Robinhood Markets, Inc. (“Robinhood”) (NASDAQ: HOOD) today
announced financial results for the fourth quarter and full year
ended December 31, 2021.
- Total
net revenues for the quarter increased 14% to $363
million, compared with $318 million in the fourth quarter of 2020,
and for the year increased 89% to $1.82 billion, compared with $959
million for the year ended December 31, 2020.
-
Transaction-based revenues for the quarter
increased 12% to $264 million, compared with $235 million in the
fourth quarter of 2020, and for the year increased 95% to $1.40
billion, compared with $720 million for the year ended December 31,
2020.
- Options for the
quarter increased 14% to $163 million, compared with
$142 million in the fourth quarter of 2020, and for the year
increased 57% to $689 million, compared with $440 million for the
year ended December 31, 2020.
- Cryptocurrencies
for the quarter increased 304% to $48 million, compared to
$12 million in the fourth quarter of 2020, and for the year
increased to $419 million, compared with $27 million for
the year ended December 31, 2020.
- Equities for the
quarter decreased 35% to $52 million, compared with
$80 million in the fourth quarter of 2020, and for the year
increased 15% to $288 million, compared with $251 million
for the year ended December 31, 2020.
- Loss before income
tax for the quarter was $420 million, compared with income
before income tax of $19 million in the fourth quarter of
2020, and for the year loss before income tax was $3.68 billion,
compared with income before income tax of $14 million for the
year ended December 31, 2020.
- Share-based compensation expense
totaled $318 million for the fourth quarter of 2021 and
$1.57 billion for the year ended December 31, 2021. For the
year ended December 31, 2020, share-based compensation expense
totaled $24 million, all related to stock options (no expense
relating to restricted stock units was recognized because our
initial public offering ("IPO") had not yet occurred).
- The loss before income tax for the
year ended December 31, 2021 also included total expense of
$2.05 billion associated with the change in fair value of
convertible notes and warrant liability issued in February
2021.
- Net
loss for the quarter was $423 million, or $0.49 per
diluted share, compared with net income of $13 million, or
$0.02 per diluted share in the fourth quarter of 2020, and for the
year net loss was $3.69 billion, or $7.49 per diluted share,
compared with net income of $7 million, or $0.01 per diluted share,
for the year ended December 31, 2020.
- Adjusted
EBITDA (non-GAAP) for the quarter was negative $87
million, compared with positive $79 million in the fourth
quarter of 2020, and for the year was positive $34 million,
compared with positive $155 million for the year ended
December 31, 2020.
- Net
Cumulative Funded Accounts increased 81% to 22.7 million
as of December 31, 2021, compared with 12.5 million as of December
31, 2020. On a sequential basis, Net Cumulative Funded Accounts
increased 1% compared with 22.4 million as of September 30,
2021.
- Monthly
Active Users (MAU) increased 48% to 17.3 million for
December 2021, compared with 11.7 million for December 2020.
On a sequential basis, MAU decreased 8% compared with
18.9 million for September 2021.
- Assets Under Custody
(AUC) increased 56% to $98 billion as of December 31,
2021, compared with $63 billion as of December 31, 2020. On a
sequential basis, AUC increased 3% compared with $95 billion
as of September 30, 2021.
- Average Revenues Per User
(ARPU) for the quarter decreased 39% to $64 on an
annualized basis, compared with $106 in the fourth quarter of 2020.
The decrease was primarily related to lower trading volumes per
user for options and equities and lower interest earnings per user
from securities lending due to declines in market rates earned on
loaned securities, partially offset by higher trading volumes per
user for cryptocurrencies. ARPU for the year decreased 5% to $103,
compared with $109 for the year ended December 31, 2020. On a
sequential basis, ARPU remained consistent compared with the
quarter ended September 30, 2021.
- Cash and cash
equivalents at December 31, 2021 totaled $6.3 billion,
compared with $1.4 billion at December 31, 2020.
“We had a momentous year, nearly doubling the
number of customers on the platform and making critical investments
in our team and infrastructure to support growth,” said Vlad Tenev,
CEO and Co-Founder of Robinhood Markets. “This year, we'll expand
our ecosystem of products that make Robinhood the best place to
start investing and build wealth for the long term."
Highlights
Robinhood’s 2021 investments put the company on
strong footing for 2022
- In 2021 Robinhood added over 10
million net funded accounts, nearly doubling the customers on the
platform. In the same time, the company has more than doubled its
team, adding talent to important areas like engineering, product,
customer service, and compliance.
- Robinhood also made strong
executive additions over the past year and is excited to have most
recently welcomed Steve Quirk as Chief Brokerage Officer and a
member of the senior leadership team.
- The company has invested heavily in
the service and reliability of its platform to meet the demands
created by tremendous user growth and successfully added 24/7 live
phone support for all logged-in users, giving customers the ability
to get phone support at any time and on any topic.
