Vlad Tenev, CEO and co-founder Robinhood Markets, Inc., is displayed on a display all over his corporate’s IPO on the Nasdaq Marketplace website in Instances Sq. in New York Town, U.S., July 29, 2021.
Brendan McDermid | Reuters
Robinhood CEO Vlad Tenev stated Wednesday that the retail brokerage isn’t having a look to be got in spite of pronouncing main layoffs after any other quarter of shrinking energetic customers.
“In a single phrase: No,” Tenev stated on an investor name when requested about doubtlessly being purchased by way of any other company. “I feel we are in an ideal place as a stand-alone corporate. I really like us as a stand-alone corporate.”
In Might, FTX CEO Sam Bankman-Fried published a stake in Robinhood, spurring hypothesis a couple of attainable takeover bid from the crypto-focused brokerage. Bankman-Fried has since stated FTX isn’t having a look to shop for Robinhood outright.
Tenev did say that Robinhood was once in search of attainable acquisitions of its personal. The corporate reported $6 billion in money on its steadiness sheet on the finish of the quarter.
“We in truth see alternatives, specifically on this marketplace atmosphere, to leverage the steadiness sheet that we’ve got … to procure firms that boost up our roadmap,” Tenev stated.
The Robinhood investor name got here an afternoon after the corporate introduced it was once shedding 23% of its group of workers. The corporate additionally reported a smaller-than-expected loss for the second one quarter, however per month energetic customers declined and earnings was once down greater than 40% 12 months over 12 months.
Stocks of Robinhood rose 11.7% on Wednesday following the layoff announcement. A number of Wall Boulevard analysts stated the corporate’s cost-cutting efforts generally is a spice up to the inventory.
Robinhood minimize its full-year expense steering by way of more or less $290 million, which contains about $70 million decline in anticipated share-based repayment. Tenev stated that the corporate plans to have sure adjusted EBITDA — a measure of profitability that excludes positive prices akin to hobby and taxes — by way of the tip of the 12 months.
The corporate pointed to charge hikes from the Federal Reserve as a income expansion within the type of hobby. CFO Jason Warnick estimated that each and every one-quarter of a proportion level charge hike interprets into about $40 million of annualized earnings for Robinhood.
“The right good thing about charge hikes relies on how balances and buyer charges range over the years,” Warnick stated.
The CFO additionally stated Robinhood’s belongings beneath custody rose again above $70 billion in July after declining in the second one quarter.
In spite of Wednesday’s rally, Robinhood’s inventory remains to be down just about 42% for the 12 months and greater than 70% from the place its IPO was once priced closing 12 months.
