Interactive Brokers Group, Inc. (NASDAQ:IBKR) stock fell 3.70% (As on July 19, 11:17:40 AM UTC-4, Source: Google Finance) after the company posted lower than expected result for the second quarter of FY 23. The company reported income before income taxes was $652 million for the current quarter and $716 million as adjusted. Commission revenue was unchanged at $322 million. Customer trading volume was mixed across product types with options contracts volume up 9% while futures contracts and stock share volumes were down 3% and 28%, respectively. Net interest income increased 99% to $694 million on higher benchmark interest rates and customer credit balances
IBKR in the second quarter of FY 23 has reported the adjusted earnings per share of $1.32, missing the analysts’ estimates for the adjusted earnings per share of $1.40. The company had reported the adjusted revenue growth of 35.9 percent to $1 billion in the second quarter of FY 23, missing the analysts’ estimates for revenue of $1.06 billion.
Moreover, execution, clearing and distribution fees expenses increased 21% to $93 million driven by higher customer trading volume in options, the non-recurrence of a $3 million OCC rebate in the year-ago quarter, and a $1 million increase in market data fees, which are associated with market data revenue included in other fees and services. General and administrative expenses increased $43 million to $85 million. The increase is largely attributable to reserves related to the previously-disclosed regulatory investigations into the use of unapproved electronic messaging and record-keeping requirements. As has been publicly reported, the SEC and CFTC are conducting an industry-wide sweep that has resulted in substantial settlements with other financial services firms. The company has reported pretax profit margin was 65% for the current quarter and 67% as adjusted. For the year-ago quarter, reported pretax margin was 60% and 63% as adjusted. Total equity of $12.7 billion.
Furthermore, during the second quarter, Customer accounts increased 19% to 2.29 million. Customer equity increased 24% to $365.0 billion. Total DARTs decreased 14% to 1.87 million. Cleared DARTs decreased 13% to 1.67 million. Customer credits increased 7% to $98.9 billion. Customer margin loans decreased 2% to $41.9 billion
Additionally, the company has declared a quarterly cash dividend of $0.10 per share. This dividend is payable on September 14, 2023, to shareholders of record as of September 1, 2023