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(HOOD) CEO Vlad Tenev introduced Tuesday afternoon that the net buying and selling platform will lay off 9% of its workforce as shares of the corporate’s inventory hit a brand new low.

In a blogpost, Tenev wrote that Robinhood’s monetary place was sturdy, with over $6 billion in money on its stability sheet. The layoffs, he mentioned, comply with a interval of maximum headcount progress that “led to some duplicate roles and job features, and extra layers and complexity than are optimum.”

Robinhood has elevated its workers from 700 to three,800 staff because the starting of 2020.

“After fastidiously contemplating all these elements, we decided that making these reductions to Robinhood’s workers is the fitting choice to enhance effectivity, improve our velocity, and be sure that we’re aware of the altering wants of our clients,” mentioned Tenev.

Going ahead, the corporate will “proceed to prioritize inner alternatives for automation and operational effectivity,” Tenev wrote.

Shares of the inventory closed at $10 on Tuesday, the bottom value because the firm went public final July.

Robinhood IPO’d at $38 per share and shortly soared to $85 however has since plummeted. Shares are down 46% up to now in 2022, whereas the S&P 500 has fallen 13%.

The corporate performed a key function within the early 2021 surge in meme shares like GameStop that retail traders, armed with stimulus checks and elevated unemployment funds, poured into. However the surge was quick lived, and Robinhood reported a loss in month-to-month energetic customers final quarter.

Early in April, Goldman Sachs downgraded the corporate to a promote from impartial, citing headwinds as traders disengage on account of falling markets and waning Covid stimulus checks.

“We imagine HOOD might proceed to see increased ranges of churn as these traders leverage their smaller greenback account sizes for on a regular basis spending,” Goldman analysts wrote.

Robinhood tends to enchantment to new traders, with common account sizes round $4,000. The common age of its customers is 31, and about 50% of these are first-time traders, the corporate has mentioned, making it extra vulnerable to consumer drop-off throughout financial slowdowns.

Goldman doesn’t see a transparent path towards profitability for Robinhood, a foul signal as traders change into more and more skeptical of unprofitable fintech corporations.

Robinhood is scheduled to launch its first-quarter outcomes after the bell Thursday, however Tuesday’s weblog publish made no point out of them. For its final quarter, the corporate posted a $423 million web loss.

Shares of the inventory have been down 5.5% in after-hours buying and selling.

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