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    IBKR
    Earnings call· Dec 2025(Q4 FY25)

    Interactive Brokers Group, Inc. IBKR

    Jan 20, 2026 Source

    Executive summary

    Interactive Brokers Q4 FY25 — Record Account Growth and Financial Results

    Interactive Brokers delivered record financial results in Q4 FY25, driven by strong client engagement and global demand for investing. The company achieved record net new accounts and client equity, while expanding its platform capabilities with new products, global market access, and AI-powered tools. Strategic investments in technology and a client-centric approach continue to underpin its growth, with a bank charter application underway to further enhance service offerings.

    Highlights

    5

    • Net new accounts exceeded 1 million for the full year 2025, an annual record for the firm.

    • Client equity rose 37% to $780 billion, marking the first time ending the year with over $0.75 trillion.

    • Quarterly adjusted pretax income reached a record level of more than $1 billion for the fifth consecutive quarter.

    • Full-year net revenues exceeded $6 billion for the first time.

    • Total customer DARTs were 4 million trades per day in Q4 FY25, up 30% from the prior year.

    Concerns

    3

    • Fewer hard-to-borrow names were observed in securities lending in Q4 FY25 compared to Q3 FY25.

    • A 25 basis point decrease in the benchmark Fed funds rate is estimated to reduce annual net interest income by $77 million.

    • A 25 basis point decrease in all relevant non-USD benchmark rates is estimated to reduce annual net interest income by $31 million.

    Guidance & targets

    4
    CategoryTargetConfidence
    Annual Net Interest Income (USD rate sensitivity)
    $77 million reduction
    high materiality
    High
    Annual Net Interest Income (non-USD rate sensitivity)
    $31 million reduction
    medium materiality
    High
    Expense Growth
    similar growth
    medium materiality
    Medium
    Crypto Offering Launch (Europe)
    go live
    medium materiality
    High

    Operational metrics

    38
    Client equity
    $780 billionup 37%
    FY25

    Increased by more than $200 billion year-over-year, exceeding $0.75 trillion for the first time.

    Net new accounts
    more than 1 millionannual record
    FY25

    An annual record for the firm.

    S&P 500 performance
    17.9%
    2025

    Used as a benchmark for client outperformance.

    Individual investor portfolio performance
    19.2%130 basis points above the S&P 500
    2025

    Average performance for individual investors.

    Financial adviser portfolio performance
    20.57%267 basis points above the market
    2025

    Average performance for financial advisers.

    Hedge fund client portfolio performance
    28.91%11 percentage points ahead of the S&P
    2025

    Average performance for hedge fund clients.

    Commission revenues
    $582 million
    Q4 FY25

    Record commission revenues for the quarter. Full year commissions were $2.1 billion, up 27% from last year.

    Other fees and services revenue
    $85 millionup modestly versus the prior year periods
    Q4 FY25

    Primarily driven by higher payments for order flow from options exchange mandated programs and higher FDIC sweep fees. Full year was $291 million.

    Other income (adjusted)
    $37 million
    Q4 FY25

    Primarily driven by a loss in the currency diversification program. Reported other income was $10 million.

    Execution, clearing and distribution costs
    $91 milliondown 21% from the year ago quarter
    Q4 FY25

    These costs and rebates are largely passed through to customers.

    SEC fee rate impact
    $0Q4 2024 SEC fees were $22 million
    Q4 FY25

    Reflects a full quarter of the SEC fee rate at 0.

    Execution and clearing costs as % of commission revenues
    11%
    Q4 FY25

    Calculated by excluding $23 million of non-transaction-based costs (predominantly market data fees).

    Compensation and benefits expense
    $153 million
    Q4 FY25

    Reflects focus on expense discipline.

    Compensation expense to adjusted net revenues ratio
    9%versus 10% in the prior year quarter
    Q4 FY25

    For the full year, this ratio was 10%, down from 11% in 2024.

    Head count
    3,182up 6% over the prior year
    Dec 31, 2025

    Moderate staff increase.

    G&A expenses
    $62 millionup 5% from the year ago quarter
    Q4 FY25

    Primarily from increasing spending on advertising. For the full year, G&A was $247 million, up 10% excluding prior year legal settlement and one-time consolidation charge.

    Income taxes
    $99 million
    Q4 FY25

    Reflects the sum of the public company's $39 million and the operating company's $60 million.

    Public company effective tax rate
    12%below its typical range
    Q4 FY25

    Primarily due to tax benefits captured in 2025.

