Robinhood Markets Inc. plans to cut its staff by 23%, citing the weakening economic environment and depressed trading activity.

Chief Executive Vlad Tenov publicly announced the layoffs in a Tuesday afternoon blog post, acknowledging that his prior plan to let go of 9% of the Robinhood HOOD, +11.76% workforce while engaging in “greater cost discipline,” which was announced in April, “did not go far enough.”

“Since that time, we have seen additional deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash,” Tenov said. “This has further reduced customer trading activity and assets under custody.”

Shares of the company were off 0.7% in after-hours trading Tuesday.

Tenov said in the post that Robinhood “staffed many of our operations functions under the assumption that the heightened retail engagement we had been seeing with the stock and crypto markets in the COVID era would persist into 2022,” and that the company now has “more staffing than appropriate.”

The layoffs are expected to impact employees in all functions, but mostly those in operations, marketing and program management. The blog post came after a companywide meeting and indicated that staffers would learn of their status via email and Slack “immediately” after that meeting so that employees “don’t have to wait for clarity.”

“As CEO, I approved and took responsibility for our ambitious staffing trajectory – this is on me,” Tenov said.

Robinhood’s announcement follows Coinbase Global Inc.’s COIN, +20.48% move earlier this year to institute a hiring freeze and rescind some accepted job offers. E-commerce company Shopify Inc. announced its own round of layoffs last week, with the CEO admitting that the company hired based on booming pandemic-era growth trends that had since waned.

Also on Tuesday, Robinhood reported second-quarter financial results, which arrived a day earlier than scheduled.

Source: MarketWatch

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