Nasdaq Inc.

04/24/2026 | Press release | Distributed by Public on 04/24/2026 11:04

Quarterly Report for Quarter Ending March 31, 2026 (Form 10-Q)

Management's Discussion and Analysis of
Financial Condition and Results of Operations
The following discussion and analysis of the financial
condition and results of operations of Nasdaq should be read
in conjunction with our condensed consolidated financial
statements and related notes included in this Form 10-Q.
Certain percentages and per share amounts herein may not
sum or recalculate due to rounding.
EXECUTIVE OVERVIEW
Nasdaq is a leading technology platform that powers the
world's economies. We architect the infrastructure of the
world's most modern markets, power the innovation
economy, and build trust in the financial system. We
empower economic opportunity by designing and deploying
the technology, data, and advanced analytics that enable our
clients to capture opportunities, navigate risk, and strengthen
resilience.
We manage, operate and provide our products and services in
three business segments: Capital Access Platforms, Financial
Technology and Market Services.
First Quarter 2026 Highlights and Recent Developments
•Nasdaq extended its listing leadership with 7 of the top 10
largest operating company IPOs and a 71% win rate across
eligible U.S. operating companies, direct listings and
SPAC business combinations.
•Our Index business generated net inflows of $79 billion
over the last twelve months including $6 billion in the first
quarter. ETP AUM as of March 31, 2026 was $836 billion
and average ETP AUM in the first quarter reached a new
record at $877 billion. During the quarter, Nasdaq
launched 31 new products, including 11 in the institutional
annuity space and 12 international products.
•Financial Technology delivered 20% revenue growth and
18% ARR growth.
•Market Services generated record net revenues, driven by
record volumes and strong market share across U.S. cash
equities and equity derivatives.
Macroeconomic environment
Our business performance can be positively or negatively
impacted by a number of factors, including general economic
conditions, the accelerated pace of technological change, the
geopolitical environment, current or expected inflation,
interest rate fluctuations, the threat or imposition of broad-
based tariffs, market volatility, changes in investment
patterns and priorities, regulatory changes, pandemics and
other factors that are generally beyond our control. For
example, higher overall U.S. trading volumes in the first
quarter of 2026 compared with the same period in 2025 led to
an increase in our U.S. equities options and U.S. cash
equities revenues. Market factors also contributed to higher
valuations in Nasdaq Indices and higher overall volumes in
Index derivatives. To the extent that global or national
economic conditions weaken and result in slower growth or
recessions, our business may be negatively impacted.
Nasdaq's Operating Results
The following table summarizes our financial performance
for the three months ended March 31, 2026 compared to the
same period in 2025. For a detailed discussion of our results
of operations, see "Segment Operating Results" below.
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions, except per share
amounts)
Revenues less
transaction-based
expenses
$1,407
$1,237
13.8%
Operating expenses
8.8%
Operating income
$657
$547
20.1%
Net income
$519
$395
31.4%
Diluted earnings per
share
$0.91
$0.68
33.3%
Cash dividends
declared per common
share
$0.27
$0.24
12.5%
In countries with currencies other than the U.S. dollar,
revenues and expenses are translated using monthly average
exchange rates. Impacts on our revenues less transaction-
based expenses and operating income associated with
fluctuations in foreign currency are discussed in more detail
under "Item 3. Quantitative and Qualitative Disclosures
About Market Risk."
The following chart summarizes our ARR (in millions):
* In the chart above, Other 1Q25 includes $29 million.
ARR for a given period is the current annualized value
derived from subscription contracts with a defined contract
value. This excludes contracts that are not recurring, are one-
time in nature, or where the contract value fluctuates based
on defined metrics. ARR is currently one of our key
performance metrics to assess the health and trajectory of our
recurring business. ARR does not have any standardized
definition and is therefore unlikely to be comparable to
similarly titled measures presented by other companies. ARR
should be viewed independently of revenue and deferred
revenue and is not intended to be combined with or to replace
either of those items. For AxiomSL and Calypso recurring
revenue contracts, the amount included in ARR is consistent
with the amount that we invoice the customer during the
current period. Additionally, for AxiomSL and Calypso
recurring revenue contracts that include annual values that
increase over time, we include in ARR only the annualized
value of components of the contract that are considered
active as of the date of the ARR calculation. We do not
include the future committed increases in the contract value
as of the date of the ARR calculation. ARR is not a forecast
and the active contracts at the end of a reporting period used
in calculating ARR may or may not be extended or renewed
by our customers.
The ARR chart includes:
▪
Capital Access Platforms
◦
Proprietary market data subscriptions and
annual listing fees within our Data & Listing
Services business
◦
Index data subscriptions and guaranteed
minimum on futures contracts within our Index
business
◦
Subscription contracts under our Workflow &
Insights business
▪
Financial Technology
◦
Subscription contracts excluding non-recurring
professional services.
▪
Other includes ARR related to our Solovis business
divested in October 2025.
