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Yahoo
27-07-2025
- Business
- Yahoo
Nasdaq (NDAQ) Climbs on Impressive Q2 Earnings
We recently published . Nasdaq, Inc. (NASDAQ:NDAQ) is one of the best-performing stocks on Thursday. Nasdaq Inc. saw its share prices increase by 5.91 percent on Thursday to close at $93.50 apiece after reporting impressive earnings performance in the second quarter of the year. In its earnings statement, Nasdaq, Inc. (NASDAQ:NDAQ) said net income during the period more than doubled to $452 million from $222 million previously, pushing its six-month figure higher by 86 percent to $847 million from $456 million previously. Net revenues increased by 12 percent to $1.3 billion from $1.16 billion year-on-year, with the six-month figure up by 9.6 percent at $2.5 billion from $2.28 billion. 'Nasdaq's financial results highlight the resilience of our business model and its ability to achieve exceptional revenue and earnings growth with strong free cash flow generation,' said Nasdaq, Inc. (NASDAQ:NDAQ) CFO Sarah Youngwood. 'We are executing well on our capital allocation priorities, including repaying debt, and have surpassed our gross leverage milestone 16 months ahead of plan. We will optimize for long-term investor returns as we make organic growth investments and balance further deleveraging with opportunistic share repurchases,' she added. While we acknowledge the potential of NDAQ as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the . Sign in to access your portfolio
Yahoo
26-07-2025
- Business
- Yahoo
Nasdaq (NDAQ) Climbs on Impressive Q2 Earnings
We recently published . Nasdaq, Inc. (NASDAQ:NDAQ) is one of the best-performing stocks on Thursday. Nasdaq Inc. saw its share prices increase by 5.91 percent on Thursday to close at $93.50 apiece after reporting impressive earnings performance in the second quarter of the year. In its earnings statement, Nasdaq, Inc. (NASDAQ:NDAQ) said net income during the period more than doubled to $452 million from $222 million previously, pushing its six-month figure higher by 86 percent to $847 million from $456 million previously. Net revenues increased by 12 percent to $1.3 billion from $1.16 billion year-on-year, with the six-month figure up by 9.6 percent at $2.5 billion from $2.28 billion. 'Nasdaq's financial results highlight the resilience of our business model and its ability to achieve exceptional revenue and earnings growth with strong free cash flow generation,' said Nasdaq, Inc. (NASDAQ:NDAQ) CFO Sarah Youngwood. 'We are executing well on our capital allocation priorities, including repaying debt, and have surpassed our gross leverage milestone 16 months ahead of plan. We will optimize for long-term investor returns as we make organic growth investments and balance further deleveraging with opportunistic share repurchases,' she added. While we acknowledge the potential of NDAQ as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the .
Yahoo
24-07-2025
- Business
- Yahoo
Nasdaq Reports Second Quarter 2025 Results; Double-Digit Net Revenue Growth Reflects Strong Momentum Across All Divisions
NEW YORK, July 24, 2025 (GLOBE NEWSWIRE) -- Nasdaq, Inc. (Nasdaq: NDAQ) today reported financial results for the second quarter of 2025. Second quarter 2025 net revenue1 was $1.3 billion, an increase of 13% over the second quarter of 2024, or up 12% on an organic2 basis. This included Solutions3 revenue growing 10%. Annualized Recurring Revenue (ARR)4 of $2.9 billion increased 10% over the second quarter of 2024, or up 9% on an organic basis. Annualized SaaS revenue increased 13%, or 12% on an organic basis, and represented 37% of ARR. Financial Technology revenue of $464 million increased 10% over the second quarter of 2024. Index revenue of $196 million grew 17%, with $88 billion of net inflows over the trailing twelve months and $20 billion in the second quarter of 2025. GAAP diluted earnings per share grew over 100% in the second quarter of 2025. Non-GAAP5 diluted earnings per share grew 24% in the second quarter of 2025. In the second quarter of 2025, the company returned $155 million to shareholders through dividends and $100 million through repurchases of common stock. The company also repaid $400 million of senior unsecured notes in the quarter. Second Quarter 2025 Highlights (US$ millions, except per share) 2Q25 YoY change % Adjusted2 YoY change % Organic YoY change % Solutions revenue $991 10% 10% 10% Market Services net revenue $306 22% 21% 21% Net revenue $1,306 13% 12% 12% GAAP operating income $568 34% Non-GAAP operating income $721 16% 16% 16% ARR $2,931 10% 9% 9% GAAP diluted EPS $0.78 103% Non-GAAP diluted EPS $0.85 24% 24% Note: Adjusted and organic change for 2Q25 as compared to 2Q24 are equivalent as they include the same period over period adjustments. Refer to the footnotes to this press release for more information. Adena Friedman, Chair and CEO said, 'Nasdaq delivered an excellent second quarter performance amid a dynamic market environment. Our ability to deliver broad-based growth through cycles is testament to our role as a partner to our clients, helping them capture strategic opportunities, manage risk, and solidify their operational resilience. Looking ahead, we remain well-positioned to enhance value for our clients and shareholders by driving innovation and deepening our client relationships through our One Nasdaq approach.' Sarah Youngwood, Executive Vice President and CFO said, 'Nasdaq's financial results highlight the resilience of our business model and its ability to achieve exceptional revenue and earnings growth with strong free cash flow generation. We are executing well on our capital allocation priorities, including repaying debt, and have surpassed our gross leverage milestone 16 months ahead of plan. We will optimize for long-term investor returns as we make organic growth investments and balance further deleveraging with opportunistic share repurchases.'FINANCIAL REVIEW Second quarter 2025 net revenue was $1,306 million, reflecting 13% growth versus the prior year period. Organic net revenue growth was 12%. Solutions revenue was $991 million in the second quarter of 2025, up 10% versus the prior year period, reflecting strong growth from Index and Financial Technology. ARR grew 10% year-over-year, or 9% on an organic basis, in the second quarter of 2025, with 12% ARR growth for Financial Technology, or 11% on an organic basis, and 7% ARR growth for Capital Access Platforms, or 6% on an organic basis. Market Services net revenue was $306 million in the second quarter of 2025, up 22% versus the prior year period, or 21% on an organic basis. Second quarter 2025 GAAP operating expenses were $738 million, in line with the prior year period. The quarter reflected lower restructuring costs, offset by higher compensation and benefits costs, merger and strategic initiative costs, and increased investments in technology and people to drive innovation and long-term growth. Second quarter 2025 non-GAAP operating expenses were $585 million, reflecting 9% growth versus the prior year period, or 8% growth on an organic basis. The organic increase for the quarter reflected growth driven by increased investments in technology and people to drive innovation and long-term growth, partially offset by the benefit of synergies. Cash flow from operations was $746 million for the second quarter, enabling the company to make continued progress on its deleveraging plan. In the second quarter of 2025, the company returned $155 million to shareholders through dividends and $100 million through repurchases of common stock. As of June 30, 2025, there was $1.5 billion remaining under the board authorized share repurchase program. The company also repaid $400 million of senior unsecured notes in the second quarter of 2025. 