By Callum Keown
Robinhood has entered the credit card market and it's not there to just make up the numbers.
The company launched its new Robinhood Gold Card Tuesday with a set of enticing features, including 3% cash back on all purchases. In comparison Apple's card offers 3% cash back on purchases at Apple, or 2% when using the card with the company's Apple Pay feature. SoFi offers 2% cash back on all purchases.
The launch comes after Robinhood acquired credit card start-up X1 for $95 million last year and is part of the company's push to become more than just a trading app.
There's no annual fee for the card and no foreign transaction fees, but it's only available for Robinhood Gold members, which comes at a cost of $5 per month. Travel bookings made through the Robinhood travel portal will give users 5% cash back.
"We wanted to build something so jaw-dropping that it will bring more people to the platform, Deepak Rao, president of Robinhood Money said, referring to the 3% cash back feature, The Wall Street Journal reported.
JMP Securities analyst Devin Ryan said the credit card features "live up to the hype," in a note Tuesday. "We are impressed with the offering and anticipate it will resonate in the market, initially growing from a small base, but becoming material in the coming years," he said, maintaining an Outperform rating and a price target of $25 -- implying a 30% upside to Tuesday's closing price.
Investors certainly seemed impressed as the stock jumped more than 7% ahead of the open Wednesday.
AI Increases Global Billionaires
The wealth of tech billionaires has surged over the past year, helped by the artificial-intelligence boom. The Hurun Global Rich List, published Tuesday, revealed an influx of new billionaires with more than half of all new wealth driven by AI.
In total, the world added 167 billionaires in the year to Jan. 15, taking the total to 3,279, according to the report. China held off the U.S. to keep the number one spot with 814 billionaires compared with 800 in the U.S.
Interestingly, Mumbai surpassed Beijing to become the Asian city with the most billionaires -- a reflection of India's surging economic growth.
Back to AI, though, and Nvidia CEO Jensen Huang was a notable new entrant in the top 30 of the Hurun Global Rich List.
But it was Mark Zuckerberg whose wealth grew the most as the Meta Platforms CEO added $90 billion to his net worth, taking him to $158 billion and fourth place behind Tesla CEO Elon Musk, Amazon founder Jeff Bezos, and Bernard Arnault -- the CEO of French luxury conglomerate LVMH.
GoPro to Go Lean
Not all parts of the technology sector are booming. Wearable-camera maker GoPro announced a restructuring late Tuesday, including plans to cut its global workforce by approximately 4%. It will also look to reduce office space as it seeks to cut costs, the company said in a filing with the Securities and Exchange Commission.
The company has reported declining revenue for the past six quarters. The stock, which has tumbled 36% this year through Tuesday's close, climbed 1.8% ahead of the open Wednesday.
Write to Callum Keown at callum.keown@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
March 27, 2024 08:20 ET (12:20 GMT)
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