Interactive Brokers at Global Exchange: Embracing Innovation and Growth

On Thursday, 05 June 2025, Interactive Brokers (NASDAQ:IBKR) presented at the Global Exchange and Trading Conference, offering a strategic overview that highlighted both optimism and challenges. Chairman Thomas Peterffy expressed confidence in the US economy and stock market, while acknowledging competitive pressures and the need for technological advancement.

Key Takeaways

• Interactive Brokers anticipates continued growth in retail trading, supported by a bullish outlook on the US economy.
• The company reported significant year-over-year increases in customer accounts, account equity, commissions, and interest income.
• A focus on technological innovation, including 24-hour trading and the launch of ForecastX, positions IBKR against competitors like Robinhood and eToro.
• Peterffy emphasizes American exceptionalism as a foundation for economic growth and investment attraction.

Financial Results

Interactive Brokers reported robust financial performance over the past year, with:

• Customer accounts increasing by 32% year-over-year for the twelve months ending in May.
• Account equity growing by 29% year-over-year.
• Commissions rising by 32% year-over-year.
• Interest income expanding by 31% year-over-year.
• Overnight trading accounting for 2.2% of total volume in May.

Operational Updates

The company is actively pursuing growth initiatives, including:

• Focusing on 24-hour trading, which is crucial for markets in the Far, Middle, and Near East.
• Planning for overnight trading to constitute 25-30% of volume over the next twenty years.
• Launching ForecastX, an event-based futures platform to aid decision-making.
• Executing a stock split on June 18.

IBKR recognizes the competitive landscape, particularly the rise of Robinhood and eToro, but remains confident in its technological edge.

Future Outlook

Looking ahead, Interactive Brokers foresees:

• The retail trading boom continuing, with increased participation from international markets.
• The US market outperforming globally due to deglobalization and geopolitical uncertainties elsewhere.
• Resolution of tariff issues positively impacting the US economy and stock market growth.

Peterffy reiterates his belief in American exceptionalism, citing geography, the Constitution, and the American people as enduring pillars of economic strength.

Q&A Highlights

During the Q&A session, Peterffy addressed concerns about market volatility and competition:

• He reassured stakeholders of IBKR’s readiness to adapt to technological changes and market dynamics.
• He projected a positive future for the US markets, driven by innovation and investment inflows.

For a more detailed understanding, readers are encouraged to refer to the full transcript.

Full transcript - Global Exchange and Trading Conference:

Unidentified speaker, Host, Sandler and Piper Sandler: If I get your attention, first, thank everybody for coming. It’s great to be back for one session, this conference. It’s much an improved with Patrick here. But, like, as Brian introduced, twenty four, twenty five years ago, we started this conference. The focus the entire time, has been electronic trading and and the advancement in electronic trading, whether it be retail, exchanges, trading companies, crypto, etcetera.

But I couldn’t be more pleased to introduce the next speaker who brought automation to the options market, mister Thomas Pederffy. So, I’m proud to also serve on his board in full disclosure, but Thomas brought automation to the options market. He founded Interactive Brokers in in 1993, I believe. It it went public.

Thomas Peterffy, Chairman, Interactive Brokers: 1979 1977.

Unidentified speaker, Host, Sandler and Piper Sandler: The the predecessor, Timberhill.

Unidentified speaker, Voice over: Right. Right.

Unidentified speaker, Host, Sandler and Piper Sandler: We’re we’re proud to have assisted in bringing the company public here at Sandler and Piper Sandler back in 02/2007. He stepped down, but I can tell you as a board, he’s a very he’s an active very active chairman of the company. So I’m gonna start, Thomas, just to talk broadly and just talk about the economy because I think we’ve been in one of the most unique markets watching you know, paying attention to headlines, watching the volatility, and and you’ve had a good sort of view and grip on it. So what are you thinking about tariffs, interest rates, etcetera, the presidential, what do you call it, impacts of on the marketplace. Just as a as a leader of a major broker, you know, what’s your view on the marketplace and what’s going on?

