If implemented, it would mark the third round of layoffs for Robinhood in just over a year. The brokerage firm laid off 9% of its employees in April 2022 and 23% in August of the same year.
Robin Hood Due to lack of demand, it is planning to lay off some of its employees to reduce the cost of operations. Many existing employees were employed to fill various essential roles during the COVID period. During that time there was a huge demand for cryptocurrency trading and other Robinhood services, which led to a significant increase in the company’s monthly users.
During the pandemic, many people were able to put their time into business, and they also had more money because they weren’t going out and spending as much as they normally would. Additionally, many people benefited from the government’s stimulus checks. The increase in users necessitated an increase in the company’s workforce. As a result, between 2020 and 2021, the number of employees in the company grew by 700 to around 3,800.
Despite having a large customer base during the pandemic, the California-based company has struggled to retain many people, resulting in a significant drop in monthly active users.
According to Cointelegraph, a company spokesperson neither confirmed nor denied the news in a comment to the media agency. Spokesman where did it go,
“We are working closely together on an ongoing basis to ensure operational excellence. In some cases, this may mean that teams make changes based on volume, workload, organization design, and more.
Robinhood to have two rounds of layoffs in 2022
This isn’t the first time Robinhood is laying off employees. If executed, this would be the brokerage firm’s third layoff within a year. In April 2022, it fired 9% of its employees. The CEO, Vlad Tenev, said the layoffs were necessary to increase efficiency and the company’s momentum. He noted that there were multiple roles with overlapping duties, as well as other issues that the company needed to address.
In August of the same year, the stock trading company laid off 23% of its employees, mainly those involved in marketing and program management. Tenev, discussing a second layoff in 2022, noted that the first round of layoffs didn’t go far enough and the company needed to reduce costs amid inflation.
It is clear that most of the recent layoffs at Robinhood are the result of the hiring spree that took place between 2020 and 2021. The surge in demand for crypto, shares and other Robinhood services slowed down as people returned to their workplaces. As a result of which there has been a huge reduction in the number of service users. The last two rounds of layoffs affected over 1,000 employees.
This news has come at a time when the company recently… acquired X1 Inc, a financial technology firm, for approximately $95 million. The move is aimed at diversifying the company’s income streams as it seeks to offset issues in its primary business.
Temytop is a writer with over four years of experience writing in various fields. He has a special interest in the Fintech and Blockchain sectors and enjoys writing articles in those fields. He holds bachelor’s and master’s degrees in linguistics. When he is not writing, he trades forex and plays video games.
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