Etoro's third-quarter profit plunged 74% year over year as a cryptocurrency trading slump weighed on the brokerage firm. Etoro's stock ended Tuesday's trading session down 7.6%. The benchmark S&P 500 fell just 0.4%.
Etoro reported on Tuesday that third-quarter net income came in at $15 million, down from $57 million for the same quarter in 2025. Wall Street analysts had been expecting profit of $22 million, according to estimates compiled by FactSet. On an adjusted basis, etoro's net income was $24 million, the company said.
Adjusted diluted earnings per share came in at 26 cents, narrowly missing analyst expectations of 27 cents, according to FactSet.
Net contribution, which represents total revenue and income, minus the cost of revenue from cryptoassets and margin interest expense, decreased by 13% year over year to $186 million. Analysts had anticipated that figure to come in at $187.2 million, according to FactSet.
Also on Tuesday, etoro announced a $250 million share repurchase program.
The brokerage firm has been striving to grow its customer base by adding more products and services, such as giving customers the ability to use artificial intelligence to aid their research and trading. Etoro's efforts showed signs of paying off. The company said funded accounts rose 18% year over year to 4.39 million. Seventy-three percent of etoro's funded accounts are in Europe and 10% are in the Americas.
The company expects its acquisition of TradeZero, a trading platform for active traders, to close in the first half of 2027. The deal will give etoro a footprint in Canada and an expanded offering in the U.S.
Speaking from Miami, etoro CEO Yoni Assia tells Barron's that the acquisition will expand his company's offering for clients and will accelerate the company's push into the U.S.
"It is very important for our U.S. franchise," Assia says. "I believe the combination of etoro and TradeZero puts us on par with the biggest companies in the U.S."
He says that etoro has been steadily attracting new customers (the average age of customers is 35) and it's making steady progress providing users with artificial intelligence capabilities, which could lead to higher trading volumes. Assia says that about 20,000 customers have connected their preferred AI chatbot to dedicated agentic trading accounts at etoro. "I think we are in very early stages of people trusting AI to take actions in their investment accounts," he says.
Separately, etoro said last week that it has agreed to acquire LB Finanzas, a digital investment and payments platform in Argentina. Etoro didn't disclose terms of the deal.
But even as etoro adds more accounts and customers continue trading stocks, commodities, and currencies, overall trading activity has fallen this year. Total trades came in at 156 million for the quarter, according to the company's earnings presentation. That was up from 151 million for the same period a year ago, but down from 253 million for the first quarter.
The company said net crypto trading contribution for the quarter came to $26 million, down from $56 million for the same period a year ago.
Etoro released October metrics indicating continued softness. It said the total number of crypto trades for October was 2 million, down 62% year over year. Invested amount per trade for October was $228, down 29% year over year.
"Expectations were low, but the miss combined with [a] likely shortfall to October consensus metrics [is] likely to keep pressure on the stock," TD Cowen analyst Bill Katz wrote in a Tuesday research note.
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