Thomas Peterffy, Chairman, Interactive Brokers: So I just happened to be on Fox Business on on April 7 as the market was violently crashing. It it made a lower on forty eight fifty on the S and P index, and I just couldn’t understand why everybody saw the situation as dark as they did. I I couldn’t go along with the idea that Trump was just a crazy man, all set to destroy The United States. So we have seen Trump as president for four years being dragged through the mud with the insane Russia hoax and constantly attack with many other things, even worse than he is today. And in spite of that, he was able to keep his bits about him, and he had done a good job overall during his tenure.

My opinion of him is that he’s a very street smart and has remarkable memory, supports him extremely well in forming relationships, and helps him keeping in mind all the many years of issues he undertakes to deal with. The first four years were a great training ground for him, and I think he will be a very good president in the second four years. So for these reasons, what I saw in the markets that day was completely unwarranted. And I believe that over time, more and more people will be able to overcome his sometimes irritating and upsetting rhetoric and come over to my views of him. So when I when you think about tariffs and Trump, you must keep in mind that he’s only a year and a half only has a year and a half until the midterms to deal with the issues, and he doesn’t have the time to pussyfoot around.

And and you must understand his mindset, which is that when he says about when he’s what he what he says about what he is going to do is just the negotiating stance for the moment. And he always maintain the right to to change his mind. So I think that tariff issues will be largely resolved for the most part fairly soon, although it will have a very long tail and counterparties for a long time will not know for sure what the deal is that that they have really made. But as far as The US economy is concerned, the issue will have been resolved soon after soon soon thereafter and very favorably for The US. That is the reason why I called for the greatest bull market on April 7.

I think Trump will try to run the economy at rapid rate. I think it will be good for business and better for a and and better for opportunity seeking mobile nimble businesses, the starchy older ones. I think he will not view the deficits as seriously as many conservatives. I think deficits will be rising and inflation will rise along with it, but the economy will be very productive and business will, on balance, do very well over the next three years.

Unidentified speaker, Host, Sandler and Piper Sandler: So so it looks, Thomas, like you’ve embedded, that that’s an interesting view. It looks like you’ve embedded, you know, volatility, that volatility given the president and given the uncertainty over many things. And I think most people in the room know volatility, you know, is is good for the trading markets. So I wanna just turn to something more specifically to interactive, but that’s the retail environment. It’s been it’s been super strong.

As they talk to people in the hallway, they’re just amazed that that Interactive can put on, you know, account growth at 30% a year, that that the the, you know, the velocity of trading is up. So what’s your if that’s your view of the economy, what’s your view of the retail trader and sort of the sustain sustainability of this hyperactivity we’ve seen really for the last, six months, if not more?

Thomas Peterffy, Chairman, Interactive Brokers: So, obviously, my view of the economy is is that that it’s colored by the picture I just painted. And I think my thinking about the markets and retail and also professional investors who are most important segment of our Interactive Brokers customer base, I would say that about 20 to thirty twenty five to 30% of our clients are institutional or professional investors and traders, and the remaining 72 to 75% are retail. I include financial professionals, individual accounts, and professional as opposed to retail. So while the retail segment is much larger than the professional segment, our customers are what our our it it is raised really the professional segment that that determines the how how well our business is doing. With that with that said, and given my expectations for a very good business environment and rising markets, not only driven by business performance, but also by inflation.

I expect a happy customer base, more people coming into the markets, especially The US markets from all over the world. I also think that other markets around the world will not be as good as The US markets. This is due to deglobalization, the tariffs, and also to win decision on part of many countries about the rules for business and the question about social divisions and to what extent they want to control their economy by their governments. In other words, business in other countries will continue to be restrained by uncertainty of the laws and protection of private property and the tendency to redistribute profits and limit the growth of private enterprise. For the past twelve months ending in May, our customer accounts have grown by 32%, account equity by 29%, commissions by 32%, and interest income by 31%.

This is a very stable picture, and I expect it to continue at somewhat lower rates in the first as the first half of the year tends to be somewhat better than the second half. So in other words, from here, continuing for for the next six months, it will be lower, and then it will pick up again. And then we’ll be sitting here a year from now. I think the numbers will be pretty much the same.

