Trading platform eToro beats profit estimates as retail investors ride market boom
The eToro logo is displayed on a screen during the company's IPO at the Nasdaq Market, in New York City, U.S., May 15, 2025. REUTERS/Brendan McDermid
Stock and crypto trading platform eToro beat estimates for third-quarter profit on Monday, as retail investors maintained their buying streak despite bubble worries, sending shares up 7 per cent in afternoon trading.
The equities rally has stoked concerns about a bubble, with some analysts warning that valuations in high-growth names appear stretched.
Equities hit record highs in the quarter as steady earnings, softer inflation expectations and optimism around the AI boom encouraged investors to move back into riskier assets. Gold has also continued its surge as the hottest asset on the commodities front.
"We have seen the gold craze hitting our customers in October, with gold reaching an all-time high," eToro CEO Yoni Assia told Reuters in an interview. "We've seen a lot of rebalancing of portfolios across both U.S. and European equities. I think we did see some sort of shaving off the top of some tech stocks in eToro."
The company's net contribution, which deducts the cost of revenue from crypto assets and margin interest expense, jumped 28 per cent from a year earlier to $215 million.
Newer fintech platforms have eroded the dominance of Wall Street incumbents in recent years, luring younger, tech-savvy investors with low fees, slick mobile apps and access to a wider asset range.
EToro posted adjusted profit of 60 cents per share in the three months ended September 30. Analysts had expected 56 cents per share, according to an average estimate compiled by LSEG.
It also announced a share repurchase program of up to $150 million.
GROWTH PLANS AND COMPETITION
"We're hungry and we have a large checkbook," Assia said on eToro's appetite for acquisitions. "I'm sure we'll find the right targets to add value to our customers."
The financial technology company's assets under administration grew by 76 per cent year-on-year to $20.8 billion.
A combination of accessible trading apps, volatile price moves and a steady flow of market news has persistently supported strong retail participation, helping these platforms maintain growth.
Prediction markets are also gaining ground with retail traders. EToro said it plans to launch in the space in late 2026.
The industry remains highly competitive, with neo-brokerages such as eToro and Robinhood seeking to win customers from Wall Street heavyweights such as Charles Schwab and Morgan Stanley's E*Trade.
In September, Robinhood launched a social investing platform, which lets users follow traders, view real-time trades, track live performance and discuss strategies, among other features.
"We've invented social trading. We've been doing this for 15 years, and as the company who invented the concept of copy (copycat investing), means that we think copy is a form of flattery," Assia said.
