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eToro UK's 2023 Net Income Drops 15% as Trading Commissions Decline

Pat Crawley
Pat Crawley
33 Min Read
etoro-uk's-2023-net-income-drops-15%-as-trading-commissions-decline

Thursday, 03/10/2024 | 15:24 GMT by Jared Kirui

  • Despite higher trading costs and economic headwinds, the firm reportedly invested heavily in research and development.
  • eToro UK increased its total assets by 41% year over year to more than $60 million.

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eToro UK released its financial results for the year 2023, highlighting a mixed performance during this period. Net income dropped by a double-digit following a decline in trading commissions, which form a larger part of the company’s revenues.

“2023 saw a gradual thawing of financial markets following almost a year of bear territory, allowing many retail investors to reverse losses from 2022 and get their portfolios back on track,” the firm highlighted in the financial report filed with Companies House Services.

“However, whilst last year was a big improvement on its predecessor, aside from the gargantuan AI-fuelled performance of bug US tech stocks, particularly the so-called “Magnificent 7”, it was a case of slow and steady for markets grappling with higher interest rates and other economic headwinds.”

Economic Headwinds

eToro UK’s net income dropped 14% year over year to $125,736,161, following a 19% decline in trading commissions to $106,021,023. Although the trading costs nearly doubled in the period, the company managed to reduce administrative expenses by 10%. Overall, the total comprehensive income decreased by 28% to $2,471,265.

eToro UK generated total commissions of nearly $630 million in 2023 and more than $100 million in EBITDA. The group also expanded its offerings, including launching ISA products in the UK, proxy voting, and extended-hours trading products. Additionally, the company reportedly enabled UK clients to trade assets from the GBP eToro Money account.

“We saw a low level of volatility in 2023 with various markets such as commodities and crypto remaining fairly muted for the majority of the year,” a spokesperson from the company told Finance Magnates.

“During 2023, we also invested heavily in new products and features whilst further developing our ISA offering. This approach is already paying off, with 2024 shaping up to be one of the strongest ever years for our UK business.”

Total Assets

Notably, eToro UK increased its total assets by 41% year over year, from $42,439,176 to $67,346,461, and ended the year with more than 35 million registered users globally and 3 million funded accounts (which increased by 5%).

“Towards the end of the year, we also saw bitcoin start to rally ahead of January’s approval of a spot Bitcoin ETF,” the company added. “This momentum has continued into 2024 as a multi-asset investing platform; eToro UK has been well positioned for the crypto comeback, providing users with straightforward access to crypto alongside a wide range of other asset classes.”

Last month, eToro UK acquired the Australian investing app Spaceship for $55 million. This move aims to boost the Israel-based company’s position in the savings sector and focus on more passive, long-term investments. Spaceship has more than 200,000 clients and manages more than $1 billion worth of assets.

eToro UK released its financial results for the year 2023, highlighting a mixed performance during this period. Net income dropped by a double-digit following a decline in trading commissions, which form a larger part of the company’s revenues.

“2023 saw a gradual thawing of financial markets following almost a year of bear territory, allowing many retail investors to reverse losses from 2022 and get their portfolios back on track,” the firm highlighted in the financial report filed with Companies House Services.

“However, whilst last year was a big improvement on its predecessor, aside from the gargantuan AI-fuelled performance of bug US tech stocks, particularly the so-called “Magnificent 7”, it was a case of slow and steady for markets grappling with higher interest rates and other economic headwinds.”

Economic Headwinds

eToro UK’s net income dropped 14% year over year to $125,736,161, following a 19% decline in trading commissions to $106,021,023. Although the trading costs nearly doubled in the period, the company managed to reduce administrative expenses by 10%. Overall, the total comprehensive income decreased by 28% to $2,471,265.

eToro UK generated total commissions of nearly $630 million in 2023 and more than $100 million in EBITDA. The group also expanded its offerings, including launching ISA products in the UK, proxy voting, and extended-hours trading products. Additionally, the company reportedly enabled UK clients to trade assets from the GBP eToro Money account.

“We saw a low level of volatility in 2023 with various markets such as commodities and crypto remaining fairly muted for the majority of the year,” a spokesperson from the company told Finance Magnates.

“During 2023, we also invested heavily in new products and features whilst further developing our ISA offering. This approach is already paying off, with 2024 shaping up to be one of the strongest ever years for our UK business.”

Total Assets

Notably, eToro UK increased its total assets by 41% year over year, from $42,439,176 to $67,346,461, and ended the year with more than 35 million registered users globally and 3 million funded accounts (which increased by 5%).

“Towards the end of the year, we also saw bitcoin start to rally ahead of January’s approval of a spot Bitcoin ETF,” the company added. “This momentum has continued into 2024 as a multi-asset investing platform; eToro UK has been well positioned for the crypto comeback, providing users with straightforward access to crypto alongside a wide range of other asset classes.”

Last month, eToro UK acquired the Australian investing app Spaceship for $55 million. This move aims to boost the Israel-based company’s position in the savings sector and focus on more passive, long-term investments. Spaceship has more than 200,000 clients and manages more than $1 billion worth of assets.

Jared Kirui

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Jared is an experienced financial journalist passionate about all things forex and CFDs.

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