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Cboe Global Markets, Inc. (CBOE)·Q1 2025 Earnings Summary

Executive Summary

  • Record quarter: net revenue $565.2M (+13% y/y), diluted EPS $2.37 (+21% y/y), adjusted diluted EPS $2.50 (+16% y/y). Management raised 2025 organic total net revenue growth to mid-to-high single digits and reaffirmed adjusted opex guidance ($837–$852M) .
  • Beat vs consensus: Q1’25 adjusted EPS $2.50 vs consensus $2.36 (+5.8%); net revenue $565.2M vs consensus $562.4M (+0.5%)*. Values retrieved from S&P Global.
  • Broad-based strength: Options (+15% y/y), Europe/APAC (+18% y/y), Global FX (+16% y/y); Cash & Spot Markets (+10% y/y) despite U.S. on-exchange share headwinds .
  • Tactical catalysts: robust April activity, zero-DTE engagement, Robinhood rollout of index options, and new cash-settled Cboe FTSE Bitcoin Index futures on CFE launched April 29 .
  • Leadership transition as Craig Donohue becomes CEO (effective May 7), reinforcing optionality for organic and selective inorganic growth .

What Went Well and What Went Wrong

  • What Went Well

    • “Broad-based strength” delivered records in net revenue and adjusted EPS, with Derivatives +16%, Cash & Spot +10%, Data Vantage +8% y/y .
    • Options: record net revenue $352.4M (+15% y/y) on 23% total options ADV growth; SPX/XSP/VIX activity robust and overnight index options volume at records; April volumes remained elevated .
    • Data Vantage momentum: organic net revenue +8% y/y; new recurring ACV +47% y/y; 55% of new data sales outside U.S., supporting international expansion .
    • Technology resiliency: completed migration to Cboe Titanium; processed over 1 trillion orders/data events across 27 markets on April 7 .

  • What Went Wrong

    • U.S. Equities on-exchange market share fell to 10.5% from 12.8% y/y amid higher industry off-exchange share; net transaction & clearing fees down 9% .
    • Total options market share dipped to 31.1% (from 31.3%); total options RPC declined 4% on mix shift (index options lower share of total volume) .
    • Section 31 fees surged to $153.1M (from $42.1M y/y), pressuring gross-to-net conversion within Cash & Spot and Derivatives revenues .
    • CFO flagged reacceleration of marketing spend and higher short-term incentives given strong April, tempering near-term opex tailwinds .

Financial Results

MetricQ1 2024Q4 2024Q1 2025
Total Revenues ($USD Millions)$957.2 $1,107.6 $1,195.0
Net Revenue (“Revenues less Cost of Revenues”) ($USD Millions)$502.1 $524.5 $565.2
Diluted EPS (GAAP) ($)$1.96 $1.86 $2.37
Adjusted Diluted EPS ($)$2.15 $2.10 $2.50
Operating Income ($USD Millions)$282.4 $298.5 $353.9
Operating Margin (%)56.2% 56.9% 62.6%
Adjusted Operating Margin (%)61.6% 61.0% 66.0%
EBITDA ($USD Millions)$337.1 $316.6 $383.7
EBITDA Margin (%)67.1% 60.4% 67.9%

Segment net revenue ($USD Millions):

SegmentQ1 2024Q4 2024Q1 2025
Options$307.4 $324.3 $352.4
North American Equities$92.6 $94.9 $94.6
Europe & APAC$54.1 $56.2 $64.1
Futures$30.5 $30.2 $32.8
Global FX$18.4 $19.4 $21.3
Total$502.1 $524.5 $565.2

KPIs (selected):

KPIQ1 2024Q4 2024Q1 2025
Total Company Options ADV (000s)14,833 15,673 18,183
Total Options market share (%)31.3% 30.4% 31.1%
Total Options RPC ($)$0.299 $0.281 $0.287
SPX Index Options ADV (000s)4,089 4,040 4,771
U.S. Equities – Exchange market share (%)12.8% 10.8% 10.5%
Europe Equities market share (%)23.7% 24.6% 24.8%
Global FX ADNV ($B)45.3 45.6 51.9
Global FX net capture ($ per $1M)$2.62 $2.72 $2.77

Consensus comparison:

Metric (Q1 2025)ConsensusActualSurprise
Primary EPS ($)2.36*2.50 +5.8%*
Net Revenue ($M)562.4*565.2 +0.5%*

Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Organic total net revenue growthFY 2025Mid single digits Mid to high single digits Raised
Data Vantage organic net revenue growthFY 2025Mid to high single digits Mid to high single digits Maintained
Adjusted operating expenses ($M)FY 2025$837–$852 $837–$852 Maintained
Depreciation & amortization ($M, excl. acquired intangibles)FY 2025$55–$59 $55–$59 Maintained
Effective tax rate on adjusted earnings (%)FY 202528.5–30.5 28.5–30.5 Maintained
Capital expenditures ($M)FY 2025$75–$85 $75–$85 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3’24 and Q4’24)Current Period (Q1’25)Trend
Index options/0DTEQ3’24: Index options growth; RPC uplift from mix . Q4’24: options volumes strong; market share down vs 2023 .SPX ADV +13% y/y; XSP ADV +61% y/y; 0DTE ~2M contracts/day, 55% of SPX; Robinhood broadened index options access; elevated April volumes .Accelerating adoption; deeper retail/institutional engagement.
Technology platform (Titanium)Ongoing resilience noted in Q4 .Final migration completed; processed 1T+ events Apr 7; focus on durable tech and innovation .Platform fully migrated; reliability showcased.
International/APAC expansionQ3’24: EU/APAC net revenue +22%; Europe share gain . Q4’24: EU/APAC +17%; regional shares mixed .Onboarded clients in Korea/Taiwan; 55% data sales ex-U.S.; APAC sales expansion; EU market share up to 24.8% .Continued global momentum.
Cash & Spot market structureQ3’24: healthy industry volumes; off-exchange share elevated .U.S. on-exchange share 10.5% vs 12.8% y/y; off-exchange ATS block 17.7%; Section 31 fees heavy .Persistent headwind from off-exchange; regulatory fee drag.
Crypto derivativesTransition of digital futures to CFE planned (Q2’25) .Launched cash-settled FTSE Bitcoin Index futures (XBTF) on CFE Apr 29 .Product suite expanding; early engagement.
Capital allocationQ4’24: no buybacks in quarter .Repurchased $30M in Q1 (145k shares @ $207.04); dividend $0.63/share; $650M authorization remaining; Apr buybacks continued .Opportunistic buybacks; balanced returns.
Leadership/strategyN/A.Craig Donohue appointed CEO (effective May 7); focus on organic and value-accretive inorganic growth .Governance catalyst; strategic optionality.

Management Commentary

  • CEO: “Record quarterly net revenue of $565M, record diluted EPS of $2.37, and record adjusted diluted EPS of $2.50… The second quarter is off to a robust start” .
  • CFO: “We are increasing our organic total net revenue growth guidance range to mid to high single digits… and reaffirming our full year adjusted operating expense guidance” .
  • Global President: “All-time quarterly, monthly and single day highs in SPX… zero-DTE averaged almost 2 million contracts in Q1, up 29% y/y and 55% of overall SPX volume” .
  • COO/Technology theme: “Completed our final equities exchange migration to Cboe Titanium… our exchanges have demonstrated remarkable resilience and reliability” .

Q&A Highlights

  • CEO succession and M&A posture: Board selected Donohue for global derivatives experience and CEO track record; balanced focus on organic growth and selective inorganic that “moves the needle” .
  • Retail dynamics: disciplined behavior with 95% capital-at-risk strategies; retail remains engaged through volatility spikes; SPX and XSP adoption strong .
  • APAC investment: boots on the ground; local-language sales; onboarding in Korea; indirect engagement via buffer/defined-outcome products; 55% of new data sales ex-U.S. .
  • Capital return: opportunistic buybacks resumed post-earnings; preference for repurchases over deleveraging given fixed-rate notes ~2.8% .
  • 0DTE trajectory and ecosystem: continued engagement across SPX/XSP/VIX; balanced liquidity; healthy call ratios; intraday options not an active pursuit currently .
  • Competitive landscape: breadth/depth of liquidity in SPX/VIX complex and decades of innovation underpin share defensibility vs look-alike products .

Estimates Context

  • Q1 2025 results vs consensus: adjusted EPS $2.50 vs $2.36 (+5.8% beat); net revenue $565.2M vs $562.4M (+0.5% beat)*. Values retrieved from S&P Global.
  • Implications: Upward revisions plausible for FY organic net revenue trajectory given raised guidance and strong April start, while opex guide reaffirmation suggests limited margin dilution near-term .

Key Takeaways for Investors

  • Derivatives-led engine (SPX/XSP/VIX) plus global expansion continues to drive double-digit net revenue growth; April activity and zero-DTE adoption point to sustained tactical demand .
  • Guidance raised for FY 2025 organic net revenue; expense discipline maintained—supports margin resilience and EPS trajectory .
  • Headwinds in U.S. on-exchange equities share and elevated Section 31 fees persist; watch mix shifts and regulatory fee line for cash & spot profitability .
  • Data Vantage momentum (ACV +47% y/y; ex-U.S. sales 55%) strengthens recurring revenue base and international cross-sell into trading businesses .
  • Crypto derivatives expansion (XBTF futures, ETF index options) offers optionality to capture institutional risk management flows, with measured rollout in a regulated framework .
  • Capital returns remain opportunistic (buybacks, dividend), supported by >$1B adjusted cash, low net leverage, and fixed-rate debt profile around 2.8% .
  • Leadership transition to Donohue is a strategic catalyst with experience in scaling derivatives and executing large, accretive transactions .

Values retrieved from S&P Global.