(San Francisco) U.S. online brokerage platform Robinhood is to lay off 23% of its staff, or more than 750 people, as interest in the stock market and cryptocurrencies has largely waned from the boom seen during the pandemic.
Posted at 7:00 p.m.
“Last year, we recruited on the assumption that the appetite for the stock market and cryptocurrencies observed in the era of COVID-19 would continue in 2022”, explained the boss Vlad Tenev in a letter to the. employees published on the company’s blog.
The California-based company had already laid off about 9% of its workforce at the end of April, after seeing the number of active users drop by 8% between the third and fourth quarters of 2021. It also indicated that it would focus on cost control.
“That was not enough”, notes Vlad Tenev in his missive addressed to the “Robinhoodies” (the “Robinhoodiens”, a play on words between Robin des Bois and hoodie).
“Since then, we have seen the macro-economic environment deteriorate even more, with inflation at its highest in 40 years, accompanied by a collapse of the crypto market”, he explains. “This has further reduced our customer base and assets under our control. »
The platform, which went public a year ago, retains around 2,600 employees, after having dismissed some 1,100 people in all.
This second wave of layoffs will concern all trades, but primarily operations and marketing, said the boss.
According to its quarterly earnings release on Tuesday, the service had about 15 million monthly active users at the end of June, 28% less than a year ago. Its turnover plunged by 44% over one year.
Although short, its history has already been marked by several controversies.
Its founders have repeated that they want to “democratize access to finance”, but their economic model is worrying, because Robinhood finances the absence of commissions by subcontracting its large volumes of orders to intermediaries who pay it. A legal practice, but opaque and potentially a source of conflict of interest.
On Monday, a New York financial services regulator fined its cryptocurrency business $30 million for violating money laundering and cybersecurity laws.
Robinhood’s stock has lost half its value since the start of the year.