Robinhood is cutting back on its employees

• Robinhood is laying off nine percent of its workforce

• The company wants to steel itself for hard times

• The investment boom of the pandemic is fading

Robinhood is laying off 9 percent of its employees

The CEO of trading and investing app Robinhood, Vlad Tenev, has announced his company’s plan to lay off as much as 9 percent of its full-time employees. As Reuters reported earlier this year, Robinhood had a total workforce of 3,400 at the time, bringing the number of employees affected by the forthcoming wave of layoffs to around 300.

After the company went public in July 2021 and the stock peaked at $85, the stock’s value steadily fell to just $10. Although Robinhood has also had some positives to report in recent months, such as a 25 percent gain in value in March in response to announcing it was moving trading hours on the platform towards its 24-hour-a-day target the company also took some beatings. For example, last November Robinhood reported a massive data leak that affected millions of users.

The investment business boomed during the pandemic

According to the company, the reason for the layoffs planned by Robinhood is the disproportionate dimension that the workforce has assumed due to the massive growth that the platform has experienced during the global corona pandemic. As CEO Tenev writes in a blog post, the growth of his company has been extremely accelerated over the past two years by various factors such as lockdowns, low interest rates and government stimulus measures.

In order to be able to cope with the new dimensions, the workforce has increased sixfold during this time, bringing the number to almost 3,800 employees. As a result, according to Tenev, Robinhood now has a whole range of double-staffed jobs and tasks. Having now analyzed and evaluated the situation internally, it has come to the conclusion that the drastic reduction in jobs is the right decision to increase efficiency and ensure that the company reacts dynamically to the changing wishes of its customers could.

Thomas Weschle / Editor finanzen.net

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