NDAQ - Earnings call transcript Q2 2022

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Operator

Good day and thank you for standing by. Welcome to the Nasdaq Second Quarter 2022 Results Call. [Operator Instructions] Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Ed Ditmire, Investor Relations. Please go ahead.

Ed Ditmire

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

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

Adena Friedman

acknowledging dynamics. like XXXX position to drive by joining and levels corporate to experienced excellent Thank ability I’d strength to forward us quarter geopolitical and the business remarks of uncertain while and priorities My and The us. environment. that for for an have an Nasdaq’s businesses find will we as morning made today these progress you, markets, the on quality well execute strategic increased investors macroeconomic our clients you our and volatility we to Yet it to in good second on financial Ed clear. and thank as navigate continue quarter, begin second performance ourselves remains our focus Nasdaq’s everyone year. strategic during vision and all of puts amid the

non-GAAP longer dynamic net opportunities Our even for continue and our on to investments. in our strengthen I delivering growth positioning this environments focus results backdrop. against proud focused our to through revenue of as ability our record capture term results we EPS different new am to operating clients team’s consistent demonstrate

to increase prior $XXX a quarter am turn second achieved an very Nasdaq’s year to the changes financial We of net and rates excluding I our results. and compared pleased million divestitures. to report X% acquisitions FX basis, period record in strong for performance impacts XXXX. X% a on and in Let’s revenues, and the the organic

for X% even Our the strong an growth demand of our in strong of SaaS our across total revenue revenues. segments point but our delivered powerful a are also licensing for million total recurring our quarter $X.XX ARR, comprises provides new anti-financial billion. sorry, recurring we Annualized ARR, and trading of results to which second overall consistent XX% high. revenue, annualized The – revenue now in totaled seeing solutions rate analytics faster starting $XXX offerings. or and index revenues investment a performance, we at growing XXXX, company XX%, SaaS increased with crime reflects

increase the increase the period several and activity our demand year as was during delivered a ESG our segment, across total in XX XX%, business $XXX of growth business, XX% our our driven across combined from flows and index XXXX. X% X% index during positive the or quarter. revenue In second Turning environment and we increased over Investment segment IR prior in prior the for net or well the our our by beta next Revenue due excluding prior revenue XX%, FX, revenues with growth the as year the and XX% the $XX versus excluding $XX million of especially year our overall primarily proprietary from an challenging analytics In of from billion inflows prior delivered increase FX. in we by experienced total the excluding period during segments, base, first anti-financial international issuer data to market saw the impact last Solutions quarter, the of from impact offerings, offerings, FX period, half services. listed Intelligence contributions of billion including from months, driven businesses to $XX including our from X% the million year quarter, data of of our expansion of strong specific businesses, an second period highlights our of The clients. of in the million the revenue the impact business in growth $XXX from crime

activities, impact in XX% than together negative inflows, X% which the especially grew more prior market and the analytics also revenues period results features license the year FX. impact beta. of of We with offset business, strong from saw excluding And our from

Our versus user flagship the period adoption, to managers Intelligence increase to revenues owners eVestment prior asset SaaS analytics segment million. drove and offerings our the Investment asset and for $XXX XX% both saw across annualized continued strong year

prior broader driven delivered quarter, Turning from our XX% $XXX revenues the technology in business. million in our This continued period. a Technology anti-financial by second we crime Market in was solutions growth next to year the increase segment, total primarily

our anti-money second sales crime increase strong what deferred fraud anti-financial driven solutions, quarter business period. adjustment the XX or XX% as second welcomed period. quarter. a Verafin in revenues revenue impact Our with in a in during of versus had laundering, by the clients year – We acquisition the prior and was the technology prior in the the year as well recorded Growth new FRAML call we

These are momentum client’s to active trials. with proof-of-concept Verafin’s and evaluations expand prospective banks infrastructures. with continue efforts within through Tier to X our We gain our our presence X Tier compliance larger

cycle, a important purchasing to technology in of our our an step process market. solutions area relatively it in this long diligence success to the drive is extending this While results

Technology in Market second business, generated we quarter. during net Infrastructure our next Moving million $XX revenues the to

Importantly, clients projects to we of client that within deliverables quarters, in increased discussed on ability with recent on work the progress site. our we have a group made particularly continued reflecting large

Specifically, Phase end we completed four X by the the all of deliveries largest our implementations for quarter. of

credits, the also phases, financial provider far products relationships some While period. follow-on exciting so their which which have platform technology the the solution exchange that for some slated and Infrastructure as decision trading Climate is of for important next-gen new were Impact announced leverage of assets, had services new their Nasdaq’s carbon in Nasdaq’s Singapore-based projects milestones leveraging announced services launch XXXX. have met year. platform in to for a of SP, announced are these we Technology June, a cloud. early digital marketplace this for Market In during is marketplace a new SaaS deployed in carbon SaaS-based May, to In development to credits, pleased the power Brazil spot X, their

contemplate incredibly as marketplaces new clients and deployed As improve into overall particularly customers noted of of in recently Conference. as and through to I can see XXX Future advantages bring over Technology earlier, in market and XX our to engaging We to infrastructure the The XXXX. offerings. in from solutions, remain their ability the confident actively differentiate officials welcomed for including person look shifts respective the cloud our XXXX the organic Industry that growth they clients operating our technology, their models their operators was ways our our encouraging, global Annual to again we remainder sentiment from there team the are with our

