Robinhood cuts hundreds of jobs as pandemic stock trading flurry slows
- Stock-trading app
Robinhoodis laying off about 9% of its staff, CEO Vlad Tenev said Tuesday.
- The company went on a hiring spree as its userbase exploded over the last two years.
Stock-trading app Robinhood plans to lay off 9% of its workforce, CEO and co-founder Vlad Tenev said in a blog post Tuesday.
The company hired ferociously as it boomed in popularity during the pandemic. But that expansion was too quick, leading to overlapping job functions and other issues, Tenev said.
"This rapid headcount growth has led to some duplicate roles and job functions, and more layers and complexity than are optimal. After carefully considering all these factors, we determined that making these reductions to Robinhood's staff is the right decision to improve efficiency, increase our velocity, and ensure that we are responsive to the changing needs of our customers," Tenev said.
Between 2020 and 2021, Robinhood grew its staff from 700 to around 3,800, Tenev said. The
Shares of Robinhood plunged by more than 5% to a record low below $10 per share in late trading on Tuesday before rebounding slightly. Shares are down more than 70% from their debut prices.
Robinhood grew at breakneck speed over the last two years thanks to massive trading interest as the pandemic kept people at home and government stimulus checks gave them some extra cash. But it has since lost momentum.
Monthly active users dropped from 18.9 million in the third quarter of 2021 to 17.3 million by the fourth quarter. In January, it projected that its first-quarter revenue will be 35% less than the same period last year.
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