- Robinhood has continued to improve
the product experience, adding contextual in-app education, rolling
out Crypto Gifts and recurring investments, opening up access to
IPOs, and giving customers a voice with the companies they invest
in through the acquisition of Say Technologies and the integration
of its Q&A platform into the Robinhood app.
Robinhood delivers on product development in Q4
2021
- Robinhood introduced first trade
recommendations to all new customers who have yet to place a trade,
helping users get started with a diversified ETF portfolio based on
their risk profile and investment objectives.
- Robinhood launched Automated
Customer Account Transfer Service ("ACATS") In a few weeks ago to a
small set of customers and has been gradually expanding its
availability, with early results looking promising. This feature
allows customers to transfer assets from other brokerages into
Robinhood and the company will continue to improve the experience
and expand the availability to all customers in Q1 2022.
- Robinhood continued to improve its
options experience for customers, introducing Options Alerts,
Options Watchlist and making it simpler to roll option
contracts.
- Robinhood made considerable
progress on its fully-paid securities lending program, continues to
discuss with its regulators, and believes it will be able to launch
the program during the first half of the year.
- Robinhood is close to delivering an
even larger window of available trading hours and expects to roll
this out later in Q1 2022. This will be one of several improvements
the company plans to make to the trading experience this year.
- Robinhood successfully completed
alpha testing on Crypto Wallets and has launched a public beta,
which will continue to provide valuable insights as the company
prepares for a full launch of wallets in Q1 2022.
- During the holiday season,
Robinhood launched Crypto Gifts, which enables customers to send
crypto to family and friends. The company will take learnings from
this launch and look to apply them to transfer capabilities beyond
crypto.
Robinhood charts ambitious plan for 2022
- Robinhood's plan is focused on
three core areas: being the best place to get started investing,
helping first time investors grow into long-term investors, and
continuing to serve advanced investors with the power and
simplicity they need.
- Robinhood will build products
intended to help with long-term investing, aiming to make it easier
for customers to build for their futures no matter where they are
in their financial journeys. Teams are already hard at work
developing tax-advantaged retirement accounts, which will begin
rolling out to customers mid-year.
- Robinhood will invest in spending
and savings products and, in the coming months, will introduce a
new experience for day-to-day spending to help customers build a
portfolio as an outcome of spending.
- Robinhood plans to offer customers
ways to move their money faster, starting with introducing instant
debit card deposits and withdrawals in the next few months.
- Robinhood has set aggressive goals
to start opening its crypto platform up to customers
internationally in 2022. The company believes in the immense
potential of the crypto economy and sees a big opportunity in
serving customers across the globe.
Financial Outlook
For the first quarter of 2022, Robinhood
anticipates that total net revenues will be less than $340 million,
which assumes some incremental improvement in trading volumes
versus what we have seen so far. At the top end, this implies a
year-over-year revenue decline of 35% compared to the first quarter
of 2021, during which we saw outsized revenue performance due to
heightened trading activity, particularly relating to certain
meme-stocks.
Actual results for total net revenues might
differ materially from our outlook. Total net revenues are highly
sensitive to the number and timing of new funded accounts, the
number of trades made by our customers, the notional amount of
trading volume per customer, and market environment or other
exogenous events, all of which are affected by general market
conditions, consumer sentiment, and other factors.
For fiscal year 2022, Robinhood expects total
operating expenses, excluding share-based compensation, to increase
15-20% year-over-year. Additionally, we expect share-based
compensation to decline 35-40% year-over-year.
Actual results for total operating expenses,
excluding share-based compensation, might differ materially from
our outlook due to several factors, including the rate of growth in
net new funded accounts which affects several costs including
variable marketing costs, the degree to which we are successful in
preventing fraud, our ability to manage web-hosting expenses
efficiently, and our ability to achieve productivity improvements
in customer service, among other factors.
Webcast and Conference Call
Information
Robinhood will host a conference call to discuss
its results and financial outlook at 2 p.m. PT / 5 p.m. ET today,
January 27, 2022. The live webcast of Robinhood's earnings
conference call can be accessed at investors.robinhood.com, along
with the earnings press release and accompanying slide
presentation.
Following the call, a replay and transcript will
also be available at the same website.
About Robinhood
Robinhood Markets is on a mission to democratize
finance for all. With Robinhood, people can invest with no account
minimums through Robinhood Financial, LLC, buy and sell crypto
through Robinhood Crypto, LLC, and learn about investing through
easy-to-understand educational content.
Robinhood intends to use its blog, Under the
Hood, as a means of disclosing material information to the public
in a broad, non-exclusionary manner for purposes of the SEC’s
Regulation Fair Disclosure (Reg. FD). Under the Hood can be
accessed at blog.robinhood.com and investors should routinely
monitor that website, in addition to Robinhood’s press releases,
SEC filings, and public conference calls and webcasts, as
information posted on Robinhood’s blog could be deemed to be
material information.
"Robinhood" and the Robinhood feather logo are
registered trademarks of Robinhood Markets, Inc. All other names
are trademarks and/or registered trademarks of their respective
owners.
