Earnings Results: Robinhood’s active users fall, approaching pre-meme-stock-craze numbers

by | Nov 2, 2022 | Stock Market

Shares of Robinhood Markets Inc.
HOOD,
-4.36%
rose after hours Wednesday after the stock-trading app reported a narrower-than-expected loss and forecast lower expenses, even as active users turn away from the platform amid rising prices and recession fears. The company, which became a launchpad for last year’s meme-stocks frenzy and then a target for criticism from it, said monthly active users for September came in at 12.2 million, a drop from the prior quarter and down from 18.9 million in the quarter last year, “as customers continued to navigate the volatile market environment.”

The figure, as noted earlier by the Wall Street Journal, was the lowest since 2020. Robinhood closed out that year with 11.7 million users, according to its IPO prospectus. During Robinhood’s earnings conference call, executives noted some improvements in October. They said assets under custody moved back up to around $70 billion, compared with $64.6 billion at the end of the third quarter. Chief Executive Vlad Tenev also said that it had taken steps to design more features for its advanced traders, who he said “were on average less satisfied with our service than our other customers” at the beginning of the year. He said the company had since begun offering things like extended trading hours, stock lending and more sophisticated chart data. “And in the past six months we’ve seen a flip where advanced customers now have higher satisfaction with the Robinhood experience than our other customers,” Tenev said. For the third quarter, Robinhood reported a net loss of $175 millio …

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