Bernstein analysts expect prediction markets to emerge as a key incremental earnings driver for retail trading platform Robinhood Markets (HOOD), with the segment potentially overtaking the company's crypto-derived revenue.

In a forecast shared with Cointelegraph on Monday, the analysts projected that prediction markets could generate up to $1.7 billion in business for Robinhood by 2028, exceeding the $1.6 billion in crypto-based revenue they expect the platform to derive that year. Prediction markets let traders buy and sell event contracts tied to the outcomes of real-world events such as elections, economic data releases and sports results — a category that drew broad retail attention around the 2024 U.S. election cycle and that Robinhood now offers alongside its stocks, options and crypto trading.

Robinhood's prediction market revenue is forecast to climb to $1.7 billion in 2028 from roughly $650 million this year, representing approximately 18% of the firm's projected $9.4 billion in total 2028 revenue. If realized, the projection would make prediction markets, rather than crypto, the larger of the two revenue contributors — a notable shift in the mix for a platform best known for commission-free stock and options trading.

The forecast arrived one day ahead of Robinhood's third-quarter 2026 earnings report and underscores the growing role of prediction markets as a revenue source for the retail-focused trading platform. The timing also sets up a near-term checkpoint: the report will show whether event contract volumes and crypto trading activity are tracking with the assumptions behind Bernstein's raised estimates.

For the third quarter, Bernstein expects revenue to rise 13% quarter-over-quarter to approximately $1.5 billion, driven by growth in equity notional volumes, options volumes and event contract volumes, along with a recovery in crypto trading activity. Listing event contracts among the quarter's growth drivers indicates the prediction market business is already contributing to results, not just to the 2028 projection.

The brokerage raised its Robinhood revenue estimates by 3% for 2026, 4% for 2027 and 3% for 2028, citing higher equities and crypto revenue assumptions, while leaving its $160 price target unchanged.

Despite the raised estimates, Nasdaq-listed HOOD shares were set to open lower on Monday, with premarket activity paring the stock price down to $93.60, according to Yahoo Finance. HOOD stock is down more than 29% over the past 12 months.