Contacts
Investors:Irvin Shair@robinhood.com
Press:press@robinhood.com
Cautionary Note Regarding
Forward-Looking Statements
This press release contains forward-looking
statements regarding the expected financial performance of
Robinhood Markets, Inc. and its consolidated subsidiaries (“we,”
“Robinhood,” or the “Company”) and our strategic and operational
plans, including our expectations for Crypto Wallets, ACATS In, a
fully-paid securities lending program, and extended trading hours,
our statements under the heading “Robinhood charts ambitious plan
for 2022,” and our statements under the heading “Financial
Outlook," among others. Our forward-looking statements are subject
to a number of known and unknown risks, uncertainties, assumptions,
and other factors that may cause our actual future results,
performance, or achievements to differ materially from any future
results expressed or implied in this press release. Reported
results should not be considered an indication of future
performance. Factors that contribute to the uncertain nature of our
forward-looking statements include, among others: our limited
operating history; the difficulty of managing rapid growth and the
risk of declining or negative growth; the fluctuations in our
financial results and key metrics from quarter to quarter; our
reliance on transaction-based revenue, including payment for order
flow (“PFOF”), and the risk of new regulation or bans on PFOF and
similar practices; the difficulty of raising additional capital (to
satisfy any liquidity needs and support business growth and
objectives) on reasonable terms or at all; the need to maintain
capital levels required by regulators and self-regulatory
organizations; the risk that we might mishandle the cash,
securities, and cryptocurrencies we hold on behalf of customers,
and our exposure to liability for operational errors in clearing
functions; the impact of negative publicity on our brand and
reputation; the risk that changes in business, economic, or
political conditions, or systemic market events, might harm our
business; our dependence on key employees and a skilled workforce;
the difficulty of complying with an extensive and complex
regulatory environment and the need to adjust our business model in
response to new or modified laws and regulations; the possibility
of adverse developments in pending litigation and regulatory
investigations; the effects of competition; our need to innovate
and invest in new products and services in order to attract and
retain customers and deepen their engagement with us in order to
maintain growth; our reliance on third parties to perform certain
key functions and the risk that operational or technological
failures could impair the availability or stability of our
platform; the risk of cybersecurity incidents, theft, data
breaches, and other online attacks; the difficulty of processing
customer data in compliance with privacy laws; our need as a
regulated financial services company to develop and maintain
effective compliance and risk management infrastructures; the
volatility of cryptocurrency prices and trading volumes; and the
risk that substantial future sales of Class A common shares in the
public market could cause the price of our stock to fall. Because
some of these risks and uncertainties cannot be predicted or
quantified and some are beyond our control, you should not rely on
our forward-looking statements as predictions of future events.
More information about potential risks and uncertainties that could
affect our business and financial results is included in Part II,
Item 1A of our Quarterly Report on Form 10-Q for the quarter ended
September 30, 2021 as well as our other filings with the Securities
and Exchange Commission (“SEC”), which are available on the SEC’s
web site at www.sec.gov. Moreover, we operate in a very competitive
and rapidly changing environment; new risks and uncertainties may
emerge from time to time, and it is not possible for us to predict
all risks nor identify all uncertainties. The events and
circumstances reflected in our forward-looking statements might not
be achieved and actual results could differ materially from those
projected in the forward-looking statements. Except as otherwise
noted, all forward-looking statements are made as of the date of
this press release, January 27, 2022, and are based on
information and estimates available to us at this time. Although we
believe that the expectations reflected in our forward-looking
statements are reasonable, we cannot guarantee future results,
performance, or achievements. Except as required by law, Robinhood
assumes no obligation to update any of the statements in this press
release whether as a result of any new information, future events,
changed circumstances, or otherwise. You should read this press
release with the understanding that our actual future results,
performance, events, and circumstances might be materially
different from what we expect. All fourth quarter and full year
2021 financial information in this press release is preliminary,
based on our estimates and subject to completion of our financial
closing procedures. Final results for the full year, which will be
reported in our Annual Report on Form 10-K for the year ended
December 31, 2021, might vary from the information in this press
release. In particular, until our financial statements are issued
in our Annual Report on Form 10-K, we might be required to
recognize certain subsequent events (such as in connection with
contingencies or the realization of assets) which could affect our
final results.
Non-GAAP Financial Measures
We collect and analyze operating and financial
data to evaluate the health of our business, allocate our resources
and assess our performance. In addition to total net revenues, net
income (loss) and other results under GAAP, we utilize non-GAAP
calculations of adjusted earnings before interest, taxes,
depreciation and amortization (“Adjusted EBITDA”) and operating
expense excluding share-based compensation. This non-GAAP financial
information is presented for supplemental informational purposes
only, should not be considered a substitute for or superior to
financial information presented in accordance with GAAP and may be
different from similarly titled non-GAAP measures used by other
companies. Reconciliations of these non-GAAP measures to the most
directly comparable financial measures calculated and presented in
accordance with GAAP are provided in the financial tables included
in this release.
