Following a disappointing earnings report from the freshly public brokerage, Robinhood’s stock plummeted on Wednesday.
Robinhood’s stock dropped 10.4% to $35.44 per share at the end of the day, falling below the stock trading app’s IPO price of $38 per share.
The drop came after Robinhood’s third-quarter earnings underperformed on both the top and bottom lines. Robinhood made $51 million in revenue in the third quarter of 2021, compared to $233 million the previous quarter.
A slowdown in crypto trading weighed down revenue, and Robinhood warned that the trade challenges would last until the end of the year. The exchange ascribed the sharp drop to a drop in the price of Dogecoin, the meme-based cryptocurrency whose meteoric rise in popularity earlier this year boosted user sign-ups.
Robinhood announced a $1.32 billion net loss, or $2.06 per share. On Wall Street, a loss of $1.37 per share was expected. The company’s user growth has also slowed. The number of monthly active users fell to 18.9 million in the third quarter, down from 21.3 million in the second. Market volatility, retail trading behavior, and unforeseen market occurrences have all had an influence on Robinhood’s business, and this is expected to continue in the next quarter.