Interactive Brokers Group Announces 4Q2022 Results

GAAP DILUTED EPS OF $1.31, ADJUSTED1 EPS OF $1.30

GAAP NET REVENUES OF $976 MILLION, ADJUSTED NET REVENUES OF $958 MILLION

GREENWICH, Conn.–(BUSINESS WIRE)–$IBKR #Earnings–Interactive Brokers Group, Inc. (Nasdaq: IBKR), an automated global electronic broker, announced results for the quarter ended December 31, 2022.

Reported diluted earnings per share were $1.31 for the current quarter and $1.30 as adjusted. For the year-ago quarter, reported diluted earnings per share were $0.67 and $0.83 as adjusted.

Reported net revenues were $976 million for the current quarter and $958 million as adjusted. For the year-ago quarter, reported net revenues were $603 million and $683 million as adjusted.

Reported income before income taxes was $689 million for the current quarter and $671 million as adjusted. For the year-ago quarter, reported income before income taxes was $373 million and $453 million as adjusted.

Financial Highlights

(All comparisons are to the year-ago quarter.)

  • Commission revenue increased 3% to $331 million on higher customer futures trading volume and larger average trade size in options, tempered by lower customer stock trading volume.
  • Net interest income increased 92% to $565 million on higher benchmark interest rates and customer credit balances, despite a decline in margin lending balances.
  • Other income increased $107 million to a gain of $37 million. This increase was mainly comprised of $58 million related to our strategic investment in Up Fintech Holding Limited (“Tiger Brokers”), $34 million related to our currency diversification strategy and $6 million related to the remeasurement of our Tax Receivable Agreement liability.
  • Reported pretax profit margin was 71% for the current quarter and 70% as adjusted. For the year-ago quarter, reported pretax margin was 62% and 66% as adjusted.
  • Total equity of $11.6 billion.

The Interactive Brokers Group, Inc. Board of Directors declared a quarterly cash dividend of $0.10 per share. This dividend is payable on March 14, 2023, to shareholders of record as of March 1, 2023.

____________________________

1 See the reconciliation of non-GAAP financial measures starting on page 9.

Business Highlights

(All comparisons are to the year-ago quarter.)

  • Customer accounts increased 25% to 2.09 million.
  • Customer equity decreased 18% to $306.7 billion.
  • Total DARTs2 decreased 22% to 1.89 million.
  • Cleared DARTs decreased 22% to 1.69 million.
  • Customer credits increased 9% to $95.2 billion.
  • Customer margin loans decreased 29% to $38.9 billion.

Effects of Foreign Currency Diversification

In connection with our currency diversification strategy, we base our net worth in GLOBALs, a basket of 10 major currencies in which we hold our equity. In this quarter, our currency diversification strategy increased our comprehensive earnings by $169 million, as the U.S. dollar value of the GLOBAL increased by approximately 1.65%. The effects of the currency diversification strategy are reported as components of (1) Other Income (gain of $11 million) and (2) Other Comprehensive Income (gain of $158 million).

Conference Call Information:

Interactive Brokers Group, Inc. will hold a conference call with investors today, January 17, 2023, at 4:30 p.m. ET to discuss its quarterly results. Members of the public who would like to listen to the conference call should register at https://register.vevent.com/register/BI026f8edd62a546f3b96958af68b730d5 to obtain the dial-in details. The number should be dialed approximately ten minutes prior to the start of the conference call. The conference call will also be accessible simultaneously, and through replays, as an audio webcast through the Investor Relations section of the Interactive Brokers web site, www.interactivebrokers.com/ir.

About Interactive Brokers Group, Inc.:

Interactive Brokers Group affiliates provide automated trade execution and custody of securities, commodities and foreign exchange around the clock on over 150 markets in numerous countries and currencies, from a single unified platform to clients worldwide. We service individual investors, hedge funds, proprietary trading groups, financial advisors and introducing brokers. Our four decades of focus on technology and automation has enabled us to equip our clients with a uniquely sophisticated platform to manage their investment portfolios. We strive to provide our clients with advantageous execution prices and trading, risk and portfolio management tools, research facilities and investment products, all at low or no cost, positioning them to achieve superior returns on investments. For the fifth consecutive year, Barron’s ranked Interactive Brokers #1 with 5 out of 5 stars in its March 25, 2022, Best Online Brokers Review.

