eToro Stock Slips After Touching Record Highs As Q1 Profit Falls: Retail’s Split

EToro (ETOR) stock was down in extended trading after falling nearly 12% in the regular session on Tuesday.

It reported a net income of $60 million, or $0.69 per share, for the three months ended March 31, compared with $64 million, or $0.76 per share, a year earlier.

The Israel-based company’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) margin for the first quarter fell to 37% compared with 43%.

The online broker said the earnings decline was due to its increased investment in marketing and growth.

EToro’s funded accounts rose 14% to 3.58 million compared to a year earlier, aided by user acquisition and retention efforts and the acquisition of Australian investing app Spaceship in 2024.

The newly listed company said that eToro launched futures in Europe and options in the UK in the first quarter. Europa and the UK represent 70% of the company’s funded accounts.

Total trades on its platform fell to 128 million from 135 million in the year-ago quarter. However, the company’s interest-earning assets rose to $6.4 billion from $6.2 billion in the previous quarter.

It also launched 40 more digital tokens on its platform, bringing its total number of cryptocurrency offerings to over 130.

“Our results show strong business performance for Q1, with an increase in net contribution driven by increased trading activity and our continued focus on sustainable, profitable growth,” said Meron Shani, eToro CFO.

The stock had surged to a record high earlier in the session, following several analysts’ upgrades before the earnings report.

Retail sentiment on Stocktwits was in the ‘neutral’ (45/100) territory, while retail chatter was ‘normal.’

“Fundamentals looking pretty good, hopefully they can improve profitability,” one trader said.

While some were wondering whether there would be further sell-offs.

EToro stock has gained nearly 29% since its initial public offering.

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