Trading platform eToro's CEO highlights retail investor surge as profit beats estimates
Markets saw sharp swings after U.S. President Donald Trump announced new tariffs early in the quarter, yet analysts observed that individual investors were not deterred by the volatility and quickly sought opportunities to "buy the dip."
"We saw a lot of our retail investors jumping in to scoop opportunities with Google, Nvidia and Tesla," eToro CEO Yoni Assia said in an interview with Reuters, referring to the sharp slide in high-growth big tech stocks following April's tariff announcements.
"This reminds us of what we've seen in COVID, where institutional investors are pulling out of the markets and retail investors are taking that opportunity and investing."
Trading in stocks has since normalized, executives said, sending the company's shares down 8%. Analysts said the stock's slide reflected high expectations ahead of the results.
The company went public in May in a bumper U.S. initial public offering, with shares surging on their debut after pricing above the marketed range.
"Today's initial eToro excitement gave way to a touch of disappointment," said Michael Ashley Schulman, partner and CIO at Running Point Capital Advisors.
"Management admitted the April tariff‑shock uptick in trading activity faded by July, so the beat didn't come with a sustainably higher run‑rate."
Financial technology companies have been expanding their crypto product portfolios as regulatory clarity emerges in the key U.S. market under the Trump administration.
EToro said crypto activity strengthened in July as bitcoin reached all-time highs, propelling several other tokens.
New-age fintech platforms have taken market share from established Wall Street firms by luring younger, tech-savvy investors.
"Regulators all around the world are also looking at what regulators in the U.S. are doing and saying," Assia said. "They're providing very sort of clear messaging, which is, crypto is here to stay."
He added that the company will eventually cater to more sophisticated users as its product expansion, including AI strategies, gathers pace, moving beyond its core retail trading roots.
Founded in 2007, eToro operates a trading platform that allows users to invest in stocks, cryptocurrencies and other assets while mirroring the strategies of top investors.
eToro posted an adjusted profit of 56 cents per share in the three months ended June 30, beating estimates of 50 cents, according to estimates compiled by LSEG.
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