NDAQ - Earnings call transcript Q1 2022

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Operator

Good day, and thank you for standing by. Welcome to the Nasdaq First Quarter 2022 Results Conference Call. After the presentation, there will be a question-and-answer session. [Operator Instructions]. I'd now like to hand the conference over to Ed Ditmire, Senior Vice President of Investor Relations. ahead. go Please

Edward Ditmire

and discuss everyone, for us joining Good first thank quarter to Nasdaq's XXXX today morning, you financial results.

could are Zecca, Risk open up On our management team. other line Adena meaning line remarks, CEO; certain of events statements and forward-looking may as with Actual concerning from the reports our the press we'll during prepared Ann members information filed CFO; Q&A website and this of forward-looking projections, John complying the Regulatory to our Securities to call I'll and Adena. constitute material, presentation is results and are SEC from over factors release contained Legal and I'd the After Chief statements differ the Officer; these actual we our Reform Litigation and Friedman, may of the Dennison, disclosure Q&A. use the and relate XXXX. differ nonpublic turn under Private on now Act intend expectations disclosing of and in that presentation to website, and as our release results materially regulation means the press like such, to with you future The obligations periodic within in to information SEC. a that to statements and update. cause remind .

Adena Friedman

current by the you us. I'd joining addressing and landscape. like for Ed, my you, thank morning, begin remarks good Thank today everyone, and to market

has operating familiar can environment As I've past Nasdaq how with be. noted in today's unpredictable the become calls, team

and economic the experienced was certainly no The given period. first dynamic during different, XXXX we quarter geopolitical the factors of

in is in the resiliency our Nasdaq Europe specifically protect the tragedy, community comments, and calling we greater diligent a position proud Baltic operations global terrible Europe, monitoring with peace. and Iceland, we As I've client environment to Denmark, and ensure and which Latvia, includes noted markets solutions. extremely in public the across been operate our Estonia, a in of long-standing X and for war across urgently the and the business markets Sweden. stand has and in prior We've threat our Finland, countries, employees Nordic Lithuania to Ukraine

to ensuring we compliance was minimis, with and revenue all full de exposure to committed relevant remain clients Russian sanctions. Our

In support our is humanitarian me global and senseless war. efforts impacted see in the needs workforce support across philanthropic of base. addition, employee the with engaged highly our to outpouring immense by of fills the It pride to those

volumes moving, navigating environment, interesting markets. we in are navigate, been activities, a resulting supply business. across Regarding strong markets raising increasing significant dynamics against, and the on to and also are our IPOs. are where clients be a way very for an index markets, environment This the And challenges driver, tends landscape clients uncertain experience economic which It in U.S. including our creates corporate volatility slowdown depending capital the continued European we dynamic it and growth strong our shortage and labor backdrop to inflation, through operating impacts. has chain a continued investor and geopolitical with accompanied have creates volume our for investors creates to in

into market futures This inflows index offset by was products drop and our quarter, index strong cap the partially volumes. in

engagement because we secular times, it's impacts, solutions market our where increased have areas X uncertain direct clients actually help the beyond in navigate these Looking growth. client through we offer key that our

offer with are which solutions, Verafin. which clients bank managing in anti-financial risks, demand results geopolitical Our advanced we increasingly for strong crime complex

eVestment their funds wealth portfolios reliance are sovereign pensions, Solovis making changes allocation quick including on offerings. which and owners, endowments, and our carefully, very and their must asset increases Asset manage

the this means let as different our are our the environment through advisory that briefly Overall, forces of and play. in diversified demand drives at corporate broader gives inflation-related there address able And a which is be manage our context, for dynamic side, corporate a reporting the in of we to are recognizing, us navigating to certainly me environment, navigating solutions. the On ESG clients business factors successfully course, community. ESG are pressures, lot that which are model

the On the a financial world. the are benefit to clients, our we manage revenue serving mix and value for revenue thoughtfully. approach fortunate highly continue We context from creation around based to support clients long-term mission-critical solutions our and that shareholders the a to on providing our take will side, we broader diversified that in of system balance

across expense managing evolution inflationary the In of our actively addition, base. we pressures are

near-term guidance to current recruiting continue monitor economy, and skilled time. over to of team a situation highly retaining have actions address today's taken we we'll the and Our reflects the expense the challenges in

Our the on in The as record we secular drive has revenue this well model. very strength record continue as objectives. net business our business backdrop growth revenue dynamic model's opportunities our our achieved on team's focus growth quarter reliance organic to track Nasdaq's against as illustrates we enabled to execute longer-term components against the Nasdaq recurring of of

moment of take to of to our following in their announcements the be Nasdaq a leaders moving for X contributions like brief to impactful they that on I'd chapters lives. thank new years senior to Next, will their

Market years to our for want I Ottersgard Lars XX of business. congratulate Technology leading First, his

strategically the and the delivered products. Lauren orientation. dramatic transition a Intelligence during ongoing index thank successors segments. in quarter we technology Investment During years for our network client X the to more Nasdaq at the revenue strong announced excited now incredibly helped also a and and Dillard, Investment impact I of business for the higher about majority to the analytics who growth market Intelligence in in his advance from and We're want her scalable tenure, business tremendous repositioning features expansion that he capabilities a and led contribution SaaS-focused