2025 EXPENSE AND TAX GUIDANCE UPDATE6 The company is updating its 2025 non-GAAP operating expense guidance to a range of $2,295 million to $2,335 million. The driver of the update is the impact of foreign exchange rates, which is offset in net revenue. The company is maintaining its 2025 non-GAAP tax rate guidance in the range of 22.5% to 24.5%. STRATEGIC AND BUSINESS UPDATES Financial Technology achieved solid revenue growth across each subdivision in a dynamic macro environment. Robust client demand drove double-digit revenue and ARR growth. FinTech delivered 57 new clients, 130 upsells, and a record 7 cross-sells. Second quarter highlights included: Financial Crime Management Technology is executing on its key growth initiatives. Second quarter results included three new enterprise client signings, including a cross-sell client and 2 upsells, reflecting continued progress on its enterprise client land and expand strategy. Nasdaq Verafin added 46 new small-and-medium bank clients in the second quarter. The business also signed its first proof of concept project with a European Tier 1 bank as part of its international expansion strategy. Regulatory Technology's success with new client wins and upsells driving growth. AxiomSL signed a new client and a cross-sell. The business accelerated its momentum with existing clients in the second quarter with 34 upsells, including the renewal of a large bank. Surveillance signed 6 new clients in the quarter, including 2 market operators and a European regulator, as well as 3 cross-sells. The business closed 33 upsells in the quarter, including a strategic upsell to a large European bank. Solid momentum in Capital Markets Technology. Second quarter client demand was robust, supported by the ongoing market modernization mega trend. Calypso signed 2 new clients, 37 upsells, and a cross-sell. Market Technology secured 2 new clients, 24 upsells, and a cross-sell. In the second quarter, the business signed 3 clients to its fourth-generation marketplace technology platform, Nasdaq Eqlipse, including 2 fully managed services mandates where Nasdaq hosts and manages the clients' entire trading environment and one AWS-hosted SaaS deployment. Index ETP assets under management reached record levels and surpassed $700 billion at quarter-end. In the second quarter, Index had $20 billion in net inflows. ETP AUM was $745 billion at quarter-end, an all-time high. Nasdaq launched 33 new Index products in the second quarter, including 21 international products, 12 products in partnership with new Index clients, and 7 in the institutional insurance annuity space. Nasdaq and CME Group signed an extension through 2039 of CME Group's exclusive license contract to offer futures and options on futures based on the Nasdaq-100 and other Nasdaq indexes, reflecting the companies' shared commitment to delivering value through trusted benchmark products. Nasdaq extended its listing leadership to 46 consecutive quarters. Nasdaq had the highest number of first half listings since 2021. New listings in the first half included 83 operating companies that raised more than $8 billion in total proceeds, contributing to a 81% win rate for eligible operating company listings. In the second quarter, the company welcomed 38 U.S. operating company IPOs that raised more than $3.5 billion in proceeds with a 79% win rate. Nasdaq maintained momentum in its switch program, attracting nearly $50 billion in market value in the second quarter and over $270 billion year-to-date, including Shopify, Thomson Reuters, and Kimberly Clark. Market Services delivered record net revenue with record cash equities and derivatives revenue in the U.S. Nasdaq's exchanges achieved record U.S. cash equities volumes in a quarter in which the industry achieved record volumes. During the Russell reconstitution, Nasdaq's Closing Cross successfully executed 2.5 billion shares in 0.871 seconds across Nasdaq-listed securities that represented a record $102.5 billion dollars in notional value. Extending the first quarter's trend, Nasdaq's North American markets continued to experience exceptional message traffic in the second quarter, reaching a new record of more than 560 billion messages7 in a day. Nasdaq's European equities business achieved sequential market share improvement in an elevated volume environment. Nasdaq continues to execute on its 2025 strategic priorities — Integrate, Innovate, Accelerate — positioning the company to capitalize on opportunities for sustainable, scalable, and resilient growth. Integrate – Nasdaq is on track to action its $140 million expanded net expense efficiency program by year-end, with approximately $130 million actioned as of the end of the second quarter. In the second quarter, Nasdaq surpassed the 3.3x gross leverage milestone that was set following the Adenza acquisition, achieving this milestone 16 months ahead of plan. Innovate – Nasdaq continues to focus on innovating across the business. In July, Nasdaq Verafin announced the launch of its Agentic AI workforce. This suite of digital workers, now in beta testing, has the potential to address the most resource intensive anti-money laundering workflows. For example, when onboarded into a bank's alert triage workflow, the Digital Sanctions Analyst automates the screening, documentation and acknowledgement processes, reducing alert review workload requiring human intervention by more than 80%. Beyond AI, Calypso announced a proof of concept that expands its industry-leading collateral management capabilities with digital assets. The use case demonstrates Nasdaq's ability to integrate on-chain capabilities and help financial institutions manage collateral across asset classes in a more dynamic and efficient manner. Nasdaq became the exclusive distributor of Nasdaq Private Market's Tape D(R) API in the second quarter to deliver real-time private market data and valuation insights to investors. Accelerate – Nasdaq continued to deliver on its One Nasdaq strategy driving 7 cross-sell wins across Financial Technology in the quarter for a total of 26 cross-sells since the Adenza acquisition. Nasdaq remains on track to surpass $100 million in run-rate revenue from cross-sells by the end of 2027. At the end of the second quarter, cross-sells continued to account for over 15% of Financial Technology's sales pipeline. ____________1 Represents revenue less transaction-based expenses. 2 Adjusted and organic change for 2Q25 as compared to 2Q24 are equivalent as they include the same period over period adjustments. These changes are calculated by (i) removing the impact of period over period changes in foreign currency exchange rates (ii) adjusting for the impact of a divestiture and (iii) adjusting for the impact of AxiomSL on-premises contracts for ratable recognition for 2Q24, which was immaterial during that period. As it relates to ARR, organic changes only exclude the impacts of period over period changes in foreign currency exchange rates and a divestiture as the AxiomSL ratable recognition adjustment had no impact on ARR. Adjusted operating results also exclude the impact of the previously announced one-time revenue benefit in our Index business in 1Q24 ($16 million), which did not have an impact on our 2Q25 period over period change but does have an impact on year to date period over period results.3 Constitutes revenue from our Capital Access Platforms and Financial Technology segments.4 Annualized Recurring Revenue (ARR) for a given period is the current annualized value derived from subscription contracts with a defined contract value. This excludes contracts that are not recurring, are one-time in nature or where the contract value fluctuates based on defined metrics. ARR is currently one of our key performance metrics to assess the health and trajectory of our recurring business. ARR does not have any standardized definition and is therefore unlikely to be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or to replace either of those items. For AxiomSL and Calypso recurring revenue contracts, the amount included in ARR is consistent with the amount that we invoice the customer during the current period. Additionally, for AxiomSL and Calypso recurring revenue contracts that include annual values that increase over time, we include in ARR only the annualized value of components of the contract that are considered active as of the date of the ARR calculation. We do not include the future committed increases in the contract value as of the date of the ARR calculation. ARR is not a forecast and the active contracts at the end of a reporting period used in calculating ARR may or may not be extended or renewed by our customers.5 Refer to our reconciliations of U.S. GAAP