Adjusted EBITDA
Adjusted EBITDA is defined as net income (loss),
excluding (i) interest expenses related to credit facilities, (ii)
provision for (benefit from) income taxes, (iii) depreciation and
amortization, (iv) share-based compensation, (v) change in fair
value of convertible notes and warrant liability, (vi) significant
legal and tax settlements and reserves, and (vii) other significant
gains, losses, and expenses (such as impairments, restructuring
charges, and business acquisition- or disposition-related expenses)
that we believe are not indicative of our ongoing results.
The above items are excluded from our Adjusted
EBITDA measure because these items are non-cash in nature, or
because the amount and timing of these items is unpredictable, is
not driven by core results of operations and renders comparisons
with prior periods and competitors less meaningful. We believe
Adjusted EBITDA provides useful information to investors and others
in understanding and evaluating our results of operations, as well
as providing a useful measure for period-to-period comparisons of
our business performance. Moreover, Adjusted EBITDA is a key
measurement used by our management internally to make operating
decisions, including those related to operating expenses, evaluate
performance, and perform strategic planning and annual
budgeting.
Operating Expense excluding Share-Based
Compensation
Operating expense excluding share-based
compensation is defined as the applicable GAAP operating expense
line item minus the share-based compensation (or SBC) included
within such line item. We believe operating expense excluding SBC
provides useful information to investors and others in
understanding and evaluating our results of operations, as well as
providing a useful measure for period-to-period comparisons of our
cost structure.
Key Performance Metrics
In addition to the measures presented in our
unaudited condensed consolidated financial statements, we use the
key performance metrics described below to help us evaluate our
business, identify trends affecting our business, formulate
business plans, and make strategic decisions.
Net Cumulative Funded Accounts
A Robinhood account is designed to provide a
user with access to any and all of the products offered on our
platform. We define “Net Cumulative Funded Accounts” as New Funded
Accounts less Churned Accounts plus Resurrected Accounts (each as
defined below). A “New Funded Account” is a Robinhood account into
which the account user makes an initial deposit or money or asset
transfer, of any amount, during the relevant period. An account is
considered “Churned” if it was ever a New Funded Account and its
balance (measured as the fair value of assets in the account less
any amount due from the user and excluding certain
Company-initiated credits) drops to or below zero for at least 45
consecutive calendar days. Negative balances typically result from
Fraudulent Deposit Transactions (as defined below) and, less often,
from margin loans. An account is considered “Resurrected” in a
stated period if it was a Churned Account as of the end of the
immediately preceding period and its balance (excluding certain
Company-initiated credits) rises above zero. Examples of credits
excluded for purposes of identifying Churned Accounts and
Resurrected Accounts are price correction credits, related interest
adjustments, and fee adjustments.
“Fraudulent Deposit Transactions” occur when
users initiate deposits into their accounts, make trades on our
platform using a short-term extension of credit from us, and then
repatriate or reverse the deposits, resulting in a loss to us of
the credited amount.
Monthly Active Users (“MAU”)
We define MAU as the number of Monthly Active
Users during a specified calendar month. A “Monthly Active User” is
a unique user who makes a debit card transaction, or who
transitions between two different screens on a mobile device or
loads a page in a web browser while logged into their account, at
any point during the relevant month. A user need not satisfy these
conditions on a recurring monthly basis or have a Funded Account to
be included in MAU. Figures in this release reflect MAU for the
last month of each period presented. We utilize MAU to measure how
many customers interact with our products and services during a
given month. MAU does not measure the frequency or duration of the
interaction, but we consider it a useful indicator for engagement.
Additionally, MAUs are positively correlated with, but are not
indicative of the performance of revenue and other key performance
indicators.
Assets Under Custody (“AUC”)
We define AUC as the sum of the fair value of
all equities, options, cryptocurrency and cash held by users in
their accounts, net of receivables from users, as of a stated date
or period end on a trade date basis. Net Deposits and net market
gains drive the change in AUC in any given period. We define “Net
Deposits” as all cash deposits and asset transfers received from
customers net of reversals, customer cash withdrawals, and other
equity and cash amounts transferred out of our platform (including
in connection with debit card transactions and account transfers in
or out of our platform through the ACATS) for a stated period.
Average Revenue Per User (“ARPU”)
We define ARPU as total revenue for a given
period divided by the average of Net Cumulative Funded Accounts on
the last day of that period and the last day of the immediately
preceding period. Figures in this release represent ARPU for the
year or annualized for each three-month period presented, as
applicable.
