Robinhood Markets Inc. is cutting 9% of its workforce, the online-trading platform’s chief executive announced Tuesday afternoon, as the company’s stock hit another new low.
CEO Vlad Tenev wrote in a blog post that Robinhood HOOD, -3.75% increased its workforce from about 700 employees to nearly 3,800 since the beginning of 2020, as the company’s trading app increased in popularity.
“This rapid headcount growth has led to some duplicate roles and job functions, and more layers and complexity than are optimal,” he wrote. “After carefully considering all these factors, we determined that making these reductions to Robinhood’s staff is the right decision to improve efficiency, increase our velocity, and ensure that we are responsive to the changing needs of our customers.”
Robinhood stock closed at $10 on Tuesday, its lowest closing price since going public at $38 a share last July. Shares moved as high as $85 after the initial public offering, but have been in a free fall so far this year, declining 43.6% so far in 2022 as the S&P 500 index SPX, -2.81% has fallen 9.9%.
Shares fell 2.6% in after-hours trading following the announcement Tuesday afternoon. Tenev did not provide any information about the company’s recent performance in the blog post, besides stating the company still has more than $6 billion in cash on the balance sheet; the company had more than $8 billion in cash and equivalents at the end of 2021, according to FactSet.
Robinhood is scheduled to release first-quarter results Thursday afternoon.