Sacra estimates eToro hit $931M in commission revenue in 2024, up 46% from $630M in 2023, following essentially flat performance between 2022 ($631M) and 2023.

eToro's revenue is diversified across multiple streams: 42% from equities, commodities, and currencies combined; 25% from cryptoassets; 20% from net interest; 10% from eToro Money; and <1% from subscriptions. This balanced approach provides resilience during market fluctuations.

The platform's Q4 2024 performance was particularly strong, with commissions reaching $303M, an 82.5% increase compared to Q4 2023, driven by increased crypto trading activity and rising interest income.

eToro's 3.5M funded accounts (up 17% YoY) generate revenue primarily through trading commissions (adding 1% to crypto asset prices), overnight and weekend fees on CFDs, withdrawal fees, currency conversion fees, and interest income on customer deposits.

The company's geographic diversification is notable, with 70% of funded accounts in Europe/UK, 16% in Asia Pacific, 10% in Americas, and 4% in Middle East/Africa.

Net income surged to $192M in 2024, up 1,161% from $15M in 2023, while Adjusted EBITDA reached $304M, a 159% increase from $117M in 2023, demonstrating significant operational leverage.

eToro is valued at $3.5 billion as of March 2023, when the company raised $250 million in private funding. This represents a significant decrease from the $10.4 billion valuation proposed in its terminated 2021 SPAC merger with FinTech Acquisition Corp. V.

The company had previously raised a $100 million Series E round in 2018 that valued it at $800 million. This latest funding comes as eToro potentially prepares for an IPO attempt in 2025, following the abandoned SPAC deal that was terminated in July 2022 due to deteriorating market conditions.

At its current $3.5 billion valuation on $931 million in 2024 revenue, eToro trades at approximately 3.8x revenue multiple, lower than Robinhood's 15x multiple but comparable to Public.com's recent valuation of $600 million on estimated revenue of $120 million (5x multiple).

eToro is a social investment platform that transforms the traditionally solitary activity of trading into a community experience. At its core, the platform allows users to trade multiple asset classes (stocks, ETFs, cryptocurrencies, commodities, currencies, and options) while observing and automatically copying the trading strategies of successful investors.

The platform's signature feature, CopyTrader (launched in 2010), enables users to allocate a portion of their portfolio (minimum $200) to automatically mimic the trades of successful investors in real-time. When a copied trader buys Apple stock, the copier's account automatically executes the same trade proportional to their investment amount. This democratizes access to sophisticated trading strategies, allowing beginners to leverage the expertise of successful traders without needing advanced financial knowledge.

The social element extends beyond copying. Users can browse a Twitter-like feed where investors share market insights, discuss trends, and post about specific assets. For example, a user interested in tech stocks might follow several tech-focused traders, see their recent buys and sells, read their analysis of market trends, and either manually follow their suggestions or automatically copy their portfolios.

For users who want less involvement, eToro offers Smart Portfolios – curated collections of assets built around specific themes (like renewable energy or AI) or strategies, requiring a minimum investment of $500. The platform's multi-asset approach means users can trade fractional shares of U.S. stocks with zero commission, speculate on cryptocurrencies with a 1% spread fee, and in non-U.S. markets, use CFDs to trade on margin or go short (betting against assets).

eToro Money complements the trading platform with a digital wallet and payment card, allowing users to spend and manage funds directly from their eToro account. The Delta acquisition provides portfolio tracking functionality across multiple platforms and exchanges, serving both as a standalone product and an acquisition channel.

While dedicated crypto exchanges offer more advanced features, and traditional brokerages may have more comprehensive research tools, eToro's strength lies in its blend of social features with a simplified multi-asset trading experience accessible to beginners while still offering enough functionality for intermediate investors.

eToro operates a multi-faceted B2C business model centered around monetizing trading activity while creating network effects through its social investing features. Unlike traditional brokerages that historically charged fixed commissions per trade, eToro's primary revenue source (approximately 87%) comes from spread fees – the difference between bid and ask prices on transactions.

The platform applies a 1% spread fee on cryptocurrency transactions and varying spreads on other assets, with revenue recognized differently depending on the financial instrument. For crypto assets, IFRS accounting requires eToro to report the total transaction value ($12.6B in 2024) rather than just its commission, creating an apparent disconnect with competing platforms' reported figures.

