Robinhood Markets saw its shares tick up 1.3% in premarket trading after announcing it would cut roughly 10% of its full-time workforce.

The cuts represent a sustained trimming operation that has unfolded across multiple waves in 2026, starting with 1,000 US positions eliminated on February 3, followed by 300 jobs at the company’s Menlo Park office confirmed on March 22, and an additional roughly 50 employees let go globally in May.

A company that grew too fast is still paying for it

Between 2020 and 2021, when meme stocks and crypto mania turned every retail investor into a day trader, Robinhood ballooned from approximately 700 employees to nearly 3,800. The company started cutting in April 2022, eliminating around 340 jobs, or roughly 9% of staff. By August 2022, another 780 positions were gone, a 23% reduction. A smaller trim of about 150 roles followed in June 2023, bringing the total to roughly 7% of the remaining workforce at that time.

Crypto revenue decline adds pressure

Q1 2026 financial results showed a notable drop in cryptocurrency trading revenue. At one point, HOOD stock had fallen more than 27% year-to-date.

The company has been working to diversify its revenue streams. Robinhood Gold, its subscription service, represents one attempt to build more predictable, recurring income that doesn’t depend on whether retail traders are feeling frisky on any given Tuesday.

What this means for investors

The 1.3% premarket bump tells a specific story. Investors aren’t celebrating the layoffs themselves. They’re signaling approval of management’s willingness to protect margins when the top line isn’t cooperating.

The competitive landscape matters here too. Traditional brokerages like Charles Schwab and Fidelity have adopted zero-commission trading, eroding one of Robinhood’s original differentiators. Meanwhile, crypto-native exchanges continue to compete aggressively for the digital asset trading volume that Robinhood is losing.

The key metric to watch going forward isn’t the layoff count. It’s whether Robinhood Gold subscriptions and any new revenue initiatives can offset the structural decline in trading-based income.