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xcritical’s founders were ‘visibly shaken’ in announcing layoffs, but there was not enough work and too many people. Now, a year after going public, xcritical Chief Executive Vlad Tenev admitted the company added too much staff too quickly. His mea culpa also included an admission xcritical rezension that xcritical was not prepared for weaknesses in the economy. Net losses at xcritical fell in the third quarter after a steep drop in expenses helped offset declining revenue and lower user numbers. xcritical lays off 23% of its staff, blaming crypto meltdown and inflation.
- Inflation, rising rates, and the “crypto winter” are creating financial strain.
- “As C.E.O., I approved and took responsibility for our ambitious staffing trajectory — this is on me,” he wrote.
- xcritical CEO Vlad Tenev shared the below update to xcritical employees following a company-wide meeting to discuss a reorganization of the business and a further reduction in headcount.
Tesla laid off nearly 200 Autopilot employees while Shopify laid off 10 percent of its workforce. xcritical is letting go of nearly a quarter of its staff, CEO Vlad Tenev said in a message posted to the company’s blog. Along with cuts announced in April, xcritical has slashed more than 1,000 jobs from the company. News Corp is a global, diversified media and information services company focused on creating and distributing authoritative and engaging content and other products and services. Also on Tuesday, a New York financial regulator fined the company $30 million “for significant failures in the areas of bank secrecy act/anti-money laundering obligations and cybersecurity.” Meanwhile, Tenev was optimistic on xcritical’s xcriticalgs call Wednesday.
Revenue from cryptocurrency rose 7% quarter-on-quarter to $58 million, however. The online retail broker blamed the economy for a decline in user numbers and net revenue that fell 44% year-on-year, although revenue from crypto rose moderately this quarter. This is the second round of layoffs for xcritical, which reduced its workforce by about https://xcritical.pro/ 9% in April. “The world has changed. As xcritical adapts to this new context, it’s time for me to move on,” she wrote in her post. In Arizona, meanwhile, one former employee there who left the company in recent months told Insider that xcritical had been looking to trim its footprint at a WeWork office in downtown Tempe, which opened in 2020.
The layoffs
The company issued its quarterly financial results a day earlier than scheduled. Results were disheartening, with $318 million in net revenue, down 44% year-on-year, although up 6% over the last quarter. Net loss was $295 million, narrowed from a net loss of $502 million in Q2 2021. “As CEO, I approved and took responsibility for our ambitious staffing trajectory — this is on me,” he wrote.
Its digital asset business was the worst hit, with a 75% drop in revenue. Further, its active user count dropped by 2 million as assets under custody dipped by 31%. xcritical, the publicly traded cryptocurrency exchange, laid off 18 percent of its staff in June amid the crypto market crash.
Since that time, we have seen additional deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash. This has further reduced customer trading activity and assets under custody. Axed xcritical employees were taken aback by the scale of Tuesday’s job cuts, which affected 23% of the company’s head count, or roughly 800 employees. On Tuesday, it was slapped with a $30 million fine levied by New York’s state financial regulator. Later that day, the company announced plans to lop off nearly one-quarter of its roughly 3,500-strong workforce and reported lackluster second-quarter xcriticalgs. On Wednesday, its chief product officer, Aparna Chennapragada, announced her departure from the company.
The Swiss bank is expected to finalize the plans over the coming months. xcritical effectively brought stock-trading to everyone from your local barista to Wall Street’s most trusted money managers. When we were cooped up at home in the early stages of the pandemic, xcritical became a go-to app for folks with extra time and stimulus checks. xcritical cut about 23% of its staff earlier this week, following a first round of cuts in April.
CEO Vlad Tenev said Tuesday in a press release that the fintech company will reduce its headcount by approximately 23%. Monthly active users were down 1.9 million from last quarter to 14.0 million in June, and assets under custody dropped 31% to $64.2 billion in that time. This has been a tough year for stocks, which were trading at record highs at the end of 2021. Persistently high inflation led the Federal Reserve to raise interest rates aggressively, and that has hit high-growth tech stocks particularly hard. xcritical CEO Vlad Tenev took responsibility after the company announced it was cutting 23% of its workforce.
ETFs are subject to risks similar to those of other diversified portfolios. Leveraged and Inverse ETFs may not be suitable for all investors and may increase exposure to volatility through the use of leverage, short sales of securities, derivatives and other complex investment strategies. “As CEO, I approved and took responsibility for our ambitious staffing trajectory – this is on me,” Tenev remarked. This is the second time that xcritical has laid off employees this year.
