[First Quarter 2025 Financial and Business Highlights](index=1&type=section&id=First%20Quarter%202025%20Financial%20and%20Business%20Highlights) eToro reported strong Q1 2025 results with an 8% increase in net contribution to $217 million, alongside significant user and AUA growth despite increased marketing investments Q1 2025 Financial Highlights (vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Contribution | $217 million | $201 million | +8% YoY | | Net Income (GAAP) | $60 million | $64 million | -6% YoY | | Adjusted EBITDA | $80 million | $87 million | -8% YoY | | Adjusted EBITDA Margin | 37% | 43% | -6 p.p. | | Funded Accounts | 3.58 million | 3.13 million | +14% YoY | | Assets under Administration | $14.8 billion | $12.2 billion | +21% YoY | | Cash & Equivalents | $736 million | - | - | - The company successfully completed its initial public listing in Q1 2025[3](index=3&type=chunk) - Increased investment in marketing and growth was made in response to favorable market conditions, impacting net income and Adjusted EBITDA[5](index=5&type=chunk)[8](index=8&type=chunk) - eToro is focusing on AI to reshape the investing landscape and accelerate the production of educational materials, now offering over 3,000 pieces of content in 11 languages[3](index=3&type=chunk)[11](index=11&type=chunk) - Key business developments in Q1 2025 include: **Trading** with launched futures in Europe, options in the UK, and expanded crypto offerings to over 130 tokens; **Investing** with added stocks from Abu Dhabi and Hong Kong exchanges and new Smart Portfolios; **Wealth Management** with a new self-directed UK ISA offering and recurring investments; and **Regulatory** achievements including a MiCA permit by CySec for crypto services across the EU and SOC 2 Type II compliance for crypto custody[9](index=9&type=chunk)[11](index=11&type=chunk) [Second Quarter 2025 Update](index=2&type=section&id=Second%20Quarter%202025%20Update) Positive business momentum continued into Q2 2025, with funded accounts reaching 3.61 million and Assets under Administration increasing to $16.9 billion by May 31 Key Metrics as of May 31, 2025 | Metric | Value | | :--- | :--- | | Funded Accounts | 3.61 million | | Assets under Administration | $16.9 billion | - Performance through May 31, 2025, reflects continued interest in trading and investing from retail investors in response to market events[11](index=11&type=chunk) [Financial Statements](index=3&type=section&id=Financial%20Statements) The financial statements for Q1 2025 reflect a solid financial position with total assets growing to $1.26 billion and net cash from operating activities at $89.7 million [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets reached $1.26 billion, driven by increased cash and cash equivalents, with total equity growing to $894.7 million Balance Sheet Highlights | Account | March 31, 2025 (in thousands USD) | December 31, 2024 (in thousands USD) | | :--- | :--- | :--- | | Cash and cash equivalents | $660,060 | $575,395 | | Total Assets | $1,255,724 | $1,191,362 | | Total Liabilities | $361,059 | $358,987 | | Total Equity | $894,665 | $832,375 | [Condensed Consolidated Statements of Profit or Loss](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Profit%20or%20Loss) Q1 2025 total revenue and income increased to $3.76 billion, primarily from cryptoassets, while net income decreased to $60.0 million due to higher marketing expenses Q1 Income Statement Highlights | Account | Q1 2025 (in thousands USD) | Q1 2024 (in thousands USD) | | :--- | :--- | :--- | | Total revenue and income | $3,755,381 | $3,383,520 | | Selling and marketing | $61,222 | $37,342 | | Net income | $59,952 | $64,110 | | Diluted net income per share | $0.69 | $0.76 | [Condensed Consolidated Statements of Cash Flows](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 saw net cash from operating activities increase to $89.7 million, resulting in an $84.7 million rise in cash and cash equivalents, totaling $660.1 million Q1 Cash Flow Summary | Activity | Q1 2025 (in thousands USD) | Q1 2024 (in thousands USD) | | :--- | :--- | :--- | | Net cash provided by operating activities | $89,732 | $50,883 | | Net cash used in investing activities | ($11,579) | ($1,712) | | Net cash used in financing activities | ($867) | ($698) | | **Increase in cash and cash equivalents** | **$84,665** | **$44,894** | | **Cash and cash