Slide 1: Second Quarter Investor Presentation
Second Quarter Investor Presentation September 2024 Interactive Brokers LLC Member NYSE - FINRA - SIPC
Slide 2: Disclaimer
Disclaimer Non-GAAP Financial Measures We use certain non-GAAP financial measures as additional measures to enhance the understanding of our financial results. This presentation includes the following non- GAAP financial measures: adjusted net revenues, adjusted variable expenses, adjusted fixed exp
Slide 3: Company Overview
Company Overview1 We Are a Highly Automated Electronic Broker We use our proprietary technology and international We offer a wide array of financial products on more than market-maker experience to offer the lowest cost,2 150 market centers in 34 countries and 27 currencies around the world. sea
Slide 4: Financial Strength – Strong and Growing
Financial Strength – Strong and Growing1 Consistent revenue growth Over 99% of our balance sheet is comprised of liquid assets Steady EPS growth from low cost / high margin model Solid Equity Capital and No long-term debt 1. “Interactive Brokers Group” and “IBKR” include the Group’s operating subsid
Slide 5: The IBKR Advantage
The IBKR Advantage Superior Technology Breadth of Global Products Award-winning platforms (desktop, mobile and web-based) that Clients can access 150 market centers in 34 countries match a client’s trading style and expertise—from powerful trading features for professional traders to streamlined
Slide 6: Impact of Automation
Impact of Automation Automation allows IBKR to be one of the lowest cost processors in the industry Majority of senior management are software engineers, committed to automating as many brokerage processes as possible From account opening through the entire transaction lifecycle, our processes a
Slide 7: FinTech vs Financial Services
FinTech vs Financial Services Financial Services FinTech IBKR Changes an existing IBKR boasts industry-leading margins that surpass both Technology assists A class of its own, financial services and financial technology companies business model in existing business combining the best finance in a
Slide 8: IBKR Growth Continues
IBKR Growth Continues1 Multiple factors, including increased interest in the More accounts on our platform have led to financial markets and the growing interconnectedness of more client assets held at IBKR. investors worldwide, have propelled account growth. 8 1. “Interactive Brokers Group” and “IB
Slide 9: IBKR Growth Continues
IBKR Growth Continues1 More accounts and client equity on our More accounts and higher activity This drives our superior, industry- highly automated platform mean higher levels translate to higher revenues. leading profit margins. activity, as seen in increased DART levels that remain above pre-pand
Slide 10: Interest Rate Sensitivity
Interest Rate Sensitivity Lower rates also reduce our interest Interest rate moves have a modest impact A growing balance sheet, supported expense. As we pay interest based on our net interest income. by healthy account growth may on benchmark rates, reduced rates offset this impact. are automatical
Slide 11: Diversified Client Base – by Client Type
Diversified Client Base – by Client Type1 As of June 30, 2024 Individuals Hedge and Mutual Funds Proprietary Trading Groups Financial Advisors Introducing Brokers 11 1. “Interactive Brokers Group” and “IBKR” include the Group’s operating subsidiaries
Slide 12: Diversified Client Base – by Geography
Diversified Client Base – by Geography1 As of June 30, 2024 Americas Europe Asia-Pacific 12 1. “Interactive Brokers Group” and “IBKR” include the Group’s operating subsidiaries
Slide 13: Superior Technology: BestX
Superior Technology: BestXTM IBKR BestXTM is a powerful suite of advanced trading technologies designed to help clients achieve best execution and maximize price improvement while minimizing market impact and maintaining complete control over their orders. For IBKR Pro clients, we do not sell custom
Slide 14: Professional Pricing
Professional Pricing Clients Benefit from Rising Interest Rates • Clients can earn up to 4.83%1 on instantly MARGIN RATES4,5 INTEREST BROKER available cash balances over $10,000, paid RATES $25K $300K $1.5M $3.5M directly to client brokerage accounts 1 Interactive Brokers 4.83% 6.83% 6.50% 6.28% 6
Slide 15: IBKR Desktop: The Next Big Thing in Trading
IBKR Desktop: The Next Big Thing in Trading Next Generation Trading Platform Powerful trading capabilities in a user-friendly interface for novice and experienced traders Simplified and streamlined design for faster and easier navigation Modern UI framework that combines aesthetics with speed
Slide 16: IBKR GlobalTrader
IBKR GlobalTrader1 A Streamlined Mobile App for Global Stock Trading Trade Stocks Worldwide Trade 90+ stock markets worldwide, plus options and cryptocurrencies2 Trade and fund in one of 27 different currencies Fractional Trading With fractional shares, clients can invest with as little as $1,
