IBKR’s Q3 growth leans on financing balances as trading per account falls

Interactive Brokers’ results released on 15 October show financing contributing more to third-quarter growth than commissions. Net interest income added $187m of the $259m increase in GAAP net revenue: approximately 72%, calculated from the reported figures.[1][2]

Larger balances outweighed narrower interest margins

Average margin loans rose from $70.8bn to $104.0bn, approximately 47%. Net interest margin nevertheless narrowed from 2.16% to 1.99%. The larger balance base outweighed the lower return per dollar.[1]

The margin calculation uses $1.191bn of economic interest income, including $37m booked outside GAAP interest income. Comparing that figure directly with the $1.154bn income-statement total would mix accounting definitions.[1]

CFO Paul Brody said customers’ greater willingness to take investment risk strengthened borrowing. Interest payments on customer cash also grew, offsetting some income. Customer money expands both sides of the financing business.[3]

More accounts did not mean more trading per account

September’s separately published metrics put the quarter-end account base at 5.576m, up 35% year on year. Those are accounts, not unique investors. The report defines daily average revenue trades, or DARTs, as customer orders divided by trading days; they measure order activity rather than shares or money traded.[4]

Brody attributed lower commission per order to smaller orders across products. Customer futures volume rose 13%, customer stock share volume fell 24% and customer options volume eased 1%. He linked the stock decline to low-priced shares. A falling share count does not establish an equivalent decline in trading value.[3]

September illustrates why the order mix matters. Average cleared commissions were $1.94 for stock orders averaging 656 shares, $3.67 for equity-option orders averaging 6.2 contracts and $4.36 for futures orders averaging 3.1 contracts. These monthly averages include exchange, clearing and regulatory charges; they are neither quarterly product revenue nor a universal customer tariff.[4]

Regulatory charges lift revenue and costs together

Brody said SEC regulatory fees were $30m, against zero a year earlier. He described them as largely passed through to customers, increasing commissions and execution costs without increasing profit. Commission growth consequently overstates the growth in revenue retained from trading.[3]

The underlying SEC order set the Section 31 rate at $20.60 per $1m of covered securities sales from 4 April 2026. The obligation applies to exchanges and securities associations.[5]

The next interest-rate move still matters

Brody estimated that a quarter-point US benchmark-rate change would alter annual net interest income by about $83m in the same direction, holding the 30 September balance base constant. Growth in those balances would change the sensitivity. This is a company scenario, not an earnings forecast.[3]

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