Robinhood CEO Vlad Tenev said the layoffs were concentrated in the operations, marketing and program management departments.
Robinhood CEO Vlad Tenev said the company is cutting its workforce by another 23%. To explain this decision, Vlad Tenev cited the difficult macroeconomic environment, which has weighed heavily on the equity and cryptocurrency markets since the beginning of the year.
“We saw a further deterioration in the macroeconomic environment, with inflation at a 40-year high, accompanied by a massive cryptocurrency market crash. This further reduced client trading activity and assets under custody“, he said, while clarifying that the layoffs were concentrated in the operations, marketing and program management departments of the company.
This isn’t the first time Robinhood has cut staff this year. In April, the company first cut 9% of its 3,800 employees in a bid to cut costs and improve efficiency. After these latest cuts, Robinhood would still have 2,662 employees.
Soaring inflation and interest rate hikes by the Federal Reserve have crushed risky assets in the first half of 2022. High-growth tech stocks and cryptocurrencies, which have generally received the highest trading volumes from Robinhood users, have performed very poorly this year, a factor that could contribute to the trading app’s financial struggles.
Vlad Tenev ended his note by assuring all affected employees that they would have the option of remaining employed by Robinhood until October 1, 2022, while receiving their usual salary and benefits.