to non-GAAP net income attributable to Nasdaq, diluted earnings per share, operating income, operating expenses and organic impacts included in the attached schedules.6 U.S. GAAP operating expense and tax rate guidance are not provided due to the inherent difficulty in quantifying certain amounts due to a variety of factors including the unpredictability in the movement in foreign currency rates, as well as future charges or reversals outside of the normal course of business.7 Message count represents the number of records across Nasdaq's U.S. options, U.S. and Canadian equities markets, trade reporting facilities, and bond exchange that are recorded into Nasdaq's data warehouse on a daily basis. ABOUT NASDAQ Nasdaq (Nasdaq: NDAQ) is a global technology company serving corporate clients, investment managers, banks, brokers, and exchange operators as they navigate and interact with the global capital markets and the broader financial system. We aspire to deliver world-leading platforms that improve the liquidity, transparency, and integrity of the global economy. Our diverse offering of data, analytics, software, exchange capabilities, and client-centric services enables clients to optimize and execute their business vision with confidence. To learn more about the company, technology solutions and career opportunities, visit us on LinkedIn, on X @Nasdaq, or at NON-GAAP INFORMATION In addition to disclosing results determined in accordance with U.S. GAAP, Nasdaq also discloses certain non-GAAP results of operations, including, but not limited to, non-GAAP net income attributable to Nasdaq, non-GAAP diluted earnings per share, non-GAAP operating income, and non-GAAP operating expenses, that include certain adjustments or exclude certain charges and gains that are described in the reconciliation tables of U.S. GAAP to non-GAAP information provided at the end of this release. Management uses this non-GAAP information internally, along with U.S. GAAP information, in evaluating our performance and in making financial and operational decisions. We believe our presentation of these measures provides investors with greater transparency and supplemental data relating to our financial condition and results of operations. In addition, we believe the presentation of these measures is useful to investors for period-to-period comparisons of results as the items described below in the reconciliation tables do not reflect ongoing operating performance. These measures are not in accordance with, or an alternative to, U.S. GAAP, and may be different from non-GAAP measures used by other companies. In addition, other companies, including companies in our industry, may calculate such measures differently, which reduces their usefulness as a comparative measure. Investors should not rely on any single financial measure when evaluating our business. This information should be considered as supplemental in nature and is not meant as a substitute for our operating results in accordance with U.S. GAAP. We recommend investors review the U.S. GAAP financial measures included in this earnings release. When viewed in conjunction with our U.S. GAAP results and the accompanying reconciliations, we believe these non-GAAP measures provide greater transparency and a more complete understanding of factors affecting our business than U.S. GAAP measures alone. We understand that analysts and investors regularly rely on non-GAAP financial measures, such as those noted above, to assess operating performance. We use these measures because they highlight trends more clearly in our business that may not otherwise be apparent when relying solely on U.S. GAAP financial measures, since these measures eliminate from our results specific financial items that have less bearing on our ongoing operating performance. Organic revenue and expense growth, organic change and organic impact are non-GAAP measures that reflect adjustments for: (i) the impact of period over period changes in foreign currency exchange rates, and (ii) the revenue, expenses and operating income associated with acquisitions and divestitures for the twelve month period following the date of the acquisition or divestiture and (iii) the impact of AxiomSL on-premises contracts for ratable recognition in comparable periods to align with current period presentation. Reconciliations of these measures are described within the body of this release or in the reconciliation tables at the end of this release. Foreign exchange impact: In countries with currencies other than the U.S. dollar, revenue and expenses are translated using monthly average exchange rates. Certain discussions in this release isolate the impact of year-over-year foreign currency fluctuations to better measure the comparability of operating results between periods. Operating results excluding the impact of foreign currency fluctuations are calculated by translating the current period's results by the prior period's exchange rates. Restructuring programs: In the fourth quarter of 2023, following the closing of the Adenza acquisition, our management approved, committed to and initiated a restructuring program to optimize our efficiencies as a combined organization. We further expanded this program in the fourth quarter of 2024 to accelerate our momentum and further optimize our efficiencies (efficiency program). We have incurred costs principally related to employee-related costs, contract terminations, asset impairments and other related costs and expect to incur additional costs in these areas in an effort to accelerate efficiencies through location strategy and enhanced AI capabilities. Actions taken as part of this program will be complete by the end of 2025, while certain costs may be recognized in the first half of 2026. We expect to achieve benefits primarily in the form of expense synergies. In October 2022, following our September announcement to realign our segments and leadership, we initiated a divisional realignment program with a focus on realizing the full potential of this structure. As of September 30, 2024, we completed our divisional realignment program. Costs related to the Adenza restructuring and the divisional realignment programs are recorded as 'restructuring charges' in our condensed consolidated statements of income. We exclude charges associated with these programs for purposes of calculating non-GAAP measures as they are not reflective of ongoing operating performance or comparisons in Nasdaq's performance between periods. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Information set forth in this communication contains forward-looking statements that involve a number of risks and uncertainties. Nasdaq cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information. Such forward-looking statements include, but are not limited to (i) projections relating to our future financial results, total shareholder returns, growth, dividend program, trading volumes, products and services, ability to transition to new business models, taxes and achievement of synergy targets, (ii) statements about the closing or implementation dates and benefits of certain acquisitions, divestitures and other strategic, restructuring, technology, de-leveraging and capital allocation initiatives, (iii) statements about our integrations of our recent acquisitions, (iv) statements relating to any litigation or regulatory or government investigation or action to which we are or could become a party, and (v) other statements that are not historical facts. Forward-looking statements involve a number of risks, uncertainties or other factors beyond Nasdaq's control. These factors include, but are not limited to, Nasdaq's ability to implement its strategic initiatives, economic, political and market conditions and fluctuations, geopolitical instability, government and industry regulation, interest rate risk, U.S. and global competition. Further information on these and other factors are detailed in Nasdaq's filings with the U.S. Securities and Exchange Commission, including its annual reports on Form 10-K and quarterly reports on Form 10-Q, which are available on Nasdaq's investor relations website at and the SEC's website at Nasdaq undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. WEBSITE