Higher Trading Activity to Support Interactive Brokers' Q2 Earnings

Interactive Brokers Group IBKR is scheduled to announce second-quarter 2025 results on Thursday, July 17, after market close. 

Interactive Brokers’ first-quarter 2025 earnings lagged the Zacks Consensus Estimate. Higher expenses hurt the results, while an increase in revenues and growth in customer accounts and a rise in Daily Average Revenue Trades (DARTs) acted as tailwinds.

During the second quarter, Interactive Brokers implemented a four-for-one stock split, with trading commencing on a split-adjusted basis on June 18, 2025.

In the to-be-reported quarter, IBKR is likely to have witnessed solid top and bottom-line growth. This can be attributed to substantial market volatility and heightened client activity on concerns related to the impact of tariffs on the U.S. economy and the Federal Reserve’s monetary policy. The Zacks Consensus Estimate for second-quarter revenues of $1.33 billion suggests 8.5% year-over-year growth.

In the past week, the consensus estimate for earnings for the to-be-reported quarter has been revised 4.7% upward to 45 cents per share. This indicates a 2.3% rise from the prior-year quarter.

Estimate Revision Trend
 

Interactive Brokers has a decent earnings surprise history. The company’s earnings outpaced the Zacks Consensus Estimate in two of the trailing four quarters, with the average beat being 2.38%.

Earnings Surprise History
 

Interactive Brokers’ Key Q2 Estimates

Client activity was solid during the second quarter, with the major indexes experiencing extreme volatility due to the Trump administration’s tariff plans and their impact on the U.S. economy and the Fed’s monetary policy. This, along with robust DART numbers in all three months of the quarter, is expected to have supported Interactive Brokers’ commission revenues. The Zacks Consensus Estimate for commission revenues is pegged at $486.8 million, indicating a 19.9% jump from the prior-year quarter. Our estimate for the metric is $485.3 million. 

Additionally, the consensus estimate for other fees and services of $72.4 implies 6.5% growth. We expect the metric to be $78.6 million. The Zacks Consensus Estimate for other income is pegged at $16.5 million against other losses of $36 million in the prior-year quarter. Our estimate for other income is $16.6 million.

However, relatively lower interest rates are expected to have hurt IBKR’s net interest income (NII) in the to-be-reported quarter. The Fed lowered rates in 2024, while keeping them unchanged this year. Thus, the consensus estimate for NII is $758 million, implying a 4.3% decrease. We project NII to be $748.5 million.

On the cost front, total operating expenses are likely to have remained elevated as IBKR invests in key areas to enhance platform capabilities, drive product innovation, improve customer support and build upon regulatory and compliance functions. We anticipate total non-interest expenses of $365.3 million, indicating a rise of 4.4% year over year.

What Our Quantitative Model Unveils for IBKR

Our quantitative model predicts an earnings beat for Interactive Brokers this time. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: Interactive Brokers has an Earnings ESP of +3.33%.

Zacks Rank: The company currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Interactive Brokers’ Price Performance

In the second quarter, Interactive Brokers' stock performance was impressive. The stock outperformed the industry and its close peers – Charles Schwab SCHW and Tradeweb Markets Inc. TW.

2Q25 IBKR Price Performance
 

Schwab will report quarterly numbers on July 18, while Tradeweb will come out with second-quarter results on July 30. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Similar to IBKR, the quarterly performance of Schwab and Tradeweb is expected to have been impressive, driven by robust trading activity during the quarter. As such, analysts are bullish on both. 

Over the past week, the Zacks Consensus Estimate for Schwab’s second-quarter 2025 earnings has been revised 1.9% upward to $1.08, suggesting a year-over-year surge of 48%. Likewise, the consensus estimate for Tradeweb has also been revised 1.2% north to 85 cents per share. This indicates a 21.4% jump from the prior-year quarter.

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This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research