Robinhood is a financial services company known for pioneering commission-free trades of stocks, exchange-traded funds and cryptocurrencies via a mobile app. On or about July 30, 2021, Robinhood conducted its IPO, offering 55 million shares of its common stock to the public at a price of $38 per share (the Offering Price) for anticipated proceeds of over $2 billion. According to the complaint, Robinhoods registration statement and prospectus used to effectuate its IPO contained representations that were materially inaccurate, misleading, and/or incomplete because they failed to disclose that, at the time of the IPO, Robinhoods revenue growth was experiencing a major reversal, with transaction-based revenues from cryptocurrency trading serving only as a short-term, transitory injection, masking what was actually stagnating growth. In addition, the Companys significant investments in enhancing the reliability and scalability of its platform were patently inadequate and/or defective, exposing Robinhood to worsening service-level disruptions and security breaches, particularly as the Company scaled its services to a larger user base. As these true facts emerged after the Offering, Robinhoods shares fell sharply, trading as low as $17.08 per share, representing a decline of over 55% from the Offering Price.
The alleged class includes : All persons and entities that purchased or otherwise acquired, Robinhood common stock issued in connection with the Company’s IPO.
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