Author: Prathik Desai

Translator:Block unicorn

A few weeks ago, I referred to Robinhood as a financial supermarket because it can meet all financial needs of Americans on a single platform. In the article "Building a Financial Supermarket," I wrote that as long as Robinhood can connect its dozen or so firms and cross-sell various products to over 28 million registered users, the newly launched chain platform itself does not need to be profitable.

I still believe this argument is correct in direction, but lacking in force.

This morning, I was on the other side of the globe watching Robinhood's second-quarter earnings call. After the call, I felt that the concept of "financial supermarket" undervalued the company's future development potential. The prosperity of a supermarket lies in attracting more customers into the store. Robinhood's second-quarter results indicate that it has thrived because it gets those users who originally bought Product A through the Robinhood app to buy more A products, more frequently, and gradually develop an interest in products B, C, and D on Robinhood.

Because the company can do this, it has developed rapidly lately without even attracting more people to walk through its doors for the first time.

In today's article, I will introduce the operational mechanism behind the Robinhood supermarket, which over time converts each customer into a denser revenue node, and why the two least profitable businesses Robinhood launched (or will launch) this year—its chain and social dynamics—may become the most important parts of it.

Metrics

Robinhood has only been public for five years, and its app has been online for just eleven years, yet it has surpassed the $5 billion annual revenue mark. In contrast, brokerage giant Charles Schwab took nearly 30 years since its founding in 1971 to reach $5 billion in annual revenue. One of the biggest drivers of Robinhood's revenue growth is its large user base—having 30 million funded accounts. Its product range is extensive, covering everything from crypto trading to gold and retirement accounts, catering to users of all ages. For most businesses, these metrics reflect strong user coverage. However, Robinhood is reluctant to measure its growth using these metrics.

Early in the earnings call, Robinhood’s CFO Shiv Verma told investors to evaluate the company based on three metrics: net deposits, the 40 rule, and the number of business lines achieving an annual recurring revenue (ARR) of $100 million or more.

As of the second quarter of 2026, Robinhood's desktop trading and analytics platform Legend and credit card business became the latest additions to the $100 million ARR club. Currently, the company has 13 business lines listed on that list.

But let’s put these metrics aside for now and look at more detailed content.

As of the end of the second quarter of 2026, Robinhood's paying users increased by 7% year-on-year, from 26.5 million to 28.4 million. During the same period, average revenue per user (ARPU) grew by 24%, from $151 to $187.

The revenue growth rate per customer is more than three times the growth rate of the customer base.

Trading data also reflects this. Robinhood's second-quarter data shows that the notional trading volume per customer increased by 56% year-on-year, and options contract trading volume grew by 43% year-on-year. However, the number of customers conducting stock trades only grew by 13%, and the number of options trading customers only grew by 3%.

Robinhood's active contracts business, which did not exist 15 months ago, has now achieved $156 million in revenue, growing by 50% quarter-on-quarter. And all this without having to attract new user groups.

In May of this year, I wrote about Robinhood's capability to bundle stock, options, and perpetual fund trading with event contracts, allowing it to provide a better information pricing platform than its competitors.

All of this indicates that the accurate standard for evaluating a company like Robinhood is to assess how much sales per order have grown in this financial supermarket, which is the growth of its average revenue per user (ARPU).

Gold Ignition

Despite having more than a dozen businesses under its umbrella, one of the key drivers of its growth engine is the Gold member subscription service. Over the past two years, the adoption rate of Robinhood Gold membership has nearly doubled, increasing from 8.2% of total paying users to 17%.

In the second quarter of 2026, Robinhood's Gold membership subscription generated annual subscription revenue of $216 million, accounting for only about 4% of total revenue. However, the benefits each Gold member brings to the company’s overall business are far greater. Compared to regular customers, Gold members' managed assets are about 4.2 times larger, and their retirement product purchase rate is about 3.1 times greater.

During the earnings call, CFO Verma noted that 40% to 50% of new customers registered for Gold membership, regardless of which product they initially entered the company through.

This showcases Robinhood's strong cross-selling moat. Even if customers initially came for commission-free stock trading, World Cup prediction markets, or 3% cashback credit cards, half of them ultimately upgrade to Gold membership. Once they purchase the $5 monthly membership service, they gain access to an exclusive community of 4.8 million members, enjoying lower-priced options contracts, employer-provided 3% IRA matching contributions, a 3.5% annual interest rate on bank deposits, credit cards, and many other benefits.

This cross-adoption is measurable. Verma noted that users of the prediction market are more likely to simultaneously open retirement accounts at Robinhood. Therefore, individuals betting on football matches through Robinhood's prediction market are also using Robinhood's retirement accounts to increase their individual retirement account (IRA) gains.

Robinhood's financial product supermarket does not segment customers into "gamblers" and "serious investors." It sells products to the same customer, and each product they use increases the likelihood of using other products.