Beyond spreads, eToro monetizes through a diversified fee structure: overnight and weekend fees on positions held beyond market hours (particularly relevant for leveraged CFD positions), currency conversion fees ranging from 0.25% to 3%, inactivity fees of $10 monthly for dormant accounts, and $5 withdrawal fees. As interest rates rose, interest income on customer deposits has become an increasingly important revenue component, growing to $50 million in Q4 2024 (20% of total revenue).

eToro's unique competitive advantage stems from its Popular Investor Program, which creates a two-sided marketplace dynamic by paying successful traders up to 1.5% annually of the assets being copied. This incentivizes skilled traders to maintain accounts on the platform, generating a self-reinforcing ecosystem where successful traders attract copiers, who in turn generate more revenue through their trading activity and deposits.

The company's customer segmentation reveals a tiered approach, with "Diamond" tier investors (typically Gen X users around 45 years old with average deposits of $478,000) representing the most profitable segment with significantly lower monthly churn rates (1.5% vs. 2.8% for newer customers). However, only 6.4% of registered users converted to funded accounts in 2021, highlighting a significant drop-off in the conversion funnel.

eToro's business model has evolved from primarily serving high-frequency traders through CFD trading to catering to a broader spectrum of investors. This shift is reflected in the changing composition of commission revenue, with equities (42%) now outpacing crypto (25%), though the company still benefits more from active trading than buy-and-hold strategies due to its fee structure.

Robinhood dominates the US retail trading landscape with 25.2 million funded customers compared to eToro's 3.5 million, representing a significant scale advantage in the world's largest investment market. Robinhood pioneered commission-free stock trading in 2013, forcing incumbents like E*TRADE and Charles Schwab to eliminate their own trading fees.

While Robinhood entered the market with a mobile-first, gamified approach focusing on active traders (45% monthly trading activity), Public.com positioned itself for long-term investors with 70% of users self-identifying as such. Both platforms have since converged somewhat in their offerings – Robinhood expanding into retirement accounts and credit cards while Public launched options trading in January 2024.

The competitive dynamic has shifted from user acquisition at all costs to targeting higher-value customers. Public's newer cohorts are depositing $7,880 (2024) compared to just $800 for 2020/2021 cohorts, while Robinhood's new users start with $6,000-$8,000 in deposits versus $1,000-$2,000 for earlier cohorts. This shift reflects both strategic pivots and broader market conditions as pandemic-era first-time investors have been replaced by more serious investors with larger portfolios.

eToro's late entry to US stock trading (2022) puts it at a significant disadvantage in brand recognition, though its social trading features offer meaningful differentiation in a market where platforms are otherwise struggling to distinguish themselves beyond price.

Coinbase maintains its position as the dominant cryptocurrency exchange in the US with approximately 108 million users as of 2022, dwarfing eToro's crypto user base. Unlike eToro's multi-asset approach, Coinbase focuses exclusively on cryptocurrency trading and related services, generating $3.1 billion in revenue in 2022.

eToro's 1% flat crypto trading fee is higher than most specialized exchanges, creating a disadvantage for high-volume traders. This leads to a "graduation effect" where users often begin their crypto journey on eToro but migrate to specialized exchanges like Binance or Kraken as they gain expertise and seek advanced features such as margin trading, algorithmic tools, and lower fees.

The value proposition for crypto users on eToro centers on its social trading features and multi-asset integration rather than technical sophistication. The CopyTrader functionality allows novice investors to automatically mirror successful crypto traders, while the platform's simplified interface eliminates the need to understand crypto wallets and blockchain mechanics that dedicated exchanges often require.

Robinhood's acquisition of cryptocurrency exchange Bitstamp for $200 million in July 2024 (a fraction of Bitstamp's prior $4 billion valuation) demonstrates the ongoing convergence in this space, as trading platforms expand their crypto capabilities while specialized exchanges broaden their offerings to include traditional assets.

Traditional brokerages like Charles Schwab and Fidelity have effectively countered commission-free insurgents by matching zero-commission trading while leveraging their substantially larger balance sheets. Schwab holds approximately $8.8 trillion in client assets compared to Robinhood's $118 billion, providing enormous advantages in both interest revenue and cross-selling opportunities.

These incumbents have successfully retained their higher-value customers while losing primarily lower-balance accounts to mobile-first platforms, resulting in minimal impact to their economics despite the loss of commission revenue. Their comprehensive product suites, extensive research tools, and established reputations create significant barriers for newer entrants like eToro.