The following chart summarizes our quarterly annualized
SaaS revenues for March 31, 2026 and 2025 (in millions):
* In the chart above, Other 1Q25 includes $29 million.
SEGMENT OPERATING RESULTS
The following table presents our revenues by segment:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Capital Access
Platforms
$565
$508
11.4%
Financial Technology
19.7%
Market Services
1,047
1,140
(8.1)%
Other revenues
(50.6)%
Total revenues
$2,137
$2,096
2.0%
Transaction rebates
(724)
(585)
23.9%
Brokerage, clearance
and exchange fees
(6)
(274)
(97.9)%
Total revenues less
transaction-based
expenses
$1,407
$1,237
13.8%
The following charts present our Capital Access Platforms,
Financial Technology and Market Services segments as a
percentage of our total revenues, less transaction-based
expenses.
Capital Access Platforms
The following tables present revenues and ARR from our
Capital Access Platforms segment:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Data & Listing
Services
$214
$192
11.4%
Index
14.4%
Workflow & Insights
6.7%
Total Capital Access
Platforms
$565
$508
11.4%
As of March 31,
2026
2025
ARR (in millions)
$1,366
$1,252
Data & Listing Services Revenues
The following tables present key drivers from our Data &
Listing Services business:
Three Months Ended March 31,
IPOs
2026
2025
The Nasdaq Stock Market
Operating company
SPACs
Exchanges that comprise Nasdaq
Nordic and Nasdaq Baltic
-
Total new listings
The Nasdaq Stock Market
Exchanges that comprise Nasdaq
Nordic and Nasdaq Baltic
As of December 31
Number of listed companies
2026
2025
The Nasdaq Stock Market
4,570
4,139
Exchanges that comprise Nasdaq
Nordic and Nasdaq Baltic
1,107
1,160
ARR (in millions)
$777
$701
In the tables above:
•The number of total listed companies on The Nasdaq Stock
Market for the three months ended March 31, 2026 and
2025 included 1,180 and 833 ETPs, respectively.
•IPOs, new listings (which includes IPOs) and total listed
companies for exchanges that comprise Nasdaq Nordic and
Nasdaq Baltic represent companies listed on the Nasdaq
Nordic and Nasdaq Baltic exchanges and companies listed
on the alternative markets of Nasdaq First North.
Data & Listing Services revenues increased in the first
quarter of 2026 compared with the same period in 2025 due
to new data sales to new and existing clients, pricing and
usage, increased annual listings revenues due to new listings,
increased initial listing fees and the favorable impact from
changes in foreign currency rates, partially offset by the
impact of prior year delistings.
Index Revenues
The following table presents key drivers from our Index
business:
As of or
Three Months Ended March 31,
2026
2025
Number of licensed ETPs
TTM change in period end ETP AUM tracking Nasdaq
indices (in billions)
Beginning balance
$622
$519
Net appreciation
Net inflows
Ending balance
$836
$622
Quarterly average ETP AUM
tracking Nasdaq indices (in
billions)
$877
$662
ARR (in millions)
$85
$79
In the table above, TTM represents trailing twelve months.
Index revenues increased in the first quarter of 2026
compared with the same period in 2025 primarily due to
higher average AUM in exchange traded products linked to
Nasdaq indices.
Workflow & Insights Revenues
The following table presents key drivers from our Workflow
& Insights business:
As of or
Three Months Ended March 31,
2026
2025
(in millions)
ARR
$504
$472
Quarterly annualized SaaS
revenues
Workflow & Insights revenues increased in the first quarter
of 2026 compared with the same period in 2025 primarily
due to an increase in analytics revenues, largely driven by
eVestment and Nasdaq Data Link sales growth.
Financial Technology
The following table presents revenues from our Financial
Technology segment:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Financial Crime
Management Technology
$93
$77
21.0%
Regulatory Technology
16.4%
Capital Markets
Technology
20.6%
Total Financial
Technology
$517
$432
19.7%
Financial Crime Management Technology Revenues
The following table presents key drivers for our Financial
Crime Management Technology business:
As of or
Three Months Ended March 31,
2026
2025
(in millions)
ARR and Quarterly annualized
SaaS revenues
$344
$295
Financial Crime Management Technology revenues
increased in the first quarter of 2026 compared with the same
period in 2025 primarily due to higher subscription revenues
from new and existing clients and higher professional
services fees.
Regulatory Technology Revenues
The following table presents key drivers for our Regulatory
Technology business:
As of or
Three Months Ended March 31,
2026
2025
(in millions)
ARR
$419
$362
Quarterly annualized SaaS
revenues
Regulatory Technology revenues increased in the first quarter
of 2026 compared with the same period in 2025 primarily
due to increased subscription revenues from our AxiomSL
and Surveillance solutions driven by new sales and price
increases to existing clients, revenue from new clients and the
favorable impact from changes in foreign currency rates.
