Item 1. FINANCIAL STATEMENTS (Unaudited)

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Item 1. FINANCIAL STATEMENTS (Unaudited)

Interactive Brokers Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Financial Condition

(Unaudited)

June 30,December 31,
(in millions, except share amounts)20252024
Assets
Cash and cash equivalents$4,688$3,633
Cash - segregated for regulatory purposes45,05736,600
Securities - segregated for regulatory purposes36,97227,846
Securities borrowed10,1455,369
Securities purchased under agreements to resell9,5296,575
Financial instruments owned, at fair value
Financial instruments owned3,7771,847
Financial instruments owned and pledged as collateral7977
Total financial instruments owned, at fair value3,8561,924
Receivables
Customers, less allowance for credit losses of $23 and $25 as of June 30, 2025 and December 31, 202465,34664,432
Brokers, dealers, and clearing organizations4,0742,196
Interest454446
Total receivables69,87467,074
Other assets1,3541,121
Total assets$181,475$150,142
Liabilities and equity
Short-term borrowings$8$14
Securities loaned21,22916,248
Financial instruments sold, but not yet purchased, at fair value494293
Payables
Customers138,417115,343
Brokers, dealers, and clearing organizations1,682476
Affiliate180195
Accounts payable, accrued expenses and other liabilities664665
Interest283311
Total payables141,226116,990
Total liabilities162,957133,545
Commitments, contingencies and guarantees (see Note 13)
Equity
Stockholders’ equity
Common stock, $0.01 par value per share
Class A – Authorized - 4,000,000,000 shares, Issued - 442,087,364 and 436,244,236 shares, Outstanding – 441,362,243 and 435,618,452 shares as of June 30, 2025 and December 31, 202411
Class B – Authorized - 1,000 shares, Issued and Outstanding – 400 shares as of June 30, 2025 and December 31, 2024——
Additional paid-in capital1,8861,816
Retained earnings2,8902,515
Accumulated other comprehensive income, net of income taxes of $0 as of both June 30, 2025 and December 31, 202462(45)
Treasury stock, at cost, 725,121 and 625,784 shares as of June 30, 2025 and December 31, 2024(14)(7)
Total stockholders’ equity4,8254,280
Noncontrolling interests13,69312,317
Total equity18,51816,597
Total liabilities and equity$181,475$150,142

See accompanying notes to the condensed consolidated financial statements.

Interactive Brokers Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

Three Months Ended June 30,Six Months Ended June 30,
(in millions, except share or per share amounts)2025202420252024
Revenues
Commissions$516$406$1,030$785
Other fees and services6268140127
Other income (loss)42(36)107(18)
Total non-interest income6204381,277894
Interest income1,8911,8283,6093,588
Interest expense(1,031)(1,036)(1,979)(2,049)
Total net interest income8607921,6301,539
Total net revenues1,4801,2302,9072,433
Non-interest expenses
Execution, clearing and distribution fees116115237216
Employee compensation and benefits163146317291
Occupancy, depreciation and amortization24254851
Communications11102120
General and administrative6152123102
Customer bad debt1227
Total non-interest expenses376350748687
Income before income taxes1,1048802,1591,746
Income tax expense9871189142
Net income1,0068091,9701,604
Less net income attributable to noncontrolling interests7826301,5331,250
Net income available for common stockholders$224$179$437$354
Earnings per share
Basic$0.51$0.42$1.00$0.82
Diluted$0.51$0.41$0.99$0.82
Weighted average common shares outstanding
Basic438,457,863430,876,080437,083,330429,579,700
Diluted441,439,924434,507,344440,459,081433,552,552
Comprehensive income
Net income available for common stockholders$224$179$437$354
Other comprehensive income
Cumulative translation adjustment, before income taxes79(2)107(28)
Income taxes related to items of other comprehensive income————
Other comprehensive income (loss), net of tax79(2)107(28)
Comprehensive income available for common stockholders$303$177$544$326
Comprehensive income attributable to noncontrolling interests
Net income attributable to noncontrolling interests$782$630$1,533$1,250
Other comprehensive income - cumulative translation adjustment227(8)306(84)
Comprehensive income attributable to noncontrolling interests$1,009$622$1,839$1,166

See accompanying notes to the condensed consolidated financial statements.

Interactive Brokers Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Ca****sh Flows

(Unaudited)

Six Months Ended June 30,
(in millions)20252024
Cash flows from operating activities
Net income$1,970$1,604
Adjustments to reconcile net income to net cash from operating activities
Deferred income taxes86
Depreciation and amortization3034
Amortization of right-of-use assets1514
Employee stock plan compensation5954
Unrealized (gains) losses on other investments, net(33)(5)
Customer bad debt expense27
Shares distributed to customers under IBKR Promotions1711
Change in operating assets and liabilities
Securities - segregated for regulatory purposes(9,126)7,068
Securities borrowed(4,776)(383)
Securities purchased under agreements to resell(2,954)(707)
Financial instruments owned, at fair value(1,928)(277)
Receivables from customers(915)(10,787)
Other receivables(1,886)(295)
Other assets(191)(104)
Securities loaned4,9814,335
Financial instruments sold, but not yet purchased, at fair value201280
Payable to customers23,0742,361
Other payables1,17588
Net cash provided by operating activities9,7233,304
Cash flows from investing activities
Purchases of other investments(38)(4)
Purchase of property, equipment and intangible assets(30)(23)
Net cash used in investing activities(68)(27)
Cash flows from financing activities
Short-term borrowings, net(6)(6)
Dividends paid to stockholders(62)(38)
Distributions to noncontrolling interests(484)(404)
Repurchases of common stock for employee tax withholdings(84)(54)
Proceeds from the sale of treasury stock9557
Payments made under the Tax Receivable Agreement(15)(25)
Net cash used in financing activities(556)(470)
Effect of exchange rate changes on cash, cash equivalents and restricted cash413(112)
Net increase in cash, cash equivalents and restricted cash9,5122,695
Cash, cash equivalents and restricted cash at beginning of period40,23332,593
Cash, cash equivalents and restricted cash at end of period$49,745$35,288
Cash, cash equivalents and restricted cash
Cash and cash equivalents4,6883,918
Cash segregated for regulatory purposes45,05731,370
Cash, cash equivalents and restricted cash at end of period$49,745$35,288
Supplemental disclosures of cash flow information
Cash paid for interest$2,007$2,040
Cash paid for taxes, net$193$152
Cash paid for amounts included in lease liabilities$21$20
Non-cash financing activities
Adjustments to additional paid-in capital for changes in proportionate ownership in IBG LLC$46$38
Adjustments to noncontrolling interests for changes in proportionate ownership in IBG LLC$(46)$(38)

See accompanying notes to the condensed consolidated financial statements.

Interactive Brokers Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Ch****anges in Equity

Six Months Ended June 30, 2025

(Unaudited)

Class A Common StockAccumulated
AdditionalOtherTotalNon-
IssuedParPaid-InTreasuryRetainedComprehensiveStockholders'controllingTotal
(in millions, except share amounts)SharesValueCapitalStockEarningsIncomeEquityInterestsEquity
Balance, December 31, 2024436,244,236$1$1,816$(7)$2,515$(45)$4,280$12,317$16,597
Issuance of common stock - IBKR Promotion200,0003(10)(7)7—
Common stock distributed pursuant to stock incentive plans
Net distribution of common stock - IBKR Promotion6617
Compensation for stock grants vesting in the future882331
Dividends paid to stockholders - $0.0625 per share(27)(27)(27)
Distributions from IBG LLC to noncontrolling interests—(196)(196)
Adjustments for changes in proportionate ownership in IBG LLC11(1)—
Comprehensive income213282418301,071
Balance, March 31, 2025436,444,236$1$1,828$(11)$2,701$(17)$4,502$12,981$17,483
Common stock distributed pursuant to stock incentive plans5,443,128—
Issuance of common stock - IBKR Promotion200,0002(11)(9)8(1)
Net distribution of common stock - IBKR Promotion88—8
Compensation for stock grants vesting in the future882028
Repurchases of common stock for employee tax withholdings under stock incentive plans(84)(84)(84)
Sales of treasury stock38487895
Dividends paid to stockholders - $0.08 per share(35)(35)(35)
Distributions from IBG LLC to noncontrolling interests—(288)(288)
Adjustments for changes in proportionate ownership in IBG LLC4545(45)—
Comprehensive income224793031,0091,312
Balance, June 30, 2025442,087,364$1$1,886$(14)$2,890$62$4,825$13,693$18,518

‎

Interactive Brokers Group, Inc. and Subsidiaries

Condensed Consolidated Statements of Changes in Equity

Six Months Ended June 30, 2024

(Unaudited)

Class A Common StockAccumulated
AdditionalOtherTotalNon-
IssuedParPaid-InTreasuryRetainedComprehensiveStockholders'controllingTotal
(in millions, except share amounts)SharesValueCapitalStockEarningsIncomeEquityInterestsEquity
Balance, December 31, 2023428,715,712$1$1,726$(3)$1,852$8$3,584$10,483$14,067
Issuance of common stock - IBKR Promotion200,0001(4)(3)3—
Common stock distributed pursuant to stock incentive plans—
Net distribution of common stock - IBKR Promotion4415
Compensation for stock grants vesting in the future882028
Dividends paid to stockholders - $0.025 per share(11)(11)(11)
Distributions from IBG LLC to noncontrolling interests—(123)(123)
Adjustments for changes in proportionate ownership in IBG LLC11(1)—
Comprehensive income175(26)149544693
Balance, March 31, 2024428,915,712$1$1,736$(3)$2,016$(18)$3,732$10,927$14,659
Common stock distributed pursuant to stock incentive plans5,389,184——
Issuance of common stock - IBKR Promotion200,0002(6)(4)4—
Net distribution of common stock - IBKR Promotion55—5
Compensation for stock grants vesting in the future662026
Repurchases of common stock for employee tax withholdings under stock incentive plans(54)(54)(54)
Sales of treasury stock15455257
Dividends paid to stockholders - $0.0625 per share(27)(27)(27)
Distributions from IBG LLC to noncontrolling interests—(281)(281)
Adjustments for changes in proportionate ownership in IBG LLC3737(37)—
Comprehensive income179(2)177622799
Balance, June 30, 2024434,504,896$1$1,782$(4)$2,168$(20)$3,927$11,257$15,184

See accompanying notes to the condensed consolidated financial statements.

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

1. Organization of Business

Interactive Brokers Group, Inc. (“IBG, Inc.”) is a Delaware holding company whose primary asset is its ownership of approximately 26.0% of the membership interests of IBG LLC, which, in turn, owns operating subsidiaries (collectively, “IBG LLC”). IBG, Inc. together with IBG LLC and its consolidated subsidiaries (collectively, “the Company”), is an automated global electronic broker specializing in executing and clearing trades in stocks, options, futures, foreign exchange instruments, bonds, mutual funds, exchange-traded funds (“ETFs”), precious metals, and forecast contracts on more than 160 electronic exchanges and market centers around the world and offering custody, prime brokerage, securities and margin lending services to customers. In addition, the Company’s customers can use its trading platform to trade certain cryptocurrencies through third-party cryptocurrency service providers that execute, clear and custody the cryptocurrencies. In the United States of America (“U.S.”), the Company conducts its business primarily from its headquarters in Greenwich, Connecticut and from Chicago, Illinois. Abroad, the Company conducts its business through offices located in Canada, the United Kingdom, Ireland, Switzerland, Hungary, India, China (Hong Kong and Shanghai), Japan, Singapore, and Australia. As of June 30, 2025, the Company had 3,087 employees worldwide.

