stockrowWhat it does
Interactive Brokers is an automated global brokerage. It gives individuals and institutions a way to hold accounts, access markets and trade financial instruments. Its services include routing orders to trading venues, executing trades, clearing and settling transactions, and holding customer assets. The business traces its roots to 1977 and is headquartered in Greenwich, Connecticut. Milan Galik is its chief executive officer.
Customers can use a single platform to trade stocks, options, futures, currencies, bonds, mutual funds, exchange-traded funds, precious metals and forecast contracts. Forecast contracts allow customers to trade on the outcome of a specified event. Interactive Brokers also provides access to certain cryptocurrencies, with third-party providers handling execution, clearing and custody for some offerings.
The company connects customers to electronic exchanges and market centers around the world in multiple currencies. Its platforms include desktop and mobile applications, a web portal and interfaces that customers can use to build their own trading applications. Customers can also borrow against eligible assets, lend shares and earn interest on qualifying cash balances.
Interactive Brokers serves individual investors alongside hedge funds, investment advisers, proprietary trading firms and other financial intermediaries. It also provides tools for advisers to allocate trades and rebalance client accounts. The public company is a holding company and the sole managing member of IBG LLC, which holds the operating businesses.
How it makes money
Interactive Brokers earns money primarily from interest and trading commissions. In 2025, commission revenue was $2.1 billion; in Q2 2026, net interest income rose year over year.
Interest income comes from activities including margin lending, investing customer cash held in segregated accounts and securities lending. Margin loans let customers borrow against assets in their accounts. The company pays interest on qualifying customer cash balances, so its net interest income reflects both what it earns and what it pays. In 2025, net interest income increased, supported by higher average customer margin loans and credit balances and stronger securities lending activity.
The company also charges commissions for executing customer trades. Commission revenue increased 26.6% in 2025, as stock, options and futures volumes rose. Pricing depends on the service and product: IBKR Pro offers access to multiple markets and products, while IBKR Lite offers participating U.S. customers commission-free trading in U.S. exchange-listed stocks and ETFs.
Other revenue includes market data fees, risk exposure fees, fees from sweeping eligible customer cash into bank deposits, and payments from exchange-mandated order-flow programs. Under its stock lending program, Interactive Brokers borrows eligible fully paid shares from customers, lends them onward and shares lending economics with customers.
Trading commissions depend on customer activity rather than a fixed subscription. Interest and lending income depend on customer balances, benchmark rates and demand to borrow securities; customers’ cash interest is an offsetting expense. In Q2 2026, higher balances helped drive net interest income growth, while interest paid on customer cash also increased.
| Product or service | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| Commissions | $2.1 billion | 88.1% | 26.6% |
| Risk Exposure Fees | $80.0 million | 3.28% | −20.0% |
| Market Data Fees | $79.0 million | 3.24% | 11.3% |
| Payments For Order Flow | $51.0 million | 2.09% | 13.3% |
| Others | $44.0 million | 1.80% | 22.2% |
| FDIC Sweep Fees | $37.0 million | 1.52% | 32.1% |
Customers and how it sells
Interactive Brokers serves individual investors and professional customers, including hedge funds, mutual funds, financial advisers, proprietary trading firms, introducing brokers and banks. It provides prime brokerage services such as financing and securities lending to hedge funds, while advisers can use its portfolio models, trade-allocation and rebalancing tools.
Most customers use both its execution and clearing services. Other customers, including trading firms that provide liquidity in its alternative trading system, use its execution services but clear trades through another prime broker or custodian bank. Customers reach the brokerage through desktop and mobile applications, a web portal and application programming interfaces; introducing brokers also bring customers to the platform.
The company services cleared customer accounts around the world. Its market connections span exchanges and market centers across multiple countries, while its offices include locations in North America, Europe, Asia and Australia.
Interactive Brokers began offering trading access to the Korea Exchange and Nextrade in Q2 2026. It also began offering cryptocurrencies throughout Europe.
| Region | Revenue, FY2025 | Share | Change on the year |
|---|---|---|---|
| United States | $1.5 billion | 60.7% | 20.5% |
| International | $958.0 million | 39.3% | 28.2% |
Suppliers and costs
Interactive Brokers relies on exchanges and other market centers to execute customer orders. It also uses outside providers for some cryptocurrency services: Paxos Trust Company and Zero Hash LLC execute, clear and custody cryptocurrencies for eligible customers of Interactive Brokers LLC. The business is a brokerage rather than a manufacturer.
Its costs include execution, clearing and distribution fees; compensation and benefits; market data; regulatory fees; and general and administrative expenses. The company also pays interest on qualifying customer cash balances. It develops proprietary software to automate brokerage, order routing and middle- and back-office functions.
In Q2 2026, execution, clearing and distribution costs rose from the year-ago quarter. The increase was driven primarily by the return of SEC regulatory fees. Those fees are largely passed through to customers, increasing both commission revenue and execution costs. The company also incurred compensation and benefits and general and administrative expenses during the quarter.