Unidentified speaker, Host, Sandler and Piper Sandler: Nice. So given all the activity, there’s a lot of attention in the space, and I just wanna ask you about competition. You you have Robinhood as a as a competitor has has done a lot of things to bring, as they claim democratize the markets. You get a new, company gone coming it’s just came public, eToro. So, Thomas, how do you think about competition as you see these other, companies spring up, I guess?

Thomas Peterffy, Chairman, Interactive Brokers: Well, the brokerage business has always been competitive. Over the past thirty years, the business has gone digital. Many firms who did not convert in time have folded or got merged into other firms. Currently, all the large, well performing businesses are digital, but to a greater or lesser extent. I, of course, strongly believe that in order to remain in the game over the next two decades, you must be on the forefront of technology to be easily to be easily able to incorporate new technologies and to be able to offer those to your customers without much disruption.

I’m fairly certain that IBKR is well positioned for that, but I think it’s extremely important to be constantly embracing and adopting new technologies. As far as your question about HUD and Itoro is concerned, given the price earnings ratio of 45 for HUD, and I do not know what it is for Itoro, the market certainly believes that they have a much superior future to that of IBKR. I certainly go along with the notion that they are both great companies, but which one of us will eventually turn out to be the highest growth and best earner? Your guess is as good as mine, but you know where I keep my money.

Unidentified speaker, Host, Sandler and Piper Sandler: And it’s it’s done very well. Yeah. I since we’re on the topic of growth and we are ticking down here in time, but two areas of growth of this and if you’re following the retail markets and trade, but the two this this idea or phenomenon of twenty four hour trading is one, if you if you could just touch on that. And the other, I know you’re excited about this, but it’s ForecastX. It’s the the new event sort of futures platform that that you launched.

Thomas Peterffy, Chairman, Interactive Brokers: Okay. So twenty four hour trading. We we were a bit mistreated by markets and the news about twenty four hour trading because we have made our markets available for twenty four hours a day to our customers well before anybody else has done. But, you know, it’s always about Robin for four hour. But at any rate, twenty four hour training has become more and more acceptable.

And this is a a genie that I think would be very, very, difficult to put back into the puzzle. Twenty four hour trading is obviously very important to many people in the Far Middle And Near East, much more so than in The US or even in Europe. But our experience shows that volumes are rising extremely fast. Other institutions and exchanges are waking up to this reality, and I think that in three to five years, the overnight sessions will be just as liquid as markets currently are between 11AM and 1PM. In in May, ’2 point ’2 percent of our volume was done in overnight trading.

I expect this number to rise to about 25 to 30%, in the next twenty years. Now as far as forecast x, well, on the long run, people, I think, must be under three major fundamental forces. They number one is the environment as it’s shaped by the climate. And here, I’d like to show you a chart, if if I may. You guys have that chart?

Unidentified speaker, Host, Sandler and Piper Sandler: I think they do. Are they

Unidentified speaker, Voice over: I think there’s a I wanted to know the truth about climate change and leave the politics out of it. It. Over the past one hundred years, carbon dioxide in the atmosphere rose from hundred and five to 425 parts per million. Global temperatures increased by 1.5 degrees Celsius, about 2.7 degrees Fahrenheit, and sea level has risen by about nine inches. These changes happen gradually, though a little faster in recent decades.

There’s no question that climate change is happening. But how big a problem is climate change? Will it speed up or slow down? Interactive brokers created forecast trader so you can follow the data and forecast future outcomes. You can buy yes or no answers.

If you’re right, you earn a dollar per contract. How big a problem is climate change? Stay engaged. Go to ibkr.com/climate and look at the data. Be part of the decision by your forecast.

Let’s build a consensus and then decide what to do next.

