Trading & Options · Profile from Trading and Options Research Companion
Robinhood
The Menlo Park app broker that Vlad Tenev and Baiju Bhatt founded in 2013. It launched commission-free US stock trading on phones in March 2015, added commission-free options in December 2017 (FINRA), and paid for both with payment for order flow (PFOF): wholesale market makers such as Citadel Securities and Susquehanna pay it for the right to fill customer orders. Options pay far more per trade than stocks. In 2020 PFOF and transaction rebates were 75% of Robinhood's revenue and 81% in Q1 2021, when options brought in $197m of $522m (S-1, as reported). In Q4 2025 options transaction revenue was $314m against $94m from equities, on 659m options contracts (company release, 10 Feb 2026). By Q3 2026 options revenue was $399m on a record 905m contracts (company, 27 Oct 2026). For this knowledge base Robinhood is the clearest case of a broker whose economics depend on retail options flow. It is also a case study in what that model costs when controls lag growth: the SEC's $65m order (17 Dec 2020) found inferior executions that cost customers ~$34.1m net of commission savings; FINRA's record case (30 Jun 2021: $57m fine plus ~$12.6m restitution) cited options-approval "bots"; Massachusetts' gamification case settled for $7.5m (Jan 2024); and on 28 Jan 2021 a clearing-house deposit call forced it to stop customers buying GameStop. The business as a whole (deposits, crypto, banking, valuation) is told in Finance: Robinhood; this profile takes the trading and options angle.
At a glance
- Founded
- 2013 by Vlad Tenev and Baiju Bhatt (18 Apr 2013 per a secondary summary used in section 16); iOS app with zero-commission US stock trades launched Mar 2015 (Finance KB)
- Headquarters
- Menlo Park, California
- Ownership / structure
- Public (Nasdaq: HOOD) since 29 Jul 2021 (IPO at $38, ~$2.1bn raised, ~$32bn valuation — Finance Shared facts); dual-class shares give the founders voting control; broker-dealers Robinhood Financial (introducing) and Robinhood Securities (self-clearing since 2018); Robinhood Derivatives (FCM, from the Marex FCM purchase, Mar 2024 — Wikipedia); co-owner with Susquehanna of the Rothera prediction-market exchange (ex-MIAXdx/LedgerX) (Finance KB)
- Leadership (2026)
- Vlad Tenev, CEO and chairman; Baiju Bhatt, co-founder (co-CEO to Nov 2020); Steve Quirk, chief brokerage officer (Cboe release, Oct 2024)
- Trading products
- US stocks and ETFs (incl. 24 Hour Market), equity and ETF options, index options (SPX, XSP, VIX, RUT, NDX — Robinhood support page), futures and options on futures, event contracts (prediction markets), crypto; Robinhood Legend desktop platform (Oct 2024)
- Scale (dated, company)
- Funded customers 27.0m (Q4 2025), 28.7m (Q3 2026); options contracts 659m (Q4 2025), 905m (Q3 2026, +48% y/y); event contracts 8.5bn (Q4 2025), 16.4bn (Q3 2026); margin book $16.8bn (Q4 2025), $22.1bn (Q3 2026, Finance KB)
- Revenue (dated)
- 2025: total net revenues $4,473m, transaction-based $2,628m, net interest $1,514m, net income $1,883m (release, 10 Feb 2026). Q4 2025: revenue $1.28bn; options $314m; equities $94m; crypto $221m; other transaction $147m; net income $605m. Q3 2026: revenue $1.42bn (+12%), options $399m, event contracts $173m, crypto $120m (−55%), net income $476m (company, 27 Oct 2026)
- Regulators
- SEC and FINRA (broker-dealers); CFTC and NFA (FCM, event contracts); state securities regulators (Massachusetts); state gaming regulators (sports event contracts); NYDFS (crypto)
- Signature moves (incl. failures and enforcement)
- Zero-commission app and the PFOF model (2015); commission-free options (Dec 2017); the box-spread and "infinite leverage" episodes (2019); the SEC PFOF/best-execution order (Dec 2020); outages, the Kearns case and FINRA's record fine (2020–21); Massachusetts' gamification case (2020–24); the GameStop buying restrictions (Jan 2021); the IPO and its options dependence (2021); index options, futures, Legend and the active-trader push (2023–26); prediction markets and the Rothera exchange (2024–26)
10 strategic moves analysed
Each one gets a full strategy file in the companion: context, the decision, the financing, what happened, and the lesson.
2015
Zero Commission App and PFOF Model
Founding / market-structure bet (payment for order flow)
2017
Commission Free Options Launch
New product (listed equity and ETF options)
2019
Box Spread and Infinite Leverage Episodes
Control failure and risk-limit change
2020
Massachusetts Gamification Case
Regulatory and legal action
2020
Outages Kearns and FINRA Record Fine
Control failure; regulatory and enforcement action
2020
SEC PFOF and Best Execution Order
Regulatory and enforcement action
2021
GameStop Buying Restrictions
Counterparty or clearing event; emergency capital raise
2021
IPO and Options Revenue Dependence
IPO
2024
Index Options Futures and Active Trader Push
New products and strategy pivot (toward active traders)
2024
Prediction Markets and Rothera Exchange
New market; joint venture (exchange ownership)