IBG LLC is a Connecticut limited liability company that conducts its business through its significant operating subsidiaries: Interactive Brokers LLC (“IB LLC”); IBKR Securities Services LLC (“IBKRSS”); Interactive Brokers Canada Inc. (“IBC”); Interactive Brokers (U.K.) Limited (“IBUK”); Interactive Brokers Ireland Limited (“IBIE”); IBKR Financial Services AG (“IBKRFS”); Interactive Brokers (India) Private Limited (“IBI”); Interactive Brokers Hong Kong Limited (“IBHK”); Interactive Brokers Securities Japan, Inc. (“IBSJ”); Interactive Brokers Singapore Private Limited (“IBSG”); and Interactive Brokers Australia Pty Limited (“IBA”).

Certain operating subsidiaries are members of various securities and commodities exchanges in North America, Europe and the Asia/Pacific region and are subject to regulatory capital and other requirements (see Note 15). IB LLC, IBKRSS, IBC, IBUK, IBIE, IBI, IBHK, IBSJ, IBSG and IBA carry securities accounts for customers or perform custodial functions relating to customer securities.

2. Significant Accounting Policies

Basis of Presentation

These condensed consolidated financial statements are presented in U.S. dollars and have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”) and pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding financial reporting with respect to Form 10-Q.

These condensed consolidated financial statements are unaudited and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s 2024 Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 27, 2025. The condensed consolidated financial information as of December 31, 2024 has been derived from the audited financial statements not included herein.

These condensed consolidated financial statements include the accounts of the Company and its consolidated subsidiaries and reflect all adjustments of a normal and recurring nature that are, in the opinion of management, necessary for the fair presentation of the results for the periods presented. The operating results for interim periods are not necessarily indicative of the operating results for the entire year.

On April 15, 2025, the Company announced its intention to effect a four-for-one forward split of its common stock in the form of a stock dividend. This was executed by the filing of an amendment to the Company’s Certificate of Incorporation, which was approved by the Company’s Board of Directors and the Company’s majority stockholder on April 14, 2025 and on April 22, 2025, respectively, that, among other things (i) increased the Company’s authorized shares of Class A common stock to 4,000,000,000 shares from 1,000,000,000 shares and (ii) increased the Company’s authorized shares of Class B Common Stock to 1,000 shares from 100 shares to accommodate the stock split. Each holder of record of common stock as of the close of market on June 16, 2025, received three additional shares of common stock. All prior period share, per share amounts and stock incentive awards presented herein have been retroactively adjusted to reflect the stock split.

Principles of Consolidation, including Noncontrolling Interests

These condensed consolidated financial statements include the accounts of IBG, Inc. and its majority and wholly-owned subsidiaries. As sole managing member of IBG LLC, IBG, Inc. exerts control over IBG LLC’s operations. In accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810, “Consolidation,” the Company consolidates IBG LLC’s financial statements and records the interests in IBG LLC that it does not own as noncontrolling interests.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

The Company’s policy is to consolidate all other entities in which it owns more than 50% unless it does not have control and any potential variable interest entities (“VIEs”) where the Company is deemed to be the primary beneficiary when it has the power to make the decisions that most significantly affect the economic performance of the VIE and has the obligation to absorb significant losses or the right to receive benefits that could potentially be significant to the VIE. As of June 30, 2025, the Company was not the primary beneficiary of any VIEs. All inter-company balances and transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and disclosures in these condensed consolidated financial statements and accompanying notes. These estimates and assumptions are based on judgment and the best available information at the time. Therefore, actual results could differ materially from those estimates. Such estimates include the allowance for credit losses, valuation of certain investments, compensation accruals, current and deferred income taxes, and contingency reserves.

Fair Value

Substantially all of the Company’s assets and liabilities, including financial instruments, are carried at fair value based on observable market prices and are marked to market, or are assets and liabilities which are short-term in nature and are carried at amounts that approximate fair value.

The Company applies the fair value hierarchy in accordance with FASB ASC Topic 820, “Fair Value Measurement” (“ASC Topic 820”), to prioritize the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy are:

Level 1Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
Level 2Quoted prices for similar assets in an active market, quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly.
Level 3Prices or valuations that require inputs that are both significant to fair value measurement and unobservable.

Financial instruments owned, at fair value, and financial instruments sold, but not yet purchased, at fair value are generally classified as Level 1 of the fair value hierarchy. The Company’s Level 1 financial instruments, which are valued using quoted market prices as published by exchanges and clearing houses or otherwise broadly distributed in active markets, include active listed stocks, options, warrants and U.S. and foreign government securities. The Company does not adjust quoted prices for financial instruments classified as Level 1 of the fair value hierarchy, even if the Company may hold a large position whereby a purchase or sale could reasonably be expected to impact quoted prices.

Currency forward contracts are valued using broadly distributed bank and broker prices and are classified as Level 2 of the fair value hierarchy since inputs to their valuation can generally be corroborated by market data. Precious metals are valued using an internal model, which incorporates the exchange-traded futures price of the underlying instruments, benchmark interest rates and estimated storage costs, and are classified as Level 2 of the fair value hierarchy since the significant inputs to their valuation are observable. Other securities that are not traded in active markets are also classified as Level 2 of the fair value hierarchy. Level 3 financial instruments are comprised of securities that have been delisted or otherwise are no longer tradable in active markets and have been valued by the Company based on internal estimates.

Earnings per Share

Earnings per share (“EPS”) is computed in accordance with FASB ASC Topic 260, “Earnings per Share.” Basic EPS is computed by dividing the net income available for common stockholders by the weighted average number of shares outstanding for that period. Diluted EPS is calculated by dividing the net income available for common stockholders by the diluted weighted average shares outstanding for that period. Diluted EPS includes the determinants of basic EPS and, in addition, reflects the dilutive effect of shares of common stock estimated to be distributed in the future under the Company’s stock-based compensation plans, with no adjustments to net income available for common stockholders for potentially dilutive common shares.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Current Expected Credit Losses

The Company follows FASB ASC Topic 326 – “Financial Instruments – Credit Losses” (“ASC Topic 326”) which applies to financial assets measured at amortized cost, held-to-maturity debt securities and off-balance sheet credit exposures. For on-balance sheet assets, an allowance must be recognized at the origination or purchase of in-scope assets and represents the expected credit losses over the contractual life of those assets. Expected credit losses on off-balance sheet credit exposures must be estimated over the contractual period the Company is exposed to credit risk as a result of a present obligation to extend credit. The impact to the current period is not material since the Company’s in-scope assets are primarily subject to collateral maintenance provisions for which the Company elected to apply the practical expedient of reporting the difference between the fair value of the collateral and the amortized cost for the in-scope assets as the allowance for current expected credit losses.

Cash and Cash Equivalents

Cash and cash equivalents consist of deposits with banks and all highly liquid investments, with maturities of three months or less, that are not segregated and deposited for regulatory purposes or to meet margin requirements at clearing houses and clearing banks.

Cash and Securities – Segregated for Regulatory Purposes

As a result of customer activities, certain operating subsidiaries are obligated by rules mandated by their primary regulators to segregate or set aside cash or qualified securities to satisfy such regulations, which have been promulgated to protect customer assets. Restricted cash represents cash and cash equivalents that are subject to withdrawal or usage restrictions. Cash segregated for regulatory purposes meets the definition of restricted cash and is included in “Cash, cash equivalents and restricted cash” in the condensed consolidated statements of cash flows.

The table below presents the composition of the Company’s securities segregated for regulatory purposes for the periods indicated.

June 30,December 31,
20252024
(in millions)
U.S. and foreign government securities$5,956$6,460
Municipal securities6433
Securities purchased under agreements to resell 128,24921,353
Securities borrowed 12,703-
$36,972$27,846

1.These balances are collateralized by U.S. government securities.

Securities Borrowed and Securities Loaned

Securities borrowed and securities loaned are recorded at the amount of the cash collateral advanced or received. Securities borrowed transactions require the Company to provide counterparties with collateral, which may be in the form of cash, letters of credit or other securities. With respect to securities loaned, the Company receives collateral, which may be in the form of cash or other securities in an amount generally in excess of the fair value of the securities loaned. The Company monitors the market value of securities borrowed and loaned daily, with additional collateral obtained or refunded as permitted contractually. The Company’s policy is to net, in the condensed consolidated statements of financial condition, securities borrowed and securities loaned contracts entered into with the same counterparty that meet the offsetting requirements prescribed in FASB ASC Topic 210-20, “Balance Sheet – Offsetting” (“ASC Topic 210-20”).

Securities lending fees received and paid by the Company are included in “Interest income” and “Interest expense,” respectively, in the condensed consolidated statements of comprehensive income.

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Securities Purchased Under Agreements to Resell and Securities Sold Under Agreements to Repurchase

Securities purchased under agreements to resell and securities sold under agreements to repurchase, which are reported as collateralized financing transactions, are recorded at contract value, which approximates fair value. To ensure that the fair value of the underlying collateral remains sufficient, the collateral is valued daily with additional collateral obtained or excess collateral returned, as permitted under contractual provisions. The Company’s policy is to net, in the condensed consolidated statements of financial condition, securities purchased under agreements to resell transactions and securities sold under agreements to repurchase transactions entered into with the same counterparty that meet the offsetting requirements prescribed in ASC Topic 210-20.

Financial Instruments Owned and Financial Instruments Sold, But Not Yet Purchased, at Fair Value

Financial instrument transactions are accounted for on a trade date basis. Financial instruments owned and financial instruments sold, but not yet purchased are stated at fair value based upon quoted market prices, or if not available, are valued by the Company based on internal estimates (see Fair Value above). The Company’s financial instruments pledged to counterparties where the counterparty has the right, by contract or custom, to sell or repledge the financial instruments are reported as “Financial instruments owned and pledged as collateral” in the condensed consolidated statements of financial condition.

Customer Receivables and Payables

Receivables from and payables to customers include amounts due on cash and margin transactions, including futures contracts transacted on behalf of customers. Securities owned by customers, including those that collateralize margin loans or other similar transactions, are not reported in the condensed consolidated statements of financial condition. Amounts receivable from customers that are determined by management to be uncollectible are recorded as “Customer bad debt” expense in the condensed consolidated statements of comprehensive income (see Current Expected Credit Losses above).

Receivables from and Payables to Brokers, Dealers and Clearing Organizations

Receivables from and payables to brokers, dealers and clearing organizations include net receivables and payables from unsettled trades, including amounts related to futures and options on futures contracts executed on behalf of customers, amounts receivable for securities not delivered by the Company to the purchaser by the settlement date (“fails to deliver”) and cash deposits. Payables to brokers, dealers and clearing organizations also include amounts payable for securities not received by the Company from a seller by the settlement date (“fails to receive”).

Investments

The Company makes certain strategic investments related to its business which are included in “Other assets” in the condensed consolidated statements of financial condition. The Company accounts for these investments as follows:

Under the equity method of accounting as required under FASB ASC Topic 323, “Investments – Equity Method and Joint Ventures.” These investments, including where the investee is a limited partnership or limited liability company, are recorded at the fair value amount of the Company’s initial investment and are adjusted each period for the Company’s share of the investee’s income or loss. Contributions paid to and distributions received from equity method investees are recorded as additions or reductions, respectively, to the respective investment balance.