Cautionary Note Regarding Forward-Looking Statements:

The foregoing information contains certain forward-looking statements that reflect the Company’s current views with respect to certain current and future events and financial performance. These forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the Company’s operations and business environment which may cause the Company’s actual results to be materially different from any future results, expressed or implied, in these forward-looking statements. Any forward-looking statements in this release are based upon information available to the Company on the date of this release. The Company does not undertake to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any statements expressed or implied therein will not be realized. Additional information on risk factors that could potentially affect the Company’s financial results may be found in the Company’s filings with the Securities and Exchange Commission.

_____________________________

2 Daily average revenue trades (DARTs) are based on customer orders.

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

 
Three Months Twelve Months
Ended December 31, Ended December 31,

2022

2021

2022

2021

(in millions, except share and per share data)
 
Revenues:
Commissions

$

331

 

 

$

320

 

 

$

1,322

 

 

$

1,350

 

Other fees and services

 

43

 

 

 

58

 

 

 

184

 

 

 

218

 

Other income (loss)

 

37

 

 

 

(70

)

 

 

(107

)

 

 

(2

)

Total non-interest income

 

411

 

 

 

308

 

 

 

1,399

 

 

 

1,566

 

 

 

 

 

 

 

 

Interest income

 

1,111

 

 

 

350

 

 

 

2,686

 

 

 

1,372

 

Interest expense

 

(546

)

 

 

(55

)

 

 

(1,018

)

 

 

(224

)

Total net interest income

 

565

 

 

 

295

 

 

 

1,668

 

 

 

1,148

 

Total net revenues

 

976

 

 

 

603

 

 

 

3,067

 

 

 

2,714

 

 

 

 

 

 

 

 

Non-interest expenses:

 

 

 

 

 

 

 

Execution, clearing and distribution fees

 

90

 

 

 

53

 

 

 

324

 

 

 

236

 

Employee compensation and benefits

 

119

 

 

 

108

 

 

 

454

 

 

 

399

 

Occupancy, depreciation and amortization

 

22

 

 

 

22

 

 

 

90

 

 

 

80

 

Communications

 

8

 

 

 

9

 

 

 

33

 

 

 

33

 

General and administrative

 

48

 

 

 

38

 

 

 

165

 

 

 

176

 

Customer bad debt

 

 

 

 

 

 

 

3

 

 

 

3

 

Total non-interest expenses

 

287

 

 

 

230

 

 

 

1,069

 

 

 

927

 

 

 

 

 

 

 

 

Income before income taxes

 

689

 

 

 

373

 

 

 

1,998

 

 

 

1,787

 

Income tax expense

 

56

 

 

 

35

 

 

 

156

 

 

 

151

 

Net income

 

633

 

 

 

338

 

 

 

1,842

 

 

 

1,636

 

Net income attributable to noncontrolling interests

 

497

 

 

 

271

 

 

 

1,462

 

 

 

1,328

 

Net income available for common stockholders

$

136

 

 

$

67

 

 

$

380

 

 

$

308

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

Basic

$

1.32

 

 

$

0.68

 

 

$

3.78

 

 

$

3.27

 

Diluted

$

1.31

 

 

$

0.67

 

 

$

3.75

 

 

$

3.24

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

Basic

 

102,875,250

 

 

 

98,181,875

 

 

 

100,460,016

 

 

 

94,167,572

 

Diluted

 

103,656,668

 

 

 

98,980,339

 

 

 

101,299,609

 

 

 

95,009,880

 

 

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(UNAUDITED)

 
Three Months Twelve Months
Ended December 31, Ended December 31,

2022

2021

2022

2021

(in millions, except share and per share data)
 
Comprehensive income:
Net income available for common stockholders

$

136

 

$

67

 

 

$

380

 

 

$

308

 

Other comprehensive income:

 

 

 

 

 

 

 

Cumulative translation adjustment, before income taxes

 

38

 

 

(1

)

 

 

(26

)

 

 

(22

)

Income taxes related to items of other comprehensive income

 

 

 

 

 

 

 

 

 

 

Other comprehensive income (loss), net of tax

 

38

 

 

(1

)

 

 

(26

)

 

 

(22

)

Comprehensive income available for common stockholders

$

174

 

$

66

 

 

$

354

 

 

$

286

 

 

 

 

 

 

 

 

Comprehensive earnings per share:

 

 

 

 

 

 

 

Basic

$

1.70

 

