NDAQ - Earnings call transcript Q3 2024

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Operator

Good day, and thank you for standing by. Welcome to Nasdaq Third Quarter 2024 Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the call over to your first speaker to Ato Garrett, Senior Vice President, Investor Relations at Nasdaq. Please go ahead.

Ato Garrett

thank Quarter joining XXXX and discuss today everyone, Third Nasdaq's Financial morning, you us for to Good Results.

found and our On our the remarks, this The website. Financial we Youngwood, for the After presentation accompanying press Chair Friedman, Relations of be Officer; Chief Q&A. and Chief will call management line Executive on Officer; prepared are team. Investor other members Adena release our line earnings the open Sarah can and

that risks we description this release you be in would making risks. Form on remind I more in like press statements will call on report A XX-K. forward-looking to complete our annual a and summary is involve our that of these contained

announced and Calypso rates AxiomSL AxiomSL We we third except owned all excluded year-over-year in adjustment excluded on on-prem if XXXX, of will revenue revenue recognized our onetime financial growth contracts an performance and and organic AxiomSL discuss for impact as the ratably in not and financial the which basis. periods, Calypso, using the comparable recognized yet XXXX are calculated pro also and all of previously quarter for for results forma FX,

the of U.S. our FX release Investor Relations can section impact growth acquisitions. at Reconciliations as and in of well as organic to found in References in located GAAP Financials the exclude results non-GAAP press to of be our a ir.nasdaq.com. filing website

over Adena. call turn will I the to now

Adena Friedman

morning, good and Ato, you joining you, Thank Thank for us. everyone.

through environment. economy the detail. Beginning the September I financial some the recent months data. labor our continues hand overall central more cut call over economic months. The to coupled with against discuss has quarterly review and a lowering our helped stabilize have X U.S. I'll pivoted then major European the to progress to supported has rates solid to in the the with On combat Sarah results growth. environment, to call services market priorities. year, Fed's strategic performance rates morning, by perspective Bank rate several this macroeconomic in labor banks walk slowing over on European external Internationally, recent the cut provide the Central Notably, and the times this our show and will which, past strength, more

IPO for the quarters. environment Looking across macro and landing ahead, fluid, trending toward to U.S. outlook expected while we activity this rebound currently as durable potential markets could and well range The consistent as environment constructive global outcomes, as our our economic which mission-critical positive economic of remains our to sustainable the positioned with Nasdaq lead in trading remains backdrop, current trends technologies. to cuts potential And the provide Against sustained additional financial for is coming soft deliver well see dynamic across in diversified operate a in environment, a a global platforms. rate continue demand growth a the in institutions a XXXX.

billion. quarter XX% of both our achievement, synergy X% offset Now financial partially and increased to while solutions recurring consecutive growth. net our our marking growth We turn revenue, or a revenues the year-over-year margin double-digit with in Expenses to to strong XX%. grew ARR, quarter let me investment in in fourth business, $X.X annualized reflecting delivered solutions quarter, by X% revenue, operating the increased Total results.

quarter. generation on us continue has has net enabled progress Calypso, our and to in cash the integration allowed flow strong in and target successful over expense action which We continue XX% to our ratio of free us delever, leverage to resulting a to AxiomSL of make X.Xx synergies the

to with data delivered see Capital strong quarter modest business fueled performance. and X% in we index by Access The Platforms. of our with growth to another revenue, continue offset now growth, listings by ARR modest contributing a operating Turning growth Beginning X% division highlights, listings starting operating decline and data revenue quarter, through revenue September and year delisting. company of to XX% win We In listings. experienced we Nasdaq-eligible welcomed to prior in a year-to-date the XX lower activity uptick companies, activity in rate in due a listings, listings the U.S.

the Additionally, listed Lineage. to have XX year's largest IPOs X the top we of the the largest X listing year, quarters of in date, first including

market manufacturer, as venue We XXXth in also from our Campbell's, to competitor, listings technology $X celebrated a primary government trillion recorded year we as for representing we've our Nasdaq's role including listing prominent attracted alone, reinforcing U.S. contractor, Nasdaq premier and the XX legendary switch of major food listing value. approximately This cumulatively switches, milestone SAIC, the

Nasdaq we resumes in has flywheel IPO environment, previously including international benefited suite Corporate positioned activity strength cycles, analytics enhancements strength moderate by enterprise AI Insights, and is sales, demand continued sales by higher our ensure remain growth data, on from the market not markets. Corporate operating license client We as of product when materially to focused with and retention solutions. in announced new of the In drove introduction heightened well broader Solutions, In and Workflow across offset we new changed. features Solutions. evidenced the Across from

Within analytics, and and and communities. manager demand we've our seen workflow owner with for asset solutions the activity increased data asset

our continue and launched asset insights managers manager tools Asset peer research as unique and owners new recently such seek more benchmarking to are through data solution, services. using while the products

the new innovation and exceptional product while This the continue launches delivered including inflows billion to trailing $XXX of net finally, And quarter. this Index period, the billion the another in broad our XX-month $XX quarter, franchise resulting in AUM with XX of strength we drive quarter billion in index expansion growth in average $XX third of our quarter. with reflects business in

X ARR XX% AxiomSL Financial and and and upsells the Technology. Management signed Technology, across Trade was new clients, we services. XX%, Financial combined to next Technology cross-sells. XX% in solutions XX% combined Turning Management including in Market and in XX Calypso XXX Overall, the division Crime