At fair value, if the investment in equity securities has a readily determinable fair value.

At adjusted cost, if the investment does not have a readily determinable fair value. Adjusted cost represents the historical cost, less impairment if any. If the Company identifies observable price changes in orderly transactions for the identical or a similar investment of the same issuer, the Company measures the equity security at fair value as of the date that the observable transaction occurred in accordance with FASB ASC Topic 321, “Investments in Equity Securities.”

A judgmental aspect of accounting for investments is evaluating whether a decline in the value of an investment has occurred. The evaluation of impairment is dependent on specific quantitative and qualitative factors and circumstances surrounding an investment, including recurring operating losses, credit defaults and subsequent rounds of financing. Most of the Company’s equity investments do not have readily determinable market values. All investments are reviewed for changes in circumstances or occurrence of events that suggest the Company’s investment may not be recoverable. An impairment loss, if any, is recognized in the period the determination is made.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

The table below presents the composition of the Company’s investments for the periods indicated.

June 30,December 31,
20252024
(in millions)
Equity method investments 1$194$172
Investments in equity securities at adjusted cost 23929
Investments in equity securities at fair value 24832
Investments in exchange memberships and equity securities of certain exchanges 222
$283$235

1.The Company’s share of income or losses is included in “Other income” in the condensed consolidated statements of comprehensive income.

2.These investments do not qualify for the equity method of accounting. Dividends received are included in “Other income” in the condensed consolidated statements of comprehensive income.

Property, Equipment and Intangible Assets

Property, equipment and intangible assets, which are included in “Other assets” in the condensed consolidated statements of financial condition, consist of leasehold improvements, computer equipment, software developed for the Company’s internal use, office furniture and equipment.

Property and equipment are recorded at historical cost, less accumulated depreciation and amortization. Additions and improvements that extend the lives of assets are capitalized, while expenditures for repairs and maintenance are expensed as incurred. Depreciation and amortization are computed using the straight-line method. Equipment is depreciated over the estimated useful lives of the assets, while leasehold improvements are amortized over the lesser of the estimated economic useful life of the asset or the term of the lease. Computer equipment is depreciated over three to five years and office furniture and equipment are depreciated over five to seven years. Intangible assets with a finite life are amortized on a straight-line basis over their estimated useful lives of three to five years, and tested for recoverability whenever events indicate that the carrying amounts may not be recoverable. Qualifying costs for internally developed software are capitalized and amortized over the expected useful life of the developed software, not to exceed three years. Upon retirement or disposition of property and equipment, the cost and related accumulated depreciation are removed from the condensed consolidated statements of financial condition and any resulting gain or loss is recorded in “Other income” in the condensed consolidated statements of comprehensive income. Fully depreciated (or amortized) assets are retired periodically throughout the year.

Leases

The Company reviews all relevant contracts to determine if the contract contains a lease at its inception date. A contract contains a lease if the contract conveys to the company the right to control the use of an underlying asset for a period of time in exchange for consideration. If the Company determines that a contract contains a lease, it recognizes, in the condensed consolidated statements of financial condition, a lease liability and a corresponding right-of-use asset on the commencement date of the lease. The lease liability is initially measured at the present value of the future lease payments over the lease term using the rate implicit in the lease or, if not readily determinable, the Company’s secured incremental borrowing rate. An operating lease right-of-use asset is initially measured at the value of the lease liability minus any lease incentives and initial direct costs incurred plus any prepaid rent.

The Company’s leases are classified as operating leases and consist of real estate leases for office space, data centers and other facilities. Each lease liability is measured using the Company’s secured incremental borrowing rate, which is based on an internally developed yield curve using interest rates of third parties’ corporate debt issued with a similar risk profile as the Company and a duration similar to the lease term. The Company’s leases have remaining terms of less than one year to twelve years, some of which include options to extend the lease term, and some of which include options to terminate the lease upon notice. The Company considers these options when determining the lease term used to calculate the right-of-use asset and the lease liability when the Company is reasonably certain it will exercise such option. ‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

The Company’s operating leases contain both lease components and non-lease components. Non-lease components are distinct elements of a contract that are not related to securing the use of the underlying assets, such as common area maintenance and other management costs. The Company elected to measure the lease liability by combining the lease and non-lease components as a single lease component. As such, the Company includes the fixed payments and any payments that depend on a rate or index that relate to the lease and non-lease components in the measurement of the lease liability. Some of the non-lease components are variable and not based on an index or rate, and as a result, are not included in the measurement of the right-of-use asset or lease liability.

Operating lease expense is recognized on a straight-line basis over the lease term and is included in “Occupancy, depreciation and amortization” expense in the Company’s condensed consolidated statements of comprehensive income.

Comprehensive Income and Foreign Currency Translation

The Company’s operating results are reported in the condensed consolidated statements of comprehensive income pursuant to FASB ASC Topic 220, “Comprehensive Income.”

Comprehensive income consists of two components: net income and other comprehensive income (“OCI”). The Company’s OCI is comprised of gains and losses resulting from translating foreign currency financial statements of non-U.S. subsidiaries, net of related income taxes, where applicable. In general, the practice and intention of the Company is to reinvest the earnings of its non-U.S. subsidiaries in those operations; therefore, tax is usually not accrued on OCI.

The Company’s non-U.S. domiciled subsidiaries have a functional currency that is other than the U.S. dollar. Such subsidiaries’ assets and liabilities are translated into U.S. dollars at period-end exchange rates, and revenues and expenses are translated at average exchange rates prevailing during the period. Adjustments that result from translating amounts from a subsidiary’s functional currency to the U.S. dollar (as described above) are reported net of tax, where applicable, in “Accumulated other comprehensive income” in the condensed consolidated statements of financial condition.

Revenue Recognition

Commissions

Commissions earned for executing and/or clearing transactions are accrued on a trade date basis and are reported as “Commissions” in the condensed consolidated statements of comprehensive income. Commissions also include payments for order flow income received from IBKR LiteSM liquidity providers. The Company’s IBKR LiteSM offering provides commission-free trades on U.S. exchange-listed stocks and ETFs and generates no commission revenues from customers on these trades. See Note 8 for further information on revenue from contracts with customers.

Other Fees and Services

The Company earns fee income on services provided to customers, which includes market data fees, risk exposure fees, payments for order flow from exchange-mandated programs, Insured Bank Deposit Sweep Program fees (“FDIC sweep fees”), and other fees and services charged to customers. Fee income is recognized either daily or monthly. See Note 8 for further information on revenue from contracts with customers.

Interest Income and Expense

The Company earns interest income and incurs interest expense primarily in connection with its electronic brokerage customer business and its securities lending activities, which are recorded on an accrual basis and are included in “Interest income” and “Interest expense,” respectively, in the condensed consolidated statements of comprehensive income.

Principal Transactions

Principal transactions include gains and losses as a result of changes in the fair value of financial instruments owned, at fair value, financial instruments sold, but not yet purchased, at fair value, and other investments measured at fair value (i.e., unrealized gains and losses) and realized gains and losses related to the Company’s principal transactions. These include net gains and losses on stocks, options, U.S. and foreign government securities, municipal securities, futures, foreign exchange, precious metals and other derivative instruments, which are reported on a net basis in “Other income” in the condensed consolidated statements of comprehensive income. Dividends are integral to the valuation of stocks. Accordingly, dividend income and expense attributable to financial instruments owned, at fair value and financial instruments sold, but not yet purchased, at fair value, are reported on a net basis in “Other income” in the condensed consolidated statements of comprehensive income.

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Foreign Currency Gains and Losses

Foreign currency balances are assets and liabilities in currencies other than the Company’s functional currency. At every reporting date, the Company revalues its foreign currency balances to its functional currency at the spot exchange rate and records the associated foreign currency gains and losses. These foreign currency gains and losses are reported in the condensed consolidated statements of comprehensive income, as follows: (a) foreign currency gains and losses related to the Company’s currency diversification strategy are reported in “Other income”; (b) foreign currency gains and losses arising from currency swap transactions are reported in “Interest income” or “Interest expense”; and (c) all other foreign currency gains and losses are reported in “Other income.”

Rebates

Rebates consist of volume discounts, credits, or payments received from exchanges or other market centers related to the placement and/or removal of liquidity from the marketplace and are recorded on an accrual basis. Rebates are recorded net within “Execution, clearing and distribution fees” in the condensed consolidated statements of comprehensive income. Rebates received for trades executed on behalf of customers that elect tiered pricing are passed, in whole or part, to these customers, and such pass-through amounts are recorded net within “Commissions” in the condensed consolidated statements of comprehensive income.

Stock**-**Based Compensation

The Company follows FASB ASC Topic 718, “Compensation - Stock Compensation” (“ASC Topic 718”), to account for its stock-based compensation plans. ASC Topic 718 requires all share-based payments to employees to be recognized in the condensed consolidated financial statements using a fair value-based method. Grants, which are denominated in U.S. dollars, are communicated to employees in the year of the grant, thereby establishing the fair value of each grant. The fair value of awards granted to employees are generally expensed as follows: 50% in the year of grant in recognition of the plans’ post-employment provisions (as described below) and the remaining 50% over the related vesting period utilizing the “graded vesting” method permitted under ASC Topic 718. In the case of “retirement eligible” employees (those employees older than 59), 100% of awards are expensed when granted.

Awards granted under stock-based compensation plans are subject to the plans’ post-employment provisions in the event an employee ceases employment with the Company. The plans provide that employees who discontinue employment with the Company without cause and continue to meet the terms of the plans’ post-employment provisions will be eligible to earn 50% of previously granted but not yet earned awards, unless the employee is over the age of 59, in which case the employee would be eligible to receive 100% of previously granted but not yet earned awards.

Income Taxes

The Company accounts for income taxes in accordance with FASB ASC Topic 740, “Income Taxes” (“ASC Topic 740”). The Company’s income tax expense, deferred tax assets and liabilities, and reserves for unrecognized tax benefits are based on enacted tax laws (see Note 11) and reflect management’s best assessment of estimated future taxes to be paid. The Company is subject to income taxes in the U.S. and numerous foreign jurisdictions. Determining income tax expense requires significant judgment and estimates.

Deferred income tax assets and liabilities arise from temporary differences between the tax and financial statement recognition of underlying assets and liabilities. In evaluating the ability to recover deferred tax assets within the jurisdictions from which they arise, the Company considers all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, projected future taxable income, tax-planning strategies and results of recent operations. In projecting future taxable income, historical results are adjusted for changes in accounting policies and incorporate assumptions including the amount of future state, federal and foreign pre-tax operating income, the reversal of temporary differences, and the implementation of feasible and prudent tax-planning strategies. These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates the Company is using to manage the underlying businesses. In evaluating the objective evidence that historical results provide, three years of cumulative operating income (loss) are considered. Deferred income taxes have not been provided for U.S. tax liabilities or for additional foreign taxes on the unremitted earnings of foreign subsidiaries that have been indefinitely reinvested.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

The calculation of the Company’s tax liabilities involves dealing with uncertainties in the application of complex tax laws and regulations in a multitude of jurisdictions across the Company’s global operations. Changes in tax laws and rates could also affect recorded deferred tax assets and liabilities in the future. On December 15, 2022, the European Union (“EU”) formally adopted the EU’s Pillar Two Directive, effective January 1, 2024, which provides for a minimum effective tax rate of 15%, as established by the Organization for Economic Cooperation and Development (“OECD”) Pillar Two Framework. A significant number of other countries have either already or are expected to implement similar legislation with varying effective dates. The Company is continuing to evaluate the potential impact of the EU’s Pillar Two Directive and similar legislations adopted by other countries (collectively, “Pillar Two Directives”), including the statement issued by the G7 countries on June 28, 2025, providing a “side-by-side system” for U.S. parented groups such as the Company. Based on current guidance, the Company believes that its results of operations, financial condition and cash flows will not be materially impacted by such Pillar Two Directives.

