U.S. markets closed
  • S&P 500

    4,145.19
    -6.75 (-0.16%)
     
  • Dow 30

    32,803.47
    +76.67 (+0.23%)
     
  • Nasdaq

    12,657.55
    -63.04 (-0.50%)
     
  • Russell 2000

    1,921.82
    +15.36 (+0.81%)
     
  • Crude Oil

    88.53
    -0.48 (-0.54%)
     
  • Gold

    1,792.40
    +1.20 (+0.07%)
     
  • Silver

    19.86
    +0.02 (+0.09%)
     
  • EUR/USD

    1.0175
    -0.0075 (-0.73%)
     
  • 10-Yr Bond

    2.8400
    +0.1640 (+6.13%)
     
  • GBP/USD

    1.2090
    -0.0068 (-0.56%)
     
  • USD/JPY

    134.9100
    +1.8940 (+1.42%)
     
  • BTC-USD

    23,179.14
    -12.95 (-0.06%)
     
  • CMC Crypto 200

    533.20
    -2.02 (-0.38%)
     
  • FTSE 100

    7,439.74
    -8.32 (-0.11%)
     
  • Nikkei 225

    28,175.87
    +243.67 (+0.87%)
     

Interactive Brokers Group Announces 2Q2022 Results

  • Oops!
    Something went wrong.
    Please try again later.
·9 min read
In this article:
  • Oops!
    Something went wrong.
    Please try again later.

GAAP DILUTED EPS OF $0.72, ADJUSTED1 EPS OF $0.84

GAAP NET REVENUES OF $656 MILLION, ADJUSTED NET REVENUES OF $717 MILLION

GREENWICH, Conn., July 19, 2022--(BUSINESS WIRE)--Interactive Brokers Group, Inc. (Nasdaq: IBKR), an automated global electronic broker, announced results for the quarter ended June 30, 2022.

Reported diluted earnings per share were $0.72 for the current quarter and $0.84 as adjusted. For the year-ago quarter, reported diluted earnings per share were $1.00 and $0.82 as adjusted.

Reported net revenues were $656 million for the current quarter and $717 million as adjusted. For the year-ago quarter, reported net revenues were $754 million and $650 million as adjusted.

Reported income before income taxes was $392 million for the current quarter and $453 million as adjusted. For the year-ago quarter, reported income before income taxes was $541 million and $437 million as adjusted.

Financial Highlights

(All comparisons are to the year-ago quarter.)

  • Commission revenue increased 5% to $322 million on higher customer options and futures trading volume tempered by lower stock volume.

  • Net interest income increased 27% to $348 million on higher benchmark interest rates and customer balances, partially offset by a decline in securities lending activity.

  • Other income decreased $175 million to a loss of $57 million. This decrease was mainly comprised of the non-recurrence of a $113 million gain related to our strategic investment in Up Fintech Holding Limited ("Tiger Brokers"), $44 million related to our currency diversification strategy, and $7 million related to our U.S. government securities portfolio.

  • Reported pretax profit margin was 60% for the current quarter and 63% as adjusted. For the year-ago quarter, reported pretax margin was 72% and 67% as adjusted.

  • Total equity of $10.6 billion.

The Interactive Brokers Group, Inc. Board of Directors declared a quarterly cash dividend of $0.10 per share. This dividend is payable on September 14, 2022, to shareholders of record as of September 1, 2022.

Business Highlights

(All comparisons are to the year-ago quarter.)

  • Customer accounts increased 36% to 1.92 million.

  • Customer equity decreased 19% to $294.8 billion, including approximately 3% due to an omnibus broker that is now using a trust company for custody.

  • Total DARTs2 decreased 6% to 2.17 million.

  • Cleared DARTs decreased 7% to 1.93 million.

  • Customer credits increased 13% to $92.5 billion.

  • Customer margin loans decreased 13% to $42.6 billion.

Effects of Foreign Currency Diversification

In connection with our currency diversification strategy, we base our net worth in GLOBALs, a basket of 10 major currencies in which we hold our equity. In this quarter, our currency diversification strategy decreased our comprehensive earnings by $158 million, as the U.S. dollar value of the GLOBAL decreased by approximately 1.46%. The effects of the currency diversification strategy are reported as components of (1) Other Income (loss of $53 million) and (2) Other Comprehensive Income (loss of $105 million).