#X and financial industry. Research's as recognition strong services across leadership managed a Chartis provider on rankings, subdivisions. Crime that representing crime to the proud Financial Moving specific industry financial technology management our for crime We're Management of debuted the

adoption standpoint, in seen in We medium a we've client hands entity rollout, new XXX year-to-date. for GenAI research copilot strong SMB operational or now medium signed bank integrated institutions. clients the U.S. an of XX total From X,XXX new clients of small, is bank over which to our small

continue robust the We SMB of opportunities a sales in larger to clients emphasis on maintain a targeting pipeline particular segment. with

X wire announced. During client signed we international the previously solution Tier our fraud quarter, as to also

push have in pipeline a solid our We continue are to for clients this making and Tier and growing cohort. progress X on Tier X key

by AxiomSL and markets environments. in part securities, coverage well regulatory reporting our #X across to extensive expertise Chartis regulatory as due technology. our Moving in to regulatory complex for adapting as in was to ranked jurisdictions

quarter, and build strong local signed maintained as of XX% percentage Philippines cloud AxiomSL these growth can we point continue and bookings ACV new across banks we the increase quarter as During and beginning with this Trade are India its deployed, exchanges and our momentum clients that with cloud in geographies. market delivered new Surveillance transition in relationships to as an clients now Nasdaq it X XX Surveillance upsells. as first the in across significant the of XX upsells in Surveillance X delivered advance since year. participants, and serve AxiomSL the we clients reference

upsells a of total continue X markets technology X sustained capital XX cross-sell. with momentum We to see and clients, also new in

to trade, This continue market client as Calypso Bank broadly, constructive was and XXth a X cross-sell the expand as and More Market for geographies segment see across signed which growth we upsells. strong our environment quarter Central they institutions financial signed across solutions. continued across assets our provider XX new client in its Technology structure and coverage

like division in Latin highlight our I America. global strong a And The Financial this Technology progress quarter, has presence. to would

in increase its We now Colombia. AxiomSL an through continue region which our footprint to partnership reporting Nubank, with regulatory enhanced support the using to in is responsibilities

technology We its leading delivery a with Argentina's of technology which is a client. clearing clearing through also solution. next-generation CSD significant signed to And our them signed group, BYMA, modernize of expansion an exchange we existing cloud stock our partnership

well experiencing regional American and Calypso clients XX us sought and their as AxiomSL have to Across partnership and as We're months. roughly expand and as marketplaces broad growth local new digital banks. serves payment players adopted of Tier client banking have with services X our that Latin Nasdaq range traditional banks, comprising clients, and global America, as a XX well Latin of over half in last strong XX the

just to we of America many is of helping regulatory our region, well as the market complexity one clients the market we're the institutions seeking domestic navigate Across and operations. to in their are where exchanges financial regional forward of economies clients, look evolving the international as digitizing infrastructure and continued the expansion. modernization participants critical which of many better infrastructure, modernize Latin needs serve own their are global to

revenue third as the we're where well with XX% over higher generating proprietary higher Services, record year. beta U.S. volumes in a environment, Market European by to course equities growth. alpha as Nasdaq record and for continues a quarter options. our derivatives, to the U.S. driven The was market U.S. Turning multi-listed growth options and equity index multi-listed cash In across increase options share of revenue delivered

high its year-over-year. growth, continued doubling record options index U.S. with another revenue Additionally, delivering quarter

quality remained European and U.S. Nasdaq's market cash remained equities. cash capture of accelerate. steady to was update innovate want while priorities with integrate, healthy. share to on-exchange And up market retail participation increased, members our Turning increased. increasingly now share strategic provide and as our stable on equity share an favor market overall wrapping and I equities,

with Starting Integrate.

the delivering acquisition, anniversary to clients synergies and of we of plan and integration The progress completion pleased our As for Operationally, we're extremely Adenza X-year deleveraging. unified the expense our net on with of ahead our delivering one near as are teams and continues the Nasdaq. date. I'm seamlessly,

As of in XXX. recently Nasdaq RiskTech Adenza the Nasdaq benefits combined clients, of for Chartis' our and ranked was a XXXX testament #X

the thesis acquisition forward early the Nasdaq an underpinning validation XX, last early is power and of respectively, as look Financial momentum. division, year. Nasdaq the placed in and building to of and of Adenza our we XX This unleashing on is Technology innings the this

our major We a reached the make to strong tools AI continue with during XXX% the completion our to copilot advancing of of We milestone progress the quarter developers. priority. rollout of innovate

features enhance productivity and efficiency. We AI Gen designed that to skills platform launched also custom-built internal an

platform. XX% Nasdaq detection of Nasdaq drug engaging In new financing trafficking Verafin's the months, roughly for X topology also AI-enabled launched our activity. by less products, which terrace skills of nearly employees deployed expansion with analytics, capabilities the than new targeted with headlined provides XXX and we've unique

Terrace and risk learning machine AI-based Following produce a conduct beta predictive Earlier portfolio the investment to new capability. to month, expected Calypso methodology an program, is year. this be an calculations this using extensive released later Financing also analytics Analytic announced

up to institutions most allows faster complex the of and to risk processing technology with speeds. conducting XXXx efficiency This financial improve calculations trading regulatory the

we AI, the engine and of expanding is was innovate suite Beyond true recently recognized Nasdaq products as our retail evident continue and best franchise, which new This is index capabilities. particularly products. our innovation to by structured by in provider index a within

clients, our growth our insurance X brought to products we market, sustained including -- with overlay adoption on with new annuity with see Partnering interest options international from investment and X aligned strong where focus XX vehicles, we products our investors.

