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- Robinhood plans to cut down the massive employee workforce by 9% due to complexities hovering around.
- The exchange gained high popularity in recent years due to its focus on new investors.
- But despite the market conditions, the CEO remains optimistic about the company’s financial position.
Amid all the competition, the popular crypto exchange Robinhood now witnesses foggy clouds. And now, it has decided to reduce its massive workforce of around 3,800 employees by 9% due to a decline in retail investment and the popularity of zero-fee stock trading.
According to CEO Vlad Tenev, the rapid headcount growth has resulted in some duplicate roles and job functions and more layers and complexities than optimal. They are determined that making these reductions to the staff of Robinhood is the right decision to improve efficiency and increase their velocity. And to ensure that they are responsive to the changing requirements of their consumers.
Robinhood as an exchange gained immense popularity during the pandemic as it facilitated the new investors with investments in meme stocks and cryptocurrencies with its zero-fee trading. It took care of the market that the conventional brokerages ignored.
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The CEO Remains Positive
But despite the popularity, the equity trading numbers in the US have plunged by around 7% compared to a year ago, which has left Robinhood and other brokerages to struggle. Even Robinhood’s recent move of offering crypto wallets and debit cards couldn’t make much difference.
But Robinhood is all set to roll out new products across varied business areas, like brokerage, crypto, and spending and saving.
Robinhood’s first-quarter upcoming earnings report has not witnessed optimistic sentiments either. Given the fact that it has incurred around $2 Billion in losses since its Initial Public Offerings around a year ago.
And since then, the stock is down by 75%, and an additional drop of 5% came during extended trading after the news related to the staff decrease.
But the CEO still remains optimistic as he highlights that the financial position stays strong as they have over $6 Billion in cash on their Balance Sheet.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
