Robinhood Cuts 10% of Staff Amid Record Trading Volumes

Financial platform Robinhood Markets says it is laying off 10% of its staff.

The job cuts are part of the company’s “efforts to maintain a high performance culture, further accelerate product velocity, and remain lean and disciplined,” Robinhood said in a Tuesday (June 16) Securities and Exchange Commission (SEC) filing.

The filing added that Robinhood “is taking this action from a position of business strength, including June month-to-date average daily trading volumes at record levels across equities, options and prediction markets.”

A report on the cuts by the Wall Street Journal (WSJ) said the layoffs, which will eliminate around 290 jobs, are Robinhood’s first cuts in three years. The report also cited a note to employees from CEO Vlad Tenev who said Robinhood’s business has never been stronger.

“It is the hardest consequence of committing uncompromisingly to our values of being ‘lean & disciplined’ and demanding ‘high performance,’” Tenev wrote.

Robinhood reported a 15% increase in revenue during its most recent earnings, although its stock dipped as that figure fell short of analyst expectations.

“The most striking feature of the quarter was not the revenue miss itself but the reshuffling of where that revenue comes from,” PYMNTS wrote at the time.

“Historically, Robinhood’s growth engine was powered by transaction-based activity, and especially cryptocurrency trading. That engine is now sputtering, with crypto trading revenue plunging roughly 47% year over year.”

In its place, two newer revenue sources have stepped into the limelight: subscription services and prediction markets.

This shift, PYMNTS added, marks a major evolution for the company, as it moves from being simply a brokerage to “a hybrid platform where investing, speculation and entertainment can increasingly blur.”

That evolution continued last week when Tenev announced Robinhood could now serve as an underwriter for initial public offerings (IPOs).

Tenev also announced in May that Robinhood’s first fund, aimed at giving retail investors greater access to private markets, had attracted 150,000 customers.

“It’s also just the beginning,” Tenev said in a speech at the WSJ’s Future of Everything event.

“The aspiration is, if you’re a company raising a seed round and a Series A round, so just first capital, retail should be a big chunk of that round, much like it now is in the public markets, and we should let those people in at the ground floor so that they can actually benefit from this potential appreciation that’s increasingly happening in the private markets.”

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