EX-99.1 2 ibkr-8k_20240331er.htm 1Q24 EARNINGS RELEASE
INTERACTIVE BROKERS GROUP ANNOUNCES 1Q2024 RESULTS

— — —

GAAP DILUTED EPS OF $1.61, ADJUSTED1 EPS OF $1.64
GAAP NET REVENUES OF $1,203 MILLION, ADJUSTED NET REVENUES OF $1,216 MILLION
RAISES QUARTERLY DIVIDEND FROM $0.10 TO $0.25

GREENWICH, CT, April 16, 2024 — Interactive Brokers Group, Inc. (Nasdaq: IBKR), an automated global electronic broker, announced results for the quarter ended March 31, 2024.

Reported diluted earnings per share were $1.61 for the current quarter and $1.64 as adjusted. For the year-ago quarter, reported diluted earnings per share were $1.42 and $1.35 as adjusted.

Reported net revenues were $1,203 million for the current quarter and $1,216 million as adjusted. For the year-ago quarter, reported net revenues were $1,056 million and $1,015 million as adjusted.

Reported income before income taxes was $866 million for the current quarter and $879 million as adjusted. For the year-ago quarter, reported income before income taxes was $761 million and $720 million as adjusted.

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

Commission revenue increased 6% to $379 million. Customer trading volume was mixed across product types with options contract volume up 24%, while futures contract and stock share volumes were down 3% and 16%, respectively.

Net interest income increased 17% to $747 million on higher benchmark interest rates, customer margin loans and customer credit balances.

Other fees and services increased $16 million, or 37%, to $59 million, driven primarily by increases of $13 million in risk exposure fees and $2 million in FDIC sweeps fees.

Execution, clearing and distribution fees expenses increased 6% to $101 million, driven by higher customer trading volume in options.

Pretax profit margin for the current quarter was 72% both as reported and as adjusted. For the year-ago quarter, reported pretax margin was 72% and 71% as adjusted.

Total equity of $14.7 billion.

The Interactive Brokers Group, Inc. Board of Directors declared an increase in the quarterly cash dividend from $0.10 per share to $0.25 per share. This dividend is payable on June 14, 2024, to shareholders of record as of May 31, 2024.




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

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

Customer accounts increased 25% to 2.75 million.
Customer equity increased 36% to $465.9 billion.
Total DARTs2 increased 14% to 2.35 million.
Customer credits increased 9% to $104.9 billion.
Customer margin loans increased 30% to $51.2 billion.

Other Items

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 $104 million, as the U.S. dollar value of the GLOBAL decreased by approximately 0.73%. The effects of the currency diversification strategy are reported as components of (1) Other Income (loss of $2 million) and (2) Other Comprehensive Income (loss of $102 million).

Conference Call Information:

Interactive Brokers Group, Inc. will hold a conference call with investors today, April 16, 2024, 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/BI26c88a82ea0c42b9a6ac91b51a30659c 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 serve 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 sixth consecutive year, Barron’s ranked Interactive Brokers #1 with 5 out of 5 stars in its June 9, 2023, 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.

For Interactive Brokers Group, Inc. Investors: Nancy Stuebe, investor-relations@ibkr.com or Media: Rob Garfield, media@ibkr.com.



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

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)

       
Three Months
       
Ended March 31,
       
2024
 
2023
       
(in millions, except share and per share data)
Revenues:
           
 
Commissions
 
$
379
 
$
357
 
Other fees and services
   
59
   
43
 
Other income
   
18
   
19
   
Total non-interest income
   
456
   
419
                 
 
Interest income
   
1,760
   
1,347
 
Interest expense
   
(1,013)
   
(710)
   
Total net interest income
   
747
   
637
   
Total net revenues
   
1,203
   
1,056
                 
Non-interest expenses:
           
