Nasdaq Earnings Fall, But Revenue Rises on Acquisitions
October 26 2016 - 9:40AM
Dow Jones News
Nasdaq Inc. said its quarterly profit declined, hurt by lower
volatility and trading volumes, while acquisitions helped spur an
increase in revenue.
The company's earnings dropped to $131 million, or 77 cents a
share, down from $138 million, or 80 cents a share, a year earlier.
Excluding restructuring- and acquisition-related charges and other
items, per-share earnings rose to 91 cents.
Revenue increased to 11% to $585 million. Analysts polled by
Thomson Reuters expected a per-share profit of 90 cents on revenue
of $586.2 million.
Nasdaq has transformed from a U.S.-focused exchange operator to
a global business-services company that includes markets in the
U.S., Canada and the Nordic region, as well as investor, public
relations, technology and data services.
This year it closed deals to buy Chi-X Canada, an alternative
trading system for the Toronto Stock Exchange, and news release
distributor Marketwired. The financial terms of those deals weren't
disclosed. In May it bought board portal systems provider
Boardvantage for $200 million and in June it bought
options-exchange operator International Securities Exchange for
$1.1 billion.
Acquisitions added $58 million to revenue in the quarter.
Chief Executive Bob Greifeld said the quarter showed how the
company's varied businesses allowed it to adapt to changing market
conditions. While lower volatility and trading volumes hurt results
in its marketplace segments, its non-trading units had growth.
Last summer, markets were affected by large swings in the
Chinese stock market. Exchanges benefit more from periods of
heightened trading and volatility because the more people trade,
the more fees exchanges collect on transactions.
Market services revenue, which contributed 36% of the exchange's
top line, increased 6.5% on acquisitions, partially offset by lower
volumes.
The company's technology solutions segment, which includes
exchange technology for operators around the world and compliance
surveillance software, posted 28% growth on the deals as well as
increased software licensing and support fees and surveillance.
The company's information-services segment, which represented
23% of the top line and provides data and indexes to clients,
reported a revenue increase of 3.8% due to acquisitions and growth
in proprietary data products, partially offset by declines in
indexes due to lower volumes.
Listing services revenue increased 3% due to more Nordic
listings.
Write to Austen Hufford at austen.hufford@wsj.com
(END) Dow Jones Newswires
October 26, 2016 09:25 ET (13:25 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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