The Company records tax liabilities in accordance with ASC Topic 740 and adjusts these liabilities when management’s judgment changes as a result of the evaluation of new information not previously available. Because of the complexity of some of these uncertainties, the ultimate resolution may result in payments that are different from the current estimates of these tax liabilities. These differences will be reflected as increases or decreases to income tax expense in the period in which new information becomes available.

The Company recognizes a tax benefit from an uncertain tax position only when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, on the basis of the technical merits. A tax position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized on settlement.

The Company recognizes interest related to income tax matters as interest income or interest expense and penalties related to income tax matters as “Income tax expense” in the condensed consolidated statements of comprehensive income.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

FASB Standards issued but not adopted as of June 30, 2025

Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40) ‎ ‎Issued November 2024Requires companies to disclose the amounts of employee compensation, depreciation, and intangible asset amortization included in each relevant expense caption. Requires companies to include certain amounts already required to be disclosed under current U.S. GAAP in the same disclosure as the other disaggregation requirements. Disclose the total amount of selling expenses and the company's definition of selling expenses. Requires companies to disclose a qualitative description of amounts remaining in relevant expense captions that are not separately disaggregated.Effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company is currently assessing the impact to its consolidated financial statements.
Income Taxes (Topic 740) ‎ ‎Issued December 2023Requires companies to disclose specific categories in the rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. Requires companies to disclose the amount of income taxes paid disaggregated by federal, state, and foreign taxes and amount of income taxes paid disaggregated by individual jurisdictions in which income taxes paid is equal to or greater than five percent of total income taxes paid. Requires companies to disclose income (or loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign and income tax expense (or benefit) from continuing operations disaggregated by federal, state, and foreign.Effective for annual reporting periods beginning after December 15, 2024. The Company is currently assessing the impact to its consolidated financial statements. The Company plans to adopt the guidance for the fiscal year ending December 31, 2025.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

3. Trading Activities and Related Risks

Trading activities expose the Company to market and credit risks. These risks are managed in accordance with established risk management policies and procedures. To accomplish this, management has established a risk management process that includes:

a regular review of the risk management process by executive management as part of its oversight role;

defined risk management policies and procedures supported by a rigorous analytic framework; and

articulated risk tolerance levels as defined by executive management that are regularly reviewed to ensure that the Company’s risk-taking is consistent with its business strategy, its capital structure, and current and anticipated market conditions.

Market Risk

The Company is exposed to various market risks. Exposures to market risks arise from equity price risk, foreign currency exchange rate fluctuations and changes in interest rates. The Company seeks to mitigate market risk associated with trading inventories by employing hedging strategies that correlate rate, price and spread movements of trading inventories and related financing and hedging activities. The Company uses a combination of cash instruments and exchange-traded derivatives to hedge its market exposures. The Company does not apply hedge accounting. The following discussion describes the types of market risk faced:

Equity Price Risk

Equity price risk arises from the possibility that equity security prices will fluctuate, affecting the value of equity securities and other instruments that derive their value from a particular stock, a defined basket of stocks, or a stock index. The Company is subject to equity price risk primarily in financial instruments owned, at fair value and financial instruments sold, but not yet purchased, at fair value. The Company attempts to limit such risks by continuously reevaluating prices and by diversifying its portfolio across many different options, futures and underlying securities and avoiding concentrations of positions based on the same underlying security.

Interest Rate Risk

Interest rate risk arises from the possibility that changes in interest rates will affect the value of financial instruments. The Company is exposed to interest rate risk on cash and margin balances, positions carried in equity and fixed income securities, options, futures and on its borrowings. These risks are managed through investment policies and by entering into interest rate futures contracts.

Currency Risk

Currency risk arises from the possibility that fluctuations in foreign exchange rates will impact the value of financial instruments. The Company manages this risk using spot (i.e., cash) currency transactions, currency futures contracts and currency forward contracts. The Company actively manages its currency exposure using a currency diversification strategy that is based on a defined basket of ten currencies internally referred to as the “GLOBAL.” These strategies minimize the fluctuation of the Company’s equity as expressed in GLOBALs, thereby diversifying its risk in alignment with these global currencies, weighted by the Company’s view of their importance. As the Company’s financial results are reported in U.S. dollars, the change in the value of the GLOBAL as expressed in U.S. dollars affects the Company’s earnings. The impact of this currency diversification strategy in the Company’s earnings is included in “Other income” in the condensed consolidated statements of comprehensive income.

Credit Risk

The Company is exposed to the risk of loss if a customer, counterparty or issuer fails to perform its obligations under contractual terms (“default risk”). Both cash instruments and derivatives expose the Company to default risk. The Company has established policies and procedures for mitigating credit risk on principal transactions, including reviewing and establishing limits for credit exposure, maintaining collateral and continually assessing the creditworthiness of counterparties.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

The Company’s credit risk is limited as contracts entered into are settled directly at securities and commodities clearing houses or are settled through member firms and banks with substantial financial and operational resources. Over-the-counter transactions, such as securities lending and contracts for differences (“CFDs”), are marked to market daily and are conducted with counterparties that have undergone a thorough credit review. The Company seeks to control the risks associated with its customer margin activities by requiring customers to maintain collateral in compliance with regulatory and internal guidelines.

In the normal course of business, the Company executes, settles and finances various customer securities transactions. Execution of these transactions includes the purchase and sale of securities which exposes the Company to default risk arising from the potential that customers or counterparties may fail to satisfy their obligations. In these situations, the Company may be required to purchase or sell financial instruments at unfavorable market prices to satisfy obligations to customers or counterparties. Liabilities to other brokers and dealers related to unsettled transactions (i.e., securities fails to receive) are recorded at the amount for which the securities were purchased, and are paid upon receipt of the securities from other brokers or dealers. In the case of aged securities fails to receive, the Company may purchase the underlying security in the market and seek reimbursement for any losses from the counterparty.

For cash management purposes, the Company enters into short-term securities purchased under agreements to resell and securities sold under agreements to repurchase transactions (“repos”) in addition to securities borrowing and lending arrangements, all of which may result in credit exposure in the event the counterparty to a transaction is unable to fulfill its contractual obligations. Repos are collateralized by securities with a market value in excess of the obligation under the contract. Similarly, securities lending agreements are collateralized by deposits of cash or securities. The Company attempts to minimize credit risk associated with these activities by monitoring collateral values daily and requiring additional collateral to be deposited with or returned to the Company as permitted under contractual provisions.

Concentrations of Credit Risk

The Company’s exposure to credit risk associated with its trading and other activities is measured on an individual counterparty basis, as well as by groups of counterparties that share similar attributes. Concentrations of credit risk can be affected by changes in political, industry, or economic factors. To reduce the potential for risk concentration, credit limits are established and exposure is monitored in light of changing counterparty and market conditions. As of June 30, 2025, the Company did not have any material concentrations of credit risk outside the ordinary course of business.

Off**-**Balance Sheet Risks

The Company may be exposed to a risk of loss not reflected in the condensed consolidated financial statements to settle futures and certain over-the-counter contracts at contracted prices, which may require repurchase or sale of the underlying products in the market at prevailing prices. Accordingly, these transactions result in off-balance sheet risk as the Company’s cost to liquidate such contracts may exceed the amounts reported in the Company’s condensed consolidated statements of financial condition.

4. Equity and Earnings per Share

In connection with IBG, Inc.’s initial public offering of Class A common stock (“IPO”) in May 2007, it purchased 10.0% of the membership interests in IBG LLC from IBG Holdings LLC (“Holdings”), became the sole managing member of IBG LLC and began to consolidate IBG LLC’s financial results into its financial statements. Holdings owns all of IBG, Inc.’s Class B common stock, which has voting rights in proportion to its ownership interests in IBG LLC. The table below presents the amount of IBG LLC membership interests held by IBG, Inc. and Holdings as of June 30, 2025.

IBG, Inc.HoldingsTotal
Ownership %26.0%74.0%100.0%
Membership interests441,569,5841,254,573,4161,696,143,000

These condensed consolidated financial statements reflect the results of operations and financial position of IBG, Inc., including consolidation of its investment in IBG LLC and its subsidiaries. The noncontrolling interests in IBG LLC attributable to Holdings are reported as a component of “Total equity” in the condensed consolidated statements of financial condition.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Recapitalization and Post**-**IPO Capital Structure

Immediately before and immediately following the consummation of the IPO, IBG, Inc., Holdings, IBG LLC and the members of IBG LLC consummated a series of transactions collectively referred to herein as the “Recapitalization.” In connection with the Recapitalization, IBG, Inc., Holdings and the historical members of IBG LLC entered into an exchange agreement, dated as of May 3, 2007 (the “Exchange Agreement”), under which the historical members of IBG LLC received membership interests in Holdings in exchange for their membership interests in IBG LLC. Additionally, IBG, Inc. became the sole managing member of IBG LLC.

In connection with the consummation of the IPO, Holdings used the net proceeds to redeem 10.0% of members’ interests in Holdings in proportion to their interests. Immediately following the Recapitalization and IPO, Holdings owned approximately 90% of IBG LLC and 100% of IBG, Inc.’s Class B common stock.

Since the consummation of the IPO and Recapitalization, IBG, Inc.’s equity capital structure has been comprised of Class A and Class B common stock. All shares of common stock have a par value of $0.01 per share and have identical rights to earnings and dividends and in liquidation. The below table presents the authorized, issued, and outstanding shares for the periods indicated.

June 30, 2025December 31, 2024
AuthorizedIssuedOutstandingAuthorizedIssuedOutstanding
Class A common stock4,000,000,000442,087,364441,362,2434,000,000,000436,244,236435,618,452
Class B common stock1,000400400400400400
Preferred stock10,000--10,000--

As a result of a federal income tax election made by IBG LLC applicable to the acquisition of IBG LLC member interests by IBG, Inc., the income tax basis of the assets of IBG LLC acquired by IBG, Inc. have been adjusted based on the amount paid for such interests. Deferred tax assets were recorded as of the IPO date and in connection with subsequent redemptions of Holdings member interests in exchange for common stock. These deferred tax assets are included in “Other assets” in the Company’s condensed consolidated statements of financial condition and are being amortized as additional deferred income tax expense over 15 years from the IPO date and from the additional redemption dates, respectively, as allowable under current tax law. As of June 30, 2025 and December 31, 2024, the unamortized balance of these deferred tax assets was $188 million and $196 million, respectively.

IBG, Inc. also entered into an agreement (the “Tax Receivable Agreement”) with Holdings to pay Holdings (for the benefit of the former members of IBG LLC) 85% of the tax savings that IBG, Inc. actually realizes as the result of tax basis increases. These payables to Holdings are reported as “Payable to affiliate” in the Company’s condensed consolidated statements of financial condition. The remaining 15% is accounted for as a permanent increase to “Additional paid-in capital” in the Company’s condensed consolidated statements of financial condition.

