IBKR

Financials

Interactive Brokers

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Market Data

Financials

XBRL · SEC EDGAR

2008–2025(18yr)

Revenue

Net Income

Free CF

Metric	FY 2008	FY 2009	FY 2010	FY 2011	FY 2012	FY 2013	FY 2014	FY 2015	FY 2016	FY 2017	FY 2018	FY 2019	FY 2020	FY 2021	FY 2022	FY 2023	FY 2024	FY 2025Latest	YoY
Revenue	$2.2B	$1.2B	$988.3M	$1.4B	$1.2B	$1.1B	$1.1B	$1.3B	$1.5B	$1.9B	$2.4B	$2.6B	$2.2B	$2.7B	$3.1B	$4.3B	$5.2B	$6.2B	+19.7%
Net Income	$93.0M	$36.2M	-$9.3M	$61.9M	$40.7M	$37.0M	$44.5M	$415.0M	$699.0M	$793.0M	$1.1B	$1.1B	$1.2B	$1.6B	$1.8B	$2.8B	$3.4B	$4.4B	+27.9%
Net Margin	4.3%	3.1%	-0.9%	4.3%	3.4%	3.3%	4.0%	33.0%	47.4%	41.2%	47.5%	42.2%	53.2%	60.3%	60.1%	64.8%	65.7%	70.2%	+4.5pp
EPS (Diluted)	$2.24	$0.87	$-0.22	$1.39	$0.89	$0.73	$0.77	$0.78	$1.25	$1.07	$2.28	$2.10	$2.42	$3.24	$3.75	$5.67	$6.93	$2.22	-68.0%

Cash & Equiv.$5.0B

3 min read

1. THE BIG PICTURE

Interactive Brokers is no longer just a niche platform for professional traders; its inclusion in the S&P 500 marks its evolution into a global financial utility that competes on pure technological efficiency. By automating nearly every middle- and back-office function, Interactive Brokers has created a high-margin scale machine that allows it to offer the industry’s lowest costs while maintaining a massive $80.1 billion cash cushion (XBRL).

2. WHERE THE RISKS HIT HARDEST

Interactive Brokers’s primary strength—its proprietary, internally developed technology—is also its most concentrated point of failure. While this software allows for "minimal human intervention" and rapid global deployment (10-K Item 1), any cybersecurity breach or system failure could cause "material financial losses" because the platform lacks full redundancy (10-K Item 1A). Furthermore, the low-cost leadership that attracts its institutional client base is threatened by "Trading Volume and Interest Rate Sensitivity." Because Interactive Brokers relies on these external macro factors for revenue, a period of low market volatility or falling rates could squeeze margins that Interactive Brokers’s automated fixed-cost base cannot easily offset.

3. WHAT THE NUMBERS SAY TOGETHER

The most recent quarterly data reveals a business firing on all cylinders, with commission revenue rising 22% to $582 million and net interest income jumping 20% to $966 million (8-K). This growth is remarkably consistent with the TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue growth of 19.7%, suggesting that Interactive Brokers is successfully maintaining its trajectory despite its size (XBRL). While the reduction of the SEC Section 31 transaction fee rate to zero dragged down execution fees by 21%, this was more than offset by a 27% surge in customer options volume (8-K). Sentiment remains stable, with short interest at a modest 2.6% of the float and 1.9 days to cover (Yahoo Finance).

4. IS IT WORTH IT AT THIS PRICE?

At a forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations of 25.1x, Interactive Brokers trades exactly in line with the peer group median (Yahoo Finance). The market is currently pricing in approximately 7.5% long-term growth (CAPM analysis). Given that Interactive Brokers’s actual TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue growth is 19.7%—nearly triple the implied rate—the current valuation appears well-supported by fundamental performance. However, this premium relative to a peer like Charles Schwab (13.8x Fwd P/EFwd P/EForward P/E — same as P/E but uses next year's estimated earnings instead of past earnings; reflects where investors think the company is going) is only justified if Interactive Brokers continues to capture market share internationally, where it currently generates 30% of its revenue (10-K Item 1A). If long-term growth were to mean-revert to a GDP-paced 2.5%, the justified multiple would drop sharply to 11.3x.

5. WHAT WOULD CHANGE THIS VIEW?

Constructive if Interactive Brokers successfully diversifies its "Other fees" beyond market data and FDIC sweep fees, reducing the 20% reliance on net interest income growth.
Cautious if there is any significant "customer performance" default in the clearing business, as Interactive Brokers is financially liable for customer defaults when market liquidity is insufficient (10-K Item 1A).
Cautious if Thomas Peterffy, who controls 73.7% of the total voting power, initiates a dividend policy or management shift that prioritizes his 91.6% economic interest in the holding company over minority shareholders (14A Proxy).

