StoneX(SNEX) - 2025 Q3 - Quarterly Results

Financial Highlights and Executive Summary Q3 FY2025 Financial Highlights StoneX Group reported a 4% year-over-year increase in quarterly net operating revenues to $488.3 million and a 2% rise in net income to $63.4 million for the third quarter of fiscal 2025. Diluted EPS was $1.22, a slight decrease from the prior year, partly due to $8.9 million in acquisition-related charges Q3 FY2025 Key Financial Metrics | Metric | Q3 FY2025 | Change vs. Q3 FY2024 | | :--- | :--- | :--- | | Net Operating Revenues | $488.3 million | +4% | | Net Income | $63.4 million | +2% | | Diluted EPS | $1.22 | -2% | | Return on Equity (ROE) | 13.1% | -2.6 p.p. | - The quarter's results were impacted by $8.9 million in acquisition-related charges, which reduced diluted EPS by approximately $0.12. These charges included $6.5 million in bridge loan financing fees and $2.4 million in professional fees[2] Executive Commentary and Strategic Developments The Executive Vice-Chairman highlighted the company's diversified business model, where strong growth in the Institutional and Self-Directed/Retail segments offset declines in the Commercial segment caused by lower commodity volatility. The company successfully closed the acquisitions of R.J. O'Brien and The Benchmark Company, LLC post-quarter end, which is expected to significantly enhance its global derivatives and capital markets offerings - The company's diversified business model showed resilience, with strong performance in the Institutional (notably equities) and Self-Directed/Retail segments compensating for weakness in Commercial businesses[2] - On July 31, 2025, the company closed the acquisitions of R.J. O'Brien and The Benchmark Company, LLC[3] - R.J. O'Brien is positioned to make StoneX a market leader in global derivatives, having generated approximately $766 million in revenue and $170 million in EBITDA in calendar 2024[3] - The Benchmark Company, LLC acquisition enhances the capital markets offering with a full-service investment banking firm, expanding the client base and capabilities[3] Consolidated Financial Performance Consolidated Financial Statements Summary For the third quarter of FY2025, total revenues grew 29% YoY to $34.8 billion, driven by a significant increase in sales of physical commodities. Net operating revenues rose 4% to $488.3 million. Net income increased by 2% to $63.4 million, while diluted EPS decreased slightly by 2% to $1.22. For the nine months ended June 30, 2025, net income grew 20% to $220.2 million Consolidated Financial Results (in millions, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $34,828.8 | $27,069.7 | 29% | | Net Operating Revenues | $488.3 | $468.5 | 4% | | Income Before Tax | $85.6 | $88.0 | (3)% | | Net Income | $63.4 | $61.9 | 2% | | Diluted EPS | $1.22 | $1.25 | (2)% | | Metric | Nine Months Ended June 30, 2025 | Nine Months Ended June 30, 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $99,654.8 | $68,748.8 | 45% | | Net Operating Revenues | $1,467.7 | $1,312.4 | 12% | | Income Before Tax | $299.6 | $256.0 | 17% | | Net Income | $220.2 | $184.1 | 20% | | Diluted EPS | $4.32 | $3.76 | 15% | Net Operating Revenues Analysis Consolidated net operating revenues increased 4% YoY to $488.3 million in Q3. This growth was primarily driven by a 46% surge in Securities revenues. However, this was partially offset by significant declines in Physical Contracts (-40%), Listed Derivatives (-13%), and OTC Derivatives (-11%), reflecting reduced commodity market volatility Net Operating Revenues by Product (in millions) | Product | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | Securities | $125.5 | $86.2 | 46% | | FX/CFD contracts | $77.4 | $67.6 | 14% | | Physical contracts | $33.3 | $55.8 | (40)% | | Listed derivatives | $56.9 | $65.3 | (13)% | | OTC derivatives | $58.8 | $66.2 | (11)% | | Interest, net / fees | $73.9 | $86.4 | (14)% | | Total | $488.3 | $468.5 | 4% | Interest Expense Analysis Total interest expense for Q3 FY2025 rose 22% YoY to $391.4 million. The increase was mainly due to a 25% rise in interest expense from trading activities, particularly in fixed income securities and securities borrowing, reflecting growth in those businesses. Corporate funding interest expense included a one-time $6.5 million fee for bridge loan financing related to the R.J. O'Brien acquisition - Interest expense from trading activities increased 25% YoY to $371.3 million, driven by growth in the security repo and securities lending businesses[14] - Corporate funding interest expense for the quarter included $6.5 million in bridge loan financing fees related to the R.J. O'Brien acquisition[15] Expense Structure (Variable vs. Fixed) The company's expense structure remained consistent year-over-year. In Q3 FY2025, total non-interest expenses were $546.0 million, with variable expenses comprising 53% and non-variable expenses making up 47%. This is a similar split to the prior-year quarter Expense Structure Breakdown - Q3 2025 vs Q3 2024 (in millions) | Expense Type | Q3 2025 | % of Total | Q3 2024 | % of Total | | :--- | :--- | :--- | :--- | :--- | | Total variable expenses | $288.5 | 53% | $264.7 | 52% | | Total non-variable expenses | $257.5 | 47% | $241.7 | 48% | | Total non-interest expenses | $546.0 | 100% | $506.4 | 100% | Balance Sheet Summary As of June 30, 2025, StoneX reported total stockholders' equity of $1.98 billion, an increase from $1.71 billion at the end of fiscal year 2024. Key assets such as 'Securities purchased under agreements to resell' and 'Financial instruments owned' saw significant increases. Net asset value per share grew to $40.36 from $35.75 over the same period Key Balance Sheet Items (in millions) | Item | June 30, 2025 | September 30, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,313.1 | $1,269.0 | | Securities purchased under agreements to