DISCLOSURE Nasdaq intends to use its website, as a means for disclosing material non-public information and for complying with SEC Regulation FD and other disclosure obligations. Media Relations Contact: David Lurie+ Investor Relations Contact: Ato Garrett+ -NDAQF-Nasdaq, Inc. Condensed Consolidated Statements of Income (in millions, except per share amounts) (unaudited) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2025 2024 2025 2024 Revenues: Capital Access Platforms $ 527 $ 481 $ 1,042 $ 960 Financial Technology 464 420 896 813 Market Services 1,090 883 2,224 1,678 Other Revenues 9 8 18 18 Total revenues 2,090 1,792 4,180 3,469 Transaction-based expenses: Transaction rebates (629 ) (483 ) (1,208 ) (965 ) Brokerage, clearance and exchange fees (155 ) (150 ) (429 ) (227 ) Revenues less transaction-based expenses 1,306 1,159 2,543 2,277 Operating Expenses: Compensation and benefits 352 328 681 669 Professional and contract services 39 39 75 72 Technology and communication infrastructure 79 69 156 135 Occupancy 30 27 58 56 General, administrative and other 23 30 29 58 Marketing and advertising 14 12 28 23 Depreciation and amortization 158 153 313 308 Regulatory 14 18 29 28 Merger and strategic initiatives 20 4 44 13 Restructuring charges 9 56 15 82 Total operating expenses 738 736 1,428 1,444 Operating income 568 423 1,115 833 Interest income 12 6 24 12 Interest expense (95 ) (102 ) (192 ) (211 ) Net gain on divestitures 39 — 39 — Other income 1 12 — 13 Net income from unconsolidated investees 23 2 50 6 Income before income taxes 548 341 1,036 653 Income tax provision 96 119 190 198 Net income 452 222 846 455 Net loss attributable to noncontrolling interests — — 1 1 Net income attributable to Nasdaq $ 452 $ 222 $ 847 $ 456 Per share information: Basic earnings per share $ 0.79 $ 0.39 $ 1.47 $ 0.79 Diluted earnings per share $ 0.78 $ 0.38 $ 1.46 $ 0.79 Cash dividends declared per common share $ 0.27 $ 0.24 $ 0.51 $ 0.46 Weighted-average common shares outstanding for earnings per share: Basic 574.1 576.4 574.6 575.9 Diluted 579.0 579.0 579.5 578.9 Nasdaq, Inc. Revenue Detail (in millions) (unaudited) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2025 2024 2025 2024 CAPITAL ACCESS PLATFORMS Data and Listing Services revenues $ 198 $ 187 $ 391 $ 372 Index revenues 196 167 388 336 Workflow and Insights revenues 133 127 263 252 Total Capital Access Platforms revenues 527 481 1,042 960 FINANCIAL TECHNOLOGY Financial Crime Management Technology revenues 81 67 157 131 Regulatory Technology revenues 104 95 206 186 Capital Markets Technology revenues 279 258 533 496 Total Financial Technology revenues 464 420 896 813 MARKET SERVICES Market Services revenues 1,090 883 2,224 1,678 Transaction-based expenses: Transaction rebates (629 ) (483 ) (1,208 ) (965 ) Brokerage, clearance and exchange fees (155 ) (150 ) (429 ) (227 ) Total Market Services revenues, net 306 250 587 486 OTHER REVENUES 9 8 18 18 REVENUES LESS TRANSACTION-BASED EXPENSES $ 1,306 $ 1,159 $ 2,543 $ 2,277 Nasdaq, Inc. Condensed Consolidated Balance Sheets (in millions) June 30, December 31, 2025 2024 Assets (unaudited) Current assets: Cash and cash equivalents $ 732 $ 592 Restricted cash and cash equivalents 195 31 Default funds and margin deposits 5,218 5,664 Financial investments 84 184 Receivables, net 896 1,022 Other current assets 227 293 Total current assets 7,352 7,786 Property and equipment, net 656 593 Goodwill 14,328 13,957 Intangible assets, net 6,741 6,905 Operating lease assets 441 375 Other non-current assets 865 779 Total assets $ 30,383 $ 30,395 Liabilities Current liabilities: Accounts payable and accrued expenses $ 246 $ 269 Section 31 fees payable to SEC 411 319 Accrued personnel costs 280 325 Deferred revenue 848 711 Other current liabilities 154 215 Default funds and margin deposits 5,218 5,664 Short-term debt 500 399 Total current liabilities 7,657 7,902 Long-term debt 8,678 9,081 Deferred tax liabilities, net 1,540 1,594 Operating lease liabilities 453 388 Other non-current liabilities 237 230 Total liabilities 18,565 19,195 Commitments and contingencies Equity Nasdaq stockholders' equity: Common stock 6 6 Additional paid-in capital 5,425 5,530 Common stock in treasury, at cost (706 ) (647 ) Accumulated other comprehensive loss (1,869 ) (2,099 ) Retained earnings 8,955 8,401 Total Nasdaq stockholders' equity 11,811 11,191 Noncontrolling interests 7 9 Total equity 11,818 11,200 Total liabilities and equity $ 30,383 $ 30,395 Nasdaq, Inc. Reconciliation of U.S. GAAP to Non-GAAP Net Income Attributable to Nasdaq and Diluted Earnings Per Share (in millions, except per share amounts) (unaudited) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2025 2024 2025 2024 U.S. GAAP net income attributable to Nasdaq $ 452 $ 222 $ 847 $ 456 Non-GAAP adjustments: Amortization expense of acquired intangible assets (1) 122 122 243 244 Merger and strategic initiatives expense (2) 20 4 44 13 Restructuring charges (3) 9 56 15 82 Net gain on divestitures (4) (39 ) — (39 ) — Net income from unconsolidated investees (5) (23 ) (2 ) (50 ) (6 ) Gain on extinguishment of debt (6) — — (19 ) — Legal and regulatory matters (7) 1 13 4 16 Pension settlement charge (8) — — — 23 Other loss (income) (9) 1 (10 ) 1 (9 ) Total non-GAAP adjustments 91 183 199 363 Non-GAAP adjustment to the income tax provision (10) (24 ) (41 ) (70 ) (88 ) Other tax adjustments (11) (27 ) 33 (27 ) 33 Total non-GAAP adjustments, net of tax 40 175 102 308 Non-GAAP net income attributable to Nasdaq $ 492 $ 397 $ 949 $ 764 U.S. GAAP diluted earnings per share $ 0.78 $ 0.38 $ 1.46 $ 0.79 Total adjustments from non-GAAP net income above 0.07 0.31 0.18 0.53 Non-GAAP diluted earnings per share $ 0.85 $ 0.69 $ 1.64 $ 1.32 Weighted-average diluted common shares outstanding for earnings per share: 579.0 579.0 579.5 578.9 (1) We amortize intangible assets acquired in connection with various acquisitions. Intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from our ongoing business operations. (2) We have pursued various strategic initiatives and completed acquisitions and divestitures in recent years that have resulted in expenses which would not have otherwise been incurred. These expenses generally include integration costs, as well as legal, due diligence and other third-party transaction costs. The frequency and the amount of such expenses vary significantly based on the size, timing and complexity of the transaction. For the three and six months ended June 30, 2025 and June 30, 2024, these costs included Adenza integration costs and other strategic initiative costs. For the three and six months ended June 30, 2024, these costs were partially offset by the recognition of a termination fee due to Nasdaq in the second quarter of 2024 related to the termination of the then proposed divestiture of our Nordic power futures business. For the three and six months ended June 30, 2025, these costs included a repayment of this fee due to the closing of the transaction with another buyer, as designated in the settlement agreement. (3) For a description of our restructuring programs, see "Restructuring Programs" in the "Non-GAAP Information" section of this earnings release. (4) For the three and six months ended June 30, 2025, we recorded pre-tax net gains on the sale of our Nordic power futures business and our Nasdaq Risk Modelling for Catastrophes business, which are included in net gain on divestitures in the Condensed Consolidated Statements of Income. (5) We exclude our share of the earnings and losses of our equity method investments. This provides a more meaningful analysis of Nasdaq's ongoing operating performance or comparisons in Nasdaq's performance between periods. (6) For the six months ended June 30, 2025, we recorded a gain on the extinguishment of debt. This gain is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income. (7) For the three and six months ended June 30, 2025, this includes accruals relating to certain legal matters, which are recorded in professional and contract services in the Condensed Consolidated Statements of Income. For the three and six months ended June 30, 2024, these items primarily included the settlement of a Swedish Financial Supervisory Authority, or SFSA, fine, which is recorded in