Alphabet Dumps Robinhood and Other Household Digital Brands
Google’s parent company Alphabet has recently sold 90% of its shares in Robinhood, according to a regulatory filing with the SEC. The sale of $6,109,896 in Robinhood stock happened just as the digital exchange company reported its first profitable quarter since going public. But Robinhood is not the only digital brand that Alphabet has reduced its position in. The filing also reveals that Alphabet sold $35,502,698 worth of shares in Lyft, as well as a significant amount of shares in Duolingo and 23andMe.
Alphabet’s Early Investments May Have Missed Out on Maximum Profit
Alphabet had invested in all four businesses before their public listing. However, waiting a little longer could have resulted in maximum profit for the company. The SEC filing reports that Alphabet’s selloff of Robinhood shares occurred before the digital exchange’s share price increased notably in July. Additionally, Robinhood reported revenues of $486 million on August 3, marking its first profitable quarter since its IPO.
Robinhood’s Cryptocurrency Trading Platform Shrinks
Despite reporting 10% quarterly revenue growth, Robinhood experienced a decrease in earnings from its cryptocurrency trading platform. The platform’s earnings decreased by 18% to $31 million. Another concerning trend for Robinhood is the decline in monthly active users across its exchange services. In Q2 2023, the platform had 10.8 million monthly active users, representing a loss of one million users since the previous quarter and a decrease of 3.2 million users compared to Q2 2022.
Hot Take:
Alphabet’s decision to divest from Robinhood and other digital brands may raise questions about the future prospects of these companies. The decrease in Robinhood’s cryptocurrency earnings and loss of monthly active users indicate potential challenges ahead. It remains to be seen how these digital brands will navigate the changing landscape of the crypto market.