Days after Robinhood’s record-breaking FINRA fine, the company revealed it has filed for its much-anticipated initial public offering with the Securities and Exchange Commission. The company field its registration statement on Form S-1 relating to the proposed IPO of its Class A common stock.
According to the official announcement, the price range for the proposed offering have not yet been determined or the date of its debut. Robinhood stated that it will list its Class A common shares on the Nasdaq Stock Market, under the symbol “HOOD.” The stock trading app has expressed hopes to raise $100 million by going public.
Robinhood noted that acting as joint lead book-running managers for the proposed offering are Goldman Sachs & Co. LLC and J.P. Morgan. Barclays, Citigroup and Wells Fargo Securities are acting as active book-running managers.
The online brokerage is aiming to benefit from its own public trading to sell stock to its customers. Robinhood will set aside 35% of its shares for individual investors on its own trading platform, which is a larger allocation than in a typical IPO.
The company has stated that it manages over $80 billion for around 18 million users on its platform, of which more than half have made accounts for a first time.
The company also reported that its growing business managed to turn a profit last year. Its sales rose to $958.8 million last year, registering 245% increase on yearly basis. Robinhood’s profit for last year reached $7.5 million, a compelling improvement compared to its $106.6 million loss in 2019. It’s unclear if the company is still going to turn a profit this year as well.
Several risk factors have impacted the company including the growing regulatory scrutiny and technological issues, especially the system-wide outages around the meme stock frenzy.
Earlier this week, Robinhood was ordered to pay a total of $70 million in penalties, the largest FINRA penalty in history for “systemic supervisory failures” and giving investors “false or misleading information.”
In January, Robinhood found itself in the eye of the storm during GameStop saga. As a Reddit-fueled craze boosted the stock of GameStop, AMC and Blackberry, Robinhood, Interactive Brokers and other retail brokers blocked access. The restriction caused a severe outrage among users and company’s CEO, Vlad Tenev, had to appear before Congress for questioning.