regulatory expense in the Condensed Consolidated Statements of Income. (8) For the six months ended June 30, 2024, we recorded a pre-tax charge as a result of settling our U.S. pension plan. The plan was terminated and partially settled in 2023, with final settlement occurring during the first quarter of 2024. The loss was recorded in compensation and benefits in the Condensed Consolidated Statements of Income. (9) For the three and six months ended June 30, 2024, other items primarily include net gains from strategic investments entered into through our corporate venture program, which are included in other income in our Condensed Consolidated Statements of Income. (10) The non-GAAP adjustment to the income tax provision primarily includes the tax impact of each non-GAAP adjustment. For the six months ended June 30, 2025, this also includes a release of the prior year's reserves following a favorable audit settlement. (11) For the three and six months ended June 30, 2025, we recorded a tax benefit related to payments made to certain former Adenza employees. For the three and six months ended June 30, 2024, other tax adjustments also includes a one-time net tax expense of $33 million related to the completion of an intra-group transfer of certain IP assets to our U.S. headquarters. Nasdaq, Inc. Reconciliation of U.S. GAAP to Non-GAAP Operating Income and Operating Margin (in millions) (unaudited) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2025 2024 2025 2024 U.S. GAAP operating income $ 568 $ 423 $ 1,115 $ 833 Non-GAAP adjustments: Amortization expense of acquired intangible assets (1) 122 122 243 244 Merger and strategic initiatives expense (2) 20 4 44 13 Restructuring charges (3) 9 56 15 82 Gain on extinguishment of debt (4) — — (19 ) — Legal and regulatory matters (5) 1 13 4 16 Pension settlement charge (6) — — — 23 Other loss 1 2 1 2 Total non-GAAP adjustments 153 197 288 380 Non-GAAP operating income $ 721 $ 620 $ 1,403 $ 1,213 Revenues less transaction-based expenses $ 1,306 $ 1,159 $ 2,543 $ 2,277 U.S. GAAP operating margin (7) 44 % 36 % 44 % 37 % Non-GAAP operating margin (8) 55 % 53 % 55 % 53 % Note: The current period percentages are calculated based on exact dollars, and therefore may not recalculate exactly using rounded numbers as presented in US$ millions. (1) We amortize intangible assets acquired in connection with various acquisitions. Intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from our ongoing business operations. (2) We have pursued various strategic initiatives and completed acquisitions and divestitures in recent years that have resulted in expenses which would not have otherwise been incurred. These expenses generally include integration costs, as well as legal, due diligence and other third-party transaction costs. The frequency and the amount of such expenses vary significantly based on the size, timing and complexity of the transaction. For the three and six months ended June 30, 2025 and June 30, 2024, these costs included Adenza integration costs and other strategic initiative costs. For the three and six months ended June 30, 2024, these costs were partially offset by the recognition of a termination fee due to Nasdaq in the second quarter of 2024 related to the termination of the then proposed divestiture of our Nordic power futures business. For the three and six months ended June 30, 2025, these costs included a repayment of this fee due to the closing of the transaction with another buyer, as designated in the settlement agreement. (3) For a description of our restructuring programs, see "Restructuring Programs" in the "Non-GAAP Information" section of this earnings release. (4) For the six months ended June 30, 2025, we recorded a gain on the extinguishment of debt. This gain is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income. (5) For the three and six months ended June 30, 2025, this includes accruals relating to certain legal matters, which are recorded in professional and contract services in the Condensed Consolidated Statements of Income. For the three and six months ended June 30, 2024, these items primarily included the settlement of a SFSA fine, which is recorded in regulatory expense in the Condensed Consolidated Statements of Income. (6) For the six months ended June 30, 2024, we recorded a pre-tax charge as a result of settling our U.S. pension plan. The plan was terminated and partially settled in 2023, with final settlement occurring during the first quarter of 2024. The loss was recorded in compensation and benefits in the Condensed Consolidated Statements of Income. (7) U.S. GAAP operating margin equals U.S. GAAP operating income divided by revenues less transaction-based expenses. (8) Non-GAAP operating margin equals non-GAAP operating income divided by revenues less transaction-based expenses. Nasdaq, Inc. Reconciliation of U.S. GAAP to Non-GAAP Operating Expenses (in millions) (unaudited) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2025 2024 2025 2024 U.S. GAAP operating expenses $ 738 $ 736 $ 1,428 $ 1,444 Non-GAAP adjustments: Amortization expense of acquired intangible assets (1) (122 ) (122 ) (243 ) (244 ) Merger and strategic initiatives expense (2) (20 ) (4 ) (44 ) (13 ) Restructuring charges (3) (9 ) (56 ) (15 ) (82 ) Gain on extinguishment of debt (4) — — 19 — Legal and regulatory matters (5) (1 ) (13 ) (4 ) (16 ) Pension settlement charge (6) — — — (23 ) Other loss (1 ) (2 ) (1 ) (2 ) Total non-GAAP adjustments (153 ) (197 ) (288 ) (380 ) Non-GAAP operating expenses $ 585 $ 539 $ 1,140 $ 1,064 (1) We amortize intangible assets acquired in connection with various acquisitions. Intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from our ongoing business operations. (2) We have pursued various strategic initiatives and completed acquisitions and divestitures in recent years that have resulted in expenses which would not have otherwise been incurred. These expenses generally include integration costs, as well as legal, due diligence and other third-party transaction costs. The frequency and the amount of such expenses vary significantly based on the size, timing and complexity of the transaction. For the three and six months ended June 30, 2025 and June 30, 2024, these costs included Adenza integration costs and other strategic initiative costs. For the three and six months ended June 30, 2024, these costs were partially offset by the recognition of a termination fee due to Nasdaq in the second quarter of 2024 related to the termination of the then proposed divestiture of our Nordic power futures business. For the three and six months ended June 30, 2025, these costs included a repayment of this fee due to the closing of the transaction with another buyer, as designated in the settlement agreement. (3) For a description of our restructuring programs, see "Restructuring Programs" in the "Non-GAAP Information" section of this earnings release. (4) For the six months ended June 30, 2025, we recorded a gain on the extinguishment of debt. This gain is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income. (5) For the three and six months ended June 30, 2025, this includes accruals relating to certain legal matters, which are recorded in professional and contract services in the Condensed Consolidated Statements of Income. For the three and six months ended June 30, 2024, these items primarily included the settlement of a SFSA fine, which is recorded in regulatory expense in the Condensed Consolidated Statements of Income. (6) For the six months ended June 30, 2024, we recorded a pre-tax charge as a result of settling our U.S. pension plan. The plan was terminated and partially settled in 2023, with final settlement occurring during the first quarter of 2024. The loss was recorded in compensation and benefits in the Condensed Consolidated Statements of Income. Nasdaq, Inc. Reconciliation of Organic Impacts for Revenues less transaction-based expenses, Non-GAAP Operating Expenses, Non-GAAP Operating Income, and Non-GAAP Diluted Earnings Per Share (in millions, except per share amounts) (unaudited) Three Months Ended Total Variance Other Impacts (1) Adjusted/Organic Impact (2) June 30, 2025 June 30, 2024 $ % $ % $ % CAPITAL ACCESS PLATFORMS Data and Listing Services