Insiders ranked by realized 90-day signed return on their open-market trades at Stonex Group Inc.. Minimum 3 scored trades. Returns are signed - a sale followed by a rally counts against the insider.
Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K. This filing is 0.00pp more bullish than last year's.
Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.
Tone shift by section
The two components the gauge averages: how Risk Factors and MD&A each shifted in net tone versus last year's 10-K. The headline above is their average, so a green needle over a soft section just means the other section carried it.
Risk Factors
-0.05pp
Flat
Net-tone change vs last year's 10-K.
MD&A
+0.06pp
Flat
Net-tone change vs last year's 10-K.
Per-snippet highlights
Sentence-level sentiment highlighting with category and subcategory filters is coming once the snippet-scoring pipeline lands. For now, dig into the actual section text on the Sections tab.
Language change vs prior 10-K
Risk Factors (Item 1A) - words with the biggest YoY frequency increase
Negative rising
lapses+4
adversely+3
deficiencies+3
weakness+3
adverse+1
Positive rising
effective+2
profitability+1
strong+1
Risk Factors (Item 1A)
10,751 words
Item 1A. Risk Factors
We face a variety of risks that could adversely impact our financial condition and results of operations, set forth below.
Macroeconomic Risks
Our ability to achieve consistent profitability is subject to uncertainty due to the nature of our businesses and the markets in which we operate. Our revenues and operating results may fluctuate significantly because of the following factors:
• market conditions, such as price levels and volatility in the commodities, securities and foreign exchange markets in which we operate;
• changes in the volume of our market-making and trading activities;
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• changes in the value of our financial instruments, currency and commodities positions and our ability to manage related risks; and
• the level and volatility of interest rates.
There have been significant declines in trading volumes in the financial markets generally in the past and there may be similar declines in trading volumes generally or across our platforms in particular in the future. Any one or more of the above factors may contribute to reduced trading volumes. Our revenues and are likely to significantly during periods of economic conditions or decreased trading volume in the U.S. and global financial markets.
Language change vs prior 10-K
MD&A (Item 7) - words with the biggest YoY frequency increase
Negative rising
closing+5
failure+3
bridge+3
limitations+3
arrears+2
Positive rising
leading+3
strong+2
benefit+1
enables+1
strengthens+1
MD&A (Item 7)
21,634 words
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Throughout this discussion, unless the context otherwise requires, the terms “Company”, “we”, “us” and “our” refer to StoneX Group Inc. and its consolidated subsidiaries.
The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this report. This Annual Report on Form 10-K contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” and similar expressions are intended to identify forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties, many of which are beyond the control of the Company, including statements about the benefits of our acquisition of RJO, expected synergies and future financial and operating results, the plans, objectives, expectations and intentions of StoneX after the acquisition, adverse changes in economic, political and market conditions, including losses from our market-making and trading activities arising from counterparty failures, global trade policies and tariffs, the loss of key personnel, the impact of increasing competition, the impact of changes in government regulation, uncertainty concerning fiscal or monetary policies established by central banks and financial regulators, the possibility of liabilities arising from of foreign, United States (“U.S.”) federal and U.S. state securities laws, the impact of changes in technology in the securities and commodities trading industries, and other risks discussed in our filings with the SEC, including Part I, Item A of this Annual Report on Form 10-K for the year ended September 30, 2025. Although we believe that our forward-looking statements are based upon reasonable assumptions regarding our business and future market conditions, there can be no assurances that our actual results will not differ materially from any results expressed or implied by our forward-looking statements. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. We readers that any forward-looking statements are not guarantees of future performance.
Although we continue our efforts to diversify the sources of our revenues, it is likely that our revenues and operating results will continue to fluctuate substantially in the future and such fluctuations could result in losses. These losses could have a material adverse effect on our business, financial condition and operating results.
Our net operating revenues may decrease due to changes in client trading volumes which are dependent in large part on commodity prices and commodity price volatility. Our clients’ trading volumes are largely driven by the degree of volatility—the magnitude and frequency of fluctuations—in prices of commodities. Higher volatility increases the need to hedge contractual price risk and creates opportunities for arbitrage trading. Energy and agricultural commodities markets periodically experience significant price volatility. In addition to price volatility, increases in commodity prices generally lead to increased trading volume. As prices of commodities rise, especially energy prices, new participants enter the markets to address their growing risk-management needs or to take advantage of greater trading opportunities. Sustained periods of stability in the prices of commodities or generally lower prices could result in lower trading volumes and, potentially, lower revenues. In addition, lower volatility and lower volumes could lead to lower client balances held on deposit, which in turn may reduce the amount of interest revenue and account fees we collect based on these deposits.
Factors that are particularly likely to affect price volatility and price levels of commodities include supply and demand of commodities, weather conditions affecting certain commodities, national and international economic and geopolitical conditions, including the war in Ukraine, the Israel-Hamas war and rising tensions in the Middle East, the perceived stability of commodities and financial markets, the level and volatility of interest rates and inflation and the financial strength of market participants.
Low short-term interest rates negatively impact our profitability. We earn interest and fee income on client balances left on deposit with us. We have generated significant interest-related revenue in both the current and prior periods and a decline in short-term interest rates or a decline in the amount of client funds on deposit may have a material adverse effect on our profitability in the future.
Short-term interest rates are highly sensitive to factors that are beyond our control and we can provide no assurance as to whether short-term interest rates will decline in the future.
Our financial position and results of operations may be adversely affected by unfavorable economic and financial market conditions as well as catastrophic events and crises such as pandemics, armed conflicts, wars and geopolitical tensions.
Economic and financial market conditions, including conditions impacted by public health emergencies, such as the COVID-19 pandemic, and geopolitical events such as terrorism and related sanctions imposed by the U.S. Department of Treasury and other governing bodies in countries in which we conduct business, have created significant market volatility, uncertainty and economic disruption. While increased volatility is typically a driver of increased client activity and growth in our operating revenues, longer periods of extreme volatility and dislocation in global securities, foreign exchange and commodity markets may affect our ability to establish effective offsetting positions in our principal trading and market-making activities which may expose us to trading losses. In addition, in the event that a global recession or slowdown occurs, this could lead to extended periods of low short-term interest rates and decreased volatility which could adversely affect our profitability. We also may be exposed to increased counterparty default, liquidity and credit risks with respect to our client accounts, which means if our clients experience losses in excess of the funds they have deposited with us, we may not be able to recover the negative client equity from our clients. In these circumstances, we may nonetheless be required to fund positions with counterparties using our own funds, which in turn would reduce our liquidity buffers. If any of these risks materialize, our operating results or ability to conduct our business may be materially adversely affected.
In addition, the COVID-19 pandemic led to increased operational and cybersecurity risks and the pandemic, or other public health emergencies, may again do so in the future. These risks have included, among others, increased demand on our information technology resources and systems and the increased risk of phishing and other cybersecurity attacks. In the event of a significant COVID-19 resurgence or other public health emergency, any failure to effectively manage these increased operational and cybersecurity demands and risks may materially adversely affect our results of operations and the ability to conduct our business. For a further discussion of cybersecurity risks, see Technology and Cybersecurity Risks below.
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To the extent that our business, financial condition, liquidity or results of operations are adversely affected by catastrophic events and crises, including public health emergencies and armed conflicts, these events may also have the effect of heightening many of the other risks described herein and in any future filings we make with the SEC.
Business Risks
We face risks associated with our market-making and trading activities. A significant portion of our operating revenues are generated through our market making and trading activities. The success of our market-making and trading activities principally depends on:
• the price volatility of specific financial instruments, currencies and commodities;
• our ability to attract order flow and our competitiveness;
• the skill of our personnel, including the efficiency of our order execution, quality of our client service and the sophistication of our trading technology;
• the availability of sufficient capital, in order to provide enhanced liquidity to our clients; and
• general market conditions.
We conduct our market-making and trading activities predominantly as a principal and therefore hold positions that bear the risk of significant price fluctuations, rapid changes in the liquidity of markets, deterioration in the creditworthiness of our counterparties and other risks that may cause the value of our positions to decline, which would lead to lower operating revenues.
In addition, as a market maker, while we seek to hedge our exposure to market risk relating to the positions we hold, at any given moment, our unhedged exposure subjects us to market risk, including the risk of significant losses. Principal gains and losses resulting from our positions could have a disproportionate effect, positive or negative, on our financial condition and results of operations for any particular reporting period. These risks are increased when we have concentrated positions in securities of a single issuer or issuers in specific countries and markets, which is the case from time-to-time.
Declines in the volume of securities, commodities and derivative transactions and in market liquidity generally may result in lower revenues from market-making and trading activities. Changes in price levels of securities and commodities and other assets, and in interest and foreign exchange rates also may result in reduced trading activity and reduce our revenues from market-making transactions. Changes in price levels also may result in losses in the fair value of securities, commodities and other assets held in inventory. Sudden sharp changes in the fair value of securities, commodities and other assets can result in a number of adverse consequences for our business, including illiquid markets, fair value losses arising from positions held by us, and the failure of buyers and sellers of securities, commodities and other assets to fulfill their settlement obligations. Any change in market volume, price, liquidity or any other of these factors could have a material adverse effect on our business, financial condition and operating results.
We operate as a principal in the OTC derivatives markets which involves significant risks associated with commodity derivative instruments in which we transact. We offer OTC derivatives to our clients in which we act as a principal counterparty. We endeavor to simultaneously offset the underlying risk of the instruments, such as commodity price risk, by establishing corresponding offsetting positions with commodity counterparties, or alternatively we may offset those transactions with similar but not identical positions on an exchange. To the extent that we are unable to simultaneously offset an open OTC derivative position or the offsetting transaction is not effective to fully eliminate the derivative risk, we have market risk exposure on these unmatched transactions. Our exposure varies based on the size of our overall positions, the terms and liquidity of the instruments we offer to our clients and the amount of time the positions remain open.
While we mitigate market risk on OTC derivative positions with strict risk limits, limited holding periods and active risk management, adverse movements in the referenced assets or rates underlying these positions or a downturn or disruption in the markets for these positions could result in a substantial loss. In addition, any principal gains and losses resulting from these positions could have a disproportionate effect, positive or negative, on our financial condition and results of operations for any particular reporting period.
Transactions involving OTC derivative contracts may be adversely affected by fluctuations in the level, volatility, correlation or relationship between market prices, rates, indices and/or other factors. These types of instruments may also suffer from illiquidity in the market or in a related market.
OTC derivative transactions are subject to unique risks. OTC derivative transactions are subject to the risk that, as a result of mismatches or delays in the timing of cash flows due from or to counterparties in OTC derivative transactions or related hedging, trading, collateral or other transactions, we or our counterparty may not have adequate cash available to fund our or its current obligations.
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We could incur material losses pursuant to OTC derivative transactions because of inadequacies in or failures of our internal systems and controls for monitoring and quantifying the risk and contractual obligations associated with OTC derivative transactions and related transactions or for detecting human error, systems failure or management failure.
OTC derivative transactions may generally be modified or terminated only by mutual consent of the parties to any such transaction (other than in certain limited default and other specified situations (e.g., market disruption events)) and subject to agreement on individually negotiated terms. Accordingly, it may not be possible to modify, terminate or offset obligations or exposure to the risk associated with a transaction prior to its scheduled termination date.
In addition, we note that as a result of rules adopted by U.S. and foreign regulators concerning certain financial contracts, including OTC derivatives, entered into with our counterparties that have been designated as global systemically important banking organizations, we may be restricted in our ability to terminate such contracts following the occurrence of certain insolvency-related default events. Transactions with these counterparties, therefore, carry heightened risk in the event that the counterparty defaults on its obligations to us.
We are subject to margin funding requirements on short notice. Our business involves establishment and carrying of substantial open positions for clients on futures exchanges and in the OTC derivatives markets. We are required to post and maintain margin or credit support for these positions. Although we collect margin or other deposits from our clients for these positions, significant adverse price movements can occur which will require us to post margin or other deposits on short notice, regardless of whether we are able to collect additional margin or credit support from our clients. We maintain borrowing facilities for the purpose of funding margin and credit support and have in place procedures for collecting margin and other deposits from clients on a same-day basis; however, there can be no assurance that these facilities and procedures will provide us with sufficient funds to satisfy funds to satisfy any additional margin or credit support we may be required to post in the event of severeadverse price movements affecting the open positions of our clients. Generally, if a client is unable to meet its margin call, we promptly liquidate the client’s account. However, there can be no assurance that in each case the liquidation of the account will not result in a loss to us or that liquidation will be feasible, given market conditions, size of the account and tenor of the positions.
We are exposed to counterparty credit risk whereby the failure by persons with whom we do business to meet their financial obligations could adversely affect our business, financial condition and results of operations. We are exposed to the risk that our counterparties fail to meet their obligations to us or to other parties, resulting in significant financial loss to us. These risks include:
• failure by our clients and counterparties to fulfill contractual obligations and honor commitments to us;
• failure by clients to deposit additional collateral for their margin loans during periods of significant price declines;
• failure by our clients to meet their margin obligations;
• failure by our hedge counterparties to meet their obligations to us;
• failure by our clearing brokers and banks to adequately discharge their obligations on a timely basis or remain solvent; and
• default by clearing members in the clearing houses in the U.S. and abroad of which we are members which could cause us to absorb shortfalls pro rata with other clearing members.
These and similar events could materially affect our business, financial condition and results of operations. While we have policies, procedures and automated controls in place to identify and manage our credit risk, there can be no assurance that they will effectively mitigate our credit risk exposure. If our policies, procedures and automated controls fail, our business, financial condition and results of operations may be adversely affected.
We are subject to risk of default by financial institutions that hold our funds and our clients’ funds. We have significant deposits of our own funds and our clients' funds with banks and other financial institutions, including liquidity providers. Although we did not have any material deposits with any of the banks affected by the banking crisis (such as the closure of Silicon Valley Bank, receiverships of First Republic Bank and Signature Bank, and acquisition of Credit Suisse Group AG), we could experience losses on our holdings of cash and investments due to failures of other financial institutions and other parties. If other banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, we might not be able to fully recover the assets we have deposited, or deposited on our customers’ behalf, since in certain cases, we will be among the institution’s unsecured creditors. As a result, our business, financial condition and results of operations could be materially adversely affected by the loss of these funds.
We rely on relationships with introducing brokers for obtaining some of our clients and our business or reputation could be harmed by such introducing broker misconduct or errors. We have relationships with introducing brokers, both domestic and international, who solicit clients for their execution and/or advisory services. Those introducing brokers work to establish execution and/or clearing accounts with our entities for those new client relationships but generally serve as the primary
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relationship and customer service point for those clients. Many of our relationships with introducing brokers are non-exclusive or may be canceled on relatively short notice. In addition, our introducing brokers have no obligation to provide new client relationships or minimum levels of transaction volume. To the extent any of our competitors offers more attractive compensation terms to one or more of our introducing brokers, we could lose the brokers’ services or be required to increase the compensation we pay to retain the brokers. Further, we may agree to set the compensation for one or more introducing brokers at a level where, based on the transaction volume generated by clients directed to us by such brokers, it would have been more economically attractive to seek to acquire the clients directly rather than through the introducing broker. Our failure to maintain our relationships with these introducing brokers or the failure of these introducing brokers to establish and maintain client relationships could result in a loss of revenues, which would adversely affect our business.
We may be held responsible by regulators or third-party plaintiffs for any improper conduct by our introducing brokers, even though we do not control their activities. This may be the case even when the introducing brokers are separately regulated. Many of our introducing brokers operate websites, which they use to advertise our services or direct clients to us and there may be statements on such websites in relation to our services that may not be accurate and may not comply with applicable rules and regulations. Any disciplinary action taken against us relating to the activities of our introducing brokers, or directly against any of our introducing brokers could have a material adverse effect on our reputation, damage our brand name and adversely affect our business, financial condition and operating results.
Products linked to cryptocurrencies could expose us to technology, regulatory and financial risks. We offer derivative products linked to Bitcoin and other cryptocurrencies in certain jurisdictions, and may expand the types of these products offered, the associated types of cryptocurrencies and the jurisdictions in which the products are offered. The distributed ledger technology underlying cryptocurrencies and other similar financial assets is evolving at a rapid pace and may be vulnerable to cyberattacks or have other inherent weaknesses that are not yet apparent. We may be, or may become, exposed to risks related to cryptocurrencies or other financial products that rely on distributed ledger technology through our facilitation of clients’ activities involving such financial products linked to distributed ledger technology.
There is currently no broadly accepted regulatory framework for Bitcoin or other cryptocurrencies, and the regulation of cryptocurrencies is developing and changing rapidly in the U.S. and other countries around the world. For example, in the U.S., it is unclear whether many cryptocurrencies are “securities” under federal securities laws, and the implications for us if any of our products linked to cryptocurrencies are determined to be securities could be significant and adverse. In addition, some market observers have asserted that historical material price fluctuations in many cryptocurrency markets, such as that for Bitcoin, may indicate the propensity for cryptocurrency markets to “bubble,” and if markets for any cryptocurrencies linked to our products suffersevere fluctuations, our clients could experience significant losses and we could lose their business.
The manner in which we account for certain of our precious metals and energy commodities inventory may increase the volatility of our reported earnings. Our net income is subject to volatility due to the manner in which we report our precious metals and energy commodities inventory held by subsidiaries that are not broker-dealers. Our precious metals and energy inventory held in subsidiaries which are not broker-dealers is stated at the lower of cost or net realizable value. We generally mitigate the price risk associated with our commodities inventory through the use of derivatives. We do not elect hedge accounting under U.S. GAAP for this price risk mitigation. In such situations, any unrealized gains in our precious metals and energy inventory in our non-broker-dealer subsidiaries are not recognized under U.S. GAAP, but unrealized gains and losses in related derivative positions are recognized under U.S. GAAP. As a result, our reported earnings from these business segments are subject to greatervolatility than the earnings from our other business segments.
Our risk management policies and procedures may leave us exposed to unidentified or unanticipated risk, which could harm our business. Our risk management policies and procedures may not be fully effective in mitigating our risk exposure in all market environments or against all types of risk, including risks that are unidentified or unanticipated. Our risk management policies and procedures require, among other things, that we record and monitor thousands of transactions each day and we face the significant risk that we are not able to appropriately manage the risk associated with the large volume of transactions.
