Retail shareholders ask questions on Robinhood call

Robinhood’s (HOOD) earnings contact incorporated a collection of formerly submitted shareholder thoughts ranging from “Will HOOD fork out out a dividend in the foreseeable future?” to “Is Robinhood getting a crypto wallet?”

The financial commitment app has no plans to issue dividends, and as for crypto wallets, “it’s some thing our group is operating on” but it is now tough since of scale, answered CEO Vlad Tenev. 

In line with the company’s “democratize finance for all” theme, the buying and selling platform authorized shareholders to post thoughts ahead of the call. Individuals with the most ‘upvotes’ ended up answered by management.

“What’s future for Robinhood? If PFOF is regulated, what can you do?” go through a further shareholder issue.

PFOF is when a brokerage agency funnels trades to market place makers for a charge. Considerably of Robinhood’s past revenue has stemmed from payment for buy stream.

CFO Jason Warnick observed Robinhood is continuing to diversify its earnings stream and will target on its solitary money app going forward, which will imply far more goods and far more characteristics.

Afterwards on the connect with, Warnick claimed, “We don’t anticipate payment for buy movement to be banned.”

Crytpo activity surges

The company reported full earnings of $565 million, up 131% calendar year in excess of 12 months.

Robinhood documented far more than 50 percent of its complete transaction-based mostly income came from crypto trading, filling the gap for a drop in equity trades year-above-12 months. Crypto transaction-primarily based revenue for the 2nd quarter was $233 million, compared to just $5 million for the identical quarter in 2020.

Nonetheless, the enterprise warned of decreased income anticipations for the 3rd quarter. Shares fell about 5% in right after several hours.

[Read more: Robinhood earnings: Crypto trading skyrockets in Q2]

“For the a few months ended Sept 30, 2021, we count on seasonal headwinds and lessen trading action across the sector to consequence in lessen revenues and considerably less funded accounts than in the prior quarter” examine the firm quarterly report. 

Tale proceeds

‘Diamond-handed’

Robinhood highlighted its IPO accessibility item which it introduced in May possibly. It makes it possible for retail traders to entry shares at the first general public featuring price.

“Customers that have been participating in these IPOs have been comparatively diamond-handed, so to communicate … They’ve been keeping onto these stocks for over 30 days, “ mentioned Tenev.

Ines is a markets reporter covering shares from the ground of the New York Stock Trade. Stick to her on Twitter at @ines_ferre

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