Nasdaq X out technology Specifically, will to us lead track business. respected executive joined success. and market King, Those form businesses a are XXXX, Intelligence crime segment. who the Oliver lead to Investment our the expertise Verafin, will X Chai, business. Jamie of Albers, deep in with fields roll in who All record their Market in will anti-financial joined lead Roland technology Technology leaders the a long-standing from segment. continue Nasdaq industry will infrastructure proven

on Let's a results. We strong the strong very XXXX. now turn $XXX first what revenues. Nasdaq's very million a in previously when compared the record record was set achieved pleased to quarter revenues, report period X% of performance financial I'm to company itself quarterly to our a increase for prior trading year net a

revenue, of strong anti-financial growth XX% crime our and XXXX, first our X% reflecting of SaaS Annualized $X.XX revenues Our million company ARR, analytics ARR, in $XXX investment particularly total annualized recurring the quarter representing to or increased in businesses. billion. totaled total

results that Our both address powerful This consistent we uncertainties index revenues. for our well and start and trading geopolitical starting forward revenues the overall licensing in growth their recurring to the and economic but as delivered to year us move provide we strong performance, may also solid a positions persist across point XXXX.

our next business specific segments. to Turning from highlights

for $XXX base businesses crime investment and period, Solutions in ESG expansion the IR total increase a revenue anti-financial of XX% quarter, our issuer as and offerings; first several including our of delivered Our the the our listed demand million segment our businesses, of services. offerings, year driven index as combined from strong analytics well from our prior

period. $XXX total our organic Excluding of growth revenue we in Investment solutions FX impact of we In delivered segment, quarter XX% XX% the year and the segments. grew during with across versus our in prior the contributions Intelligence prior million the the X% partial first quarter, market Verafin in across business achieved year net business quarter. from our increase by an the Revenue period, acquisition, the data

period, principally itself. APAC ETP. flows quarter ETP the inflows the our Nasdaq in versus which In including the Index particularly outside year assets, the growth indexes accumulated Index in revenue Philex expansion, during meaningful the include $XX $XX growth tracking region, prior geographic which saw or of for $X.X XX% assets of remains XX positive ETP ETFs end Mara in we Nasdaq strategy by months, and XX XXX XX net saw the billion last last Notable through business, over Our over especially the Semiconductor We strong. of U.S. Samsung million quarter. the turn launched the launches volatile the in months, billion first driven

of and the quarter In Earth on removal on addition, our our based activity launched we the credits carbon first Puro the first during pricing representing index carbon created removal marketplace.

of period grew from owners, future XX% Investment from quarter. volumes year asset-based revenues the of with Nasdaq futures prior Moving Nasdaq index by were impact and in the tied XXXX. in across asset traded contracts a to And million particularly strong business, the throughout sales markets private asset strong licensed sequential the XXX XXX driven transactional, the the managers Analytics revenues our index of over to record

Executive Vice the Oliver We about the of of are appointment Albers Intelligence. to excited Investment President

is into the Nasdaq, instrumental segment XX-plus results-oriented growth, a is in an of Intelligence experienced, who in As Lauren supporting repositioning strategically Oliver you year veteran business Nasdaq's leader, technology-enabled see Investment today. more higher

next total Market segment. continued increase revenues the more the a by and the business. from prior results We anti-financial is the delivered revenues primarily $XXX to broader period. in inclusion growth organic Turning year XX% net million from driven year-over-year in broadly, Technology our first our quarter, technology in of Verafin crime This in

out the strong within and partial of crime quarter, Verafin the from new XX% acquisition the Our of growth quarter period, prior by partially existing which fraud technology as versus relationships first in well strong by Solutions. had organic our business was call that client year prior revenue write-down growth anti-financial The period, driven anti-money as the of and the associated base. the expanded a by both laundering, the year increase coming revenues sales in phasing FRAML majority very achieving with driven with inclusion we

on fintech our the into all client for meaningful of of as Tier made have several industry acquisition, signed X on Verafin in companies, banks X major and Tier Tier and well XX last as the of X concepts to underway have its currently we franchise Tier spend. clients X X We at account Tier which of XX innovative and expand with closed progress helping fintech larger months new X banks. Since the banks new we ports half objective

and traditional digital first laundering and digital our otherwise launched assets within asset banks digital money between to also service and wallets detect for providers, VAS, or virtual currencies. module fraud investigate transactions traditional and as and fiat crypto in including exchanges We known

invaluable ecosystem recent of innovating learning our Verafin supporting agents to from by is broader over have of our high-growth integrity all Within he our Jamie quickly as Jamie since other sanctions team first under important continue SaaS solutions to surveillance those of together we digital new the expertise our invasion example, communicated an for at fighting offerings. us Executive to same the synergies. the the at financial effectiveness product solutions. market anti-financial as Vice and Their to to Nasdaq of to our new By improve have the bank fighting high clients. past King, future the the President of include in And ASC reflect investors transformation as the Verafin, industry. build acquisition, revenue opportunity high-impact, is as business, financial Nasdaq's ensuring we we Verafin committed we Co-Founder results offering including expanding of crime advanced We cross-product the crime quickly versions solutions Nasdaq's crime through SaaS We're while began. the leads of the market technology the deliver by operational Russian are is of COVID to digital-ready bringing excited on to we our and responded that time X suite and Ukraine its trade infrastructure upon solutions, sanctions incredible as years our and meeting maximize quarter expectations have an the all Verafin Nasdaq's in provider set business time, headwinds of ways. and expanded focus CEO the to that the a

challenges headwinds often change we on As space. as that presented occurred delivery some and the include prior logistical these request discussed client well sales, from that on as specific challenges site, stemmed to in have installation calls, post-trade work pandemic factors the

good went beginning the the make in of projects. phase We post-trade all their our are quarter second progress of implementation pleased first clients X to live of successfully in and that implementations, our we with major of the continue