expansion to on resulting U.S. productivity. XX% We migrated lower on our our and now States. launched outside X X Market ISE successfully next-generation international Nasdaq options of increased latency, new in Today, with higher running overall platform also derivatives In products throughput Fusion, United called the Fusion. are Services, remain we of markets focused

continue Financial to And across Technology on The Technologies concluding by across driven in the launched coming our Accelerate is the progress strong to in date. and lines, engagement the of The priority, quarter. Nasdaq we segments we and One spans product regions, quarters. XX%, percentage client in to Financial build pipeline above X make and pipeline opportunities cross-sell with now division expect the client cross-sells this campaigns driving our strategy, cross-sell on

headlined Nasdaq's growth. We cross-sell wrap million the exceed power solutions in us will and of consecutive model to our To launch by on up, fourth remain of to business diversified deliver of double-digit in quarter, end additional $XXX quarter strong fourth the XXXX. campaigns another enabled cross-sells track quarter the by

financial against forward growth capitalizing continue to and to priorities world's execute this challenges. momentum shareholders. most profitable the As to sustained poised We we to a clients' acquisition system partner thesis, Nasdaq complex our look has our our deliver deliver on on the strategic to solve become Adenziic trusted to

financial the I with call now that, And details. review to the turn over will to Sarah

Sarah Youngwood

continues we Thank everyone. we our pipeline proud deleveraging and synergies over revenue actioned have now net to you, consecutive of with We're Notably, is clients solutions fintech of double-digit over down strong of morning, and with in integrating our AxiomSL fourth Adena, coming from expense X.Xx, seeing and quarter are making growth, XX% XX% good we're Calypso. excellent cross-sell. share date, also progress and to and traction to

third well XX. each $XXX our in Slide EBITDA income in with resulted net $XXX XX ARPA percentage driven a drivers as XX%, margin and by for as market million, revenue billion, diluted on of results X.X percentage $X.X share expense was $X.XX. revenue and this capture. EPS existing on and growth of clients, of generated basis, of new Let's of revenue and up the our the net operating solutions points points. also million turn XX%, Slide net shows of million, quarter. XX% innovation of We up $XXX growth XX% product net up Operating X margin Overall, an to quarter We resulting X%, reported up an of XX%.

contributed valuations in and offset by primarily quarter, Indexes higher downgrades. percentage Market Overall, volumes beta growth of higher and in factors driven by points NASDAQ overall X.X this Services, delistings

shown ARR growth as growth we As of to XX, a SaaS revenue Slide of points XX%. percent X on of with increased percentage Notably, ARR had X% XX%. SaaS

results In division with Listings starting review X%. up ARR. delivered revenue $XXX of for Platforms, Capital we on Access X% million, Slide and up Let's flat the Data XX. was revenue quarter,

pricing lower higher impact listings amortization downgrades was listing new Revenue and data initial fees. prior and period offset the usage, from by of of and sales partially delisting,

quarters. to initial we million be quarterly to the X ahead, listing the for continue next impact Looking $X about expect fees from

described well improving, year XX% the seen roughly up prior was are a fewer be quarter, have should revenue and in XX% third quarter XXXX. less suggesting through third that we versus period, the year-to-date trends the delisting in Insights, Index months, offset of with revenue headwind delistings Link, and revenue by for innovative Delisting consultant with of segments. This Platforms points. particular continuation margin mainly quarter driven XX%. analytics X growth in was in AUM a Analytics driven in of up and in by as last performance, the eVestment resulting environment ARR client $XX XX%, asset In in increase by record as options Workflow ETP growth billion organic of was revenue $XXX $XX the inflows up digits. up a Operating the billion previously market net was the for including and Solutions. also futures growth X% with we Capital Data and ARR single Corporate with partially X%. of continued products, The in and average quarter in have Access XX volume billion was strong had percentage high strength owner the eVestment

our full revenue ahead, Platforms for year remains Capital growth expectation Looking Access unchanged.

expected and above outlook in in exceed Insights Index expect with essentially growth range to and Workflow its our to Data range, We medium-term come flat year-on-year expected range. its to and below come

Capital infrastructure cross-sells client bookings new that and benefited ARR all of revenue including decline was and a on Markets XXX the services upgrades $XXX XX% X of and its driven as in Technology Financial in XXXX quarter. growth in market subdivision is a as upsells cloud the converted RegTech. the to million We double-digit bookings XX% between to -- and difference the up of well delivery XX primarily which in division professional ARR and Moving from had ARR by Slide for clients, ARR fees, tech growth large growth subdivisions, revenue with growth of across proportion timing Total Fintech XX.

with against services comp revenue Crime increased a in growth higher XQ 'XX, growth Financial included a that reflecting tough revenue Technology of of XX%, fees. ARR Management professional XX% quarter XX% solid

to implementations clients. successful X shift X on-time Tier saw Tier a fees to from we and due revenue quarter, from This ARR professional services mix

are timing renewals. by value as churn, pricing, AI Additionally, changes revenue the we by such was of products, the of other This they client including minimum our deliveries. had minor in and Clients driven XXX%, showing the of enhancements Research Copilot. net entity upsell actively appreciate evidenced retention Gen new

We cohort. progress the larger SMB within are also clients making excellent with

Calypso last X% Market per clients Capital New have the X higher year. XX% year-to-date and the in upsells Notable in and XX to growth with Central annual delivered signings this year of [indiscernible] clients for ARR and Technology new had and same contract X upsells. ARR up Bank the Calypso was X up SMB period client cross-sell XX% its new significant in XX%, Asia. quarter compared the resulted XX% growth signing clients and in revenue quarter. including deals included client upsells value

deals, with be in rates, rates, and continuing in with cycle. execution sales pipeline remains always impacts revenue ARR momentum growth creating timing specific demand variation retention consistent strong our Calisto in will for sales good there enhanced our While

which Together, Technology upsells record primarily ARR XX client, new XX% X Combined includes X of included quarter prior into Trade That last growth a the ARR This $XX flotel. period. combined large has the in reflecting services the due a Tech, was Management and mentioned the Market of benefit pricing. subscription year X% Services upsells fees conversion to from said, and Market million in professional grew XX%, revenue revenue. and implementation up we

