its second-quarter result was a net loss of $85 million, so net income swung by $408 million between the two quarters (computed). Adjusted gross profit, a non-GAAP measure, was $569 million, against $43 million in the second quarter.

Where Galaxy's profit came from

Galaxy reports three segments. Its Treasury & Corporate segment, which holds the company's own investments, had adjusted gross profit of $419 million after a loss of $42 million in the second quarter. Data Centers had $79 million, up from $20 million, and Digital Assets had $71 million, up from $66 million.

As shares of the $569 million total, Treasury & Corporate was 73.6%, Data Centers 13.9% and Digital Assets 12.5% (all computed). Digital Assets adjusted gross profit rose 7.6% from the second quarter (computed), while the segment that holds Galaxy's investments produced most of the quarter's increase. Within the Digital Assets segment, the release reports that the "average loan book size of $1.8 billion was up 27% compared to the prior quarter, driven by demand for the Galaxy Onchain Financing Rate."

Chief executive Mike Novogratz said Galaxy's quarter reflected "the strength of our established Digital Assets franchise, significant appreciation across our investments portfolio, and the growing contribution from our Data Centers business." The release says Galaxy's "digital asset trading volumes grew 12% quarter-over-quarter, outperforming the broader spot market, where volumes declined," citing The Block for the industry figure.

The Data Centers jump reflects "the first full quarter of revenue-generating operations under the Helios I, Phase I lease," according to the release. Galaxy also "completed a $3.5 billion offering of senior secured notes to fund construction of Helios I, Phase II," and reported total equity of $3.0 billion and cash, stablecoins and US Treasuries of $4.9 billion.

The background

The two quarters sit inside a market that had been falling. FinanceInTime reported that crypto had slid 6.7% from September's high as stablecoin supply stalled. Robinhood said its platform assets rose 19% from a year earlier to $396 billion, "primarily driven by continued Net Deposits and higher equity valuations, partially offset by lower cryptocurrency valuations."

The comparison between the two companies has limits. Robinhood's crypto figures are year-over-year, while Galaxy's segment figures are quarter-over-quarter, and the two companies report different measures: Robinhood reports revenue by product and Galaxy reports adjusted gross profit by segment, which is a non-GAAP measure. A revenue line and a gross profit line cannot be compared directly.

Other uses of capital

Both companies also spent on their own shares. Galaxy's board approved another $200 million repurchase authorization, and the company repurchased 9.8 million shares in the year to date, "more than offsetting equity-based compensation dilution." Strategy Inc said in its October 26 filing that it did not purchase or sell any bitcoin from October 19 to October 25 and used $204.9 million of cash to repurchase its STRC preferred stock. FinanceInTime covered the Strategy filing when it was published. The three companies are in different businesses, and the filings do not give a common reason for these choices.

What the numbers do and do not show

The figures show that, in the quarter, crypto trading was not the largest source of revenue growth at Robinhood or of profit at Galaxy. Robinhood's crypto revenue fell while another product line grew, and Galaxy's reported profit rose mainly where the company's investments appreciated. The data does not show how much of Galaxy's investment gain came from digital assets rather than from other holdings, because the release's figures cited here are not broken down that way.

The data also does not show whether the pattern will last. Prediction-market volumes, investment valuations and data-center leases each depend on conditions that differ from crypto trading, and both companies' reports describe a single quarter.

What to watch

Galaxy said it continues discussions with prospective tenants for the 830 megawatts of approved capacity at Helios II that are not yet under lease. Robinhood said it is launching crypto trading in the UK and has received authorization from the Dubai Financial Services Authority to launch in the region, covering trading and custody across the asset classes the regulator approved. Each company's next quarterly report will show whether the same lines moved in the same direction: event contracts and crypto at Robinhood, and the three segments at Galaxy.