Robinhood's Trillion-Dollar Gamble: Trump Accounts

0:00Robin Hood snagged a huge government gig three weeks back, getting picked by the Treasury as the main broker for Trump accounts. This program's dropping $1,000 into investment accounts for every kid born in the U.S., from 2025 to 2028. It sounded like a jackpot at first, but their first quarter earnings hit on April 28 and flipped the script. They revealed an extra $100 million in cost just to build and run the program's app and support. Just tanked almost 7% after hours, wiping out about $5 billion in market value. Investors are siding if onboarding around 4 million kids into finance is worth the upfront hit before real revenue kicks in. Early signs show traction, though, with over 4 million kids enrolled already and 1 million set for pilot deposits. CEO Vlad Tenev calls it a long-game move to hook the next gen of investors and prove Robin Hood's chops as a government partner. Meanwhile, core business grew solid revenue of 15% to 1.07 billion, assets at 3.7 billion,

1:05but operating cost jumped 18% too. The bets got massive scale with potential for 60 million future users, but executions key amid rising expenses and regs will it fuel lasting growth or just squeeze margin short term? That's the play investors gotta watch. From your city powered by AI, this is Durham News today, I'm Corey with the story.