Robinhood is a very successful early stage company. The have multiple companies tied to a parent company. Here, I’ll quickly cover the financials for Robinhood Securities, LLC the registered broker/dealer arm of Robinhood. This is the entity that process all of your orders.
First, note that Robinhood Securities has over $3 BILLION in assets. A large portion of that ($2.4B) is cash held for users and other broker/dealers. So, it’s not really Robinhood’s. But, once it’s removed the still have around $1 billion in assets. Safe to say, they’re doing well.
Next, let’s look at receivable from users. The receivable from users represents “margin” loans provided by Robinhood to users. This allows users to buy stock and options on credit in return for a pre-determined interest rate. Robinhood currently has $658 million in loans to users.
Now, let’s turn to the Securities Loaned. It is common practice for brokerages to lend stock held by clients to other institutions. This is primarily so that the second firm’s clients can “short” the stock. That is, they borrow from Robinhood, sell it in the market and hope to buy it back cheaper to return to Robinhood. Some brokerages share this income with their clients, Robinhood does not. They are essentially helping you buy stocks to then lend to other firms to bet against your position.