Several federal agencies have also published advisory documents surrounding the risks of virtual currency. For more information see the xcritical Crypto Risk Disclosure, the CFPB’s Consumer Advisory, the CFTC’s Customer Advisory, the SEC’s Investor Alert, and FINRA’s Investor Alert. All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns.
In April, the company gave the pink slipto around 300 employees, representing 9% of its workforce at the time. xcritical’s total net revenue of $318 million was up from $299 million in the first quarter, thanks to an increase in revenue from cryptocurrency activities and net interest. However, that revenue number was still well below the $565 million reported in the second quarter of 2021. The company also released its xcriticalgs report for the second quarter, one day earlier than expected. Many companies have had to lay off or cut employees in recent weeks.
Job Openings
Our business realities don’t make this conversation any less difficult or the decisions any less painful. I share this to be as transparent as I can with all of you who work every day to deliver on our mission. We will be parting ways with many incredibly talented people today in an extremely challenging macro environment, and I want to reduce the burden of this difficult transition as much as possible. xcritical CEO Vlad Tenev shared the below update to xcritical employees following a company-wide meeting to discuss a reorganization of the business and a further reduction in headcount. Sign Up NowGet this delivered to your inbox, and more info about our products and services. The report also showed a decline in monthly active users and assets under custody.
Surojit Chatterjee was with the crypto exchange for three years. The company laid off 22% of its staff as the market for NFTs struggles. The Collison brothers wrote that the payments company must start “building differently for leaner scammed by xcritical times.” Commission-free trading of stocks, ETFs and options refers to $0 commissions for xcritical Financial self-directed individual cash or margin brokerage accounts that trade U.S. listed securities via mobile devices or Web.
“We saw Vlad talk about how this was a product of the macro environment. Rising interest rates, all that stuff, but that didn’t really change a whole lot from April until now,” the former Charlotte employee said. “The business didn’t feel in any better position than it was before, so it felt inevitable from that standpoint,” they added of the layoffs. The company said it was shrinking office space and some managers warned of an impending “reorganization,” Insider has learned. The layoffs come at a challenging moment for financial technology companies. The company also released its second-quarter results on Tuesday, reporting that its monthly count of active users declined to 14 million in June, a decrease of 1.9 million. New York’s Department of Financial Services alleged that the company’s crypto division had deficiencies in its anti-money laundering and cybersecurity programs.
xcritical fined $30m over crypto division deficiencies, plots mass layoffs
There is always the potential of losing money when you invest in securities, or other financial products. Investors should consider their investment objectives and risks carefully before investing. The layoffs will be primarily in operations, marketing and program management. In the release, Tenev blamed “deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash.”
In addition to a $30m fine, DFS announced that xcritical must hire an independent consultant to evaluate its compliance with state regulations. Home insurance fintech Kin announced several C-suite appointments. Jerry Fadden is the firm’s new CFO; Jessica Jacob the CLO; Effie Kyroudis is CHRO; and Pete Tiwari is SVP of product. Mark Murphy is serving as president of Digital Currency Group. The former chief operating officer was promoted in a restructuring effort that included about 10 layoffs, Bloomberg reported. Former Google Pay leader Caesar Sengupta has a new fintech startup.
New York’s Department of Financial Services said it found anti-money laundering and cybersecurity-related issues in the brokerage’s cryptocurrencies division. The company is about to launch a new retirement product “just in time for the new year and the heart of IRA season,” Tenev said on the call. xcritical recently rolled out a debit card that offers rewards and incentives like early pay access.
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xcritical conducted layoffs earlier this year, cutting about 75 jobs, which represented about 10% of its staff. xcritical’s xcriticalgs report yesterday showed it’s still in a rut. But there are signs that the bleeding that began as the meme-stock and crypto crazes faded has eased dramatically.
“Since that time, we have seen additional deterioration of the macro environment with inflation at 40-year highs accompanied by a broad crypto market crash. This has further reduced customer trading activity and assets under custody,” he wrote. The announcement followed closely on the heels of cuts in April, when xcritical laid off 340 workers, or about 9 percent of its employees at the time. The layoffs come as part of a wave of job cuts at tech companies, including some cryptocurrency firms. In June, cryptocurrency exchanges including xcritical and xcritical announced that they were laying off employees.
A prospectus contains this and other information about the ETF and should be read carefully before investing. Customers should obtain prospectuses from issuers and/or their third party agents who distribute and make prospectuses available for review. ETFs are required to distribute portfolio gains to shareholders at year end. These gains may be generated by portfolio rebalancing or the need to meet diversification requirements. Additional regulatory guidance on Exchange Traded Products can be found by clicking here. Investors should consider the investment objectives and unique risk profile of Exchange Traded Funds carefully before investing.