Capital Markets Technology Revenues
The following table presents key drivers for our Capital
Markets Technology business:
As of or
Three Months Ended March 31,
2026
2025
(in millions)
ARR
$1,059
$893
Quarterly annualized SaaS
revenues
Capital Markets Technology revenues increased in the first
quarter of 2026 compared with the same period in 2025. The
increase was primarily due to higher revenues from data
center growth including a change in pricing structure, higher
Calypso upfront license revenues, increased subscription
revenues across the business and certain one-time fees,
partially offset by lower professional services revenues.
Market Services
The following table presents revenues from our Market
Services segment:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Market Services
$1,047
$1,140
(8.1)%
Transaction-based expenses:
Transaction rebates
(724)
(585)
23.9%
Brokerage,
clearance and
exchange fees
(6)
(274)
(97.9)%
Total Market Services,
net
$317
$281
12.8%
The following table presents net revenues by product from
our Market Services segment:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
U.S. Equity Derivative
Trading
$120
$108
10.7%
Cash Equity Trading
14.8%
U.S. Tape plans
1.5%
Other
30.7%
Total Market Services,
net
$317
$281
12.8%
In the table above, Other includes Nordic fixed income
trading & clearing, Nordic derivatives and Canadian cash
equities trading.
U.S. Equity Derivative Trading
The following table presents total revenues, transaction-based
expenses, and total revenues less transaction-based expenses
as well as key drivers from our U.S. Equity Derivative
Trading business:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
U.S. Equity Derivative
Trading Revenues
$432
$409
7.3%
Section 31 fees
-
(100.0)%
Transaction-based expenses:
Transaction rebates
(312)
(299)
6.4%
Section 31 fees
-
(32)
(100.0)%
Brokerage and
clearance fees
-
(2)
(79.5)%
U.S. Equity Derivative
Trading Revenues, net
$120
$108
10.7%
Section 31 fees are recorded as U.S. equity derivative and
U.S. cash equity trading revenues with a corresponding
amount recorded in transaction-based expenses. We are
assessed these fees from the SEC and pass them through to
our customers in the form of incremental fees. Pass-through
fees can increase or decrease due to rate changes by the SEC,
our percentage of the overall industry volumes processed on
our systems, and differences in actual dollar value traded.
Section 31 fees decreased in the first quarter of 2026
compared with the same period in 2025 primarily due to a
decrease in the rate to zero in the second quarter of 2025.
Since the amount recorded in revenues is equal to the amount
recorded as Section 31 fees, there is no impact on our net
revenues.
Three Months Ended March 31,
2026
2025
Total industry average daily
volume (in millions)
62.6
53.6
Nasdaq PHLX matched market
share
12.5%
9.1%
The Nasdaq Options Market
matched market share
2.6%
5.1%
Nasdaq Texas Options matched
market share
1.3%
1.7%
Nasdaq ISE Options matched
market share
6.0%
6.8%
Nasdaq GEMX Options matched
market share
3.4%
3.6%
Nasdaq MRX Options matched
market share
4.3%
2.8%
Total matched market share
executed on Nasdaq's exchanges
30.1%
29.1%
U.S. equity derivative trading revenues and U.S. equity
derivative trading revenues, net increased in the first quarter
of 2026 compared with the same period in 2025 primarily
due to higher industry trading volumes and higher overall
U.S. matched market share executed on Nasdaq's exchanges
partially offset by lower capture.
Transaction rebates, in which we credit a portion of the
execution charge to the market participant, increased in the
first quarter of 2026 compared with the same period in 2025
primarily due to higher industry trading volumes and higher
overall U.S. matched market share executed on Nasdaq's
exchanges, partially offset by lower rebate capture rate.
Cash Equity Trading Revenues
The following table presents total revenues, transaction-based
expenses, and total revenues less transaction-based expenses
as well as key drivers and other metrics from our Cash Equity
Trading business:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Cash Equity Trading
Revenues
$548
$407
34.5%
Section 31 fees
-
(100.0)%
Transaction-based
expenses:
Transaction rebates
(404)
(280)
44.4%
Section 31 fees
-
(234)
(100.0)%
Brokerage and
clearance fees
(6)
(6)
(20.3)%
Cash equity trading
revenues, net
$138
$121
14.8%
See the discussion above for an explanation of Section 31
fees for the first quarter of 2026 compared with the same
period in 2025.
Three Months Ended March 31,
Total U.S.-listed securities
2026
2025
Total industry average daily share
volume (in billions)
20.0
15.7
Matched share volume (in billions)
183.7
137.6
The Nasdaq Stock Market matched
market share
14.7%
14.2%
Nasdaq Texas matched market share
0.3%
0.3%
Nasdaq PSX matched market share
0.1%
0.1%
Total matched market share executed
on Nasdaq's exchanges
15.1%
14.6%
Market share reported to the FINRA/
Nasdaq Trade Reporting Facility
45.6%
48.1%
Total market share
60.7%
62.7%
Nasdaq Nordic and Nasdaq Baltic securities
Average daily number of equity trades
executed on Nasdaq's exchanges
797,886
789,103
Total average daily value of shares
traded (in billions)
$6.8
$5.4
Total market share executed on
Nasdaq's exchanges
74.3%
70.5%
Cash equity trading revenues and cash equity trading
revenues, net increased in the first quarter of 2026 compared
with the same period in 2025 primarily due to higher U.S.
and European industry trading volumes, and higher overall
U.S. matched market share executed on Nasdaq's exchanges.
