Robinhood Lays Off 23% of Staff a Day Before Earnings Report

Analysts had predicted a decline in earnings prior to the layoff announcement

article-image

Source: Shutterstock

share

key takeaways

  • Laid off employees will have the option to stay until Oct. 1, 2022 with full pay and benefits
  • HOOD was trading about 4.5% lower in after-hours trading Tuesday

Robinhood has shed 23% of its staffers, the company said Tuesday — one day ahead of its second-quarter earnings call. 

The cuts are mostly concentrated to the operations, marketing, and program management teams, Robinhood CEO Vlad Tenev wrote in a blog post. The move comes shortly after the company announced a 9% reduction in headcount in April 2022, citing a decrease in growth. 

[stock_market_widget type=”accordion” template=”chart” color=”#7C2AD5″ assets=”HOOD” start_expanded=”true” display_currency_symbol=”true” api=”yf” chart_range=”6mo” chart_interval=”1wk”]

The impact on the company’s crypto trading business isn’t clear. A spokesperson for the division did not immediately return a request for comment. 

The initial round of cuts “did not go far enough,” Tenev wrote. 

Macro conditions and increasing inflation have contributed to decreased trading activity — leading to lower fee revenue — Tenev said. Additionally, the crypto market’s recent crash has negatively impacted trading volumes and related assets.

“Last year, we staffed many of our operations functions under the assumption that the heightened retail engagement we had been seeing with the stock and crypto markets in the COVID era would persist into 2022,” Tenev said. “In this new environment, we are operating with more staffing than appropriate.”

Laid off employees will receive an email and Slack message, the blog said. Departing staff will have the option to remain employed through Oct. 1, 2022 with full pay and benefits. 

Analysts had already estimated that Robinhood, which went public in 2021 after pioneering a zero-fee trading structure for equities, would miss Wall Street’s consensus growth metrics — before the layoffs were made public. 

The company’s stock traded about 4.5% lower in Tuesday’s after-hours session.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the Forward Guidance newsletter.

Get alpha directly in your inbox with the 0xResearch newsletter — market highlights, charts, degen trade ideas, governance updates, and more.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Javits Center North | 445 11th Ave

Tues - Thurs, March 18 - 20, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Unlocked by Template.png

Research

RTK networks are critical to enabling a world of ubiquitous autonomous drones, vehicles, and industrial robots. We believe the GEOD token enables both a cost and product advantage for the GEODNET RTK network, which will allow it to out-compete multi-billion dollar incumbents Trimble and Hexagon.

article-image

Crypto’s calls are equally as juiced as puts, creating a “smile” in the volatility surface

article-image

Turns out that owning the end-user via a crypto wallet is quite a prosperous business

article-image

The announcement followed growing speculation that Gensler would announce his exit before Trump takes office next year

article-image

HashKey Capital’s Jupiter Zheng highlighted three success areas he’s watching: Ethereum, Solana and certain tokens in DeFi

article-image

Jack explored the various AI and memecoin projects that have sprung up over the past month

article-image

If gold remains steady today, a single move from bitcoin to $98,500 would do it