Nasdaq released its first
quarter 2023 financial results on Wednesday, reporting $914 million in net
revenues. The figure represents a 2% or increase of $22 million from the $892
million generated during the same period last year.However, the American exchange
and global financial markets infrastructure provider’s initial performance were
much better. Nasdaq said it initially generated an increase of 4% or $36 million in
its net revenue, owing to organic growth and positive contributions from all
its business segments. However, this figure was partially offset
by a decrease of $11 million from the impact of
changes in FX rates during the period. Furthermore, Nasdaq’s acquisition and
divestiture during the period yanked off $3 million from the net revenues.In a separate release, the exchange operator disclosed that it intends to pay a quarterly dividend of $0.22 per share, which is an increase of 10% from the previous quarter. The firm added that “the dividend is payable on June 30, 2023, to shareholders of record at the close of business on June 16, 2023.”How Nasdaq Business Segments
PerformedDuring Q1 2023, the solutions
businesses and trading services that make up Nasdaq’s business reported a single-digit growth rate partially offset by changes in FX rates. While the
former returned 4% growth or $646 million, the
latter earned $267 million or an increase of 1% from the prior year period.“Trading Services net revenues
reflect strong growth from North American trading partially offset by a decline
in European trading,” Nasdaq noted.In terms of operating expenses,
Nasdaq’s recorded an increase of 3% in the cost of running its business. The cost,
when accounted for in line with the Generally Accepted Accounting Principles
(GAAP), rose to $15 million during the first three months of 2023.“The increase primarily reflects
higher restructuring expenses associated with the launch of our divisional
alignment program in the fourth quarter of 2022 and higher occupancy expense
due to lease asset impairment charges in the first quarter of 2023 driven by a
reduction in our real estate footprint, partially offset by lower merger and
strategic initiatives expense and changes in FX rates,” Nasdaq explained. Other Q1 Updates from NasdaqMeanwhile, during the first
three months of 2023, Nasdaq bought back $159 million worth of its common
shares. This leaves Nasdaq with $491 million worth of common stock to be acquired under the firm’s share repurchase programme as of March 31, 2023.Furthermore, Verafin, Nasdaq’s
fraud detection and anti-money laundering software subsidiary, signed its first global Tier 1 bank in April. Additionally, the subsidiary onboarded its first Tier 2
client during the first quarter of the year. However, Nasdaq did not disclose the names of the new clients.“These signings further
underscore Verafin’s progress with large bank clients, as its solutions seek to
displace legacy platforms and manual processes with a cloud-based and
market-proven solution,” Nasdaq explained.In addition, during Q1 2023,
Nasdaq maintained its listings leadership in the United States and led all exchanges
in total multiply-listed options traded. Moreover, the exchange said it is
doubling down on its cloud migration strategy with plans to migrate a second
options exchange by the end of 2023. “Nasdaq delivered a solid
financial performance during the first quarter of 2023, driven by momentum
across our divisions,” noted Adena Friedman, Nasdaq’s Chair and CEO.Friedman explained that the publicly traded company’s investments in proprietary data and the migration of its
markets and Sofware-as-a-Service solutions to the cloud “uniquely positions us
to harness the potential of advanced AI to improve the liquidity, transparency,
and integrity of the financial system in the coming years.”Maoz Tenenbaum leaves Leverate; Cornerstone’s revenue; read today’s news nuggets.
This article was written by Solomon Oladipupo at www.financemagnates.com.