$

0.67

 

 

$

3.53

 

 

$

3.04

 

Diluted

$

1.68

 

$

0.67

 

 

$

3.50

 

 

$

3.01

 

 

 

 

 

 

 

 

Weighted average common shares outstanding:

 

 

 

 

 

 

 

Basic

 

102,875,250

 

 

98,181,875

 

 

 

100,460,016

 

 

 

94,167,572

 

Diluted

 

103,656,668

 

 

98,980,339

 

 

 

101,299,609

 

 

 

95,009,880

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income attributable to noncontrolling interests:

 

 

 

 

 

 

 

Net income attributable to noncontrolling interests

$

497

 

$

271

 

 

$

1,462

 

 

$

1,328

 

Other comprehensive income – cumulative translation adjustment

 

120

 

 

(1

)

 

 

(85

)

 

 

(75

)

Comprehensive income attributable to noncontrolling interests

$

617

 

$

270

 

 

$

1,377

 

 

$

1,253

 

 
INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION

(UNAUDITED)

 
December 31,
2022
December 31,
2021
(in millions)
 
Assets
Cash and cash equivalents $

3,436

$

2,395

 

Cash – segregated for regulatory purposes

25,167

22,888

 

Securities – segregated for regulatory purposes

31,781

15,121

 

Securities borrowed

4,749

3,912

 

Securities purchased under agreements to resell

6,029

4,380

 

Financial instruments owned, at fair value

485

673

 

Receivables from customers, net of allowance for credit losses

38,760

54,935

 

Receivables from brokers, dealers and clearing organizations

3,469

3,771

 

Other assets

1,267

1,038

 

Total assets $

115,143

$

109,113

 

 
Liabilities and equity
 
Liabilities
Short-term borrowings $

18

$

27

 

Securities loaned

8,940

11,769

 

Financial instruments sold but not yet purchased, at fair value

146

182

 

Other payables:
Customers

93,195

85,634

 

Brokers, dealers and clearing organizations

291

557

 

Other payables

938

722

 

94,424

86,913

 

Total liabilities

103,528

98,891

 

 
Equity
Stockholders’ equity

2,848

2,395

 

Noncontrolling interests

8,767

7,827

 

Total equity

11,615

10,222

 

Total liabilities and equity $

115,143

$

109,113

 

 
 
December 31, 2022 December 31, 2021
Ownership of IBG LLC Membership Interests Interests % Interests %
 
IBG, Inc.

102,927,703

24.5

%

98,230,127

23.5

%

Noncontrolling interests (IBG Holdings LLC)

316,609,102

75.5

%

319,880,492

76.5

%

Total IBG LLC membership interests

419,536,805

100.0

%

418,110,619

100.0

%

 

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

OPERATING DATA

 
TRADE VOLUMES:
(in 000’s, except %)
 

Cleared

 

 

 

Non-Cleared

 

 

 

 

 

 

 

 

 

 

 

Avg. Trades

Customer

 

%

 

Customer

 

%

 

Principal

 

%

 

Total

 

%

 

per U.S.

Period

Trades

 

Change

 

Trades

 

Change

 

Trades

 

Change

 

Trades

 

Change

 

Trading Day

2020

620,405

56,834

27,039

704,278

2,795

2021

871,319

40%

78,276

38%

32,621

21%

982,216

39%

3,905

2022

735,619

(16%)

70,049

(11%)

32,863

1%

838,531

(15%)

3,347

 

4Q2021

207,457

19,961

8,001

235,419

3,707

4Q2022

165,769

(20%)

14,923

(25%)

7,358

(8%)

188,050

(20%)

3,009

 

3Q2022

170,240

16,181

7,953

194,374

3,037

4Q2022

165,769

(3%)

14,923

(8%)

7,358

(7%)

188,050

(3%)

3,009

 
CONTRACT AND SHARE VOLUMES:
(in 000’s, except %)
 

TOTAL

Options

 

%

 

Futures1

 

%

 

Stocks

 

%

Period

(contracts)

 

Change

 

(contracts)

 

Change

 

(shares)

 

Change

2020

624,035

167,078

338,513,068

2021

887,849

42%

154,866

(7%)

771,273,709

128%

2022

908,415

2%

207,138

34%

330,035,586

(57%)

 

4Q2021

244,349

41,997

117,410,095

4Q2022

229,441

(6%)

