Popular retail brokerage app Robinhood Markets Inc HOOD plans to let go of 9% of its full-time employees.
What Happened: In an announcement on Tuesday, Robinhood CEO Vlad Tenev explained the rationale behind the decision to reduce its employee count.
“We grew net funded accounts from 5M to 22M and revenue from ~$278M in 2019 to over $1.8B in 2021. To meet customer and market demands, we grew our headcount almost 6X from 700 to nearly 3,800 in that time period,” said Tenev.
“This rapid headcount growth has led to some duplicate roles and job functions, and more layers and complexity than are optimal.”
Tenev said that the move to downsize its workforce would ultimately improve efficiency, increase velocity and improve Robinhood’s responsiveness to the changing needs of customers.
Robinhood has over $6 billion in cash on its balance sheet and plans to accelerate its product momentum by introducing new products across brokerage, crypto, and spending/saving this year.
See Also: HOW DOES ROBINHOOD MAKE MONEY?
Last month, the platform launched a new cash card that auto-invests users’ spare change in stocks and cryptocurrencies, including Bitcoin BTC/USD, Ethereum ETH/USD, and Dogecoin DOGE/USD.
Price Action: Robinhood shares traded 2.20% lower during the after-market session on Tuesday.
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