Interactive Brokers Sets Revenue Record

Interactive Brokers Group (NASDAQ:IBKR) reported Q2 2025 earnings on July 17, 2025, delivering record net revenues, a 27% year-over-year increase in commissions to $516 million, and a pretax margin of 75%, all amid robust net new account acquisition and heightened trading activity. Key updates include a 170% increase in overnight trading volumes year over year, and ongoing expansion of international access and cryptocurrency capabilities.

Surging Global Account Growth and Automated Scale

Net new accounts increased by 250,000 sequentially, bringing the year-to-date total above 528,000. That exceeded the total number of new accounts added during all of 2023. Client credit balances grew 34% to a record $144 billion, and equity also grew 34% compared to the prior year.

"Our application processing is highly automated and continually becoming even more so, allowing us to handle surges in new accounts efficiently without adding significantly to our headcount or cost base. New accounts meant more cash in those accounts, raising our client credit balances 34% to a record $144 billion, despite strength in trading volumes indicating our customers are using the cash they deposit to participate in the markets. Our client equity rose 34% [year over year] to $664 billion, up 16% [sequentially] for the quarter compared to 11% for the S&P. More accounts and higher volumes translated into strong financial results. Quarterly commissions, net interest, total net revenue, and pretax income were all records, with our pretax income reaching over $1 billion for the third consecutive quarter. Our expenses remained well controlled, and our pretax profit margin was an industry-leading 75%, a record for us.
— Nancy Stuebe, Director of Investor Relations (presenting CEO remarks)

The firm’s ability to accelerate account growth while maintaining a stable cost structure underscores the high operational leverage and competitive moat provided by end-to-end automation.

Rapid Expansion in 24/5 Global Access and Overnight Trading

Overnight trading hours experienced a 170% increase in volume year-over-year, backed by the firm's advanced ATS (Alternative Trading System) enhancements, improved processing capability by up to 20 times on high-volume days and broadened access to over 10,000 U.S. stocks and ETFs. This expansion caters particularly to international clients operating in time zones where U.S. overnight hours coincide with their local daytime trading.

"Given our global client base, for some customers, overnight hours here are their daytime trading hours that they want to operate in, and, therefore, are particularly sought after. We enhanced our ATS this quarter by improving its performance and ability to handle large spikes in volume by up to 20x on high-volume days, ensuring we are better equipped for market surges and capable of delivering top-tier execution for our clients."
— Nancy Stuebe, Director of Investor Relations (presenting CEO remarks)

This investment into round-the-clock liquidity and execution strengthens Interactive Brokers Group’s positioning versus peers.

Diversified Product Innovation and Client Toolset Enhancement

During Q2, the company launched multiple high-impact product features, including Forecast X (event contracts) that are now live across major geographies, and investment themes for quick discovery of trade ideas, while also intensifying investments in crypto infrastructure and asset transfer capability -- a response to new regulatory tailwinds in the digital asset space.

"Yesterday, we introduced investment themes, a powerful new discovery tool designed to help investors quickly turn market trends into actionable trading ideas. With investment themes, clients can begin with broad topics like generative AI or nuclear energy and instantly uncover companies tied to those themes. No ticker symbols or prior research needed. Alternatively, they can start with the ticker symbol."
— Nancy Stuebe, Director of Investor Relations (presenting CEO remarks)

These new data-driven and trend-aligned products also present new avenues for trading revenue as clients increasingly leverage these advanced tools across asset classes and regions.

Looking Ahead

Management expects to surpass 4 million customer accounts in Q3 2025, just one year after reaching 3 million. Explicit rate sensitivity guidance states that a 25-basis-point Fed funds cut would reduce annual net interest income by $73 million, based on balances as of June 30, 2025, with a 1% global benchmark decrease translating to a $335 million impact on annual net interest income, tempered by balance sheet growth. No changes were announced to the current capital allocation policy, with selective pursuit of acquisitions only at valuations deemed attractive.

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This article was created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Interactive Brokers Group. The Motley Fool recommends the following options: long January 2027 $175 calls on Interactive Brokers Group and short January 2027 $185 calls on Interactive Brokers Group. The Motley Fool has a disclosure policy.