ROBINHOOD MARKETS,
INC.CONSOLIDATED BALANCE
SHEETS(Unaudited)
|
Year Ended December 31, |
(in thousands, except share and per share data) |
|
2020 |
|
|
|
2021 |
|
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
1,402,629 |
|
|
$ |
6,253,477 |
|
Cash and securities segregated under federal and other
regulations |
|
4,914,660 |
|
|
|
3,992,419 |
|
Receivables from brokers, dealers and clearing organizations |
|
124,501 |
|
|
|
88,326 |
|
Receivables from users, net |
|
3,354,142 |
|
|
|
6,638,900 |
|
Deposits with clearing organizations |
|
225,514 |
|
|
|
327,917 |
|
User-held fractional shares |
|
802,483 |
|
|
|
1,834,479 |
|
Investments |
|
— |
|
|
|
27,189 |
|
Other current assets |
|
48,655 |
|
|
|
120,835 |
|
Total current assets |
|
10,872,584 |
|
|
|
19,283,542 |
|
Property, software and equipment, net |
|
45,834 |
|
|
|
146,419 |
|
Goodwill |
|
— |
|
|
|
100,521 |
|
Intangible assets, net |
|
185 |
|
|
|
34,107 |
|
Restricted cash |
|
7,364 |
|
|
|
23,773 |
|
Other non-current assets |
|
62,507 |
|
|
|
180,817 |
|
Total assets |
$ |
10,988,474 |
|
|
$ |
19,769,179 |
|
Liabilities, mezzanine equity and stockholders’ (deficit)
equity |
|
|
|
Current liabilities: |
|
|
|
Accounts payable and accrued expenses |
$ |
104,649 |
|
|
$ |
252,313 |
|
Payables to users |
|
5,897,242 |
|
|
|
6,475,728 |
|
Securities loaned |
|
1,921,118 |
|
|
|
3,651,035 |
|
Fractional shares repurchase obligation |
|
802,483 |
|
|
|
1,834,479 |
|
Other current liabilities |
|
90,553 |
|
|
|
133,787 |
|
Total current liabilities |
|
8,816,045 |
|
|
|
12,347,342 |
|
Other non-current liabilities |
|
48,012 |
|
|
|
128,745 |
|
Total liabilities |
|
8,864,057 |
|
|
|
12,476,087 |
|
Commitments and contingencies |
|
|
|
Mezzanine equity |
|
|
|
Redeemable convertible preferred stock, $0.0001 par value.
414,033,220 shares authorized, 412,742,897 shares issued and
outstanding with a liquidation preference of $2,191,086 as of
December 31, 2020. No shares authorized, issued, and outstanding as
of December 31, 2021. |
|
2,179,739 |
|
|
|
— |
|
Stockholders’ (deficit) equity: |
|
|
|
Preferred stock, $0.0001 par value. No shares authorized, issued
and outstanding as of December 31, 2020; 210,000,000 shares
authorized and no shares issued and outstanding as of December 31,
2021. |
|
— |
|
|
|
— |
|
Common stock, $0.0001 par value. 777,354,000 shares authorized,
229,031,546 shares issued and outstanding as of December 31, 2020;
no shares authorized, issued and outstanding as of December 31,
2021. |
|
1 |
|
|
|
— |
|
Class A common stock, $0.0001 par value. No shares authorized,
issued and outstanding as of December 31, 2020; 21,000,000,000
shares authorized, 735,957,367 shares issued and outstanding as of
December 31, 2021. |
|
— |
|
|
|
73 |
|
Class B common stock, par value $0.0001. No shares authorized,
issued and outstanding as of December 31, 2020; 700,000,000 shares
authorized, 127,955,246 shares issued and outstanding as of
December 31, 2021. |
|
— |
|
|
|
13 |
|
Class C common stock, par value $0.0001. No shares authorized,
issued and outstanding as of December 31, 2020; 7,000,000,000
shares authorized, no shares issued and outstanding as of December
31, 2021. |
|
— |
|
|
|
— |
|
Additional paid-in capital |
|
134,307 |
|
|
|
11,169,136 |
|
Accumulated other comprehensive income |
|
473 |
|
|
|
405 |
|
Accumulated deficit |
|
(190,103 |
) |
|
|
(3,876,535 |
) |
Total stockholders’ (deficit) equity |
|
(55,322 |
) |
|
|
7,293,092 |
|
Total liabilities, mezzanine equity and stockholders’ (deficit)
equity |
$ |
10,988,474 |
|
|
$ |
19,769,179 |
|
|
|
|
|
|
|
|
|
ROBINHOOD MARKETS,
INC.CONSOLIDATED STATEMENTS OF
OPERATIONS(Unaudited)
(in thousands,
except share and per share data) |
Three Months EndedDecember
31, |
|
% Change |
|
Year EndedDecember 31, |
|
% Change |
|
2020 |
|
|
|
2021 |
|
|
|
|
|
2020 |
|
|
|
2021 |
|
|
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
Transaction-based revenues |
$ |
235,282 |
|
|
$ |
263,947 |
|
|
12 |
% |
|
$ |
720,133 |
|
|
$ |
1,402,350 |
|
|
95 |
% |
Net interest revenues |
|
63,017 |
|
|
|
63,351 |
|
|
1 |
% |
|
|
177,437 |
|
|
|
256,962 |
|
|
45 |
