Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Robinhood reports 43% revenue decline

wsj.com

Post reply on HN
Print view View original

71–80 of 220 posts

Re: Robinhood reports 43% revenue decline

#71

Post by xur17 »

buildbuildbuild wrote: post #38

I’m a big believer in their future. As soon as they release their native crypto deposit/withdraw functionality beyond beta (it’s amazing), Robinhood will be the first true crypto exchange with an attached U.S. bank account. [1] That means no transfer times between banks and an exchange. Deposit and sell crypto, instantly spend fiat on their debit card. Deposit your paycheck ACH, withdraw crypto to your own wallet. La…

Coinbase has a U.S. bank account with a debit card, and there are a number of other smaller companies with similar products.

Re: Robinhood reports 43% revenue decline

#72

Post by daniel-cussen »

colinmhayes wrote: post #42
daniel-cussen wrote: post #27

Earlier quoted context omitted.

> robinhood didn't lock trading - or at the very least, they were far from the only brokerage to do so and had very little choice in the matter. So why did you start out saying they didn't lock trading...to then say they did lock trading? Do some people will only read the first fifteen words of your post? Like are you aiming to fill the air with positive-sounding sounds that make Robinhood sound good? You think we do…

I don't think it's fair to say robinhood locked trading here. The brokers increased the amount of collateral needed to buy GME and robinhood didn't have the money. They were unable to buy more GME until their loan came through

That's purely Robinhood's problem. And in fact that's because they weren't actually buying the shares like they said they were, otherwise there would be no problem.

If they locked trading...get this...this is my logic...then it is in fact FAIR to SAY that they locked trading. It's only complex because they were cheating their customers, hence the decline of the platform, hence this chain of posts, hence the end of this sentence having spoken my piece.

Re: Robinhood reports 43% revenue decline

#73

Post by bombcar »

ceeplusplus wrote: post #51
lalos wrote: post #6

Earlier quoted context omitted.

Fidelity iOS app even has a beta toggle that sprinkles that UI/UX competitive advantage that Robinhood pioneered in the space. Anyhow, I wonder how much revenue decline is expected post-IPO, one would assume that they hyper-optimize KPIs 1-2 years before IPO to have good metrics and then those strategies do not continue in the longer term.

I've used Fidelity's new UX, as well as Vanguard's, and both are still way behind Robinhood in terms of just usability, nevermind addictiveness. Robinhood also makes it easy to take on insane amounts of risk through options and margin whereas that kind of leverage is difficult to achieve elsewhere.

Insane amounts of risk and long-term customers don’t usually go together.

Re: Robinhood reports 43% revenue decline

#75

Post by justinsaccount »

thebean11 wrote: post #31
jasode wrote: post #24

Earlier quoted context omitted.

>I have no idea how necessary their actions were It was financially unavoidable for Robinhood because they didn't have the _extra_ billions$ in collateral deposited at the clearinghouse to back up their customers' trades (e.g. GME). Various stories about it having to raise extra billions in an emergency: https://www.google.com/search?q=robinhood+emergency+raise+bi... But retail traders (not the professional traders l…

They had enough money to cover users' trades in securities other than GME, though, right? If I sell GME to buy AMZN, does that have different collateral implications to selling GME to buy GME an hour later? If I send them a bank transfer for $10k, they should have that money as soon as it clears right? There are many other ways they could have handled it beyond halting buying (and buying only) in an individual stock.…

> If I sell GME to buy AMZN, does that have different collateral implications

Yes. Have you ever heard the word "Volatility" ?

AMZN is not going to go from 2500 to 25000 back to 2500 in the span of a week.

Re: Robinhood reports 43% revenue decline

#76

Post by kareemsabri »

dragontamer wrote: post #66
dangerlibrary wrote: post #64

Earlier quoted context omitted.

"Not being able to transact GME" is one thing, but they disabled the ability to buy, and kept the ability to sell. It wasn't a symmetric freeze - it was a deliberate action that could only have one outcome on the stock price. It doesn't matter what the reason is - underfunded collateral or otherwise. The experience they provided to their customers was "you can only sell this stock, nobody can buy it." That's not thei…

> "Not being able to transact GME" is one thing, but they disabled the ability to buy, and kept the ability to sell. It wasn't a symmetric freeze - it was a deliberate action that could only have one outcome on the stock price. Because Robinhood didn't have enough margin to keep buying GME. But if you sold GME, that reduced the margin Robinhood had to keep. ------- In other words: Robinhood has no more money to buy G…

This is another way of saying Robinhood did not have the capital reserves required to fulfill their obligations as a broker-dealer to their customers.

Also, it is not correct that they "didn't have enough money to buy GME". Restricting trading of GME was a choice they made to post less collateral, which they didn't have.

Re: Robinhood reports 43% revenue decline

#77

Post by [deleted] »

dangerlibrary wrote: post #68
dragontamer wrote: post #66

Earlier quoted context omitted.

> "Not being able to transact GME" is one thing, but they disabled the ability to buy, and kept the ability to sell. It wasn't a symmetric freeze - it was a deliberate action that could only have one outcome on the stock price. Because Robinhood didn't have enough margin to keep buying GME. But if you sold GME, that reduced the margin Robinhood had to keep. ------- In other words: Robinhood has no more money to buy G…

I'm not confused why they did what they did. I understand the situation they were in. I'm saying they shouldn't have done it, and that there is an obvious conflict of interest when there's a short squeeze on hedge funds going on, and Robin Hood's paying customers are hedge funds. Stock freezes happen. They are, all things considered, fairly routine affairs. This was not a stock freeze - it was a company that got out…

[deleted]

Re: Robinhood reports 43% revenue decline

#78

Post by bidirectional »

dangerlibrary wrote: post #68
dragontamer wrote: post #66

Earlier quoted context omitted.

> "Not being able to transact GME" is one thing, but they disabled the ability to buy, and kept the ability to sell. It wasn't a symmetric freeze - it was a deliberate action that could only have one outcome on the stock price. Because Robinhood didn't have enough margin to keep buying GME. But if you sold GME, that reduced the margin Robinhood had to keep. ------- In other words: Robinhood has no more money to buy G…

I'm not confused why they did what they did. I understand the situation they were in. I'm saying they shouldn't have done it, and that there is an obvious conflict of interest when there's a short squeeze on hedge funds going on, and Robin Hood's paying customers are hedge funds. Stock freezes happen. They are, all things considered, fairly routine affairs. This was not a stock freeze - it was a company that got out…

They only did what they were forced to. Making an active choice to arbitrarily restrict selling as well would have been an insane move -- who are they to tell their customers they cannot sell something they own?

Re: Robinhood reports 43% revenue decline

#79

Post by itronitron »

jasode wrote: post #24
ryanmcbride wrote: post #2

I feel like regardless of the reasons they did it, whether or not it was necessary, they lost a lot of good faith with the users when they locked the GME and crypto trading during that whole thing. I have no idea how necessary their actions were but regardless of its necessity it still cost a lot of user good will.

>I have no idea how necessary their actions were It was financially unavoidable for Robinhood because they didn't have the _extra_ billions$ in collateral deposited at the clearinghouse to back up their customers' trades (e.g. GME). Various stories about it having to raise extra billions in an emergency: https://www.google.com/search?q=robinhood+emergency+raise+bi... But retail traders (not the professional traders l…

Doesn't the customers' money in their account provide the collateral for the trade?
Post reply on HN