    Total assets
    $203 billion35% higher than the prior year
    FY25

    Growth driven by higher margin lending and segregated cash balances.

    Firm equity
    exceed $20 billionup 23% for the year
    FY25

    First time exceeding $20 billion.

    Options contract volumes growth
    up 27%up 26% for the full year
    Q4 FY25

    In line with industry volumes.

    Futures contract volumes growth
    up 22%up 12% for the full year
    Q4 FY25

    Well above industry volumes.

    Stock share volumes growth
    up 16%up 38% for the full year
    Q4 FY25

    Clients gravitated to larger, higher-quality names.

    Customer DARTs
    4 million trades per dayup 30% from the prior year
    Q4 FY25

    Total customer DARTs.

    Commission per cleared commissionable order
    $2.64down from last year
    Q4 FY25

    Primarily due to a mix of smaller average order sizes in stocks and futures and the SEC fee rate moving to 0.

    Adjusted Net Interest Income (NIM presentation)
    just over $1 billion
    Q4 FY25

    Includes certain income that is more appropriately considered interest for NIM purposes, but for GAAP is classified as other fees and services or other income.

    Average U.S. Fed funds rate change
    fell 75 basis pointsor by 16%
    YoY

    Year-on-year change in the average U.S. Fed funds rate.

    Margin loan interest growth
    up 17%
    YoY

    Bolstered by higher balances despite rate decline.

    Segregated cash interest change
    down 3%
    YoY

    Bolstered by higher balances despite rate decline.

    Average duration of investment portfolio
    less than 30 days
    Q4 FY25

    Strategy to maximize short-term yields and maintain tight maturity match.

    Securities lending total net revenue (estimated)
    $290 millionup 58% over the prior year quarter
    Q4 FY25

    Estimate if additional interest earned and paid on cash collateral were included under securities borrowed and loaned.

    Fully rate-sensitive customer balances
    $24.7 billionversus $19.1 billion in the year ago quarter
    Q4 FY25

    Customer balances sensitive to interest rate changes.

    ForecastEx traded pairs
    286 millionup from 15 million pairs in the third quarter
    Q4 FY25

    Trading volume on the ForecastEx exchange.

    ForecastEx members quoting
    4
    Q4 FY25

    Number of members quoting into the ForecastEx exchange.

    ForecastEx listed instruments
    over 10,000
    Q4 FY25

    Number of instruments listed on ForecastEx.

    FDIC sweep program limit (individual)
    $5 milliondoubled from $2.5 million
    Q4 FY25

    Increased limit for individual accounts.

    FDIC sweep program limit (joint)
    $10 milliondoubled from $5 million
    Q4 FY25

    Increased limit for joint accounts.

    Trading volume during overnight hours growth
    up 76%up more than 130% from the fourth quarter of last year
    QoQ

    Rapid growth in trading volume during overnight hours.

    Industry KPIs

    2
    MetricValueDetails
    Pretax margin79%%
    Net interest income$966 millionUSD

    Product announcements

    6
    ProductTypeDetails
    GlobalTrader 2.0 mobile platformlaunch
    IBKR desktop platform enhancementsupdate
    Connections featurelaunch
    AI-powered investment themeslaunch
    AI-generated news summarieslaunch
    Ask IBKRlaunch

    Deals & partnerships

    1
    KartaIntroduced Karta Visa Infinite Card globally.

    Allows eligible clients to link their accounts and access cash instantly anywhere in the world with no foreign transaction fees, offering premium cardholder benefits.

    Risks & headwinds

    4
    Interest Rate Sensitivity (USD)Annual

    $77 million reduction in annual net interest income

    Mitigation: Any growth in balance sheet and interest-earning assets would reduce this impact; average duration of investment portfolio is less than 30 days.

    Interest Rate Sensitivity (non-USD)Annual

    $31 million reduction in annual net interest income

    Mitigation: Any growth in balance sheet and interest-earning assets would reduce this impact; average duration of investment portfolio is less than 30 days.

    Fewer Hard-to-Borrow Names in Securities LendingQ4 FY25 vs Q3 FY25

    fewer hard-to-borrow names

    Mitigation: Full year results well over prior year; growing account base increases inventory of attractive stocks to lend; fully paid lending program shares proceeds with clients.

    Regulatory Uncertainty for Prediction MarketsOngoing

    Massachusetts ruling against Kalshi

    Mitigation: Interactive Brokers' ForecastEx does not rely on sports; believes in broad applicability of prediction markets beyond sports.