resell | $8,159.3 | $5,201.5 | | Financial instruments owned, at fair value | $8,973.9 | $6,767.1 | | Securities sold under agreements to repurchase | $13,375.4 | $8,581.3 | | Stockholders' equity | $1,978.8 | $1,709.1 | - Net asset value per share increased to $40.36 as of June 30, 2025, compared to $35.75 as of September 30, 2024[33] Segment Performance Analysis Commercial Segment The Commercial segment experienced a significant downturn in Q3, with segment income falling 36% YoY to $80.2 million. This was driven by a 24% decrease in net operating revenues to $168.3 million, primarily due to lower performance in physical contracts (-44%) and derivatives, reflecting diminished commodity market volatility Commercial Segment Performance (in millions) | Metric | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | Operating Revenues | $225.8 | $262.2 | (14)% | | Net Operating Revenues | $168.3 | $220.5 | (24)% | | Segment Income | $80.2 | $125.7 | (36)% | - Net operating revenues from Physical contracts fell 44% YoY, and Listed Derivatives fell 18% YoY, contributing to the segment's decline[24] Institutional Segment The Institutional segment delivered strong results, with segment income increasing 41% YoY to $87.4 million. This growth was fueled by a 27% rise in net operating revenues to $200.1 million. The standout performer was Securities, where net operating revenues surged 48% YoY, driven by a 25% increase in average daily volume and a 15% rise in rate per million Institutional Segment Performance (in millions) | Metric | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | Operating Revenues | $626.0 | $508.9 | 23% | | Net Operating Revenues | $200.1 | $157.7 | 27% | | Segment Income | $87.4 | $62.2 | 41% | - Securities net operating revenues grew 48% YoY to $119.8 million, supported by a 25% increase in average daily volume[25][27] Self-Directed/Retail Segment The Self-Directed/Retail segment showed robust growth, with segment income jumping 49% YoY to $41.2 million. Net operating revenues increased 18% to $80.6 million, primarily driven by a 17% rise in net operating revenues from FX/CFD contracts, which benefited from a 34% increase in average daily volume Self-Directed/Retail Segment Performance (in millions) | Metric | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | Operating Revenues | $114.2 | $96.2 | 19% | | Net Operating Revenues | $80.6 | $68.5 | 18% | | Segment Income | $41.2 | $27.6 | 49% | - FX/CFD contracts net operating revenues grew 17% to $70.2 million, as average daily volume increased 34% YoY[28] Payments Segment The Payments segment delivered a stable performance in Q3, with segment income remaining flat YoY at $28.1 million. Net operating revenues saw a modest 3% increase to $50.2 million. While the average daily volume of payments increased by 16%, the rate per million (RPM) decreased by 6%, resulting in steady overall results Payments Segment Performance (in millions) | Metric | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | Operating Revenues | $53.3 | $51.1 | 4% | | Net Operating Revenues | $50.2 | $48.7 | 3% | | Segment Income | $28.1 | $28.2 | 0% | - Payments average daily volume (ADV) increased 16% YoY, but this was offset by a 6% decrease in rate per million (RPM)[29] Overhead Costs and Expenses Total overhead costs and expenses increased by 9% YoY to $140.4 million in Q3. The rise was primarily driven by a 7% increase in compensation and benefits and a 12% increase in other expenses. Notably, professional fees rose 38% and non-trading technology support costs increased 19%. After allocating $43.0 million to operating segments, net overhead costs were $97.4 million Overhead Costs Breakdown (in millions) | Expense Category | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | Compensation and benefits | $78.6 | $73.6 | 7% | | Other expenses | $61.8 | $55.2 | 12% | | Total Overhead Costs | $140.4 | $128.8 | 9% | - Significant drivers of the increase in 'Other expenses' were Professional fees (+38%) and Non-trading technology and support (+19%)[31] Other Information Conference Call & Web Cast The company will host a conference call and webcast on Wednesday, August 6, 2025, at 9:00 a.m. Eastern time to discuss the financial results. A live webcast and replay will be available on the company's corporate website - A conference call to discuss financial results is scheduled for August 6, 2025, at 9:00 a.m. Eastern time[34] About StoneX Group Inc. StoneX Group Inc. is a Fortune-500 company financial services company headquartered in New York City. It operates a global network connecting clients to the market ecosystem through digital platforms and expert services. With over 4,700 employees in more than 80 offices, the company serves over 54,000 commercial, institutional, and payments clients, and over 400,000 retail accounts worldwide - StoneX is a Fortune-500 company with over 4,700 employees serving more than 54,000 commercial, institutional, and payments clients, and over 400,000 retail accounts globally[36] Forward-Looking Statements This press release contains forward-looking statements regarding the company's financial condition, business strategy, and the anticipated impact of its recent acquisitions. These statements are based on current expectations and are subject to known and unknown risks and uncertainties, including market conditions, competition, and regulatory changes. The company claims safe harbor protection for these statements under the Private Securities Litigation Reform Act of 1995 - The report includes forward-looking statements concerning financial condition, business strategy, and the impact of acquisitions like R.J. O'Brien[37] - These statements involve risks and uncertainties, and the company cautions readers not to place undue reliance on them, claiming protection under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995[38][39]