51,519

23%

75,713,964

(36%)

 

3Q2022

215,988

50,486

75,776,756

4Q2022

229,441

6%

51,519

2%

75,713,964

(0%)

 

ALL CUSTOMERS

Options

 

%

 

Futures1

 

%

 

Stocks

 

%

Period

(contracts)

 

Change

 

(contracts)

 

Change

 

(shares)

 

Change

2020

584,195

164,555

331,263,604

2021

852,169

46%

152,787

(7%)

766,211,726

131%

2022

873,914

3%

203,933

33%

325,368,714

(58%)

 

4Q2021

235,400

41,318

116,546,652

4Q2022

221,855

(6%)

50,773

23%

74,353,901

(36%)

 

3Q2022

208,145

49,725

74,944,418

4Q2022

221,855

7%

50,773

2%

74,353,901

(1%)

 

CLEARED CUSTOMERS

Options

 

%

 

Futures1

 

%

 

Stocks

 

%

Period

(contracts)

 

Change

 

(contracts)

 

Change

 

(shares)

 

Change

2020

518,965

163,101

320,376,365

2021

773,284

49%

151,715

(7%)

752,720,070

135%

2022

781,373

1%

202,145

33%

314,462,672

(58%)

 

4Q2021

213,143

41,096

113,441,967

4Q2022

194,962

(9%)

50,326

22%

71,924,864

(37%)

 

3Q2022

185,166

49,242

72,394,078

4Q2022

194,962

5%

50,326

2%

71,924,864

(1%)

 
1 Includes options on futures

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

OPERATING DATA, CONTINUED

 
CONTRACT AND SHARE VOLUMES, continued:
(in 000’s, except %)
 

PRINCIPAL TRANSACTIONS

Options

 

%

 

Futures1

 

%

 

Stocks

 

%

Period

(contracts)

 

Change

 

(contracts)

 

Change

 

(shares)

 

Change

2020

39,840

2,523

7,249,464

2021

35,680

(10%)

2,079

(18%)

5,061,983

(30%)

2022

34,501

(3%)

3,205

54%

4,666,872

(8%)

 

4Q2021

8,949

679

863,443

4Q2022

7,586

(15%)

746

10%

1,360,063

58%

 

3Q2022

7,843

761

832,338

4Q2022

7,586

(3%)

746

(2%)

1,360,063

63%

 
1 Includes options on futures
 
CUSTOMER STATISTICS
 
Year over Year

4Q2022

4Q2021

% Change

Total Accounts (in thousands)

 

2,091

 

 

1,676

 

25%

Customer Equity (in billions)1

$

306.7

 

$

373.8

 

(18%)

 

 

 

 

 

Cleared DARTs (in thousands)

 

1,689

 

 

2,162

 

(22%)

Total Customer DARTs (in thousands)

 

1,889

 

 

2,436

 

(22%)

 

 

 

 

 

Cleared Customers

 

 

 

 

 

Commission per Cleared Commissionable Order2

$

3.15

 

$

2.38

 

32%

Cleared Avg. DARTs per Account (Annualized)

 

206

 

 

339

 

(39%)

 

 

 

 

 

Consecutive Quarters

4Q2022

 

3Q2022

 

% Change

Total Accounts (in thousands)

 

2,091

 

 

2,012

 

4%

Customer Equity (in billions)1

$

306.7

 

$

287.1

 

7%

 

 

 

 

 

Cleared DARTs (in thousands)

 

1,689

 

 

1,706

 

(1%)

Total Customer DARTs (in thousands)

 

1,889

 

 

1,920

 

(2%)

 

 

 

 

 

Cleared Customers

 

 

 

 

 

Commission per Cleared Commissionable Order2

$

3.15

 

$

2.96

 

6%

Cleared Avg. DARTs per Account (Annualized)

 

206

 

 

217

 

(5%)

 
(1) Excludes non-Customers.
(2) Commissionable Order – a customer order that generates commissions.

