IG Group expects Q3 revenue to fall 14% as OTC retention weakens

British online trading firm IG Group is projecting a 14% decline in third-quarter revenue to approximately £240 million, compared to £249.5 million a year ago. The reduction is attributed to weaker retention of revenue from customer trading losses in its over-the-counter (OTC) derivatives business, where OTC revenue retention stood at about 70% in the quarter, below the usual 80% level since IG implemented changes to its market-making operations in the second half of 2025.

IG anticipates that these changes will eventually boost OTC revenue retention in the medium to long term, although quarterly results may experience more volatility in the near future. Consequently, the company has lowered its 2026 revenue growth outlook to a mid-single-digit percentage range year-on-year. IG's third-quarter net trading revenue is expected to be around £210 million, down from £249.5 million in the previous year.

OTC net trading revenue dropped about 18% to £155 million, while OTC customer income rose by about 8%. Customer activity remained robust, with organic first trades increasing more than 25% year-on-year and active customers growing by about 17%. Additionally, IG's Underdog business performed exceptionally well, with third-quarter net revenue more than doubling to about $105 million.

This comes as IG prepares for the seasonally significant fourth quarter, which accounted for more than a third of Underdog's revenue in 2025. The weaker Q3 revenue is primarily due to reduced OTC revenue retention in less favorable market conditions. IG's Chief Executive Breon Corcoran highlighted this in a statement. The company expects to incur about £30 million of non-recurring costs in 2026 related to relocating its operations to Jersey and restructuring its organizational model, announced in July.

Of these costs, £16.4 million were incurred in the first half of the year. Excluding these costs and expenses related to the Underdog acquisition, which depend on completion, IG forecasts its 2026 EBITDA margin to be in the low-40% range.