Cash equity trading revenues, net also increased due to these
drivers but was partially offset by lower capture.
Transaction rebates, in which we credit a portion of the
execution charge to the market participant, increased in the
first quarter of 2026 compared with the same period in 2025
primarily due to higher industry trading volumes, higher
overall U.S. matched market share executed on Nasdaq's
exchanges and higher rebate capture rate. For The Nasdaq
Stock Market and Nasdaq PSX, we credit a portion of the per
share execution charge to the market participant that provides
the liquidity, and for Nasdaq Texas, we credit a portion of the
per share execution charge to the market participant that
takes the liquidity.
U.S. Tape Plans
The following table presents revenues from our U.S. Tape
plans business:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
U.S. Tape plans
$33
$33
1.5%
U.S. Tape plans revenues remained relatively flat in the first
quarter of 2026 compared with the same period in 2025.
Other
Other includes Nordic fixed income trading and clearing,
Nordic derivatives and Canadian cash equities trading. The
following table presents revenues from our Other business:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Other
$26
$19
30.7%
In the preceding table, Other is presented net of Canadian
cash equity transaction rebates of $8 million and $6 million
for the three months ended March 31, 2026 and 2025,
respectively.
Other revenues increased in the first quarter of 2026
compared with the same period in 2025 due to an increase in
Canadian cash equity revenues, Nordic fixed income
revenues and Nordic equity derivatives revenues.
Other Revenues
For the three months ended March 31, 2026 and 2025, Other
revenues related to our Nordic power futures business. For
the three months ended March 31, 2025, Other revenues also
included our Solovis business. See Note 4, "Divestitures," to
the condensed consolidated financial statements for further
discussion.
EXPENSES
Operating Expenses
The following table presents our operating expenses:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Compensation and
benefits
$356
$329
8.4%
Professional and
contract services
8.5%
Technology and
communication
infrastructure
8.0%
Occupancy
15.8%
General, administrative
and other
458.3%
Marketing and
advertising
42.2%
Depreciation and
amortization
6.0%
Regulatory
(35.7)%
Merger and strategic
initiatives
(84.7)%
Restructuring charges
103.4%
Total operating
expenses
$750
$690
8.8%
The increase in compensation and benefits expense for the
first quarter of 2026 compared with the same period in 2025
was primarily driven by increased headcount and the
unfavorable impact from changes in foreign currency rates.
Headcount, including employees of non-wholly owned
consolidated subsidiaries, increased to 9,613 employees as of
March 31, 2026 from 9,377 employees as of March 31, 2025,
as we support revenue growth and innovation.
Professional and contract services expense increased in the
first quarter of 2026 compared with the same period in 2025
primarily due to higher legal fee accruals.
Technology and communication infrastructure expense
increased in the first quarter of 2026 compared with the same
period in 2025 primarily due to increased investment in
technology, particularly our cloud initiatives and software
licensing.
Occupancy expense increased in the first quarter of 2026
compared with the same period in 2025 primarily due to
colocation data center expansion.
General, administrative and other expense increased in the
first quarter of 2026 compared with the same period in 2025
primarily due to a gain on extinguishment of debt recorded in
the first quarter of 2025.
Marketing and advertising expense increased in the first
quarter of 2026 compared with the same period in 2025
primarily due to an increase in client marketing spend.
Depreciation and amortization expense increased in the first
quarter of 2026 compared with the same period in 2025 due
to increased depreciation of capitalized software projects.
Regulatory expense decreased in the first quarter of 2026
compared with the same period in 2025 primarily due to
lower CAT operating costs.
We have pursued various strategic initiatives and completed
acquisitions and divestitures in recent years, which have
resulted in expenses which would not have otherwise been
incurred. These expenses generally include integration costs,
as well as legal, due diligence and other third-party
transaction costs and vary based on the size and frequency of
the activities described above. For the three months ended
March 31, 2026, these costs included amounts associated
with various strategic initiative costs. For the three months
ended March 31, 2025, these costs included amounts
associated with the transfer of open positions in our Nordic
power derivatives trading and clearing business, Adenza
integration costs and other strategic initiative costs.
Restructuring charges increased in the first quarter of 2026
compared with the same period in 2025 primarily due to the
higher consulting and other services in relation to our Adenza
restructuring program. We initiated the program upon the
acquisition of Adenza and further expanded the program in
the fourth quarter of 2024 following the achievement of our
initial targets. In connection with this program, we expect to
incur approximately $140 million in pre-tax charges. We
have incurred costs principally related to employee-related
costs, contract terminations, asset impairments and other
related costs and expect to incur additional costs in these
areas in an effort to accelerate efficiencies through location
strategy and enhanced AI capabilities. Actions taken as part
of this program were completed as of December 31, 2025,
while certain costs are being recognized in the first half of
2026. We have achieved benefits primarily in the form of
expense synergies with over $160 million net expense
synergies actioned through March 31, 2026. See Note 19,
"Restructuring Charges," to the condensed consolidated
financial statements for further discussion.
