IG Group faces a major investor test on Thursday, October 8, as the London-listed trading company presents its planned acquisition of US prediction-markets business Underdog after cutting its 2026 revenue outlook.

IG expects third-quarter total revenue of about £240 million for the three months ended September 30, 2026. That would be roughly 14% below the £280.1 million recorded in the same quarter of 2025.

The company now expects full-year 2026 revenue growth in the mid-single-digit percentage range. Its earlier forecast was for growth of 10% to 15%.

IG is trying to buy a fast-growing US business while its established trading engine is producing less revenue from each unit of customer activity.

A strong deal target, a softer buyer

Underdog gives IG a very different growth story. The US business generated approximately $105 million in net revenue during the third quarter, more than double its result a year earlier, according to IG’s trading update.

IG agreed on July 30, 2026, to acquire Underdog for total consideration of up to approximately $1.3 billion. The deal remains subject to regulatory approvals.

  • Upfront consideration is based on an enterprise value of about $1.1 billion.
  • A potential earn-out could add roughly $200 million.
  • Underdog’s third-quarter net revenue reached approximately $105 million.

The contrast is difficult to miss. IG’s core over-the-counter derivatives business is retaining less revenue in calmer market conditions, while Underdog is expanding rapidly ahead of its seasonally important fourth quarter.

Why IG’s core numbers weakened

IG said revenue retention in its over-the-counter derivatives business fell to about 70% in the third quarter. The average had been approximately 80% since the company introduced market-making optimisation measures in the second half of 2025.

Net trading revenue was expected to reach about £210 million, compared with £249.5 million a year earlier. Over-the-counter net trading revenue was approximately £155 million, down around 18% year on year, even as over-the-counter customer income rose by about 8%.

Customer activity was not uniformly weak. Organic first trades increased by more than 25%, while organic active customers rose by about 17%. The pressure came from how much revenue IG retained from trading activity, rather than from a simple collapse in customer numbers.

The questions around Underdog

Investors will want to know whether Underdog’s growth can offset volatility in IG’s established business. They will also be watching the timing of regulatory approvals, the final funding structure and the cost of integrating the US operation.

Reuters reported that analysts at RBC Capital Markets viewed Underdog’s third-quarter revenue as below the roughly $125 million quarterly run rate it had averaged in the first half of 2026. That does not erase Underdog’s year-on-year growth, but it gives investors another figure to test before the deal closes.

IG’s July announcement said the acquisition could more than double its US revenue and increase US monthly active customers more than tenfold. The company also said the enlarged group could achieve stronger medium-term revenue growth, with Underdog expected to contribute a double-digit revenue growth rate after completion.

Those are company targets, not completed results. The key issue is whether the acquisition can deliver enough growth to offset weaker revenue retention in IG’s existing business.

What happens next

IG is holding a virtual seminar for institutional investors and analysts on Thursday, October 8, from 2pm to 3.15pm British Summer Time. Underdog co-founder and chief executive Jeremy Levine is due to appear alongside IG chief executive Breon Corcoran and chief financial officer Clifford Abrahams.

The company plans to provide fuller detail on third-quarter trading during its October 22 strategy update in London. The event is expected to set out IG’s strategy, capital allocation framework and guidance for the enlarged group.

For the British market, the deal marks a notable shift by a major London-listed financial-services group towards products linked to sport, entertainment and event-based trading.

The immediate challenge is clear: IG must prove that its new US growth engine can earn investor confidence while its original engine is running below expectations.