The cumulative amounts of deferred tax assets, payables to Holdings and additional paid-in capital arising from stock offerings from the date of the IPO through June 30, 2025 were $688 million, $585 million and $103 million, respectively. Amounts payable under the Tax Receivable Agreement are payable to Holdings annually following the filing of IBG, Inc.’s federal income tax return. The Company has paid Holdings a cumulative total of $308 million through June 30, 2025 under the terms of the Tax Receivable Agreement.

The Exchange Agreement, as amended, provides for future redemptions of member interests and for the purchase of member interests in IBG LLC by IBG, Inc. from Holdings, which could result in IBG, Inc. acquiring the remaining member interests in IBG LLC that it does not own. On an annual basis, members of Holdings can request redemption of their interests.

At the time of IBG, Inc.’s IPO in 2007, the Company reserved 360 million shares, 1.440 billion shares on a post-split basis, of authorized common stock for future sales and redemptions. From 2008 through 2010, Holdings redeemed 20,053,036 IBG LLC interests with a total value of $114 million, which redemptions were funded using cash on hand at IBG LLC. Upon cash redemption, these IBG LLC interests were retired. From 2011 through 2024, IBG, Inc. issued 161,777,780 shares of common stock (with a fair value of $2.0 billion) directly to Holdings in exchange for an equivalent number of member interests in IBG LLC. On July 30, 2025, the Company filed a Prospectus Supplement on Form 424B5 with the SEC to issue 3,836,000 shares of common stock (with a fair value of $254 million) in exchange for an equivalent number of shares of member interest in IBG LLC.

On July 26, 2023, the Company filed a Prospectus Supplement on Form 424B (File Number 333-273451) with the SEC to re-register up to 2,520,000 shares of common stock, offering the opportunity for eligible persons to receive awards in the form of an offer to receive such shares by participating in one or more promotions that are designed to attract new customers to the Company’s brokerage platform, increase assets held with the Company’s brokerage business and enhance customer loyalty. The Company has authorized a total of

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

4,000,000 shares of common stock to be issued under these promotions. From 2019 through the quarter ended June 30, 2025, the Company issued 2,880,000 shares to IBG LLC for distribution to eligible customers of certain of its subsidiaries.

As a consequence of redemption transactions in accordance with the Exchange Agreement, distribution of shares to customers under one or more promotions, and distribution of shares to employees (see Note 10), IBG, Inc.’s interest in IBG LLC has increased to approximately 26.0%, with Holdings owning the remaining 74.0% as of June 30, 2025. The redemptions also increased the Holdings interest held by Mr. Thomas Peterffy and his affiliates from approximately 84.6% at the IPO to approximately 91.4% as of June 30, 2025.

Earnings per Share

Basic earnings per share is calculated utilizing net income available for common stockholders divided by the weighted average number of shares of Class A and Class B common stock outstanding for that period.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions, except share or per share amounts)
Basic earnings per share
Net income available for common stockholders$224$179$437$354
Weighted average shares of common stock outstanding
Class A438,457,463430,875,680437,082,930429,579,300
Class B400400400400
438,457,863430,876,080437,083,330429,579,700
Basic earnings per share$0.51$0.42$1.00$0.82

Diluted earnings per share are calculated utilizing the Company’s basic net income available for common stockholders divided by diluted weighted average shares outstanding with no adjustments to net income available to common stockholders for potentially dilutive common shares.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions, except share or per share amounts)
Diluted earnings per share
Net income available for common stockholders$224$179$437$354
Weighted average shares of common stock outstanding
Class A
Issued and outstanding438,457,463430,875,680437,082,930429,579,300
Potentially dilutive common shares
Issuable pursuant to employee stock incentive plans2,982,0613,631,2643,375,7513,972,852
Class B400400400400
441,439,924434,507,344440,459,081433,552,552
Diluted earnings per share$0.51$0.41$0.99$0.82

Member Distributions and Stockholder Dividends

In April 2025 the Company increased its quarterly dividend from $0.0625 per share to $0.08 per share of common stock, on a post-split basis. During the six months ended June 30, 2025, IBG LLC made distributions totaling $653 million, to its members, of which IBG, Inc.’s proportionate share was $169 million. In March 2025, the Company paid quarterly cash dividends of $0.0625 per share of common stock, on a post-split basis, totaling $27 million. In June 2025, the Company paid quarterly cash quarterly cash dividends of $0.08 per share of common stock, on a post stock-split basis, totaling $35 million.

On July 17, 2025, the Company declared a quarterly cash dividend of $0.08 per share of common stock, payable on September 12, 2025 to stockholders of record as of September 1, 2025.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

5. Comprehensive Income

The table below presents comprehensive income and earnings per share on comprehensive income for the periods indicated.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions, except share or per share amounts)
Comprehensive income available for common stockholders$303$177$544$326
Earnings per share on comprehensive income
Basic$0.69$0.41$1.24$0.76
Diluted$0.69$0.41$1.23$0.75
Weighted average common shares outstanding
Basic438,457,863430,876,080437,083,330429,579,700
Diluted441,439,924434,507,344440,459,081433,552,552

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

6. Financial Assets and Financial Liabilities

Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

The tables below present, by level within the fair value hierarchy (see Note 2), financial assets and liabilities, measured at fair value on a recurring basis for the periods indicated. As required by ASC Topic 820, financial assets and financial liabilities are classified in their entirety based on the lowest level of input that is significant to the respective fair value measurement.

Financial Assets at Fair Value as of June 30, 2025
Level 1Level 2Level 3Total
(in millions)
Securities segregated for regulatory purposes
U.S. and foreign government securities$5,956$—$—$5,956
Municipal securities—64—64
Total securities segregated for regulatory purposes5,95664—6,020
Financial instruments owned, at fair value
Stocks2,990——2,990
Options3124—55
U.S. and foreign government securities644——644
Mutual funds————
Precious metals—33—33
Currency forward contracts—134—134
Total financial instruments owned, at fair value3,665191—3,856
Other assets
Customer-held fractional shares334——334
Other investments in equity securities48——48
Total other assets382——382
Total financial assets at fair value$10,003$255$—$10,258
Financial Liabilities at Fair Value as of June 30, 2025
Level 1Level 2Level 3Total
(in millions)
Financial instruments sold, but not yet purchased, at fair value
Stocks$132$—$—$132
Options18314—332
Precious metals—29—29
Currency forward contracts—1—1
Total financial instruments sold, but not yet purchased, at fair value150344—494
Accounts payable, accrued expenses and other liabilities
Fractional shares repurchase obligation334——334
Total accounts payable, accrued expenses and other liabilities334——334
Total financial liabilities at fair value$484$344$—$828

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Financial Assets at Fair Value as of December 31, 2024
Level 1Level 2Level 3Total
(in millions)
Securities segregated for regulatory purposes
U.S. and foreign government securities$6,460$—$—$6,460
Municipal securities—33—33
Total securities segregated for regulatory purposes6,46033—6,493
Financial instruments owned, at fair value
Stocks1,763——1,763
Options84——84
U.S. and foreign government securities54——54
Mutual funds2——2
Precious metals—21—21
Currency forward contracts————
Total financial instruments owned, at fair value1,90321—1,924
Other assets
Customer-held fractional shares260——260
Other investments in equity securities32——32
Total other assets292——292
Total financial assets at fair value$8,655$54$—$8,709
Financial Liabilities at Fair Value as of December 31, 2024
Level 1Level 2Level 3Total
(in millions)
Financial instruments sold, but not yet purchased, at fair value
Stocks$116$—$—$116
Options96——96
Precious metals—18—18
Currency forward contracts—63—63
Total financial instruments sold, but not yet purchased, at fair value21281—293
Accounts payable, accrued expenses and other liabilities
Fractional shares repurchase obligation260——260
Total accounts payable, accrued expenses and other liabilities260——260
Total financial liabilities at fair value$472$81$—$553

Level 3 Financial Assets and Financial Liabilities

There were no transfers in or out of level 3 for the six months ended June 30, 2025.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Financial Assets and Liabilities Not Measured at Fair Value

Financial assets and liabilities not measured at fair value are recorded at carrying value, which approximates fair value due to their short-term nature. The tables below represent the carrying value, fair value and fair value hierarchy category of certain financial assets and liabilities that are not recorded at fair value in the Company's condensed consolidated statements of financial condition for the periods indicated. The tables below exclude certain financial instruments such as equity method investments and all non-financial assets and liabilities.

June 30, 2025
Carrying‎ValueFair‎ValueLevel 1Level 2Level 3
(in millions)
Financial assets, not measured at fair value
Cash and cash equivalents$4,688$4,688$4,688$—$—
Cash - segregated for regulatory purposes45,05745,05745,057——
Securities - segregated for regulatory purposes30,95230,952—30,952—
Securities borrowed10,14510,145—10,145—
Securities purchased under agreements to resell9,5299,529—9,529—
Receivables from customers65,34665,346—65,346—
Receivables from brokers, dealers and clearing organizations4,0744,074—4,074—
Interest receivable454454—454—
Other assets4044—539
Total financial assets, not measured at fair value$170,285$170,289$49,745$120,505$39
Financial liabilities, not measured at fair value
Short-term borrowings$8$8$—$8$—
Securities loaned21,22921,229—21,229—
Payables to customers138,417138,417—138,417—
Payables to brokers, dealers and clearing organizations1,6821,682—1,682—
Interest payable283283—283—
Total financial liabilities, not measured at fair value$161,619$161,619$—$161,619$—

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

December 31, 2024
Carrying‎ValueFair‎ValueLevel 1Level 2Level 3
(in millions)
Financial assets, not measured at fair value
Cash and cash equivalents$3,633$3,633$3,633$—$—
Cash - segregated for regulatory purposes36,60036,60036,600——
Securities - segregated for regulatory purposes21,35321,353—21,353—
Securities borrowed5,3695,369—5,369—
Securities purchased under agreements to resell6,5756,575—6,575—
Receivables from customers64,43264,432—64,432—
Receivables from brokers, dealers and clearing organizations2,1962,196—2,196—
Interest receivable446446—446—
Other assets3032—329
Total financial assets, not measured at fair value$140,634$140,636$40,233$100,374$29
Financial liabilities, not measured at fair value
Short-term borrowings$14$14$—$14$—
Securities loaned16,24816,248—16,248—
Payables to customers115,343115,343—115,343—
Payables to brokers, dealers and clearing organizations476476—476—
Interest payable311311—311—
Total financial liabilities, not measured at fair value$132,392$132,392$—$132,392$—

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Netting of Financial Assets and Financial Liabilities

The Company’s policy is to net securities borrowed and securities loaned, and securities purchased under agreements to resell and securities sold under agreements to repurchase that meet the offsetting requirements prescribed in ASC Topic 210-20. In the tables below, the amounts of financial instruments that are not offset in the condensed consolidated statements of financial condition, but could be netted against cash or financial instruments with specific counterparties under master netting agreements, according to the terms of the agreements, including clearing houses (exchange-traded options, warrants and discount certificates) or over the counter currency forward contract counterparties, are presented to provide financial statement readers with the Company’s net payable or receivable with counterparties for these financial instruments.

The tables below present the netting of financial assets and financial liabilities for the periods indicated.