last full this the mentioned in market million this QX professional services in quarter in of market that we of fees of AR clients year tech, will XXXX. year. $XX contributed infrastructure of to had headwind abate quarter year-over-year This million As the the $XX

sales new a X% XXXX. and revenue solid in X ARR and services reflecting XX% Acumed quarter. operating new the pipeline XX%, revenue deliveries with XX Additionally, we XX% X with X recovery the for upsells. increased margin was grew date a both by FinTech and in grew leverage wins Survernance with strong year, signed ARR current of client upsells Technology performance, client revenue X% benefit new ARR. synergies. and professional to in and XX growth the the The from including underlying Regulatory and a grew strong realized X rest point increase, with revenue in XX clients percentage operating upsells. and XX% wins anticipate

our at growth XXXX expectation ahead Looking for fintech.

fundamentals continue As have the year. we the ARR we of just and expect growth, strong for to rest which discussed, we

maintain we reminder, and a in growth in As [indiscernible]. outlook Calypso AxiomSL to medium-term expectation combined for our XXXX its come within

XX% of XX% and financial towards a For competitive outlook. said, we for half technology business first We technology, capital of position in for regulatory may That expected year. come to for the the expectation timing to excellent. the towards given bit of the full renewal continue our market low of revenue a end end full year growth growth in medium-term medium-term to from rates be our in QX, the below our shift fundamentals and quarter low maintain the for XX% growth first half XXXX. management the to the demand for growth up plan our in the to XXXX of due fourth outlook we of And technology, end come our expect of the Calypso products

capture lower sequentially, derivatives benefits. increased $X plan U.S. year-on-year U.S. onetime million by revenue in decline reflecting with million, record and share options, cash other as U.S. higher Market European division options which a and derivatives European capture. Of Revenue strong and as in and the result market revenue option U.S. and of performance index and volume $X growth equities, XX%. [indiscernible] note, a audit revenue net well partially benefited Services, had higher of capture million with up offset cumulative from of volume in U.S. $XXX state as

XX%. including XX%, with was percentage North up contributor and index options, at increase. share. capture, equity market Market margin also Services equity contributions, option U.S. and growth to sequentially share America was share site a capture performance operating was market above point our take X a primary

margin up margin XX. X%, Slide points X on of EBITDA percentage expense in each. of We non-GAAP to had expansion million, and expense resulting operating Moving $XXX

for year $X.XXX We to expense to from $X.XXX are billion. tightening guidance our to non-GAAP $X.XXX billion billion the billion $X.XXX

the in We X third remain have year. actioned more full through in percentage than this we the reduction for a so year. our actioned and XX% far our point have the X of synergies percentage expect expense we have points so to far The expense growth resulted net synergies quarter.

recent non-GAAP Act. tax credit under tax due to rate Inflation obtained as well of acquisitions, decreased as the Our Reduction energy the integration

XX.X% the remain As non-GAAP Under a tax XX.X% prior in tax result, at expectations We the rate including XXXX tax rate is points lower our XXXX with expect X that regime, XX.X% in versus year-to-date previously. non-GAAP expect the catch-up. XX.X% rate of than in to X tax generally to current line to percentage we XX.X% now quarter, years. the to future

NASDAQ EBITDA of $XXX XX. down. to Slide growth flow leverage on generated the dividend and quarter allocation We Gross $X.XX X.Xx decreased in X.Xx pay million capital quarter. to last of debt to third from share due or cash free Turning paid a per approximately attractiveness our a representing ratio. shares repurchased take execution. dilution. XX% of This million million, million Thoma Bravo inside primarily annualized We X.X the our secondary employee-related of to us to program $XXX $XX the payout allowed XXXX stock, to opportunistically for advantage complete offset the

will on We focus the quarter. deleveraging fourth to continue in

the the the of powering of team's integration the advancing by proud the As NASDAQ's and fintech anniversary in close X-year I a evolution we and powerhouse. into impressed of performance our [indiscernible] results approach acquisition, am

are ideally execute next on our to positioned of growth. phase sustainable We

Adena Friedman

Q&A. are it turning We to

Operator

[Operator first the Instructions] line Owen Lau from of And from comes question Oppenheimer. our

Kwun Sum Lau

the mid strong, XX%. but management it medium-term was pretty is year-over-year, your client at XX% below financial which So tech outlook, growing was

mainly or should that said aware be in think something and of? how because of for near-term there You Verafin? of deliveries, should the else there top And the about timing we outlook we comp

Adena Friedman

significant Great. Yes, really is difference professional related the as Owen. the mentioned, to services. we Thanks,

to move and the Tier clients. Tier Xs. up those an we going have As element of market more into X implementation to We're

to implementation and X next. the more be year revenue look of as revenue could X implementation kind have might the in we timing ARR of there at we that both amount they of move variability implementations so the those when versus also And from quarter,

now mode that we well last So them third in of clients quarter. we our implementations we've moving services move in completed this year those but our up significant much means fees. have didn't implementation X implementations, And quarter that also to revenue particular that implementation but quarter, had this into more that the underway we're just as drove now professional mode, of ARR,

So to that's we some to our that something upmarket have today. it's going did be variability -- make provide we going sure that really we'll like that we continue to disclosures is business. forward there And going as on of scale

in our remain In Tier revenue we XX% for very terms our business, as SMB customer for overall We're the the confident the in outlook the management confidence of as our mid technology. well medium-term by among financial banks. excited solution X demand pipeline for space and Tier X