by billion The a Reconstitution, a last year’s $XX to result June, from revenues the X% were shares executed I record achieving technology in event. services. we yet number Moving two an The seconds prior investments in the versus XXXX robust in quarter. well. maximized and reflecting our Nasdaq’s market quarterly levels demand businesses, also of in across XXXX. our of a through Nordic $XX the for million Nasdaq-listed investors, of share prior of to for has of some year markets of representing nearly build on incredibly a presented the quarter. Indexes testament our X.X shares by consistent billion compared saw XX% crossed securities, Russell the Nasdaq’s XX% the on diligently the Exchanges to our this services strategies. milestone. to trust Services worked a Nasdaq up year, value Nordic record have on new the share proud marketplace high traded market traded team is end highest of revenues of am and during all increase periods on with markets segment equities trade and U.S. $XXX volume Nasdaq’s Closing delivered record. hit half activity through the foundational of volumes Cross the during including Closing and second shares, made strong our important opportunities services market first pricing shares Market the connectivity as most for traded At management increase volatile the was Baltic And XXXX since team infrastructure Cross set second The We net new strong grew of million,

our number services primarily our clients been and expanded our year segment period, Nordic and U.S. our the quarter, relationships technology-based demand in for using listed clients. solutions increased well increased the bases Revenues year delivered from second our X% IR The services. listing services our ESG strong prior demand existing as IR prior in million you across Nasdaq’s period. and a the the of also XX% and issuer of consultative corporate have $XXX in while and as both Finally, ESG revenue X%, of from Corporate underscoring IR Platform for solutions expanding ESG the driven during increase franchises period, by growth business

is quarter, Metrio, expanding solutions and accelerate services reporting corporate their In addition, Metrio’s corporates. complementary sustainability data and of support IR of will we sustainability I reporting clients sorry, and our second the suite needs. reporting management platform a our and of analytics during corporate – ESG to SaaS-based existing provider to am to ability acquired

growing G managing more the all expertise complexity their us to investor including enable modern Our relationships markets, and navigate corporate E the in capital of S of our successfully. components clients confidently help

of raising X% increased Nasdaq-listed new the Turning SPACs, welcomed for Nordic, North and issuers, year an in to as IPOs billion First with In the rate. XX U.S. number corporate exchanges also to excluding the million increased to consecutive attracting its business. combined $X.X quarter, new compared win the our competitive for XXth Europe, Services listings. Baltic of majority continued XX listings a XX% period. Revenue Nasdaq our prior leadership Listing $XXX XX%

model business provides by wrap demonstrate the market perform results will As different saying how I stability quarter I to Nasdaq’s us second in diversified up, environments. our culture client-centric well summarize that and

As evolution. with continue XXXX, within three the that major second broadening our opportunities of on we strategic enter half we to align focus areas

our infrastructure cloud First, technology the cloud-enabled includes clients in liquidity, in we quarter including efforts are world this of as fourth own technologies a modernization offerings. leader migrate the the making our of migration a the powerful markets of to of to market enable pillar This to marketplaces are as progress maximize of other MRX our market planned we technology. well we through class as and under more the within Options their our year state, our

leading pillar the a on ESG our and substantial are incredibly that believe Second, we to execute to well under solutions provider. opportunity positioned unique we of be transparency,

of pillar safe well-positioned through progress fair savers our on we We offerings of first brokerage by Nasdaq half and over crime and diverse uncertainties role specific our important our SaaS-based the to of an macroeconomic of the and as communicate review forward that, and play their to a and to ESG community. powerful to entire of with believe combined reporting network to is navigate the providing to ability remain latter advancing And and corporate centered facilitate call and our persist move integrity, investment the for make are Ann we serving with aggregation capabilities We services clients. strategies and year. turn clients system and third, into more that the I along data And strategy in anti-financial this to climate advisory will geopolitical seeking their financial relentlessly now details. investors financial foundation bank with may needs that we on the focused under the

Ann Dennison

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

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

organic Slide to with year on from Starting with earlier, by SaaS $XX was totaled Investment saw increased improvement. ARR $XX period. an segment $XXX to sequential while ARR period compared increase the to to technology data. due annualized contribution increase of of year in in period the review of X% of revenue million, revenue prior will write-down Market infrastructure or positive XX million, growth growth XX%. revenue Market from now margin a the on Technology XX%. results Market mentioned period. increase The was XX% million year businesses for $XX market the growth period. totaled X% segment Verafin reflects through Adena XX. prior or primarily totaled XX% the market as the the anti-financial impact as for though X%, $XXX increase period. revenues XX, growth or deferred prior and Intelligence quarterly the totaled strong the of year increased index operating Organic business, I million during compared billion, $XXX Market driven Technology, Technology and prior analytics of of Slides was $XX well an Turning Organic crime in $X.XX segment XX% ARR increase revenue an as our the period, reflecting the Technology million million, million in X% an revenue the

year step products, in to period. that higher a increased to higher offerings. the operating in derived happened the typically from licensed percentage revenue well U.S. organic as about ESG revenues threshold triggers The which the benefit Our from a approximate the XX% the licensing licensing Intelligence in the prior higher points higher listings due year Investment percentage XX% million year, volumes Relations the up was where the up index index the The in the revenues Investor adoption licensing lower earlier both prior revenues index side X the or percentage of segment of from level of XXXX. two-thirds Platforms we breadth growth. AUM-based well than primarily point X on the were compared during products revenues Nasdaq economics, was margin driven XX% about. we of and speak increase revenues principally increased as futures as $XX in as did by derivative we saw period, Corporate and advisory including reporting trading than Based month strength hitting across of XX%,