Non-Operating Income and Expenses
The following table presents our non-operating income and
expenses:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Interest income
$6
$11
(48.5)%
Interest expense
(87)
(96)
(10.1)%
Net interest expense
(81)
(85)
(5.1)%
Net gain on
divestitures
-
100.0%
Other losses
(14)
(1)
NM
Net income from
unconsolidated
investees
(3.2)%
Total non-operating
income (expense)
$20
$(59)
(134.2)%
________
NM Not meaningful
The following table presents our interest expense:
Three Months Ended March 31,
Percentage
Change
2026
2025
(in millions)
Interest expense on debt
$84
$92
(10.0)%
Accretion of debt
issuance costs and debt
discount
(13.8)%
Other fees
(10.0)%
Interest expense
$87
$96
(10.1)%
Interest income decreased for the first quarter of 2026
compared with the same period in 2025 primarily due to a
lower average cash balance.
Interest expense decreased for the first quarter of 2026
compared with the same period in 2025 primarily due to
lower outstanding debt following the repayment of our 2025
Notes and the partial repurchases of several series of
outstanding senior unsecured notes in 2025.
Net gains on divestitures for the three months ended March
31, 2026 primarily relates to the divestiture of our Nordic
power futures business. See Note 4, "Divestitures," to the
condensed consolidated financial statements for further
discussion of these transactions.
Other losses primarily represents realized and unrealized
gains and losses from strategic investments related to our
corporate venture program. See "Equity Securities," of Note
6, "Investments," to the condensed consolidated financial
statements for further discussion of these transactions.
Net income from unconsolidated investees primarily relates
to income recognized from our equity method investment in
OCC. See "Equity Method Investments," of Note 6,
"Investments," to the condensed consolidated financial
statements for further discussion.
Tax Matters
The following table presents our income tax provision and
effective tax rate:
Three Months Ended March 31,
Percentage
Change
2026
2025
($ in millions)
Income tax provision
$158
$93
69.6%
Effective tax rate
23.4%
19.1%
For further discussion of our tax matters, see Note 16,
"Income Taxes," to the condensed consolidated financial
statements.
NON-GAAP FINANCIAL MEASURES
In addition to disclosing results determined in accordance
with U.S. GAAP, we also provide non-GAAP net income
and non-GAAP diluted earnings per share in this Quarterly
Report on Form 10-Q. Management uses this non-GAAP
information internally, along with U.S. GAAP information,
in evaluating our performance and in making financial and
operational decisions. We believe our presentation of these
measures provides investors with greater transparency and
supplemental data relating to our financial condition and
results of operations. In addition, we believe the presentation
of these measures is useful to investors for period-to-period
comparisons of our ongoing operating performance.
These measures are not in accordance with, or an alternative
to, U.S. GAAP, and may be different from non-GAAP
measures used by other companies. In addition, other
companies, including companies in our industry, may
calculate such measures differently, which reduces their
usefulness as comparative measures. Investors should not
rely on any single financial measure when evaluating our
business. This non-GAAP information should be considered
as supplemental in nature and is not meant as a substitute for
our operating results in accordance with U.S. GAAP. We
recommend investors review the U.S. GAAP financial
measures included in this Quarterly Report on Form 10-Q,
including our condensed consolidated financial statements
and the notes thereto. When viewed in conjunction with our
U.S. GAAP results and the accompanying reconciliation, we
believe these non-GAAP measures provide greater
transparency and a more complete understanding of factors
affecting our business than U.S. GAAP measures alone.
We understand that analysts and investors regularly rely on
non-GAAP financial measures, such as non-GAAP net
income and non-GAAP diluted earnings per share, to assess
operating performance. We use non-GAAP net income and
non-GAAP diluted earnings per share because they highlight
trends more clearly in our business that may not otherwise be
apparent when relying solely on U.S. GAAP financial
measures, since these measures eliminate from our results
specific financial items that have less bearing on our ongoing
operating performance.
The following table presents reconciliations between U.S.