Our risk management policies and procedures rely on a combination of technology and human controls and supervision that are subject to error and failure. Some of our methods for managing risk are discretionary by nature and are based on internally developed controls and observed historical market behavior, and also involve reliance on standard industry practices. These methods may not adequately prevent losses, particularly as they relate to extreme market movements, which may be significantly greater than historical fluctuations in the market. In addition, our risk management policies and procedures also may not adequately prevent losses due to technical errors if our testing and quality control practices are not effective in preventing software or hardware failures. To the extent that we elect to adjust our risk management policies and procedures to allow for an increase in risk tolerance, we will be exposed to the risk of greaterlosses. Even if our risk management procedures are effective in mitigating known risks, new unanticipated risks may arise and we may not be protected against significant financial loss stemming from these unanticipated risks. These new risks may emerge if, among other reasons, regulators adopt new interpretations of existing laws, new laws are adopted or third-parties initiate litigationagainst us based on new, novel or
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unanticipated legal theories. Our risk management policies and procedures may not prevent us from experiencing a material adverse effect on our financial condition and results of operations and cash flows.
Technology and Cybersecurity Risks
Our revenues, operational costs, regulatory compliance and client satisfaction could be adversely affected by the failure of a vendor or other third party to continue providing services to us. We rely on vendors and other third-parties to provide us with services that are essential to our ability to provide clients with our products and services. These services range from core infrastructure, such as utilities, communications and web hosting services, to systems that allow us to execute and process transactions entered into by our clients.
If these vendors or other third-parties suffer operations issues, including as a result of cyber attacks, and they are unable to continue to provide these services to us, we may be exposed to a variety of risks, including loss of revenue if our clients cannot trade with us, increased costs if we are required to employ alternative solutions and reputational harm.
In addition, some of our vendors hold sensitive information on our behalf, including personally identifiable information relating to our clients. If this data were to be compromised, either as a result of a cyber attack or otherwise, we could be in breach of our obligations to our clients, as well as applicable data protections laws, which could materially adversely affect our results of operations and reputation.
Cyber attacks directed at our vendors may also make us more vulnerable to being targeted for cyber attacks ourselves if the bad actors are able to obtain information relating to our company and / or systems.
If one of our vendors experiences a cyberbreach of its own systems or has data that it holds misappropriated, we could be exposed to a number of additional risks, including:
• heightened risk that we will not be able to comply with applicable regulatory requirements;
• increased risk that external parties will be able to execute fraudulent transactions using our systems;
• losses from fraudulent transactions, as well as potential liability for lossessuffered by our clients;
• increased operational costs to remediate the consequences of the external party’s security breach; and
• reputational harm arising from the perception that our systems may not be secure.
In some cases, operational issues or security breaches affecting our vendors may require us to take steps to protect the integrity of our own operational systems or to safeguard confidential information that we hold, including restricting the ability of our clients to trade or have access to their accounts. These actions could potentially diminish customer satisfaction and confidence in us, materially adversely affecting our results of operations.
Furthermore, the widespread and expanding interconnectivity among financial institutions, clearing banks, CCPs, payment processors, financial technology companies, securities exchanges, clearing houses and other financial market infrastructures increases the risk that the disruption of an operational system involving one institution or entity, including those due to a cyber attack, may cause industry-wide operational disruptions that could materially affect our ability to conduct business.
Internal or third-party computer and communications systems failures, capacity constraints and breaches of security could increase our operating costs and/or credit losses, decrease net operating revenues and cause us to lose clients. We are heavily dependent on the capacity and reliability of the computer and communications systems supporting our operations, whether owned and operated internally or by vendors or third parties, including those used for execution and clearance of our clients’ trades and our market-making activities. We receive and process a large portion of our trade orders through electronic means, such as through public and private communications networks. These computer and communications systems and networks are subject to performance degradation or failure due to any number of reasons, including loss of power, acts of war or terrorism, human error, natural disasters, fire, sabotage, hardware or software malfunctions or defects, computer viruses, cyber attacks, intentional acts of vandalism, client error or misuse, lack of proper maintenance or monitoring and similar events. While we currently maintain business continuity and disaster recovery plans (the “BCPs”), which are intended to minimize service interruptions and secure data integrity, our BCPs may not be sufficient or work effectively during an emergency.
Similarly, although some contracts with our third-party providers, such as our hosting facility providers, require adequate disaster recovery or business continuity capabilities, we cannot be certain that these will be adequate or implemented properly. Our disaster recovery and business continuity plans are heavily reliant on the availability of the internet and mobile phone technology, so any disruption of those systems would likely affect our ability to recover promptly from a crisis situation. If we are unable to execute our disaster recovery and business continuity plans, or if our plans prove insufficient for a particular situation or take longer than expected to implement in a crisis situation, our business, financial condition and results of
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operations could be materially adversely affected, and our business interruption insurance may not adequately compensate us for losses that may occur.
Our inability to avoid or adequately address the failure of our key computer and communication systems exposes us to significant risks, including:
• unanticipateddisruptions in service to our clients;
• slower response times, delays in trade execution and failed settlement of trades;
• incomplete, untimely or inaccurate accounting, recording, reporting or processing of trades;
• financial losses; and
• litigation or other client claims and regulatory sanctions.
We hold a large amount of personally identifiable information relating to our clients and other counterparties, which exposes us to significant regulatory and financial risks if such information is not properly safeguarded. In connection with our business, we collect and retain personally identifiable information of our clients. The continued occurrence of high-profile data breaches provides evidence of the seriousthreats to information security in general and as it relates to our business. Our clients expect that we will adequately protect their personal information, and the regulatory environment surrounding information security and privacy is rapidly evolving and increasingly demanding. Protecting against security breaches, including cyber-security attacks, is an increasing challenge, and penetrated or compromised data systems or the intentional or inadvertent release or disclosure of data has in the past, and may in the future, result in theft, loss or fraudulent or unlawful use of client or company data. It is possible that our security controls over personally identifiable information, our training of employees on data security and other practices we follow may not prevent the improper disclosure of personally identifiable information that we collect, store and manage.
We are exposed to significant risks relating to cybersecurity attacks against our trading platforms, internal databases and other technology systems. Cybersecurity attacks across industries, including ours, are increasing in sophistication and frequency and may range from uncoordinated individual attempts to measures targeted specifically at us. These attacks include but are not limited to, malicious software or viruses, attempts to gainunauthorized access to, or otherwise disrupt, our information systems, attempts to gainunauthorized access to proprietary information, and other electronic security breaches that could lead to disruptions in critical systems, unauthorized release of confidential or otherwise protected information and corruption of data. Cybersecurity failures may be caused by employee error or malfeasance, system errors or vulnerabilities, including vulnerabilities of our vendors, suppliers, and their products. We have been subject to cybersecurity attacks in the past, including breaches of our information technology systems, and may experience them in the future, potentially with more frequency or sophistication. Although we maintain cyber risk insurance, this insurance may not be sufficient to cover all of our losses from any future breaches of our systems.
System failures, inadvertent disclosure of client personal information and/or cybersecurity breachesexpose us to financial losses, regulatory fines or sanctions and third-party litigation. The degradation or failure of the communications and computer systems on which we rely, due to internal system issues, vendor or other third party issues, cybersecurity attacks or for other reasons, or the significant theft, loss or fraudulent use of client information under any circumstances, may lead to financial losses, litigation or arbitration claims filed by or on behalf of our clients, and regulatory investigations and sanctions against us. These events could also have a negative effect on our reputation, which in turn could cause us to lose existing clients to our competitors or make it more difficult for us to attract new clients in the future.
Rapid market or technological changes may render our technology obsolete or decrease the attractiveness of our products and services to our clients. We must continue to enhance and improve our electronic trading platforms. The financial services industry is characterized by significant structural changes, increasingly complex systems and infrastructures, changes in clients’ needs and preferences and new business models. If new industry standards and practices emerge and our competitors release new technology before us, our existing technology, systems and electronic trading platforms may become obsolete or our existing business may be harmed. Our future success will depend on our ability to:
• enhance our existing products and services;
• develop and/or license new products and technologies that address the increasingly sophisticated and varied needs of our clients and prospective clients;
• continue to attract highly-skilled technology personnel; and
• respond to technological advances and emerging industry standards and practices on a cost-effective and timely basis.
Developing our electronic trading platforms and other technology entails significant technical and business risks. We may use new technologies ineffectively or we may fail to adapt our electronic trading platforms, information databases and network infrastructure to client requirements or emerging industry standards. If we face material delays in introducing new services, products and enhancements, our clients may forego the use of our platforms and use those of our competitors.
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Further, the adoption of new internet, networking, cloud, telecommunications or blockchain technologies may require us to devote substantial resources to modify and adapt our services. We cannot assure that we will be able to successfully implement new technologies or adapt our proprietary technology and transaction-processing systems to client requirements or emerging industry standards. We cannot assure that we will be able to respond in a timely manner to changing market conditions or client requirements.
Debt Financing and Indebtedness Risks
The success of our business depends on us having access to significant liquidity. Our business requires substantial cash to support our operating activities, including establishing and carrying substantial open positions for clients on futures exchanges and in the OTC derivatives markets by posting and maintaining margin or credit support for these positions. Although we collect margin or other deposits from our clients for these positions, significant adverse price movements can occur which will require us to post margin or other deposits on short notice, whether or not we are able to collect additional margin or credit support from our clients. We have systems in place to collect margin and other deposits from clients on a same-day basis, however, there can be no assurance that these facilities and systems will be enable us to obtain additional cash on a timely basis. As such, the Company is highly dependent on its lines of credit and other financing facilities in order to fund margin calls and other operating activities and the loss of access to these sources of financing could materially adversely affect our results of operations, financial condition and cash flows.
In addition, tightening of the credit markets could limit our ability to obtain external financing to fund our operations and capital expenditures, if and when needed. For example, Signature Bank was a lender under certain of our facilities, and although we did not experience any adverse impact upon the receivership of Signature Bank, we could experience reduced access to liquidity due to failures of other financial institutions and other parties. If other banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents and investments may be threatened and could substantially and negatively impact our financial condition and ability to do business.
Our significant level of indebtedness could adversely affect our business, financial condition and results of operations. As of September 30, 2025, our total consolidated indebtedness was $1,941.0 million, and we may increase our indebtedness in the future as we continue to expand our business. The level of our indebtedness could have material adverse effects on our business, financial condition and results of operations, including:
• requiring that an increasing portion of our cash flow from operations be used for the payment of interest on our indebtedness, thereby reducing our ability to use our cash flow to fund working capital, capital expenditures, acquisitions, investments and general corporate requirements;
• limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions, investments and general corporate requirements:
• limiting our flexibility in planning for, or reacting to, changes in the economy, the markets, regulatory requirements, our operations or business;
• increasing the risk of a future downgrade of our credit ratings, which could increase future debt costs; and restricting our ability to borrow additional funds or refinance existing debt as needed or take advantage of business opportunities as they arise.
We may incur additional indebtedness in the future, including secured indebtedness. If new indebtedness is added to our current indebtedness levels, the related risks that we now face could increase materially.
As of September 30, 2025, $782.0 million of our borrowings are subject to variable interest rates and as such, in periods of rising interest rates, our cost of funds will increase, which could reduce our net income.
Committed credit facilities currently available to us might not be renewed. As of the date of this report, we have various committed credit facilities under which we could borrow up to $1,705.0 million, consisting of:
• a $650.0 million facility for general working capital requirements, committed until June 3, 2028;
• a $325.0 million facility for short-term funding of margin to commodity exchanges, committed until October 27, 2026;
• a $325.0 million committed facility for financing commodity financing arrangements and commodity repurchase agreements, committed until July 29, 2026;
• a $180.0 million committed subordinated credit facility that complies with the applicable regulatory requirements, and the borrowings are available for computing net capital under the CFTC’s net capital rule for R.J. O’Brien & Associates, LLC, committed until April 30, 2027;
• a $175.0 million facility for short-term funding of margin to commodity exchanges, committed until October 6, 2026; and
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• a $20.0 million facility for general working capital requirements, committed until January 23, 2026;
• a $15.0 million facility for general working capital requirements, committed until September 4, 2026;
• a $15.0 million facility for general working capital requirements, committed until October 1, 2026;
It is possible that these facilities might not be renewed at the end of their commitment periods and that we will be unable to replace them with other facilities on terms favorable to us or at all. If our credit facilities are unavailable or are insufficient to support future levels of business activity, our business, financial condition and results of operations may be materially adversely affected. In addition, in such circumstances, we may need to raise additional debt or equity financing on terms that are unattractive or dilutive to our current shareholders. Moreover, if we cannot raise additional funds on acceptable terms, we may not be able to develop or enhance our business, take advantage of future opportunities or respond to competitive pressure or unanticipated requirements, leading to reduced profitability.
The agreements governing our notes and other debt contain financial covenants that impose restrictions on our business. The indentures governing our 7.875% Senior Secured Notes due 2031, 6.875% Senior Secured Notes due 2032 and the agreements governing our above-mentioned committed credit facilities impose significant operating and financial restrictions and limit our ability and that of our restricted subsidiaries to incur and guarantee additional indebtedness, pay dividends or make other distributions in respect of, or repurchase or redeem, capital stock and prepay, redeem or repurchase certain debt, among other restrictions.
Our failure to comply with these restrictive covenants, as well as others contained in any future debt instruments entered into from time to time, could result in an event of default, which, if not cured or waived, could have a material adverse effect on our business, financial condition and results of operations and result in our being required to repay these borrowings before their maturity. Our inability to generate sufficient cash flow to satisfy our debt obligations, to obtain additional debt or to refinance our obligations on commercially reasonable terms would have a material adverse effect on our business, financial condition and results of operations.
Global Regulatory Risks
The scope and complexity of the regulation to which we are subject creates significant risks for us. The securities and derivatives industries are subject to extensive regulation under federal, state and foreign laws. In addition, the SEC, the CFTC, FINRA, the MSRB, the FCA, the Financial Services Authority, the Cyprus Securities and Exchange Commission, the Investment Industry Regulatory Organization of Canada, the U.S. Office of Special Counsel, the Monetary Authority of Singapore, the Australian Securities and Investments Commission, the Cayman Islands Monetary Authority, the NFA, the CME Group, Inc. and other self-regulatory organizations (commonly referred to as SROs), state securities commissions, and foreign securities regulators require compliance with their respective rules and regulations.
These regulations govern a broad and diverse range of our activities, including, without limitation, risk management, disclosures to clients, reporting requirements, client identification and anti-money laundering requirements, safeguarding client assets and personal information and the conduct of our directors, officers and employees.
Failure to comply with any of these laws, rules or regulations could result in material adverse effects on or business, results of operations and financial condition, including as a result of regulatory investigations and enforcement proceedings, civil litigation, fines and/or other settlement payments. In addition, changes in existing rules or regulations, including the interpretation thereof, or the adoption of new rules or regulations, could subject us to increased cost and risk of regulatory investigation or civil litigation, one or more of which could have a material adverse effect on our business, financial condition and results of operations.
The cost of complying with our regulatory requirements is significant and could increase materially in the future.
We have incurred and expect to continue to incur significant costs to comply with our regulatory requirements, including with respect to the development, operation and continued enhancement of our trading platforms and technology solutions relating to trade execution, trade reporting, trade surveillance and transaction monitoring, record keeping and data reporting. New regulations, including amendments of existing rules, could result in material increases in operating costs in order to comply with additional regulatory requirements.
We are exposed to significant risk from civil litigation and regulatory enforcement actions against us. As a result of the broad scope of our highly regulated business activities and our large and diverse client population, we are subject to various proceedings, lawsuits, disputes and claims arising in the ordinary course of our business, including governmental and regulatory investigations and proceedings, which can be costly and time consuming to defend or address and expose us to risk of loss and fines and penalties. Actions that have been filed against us, and that may be filed against us in the future, include tort claims, contractual disputes, employment matters and workers’ compensation claims. The timing and final resolutions to these types of matters is often uncertain. Additionally, the possible outcomes or resolutions to these matters could include adverse judgments or settlements, either of which could require substantial payments, adversely affecting our liquidity. Moreover, the amounts
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involved in the trades we execute, together with the potential for rapid price movements in the products we offer, can result in potentially large damageclaims in any litigation that arises in connection with such trades.
In addition, the volume of claims and the amount of damages and fines claimed in litigation and regulatory proceedings against financial services firms has been increasing and may continue to increase. The risks relating to litigation and regulatory investigations and enforcement actions will also increase as our business expands.
For a further discussion of litigation risks, see Item 3—Legal Proceedings below and Note 13 - Commitments and Contingencies in the Consolidated Financial Statements.
Certain of our subsidiaries are required to maintain significant levels of net capital and if our subsidiaries fail to meet these requirements, we face suspension, expulsion or limitation on our product lines. Our regulated subsidiaries are subject to a number of requirements to maintain specific levels of net capital. Failure to maintain the required net capital may subject our subsidiaries to suspension or revocation of their license or registration or expulsion from regulatory bodies. Any of these developments could have a material adverse effect on our business, results of operations and financial condition.
In addition to these net capital requirements, certain of our subsidiaries are subject to the deposit and/or collateral requirements of the clearing houses and exchanges in which such subsidiaries participate. These requirements may fluctuate significantly from time to time based upon the nature and size of client trading activity. Failure to meet such requirements could result in our inability to continue to participate in such clearinghouses and exchanges, which could have a material adverse effect on our business, financial condition and results of operation.
Changes in existing net capital rules or the issuance of new rules could restrict our operations or limit our ability to issue dividends or repay debt. Our business depends on the use of capital, most of which is generated and held by our operating subsidiaries. If there are changes to existing net capital rules, or new rules are issued, that require us to hold additional capital at our operating subsidiaries, we may be unable to issue dividends from our subsidiaries to fund our operations or repay our debt, which could have a material adverse effect on our business, financial condition and results of operation.
Rapidly evolving regulations regarding data privacy could increase our costs and adversely affect our business. Our business is subject to rules and regulations adopted by state, federal and foreign governments, and regulatory organizations governing data privacy, including, but not limited to for example, the California Consumer Privacy Act (“CCPA”) and the European General Data Protection Regulation (“GDPR”). Additional states, as well as foreign jurisdictions, have enacted or are proposing similar data protection regimes, resulting in a rapidly evolving landscape governing how we collect, use, transfer and protect personal data.
These laws and regulations are inconsistent across jurisdictions and are subject to evolving interpretations. Government officials, regulators, privacy advocates and class action attorneys are increasingly scrutinizing how companies collect, process, use, store, share, transmit and destroy personal data. We must continually monitor the development and adoption of, and commit substantial time and resources to comply with, new and emerging laws and regulations and/ or expanded interpretations of existing laws. These regulations, as well as changes to existing rules, could result in material increases in operating costs and impact the manner in which our products and services can be offered to our clients. Any inability, or perceived inability, to adequately address privacy and data protection concerns, even if unfounded, and any failure to comply with the CCPA, GDPR or other applicable data protection regulations, policies, industry standards, contractual obligations, or other legal obligations, could subject us to risk of regulatory investigation, penalties, business disruption, civil litigation and reputational harm, and could have a material adverse effect on our business, financial condition and results of operations.