equivalents at end of period** | **$660,060** | **$433,228** | [Non-GAAP Financial Metrics and Key Performance Indicators](index=6&type=section&id=Non-GAAP%20Financial%20Metrics%20and%20Key%20Performance%20Indicators) This section reconciles GAAP net income to Adjusted EBITDA, which was $80.2 million for Q1 2025, and defines key performance indicators like AUA, Funded Accounts, and Net Contribution [Reconciliation of Non-GAAP Metrics](index=6&type=section&id=Reconciliation%20of%20Non-GAAP%20Metrics) Adjusted EBITDA for Q1 2025 was $80.2 million, a decrease from Q1 2024, with reconciliation from GAAP Net Income including various non-cash and non-recurring adjustments Reconciliation of Net Income to Adjusted EBITDA | Line Item | Q1 2025 (in thousands USD) | Q1 2024 (in thousands USD) | | :--- | :--- | :--- | | **Net income** | **$59,952** | **$64,110** | | Taxes on income | $10,589 | $9,516 | | Share-base payment expense | $4,287 | $8,891 | | Depreciation, amortization, and impairment | $3,010 | $2,590 | | Other adjustments | $3,362 | $1,770 | | **Adjusted EBITDA** | **$80,194** | **$86,877** | [Definitions of Key Performance Indicators](index=7&type=section&id=Definitions%20of%20Key%20Performance%20Indicators) This section defines key business metrics including Assets under Administration (AUA), Funded Accounts, and Net Contribution, which are used to evaluate eToro's performance - **Assets under administration (AUA):** The total fair value of all assets held by users in their accounts, including cash and cryptoassets held in the eToro digital wallet[25](index=25&type=chunk) - **Funded Accounts:** Users who have completed onboarding, deposited funds, executed at least one trade, and maintain a positive account balance[26](index=26&type=chunk) - **Net Contribution:** Total revenue and income, less the cost of revenue from cryptoassets and margin interest expense It is used to evaluate the net contributions of user activity[27](index=27&type=chunk) [Cautionary Note Regarding Forward-Looking Statements](index=8&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This section provides legal disclaimers, cautioning that forward-looking statements are subject to risks and uncertainties, and actual results may differ materially from expectations - Forward-looking statements are based on current expectations and are subject to risks including market volatility, competition, regulatory changes, and other factors detailed in the company's SEC filings[30](index=30&type=chunk) - The company warns that past performance is not indicative of future results and that these statements should not be relied upon as representing the company's views at any subsequent date[31](index=31&type=chunk)

Core Insights - eToro Group Ltd. reported strong financial results for Q1 2025, highlighting an increase in net contribution and a focus on sustainable growth [1][3][4] Financial Highlights - Net contribution rose by 8% year-on-year to $217 million, up from $201 million in Q1 2024, primarily due to increased trading activity [6] - Net income (GAAP) was $60 million, a decrease from $64 million in Q1 2024, attributed to higher marketing and growth investments [6] - Adjusted EBITDA (non-GAAP) was $80 million, down from $87 million in the prior year, with an adjusted EBITDA margin of 37%, compared to 43% in the previous year [6] - Funded accounts increased by 14% year-on-year to 3.58 million, driven by user acquisition and retention efforts [6] - Assets under Administration grew by 21% year-on-year to $14.8 billion, compared to $12.2 billion [6] Business Developments - eToro launched new products and services, including futures in Europe and options in the UK, expanding its range of over 130 cryptoassets [7] - The company introduced a commodities portfolio in partnership with WisdomTree and launched securities lending in Europe [7] - eToro began rolling out crypto to fiat services and partnered with local financial institutions to offer virtual bank accounts [7] - The company achieved a MiCA permit from CySec, allowing it to provide crypto services across the EU, marking a significant regulatory milestone [8] Market Positioning - eToro's CEO emphasized the importance of AI in transforming the investing landscape and the company's commitment to empowering retail investors [2] - The company aims to drive sustainable growth and profitability, creating value for shareholders [2]