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IG Group Holdings released a trading update forecasting total revenue of approximately £240 million for the third quarter ending 30 September 2026, marking a 14% decline compared to £280.1 million in the same period last year. Net trading revenue is projected to hit £210 million, down from £249.5 million. The group attributed this slowdown to reduced revenue retention in over-the-counter (OTC) derivatives amid challenging market conditions. Retention fell to 70% during the quarter, compared to a recent historical average of 80% since structural market-making optimizations were introduced in late 2025.
Despite the temporary dip in quarterly performance, customer onboarding metrics remained solid. Organic active customers rose by 17%, and organic first-time trades jumped over 25%. On the subsidiary front, Underdog, the group's prediction markets business, posted strong results with net revenue exceeding $105 million, a 100% year-on-year increase. IG expects full-year 2026 revenue to grow in the mid-single-digit percentage range, supported by expected structural gains from its ongoing operational initiatives and the pending $1.3 billion acquisition of Underdog.
For financial sector investors, IG's update highlights how market volatility and reduced client trading margins can impact broker profit margins in the short term. Non-recurring costs related to corporate restructuring and redomiciling to Jersey are expected to total around £30 million for 2026. Excluding these charges, EBITDA margins remain strong in the low-40% range, showing resilience in underlying operations despite tough broader industry dynamics.
