Thinkorswim Group 1Q Profit Sinks On Fed Rate Cuts

NEW YORK (AP) — Thinkorswim Group Inc., an online brokerage and investor-education service provider, said Friday its first-quarter profit sank 59 percent, hurt by falling interest rates.

Quarterly earnings dropped to $4.7 million, or 7 cents per share, from $11.5 million, or 17 cents per share in the same period last year.

Revenue fell 15 percent to $77.1 million from $91 million in the year-ago quarter.

Wall Street was expecting stronger results. Analysts surveyed by Thomson Reuters had predicted a profit of 16 cents per share on $85.8 million in sales.

Thinkorswim, which in January agreed to be bought by online brokerage TD Ameritrade Holding Corp. for about $600 million in a cash and stock deal, said the drop in revenue was primarily due to falling federal funds interest rates.

The company also said it agreed in principle to settle a previously announced Securities and Exchange Commission inquiry, and has set aside $3 million related to the settlement.

Its shares were unchanged in after-hours trading, after rising 21 cents, or 2.2 percent, to close Friday at $9.93.