Robinhood Markets Inc's (NASDAQ:HOOD) equities trading volume surged to a record $5 billion on Tuesday, marking one of the platform's biggest days in the past 12 months. This achievement comes amid a resurgence in retail trading, reminiscent of the 2021 meme stock frenzy, where Robinhood played a pivotal role as a favored platform for retail investors.

What Happened: Robinhood CEO Vlad Tenev revealed that the trading app had experienced a surge in equities trading volume, reaching a record $5 billion on Tuesday.

He also mentioned that the company would upgrade its systems to accommodate the increasing load, with certain features potentially being temporarily unavailable between 1 a.m. and 3 a.m. ET.

"@RobinhoodApp hit $5B in equities trading volume today ... one of our biggest days in the past 12 months," Tenev wrote.

In the first quarter, Robinhood reported a notable surge in options contracts traded, marking a 26% increase year-over-year, totaling 343.6 million contracts. Equally impressive was the 40% year-over-year rise in equity notional trading volumes, reaching $225.0 billion.

Additionally, Robinhood's strategic move of offering a 3% retirement transfer match sparked substantial customer adoption. During the promotion period from January to April, customers transferred over $4 billion in retirement assets from competing brokerages, averaging over $90,000 per customer.

The resurgence of retail trading, reminiscent of the 2021 meme stock frenzy, is evident as Robinhood emerges as a favored platform among retail traders once again.

Popular stocks like GameStop (NYSE:GME) and AMC Entertainment Inc (NYSE:AMC) are dominating Wall Street this week, witnessing substantial surges in their stock prices.

Robinhood's stock surged sharply this week as social media-driven trading gained momentum. This surge coincided with GameStop's remarkable 74% climb, following the return of "Roaring Kitty" aka Keith Gill, a prominent retail trader from the 2021 meme stock era, who resumed posting on social media on Sunday.

It's worth noting that Robinhood was not publicly traded during the peak of the 2021 meme stock rally, having gone public in July 2021. However, transaction revenue at Robinhood, a key measure of trading activity, had reached its peak during the retail trading saga of 2021, according to Reuters.

Why It Matters: Robinhood reported record revenue of $618 million in the first quarter of 2024, a 40% increase year-over-year. This exceeded the Street's consensus estimate of $548.6 million.

The platform's strong financial results have coincided with its plans to expand its product suite for active traders, with the introduction of index options and futures trading in the fourth quarter of 2024.

The $5 billion equities trading volume is a significant achievement for Robinhood, especially considering the company's recent frustrations with the SEC over its crypto arm.

Despite these challenges, the platform has continued to expand its offerings and attract a growing user base, as evidenced by its soaring trading volumes.

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