It’s unclear when workers will start getting handed pink slips, which comes as the company adjusts to a slowdown in customer trading activity. The firings were made to “adjust to volumes and to better align team structures,” Chief Financial Officer Jason Warnick said in the message, the outlet reported. Transaction-based revenue was down 7% to $202 million while cryptocurrencies increased 7% sequentially to $58 million. Robinhood also today released its second quarter financials, revealing a 6% increase in net revenue of $318 million on a net loss of $295 million or 34 cents per diluted share. That loss was narrower than its net loss of $392 million, or 45 cents per share, in the first quarter of 2022.

"We're seeing more and more hoodies being quietly laid off due to their positions being eliminated," one employee asked in the meeting, which happened before the 150 layoffs. "Could we get some transparency here? How many hoodies have been eliminated, how many more will be and how much longer will this go on." "The world has changed. As Robinhood adapts to this new context, it's time for me to move on," she wrote in her post. "We all started trading contact information and phone numbers," one former employee said.

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The problems are mounting for Robinhood, a company that had big ambitions to revolutionize markets by attracting millions of amateur investors into stock trading for the first time. Tesla laid off nearly 200 Autopilot employees while Shopify laid off 10 percent of its workforce. On Wednesday, Chennapragada, the company's chief product officer, announced on LinkedIn and Twitter that she would step down but stay xcritical cheating on as an advisor to Tenev. The cuts mark the second round of layoffs this year for Robinhood, which previously shed 9% of its workers, as its business copes with a decline in equities and a "crypto winter" that decimated the value of many cryptocurrencies. "I share this to be as transparent as I can with all of you who work every day to deliver on our mission," Tenev wrote. "We will be parting ways with many incredibly talented people today in an extremely challenging macro environment, and I want to reduce the burden of this difficult transition as much as possible."

On top of that, the world is learning to live with the pandemic and people are no longer confined to their homes. As a result, Robinhood has faced a steep drop in active users and eroding earnings. This has been a tough year for stocks, which were trading at record highs at the end of 2021. Persistently high inflation led the Federal Reserve to raise interest rates aggressively, and that has hit high-growth tech stocks particularly hard. The company has seen its shares tank more than 70% since raising almost $2 billion when it went public in a high-profile initial public offering in 2021.

1. "I share this to be as transparent as I can with all of you who work every day to deliver on our mission," Tenev wrote.
2. Those who are affected by the cuts will be able to stay at Robinhood through October 1st at their regular pay and benefits alongside a severance package, Tenev says.
3. Morale at Robinhood has been on the decline since the company laid off 9% of its employees in April, the staffers said.
4. 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.

"The company is hemorrhaging money, and it's bad," one ex-employee said, sharing an opinion on the company's publicly reported quarterly financial figures. "I believe in the mission itself, but people cannot trust us ever since GameStop." 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. The cuts will primarily impact employees in Robinhood's operations, marketing, and program management departments, CEO Vlad Tenev said in a message to employees that was also posted on the company's blog. The stock trading and investing platform reported $441 million in earnings in Q1 of 2023. The fintech company is slashing 23% of its workforce, as first reported by the Wall Street Journal and confirmed by TechCrunch.

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Those who are affected by the cuts will be able to stay at Robinhood through October 1st at their regular pay and benefits alongside a severance package, Tenev says. In his Tuesday blog post, Tenev said "additional deterioration of the macro environment" since April's layoffs had left the brokerage in a weaker position than he had anticipated. And questions about the company's future, from both insiders and the industry players, burn hotter than ever. Insider spoke with five former employees of Robinhood, all of whom asked to remain anonymous to protect their future employment opportunities. They described a company, one year on since its public debut, facing a slowing market and looking for any and all ways to cut costs — and a workforce on tenterhooks with no clear line of sight into when the downsizing might end.

“Since that time, we have seen additional deterioration of the macro environment with inflation at 40-year highs accompanied by a broad crypto market crash. This has further reduced customer trading activity and assets under custody,” he wrote. Robinhood is not alone in its choice to conduct two rounds of layoffs in a short period of time; just seven weeks after crypto exchange Gemini cut approximately 10% of its workforce, the company cut another 7% of staff, according to sources.

Slumping morale

Earlier today, the WSJ wrote that Robinhood was slapped with a $30 million fine by a New York financial regulator, specifically on its cryptocurrency trading arm. Shopify, Netflix, Tesla and several crypto companies have also cut their workforces amid the worsening economic outlook. "We saw Vlad talk about how this was a product of the macro environment. Rising interest rates, all that stuff, but that didn't really change a whole lot from April until now," the former Charlotte employee said. "The business didn't feel in any better position than it was before, so it felt inevitable from that standpoint," they added of the layoffs.

"That was a 'come down to earth' moment for us. For a lot of people, we were living in fantasy land," one newly axed employee said. The 150 workers slated to be given pink slips is the third round of layoffs at the company since April 2022. The company earned $299 million during the same period in 2022, according to its earnings report.

Jason Warnick, the company's chief financial officer who has taken on the role of chief people officer, disclosed the company has made cuts through "reorgs," including in teams like recruiting, engineering, and data science. Robinhood said its transaction-based revenue — money it earns when customers trade stocks, options or cryptocurrencies — plunged from a year earlier, when many retail investors piled into on "meme stocks" and asset values were high. 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. "As CEO, I approved and took responsibility for our ambitious staffing trajectory — this is on me," he wrote. "In this new environment, we are operating with more staffing than appropriate." "As CEO, I approved and took responsibility for our ambitious staffing trajectory — this is on me," Tenev, also a cofounder of the company, wrote, referring to staffers as "Robinhoodies" and "Hoodies."

In Arizona, meanwhile, one former employee there who left the company in recent months told Insider that Robinhood had been looking to trim its footprint at a WeWork office in downtown Tempe, which opened in 2020. While the round of job cuts came as a shock to some, following a 9% workforce reduction just four months prior, insiders said they saw the signs. 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. At the time of publication, the company is trading at $8.90 after hours, dramatically lower — by 89% — than its 52-week high of $85.

Robinhood slashes 23% of its workforce amid trading slump

The announcements came as Robinhood released its Q earnings information a day earlier than scheduled, reporting total revenue of $318 million over the three months, which is 44 percent lower than the same period in 2021. Robinhood is letting go of nearly a quarter of its staff, CEO Vlad Tenev xcritical reviews said in a message posted to the company’s blog. Robinhood's stock peaked above $80 a share days after it went public last summer.

It's an understandable move, they added, given the brokerage's access to sensitive client information. Monthly active users have been steadily declining the past three quarters, from 18.9 million in the third quarter of 2021 to 17.3 million in the fourth quarter to 15.9 million by March 2022. Revenue dropped xcritical cheating 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. In the first quarter of 2023, monthly active users have dipped to 11.8 million.

The cuts mark another reversal for a company that created an app for trading stocks that became wildly popular when COVID-19 spread and the economy shut down, leaving millions stuck at home with plenty of time on their hands. In April, weeks before the 9% workforce reduction, Robinhood announced the acquisition of the crypto-asset firm Ziglu. Robinhood has roughly $6 billion in cash on its balance sheet, and the company has a $2.5 billion budget for acquisitions, Warnick said on the earnings call.