Conference Call Information:

Interactive Brokers Group, Inc. will hold a conference call with investors today, July 19, 2022, at 4:30 p.m. ET to discuss its quarterly results. Members of the public who would like to listen to the conference call should register at https://register.vevent.com/register/BI118f80f52cdc4c4bac02487cd4edacd0 to obtain the dial-in details. The number should be dialed approximately ten minutes prior to the start of the conference call. The conference call will also be accessible simultaneously, and through replays, as an audio webcast through the Investor Relations section of the Interactive Brokers web site, www.interactivebrokers.com/ir.

About Interactive Brokers Group, Inc.:

Interactive Brokers Group affiliates provide automated trade execution and custody of securities, commodities and foreign exchange around the clock on over 150 markets in numerous countries and currencies, from a single unified platform to clients worldwide. We service individual investors, hedge funds, proprietary trading groups, financial advisors and introducing brokers. Our four decades of focus on technology and automation has enabled us to equip our clients with a uniquely sophisticated platform to manage their investment portfolios. We strive to provide our clients with advantageous execution prices and trading, risk and portfolio management tools, research facilities and investment products, all at low or no cost, positioning them to achieve superior returns on investments. For the fifth consecutive year, Barron’s ranked Interactive Brokers #1 with 5 out of 5 stars in its March 25, 2022, Best Online Brokers Review.

Cautionary Note Regarding Forward-Looking Statements:

The foregoing information contains certain forward-looking statements that reflect the Company’s current views with respect to certain current and future events and financial performance. These forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the Company’s operations and business environment which may cause the Company’s actual results to be materially different from any future results, expressed or implied, in these forward-looking statements. Any forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any statements expressed or implied therein will not be realized. Additional information on risk factors that could potentially affect the Company’s financial results may be found in the Company’s filings with the Securities and Exchange Commission.

1 See the reconciliation of non-GAAP financial measures starting on page 9.

2 Daily average revenue trades (DARTs) are based on customer orders.

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

Three Months

Six Months

Ended June 30,

Ended June 30,

2022

2021

2022

2021

(in millions, except share and per share data)

Revenues:

Commissions

$

322

$

307

$

671

$

719

Other fees and services

43

55

96

111

Other income (loss)

(57

)

118

(96

)

238

Total non-interest income

308

480

671

1,068

Interest income

460

307

792

697

Interest expense

(112

)

(33

)

(162

)

(118

)

Total net interest income

348

274

630

579

Total net revenues

656

754

1,301

1,647

Non-interest expenses:

Execution, clearing and distribution fees

77

54

148

122

Employee compensation and benefits

112

96

223

193

Occupancy, depreciation and amortization

23

19

45

39

Communications

9

8

17

16

General and administrative

42

35

80

94

Customer bad debt

1

1

2

3

Total non-interest expenses

264

213

515

467

Income before income taxes

392

541

786

1,180

Income tax expense

32

35

60

88

Net income

360

506

726

1,092

Net income attributable to noncontrolling interests

288

414

581

893

Net income available for common stockholders

$

72

$

92

$

145

$

199

Earnings per share:

Basic

$

0.73

$

1.01

$

1.47

$

2.19

Diluted

$

0.72

$

1.00

$

1.46

$

2.17

Weighted average common shares outstanding:

Basic

98,853,981

91,365,234

98,541,798

91,078,868

Diluted

99,695,489

92,199,169

99,461,867

91,984,246

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

Three Months

Six Months

Ended June 30,

Ended June 30,

2022

2021

2022

2021

(in millions, except share and per share data)

Comprehensive income:

Net income available for common stockholders

$

72

$

92

$

145

$

199

Other comprehensive income:

Cumulative translation adjustment, before income taxes

(24

)

5

(34

)

(12

)

Income taxes related to items of other comprehensive income

-

-

-

-

Other comprehensive income (loss), net of tax

(24

)

5

(34

)

(12

)

Comprehensive income available for common stockholders

$

48

$

97

$

111

$

187

Comprehensive earnings per share:

Basic

$

0.48

$

1.06

$

1.12

$

2.06

Diluted

$

0.47

$

1.05

$

1.11

$

2.04

Weighted average common shares outstanding:

Basic

98,853,981

91,365,234

98,541,798

91,078,868

Diluted

99,695,489

92,199,169

99,461,867

91,984,246

Comprehensive income attributable to noncontrolling interests:

Net income attributable to noncontrolling interests

$

288

$

414

$

581

$

893

Other comprehensive income - cumulative translation adjustment

(81

)

16

(112

)

(43

)

Comprehensive income attributable to noncontrolling interests

$

207

$

430

$

469

$

850

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(UNAUDITED)

June 30,
2022

December 31,
2021

(in millions)

Assets

Cash and cash equivalents

$

2,881

$

2,395

Cash - segregated for regulatory purposes

23,536

22,888

Securities - segregated for regulatory purposes

30,709

15,121

Securities borrowed

3,855

3,912

Securities purchased under agreements to resell

6,288

4,380

Financial instruments owned, at fair value

551

673

Receivables from customers, net of allowance for credit losses

42,552

54,935

Receivables from brokers, dealers and clearing organizations

1,939

3,771

Other assets

1,003

1,038

Total assets

$

113,314

$

109,113

Liabilities and equity

Liabilities

Short-term borrowings

$

17

$

27

Securities loaned

10,696

11,769

Financial instruments sold but not yet purchased, at fair value

218

182

Other payables:

Customers

90,765

85,634

Brokers, dealers and clearing organizations

308

557

Other payables

708

722

91,781

86,913

Total liabilities

102,712

98,891

Equity

Stockholders' equity

2,524

2,395

Noncontrolling interests

8,078

7,827

Total equity

10,602

10,222

Total liabilities and equity

$

113,314

$

109,113

June 30,
2022

December 31,
2021

Ownership of IBG LLC Membership Interests

Interests

%

Interests

%

IBG, Inc.

99,601,921

23.7

%

98,230,127

23.5

%

Noncontrolling interests (IBG Holdings LLC)

319,880,492

76.3

%

319,880,492

76.5

%

Total IBG LLC membership interests

419,482,413

100.0

%

418,110,619

100.0

%

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

OPERATING DATA

TRADE VOLUMES:

(in 000's, except %)

Cleared

Non-Cleared

Avg. Trades

Customer

%

Customer

%

Principal

%

Total

%

per U.S.

Period

Trades

Change

Trades

Change

Trades

Change

Trades

Change

Trading Day

2019

302,289

26,346

17,136

345,771

1,380

2020

620,405

105%

56,834

116%

27,039

58%

704,278

104%

2,795

2021

871,319

40%

78,276

38%

32,621

21%

982,216

39%

3,905

2Q2021

196,659

16,130

7,975

220,764

3,504

2Q2022

186,791

(5%)

18,274

13%

8,327

4%

213,392

(3%)

3,442

1Q2022

212,818

20,671

9,225

242,714

3,915

2Q2022

186,791

(12%)

18,274

(12%)

8,327

(10%)

213,392

(12%)

3,442

CONTRACT AND SHARE VOLUMES:

(in 000's, except %)

TOTAL

Options

%

Futures1

%

Stocks

%

Period

(contracts)

Change

(contracts)

Change

(shares)

Change

2019

390,739

128,770

176,752,967

2020

624,035

60%

167,078

30%

338,513,068

92%

2021

887,849

42%

154,866

(7%)

771,273,709

128%

2Q2021

196,715

35,061

172,099,915

2Q2022

217,642

11%

51,562

47%

81,137,875

(53%)

1Q2022

245,343

53,570

97,406,991

2Q2022

217,642

(11%)

51,562

(4%)

81,137,875

(17%)

ALL CUSTOMERS

Options

%

Futures1

%

Stocks

%

Period

(contracts)

Change

(contracts)

Change

(shares)

Change

2019

349,287

126,363

167,826,490

2020

584,195

67%

164,555

30%

331,263,604

97%

2021

852,169

46%

152,787

(7%)

766,211,726

131%

2Q2021

189,073

34,635

...