Interactive Brokers Group Inc Q2 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Craig Siegenthaler - Bank of America - Analyst : Hey, good evening everyone. Hope you're all doing well. So I wanted to follow up with a comment that Thomas made at a conference in May. Actually, I think it was promised. The commentary was regarding decelerating account growth. However, account growth in the quarter was still really strong, 32% clipped in line with last quarter. So I was just -- I was hoping you could help clarify those comments you made. And should we expect somewhat slower growth in the summer months into 4Q as we've seen in previous years?

Question: Craig Siegenthaler - Bank of America - Analyst : Great. Well, Thomas, we like it when you overdeliver, too. Just for my follow-up, so the Genius Act, I think, just passed in the house several minutes ago, says that's pretty much done. The Clarity Act is making its way through Congress. So two digital asset initiatives. Thomas, I'm wondering, will broader demand for digital assets. Could this cause you to rethink your current digital asset model, which relies on Paxos partnership but also doesn't allow your clients to use noncustodial wallets with their IBKR accounts. I know -- I think you felt pretty strong in the past about holding crypto on the balance sheet, which is [one issue].

Question: Craig Siegenthaler - Bank of America - Analyst : Great. That sounds exciting. Good to hear Milan, and guys, thanks for taking my questions.

Question: James Yaro - Goldman Sachs - Analyst : Thanks a lot for taking the questions. I just wanted to start with any perspectives that you might have on the tokenized equity products that we're seeing across a variety of broker and crypto firms European customers on US stocks, maybe you could just talk about the advantages and disadvantages of this product in your view, I guess, is it something that you would consider offering and not sure exactly why, but if so, that would be helpful. And then, I guess, your perspective on whether this product represents any sort of additional competition in Europe relative to your business?

Question: James Yaro - Goldman Sachs - Analyst : Okay. Thank you, Milan. That's really helpful color. Could you just talk a little bit about the execution cost differences that you're seeing on your platform in overnight market versus during markets? I know that's a tough one because I'm generalizing across a variety of products. So maybe you can just talk about stocks today. And then maybe you could just talk about your expectations for how execution costs outside of market hours could evolve over time?

Question: James Yaro - Goldman Sachs - Analyst : Okay. Thanks a lot.

Question: Benjamin Budish - Barclays - Analyst : Hi, good evening and thanks for taking the question. Maybe first, just a high-level question. You've talked a lot about the pickup in international growth quite a bit over the last many years. I'm just curious in terms of overnight trading specifically, it sounds like that is growing much faster than international growth more broadly. Curious, is that sort of a behavior change? Is it sort of more -- stock options being made available? It sounds like your offering has been pretty consistent for some time, but just curious if you could unpack what you're seeing there? I know -- I think Thomas mentioned also at a conference earlier that you have an expectation that that's going to be quite meaningful as a percentage of total volumes over the next 10 to 20 years. So for your commentary on sort of the recent drivers of that outsized growth?

Question: Benjamin Budish - Barclays - Analyst : Very helpful. Maybe one more sort of in the weeds question perhaps for Paul. Just in terms of your interest rate sensitivity, it looks like this quarter versus last quarter, maybe a slightly higher percentage of cash is not in US dollars, but the sensitivity to a 25 basis point change in rates seems like it's is a much lower dollar number. Just curious is it like a lower absolute starting level of rates? Or what's the driver of that sort of lower sensitivity? Thank you.

Question: Benjamin Budish - Barclays - Analyst : Okay. Very helpful. Thank you so much.

Question: Dan Fannon - Jefferies - Analyst : Great. Thank you. I was hoping to expand upon your comments around sec lending, clearly improved this quarter. You talked about an increase in some hard to borrow securities, Curious about how diverse that was. And as we think about an environment where IPOs are picking up? Is it reasonable to assume that, that should be on an upward trajectory, given the kind of current trends?

Question: Dan Fannon - Jefferies - Analyst : Great. That's helpful. And then I was hoping you could expand upon the introducing broker comments thinking about the size of the partners that are coming on and also the backlog you mentioned also, I think, was reasonably good. Just how you would characterize that versus, say, maybe a year ago and how those conversations have progressed.

Question: Dan Fannon - Jefferies - Analyst : Great. Thank you.

Question: Kyle Voigt - Keefe, Bruyette & Woods - Analyst : Hi, good evening. Maybe just a question on client credit balances, which grew, I think, over 6% in the month of June, which is the highest since March of 2020. Can you just speak about the main drivers of what you saw in June specifically. Was it more new cash being deposited into accounts? Was it rebalancing from existing clients or is there something else driving that significant cash increase that we saw in June?

Question: Kyle Voigt - Keefe, Bruyette & Woods - Analyst : Okay. Just for a follow-up. We've seen a recent reacceleration in 0DTE trading percentages in the broader options market was just curious to hear about whether you have been seeing that in your own customer base in recent months? And then also curious to hear about your view of rolling out 0DTE on single stocks what else needs to be done from the brokerage industry standpoint in terms of functionality to be able to offer this? And how close are we in terms of being able to see that product hit the market, do you think?

Question: Kyle Voigt - Keefe, Bruyette & Woods - Analyst : Great. Thank you.

Question: Patrick Moley - Piper Sandler - Analyst : Yeah, good evening. Thanks for taking the question. Thomas, I had one for you. I caught your interview on CNBC before the call here. You sounded very bullish. I think you said that you don't really see much that could derail this rally here and that you could see this rally continue for the next two or three years. So with that in mind, I'm just hoping you could elaborate on what that could mean for overall retail trading activity if we do see markets continue to growing higher. And then in terms of IBKR platform specifically, what are some of the read-throughs there if that is the environment that we're entering into? Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 17, 2025 / 8:30PM, IBKR.OQ - Q2 2025 Interactive Brokers Group Inc Earnings Call

Question: Patrick Moley - Piper Sandler - Analyst : And maybe just a follow-up on crypto. Milan, I think last quarter, you said that you were somewhat surprised at just how much -- how little market share you've taken since beefing out the crypto offering just given how much lower cost the offering was. So just curious if that's still what you've seen. Have you seen any market share gains there? And then this push to kind of build out the offering even more, is that a factor of you just recognizing that you think you need to have a more robust offering in order to attract more retail customers to the platform? Any color there on that strategy would be great. Thanks.

Question: Patrick Moley - Piper Sandler - Analyst : Okay, great. That's it for me.