Robinhood Prices IPO At $38 U.S. A Share

Online brokerage Robinhood has priced its initial public offering (IPO) at $38 U.S. a share, valuing the company at $32 billion U.S.

Ahead of its debut on the NASDAQ stock exchange today (July 29), Robinhood priced its shares at the low end of a $38 U.S. to $42 U.S. range. The company, which will trade under ticker symbol "HOOD," sold 52.4 million shares, raising close to $2 billion U.S.

Co-founders Vlad Tenev and Baiju Bhatt each sold about $50 million U.S. worth of stock.

Robinhood’s trading app has become extremely popular among young and first-time retail investors. The app, which offers equity, cryptocurrency and options trading, as well as cash management accounts, experienced record trading levels during the pandemic and during the meme stock craze earlier this year.

Robinhood estimates it has 22.5 million funded accounts (those tied to a bank account) as of the end of June. That’s up from 18 million in the first quarter, which was an increase of 151% from a year earlier. The company was last valued in the private markets at $11.7 billion U.S. in September.

In its updated prospectus, Robinhood estimated its second quarter revenue at $546 million U.S. to $574 million U.S., up from $244 million U.S. in the second quarter of 2020. Revenue jumped 309% in the first quarter of this year to $522 million U.S. from $128 million U.S. a year ago.

However, Robinhood expects to swing to a net loss of $487 million U.S. to $537 million U.S. in the second quarter after turning a profit in the same quarter last year.

Goldman Sachs and JPMorgan Chase are the lead investment banks on the deal. Underwriters will have an option to buy an additional 5.5 million shares.