Robinhood Revenues Breakdown

Business / By / April 13, 2022
Revenues breakdown2021
Transaction-based revenues$1.4 Billion
Net interest revenues$257 Million
Other revenues$155.9 Million
Total Revenues$1.81 Billion
Net Losses$-3.68 Billion
In 2021, Robinhood generated $1.81 billion in revenues. Most of them came through transaction-baseds revenues, for $1.4 billion. While the remaining part was net interest revenues, for $257 million, and other revenues for $155.9 million. Transaction-based revenues are revenues that Robinhood makes mostly in the form of payment-for-order-flow. In short, the company facilitates the liquidity in the marketplace, thus getting fees for that, from market makers.
Transaction-based revenues breakdown2021%
Options688,89949%
Cryptocurrencies419,38230%
Equities287,73421%
Other6,3350.5%
Total1,402,35077.26%
Of the transaction-based revenues, most of them came from options and cryptocurrencies. Transaction-based revenues for options generated almost $689 million revenue or 49% of the total transaction revenues. While cryptocurrencies-based revenues generated $419 million in revenue, about 30% of the total transaction-based revenues. Within cryptocurrencies, most of the revenues were generated, in 2021, by the intermediation of DOGE. The rest were equities.
Key Facts
FoundersVladimir Tenev & Baiju Bhatt
Year FoundedApril 18, 2013
Year of IPO7/28/2021
IPO Price$38.00
Total Revenues at IPO$958 Million
Total Revenues in 2021$1.4 Billion
Employees3,800 full-time employees as of December 2021
Revenues per Employee$369,039.47
Founded by Vladimir Tenev & Baiju Bhatt, on April 18, 2013, Robinhood IPOed on July 2021, at a $38 price per share, with total revenues at IPO of $958 million. In 2021, the company had 3,800 full-time employees and it generated $369,039.47 per employee.
how-does-robinhood-make-money
Robinhood is an app that gamifies investing in stocks, ETFs, options, and cryptocurrencies, all commission-free. While the app is commission-free Robinhood made $1.81 billion in total revenues in 2021, primarily based on transaction-based revenue which represented over 77% ($1.4 billion) of the company’s overall revenues. Transaction-based revenues primarily include payment for order flow from routing customer orders for options, cryptocurrencies, and equities to market makers.
payment-for-order-flow
Payment for order flow consists of a “kickback” or commission that the broker routing customers to a market maker (in charge of enabling the bid and ask price) will pay a commission to the broker as a sort of market-making fee.
meme-investing
Meme stocks are securities that go viral online and attract the attention of the younger generation of retail investors. Meme investing, therefore, is a bottom-up, community-driven approach to investing that positions itself as the antonym to Wall Street investing. Also, meme investing often looks at attractive opportunities with lower liquidity that might be easier to overtake, thus enabling wide speculation, as “meme investors” often look for disproportionate short-term returns.

Read Next: How Does Robinhood Make Money, Robinhood Business Model

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Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
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