Markets . 3 Aug 2022
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Crypto and stock brokerage company, Robinhood, faces a backlash after mass layoffs due to a financial crisis situation. Nearly a quarter of the staff at Robinhood was laid off following a decline in the trading volumes and fund investor activity.
The California-based company has seen a decline in its active users from 21.3 million last year to 15.9 million in March and then to 14 million in June. Robinhood also runs an app that enables clients and retail dealers to quickly trade on their phones.
Job cuts aren’t new at Robinhood. This is their second instance over the past 6 months. In April, Robinhood laid off nearly 9% of employees who were laid off for the same reason.
The last round of job cuts didn't benefit their company much and didn't go far enough, said Vlad Tenev, CEO of Robinhood, in a blog post to his employees.
He also stated that in order to improve the experience for the Robinhood company, their organization already has more employees than is necessary.
In an extended Bear Market since Terra’s Collapse in May, Robinhood incurred a $295 million loss for three consecutive months, ending in June.
The company’s revenue fell 44% YoY resulting in a negative impact on the profits of the Robinhood company.
The leading cryptocurrency, Bitcoin, is down over 33.89% from its all-time highs of $69,044 recorded in November 2021, according to data from CoinGecko.
Throughout its first year, Robinhood's stock (NASDAQ: HOOD) price had several ups and downs. Prices dropped by about half in 2022, and Tuesday's closing price was $9.23, a 1.1% increase over the past 24 hours.