I to we're as in we these our headwinds As see reengage clients, recede. with last said person revenue starting quarter,

the as into intake trends solutions early XXXX, our XXXX and order both healthy we through organic an and the XXXX entered market to With progress improve XXXX. we with of in the growth opportunity year infrastructure

strengthen, areas relationships and exchange world's continue our Technology more Market customer the product excited business. it deepen had leader of about innovate several and progress a at he including I'm and product comes the our cycle our risk marketplaces. Risk We Chief Roland Chi time and solutions, serving as have leading has our of technology. digital himself in a suite. very Vice importantly, this next-generation, has as to our trade spent the the when newly meet leading client our to cloud-based Nasdaq than Executive built marketplace decade to Roland solution Infrastructure transition been fact, appointed to Roland President across more businesses Nasdaq's as specific technology was, as as has just of clients, offer life to management as asset cloud-native well to a technology solutions needs never trading Officer. at mandates new and key of And

to marketplace businesses. Moving foundational our

of its the $XXX highest quarter during net second only Our million second XXXX. revenues Market ever, segment to quarter, Services first delivered QX

in Our a capture. our well which maintaining uptick improvement, very the new improved while year-over-year and success an U.S. set share equity Equity high, for derivatives net unique options quarterly market early U.S. up as X%, resulted on-exchange in demand busy of saw trading in industry a our market functionalities. quarterly revenue period sequential increasing from as share in some realizing

high value setting Our with exchanges daily equities share. volumes traded XXX $XX.X traded with U.S. EUR number options decade million led during shares a of business Nordic markets, and period, market And saw and the first the billion. of XX% our Baltic saw in markets quarter a contracts robust during the average of of

XXX% Finally, prior IR services. our listings as suite, in U.S. markets offerings delivered across strong net growth European new Nasdaq from first and IR advisory saw as Insight and revenue quarter, solution. in the our listings management welcomed a for Report, Board and start quarter, as primarily particularly of competitive workflow million in Government Despite for well the quarter offerings the billion win XX% U.S. stack $X for across as driven Platform raising and Corporate an One new demand record leadership $XXX during XX XX% in Nasdaq the IR In We our Nordic, by and including and listings. our period, our company Baltic operating attracting in advisory reporting during Nasdaq First listed the North rate. well segment increase our all XX% and our leadership of ESG the continued slower of the year ESG its year our IPOs, in IPOs exchanges meeting Solutions XX listings. growth we Europe, to continued total

the As I to different in diversified demonstrate quarter our by model Nasdaq's how enables wrap that up, culture results I and environments. first will saying company well data-driven business performance-driven perform summarize

relentlessly positioning to support on investments Nasdaq focused As in also well us expansion a remain towards continue make our while result, we will advancing persist we the focused uncertainties I'll to We medium-term the XXXX. positioned the to as and that, we our businesses address economic strategy, our review as forward our sustainable Ann of turn that well and impact to to to goals. over may financial growth work With details. industry, the is financial in we geopolitical and move call believe now that

Ann Dennison

X% results the is Slide will X% XXXX release divestitures, the reviewing Services our reported The growth in section in $XXX as impact of the compared increase and beginning found by offset Relations in Investor unless revenue otherwise of net the first segment, Adena, year result file to our results of the noted. partially of XX% well in rates. commentary high all will everyone. Market as start negative decrease revenue of you, by X%, of quarter the net the our offset comparisons on located be including impact non-GAAP changes non-GAAP performance in million to and period XX record as website a FX My a I organic as quarter Solutions a be presentation. at Verafin from can net the and to organic from of in Thank on press U.S. first from contribution primarily ir.nasdaq.com. XXXX, a good partially in prior well GAAP morning, will organic focus Reconciliations in by increase Financials

or Non-GAAP diluted while to profit million operating per share, margins. $XXX share income increased year non-GAAP XX% $XXX to the Nasdaq X the of $X.XX in $X.XX operating income decreased and percentage to operating net year points Moving the per diluted or prior X%, Non-GAAP margin period. attributable to compared million compared prior period. was

XX. Slide to Turning

our $X.XX an an period, from Starting XX. acquisition of reflects crime by I of Adena an impact X% compared year the XX billion, organic near ARR revenues Verafin, XX%. period, through positive or year million, now As $X middle the margin prior increase growth, was business. segment occurred results first Technology totaled totaled segment while increased revenue quarter of in totaled the anti-financial Technology from SaaS earlier, will and of the million in $XXX prior of increase annualized technology $XX million the on Technology, Market of XX%. $XX for below quarterly our revenue X% The review mentioned primarily ARR operating objectives. to The with which period. increase increase Market led million, Slides $XXX well a XXXX, X% Market million the