segment or management subdued net revenues. reflects margin year segment growth due cash issuer combination base points environment. in Platforms was operating the impact $X revenue Corporate period. listed of issuer in XX% period, rates. The The $XXX in and million increase to operating prior X% the organic XX% and base by negative was increased The a the and growth changes driven The the derivatives Services excluding XX% IPO lower of to Market X increased from equity corporate increase SPAC. and organic to year from year listed unchanged or X%. the Our percentage period. X%, there equity $X compared of revenues compared prior trade was recent Corporate prior margin increased million or marketing was million services, million ARR expense increased XX% Platforms FX $XX

higher impact FX expense and organic rates million to Turning increase increased and is $XX organic to review net increase in decrease of and by $XXX million XX divestitures. acquisitions primarily $XX impact a partially expense, changes reflects non-GAAP million. expenses driven both to Page offset decrease $XX of two million reflecting The and guidance, by operating expenses $X million from the benefits the compensation a The increase a factors. from

employees X% new over past a First the is XX the in continued investment in team drive including to our growth, increase months.

annual quarterly at than expense prior higher run-rate have years which the is merit merit quarter. to higher inflationary of starting compensation beginning guidance is reflected increase due pressures the we increases, year. Second The the was increase on the in our into in second the and built

retain this to We in make the significant top investments industry. continue tightened labor market attract in talent and our to

performance non-GAAP our the and billion both FX to narrowing the the bottom of XXXX investments, $X.XX and to XXXX. rates guidance current tightening are of account expectations continued billion, far for strong We $X.XX thus prior in continued top range operating expense to

repayment XX, a XQ million a versus by partially commercial and notes ‘XX, $XXX book million senior a by by our due of the caused $XXX to the repayment X.XX% weaker decrease $XXX $XXX million of to issuance offset Turning XXXX, due of million in primarily decreased Slide net of million June debt values unsecured euro. – paper of Eurobond’s $XXX

first the quarter Our down trailing ended of X.Xx months period XXXX. the EBITDA to XX ratio non-GAAP total in from debt X.Xx, at

repurchases approval to split our to update the a on Let stock. dividend, me and moment Board stock you our take now

repurchased in $XX dividends $XXX stock shares the in and aggregate common During the paid the company quarter second million. million of XXXX, of

We XXXX. in completed dilution divestiture of share have the our offset business of repurchase the U.S. program income to successfully to related June fixed

XX, $XXX announce split there share repurchase million program. stock in and our the was I also am X-for-X under declared Board approved As June XXXX, of stock remaining that to of pleased Board authorized the a dividend. a form

and had the to stock increase stock As to permit of of approval the previously SEC the authorized an required the month shareholders. of We of shares XX, The our will last on received charter split-adjusted of August stock approval both our to to us date dividend we a distribution XX. with be effect begin amendment the number yesterday. a and the common charter date dividend expect approvals XX, and filed amendment for disclosed, August the August both record basis we on to trading

of XX to very on progress Page the made I’d to on touch Turning our strategy. presentation, of like we’ve executing the some material sustainability

in terms of impact. external First,

framework-based As acquisition approach in of which existing serving the complement closed announced Adena solution the on mentioned, Metrio June, our we our solution. more OneReport expanding and set, corporate ESG will

Second, had our party and the science-based emissions in XXXX third in we published Science-based GHG advancing validation. our verified by to reports official annual have a our On terms submitted Targets targets climate corporate of strategy, our sustainability TCFD we and sustainability, June. for Initiative

in of sustainability particular. standards rating the leading received in recognizing to overall July, MSCI our strength we including profile our Lastly, ESG our of upgrade two-level a AA, governance

see across the advance program our across the Nasdaq’s operating record forward. company’s we reflect growth to quarter the strong a what range margin, We our and revenues, build as results time, environments. opportunities XXXX of We progress updating In regularly. well you segment XX% in for non-GAAP far to Q&A. continue that second your in a to it moving consistently continuation closing, Solutions of over on operator for revenue perform Thank I’ll thus and back multiple turn wide aspects see XX% upon and ability forward look quarterly delivered resulting momentum to sustainability we can operating in you organic the to

Operator

Rich Thank Repetto you. [Operator Instructions] from Our Sandler. first comes Piper question with

is open. line Your

Rich Repetto

over Adena question digest Chair that you sure a month made morning, And I of about is, just equity on Adena, Yes. to regulation. Good sort he I’m market ago. good Gansler’s first morning, Ann. had guess chance a comments and structure

as be by least modest more was back bringing a So But because stood was I areas venues, volume think, out that what you just if that exchanges, out, there unintended thought just for you – different at and guess, focus five rebates. or anyway. see on. to positive put large six critical particular intention I because or particular it consequences trying of at but exchange he that’s to might to anything you And noteworthy you you want that look in I’m as to – could

