Trading and investing platform eToro Group (NASDAQ: ETOR) reported first-quarter adjusted earnings of 91 cents per share, beating analyst estimates by 25 percent as a surge in commodities trading offset a slump in crypto activity.
“I’m incredibly proud of the eToro team for delivering our strongest quarterly financial results as a public company, while continuing to accelerate product innovation,” Yoni Assia, CEO and Co-Founder of eToro, said in a statement.
The company's results for the quarter ending March 31 showed the benefits of its multi-asset model, with many users who originally joined for crypto or equities shifting to commodities trading. Net contribution, a measure of revenue, increased 19 percent year-over-year to $258 million.
Shares of eToro rose 6.5 percent in premarket trading following the announcement. The results highlight a durable pattern where market volatility drives users to hedge and rebalance, boosting trading commissions for the platform.
The primary driver of the earnings beat was the capital markets business, where net trading contribution jumped 71 percent year-over-year to a record $166 million. Commodities trading was the standout performer, with volumes increasing nearly fourfold from the prior year and accounting for 60 percent of all trading commissions during the quarter.
In contrast, net trading contribution from crypto fell to $13 million, which included a $5 million negative valuation impact from the company’s corporate crypto holdings. Data for April showed the trend continuing, with capital markets trades up 50 percent year-over-year while crypto trades declined 32 percent.
Funded accounts showed steady growth, rising 12 percent from a year ago to 4.02 million, which executives called the fastest organic growth in over a year. Assets under administration reached $17 billion, a 15 percent increase.
The company also highlighted its recent acquisition of ZenGo, a self-custodial crypto wallet provider. Assia said the deal advances eToro’s strategy of connecting traditional finance with on-chain infrastructure and expands its access to thousands of additional crypto assets.
The strong quarterly performance and growth in funded accounts suggest eToro's multi-asset platform is successfully retaining users even as their trading interests shift. Investors will watch the company's U.S. expansion plans for commodities trading and its CopyTrader portfolios in the second half of the year for further growth.
This article is for informational purposes only and does not constitute investment advice.