Thomas Peterffy, Chairman, Interactive Brokers: So so climate change is certainly one one of the big questions. The second, of course, is is the various factors in the economy we that which determines our means and boundaries, and thirdly, politics. And so politics and the economy is is certainly and to an undetermined extent, the climate is under our control. But it is under our control communally and not individually. So the question is how to provide the individuals in our society with a tool to be able to exert their control over these forces in unison, in a coordinated manner, while still under their own individual self determination.

The the broad answer is that market forces direct us, but these four forces aren’t sufficiently explicit to answer each individual’s questions about what to do and when and how to do it to maximize their own contributions and their own benefits. Forecastry, there is an attempt to to go some way in that direction. We provide users with the historical data and current estimates of future data points, asking questions and giving feedback to users about coming events, unbiased consensus opinions about the decisions they need to make in their lives. As as as the questions and tools evolve, we intend to come ever closer to each individual and their particular situation to enable them to find the optimal decisions about how in view of their own needs and capabilities they can contribute the most and maximize the benefits they receive. On the long run, forecast contracts will be hedging too for professional users and analytical decision making tools for individuals.

Unidentified speaker, Host, Sandler and Piper Sandler: Thanks, Harness. We we brought multimedia to the conference here. We’re skip a couple. I think people should know if you don’t know, IBKR is gonna do a stock split in June 18. We’ve talked about valuation as well.

So, just given the amount of time I wanna get to the what I think is the most interesting question to to end up with, and that’s about, you know, American or or US exceptionalism. IBKR, as I think I I pretty well know, is unique in that it contributes to US exceptionalism. It’s a global broker that is all over the world. It’s looked at as a leading broker headquartered here in The US, but it also benefits because global investors, you know, as you have many times disclosed, you know, trade US stocks, and that’s the predominant thing. So what the question is, what do you believe the standing of The US US exceptionalism?

Will it continue? Will continue people continue to want to invest as aggressively, in The US as as prior?

Thomas Peterffy, Chairman, Interactive Brokers: No. I’m I’m a firm believer in in American exceptionalism. In my view, this exceptionalism rests on three unshakable foundations, each unique, each enduring, and unlikely to falter in the near foreseeable future. First, geography. The United States is blessed with vast fertile land, abundant natural resources, and two oceans that buffer it from many global threats.

It is ideal climate zones, navigable rivers, and internal trade routes have fueled prosperity. Unique geography has not only protected the nation but also enabled its rise as an economic and military powerhouse. Second, the constitution. More than a governing document, The US constitution is the bedrock of a stable and enduring democratic experiment. It limits power, protect free protects freedom, and provides the flexibility needed to adopt over the centuries.

Crucially, it lays down the ideal legal foundation for the evolution of a free market economy. One designed not for the benefit of the state, but for the empowerment and prosperity of a free people. It is the reason for The United States has achieved continuity without stagnation and order without tyranny. Third and most importantly, the people. Above all, it is the American people, diverse, ambitious, restless, who made the nation exceptional.

These are not just empty phrases. There is a solid evidence and reason for this. US citizens are a unique assembly, the descendants of individuals who at some point in their lives had the courage and enterprising spirit to leave their familiar homes behind in search of opportunities determined by determined to succeed in a new and different land. That spirit, indeed, the very DNA of boldness, curiosity, and aspiration is inherited. It has been passed on through the generations, and it continues to be renewed and strengthened by a constant infusion of newly arriving individuals who come to America in search of opportunity.

With a culture and and and and that that prices innovation, resilience, and individual liberty, Americans have repeatedly reshaped the world in technology, economics, and ideas. The spirit doesn’t wane. It will endure. Given my belief in American exceptionalism, ism, it is clear to me that The US economy will continue to prevail in the world. US stocks will keep on rising for a long time.

Investors from all over the world will keep on investing their excess funds in The United States.

Unidentified speaker, Host, Sandler and Piper Sandler: That’s a wrap. Thank you, Thomas. That this has been fun it’s been a flashback. You’ve contributed in Interactive Brokers, in my opinion, as a as a Hungarian immigrant that founded this company, a leading global broker, have contributed to US exceptionalism as well. So thank you.

Thomas Peterffy, Chairman, Interactive Brokers: Thank you.

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