 
Execution, clearing and distribution fees
   
101
   
95
 
Employee compensation and benefits
   
145
   
128
 
Occupancy, depreciation and amortization
 
26
   
24
 
Communications
   
10
   
9
 
General and administrative
   
50
   
36
 
Customer bad debt
   
                                 5
   
                                 3
   
Total non-interest expenses
   
337
   
295
Income before income taxes
   
866
   
761
Income tax expense
   
71
   
61
Net income
   
795
   
700
Net income attributable to noncontrolling interests
 
620
   
552
Net income available for common stockholders
$
175
 
$
148
                 
Earnings per share:
           
 
Basic
 
$
1.63
 
$
1.44
 
Diluted
 
$
1.61
 
$
1.42
                 
Weighted average common shares outstanding:
     
 
Basic
   
107,070,830
   
102,958,660
 
Diluted
   
108,149,440
   
104,042,571

3

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)

       
Three Months
       
Ended March 31,
       
2024
 
2023
       
(in millions, except share and per share data)
Comprehensive income:
           
 
Net income available for common stockholders
 
$
175
 
$
148
 
Other comprehensive income:
           
   
Cumulative translation adjustment, before income taxes
                             (26)
   
                                 5
   
Income taxes related to items of other comprehensive income
 
                                 -
   
                                 -
 
Other comprehensive income (loss), net of tax
   
                             (26)
   
                                 5
Comprehensive income available for common stockholders
$
149
 
$
153
                 
Comprehensive earnings per share:
           
 
Basic
 
$
1.39
 
$
1.48
 
Diluted
 
$
1.37
 
$
1.47
                 
Weighted average common shares outstanding:
           
 
Basic
   
107,070,830
   
102,958,660
 
Diluted
   
108,149,440
   
104,042,571
                 
                 
Comprehensive income attributable to noncontrolling interests:
     
 
Net income attributable to noncontrolling interests
 
$
620
 
$
552
 
Other comprehensive income - cumulative translation adjustment
 
(76)
   
14
Comprehensive income attributable to noncontrolling interests
$
544
 
$
566

4

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(UNAUDITED)

         
March 31,
2024
 
December 31,
2023
         
(in millions)
Assets
               
Cash and cash equivalents
     
$
                 4,063
 
$
                 3,753
Cash - segregated for regulatory purposes
       
               29,961
   
               28,840
Securities - segregated for regulatory purposes
       
               29,292
   
               35,386
Securities borrowed
       
                 6,362
   
                 5,835
Securities purchased under agreements to resell
       
                 6,674
   
                 5,504
Financial instruments owned, at fair value
       
                 1,112
   
                 1,488
Receivables from customers, net of allowance for credit losses
     
               51,395
   
               44,472
Receivables from brokers, dealers and clearing organizations
     
                 1,684
   
                 1,643
Other assets
       
                 1,695
   
                 1,502
 
Total assets
     
$
132,238
 
$
128,423
                   
Liabilities and equity
               
                   
Liabilities
               
Short-term borrowings
     
$
                     14
 
$
                     17
Securities loaned
       
               14,216
   
               11,347
Financial instruments sold but not yet purchased, at fair value
     
                    236
   
                    193
Other payables:
               
 
Customers
       
              101,197
   
              101,012
 
Brokers, dealers and clearing organizations
       
                    561
   
                    590
 
Other payables
       
                 1,355
   
                 1,197
           
              103,113
   
              102,799
 
Total liabilities
       
              117,579
   
              114,356
                   
Equity
               
Stockholders' equity
       
                 3,732
   
                 3,584
Noncontrolling interests
       
               10,927
   
               10,483
 
Total equity
       
               14,659
   
               14,067
 
Total liabilities and equity
     
$
132,238
 
$
128,423
                   
   
March 31, 2024
 
December 31, 2023
Ownership of IBG LLC Membership Interests
Interests
 
 %
 
Interests
   
 %
                   
IBG, Inc.
107,099,483
 
25.4%
 
107,049,483
   
25.4%
Noncontrolling interests (IBG Holdings LLC)
313,976,354
 
74.6%
 
313,976,354
   
74.6%
                   
Total IBG LLC membership interests
421,075,837
 
100.0%
 
421,025,837
   
100.0%

5

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
OPERATING DATA

EXECUTED ORDER VOLUMES: 
(in 000's, except %)

