eToro's Record Year Sends Shares Soaring, But Crypto Cracks Emerge
2026-02-18T13:04:15.194+02:00
Wednesday, 18/02/2026 | 11:04 GMT by Damian Chmiel (https://www.financemagnates.com/author/damianc/)
- Wall Street cheered a record year. The underlying data from the second half tells a more complicated story.
- The company's own January KPIs show crypto trades down 50% YoY, even as management bets heavily on the asset class.
eToro Group(NASDAQ: ETORO (https://www.financemagnates.com/tag/etoro/) ) delivered what Wall Street wanted on Tuesday: a record full year, a buybackexpansion, and a confident pitch about the future. The market rewarded it witha more than 20% surge in the stock, which closed at $33.07, the highest levelin over a month.
Look at the headline numbers and the enthusiasm makes sense. Net contribution for the fullyear rose 10% to $868 million, net income climbed 12% to $216 million, and thecompany ended 2025 with $1.3 billion in cash on the balance sheet.
As FinanceMagnates.comreported when the results landed (https://www.financemagnates.com/fintech/etoro-reports-868m-net-contribution-for-2025-funded-accounts-rise-to-38-million/) , full-year GAAP net income rose 12% to $216 million while the sharebuyback program was increased by $100 million. CEO Yoni Assia called it "adefining year" for the company, pointing to the MayNASDAQ IPO (https://www.financemagnates.com/fintech/etoro-ipo-shares-begin-trading-on-nasdaq-under-etor-symbol/) , accelerating product launches, and expanding global reach asevidence of durable momentum.
But strip away the full-year framing and the picture that emerges is considerably morecomplicated. And the company's own data, including the supplemental KPIdisclosures, tells much of that story.
eToro’s Assets Hit a Wallin the Second Half
The single most striking data point in the entire earnings package is one eToro does notheadline. Assets Under Administration (AUA) fell from $20.8 billion at the endof the third quarter to $18.5 billion at the close of Q4, a decline of $2.3billion, or roughly 11%.
The company's press release frames that as "11% year-over-year growth,"which is technically accurate. It does not mention that AUA was growing 76%year-over-year just one quarter earlier, a period when, as previouslyreported, eToro's Q3 netincome rose 48% annually even as sequential momentum stalled (https://www.financemagnates.com/fintech/etoro-posts-28-annual-gain-in-q3-2025-but-adds-just-100000-users-in-quarter/) .
The AUAtrajectory through 2025 was a clean ramp: $14.8 billion, $17.5 billion, $20.8billion, and then a reversal. Q4 broke that trend decisively, and January hasnot reversed it. Monthly KPI data released alongside Tuesday's results showedAUA essentially flat at $18.4 billion, up just 2% year-over-year. In October2025, the most recent comparable data point, AUA growth was running at 73%year-over-year.
Thatdeceleration from 73% to 2% in a matter of months is the number analystsfollowing this stock closely should be circling.
The Numbers Behind the Headlines
Metric
Q1 2025
Q2 2025
Q3 2025
Q4 2025
FY 2025
Net Contribution ($M)
$217
$210
$215
$227
$868
Net Income GAAP ($M)
$60
$30
$57
$69
$216
Adj. EBITDA ($M)
$80
$72
$78
$87
$317
AUA ($B)
$14.8
$17.5
$20.8
$18.5
$18.5
Funded Accounts (M)
3.58
3.63
3.73
3.81
3.81
Source:eToro Group Ltd. SEC filings (Form 6-K), Q1-Q4 2025
Crypto Contribution Collapses, Q4 Spread Turns Negative
The AUA trend points directly at crypto. In Q4, net trading contribution from cryptofell 72% year-over-year to $26 million, and that number requires carefulreading. Beneath the net figure, gross revenue from crypto assets in Q4 was$3.59 billion against a cost of $3.64 billion, meaning the base spread businessgenerated a net loss of approximately $44 million before derivatives. A $73.8million gain on crypto derivatives pulled the combined crypto line intopositive territory for the quarter, but the underlying spot economics wereunderwater.
For the full year, eToro processed approximately $13 billion in crypto volume andgenerated a net spread of just $43 million, a margin of roughly 0.33%. Thecompany made more from crypto derivatives in 2025 ($124 million) than frombuying and selling crypto itself.
In 2024, those ratios were nearly reversed. This is part of a broader trend that hasweighed on crypto-exposed platforms across the board: as FinanceMagnates.comreported in early February (https://www.financemagnates.com/fintech/robinhood-and-etoro-shares-sink-for-eighth-day-as-bitcoin-price-crashes-to-63500/) , both eToro and Robinhood shares faced extended losing streaks as thecryptocurrency downturn pressured revenue outlooks across firms that derivesignificant income from digital asset trading.