revenues $ 198 $ 187 $ 11 6 % $ 3 2 % $ 8 5 % Index revenues 196 167 29 17 % — — % 29 17 % Workflow and Insights revenues 133 127 6 5 % 1 1 % 5 5 % Total Capital Access Platforms revenues 527 481 46 10 % 4 1 % 42 9 % FINANCIAL TECHNOLOGY Financial Crime Management Technology revenues 81 67 14 20 % — — % 14 20 % Regulatory Technology revenues 104 95 9 10 % — (1 )% 9 11 % Capital Markets Technology revenues 279 258 21 8 % — — % 21 8 % Total Financial Technology revenues 464 420 44 10 % — — % 44 10 % Solutions revenues (3) 991 901 90 10 % 4 — % 86 10 % Market Services, net revenues 306 250 56 22 % 4 2 % 52 21 % Other revenues 9 8 1 5 % — 3 % 1 1 % Revenues less transaction-based expenses $ 1,306 $ 1,159 $ 147 13 % $ 8 1 % $ 139 12 % Non-GAAP Operating Expenses $ 585 $ 539 $ 46 9 % $ 5 1 % $ 41 8 % Non-GAAP Operating Income $ 721 $ 620 $ 101 16 % $ 3 1 % $ 98 16 % Non-GAAP diluted earnings per share $ 0.85 $ 0.69 $ 0.16 24 % $ — — % $ 0.16 24 % Note: The current period percentages are calculated based on exact dollars, and therefore may not recalculate exactly using rounded numbers as presented in US$ millions. The sum of the percentage changes may not tie to the percentage change in total variance due to rounding. (1) Reflects the impacts from changes in foreign currency exchange rates and the impact of a divestiture within Capital Markets Technology. (2) Adjusted and organic period over period change are calculated by (i) removing the impact of period-over-period changes in foreign currency exchange rates (ii) adjusting for the impact of a divestiture and (iii) adjusting for the impact of AxiomSL on-premises contracts for ratable recognition for 2Q24, which was immaterial during that period. Adjusted operating results also exclude the impact of the previously announced one-time revenue benefit in our Index business in 1Q24 ($16 million), which did not have an impact on our 2Q25 period over period change but does have an impact on year to date period over period results. Adjusted and organic changes are equivalent as they include the same period over period adjustments. (3) Represents Capital Access Platforms and Financial Technology segments. Nasdaq, Inc. Key Drivers Detail (unaudited) Three Months Ended Six Months Ended June 30, June 30, June 30, June 30, 2025 2024 2025 2024 Capital Access Platforms Annualized recurring revenues (in millions) (1) $ 1,315 $ 1,226 $ 1,315 $ 1,226 Initial public offerings The Nasdaq Stock Market (2) 79 39 142 66 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 6 5 10 6 Total new listings The Nasdaq Stock Market (2) 194 84 364 163 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic (3) 6 10 15 12 Number of listed companies The Nasdaq Stock Market (4) 4,238 4,004 4,238 4,004 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic (5) 1,148 1,198 1,148 1,198 Index Number of licensed exchange traded products (6) 422 373 422 373 Period end ETP assets under management (AUM) tracking Nasdaq indexes (in billions) $ 745 $ 569 $ 745 $ 569 Total average ETP AUM tracking Nasdaq indexes (in billions) $ 663 $ 531 $ 662 $ 512 TTM (7) net inflows ETP AUM tracking Nasdaq indexes (in billions) $ 88 $ 53 $ 88 $ 53 TTM (7) net appreciation ETP AUM tracking Nasdaq indexes (in billions) $ 88 $ 115 $ 88 $ 115 Financial Technology Annualized recurring revenues (in millions) (1) Financial Crime Management Technology $ 308 $ 258 $ 308 $ 258 Regulatory Technology 376 338 376 338 Capital Markets Technology 932 846 932 846 Total Financial Technology $ 1,616 $ 1,442 $ 1,616 $ 1,442 Market Services Equity Derivative Trading and Clearing U.S. equity options Total industry average daily volume (in millions) 52.5 42.1 53.0 42.7 Nasdaq PHLX matched market share 9.6 % 9.9 % 9.4 % 10.1 % The Nasdaq Options Market matched market share 4.3 % 5.5 % 4.7 % 5.4 % Nasdaq BX Options matched market share 1.7 % 2.3 % 1.7 % 2.3 % Nasdaq ISE Options matched market share 6.6 % 6.9 % 6.7 % 6.6 % Nasdaq GEMX Options matched market share 4.4 % 2.6 % 4.0 % 2.6 % Nasdaq MRX Options matched market share 2.8 % 2.1 % 2.8 % 2.3 % Total matched market share executed on Nasdaq's exchanges 29.4 % 29.3 % 29.3 % 29.3 % Nasdaq Nordic and Nasdaq Baltic options and futures Total average daily volume of options and futures contracts 223,450 251,677 240,133 246,527 Cash Equity Trading Total U.S.-listed securities Total industry average daily share volume (in billions) 18.4 11.8 17.1 11.8 Matched share volume (in billions) 158.4 119.3 295.5 236.0 The Nasdaq Stock Market matched market share 13.5 % 15.6 % 13.8 % 15.7 % Nasdaq BX matched market share 0.3 % 0.3 % 0.3 % 0.3 % Nasdaq PSX matched market share 0.1 % 0.2 % 0.1 % 0.2 % Total matched market share executed on Nasdaq's exchanges 13.9 % 16.1 % 14.2 % 16.2 % Market share reported to the FINRA/Nasdaq Trade Reporting Facility 47.7 % 42.9 % 47.9 % 42.2 % Total market share (8) 61.6 % 59.0 % 62.1 % 58.4 % Nasdaq Nordic and Nasdaq Baltic securities Average daily number of equity trades executed on Nasdaq's exchanges 804,121 663,897 796,426 665,183 Total average daily value of shares traded (in billions) $ 5.7 $ 4.7 $ 5.5 $ 4.7 Total market share executed on Nasdaq's exchanges (9) 71.9 % 74.1 % 71.2 % 73.3 % (1) Annualized Recurring Revenue (ARR) for a given period is the current annualized value derived from subscription contracts with a defined contract value. This excludes contracts that are not recurring, are one-time in nature, or where the contract value fluctuates based on defined metrics. ARR is currently one of our key performance metrics to assess the health and trajectory of our recurring business. ARR does not have any standardized definition and is therefore unlikely to be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or to replace either of those items. For AxiomSL and Calypso recurring revenue contracts, the amount included in ARR is consistent with the amount that we invoice the customer during the current period. Additionally, for AxiomSL and Calypso recurring revenue contracts that include annual values that increase over time, we include in ARR only the annualized value of components of the contract that are considered active as of the date of the ARR calculation. We do not include the future committed increases in the contract value as of the date of the ARR calculation. ARR is not a forecast and the active contracts at the end of a reporting period used in calculating ARR may or may not be extended or renewed by our customers. (2) New listings include IPOs, issuers that switched from other listing venues, closed-end funds and separately listed ETPs. For the three months ended June 30, 2025 and 2024, IPOs included 41 and 8 SPACs, respectively. For the six months ended June 30, 2025 and 2024, IPOs included 59 and 13 SPACs, respectively. (3) New listings include IPOs and represent companies listed on the Nasdaq Nordic and Nasdaq Baltic exchanges and companies on the alternative markets of Nasdaq First North. (4) Number of total listings on The Nasdaq Stock Market for the three and six months ended June 30, 2025 and 2024 included 914 and 645 ETPs, respectively. (5) Represents companies listed on the Nasdaq Nordic and Nasdaq Baltic exchanges and companies on the alternative markets of Nasdaq First North. (6) The number of listed ETPs as of June 30, 2024 has been updated to reflect a revised methodology whereby an ETP listed on multiple exchanges is counted as one product, rather than formerly being counted per exchange. This change had no impact on reported AUM. (7) Trailing 12-months. (8) Includes transactions executed on The Nasdaq Stock Market's, Nasdaq BX's and Nasdaq PSX's systems plus trades reported through the Financial Industry Regulatory Authority/Nasdaq Trade Reporting Facility. (9) European cash equities markets include cash equities exchanges of Sweden, Denmark, Finland, and Iceland. Minor adjustments to prior periods reflect data from a new consolidated data provider that accurately captures all primary trading venues and Multilateral Trading Facilities, or MTFs. 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Globe and Mail
28-05-2025
- Business
- Globe and Mail
Zacks Industry Outlook Highlights Intercontinental Exchange, CME Group, Nasdaq and Cboe Global Markets