   
Customer
 
%
 
Principal
 
%
 
Total
 
%
Period
 
Orders
 
Change
 
Orders
 
Change
 
Orders
 
Change
2021
 
     646,440
     
       27,334
     
         673,774
   
2022
 
     532,064
 
 (18%)
 
       26,966
 
 (1%)
 
         559,030
 
 (17%)
2023
 
     483,015
 
 (9%)
 
       29,712
 
10%
 
         512,727
 
 (8%)
                         
1Q2023
 
     127,329
     
         6,757
     
         134,086
   
1Q2024
 
     143,320
 
13%
 
         9,190
 
36%
 
         152,510
 
14%
                         
4Q2023
 
     120,886
     
         7,932
     
         128,818
   
1Q2024
 
     143,320
 
19%
 
         9,190
 
16%
 
         152,510
 
18%

CONTRACT AND SHARE VOLUMES:
(in 000's, except %)
 
TOTAL
   
Options
 
%
 
Futures1
 
%
 
Stocks
 
%
Period
 
(contracts)
 
Change
 
(contracts)
 
Change
 
(shares)
 
Change
2021
 
     887,849
     
     154,866
     
   771,273,709
   
2022
 
     908,415
 
2%
 
     207,138
 
34%
 
   330,035,586
 
 (57%)
2023
 
   1,020,736
 
12%
 
     209,034
 
1%
 
   252,742,847
 
 (23%)
                         
1Q2023
 
     247,508
     
       55,197
     
     75,522,066
   
1Q2024
 
     307,593
 
24%
 
       54,046
 
 (2%)
 
     64,027,092
 
 (15%)
                         
4Q2023
 
     279,945
     
       53,883
     
     59,046,908
   
1Q2024
 
     307,593
 
10%
 
       54,046
 
0%
 
     64,027,092
 
8%
                         

CUSTOMER
   
Options
 
%
 
Futures1
 
%
 
Stocks
 
%
Period
 
(contracts)
 
Change
 
(contracts)
 
Change
 
(shares)
 
Change
2021
 
     852,169
     
     152,787
     
   766,211,726
   
2022
 
     873,914
 
3%
 
     203,933
 
33%
 
   325,368,714
 
 (58%)
2023
 
     981,172
 
12%
 
     206,073
 
1%
 
   248,588,960
 
 (24%)
                         
1Q2023
 
     239,038
     
       54,577
     
     74,562,384
   
1Q2024
 
     296,146
 
24%
 
       53,018
 
 (3%)
 
     62,898,480
 
 (16%)
                         
4Q2023
 
     269,082
     
       52,996
     
     58,112,082
   
1Q2024
 
     296,146
 
10%
 
       53,018
 
0%
 
     62,898,480
 
8%

PRINCIPAL TRANSACTIONS
   
Options
 
%
 
Futures1
 
%
 
Stocks
 
%
Period
 
(contracts)
 
Change
 
(contracts)
 
Change
 
(shares)
 
Change
2021
 
       35,680
     
         2,079
     
       5,061,983
   
2022
 
       34,501
 
 (3%)
 
         3,205
 
54%
 
       4,666,872
 
 (8%)
2023
 
       39,564
 
15%
 
         2,961
 
 (8%)
 
       4,153,887
 
 (11%)
                         
1Q2023
 
         8,470
     
           620
     
         959,682
   
1Q2024
 
       11,447
 
35%
 
         1,028
 
66%
 
       1,128,612
 
18%
                         
4Q2023
 
       10,863
     
           887
     
         934,826
   
1Q2024
 
       11,447
 
5%
 
         1,028
 
16%
 
       1,128,612
 
21%


1
Includes options on futures.

6

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
OPERATING DATA, CONTINUED

Year over Year
   
1Q2024
   
1Q2023
 
% Change
   Total Accounts (in thousands)
   