Adena Friedman

I of it’s yet a to to that disclosure perspective And say focused Rich, a all field from and from sure. structure solid does And would markets. between true really on that exchanges great and haven’t seeing, the actually understanding execution, on in quality, demand leveling go long listening playing discussions focused and the and at the how proposals market Yes, a seen have pools. transparency on lit the think Best with all, terms market bring understanding formal of that we’re and venues more the he Chair orders to strengthening in we pleased that in I and that really in to really first proposals. But first way of he’s competitive because regard that’s he’s He’s and focused of around you. offer to as times. because, value we recognize we’re execution foremost, focusing also the exchanges best really really and on into National transparency supply lit dark competition we’re, investors so Gensler of hear Bid have where focused,

to So he’s beneficial we to see what is trying think achieve, overall, investors. we

the all comments see National lit value orders. then those process generally put exchanges of their the then, long industry But on that quotes on a a structure available the proposals a offer, we I designed the like. incentivizes make that into so part to have and go the focused we in will literally rebate the the Bid And really that is on, course, still to understand think quotes around look proposal venue structure great speaking, in determine what starts we of to I because it a we support would be. the Best and at as final look to really of lit incentive structures to – what he’s quotes some obviously, national engagements that participants way think have lit incentive long as

So the it’s a the encouraged focused lot just he’s beginning, are of but we that areas by on.

Rich Repetto

But it. don’t this at looking And I Got guess or not. follow-up whether a I know necessary as just qualifies your expense guidance.

You still narrowed second expenses the it X% but more a bit. half half. would first than be up

quarter any So your anything color behind the and this pretty the color or it? just out. control more increase why expense was X% half stand back in

Ann Dennison

Sure, Rich.

about segment just our to Solutions to X% a think X% to revenues inflationary to then against to of for return revenue and of an align we about growth, expenses about the as we our X% And is additional So expense that, medium-term built growth. sort context well of etcetera. as Coming in we we our the into think back did reflect how travel, into X% office outlook the factors we year, guidance and cost talked – X%.

There all variability throughout the way built in the And things some so that’s the into guidance. come that in year. is

accruals. at the variability of look down is FX, you when and just the of second timing things, a so taking there quarter, And that couple and

past XQ, the expense in in And be And like back range. so top we midpoint or as towards in just expect end year, expenses. the where higher either to some half look at years, guidance we’d we’d and of in depending of have our performance, seasonality even in the the to that XQ to we expect increase an forward on come

Adena Friedman

we’ve also the Yes. important it’s our growth just that eight segment. double-digit to in consecutive Solutions last quarters, note think in really And I had

that that we sure we’ve experienced, we thought in from to the not team in to hoping that in they be us servicing to that investments all overall and those So then, the growth, really drive right the growth makes to these segments, medium-term the new but we’re of achieve. personnel the we’ve having are have continue outlook that now course, of businesses only that the right to been also have make support which to clients exceeding able continue growth been make terms providing

So reflected guidance so of we’ve shown addition the the and obviously, is all that in to, performance far. in

Rich Repetto

Got it. Thank That’s great color. you.

Adena Friedman

Sure.

Operator

comes Our with next Alex from UBS. Kramm question

line Your open. is

Alex Kramm

Hi, Yes. good morning, everyone.

in lot may perhaps the of technology I I segment numbers have think there, into that, segment second, But you a softer legacy help than what’s particular little I a that missed Verafin going you going the in and was some. isolating basis a on and how for the us standalone maybe us crime maybe through a can But Just help crime financial ran in did bit thought. the financial on businesses. growth

numbers So what’s be in the those happening any and helpful? businesses color around would Thanks.

Adena Friedman

Thanks, Sure. Yes. Alex.

is healthy One engagement color surveillance around to healthy and so is AML the is is But if I So continue some to anti-fin we our the growth anti-fin on other of – do market provide with technology. Fraud the And trade which sub-segment, components, both Verafin two business them clients. crime two today. the numbers the And, now on have detection business, that there and and components give which the the basis and investigation is that surveillance of crime. business.

I think in growth business, the it Verafin outsized that But XX-month as we that not is over Tech, that noting second so at just we quarter. of quarter. with a truly look year, at we last by a look probably also quarter much had like quarter do worth period, it Market

in at that looking – trying in so of the the context QX. quarter current the we’re very we’re of context And last that outsized quarter

strong are we general, growth you as across seeing think I in continued Verafin. mentioned,

of we’ve where of banks really along Tier expect those investors X with also lines perform year seeing market. And We try Verafin. continue are to engagement deliver to we the been bought Verafin our – all up since the discussing good throughout to services the we with what to we

the Tier I with obviously one that. And think is mean banks we solutions. that thing our know about that Tier I those are Xs the with surveillance X cycles we long. serve sales

we’re And we really to banks, market we time. surveillance banks, the take banks. surveillance that and that contracts. have can of trading performance with our process But and client business. bit around we quarter-over-quarter – Tier really great regard banks, rate have continuing a to variability terms engagement also – in midsized that the trade renewing more crypto And signed expanding contracting really the business, more in engaging can the have now growth – now first of the fin-techs we’re in With We around. more module trade there. surveillance strong contracts, little through the smaller the to see X getting Just we terms create SME a continues and invest

think market always – bit business, a And quarter has slower part of there, growth I a had, experience. year-over-year that would smaller surveillance kind business of will I at always more set. the say, been, we a of be it quarter a is of little client and flat

all And I momentum we So the to we saw. I think in think great – Alex, see that you up, to continue business. what of adds that but

Alex Kramm

but were I to there think just quarters. the a on for analytics color. last three there, Thank you I’m wrong And that. Very the in lot business, Analytics I over quick didn’t this. be nitpicky FX the too of dollar one, here, think revenues literally not flat the was a then about good business, but maybe

it’s anything just be should FX? I just of or in that So that’s aware environment this happening maybe

Adena Friedman

It’s of combination no. a it’s – Yes, well, things.

