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Virtu Financial Shares Down 3.6% Despite Q2 Earnings Beat
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Key Takeaways
{\"0\":\"VIRT posted Q2 EPS of $1.53, beating estimates and surging 84.3% y/y.\",\"1\":\"Adjusted net trading income rose 47.4% to $567.7M, with both segments outperforming expectations.\",\"2\":\"Total expenses jumped 21.4% y/y due to higher brokerage, payroll and data costs.\"}
Shares of Virtu Financial, Inc. (VIRT - Free Report) have fallen 3.6% since it reported second-quarter 2025 results on July 30. The quarterly results were affected by an elevated expense level. However, the negatives were offset by the improved commissions and technology services revenues. Strong performance in both the Market Making and Execution Services segments, driven by increased trading activity, also contributed to the upside.
Virtu Financial reported second-quarter adjusted earnings per share (EPS) of $1.53, which beat the Zacks Consensus Estimate by 12.5%. The bottom line soared 84.3% year over year.
Adjusted net trading income of $567.7 million advanced 47.4% year over year. The top line surpassed the consensus estimate by 9.4%.
Virtu Financial, Inc. Price, Consensus and EPS Surprise
Revenues from commissions, net and technology services rose 22% year over year to $153.9 million. The metric beat the Zacks Consensus Estimate and our model estimate of $144.1 million. Interest and dividend income of $128.4 million increased 19.9% year over year and beat the consensus mark and our estimate of $109.4 million.
Adjusted EBITDA was $369.4 million, which climbed 69.8% year over year and came higher than our estimate of $234.2 million. Adjusted EBITDA margin improved 860 basis points year over year to 65.1%.
Total operating expenses escalated 21.4% year over year to $652.6 million, higher than our estimate of $584.3 million. The year-over-year increase was due to higher net brokerage, exchange and clearance fees, payments for order flow, communication and data processing costs, employee compensation and payroll taxes, as well as interest and dividends expense.
Q2 Segmental Update
Market Making: Adjusted net trading income was $451.5 million in the second quarter, which climbed 58.1% year over year and topped our estimate of $307.9 million. The unit’s revenues climbed 38.1% year over year to $786.6 million, higher than the Zacks Consensus Estimate and our estimate of $593.3 million.
Execution Services: The unit recorded an adjusted net trading income of $116.3 million in the quarter under review, which advanced 16.8% year over year and surpassed our estimate of $104.6 million. Total revenues of $214.5 million rose 68.8% year over year and beat the consensus mark and our estimate of $133.2 million.
Financial Update (As of June 30, 2025)
Virtu Financial exited the second quarter with cash and cash equivalents of $752.1 million, which tumbled 13.8% from the 2024-end level. Total assets of $19.3 billion increased 25.5% from the figure at 2024-end.
Long-term borrowings, net, amounted to $1.7 billion, which inched up marginally from the figure as of Dec. 31, 2024. Short-term borrowings totaled $251.8 million.
Total equity of $1.6 billion rose 9.8% from the 2024-end level.
Share Repurchase & Dividend Update
Virtu Financial bought back 1.7 million shares worth $66.3 million in the second quarter of 2025. It had a leftover capacity of $302.8 million under its buyback authorization for future purchases.
VIRT announced a cash dividend of 24 cents per share. The dividend will be paid out on Sept. 15, 2025, to its shareholders of record as of Sept. 1.
VIRT’ Zacks Rank & Other Key Picks
VIRT currently flaunts a Zacks Rank #1 (Strong Buy).
The Zacks Consensus Estimate for Lazard’s current-year earnings of $2.47 per share has witnessed two upward revisions in the past 30 days against none in the opposite direction. Lazard beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 43.9%. The consensus estimate for current-year revenues is pegged at $3.1 billion, implying 5.6% year-over-year growth.
The Zacks Consensus Estimate for Evercore’s current-year earnings of $12.41 per share has witnessed two upward revisions in the past 30 days against no movement in the opposite direction. Evercore beat earnings estimates in each of the trailing four quarters, with the average surprise being 44.1%. The consensus estimate for current-year revenues is pegged at $3.5 billion, calling for 15.9% year-over-year growth.
The Zacks Consensus Estimate for Acadian Asset Management’s current-year earnings is pegged at $3.18 per share, implying 15.2% year-over-year growth. In the past 60 days, Acadian Asset Management has witnessed one upward estimate revision against none in the opposite direction. The consensus mark for the current-year revenues is pegged at $560.8 million, calling for 10.9% year-over-year growth.