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

NET INTEREST MARGIN

(UNAUDITED)

 
Three Months Twelve Months
Ended December 31, Ended December 31,

2022

2021

2022

2021

 
(in millions)
Average interest-earning assets
Segregated cash and securities $

57,327

 

$

37,674

 

$

51,644

 

$

40,328

 

Customer margin loans

39,277

 

51,889

 

43,402

 

45,681

 

Securities borrowed

4,368

 

3,200

 

3,961

 

3,677

 

Other interest-earning assets

9,203

 

7,861

 

9,000

 

7,029

 

FDIC sweeps1

2,347

 

2,377

 

2,229

 

2,663

 

$

112,522

 

$

103,001

 

$

110,235

 

$

99,376

 

 
Average interest-bearing liabilities
Customer credit balances $

93,401

 

$

83,001

 

$

90,172

 

$

79,297

 

Securities loaned

9,071

 

10,810

 

10,095

 

10,871

 

Other interest-bearing liabilities

1

 

1

 

4

 

109

 

$

102,473

 

$

93,812

 

$

100,271

 

$

90,277

 

 
Net interest income
Segregated cash and securities, net $

454

 

$

(5

)

$

742

 

$

(9

)

Customer margin loans2

420

 

149

 

1,083

 

535

 

Securities borrowed and loaned, net

73

 

134

 

413

 

568

 

Customer credit balances, net2

(487

)

8

 

(763

)

33

 

Other net interest income1/3

112

 

11

 

207

 

36

 

Net interest income3 $

572

 

$

297

 

$

1,682

 

$

1,163

 

 
Net interest margin (“NIM”)

2.02

%

1.14

%

1.53

%

1.17

%

 
Annualized yields
Segregated cash and securities

3.14

%

-0.05

%

1.44

%

-0.02

%

Customer margin loans

4.24

%

1.14

%

2.50

%

1.17

%

Customer credit balances

2.07

%

-0.04

%

0.85

%

-0.04

%

______________________________________

1

Represents the average amount of customer cash swept into FDIC-insured banks as part of our Insured Bank Deposit Sweep Program. This item is not recorded in the Company’s consolidated statements of financial condition. Income derived from program deposits is reported in other net interest income in the table above.

2

 

Interest income and interest expense on customer margin loans and customer credit balances, respectively, are calculated on daily cash balances within each customer’s account on a net basis, which may result in an offset of balances across multiple account segments (e.g., between securities and commodities segments).

3

 

Includes income from financial instruments that has the same characteristics as interest, but is reported in other fees and services and other income in the Company’s consolidated statements of comprehensive income. For the three and twelve months ended December 31, 2022 and 2021, $3 million, $1 million, $10 million, and $15 million were reported in other fees and services, respectively. For the three and twelve months ended December 31, 2022 and 2021, $3 million, $1 million, $4 million, and $0 million were reported in other income, respectively.

   

INTERACTIVE BROKERS GROUP, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(UNAUDITED)

 
Three Months Twelve Months
Ended December 31, Ended December 31,

2022

2021

2022

2021

 
(in millions)
 
Adjusted net revenues1
Net revenues – GAAP $

976

 

$

603

 

$

3,067

 

$

2,714

 

 
Non-GAAP adjustments
Currency diversification strategy, net

(11

)

23

 

100

 

37

 

Mark-to-market on investments2

(1

)

57

 

52

 

30

 

Remeasurement of TRA liability3

(6

)

 

(6

)

(1

)

Total non-GAAP adjustments

(18

)

80

 

146

 

66

 

Adjusted net revenues $

958

 

$

683

 

$

3,213

 

$

2,780

 

 
Adjusted income before income taxes1
Income before income taxes – GAAP $

689

 

$

373

 

$

1,998

 

$

1,787

 

Non-GAAP adjustments
Currency diversification strategy, net

(11

)

23

 

100

 

37

 

Mark-to-market on investments2

(1

)

57

 

52

 

30

 

Remeasurement of TRA liability3

(6

)

 

(6

)

(1

)

Total non-GAAP adjustments

(18

)

80

 

146

 

66

 

 
Adjusted income before income taxes $

671

 

$

453

 

$

2,144

 

$

1,853

 

 
Adjusted pre-tax profit margin

70

%

66

%

67

%

67

%

 
Three Months Twelve Months
Ended December 31, Ended December 31,

2022

2021

2022

2021

 
(in millions)
Adjusted net income available for common stockholders1
Net income available for common stockholders – GAAP $

136

 

$

67

 

$

380

 

$

308

 

 
Non-GAAP adjustments
Currency diversification strategy, net

(3

)

6

 

24

 

8

 

Mark-to-market on investments2

(0

)

13

 

13

 

7

 

Remeasurement of TRA liability3

(6

)

0

 

(6

)

(1

)

Income tax effect of above adjustments4

1

 

(4

)

(7

)

(3

)

Remeasurement of deferred income taxes5

7

 

 

7

 

1

 

Total non-GAAP adjustments

(1

)

15

 

30

 

12

 

Adjusted net income available for common stockholders $

134

 

$

82

 

$

410

 

$

320

 

 
Note: Amounts may not add due to rounding.
 