Obviously, thing it. I growth. going give I’m it is to try Ann to think hand But some have good to answer. expand to sales sign clients complete a and investment to of going sequentially. are continues of what in going and every you are and there quarters continue others answer the grow shows are first They up than that be I sure incrementally just new some terms contracts. to to make I’m stronger they of to quarter that And So continue our doing. expansions to

the dynamics there in secondary the though, one Was is and with just first associated think, fourth up a have funds, quarter. around got that couple what some that something in And running I quarter. that surface you’ve I showed FX transactions for was it the revenue of then equity we think now under private else or... programs

Ann Dennison

It’s not FX.

a that We couple rounding. over tipped items non-recurring other small have the of

it. little solutions noise a are is growing business, expected. But there as the bit of the owner analytics the core asset of So behind

Alex Kramm

flush can you later. Thank much. it we very Okay, out

Adena Friedman

Yes, great. Thanks, Alex.

Operator

Bank. question with next Bedell Brian from Our Deutsche comes

is open. Your line

Brian Bedell

I’ll Great. for they question. are taking related. my Thanks questions one, bundle into much two very

segment this growth. question tracking on organic Adena, you’ve been well. know growth. that X% again obviously, to this you quarter I of as ahead get a X% Solutions a little And lot. the

you’re the infrastructure of continuing that exceed is guess maybe So that my your some level X, and that just But is longer. growth cycle trading but you’re organic not new opportunities now, that bank X% X talk for that cross-sell, your venues thinking are in then infrastructure organic with norm? in Tier talking to starting you’re stronger the right X%, of And to in optimism changing outside a for of initiatives market just realizing, given growth – course, maybe obviously, about about rate.

drive related would into simply index the rate is that what you follow-up on then licensing. So that a I And have? of the what X% down Rate to guess, Solutions organic – lot opportunities X% given growth

threshold Just thinking you XQ, what about run that the guess, actually you’ve be hit into I given might quarter? Thanks. second threshold. when did rate in the the reached

Adena Friedman

Sure.

Okay.

it’s Go going ahead, So just probably the to question second Ann. answer I think shorter first we’re because a answer.

Ann Dennison

Brian. Sure,

So April. we late the in index on threshold hit question, the

can the And threshold so about affecting of the X X you out the quarter. of think months

Adena Friedman

Yes.

the the in a it’s basis But on I mean, going think markets. obviously, I volumes run forward, so futures to that... And rate subject

Ann Dennison

the held little into better look Yes. a the they third revenue. better particular All of third will look fourth – else going quarter. It part that equal, than

Adena Friedman

you the other growth, that mission-critical think first provide with regarding pleased and is In say to and corporates, I that are to have banks solutions organic thing and really we firms. and the we asked terms I exchanges, would we analytics do management question the software the to bigger brokers – of of performance to business, investment

ESG and with particularly feel is volatility. are really being solutions So successfully an – growth portfolio owner really growth of are engage to analytics, value, really obviously, important asset able as And allocation do to for manage add periods understand these with investors. investment corporates It’s how how for that investors a that. their do super we asset decisions to our changing our our With important. is really long-term important, trend

obviously, our trend services market more operators, technology Anti-fin that long-term are for got providing really And technology And crime, huge drives mission-critical in so advanced then sticky. there. those you’ve business.

So we feel clients. of very products good stickiness our the about as delivering to we’re them

in terms all a been terms – to that And about to things technology of the delivering really across I accruing segments. We is rate. investing have also there solutions think of modern solutions our go. in growth of we as we franchise their of benefit are in But and think couple and terms the of more improved

of the growth their is off forward, that in think about we as them more that sure they strong growth something our customers paying we’re make environment I business still companies in have secure flip more Based slows ESG X% as IPO into we for listings listed we to have going IPO roll today, rate packages, had we XXXX, the could IR year our have companies. really listings X But X% our side ago. be that, that now than because services. that that business. today seeing we’d think we And as and we on like

of everyone conversations together, new innovative back more markets to the the identify into markets. want really feel well with So continue that I quarter. really really kind that, to the also, bring on that new on markets are side, some beyond technology are grow their think gives And in marketplaces. I signed the there. back focused focused they of or we’ve us to their engaging right concrete. we clients able kind going to we’re getting of ability of on are They future then latest theoretical to of They And you’re Infrastructure like that today. and some interesting we’re on do market from Brian, Technology with the Market this that, how the and And form,

feel like we’re this do going we the So that has and second year half a lot into as momentum XXXX. of of into

Brian Bedell

Okay.

headwinds sounds really, segment. So on But – remain strong potentially. growth Solutions it optimistic growth you this in really organic some like

Adena Friedman

I an we’re to really that remain – do would great we external mean, I’m value I say, really optimistic I but – we the are optimist, clients. delivering

to that. like continue And so we’d

I always dynamics we are consider. just think different know we that have there to

our performing so have overall And we’re outlook therefore, medium-term to maintaining But been than obviously, better the X% we to X%. that.

