🤯 Picked by our AI, this stock rallied more than Nvidia this month, yielding 94% since MarchSee the stock

Interactive Brokers fourth-quarter earnings rise amid higher interest rates

Published 01/16/2024, 04:19 PM
Updated 01/17/2024, 10:34 AM
© Reuters Interactive Brokers (IBKR) falls on mixed earnings

Investing.com -- Shares in Interactive Brokers (NASDAQ:IBKR) climbed in early trading in New York on Wednesday after the financial services company reported growth in fourth-quarter income.

Trading in options and futures contracts increased, helping offset a 22% downturn in stock share volume, a trend that the company attributed to an  investor desire for instruments that could mitigate risk. Commission revenue edged up by 5% year-over-year to $348 million.

Adjusted diluted earnings per share during the three months until the end of December rose to $1.52 from $1.30 in the corresponding period in 2022. In a note to clients, analysts at Goldman Sachs said "overall" the figures were in line with expectations. 

Meanwhile, net interest income (NII) -- or the difference between interest-bearing assets and liabilities -- jumped by 29% to $730 million, thanks to elevated benchmark interest rates, customer margin loans, and customer credit balances. 

In a call with analysts, Chairman Thomas Peterffy predicted that "on balance" earnings in 2024 will be greater than in 2023. But he warned about the impact of potential Federal Reserve interest rate cuts this year, saying 75 basis points in reductions would hit interest income by around $300M.

"I think it’s going to be a race -- a dead heat -- between lower interest rates, reducing our earnings and higher, more activity increasing our earnings," Peterffy added.

Vahid Karaahmetovic contributed to this report.

Latest comments

Loading next article…
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.