Home Finance Robinhood shares fall after retail broker posts drop in revenue, users

Robinhood shares fall after retail broker posts drop in revenue, users

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The emblem of Robinhood Markets, Inc. is seen at a pop-up occasion on Wall Avenue after the corporate’s IPO in New York Metropolis, U.S., July 29, 2021. REUTERS/Andrew Kelly

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April 28 (Reuters) – Shares in Robinhood Markets Inc (HOOD.O), the brokerage on the middle of final yr’s retail buying and selling frenzy, slipped to a report low on Thursday after it posted a 43% fall in first-quarter income and a decline in month-to-month lively customers.

Shares of the Menlo Park, California-based agency dropped greater than 12% to $8.83 in prolonged buying and selling following the outcomes. The shares, which have misplaced greater than 43% of their market worth thus far this yr, have been offered in its IPO final July for $38 apiece.

“For many of our historical past, Robinhood has operated in a interval of low rates of interest, low inflation and rising markets. Our prospects at the moment are experiencing all three of those traits stepping into the wrong way, maybe for the primary time of their lives,” stated Robinhood Chief Government Officer Vlad Tenev on a name with analysts.

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Buying and selling volumes have eased from final yr’s frenetic tempo when retail buyers used the platform to pump cash into shares of so-called meme shares together with GameStop (GME.N) and AMC Leisure (AMC.N).

Robinhood stated on Tuesday it was shedding about 9% of its full-time workers, including speedy headcount progress had led to some duplicate roles and job features. learn extra

“We’re transferring again to being a extra lean firm with a leaner working mannequin, beginning with the discount in drive that we introduced earlier this week,” stated Chief Monetary Officer Jason Warnick on a name with reporters.

Excessive-growth expertise shares have come underneath strain this yr because the poor efficiency of shares and falling analyst confidence sours investor sentiment.

Frequent with different high-growth tech companies, Robinhood has but to show a revenue since its market debut. The corporate reported a web lack of $392 million or $0.45 per share within the three months ended March. A yr earlier, which was earlier than its IPO, it firm posted web lack of $1.4 billion or $6.26 per share.

Analysts on common had anticipated a web lack of $0.36 per share, based on IBES knowledge from Refinitiv.

Whole web revenues decreased to $299 million, in contrast with $522 million a yr earlier.

Robinhood’s month-to-month lively customers fell 10% to fifteen.9 million for March 2022, in contrast with 17.7 million for March 2021. The corporate attributed the decline to customers with decrease balances.

Transaction-based income from cryptocurrencies, which has been a boon for Robinhood in earlier quarters, fell 39% to $54 million.

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Reporting by Manya Saini in Bengaluru and Hannah Lang in Washington; Modifying by Aditya Soni, Will Dunham and Richard Pullin

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