segment million margin FX lower well $X X lower of points a changes of very and the reporting compared adoption compared and and strong of prior as reflects well was Platforms Corporate quarter a year headwinds results there million million XXXX lower as space. Investor advisory The delivery an expansion offerings. Focusing rates. period. positive revenue U.S. ARR compared in our to period. the revenues revenue to driven margin during Platforms prior year from first to including primarily was specific industry licensed compared points Nasdaq net or higher XX% million, $XXX million. segment revenue newer percentage was capture period revenues $XX growth post-trade decrease was as organic higher the XX% of analytics prior million net was is to compared was as business, reflects the The to year and index primarily impact from across Data. our strong XX% XX% decreased record period in million. driven $XX the listed Platform pandemic from Organic unchanged by listed increased ETPs impact period Intelligence reflect X X%. Corporate U.S. challenges on period ESG the logistical increased in XX% Market X% higher period. contribution the due Investment year of indices equities. base. XX%, prior and XX%, the the listings organic compared the growth some increased The in decreased issuer prior revenues in growth trading as the well Relations, year reflecting AUM $XX primarily negative organic and $XXX the as The issuer The as decrease Corporate Technology X%, the XX% growth. businesses growth of fees. $XX Services operating breadth presented to primarily U.S. or operating revenue The given and to equities U.S. as organic percentage year million from volumes margin $XX operating professional client ARR the period increase in Intelligence X% Market $XXX or revenues increased prior the Investment by to increase continue of Market Infrastructure or trading well the segment challenges the million corporate to increased base to

the $X by guidance. growth. $XX expand of expense, to Turning compensation, continues performance-linked the our the Inflationary which to both The from very benefits pressures partially to new Non-GAAP changes and on continue increased The continued operating our a rates. or is and organic capabilities in thoughtfully each segment. strong driven investing divestitures, offset employees expanded and to million the Page organic and acquisitions million compensation expense reflecting a to increase and we million net investment expenses $XX intend impact a from breadth have compensation XX in $XX $XXX X% impact reflects increase million FX base million. expenses benefits customer higher relationship. to across of the We of decrease review increase increasing developed reflect maximize and of our to by growth to drive solutions increase

to a to Solutions to lifting the are bit non-GAAP XXXX range the our growth to year. of very of start segment end range bottom for essentially guidance expense revising existing the account We $X.XX billion the $X.X businesses the billion, operating strong organic in a

the Debt of notes million primarily issuance due decrease XX. euro. values of by caused of to XXXX, a eurobond unsecured Turning million $XXX net March and by commercial X.XX% offset senior million of $XX a XQ Slide increased versus book due issuance million by new weaker partially in $XX a $XXX 'XX, -- to payment paper

ended Our XXXX. $XXX the non-GAAP June EBITDA quarter we ratio to April, XX total the months offering completed million unchanged from X.Xx, notes the proceeds XXXX. fourth the used debt of in quarter In first from retire of in maturing at bonds to period of trailing

dividend repurchases our to split stock a moment update our on the Now you stock. intention me and to let take

During shares, disclosed the million share accelerated related XQ $XXX in repurchase discussed the first including quarter repurchased of on 'XX, million to $XXX program call. the the previously company

start in company such Additionally, stock third approvals X-for-X a began as we also announcing revenues, can of delivered the a and a non-GAAP in of wide first a across certain process operating $X.XX dividend. growth of to today split revenue The we in strong quarterly obtaining company's build operating SEC the form are upon perform to record share. we of ability a XXXX. split moving reflect XX% the If what Nasdaq's forward. to results organic an XXXX closing, approvals that consistently We to be received, see an Solutions has dividend stock in of quarter and we per incredibly environments. increase quarter the are range expect to completed the the continuation XX% the In XX% segment shareholder margin, facilitate well

your for it thank So for Q&A. back to and the I'll over time, you operator turn

Operator

Instructions]. [Operator

Our Rich with Repetto first question comes Piper from Sandler.

Richard Repetto

growth some anti-financial you On get technology, segment. the market in great crime

guess can Could et I question it market within fell technology sanctions, with that then cetera. I the a new falloff. So the update be tailwind? the single the environment one you had from And project. even is quarter-to-quarter, how But on infrastructure you us And understand staying headwind the segment, off.

So could you give it us an to update? pandemic-related I know it But $XX million impacts. went you million like well. mentioned $XX quarter-to-quarter, as the seemed

Adena Friedman

I then Yes. with that about and Sure. Why don't actually start talk we'll anti-fincrime.

much the quarter-over-quarter, for technology allows us, infrastructure quarter tend a try to year in and market conclude is in other So that a Which us change call, seasonally projects quarter. to the during we the quarter. recognize fourth just requests of, have every to lot we that revenue quarter high we what because pretty then

for to quarter tends seasonally a us. high be that so just And

road. look could are have general infrastructure But at impacts engagement client I service the order still and as sales has I So Roland world our show starting that our you we that's market think recovery with teams. as traveling of the have a we the I We just our been XXXX a technology trend. the terms of of think in clients the Rich, did XXXX. has level but we with and are of pandemic in to on mentioned, engagement clients facing the general, in during level the of part in if again, our visiting we generally, more clients. We're intakes back business --

back implementations. good also level We're So engagement. normal a I on really feel like those post-trade progress more getting we making to of are

had our clients that. of As live of with go we've I mentioned phases in X first April,

also able terms people some deploy across the implementations progress other that So projects, in to projects, on getting helps just of of those but the past big those those us continuing also franchise. to being

can some of the a that of proofs the interest very the and concepts right that's banks, we others for some largest we've and that us driving they like we the can So pipeline normal of financial way. couple revenue more why They think, I does mentioned, time what problems anti-fin driving but understand our that the just with, a we advanced feel cycle. risks anti-fincrime we solutions help their start And a show so now, I quarter I that them then kind take regard what to up solve a the weekly you into to how an advanced general it think, this in sanctions it from that. have in through release for amazing. definitely ourselves as in team reflects sanctions, line. of back crime, right and cadence think will getting With And have interest companies -- the has have more business, that most have is is system think that the we're that that capability, is with near-term making launched other for to sure the the I banks

and had the really sanction upgrade in when clients sanctions they're update a to out to now. the able right product they So for the while sanctions, rolling to newest that the module and we've quickly hit, reflect were that the

that hopefully, looking give color the helps for. you're So that

Richard Repetto

I Adena, helpful. pipeline. it you just I it to slowed, follow catch listings I you bit -- talked Yes, CNBC, do And know up. give like a us could didn't here, a it's backlog all, seems have I but caught very guess. IPOs about have you on little the but

