The online broker Robinhood has laid off 10% of its employees. The company's CEO, Vlad Tenev, explained the cuts by the need to simplify the management structure. Our CEO Vlad Tenev shared the following note with our team at Robinhood today:Robinhoodies,We’ve made the difficult decision to say goodbye to some of our team members today. Those departing are being notified, and we’re offering them full support through this transition,…— According to him, Robinhood needs to get rid of excess hierarchy in order to become a "flexible and focused" team. Tenev emphasized that the broker's business is now stronger than ever, and the changes are preventive in nature. The goal of the reorganization is to increase efficiency and allow talented employees to take on more responsibility. The laid-off workers will receive severance pay and support during their transition to a new place. At the same time, Robinhood will continue to hire key specialists and invest in new technologies. Financial details According to a filing with the SEC, the cost of the layoffs will amount to about $20 million. The company will allocate another $8 million for compensation in the form of shares. Robinhood plans to record these costs in the second quarter. The restructuring is taking place against the backdrop of a downturn in the crypto division. In the first quarter, the company's profit came in below forecasts due to a decline in trader activity. Revenue from cryptocurrency operations fell 47% year over year — to $134 million, while trading volumes dropped by almost half. Despite this, the platform continues to expand. Robinhood closed the deal to acquire the company WonderFi for $180 million. The acquisition brought the broker more than 300,000 new customers from Canada, increasing its international base to 1 million users. Recall that Bernstein analysts said that Robinhood would earn $586 million on prediction markets.

Source: ForkLog