                      2,746
   
                      2,195
 
25%
   Customer Equity (in billions)1
 
$
465.9
 
$
343.1
 
36%
                 
   Total Customer DARTs (in thousands)
   
                      2,350
   
                      2,054
 
14%
                 
Cleared Customers
               
   Commission per Cleared Commissionable Order2
 
$
2.93
 
$
3.16
 
 (7%)
   Cleared Avg. DARTs per Account (Annualized)
   
                         197
   
                         214
 
 (8%)
                 
Consecutive Quarters
   
1Q2024
   
4Q2023
 
% Change
   Total Accounts (in thousands)
   
                      2,746
   
                      2,562
 
7%
   Customer Equity (in billions)1
 
$
465.9
 
$
426.0
 
9%
                 
   Total Customer DARTs (in thousands)
   
                      2,350
   
                      1,934
 
22%
                 
Cleared Customers
               
   Commission per Cleared Commissionable Order2
 
$
2.93
 
$
3.19
 
 (8%)
   Cleared Avg. DARTs per Account (Annualized)
   
                         197
   
                         172
 
15%


1
Excludes non-customers.
   
2
Commissionable Order - a customer order that generates commissions.

7

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
NET INTEREST MARGIN
(UNAUDITED)

       
Three Months
       
Ended March 31,
       
2024
 
2023
       
(in millions)
Average interest-earning assets
           
 
Segregated cash and securities
 
$
                              61,132
 
$
                              59,679
 
Customer margin loans
   
                              46,653
   
                              39,303
 
Securities borrowed
   
                                5,368
   
                                4,868
 
Other interest-earning assets
   
                                9,952
   
                                9,777
 
FDIC sweeps1
   
                                3,861
   
                                2,428
       
$
                            126,966
 
$
                            116,055
                 
Average interest-bearing liabilities
           
 
Customer credit balances
 
$
                              99,510
 
$
                              95,802
 
Securities loaned
   
                              11,734
   
                                8,571
 
Other interest-bearing liabilities
   
                                     -
   
                                       1
       
$
                            111,244
 
$
                            104,374
                 
Net interest income
           
 
Segregated cash and securities, net
 
$
                                   764
 
$
                                   603
 
Customer margin loans2
   
                                   678
   
                                   477
 
Securities borrowed and loaned, net
   
                                     26
   
                                     88
 
Customer credit balances, net2
   
                                 (881)
   
                                 (653)
 
Other net interest income1/3
   
                                   175
   
                                   125
   
Net interest income3
 
$
                                   762
 
$
                                   640
                 
Net interest margin ("NIM")
   
2.41%
   
2.24%
                 
Annualized yields
           
 
Segregated cash and securities
   
5.03%
   
4.10%
 
Customer margin loans
   
5.85%
   
4.92%
 
Customer credit balances
   
3.56%
   
2.76%


1
Represents the average amount of customer cash swept into FDIC-insured banks as part of our Insured Bank Deposit Sweep Program. This item is not recorded in the Company's consolidated statements of financial condition. Income derived from program deposits is reported in other net interest income in the table above.
                             
2
Interest income and interest expense on customer margin loans and customer credit balances, respectively, are calculated on daily cash balances within each customer’s account on a net basis, which may result in an offset of balances across multiple account segments (e.g., between securities and commodities segments).  
                             
3
Includes income from financial instruments that has the same characteristics as interest, but is reported in other fees and services and other income in the Company’s consolidated statements of comprehensive income. For the three months ended March 31, 2024 and 2023, $6 million and $3 million were reported in other fees and services, respectively. For the three months ended March 31, 2024 and 2023, $9 million and $0 million were reported in other income, respectively.