International Operations Risks
Our international operations involve special challenges that we may not be able to meet, which could adversely affect our business, financial condition and results of operations. We engage in a significant amount of business with clients in markets outside the United States. We face certain additional risks that are inherent in doing business in international markets, particularly in the regulated industries in which we participate. These risks include an inability to manage and coordinate the various regulatory requirements of multiple jurisdictions that are constantly evolving and are also subject to unexpected change, difficulties of debt collection and enforcement of contractual rights in foreign jurisdictions and reduced protection for intellectual property rights.
Fluctuations in currency exchange rates could negatively impact our earnings. A significant portion of our international business is conducted in currencies other than the U.S. dollar, and changes in foreign exchange rates relative to the U.S. dollar can therefore affect the value of our non‑U.S. dollar net assets, revenues and expenses. Although we closely monitor potential exposures as a result of these fluctuations in currencies and adopt strategies designed to reduce the impact of these fluctuations on our financial results, there can be no assurance that we will be successful in managing our foreign exchange risk and potential movements in the U.S. dollar against other currencies could adversely affect our results of operations. Our exposure to
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currency exchange rate fluctuations will grow if the relative contribution of our operations outside the U.S. increases. Any material fluctuations in currencies could have a material effect on our financial condition, results of operations and cash flows.
Our international operations are subject to the political, legal and economic risks associated with politically unstable and less developed regions of the world, including the risk of war and other international conflicts and actions by governmental authorities, insurgent groups, terrorists and others. Our international operations are subject to specific risks that are more likely to arise in politically unstable and less developed regions of the world. We may conduct business in countries that are the subject of actual or threatened war, terrorist activity, outbreaks of pandemic or contagious diseases, such as COVID-19, political instability, civil strife and other geopolitical uncertainty, economic and financial instability, highly inflationary environment, unexpected changes in regulatory requirements, tariffs and other trade barriers, exchange rate fluctuations, applicable currency controls, the imposition of restrictions on currency conversion or the transfer of funds and difficulties in staffing and managing foreign operations, including reliance on local experts. As a result of these and other factors, the currencies of these countries may be unstable. Future instability in such currencies or the imposition of governmental or regulatory restrictions on such currencies or on business in such countries could impede our foreign business.
As we operate or otherwise extend our services in certain jurisdictions without local registration, licensing or authorization, we may be subject to possible enforcement actions and sanctions for our operations in such jurisdictions if our operations are determined to have violated regulations in those jurisdictions. Further, we may be required to cease operations in one or more of the countries in which we operate without registration, licensing or authorization, or our growth may be limited by newly imposed regulatory or other restrictions. A portion of our trading volume is attributable to clients in jurisdictions in which we or our white label partners are not currently licensed or authorized by the local government or applicable self-regulatory organization. This includes jurisdictions, such as China, from which we derive revenue and profit, and in which the local government has not adopted specific regulations governing the trading of foreign exchange and CFD products of the types we offer to clients, and jurisdictions in which we operate or otherwise extend our services in reliance on exemptions from the regulatory regime. We determine the nature and extent of services we can offer and the manner in which we conduct our business in the various jurisdictions in which we serve clients based on a variety of factors, including legal advice received from local counsel, our review of applicable U.S. and local laws and regulations and, in some cases, our discussions with local regulators. In cases in which we operate in jurisdictions based on local legal advice and/or cross border in a manner that we believe does not require us to be regulated in a particular jurisdiction, we are exposed to the risk that our legal, regulatory and other analysis is subsequently determined by a local regulatory agency or other authority to be incorrect and that we have not been in compliance with local laws or regulations, including local licensing or authorization requirements, and to the risk that the regulatory environment in a jurisdiction may change, including in a circumstance where laws or regulations or licensing or authorization requirements that previously were not enforced become subject to enforcement.
In such jurisdictions in which we are not licensed or authorized, we may be subject to a variety of restrictions regarding the manner in which we conduct our business or serve clients, including restrictions on:
• our sales and marketing activities;
• the use of a website specifically targeted to potential clients in a particular country;
• our ability to have a physical presence in a particular country; or
• the types of services we may offer clients physically present in each country.
These restrictions may have a material adverse effect on our results of operations and financial condition and/or may limit our ability to grow or continue to operate our business in any such jurisdiction or may result in increased overhead costs or degradation in our services in that jurisdiction. Consequently, we cannot assure you that our operations in jurisdictions where we are not licensed or authorized will continue uninterrupted or that our international expansion plans will be achieved.
We may be subject to possible enforcement action and penalties if we are determined to have previously offered, or currently offer, our services in violation of applicable laws and regulations in any of the markets in which we serve clients. In any such case, we may be required to cease the conduct of our business with clients in one or more jurisdictions. We may also determine that compliance with the laws or licensing, authorization or other regulatory requirements for continuing the business in one or more jurisdictions are too onerous to justify making the necessary changes. In addition, any such event could negatively impact our relationship with the regulators or self-regulatory organizations in the jurisdictions where we are subject to regulation.
Our operations are required to comply with specific anti-corruption and record-keeping laws and regulations applicable to companies conducting business internationally, and if we violate these laws and regulations, it could adversely affect our business and subject us to broader liability. Our international business operations are subject to various anti-corruption laws and regulations, including restrictions imposed by the Foreign Corrupt Practices Act (the “FCPA”) and trade sanctions administered by OFAC. The FCPA is intended to prohibit bribery of foreign officials and requires companies whose securities are listed in the U.S. to keep books and records that accurately and fairly reflect those companies’ transactions and to devise and maintain an adequate system of internal accounting controls. OFAC administers and enforces economic and trade sanctions based on U.S. foreign policy and national security goals against designated foreign states, organizations and individuals.
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Though we have policies in place designed to comply with applicable OFAC sanctions, rules and regulations as well as the FCPA and equivalent laws and rules of other jurisdictions, including the UK Bribery Act 2010, there can be no assurance that, in the future, our business operations will not violate these laws and regulations, and we could be exposed to claims for damages, financial penalties, reputational harm, incarceration of employees and restrictions on our operations and cash flows.
The imposition of new tariffs or changes to existing tariffs could adversely affect our business, financial condition and results of operations. A number of significant structural, political, and monetary issues continue to confront the global economy, and instability could continue, resulting in changes to the level of inflation, market volatility, potential recession, supply chain constraints and costs, diminished trading volumes, uncertainty, increased operating expenses, and increased costs due to potential new tariffs or changes to existing tariffs. The impact of these events and other factors on our financial position and results of operations is difficult to predict, could affect the comparability of our results of operations from period to period, and may have an adverse effect on our financial results.
Competition Risk
We are subject to intense competition. We derive a significant portion of our revenues from market-making and trading activities involving securities, commodities and foreign exchange. The market for these services, particularly market-making services through electronic platforms, is rapidly evolving and intensely competitive. We expect competition to continue and increase in the future. We compete primarily with wholesale, national and regional broker-dealers and FCMs, as well as electronic communications networks and retail brokers. We compete primarily on the basis of our expertise and quality of service.
We also derive a significant portion of our revenues from commodities risk management services. The commodity risk management industry is very competitive and we expect competition to continue to intensify in the future. Our primary competitors in this industry include both large, diversified financial institutions and commodity-oriented businesses, smaller firms that focus on specific products or regional markets and independent FCMs.
A number of our competitors have significantly greater financial, technical, marketing and other resources than we have. Some of them:
• offer alternative forms of financial intermediation as a result of superior technology and greater availability of information;
• offer a wider range of services and products than we offer;
• are larger and better capitalized;
• have greater name recognition; and
• have more extensive client bases.
These competitors may be able to respond more quickly to new or evolving opportunities and client requirements. They may also be able to undertake more extensive promotional activities and offer more attractive terms to clients.
Alternatively, some of our competitors are smaller, subject to lower capital requirements, and may be able to adopt and implement emerging technologies more quickly.
Recent advances in computing and communications technology are substantially changing the means by which market-making and brokerage services are delivered, including more direct access on-line to a wide variety of services and information. This has created demand for more sophisticated levels of client service. Providing these services may entail considerable cost without an offsetting increase in revenues. In addition, current and potential competitors have established or may establish cooperative relationships or may consolidate to enhance their services and products. New competitors or alliances among competitors may emerge and they may acquire significant market share.
We cannot assure you that we will be able to compete effectively with current or future competitors or that the competitive pressures we face will not have a material adverse effect on our business, results of operation and financial condition.
Organizational Risks
Our growth has depended significantly on acquisitions. A large proportion of our historical growth has been achieved through acquisitions of complementary businesses, technologies or services. Our operating revenues grew from $1,673.1 million in fiscal 2021 to $4,126.9 million in fiscal 2025 partially as a result of several acquisitions. We cannot provide any assurances that we will be able to engage in additional suitable acquisitions on attractive terms or at all, or that we would be able to obtain financing for future transactions. If we are not able to enter into additional transactions, our growth may be adversely affected.
There are numerous significant risks associated with acquisitions and our failure to adequately manage these risks could lead to financial loss and a failure to realize the benefits of the transactions. There are a number of significant challenges that need to be overcome in order to realize the benefits of acquisitions, including:
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• integrating the management teams, strategies, cultures, technologies and operations of the acquired companies;
• retaining and assimilating the key personnel of acquired companies;
• retaining existing clients of the acquired companies;
• creating uniform standards, controls, procedures, policies and information systems; and
• achieving revenue growth.
If these risks are not appropriately managed, we may fail to realize the anticipated benefits of such acquisitions or incur unanticipated liabilities, any of which could materially affect our business, financial condition and operating results. In addition, in connection with our acquisitions, we may be required to issue common stock, which would dilute our existing shareholders, or incur additional debt, which would increase our operating costs and potentially strain our liquidity. Moreover, acquisitions could lead to increases in amortization expenses, impairments of goodwill and purchased long-lived assets or restructuring charges, any of which could materially harm our financial condition or results.
Lapses in disclosure controls and procedures or internal control over financial reporting could materially and adversely affect our operations, profitability or reputation. We are committed to maintaining high standards of internal control over financial reporting and disclosure controls and procedures. Nevertheless, lapses or deficiencies in disclosure controls and procedures or in our internal control over financial reporting may occur from time to time. Management identified a material weakness in our internal control over financial reporting as we have determined that our control was not operating effectively to assess the proper presentation of “securities purchased under agreements to resell” and “securities sold under agreements to repurchase” for financial reporting purposes, as it related to netting by counterparty, within the presentation of our consolidated balance sheet and consolidated statement of cash flows as of and for the year ended September 30, 2025 prior to filing. As a result of the material weakness, management concluded that our disclosure controls and procedures were not effective at September 30, 2025. Management is taking steps to remediate the internal control deficiency through additional employee training on the proper review procedures in their respective internal control areas as well as reinforcement of the importance of a strong control environment and clearly communicating expectations to emphasize responsibilities and the technical requirements for internal control.
There can be no assurance that our disclosure controls and procedures will be effective in the future or that a material weakness in internal control over financial reporting will not again exist. Any such lapses or deficiencies may materially and adversely affect our business and results of operations or financial condition, require us to expend significant resources to correct the lapses or deficiencies, expose us to regulatory or legal proceedings, subject us to fines, penalties, judgments or losses not covered by insurance, harm our reputation, or otherwise cause a decline in investor confidence.
Acquisitions give rise to unforeseen issues. Acquisitions involve considerable risk, including the potential disruption of each company’s ongoing business and the distraction of their respective management teams, unanticipated expenses and unforeseen liabilities. Our failure to address these risks or other problems encountered in connection with acquisitions could cause us to fail to realize the anticipated benefits of such acquisitions or incur unanticipated liabilities, any of which could adversely affect our business, financial condition and operating results.
From time to time, we may enter into negotiations for acquisitions or investments that are not ultimately consummated. Such negotiations could result in significant diversion of management time, as well as out-of-pocket costs.
The consideration paid in connection with an investment or acquisition also affects our financial results. If we were to proceed with one or more significant acquisitions in which the consideration included cash, we could be required to use a substantial portion of our available cash to consummate any acquisition. To the extent we issue shares of capital stock or other rights to purchase capital stock, including options or other rights, existing stockholders may be diluted and earnings per share may decrease. In addition, acquisitions may result in the incurrence of debt, large non-recurring write-offs, such as of acquired in-process research and development costs, and restructuring charges.
We depend on our ability to attract and retain key personnel. Competition for key personnel and other highly qualified management, sales, trading, compliance and technical personnel is significant. It is possible that we will be unable to retain our key personnel and to attract, assimilate or retain other highly qualified personnel in the future. The loss of the services of any of our key personnel or the inability to identify, hire, train and retain other qualified personnel in the future could have a material adverse effect on our business, financial condition and operating results.
From time to time, other companies in the financial sector have experienced losses of sales and trading professionals. The level of competition to attract these professionals is intense. It is possible that we will lose professionals due to increased competition or other factors in the future. The loss of a sales and trading professional, particularly a senior professional with broad industry expertise, could have a material adverse effect on our business, financial condition and operating results.
Certain provisions of Delaware law and our charter may adversely affect the rights of holders of our common stock and make a takeover of us more difficult. We are organized under the laws of the State of Delaware. Certain provisions of
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Delaware law may have the effect of delaying or preventing a change in control. In addition, certain provisions of our certificate of incorporation may have anti-takeover effects and may delay, defer or prevent a takeover attempt that a stockholder might consider in its best interest. Our certificate of incorporation authorizes the board to determine the terms of our unissued series of preferred stock and to fix the number of shares of any series of preferred stock without any vote or action by our stockholders. As a result, the board can authorize and issue shares of preferred stock with voting or conversion rights that could adversely affect the voting or other rights of holders of our common stock. In addition, the issuance of preferred stock may have the effect of delaying or preventing a change of control, because the rights given to the holders of a series of preferred stock may prohibit a merger, reorganization, sale, liquidation or other extraordinary corporate transaction.
violations
caution
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Overview
We operate a global financial services network that connects companies, organizations, traders and investors to the global market ecosystem through a unique blend of digital platforms, end-to-end clearing and execution services, high touch service and deep expertise. We strive to be the one trusted partner to our clients, providing our network, products and services to allow them to pursue trading opportunities, manage their market risks, make investments and improve their business performance. Our businesses are supported by our global infrastructure of regulated operating subsidiaries, our advanced technology platforms and our team of more than 5,400 employees as of September 30, 2025. We believe our client-first approach differentiates us from large banking institutions, engenders trust and enables us to establish leading positions in a number of complex fields in financial markets around the world. For additional information, see Overview of Business and Strategy within Item 1. Business section of this Annual Report on Form 10-K.
We report our operating segments based primarily on the nature of the clients we serve (commercial, institutional, and self-directed/retail), and a fourth operating segment, our payments business. This structure allows us to efficiently serve clients in more than 180 countries and manage our large global footprint. See Segment Information for a listing of business activities performed within our reportable segments.
StoneX Group Inc. and its trade name "StoneX" carry forward the foundation established by Saul Stone in 1924 to today's modern financial services firm. Today, we provide an institutional-grade financial services ecosystem, connecting our clients to over 40 derivatives exchanges, 180 foreign exchange markets, most global securities exchanges and over 18,000 over-the-counter (“OTC”) markets via our networks of highly integrated digital platforms and experienced professionals. Our platform delivers support throughout the entire lifecycle of a transaction, from consulting and boots-on-the-ground intelligence, to efficient execution, to post-trade clearing, custody and settlement.
Recent Events
Closing of the Acquisition of R.J. O’Brien
On July 31, 2025, we completed our acquisition RTS Investor Corp., which was the parent company for the R.J. O’Brien global business (“RJO”), including R.J. O’Brien & Associates, LLC, the oldest futures brokerage in the U.S., and selected affiliates. The purchase price consideration was paid in a combination of cash of approximately $651.9 million and the issuance of 3,085,554 shares of the Company’s common stock, which were reissued from treasury stock. At closing, we assumed approximately $125.7 million of RJO debt related to a RJO subordinated debt facility. We believe the acquisition significantly strengthens our position as a leading FCM and enhances our role as an essential part of the global financial market structure, offering institutional grade execution, clearing, custody, and prime brokerage across all asset classes. The acquisition expanded our client float and added many introducing brokers to our network, while RJO’s clients benefit from our extensive range of markets, products, and services.
In connection with the acquisition of RJO, on July 8, 2025, we issued $625.0 million in aggregate principal amount of Senior Secured Notes due 2032 (the “Notes due 2032”), which are fully and unconditionally guaranteed, jointly and severally, on a senior secured second lien basis, by certain existing and future subsidiaries that guarantees indebtedness under the Company’s senior secured revolving credit facility and certain other senior indebtedness. The Notes due 2032 will mature on July 15, 2032. Interest on the Notes due 2032 accrues at a rate of 6.875% per annum and is payable semiannually in arrears on January 15 and July 15 of each year, commencing on January 15, 2026. On July 31, 2025, the net proceeds from the issuance of the Notes due 2032 were used to fund the cash portion of the purchase price and to pay related fees and expenses, as described above.
Closing of the Acquisition of Benchmark
On July 31, 2025, we completed our acquisition of The Benchmark Company, LLC (“Benchmark”). Benchmark is a full-service investment banking firm offering a robust sales and trading platform, award-winning equity research, and a highly experienced investment banking team. We believe this acquisition will strengthen our offerings in equity and debt capital markets, with significant enhancements in equity research and investment banking. The purchase price consideration includes cash of approximately $57.1 million and four annual contingent payments, each capped at $7.0 million, plus a final contingent payment for any excess above the annual caps over the four year period following the close, valued together at $25.3 million.
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Potential Impacts of New Tariffs or Changes to Existing Tariffs
A number of significant structural, political, and monetary issues, and global conflicts continue to confront the global economy, and instability could continue, resulting in changes to the level of inflation, market volatility, potential recession, supply chain constraints and costs, diminished trading volumes, uncertainty, increased operating expenses, and increased costs due to potential new tariffs or changes to existing tariffs. The impact of these events and other factors on our financial position and results of operations is difficult to predict, could affect the comparability of our results of operations from period to period, and may have an adverse effect on our financial results.
