Interactive Brokers posts Q1 earnings, raises dividend

Interactive Brokers Group Inc (NASDAQ:IBKR) announced its first-quarter financial results for the period ending March 31, 2024. The leading automated global electronic broker reported a GAAP diluted EPS of $1.61 and an adjusted EPS of $1.64.

Revenue figures exceeded Wall Street forecasts, with GAAP net revenues reaching $1,203 million and adjusted net revenues at $1,216 million.

Interactive Brokers derives nearly 70% of its net revenue from the U.S. market, with the remaining 30% coming from international operations. The company has seen a robust increase in its financials, with net income available for common stockholders rising from $148 million in Q1 2023 to $175 million in Q1 2024. This growth was supported by increases in both interest and non-interest income, indicating a diversified revenue stream.

Despite the strong financial performance, the discount broker reported a $104 million decrease in earnings due to its currency diversification strategy, which was affected by a 0.73% depreciation in the U.S. dollar value against its GLOBAL basket.

The Greenwich, Connecticut-based company also revealed that on average it charged clients commission fees of $2.89 per order in March compared with $3.03 in February. This figure includes exchange, clearing and regulatory fees, with the key product metrics coming out as follows:

Interactive Brokers LLC (NASDAQ: IBKR) recorded 2.41 million daily average revenue trades (DARTs) in March 2024, virtually unchanged from the 2.2 million transactions observed in the previous month. This figure was higher by 15 percent year-on-year.

In terms of equity balance in customers’ accounts during March, the figure totaled $465.9 billion, which is 36% higher than the previous year and roughly 4 percent relative to $448.2 billion in the prior month.

Additionally, the ending client margin loan balances stood at $51.2 billion, up 30% from the previous year and 8% higher than February’s $47.4 billion. Interactive Brokers’ client credit balances, including insured bank deposit sweeps, totaled $104.9. This figure is 9% higher than the previous year, and 2% from the prior month.

Interactive Brokers made headlines in late 2023 when it obtained a license to engage in virtual asset trading for retail clients. This development is also part of a larger wave of regulatory approvals in the region, with Hashkey historically being the first crypto exchange in Hong Kong to be licensed for retail crypto asset offerings back in August.

Interactive Brokers already offers low-fee cryptocurrency trading for professional investors in Hong Kong. The firm, one of the largest brokerages in the US, opened an early-access waitlist to eligible clients including individuals with over HKD 8 million in assets or institutions with assets greater than HKD 40 million. They are able to trade and custody Bitcoin (BTC) and Ethereum (ETH) alongside stocks, options, futures, bonds, mutual funds and exchange-traded funds, creating a unified client experience.