Three Months Twelve Months
Ended December 31, Ended December 31,

2022

2021

2022

2021

 
(in dollars)
Adjusted diluted EPS1
 
Diluted EPS – GAAP $

1.31

 

$

0.67

 

$

3.75

 

$

3.24

 

 
Non-GAAP adjustments
Currency diversification strategy, net

(0.03

)

0.06

 

0.24

 

0.09

 

Mark-to-market on investments2

(0.00

)

0.13

 

0.12

 

0.07

 

Remeasurement of TRA liability3

(0.06

)

0.00

 

(0.06

)

(0.01

)

Income tax effect of above adjustments4

0.01

 

(0.04

)

(0.07

)

(0.03

)

Remeasurement of deferred income taxes5

0.07

 

0.00

 

0.07

 

0.01

 

Total non-GAAP adjustments

(0.01

)

0.15

 

0.30

 

0.13

 

Adjusted diluted EPS $

1.30

 

$

0.83

 

$

4.05

 

$

3.37

 

 
Diluted weighted average common shares outstanding

103,656,668

 

98,980,339

 

101,299,609

 

95,009,880

 

 
Note: Amounts may not add due to rounding.

Note: The term “GAAP” in the following explanation refers to generally accepted accounting principles in the United States.

1 Adjusted net revenues, adjusted income before income taxes, adjusted net income available for common stockholders and adjusted diluted earnings per share (“EPS”) are non-GAAP financial measures as defined by SEC Regulation G.

  • We define adjusted net revenues as net revenues adjusted to remove the effect of our currency diversification strategy and our net mark-to-market gains (losses) on investments2.
  • We define adjusted income before income taxes as income before income taxes adjusted to remove the effect of our currency diversification strategy and our net mark-to-market gains (losses) on investments.
  • We define adjusted net income available to common stockholders as net income available for common stockholders adjusted to remove the after-tax effects attributable to IBG, Inc. of our currency diversification strategy and our mark-to-market gains (losses) on investments.

Management believes these non-GAAP items are important measures of our financial performance because they exclude certain items that may not be indicative of our core operating results and business outlook and may be useful to investors and analysts in evaluating the operating performance of the business and facilitating a meaningful comparison of our results in the current period to those in prior and future periods. Our currency diversification strategy and our mark-to-market on investments are excluded because management does not believe they are indicative of our underlying core business performance. Adjusted net revenues, adjusted income before income taxes, adjusted net income available to common stockholders and adjusted diluted EPS should be considered in addition to, rather than as a substitute for, GAAP net revenues, income before income taxes, net income attributable to common stockholders and diluted EPS.

2 Mark-to-market on investments represents the net mark-to-market gains (losses) on our U.S. government and municipal securities portfolio, which are typically held to maturity, investments in equity securities that do not qualify for equity method accounting which are measured at fair value, and certain other investments, including equity securities taken over by the Company from customers related to losses on margin loans.

3 Remeasurement of our tax receivable agreement (“TRA”) liability represents the change in the amount payable to IBG Holdings LLC under the TRA, primarily due to changes in the Company’s effective tax rates. This is related to the remeasurement of the deferred tax assets described below. For further information refer to Note 4 – Equity and Earnings per Share under Part II, Item 8 – Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10 K filed with the Securities Exchange Commission (“SEC”) on February 25, 2022.

4 The income tax effect is estimated using the corporate income tax rates applicable to the Company.

5 Remeasurement of certain deferred tax assets represents the change in the unamortized balance of deferred tax assets related to the step-up in basis arising from the acquisition of interests in IBG LLC, primarily due to changes in the Company’s effective tax rates. For further information refer to Note 4 – Equity and Earnings per Share under Part II, Item 8 – Financial Statements and Supplementary Data of the Company’s Annual Report on Form 10 K filed with the Securities Exchange Commission (“SEC”) on February 25, 2022.

Contacts

For Interactive Brokers Group, Inc.

Investors:

Nancy Stuebe

[email protected]

Media:

Rob Garfield

[email protected].

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