Brian Bedell

you much. enough. fair Thank Yes, so

Adena Friedman

Thanks.

Operator

Sachs. Thank you. next Goldman Instructions] from with come will Blostein [Operator Alexander Our question

Your line is open.

Alexander Blostein

everybody. morning, good Hello. Hi,

Adena Friedman

Alex. Hey,

Ann Dennison

Alex. Hi,

Alexander Blostein

question. good my Thanks for Hi, morning. taking

around one structure market you another for So regulation. the

on relative given where around the I respect to prior feels market SEC with around to Commission With narrow was Gensler’s the guess, kind trying guess, how it Chair follow-up here Richard’s Just albeit in bit which to this of that what in to forward it question, proposal. more existing administration’s proposal it’s I feels the, still data, expecting a to background, current are proposals? go you the achieve, is like fits not but that from clear like

Adena Friedman

the the terms thing overseeing Well, sure. the exchanges in in Well, consolidated SIP and court should with understanding value decision the pleased of I is think the of we critical we first note were the tape. overseeing plans

core SEC we And governance the really So, changes. a the that recognize part you to last over [ph] of said, want rule our infrastructure last are as the we with But clients. the the that. that consolidated of means proposal I of data, meet we is which also remains – with think pleased needs

and a lots take multiple that like like over of to terms is settled. that Alex, But kind move then phase-in in And as it I are as that – to of slowly start lots approved are there that the that governance as will was well of there of think forward they that it’s a years. lot SIP components data odd the were now as rule going of elements think I time multiple to by are some because So, SEC. well there the multiple consolidators, is

So, that, look fully the with are to at but we much I don’t how necessarily want we also the understand we out engaging figure plans think really pricing. impact of to very

for our We with be now an opportunity us. consolidator them have the multiple as consider. And a role are considering to right could also SEC model a proposal for the we consolidator that pricing because and

it’s years. start how next to And going so a several that think that structure move to I the we be governance that will see train, forward slow-moving so – set, have I goes just is over think is we and to going though, because to now, it the

Alexander Blostein

Got Thanks very it. much. Great.

Adena Friedman

Sure.

Operator

Jefferies. Daniel have We from a question Fannon with

Your line is open.

Daniel Fannon

you of change wanted that And then market kind the we higher. normal talking And and other on dialogue terms and the Thanks. in or normalization things about Good quarter the lows there you market consistently I seen moved based of morning. the kind the of some to of you XXXX? within can about thinking seasonality have of that the move in clients, we as legacy around has been assume on have should business of tech with margin context, with ask I there margins fourth lot. you follow-up see think – wanted tech. whether to some a orders see about

Adena Friedman

Sure.

starting right. that a market now are in I in that, normal we think mode tech, Daniel to operate I would say

engaging So, we with are person. clients in

in with cases. client clients some co-locating are We

capabilities place We are delivery in are clients servicing good well. our terms we in a and of our

all great. think And that’s so I

are standardized delivering in have clients of in very clients how are business, of on-prem think scalability can of are that way the the of a products a of – as I signing our we terms terms – those. still specialized the lot but are over more SaaS-based are very most and opposed do more clients helpful of also they we long-term. support that terms with which them in But which new to are signing solutions both I is the in contracts, in we specialized, think buying, scalable we of still terms

you And a think see as So, do in true at the that, margins. variability it’s I more It’s some hybrid. a moment. mix result of a real

signing and format, deliveries, You move but to more getting back more about specialized, less and new forward kind by is, request forward, of are we though change I would of in one are sticky. and see we it’s in have really but as of clients mode to a more revenues going the a of revenues, change sales. stable terms the The normalized terms in encouraged we going change we SaaS sales, orientation very lower say are standardized, request more SaaS new availability in because in request of thing terms quarter-over-quarter

an more sticky we longer to And of term, SaaS. stable and to bit revenue think immediate say there, that of coming change see I so are from moderate a for the don’t in would kind expect would but favor just going I we

Daniel Fannon

Thank you.

Adena Friedman

Sure.

Operator

America. Bank with Our next of Craig Siegenthaler from comes question

open. line Your is

Craig Siegenthaler

Good morning Adena.

Adena Friedman

Good morning.

Craig Siegenthaler

And pricing? So, high of trades my quarter. pricing question market has is competitor for the the major on share cash auctions Wondering if opening, in the also trades. to these has past closing Nasdaq ability raise A Nasdaq equities. this increased

Adena Friedman

think very I have we Well, for long that in we time. have had pricing a been – our stable auctions

that were think I couple our in did ago years that changes competitors space. of some there a

paid and closing been quality And have auctions. a very very, we and We in very value. stable I for get. provide clients I that think We high we think that our there the opening they are continue appreciate very, think to we value execution the think

the those are we quarterly steady excited it therefore, and But think because We a that’s we looking Those provide as make a now. really I that. But have happened – feel events. that’s we And really the see infrastructure right execute Obviously, are are because to those us. you a for we our was the that Russell, great to happen. our that. moments. kind big at events how about we a big go witches, you invest we event, that appropriately other we we moments the rebalances. with are do we what are of to Those service, paid for – great have for rewarded about So, then fact quad as a and – surge invest that lot a ability of are that like in in support are more that’s feel that those and – lot we