For Immediate Release Chicago, IL – May 28, 2025 – Today, Zacks Equity Research discussesIntercontinental Exchange ICE, CME Group CME, Nasdaq Inc. NDAQ and Cboe Global Markets CBOE. Industry: Securities & Exchanges Link: A compelling and diversified product portfolio helps drive the revenues of Zacks Securities and Exchanges industry players. A rise in trading volumes, product expansion through prudent acquisitions and the increased adoption of a greater number of crypto assets are expected to benefit Intercontinental Exchange, CME Group, Nasdaq Inc. and Cboe Global Markets. Increased focus on accelerating their non-trading revenue base, which comprises market technology, listing and information revenues, infuses dynamism in the business profile of the industry players. Given his crypto favoritism, the industry is expected to get an impetus from Trump's second term. The sector is also witnessing increased retail trading. However, alterations in investment patterns and priorities and compliance with regulations pose challenges. With the increasing digitization of financial markets, cyber threats and data breaches continue to pose serious risks. About the Industry The Zacks Securities and Exchanges industry comprises companies that operate electronic marketplaces, which facilitate the buying and selling of stocks, stock options and bonds or commodity contracts. The companies facilitate trading across a diverse range of products in multiple asset classes and geographies. The companies generate revenues from fees received from the listed companies on their exchanges. They also provide a range of data and listing services to global financial and commodity markets, including pricing and reference data, exchange data, analytics, feeds, index services, investments, risk management, desktops, and connectivity solutions, as well as corporate and ETF listing services, on the cash equity exchanges of the industry players. The industry is witnessing increased adoption of crypto assets. Yet, industry players have to comply with a number of regulations 3 Trends Shaping the Future of the Securities and Exchanges Industry Volatility Fueling Trading Volume: The players in the industry are largely dependent on product and service portfolios for revenues. Major services include trade execution, clearing, settlement services for securities and commodity contracts, listing services plus trading, and clearing systems services. Sustainable trading volume growth, driven by trading volatility, fuels transaction and clearing fees (a major component of the top line of industry players). With Trump's second term, a pro-crypto environment and easing regulatory control, trading is expected to increase, which should drive higher fees. The maximization of transaction and clearing fees and the lowering of transaction-based expenses drive profits. Other revenue sources include data products and financial indexes, along with information and public company services. Increasing focus on accelerating the non-trading revenue base, which includes market technology, listing and information revenues, infuses dynamism in the business profiles of the industry participants. Per technavio, the securities exchanges market in 2028 is expected to reach $49.6 billion at a five-year CAGR of 12.1%, given increasing demand for various investment opportunities. Also, the increased adoption of cryptocurrencies like Bitcoin and Ethereum, among others, is a boon. Mergers and acquisitions: The industry is witnessing a continued surge in mergers and acquisitions, as companies aim to boost their organic growth through strategic partnerships or the acquisition of complementary businesses and technologies. These initiatives enable organizations to break into untapped markets, launch new products or services and enhance the value of their platforms and trade-related activities. Reports indicate that stablecoin issuer Circle is exploring a possible sale to either COIN or Ripple. In a recent move, COIN agreed to acquire Deribit, reinforcing its foothold in the derivatives segment. Such strategic buyouts are instrumental in broadening product portfolios—an essential driver of growth—and support companies in maintaining domestic market share while extending their global reach. Deloitte notes that exchanges are also turning to consolidation in response to shifting technological, legal, and competitive dynamics. Continuous Investment in Technology: Industry players continue to invest heavily in technological development. Focus on building a strategic economic market model via technological advancements and upgrades of products and services, AI in particular, will help all exchanges stay afloat amid changing industry dynamics. They are increasingly integrating artificial intelligence (AI) and blockchain technology. In recent years, the players have launched a number of innovative technologies that rely on machine learning, automation and algorithms designed to improve trading decisions while reducing trading inefficiencies, cyber threats and human errors, thus accelerating trading frequency. Players are also investing in automating non-trading operations that have an important part in revenue generation for the companies. Zacks Industry Rank Indicates Bright Prospects The Zacks Securities and Exchanges industry is housed within the broader Zacks Finance sector. It carries a Zacks Industry Rank #10, which places it in the top 4% of the 251 Zacks industries. The group's Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, reflects encouraging near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperforms the bottom 50% by a factor of more than 2 to 1. The industry's positioning in the top 50% of the Zacks-ranked industries is a result of a positive earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts have been gaining confidence in this group's earnings growth potential. Estimates for 2025 have increased 8.5% in a year. Before we present a few securities and exchanges stocks worth considering for your portfolio, let's take a look at the industry's recent stock-market performance and valuation picture. Industry Outperforms Sector and S&P 500 The Zacks Securities and Exchanges industry has outperformed the broader Zacks Finance sector as well as the Zacks S&P 500 composite year to date. The industry has gained 17.3% compared with the broader sector's increase of 3.9%. In contrast, the Zacks S&P 500 composite has declined 1.8% in the said time frame. Industry's Current Valuation On the basis of trailing 12-month price-to-earnings (P/E), which is commonly used for valuing exchange stocks, the industry is currently trading at 24.69X compared with the S&P 500's 21.36X and the sector's 16.03X. Over the last five years, the industry has traded as high as 27.94X, as low as 19.02X and at the median of 22.45X. 4 Securities and Exchanges Stocks to Keep an Eye On We are presenting three Zacks Rank #2 (Buy) stocks and one Zacks Rank #3 (Hold) stock from the Securities and Exchanges industry. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Intercontinental Exchange: This Atlanta, GA-based company is a leading global operator of regulated exchanges, clearing houses and listings venues and a provider of data services for commodity, financial, fixed-income and equity markets. Its compelling portfolio, expansive risk-management services, strategic buyouts and a solid balance sheet bode well. It is the second-largest global fixed-income provider. This Zacks Rank #2 company, with the largest mortgage network across the United States, remains well-positioned to benefit from accelerated digitization in the U.S. residential mortgage industry. The Zacks Consensus Estimate for Intercontinental Exchange's 2025 and 2026 EPS indicates a year-over-year rise of 14.3% and 10.7%, respectively. The expected long-term earnings growth rate is pegged at 13.3%, better than the industry average of 9.8%. The consensus mark for 2025 and 2026 earnings has moved 3 cents north each in the past seven days. CME Group: Headquartered in Chicago, IL, CME Group is the largest futures exchange in the world in terms of trading volume as well as notional value traded. Efforts to expand future products in emerging markets, non-transaction-related opportunities, OTC offerings, cross-selling through alliances, strong global