Common Stock Split
On March 21, 2025, we completed a three-for-two split of our common stock, effected as a stock dividend entitling each shareholder of record to receive one additional share of common stock for every two shares owned. Additional shares issued as a result of the stock dividend were distributed after close of trading on March 21, 2025, to stockholders of record at the close of business on March 11, 2025. Cash was distributed in lieu of fractional shares based on the opening price of a share of common stock on March 12, 2025. All share and per share amounts contained herein have been retroactively adjusted for this stock split.
Executive Summary
We achieved record net operating revenues, up 16%, and net income, up 17%, in fiscal 2025, despite experiencing generally diminished commodity volatility, declining short-term interest rates, heightened interest expense and logistical charges in our precious metals activities related to tariff related disruptions. We experienced growth in segment income across all of our operating segments, led by a 45% increase in the segment income of our Institutional segment, driven by strong performances in equity trading and prime brokerage as well as in listed derivatives.
We experienced an increase in transaction volumes across all of our product offerings, as well as growth in average client equity and average money market/FDIC sweep client balances as compared to the prior year.
In terms of revenue capture on our transactional volumes as compared to the prior fiscal year, we experienced:
• Rate per contract (“RPC”) on listed derivatives increased 8%, due to client mix as well as the acquisition of RJO.
• OTC derivatives RPC declined 3%, with diminished commodity volatilityleading to lower spreads captured.
• 9% growth in securities rate per million (“RPM”), primarily due to improved performance in global equity markets.
• a 7% decline in FX/CFD RPM, due to product mix and diminished FX volatility
• an 11% decline in payments RPM due to generally lower FX spreads in certain markets, most notably in Africa.
Interest and fee income earned on client balances increased $45.7 million, principally driven by the acquisition of RJO which contributed $50.0 million. This increase was partially offset by the decline in short term interest rates. Average client equity and average money-market/FDIC sweep client balances increased 25% and 21%, respectively.
Interest expense on corporate funding increased $10.0 million, primarily as a result of $7.8 million in bridge loan interest expense and the incremental interest expense associated with the senior secured notes issued related to the acquisition of RJO.
On the expense side, we continued to focus on maintaining our variable cost model and limiting the growth of our non-variable expenses. Variable expenses were 54% of total expenses in the fiscal year ended September 30, 2025 as compared to 52% in the fiscal year ended September 30, 2024. Non-variable expenses, excluding bad debts, increased $124.5 million, including $32.4 million in the acquired RJO and Benchmark businesses as well as $10.4 million in investment banking and M&A related professional fees related to the RJO acquisition.
Net income increased $45.1 million to $305.9 million in the fiscal year ended September 30, 2025. Diluted earnings per share was $5.89 for the fiscal year ended September 30, 2025 compared to $5.31 in the fiscal year ended September 30, 2024.
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Selected Summary Financial Information
Results of Operations
Our total revenues, as reported, combine gross revenues for the physical commodities business and net revenues for all other businesses. Management believes that operating revenues, which deduct the cost of sales of physical commodities from total revenues, is a more useful financial measure with which to assess our results of operations. The table below sets forth our operating revenues, as well as other key financial measures, for the periods indicated.
Financial Overview
Fiscal Year Ended September 30,
(in millions)
% Change
% Change
Revenues:
Sales of physical commodities
Principal gains, net
Commission and clearing fees
Consulting, management, and account fees
Interest income
Total revenues
Cost of sales of physical commodities
Operating revenues
Transaction-based clearing expenses
Introducing broker commissions
Interest expense
Interest expense on corporate funding
Net operating revenues
Variable compensation and benefits
Net contribution
Fixed compensation and benefits
Trading systems and market information
Professional fees
Non-trading technology and support
Occupancy and equipment rental
Selling and marketing
Travel and business development
Communications
Depreciation and amortization
Bad debts, net of recoveries
Other expenses
Total fixed compensation and other expenses
Gain on acquisition and other gains, net
Income before tax
Income tax expense
Net income
Return on equity (“ROE”) (1)
(1) The Company calculates ROE on stated book value based on net income divided by the average stockholders’ equity, calculated based on average monthly equity amounts.
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The tables below present operating revenues disaggregated across the key products we provide to our clients and select operating data and metrics used by management in evaluating our performance, for the periods indicated.
Fiscal Year Ended September 30,
% Change
% Change
Operating Revenues (in millions):
Listed derivatives
OTC derivatives
Securities
FX/CFD contracts
Payments
Physical contracts
Interest/fees earned on client balances
Other
Corporate
Eliminations
Fiscal Year Ended September 30,
% Change
% Change
Volumes and Other Select Data:
Listed derivatives (contracts, 000’s) (1)
Listed derivatives, average RPC (2)
Average client equity - listed derivatives (millions) (1)
OTC derivatives (contracts, 000’s)
OTC derivatives, average RPC
Securities average daily volume (“ADV”) (millions)
Securities RPM (3)
Average MM/FDIC sweep client balances (millions)
FX/CFD contracts ADV (millions)
FX/CFD contracts RPM
Payments ADV (millions)
Payments RPM
Adjusted EBITDA (4)
The acquisition of RJO, effective July 31, 2025, contributed 20.0 million listed derivative contracts in the fiscal year ended September 30, 2025. Also, for the fiscal year ended September 30, 2025, the average client equity includes the effect of an incremental $5.6 billion per month from RJO for the two months post-acquisition.
Give up fee revenues, related to contract execution for clients of other FCMs, as well as cash and voice brokerage revenues are excluded from the calculation of listed derivatives, average rate per contract.
Interest expense associated with our fixed income activities is deducted from operating revenues in the calculation of Securities RPM, while interest income related to securities lending is excluded.
Adjusted EBITDA is a non-GAAP measure. See Liquidity, Financial Condition and Capital Resources - Non-GAAP Financial Information for further information.
Operating Revenues
Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
Operating revenues increased $690.7 million, or 20%, to $4,126.9 million in the fiscal year ended September 30, 2025 compared to $3,436.2 million in the fiscal year ended September 30, 2024. The acquisition of RJO contributed $141.0 million in operating revenues.
Operating revenues from listed derivatives increased $104.6 million, principally driven by the acquisition of RJO which contributed $89.5 million. Our Commercial and Institutional segments were up $53.8 million and $50.8 million, respectively.
Operating revenues in OTC derivatives increased $4.5 million, principally driven by a 6% increase in OTC contract volumes, which was partially offset by a 3% decline in the average rate per contract.
Table of C ontents
Operating revenue from securities transactions increased $390.9 million, principally due to a 27% increase in securities ADV as well as a 9% increase in securities RPM. Carried interest on fixed income securities is a component of operating revenues, however, interest expense associated with financing these positions is not. In the calculation of securities RPM in the table above, we deduct interest expense associated with our fixed income activities from operating revenues, as well as exclude interest income related to securities lending, in order to provide a more useful measure of the financial performance of our securities business. Net operating revenues derived from securities transactions increased $126.1 million, principally driven by the increase in ADV and RPM noted above.
Operating revenues from FX/CFD contracts decreased $3.6 million, with a $3.8 million decline in our Institutional segment, partially offset by a $0.2 million increase in our Self-Directed/Retail segment.
Operating revenues from payments increased by $4.1 million, principally driven by a 16% increase in the ADV, which was partially offset by an 11% decline in payments RPM.
Operating revenues from physical contracts increased $69.1 million, driven by increases of $41.2 million and $27.9 million in our physical agricultural and energy and precious metals businesses, respectively. Precious metals related operating revenues were unfavorably impacted by $5.2 million and $6.8 million in the fiscal year ended September 30, 2025 and 2024, respectively, by unrealized losses on derivative positions related to physical inventories carried at the lower of cost or net realizable value.
Interest and fee income earned on client balances, which is associated with our listed and OTC derivative businesses, as well as our Correspondent Clearing and Independent Wealth Management businesses, increased $45.7 million, principally driven by the acquisition of RJO which contributed $50.0 million. This increase was partially offset by the decline in short term interest rates. Average client equity and average money-market/FDIC sweep client balances increased 25% and 21%, respectively. For the fiscal year ended September 30, 2025, the average client equity includes the effect of an incremental $5.6 billion per month from RJO for the two months post-acquisition.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
For a discussion of changes for the year ended September 30, 2024 compared to the year ended September 30, 2023 refer to the Annual Report on Form 10-K filed with the SEC on November 29, 2024.
Interest and Transactional Expenses
Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
Transaction-based clearing expenses
Fiscal Year Ended September 30,
$ Change
% Change
Transaction-based clearing expenses
Percentage of operating revenues
The business activities of RJO added $24.5 million of increased expenses. Additionally, expenses were higher in the Equity and Debt Capital Markets businesses, principally related to the increased ADV, along with an increase in ADR conversion fees. Additionally, excluding RJO, expenses were higher in our Financial Ag and Energy business, principally related to the increase in contracts traded, and within our Correspondent Clearing business.
Introducing broker commissions
Fiscal Year Ended September 30,
$ Change
% Change
Introducing broker commissions
Percentage of operating revenues
The business activities of RJO added $27.4 million of increased expenses. Expenses were higher in our Independent Wealth Management and Self-Directed/Retail Forex businesses, principally due to increased revenues and higher payouts, as well as in our Financial Ag and Energy and LME businesses, principally due to increased volume and client mix traded. These increases were partially offset by lower introducing broker commissions in our Exchange-Traded Futures & Options business, excluding RJO.
Table of C ontents
Interest expense
Fiscal Year Ended September 30,
$ Change
% Change
Interest expense attributable to:
Trading activities:
Institutional dealer in fixed income securities
Securities borrowing
Client balances on deposit
Short-term financing facilities of subsidiaries and other direct interest of operating segments
Corporate funding
Total interest expense
The increase in interest expense attributable to fixed income securities and securities borrowing was principally due to the growth in the size of the security repo and securities lending businesses. The business activities of RJO added an incremental $17.6 million of interest expense attributable to client balances. The increase in other direct interest expense attributable to operating segments principally resulted from an increase in our physical precious metals business activities and our equity securities trading activities.
During the year ended September 30, 2025, interest expense attributable to corporate funding included $3.1 million of bridge loan financing fees related to the amendment of our revolving credit facility. In addition, the period included interest expense attributable to corporate funding of $4.7 million, related to bridge loan financing fees for the issuance of $625 million in aggregate principal amount of the Notes due 2032, which closed on July 8, 2025.
During the year ended September 30, 2024, interest expense attributable to corporate funding included incremental interest from our March 1, 2024 issuance of $550 million in aggregate principal amount of the Notes due 2031, the proceeds of which were used to redeem the Notes due 2025. This redemption did not occur until June 17, 2024, in order to redeem those notes at par, and therefore there was a temporary period in which both the Notes due 2025 and Notes due 2031 were outstanding. In addition, upon completion of the redemption of the Notes due 2025, we recognized a $3.7 million loss on the extinguishment of debt related to the write-off of unamortized original issue discount and deferred financing costs, which we classified as a component of Interest expense on corporate funding on the Consolidated Income Statements.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
For a discussion of changes for the year ended September 30, 2024 compared to the year ended September 30, 2023 refer to the Annual Report on Form 10-K filed with the SEC on November 29, 2024.
Net Operating Revenues
Net operating revenues is one of the key measures used by management to assess the performance of our operating segments. Net operating revenue is calculated as operating revenue less transaction-based clearing expenses, introducing broker commissions and interest expense. Transaction-based clearing expenses represent variable expenses paid to executing brokers, exchanges, clearing organizations and banks in relation to our transactional volumes. Introducing broker commissions include payments to non-employee third parties that have introduced clients to us. Net operating revenues represent revenues available to pay variable compensation to risk management consultants and traders and direct non-variable expenses, as well as variable and non-variable expenses of operational and administrative employees, including our executive management team.
Table of C ontents
The table below presents net operating revenues disaggregated across the key products we provide to our clients used by management in evaluating our performance, for the periods indicated.
Fiscal Year Ended September 30,
% Change
% Change
Net Operating Revenues (in millions):
Listed derivatives
OTC derivatives
Securities
FX/CFD contracts
Payments
Physical contracts
Interest, net / fees earned on client balances
Other
Corporate
Compensation and Other Expenses
The following table presents a summary of expenses, other than interest and transactional expenses.
Fiscal Year Ended September 30,
(in millions)
% Change
% Change
Compensation and benefits:
Variable compensation and benefits
Fixed compensation and benefits
Other expenses:
Trading systems and market information
Professional fees
Non-trading technology and support
Occupancy and equipment rental
Selling and marketing
Travel and business development
Communications
Depreciation and amortization
Bad debts, net of recoveries
Other
Total compensation and other expenses
Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
Compensation and Other Expenses: Compensation and other expenses increased $227.6 million, or 16%, to $1,649.5 million in the fiscal year ended September 30, 2025 compared to $1,421.9 million in the fiscal year ended September 30, 2024.
Table of C ontents
Compensation and Benefits:
Fiscal Year Ended September 30,
(in millions)
$ Change
% Change
Compensation and benefits:
Variable compensation and benefits
Front office
Administrative, executive, and centralized and local operations
Total variable compensation and benefits
Variable compensation and benefits as a percentage of net operating revenues
Fixed compensation and benefits:
Non-variable salaries
Employee benefits and other compensation
Share-based compensation
Severance
Total fixed compensation and benefits
Total compensation and benefits
Total compensation and benefits as a percentage of operating revenues
Number of employees, end of period
Incremental cost from acquisitions completed during the fiscal year ended September 30, 2025 added $14.4 million of non-variable salary expense. The additional increase of $23.4 million is principally due to expansion in our Commercial and Institutional business segments, as well as within our overhead departments, principally due to the increase in headcount, as well as the impact of annual merit increases.
Employee benefits and other compensation increased principally due to higher payroll taxes, retirement costs, and healthcare benefits principally related to the increase in headcount. The fiscal year ended September 30, 2025 and 2024 included $0.9 million in accelerated long-term incentive due to the departures of executive officers.
Share-based compensation, which contains stock option and restricted stock expense, increased principally due to the issuance of additional stock option awards during 2024 and 2025 and additional restricted stock grants, as well as from increased restricted stock amortization related to employee-elected and statutorily-required deferred incentive, which results in cash exchanged for restricted stock that is amortized over a thirty-six month period following the grant date. The fiscal year ended September 30, 2025 and 2024 also included $1.1 million and $0.9 million, respectively, in accelerated share-based compensation due to the departure of executive officers.
During the fiscal year ended September 30, 2025 and 2024, severance costs included amounts related to the departure of executive officers.
Other Expenses: Other non-compensation expenses increased $62.3 million, or 13%, to $541.8 million in the fiscal year ended September 30, 2025 compared to $479.5 million in the fiscal year ended September 30, 2024.
Professional fees increased $16.6 million, principally due to investment banking fees related to the closing of the RJO acquisition, as well as higher legal fees related to our defense in various legal matters, net of recoveries, and increased merger and acquisition activity during the fiscal year ended September 30, 2025. Incremental cost from acquired entities completed during the fiscal year ended September 30, 2025 added $4.2 million of expense.
Non-trading technology and support costs increased $13.9 million, principally due to an increase in headcount driven technology costs and compliance costs. Incremental cost from acquisitions completed during the fiscal year ended September 30, 2025 added $2.3 million of expense.
Occupancy and equipment rental costs increased $6.7 million, principally due to the year ended September 30, 2024 including a partial refund of property rates covering prior years in London, and an increase in costs of utilities. Incremental cost from acquired entities completed during the fiscal year ended September 30, 2025 added $3.8 million of expense.
Travel and business development increased $4.6 million, principally due to an increase in higher transportation and lodging costs across our Commercial and Institutional segments and support departments. Incremental cost from acquired entities completed during the fiscal year ended September 30, 2025 added $0.8 million of expense.
Depreciation and amortization increased $14.4 million, principally due to $10.5 million of incremental depreciation expense from internally developed software placed into service, and incremental amortization of acquired intangibles from the acquisitions completed in fiscal 2025, partially offset by decreased amortization of certain intangibles recognized as part of
Table of C ontents
previous acquisitions which became fully amortized during fiscal 2024. Amortization of acquired intangibles related to the RJO and Benchmark acquisitions was $3.6 million during the fiscal year ended September 30, 2025.
During the fiscal year ended September 30, 2025, we recorded bad debts, net of recoveries of $3.1 million, principally related to bad debt expense from client trading deficits in our Self-Directed/Retail segment and Financial Ag & Energy business of our Commercial segment of $1.5 million and $1.7 million, respectively, which were partially offset by $0.1 million of recoveries within the LME business of our Commercial segment. During the fiscal year ended September 30, 2024, we recorded net recoveries of bad debts of $0.6 million, principally related to recoveries within our Institutional segment of $1.3 million, which were partially offset by bad debt expense of $1.2 million of client receivables in the Payments segment, $0.5 million within the Self-Directed/Retail segment, and $0.2 million within the Commercial segment.
Other Gains, net: The results of the fiscal year ended September 30, 2025 include gains of $8.1 million, resulting from proceeds received from class action settlements, partially offset by a $2.3 million loss on the disposal of certain capitalized hardware expenditures and a $0.3 million loss on equity investment. The results of the fiscal year ended September 30, 2024 included gains of $8.8 million resulting from proceeds received from class action settlements.
Provision for Taxes: Our effective income tax rate was 25% and 26% for fiscal year ended September 30, 2025 and 2024, respectively. The effective income tax rate was higher than the U.S. federal statutory rate of 21% due to U.S. state and local taxes, changes in valuation allowances, GloBe minimum tax, BEAT, GILTI, and the amount of foreign earnings taxed at lower tax rates.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
For a discussion of changes for the year ended September 30, 2024 compared to the year ended September 30, 2023 refer to the Annual Report on Form 10-K filed with the SEC on November 29, 2024.
Variable vs. Fixed Expenses
The table below presents our variable expenses and non-variable expenses as a percentage of total non-interest expenses for the periods indicated.
Fiscal Year Ended September 30,
(in millions)
Total
Total
Total
Variable compensation and benefits
Transaction-based clearing expenses
Introducing broker commissions
Total variable expenses
Fixed compensation and benefits
Other fixed expenses
Bad debts, net of recoveries
Total non-variable expenses
Total non-interest expenses
Our variable expenses include variable compensation paid to traders and risk management consultants, bonuses paid to operational, administrative, and executive employees, transaction-based clearing expenses and introducing broker commissions. We seek to make our non-interest expenses variable to the greatest extent possible, and to keep our fixed costs as low as possible.
During the fiscal year ended September 30, 2025, non-variable expenses, excluding bad debts, net of recoveries, increased $124.5 million, or 14%, compared to the fiscal year ended September 30, 2024.