Craig Siegenthaler

you. Thank

Operator

comes next Kyle Our with KBW. from question Voigt

Your line open. is

Kyle Voigt

morning. Hey. my taking question. for Thanks Good

us M&A. bit where a and environment. assuming you to you basis an attractive X.Xx to regarding about find you acquisition M&A de-levered remind leverage feel if to just you could debt mix on a bit then net Can the current you wondering quite business opportunity? the Just net And a speak have EBITDA. given comfortable taking

and a few environment looking the as secular of of valuations at medium-term have growth have public has past bit years, rates rates Have ago? come today I see to the for in growth in a you Nasdaq very you of as or year a markets we markets the versus that terms assets where attractive profile the guess seen we Over maybe in looking improving and at whole. growth been some in started at were growth based kind the the the assets. of are private higher bid-ask in spread narrowed we quite

Adena Friedman

Sure. of… I the mean in Ann, first the of question part do you answer terms to want

Ann Dennison

dependencies we the of ratios. we M&A de-lever. there, in lot Yes. question how of is could There terms the opportunity, would sort the Kyle, of around a is where I leverage quickly what take answer will

a the deal, point of where back is basis. on did and Verafin maybe to think X.X X.X best took And now. I the we down then we to at we are what leverage reference gross the up

in be agencies We don’t that, our way. – set that rule. it have very hard about – would a deleveraging be obviously, we plan with there is rating and And think the on would could our whatever with you so. like so no It’s And based. working circumstance on association

Adena Friedman

And rating. is our grade one do do Yes. like investment think that mean say I we thing we I the

we we as in deals. at And are grade with investment our rating financing would agencies making that understand, looking we the factor sure deals and to and looking rating work so at

how So, it. at we generally that’s look

And the value terms for it over time I true definitely they receptivity also time. into are In it right and might quickly Like M&A, changing to – or to is think now. environment, private cap way it different factors think to environment. companies be to I be M&A going time their environment, in takes cap market in market a term is recognize what going for are quickly, the what just this definitely recover both – changing public old market of they their very that understand is able the a markets. to longer market or to that environment markets cap and into that their a grow to companies takes their feel very the they think understanding

are private dramatic. public sell We so have that’s point CEO. reductions And that’s the quite It’s kind that one seeing thing as at. with in quite but that much, their that’s as time they not the maybe reference definitely a – that valuations, thing markets, think generally markets to company in but value another line or speaking, in not in the again, should to a for of

our strategy environment. like we sustain things it’s But want of other So, organic business. are at as we the I how our is Kyle, ways to we I medium to evaluating majority us focused inside do forward. is think, But always continue opportunistic drive out and Metrio dynamic vast our we still really to growth. think to Nasdaq, is I small a are on for us continue bolt-ons continue organic of that our very looking small mean growth deals we that grow to with focus also like to M&A, might

Kyle Voigt

Very helpful. you. Thank

Adena Friedman

Sure.

Operator

from Cyprys with comes our Michael And question next you. Morgan Stanley. Thank

line is Your open.

Michael Cyprys

morning. Good Hi.

And do us offerings in the stack you given you be how side, revenues in or at on side, done. would able meaningful as services you when And with think ESG? relative contributes that which much to you acquisitions that have Nasdaq? to on ESG the respect does the Just on the marketplace that a that about today offerings think you product in you. question revenue to the some you would to was hoping growth you where how of on at remind ESG. be Thank like I be ESG, most you that ESG have to up the that look have might

Adena Friedman

Sure.

rates is – revenues. seeing ESG now. disclose business to growth the of corporate ESG and our in separately IR definitely if I revenues services growth from higher right drive But highest helping we think I the So, is rest we it that our that are the would the don’t we of and it part say

track as that. And or last have definitely thoughts hope ‘XX. Day at to out what feel that with revenues some at given we Investor in achieve XXXX are on least the and terms we now we As we to of between

and there. And continue we invest so – to

we this several of and year, quite we to reporting. components excited to how that can But color about of there that it. to able bit as is get that little so right But the advisory it. it’s you give the kind are business moving that’s hopefully Day business the now, And the content we be we a much actually a continue and more us, point so our are part corporate highest more into around demand – will I you within business. understand for Investor help becoming would of space, out more, into there But and are

us. more investors. investors help contracts programs reporting OneReport around it. communicate really driver manage programs, are the annual think ago, is programs. companies agencies. to But the like have more out very very that on-boarding the talk now the growing And very, about provide companies business lot about like Definitely, in business, corporates them it’s their of that’s removal. we and the be of there. We marketplace is to with Increasingly, And for clients saying, that their going appropriately say to saying, our then days. do we as X really have getting and it’s say So, to opportunities rating a to XX-year how in we and revenue the We And we data for SMG with small, they more called output them mature even though Puro. and removal plan onto to are because successful them. it carbon true terms that XX-year with suppliers seeing at what of help their that high-quality It programs sustain other early first, – as mature a maturing that tools a more million kind a platform $X and now communicating more companies I But we were be small. were It’s going into in carbon build see getting them of with carbon them though, help kind quickly today, Metrio would and just X-year, really growth out it’s data that terms very long-term collecting part – the their is do and I don’t markets within really the small. marketplace really years those those programs, of it’s offset European to

And will also a for we Day. Investor relatively will small, be today, so are areas, long-term to you be these give – us. will exciting But that able content we but growing at and give more growth and driver

Michael Cyprys

Thank Alright. you.

