CEO Vlad Tenev admitted that the company had over-hired in 2021, anticipating that the heightened retail engagement would continue into 2022. You can update your choices at any time in your settings. It was then rolled out to 1 million waitlisted users, following a soft-launch in September when the wallet was rolled out to 10,000 waitlisted users.
Tenev in his letter to staff suggested the company wouldn’t shrink from its planned expansion into crypto and internationally, despite the cuts. “It was pretty clear that they over hired,” said the employee, a broker who worked with customers on complicated products, like margin and options trading. One Robinhood employee described the company’s founders as “visibly shaken” in announcing the layoffs to employees at an all-hands meeting Tuesday. When the online brokerage Robinhood went public in July, the company was riding the wave https://scamforex.net/ of a retail trading frenzy that had dominated markets and headlines throughout the coronavirus pandemic.
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Revenue from transactions at the company more than halved to $202 million in the quarter ended June 30, compared with $451 million a year earlier. BlackRock has teamed with Coinbase in a crypto market expansion. It added to its lead in July as stock markets improved. Inflation, rising rates, and the “crypto winter” are creating financial strain. Now, a year after going public, Robinhood Chief Executive Vlad Tenev admitted the company added too much staff too quickly. When we were cooped up at home in the early stages of the pandemic, Robinhood became a go-to app for folks with extra time and stimulus checks.
It is evident that most of the recent layoffs at Robinhood have been a consequence of the hiring spree that took place between 2020 and 2021. Robinhood plans to lay off some part of its staff as it seeks to reduce the cost of operations due to the reduction in demand it is experiencing. If implemented, it will mark the third round of layoffs for Robinhood in just over one year. Sometimes, this may mean teams make changes based on volume, workload, org design, and more.”
The case was dismissed by the Miami federal court in November 2021 on the grounds that the plaintiffs fell short of providing direct evidence of an antitrust conspiracy and that its terms of service allowed the company to prohibit trading by customers. In September 2024, Robinhood paid $3.9 million and instituted changes to settle claims by the State of California that, between 2018 and 2022, customers could not make timely withdrawals of cryptocurrency from their Robinhood accounts to cryptocurrency wallets. In August that year, the company announced additional layoffs of 23% of its workforce, mostly in operations, marketing and program management. In the second quarter of 2020, during the 2020 stock market crash, compared to the first quarter of 2020, trading volumes increased 139%, more than any other major brokerage. The company has been referred to as an innovator in zero-commission stock trading, as it relies on other sources of revenues.
- The trading app laid off 23% of its staff on Tuesday, following a first round of cuts in April.
- Each company faced unique circumstances leading to their decisions, such as shifts in user demand, regulatory pressures, or internal strategic realignments.
- As to which departments or roles at Robinhood suffered from layoffs, some in the company’s HR and Lxcriticalg and Development teams have shared that they were let go.
- Robinhood’s Q results displayed a significant decline, with a 44% decrease in monthly active users and a 30% year-over-year drop in revenue.
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Start your journey into the world of Robinhood by understanding its transformative approach to commission-free trading. If you’ve been following the financial news lately, you may have come across the recent developments surrounding Robinhood. A number of financial and crypto companies xcriticald in to share open roles, including Kraken, Block’s Square, and Uniswap Labs. As to which departments or roles at Robinhood suffered from layoffs, some in the company’s HR and Lxcriticalg and Development teams have shared that they were let go. This month, Robinhood also added a number of new cryptocurrencies to its platform, allowing users to buy Solana, Compound, Polygon’s MATIC token, and Shiba Inu, the latter of which saw prices pump 20% after being listed on the platform.
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Robinhood also purchased Chartr, a data-driven newsletter publisher focused on visual storytelling, in 2023. The website features a section dedicated to Snacks, the popular newsletter Robinhood acquired in 2019. Sherwood’s editorial focus includes markets, tech, and “the culture of money.” “Over the past 18 months, Sherwood has hired dozens of journalists, launched new products, and acquired the newsletter brand Chartr,” a Robinhood spokesperson told Business Insider in a statement. Sherwood joins several other publishers that have cut staff this year, including NBC News, CNN, TechCrunch, and Vox.
Robinhood Layoffs: What Happened & Why?
The following month, Robinhood launched its “Sherwood News” website and a rebrand of its financial newsletter Snacks. In February 2018, the company announced that it would be moving its headquarters from Palo Alto to the former headquarters of Sunset magazine in Menlo Park. Robinhood was founded in April 2013 by Vladimir Tenev and Baiju Bhatt, who had previously built high-frequency trading platforms for financial institutions in New York City. Robinhood has targeted millennials as customers; in March 2025, the average age of its customers was 35. It also offers cryptocurrency wallets, wealth management, credit cards and other banking services, some in partnership with banks insured by the FDIC, as well as a news website, Sherwood.News. Robinhood Markets, Inc. is an American financial services company based in Menlo Park, California.
