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Nasdaq 2Q earnings beat Street as demand for its trading technology and data services surge

The tech-laden Nasdaq secured 89 new listings in the second quarter achieving a 74% win rate

Nasdaq exchange
Nasdaq reported earnings of US$1.18 per share on revenue of US$615mln

Nasdaq Inc (NASDAQ:NDAQ) posted second quarter earnings Wednesday that beat Wall Street estimates as demand for the New York exchange operator’s trading technology and data services surged.

For the quarter ended June 2018, Nasdaq reported earnings of US$1.18 per share on revenue of US$615mln. After stripping out one-time items, the earnings narrowly beat Wall Street expectations of $1.17

Revenue grew 3% on a year-over-year basis with 7% of the gain from organic growth, 1% from advantageous foreign exchange rates and 5% reduction related to the net result of acquisitions and divestitures.

The stock was down nearly 1% to US$93.79 on a broad market pullback.

READ: Nasdaq is king of the tech IPO with 151 new listings in the first half of 2018

With Adena Friedman at the helm in recent years, Nasdaq has been beefing up its operations in information services and market technology, areas that grew by 22% and 14%, respectively in the second quarter.

“I am pleased to see another period of strong organic growth in the second quarter of 2018, in particular the portion of that growth sourced from expanding the ways we serve our clients," said Nasdaq CEO Adena Friedman.

"We are strategically repositioning the company, as demonstrated by the completion of our business divestiture in April and our continued organic investments to implement the Nasdaq Financial Framework technology offering and advance our information services businesses," she added.

Among the drivers were record assets under management of US$187bn for exchange traded products tracking Nasdaq indexes, as well as the group’s efforts to ramp up the number of customers using its trading technology.

Nasdaq now has five clients in the cryptocurrency space that will be using its technology for trading, clearing or surveillance.

Revenue from the information services unit rose 21.5% to US$175mln, while the listing services unit contributed US$72mln, which was 12% of total revenues.

Nasdaq said market technology order intake rose 18% year-over-year in the first six months to $109mln and new deals were signed in the second quarter to provide post-trade technology to the National Stock Exchange of India, and the SIX Swiss Exchange, each leveraging the Nasdaq Financial Framework. 

King of the tech IPO

The tech-laden Nasdaq secured 89 new listings in the second quarter, including 56 IPOs. 

All told, Nasdaq achieved 151 new listings in the first six months of 2018, raising nearly US$15bn

“Nasdaq Stock Market led US exchanges for IPOs in the second quarter of 2018 with a 74% win rate, while strong Nordic listings growth continued,” said the earnings statement.  

Nasdaq's Nordic, Baltic and First North exchanges secured 29 new listings including 22 IPOs and six upgrades bringing the total of Nordic-listed companies to 1,008 by June 30, 2018.

Nasdaq reported earnings of US$1.18 per share on revenue of US$615mln

Contact Uttara Choudhury at uttara@proactiveinvestors.com

Follow her on Twitter@UttaraProactive 

Quick facts: NASDAQ OMX Group, Inc.

Price: 127.38 USD

NASDAQ:NDAQ
Market: NASDAQ
Market Cap: $20.92 billion
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