January's numbers confirm the pressure has not eased. Crypto trades on the platformtotaled 4 million for the month, down 50% year-over-year. The average amountinvested per crypto trade fell 34% to $182.
January 2026 KPIs: Two Very Different Stories
Segment
Metric
Jan 2026 Value
YoY Change
Capital Markets
Total Trades
74 million
+55%
Capital Markets
Avg Invested/Trade
$252
+8%
Crypto
Total Trades
4 million
-50%
Crypto
Avg Invested/Trade
$182
-34%
Source:eToro January 2026 Monthly KPI Release
Equities and Gold Pick Upthe Slack
Meanwhile, capital markets trades, equities, commodities, and currencies, surged to 74 million in January, up 55% year-over-year, with the average invested amount up 8%. The platform's non-crypto business is growing fast. Its crypto business is shrinking.
That divergence is not lost on management, and it shapes much of how Assia talks about the business.
"We've seen people write off crypto," he told investors on Tuesday's earnings call. "We've kept building." His broader argument is that eToro's multi-asset model is precisely what allows it to absorb these cycles, and the Q4 data gives him some evidence to work with.
Net trading contribution from equities, commodities, and currencies rose 43% year-over-year to $116 million in the fourth quarter, driven partly by a surge in commodities activity.
This is broadly consistent with a wider shift in retail investor behavior: a recent eToro study found that nearly 8 in 10 retail investors now invest monthly (https://www.financemagnates.com/forex/nearly-8-in-10-retail-investors-invest-monthly-as-genz-leads-the-charge-study-shows/) , with allocations to equities and cash declining as investors seek broader asset exposure.
On the call, Assia described something he called a convergence among the platform's users: crypto-native customers rotating into commodities as volatility shifted asset classes.
Marketing Ramp Signals a Growth Gap
During the earnings call, eToro also revealed its plans to boost sales and marketing spending, and CFO Meron Shani explicitly said it could go higher if ROI supports it.
"We plan to increase from 21%, scaling gradually to 25% of net contribution," Shani said on the call, adding the company expects this to drive "double-digit" funded account growth throughout the year.
That announcement comes after Q4 saw the lowest marketing spend of any quarter in 2025 at $47 million, 21% below the same period a year earlier, while funded account additions in Q4 were also the slowest of the year at just 80,000 net new accounts.
Simultaneously, Assiadisclosed that eToro carried out a headcount reduction roughly a month ago (https://www.financemagnates.com/fintech/exclusive-etoro-to-lay-off-7-of-staff-globally/) , framing it as an AI-efficiency initiative. "AI means we can move 10 times faster," he said on the call. "We're building the eToro super app 100% with AI."
It seems the company is cutting internal costs while ramping external spend to re-accelerate user growth. It is a rational response to a slowing organic environment.
M&A Pipeline Opens Up
Responding to a direct question from UBS analyst Alex Cra, Assia confirmed for the first time that eToro has been in active discussions with acquisition targets since the IPO.
"We do expect to see several M&A deals in 2026," he said. "We have been in active discussions with several target companies over the last six months since the IPO."
He pointed to two areas of focus: the crypto space, both in the US and globally, and the brokerage and wealth management space. The CFO added that eToro has access to both its cash pile and a revolving credit facility to pursue "sizable deals."
Similar plans were already outlined last year in a Bloomberg interview with Ronen Assia (https://www.financemagnates.com/fintech/etoro-co-founder-hints-at-ambitious-ma-possibilities/) , one of eToro's co-founders. The most recent acquisition dates back to 2024, when the company expanded into Australia by taking over the local investing app Spaceship for $55 million (https://www.financemagnates.com/fintech/etoro-acquires-australian-investing-app-spaceship-for-up-to-55-million/) .
The Market Priced the Headline
None of this makes Tuesday's 20% share rally irrational. Full-year records, a strong balance sheet, buyback expansion, a resilient equities business, and an M&A pipeline are genuinely positive signals for a company less than a year into its public life.
Notably, the crypto exchange Gemini, which went public around the same time, simultaneously began pulling back and retreating to its core business, a move eToro has now capitalized on by taking over a portion of its customers (https://www.financemagnates.com/fintech/gemini-accounts-in-the-uk-eu-and-australia-can-be-transferred-to-etoro-ahead-of-closure/) .
The 2024 cohort already shows a 1.88x return on marketing investment; the 2020 cohort has returned 5.6x. These are the numbers of a business with real retention and long-term user value.
But the market priced the headline. The AUA trajectory, the January crypto data, the diluted EPS decline, and the marketing ramp required to sustain growth are the questions that the headline doesn't answer. For investors in ETOR at $33, those are the numbers worth watching in the quarters ahead.
