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Interactive Brokers Fundamental Analysis 2024 Q1 | Growing Trends of Sales, Operating Income and Equity

Interactive Brokers Fundamental Analysis 2024 Q1

Financial Statement Analysis of IBKR

Since we will put money into IBKR, why don’t we take a look at IBKR’s financial statement to see if they have a strong financial condition?

IBKR Quarterly Sales Over Time
IBKR Quarterly Sales Over Time

First, we look at IBKR’s quarterly sales. Its revenue mainly comes from interest income, which is the interest charged when customers trade with leverage. And the second largest source of revenue is commissions charged to customers who buy and sell securities. We can see in the graph that obviously the quarterly revenue has been trending up steadily since 2010. In the most recent quarter, the first quarter of 2024, its sales hit a record high of 1.2 billion US dollars, which is astounding.

One reason why Interactive Brokers can achieve such incredible performance is that its client counts surpassed 2.5 million users in 2023. And during the first quarter of 2024, Interactive Brokers acquired 184,000 new accounts, marking the second-highest figure since the meme stock surge in the first quarter of 2021. This quarterly addition is twice the number of accounts we acquired throughout the entirety of 2019. These new accounts brought in more cash, contributing to the growth of its client credit balances, which reached a record $104.9 billion US dollars. Additionally, our client equity surged by 36% to $466 billion, indicating that they are nearing the milestone of managing half a trillion dollars in client assets.

IBKR Quarterly Operating Income Over Time
IBKR Quarterly Operating Income Over Time

Second, we look at the quarterly operating income over time. It is the number of Interactive Brokers’ revenue minus all related operating costs including employee compensation and benefits, clearing fees, administrative expenses, etc. The operating income hit a record high of 0.8 billion US dollars in the first quarter of 2024, which is remarkable.

IBKR Quarterly Equity Over Time
IBKR Quarterly Equity Over Time

Third, we look at IB’s equity level at the end of each quarter. Their equity also hits an all-time high of 14.6 billion US dollars at the end of March this year. The company’s net worth keeps going up, as they earn more than they spend each quarter.

In conclusion, with Interactive Brokers’ exceptionally strong financial position, I feel very safe to put my money in this broker.

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