In the forex and CFD space, FOREX.com competes directly with eToro in multiple international markets. As a veteran platform focusing on currency trading and CFDs with a presence in 180 countries, FOREX.com started with currency trading and expanded to other assets but targets more professional traders than eToro's primarily retail audience.

eToro's international footprint (operating in 74 countries) represents both a competitive advantage and challenge. While this geographic diversification reduces dependency on any single market, it also requires navigating complex regulatory environments across multiple jurisdictions, creating operational complexity that US-focused competitors don't face.

eToro's strong European presence (70% of funded accounts) positions it to capitalize on significant growth potential in a market where retail investment penetration stands at only 7% compared to 58% in the US. With 22 million new brokerage accounts forecast for Europe by 2028, eToro's established regional brand and regulatory approvals provide structural advantages over US-centric competitors.

The planned activation of eToro's Singapore license in 2025 represents a strategic entry point into the high-growth Asia-Pacific region, where the company already has 16% of its funded accounts. This expansion coincides with Robinhood establishing its Asia-Pacific headquarters in Singapore, setting up a potential competitive clash in this key growth market.

The Middle East presents another expansion vector, with eToro's existing 4% market share providing a foundation for growth in a region seeing increasing interest in digital investment platforms. eToro's experience navigating diverse regulatory environments puts it at an advantage compared to US-focused platforms with less international exposure.

Regulatory complexity remains the primary barrier to global expansion for US-based platforms, with each new market requiring different compliance infrastructure and localized product offerings. eToro's early international focus has created valuable organizational knowledge around regulatory navigation that would be difficult and time-consuming for competitors to replicate.

eToro's planned launch of options trading for non-US users in 2025 represents a significant opportunity to increase revenue per user by tapping into a historically high-margin product category. Robinhood's success with options (generating 33% of transaction revenue from this segment) demonstrates the substantial revenue potential of this expansion.

The development of AI-driven investment products, including the recently launched InvestorAI-US Smart Portfolio, positions eToro at the intersection of social investing and algorithmic decision-making. This product utilizes deep learning and pattern recognition rather than traditional valuation methods to identify investment opportunities, potentially creating a new category of investment products.

eToro Money's growth to contributing 10% of total revenue by Q4 2024 validates the company's strategy of expanding beyond pure trading into adjacent financial services. The integration of banking features with investment capabilities moves eToro closer to becoming a comprehensive financial super-app, increasing wallet share from existing users.

The expansion of eToro's BlackRock partnership that launched five core portfolios creates opportunities to attract more long-term investors to the platform. This collaboration with the world's largest asset manager adds institutional credibility to eToro's investment offerings while broadening their appeal beyond active traders.

The anticipated transfer of $68 trillion from baby boomers to millennials by 2030 represents a massive potential influx of capital that could flow into digital investment platforms. eToro's user-friendly interface and social features position it well to capture a portion of this generational wealth transfer, particularly as millennials enter their peak earning and investment years.

The growing popularity of financial influencers aligns perfectly with eToro's Popular Investor program, which allows influencers to monetize their following directly on the platform. As more individuals build audiences around investing content, eToro offers monetization options beyond traditional advertising or subscription models, potentially attracting influential traders to the platform.

The Twitter (now X) integration represents a significant channel for user acquisition, leveraging Twitter's "Fintwit" community which generates 4.7 million financial searches daily. This partnership allows users to access stock information and trading capabilities directly through Twitter's platform, expanding eToro's reach to a community already engaged in financial discussions.

eToro's focus on educational resources and community support addresses a key barrier to entry for new investors. By positioning itself as a learning platform as much as a trading platform, eToro can attract beginners who might be intimidated by more technical interfaces, creating a pipeline of users who may increase their trading activity and deposits as they gain confidence.

Revenue volatility exposure: eToro's financial performance has historically shown high sensitivity to market conditions, particularly in the cryptocurrency segment. Between 2018 and 2019, the company's EBITDA dropped precipitously from $193 million to $11 million, demonstrating vulnerability to market downturns that could recur if crypto activity decreases or interest rates fall substantially.

US market penetration challenges: Despite significant investment, eToro faces entrenched competition in the critical US market where it entered stock trading in 2022, years behind Robinhood and other competitors who have already established strong brand recognition among retail investors. The company's funded accounts (3.5 million) significantly trail Robinhood's (25.2 million), and its Americas segment represents just 10% of users despite the US being the world's largest retail investment market.

Regulatory complexity overhead: Operating across 74 countries exposes eToro to a complex patchwork of regulatory requirements that create compliance costs and business model constraints. Recent SEC findings regarding broker-dealer recordkeeping, customer account maintenance, and net capital requirements highlight ongoing regulatory challenges, while eToro's Russian shareholder Sberbank, now under sanctions, creates additional compliance complications as Sberbank cannot exercise voting rights, sell shares, receive dividends, or receive new shares.