And some everything of zoom so revenue about continue upmarket medium we we that there. with and as all growth just of just I the could us, to are mentioned, strong that's dynamics excited over as continued happening we're in that term. we that feel momentum the expect opportunities business extremely create ahead And variability. moving there But in, some

Operator

show question I from Bank comes next line And our America. from of of the Craig Seigenthaler

Craig Siegenthaler

the I question. follow-up Verafin on have a

able have because And with? just most or Tier signing, after the of X with here Xs existing upsell the with is including your think that this the Tier how that's final Was Citi, will in X call them you is X been same the X initial in one? it start it too Tier another in new payment think wins, Axiom? start cross-sold fraud, the earnings quarter. saw signed you a is you you Or this client client last actually I First, I that from announced to early? And the then July, I

Adena Friedman

we our and our of that them are think that of they've doing starting been to have happy our additional to you same have right or the clients I the I X X with is really say, have results really them our -- implementations. expand with they're -- Yes, fraud. upsold we Thanks, have. think modules upsell and Great. And to actively with X have of And that to been working client. with we we're it continue And to Tier with actively working are clients evaluations sold Craig. presence Tier but them active already payment several of clients, X we I Tier they're the

course, not to giving us. what obviously are instantaneous of or either. tailwinds enhancements But cycles extensions of they that's so discuss And us nice take sales from further those

we're the -- we in is them all to of so of conversation that have, very, strengths but with an And across it different active our to the show a very clients. working continue process several active

Operator

line from And Morgan of Stanley. next Cyprys I show our Michael from question the comes

Michael Cyprys

you with just what was Axiom hoping about Calypso, on some to might plans particularly you how can bit in the fourth Maybe elaborate for and that's like seems are on campaigns, embark elaborate a campaigns could I the that on cross-sales your what and quarter. It you're progressing. look success additional like?

Adena Friedman

able turn takes feel the Sure. into those Thanks. And or to to through the across as more And terms division, are this go does we clients, that good as new campaigns capabilities cross-sells, in about of AxiomSL it to sales, clients and that we've been our Calypso FinTech our but sales far for Calypso Yes, also campaigns X year. we're clients. to but vice see year-to-date, had bringing Obviously, what nearing we we've as versa but so time capability tech very X well of include Verafin AxiomSL cross-sells. campaigns launching Calypso the well. market the rest working X to

real-time One is management going that platform that platform for then cross-selling for to really risk platform, focuses we to a have Nasdaq called our are real-time which product is we clients. Calypso products. we And actually, Risk exchange-traded the management great on this and instruments, as Calypso exchange risk OTC is interesting know, have be because, our we products. think, you traded obviously, very And

around launching as deal, we we're knew of So and now that, part a saw we it's the an cross-sell. And that opportunity, a that. that natural formal was campaign

mean, global And X then shareholder I AxiomSL the the global second disclosures is for third shareholder. is -- is

community, the and is broker-dealer So clients and out rules on disclosures to services new Calypso our market there clients. are which coming shareholder requirements both

campaign And so definitely a working specifically on we're on that.

the are as campaigns. focused expand those on So types of our that things we cross-sell we're

Operator

RBC Ashish show line the I our question comes Markets. from Sabadra And of Capital from next

Unknown Analyst

to wanted click is on double This the [indiscernible] earlier. Sabadra. just comments on I quick for Ashish real

Is both? as perspective. should quick quicker market -- when Tier you the the kind relatively are X. Is the maybe time for elections upcoming period? just the X, between for same clients these timing we amount issues Tier a there that . aspect, On sorry, there's of ramp-up can new onboarding on is time Any clients, client then SMBs, new there that IPO a about clarity shaping out? hurdles any share that's frame on any if of the or follow-up. you're Or cross-sells? think versus clients it new from And And

Adena Friedman

Okay, great. Sure.

So you smaller take serve go on more the we from banks the imagine, as more you timing of implementations serve, complex larger implementation, become time. and as can we therefore, to banks that the

year, company. we so all, cohort, write bank have that more we first And the medium to signed medium bank of of size in as small this

the as longer in increase do been a So XX% for to a than the this that's the why, tend because implementations small Sarah that mentioned clients those take we And client. space in SMB ACV we've year had sold medium-sized clients. they've more

the X. they're on and months And client, complexity anywhere of we medium completeness that from the say the would implementing and day kind client for what also to XX of X really depends

to to you that's the With to X XX client. far XX the so could when more X large least. Tier it Tier anywhere in X, X like land implementation at first but for also be from clients, months, the And like months like

they a of still, a with lakes have, their to lot a the of capability because large quicker, data but that second a integrations lot it can go upselling and dealing the already you're and you're internally we've going If built institution. with systems

yet of a we don't there. lot management. on program lot upsell a have you of have management and project experience So And

So fairly long. that, a is shorter still going time but to that it be could we're to implementation, hoping be

had just mean I market. becomes And of more that's had why IPO it's comp an element professional and that you're the services a year a IPO as timing fees professional the medium year-over-year our fees this market, that of dynamic last services think more revenue with the regard I with larger year. banks. banks just And issue. that And the is we dealing to

shoots. rate had have XX% green in We XX year-to-date. some been win the a it's really IPOs Well, we're quarter -- proud seeing to

And to good market. hopefully been get to I are so better also those pitching environment. lot today, a that rates have to great and will have in also just a benefits that can Nasdaq. that that with companies the actually in come demand want of you of pent-up think it And continue and very environment, to of rate to see the feel We up a as with moderating pipeline. to a robust inflation Fed talking in line active energy our we we lot economic there's more It's clients,

first usually But rest anyway. see you going I a the that quarter active lot this it's of a should won't assume into just even because we quarter, think noise. of And year very into other the not

some transition still there'll there. think be I

seeing much So more we're next kind of aiming be year a active hopeful and towards beyond, we're momentum could QX that more and in it year.

