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Nasdaq is a global technology company that provides platforms to enhance liquidity, transparency, and integrity in the global economy, serving corporate clients, investment managers, banks, brokers, and exchange operators . The company operates through three main business segments, offering a range of services and solutions that cater to different aspects of the financial markets . These segments include Capital Access Platforms, Financial Technology, and Market Services, each contributing significantly to Nasdaq's overall revenue .
- Market Services - Provides trading and clearing services across various asset classes, ensuring efficient and secure transactions.
- Capital Access Platforms - Enhances liquidity, transparency, and integrity for corporate issuers and the investment community, including Data & Listing Services, Index, and Workflow & Insights.
- Financial Technology - Offers risk management, regulatory reporting, and capital markets software solutions, including AxiomSL and Calypso, to meet the growing demand for financial technology services.
- With the significant decrease in professional services revenue following the completion of a major client project last year, how do you plan to sustain and grow revenue in the Market Technology segment, especially considering the tough year-over-year comparisons and potential roll-off of certain contracts?
- The pushout of a key Calypso client's renewal by up to two quarters has impacted your revenue recognition this quarter; does this indicate potential challenges in the renewal environment for your fintech solutions, and how might this affect your revenue expectations in the near term?
- Despite generating strong free cash flow, your leverage ratio remains relatively high at 3.8x; how does this elevated leverage impact your ability to invest in growth opportunities or return capital to shareholders, and what are your plans to deleverage more aggressively?
- Given the decline in listings revenue due to lower listings activity and prior year delistings, what specific strategies are you implementing to rejuvenate growth in your listings business, especially in the face of competitive pressures and a modest uptick in U.S. listings?
- While you've seen some success in upselling Verafin solutions to Tier 1 and Tier 2 clients, lengthy sales cycles pose a challenge; how are you addressing these challenges to accelerate revenue growth in your anti-financial crime technology offerings?
Competitors mentioned in the company's latest 10K filing.
- Cboe Global Markets, Inc. (Cboe) - Competitor in U.S. options markets and cash equities .
- Miami International Holdings, Inc. (MIAX) - Competitor in U.S. options markets and cash equities .
- Intercontinental Exchange, Inc. (ICE) - Competitor in U.S. options markets and cash equities .
- Members Exchange (MEMX) - Competitor in U.S. options markets and cash equities .
- BOX Options Market - Competitor in U.S. options markets .
- The Investors Exchange - Competitor in U.S. cash equities .
- Long Term Stock Exchange - Competitor in U.S. cash equities .
- Toronto Stock Exchange (TSX) - Principal competitor in Canadian cash equities exchange .
- Euronext N.V. - Competitor in European cash equities markets .
- Deutsche Börse AG - Competitor in European cash equities markets .
- London Stock Exchange (LSE) - Competitor in European cash equities markets .
- Cboe - Competitor in European Multilateral Trading Facilities (MTFs) .
- Turquoise - Competitor in European Multilateral Trading Facilities (MTFs) .
- Aquis - Competitor in European Multilateral Trading Facilities (MTFs) .
- Eurex - Competitor in trading and clearing of options and futures on European equities .
- ICE Futures Europe - Competitor in trading and clearing of options and futures on European equities .
- London Clearing House (LCH) - Competitor in trading and clearing of options and futures on European equities .
- Systematic Internalizers (SIs) - Competitors in European equities markets .
- Core banking solution providers - Competitors in Financial Crime Management Technology and trade and market surveillance businesses .
- FinTech start-ups - Competitors in Financial Crime Management Technology and trade and market surveillance businesses .
- Enterprise solution providers - Competitors in Financial Crime Management Technology and trade and market surveillance businesses .
- Point solution providers - Competitors in Financial Crime Management Technology and trade and market surveillance businesses .
- AWS - Partner in cloud-based exchanges and market technology offerings .
Recent developments and announcements about NDAQ.
Financial Reporting
- 2024 Net Revenues: $4.6 billion (GAAP) and $4.7 billion (non-GAAP), reflecting a 19% increase over 2023, or 9% growth on an adjusted basis.
- Q4 2024 Net Revenue: $1.2 billion, up 10% year-over-year.
- Annualized Recurring Revenue (ARR): $2.8 billion, a 7% increase year-over-year, with SaaS revenues growing 14% and representing 37% of ARR.
- Financial Technology Revenue: $438 million in Q4, up 10% year-over-year, or 7% on an adjusted basis.
- Index Revenue: $188 million in Q4, a 29% increase, driven by $80 billion in net inflows over the trailing twelve months.
- GAAP Diluted EPS: Fell 7% for 2024 but grew 72% in Q4 2024. Non-GAAP diluted EPS was flat for the year but grew 5% in Q4.
- Solutions Revenue: $949 million in Q4, up 10% year-over-year, driven by growth in Index and Financial Technology.
- Market Services Net Revenue: $268 million in Q4, up 8% year-over-year, with strong performance in U.S. equity derivatives and cash equities.
- Index Business: Launched a record 116 new products in 2024, with $80 billion in net inflows and a record $647 billion in ETP AUM at year-end.
- IPO Leadership: Nasdaq led the U.S. market with 180 IPOs in 2024, raising $23 billion in proceeds. It achieved an 80% win rate among eligible operating company IPOs.
- Integration of Acquisitions: The integration of AxiomSL and Calypso was completed, achieving $80 million in net expense synergies a year ahead of schedule. Nasdaq now targets $140 million in annual cost savings by the end of 2025.
- Cloud Transition: Cloud bookings for AxiomSL and Calypso reached 60% of new annual contract value in Q4, increasing the cloud mix of ARR to 27%.
- Financial Crime Management: Achieved 23% ARR growth with 114% net revenue retention. Nasdaq Verafin added 102 new SMB clients and launched in Europe.
- Dividends: Returned $138 million to shareholders in Q4 through dividends.
- Share Repurchase: Repurchased $181 million of senior unsecured notes in Q4. As of December 31, 2024, $1.7 billion remains under the board-authorized share repurchase program.
- Non-GAAP Operating Expenses: Expected to range between $2,245 million and $2,325 million.
- Non-GAAP Tax Rate: Projected between 22.5% and 24.5%.
Earnings Report
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7 days ago
Nasdaq, Inc. (NDAQ) has released its fourth quarter and full-year 2024 earnings results as of January 29, 2025. Below are the key highlights and trends from the report:
Financial Performance
Key Business Highlights
Strategic Execution
Shareholder Returns
2025 Guidance
CEO Commentary
Adena Friedman, Chair and CEO, highlighted 2024 as a transformative year, emphasizing Nasdaq's progress as a scalable platform company and its focus on innovation, cross-selling, and client relationship expansion.
CFO Commentary
Sarah Youngwood, EVP and CFO, noted that Nasdaq exceeded its revenue growth and profitability targets for 2024, reflecting strong execution and long-term growth potential.
Conclusion
Nasdaq's 2024 results demonstrate strong financial performance, strategic execution, and leadership in key areas such as IPOs, index innovation, and financial technology. The company is well-positioned for continued growth in 2025.
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