Interactive Brokers (IBKR) reported second quarter earnings that fell compared to the same period a year ago. The online broker brought in 36 cents per share compared to 44 cents per share last year. Net revenues dropped 4.7 percent from a year ago to $369 million. The 36 cents per share figure did best analysts estimates by a penny. Revenues came in $4 million short of analysts expectations.
The electronic brokerage segment fared pretty well in the quarter. Daily Average Revenue Trades (DARTs) were up five percent from a year ago to 648,000. The electronic brokerage segment showed a pretax profit margin of 62 percent in the quarter. Customer accounts increased 15 percent to 357,000. Commission and execution fees dipped by three percent from a year ago driven by lower customer option contracts and stock shares volume. Overall, income before taxes grew two percent versus a year ago, and revenues grew by eight percent in the electronic brokerage segment of the business.
It was a different story for the market making business. Profits tumbled 83 percent to just $5 million in the second quarter here. Pretax profit margin dropped to 12 percent from 42 percent a year ago. This was a bit of a surprise to the downside given the increased volatility in June. The market making business has been a difficult one the past couple years.
Shares of IBKR fell 6.78 percent on heavy volume following this earnings release. A one year chart of IBKR shares is posted below.
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