presence and solid liquidity should drive this company's growth. The Zacks Consensus Estimate for this Zacks Rank #2 company's 2025 and 2026 EPS indicates a year-over-year increase of 8.7% and 3.3%, respectively. It came up with a four-quarter average earnings surprise of 1.7%. The expected long-term earnings growth rate is pegged at 6.6%. The consensus mark for 2025 has moved 0.6% north in the past 30 days, while the same for 2026 earnings has witnessed no movement. Cboe Global Markets: Based in Chicago, IL, Cboe Global is one of the largest stock exchange operators by volume in the United States and globally for ETP trading. This Zacks Rank #2 stock is poised for growth, given an expanding product line across asset classes, broadening geographic reach and a diversifying business mix with recurring revenues and technology. The Zacks Consensus Estimate for the company's 2025 and 2026 EPS indicates a year-over-year increase of 9.8% and 6.2%, respectively. The expected long-term earnings growth rate is pegged at 10.5%, better than the industry average. The consensus mark for 2025 and 2026 earnings has moved 1.1% and 0.5% north in the past 30 days. It came up with a four-quarter average earnings surprise of nearly 2%. Nasdaq: Headquartered in New York, Nasdaq is a leading provider of trading, clearing, marketplace technology, regulatory, securities listing, information, and public and private company services. Its strategy of accelerating its non-trading revenue base, successfully maximizing opportunities as a technology and analytics provider, and growing core marketplace businesses, as well as intensifying its focus on Market Technology and Information Services businesses, should continue to drive this Zacks Rank #3 stock. The Zacks Consensus Estimate for 2025 and 2026 earnings per share indicates an increase of 13.1% and 11.7%, respectively, year over year. NDAQ came up with a four-quarter average earnings surprise of 3.33%. The expected long-term earnings growth rate is pegged at 12.1%, better than the industry average. The consensus mark for 2025 and 2026 earnings has moved 1 cent and 3 cents north, respectively, in the past 30 days. Why Haven't You Looked at Zacks' Top Stocks? Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year. Today you can access their live picks without cost or obligation. See Stocks Free >> Media Contact Zacks Investment Research 800-767-3771 ext. 9339 support@ Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit for information about the performance numbers displayed in this press release. Only $1 to See All Zacks' Buys and Sells We're not kidding. Several years ago, we shocked our members by offering them 30-day access to all our picks for the total sum of only $1. No obligation to spend another cent. Thousands have taken advantage of this opportunity. Thousands did not - they thought there must be a catch. Yes, we do have a reason. We want you to get acquainted with our portfolio services like Surprise Trader, Stocks Under $10, Technology Innovators, and more, that closed 256 positions with double- and triple-digit gains in 2024 alone. See Stocks Now >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Intercontinental Exchange Inc. (ICE): Free Stock Analysis Report CME Group Inc. (CME): Free Stock Analysis Report Nasdaq, Inc. (NDAQ): Free Stock Analysis Report Cboe Global Markets, Inc. (CBOE): Free Stock Analysis Report This article originally published on Zacks Investment Research (
Yahoo
01-05-2025
- Business
- Yahoo
Nasdaq Plan Will Bring Zero-Day Option Boom Closer to Single Stocks
(Bloomberg) -- Nasdaq Inc. wants to increase the number of days that options on megacaps like Nvidia Corp. and Tesla Inc. can expire, in what could be a key step toward expanding Wall Street's zero-day trading boom to single stocks. NJ Transit Urges Commuters to Work Remotely If Union Strikes NYC Lost $9 Billion of Income to Miami, Palm Beach in Five Years New York City Transit System Chips Away at Subway Fare Evasion NYC's Congestion Toll Raised $159 Million in the First Quarter The Last Thing US Transit Agencies Should Do Now The explosive growth in the buying and selling of derivatives with less than one day to expiration — known as 0DTE options — has so far been largely contained to contracts tied to major indexes such as the S&P 500 and a handful of corresponding ETFs. That's because they boast daily expirations, whereas options on single equity names only expire on a Friday. Nasdaq has filed a proposal to expand those weekly expirations for a small group of qualified stocks to add both Monday and Wednesday. Pending an approval from the US Securities and Exchange Commission, options with those maturities are expected to start trading as early as the first half of 2026, according to the exchange operator. The move is aimed to help investors 'more precisely manage their portfolios and their risk in a transparent, liquid, and secure marketplace,' a spokesperson said. The step up to three days would echo the process followed with S&P 500 options. They also expired on a Monday, Wednesday and Friday until 2022, when exchanges including Cboe Global Markets Inc. expanded expirations to every weekday. That set off an avalanche of trading activity as investors flocked to the fast-twitch derivatives for both hedging and speculation. 0DTE contracts now account for more than half of the total traded volume of options tied to the S&P 500. The route to success with individual names is likely to be more complicated. Single-stock options are typically physical settled, rather than cash settled as in the case of index options. That creates extra risk especially for retail traders, who may not be aware of the difference. In the event a stock gets assigned upon expiration and then plunges overnight on news such as disappointing earnings, the contract owner can be exposed to substantial losses. In a bid to alleviate that kind of risk, Nasdaq is proposing not to list any Monday or Wednesday expirations that would coincide with a company's earnings release. Meanwhile, to ensure sufficient liquidity and demand, the exchange group is proposing only to provide the additional expirations for options on stocks with a minimum market cap of $700 billion, or exchange-traded funds with a net asset value of more than $50 billion. The underlying securities will also need to meet certain criteria surrounding options volume and open interest. Based on data from last quarter, Apple Inc., Inc., Alphabet Inc., Microsoft Corp., Broadcom Inc., Meta Platforms Inc. and the Financial Select Sector SPDR Fund would make the cut alongside Nvidia and Tesla. Nasdaq is opting for a 'very safe, slow roll out to see how things go,' said Jake Taylor, head of US single stock options at Optiver Holding BV, one of the world's largest options market makers. The move is a 'natural progression' from the success of 0DTE and other exchanges could follow suit, he said. While appetite for 0DTE options on single stocks is untested, the signs are that demand would be high. In January, almost 31 million contracts on single stocks changed hands daily, surpassing those on indexes and ETFs combined, according to data compiled by Cboe. Yet volume is concentrated, with contracts linked to 10 companies accounting for 40% of all single-stock option trading. Investor enthusiasm for single-stock 0DTE may soon get a partial test from the ETF market, where one issuer filed earlier this year to create a line of funds trading ultra-short maturity options on Nvidia and other retail-investor favorites. Those products plan to use what are known as Flex options as a workaround given the lack of daily expiring single-stock contracts. The addition of more weekly expiries would be 'a valuable step forward in meeting the diverse and dynamic needs of today's retail investors,' said Nate Palmer, president of retail broker Moomoo Financial Inc. --With assistance from Katherine Doherty. Made-in-USA Wheelbarrows Promoted by Trump Are Now Made in China As More Women Lift Weights, Gyms Might Never Be the Same The Mastermind of the Yellowstone Universe Isn't Done Yet How the FDA Helped Ignite, and Then Worsened, the Opioid Crisis Healthy Sodas Like Poppi, Olipop Are Drawing PepsiCo's and Coca-Cola's Attention ©2025 Bloomberg L.P.