June 30, 2025
AmountsNet AmountsAmounts Not Offset
GrossOffset in thePresented inin the Condensed
AmountsCondensedthe CondensedConsolidated
of FinancialConsolidatedConsolidatedStatements of
Assets andStatements ofStatements ofFinancial Condition
LiabilitiesFinancialFinancialCash or FinancialNet
RecognizedCondition 2ConditionInstrumentsAmount
(in millions)
Offsetting of financial assets
Securities segregated for regulatory purposes:
Segregated securities purchased under agreements to resell$28,2491$—$28,249$(28,249)$—
Segregated securities borrowed2,7031—2,703(2,625)78
Securities borrowed10,145—10,145(9,881)264
Securities purchased under agreements to resell9,529—9,529(9,529)—
Financial instruments owned, at fair value
Options55—55(42)13
Currency forward contracts134—134—134
Total$50,815$—$50,815$(50,326)$489
(in millions)
Offsetting of financial liabilities
Securities loaned$21,229$—$21,229$(19,966)$1,263
Financial instruments sold, but not yet purchased, at fair value
Options332—332(42)290
Currency forward contracts1—1—1
Total$21,562$—$21,562$(20,008)$1,554

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

December 31, 2024
AmountsNet AmountsAmounts Not Offset
GrossOffset in thePresented inin the Condensed
AmountsCondensedthe CondensedConsolidated
of FinancialConsolidatedConsolidatedStatements of
Assets andStatements ofStatements ofFinancial Condition
LiabilitiesFinancialFinancialCash or FinancialNet
RecognizedCondition 2ConditionInstrumentsAmount
(in millions)
Offsetting of financial assets
Securities segregated for regulatory purposes:
Segregated securities purchased under agreements to resell$21,3531$—$21,353$(21,353)$—
Segregated securities borrowed—————
Securities borrowed5,369—5,369(5,159)210
Securities purchased under agreements to resell6,575—6,575(6,575)—
Financial instruments owned, at fair value
Options84—84(69)15
Currency forward contracts—————
Total$33,381$—$33,381$(33,156)$225
(in millions)
Offsetting of financial liabilities
Securities loaned$16,248$—$16,248$(15,105)$1,143
Financial instruments sold, but not yet purchased, at fair value
Options96—96(69)27
Currency forward contracts63—63—63
Total$16,407$—$16,407$(15,174)$1,233

1.As of June 30, 2025 and December 31, 2024, the Company had $28.2 billion and $21.4 billion, respectively, of securities purchased under agreements to resell, and $2.7 billion and $0, respectively, of securities borrowed that were segregated to satisfy regulatory requirements. These securities are included in “Securities - segregated for regulatory purposes” in the condensed consolidated statements of financial condition.

2.The Company did not have any balances eligible for netting in accordance with ASC Topic 210-20 as of June 30, 2025 and December 31, 2024.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Secured Financing Transactions – Maturities and Collateral Pledged

The tables below present gross obligations for securities loaned transactions by remaining contractual maturity and class of collateral pledged for the periods indicated.

June 30, 2025
Remaining Contractual Maturity
OvernightLess than30 – 90Over 90
and Open30 daysdaysdaysTotal
(in millions)
Securities loaned
Stocks$21,135$—$—$—$21,135
Corporate bonds86———86
Foreign government securities8———8
Total securities loaned$21,229$—$—$—$21,229
December 31, 2024
Remaining Contractual Maturity
OvernightLess than30 – 90Over 90
and Open30 daysdaysdaysTotal
(in millions)
Securities loaned
Stocks$16,215$—$—$—$16,215
Corporate bonds33———33
Total securities loaned$16,248$—$—$—$16,248

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

7. Collateralized Transactions

The Company enters into securities borrowing and lending transactions and agreements to repurchase and resell securities to finance trading inventory, to obtain securities for settlement and to earn residual interest rate spreads. In addition, the Company’s customers pledge their securities owned to collateralize margin loans. Under these transactions, the Company either receives or provides collateral, including equity, corporate debt and U.S. government securities. Under typical agreements, the Company is permitted to sell or repledge securities received as collateral and use these securities to secure securities purchased under agreements to resell, enter into securities lending transactions or deliver these securities to counterparties to cover short positions.

The Company also engages in securities financing transactions with and for customers through margin lending. Customer receivables generated from margin lending activity are collateralized by customer-owned securities held by the Company. Customers’ required margin levels and established credit limits are monitored continuously by risk management staff using automated systems. Pursuant to the Company’s policy and as enforced by such systems, customers are required to deposit additional collateral or reduce positions, when necessary, to avoid automatic liquidation of their positions.

Margin loans are extended to customers on a demand basis and are not committed facilities. Factors considered in the acceptance or rejection of margin loans are the amount of the loan, the degree of leverage being employed in the customer account and an overall evaluation of the customer’s portfolio to ensure proper diversification or, in the case of concentrated positions, appropriate liquidity of the underlying collateral. Additionally, transactions relating to concentrated or restricted positions are limited or prohibited by raising the level of required margin collateral (to 100% in the extreme case). The underlying collateral for margin loans is evaluated with respect to the liquidity of the collateral positions, valuation of securities, volatility analysis and an evaluation of industry concentrations. Adherence to the Company’s collateral policies significantly limits the Company’s credit exposure to margin loans in the event of a customer’s default. Under margin lending agreements, the Company may request additional margin collateral from customers and may sell securities that have not been paid for or purchase securities sold but not delivered from customers, if necessary. As of June 30, 2025 and December 31, 2024, $65.3 billion and $64.4 billion, respectively, of customer margin loans were outstanding.

The table below presents a summary of the amounts related to collateralized transactions for the periods indicated.

June 30, 2025December 31, 2024
PermittedSold orPermittedSold or
to RepledgeRepledgedto RepledgeRepledged
(in millions)
Securities lending transactions$165,479$17,713$134,407$8,342
Securities purchased under agreements to resell transactions 137,73635,94527,98826,678
Customer margin assets87,74326,18387,80921,465
$290,958$79,841$250,204$56,485

1.As of June 30, 2025 and December 31, 2024, the Company had $28.2 billion and $21.4 billion, respectively, of securities purchased under agreements to resell, and $2.7 billion and $0, respectively, of securities borrowed that were segregated to satisfy regulatory requirements. These securities are included in “Securities - segregated for regulatory purposes” in the condensed consolidated statements of financial condition.

In the normal course of business, the Company pledges qualified securities with clearing organizations to satisfy daily margin and clearing fund requirements. As of June 30, 2025 and December 31, 2024, the majority of the Company’s U.S. and foreign government securities owned were pledged to clearing organizations.

The table below presents financial instruments owned and pledged as collateral, including amounts pledged to affiliates, where the counterparty has the right to repledge, for the periods indicated.

June 30,December 31,
20252024
(in millions)
Stocks$32$25
U.S. and foreign government securities4752
$79$77

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

8. Revenues from Contracts with Customers

Revenue from contracts with customers is recognized when, or as, the Company satisfies its performance obligations by transferring the promised services to the customers. A service is transferred to a customer when, or as, the customer obtains control of that service. A performance obligation may be satisfied at a point in time or over time. Revenue from a performance obligation satisfied at a point in time is recognized at the point in time that the Company determines the customer obtains control over the promised service. Revenue from a performance obligation satisfied over time is recognized by measuring the Company’s progress in satisfying the performance obligation in a manner that depicts the transfer of the services to the customer. The amount of revenue recognized reflects the consideration the Company expects to receive in exchange for those promised services (i.e., the “transaction price”). In determining the transaction price, the Company considers multiple factors, including the effects of variable consideration, if any.

The Company’s revenues from contracts with customers are recognized when the performance obligations are satisfied at an amount that reflects the consideration expected to be received in exchange for such services. The majority of the Company’s performance obligations are satisfied at a point in time and are typically collected from customers by debiting their brokerage account with the Company.

Nature of Services

The Company’s main sources of revenues from contracts with customers are as follows:

Commissions are charged to customers for order execution services and trade clearing and settlement services. These services represent a single performance obligation as the services are not separately identifiable in the context of the contract. The Company recognizes revenue at a point in time at the execution of the order (i.e., trade date). Commissions are generally collected from cleared customers on trade date and from non-cleared customers monthly. Commissions also include payments for order flow received from IBKR LiteSM liquidity providers.

Market data fees are charged to customers for market data services to which they subscribe that the Company delivers. The Company recognizes revenue monthly as the performance obligation is satisfied over time by continually providing market data for the period. Market data fees are collected monthly, generally in advance.

Risk exposure fees are charged to customers who carry positions with a market risk that exceeds defined thresholds. The Company recognizes revenue daily as the performance obligation is satisfied at a point in time by the Company taking on the additional risk of account liquidation and potential losses due to insufficient margin. Risk exposure fees are collected daily.

Payments for order flow are earned from various options exchanges based upon options trading volume originated by the Company that meets certain criteria. The Company recognizes revenue daily as the performance obligation is satisfied at a point in time on customer orders that qualify for payments subject to exchange-mandated programs. Payments for order flow are collected monthly, in arrears.

FDIC sweep fees are earned from the banks that participate in the Company’s Insured Bank Deposit Sweep Program with respect to the Company’s customers’ funds deposited with each participating bank. The Company recognizes revenue daily as the performance obligation is satisfied when customer funds are swept to their FDIC insured accounts with the participating banks.

The Company also earns revenues from other services, including minimum activity fees, order cancelation or modification fees, position transfer fees, telecommunications fees, and withdrawal fees, among others.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

Disaggregation of Revenue

The tables below present revenue from contracts with customers by geographic location and major types of services for the periods indicated.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions)
Geographic location 1
United States$351$296$713$568
International227178457344
$578$474$1,170$912
Major types of services
Commissions$516$406$1,030$785
Market data fees 220183935
Risk exposure fees 217244543
Payments for order flow 29102220
FDIC sweep fees 2971713
Other 2791716
$578$474$1,170$912

1.Based on the location of the subsidiaries in which the revenues are recorded.

2.Included in “Other fees and services” in the condensed consolidated statements of comprehensive income.

Receivables and Contract Balances

Receivables arise when the Company has an unconditional right to receive payment under a contract with a customer and are derecognized when the cash is received. Receivables of $30 million and $31 million, as of June 30, 2025 and December 31, 2024, respectively, are reported in “Other assets” in the condensed consolidated statements of financial condition.

Contract assets arise when the revenue associated with the contract is recognized before the Company’s unconditional right to receive payment under a contract with a customer (i.e., unbilled receivable) and are derecognized when either it becomes a receivable or the cash is received. Contract assets are reported in “Other assets” in the condensed consolidated statements of financial condition. As of June 30, 2025 and December 31, 2024, there were no contract asset balances outstanding.

Contract liabilities arise when customers remit contractual cash payments in advance of the Company satisfying its performance obligations under the contract and are derecognized when the revenue associated with the contract is recognized either when a milestone is met triggering the contractual right to bill the customer or when the performance obligation is satisfied. Contract liabilities are reported in “Accounts payable, accrued expenses and other liabilities” in the condensed consolidated statements of financial condition. As of June 30, 2025 and December 31, 2024, there were no contract liability balances outstanding.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

9. Other Income

The table below presents the components of other income for the periods indicated.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions)
Principal transactions 1$44$28$85$41
Gains (losses) from currency diversification strategy, net(5)(20)15(22)
Other, net3(44)7(37)
$42$(36)$107$(18)

1.Principal transactions include (1) trading gains and losses from the Company’s remaining market making activities; (2) realized and unrealized gains and losses on financial instruments that (a) are held for purposes other than the Company’s market making activities, or (b) are subject to restrictions; and (3) dividends on investments accounted at cost less impairment.