During the fiscal year ended September 30, 2024, non-variable expenses, excluding bad debts, net of recoveries, increased $91.1 million, or 11%, compared to the fiscal year ended September 30, 2023.
Segment Information
Our operating segments are based principally on the nature of the clients we serve (commercial, institutional, and self-directed/retail), and a fourth operating segment, our payments business. We manage our business in this manner due to our large global footprint, in which we have more than 5,400 employees allowing us to serve clients in more than 180 countries.
Table of C ontents
During the three months ended September 30, 2025, our acquisition of RJO triggered a reassessment of the financial information reviewed by management. We determined the acquired business activities of RJO were similar to our existing businesses, and the reassessment confirmed the current composition of the Company’s operating segments, except for one change resulting in the combination of all physical trading capabilities in precious metals being reported within the Commercial segment. Previously, the Self-Directed/Retail segment contained a portion of our precious metals activities. All segment information has been revised to reflect all precious metals business within the Commercial segment retroactive to October 1, 2022.
Our business activities are managed as operating segments, which are our reportable segments for financial reporting purposes, as shown below.
StoneX Group Inc.
Commercial
Institutional
Self-Directed/Retail
Payments
Primary Activities:
Primary Activities:
Primary Activities:
Primary Activities:
Financial Ag
& Energy
Equity Capital
Markets
Forex/CFD
Payments
LME Metals
Debt Capital
Markets
Independent
Wealth Management
Payment Technology
Services
Physical Ag
& Energy
FX Prime Brokerage
Precious Metals
Exchange-Traded
Futures & Options
Correspondent
Clearing
Total revenues, operating revenues and net operating revenues shown as “Corporate” primarily consist of interest income from our centralized corporate treasury function. Corporate also includes net costs not allocated to operating segments, including costs and expenses of certain shared services such as information technology, accounting and treasury, credit and risk, legal and compliance, and human resources and other activities. For additional information regarding Corporate, see Note 22 to the Consolidated Financial Statements.
Operating revenues, net operating revenues, net contribution and segment income are some of the key measures used by management to assess the performance of each segment and for decisions regarding the allocation of our resources. Operating revenues are calculated as total revenues less cost of sales of physical commodities.
Net operating revenue is calculated as operating revenue less transaction-based clearing expenses, introducing broker commissions and interest expense.
Net contribution is calculated as net operating revenues less variable compensation. Variable compensation paid to risk management consultants and traders generally represents a fixed percentage that can vary by revenue type. This fixed percentage is applied to revenues generated, and in some cases, revenues generated less transaction-based clearing expenses, base salaries and other expenses/allocations.
Segment income is calculated as net contribution less non-variable direct segment costs. These non-variable direct expenses include trader base compensation and benefits, operational charges, trading systems and market information, professional fees, travel and business development, communications, bad debts, trade errors and direct marketing expenses.
Segment income is used by our chief operating decision maker (“CODM”) as the primary measure of segment profit or loss in the evaluation for each of our operating segments. During the year ended September 30, 2024, we revised our method of allocating certain overhead costs to our operating segments, and, beginning in the year ended September 30, 2024, the CODM also uses ‘Segment income, less allocation of overhead costs’ as an additional segment measure of our segments’ financial performance. The allocation of overhead costs to operating segments includes costs associated with compliance, technology, and credit and risk costs. The share of allocated costs is based on resources consumed by the relevant businesses. In addition, the allocation of human resources and occupancy costs is principally based on employee costs within the relevant businesses. The measure of segment profit or loss most consistent with the corresponding amounts in the consolidated financial statements is segment income.
Table of C ontents
In the accompanying segment tables, ‘Allocation of overhead costs’ has been added beneath ‘Segment income’, which reconciles the segment income measure to the segment income, less allocation of overhead costs measure beginning with the year ended September 30, 2024.
Total Segment Results
The following table presents summary information concerning all of our business segments on a combined basis, excluding Corporate, for the periods indicated.
Fiscal Year Ended September 30,
(in millions)
% of Operating Revenues
% of Operating Revenues
% of Operating Revenues
Sales of physical commodities
Principal gains, net
Commission and clearing fees
Consulting, management, and account fees
Interest income
Total revenues
Cost of sales of physical commodities
Operating revenues
Transaction-based clearing expenses
Introducing broker commissions
Interest expense
Net operating revenues
Variable compensation and benefits
Net contribution
Fixed compensation and benefits
Trading systems and market information
Professional fees
Non-trading technology and support
Selling and marketing
Travel and business development
Depreciation and amortization
Bad debts, net of recoveries
Shared services
Other fixed expenses
Total non-variable direct expenses
Other gains
Segment income
Allocation of overhead costs (1)
Segment income, less allocation of overhead costs
(1) Includes an allocation of certain overhead costs to our operating segments as noted above for the fiscal years ended September 30, 2025 and 2024. These allocations will be provided on an ongoing basis but have not been calculated for fiscal year ended September 30, 2023.
Commercial
We offer our commercial clients a comprehensive array of products and services, including risk management and hedging services, execution and clearing of exchange-traded and OTC products, voice brokerage, market intelligence and physical trading, as well as commodity marketing, procurement, logistics and price management services. We believe providing these high-value-added products and services differentiates us from our competitors and maximizes our ability to retain our clients.
Table of C ontents
As noted in the beginning of this Segment Information section, the portion of our precious metals activities previously reported in our Self-Directed/Retail segment have been moved into and combined with our precious metals activities within this segment. All segment information has been revised to reflect all precious metals business within this segment retroactive to October 1, 2022.
The tables below present the financial performance, a disaggregation of operating revenues, and select operating data and metrics used by management in evaluating the performance of the Commercial segment, for the periods indicated.
Year Ended September 30,
(in millions)
% Change
% Change
Revenues:
Sales of physical commodities
Principal gains, net
Commission and clearing fees
Consulting, management and account fees
Interest income
Total revenues
Cost of sales of physical commodities
Operating revenues
Transaction-based clearing expenses
Introducing broker commissions
Interest expense
Net operating revenues
Variable compensation and benefits
Net contribution
Fixed compensation and benefits
Trading systems and market information
Professional fees
Non-trading technology and support
Selling and marketing
Travel and business development
Depreciation and amortization
Bad debts, net of recoveries
Shared services
Other fixed expenses
Non-variable direct expenses
Other gains
Segment income
Allocation of overhead costs (1)
Segment income, less allocation of overhead costs
(1) Includes an allocation of certain overhead costs to our operating segments as noted above for the years ended September 30, 2025 and 2024. These allocations will be provided on an ongoing basis but have not been calculated for the year ended September 30, 2023.
Table of C ontents
Fiscal Year Ended September 30,
% Change
% Change
Operating Revenues (in millions):
Listed derivatives
OTC derivatives
Physical contracts
Interest / fees earned on client balances
Other
Select data (all $ amounts are U.S. dollar equivalent):
Listed derivatives (contracts, 000’s) (1)
Listed derivatives, average rate per contract (2)
Average client equity - listed derivatives (millions) (1)
(1) The acquisition of RJO, effective July 31, 2025, contributed 4.1 million listed derivative contracts in the fiscal year ended September 30, 2025. Also, for the fiscal year ended September 30, 2025, the average client equity includes the effect of an incremental $2.3 billion per month from RJO for the two months post-acquisition.
(2) Give up fees, related to contract execution for clients of other FCMs, as well as cash and voice brokerage are excluded from the calculation of listed derivatives, average rate per contract.
For information about the assets of this segment, see Note 22 to the Consolidated Financial Statements.
Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
Operating revenues increased $128.6 million, or 15%, to $1,005.9 million in the fiscal year ended September 30, 2025 compared to $877.3 million in the fiscal year ended September 30, 2024. Net operating revenues increased $47.8 million, or 7%, to $768.7 million in the fiscal year ended September 30, 2025 compared to $720.9 million in the fiscal year ended September 30, 2024.
Operating revenues derived from listed derivatives increased $53.8 million, principally driven by a 29% increase in listed derivative contract volumes, partially offset by a 7% decrease in the average rate per contract. The decline in the average rate per contract was primarily related to activity in LME base metals markets as compared to the prior year, as the prior year benefited from a widening of spreads related to U.S. and U.K. imposed sanctions on Russian base metals exports. The acquired RJO business contributed $35.3 million in operating revenues derived from listed derivatives.
Operating revenues derived from OTC transactions increased $4.5 million, principally resulting from a 6% increase in OTC derivative contract volumes, which was partially offset by a 3% decline in the average rate per contract.
Operating revenues derived from physical transactions increased $69.1 million, principally driven by $41.2 million and $27.9 million increases in operating revenues in our physical agricultural and energy and precious metals businesses, respectively. The increase in physical agricultural and energy operating revenues were primarily driven by strong performance in global cocoa and coffee markets. Precious metals related operating revenues were unfavorably impacted by $5.2 million and $6.8 million in the fiscal year ended September 30, 2025 and 2024, respectively, by unrealized losses on derivative positions related to physical inventories carried at the lower of cost or net realizable value.
Interest and fee income earned on client balances increased $1.4 million, primarily as a result of the acquisition of RJO, which contributed $16.7 million in interest and fee income earned on client balances and helped drive a 23% increase in average client equity. This increase was partially offset by the decline in short term interest rates.
Interest expense increased $41.6 million, primarily related to heightened interest expense in our precious metals business related to carrying costs on inventory which was held in the U.S. to mitigate against possible U.S. government tariffs on imported precious metals.
Variable expenses, excluding interest, expressed as a percentage of operating revenues, were 34% and 33% for the fiscal year ended September 30, 2025 and 2024, respectively.
Segment income increased $4.3 million, primarily related to the increase in operating revenues noted above, which were partially offset by a $26.3 million increase in introducing broker commissions and a $12.9 million increase in transaction-based clearing expenses, each of which was principally driven by the acquisition of RJO. In addition, the operating revenue growth was also partially offset by the increase in interest expense noted above, an $18.4 million increase in variable compensation and an $19.2 million increase in non-variable direct expenses, of which $4.1 million was attributable to the RJO business. Segment income for the fiscal year ended September 30, 2025 and 2024 include gains of $1.0 million and $6.9 million, respectively, related to proceeds received from class action settlements.
Table of C ontents
For the fiscal year ended September 30, 2025, we calculated an allocation for overhead costs of $39.2 million for the Commercial segment compared to a $35.6 million allocation in the fiscal year ended September 30, 2024.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
Operating revenues increased $2.6 million to $877.3 million in the fiscal year ended September 30, 2024 compared to $874.7 million in the fiscal year ended September 30, 2023. Net operating revenues decreased $11.9 million, or 2%, to $720.9 million in the fiscal year ended September 30, 2024 compared to $732.8 million in the fiscal year ended September 30, 2023.
Operating revenues derived from listed derivatives increased $31.8 million, principally driven by a 16% increase in listed derivative contract volumes, primarily in agricultural and LME base metal commodity markets. This was partially offset by a 1% decline in the average rate per contract.
Operating revenues derived from OTC transactions declined $22.3 million, principally driven by a 9% decline in the average rate per contract as a result of a decline in commodity volatility.
Operating revenues derived from physical transactions declined $27.0 million, principally driven by a $31.0 million decline in operating revenues in our physical agricultural and energy business which was partially offset by a $4.0 million increase in operating revenues in our precious metals businesses.
Interest and fee income earned on client balances increased $18.0 million, as a result of an increase in the short-term interest rates realized, which was partially offset by an 11% decrease in average client equity.
Variable expenses, excluding interest, expressed as a percentage of operating revenues, were 33% in the fiscal year ended September 30, 2024 compared to 32% in the fiscal year ended September 30, 2023.
Segment income decreased $9.0 million, partially due to the decline in net operating revenues, as well as a $22.2 million increase in non-variable direct expenses, excluding bad debts, net of recoveries. The increase in non-variable direct expenses was primarily due to a $7.5 million increase in fixed compensation and benefits, a $1.4 million increase in professional fees, a $1.9 million increase in depreciation and amortization and a $1.2 million increase in travel and business development. The increase in non-variable direct expenses were partially offset by a $15.5 million decline in bad debts, net of recoveries. Also, the decline in segment income was partially offset by a nonrecurring gain of $6.9 million related to proceeds from a settlement in a commodity exchange gold futures and options trading matter.
Beginning with the fiscal year ended September 30, 2024, we calculated an allocation for overhead costs of $35.6 million for the Commercial segment as described in the introduction to Total Segment Results above . An allocation of overhead costs was not calculated for historical comparable information.
Institutional
We provide institutional clients with a suite of equity trading services to help them find liquidity with best execution, consistent liquidity across a robust array of fixed income products, competitive and efficient clearing and execution in all major futures and securities exchanges globally as well as prime brokerage in equities and major foreign currency pairs and swap transactions. Additionally, we operate a comprehensive investment banking platform which provides both investment banking services and equity research.
Table of C ontents
The tables below present the financial performance, a disaggregation of operating revenues, and select operating data and metrics used by management in evaluating the performance of the Institutional segment, for the periods indicated.
Fiscal Year Ended September 30,
(in millions)
% Change
% Change
Revenues:
Sales of physical commodities
Principal gains, net
Commission and clearing fees
Consulting, management, and account fees
Interest income
Total revenues
Cost of sales of physical commodities
Operating revenues
Transaction-based clearing expenses
Introducing broker commissions
Interest expense
Net operating revenues
Variable compensation and benefits
Net contribution
Fixed compensation and benefits
Trading systems and market information
Professional fees
Non-trading technology and support
Selling and marketing
Travel and business development
Depreciation and amortization
Bad debts, net of recoveries
Shared services
Other fixed expenses
Total non-variable direct expenses
Other (loss) gain, net
Segment income
Allocation of overhead costs (1)
Segment income, less allocation of overhead costs
(1) Includes an allocation of certain overhead costs to our operating segments as noted above for the years ended September 30, 2025 and 2024. These allocations will be provided on an ongoing basis but have not been calculated for the year ended September 30, 2023.
Fiscal Year Ended September 30,
% Change
% Change
Operating Revenues (in millions):
Listed derivatives
Securities
FX contracts
Interest / fees earned on client balances
Other
Volumes and Other Select Data (all $ amounts are U.S. dollar equivalents):
Listed derivatives (contracts, 000’s) (1)
Listed derivatives, average rate per contract (2)
Average client equity - listed derivatives (millions) (1)
Securities ADV ( millions)
Securities RPM (3)
Average MM/FDIC sweep client balances (millions)
FX contracts ADV ( millions)
FX contracts RPM
n/m = not meaningful to present as a percentage
(1) The acquisition of RJO, effective July 31, 2025, contributed 15.9 million listed derivative contracts in the fiscal year ended September 30, 2025. Also, for the fiscal year ended September 30, 2025, the average client equity includes the effect of an incremental $3.3 billion per month from RJO for the two months post-acquisition.
(2) Give up fees, related to contract execution for clients of other FCMs, are excluded from the calculation of listed derivative, average rate per contract.
(3) Interest expense associated with our fixed income activities is deducted from operating revenues in the calculation of Securities RPM, while interest income related to securities lending is excluded.
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For information about the assets of this segment, see Note 22 to the Consolidated Financial Statements.
Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
Operating revenues increased $536.4 million, or 27%, to $2,498.5 million in the fiscal year ended September 30, 2025 compared to $1,962.1 million in the fiscal year ended September 30, 2024. Net operating revenues increased $226.5 million, or 36%, to $856.9 million in the fiscal year ended September 30, 2025 compared to $630.4 million in the fiscal year ended September 30, 2024.
Operating revenues derived from listed derivatives increased $50.8 million, principally driven by a 6% increase contract volumes, primarily as a result of the acquisition of RJO, as well as 12% increase in the average rate per contract. The acquired RJO business contributed $54.2 million in operating revenues derived from listed derivatives.
Operating revenues derived from securities transactions increased $375.9 million, principally driven by a 27% increase in the ADV of securities traded, primarily as a result of increased client activity in both equity and fixed income markets, as well as an 9% increase in securities RPM.
Operating revenues derived from FX contracts declined $3.8 million, principally driven by a 17% decline in the ADV of FX contracts traded as well as an 8% decline in the average rate per contract.
Finally, interest and fee income earned on client balances, which is associated with our listed derivative business, as well as our correspondent clearing businesses, increased $44.6 million, principally driven by increases of 26% and 21% in average client equity and average money market / FDIC sweep client balances, respectively, which was partially offset by a decline in short term interest rates. The increase in average client equity was partially driven by the acquisition of RJO, which added $3.3 billion in average client equity in each of the two months post-acquisition. The acquired RJO business contributed $33.3 million in interest and fee income earned on client balances.
Primarily as a result of the increase in Securities ADV, interest expense increased $259.8 million, with interest expense directly associated with serving as an institutional dealer in fixed income securities increasing $211.2 million, to $1,063.6 million and interest expense directly attributable to securities lending activities increasing $35.0 million to $99.3 million. Additionally, interest paid to clients increased $4.7 million to $116.3 million, as the acquired RJO business added $13.5 million, partially offset by a decrease in our Exchange-Traded Futures & Options business, excluding RJO.
Variable expenses, excluding interest, expressed as a percentage of operating revenues increased to 24% in the fiscal year ended September 30, 2025 compared to 23% in the fiscal year ended September 30, 2024.
Segment income increased $119.8 million, principally driven by the increase in net operating revenues noted above, which was partially offset by a $24.6 million increase in non-variable direct expenses, with $10.2 million of this increase attributable to the acquisition of RJO. Segment income in the fiscal year ended September 30, 2025 included a $2.3 million loss on the disposal of certain capitalized hardware expenditures, partially offset by a gain of $1.6 million related to proceeds received from class action settlements.
For the fiscal year ended September 30, 2025, we calculated an allocation for overhead costs of $59.8 million for the Institutional segment compared to a $52.4 million allocation in the fiscal year ended September 30, 2024.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
Operating revenues increased $448.5 million, or 30%, to $1,962.1 million in the fiscal year ended September 30, 2024 compared to $1,513.6 million in the fiscal year ended September 30, 2023. Net operating revenues increased $98.4 million, or 18%, to $630.4 million in the fiscal year ended September 30, 2024 compared to $532.0 million in the fiscal year ended September 30, 2023.
Operating revenues derived from listed derivatives increased $21.3 million, principally driven by a 39% increase in listed derivative contract volumes, which was partially offset by an 18% decline in the average rate per contract.
