Robinhood Markets announced Tuesday it will reduce its headcount by 10%, or about 290 employees, as part of a restructuring aimed at streamlining operations and reallocating resources.

The trading platform, which employs around 2,900 people, also plans to close several open job listings. CEO Vlad Tenev communicated the cuts in a note to staff posted on social media platform X.

“We cannot default to operating as a heavily-layered organization. We must be a lean, hyper-focused team,” Tenev wrote. He added that “Robinhood’s business has never been stronger.”

According to the AFL-CIO’s CEO pay tracker, Tenev made seven times more than the average Robinhood employee in 2024. The Menlo Park, California-based company expects the restructuring to cost $28 million in the second quarter.

Analysts noted that AI-driven efficiency was not the primary driver of the cuts, as Robinhood has long leveraged artificial intelligence. However, technology is enabling a flatter, more productive structure, said Citizens JMP Securities analyst Devin Ryan.

Robinhood emphasized it is acting from a “position of business strength,” citing record average daily trading volumes in June across equities, options, and prediction markets.

The layoffs come after Robinhood missed first-quarter profit expectations in April due to crypto-driven volatility. Market conditions have since improved, with easing Middle East tensions and strong equity markets supporting retail trading.

Retail investors tend to pull back during periods of heightened volatility. To reduce reliance on trading activity, Robinhood has expanded into a broader financial services platform in recent years.

Robinhood’s stock was down 2.9% in midday trading on Wall Street.

Source: www.aljazeera.com