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Virtu Financial Shares Down 3.6% Despite Q2 Earnings Beat
Key Takeaways
Shares of Virtu Financial, Inc. (VIRT - Free Report) have fallen 3.6% since it reported second-quarter 2025 results on July 30. The quarterly results were affected by an elevated expense level. However, the negatives were offset by the improved commissions and technology services revenues. Strong performance in both the Market Making and Execution Services segments, driven by increased trading activity, also contributed to the upside.
Virtu Financial reported second-quarter adjusted earnings per share (EPS) of $1.53, which beat the Zacks Consensus Estimate by 12.5%. The bottom line soared 84.3% year over year.
Adjusted net trading income of $567.7 million advanced 47.4% year over year. The top line surpassed the consensus estimate by 9.4%.
Virtu Financial, Inc. Price, Consensus and EPS Surprise
Virtu Financial, Inc. price-consensus-eps-surprise-chart | Virtu Financial, Inc. Quote
Virtu Financial’s Q2 Performance Details
Revenues from commissions, net and technology services rose 22% year over year to $153.9 million. The metric beat the Zacks Consensus Estimate and our model estimate of $144.1 million. Interest and dividend income of $128.4 million increased 19.9% year over year and beat the consensus mark and our estimate of $109.4 million.
Adjusted EBITDA was $369.4 million, which climbed 69.8% year over year and came higher than our estimate of $234.2 million. Adjusted EBITDA margin improved 860 basis points year over year to 65.1%.
Total operating expenses escalated 21.4% year over year to $652.6 million, higher than our estimate of $584.3 million. The year-over-year increase was due to higher net brokerage, exchange and clearance fees, payments for order flow, communication and data processing costs, employee compensation and payroll taxes, as well as interest and dividends expense.
Q2 Segmental Update
Market Making: Adjusted net trading income was $451.5 million in the second quarter, which climbed 58.1% year over year and topped our estimate of $307.9 million. The unit’s revenues climbed 38.1% year over year to $786.6 million, higher than the Zacks Consensus Estimate and our estimate of $593.3 million.
Execution Services: The unit recorded an adjusted net trading income of $116.3 million in the quarter under review, which advanced 16.8% year over year and surpassed our estimate of $104.6 million. Total revenues of $214.5 million rose 68.8% year over year and beat the consensus mark and our estimate of $133.2 million.
Financial Update (As of June 30, 2025)
Virtu Financial exited the second quarter with cash and cash equivalents of $752.1 million, which tumbled 13.8% from the 2024-end level. Total assets of $19.3 billion increased 25.5% from the figure at 2024-end.
Long-term borrowings, net, amounted to $1.7 billion, which inched up marginally from the figure as of Dec. 31, 2024. Short-term borrowings totaled $251.8 million.
Total equity of $1.6 billion rose 9.8% from the 2024-end level.
Share Repurchase & Dividend Update
Virtu Financial bought back 1.7 million shares worth $66.3 million in the second quarter of 2025. It had a leftover capacity of $302.8 million under its buyback authorization for future purchases.
VIRT announced a cash dividend of 24 cents per share. The dividend will be paid out on Sept. 15, 2025, to its shareholders of record as of Sept. 1.
VIRT’ Zacks Rank & Other Key Picks
VIRT currently flaunts a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the broader finance space are Lazard, Inc. (LAZ - Free Report) , Evercore Inc (EVR - Free Report) and Acadian Asset Management Inc. (AAMI - Free Report) , each sporting a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Lazard’s current-year earnings of $2.47 per share has witnessed two upward revisions in the past 30 days against none in the opposite direction. Lazard beat earnings estimates in three of the trailing four quarters and missed once, with the average surprise being 43.9%. The consensus estimate for current-year revenues is pegged at $3.1 billion, implying 5.6% year-over-year growth.
The Zacks Consensus Estimate for Evercore’s current-year earnings of $12.41 per share has witnessed two upward revisions in the past 30 days against no movement in the opposite direction. Evercore beat earnings estimates in each of the trailing four quarters, with the average surprise being 44.1%. The consensus estimate for current-year revenues is pegged at $3.5 billion, calling for 15.9% year-over-year growth.
The Zacks Consensus Estimate for Acadian Asset Management’s current-year earnings is pegged at $3.18 per share, implying 15.2% year-over-year growth. In the past 60 days, Acadian Asset Management has witnessed one upward estimate revision against none in the opposite direction. The consensus mark for the current-year revenues is pegged at $560.8 million, calling for 10.9% year-over-year growth.