10. Employee Incentive Plans

Defined Contribution Plan

The Company offers substantially all employees of U.S.-based operating subsidiaries who have met minimum service requirements the opportunity to participate in defined contribution retirement plans qualifying under the provisions of Section 401(k) of the Internal Revenue Code. The general purpose of this plan is to provide employees with an incentive to make regular savings in order to provide additional financial security during retirement. This plan provides for the Company to match 50% of the employees’ pre-tax contribution, up to a maximum of 10% of eligible earnings. The employee is vested in the matching contribution incrementally over six years of service. Included in “Employee compensation and benefits” expense in the condensed consolidated statements of comprehensive income was $4 million of plan contributions for each of the six months ended June 30, 2025 and 2024.

2007 Stock Incentive Plan

Under the Company’s Stock Incentive Plan, up to 160 million shares of the Company’s Class A common stock may be issued to satisfy vested restricted stock units granted to directors, officers, employees, contractors and consultants of the Company. The purpose of the Stock Incentive Plan is to promote the Company’s long-term financial success by attracting, retaining and rewarding eligible participants.

As a result of the Company’s organizational structure, a description of which can be found in “Business – Our Organizational Structure” in Part I, Item 1 of the Company’s 2024 Annual Report on Form 10-K, filed with the SEC on February 27, 2025, there is no material dilutive effect upon ownership of common stockholders of issuing shares under the Stock Incentive Plan. The issuances do not dilute the book value of the ownership of common stockholders since the restricted stock units are granted at market value, and upon their vesting and the related issuance of shares of common stock, the ownership of IBG, Inc. in IBG LLC, increases proportionately to the shares issued. As a result of such proportionate increase in share ownership, the dilution upon issuance of common stock is borne by IBG LLC’s majority member (i.e., noncontrolling interest), Holdings, and not by IBG, Inc. or its common stockholders. Additionally, dilution of earnings that may take place after issuance of common stock is reflected in EPS reported in the Company’s financial statements. The EPS dilution can be neither estimated nor projected, but historically it has not been material.

The Stock Incentive Plan is administered by the Compensation Committee of the Company’s Board of Directors. The Compensation Committee has discretionary authority to determine the eligibility to participate in the Stock Incentive Plan and establishes the terms and conditions of the awards, including the number of awards granted to each participant and all other terms and conditions applicable to such awards in individual grant agreements. Awards are expected to be made primarily through grants of restricted stock units. Stock Incentive Plan awards are subject to issuance over time. All previously granted but not yet earned awards may be canceled by the Company upon the participant’s termination of employment or violation of certain applicable covenants before issuance, unless determined otherwise by the Compensation Committee.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

The Stock Incentive Plan provides that, upon a change in control, the Compensation Committee may, at its discretion, fully vest any granted but not yet earned awards under the Stock Incentive Plan, or provide that any such granted but not yet earned awards will be honored or assumed, or new rights substituted by the new employer on a substantially similar basis and terms and conditions substantially comparable to those of the Stock Incentive Plan.

The Company expects to continue to grant awards on or about December 31 of each year to eligible participants as part of an overall plan of equity compensation. In 2021, the Company’s Compensation Committee approved a change to the vesting schedule for the Stock Incentive Plan. For awards granted on December 31, 2021 onwards, restricted stock units vest and become distributable to participants 20% on each vesting date, which is on or about May 9 of each year, assuming continued employment with the Company and compliance with non-competition and other applicable covenants. The vesting and distribution of grants prior to December 31, 2021 remain in accordance with the following schedule: (a) 10% on the first vesting date, which is on or about May 9 of each year; and (b) an additional 15% on each of the following six anniversaries of the first vesting.

Awards granted to directors vest and are distributed as follows: (a) one-time award granted to external directors on December 31 of the year of appointment vests over a five-year period (20% per year) commencing one year after the date of grant, and (b) annual awards granted to all directors on December 31 of each year are fully vested and distributed immediately on grant date. A total of 162,344 restricted stock units have been granted to the directors cumulatively since the plan’s inception.

The table below presents Stock Incentive Plan awards granted and the related fair values since the plan’s inception.

Fair Value at
Date of Grant
Units($ millions)
Prior periods (since inception)117,328,236$842
April 25, 2022723,556112
December 31, 20224,992,42091
December 31, 20235,031,288102
December 31, 20242,481,2842112
Total awards granted since inception130,556,784$1,159

1.April 25, 2022, the Company awarded a special grant of restricted stock units to employees.

2.Stock Incentive Plan number of granted restricted stock units related to 2024 was adjusted by 12,796 additional restricted stock units during the six months ended June 30, 2025.

Estimated future grants under the Stock Incentive Plan are accrued for ratably during each year (see Note 2). In accordance with the vesting schedule, outstanding awards vest and are distributed to participants yearly on or about May 9 of each year. At the end of each year, no vested awards remain undistributed.

Compensation expense related to the Stock Incentive Plan recognized in the condensed consolidated statements of comprehensive income was $59 million and $54 million for the six months ended June 30, 2025 and 2024, respectively. Estimated future compensation costs for unvested awards, net of credits for canceled awards, as of June 30, 2025 are $28 million.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

The table below summarizes the Stock Incentive Plan activity for the periods indicated.

Stock
Incentive Plan
Units
Balance, December 31, 2024 115,332,675
Granted—
Canceled(66,651)
Distributed(5,443,128)
Balance, June 30, 20259,822,896

1.Stock Incentive Plan number of granted restricted stock units related to 2024 was adjusted by 12,796 additional restricted stock units during the six months ended June 30, 2025.

Awards previously granted but not yet earned under the stock plans are subject to the plans’ post-employment provisions in the event a participant ceases employment with the Company. Since inception through June 30, 2025, a total of 5,979,912 restricted stock units have been distributed under these post-employment provisions. These distributions are included in the table above.

11. Income Taxes

Income tax expense for the six months ended June 30, 2025 and 2024 differs from the U.S. federal statutory rate primarily due to the tax treatment of income attributable to noncontrolling interests in IBG LLC. These noncontrolling interests are held directly through a U.S. partnership. Accordingly, the income attributable to these noncontrolling interests is reported in the condensed consolidated statements of comprehensive income, but the related U.S. income tax expense attributable to these noncontrolling interests is not reported by the Company as it is generally the obligation of the noncontrolling interests. Income tax expense is also affected by the differing effective tax rates in foreign, state and local jurisdictions where certain of the Company’s subsidiaries are subject to corporate taxation.

Deferred income taxes arise primarily due to the amortization of the deferred tax assets recognized in connection with the common stock offerings (see Note 4), differences in the valuation of financial assets and liabilities, and for other temporary differences arising from the deductibility of compensation and depreciation expenses in different periods for accounting and income tax return purposes.

As of and for the six months ended June 30, 2025 and 2024, the Company had no material valuation allowances on deferred tax assets.

The Company is subject to taxation in the U.S. and various states and foreign jurisdictions. As of June 30, 2025, the Company is no longer subject to U.S. Federal and State income tax examinations for tax years before 2016, and, except for India, is no longer subject to non-U.S. income tax examinations for tax years before 2011.

On July 4, 2025, H.R. 1, commonly referred to as the “One Big Beautiful Bill Act” (“OBBBA”), was signed into law. The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act of 2017, including 100% bonus depreciation and domestic research cost expensing. Additionally, OBBBA modifies the rules for Global Intangible Low Taxed Income (“GILTI”), renamed as Net CFC Tested Income (“NCTI”) under the OBBBA. ASC Topic 740 requires the effects of changes in tax rates and laws on deferred tax balances be recognized in the period in which the legislation is enacted. The Company is evaluating the impact of the OBBBA, and the results of such evaluations will be reflected on the Company’s Form 10-K for the year ending December 31, 2025.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

12. Leases

All of the Company’s leases are classified as operating leases and primarily consist of real estate leases for corporate offices, data centers and other facilities. As of June 30, 2025, the weighted-average remaining lease term on these leases is approximately 5.3 years and the weighted-average discount rate used to measure the lease liabilities is approximately 3.96%. For the six months ended June 30, 2025, right-of-use assets obtained under new operating leases were $15 million. The Company’s lease agreements do not contain any residual value guarantees, restrictions, or covenants.

The table below presents balances reported in the condensed consolidated statements of financial condition related to the Company’s leases for the periods indicated.

June 30,December 31,
20252024
(in millions)
Right-of-use assets 1$107$102
Lease liabilities 1$123$121

1.Right-of-use assets are included in “Other assets” and lease liabilities are included in “Accounts payable, accrued expenses and other liabilities” in the Company’s condensed consolidated statements of financial condition.

The table below presents balances reported in the condensed consolidated statements of comprehensive income related to the Company’s leases for the periods indicated.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions)
Operating lease cost$9$8$18$17
Variable lease cost3143
Total lease cost$12$9$22$20

The table below reconciles the undiscounted cash flows of the Company’s leases to the present value of its operating lease payments for the period indicated.

June 30, 2025
(in millions)
2025 (remaining)$17
202632
202724
202819
202918
203013
Thereafter12
Total undiscounted operating lease payments135
Less: imputed interest(12)
Present value of operating lease liabilities$123

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

13. Commitments, Contingencies and Guarantees

Legal, Regulatory and Governmental Matters

The Company is subject to certain pending and threatened legal, regulatory and governmental actions and proceedings that arise out of the normal course of business. Given the inherent difficulty of predicting the outcome of such matters, particularly in proceedings where claimants seek substantial or indeterminate damages, or which are in their early stages, the Company is generally not able to quantify the actual loss or range of loss related to such legal proceedings, the manner in which they will be resolved, the timing of their final resolution or the ultimate settlement. Management believes that the resolution of these matters will not have a material effect, if any, on the Company’s business or financial condition, but may have a material impact on the results of operations for a given period.

The Company accounts for potential losses related to litigation in accordance with FASB ASC Topic 450, “Contingencies.” As of June 30, 2025 and 2024, accruals for potential losses related to legal, regulatory and governmental actions and proceedings matters were not material.

Trading Technologies Matter

As previously disclosed, on February 3, 2010, Trading Technologies International, Inc. (“Trading Technologies”) filed a complaint in the U.S. District Court for the Northern District of Illinois, Eastern Division (the “District Court”), against IBG LLC and IB LLC (the “Defendants”). The complaint, as amended, alleged that the Defendants infringed twelve U.S. patents held by Trading Technologies, and sought damages and injunctive relief.

After proceedings before the United States Patent and Trademark Office Patent Trial Appeal Board, and review by the United States Court of Appeals for the Federal Circuit, all but four patents were found to be invalid. In June 2021, the District Court found two of the remaining four patents to be invalid, and trial on the two remaining patents began on August 6, 2021. On September 7, 2021, the jury rendered its verdict, finding that the Defendants infringed the two patents and awarding $6.6 million in damages to Trading Technologies, while rejecting Trading Technologies’ claims of willful infringement and request for damages of at least $962.4 million. On January 11, 2022, the District Court awarded Trading Technologies pre-judgment interest of $2.1 million and post-judgment interest, and on March 31, 2022, granted Trading Technologies’ bill of costs of $490,232.

