It has been about a month since the last earnings report for Interactive Brokers Group, Inc. (IBKR). Shares have lost about 1.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Interactive Brokers due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the latest earnings report in order to get a better handle on the important catalysts.
Interactive Brokers Q4 Earnings Beat as Revenues Grow Y/Y & Expenses Decline
Interactive Brokers’ fourth-quarter 2025 adjusted earnings per share of 65 cents surpassed the Zacks Consensus Estimate of 52 cents. The bottom line reflected a rise of 27.5% from the prior-year quarter.
Results were primarily aided by an increase in revenues and a decline in expenses. Growth in customer accounts and a rise in daily average revenue trades acted as other tailwinds.
After considering non-recurring items, net income available to common shareholders (GAAP basis) was $284 million or 63 cents per share, up from $217 million or 50 cents per share in the prior-year quarter.
Interactive Brokers reported comprehensive income available to common shareholders of $288 million or 64 cents per share compared with $153 million or 35 cents per share in the prior-year quarter.
Adjusted earnings per share of $2.19 in 2025 surpassed the Zacks Consensus Estimate of $2.10. The bottom line reflected a rise of 24.4% from the previous year. Net income available to common shareholders (GAAP basis) was $984 million or $2.22 per share, up from $755 million or $1.73 per share in 2024.
Revenues Improve, Expenses Decline
Total GAAP net revenues for the quarter were $1.64 billion, up 18.5% year over year. Adjusted net revenues were $1.67 billion, up 17.3%. The Zacks Consensus Estimate for the top line was $1.49 billion.
Total GAAP net revenues in 2025 were $6.21 billion, up 19.7% year over year. Adjusted net revenues were $6.16 billion, up 17.1%. The Zacks Consensus Estimate for the top line was $5.99 billion.
Total quarterly non-interest expenses declined 1.2% year over year to $343 million. The fall was primarily due to a decrease in execution, clearing and distribution fees.
Income before income taxes was $1.30 billion, up 25% year over year.
The adjusted pre-tax profit margin was 79%, up from 76% a year ago.
In the reported quarter, total customer DARTs jumped 29.7% year over year to 4.04 million.
Customer accounts grew 31.8% from the year-ago quarter to 4,399,000.
Capital Position Strong
As of Dec. 31, 2025, cash and cash equivalents (including cash and securities set aside for regulatory purposes) totaled $81.8 billion compared with $68.1 billion as of Dec. 31, 2024.
As of Dec. 31, 2025, total assets were $203.2 billion compared with $150.1 billion as of Dec. 31, 2024. Total equity was $20.5 billion, up from $16.6 billion as of Dec. 31, 2024.
Outlook
Management estimates the effect of a 25-basis point decrease in the benchmark Fed Funds rate to result in a $77 million reduction in annual net interest income.
The company expects the effect of a 25-basis point decrease in all the relevant non-USD benchmark rates to result in a $31 million reduction in annual net interest income.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates revision.
VGM Scores
Currently, Interactive Brokers has a nice Growth Score of B, a score with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Interactive Brokers has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Performance of an Industry Player
Interactive Brokers belongs to the Zacks Financial - Investment Bank industry. Another stock from the same industry, Bank of America (BAC), has gained 2.5% over the past month. More than a month has passed since the company reported results for the quarter ended December 2025.
Bank of America reported revenues of $28.37 billion in the last reported quarter, representing a year-over-year change of +11.9%. EPS of $0.98 for the same period compares with $0.82 a year ago.
For the current quarter, Bank of America is expected to post earnings of $0.98 per share, indicating a change of +8.9% from the year-ago quarter. The Zacks Consensus Estimate has changed +0.3% over the last 30 days.
Bank of America has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
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Interactive Brokers Group, Inc. (IBKR): Free Stock Analysis Report Bank of America Corporation (BAC): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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