Adena Friedman

Sure.

Operator

with Gautam Suisse. Our next Sawant question Credit from comes

Your line is open.

Gautam Sawant

the could affect affected you for Hey. SaaS within revenues outlook how consolidation specifically Good the on by of be investment potential could your you provide question. intelligence? growth XXXX, our recurring industry Thank and morning. Can taking for recession

Adena Friedman

changes and seen our say of market what business. have in the some sales solutions material our our SaaS-oriented we analytics, across anti-financial I our that guidance would I so tech ESG obviously IR newer businesses, far any SaaS of any Sure. businesses, and that and our seen But includes crime investment specific provide is mean not that our in buying have we don’t businesses. in we general the in – think behaviors services, I

because I markets. capital in that are the that the XXXX, the to would It our services environment if provide predict are hard sticky technology fact think that and don’t that have economic into environment. in cases, we we and think as right navigate changes I products still in now, very there. go through In to so to environment are any that behaviors of navigating markets see of into but at we every sustained the that such clients look And sort But are we they a that’s to capital following. a go they really is some were significant important we recessionary

they And do are so sticky. very we think

that important buying I buying have longer. recessionary products, think as decisions terms about, on will some have We those will high changes talked environment, in take retention protracted you status, have of some could obviously that companies, some the edges, sticky we M&A some effect could products, in very very a retention. decisions and talking on and But very, some again, their corporate have in very products. are of

over generally, recessionary asset if periods, prior banks see actually the financial of M&A a a M&A, matter. we among lot look of though, back you managers don’t In industry, terms in as among and general

On have that we the talking but X,XXX services. are managers X,XXX have we banks use – and yes, edges, we asset our

a of And based clients not also, way, services. that material by support. calculus of I part our use of to So, it’s just our corporate companies on just we terms services going depth be the the IR the think and and the breadth it’s in ESG XX,XXX

be So, we we are just if will scale changes you But of huge to we – there. by updates provide who the certainly we going is are, a seeing the M&A factor. not

Gautam Sawant

has question the compensation, a technology follow-up bit? expense you help like of that worker Got do talent decelerate And change? the can the in just a there think it. as on some demand space or And

Adena Friedman

Yes.

think to good environment. things been we managing Certainly, right that our compensation been feel talent. retain we make sure it’s have I attract this I interesting. that how the doing very we’ve and great And in about competitive

people started come We to to frankly. the Nasdaq, six last eight weeks, to would really to say, have, see more weeks I in wanting

working the really people the more of hard back, company think technology understanding coming hit of industry we We parts in strong strong some that financial are the are a a and I company who some benefits of the like are employees have And Nasdaq. place a are profile. that in left

much know I I Gautam, about great to that our talent comp, that feel might would say but how so ability yet, don’t we impact good And here. attract

Gautam Sawant

Thank you for taking my questions.

Adena Friedman

Sure.

Operator

next Owen comes from with Our question Lau Oppenheimer.

is open. line Your

Owen Lau

first more taking completed and my the think morning mentioned Could year. so for that you does to migrate us migration will Adena, your migration I on learned process? you your in into this process question. thank what give And other And the please far in you Could how Thank color be you. Good you about impact please the fourth you quarter in future? this have cloud. talk the systems

Adena Friedman

Yes. Owen. Hey Sure.

the making about excited quite we AWS. actually are with are progress we So,

So, our center in But environment. a recognize, the okay, just New so data data in if to remind last within the everyone, to systems what years, center, Jersey, AWS cloud surrounding moving is committed primary support into is to create local all we environment. focused just really take private which Carteret cloud markets our zone a we one step been back, our we call XX of over have on public

the systems But of engine we to market deployment. our itself, systems So, that on-premise the trading have operation some trading. themselves, the systems and always been support matching client-facing has

So, AWS is center. data our into coming

moving the AWS market Outpost We into options infrastructure. our first are

that fourth in Our plan the is to quarter. do

build with helping track we really making center, of we context We power the learning been data the center. the in are the is out data on sure into we optimizing us What have while bringing for are that. infrastructure AWS

the be really and are Equinix, data center working also connection with to going we expanding that, X the will who partner that our our extend over power. next in is on years, that’s So,

running, and just getting of As infrastructure in AWS of the connection power post we in to sure clients. that them we managing out our in the power are needs are work of up all iterations making the putting with with, of we and obviously, first

really we thing at time, through. that it’s very comfortable But are And that’s now. the are so to learn are the interesting we we moving that finding same one

moved have We MRX onto Fusion.

We our have with that the the on-prem tested testing with environment clients fall in in make therefore, sure the environment delivering we to we as that to performance. – the and start and now clients baseline same are in new an get a our

been learning underway and it. well and about great are we it’s are and we partnership, lot So, a a feel we very good

Owen Lau

you Thank much. very it. Got

Adena Friedman

Sure.

Operator

back I Adena we the like to Thank you. call time over And closing remarks. that’s all turn have for questions. the for to would Friedman

Adena Friedman

for very spending with you much so really, much, us. it’s Well, you thank thank and time

we the of on continue to We you will continue Thank proud update have you. much. as heard, and our we excited to to be very you and progress continue update and results delivered, we will we

Operator

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

disconnect. may You now

Nasdaq (NDAQ) 20 Jul 222022 Q2 Earnings call transcript