Despite Robinhood having such a strong distribution moat, I feel that its most exciting moves are yet to come.

Two Catalysts

In the article "Building a Financial Supermarket," I discussed how Robinhood Chain is nearly unprofitable and does not need to be profitable. At that time, I positioned Robinhood Chain as a connective layer intended to enhance user stickiness for other businesses. After watching the second quarter earnings report, I made slight adjustments to my outlook for Robinhood’s future. Its Chain Chain and the soon-to-launch Robinhood Social will become two major catalysts that cut across Robinhood's entire product line and drive cross-selling for its dozen or so businesses.

Think about what this chain can bring. Customers purchase tokenized stocks. The token becomes collateral in the lending market. Loans are used to purchase perpetual futures positions. Now, with just one dollar, multiple products can be utilized in a single transaction without leaving the app. In the previously fragmented brokerage ecosystem, these three operations happened on three disconnected platforms. Each platform had its own cumbersome registration process and required customers to make decisions anew. Composability eliminates these frictions.

The chain integrates cross-selling into the infrastructure so that customers can cross-purchase with minimal or zero friction.

Robinhood CEO Vlad Tenev announced that the company plans to open its social feed to all users by the end of the third quarter. Tenev expects this internal feed will support trading ideas through verified portfolios on the Robinhood trading platform, thereby enhancing their credibility. Currently, trading ideas often come from various channels. Traders might obtain potential trade information from Twitter, podcasts, or friends. Customers subsequently form trading intentions, eventually entering the Robinhood platform to execute trades. Robinhood Social is expected to streamline this process internally.

This is the most underrated aspect of its social dynamics. The trust it can bring to its 30 million funded users is unmatched by any external platform's screenshots or podcasts. When this dynamic opens to the public, Robinhood will internalize the last stage of its users' trading intention conversion process that relies on external resources.

I do not believe Robinhood Chain and Social are independent business lines for the company. On the contrary, I see them as catalysts propelling the development of all other company businesses. A community of 30 million users discussing the latest active contracts, how they build a disciplined lifestyle through their retirement accounts, and the latest stock tokens (giving them the opportunity to invest before the Anthropic IPO) create a dynamic that is more effective in sparking the desire of other users than any user acquisition marketing campaign.

Customer Loyalty Strategy Handbook

Robinhood's value acquisition strategy is similar to what we have seen with Costco. Most of the profits of the third-largest retailer in the U.S. come from membership fees, while the prices of shelf goods are close to cost to entice members into the store. Profits do not exist in the neutral layer. But these neutral layers often create adjacent value accumulation spaces. Just as Costco’s shelf displays and inventory management encourage people to purchase its subscription service.

Robinhood Chain and Social are akin to these neutral layers that create value accumulation tiers. They provide reasons for investors or traders to choose the Robinhood Gold membership service and select from various products in the financial supermarket.

Over the years, one of the biggest questions facing Robinhood has been cyclical issues. Despite Robinhood achieving record highs in stock and options trading volume in the second quarter, its cryptocurrency trading volume has declined for three consecutive quarters. Even on Robinhood Chain, over 80% of the trading volume is still influenced by meme coin speculation.

Skeptics may feel that this is problematic. But I disagree.

Robinhood's diversified and strong business lines (with an annual recurring revenue of $100 million) ensure that its merged business is no longer affected by market cycles. Even if trading volumes decline, interest-bearing assets may not necessarily decrease. Its margin accounts grew by 127% year-on-year to $21.6 billion.

On a platform like Robinhood, the prediction market, which used to be mainly driven by sports events and elections, takes on a different form. Robinhood and Susquehanna International Group's joint venture Rothera received a trading license for prediction markets regulated by the Commodity Futures Trading Commission (CFTC), allowing it to create its own event contracts. This enables the company to eliminate cyclical fluctuations from seasonal categories such as sports events and elections and provide year-round event contracts linked to macroeconomic announcements and the S&P 500 index.

Gold membership subscription revenue is a fixed monthly income, unaffected by monthly market performance. It took Robinhood five years to integrate multiple businesses that peak at different times of revenue, making the entire company less susceptible to cyclical impacts than any single business line.

This is reflected in average revenue per user (ARPU). ARPU grew by 24% because regular customers now access more businesses simultaneously, and a customer linked to five unrelated sources of income has far greater asset stability than one linked to a single, volatile source of income.

The more products each user engages with, the more stable Robinhood's own revenue curve becomes. A dip in one business line can be filled by a peak in another, and these peaks often come from the same user’s account.

Coinbase redistributed existing crypto capital among consumers and institutions. Traditional brokerages hold assets but cannot generate user interactions. Robinhood's unique advantage lies in its ability to transform a single customer relationship into a compound growth, self-diversifying revenue node that spans traditional and crypto businesses, both of which can be connected and amplified through its native blockchain.