GAAP net income and diluted earnings per share and non-
GAAP net income and diluted earnings per share:
Three Months Ended March 31,
2026
2025
(in millions, except per share
amounts)
U.S. GAAP net income
$519
$395
Non-GAAP adjustments:
Amortization expense of acquired
intangible assets
Merger and strategic initiatives
expense
Restructuring charges
Gain on extinguishment of debt
-
(19)
Net gain on divestitures
(89)
-
Net income from unconsolidated
investees
(26)
(27)
Legal and regulatory matters
Other loss
Total non-GAAP adjustments
$42
$108
Total non-GAAP tax
adjustments
(12)
(28)
Other tax adjustments
-
(19)
Total non-GAAP adjustments,
net of tax
$30
$61
Non-GAAP net income
$549
$456
U.S. GAAP effective tax rate
23.4%
19.1%
Total adjustments from non-
GAAP tax rate
0.3%
4.4%
Non-GAAP effective tax rate
23.7%
23.5%
Weighted-average common shares
outstanding for diluted earnings
per share
571.7
580.0
U.S. GAAP diluted earnings per
share
$0.91
$0.68
Total adjustments from non-
GAAP net income
0.05
0.11
Non-GAAP diluted earnings per
share
$0.96
$0.79
We believe that excluding the above items, described further
below, from the non-GAAP net income provides a more
meaningful analysis of Nasdaq's ongoing operating
performance and comparisons in Nasdaq's performance
between periods:
•Amortization expense of acquired intangible assets: We
amortize intangible assets acquired in connection with
various acquisitions. Intangible asset amortization expense
can vary from period to period due to episodic acquisitions
completed, rather than from our ongoing business
operations. As such, if intangible asset amortization is
included in performance measures, it is more difficult to
assess the day-to-day operating performance of the
businesses and the relative operating performance of the
businesses between periods.
•Merger and strategic initiatives expense: We have pursued
various strategic initiatives and completed acquisitions and
divestitures in recent years that have resulted in expenses
which would not have otherwise been incurred. The
frequency and the amount of such expenses vary
significantly based on the size, timing and complexity of
the transactions. These expenses primarily include
integration costs, as well as legal, due diligence and other
third-party transaction costs. For the three months ended
March 31, 2026, these costs included amounts associated
with various strategic initiative costs. For the three months
ended March 31, 2025, these costs included amounts
associated with the transfer of open positions in our Nordic
power derivatives trading and clearing business, Adenza
integration costs and other strategic initiative costs.
•Restructuring charges: In the fourth quarter of 2023,
following the closing of the Adenza acquisition, our
management approved, committed to and initiated a
restructuring program, to optimize our efficiencies as a
combined organization. We initiated the program upon the
acquisition of Adenza and further expanded the program in
the fourth quarter of 2024 following the achievement of
our initial targets. Actions taken as part of this program
were completed as of December 31, 2025, while certain
costs are being recognized in the first half of 2026. See
Note 19, "Restructuring Charges," to the condensed
consolidated financial statements for further discussion of
this program.
•Gain on extinguishment of debt: For the three months
ended March 31, 2025, this included a gain on
extinguishment of debt, which is recorded under general,
administrative and other expense in the Condensed
Consolidated Statements of Income.
•Net gain on divestitures: For the three months ended
March 31, 2026, this primarily includes the recognition of
an incremental gain on the sale of our Nordic power
futures business, net of costs to sell. See Note 4,
"Divestitures," to the condensed consolidated financial
statements for further discussion of this transaction.
•Net income from unconsolidated investees: We exclude our
share of the earnings and losses of our equity method
investments. This provides a more meaningful analysis of
Nasdaq's ongoing operating performance or comparisons
in Nasdaq's performance between periods. See "Equity
Method Investments," of Note 6, "Investments," to the
condensed consolidated financial statements for further
discussion.
•Legal and regulatory matters: For the three months ended
March 31, 2026 and 2025, this includes accruals relating to
certain legal matters, which are recorded in professional
and contract services in the Condensed Consolidated
Statements of Income.
•Other loss: For the three months ended March 31, 2026
and 2025, other items primarily include net gains and
losses from strategic investments entered into through our
corporate venture program, which are included in other
losses in our Condensed Consolidated Statements of
Income.
•Total non-GAAP tax adjustments: The non-GAAP
adjustment to the income tax provision for all periods
primarily includes the tax impact of each non-GAAP
adjustment.
•Other tax adjustments: For the three months ended March
31, 2025, other tax adjustments included the release of the
prior years' reserves following a favorable audit settlement.
LIQUIDITY AND CAPITAL RESOURCES
Historically, we have funded our operating activities and met
our commitments through cash generated by operations,
augmented by the periodic issuance of debt. Currently, our
cost and availability of funding remain healthy. We continue
to prudently assess our capital deployment strategy through
balancing internal investments, debt repayments, and
shareholder return activity, including dividends and share
repurchases, and potential acquisitions.
We expect that our current cash and cash equivalents
combined with cash flows provided by operating activities,
supplemented with our borrowing capacity and access to
additional financing, including our revolving credit facility
and our commercial paper program, provides us additional
flexibility to meet our ongoing obligations and the capital
deployment strategic actions described above, while allowing
us to invest in activities and product development that
support the long-term growth of our operations.
Principal factors that could affect the availability of our
internally-generated funds include:
•deterioration of our revenues in any of our business
segments;
•changes in regulatory and working capital requirements;
and
•an increase in our expenses.
Principal factors that could affect our ability to obtain cash
from external sources include:
•operating covenants contained in our credit facilities that
limit our total borrowing capacity;
•credit rating downgrades, which could limit our access to
additional debt;
•a significant decrease in the market price of our common
stock; and
•volatility or disruption in the public debt and equity
markets.