Operator

from the Sandler. I show Piper comes question Patrick And Molly our next of line from

Patrick Moley

the target the expect that scope are And campaigns running overall that to cross-sell revenue cross-sell of in you standpoint, campaigns of cross-sell get from on that do we you're million fourth allow just journey? follow-up think of XXXX. you're end you Where I revenue the in that $XXX compared the just to by the the campaigns. will running? then opportunity . a how is a large that The quarter currently the in new to have campaigns

Adena Friedman

-- Yes, great. they sorry, for solutions Well, I'm specific new of contribute campaigns the for fintech counts. kind I but overall client every growth don't and the we opportunities to disclose all mean, there, expectations

progress said, in to success XXXX, putting point brought the teams brought had We've tooling put getting we've the the together. type together. lot operations our the, as what want We had in actually We're a significant out very we're there. sales in very that of systems call, place. a I just all We place. client early journey So integration. and tech, in rev tech of I'll all of we

a And in this X cross-sells. I'm a been yet, even for really delivering we And so year, year. well so building we're we're have really of has building the also team proud And that. across fintech. --

So it's early, early.

more We is XX% than opportunities. cross-sell our have of today pipeline

to say exceeding always million, least this have to going $XXX path We $XXX there's the linear that isn't we be -- said million. at a

will over be going not to build couple that do it's expect of linear the path. But So momentum a we next years.

short. As technology you is cycles solutions these mission-critical know, not in sales

We've but first implementation. had of terms So signing, a the anywhere. -- to started of we've talking deals where few of from most couple XX a signed and to like had you're months X conversation like take to in months get

Operator

the KBW. And line Kyle our I from comes of show from Voigt question next

Kyle Voigt

more on focus to a in international for bit the Axiom. wanted opportunity Just

guess, rate you you developed success first the Latin certain your penetration India, Philippines, the in geographies noted noted Colombia or you markets? frame when the opportunity look more in in and I America. market can us here You help clients in international at share also

more regulatory how you or international new maybe displacing growth markets in meaningful markets give then, could us could or the international if then within some therefore, displacing any just frame be these functionality? color you're as competitors in-house rate even Axiom. to of reporting And if the . these it's really whether frame also international some And just or

Adena Friedman

Sure.

Okay.

So the global we're I is is geographies them that geographies certain into geographies right certain there there are really, AxiomSL today. then you're where really where is AxiomSL and But where Nasdaq think are bringing strong. is first strong, thing

example So the to we exchange are provider Philippines technology the is the X of there. where

the relationships We central with have community there with good the there. and financial regulators

banks reporting a was may they for it . And an weren't engage like using help us needs. reporting. international instance, already within And in an that to could their it for We bank, really used financial go space the have because regulatory a that for be upsell AxiomSL -- great the Philippines difference domestic upsell. it the manage but in bank it to opportunity was them said so they gives the is and

but them are domestic exciting. really using And the were to requirements. us for domestic make with So working India, international we They us reporting their domestic. connected now with them the now is we've the using reporting for in deliver bank not same reporting regulatory the and which for requirements, with sure we can

And open a that, could huge India for up of in opportunity course, us.

may have great really the Nasdaq been AxiomSL we an America a as last these not AxiomSL really where has up where have have presence. XX country built Calypso see presence, strong been a actually area stronger land had we great expand but in and Latin presence just has in a over years, strong. So And and Latin America.

really clients XX been I bank have about operators, way use and and engage there. over to it it's now with has We XX think that technology. a a have our fun we us market that broker-dealer for our fun clients been

which great So we've a on when rather up just bank, been or they're realize bank, support area us I a bank. that an And presence. advanced with if know them where they actually as more they expand regulatory digital great that's what's it's mentioned already Colombia pan-Latin expanding had to Brazilian don't so client Colombia because use their presence we to us new coming there. is want see to gives a way was a Colombian requirements. work technology But it I into to America. But they're our a

just provide do in fintech, disclosures of because there. We can pretty international give So exciting. global everything we not growth it's you do consider an we'll how kind we is rate

Operator

question line next And from Cho JPMorgan. of Michael the I from show our comes

Y. Cho

clients? a new And about you see pricing know from opportunities start and maybe Copilot or to get wanted campaigns, to AI entity existing a broader of an for areas context We There the help upgrade where mentioned in can on second. just but with there the you Calypso, trying we I AxiomSL Corporate clients. ahead rollout existing features pricing are Verafin, and of is just think broadly. like research touch for Solutions some . when more but I update on upgrades pricing

Adena Friedman

features, Copilot, using providing kind the little go clients look entity research we we really not how within them that we to we service, management way way, just in just crime different before of into much our . And the them. work much the Well, or the that. with it. clients, actually -- have renewal, value we they've product see And work we financial are a Sure. specific But bank pricing work grown, to upon terms. anti-financial is technology. to by how have contract based the and on a then using by with Yes. charging at and explicitly much as them. to with way product But we're are half generally for crime we regard with how with work the we Thanks. fintech, in X-year they're

half are clients out capability. rolled the to of engaging seeing we and that banks, So that it X,XXX we're

the the they're clients So, getting far, that terms great. it's feedback fantastic some that. from of gains so really getting from efficiency in

that would and renewal So on renewal we of be part that of in upsell on terms the pricing. the the conversation get

can we we upon are to that can then and we again, And lot years fintech a space. we that look them delivering then year-over-year. actually of do average contract. they to with regard the do the escalation value kind value platforms, broader to in to charge those a at the X And tend that capabilities next for will products X as terms is of be more our see have in renewal, we more CPI for And

the engage into of have value just think So ways or lot but yet adding in pricing, good to AI we charge the on we to them aren't we're choosing explicitly I dimensions do a multiple product. capabilities,

Corporate [indiscernible], little it's a With different.

