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    NDAQ
    Earnings call· Jun 2026(Q2 FY26)

    NASDAQ, INC. NDAQ

    Jul 23, 2026 Source

    Executive summary

    Nasdaq Q2 FY26 — Record AUM, Strong IPO Environment, and AI-Driven Growth

    Nasdaq delivered strong Q2 FY26 results, driven by robust solutions revenue growth and record milestones in its Index and Verafin businesses. The company is actively leveraging AI to enhance product capabilities and drive client engagement, while navigating an evolving market structure and a strengthening IPO environment. Management remains confident in its strategic objectives for long-term value creation.

    Highlights

    5

    • Net revenue increased 15% to $1.5 billion, with solutions revenue up 17% to $1.2 billion.

    • Diluted EPS grew 25% to $1.07, marking the first time exceeding $1 in quarterly EPS.

    • Overall annualized recurring revenue (ARR) grew 12% year-over-year to $3.3 billion.

    • The Index business's ETP AUM surpassed $1 trillion for the first time, driven by record net inflows of $51 billion in Q2 and $109 billion over the last 12 months.

    • Financial Crime Management technology (Verafin) revenue grew 22%, and Market Services net revenue grew 11% to $340 million, supported by record volumes.

    Concerns

    5

    • Corporate Solutions revenue remained essentially flat during the quarter.

    • Performance in Capital Markets Technology was partially offset by lower professional services revenue.

    • Lower capture in U.S. options was observed, driven by a continued mix shift in order flow composition.

    • The company anticipates tougher year-over-year expense comparisons in Q3 and Q4 2026 due to a $5 million regulatory fine in Q3 2025 and Calypso upfront revenue in 2025.

    • Non-GAAP expense guidance for FY26 was raised to a range of $2.530 billion to $2.570 billion, from $2.485 billion to $2.545 billion.

    Guidance & targets

    4
    CategoryTargetConfidence
    Non-GAAP Operating Expense
    $2.530 billion to $2.570 billion
    high materiality
    High
    Non-GAAP Tax Rate
    22.5% to 24.5%
    medium materiality
    High
    23/5 Trading Launch
    Projected launch on December 6, 2026
    medium materiality
    High
    Event Options Launch
    On track for launch in the fourth quarter
    medium materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Capital Access Platforms
    Delivered strong revenue and ARR growth, with data and listings, and index businesses performing well. Workflow and Insights also contributed positively. Operating margin expanded by 4 percentage points year-over-year.
    ARR Growth: 8%Data and listings revenue growth: 9%Data and listings ARR growth: 9%Index net revenue growth: 35%Index ARR growth: 8%Workflow and Insights revenue growth: 5%Workflow and Insights ARR growth: 6%US listings operating company proceeds raised (H1): $111 billionSpaceX IPO proceeds: $86 billionNew operating companies welcomed (Q2): 26Proceeds raised by new operating companies (Q2): $106 billionSK Hynix ADR listing proceeds: $27 billionEnterprise licenses (data business) YoY increase: 34%Index net inflows (Q2): $51 billionIndex net inflows (LTM): $109 billionETP AUM: >$1 trillionDerivatives contract volumes (Q2): 33% growtheVestment new bookings associated with AI use cases: >25%eVestment private funds: ~91,000Boardvantage users leveraging AI tools: 65%IR Insight clients leveraging AI tools: 79%
    		$621 million18%—63%
    Financial Technology
    Achieved outstanding revenue and ARR growth, with double-digit growth across all three subdivisions. Strong client engagement and new client signings, cross-sells, and upsells. Operating margin was in line with the prior year period.
    ARR Growth: 16%Financial Crime Management technology revenue growth: 22%Financial Crime Management technology ARR growth: 17%Financial Crime Management technology net revenue retention: 110%Financial Crime Management clients: >2,800Financial Crime Management collective assets served: >$13 trillionFinancial Crime Management new SMB clients (Q2): 47Verafin agentic AI workforce users: 750Regulatory technology revenue growth: 13%Regulatory technology ARR growth: 14%Capital Markets Technology revenue growth: 14%Capital Markets Technology ARR growth: 17%New clients signed (Q2): 58Cross-sells (Q2): 7Upsells (Q2): 107Calypso countries of operation: >70
    		$539 million15%—46%
    Market Services
    Delivered record quarterly net revenue, driven by record industry volumes in U.S. equities and U.S. options. Index options revenue more than doubled year-over-year for the fourth consecutive quarter. Operating margin increased by 1 percentage point year-over-year.
    European cash equities Lit market share: 0.74 (up 3 percentage points)Triple witch event notional value traded (June 18): $296 billionU.S. equity industry volumes (June 18): 34.6 billion sharesRussell Reconstitution notional value traded (June 26): $334 billionRussell Reconstitution share volume in cross: 4.6 billion shares
    		$340 million11%—64%

    Operational metrics

    19
    Net Revenue
    $1.5 billionup 15%
    Q2 FY26

    Overall company net revenue.