    What to watch in Q1 FY26

    5

    OCC Bank Charter Operational Status

    by the end of this year
    CurrentApplication filed, in contact with OCC
    TargetOperational

    Why it matters

    Will allow IBKR to custody mutual funds and ETFs, expanding service offerings and potentially client assets.

    my expectation would be to be operational by the end of this year. Now exactly what that means for us is as the broker-dealer, the regulations do not permit us to custody assets of mutual funds and exchange traded funds. A trust charter bank will allow us to do that.

    Q&A highlights

    7

    Why the decline in interest paid to yield didn't match expectations, and if there's a repricing lag.

    Explained that strong margin lending balances vastly overcame the drop in benchmark rates, and there is a repricing lag on the asset side for segregated cash, where higher rates were retained while lower rates were paid on credit balances.

    “So for seg cash when the rates come down, even though we have a relatively short duration, there is a little bit of tail out there. And we retained somewhat higher rates while we pay lower rates on our credit balances during that period because they are based on the overnight rates. The rest of balance changes. So our very strong performance in the margin lending balances overcame -- vastly overcame the drop in the general benchmark rates.”

    asked by Brennan Hawken · answered by Paul Brody

    3 min read7 chapters

    Detailed Narrative

    01

    Record Performance and Client Growth

    Interactive Brokers achieved record financial results in Q4 FY25, with adjusted pretax income exceeding $1 billion for the fifth consecutive quarter and full-year net revenues surpassing $6 billion for the first time. The firm added over 1 million net new accounts in 2025, an annual record, driving client equity up 37% to $780 billion, marking the first time it exceeded $0.75 trillion. This growth was fueled by strong international interest and increased client engagement in a rising market environment.

    02

    Client-Centric Platform and Outperformance

    The company's focus on delivering global market access, competitive pricing, and state-of-the-art platforms resulted in significant client outperformance. In 2025, individual investors were up 19.2% (130 bps above S&P 500), financial advisors were up 20.57% (267 bps above market), and hedge fund clients were up 28.91% (11 percentage points ahead of S&P 500). This is attributed to low trade and margin pricing, superior execution, advanced order types, attractive interest rates on cash, and comprehensive research and educational tools.

    03

    Global Expansion and Product Enhancements

    Throughout 2025, Interactive Brokers expanded its global footprint by adding market access to Brazil, Taiwan, the UAE, and Slovenia, with more countries planned for 2026. It also broadened its offering of country-specific tax-advantaged funds, including Swedish ISK, Japan's NISAs, and Canadian FHSAs. Clients can now fund accounts using Stablecoin, and the FDIC sweep program limit was doubled to $5 million for individual accounts and $10 million for joint accounts.

    04

    AI Integration and Platform Innovation

    The firm embedded artificial intelligence across its platforms, launching AI-powered investment themes for actionable ideas and AI-generated news summaries for timely portfolio-related news. The 'Ask IBKR' tool allows clients to interact in plain English to analyze portfolios, track activity, compare performance, and analyze sector exposure. Mobile and desktop platforms also received significant updates, including GlobalTrader 2.0's UI/UX revamp and IBKR desktop's multi-monitor support and Linux beta installer.

    05

    Prediction Markets (ForecastEx) Growth

    ForecastEx, IBKR's CFTC-regulated prediction exchange, saw substantial growth, trading 286 million pairs in Q4 FY25, up from 15 million in Q3. It now has 4 members quoting and over 10,000 listed instruments. The platform was rolled out on a 24/7 trading schedule in mid-December, with ongoing efforts to tie temperature contracts to electricity and natural gas contracts, targeting institutional clients like utilities.

    06

    Balance Sheet Strength and Capital Allocation

    Interactive Brokers' total assets grew 35% year-over-year to $203 billion, driven by higher margin lending and segregated cash balances. Firm equity increased 23% to exceed $20 billion for the first time, with no long-term debt. The company maintains a strong balance sheet to support business growth, win new clients, and demonstrate strength to partners, while continuously considering overall capital allocation.

    07

    Bank Charter Application Update

    The company is in contact with the OCC regarding its National Trust Bank Charter application, which has been officially filed. Management expects to be operational by the end of 2026. The primary rationale for the charter is to enable the custody of mutual funds and exchange-traded funds, which broker-dealers are currently not permitted to do, thereby expanding the firm's service offerings.

    AI-generated summary of the company’s earnings call. Not investment advice.