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Earnings Results: Robinhood stock falls more than 11% after quarterly miss, fewer users

Robinhood Markets Inc. shares fell more than 8% late Thursday after the online-trading company missed Wall Street expectations for its first quarter and said it saw fewer people trading equities, crypto and options on its online platform, blaming the missteps on the “macroeconomic environment.”

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said it lost $392 million, or 45 cents a share, in the quarter, compared with a net loss of $1.4 billion, or $6.26 a share, in the year-ago period. Revenue fell 43% to $299 million, compared with $522 million in the first quarter of 2021.

FactSet consensus called for a loss of 38 cents a share on sales of $355 million.

Transaction-based revenue fell 48% to $218 million, including a 39% drop for cryptocurrency revenues and a 73% decline for equities revenue, the company said.

“We’re seeing our customers affected by the macroeconomic environment, which is reflected in our results this quarter,” Chief Financial Officer Jason Warnick said in a statement. “At the same time, we’ve also made progress on our long-term plans and continue to pursue them aggressively.”

Co-founder and Chief Executive Vlad Tenev highlighted new products, such as crypto wallets to all customers, and said that Robinhood had made progress. The new products “will excite and delight our customers,” he said.

Monthly active users fell by 10% to 15.9 million in March 2022, compared with 17.7 million for March 2021, Robinhood said. The number of active users fell 8% as compared with December 2021, mostly thanks to users with lower balances engaging “less in the current market environment,” the company said

Robinhood on Tuesday announced it was laying off 9% of its workforce, saying in a blog post that the company experienced a “rapid headcount growth” recently and that was led to some duplicate roles and “more layers and complexity than are optimal.”

In connection with the layoffs and other cost reductions , Robinhood said it expects 2022 operating expenses, excluding share-based compensation, to increase between 2% and 5% year-over-year, compared with a prior expectations of an increase between 15% and 20%.

The company also said it will start reporting some of its metrics monthly, and with that change it will no longer offer revenue guidance.

Robinhood stock has flirted with lows this week, but ended the regular trading day Thursday up 6%. The stock is trading around $10, well below its initial public offering price of $38 from last July.

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