On March 24, 2022, Harris Brumfield, the successor-in-interest to the patents-in-suit, filed a notice of appeal with the Court of Appeals of the Federal Circuit. After briefing on the appeal, oral argument was held on January 8, 2024. On March 27, 2024, the Federal Circuit affirmed the District Court’s judgment. On May 15, 2024, Harris Brumfield petitioned the Federal Circuit for a panel rehearing and rehearing en banc. On August 5, 2024, the Federal Circuit denied the petition and issued the mandate of the court on August 12, 2024. Harris Brumfield filed a petition for a writ of certiorari with the Supreme Court of the United States on January 2, 2025. On April 21, 2025, the Supreme Court denied Harris Brumfield’s petition for certiorari. On May 16, 2025, Harris Brumfield filed a petition for rehearing with the Supreme Court of the United States, which was denied by the Court on June 16, 2025. The judgment amount, including interest and costs, was paid by the Defendants to Harris Brumfield on June 18, 2025.

Class Action Matter

On December 18, 2015, a former individual customer filed a purported class action complaint against IB LLC, IBG, Inc., and Thomas Frank, Ph.D., the Company’s Executive Vice President and former Chief Information Officer, in the U.S. District Court for the District of Connecticut. The complaint alleged that a purported class of IB LLC’s customers were harmed by alleged “flaws” in the computerized system used to close out (i.e., liquidate) positions in customer brokerage accounts that have margin deficiencies. The complaint sought, among other things, undefined compensatory damages and declaratory and injunctive relief.

On September 28, 2016, the District Court issued an order granting the Company’s motion to dismiss the complaint in its entirety, without leave to amend. On September 28, 2017, the plaintiff appealed to the United States Court of Appeals for the Second Circuit. On September 26, 2018, the Court of Appeals affirmed the dismissal of plaintiff’s claims of breach of contract and commercially unreasonable liquidation but remanded plaintiff’s claims for negligence back to the District Court. The Company’s motion to dismiss plaintiff’s subsequent second amended complaint was denied on September 30, 2019. On July 14, 2022, after obtaining leave to amend his complaint, the plaintiff filed a third amended complaint. The Company’s answer and counterclaim were filed on July 26, 2022.

‎

Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

On August 25, 2023, the Court granted plaintiff’s motion for class certification, certifying a class that consists of IB LLC account holders who are U.S. residents (with some exclusions) who had positions liquidated from December 18, 2013 to the date of trial at prices outside of a “pricing corridor” defined in the Court’s decision. On September 8, 2023, the Company filed a petition for permission to appeal the District Court’s class certification decision to the United States Court of Appeals for the Second Circuit, which denied the Company’s petition on December 19, 2023. On July 11, 2025, the District Court granted the parties’ joint motion to amend the definition of the certified class so that it ends on July 14, 2025 (leaving all other aspects of the District Court’s initial class certification decision unchanged). The Company continues to believe that a purported class action is inappropriate given the great differences in portfolios, markets and many other circumstances surrounding the liquidation of any particular customer’s margin-deficient account. Pursuant to a District Court scheduling order, trial is tentatively scheduled to commence in 2026. IB LLC and the related defendants continue to believe that the claims are deficient and intend to continue to defend themselves vigorously.

Regulatory Matters

IB LLC identified a number of issues dating back to 2016 related to the Company’s compliance with sanctions regulations, predominantly concerning the facilitation of transactions in countries, or by entities, sanctioned by the Office of Foreign Assets Control (“OFAC”) of the United States Department of the Treasury. The Company made voluntary self-disclosures to OFAC, received additional inquiries from OFAC related to the Company’s sanctions compliance program, and cooperated with the investigation. On July 15, 2025, OFAC announced that IB LLC had agreed to pay OFAC $11,832,136 to settle the matter.

Guarantees

Certain of the operating subsidiaries provide guarantees to securities and commodities clearing houses and exchanges which meet the accounting definition of a guarantee under FASB ASC Topic 460, “Guarantees.” Under standard membership agreements, clearing house and exchange members are required to guarantee collectively the performance of other members. Under the agreements, if a member becomes unable to satisfy its obligations, other members would be required to meet shortfalls. In the opinion of management, the operating subsidiaries’ liability under these arrangements is not quantifiable and could exceed the cash and securities they have posted as collateral. However, the potential for these operating subsidiaries to be required to make payments under these arrangements is remote. Accordingly, no contingent liability is carried in the condensed consolidated statements of financial condition for these arrangements.

In connection with its retail brokerage business, IB LLC or other electronic brokerage operating subsidiaries perform securities and commodities execution, clearance and settlement on behalf of their customers for whom they commit to settle trades submitted by such customers with the respective clearing houses. If a customer fails to fulfill its settlement obligations, the respective operating subsidiary must fulfill those settlement obligations. No contingent liability is carried on the condensed consolidated statements of financial condition for such customer obligations.

Other Commitments

Certain clearing houses, clearing banks and firms used by certain operating subsidiaries are given a security interest in certain assets of those operating subsidiaries held by those clearing organizations. These assets may be applied to satisfy the obligations of those operating subsidiaries to the respective clearing organizations.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

14. Segment Reporting and Geographic Information

Segment Reporting

The Company has a single reportable segment, electronic brokerage, which is managed on a consolidated basis since the Company’s chief operating decision maker (“CODM”) assesses performance and allocates resources on a consolidated basis based on income before income taxes and net income as reported on the consolidated statements of comprehensive income. The Company’s CODM is its Chief Executive Officer and President.

The electronic brokerage segment provides execution, clearing and settlement of trades globally for hedge and mutual funds, ETFs, registered investment advisors, proprietary trading groups, introducing brokers and individual investors. The electronic brokerage segment derives revenue from customers in the U.S. and international markets by routing orders and executing and processing trades in stocks, options, futures, foreign exchange instruments (“forex”), bonds, mutual funds, ETFs, precious metals, and forecast contracts on more than 160 electronic exchanges and market centers in 37 countries and 28 currencies around the world, and by offering custody, prime brokerage, and securities and margin lending services to customers. In addition, electronic brokerage customers can use its trading platform to trade certain cryptocurrencies through third-party cryptocurrency service providers that execute, clear and custody the cryptocurrencies.

Since the electronic brokerage segment is managed on a consolidated basis, there are no reconciling items between segment and the consolidated amounts reported in these financial statements, including total assets and segment assets. The accounting policies of the electronic brokerage segment are the same as those described in the summary of significant accounting policies in Note 2.

The table below presents selected financial information, including significant expenses, for the Company’s single operating segment for the periods indicated.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions)
Total net revenues$1,480$1,230$2,907$2,433
Significant Expenses
Transaction based fees 19494196174
Non-transaction based fees 122204142
Employee compensation 2142132285266
Advertising 326184731
Other expenses 49286179174
Total non-interest expenses376350748687
Income before income taxes1,1048802,1591,746
Income tax expense9871189142
Net income$1,006$809$1,970$1,604
Total Segment Assets$181,475$136,648$181,475$136,648
Total Depreciation and Amortization 5$15$17$30$34

1.Included in “Execution, clearing and distribution fees” in the condensed consolidated statements of comprehensive income.

2.Included in “Employee compensation and benefits” in the condensed consolidated statements of comprehensive income.

3.Included in “General and administrative” in the condensed consolidated statements of comprehensive income.

4.Includes “Occupancy, depreciation and amortization”; “Communications”; “Customer bad debt”; employee benefits and other personnel expenses included in “Employee compensation and benefits”; and professional services, legal and regulatory matters, and other administrative expenses included in “General and administrative” in the condensed consolidated statements of comprehensive income.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

5.Included in “Occupancy, depreciation and amortization” in the condensed consolidated statements of comprehensive income.

Interest income and expense is disclosed in the condensed consolidated statements of comprehensive income.

Geographic Information

The Company operates its automated global business in the U.S. and international markets on more than 160 electronic exchanges and market centers. A significant portion of the Company’s net revenues is generated by subsidiaries operating outside the U.S. International operations are conducted in 36 countries in Europe, Asia/Pacific and the Americas (outside the U.S.). The following table presents total net revenues and income before income taxes by geographic area for the periods indicated.

Significant transactions and balances between the operating subsidiaries occur, primarily as a result of certain operating subsidiaries holding exchange or clearing organization memberships, which are utilized to provide execution and clearing services to subsidiaries. Intra-region income and expenses and related balances have been eliminated in this geographic information to reflect the external business conducted in each geographic region. The geographic analysis presented below is based on the location of the subsidiaries in which the transactions are recorded. This geographic information does not reflect the way the Company’s business is managed.

Three Months Ended June 30,Six Months Ended June 30,
2025202420252024
(in millions)
Net revenues
United States$1,006$836$1,997$1,664
International474394910769
Total net revenues$1,480$1,230$2,907$2,433
Income before income taxes
United States$830$656$1,636$1,303
International274224523443
Total income before income taxes$1,104$880$2,159$1,746

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

15. Regulatory Requirements

As of June 30, 2025, aggregate excess regulatory capital for all operating subsidiaries was $13.3 billion.

IB LLC, IBKRSS and IB Corp. are subject to the Uniform Net Capital Rule (Rule 15c3-1) under the Exchange Act. IB LLC is also subject to the CFTC’s minimum financial requirements (Regulation 1.17). IBC is subject to the Canadian Investment Regulatory Organization risk-adjusted capital requirement. IBKRFS is subject to the Swiss Financial Market Supervisory Authority eligible equity requirement, IBUK is subject to the United Kingdom Financial Conduct Authority Capital Requirements Directive, IBIE is subject to the Central Bank of Ireland financial resources requirement, IBI is subject to the National Stock Exchange of India net capital requirements, IBHK is subject to the Hong Kong Securities Futures Commission liquid capital requirement, IBSJ is subject to the Japanese Financial Supervisory Agency capital requirements, IBSG is subject to the Monetary Authority of Singapore capital requirements, and IBA is subject to the Australian Securities Exchange liquid capital requirement.

The table below summarizes capital, capital requirements and excess regulatory capital as of June 30, 2025.

Net Capital/
Eligible EquityRequirementExcess
(in millions)
IB LLC$9,739$1,308$8,431
IBHK1,5013971,104
IBIE1,7033361,367
Other regulated operating subsidiaries2,5701742,396
$15,513$2,215$13,298

Regulatory capital requirements could restrict the operating subsidiaries from expanding their business and declaring dividends if their net capital does not meet regulatory requirements. Also, certain operating subsidiaries are subject to other regulatory restrictions and requirements.

As of June 30, 2025, all regulated operating subsidiaries were in compliance with their respective regulatory capital requirements.

16. Related Party Transactions

Receivable from affiliate, reported in “Other assets” in the condensed consolidated statements of financial condition, represents amounts advanced to Holdings and payable to affiliate represents amounts payable to Holdings under the Tax Receivable Agreement (see Note 4).

The table below presents the receivables from and payables to directors, officers, and their affiliates which are included in receivables from and payables to customers, respectively, in the consolidated statements of financial condition for the periods indicated.

June 30,December 31,
20252024
(in millions)
Receivables from directors, officers and their affiliates$23$44
Payables to directors, officers, and their affiliates$1,293$1,320

The Company may extend credit to these related parties in connection with margin and securities loans. Such loans are (i) made in the ordinary course of business, (ii) are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable loans with persons not related to the company, and (iii) do not involve more than the normal risk of collectability or present other unfavorable features.

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Interactive Brokers Group, Inc. and Subsidiaries

Notes to Unaudited Condensed Consolidated Financial Statements

17. Subsequent Events

The Company has evaluated subsequent events for adjustment to or disclosure in its condensed consolidated financial statements through the date the condensed consolidated financial statements were issued.

Except as disclosed above and in Note 4 and Note 13, no other recordable or disclosable events occurred.

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