% |
Other revenues |
|
19,243 |
|
|
|
35,415 |
|
|
84 |
% |
|
|
61,263 |
|
|
|
155,831 |
|
|
154 |
% |
Total net revenues |
|
317,542 |
|
|
|
362,713 |
|
|
14 |
% |
|
|
958,833 |
|
|
|
1,815,143 |
|
|
89 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses(1)(2): |
|
|
|
|
|
|
|
|
|
|
|
Brokerage and transaction |
|
30,623 |
|
|
|
29,496 |
|
|
(4)% |
|
|
111,083 |
|
|
|
152,343 |
|
|
37 |
% |
Technology and development |
|
81,963 |
|
|
|
280,420 |
|
|
242 |
% |
|
|
215,630 |
|
|
|
1,232,787 |
|
|
472 |
% |
Operations |
|
44,666 |
|
|
|
97,163 |
|
|
118 |
% |
|
|
137,905 |
|
|
|
373,129 |
|
|
171 |
% |
Marketing |
|
33,221 |
|
|
|
44,069 |
|
|
33 |
% |
|
|
185,741 |
|
|
|
327,369 |
|
|
76 |
% |
General and administrative |
|
107,913 |
|
|
|
332,000 |
|
|
208 |
% |
|
|
294,694 |
|
|
|
1,370,520 |
|
|
365 |
% |
Total operating expenses |
|
298,386 |
|
|
|
783,148 |
|
|
162 |
% |
|
|
945,053 |
|
|
|
3,456,148 |
|
|
266 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of convertible notes and warrant
liability |
|
— |
|
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
2,045,657 |
|
|
NM |
Other income, net |
|
(138 |
) |
|
|
(126 |
) |
|
(9)% |
|
|
(50 |
) |
|
|
(2,230 |
) |
|
NM |
Income (loss) before income tax |
|
19,294 |
|
|
|
(420,309 |
) |
|
NM |
|
|
13,830 |
|
|
|
(3,684,432 |
) |
|
NM |
Provision for income taxes |
|
6,266 |
|
|
|
2,958 |
|
|
(53)% |
|
|
6,381 |
|
|
|
2,000 |
|
|
(69)% |
Net income (loss) |
$ |
13,028 |
|
|
$ |
(423,267 |
) |
|
NM |
|
$ |
7,449 |
|
|
$ |
(3,686,432 |
) |
|
NM |
Net income (loss) attributable to common stockholders: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
4,624 |
|
|
$ |
(423,267 |
) |
|
|
|
$ |
2,848 |
|
|
$ |
(3,686,432 |
) |
|
|
Diluted |
$ |
4,624 |
|
|
$ |
(423,267 |
) |
|
|
|
$ |
2,848 |
|
|
$ |
(3,686,432 |
) |
|
|
Net income (loss) per share attributable to common
stockholders: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
$ |
0.02 |
|
|
$ |
(0.49 |
) |
|
|
|
$ |
0.01 |
|
|
$ |
(7.49 |
) |
|
|
Diluted |
$ |
0.02 |
|
|
$ |
(0.49 |
) |
|
|
|
$ |
0.01 |
|
|
$ |
(7.49 |
) |
|
|
Weighted-average shares used to compute net income (loss) per share
attributable to common stockholders: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
227,115,364 |
|
|
|
859,932,743 |
|
|
|
|
|
225,748,355 |
|
|
|
492,381,190 |
|
|
|
Diluted |
|
245,008,423 |
|
|
|
859,932,743 |
|
|
|
|
|
244,997,388 |
|
|
|
492,381,190 |
|
|
|
________________ |
(1) |
The following table presents operating expenses as a percent of
total net revenues: |
|
|
|
Three Months EndedDecember
31, |
|
Year EndedDecember 31, |
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
2021 |
|
Brokerage and transaction |
10 |
% |
|
8 |
% |
|
12 |
% |
|
8 |
% |
Technology and development |
26 |
% |
|
77 |
% |
|
22 |
% |
|
68 |
% |
Operations |
14 |
% |
|
27 |
% |
|
14 |
% |
|
21 |
% |
Marketing |
10 |
% |
|
12 |
% |
|
19 |
% |
|
18 |
% |
General and administrative |
34 |
% |
|
92 |
% |
|
31 |
% |
|
76 |
% |
Total operating expenses |
94 |
% |
|
216 |
% |
|
98 |
% |
|
191 |
% |
________________ |
(2) |
The following table presents the share-based compensation in our
unaudited condensed consolidated statements of operations for the
periods indicated: |
|
|
|
Three Months EndedDecember
31, |
|
Year EndedDecember 31, |
(in thousands) |
|
2020 |
|
|
2021 |
|
|
2020 |
|
|
2021 |
Brokerage and transaction |
$ |
209 |
|
$ |
1,110 |
|
$ |
227 |
|
$ |
7,527 |
Technology and development |
|
14,492 |
|
|
104,534 |
|
|
18,024 |
|
|
609,307 |
Operations |
|
38 |
|
|
3,845 |
|
|
61 |
|
|
20,261 |
Marketing |
|
558 |
|
|
8,687 |
|
|
613 |
|
|
49,731 |
General and administrative |
|
3,685 |
|
|
199,629 |
|
|
5,405 |
|
|
885,427 |
Total share-based compensation expense |
$ |
18,982 |
|
$ |
317,805 |
|
$ |
24,330 |
|
$ |
1,572,253 |
|
|
|
|
|
|
|
|
|
|
|
|
The 2020 amounts exclude the effect of
share-based compensation for awards with performance-based
conditions because the qualifying event, such as our IPO, had not
occurred and, therefore, could not be considered probable. Upon our
IPO in the third quarter of 2021, we recognized $1.01 billion of
share-based compensation.
