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Robinhood has not always thrived during periods of extreme volatility, but customers continued to flock to the online trading platform this past month, even after President Donald Trump’s chaotic tariff rollout spooked markets.
Trade-policy uncertainty and economic unease have public companies in industries from airlines to fast food pulling their forward-looking guidance for investors. Online brokerage platform Robinhood offered a confident outlook during its quarterly earnings call Wednesday, however, with its outreach to active traders helping propel the company to a strong April despite President Donald Trump’s tariffs unleashing chaos in the stock market.
Robinhood built its reputation as a buzzy Silicon Valley disrupter, offering commission-free trading that allowed teenagers and twentysomethings to invest using their smartphones. The current appetite of retail investors is being watched closely, but CEO Vlad Tenev said the company has focused on serving the types of traders who dive headfirst into choppy markets.
“Unlike where the business was back in 2022 where we were predominantly focused on novice investors, the new focus on being the best platform for active traders has made us more resilient in times like these,” he said. “Because we used to just not have a lot of mechanisms for customers that were more sophisticated, that wanted to trade [in] sideways or declining markets.”
Volatility has not always been Robinhood’s friend. While traders flocked to the platform during the meme-stock mania of January 2021, record volumes put pressure on the company’s financial plumbing. After a securities regulator hit Robinhood with a $3 billion capital call, the company briefly barred investors from buying GameStop and other popular meme stocks on the platform, leading to accusations the company was colluding with short-sellers who were getting squeezed.
The company’s IPO later that year proved a bust, with shares falling from an initial price of $38 to as low as $7 in 2022, when the S&P 500 ended the year down 18% as the Federal Reserve dramatically hiked interest rates to fight surging inflation.
But the stock now trades above the $45 mark, and the platform received a record $6.5 billion in net deposits this past month despite stocks being on a wild ride. Trump’s chaotic tariff rollout caused the S&P 500 to plunge 19% from its record high in mid-February, only for the index to rise 9% on April 9—its best day since October 2008—when the president announced a 90-day pause on his sweeping “reciprocal tariffs.” An uneasy calm has largely pervaded as the administration claims it’s close to securing several major trade deals.