We have to that launched let's allows module paid it, sustainability companies actually call Insight to peers. a is sustainability lens a module, their new disclosures IR compare within that other

things And so those explicitly but charge every not we where of in are the might types for way.

enhance new But see that board get that be retention that's and and So in also board not will we're portal charged way for. added explicitly feature we a our doing sales. an as summarization tool, to just

answer, long that's approach it. So sorry, kind of it's we a how but we

Operator

question I And next line of from the comes from Fannon show . our Jefferies. Dan

Daniel Fannon

momentum building. on of is Market Tech wanted comments It follow on the the up some like to I sounds business.

services think have going into professional said comp I you still the into XQ. tough should next build you year, but

of rolling revenues a kind So roll and versus that just bit system. putting more that still of hoping the the growth through those contracts -- we in of think fees how the momentum terms the into contextualize just and professional next are kind year, of off certain to maybe about

Adena Friedman

all, starting fees resources pointed this would that say, we we meaning in professional And sales I to had out, a have had of the important lot it's implementation fourth where a the project. kind that million fourth really year-over-year in of in client year. peak a Well, in of in a also, this tough won't abate terms were $XX year-over-year we've level that last year, that we've doing that comp in first last -- we of of . And regard services year to had resulted of XXXX think you X against so amount Yes, to, fair sure. them comparison of quarter of starts note year. That as given that I gotten with quarter. we disclosure

the So XX we've just had new quarter, upsell. in a couple but also clients, of

to few their least So actually, for now as to be to a we a markets. cloud have really really exciting solution see them been it's starting there. do discussing their on a why cloud-ready focused years. They're clients And at been drumbeat with understand momentum future. delivered That's modernizing or to we've is great are important that going really a

sales. it's turn contracts and that to into starting really exciting it's So to see

are seen The their as and we've their products in our clearing CSDs solution. solution working we've settlement been uptake then well. to strongest trading have had a they're upgrade decades also, old, us finally our that exchanges lot our with And next-gen and in of solutions realize

hopefully that been said, -- of quarter. But of as $XX comp, third ARR the in a into it's converted the as million, it's it's year. right think good a got the you tough certainly and $XX So good we we that And we that through back a the that I show beginning million feel business. you in should growth year throughout next into got we whole growth get also able services professional be the to we've can to better going momentum like think

Operator

the Sachs. . Goldman from Blostein comes question Alex from of And our I show line next

Alexander Blostein

progressing the I Adenza There's growth and I few I guess, out takes, was happy change the have into this little zoom a it earlier accounting been to a bit. business. sounds nicely, about revenue puts outlook momentum the integration. hoping talk year and on out with ultimately meant of XXXX, guys look a the to smooth second and just kind the in for you that, you're out for guess, sales like you is with is as near-term

those revenue little talk for growth XXXX maybe AxiomSL a of and about expectations Calypso. both businesses, bit So

Adena Friedman

business Well, mid-teens Sure. said ARR revenue one, businesses revenue outlook a number kind I have mid-teens overall is, to far so growth, medium-term ARR -- we give what and of on growth. think progressing Everything we're is seeing is Agenda consistent so terms momentum of how with we've certainly and we and consistent. and been -- with the the of healthy how and for we've see that in far active we've kind both and strong of we kind been you growth low the delivering

business it's certainly, we right evaluating been . with within I like feel we we've its outlook. see the the that's we looking think as can performance Nasdaq, now. as But consistent say medium-term far at So as where and

Operator

comes Budish I Benjamin of from our question And the next line from Barclays. show

Benjamin Budish

tends there. bigger I be you year mute wanted -- be know QX I there. a is cycle. and could I booking to up to for see next Alex's the expected on follow Apologies had tends to quarter I to on question biggest if be just upgrade Axiom,

is what or like cycle give reasonable looks services here? So factors? should we revenue more I'm upgrade ARR of can see a wondering How growth you should we in can What different Maybe those be sort of more if there's big if the thinking professional a more we And of any an about acceleration? explicit expectation? you see provide guidance color of there? more maybe on what like. sort Should sort

Adena Friedman

Yes. Sure.

of of how thinking So year? I'm see say upgrade Whether in is AxiomSL I'm strong demand well, it's a going bigger -- general for not to would and all, next first cycle that. or I active. just kind about

this year. I like of sales think QX of really into coming you this of are We've had right. good year. more kind And kind it's QX

next professional opportunity had do year last AxiomSL. fees versus to had as that through year the of professional decline sales services So because a fees we've the this we in that see services to should strong year a go for as recover accrue in we benefit year. We

to through job the mentioned. just walking Sarah though, as some revenue other, a a you if that. to general, and ago, just services create revenue to can teach-in within the fees are that ARR out, consistent month The did we've There be that listen the each on to variability point ratable professional moved subscription always. want that and In we've want are nice should thing not AxiomSL, differences, I everyone, remind relatively with

talking the next look better us, that sales year be can services this opportunity renewing things so we at about as we beneficial those progressed year. of we've professional and to of through to have versus as a for as you're see contracts, year year-over-year and upsells, an kind And how

just is to when remind a contract renew half client. value recognized Calypso, of upfront new think I a sign client the with we you, or that

there, have that and differences But we're year-over-year really how why really strong the So that's tend delivering. of just demand that creates year-over-year and business there, really we you're more driving gives variability really now, quarter-over-quarter, that focus consistency with progressing. can revenue. in in to implementations. also comfortable that But right sales And how we're good doing on and is you ARR because momentum, again, seeing

