Robinhood is allegedly preparing to fire some of its full-time employees.
Robinhood Markets, a stocks, exchange-traded funds and cryptocurrencies trading platform, is set to let go of about 150 full-time employees, making up 7% of its workforce. This development signals its third major staff cut within a year.
According to the Wall Street Journal report shared on June 26th, the news was unveiled in an internal company conversation.
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Jason Warnick, the Chief Financial Officer at Robinhood, cited an adaptation to changes in the trading volumes and an attempt to better streamline team structures as the main reason behind the job cuts.
When asked about the matter, a Robinhood spokesperson neither confirmed nor denied the claims but noted:
We’re ensuring operational excellence in how we work together on an ongoing basis. In some cases, this may mean teams make changes based on volume, workload, org design, and more.
This announcement of layoffs is happening shortly after Robinhood’s recent purchase of the credit card company X1 in a transaction worth $95 million.
In the past year, the trading platform's workforce had undergone significant reductions due to dwindling trading activities and the subsequent decrease in the prices of equities and cryptocurrencies. In April 2022, the total headcount was reduced by 9%, and then in August 2022, a further 23% was let go, resulting in a loss of over 1,000 employees.
During the second quarter of 2021, Robinhood had a flourishing customer base, with 21.3 million active users and a revenue exceeding $565 million. However, the recent Q1 2023 results paint a grim picture, with a 44% decline in monthly active users and a 30% annual decrease in revenue.
As Robinhood braces for this change phase, the market will watch closely to see how this restructuring will impact the company's future growth and user engagement.