6. BOTTOM LINE

Structural Advantage: A proprietary, highly automated global routing and clearing system that produces a cost floor competitors struggle to match. Bottom Line: Interactive Brokers is a high-performance technology play on global capital markets that is fairly valued for its growth, provided investors can stomach the macro volatility and founder-controlled governance.

Source: Synthesis · LLM Analysis

4 min read

1. Top 5 Material Risks

Trading Volume and Interest Rate Sensitivity: Interactive Brokers’ revenues and profitability are prone to significant fluctuations because they depend on the level of global trading activity and interest rate levels, which are difficult to predict.
Concentration of Control: Mr. Thomas Peterffy and his affiliates beneficially own approximately 91.6% of the economic interests and all voting interests in Holdings, which controls approximately 73.7% of the combined voting power of Interactive Brokers, allowing him to dictate management, board composition, and dividend policy.
Technological and Cybersecurity Vulnerabilities: Interactive Brokers relies on proprietary software and technology that is not fully redundant; system failures, cyber-attacks, or data compromises could result in monetary damages, reputational harm, and operational disruption.
Clearing and Execution Risk: As a clearing member, Interactive Brokers is financially liable for customer performance; defaults by customers or other clearing members could result in material losses, particularly if market liquidity is insufficient to liquidate collateral.
International Operations: Approximately 30% of net revenues in 2025 were generated by operating subsidiaries outside the U.S., exposing Interactive Brokers to risks including political instability, currency controls, and varying regulatory requirements.

2. Company-Specific Risks

Tax Receivable Agreement Obligations: Interactive Brokers is required to pay Holdings 85% of the tax savings realized from a $2.2 billion tax basis step-up (as of December 31, 2025), with potential future basis increases reaching $44.6 billion depending on share prices and transaction structures.
Dependency on IBG LLC: As a holding company with no independent revenue generation, Interactive Brokers depends on cash distributions from IBG LLC to pay tax liabilities and other expenses; if IBG LLC cannot provide these funds, it would have a material adverse effect on Interactive Brokers's financial condition.
Cryptocurrency Service Provider (CSP) Reliance: Interactive Brokers does not provide execution or custody for cryptocurrency assets, relying instead on third-party CSPs; data breaches or technical failures at these CSPs could result in irreversible losses for which Interactive Brokers disclaims responsibility.
Controlled Company Status: Because of Mr. Peterffy’s ownership, Interactive Brokers is a "controlled company" under Nasdaq rules, meaning it is not required to maintain a majority of independent directors or fully independent compensation and nominating committees.

3. Regulatory/Legal Risks

Change in Control Regulations: Subsidiaries such as Interactive Brokers Canada, Inc., Interactive Brokers (U.K.) Limited, and others are subject to strict change-in-control regulations by bodies like FINRA, the FCA, and the SFC, which may delay or prohibit future capital-raising efforts.
Prediction Market Uncertainty: The legal framework for "Forecast Contracts" offered through ForecastEx is evolving, and adverse regulatory actions or new laws could prevent the offering of these contracts in the U.S. or abroad.
Global Tax Compliance: Interactive Brokers is subject to complex tax laws, including the OECD’s Pillar Two Framework, which imposes a minimum effective tax rate of 15% in certain jurisdictions; unfavorable resolutions of tax reviews could significantly impact the effective tax rate.
Data Privacy Compliance: Interactive Brokers must comply with stringent rules including the GDPR, U.K. GDPR, and China’s Personal Information Protection Law; failure to comply could result in significant fines and litigation.

4. Financial Impact Map

Trading Volume and Interest Rate Sensitivity → Net Revenues → Fluctuations in trading activity and interest rate levels directly impact transaction and interest income. Concentration of Control → Dividends on Common Stock → Mr. Peterffy has the ability to determine the declaration and payment of dividends. Technological and Cybersecurity Vulnerabilities → Operating Expenses → Potential for increased costs related to compliance, security measures, and potential monetary damages from cyber incidents. Clearing and Execution Risk → Net Revenues / Earnings → Customer defaults or clearing house assessments could result in direct financial losses. Tax Receivable Agreement Obligations → Cash Flows / Tax Liabilities → Payments to Holdings reduce the cash benefit of tax savings realized from the tax basis step-up.

Source: 10-K Item 1A · LLM Analysis