8

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(UNAUDITED)

     
Three Months
     
Ended March 31,
     
2024
 
2023
     
(in millions)
Adjusted net revenues1
           
Net revenues - GAAP
 
$
1,203
 
$
1,056
               
Non-GAAP adjustments
           
 
Currency diversification strategy, net
   
2
   
(1)
 
Mark-to-market on investments2
   
11
   
                     (40)
Total non-GAAP adjustments
   
13
   
(41)
Adjusted net revenues
 
$
1,216
 
$
1,015
               
Adjusted income before income taxes1
           
Income before income taxes - GAAP
 
$
866
 
$
761
               
Non-GAAP adjustments
           
 
Currency diversification strategy, net
   
2
   
(1)
 
Mark-to-market on investments2
   
11
   
                     (40)
Total non-GAAP adjustments
   
                       13
   
                     (41)
Adjusted income before income taxes
 
$
879
 
$
720
               
Adjusted pre-tax profit margin
   
72%
   
71%

9


     
Three Months
     
Ended March 31,
     
2024
 
2023
     
(in millions)
Adjusted net income available for common stockholders1
     
Net income available for common stockholders - GAAP
$
175
 
$
148
               
Non-GAAP adjustments
           
 
Currency diversification strategy, net
   
0
   
0
 
Mark-to-market on investments2
   
3
   
(10)
 
Income tax effect of above adjustments3
   
(1)
   
                         2
Total non-GAAP adjustments
   
                         2
   
                       (8)
Adjusted net income available for common stockholders
$
177
 
$
140
               
Note: Amounts may not add due to rounding.
           


     
Three Months
     
Ended March 31,
     
2024
 
2023
     
(in dollars)
Adjusted diluted EPS1
           
Diluted EPS - GAAP
 
$
1.61
 
$
1.42
               
Non-GAAP adjustments
           
 
Currency diversification strategy, net
   
0.00
   
(0.00)
 
Mark-to-market on investments2
   
0.03
   
(0.09)
 
Income tax effect of above adjustments3
   
(0.01)
   
0.02
Total non-GAAP adjustments
   
0.02
   
(0.07)
Adjusted diluted EPS
 
$
1.64
 
$
1.35
               
Diluted weighted average common shares outstanding
108,149,440
   
104,042,571
               
Note: Amounts may not add due to rounding.
           


10


Note: The term “GAAP” in the following explanation refers to generally accepted accounting principles in the United States.
1 Adjusted net revenues, adjusted income before income taxes, adjusted net income available for common stockholders and adjusted diluted earnings per share (“EPS”) are non-GAAP financial measures.
We define adjusted net revenues as net revenues adjusted to remove the effect of our currency diversification strategy and our net mark-to-market gains (losses) on investments2.
We define adjusted income before income taxes as income before income taxes adjusted to remove the effect of our currency diversification strategy and our net mark-to-market gains (losses) on investments.
We define adjusted net income available to common stockholders as net income available for common stockholders adjusted to remove the after-tax effects attributable to IBG, Inc. of our currency diversification strategy and our net mark-to-market gains (losses) on investments.
We define adjusted diluted EPS as adjusted net income available for common stockholders divided by the diluted weighted average number of shares outstanding for the period.
Management believes these non-GAAP items are important measures of our financial performance because they exclude certain items that may not be indicative of our core operating results and business outlook and may be useful to investors and analysts in evaluating the operating performance of the business and facilitating a meaningful comparison of our results in the current period to those in prior and future periods. Our currency diversification strategy and our mark-to-market on investments are excluded because management does not believe they are indicative of our underlying core business performance. Adjusted net revenues, adjusted income before income taxes, adjusted net income available to common stockholders and adjusted diluted EPS should be considered in addition to, rather than as a substitute for, GAAP net revenues, income before income taxes, net income attributable to common stockholders and diluted EPS.

2 Mark-to-market on investments represents the net mark-to-market gains (losses) on investments in equity securities that do not qualify for equity method accounting which are measured at fair value, on our U.S. government and municipal securities portfolio, which are typically held to maturity, and on certain other investments, including equity securities taken over by the Company from customers related to losses on margin loans.

3 The income tax effect is estimated using the statutory income tax rates applicable to the Company.


11