The company expects increasing compliance costs as its financial services businesses operate under U.S. and foreign regulation, as well as exchange and self-regulatory requirements.
- Revenue$6.2B
- Cost of revenue−$420.0M
- Selling, general and administrative−$1.0B
- Operating income$4.8B
Competitive position
Interactive Brokers competes with integrated banks, online brokers and new entrants in brokerage, prime brokerage and services for financial advisers and introducing brokers. Competition includes execution quality, customer experience, products, technology, global access, commissions and interest rates. The company also competes for qualified employees.
It was reported on 28 October 2026 that Robinhood and Webull rely on retail traders, while Interactive Brokers serves a more global base of active traders and institutions. It was reported on 16 October 2026 that Robinhood, eToro and Trade Republic already offered crypto staking when Interactive Brokers entered that service.
Interactive Brokers’ proprietary systems connect order routing, market data, securities lending and regulatory reporting. Its platforms give customers access to multiple products, markets and currencies, and its APIs allow customers to build and automate trading applications.
Our reading: The breadth of market access and the integration of brokerage functions provide a meaningful competitive advantage for customers who need several markets and services in one account. Our reading: Proprietary automation supports that advantage by enabling low-commission execution, although the company still faces competitors on price and service. Our reading: Its tools for advisers and other institutions add differentiation, but the evidence does not establish how difficult those customers would find it to switch.
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| Robinhood | Retail brokerage and cryptocurrency staking | Medium |
| Webull | Retail brokerage | Medium |
| eToro | Cryptocurrency staking | Low |
| Trade Republic | Cryptocurrency staking | Low |
Growth opportunities
Interactive Brokers is expanding through customer acquisition, additional market access and new services. Its automation strategy is intended to support more trading and accounts while limiting the need for manual processing. In 2025, customer equities, options, foreign exchange and futures volumes rose compared with the prior year.
In Q2 2026, new accounts grew 34.0% year over year. The company also increased access to Korean trading venues and launched a unified destination for event contracts across exchanges. Its prediction-market offering includes contracts on events that can affect customers’ portfolios; the company said it did not offer sports or entertainment contracts.
Interactive Brokers has expanded connections between customer accounts and AI tools. In Q2 2026, customers could use connected chatbots to access account information and submit trading instructions, but had to approve those instructions before they became executable orders. It was reported on 21 October 2026 that the company launched autonomous trading, allowing eligible clients to authorize connected AI to submit supported orders without approving each one individually. Eligibility and other limits apply.
The company has also sought a national trust bank charter. It received preliminary conditional approval for the charter, which would be required to directly custody assets for mutual fund and ETF customers.
- $2.7BFY2021
- $3.1BFY2022
- $4.3BFY2023
- $5.2BFY2024
- $6.2BFY2025
Structural risks
- Trading activity: Retail participation and transaction volumes fluctuate with investor sentiment and market conditions. Interactive Brokers says retail transaction volumes may not be sustainable or predictable. Changes in market-center structure could also affect the value of its order-routing software.
- Interest rates: Lower benchmark rates reduce interest earned on segregated cash and margin loans, although they also reduce interest expense. The company estimates that rate changes affect annual net interest income, with the impact depending on balances and currencies.
- Regulation and international operations: The brokerage is extensively regulated across its markets. New legislation or changes to existing rules could affect the business, and political, economic and foreign-policy changes create additional uncertainty for international operations.
- Technology and intellectual property: Demand for electronic brokerage services is subject to technological change, evolving standards and changing customer demands. The company may be unable to protect intellectual property or use intellectual property needed for its business.
- Customer and counterparty exposure: The company extends margin loans and lends securities. It calculates customer margin requirements throughout the trading day and attempts to liquidate positions when equity falls below required levels, but market movements can create excessive losses.
- Cryptocurrency providers: Interactive Brokers relies on third-party service providers to offer customers access to some cryptocurrency trading and custody services.
Leadership
As of December 31, 2025, the public company owned a minority interest in IBG LLC and was its sole managing member. The remaining interest was held by IBG Holdings LLC, owned directly and indirectly by founder and chairman Thomas Peterffy and his affiliates, management, employees and certain other members.
| Name | Role | Since | Total pay, FY2025 |
|---|---|---|---|
| Thomas Peterffy | — | $766,500.00 | |
| Earl H. Nemser | — | $3.6 million | |
| Milan Galik | — | $19.7 million | |
| Paul J. Brody | — | $6.9 million | |
| Thomas A. Frank | — | $2.0 million |
Bottom line
Our reading
Interactive Brokers is an automated brokerage whose economics rest on customer trading, cash and borrowing balances, and securities lending. Its global access and integrated tools help it serve both individuals and institutions, while its results remain exposed to trading activity and interest rates. The public company controls the operating holding company but owns only part of it, an important distinction when considering its corporate structure.