Adena Friedman

Yes. backlog. We have definitely a

file the just are are on SEC there go we Nasdaq. now, are the track -- we S-X in filings, that right now, look to -- right if that think to there have that XXX filings. And I active filings S-X

last time at XXX I filings that's the same think that versus year.

public looking remains So the number strong. go out really of are markets companies the to into that

and is with new that. need IPO environment now, they're tracking are where, feel new public go the have I take interesting We right And right environment that really the investors great think opportunities. to they that's and some But just large-cap on to engagement ready that to risks issuers.

couple the future, see the listings behave -- it makes harder in markets have we'll of out think for kind are of environment are which volatile, markets we that but But later them. harder to a might bear I how and see for inviting and how those come the the not hopeful them for this an makes take to or it's we predict it markets to that quarter, whether investors risks. it

Operator

Craig comes Our Bank with question next Siegenthaler America from of

Craig Siegenthaler

doing all well. Hope you're

Adena Friedman

How are you, Craig?

Craig Siegenthaler

I good. am

of I Rich's more the a market be So contract cycles lumpy, question infrastructure the sales technology. headwinds and what you this longer in working in following that And fade? expect more follow-up experience live normalization and the go type had as When can acceleration can then logistical wins clients to be to environment business on you revenues too. understand do could

Adena Friedman

Yes.

infrastructure, have want providing specific and we've guidance optimistic demand which there proceed. to to that continue of that we things or we modern you upgrade implementations, the we sort through on I the in new lot them. say continues is feeling -- not post-trade a sign around exchanges that we're are help had more from of on are to But And getting a gives then, now course, So solutions who really to more what that see how clients, fact would can big -- big modernize allows us their to really poster of of outlook and post-trade confidence is we us and area. be push any the some these

some those of good that key implementations. getting I So we're think past that's

-- Phase we I. Now are those

'XX. think that -- we -- we be start a the get and into implement clients recognize that how to new their because profile, time say allow we -- But margin and these I multiyear have going into also that would go to get Hopefully, later a these take think the are tends we implementation our that it get good and clearing clients. on progress sure that it you in sure solutions. takes these we X to still are some once projects to we just group pipeline But want revenues, have you. of revenue, us them. start that I And to moving that we and you projects and with does continue are long though, to important, said, in But on helps you as that's, show can I time, into feel have as for new still that to change long place. that in get and making we say we to to can into build next different I of service can deliver 'XX are that we who -- you and license They projects. make the post-trade work really maintenance So to into cycles Phase a

Craig Siegenthaler

helpful. Very

on for For within my in this to to we on should equates also based follow-up, XX% you revenues And how in was trade Can Nasdaq increase investors and indexes of terms nice maybe and options this how think math the works. see the also year-on-year more quantify about what trajectory refresher index? as indexes. futures growth the a it contracts options Nasdaq accelerator

Adena Friedman

Yes.

into go I'll question, the answer first then I'll So and trends. Ann the longer-term let

Ann Dennison

Sure.

about much. how So your question Craig, on

X/X So level. can at the And some what accelerator. is is related question is we the about look that and the to index X/X futures, say on asset specificity that data. index your you of don't just if plus business based holistically, at the But other give I

about an hit during I certain accelerator this we've contract, So kicks we when levels the in out fourth our that In think year. coming we of talked the quarter. have

the X midyear, that's of For June-ish. past happened sort end years, of

quarter to that see as towards sort the reduction assuming we see same at then And of off the the a in fourth volumes the level And quarter. drop. And coming of first up the pop shared last year, was stay the middle we'd so of related I year. number we they were think out did in coming accelerator

Adena Friedman

options, the in investment how market terms Craig, understand really into to the I And Volos index the our investment Yes. build XXX that's really leg institutional strategies. small that part called a have question, we an or their options area Nasdaq build. in that helping options it's great And adoption that have and business revenues, we that's well. as investors Nasdaq think working of XXX their of to as that's is hedging index And helping an because services Index great with options relationship a start-up

Market a that we that business. that have really as Services still a there. us us I and the we And early But in so growth in area lot think nice for of building front see ecosystem, really up opportunity we're of in

Operator

from comes question next Our Oppenheimer. with Owen Lau

Owen Lau

ESG to reporting? including your maybe ESG investable and IR on continues and Could you So please products bit the some revenue ESG and IR higher. grind a little us initiatives, update give an

Adena Friedman

Sure. Yes.