Operating revenues derived from securities transactions increased $368.5 million, principally driven by a 36% increase in the ADV of securities traded, primarily as a result of increased client activity in both equity and fixed income markets. The securities RPM decreased 15%, principally due to a tightening of spreads and a change in product mix.
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Operating revenues derived from FX contracts declined $4.8 million, principally driven by an 11% decline in the ADV of FX contracts traded, which was partially offset by an 8% increase in the average rate per contract.
Finally, interest and fee income earned on client balances, which is associated with our listed derivative business, as well as our correspondent clearing businesses, increased $29.7 million, principally driven by an increase in the short-term interest rates realized, which was partially offset by declines of 14% and 24% in average client equity and average MM/FDIC sweep client balances, respectively.
As a result of the increase in short-term interest rates and the increase in the ADV, interest expense increased $314.2 million, with interest expense directly associated with serving as an institutional dealer in fixed income securities increasing $295.7 million and interest expense directly attributable to securities lending activities increasing $24.9 million. Partially offsetting these increases, interest paid to clients decreased $20.8 million.
Variable expenses, excluding interest, expressed as a percentage of operating revenues declined to 23% in the fiscal year ended September 30, 2024 compared to 27% in the fiscal year ended September 30, 2023, principally as the result of the increase in interest/fees earned on client balances, which is generally not a component of variable compensation.
Segment income increased $48.1 million, principally driven by the increase in net operating revenues noted above, which was partially offset by a $28.6 million increase in non-variable direct expenses. The increase in non-variable direct expenses was primarily related to a $17.4 million increase in fixed compensation and benefits, a $2.3 million increase in trade systems and market information, a $6.8 million increase in professional fees and a $1.0 million increase in travel and business development. These increases were partially offset by a $1.8 million decline in non-trading technology and support as compared to the fiscal year ended September 30, 2023. Segment income in the fiscal year ended September 30, 2023, was favorably impacted by a nonrecurring gain related to proceeds received of $2.1 million resulting from an institutional-based foreign exchange antitrust class action settlement.
Beginning with the fiscal year ended September 30, 2024, we calculated an allocation for overhead costs of $52.4 million for the Institutional segment as described in the introduction to Total Segment Results above . An allocation of overhead costs was not calculated for historical comparable information.
Self-Directed/Retail
We provide our self-directed/retail clients around the world access to over 18,000 global financial markets, including spot foreign exchange ("forex"), as well as contracts for difference (“CFDs”), which are investment products with returns linked to the performance of underlying assets. In addition, our independent wealth management business offers a comprehensive product suite to retail investors in the U.S.
As noted in the beginning of this Segment Information section, the portion of our precious metals activities previously reported in this segment have been moved into and combined with our precious metals activities within our Commercial segment. All segment information has been revised to reflect all precious metals business within the Commercial segment retroactive to October 1, 2022.
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The tables below present the financial performance, a disaggregation of operating revenues, and select operating data and metrics used by management in evaluating the performance of the Self-Directed/Retail segment, for the periods indicated.
Fiscal Year Ended September 30,
(in millions)
% Change
% Change
Revenues:
Sales of physical commodities
Principal gains, net
Commission and clearing fees
Consulting, management, and account fees
Interest income
Total revenues
Cost of physical commodities sold
Operating revenues
Transaction-based clearing expenses
Introducing broker commissions
Interest expense
Net operating revenues
Variable compensation and benefits
Net contribution
Fixed compensation and benefits
Trading systems and market information
Professional fees
Non-trading technology and support
Selling and marketing
Travel and business development
Depreciation and amortization
Bad debts, net of recoveries
Shared services
Other fixed expenses
Total non-variable direct expenses
Other gain
Segment income
Allocation of overhead costs (1)
Segment income, less allocation of overhead costs
(1) Includes an allocation of certain overhead costs to our operating segments as noted above for the years ended September 30, 2025 and 2024. These allocations will be provided on an ongoing basis but have not been calculated for the fiscal year ended September 30, 2023.
The tables below reflect a disaggregation of operating revenues and select operating data and metrics used by management in evaluating performance of our Self-Directed/Retail segment for the periods indicated.
Fiscal Year Ended September 30,
% Change
% Change
Operating Revenues (in millions):
Securities
FX/CFD contracts
Interest / fees earned on client balances
Other
Select data (all $ amounts are U.S. dollar equivalents):
FX/CFD contracts ADV (millions)
FX/CFD contracts RPM
For information about the assets of this segment, see Note 22 to the Consolidated Financial Statements.
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Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
Operating revenues increased $15.9 million, or 4%, to $405.5 million in the fiscal year ended September 30, 2025 compared to $389.6 million in the fiscal year ended September 30, 2024. Net operating revenues increased $0.5 million to $281.6 million in the fiscal year ended September 30, 2025 compared to $281.1 million in the fiscal year ended September 30, 2024.
Operating revenues derived from FX/CFD contracts increased $0.2 million, principally due to an 18% increase in FX/CFD contracts ADV, which was mostly offset by an 15% decline in FX/CFD contracts RPM.
Operating revenues derived from securities transactions, which are related to our independent wealth management activities, increased $15.0 million, principally due to increased management fees.
Interest and fee income earned on client balances decreased $0.3 million versus the prior year, primarily due to a decline in short term interest rates.
Variable expenses, excluding interest, expressed as a percentage of operating revenues increased to 32% in the fiscal year ended September 30, 2025 compared to 31% in the fiscal year ended September 30, 2024.
Segment income increased $13.8 million, principally due to a $3.6 million decline in variable direct compensation and benefits and a $6.1 million decline in non-variable direct expenses. The decline in non-variable direct expenses was primarily driven by a $10.7 million decline in fixed compensation and benefits, which was partially driven by the move of certain development and marketing teams to a centralized shared services model within overheads. Subsequently, a portion of these costs have been directly allocated to this segment through a shared service fee, which increased $1.8 million as compared to the prior year. Segment income was favorably impacted by a class action settlements received of $5.5 million and $1.9 million in the fiscal year ended September 30, 2025 and 2024, respectively.
For the fiscal year ended September 30, 2025, we calculated an allocation for overhead costs of $50.5 million for the Self-Directed/Retail segment compared to a $47.1 million allocation in the fiscal year ended September 30, 2024.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
Operating revenues increased $68.6 million, or 21%, to $389.6 million in the fiscal year ended September 30, 2024 compared to $321.0 million in the fiscal year ended September 30, 2023. Net operating revenues increased $65.3 million, or 30%, to $281.1 million in the fiscal year ended September 30, 2024 compared to $215.8 million in the fiscal year ended September 30, 2023.
Operating revenues derived from FX/CFD contracts increased $59.0 million, principally due to a 37% increase in FX/CFD contracts RPM, which was primarily driven by increased client activity in gold, oil and index contracts, which typically have a higher RPM than FX contracts. This increase was partially offset by an 8% decline in FX/CFD contracts ADV, primarily related to a decline in client activity in FX markets.
Operating revenues derived from securities transactions, which are related to our independent wealth management activities, increased $10.2 million.
Interest and fee income earned on client balances was $2.7 million in the fiscal year ended September 30, 2024 as compared to $3.0 million in the fiscal year ended September 30, 2023.
Variable expenses, excluding interest, as a percentage of operating revenues were 31% in the fiscal year ended September 30, 2024 compared to 35% in the fiscal year ended September 30, 2023, principally due to the increase in operating revenues derived from FX/CFD contracts which typically incur a lower relative percentage of variable expenses than do our other revenue streams within this segment.
Segment income increased $79.5 million, principally due to the increase in net operating revenues noted above as well as a $17.2 million, or 10%, decline in non-variable direct expenses. The decline in non-variable direct expenses was partially driven by a $4.2 million decline in depreciation and amortization, as certain intangibles, recognized as part the acquisition of Gain Capital Holdings, Inc. in fiscal 2020, became fully amortized during fiscal 2023, partially offset by an increase in amortization of capitalized software development for post-acquisition software placed into service. In addition, the decline in non-variable expenses was driven by a $6.1 million decline in direct selling and marketing costs, a $3.0 million decline in fixed compensation and benefits and a $1.8 million decrease in bad debts.
Beginning with the fiscal year ended September 30, 2024, we calculated an allocation for overhead costs of $47.1 million for the Self-Directed/Retail segment as described in the introduction to Total Segment Results above . An allocation of overhead costs was not calculated for historical comparable information.
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Payments
We provide customized foreign exchange and treasury services to banks and commercial businesses, charities, non-governmental organizations, as well as governmental organizations. We provide transparent pricing and offer payments services in more than 180 countries and 140 currencies, which we believe is more than any other payments solutions provider.
The tables below present the financial performance, a disaggregation of operating revenues, and select operating data and metrics used by management in evaluating the performance of the Payments segment for the periods indicated.
Fiscal Year Ended September 30,
(in millions)
% Change
% Change
Revenues:
Sales of physical commodities
Principal gains, net
Commission and clearing fees
Consulting, management, account fees
Interest income
Total revenues
Cost of sales of physical commodities
Operating revenues
Transaction-based clearing expenses
Introducing broker commissions
Interest expense
Net operating revenues
Variable compensation and benefits
Net contribution
Fixed compensation and benefits
Trading systems and market information
Professional fees
Non-trading technology and support
Selling and marketing
Travel and business development
Depreciation and amortization
Bad debts, net of recoveries
Shared services
Other fixed expenses
Total non-variable direct expenses
Other gain
Segment income
Allocation of overhead costs (1)
Segment income, less allocation of overhead costs
(1) Includes an allocation of certain overhead costs to our operating segments as noted above for the years ended September 30, 2025 and 2024. These allocations will be provided on an ongoing basis but have not been calculated for the year ended September 30, 2023.
Fiscal Year Ended September 30,
% Change
% Change
Operating Revenues (in millions):
Payments
Other
Select data (all $ amounts are U.S. dollar equivalents):
Payments ADV (millions)
Payments RPM
For information about the assets of this segment, see Note 22 to the Consolidated Financial Statements.
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Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
Operating revenues increased $4.2 million, or 2%, to $213.8 million in the fiscal year ended September 30, 2025 compared to $209.6 million in the fiscal year ended September 30, 2024. Net operating revenues increased $2.7 million, or 1%, to $202.2 million in the fiscal year ended September 30, 2025 compared to $199.5 million in the fiscal year ended September 30, 2024.
The increase in operating revenues was principally driven by a 16% increase in the ADV, which was partially offset by an 11% decline in RPM traded.
Variable expenses, excluding interest, expressed as a percentage of operating revenues were 22% in both the fiscal year ended September 30, 2025 and 2024.
Segment income increased $4.2 million, primarily as a result of the increase in operating revenues noted above.
For the fiscal year ended September 30, 2025, we calculated an allocation for overhead costs of $22.6 million for the Payments segment compared to a $20.9 million allocation in the fiscal year ended September 30, 2024.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
Operating revenues decreased $3.0 million, or 1%, to $209.6 million in the fiscal year ended September 30, 2024 compared to $212.6 million in the fiscal year ended September 30, 2023. Net operating revenues decreased $3.8 million, or 2%, to $199.5 million in the fiscal year ended September 30, 2024 compared to $203.3 million in the fiscal year ended September 30, 2023.
The decline in operating revenues was principally driven by a 5% decline in RPM traded, which was partially offset by a 3% increase in the ADV.
Variable expenses, excluding interest, expressed as a percentage of operating revenues were 22% in the fiscal year ended September 30, 2024 as compared to 23% in the fiscal year ended September 30, 2023.
Segment income increased $3.5 million, principally driven by a $5.5 million decline in non-variable direct expenses, which was partially offset by the decline in net operating revenues noted above. The decline in non-variable direct expenses was primarily driven by an $8.0 million decrease in fixed compensation and benefits as severance declined $10.6 million, partially offset by higher salaries related to increased headcount. The fiscal year ended September 30, 2023 included $10.0 million in severance related to a reorganization of the business.
Beginning with the fiscal year ended September 30, 2024, we calculated an allocation for overhead costs of $20.9 million for the Payments segment as described in the introduction to Total Segment Results above . An allocation of overhead costs was not calculated for historical comparable information.
Overhead Costs
We incur overhead and global operational costs and expenses, including certain shared services such as information technology, accounting and treasury, credit and risk, legal and compliance, human resources, certain global operations and other activities.
The following table provides information regarding our overhead costs and expenses. The information in the table below has been reclassified to reflect certain global operations costs on a gross basis, as well as the amount of shared services reimbursement through charges to business segments, retroactive to October 1, 2022. This reclassification has not resulted in any changes to the total compensation and other expenses amounts previously reported.
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In addition, for the year ended September 30, 2025 and 2024, the table provides information regarding the allocation of a portion of these costs to the aforementioned operating segments. The allocation of overhead costs to operating segments includes costs associated with compliance, technology, and credit and risk costs. The share of allocated costs is based on resources consumed by the relevant businesses. In addition, the allocation of human resources and occupancy costs is principally based on employee costs within the relevant businesses.
Fiscal Year Ended September 30,
(in millions)
% Change
% Change
Compensation and benefits:
Variable compensation and benefits
Fixed compensation and benefits
Other expenses:
Occupancy and equipment rental
Non-trading technology and support
Professional fees
Depreciation and amortization
Communications
Selling and marketing
Trading systems and market information
Travel and business development
Other
Overhead costs, before shared services
Shared services
Overhead costs, net of shared services
Allocation of overhead costs (1)
Overhead costs, net of shared services, net of allocation to operating segments
(1) Includes an allocation of certain overhead costs to our operating segments as noted above for the years ended September 30, 2025 and 2024. An allocation was not calculated for the year ended September 30, 2023.
Year Ended September 30, 2025 Compared to Year Ended September 30, 2024
The increase in non-variable compensation was partially related to a reorganization of our IT and centralized marketing personnel, including the move of certain development and marketing teams out of discrete business lines and into centralized shared services, resulting in increased compensation expense in overhead, and lower compensation expense in the discrete business lines, which were partially offset with non-variable charges to the business lines based on use of IT and marketing resources. Additionally, the increase in non-variable compensation was impacted by an increase in headcount, as well as the impact of annual merit increases. Share-based compensation expense increased principally due to the issuance of additional stock option awards during December 2024. Incremental cost from acquisitions completed during the fiscal year ended September 30, 2025 added $10.6 million of non-variable compensation expense.
Fixed compensation and benefits for the year ended September 30, 2025 and 2024 included, in aggregate, $6.6 million and $4.5 million, respectively, related to severance, accelerated long-term incentive and accelerated share-based compensation due to the departure of two executive officers.
Non-trading technology and support increased $14.3 million, principally due to higher non-trading software maintenance and support costs related to various IT systems technologies, driven by increased headcount. Non-trading technology and support costs related to the activities of RJO added an incremental $1.9 million of increased expenses.
Professional fees increased $16.0 million, principally due to investment banking fees related to the closing of the RJO acquisition, as well as higher legal fees related to our defense in various legal matters, net of recoveries, and increased merger and acquisition activity during the fiscal year ended September 30, 2025. Incremental cost from acquired entities completed during the fiscal year ended September 30, 2025 added $0.8 million of expense.
Travel and business development increased $3.1 million, principally due to higher transportation and lodging costs. This increase is also partially related to the reorganization of certain IT personnel discussed above.
Year Ended September 30, 2024 Compared to Year Ended September 30, 2023
For a discussion of changes for the year ended September 30, 2024 compared to the Year Ended September 30, 2023 refer to the Annual Report on Form 10-K filed with the SEC on November 29, 2024.
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Liquidity, Financial Condition and Capital Resources
Overview
Liquidity is our ability to generate sufficient funding to meet all of our cash needs. Liquidity is of critical importance to us and imperative to maintaining our operations on a daily basis. Senior management establishes liquidity and capital policies, which we monitor and review for funding from both internal and external sources. We evaluate how effectively our policies support our operations, issuing debt and equity securities, and accessing committed credit facilities. Liquidity and capital matters are reported regularly to our Board of Directors.
Regulatory
StoneX Financial Inc. and R.J. O’Brien and Associates LLC are both registered as an futures commission merchant with the CFTC and NFA, and members of various commodities and futures exchanges in the U.S. and abroad. StoneX Financial Inc. and R.J. O’Brien and Associates LLC have responsibilities to meet margin calls at all exchanges on a daily basis, and even on an intra-day basis, if deemed necessary by relevant regulators or exchanges. We require our clients to make margin deposits the next business day, and we require our largest clients to make intra-day margin payments during periods of significant price movement. Margin required to be posted to the exchanges is a function of our clients’ net open positions and required margin per contract. StoneX Financial Inc. and R.J. O’Brien and Associates LLC are subject to minimum capital requirements under Section 4(f)(b) of the Commodity Exchange Act, Part 1.17 of the rules and regulations of the CFTC. In addition, StoneX Financial Inc. is registered as a broker-dealer with the SEC and is a member of both FINRA and MSRB. StoneX Financial Inc. is also subject to the SEC Uniform Net Capital Rule 15c3-1 under the Securities Exchange Act of 1934, as amended (“the Exchange Act”) and Rule 15c3-3 of the Exchange Act (“Customer Protection Rule”).
Gain Capital Group, LLC is registered as both a futures commission merchant and registered foreign exchange dealer, subject to minimum capital requirements under Section 4(f)(b) of the Commodity Exchange Act, Part 1.17 of the rules and regulations of the CFTC and NFA Financial Requirements, Sections 1 and 11.
StoneX Markets LLC is a CFTC registered swap dealer, whose business is overseen by the NFA. The CFTC imposes rules over net capital requirements, as well as the exchange of initial margin between registered swap dealers and certain counterparties.
These rules specify the minimum amount of capital that must be available to support our clients’ account balances and open trading positions, including the amount of assets that StoneX Financial Inc., R.J. O’Brien and Associates, LLC, Gain Capital Group, LLC and StoneX Markets LLC must maintain in relatively liquid form. Further, the rules are designed to maintain general financial integrity and liquidity.
The Benchmark Company LLC is a registered as a broker-dealer with the SEC and is a member of FINRA.
StoneX Financial Ltd is regulated by the FCA, the regulator of investment and payment firms in the U.K. as a MiFID investment firm under U.K. law, and is subject to regulations which impose regulatory capital requirements. In Europe, our regulated subsidiaries are subject to E.U. regulation. Across the U.K. and E.U., the respective transpositions of the Market Abuse Regulation, and the General Data Protection Regulation, also apply. StoneX Financial Ltd is a member of various commodities, futures, and securities exchanges in the U.K. and Europe and has the responsibility to meet margin calls at all exchanges on a daily basis and intra-day basis, as necessary. StoneX Financial Ltd is required to be compliant with the U.K.’s regulation for capital liquidity, and CASS regulation for client money and safeguarding. To comply with these liquidity regulations, we have implemented daily liquidity procedures, conduct periodic reviews of liquidity by stressed scenarios, and are required to maintain enough liquidity for the firm to survive for one year under the appropriate stressed conditions.
