Robinhood reported a net loss of $1.32 billion then the stock tanked below IPO Price

Robinhood stocks is suffering lately as the company reported a net loss of $1.32 billion and warned that more trading headwind is ahead. As a result, Robinhood stocks Hood fell by as much as 10 percent taking it below the IPO price of $38 per share. A share of HOOD stock is now trading at $35.55 and it may get worse. 

In the recent reports, Robinhood blamed the slowed down in Crypto trading as the reason for the poor performance this quarter.

The second quarter was “one of those idiosyncratic market events where there’s this massive interest specifically in Doge,” Robinhood CFO Jason Warnick told CNBC. “We love it when those moments happen. It’s a great way to bring a lot of new customers onto the platform but we’re really thinking about investing in crypto over the long term. It’s gonna be impossible for us to accurately predict...revenue on a quarter-to-quarter basis.”

 Robinhood earning report breakdown. 

• Total net revenues increased 35% to $365 million, compared with $270 million in the third quarter of 2020.

• Transaction-based revenues increased 32% to $267 million, compared with $202 million in the third

quarter of 2020.

◦ Options increased 29% to $164 million, compared with $127 million in the third quarter of 2020.

◦ Cryptocurrencies increased 860% to $51 million, compared to $5 million in the third quarter of 2020.

◦ Equities decreased 27% to $50 million, compared with $69 million in the third quarter of 2020.

• Loss before income tax was $1.37 billion, compared with loss before income tax of $11 million in the third

quarter of 2020. Share-based compensation expense totaled $1.24 billion in the third quarter of 2021 of

which $1.01 billion was recognized upon our IPO.

• Net loss was $1.32 billion, or $2.06 per diluted share, compared with net loss of $11 million, or $0.05 per

diluted share in the third quarter of 2020.

• Adjusted EBITDA (non-GAAP) was negative $84 million, compared with positive $59 million in the third

quarter of 2020.

• Net Cumulative Funded Accounts increased 97% to 22.4 million, compared with 11.4 million in the third

quarter of 2020.

• Monthly Active Users (MAU) increased 76% to 18.9 million, compared with 10.7 million in the third quarter

of 2020.

• Assets Under Custody (AUC) increased 115% to $95 billion, compared with $44 billion in the third quarter

of 2020.

• Average Revenues Per User (ARPU) decreased 36% to $65, compared with $102 in the third quarter of

2020.

• Crypto activity declined from record highs in the prior quarter, leading to considerably fewer new funded

accounts, a slight decline in Net Cumulative Funded Accounts, and lower revenue in the third quarter of

2021 compared with the second quarter of 2021.