Ameritrade Off To A Fast Start

Online brokerage Ameritrade Holding Corp. reported strong results for the first quarter, recording net income of $72 million, up from $22 million for the same quarter a year earlier. Ameritrade says total revenue for the period ending Dec. 31 was $229 million, up from $186 million for the year-ago quarter.

Average client trades per day were 175,000, up from 159,000 the previous quarter, which ended Sept. 26, while assets in client accounts climbed to $65 billion from $55 billion the previous quarter. The company on Tuesday increased its earnings guidance for the 2004 fiscal year to between 49 cents and 79 cents per share.

With 3 million brokerage accounts, the company is one of the Big Three in the discount brokerage market, together with E-Trade Financial Corp., which also has 3 million accounts, and market leader Charles Schwab & Co., which has 8 million accounts.

In line with the trend toward consolidation in the brokerage industry, Ameritrade has been on an acquisition tear. Its 2002 acquisition of Datek Online, the largest acquisition in the online brokerage industry, was built largely around the idea of achieving significant cost savings by merging the companies' online trading systems. Said Ameritrade CEO Joe Moglia, "Technology is the lifeblood of what we do, our single greatest competitive advantage."