Alternative brokerage offers subdued fourth-quarter guidance.

Robinhood posted a wider-than-expected quarterly loss after the bell Tuesday, as the company saw fewer new accounts amid a slowdown in activity related to cryptocurrencies.

The alternative brokerage said it lost $2.06 a share on revenue of $365 million, vs. a loss of 5 cents a share on revenue of $270 million in the same period a year ago. Analysts surveyed by FactSet had been expecting a loss of 67 cents a share for the period.

“Crypto activity declined from record highs in the prior quarter, leading to considerably fewer new funded accounts,” the company said in a statement.

The company offered subdued guidance for the fourth quarter.

Shares of Robinhood  (HOOD) – Get Robinhood Report fell sharply on the report. The stock lost $3.35, or 8.47%, to $36.22 in after-hours trading.

“For the three months ending Dec. 31, 2021, we anticipate that many of the factors that impacted our third-quarter results, such as seasonal headwinds and lower retail trading activity, may persist. In the absence of any changes to the market environment or exogenous events, we believe this may result in quarterly revenues no greater than $325 million and full year revenue of less than $1.8 billion.”

The company said that in addition, “we expect new funded accounts for the fourth quarter will be roughly in line with the 660,000 opened in the third quarter of 2021.”

Robinhood was one of several tech companies reporting this week that money manager Cathie Wood’s Ark Investment Management bought shares in Monday, according to a published report.

The Robinhood trading platform was at the heart of the so-called meme stock mania at the beginning of the year that saw heavily shorted names promoted online in attempts to coordinate short squeezes.

Original Article – The Street


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