The impending layoffs were announced less than a week after Robinhood acquired no-fee credit card startup X1 in a $95 million cash deal. The company earned $299 million during the same period in 2022, according to its xcriticalgs report. Meanwhile, Robinhood’s LinkedIn page boasts job openings for 185 positions at its headquarters in Melo Park, Calif., as well as offices in New York, Denver, Seattle and more. About 150 workers across customer experience and platform shared services; customer trust and safety; and safety and productivity will be affected, according to an internal memo obtained by The Wall Street Journal. Our experienced team covers market movements, xcritical developments, and emerging trends with rigorous editorial standards and factual accuracy. Ethan Blackburn works as a full-time content writer and editor specializing in online gaming and sports betting content.
It provides an electronic trading platform that facilitates trades of stocks, exchange-traded funds, options, index options, futures contracts, outcomes on prediction markets, and cryptocurrency. Revenue dropped 43% in the first quarter compared to the year prior as “customers became more cautious with their portfolios,” Tenev said at the time. The company previously announced plans in April to lay off 9% of its workforce after growing too rapidly during the pandemic amid a boom in stock-trading interest. Stock-trading app Robinhood will lay off 23% of its staff, the company announced Tuesday. Tenev said employees across the company will be impacted by the layoffs, but that the cuts will be focused in Robinhood’s operations, marketing and program management groups. In a blog post on Tuesday, Robinhood CEO Vlad Tenev blamed “inflation at 40-year highs accompanied by a broad crypto market crash” for the company’s financial woes.
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It’s unclear when workers will start getting handed pink slips, which comes as the company adjusts to a slowdown in customer trading activity. As Robinhood navigates through the challenges of a changing market landscape and regulatory environment, strategic restructuring and cost-cutting measures are imperative for the company’s future success. By introducing new features, such as advanced trading tools, educational resources, or innovative investment products, Robinhood can enhance user engagement and provide added value to its customers.
Robinhood Implements Workforce Reduction: Layoffs Target 7% of Full-Time Employees, Reveals Report
Stay tuned for updates on how Robinhood’s strategic initiatives unfold in response to market dynamics and stakeholder expectations. By realigning operations, optimizing resources, and diversifying product offerings, Robinhood aims to strengthen its position in the market and rebuild trust among investors. By fostering strategic alliances and aligning with key players in the financial sector, Robinhood can position itself as a trusted and reliable platform for investors seeking secure and accessible investment opportunities.
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- Robinhood was founded in April 2013 by Vladimir Tenev and Baiju Bhatt, who had previously built high-frequency trading platforms for financial institutions in New York City.
- The following June, Robinhood announced additional layoffs of 150 employees or about 7% of its staff.
- Posts on a private group for people with a Robinhood.com email address on the tech-industry chat app Blind suggests layoffs as recently as Thursday, according to screenshots viewed by Insider.
- During this period, Robinhood witnessed a surge in new traders flocking to the platform in search of opportunities in the evolving market landscape.
Securities and Exchange Commission in May 2024 alleging that the company had violated securities laws over crypto tokens traded on its platform; Robinhood countered that cryptocurrencies are not securities and are not covered by securities laws. Robinhood then began offering additional guidance and requiring additional criteria and education for customers seeking authorization to trade options. The company also was criticized for not responding timely to inquiries by Kearns about the negative balance. In March 2023, the company agreed to pay $10 million to settle class action lawsuits regarding trading losses due to the outages.
But by May 2023, the company reported fewer than 11 million monthly active users, and its transaction-based revenue dropped 5% year-over-year in xcritical reviews the first quarter of 2023. Robinhood had a significant rise in popularity during the COVID-19 pandemic, attracting millions of users for stock, options and cryptocurrency trading. The layoffs come shortly after Robinhood announced its agreement to acquire credit-card startup X1 in a $95 million cash deal, indicating the company’s move to expand its product offerings beyond trading.
On January 28, 2021, several stockbrokers, including Robinhood, restricted the trading of certain stocks, most notably GameStop, to meet collateral requirements at its clearing house, the National Securities Clearing Corporation, following an effort by users of the r/wallstreetbets subreddit to drive up share prices. Robinhood Financial was also ordered to pay $3.75 million in restitution to certain customers whose market orders were restricted and canceled, leading them to re-enter their orders and receive executions at a less favorable price. On Monday, March 2, 2020, during the COVID-19 pandemic, likely due to high trading volumes, Robinhood suffered a systemwide, all-day outage that prevented users from accessing the mobile app on a day when the S&P 500 climbed more than 4.6%. Passwords were then hashed using the Bcrypt algorithm and the company advised customers to change their passwords. The Financial Industry Regulatory Authority fined Robinhood $1.25 million in December 2019 for failing to ensure that its customers received the best price for orders, instead routing orders based on payments that it receives from market makers. In June 2025, the company launched trading in tokenized ETFs and stocks in the European Union.
The decrease in customer trading activity and engagement could be attributed to factors such as higher costs of commodities and a downturn in the cryptocurrency market. Currently, the trading app holds approximately $12 billion worth of cryptocurrency in its custody, reflecting a 50% increase over the quarter. The company reported $38 million in crypto trading revenues for Q1 2023, showing a 30% decrease compared to the same period in 2022 when it generated $54 million.