ROBINHOOD MARKETS,
INC.CONSOLIDATED STATEMENTS OF CASH
FLOWS(Unaudited)
|
Three Months EndedDecember 31, |
|
Year Ended December 31, |
(in thousands) |
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
Operating activities: |
|
|
|
|
|
|
|
Net income (loss) |
$ |
13,028 |
|
|
$ |
(423,267 |
) |
|
$ |
7,449 |
|
|
$ |
(3,686,432 |
) |
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities: |
|
|
|
|
|
|
|
Depreciation and amortization |
|
3,366 |
|
|
|
9,761 |
|
|
|
9,938 |
|
|
|
25,495 |
|
Provision for credit losses |
|
14,795 |
|
|
|
17,532 |
|
|
|
59,134 |
|
|
|
79,328 |
|
Share-based compensation |
|
18,982 |
|
|
|
317,802 |
|
|
|
24,330 |
|
|
|
1,570,386 |
|
Change in fair value of convertible notes and warrant
liability |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,045,657 |
|
Other |
|
(204 |
) |
|
|
12 |
|
|
|
2,139 |
|
|
|
(109 |
) |
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
Segregated securities under federal and other regulations |
|
(129,995 |
) |
|
|
50,000 |
|
|
|
(134,994 |
) |
|
|
134,994 |
|
Receivables from brokers, dealers and clearing organizations |
|
(41,078 |
) |
|
|
36,636 |
|
|
|
(103,787 |
) |
|
|
36,175 |
|
Receivables from users, net |
|
(1,109,169 |
) |
|
|
(557,831 |
) |
|
|
(2,771,967 |
) |
|
|
(3,362,863 |
) |
Deposits with clearing organizations |
|
18,778 |
|
|
|
(11,696 |
) |
|
|
(103,037 |
) |
|
|
(102,403 |
) |
Other current and non-current assets |
|
(21,805 |
) |
|
|
39,730 |
|
|
|
(46,055 |
) |
|
|
(189,004 |
) |
Accounts payable and accrued expenses |
|
(42,281 |
) |
|
|
15,630 |
|
|
|
67,117 |
|
|
|
134,090 |
|
Payables to users |
|
802,448 |
|
|
|
(335,441 |
) |
|
|
3,532,091 |
|
|
|
578,486 |
|
Securities loaned |
|
759,185 |
|
|
|
521,385 |
|
|
|
1,247,089 |
|
|
|
1,729,917 |
|
Other current and non-current liabilities |
|
60,656 |
|
|
|
44,115 |
|
|
|
86,807 |
|
|
|
121,510 |
|
Net cash provided by (used in) operating activities |
|
346,706 |
|
|
|
(275,632 |
) |
|
|
1,876,254 |
|
|
|
(884,773 |
) |
Investing activities: |
|
|
|
|
|
|
|
Purchase of property, software and equipment |
|
(6,861 |
) |
|
|
(17,075 |
) |
|
|
(24,443 |
) |
|
|
(63,182 |
) |
Capitalization of internally developed software |
|
(2,179 |
) |
|
|
(7,852 |
) |
|
|
(7,887 |
) |
|
|
(20,471 |
) |
Acquisitions of a business, net of cash acquired |
|
— |
|
|
|
(6,265 |
) |
|
|
— |
|
|
|
(125,426 |
) |
Purchase of marketable debt securities |
|
— |
|
|
|
(27,203 |
) |
|
|
— |
|
|
|
(27,203 |
) |
Other |
|
— |
|
|
|
(10 |
) |
|
|
— |
|
|
|
(1,598 |
) |
Net cash used in investing activities |
|
(9,040 |
) |
|
|
(58,405 |
) |
|
|
(32,330 |
) |
|
|
(237,880 |
) |
Financing activities: |
|
|
|
|
|
|
|
Proceeds from issuance of common stock in connection with initial
public offering, net of offering costs |
|
— |
|
|
|
(5,148 |
) |
|
|
— |
|
|
|
2,052,382 |
|
Proceeds from issuance of common stock under the Employee Stock
Purchase Plan |
|
— |
|
|
|
7,344 |
|
|
|
— |
|
|
|
7,344 |
|
Taxes paid related to net share settlement of equity awards |
|
— |
|
|
|
(10,304 |
) |
|
|
— |
|
|
|
(422,076 |
) |
Proceeds from issuance of convertible notes and warrants |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
3,551,975 |
|
Draws on credit facilities |
|
— |
|
|
|
10,000 |
|
|
|
937,700 |
|
|
|
1,968,276 |
|
Repayments on credit facilities |