The following table summarizes selected measures of our
liquidity and capital resources:
March 31, 2026
December 31, 2025
(in millions)
Working capital
$(17)
$42
Cash and cash equivalents
Financial investments
Working Capital
The decrease in working capital from December 31, 2025 to
March 31, 2026, excluding default funds and margin
deposits, which are both equal and offsetting, is primarily due
to a decrease in current assets and an increase in current
liabilities.
Decreased current assets were primarily due to:
•lower restricted cash primarily due to the movement of
regulatory capital to longer term investments classified as
financial investments,
•lower cash and cash equivalents; partially offset by
•an increase in financial investments at fair value,
•an increase in receivables, net due to timing of billings, and
•an increase in other current assets.
Increased current liabilities were primarily due to:
•Higher deferred revenue due to timing of billings,
primarily relating to our annual listing fees; partially offset
by
•a decrease in accrued personnel costs,
•a decrease in other current liabilities, and
•a decrease in accounts payable and accrued expenses.
Cash and Cash Equivalents
Cash and cash equivalents includes all non-restricted cash in
banks and highly liquid investments with original maturities
of 90 days or less at the time of purchase. The balance
retained in cash and cash equivalents is a function of
anticipated or possible short-term cash needs, prevailing
interest rates, our investment policy, and alternative
investment choices. As of March 31, 2026 and December 31,
2025, our cash and cash equivalents of $515 million were
primarily invested in money market funds, bank deposits,
European government debt securities, and municipal notes.
Repatriation of Cash
Our cash and cash equivalents held outside of the U.S. in
various foreign subsidiaries totaled $335 million as of March
31, 2026 and $280 million as of December 31, 2025. The
remaining balance held in the U.S. totaled $180 million as of
March 31, 2026 and $324 million as of December 31, 2025.
Restricted Cash and Cash Equivalents
Restricted cash and cash equivalents, which was $49 million
as of March 31, 2026 and $210 million as of December 31,
2025, is restricted from withdrawal due to a contractual or
regulatory requirement or not available for general use and as
such is classified as restricted in the Condensed Consolidated
Balance Sheets. The decrease in this balance as of March 31,
2026 is primarily due to more regulatory capital being
invested in longer term investments, which are classified as
financial investments in the Condensed Consolidated Balance
Sheets as of March 31, 2026. Capital held for regulatory
purposes is invested based on prevailing market rates and our
investment strategy and may be held in shorter term
investments, which meet the criteria to be classified as cash
equivalents, and would then be included in restricted cash
and cash equivalents or longer term investments which would
be classified as financial investments in the Condensed
Consolidated Balance Sheets.
Cash Flow Analysis
The following table summarizes the changes in cash flows:
Three Months Ended March 31,
2026
2025
Net cash provided by (used in):
(in millions)
Operating activities
$689
$663
Investing activities
(258)
Financing activities
(4,184)
(1,083)
Net Cash Provided by Operating Activities
Net cash provided by operating activities primarily consists
of net income adjusted for certain non-cash items, including,
but not limited to, depreciation and amortization expense,
expense associated with share-based compensation, net
income from unconsolidated investees, net gain on
divestitures and the effects of changes in working capital.
Refer to the above discussion regarding changes in working
capital.
Net cash provided by operating activities increased $26
million in the first quarter of 2026 compared with the same
period in 2025. The increase was primarily driven by an
increase in net income, partially offset by changes in working
capital, as discussed above, and a decrease in adjustments to
net income primarily driven by net gain on divestitures.
Net Cash Provided by (Used in) Investing Activities
Net cash provided by (used in) investing activities increased
in the first quarter of 2026 compared with the same period in
2025. This was primarily driven by higher proceeds from net
sales and redemption of investments related to default funds
and margin deposits of $1,180 million, partially offset by
purchases of securities, net of $158 million, primarily due to
more regulatory capital being invested in longer term
investments, purchases of property and equipment of $11
million and other investing activities of $6 million primarily
related to our corporate venture program. The movement in
our default funds and margin deposits has no impact on
Nasdaq's cash, cash equivalents, restricted cash or restricted
cash equivalents as it is held on behalf of our customers.
Net Cash Used in Financing Activities
Net cash used in financing activities increased in the first
quarter of 2026 compared with the same period in 2025
primarily driven by an increase in default funds and margin
deposits of $2,918 million, which does not impact Nasdaq's
cash, cash equivalents, restricted cash or restricted cash
equivalents as it relates to customer funds, increases in
repurchases of common stock of $433 million and an
increase in dividends paid of $15 million. These increases
were partially offset by a decrease in repayment of debt of
$257 million.
See "Default Fund Contributions and Margin Deposits" of
Note 14, "Clearing Operations," for further discussion of
these balances.
See "Share Repurchase Program," and "Cash Dividends on
Common Stock," of Note 11, "Nasdaq Stockholders'
Equity," to the condensed consolidated financial statements
for further discussion of our share repurchase program and
cash dividends declared and paid on our common stock.
