Exchange operator Nasdaq beat Wall Street expectations for third-quarter profit on Tuesday, as persistent volatility boosted trading volumes while robust demand lifted its regulatory and fraud management solutions businesses.
Traders actively shuffled their portfolios to navigate the Trump administration’s uncertain trade policies and growth concerns, boosting volumes for the exchange’s U.S. equity options contracts, as well as cash equities.
The company’s market services revenue from trading climbed 14 per cent to US$303 million.
AI-fueled corporate earnings and lower rates also powered U.S. indices to record highs during the quarter.
The company reported an adjusted profit of $511 million, or 88 cents per share, for the three months ended September 30. Analysts on average had expected a profit of 85 cents per share, according to data compiled by LSEG.
Shares of the company rose one per cent in premarket trading.
Nasdaq also saw broad-based growth across its financial technology and software divisions, reflecting the company’s strategic pivot to generate more predictable, recurring revenue that is less sensitive to market volatility.
Revenue from its financial technology unit, which includes anti-financial crime and regulatory software, jumped 23.2 per cent to $457 million in the third quarter, while its index business revenue rose 13.2 per cent to $206 million.
“Nasdaq achieved significant milestones in the third quarter, with Solutions quarterly revenue surpassing $1 billion and annual recurring revenues reaching $3 billion for the first time,” CEO Adena Friedman said in a statement.
The quarter also saw a triumphant return of initial public offerings to U.S. exchanges, marking a striking turnaround from April when Trump’s duties put the brakes on many listing plans.
U.S. IPO volumes clocked their best first nine months of the year since 2021, according to data from Dealogic.
Space-tech firm Firefly Aerospace FLY.O and blockchain lender Figure FIGR.O were among the notable debuts on Nasdaq during the period.
Nasdaq’s net revenue rose 15 per cent to $1.32 billion.
(Reporting by Ateev Bhandari in Bengaluru; Editing by Sriraj Kalluvila)