eToro (NASDAQ: ETOR) adds funded accounts, but quarterly net income drops 74%

Posted by Bonnie Powley on Nov 11th, 2026

What happened

eToro Group Ltd. (NASDAQ: ETOR) reported third-quarter net income of $15 million, down from $57 million a year earlier.

User growth continued through the drop. Funded accounts rose 18% to 4.39 million from 3.73 million a year earlier. Assets under administration were flat at $20.8 billion.

On the same day, eToro said its board authorized buying back up to $250 million of its shares. It also said it agreed to acquire LB Finanzas, a digital investment and payments platform in Argentina.

Key numbers

Metric	Latest	Change	Source
Net income	$15 million	from $57 million, -74%	SEC 6-K, Exhibit 99.1
Net contribution	$186 million	from $215 million, -13%	SEC 6-K, Exhibit 99.1
Adjusted EBITDA (non-GAAP)	$34 million	from $78 million, -56%	SEC 6-K, Exhibit 99.1
Adjusted net income (non-GAAP)	$24 million	from $60 million, -60%	SEC 6-K, Exhibit 99.1
Funded accounts	4.39 million	from 3.73 million, +18%	SEC 6-K, Exhibit 99.1
Share repurchase authorization (cap)	up to $250 million		SEC 6-K, Exhibit 99.1

Where the earnings fell

Net contribution is total revenue less the cost of crypto revenue and margin interest expense. It fell 13% to $186 million from $215 million a year earlier. The release says the decline was driven primarily by decreased crypto trading activity.

Profit measures fell much faster. Adjusted EBITDA dropped 56% to $34 million from $78 million. Adjusted net income dropped 60% to $24 million from $60 million. Both are non-GAAP measures. Diluted earnings per share were $0.14 against $0.53. Adjusted diluted earnings per share were $0.26 against $0.60.

Costs did not fall with contribution. Selling and marketing expense rose to $68.14 million from $47.90 million a year earlier. Research and development rose to $42.11 million from $37.91 million. General, administrative and operating costs fell to $51.09 million from $57.43 million.

Not every line weakened. Capital markets net contribution rose 21% year over year. The release says crypto activity recovered from the prior quarter.

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What October showed

Monthly data point to softer activity heading into the fourth quarter, even as accounts kept growing. Funded accounts were 4.42 million in October, up 18% year over year. Assets under administration were $19.2 billion, down 6%.

Capital markets trades totaled 48.2 million, down 22%. The invested amount per trade was $184, down 49%. Crypto trades fell 62% to 2.0 million, with $228 invested per trade, down 29%.

Interest earning assets were $7.0 billion, down 20%. Total money transfers were $1.1 billion, down 21%.

What the buyback covers

The repurchase authorization is a ceiling, not a commitment to spend. Purchases may be made on the open market, including through Rule 10b5-1 plans, in private deals, in block trades or through an accelerated repurchase program. Timing and size depend on the share price, market conditions, liquidity needs and legal requirements.

eToro says its share price does not fully reflect the company's fundamental value. It also says the program gives flexibility for acquisitions in which its shares could serve as currency.

The cash flow statement shows eToro bought $189.11 million of treasury shares in the first nine months of 2026. Weighted-average diluted shares were 91.94 million in the third quarter, down from 100.40 million a year earlier. Cash, cash equivalents and short-term investments were $1.2 billion at Sept. 30.

Why it matters

OptimistFi has argued that eToro works if its platform keeps attracting and monetizing active traders through cycles, without dilution absorbing the economics. This quarter splits that test. Attraction held up. Monetization weakened.

The buyback speaks to the dilution side of that view, and the lower diluted share count shows eToro has already acted on it. It does not change the trading activity that drives net contribution.

The best argument for patience is that funded accounts grew while assets under administration held flat. The earnings drop may be a crypto-driven dip, not a broken growth engine. October complicates that reading, because assets, trade counts and interest earning assets were all lower year over year. OptimistFi reads the filing as mixed for the case.

What's next

eToro scheduled a video call for 5:30 a.m. PT (8:30 a.m. ET) on Nov. 10 to discuss the results. A slide presentation is at investors.etoro.com.

The next quarterly report is the fuller test. Funded accounts continuing to climb while net contribution stops falling would strengthen the case. Another quarter of falling contribution against rising selling and marketing costs would weaken it. Treasury share purchases and the diluted share count will show how much of the authorization eToro uses.