Robinhood reported a 48% jump in quarterly profits on Wednesday, blowing past analyst estimates-thanks in part to the brokerage's burgeoning prediction-market business.

The brokerage's trading revenue was up 44% from the same time last year. Robinhood's crypto trading revenue has dropped for a few quarters now, a lull long enough to leave some analysts wondering if the slowdown is permanent. But trading volumes for stocks and event contracts-which allow traders to wager on everything from Fed rate hikes to the winner of the World Cup-are more than making up the difference.

The number of event contracts traded in the second quarter was more than 10 times the volume of the same period last year, the company said. Stock-trading revenue increased 95% year-over-year.

There were a few other winds at Robinhood's back this quarter:

-- The demise of a decades old day-trading rule that required especially active traders to hold $25,000 in capital.

-- A blockbuster SpaceX IPO that drove record participation from everyday investors.

-- And more broadly, a knockout quarter for financial markets, in which highflying chip stocks helped drive major U.S. indexes to their best quarter in years.

Robinhood also noted that operating expenses jumped 33% from the same period last year. That included costs tied to marketing, layoffs and the launch of Trump accounts, among other items.

The stock turned lower in afterhours trading, recently off about 4%.