Robinhood shares fell after losing active users

Robinhood presented a down revenue forecast as its latest earnings report showed a decrease in its active users.

On Thursday, stock-trading app Robinhood delivered a down revenue forecast for the first quarter of this year. Its latest earnings report showed that the number of its active users started to decline.

In after-hours trading, shares of Robinhood fell as much as 15%. The newly public brokerage expects first-quarter revenue of less than $345 million, down 36% compared with 2021. According to FactSet, Wall Street’s consensus estimate was $448.3 million in revenue for the first quarter.

Monthly active users dropped to 17.4 million last quarter from 18.8 million in the third quarter. This number was also below calculations of 19.9 million, according to FactSet.

In the meantime, net cumulative funded accounts summed 22.8 million at the end of Q4. This result is up from 22.3 million accounts in the third quarter. Robinhood added 10 million accounts only last year.

Overview of Robinhood shares and revenue

Robinhood reported a net loss of $424 million for the fourth quarter. It equals a 48 cent loss per cut share, more extensive than the 45 cent loss estimation collected by Refinitiv. However, Robinhood broadcasted $364 million in revenue in the final quarter of 2021. It appeared slightly above analysts’ expectations of $362.2 million.

Robinhood soon will face its most challenging comps in the first and second quarters of this year. It will happen after its record year in 2021 from events such as the GameStop short squeeze.

Robinhood’s stock is more than 87% off its most recent high since the public trading debut in July 2021. Currently, shares are down more than 35% in January, bringing its market capitalization to less than $11 billion. The company said in a release that it had set goals to start opening its crypto platform for international customers in 2022.