    Solutions Revenue
    $1.2 billionup 17%
    Q2 FY26

    Revenue from solutions businesses.

    Overall Annualized Recurring Revenue (ARR)
    $3.3 billionup 12% year-over-year
    Q2 FY26

    Company-wide annualized recurring revenue.

    Operating Expense
    $641 millionup 10%
    Q2 FY26

    Total operating expenses.

    Operating Margin
    57%up 2 percentage points
    Q2 FY26

    Company-wide operating margin compared to prior year period.

    EBITDA Margin
    60%up 2 percentage points
    Q2 FY26

    Company-wide EBITDA margin compared to prior year period.

    Net Income
    $605 million
    Q2 FY26

    Company-wide net income.

    Diluted EPS
    $1.07up 25%
    Q2 FY26

    Diluted earnings per share, exceeding $1 for the first time.

    Dividend Per Share
    $0.31
    Q2 FY26

    Dividend paid per share.

    Annualized Payout Ratio
    31%
    Q2 FY26

    Annualized payout ratio based on Q2 dividend.

    Shares Repurchased
    $356 million
    Q2 FY26

    Value of common stock repurchased in the quarter.

    Shares Repurchased (H1)
    $903 millionvs $616 million in all of 2025
    H1 FY26

    Total shares repurchased in the first half of the year, significantly higher than the full year 2025.

    Variable Accelerated Share Repurchase Plan
    $200 million to $250 million
    Q3 FY26

    New share repurchase plan launched in July.

    Gross Leverage Ratio
    2.6x
    Q2 FY26

    Driven by EBITDA growth and net repayment of approximately $162 million of cost debt.

    Alpha (Revenue Growth Driver)
    11 percentage points
    Q2 FY26

    Contribution to net revenue growth, second consecutive quarter of double-digit alpha growth.

    Data Factories (Revenue Growth Driver)
    4 percentage points
    Q2 FY26

    Contribution to net revenue growth, driven by higher valuations in NASDAQ indices and higher derivative volumes.

    New Products Launched (Index)
    34
    Q2 FY26

    Number of new products introduced in the Index business.

    New Products Launched Outside US (Index)
    51%
    Q2 FY26

    Percentage of new Index products launched outside the United States.

    Verafin Agentic AI Workforce Users
    750
    Q2 FY26

    Number of clients using Verafin's agentic AI workforce.

    Product announcements

    8
    ProductTypeDetails
    Data Link Model Context Protocol (MCP)launch
    Verafin Agentic Workers (AML structuring alerts, ACH fraud alert triage)expansion
    Verafin Auto Dispositioning Capabilitiesroadmap
    Verafin Flexible Deployment Optionsroadmap
    Eqlipse Product Suitemilestone
    Calypso Platformexpansion
    23/5 Tradingroadmap
    Event Optionslaunch

    Deals & partnerships

    4
    Nasdaq Private MarketAgreement to sell Nasdaq Fund Secondaries to Nasdaq Private Market, where Nasdaq remains an investor and strategic partner.

    This transaction brings together two highly complementary businesses and strongly positions Nasdaq Private Market to capitalize on the significant opportunity to provide secondary liquidity infrastructure for both private company shares and private fund interests.

    DassetiAgreement to acquire Dasseti, an AI-powered due diligence platform used by institutional asset allocators and managers.

    Dasseti will be integrated into Nasdaq eVestment to provide a seamless experience across eVestment's institutional network.

    Canton network, two leading asset managersPiloted tokenized collateral trades on the Canton network in July alongside two of the world's leading asset managers.

    Specifically, tokenized money market funds were successfully transmitted as collateral through Calypso, leveraging the Canton network. This was a proof of concept to demonstrate Calypso's ability to facilitate the movement of tokenized collateral.

    Georgian Financial Markets Treasury AssociationDeal to modernize and increase treasury and financial markets infrastructure in Georgia.

    As part of this deal, five leading commercial banks in the country of Georgia will adopt the Calypso platform, with opportunities to onboard more banks over time. Calypso now operates in more than 70 countries.

    Risks & headwinds

    9
    Corporate Solutions challenging environmentQ2 FY26

    Revenue was essentially flat

    Lower professional services revenueQ2 FY26

    Partially offset strong performance

    Tougher comps for Capital Markets TechnologyQ3 and Q4 2026

    Tougher comp

    Mix shift in derivatives volumesQ2 FY26

    From higher priced M&A contracts to lower-priced micro e-mini contracts

    Lower capture in U.S. optionsQ2 FY26

    Lower capture

    Lower U.S. state client revenueQ2 FY26

    Primarily driven by lower audit revenue

    Regulatory fine in Q3 2025Q3 2025

    $5 million

    Mitigation: Will create a tougher expense comparison in coming quarters.

    Slow sales cycles for Verafin outside U.S.

    Sales cycles are slow

    Mitigation: Continued engagement with key clients and demonstration of solution efficacy.