X really demand. demand. Retention good does Well, and actually: things it there's reflect that just think I

year-over-year, then, nice continuing that a client platforms drives done really So I team think of bring on allows focus the to sales, to our up retention growth. which course, really corporate of the has team which . job

continue and have is really think that products they are retention that enhancements our in truly certainly so have the reason we best-in-class we to for those I we invest capabilities the product customers.

good so with only because just And of still, more just really on tools some I them those out, got And to I communicate of environment, part do a the is XX% really figure economic feel a that the clients best kind with And environment, do driving really kit out and changes starter fee. interest or this them are that demand realizing unusual out. great than the companies packages of But with and the the our SaaS a I think Nasdaq that ago. point that services, and that area lot services. say, that's front, job also we a of that investors all that's how navigate the I can we are the the additional makes kind have geopolitical nice I also And but team after to think roll second help of the what's political with off demand. had combination we a I what Board, investment to advisory environment, kind software offer, navigating corporates listed our we also a our advisory of Those overall in them providing operating really as to you've there. to think lot it. of investors. those for trying not on we of call think a great X does we that figure there about solutions, of of a of really your an driving package, of and IPO And we would that maturing. have capabilities help offer years. is team are should the it that's through environment ESG we for engagement there's the lot obviously year services also what's environment But lot today

Owen Lau

And I then it. surveillance on an your I'm crypto Got clients give can wondering mentioned think some that. using and were exchange there on on please update offerings? previously, solutions. us you us just if you your crypto, you could more give update

Adena Friedman

Yes, sure.

right. you're So

help their that's I to So trading of a our Bats has And think somewhere digital and efforts. surveillance. crime both the banks assets help have in anti-fincrime technology specific really module for we built to mentioned, we I range about leverage for team anti-financial and it's crypto exchanges also, dozen manage a that then the then traditional as

quarter. the that we're crypto then rolling So index out we our we've second excited also we're launched. that products in have And that

in we institutional And that our in find so maturing, in expand space over is offerings continue can Owen, how crypto evolving, space. And how to it's the coming general, time. understand continuing how to watch interest to engage, it's how we like to to ways continue we're much

Operator

next with question Our UBS. Alex Kramm from comes

Alexander Kramm

question also ask guess companies split of Nasdaq-listed much companies there's announced other trading have want with you're one. that joining a about trading are of volumes that bigger a for other But today. I terms lot the lot in announced of a I to stock splitting.

I side. question. volumes that helps is a But this your So obviously, the equity on Nasdaq-listed I assume would no-brainer guess

talk maybe you people think your higher-priced options also on price traded. what a narrative can interested I in share stocks then to this for importantly, I means using more I have this probably cheaper that. options But to into would contracts means in way. been view volumes. get So just But lower be there's that guess more

split options. done magnitude wondering just you've work if on from equities any and could stock So mean both on what that

Adena Friedman

Yes. Alex. Thanks, Yes.

we splits into that because probably more should correct are happening, that investors you having bring with tends that just shares own the through stock that, investors stock our think fractional that price to that share more stock. market of It directly say should the trading of that has that a true all on research lot benefits investors, which to it your helps idea think, tends companies. your spread, allows all, economic a have department investors to So more structure we I is off are is I offerings a drive to evidence around And that are opposed there and and to it exchange there to these tighter first bring as exchange. helps done

Europe, in see it traded. do we net the on correct positive. in get that also as a paid the U.S., So not we U.S., shares But but you're in

in traded So that countervailing listings those increase if significant But a are with options. force large splits, shares the does partial it do stocks. is there

lag money for a option as without an So the interest having kind are in would stocks the really and investors pay of of in retail we you to lot in way a to are that correct also seeing share. high-priced stock each demonstrate

the positive there the that in market, So better might share structure there but options volumes. downtick that, price, speaking, some slight increase is see say to versus generally net see the the in it's would options market we some offset you in a the

Alexander Kramm

Okay. Helpful.

Secondly, on and financial Verafin crime.

growth total I organically year-over-year, where I XX%, strong how we've seen Verafin think how give you're about or talked think tracking? or those did us that some in crime financial Can either did at you organically. numbers, rates, XX% businesses still being you specific

Adena Friedman

Yes.

So the talk because one. that level cover we'll we what let to but think Ann thanks. going about that's Yes, I'm I today, ASC report

Ann Dennison

Sure.

that at both our and look we was there when growth businesses, the So look market includes total, and organic at -- in Verafin AFC trade XX%. you surveillance

first for If quarter that the deferred you organic of versus write-down, last growth XX%. the sort revenue adjust was year

it's So healthy a very that numbers in business. combined

Adena Friedman

but could we Yes. thought close we us of it kind to a and nice little And XXXX have when in acquisition, we of is into think continue color quite into generate the above think $XXX this to of growth, of really the at the just brought $XXX I position. exited million, brought million And which we revenue kind indicated specifically that point on year to that year other we one in us they into went strong add I for that, range business. Verafin a

Operator

Our Dan Jefferies. next with comes question from Fannon

Daniel Fannon

equities. happened. thinking particularly pricing for within your trading. around we the follow-up this that One may think in should fair into this rates may capture biggest of about the of some changes of quarter, to I about But amount hard have any rates classes Capture asset forecast. not How current terms know on or predict business moved that's today, a mix year?

Adena Friedman

Sure. Yes.

I just in So the trading. change on U.S., there. is at mix equities One a there are think X in of the play forces

that, more I year to we think, more behaviors quarter, resulted a first the last year this in has and I that in rate capture which more trading volumes, has trading different So first retail the it. quarter, institutional drives mean had just then markets. just lower intraday actually

of that's the component, mix just trading. So one

volumes been certain though, activity focused into do, on know, it's a have is, to that the drive and ways. we drive We look in volumes. us in markets at for pricing monthly like trying we you pricing second use The as how to to

you up fourth our the a was to we in I which QX. think In what -- OCC. put year, fruit to And think then some have of up in in the started mentioned capture our -- to we at bring it go of beginning fee we've -- And share, expect you saw holiday, end payment a drives I some And have the we down stated we the incentives at the we I make then to -- they parts market as which well. come price. up tends And also involvement in before, increase other in we in programs our that institute, this options that functionalities. and in options, some again, certain on I at did little that's markets lower did. hand, showing more think it as then little the had some has retail bit less we mentioned retail a so to show bit a participation come are, institutional to also in QX, of quarter And of terms more quarter, bear which the saw

just options by bit change that a went little mix. our up in So capture

Daniel Fannon

And around helpful. solutions That's just in change business. on clarification the expenses the question it. the reflecting then a Got the guidance, strong and growth across

you've think talked Verafin businesses other growth. some doing obviously about and so And you I well. budget for But

far that specifically So early expenses, to guidance your tracking in change which segments the the get above program, which are that I wanted budget this in the would is really that year? -- driving

