How solid is Robinhood’s trading rebound?

  • Bernstein expects Robinhood to report third-quarter revenue of approximately 1.5 billion dollars, up 13% quarter over quarter, and adjusted EBITDA of approximately 819 million dollars. Active equity and options trading, together with a rebound in event contracts and crypto trading, drove transaction revenue growth.
  • Quarterly crypto trading volume is expected to be approximately 50 billion dollars, up 22% quarter over quarter but still approximately 38% below the same period in 2025; the recovery has yet to recoup the earlier decline. Event contract trading volume is expected to reach 16.4 billion contracts, up 21% quarter over quarter.
  • The firm expects prediction market revenue to rise from approximately 650 million dollars in 2026 to 1.7 billion dollars in 2028. Key assumptions include expanding industry trading volume and Robinhood’s share remaining stable at approximately 15%. Access to the company’s own exchange, Rothera, and other trading venues will expand the range of tradable contracts.

Why were Coinbase forecasts cut sharply?

  • Bernstein expects Coinbase to report third-quarter revenue of approximately 1.3 billion dollars, up 4% quarter over quarter, and spot trading volume of approximately 150 billion dollars, flat quarter over quarter. An increase in the average USDC balance on the platform is expected to lift stablecoin revenue, but the revenue-sharing arrangement with Hyperliquid may limit its contribution to net income.
  • After falling 20% quarter over quarter in the second quarter, industry spot trading volume fell another approximately 8% in the third quarter. Weak trading prompted the firm to cut its 2026 revenue forecast for Coinbase by 32% and its adjusted EBITDA forecast by 63% to approximately 1.3 billion dollars; its 2026 earnings-per-share forecast fell from 5.97 dollars to a loss of 2.60 dollars.
  • The firm expects revenue from perpetual contracts, derivatives and prediction markets to rise from less than 600 million dollars in 2026 to approximately 2 billion dollars in 2028, but Coinbase earns only distribution revenue from selling Kalshi contracts. Bernstein maintained its outperform rating and cut its price target from 330 dollars to 250 dollars.

Why is Circle’s profit improving as USDC supply declines?

  • Average USDC in circulation fell from approximately 77 billion dollars in the second quarter to approximately 73 billion dollars in the third quarter. Bernstein expects reserve income to decline accordingly, from 668 million dollars to 650 million dollars.
  • At the same time, recognition of ARC token presale revenue is expected to drive third-quarter total revenue up 10% quarter over quarter to approximately 770 million dollars, and adjusted EBITDA up 36% to approximately 190 million dollars. The firm expects most of this revenue to flow through to revenue after distribution costs and adjusted EBITDA.
  • Bernstein raised its Circle price target from 140 dollars to 145 dollars, citing increased other revenue and an improved outlook for reserve yields. Higher interest rates benefit reserve yields, but also increase the opportunity cost of holding non-interest-bearing USDC, potentially slowing its growth.

Why is Figure’s loan growth accompanied by lower fee rates?

  • Figure has disclosed third-quarter loan volume of 5.1 billion dollars, up 20% quarter over quarter and 107% year over year. Bernstein expects adjusted net revenue of 253 million dollars and EBITDA of 130 million dollars, up 16% and 9% quarter over quarter, respectively.
  • More loans were completed through the lower-fee Connect platform, and the share of first-lien mortgages increased, putting pressure on the blended fee rate. The fee rate fell approximately 20 basis points quarter over quarter to 3.6% in the second quarter; the firm expects it to be at the low end of management’s 3.5%–4% guidance thereafter.
  • Bernstein expects high-margin platform fees to offset the impact of the decline in fee rates, raising the EBITDA margin from an estimated 53% in 2026 to 61% in 2028. The company will consolidate Kiavi for the first time in the third quarter, while the firm’s earnings model above does not yet include the acquisition.