|
— |
|
|
|
(10,000 |
) |
|
|
(937,700 |
) |
|
|
(1,968,276 |
) |
Proceeds from issuance of redeemable convertible preferred stock,
net of issuance costs |
|
(22 |
) |
|
|
— |
|
|
|
1,267,328 |
|
|
|
— |
|
Proceeds from exercise of stock options, net of repurchases |
|
4,968 |
|
|
|
2,016 |
|
|
|
8,555 |
|
|
|
13,796 |
|
Net cash provided by (used in) financing activities |
|
4,946 |
|
|
|
(6,092 |
) |
|
|
1,275,883 |
|
|
|
5,203,421 |
|
Effect of foreign exchange rate changes on cash and cash
equivalents |
|
264 |
|
|
|
22 |
|
|
|
284 |
|
|
|
(68 |
) |
Net increase in cash, cash equivalents, segregated
cash and restricted cash |
|
342,876 |
|
|
|
(340,107 |
) |
|
|
3,120,091 |
|
|
|
4,080,700 |
|
Cash, cash equivalents, segregated cash
and restricted cash, beginning of the period |
|
5,846,783 |
|
|
|
10,610,466 |
|
|
|
3,069,568 |
|
|
|
6,189,659 |
|
Cash, cash equivalents, segregated cash
and restricted cash, end of the period |
$ |
6,189,659 |
|
|
$ |
10,270,359 |
|
|
$ |
6,189,659 |
|
|
$ |
10,270,359 |
|
Cash and cash equivalents, end of the period |
$ |
1,402,629 |
|
|
$ |
6,253,477 |
|
|
$ |
1,402,629 |
|
|
$ |
6,253,477 |
|
Segregated cash, end of the period |
|
4,779,666 |
|
|
|
3,992,419 |
|
|
|
4,779,666 |
|
|
|
3,992,419 |
|
Restricted cash, end of the period |
|
7,364 |
|
|
|
24,463 |
|
|
|
7,364 |
|
|
|
24,463 |
|
Cash, cash equivalents, segregated
cash and restricted cash, end of the period |
$ |
6,189,659 |
|
|
$ |
10,270,359 |
|
|
$ |
6,189,659 |
|
|
$ |
10,270,359 |
|
Supplemental disclosures: |
|
|
|
|
|
|
|
Cash paid for interest |
$ |
509 |
|
|
$ |
5,719 |
|
|
$ |
3,207 |
|
|
$ |
11,902 |
|
Cash paid for income taxes, net of refund received |
$ |
2,850 |
|
|
$ |
2,952 |
|
|
$ |
5,689 |
|
|
$ |
6,111 |
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Results(Unaudited)
|
|
Three Months EndedDecember 31, |
|
Year Ended December 31, |
(in thousands) |
|
|
2020 |
|
|
2021 |
|
|
|
2020 |
|
|
2021 |
|
Net income (loss) |
|
$ |
13,028 |
|
$ |
(423,267 |
) |
|
$ |
7,449 |
|
$ |
(3,686,432 |
) |
Add: |
|
|
|
|
|
|
|
|
Interest expenses related to credit facilities |
|
|
948 |
|
|
5,899 |
|
|
|
4,882 |
|
|
20,218 |
|
Provision for income taxes |
|
|
6,266 |
|
|
2,958 |
|
|
|
6,381 |
|
|
2,000 |
|
Depreciation and amortization |
|
|
3,366 |
|
|
9,761 |
|
|
|
9,938 |
|
|
25,495 |
|
EBITDA (non-GAAP) |
|
|
23,608 |
|
|
(404,649 |
) |
|
|
28,650 |
|
|
(3,638,719 |
) |
Share-based compensation |
|
|
18,982 |
|
|
317,805 |
|
|
|
24,330 |
|
|
1,572,253 |
|
Change in fair value of convertible notes and warrant
liability |
|
|
— |
|
|
— |
|
|
|
— |
|
|
2,045,657 |
|
Significant legal and tax
settlements and reserves |
|
|
36,600 |
|
|
— |
|
|
|
101,600 |
|
|
54,910 |
|
Adjusted EBITDA (non-GAAP) |
|
$ |
79,190 |
|
$ |
(86,844 |
) |
|
$ |
154,580 |
|
$ |
34,101 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP to Non-GAAP
Financial Outlook(Unaudited)
|
|
Year EndedDecember 31, 2021 |
|
Financial Outlook for the Year Ending December 31,
2022 |
|
|
(in thousands) |
|
(year- over-year change) |
Total operating expenses (GAAP) |
|
$ |
3,456,148 |
|
decrease by 5-10% |
Less: SBC |
|
|
1,572,253 |
|
decrease by 35-40% |
Total operating expenses excluding SBC (non-GAAP) |
|
$ |
1,883,895 |
|
increase by 15-20% |
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