<p>The publicly-listed
provider of <a href=”https://www.financemagnates.com/terms/r/retail-trading/” class=”terms__main-term” id=”2d172307-15c6-4278-a100-fcbb8d9c19c9″ target=”_blank”>retail trading</a> solutions, Robinhood Markets (<a href=”https://www.financemagnates.com/tag/robinhood/” target=”_blank” rel=”follow”>NASDAQ:HOOD</a>), has shown
a mixed bag of January 2023 operating data, reporting a significant decrease on
a yearly basis, with a visible rebound when compared to December 2022.</p><p>Robinhood Reports Important Trading Metrics</p><p>The monthly
active users (MAU) base has contracted 31% year-over-year (YoY) from 17.3 million
to 12 million. However, the number of active users rose by 600,000 from 11.4
million reported a month earlier.</p><p>Similar
correlations apply to the vast majority of other reported statistics. The total
worth of assets under custody (AUC) also declined like MAU on an annualized
basis and was down 14% from $86.8 billion to $74.7 billion. However, AUC rebounded by
20% monthly from $62.2 billion.</p><p>In terms of
trading volumes, <a href=”https://www.financemagnates.com/terms/c/cryptocurrencies/” class=”terms__secondary-term” id=”b091101e-6e02-4b36-aa0e-7c972dfdd6ed” target=”_blank”>cryptocurrencies</a> were the strongest fallers, losing 59% YoY to
$3.7 billion. On the other hand, they recorded the most substantial monthly
rebound and are up 95% from the $1.9 billion reported in December 2022. Shares fell
24% YoY from $60.5 billion to $46 billion, rising 19% from the $38.6 billion
level reached a month earlier.</p><p>”Notional
Trading Volumes – which are the primary driver of transaction revenues – were
higher in January for equities, options, and crypto from December 2022.
Equities were $46.0 billion (up 19%), Options contracts were 82.9 million (up
10%), and Cryptocurrencies were $3.7 billion (up 95%),” Robinhood
commented in the statement.</p><p>Daily
Average Revenue Trades (DARTs) show similar outcomes: crypto DARTs fell by 36%
YoY while rising 37% monthly. Equity DARTs slid 21% YoY and rose 3% compared
to December 2022.</p><p>The latest
financial data released by Robinhood on Wednesday boosted the NASDAQ-listed stock
price during yesterday’s session. Ultimately, HOOD closed the day with a gain
of almost 6% at $10.63 per share. That does not change the fact that the stock has
lost almost 70% since its IPO in July 2021.</p><p>Robinhood’s Q4 Revenues Also Mixed</p><p>A week ago,
Robinhood <a href=”https://www.financemagnates.com/forex/robinhood-q4-crypto-revenue-dips-board-approves-buyback-of-sbf-stocks/” target=”_blank” rel=”follow”>announced its financials for the fourth quarter of 2022</a>, with a 5% increase
in total net revenue to $380 million, despite an 11% decrease in
transaction-based revenues to $186 million.</p><p>Cryptocurrency trading revenues were the hardest hit, shrinking from $39 million to $24 million. It was the
second consecutive quarter of declines in the three months that ended on 30
September 2022, <a href=”https://www.financemagnates.com/fintech/robinhood-lost-175m-in-q3-2022-crypto-revenue-declined/” target=”_blank” rel=”follow”>cryptocurrency trading was 12% less profitable</a>.</p><p>Additionally,
revenue from equity trading shrank to $21 million, which is down 32%. On the other hand,
revenue from options trading remained flat at $124 million. Finally, positive
total net revenue was provided by solid growth in net interest revenue, which
amounted to $167 million, increasing by 30%.</p><p>Watch the FMLS22 panel on post-covid challenges and opportunities waiting for retail traders.</p><p>SBF Stocks Buyback and
Shareholder Lawsuit</p><p>Meanwhile,
the company’s board approved the repurchase of 55 Robinhood shares owned by an
entity controlled by Sam Bankman Fried (SBF), Emergent Fidelity Technologies,
acquired in May 2022. <a href=”https://www.financemagnates.com/forex/brokers/ftx-ceo-sam-bankman-fried-buys-76-stake-in-robinhood/” target=”_blank” rel=”follow”>SBF held a 7.6% stake</a> in Robinhood after the transaction,
spending $648 million on the deal. The recent findings indicate that the funds
for the share purchase came from a direct loan from another SBF-owned company,
Alameda Research. </p><p>This week,
a US judge dismissed a lawsuit against the company accusing it of <a href=”https://www.financemagnates.com/forex/us-judge-dismisses-robinhoods-shareholder-lawsuit-over-2021-ipo/” target=”_blank” rel=”follow”>misleading
investors during its 2021 initial public offering (IPO)</a>. Judge Edward Chen of
the US District Court in San Francisco found no evidence that the information
published by Robinhood in its prospectus and disclosure materials was
incorrect, false or misleading. Instead, investors alleged that key financial
metrics depicting the company’s health fell sharply moments before the IPO, exposing them to financial losses.</p><p>Furthermore, Robinhood
has decided to abandon its plan to acquire Ziglu, a London-based crypto
portfolio investment company, which it initially announced in April 2022. As a
result, Mark Hipperson, the Founder and CEO of the company, <a href=”https://www.financemagnates.com/executives/ziglus-founder-resigns-after-aquisition-deal-with-robinhood-fails/” target=”_blank” rel=”follow”>has decided to give
up his role</a>.</p>
This article was written by Damian Chmiel at www.financemagnates.com.