Operator

And I Cowen. the comes show Bill of our Katz question next from line from TD

William Katz

recently the just I'm be it's might implications SEC morning. busy you curious, X passed sort in your tick the platform? perspective a love it. about for parter. been or of this what prepared And I'm the a unintended either covered talked remarks, then who get intended maybe could for Sarah, to I curious the on by if sneak your and Maybe Adena, in you, I'd rule

was end versus low a adjusted wide You range the I implicit non-GAAP high gave relatively frame the what would expenses. fourth end?. quarter for wondering

Adena Friedman

answer Sure. to hand it Sarah. Yes, rule, over the I'll I'll and SEC take

been size and with then see the tick we benefits SEC, has rule as the and an interesting So some concerns. the some rule process having

is a really does perspective, material performance have One role when not X Services it improve key But anticipate that do like Now impact will we evaluate lit on experience have markets offer? Nasdaq just investors financial will Market on the [indiscernible] sure in offer. how is terms . And [indiscernible] the we something our a for then that, it investors any in how from does it markets and how parameters. really focus our so the that rule the in business. revenues supply reflect ability making to improve part demand as the it the that that better tighten a of have. it So and make that that, does we

One the tick X so if unpack things. the sizes. And we are the rule, contents is there of

for they're market to So price That's narrowing the $X.XXX for smaller tick discovery. we think size in from market, $X.XX the that's and good. stocks our good

I the -- the the companies. able proper constrained lit to in really good stocks have demand exchanges think them and reflect we where supply tick not that's call these markets, been market for smaller

that's benefit to so And a markets.

been that X is protection, lots is component for access fees. We had the is odd really focused that be second been But recommending on also proportionate and consistent suggesting very think positive we've which price to The and our just comments on, the but small, to a changes they subject that's having at to we fees. in markets. SEC access the look area we're

makes commensurate. incentivize down then a change stocks a should it they regime, they fees. much And was it's down lit so take penny harder should fees did access orders. to for have But access maintain those $X.XXX for So And those have the all markets what access in that that ultimately to that come the by X/X. fees

to put we spin spreads, bad into capital lit to And And not as makers incentivize so out markets, it it the market investors. that widen could we if are the see their able book. will the for

It's rebates, kind are on going to we not on fees that. significant definitely a investors. way, impact significant access know, impact of The and really you focused we a going to have have have so And as on it's us.

So we going want that kind we're to steps evaluating make to and next are sure take assessing there. determine what to we that of that

Sarah Youngwood

terms of first in the of So tighten we it. all, did expenses,

very first the in if of on. piece make have be timing all, what you can So terms at in investments. the the always range quarter, variability look like and higher, could important there marketing midpoint investments a happen margin, the you we're revenue-related now fourth The of it's go that same some versus timing could is And it the revenue. lower in the around and next quarter and of of the

Operator

Simon Clinch the And from line our I show next Atlantic. question of Redburn from comes

Simon Alistair Clinch

but quarters, we're also to you if now. referenced just good, pushout pretty quickly sense renewal environment sounds which of talk of about you think, Calypso up -- right the it's I potentially talk environment?. that could that could the means you terms in X a I what It by renewal, wondered Just guess a renewal for give the to join then in like actually I

Adena Friedman

Sure. a situation. Yes. very That's specific

clients So very in that's client of that Calypso. recently a actually we're actively long-standing upsell taken They've engaged. in

doing know to are how it renewal well we pleased advance decided to -- against date, closer the bit opposed to they in that timing decision they've their So the want to advance renewal structure little and to they date. had platform, of with renewal it really a do make very as that their just date in but their with

into to nothing situation. very that So read there's specific. It's

does you just these were wanted we the sure recognize of revenue mission-critical provide quarter. on here. about quarter, impact But just and into upfront understand In have read on because renewal that to revenue Calypso's We the the we general, to strong. that technologies of the is fees, an it. help make how to this fact license half very But it to nothing environment disclosive is kind evaluate

and rates high a they fintech their being our responsive and of really with renewal them retention -- as clients needs it's very and dates. about have working to We solutions think matter just across the their

Operator

comes in the last . from question Brian queue Bank. the Bedell showing I'm from Deutsche

Brian Bedell

my I'll and of Most answered. were quick. be asked questions

from online Just to that like this . coming as the retail revenue on broker what And into you the XXXX? seeing comment just you business. extent options the on index platforms. contribution to Can are you're what marketing

Adena Friedman

nice Okay. been a Great. to it grower revenue. really us. contributor for still Well, It's small has a

mean, to index. we that contributor growth, all still love more more business. a small the a I it's momentum, options that the we're become, overall overall we hopeful contributor the big to So love obviously, and but But will revenues.

into hedging their retail, then overlay see opportunities index the them we often of retail mentioned, and we we coming on and well. our terms a demand to of platforms. driving, for lot see their for are are for that also them getting the inclusion data a you a options in as ETFs those ETFs have us an because strategies platforms, we -- lot be of as actually index . International also In we the see international as develop major investors broker-dealers in as internationally. opportunity our that really that and We we flow help retail and grower having from think an be yes,

are now. those areas So the most on focused we're that right

Operator

Chair session. time, turn this I'd our Q&A concludes back for That closing to the call remarks. and At CEO, you. Friedman, like to Thank Adena

Adena Friedman

clients, that value day. a joining, employees. continue growth execute Great. drive Thank for on to and we'll additional confident to heard you. you for Well, Thank And morning, this and we're continues NASDAQ and we . as growth NASDAQ our drive strategy, across you our great shareholders our One as have business.

Operator

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

now may disconnect. You

Nasdaq (NDAQ) 24 Oct 242024 Q3 Earnings call transcript