    AI-driven financial crime

    Deepfakes and more sophisticated criminal behavior

    Mitigation: Leveraging Gen AI to look through data in new ways, capture different signals, and identify new patterns across the consortium data lake. Cross-asset class capability in SMARTS uses signals-based detection.

    What to watch in Q3 FY26

    5

    Variable accelerated share repurchase plan completion

    Q3
    CurrentLaunched in July, $200M-$250M
    TargetCompletion of the plan

    Why it matters

    Indicates continued capital return to shareholders and management's confidence.

    In July, we launched a $200 million to $250 million variable accelerated share repurchase plan, which will be completed in the third quarter.

    Q&A highlights

    6

    How has Nasdaq's thinking evolved on monetizing AI? Is it primarily for sales momentum/retention/pricing power, or separate charges? What is the mid-term monetization vision?

    Monetization is product-by-product. Some AI capabilities are integrated into core products, with pricing evaluated over time. Others are offered as new modules with a freemium model, such as Verafin's digital workers and surveillance's Gen AI News Copilot. Clients are signing up for upsells, and AI-ready data also drives demand for data assets. Nasdaq is in the early innings of monetization but encouraged by client adoption.

    “we're in the very early innings of monetizing our AI capabilities, but we're very encouraged by the way that the clients are moving from free to a paid subscription.”

    asked by Ashish Sabadra · answered by Adena Friedman

    3 min read7 chapters

    Detailed Narrative

    01

    AI Innovation and Monetization Strategy

    Nasdaq is actively integrating AI capabilities across its product suite, adopting a product-by-product monetization approach. This includes embedding AI into core offerings like Calibration Copilot and Boardvantage, while also introducing new modules with a freemium model, such as Verafin's digital workers and surveillance's Gen AI News Copilot. Clients are demonstrating strong adoption and a willingness to convert to paid subscriptions, driven by the significant efficiency gains, with some tools saving up to 80% of their time. The company is also leveraging AI to enhance its data offerings, making its investment and Data Link data 'AI ready' to drive increased demand.

    02

    Robust IPO Environment and Listings Performance

    The U.S. listings franchise achieved its strongest first half in U.S. exchange history, facilitating $111 billion in operating company proceeds. The second quarter alone saw landmark listings, including SpaceX's $86 billion IPO (the largest ever) and SK Hynix's $27 billion ADR listing. Management noted a broadening IPO pipeline, extending beyond megadeals to include companies in AI infrastructure, healthcare, biotech, defense, and consumer sectors, indicating a healthy and diverse market for new listings.

    03

    Record Performance in Index Business

    Nasdaq's Index franchise reached new milestones, with its Exchange Traded Product (ETP) Assets Under Management (AUM) surpassing $1 trillion for the first time. This was fueled by record net inflows of $51 billion in Q2 and $109 billion over the last 12 months. Product innovation is a key driver, with 38% of trailing 12-month net inflows attributed to products launched in the past five years. The company also expanded its global reach, with 51% of new products introduced in Q2 launched outside the United States.

    04

    Financial Technology Momentum and Verafin's Growth

    The Financial Technology division delivered strong results with 15% revenue growth and 16% ARR growth, driven by high client engagement for solutions addressing market modernization, always-on trading, and regulatory compliance. Financial Crime Management technology, particularly Nasdaq Verafin, saw 22% revenue growth, expanding its client base to over 2,800 institutions and serving over $13 trillion in collective assets. Verafin's agentic AI workforce is now used by 750 clients, with new auto dispositioning capabilities planned for Q3 to further enhance automation.

    05

    Market Services Volume Records and Strategic Initiatives

    Market Services achieved 11% organic net revenue growth, benefiting from record industry volumes in U.S. options and cash equities. The division set new records during the June triple witch expiration, with $296 billion in notional value traded, and the Russell Reconstitution, which saw $334 billion in notional value and 4.6 billion shares traded. Nasdaq is also progressing on strategic initiatives, including the projected launch of 23/5 trading on December 6, 2026, and event options in Q4, following SEC approval.

    06

    Evolving Market Structure and Tokenization

    Nasdaq is actively engaging with regulators to shape the future of markets, particularly concerning innovations like always-on trading and asset tokenization. While perpetual derivatives are currently outside Nasdaq's core equity markets, the company sees opportunities in providing technology and surveillance for such markets. Nasdaq is also advancing tokenized equities, including a successful proof of concept with two major asset managers on the Canton network to facilitate tokenized collateral movement through Calypso, with a broader launch of tokenized equities expected early next year.

    07

    Data Business Growth Drivers

    Demand for Nasdaq's data solutions is being propelled by three main trends: AI use cases, digital asset platforms, and the upcoming 23/5 trading initiative. The company launched the Data Link Model Context Protocol (MCP) to enable smoother integration of its data into AI-driven applications. The growth in digital asset platforms and the increasing international demand for real-time data, particularly from brokers preparing for 23/5 trading, are further accelerating sales and usage of Nasdaq's proprietary data assets.

    AI-generated summary of the company’s earnings call. Not investment advice.