Robinhood Posts Mixed Results for Q3, 2021

Robinhood, the trading platform that is loved by Gen Z in the US, has announced the Q3 results for 2021 and it shows a mixed bag of results with the userbase increasing but the transaction volumes reducing when compared to the previous quarter.

The CEO of the platform said that the metrics of the platform always come in the form of waves with certain quarters doing well followed by quarters that are low and slow. This also tends to follow the market pattern to a great extent where periods of high volatility tend to bring in a lot of new and old users back to trading while periods of ranging generally tend to see users floating off to other instruments and markets in search of volatility and better returns.

The platform has added over 660,000 new users over the last 1 year bringing the total number of active users to 22.4 million which is about 97% more than what it was the previous year. Though the user base has increased a huge amount, the monthly active users were 18.9 million which was 76% more when compared to the same time last year but down from 21.4 million monthly active users when compared to the Q2 of 2021. This should not be very concerning for the company as yet as these are just for one quarter alone and the volumes and the users would be expected to rebound in the coming months.

On the other hand, the crypto community would be eagerly waiting for the launch of the crypto wallets by Robinhood as the company has said that it would be shipped to the first batch of users within the next few weeks as it has over 1 million customers in its waitlist. The company has also said that it would be thrown open to all users by the first quarter of 2022. It remains to be seen how the SEC would react to these upgrades as it does not seem to have a very favorable opinion of the crypto industry as yet. They are also actively contemplating banning of payments for order flow which is one of the most active channels of revenue for the company and so the company may choose to go slow on crypto, for now, to ensure that they don’t rub the SEC the wrong way at least for the time being.