Ann Dennison

So Dan, I think it's fairly straightforward.

for growth. Solutions talk being segment You can medium-term We the X% as it. think at our in to outlook the X% aggregate about about

quarter, this XX% so collectively, so to And we X%. put up that X% organic growth, above well

think And about it. how we so that's

Adena Friedman

platform top are to so -- to the we increasing mentioned also of terms before, parts bringing we up and it, range, corporate mention if think but the the you as to space. the space I in and actually not bottom just it's coming show investment different space, expense -- in our of that a we're and of the in business. anti-fincrime are continuing it's at in of we across the fact It's look it's intelligence the Yes, is, guidance end lot and -- invest

sustainable. sure make doing clients, with so areas to are And we and those we're really in want well engaging that's that

service the growing to job we're investing to doing our and making So client base they sure our clients they're do that our successfully. -- growing in need that teams

Operator

Our comes Sachs. with Alex from Goldman question next Blostein

Alexander Blostein

you there quarters to that I market well. Nasdaq's how optimizing for the important dipping to from what I time, start newer how focusing keeping the business some business few extent headlines into of seen that a years? north kind exchanges and on the now, impact light to guess, the share market over guess that of market and is of But a around of forward about, tail pricing couple Nasdaq space. thinking over share, obviously competition next over rising seen revenue marketplace of we've and here? for of multi-listed competition? their I are XX-ish has job A this sort slip in We've exchanges, in revenue around last percent option So question kind nice really as done great Look, share think and And in perspective. stay going you will capture rates place it which quarters is

Adena Friedman

I been mean would auctions through really I time. long for we've a managing Yes. environment a say dynamic

exchanges, XX there XX less options are think that like options I exchanges. So for

the having just part exchanges come is ecosystem of in So today. options something that's additional

think of in really really what we as markets manage attractive terms flow how types that that, about of that thoughtful of in are kind you said, optimally think I have. of we we -- we to is terms the how us

look really we So at it.

and investors We We through pricing we can each those have most We can exchanges. exchanges. traders and complex of those think X GMX have through about traders IC each individually. on And basically others. come the MRx allow and participants and retail to basic types options Philex exchanges in of the most in to of for options in different come and

serve are So we trying have sure and to the platforms to we what we our of try right to want really them how kind we platforms, way. balancing make with hard, that what achieve investors in Alex, our we're

those on but more traders. the I have the complex platforms capture, think lowest competing they serve really necessarily that don't really coming exchanges the that are newer that are lower-end in

think also that say would we them. I or thing focused a bring we having last franchise assets our is is options really that we proprietary thing different because have part we have do can to on some that the markets the options interesting our think product into our I do really characteristic are markets of

competing in well. quite to build product that I trying really our always to addition will do So well, we really as we up we franchise that proprietary and think also are and actively,

Operator

question next Bank. from Brian Bedell comes with Deutsche Our

Brian Bedell

focus Maybe just back crime. on anti-financial

the a in Now that more the whole businesses you sense of us look unit? with the that can agents monitoring, digital also of a XX%. with for you've growth on Obviously, sanctions and anti-financial you give growth Verafin anti organic as growing Jamie, wallets talked of -- was and crime surveillance legacy Verafin synergies sort combination and cross-product sort the more about at of at under crypto Verafin with obviously, those in what But just did would of growth entire synergies see this a since the to projected acquisition. it it you at that medium at a that for there -- sort term the grow of industry-wide. at type I -- outlook that you unit rate with least you did that improvement the -- given in was if time, combined know was XX% segment around when was

faster think Just -- getting be for get sense a X sense to whether could trying next years? Nasdaq X of the that moderately to a rate over you

Adena Friedman

Yes.

plan. take that that's because surveillance that smaller the such think product well of all of as Verafin Market how that. right think being all great work in is successful had that at outlook doing infrastructure do XX% lot on with all really the -- as speaking, build really overall think of the with clients a strategy doors general, technology really continuing to done with opportunities medium-term things These the now, how you the for XX% you've integration we're I business, excited has for integrated, Technology The But the we the even are which engage acquisition, job But interesting the terms a are could are in where market on to sections really take what Verafin product . for relationships sort we an will generally to multiyear the anti-fincrime bring Any that Verafin think, of we of started open firms. after opportunity, that the surveillance see have I to there. teams to pipeline the to larger leverage business touched away relationships space. to how Verafin And on to includes they've our the on. more of doors within So about open come that anti-fincrime time, they've we a together. to we client teams right? But have us -- to some clients, into market for I growth. together, means how and product teams to optimize we

outlook in tech the we growth. we're And we we anti-fincrime, think market with some doing But success of so we'll at If -- support the would to anticipate we find the doing XX% work consistent how everything are business there. or really look not space than XX% the see that in developing. make helps we're now, of right number having or earlier in that anti-fincrime adjustments we overall I that's whether more is that success that

