Interactive Brokers’ Q3 Revenue Strengthens by 70%

Interactive Brokers Group (Nasdaq: IBKR) reported net revenue of $790 million for the three months, between July ad September, which is an increase of 70 percent year-over-year. The adjusted figure increased to $847 million from $650 million.

The overall figure was dragged by interest income that jumped 73 percent to $473 million primarily with higher benchmark interest rates and customer credit balances. However, revenue generated from commission increased only by 3 percent to $320 million.

Losses proceeds from other income streams were also narrowed significantly, which came down to $48 million from $170 million. This figure improved from a $171 million lesser loss related to Interactive Brokers’ investment into Tiger Brokers-operator, UP Fintech.

The revenue for the three months jumped following two consecutive quarters of decline in this figure. In the first and second quarters of 2022, the reported revenue of the American broker declined by 28 percent and 13 percent, respectively.

The reported pre-tax income of the electronic broker came in at $523 million, while the adjusted figure was $580 million. Both the figures increased by 123 percent and 38 percent, respectively. The profit margins also improved, reported at 66 percent and adjusted to 68 percent.

The reported diluted earnings for the quarter was $0.97 with the adjusted figure at $1.08, which is a yearly rise of 125 percent and 38 percent, respectively.

Customer Metrics

Several key customer metrics of the broker showed mixed performances. The number of customer accounts increased by 31 percent to 2.01 million. However, total DARTs for the period decreased by 15 percent to 1.92 million. There were 1.71 million cleared DARTs, which is a decrease of 15 percent.

Furthermore, customer equity decreased by 19 percent to $287.1 billion while customer credits increased by 10 percent to $94.7 billion. The customer margin loans for the period stood at $40.5 billion, which is a decrease of 19 percent.