Financial Investments
Our financial investments totaled $184 million as of March
31, 2026 and $28 million as of December 31, 2025. Of these
securities, $168 million as of March 31, 2026 and $18
million as of December 31, 2025 are assets primarily utilized
to meet regulatory capital requirements, mainly for our
clearing operations at Nasdaq Clearing. See Restricted Cash
and Cash Equivalents above and Note 6, "Investments," to
the condensed consolidated financial statements for further
discussion.
Regulatory Capital Requirements
Clearing Operations Regulatory Capital Requirements
We are required to maintain minimum levels of regulatory
capital for the clearing operations of Nasdaq Clearing. The
level of regulatory capital required to be maintained is
dependent upon many factors, including market conditions
and creditworthiness of the counterparty. As of March 31,
2026, our required regulatory capital of $154 million was
primarily comprised of European government debt securities
that are included in financial investments in the Condensed
Consolidated Balance Sheets.
Broker-Dealer Net Capital Requirements
Our broker-dealer subsidiaries, Nasdaq Execution Services,
NFSTX, LLC, and Nasdaq Capital Markets Advisory, are
subject to regulatory requirements intended to ensure their
general financial soundness and liquidity. These requirements
obligate these subsidiaries to comply with minimum net
capital requirements. As of March 31, 2026, the combined
required minimum net capital totaled $1 million and the
combined excess capital totaled $20 million, substantially all
of which is held in cash and cash equivalents in the
Condensed Consolidated Balance Sheets. The required
minimum net capital is included in restricted cash and cash
equivalents in the Condensed Consolidated Balance Sheets.
Nordic and Baltic Exchange Regulatory Capital
Requirements
The entities that operate trading venues in the Nordic and
Baltic countries are each subject to local regulations and are
required to maintain regulatory capital intended to ensure
their general financial soundness and liquidity. As of March
31, 2026, our required regulatory capital of $46 million was
primarily invested in cash and cash equivalents, which is
included in restricted cash and cash equivalents in the
Condensed Consolidated Balance Sheets and European
government debt securities that are included in financial
investments in the Condensed Consolidated Balance Sheets.
Other Capital Requirements
We operate several other businesses which are subject to
local regulation and are required to maintain certain levels of
regulatory capital. As of March 31, 2026, other required
regulatory capital of $14 million, primarily related to Nasdaq
Central Securities Depository, was primarily invested in
European government debt securities that are included in
financial investments in the Condensed Consolidated Balance
Sheets and cash and cash equivalents, which is included in
restricted cash and cash equivalents in the Condensed
Consolidated Balance Sheets.
Equity and dividends
Share Repurchase Program
See "Share Repurchase Program," of Note 11, "Nasdaq
Stockholders' Equity," to the condensed consolidated
financial statements for further discussion of our share
repurchase program, including our ASR agreement.
Cash Dividends on Common Stock
The following table presents our quarterly cash dividends
paid per common share on our outstanding common stock:
2026
2025
First quarter
$0.27
$0.24
See "Cash Dividends on Common Stock," of Note 11,
"Nasdaq Stockholders' Equity," to the condensed
consolidated financial statements for further discussion of the
dividends.
Debt Obligations
Our outstanding debt obligations, by contractual maturity, at March 31, 2026 are as follows (in U.S. Dollar millions):
n U.S. Notes n Euro Notes
As of and for the three months ended March 31, 2026, the
weighted average interest rate on our debt obligations was
approximately 3.7%. This rate can fluctuate based on changes
in foreign currency exchange rates and changes in the amount
and duration of outstanding debt. See "Foreign Currency
Exchange Rate Risk" below for further discussion on
hedging associated with our Euro Notes. In addition to the
2022 Revolving Credit Facility, we also have other credit
facilities primarily to support our Nasdaq Clearing operations
in Europe, as well as to provide a cash pool credit line. These
European credit facilities, which are available in multiple
currencies, totaled $202 million as of March 31, 2026 and
$208 million as of December 31, 2025 in available liquidity,
none of which was utilized.
As of March 31, 2026, we were in compliance with the
covenants of all of our debt obligations.
See Note 8, "Debt Obligations," to the condensed
consolidated financial statements for further discussion of our
debt obligations.
Contractual Obligations and Contingent Commitments
Nasdaq had no significant changes to our contractual
obligations and contingent commitments from those
disclosed in "Part I. Item 7. Management's Discussion and
Analysis of Financial Condition and Results of Operations"
in our Annual Report Form 10-K that was filed with the SEC
February 12, 2026.
OFF-BALANCE SHEET ARRANGEMENTS
For discussion of off-balance sheet arrangements see:
•Note 14, "Clearing Operations," to the condensed
consolidated financial statements for further discussion of
our non-cash default fund contributions and margin
deposits received for clearing operations; and
•Note 17, "Commitments, Contingencies and Guarantees,"
to the condensed consolidated financial statements for
further discussion of:
◦Guarantees issued and credit facilities available;
◦Other guarantees; and
◦Routing brokerage activities.
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