eToro beats Q1 profit estimates as commodities trading surges

Trading and investing platform eToro reported stronger-than-expected first-quarter earnings on Tuesday, helped by a sharp increase in commodities trading activity during a volatile market environment.Shares of the company rose 6.5% in premarket trading. The stock has gained nearly 10% so far this year as of the previous close.Markets remained volatile during the first three months of 2026 as tensions in the Middle East fuelled inflation concerns and unsettled investors across global asset classes.Such periods of uncertainty often benefit trading platforms as investors rebalance portfolios to hedge against risks.Commodities trading drives growtheToro said net trading contribution from equities, commodities, and currencies jumped 71% year-over-year to $166 million during the quarter ended March 31.Commodities trading emerged as the company’s biggest growth driver.The segment accounted for nearly 60% of trading commissions during the quarter, while trading volumes surged almost fourfold compared to the same period last year.The company also expanded its offering during the quarter by introducing 24/7 trading for commodities, equities and indices.Overall net contribution increased 19% year-over-year to $258 million, compared with $217 million in the first quarter of 2025.Adjusted quarterly profit rose to $86 million, or 91 cents per share, from $67 million, or 77 cents per share, a year earlier.Analysts had expected earnings of 73 cents per share, according to estimates compiled by LSEG.Net income under GAAP standards increased 37% to $82 million, while adjusted EBITDA climbed 35% to $109 million.CEO highlights AI and crypto expansionYoni Assia, CEO and Co-Founder of eToro, said the company delivered its strongest quarterly financial performance since becoming a public company.“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,” Assia said.He added that the company launched 24/7 trading, expanded access to Japanese equities, and introduced crypto trading in New York during the quarter.Assia also pointed to growth in AI-focused products and the company’s expanding partnership with xAI.“As part of its commitment to AI-powered investing, eToro introduced Agent Portfolios,” the company said, referring to AI-driven portfolio tools integrated with Tori, eToro’s AI agent.Assia further said the acquisition of crypto wallet provider Zengo strengthens eToro’s strategy of connecting traditional finance with on-chain infrastructure and the broader crypto ecosystem.“The acquisition of Zengo, a leading self-custodial crypto wallet provider, meaningfully advances our strategy of bridging traditional finance with on-chain infrastructure, prediction markets, perpetuals and the broader crypto ecosystem,” Assia said.The Zengo acquisition closed on April 30, 2026.Funded accounts and assets riseeToro reported continued growth in customer activity and assets during the quarter.Funded accounts increased 12% year-over-year to 4.02 million, supported by higher marketing spending on customer acquisition and retention.Assets under administration rose 15% to $17 billion, while cash, cash equivalents and short-term investments stood at $1.3 billion as of March 31, 2026.Chief Financial Officer Meron Shani said the results demonstrated the strength of the company’s diversified business model.“Strong first quarter 2026 results supported by a surge in commodities trading, demonstrated the strength of our multi-asset business model,” Shani said.April metrics show continued momentumThe company also released preliminary April business metrics that indicated continued growth momentum.Assets under administration rose 19% year-over-year to $18.7 billion in April, while funded accounts increased 13% to 4.07 million.Total capital markets and equities, commodities and currencies trades reached 63 million during April, up 50% from a year earlier.Meanwhile, crypto trading activity slowed. Total crypto trades declined 32% year-over-year to 2 million, while the invested amount per crypto trade fell 22%.Interest-earning assets increased 28% to $7 billion, while total money transfers climbed 53% to $1.4 billion during April.The post eToro beats Q1 profit estimates as commodities trading surges appeared first on Invezz