R.J. O’Brien Limited is regulated by the FCA. The regulations impose regulatory capital, as well as conduct of business, governance, and other requirements. The conduct of business rules include those that govern the treatment of client money and other assets which, under certain circumstances, for certain classes of client, must be segregated from the firm’s own assets.
R.J. O’Brien (MENA) Capital Limited is registered with the Dubai International Financial Centre (“DIFC”) and regulated by the Dubai Financial Services Authority (“DFSA”). R.J. O’Brien (MENA) Capital Limited has been granted a prudential “Category 3A” license by the DFSA, and is engaged in the business of dealing in investments as principal (limited to deals undertaken on a matched principle basis only), dealing in investments as agent, arranging custody, arranging deals in investments and advising on financial products.
StoneX Financial Pte. Ltd. is regulated by the Monetary Authority of Singapore (“MAS”) and operates as an approved holder of a Capital Market Services and a Payments Service License. StoneX Financial Pte. Ltd. is subject to the requirements of MAS pursuant to the Securities and Futures Act and the Payments Services Act 2019. The regulations include those that govern the treatment of client money and other assets which under certain circumstances must be segregated from the firm’s own assets.
The regulations discussed above limit funds available for dividends to us. As a result, we may be unable to access our operating subsidiaries’ funds when we need them.
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In our physical commodities trading, commercial hedging OTC, securities and foreign exchange trading activities, we may be required to meet margin calls with various counterparties based upon the underlying open transactions we have in place with those counterparties.
We review our overall credit and capital needs to determine whether our capital base, both stockholders’ equity and debt, as well as available credit facilities, can appropriately support the anticipated financing needs of our operating subsidiaries.
As of September 30, 2025, we had total equity of $2,377.4 million, outstanding loans under revolving credit facilities and other payables to lenders of $782.0 million and $1,159.0 million outstanding on our senior secured notes, net of deferred financing costs.
A substantial portion of our assets are liquid. As of September 30, 2025, approximately 97% of our assets consisted of cash and cash equivalents; securities purchased under agreements to resell; securities borrowed; deposits with and receivables from broker-dealers, clearing organizations and counterparties; receivables from clients; financial instruments owned, at fair value; and physical commodities inventory. All assets that are not client and counterparty deposit financed are financed by our equity capital, bank loans, short-term borrowings from financial instruments sold, not yet purchased and under repurchase agreements, securities loaned and other payables.
Client and Counterparty Credit and Liquidity Risk
Our operations expose us to credit risk of default of our clients and counterparties. The risk includes liquidity risk to the extent our clients or counterparties are unable to make timely payment of margin or other credit support. We are indirectly exposed to the financing and liquidity risks of our clients and counterparties, including the risks that our clients and counterparties may not be able to finance their operations.
As a clearing broker, we act on behalf of our clients for all trades consummated on exchanges. We must pay initial and variation margin to the exchanges, on a net basis, before we receive the required payments from our clients. Accordingly, we are responsible for our clients’ obligations with respect to these transactions, which exposes us to significant credit risk. Our clients are required to make any margin deposits the next business day, and we require our largest clients to make intra-day margin payments during periods of significant price movement. Our clients are obligated to maintain initial margin requirements at the level set by the respective exchanges, but we have the ability to increase margin requirements for clients based on their open positions, trading activity, or market conditions.
As it relates to OTC derivative transactions, we act as a principal, which exposes us to the credit risk of both our clients and the counterparties with which we offset our client positions. As with exchange-traded transactions, our OTC transactions require that we meet initial and variation margin payments on behalf of our clients before we receive related required payments from our clients. OTC clients are required to post sufficient collateral to meet margin requirements based on value-at-risk models, as well as variation margin requirements based on the price movement of the commodity or security in which they transact. Our clients are required to make any margin deposits the next business day, and we may require our largest clients to make intra-day margin payments during periods of significant price movement. In this business as well, we have the ability to increase the margin requirements for clients based on their open positions, trading activity, or market conditions. On a limited basis, we provide credit thresholds to certain clients, based on internal evaluations and monitoring of client creditworthiness.
In addition, with OTC transactions, we are at risk that a counterparty will fail to meet its obligations to us when due. We would then be exposed to the risk that the settlement of a transaction which is due from a client will not be collected from the respective counterparty with which the transaction was offset. We monitor the credit quality of our respective counterparties and mark our positions held with each counterparty to market on a daily basis.
We enter into securities purchased under agreements to resell, securities sold under agreements to repurchase, securities borrowed and securities loaned transactions to, among other things, finance financial instruments, acquire securities to cover short positions, acquire securities for settlement, and to accommodate counterparties’ needs. In connection with these agreements and transactions, it is our policy to receive or pledge cash or securities to adequately collateralize such agreements and transactions in accordance with general industry guidelines and practices. The collateral is valued daily and we may require counterparties to deposit additional collateral or return collateral pledged, when appropriate.
Primary Sources and Uses of Cash
Our cash and cash equivalents and client cash and securities held for clients are held at banks, deposits at liquidity providers, investments in money market funds that invest in highly liquid investment grade securities including U.S. treasury bills, as well as investments in U.S treasury bills. In general, we believe all of our investments and deposits are of high credit quality and we have more than adequate liquidity to conduct our businesses.
Our assets and liabilities may vary significantly from period to period due to changing client requirements, economic and market conditions and our growth. Our total assets as of September 30, 2025 and 2024, were $45,268.0 million and $27,466.3
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million, respectively. Our operating activities generate or utilize cash as a result of net income or loss earned or incurred during each period and fluctuations in our assets and liabilities. The most significant fluctuations arise from changes in the level of client activity, commodities prices, and changes in the balances of financial instruments and commodities inventory. StoneX Financial Inc., R.J. O’Brien and Associates LLC, and StoneX Financial Ltd occasionally utilize their margin line credit facilities, on a short-term basis, to meet intraday settlements with the commodity exchanges prior to collecting margin funds from their clients.
The majority of the assets of StoneX Financial Inc., StoneX Financial Ltd, StoneX Financial Pte. Ltd, StoneX Markets LLC, Gain Capital Group, LLC, R.J. O’Brien & Associates, LLC, and R.J. O’Brien Limited are restricted from being transferred to us or other affiliates due to specific regulatory requirements. This restriction has no current impact on our ability to meet our cash obligations, and no such impact is expected in the future.
We have liquidity and funding policies and processes in place that are intended to maintain sufficient flexibility to address both company-specific and industry liquidity needs. The majority of our excess funds are held with high-quality institutions, under highly-liquid reverse repurchase agreements, U.S. government obligations, interest earning cash deposits and AA-rated money market investments.
We do not intend to distribute earnings of our foreign subsidiaries in a taxable manner, and therefore intend to limit distributions to earnings previously taxed in the U.S., or earnings that would qualify for the 100 percent dividends received deduction, and earnings that would not result in any significant foreign taxes. We repatriated $73.5 million and $100.0 million for the fiscal year ended September 30, 2025 and 2024, respectively, of earnings previously taxed in the U.S. resulting in no significant incremental taxes. Therefore, the Company has not recognized a deferred tax liability on its investment in foreign subsidiaries.
Senior Secured Notes
On March 1, 2024, we issued $550.0 million in aggregate principal amount of the Notes due 2031, which are fully and unconditionally guaranteed, jointly and severally, on a senior secured second lien basis, by certain subsidiaries of the Company that guarantee the Company’s senior committed credit facility and certain of its domestic subsidiaries.
The Notes due 2031 will mature on March 1, 2031. Interest on the Notes due 2031 accrues at a rate of 7.875% per annum and is payable semiannually in arrears on September 1 and March 1 of each year. We incurred debt issuance costs of $7.6 million in connection with the issuance of the Notes due 2031, which are being amortized over the term of the notes.
On July 8, 2025, we issued $625.0 million in aggregate principal amount of the Notes due 2032, which are fully and unconditionally guaranteed, jointly and severally, on a senior secured second lien basis, by certain subsidiaries of the Company that guarantee the Company’s senior committed credit facility and certain of its domestic subsidiaries. The Notes due 2032 will mature on July 15, 2032. Interest on the Notes due 2032 accrues at a rate of 6.875% per annum and is payable semiannually in arrears on January 15 and July 15 of each year, commencing on January 15, 2026. On July 31, 2025, the net proceeds from the issuance of the Notes due 2032 were used to fund the cash portion of the purchase price of the RJO acquisition and to pay related fees and expenses.
The Indentures governing our senior secured notes contain covenants that limit, among other things, our ability to (1) transfer and sell assets; (2) pay dividends or distributions on our capital stock, repurchase our capital stock, make payments on subordinated indebtedness and make certain investments; (3) incur additional debt; (4) create or incur liens on our assets; (5) create any restriction on the ability of any of our restricted subsidiaries to pay dividends, make loans to us or any of our restricted subsidiaries or sell assets to us or any of our restricted subsidiaries; (6) merge, amalgamate or consolidate with another company; and (7) enter into transactions with affiliates. These covenants are subject to a number of important limitations, qualifications and exceptions. In addition, the Indentures provide for customary events of default (subject in certain cases to customary grace and cure periods), which include nonpayment; failure to comply with redemption and repurchase provisions; failure to comply with the agreements in any of the indentures, notes and related guarantees and security agreements; payment defaults or acceleration of other material indebtedness; failure to pay certain judgments; unenforceability, repudiation, denial or disaffirmation of obligations of certain subsidiaries; and certain events of bankruptcy and insolvency. In addition, upon the occurrence of a Change of Control (as defined in the indentures), each holder of the notes will have the right to require us to make an offer to repurchase all or a portion of the notes in cash at a price equal to 101% of the aggregate principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, thereon to the date of repurchase.
Committed Credit Facilities
As of the date of this report, we had various committed bank credit facilities, totaling $1,705.0 million, of which $621.8 million was outstanding as of September 30, 2025. Additional information regarding the committed bank credit facilities can be found in Note 11 of the Consolidated Financial Statements. The credit facilities include:
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• A first-lien senior secured syndicated loan facility committed until June 3, 2028 under which $650.0 million is available to us for general working capital requirements and capital expenditures.
• An unsecured line of credit committed until October 27, 2026, under which $325.0 million is available to our wholly owned subsidiary, StoneX Financial Inc. to provide short term funding.
• A syndicated borrowing facility committed until July 29, 2026, under which $325.0 million is available to our wholly owned subsidiary, StoneX Commodity Solutions LLC (“StoneX Commodity Solutions”) to facilitate physical commodity trade and provide marketing, procurement, logistics and price management services to clients across the commodity complex.
• A subordinated credit facility which allows our subsidiary, R.J. O’Brien & Associates, LLC, to borrow up to $180.0 million. As of September 30, 2025, the outstanding tranches of borrowings mature at various dates through July 14, 2026. The facility matures in April 2027, at which point no further draws can be made. The subordinated credit facility complies with the applicable regulatory requirements, and the borrowings are available for computing net capital under the CFTC’s net capital rule for R.J. O’Brien & Associates, LLC.
• An unsecured syndicated loan facility committed until October 6, 2026, under which our subsidiary, StoneX Financial Ltd is entitled to borrow up to $175.0 million, subject to certain terms and conditions of the credit agreement. This facility is intended to provide short-term funding.
• An unsecured revolving credit facility committed until September 4, 2026, under which $15.0 million is available to our wholly owned subsidiary, StoneX Financial Pte. Ltd. for general working capital requirements .
In October 2025, we added a secured loan facility committed until October 1, 2026, under which our subsidiary, Right Company LLC is entitled to borrow up to $15.0 million, subject to certain terms and conditions of the credit agreement to facilitate physical commodity trade.
Our facility agreements contain certain financial covenants relating to financial measures on a consolidated basis, as well as on a stand-alone basis for certain subsidiaries, including minimum tangible net worth, minimum regulatory capital, minimum net unencumbered liquid assets, maximum net loss, minimum fixed charge coverage ratio and maximum funded debt to net worth ratio. Failure to comply with any such covenants could result in the debt becoming payable on demand. As of September 30, 2025, we and our subsidiaries were in compliance with all of our financial covenants under the outstanding facilities.
In accordance with required disclosure as part of our first-lien senior secured syndicated loan facility, during the trailing twelve months ended September 30, 2025, interest expense directly attributable to trading activities includes $1,063.6 million in connection with trading activities conducted as an institutional dealer in fixed income securities, and $99.3 million in connection with securities lending activities.
As reflected above, certain of our committed credit facilities are scheduled to expire during the next twelve months following the year ended September 30, 2025. We intend to renew or replace all of our facilities as they expire, and based on our liquidity position and capital structure, we believe we will be able to do so.
Uncommitted Credit Facilities
We have access to certain uncommitted financing agreements that support our ordinary course securities and commodities inventories. The agreements are subject to certain borrowing terms and conditions. As of September 30, 2025 and September 30, 2024, the Company had $153.9 million and $104.9 million total borrowings outstanding under these uncommitted credit facilities, respectively.
Other Capital Considerations
Our activities are subject to various significant governmental regulations and capital adequacy requirements, both in the U.S. and in the international jurisdictions in which we operate. Our subsidiaries are in compliance with all of their capital regulatory requirements as of September 30, 2025. Additional information on our subsidiaries subject to significant net capital and minimum net capital requirements can be found in Note 21 of the Consolidated Financial Statements.
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Cash Flows
We include client cash and securities that meet the short-term requirement for cash classification to be segregated for regulatory purposes in our Consolidated Statements of Cash Flows. We hold a significant amount of U.S. Treasury obligations and U.S. government agency obligations, which represent investments of client funds or client-owned investments pledged in lieu of cash margin. U.S. Treasury or securities or government agency obligations held with third-party banks or pledged with exchange-clearing organizations representing investments of client funds or which are held for particular clients in lieu of cash margin are included in the beginning and ending cash balances reconciled on our Consolidated Statements of Cash Flows to the extent that they have an original or acquired maturity of 90 days or less and, therefore, meet the definition of a segregated cash equivalent. Purchases and sales of securities representing investment of clients’ funds and securities pledged or redeemed by particular clients in lieu of cash margin are presented as operating uses and sources of cash, respectively, within the operating section of the Consolidated Statements of Cash Flows if they have an original or acquired maturity of greater than 90 days. Typically, there is an offsetting use or source of cash related to the change in the payables to clients. However, we will report a use of cash in periods where segregated securities that meet the aforementioned definition of a segregated cash equivalent mature and are replaced with securities that have acquired maturities that are greater than 90 days.
Our cash, segregated cash, cash equivalents, and segregated cash equivalents increased by $4,847.6 million from $6,672.6 million as of September 30, 2024 to $11,520.2 million as of September 30, 2025. Net cash of $4,388.3 million was provided by operating activities, including movements typical of our operations, with large changes coming from payables to clients, securities sold under agreements to repurchase, financial instruments owned, securities purchased under agreements to resell, securities borrowed and loaned, as well as securities purchased and securities sold.
Net cash provided by financing activities during the fiscal year ended September 30, 2025 included significant inflows related to the Notes due 2032, which resulted in an inflow of $625.0 million, and inflows primarily related to our revolving credit facility, of $317.4 million. We did not repurchase any of our outstanding common stock during the years ended September 30, 2025 and September 30, 2024.
In the broker-dealer and related trading industries, companies report trading activities in the operating section of the statement of cash flows. Due to the daily price volatility in the commodities market, as well as changes in margin requirements, fluctuations in the balances of deposits held at various exchanges, marketable securities and client commodity accounts may occur from day-to-day. A use of cash, as calculated on the consolidated statement of cash flows, includes unrestricted cash transferred and pledged to the exchanges or guaranty funds. These funds are held in interest-bearing deposit accounts at the exchanges, and based on daily exchange requirements, may be withdrawn and returned to unrestricted cash. Additionally, within our unregulated OTC and foreign exchange operations, cash deposits received from clients are reflected as cash provided from operations. Subsequent transfer of these cash deposits to counterparties or exchanges to margin their open positions will be reflected as an operating use of cash to the extent the transfer occurs in a different period than the cash deposit was received.
Unrealized gains and losses on open positions revalued at prevailing foreign currency exchange rates are included in trading revenue but have no direct impact on cash flow from operations. Similarly, gains and losses become realized when client transactions are liquidated, although they do not affect cash flow. To some extent, the amount of net deposits made by our clients in any given period is influenced by the impact of gains and losses on our client balances, such that clients may be required to post additional funds to maintain open positions or may choose to withdraw excess funds on open positions.
We evaluate opportunities to expand our business. Investing activities included $65.4 million in capital expenditures for property and equipment and the capitalization of internally developed software during the fiscal year ended September 30, 2025 compared to $65.2 million during the fiscal year ended September 30, 2024 and $46.9 million during the fiscal year ended September 30, 2023. Capital expenditures over the past three years have primarily included software development, core information technology hardware acquisitions, and leasehold improvements on office space.
Investing activities include $392.1 million in cash payments for the acquisition of assets and businesses during the fiscal year ended September 30, 2025 compared to $2.3 million during the fiscal year ended September 30, 2024 and $6.1 million during the fiscal year ended September 30, 2023. Further information about business acquisitions is contained in Note 20 to the Consolidated Financial Statements.
See Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity for information related to the authorization provided by our Board of Directors to repurchase our outstanding common stock.
Apart from what has been disclosed above, there are no known trends, events or uncertainties that have had or are likely to have a material impact on our liquidity, financial condition and capital resources.
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Contractual Obligations
The following table summarizes our cash payment obligations as of September 30, 2025:
Payments Due by Period
(in millions)
Total
Less than 1 year
1 - 3 Years
3 - 5 Years
After 5 Years
Operating lease obligations
Purchase obligations (1)
Payable to lenders under loans
Senior secured borrowings
Deferred acquisition consideration
Other
(1) Represents an estimate of contractual purchase commitments in the ordinary course of business primarily for the purchase of precious metals and agricultural and energy commodities. Unpriced contract commitments have been estimated using September 30, 2025 market values. The purchase commitments for less than one year will be partially offset by corresponding sales commitments of $147,941.2 million .
Total contractual obligations exclude defined benefit pension obligations. We comply with the minimum funding requirements, and accordingly contributed $0.1 million to our defined benefit pension plans during the year ended September 30, 2025. During the year ending September 30, 2025, we anticipate making future benefit payments of $2.0 million related to the defined benefit plans. Additional information on the funded status of these plans can be found in Note 17 of the Consolidated Financial Statements.