Slide 17: High-Touch Prime Brokerage Service
High-Touch Prime Brokerage Service1 Large, active hedge funds receive enhanced support, which includes: A dedicated Relationship Manager who acts as the primary point of contact Access to Subject Matter Experts in Risk/Margin, Compliance, Securities Finance, Corporate Actions, Clearing and Tax
Slide 18: Trade Forecast Contracts from ForecastEx
Trade Forecast Contracts from ForecastEx1,2 Trade a View on Economic Indicators and Global Climate Events Trade the probabilities associated with the future outcomes of US economic events and global events US Economic Events include Unemployment Claims, Consumer Price Index, Retail Sales, Fed Fu
Slide 19: Overnight Trading Hours
Overnight Trading Hours Trade US Stocks, ETFs1 and Treasury Bonds Around the Clock React immediately to market-moving news Conveniently trade at almost any time Clients globally can access US markets during their trading day Available for over 10,000 US stocks and ETFs, and US government tre
Slide 20: Securities Lending Dashboard
Securities Lending Dashboard Clients can now access the same expanded securities lending data and key metrics for US equities that previously were only available to banks, broker-dealers and large institutional investors. Use Short Sale Data to Gauge Short Sentiment New tool to help better inform
Slide 21: IBKR Campus
IBKR Campus1 We remain committed to having the most informed clients, wherever they are in their investing journey. IBKR Campus is designed to assist our clients in learning more about trading, the economy, and financial markets— from the most basic educational fundamentals to sophisticated strategi
Slide 22: Recent Enhancements and New Products
Recent Enhancements and New Products New Trading Venues1 • Eurex Exchange / Korea Exchange (KRX) KOSPI and USD/KRW Derivatives – Eurex Exchange has partnered with KRX to list KOSPI and USD/KRW derivatives at Eurex. These products are available during the core European and North American trading hour
Slide 23: Recent Enhancements and New Products
Recent Enhancements and New Products PortfolioAnalyst Retirement Planner1 • Enables clients to have a better understanding of their retirement outlook by creating a plan that considers their personal retirement preferences, current and future employment expectations, any potential additional monthly
Slide 24: Consistent Recognition as an Industry Leader
Consistent Recognition as an Industry Leader IBKR’s Multiple Trading 2024 ForexBrokers.com Awards Platforms, Extensive Suite 2023 Benzinga Awards 5 out of 5 stars Overall Rating Best Online Brokers for Bonds #1 Professional Trading of Advanced Trading Best Overall Broker for Mutual Funds #1 ESG Of
Slide 25: Consistent Recognition as an Industry Leader (continued)
Consistent Recognition as an Industry Leader (continued) 2024 Investopedia Awards 2023 Preqin Awards 2023 Broker Awards Best Broker for Advanced Traders Top Prime Broker Best Multi-Asset Broker Best for International Trading Top Hedge Fund Custodian Best for Risk Management Best for Generating Stock
Slide 26: Appendix
APPENDIX é InteractiveBrokers
Slide 27: Pioneer in technology throughout the years
Pioneer in technology throughout the years Over four decades of developing our automated trading platforms allow us to be the lowest cost broker-dealer Launched IBUSOPT to help clients Ushered a new achieve better era of Launched price execution Thomas computerized cryptocurrency for options. Peterf
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation Year Ended December 31, 2020 2021 2022 2023 (in millions) Adjusted net revenues Net revenues - GAAP $ 2,218 $ 2,714 $ 3,067 $ 4,340 Non-GAAP adjustments Year Ended December 31, Currency diversification strategy, net 19 37 100 80 2020 2021 2022 2023 Mark-to-market on investmen
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation Quarter Ended 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 (in millions) Adjusted net revenues Net revenues - GAAP $ 539 $ 548 $ 599 $ 893 $ 754 $ 464 $ 603 $ 645 $ 656 $ 790 $ 976 $ 1,056 $ 1,000 $ 1,145 $ 1,139 $ 1,203 $ 1,230 Non-GAA
Slide 30: UP-C Corporate Structure
UP-C Corporate Structure Members of IBG Public Stockholders Holdings LLC Interactive Brokers Group, Inc. (IBG, Inc.) is the public 100% economic interest company that trades on Nasdaq as IBKR. It approximately 25.7% voting interest owns 25.7% of the membership interests of IBG LLC Interactive Brok
Slide 31: Equity Capital
Equity Capital Solid Foundation for Growth and Resilience $15.2 B We use capital to: • Enter new countries Capture Growth Opportunities • Introduce new products • M&A • Customer credits can be used to fund the bulk of Support Margin Loans our margin loans, then financing and our own capital is requi