Brian Bedell

timing Okay. headwinds be enough. and Intelligence? do That's is And that lapping yet? that also or the maybe able be the given And and revenue fair you index the on in Or all talked of infrastructure not to that material if I that may longer-term on that year-over-year licenses of by on answer grow Investment revenue about you about. you third market just in a And development? growth this. you contract, think may of the can then quarter ask that quarter? more now you segment through But then side, licensing fourth the part talked that the just just Will seen crypto is can index

Adena Friedman

been any through end and kind we Well, that about would don't say in take that like we X Sure. intra-year of contract of that June. rolled of off year, I you July outlook that we talk mentioning so But particular that roll-off last the lap that have as had business.

strong intake intake engagement. perspective. good year. order a record I we are had We've to think from last year We've seeing had an start the that order

have give And feel guidance obviously, like signals will outlook But that don't good so the we we that. on to business. opportunity are do there intra year that or we grow

XXXX. of the And already it crypto revenue outside an index it product, believe, and in. that's we incorporated was actually, revenue terms beginning but it XXXX, generating it indexes, In for the or into is U.S., the nice maybe of maybe I all based that sector was for the that's launched us, actually index

not significant So grower, mover. I say context want to just that hopefully, today. it's not it's nice is not -- the big It's that. but a huge It's not a business significant. in how hugely of a

Operator

Instructions]. [Operator

question Michael Morgan Our from with Stanley. comes Cyprys next

Michael Cyprys

maybe you AWS ask Services migration wanted I prior to on I over the to I what are might could get a us you've sense that with calls. update doing and the cloud. us of some forward taking cloud? and on deploying as of that of you moving to But to some about overcome challenges comfortable steps partnership, you're the able to facing the some of And spoken just the Market key hoping know the about there any there? the was you're those you're of And be of AWS challenges deploying give partnership. you're sort to just and the the what of business

Adena Friedman

Sure. Yes. Michael. Hey,

about in it's didn't that the we mention because quite thanks But moving So along that for script. well. asking

today. options meantime, to -- mentioned, our clients team as migration. market that our implementation our platform with to expansion have AWS. this Equinix that are our a so our team, the with going we with But to our we is we of data on AWS And And that and to deploying partners our to center because have presence groundbreaking to our MRx, one local data what then our our of private Carteret expand come I which it Outpost is team their deeply solution to track with because and our XXXX, that for to available continue done But over on think do in of ground capabilities clients, development our really expand in outpost that sure make make take infrastructure beyond we that are I to create year. and engaged years we data it's center. there couple us May They're heavily we're we engineering is That online. we're the and investment -- engaged before we into to the can participants MRx new that that's goal migrate and exchanges, think the of more zone will ecosystem be X, it breaking on center. is, which are offer that to AWS to end allows Fusion at are going is

all. on learning go spectacular We're for And so that any are as we're that. major track our aren't think at with so a There we been I partnership challenges progress impeding that sure, far. it's but

Operator

comes from KBW. Our Kyle Voigt question with next

Kyle Voigt

if you notable form you more pricing if and if other the any if I'm nontransaction run other adjustments. tell consider price have levels, wondering you just or elevated changes start wondering could Just continues us in businesses or adjustments make to than other adjusting to CPI fee listings at you of business historically changes the XXXX your inflation in across

Adena Friedman

Yes.

business. in or in small -- So now provide making to we few, a the this on we last -- to the basis, an fees year, continued do listing reflect we're every change our that we we investment annual

And so have that and did in we we years. as that prior --

So there was difference no there.

I think general, work cases, do we're clients adjustments some pricing. other or that with done have but we the we have same contract to value clients understand we I flexibility, we time In In though, -- our upon to products. our to CPI we have at have think cases, don't our on annual look providing some way over to environment, renewal. that the engage in the inflationary the

we our as in that are as and I mentioned we them the approach sustain But of proactive to long that clients can remarks, take so over shareholders term. the do then, being long-term accrues over And the that. my so as we evaluating clients, benefit to clients in course, long the grow a them term certainly of

Operator

Our from Sawant next Suisse. Gautam with question Credit comes

Gautam Sawant

available in and are types an announced launch what they launch? to a quarter, What the are to opportunities During sustainable And of exchanges internationally? was credit Brazil exchange. engagement looking other assets carbon

Adena Friedman

Yes.

Brazil. agreement technology a the we was with in signed client that So that actually

job, And really area high-quality The is of world in So and really Curo we us. an suppliers that. removal carbon Earth, to called us small. we upon for platform. really do marketplace find think have carbon global excellent been a very but actually I that It's interesting credits we and have a removal based rely a a ownership it's companies XX% which it in the largest Finland, is in

a is world to certainly But companies So in growth the talk lot a it industrial us around we high-quality removals, carbon also car yet. into through output Europe for we're removals. don't moving it engine and their help carbon about nature-based manage

for engaged an we up the we're using to markets, are can as and then our markets. opportunities with area of other we tech course, carbon on some those our same also, clients, of clients their these an we're launch that's So open engaged markets And technology other in. for really to operator, ambitions provide offset

that's want say see I days, I of more think time. it's over just early I right. though. We you'll very Well, that the All So all -- think to questions.

much your demonstrate how in first continued And very a So I look results thank quarter time we're our to start for progress. Nasdaq's our strong the you regarding XXXX, throughout today. off and year discussions closing, forward to in

very much, you and thank So a have great day.

Operator

concludes This call. conference today's for Thank participating. you

disconnect. may You now

Nasdaq (NDAQ) 20 Apr 222022 Q1 Earnings call transcript