Based on our current operations, we believe that cash flow from operations, available cash and available borrowings under our credit facilities will be adequate to meet our future liquidity needs.
Off Balance Sheet Arrangements
We are party to certain financial instruments with off-balance sheet risk in the normal course of business as a registered securities broker-dealer, futures commission merchant, U.K. based investment firm, provisionally registered swap dealer and from our market-making and proprietary trading in the foreign exchange and commodities and debt securities markets. These financial instruments include futures, forward and foreign exchange contracts, exchange-traded and OTC options, To Be Announced (“TBA”) securities and interest rate swaps. Derivative financial instruments involve varying degrees of off-balance sheet market risk whereby changes in the fair values of underlying financial instruments may result in changes in the fair value of the financial instruments in excess of the amounts reflected in the Consolidated Balance Sheets. Exposure to market risk is influenced by a number of factors, including the relationships between the financial instruments and our positions, as well as the volatility and liquidity in the markets in which the financial instruments are traded. The principal risk components of financial instruments include, among other things, interest rate volatility, the duration of the underlying instruments and changes in commodity pricing and foreign exchange rates. We attempt to manage our exposure to market risk through various techniques. Aggregate market limits have been established and market risk measures are routinely monitored against these limits. Derivative contracts are traded along with cash transactions because of the integrated nature of the markets for such products. We manage the risks associated with derivatives on an aggregate basis along with the risks associated with our proprietary trading and market-making activities in cash instruments as part of our firm-wide risk management policies.
A significant portion of these instruments are primarily the execution of orders for commodity futures and options on futures contracts on behalf of our clients, substantially all of which are transacted on a margin basis. Such transactions may expose us to significant credit risk in the event margin requirements are not sufficient to fully cover losses which clients may incur. We control the risks associated with these transactions by requiring clients to maintain margin deposits in compliance with both clearing organization requirements and internal guidelines. We monitor required margin levels daily and, therefore, may require clients to deposit additional collateral or reduce positions when necessary. We also establish contract limits for clients, which are monitored daily. We evaluate each client’s creditworthiness on a case-by-case basis. Clearing, financing, and settlement activities may require us to maintain funds with or pledge securities as collateral with other financial institutions. Generally, these exposures to exchanges are subject to netting of open positions and collateral, while exposures to clients are subject to netting, per the terms of the client agreements, which reduce the exposure to us by permitting receivables and payables with such clients to be offset in the event of a client default. Management believes that the margin deposits held as of September 30, 2025 are adequate to minimize the risk of material loss that could be created by positions held at that time. Additionally, we monitor collateral fair value on a daily basis and adjust collateral levels in the event of excess market exposure. Generally, these exposures to both counterparties and clients are subject to master netting agreements and the terms of the client agreements, which reduce our exposure.
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As a broker-dealer in U.S. Treasury obligations, U.S. government agency obligations, agency mortgage-backed obligations, and asset-backed obligations, we are engaged in various securities trading, borrowing and lending activities serving solely institutional counterparties. Our exposure to credit risk associated with the non-performance of counterparties in fulfilling their contractual obligations pursuant to these securities transactions and market risk associated with the sale of securities not yet purchased can be directly impacted by volatile trading markets which may impair the counterparties’ ability to satisfy outstanding obligations to us. In the event of non-performance and unfavorable market price movements, we may be required to purchase or sell financial instruments, which may result in a loss to us.
We transact OTC and foreign exchange contracts with our clients, and our OTC and foreign exchange trade desks will generally offset the client’s transaction simultaneously with one of our trading counterparties or will offset that transaction with a similar, but not identical, position on the exchange. These unmatched transactions are intended to be short-term in nature and are conducted to facilitate the most effective transaction for our client.
Additionally, we hold futures and options on futures contracts resulting from market-making and proprietary trading activities in these product lines. We assist clients in our commodities trading business to protect the value of their future production (precious or base metals) by selling them put options on an OTC basis. We also provide our physical commodities trading business clients with sophisticated option products, including combinations of buying and selling puts and calls. We mitigate our risk by effecting offsetting options with market counterparties or through the purchase or sale of exchange-traded commodities futures. The risk mitigation of offsetting options is not within the documented hedging designation requirements of the Derivatives and Hedging Topic of the ASC.
As part of the activities discussed above, we carry short positions. We sell financial instruments that we do not own, borrow the financial instruments to make good delivery, and therefore are obliged to purchase such financial instruments at a future date in order to return the borrowed financial instruments. We record these obligations in the consolidated financial statements as of September 30, 2025 and 2024, at fair value of the related financial instruments, totaling $2,919.8 million and $2,853.3 million, respectively. These positions are held to offset the risks related to financial assets owned, and reported in our Consolidated Balance Sheets in Financial instruments owned, at fair value , and Physical commodities inventory, net . We will incur losses if the fair value of the Financial instruments sold, not yet purchased , increases subsequent to September 30, 2025, which might be partially or wholly offset by gains in the value of assets held as of September 30, 2025. The totals of $2,919.8 million and $2,853.3 million include a net liability of $298.3 million and $265.0 million for derivatives contracts, including those designated as hedges, based on their fair value as of September 30, 2025 and 2024, respectively.
We do not anticipate non-performance by counterparties in the situations described above. We have a policy of reviewing the credit standing of each counterparty with which we conduct business. We have credit guidelines that limit our current and potential credit exposure to any one counterparty. We administer limits, monitor credit exposure, and periodically review the financial soundness of counterparties. We manage the credit exposure relating to our trading activities in various ways, including entering into collateral arrangements and limiting the duration of exposure. Risk is mitigated in certain cases by closing out transactions and entering into risk reducing transactions.
We are a member of various exchanges that trade and clear futures and option contracts. We are also a member of and provide guarantees to securities clearinghouses and exchanges in connection with client trading activities. Associated with our memberships, we may be required to pay a proportionate share of the financial obligations of another member who may default on its obligations to the exchanges. While the rules governing different exchange memberships vary, in general our guaranty obligations would arise only if the exchange had previously exhausted its resources. In addition, any such guaranty obligation would be apportioned among the other non-defaulting members of the exchange. Our liability under these arrangements is not quantifiable and could exceed the cash and securities we have posted as collateral at the exchanges. However, management believes that the potential for us to be required to make payments under these arrangements is remote. Accordingly, no contingent liability for these arrangements has been recorded in the Consolidated Balance Sheets as of September 30, 2025 and 2024.
Effects of Inflation
Increases in our expenses, such as compensation and benefits, transaction-based clearing expenses, as well as occupancy and equipment rental, may result from inflation and may not be readily recoverable by increasing the prices of our services. While heightened interest rates are generally favorable for us, to the extent that changes in interest rates arise from inflationary pressures, and such inflationary pressures have other adverse effects on the financial markets and on the value of the financial instruments held in inventory, it may adversely affect our financial position and results of operations.
Critical Accounting Policies
Preparing consolidated financial statements in conformity with U.S. GAAP requires that management make estimates and assumptions affecting reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the financial statements, as well as the recorded amounts of revenue and expenses during the reported period. The accounting policies
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discussed in this section are those that we consider the most critical to the financial statements. Therefore, understanding these policies is important to understanding our reported and potential future results of operations and financial position.
Valuation of Financial Instruments and Foreign Currencies
Description
Substantially all financial instruments are reflected in the consolidated financial statements at fair value, or amounts that approximate fair value due to their short-term nature or level of collateralization. These financial instruments include: cash and cash equivalents; cash, securities and other assets segregated under federal and other regulations; securities purchased under agreements to resell; securities borrowed; deposits with and receivables from broker-dealers, clearing organizations, and counterparties; financial instruments owned; securities sold under agreements to repurchase; securities loaned; and financial instruments sold, but not yet purchased. Unrealized gains and losses related to these financial instruments, when we are principal to the transaction, are reflected in earnings.
Foreign currency translation is an estimate critical to consolidating in our reporting currency. The value of certain assets and liabilities denominated in foreign currencies, including foreign currencies sold, not yet purchased, are converted into their U.S. dollar equivalents at the foreign exchange rates in effect at the close of business at the end of the accounting period. For foreign currency transactions completed during each reporting period, the relevant exchange rate at the time is used before translation into U.S. dollar equivalent for consolidated reporting.
Judgment and Uncertainties
At each period end, using professional judgment and industry expertise, we select fair values for financial instruments. Where available, we price from independent sources such as listed market prices, third-party pricing services, or broker dealer price quotations. We use fair values derived from pricing models that consider current market and contractual prices for the underlying financial instruments or commodities, as well as time value and yield curve or volatility factors underlying the positions. In some cases, even though the value of a security is derived from an independent market price, or broker or dealer quote, we may need to make certain assumptions to determine the fair value.
Effect if Actual Results Differ From Assumptions
Our valuation assumptions may be incorrect, and the actual value realized upon closing any position could be different from estimated carrying value, because of changes in prices, assumptions, or the overall business environment. We believe that the likelihood of such an outcome is low and, if it should be the case, it is likely to not be significant. This view is supported by a few key factors:
• Valuations for substantially all of the financial instruments, most of which are in highly liquid markets, are available from independent, well-known publishers of market information.
• We have robust controls and procedures surrounding pricing and our various technologies involved in it.
• The relevant positions are generally short-term in nature.
• The Company holds positions in a wide range of products, such that an error in a limited number of prices is unlikely to cause a significant change to the overall result and pricing issues in a wide array of products is very unlikely.
Revenue Recognition
Description
A significant portion of our revenues are derived principally, from realized and unrealized trading income in securities, derivative instruments, commodities and foreign currencies purchased or sold for our account. We record realized and unrealized trading income on a trade date basis. We state financial instruments owned and financial instruments sold, not yet purchased and foreign currencies sold, not yet purchased, at fair value with related changes in unrealized appreciation or depreciation reflected in Principal gains, net in the Consolidated Income Statements. We record fee and interest income on the accrual basis and dividend income is recognized on the ex-dividend date.
A substantial amount of our revenues relate to Commission and clearing fees . These revenue types involve less complexity than Principal gains, net would, as, generally, we are an agent in the underlying transactions. We recognize revenues on a trade date basis for the transactions, as, typically, our obligation is met at that point and there are no future obligations to consider.
We recognize revenue on commodities that are purchased for physical delivery to clients when we meet our obligations to our clients and in an amount equal to the consideration we expect to receive at that point in time.
Judgment and Uncertainties
Judgments, outside of the valuation considerations previously discussed, relate to the timing and appropriateness of revenue recognition and whether we have fulfilled our performance obligations.
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Effect if Actual Results Differ From Assumptions
If we misapply the relevant guidance or incorrectly recognize revenue that we have not earned, earnings may be misstated. We do not believe that such a possibility is reasonably likely, because we have developed systems and controls for each of our businesses to capture all known transactions in the appropriate reporting period. In addition, the overwhelming majority of our revenue is recognized upon trade consummation, as we satisfy our performance obligations, and we do not need to estimate when that may have occurred.
Income Taxes
Description
We are subject to income taxes in the U.S. and numerous foreign jurisdictions.
Judgment and Uncertainties
Judgment is required in determining the consolidated income taxes and in evaluating tax positions, including evaluating income tax uncertainties. As a result, the company recognizes tax liabilities based on estimates of whether additional taxes and interest will be due. We currently have an immaterial amount of unrecognized tax benefits.
Income taxes are accounted for under the asset and liability method, recognizing the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled, with any change in tax rates recognized in income in the period that includes the enactment date. Management considers all relevant evidence for each jurisdiction to determine valuation allowances. If we change our determination as to the amount of deferred tax assets we expect to realize, we adjust our valuation allowance with a corresponding impact to income tax expense in the period in which such determination is made.
Effect if Actual Results Differ From Assumptions
We believe that our accruals for tax liabilities are adequate for all open audit years. This assessment relies on estimates and assumptions and may involve a series of judgments about future events. To the extent circumstances arise requiring us to change our judgment regarding the adequacy of existing tax accounts, we do not believe such a change is likely to be material to our financial statements. The tax accounts in total are relatively immaterial to the balance sheet, which, when combined with their likelihood of being misstated, particularly our valuation allowances given our positive earnings trend in recent years, results in a generally insignificant risk to us.
Valuation of and Accounting for Business Combinations
Description
We made a number of acquisitions of businesses and assets in the periods presented and prior. Certain of these acquisitions, particularly the RJO acquisition, is significant in its size and effect on our financial results. Acquisition accounting involves assumptions and estimates which may be significant.
We account for business combinations using the acquisition method of accounting, which requires that once control is obtained, all the assets acquired and liabilities assumed are recorded at fair value, or a reasonable approximation thereof, as of acquisition date. For the valuation of intangible assets acquired in a business combination, we typically use an income approach or relief from royalty method.
Specifically in the case of RJO, we used the multi-period excess earnings method to determine the estimated acquisition date fair value of the client base intangible assets. The significant assumptions used to estimate the fair value of the client base intangible assets included the expected client base attrition rate and a discount rate. Selection and evaluation of these assumptions requires specialized skills for which we engaged a valuation specialist. Further, we executed controls, including historical comparisons, industry comparisons and sensitivity analyses, surrounding these assumptions and calculations.
Although we believe our estimates of acquisition date fair values are reasonable, actual financial results could differ from those that underlie our estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on the determination of the fair value of the client base intangible assets or the goodwill acquired.
Judgment and Uncertainties
Judgment is required in selecting the valuation methods used for intangible assets and assumptions involved in each method. Judgment is further required in calculating fair value for acquired net assets and liabilities.
Effect if Actual Results Differ From Assumptions
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If results differ from assumptions it is possible that we will be required to impair intangible assets or goodwill that have significant net book values.
Recent Events
The Organisation for Economic Co-operation and Development (“OECD”) Global Anti-Base Erosion Model Rules (“Pillar Two”) aim to ensure that multinationals with revenues in excess of EUR 750 million pay a minimum effective corporate tax rate of 15% (minimum tax) in each jurisdiction in which they operate. EU member states are required to adopt the OECD Pillar Two rules, some countries have already adopted and other non-U.S. countries are expected to follow suit. Under these rules, we are required to pay a “top-up” tax to the extent that our effective tax rate in any given country is below 15%. The United States is not expected to pass Pillar Two legislation in the near term, but the top-up tax can be collected by other countries. The Pillar Two legislation is effective for us with the fiscal year beginning October 1, 2024. This minimum tax, if any, will be recognized in the period in which it is incurred.
On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted into law. The OBBBA makes permanent key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic research cost expensing and the business interest expense limitation. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented after. The legislation did not have a material impact on our fiscal 2025 effective tax rate or consolidated financial statements and is not expected to have a material impact in fiscal 2026. We continue to review the OBBBA tax provisions to assess impacts to the consolidated financial statements.
Accounting Standards Update
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which will require the Company to disclose specified additional information in its income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. ASU 2023-09 will also require the Company to disaggregate its income taxes paid disclosure by federal, state and foreign taxes, with further disaggregation required for significant individual jurisdictions. ASU 2023-09 is effective for the Company’s fiscal year ending September 30, 2026. Early adoption is permitted. The guidance allows for adoption using either a prospective or retrospective transition method. We are currently evaluating the impact that adopting this guidance will have on our disclosures.
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (Subtopic 220-40) related to disclosure of disaggregated expenses. This amendment requires public business entities to provide detailed disclosures in the notes to financial statements disaggregating specific expense categories, including employee compensation, depreciation, and intangible asset amortization, as well as certain other disclosures to provide enhancedtransparency into the nature and function of expenses. This new guidance is effective for annual periods beginning in our fiscal 2028 and interim periods beginning in our fiscal first quarter of 2029 with early adoption permitted, although we do not plan to early adopt. This guidance will be applied on a prospective basis with retrospective application permitted. Since this amendment only requires additional disclosures, adoption of this ASU will not have an impact on our financial condition, results of operations, or cash flows. We are currently evaluating the impact that adopting this guidance will have on our disclosures.
In September 2025, the FASB issued ASU 2025-06, Targeted Improvement to the Accounting for Internal-Use Software (Subtopic 350-40) related to capitalization of internal-use software costs. This amendment eliminates references to sequential software development stages and requires capitalization of internal-use software costs once management has authorized and committed to funding the software project and when the probability that the project will be completed and the software will be used to perform the function intended is evident. This new guidance is effective for annual and interim periods beginning in our fiscal 2029 with early adoption permitted. This guidance will be applied using a prospective transition approach, with a modified retrospective or full retrospective transition approach permitted. Since the capitalization of internal-use software costs generally will not change significantly for most types of software under the amendments in this guidance, we do not expect adoption of this ASU to have a material impact on our financial condition or results of operations. We are currently evaluating the impact that adopting this guidance will have on our disclosures.
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Non-GAAP Financial Information
The following table reconciles net income to EBITDA and Adjusted EBITDA.
Fiscal Year Ended September 30,
% Change
% Change
(in millions)
Net income
Interest expense
Depreciation and amortization
Income tax expense
EBITDA
Amortization of share-based compensation
Interest expense attributable to trading activities
Gain on acquisition and other gains, net
Adjusted EBITDA
EBITDA, a non-GAAP measure used to measure operating performance, is defined as net income plus interest expense, depreciation and amortization, and income tax expense. Adjusted EBITDA represents EBITDA plus amortization of share-based compensation and less interest expenses attributable to trading activities, including the credit facilities of our subsidiaries, gain on acquisitions, and other non-recurring gains and losses, net.
Each of the EBITDA-based measures described above is not a presentation made in accordance with GAAP and should not be considered as an alternative to net income or any other performance measures derived in accordance with GAAP as a measure of operating performance or to cash flows as a measure of liquidity. Additionally, each such measure is not intended to be a measure of free cash flows available for management’s discretionary use, as it does not consider certain cash requirements such as interest payments, tax payments and debt service requirements. Such measures have limitations as analytical tools, and you should not consider any of such measures in isolation or as substitutes for our results as reported under GAAP. Management compensates for the limitations of using non-GAAP financial measures by using them to supplement GAAP results to provide a more complete understanding of the factors and trends affecting the business than GAAP results alone. Because not all companies use identical calculations, these EBITDA-based measures may not be comparable to other similarly titled measures of other companies.
The Company believes EBITDA is helpful in highlighting the business’s trends because EBITDA excludes the results of decisions that are outside the control of management and can differ significantly from company to company depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which companies operate and capital investments. In addition, we believe EBITDA may provide more comparability between the historical operating results that reflect purchase accounting and the new capital structure.
