Nasdaq, Inc.
Oct 25, 2017

Nasdaq Reports Third Quarter 2017 Results; Delivers Strong Profitability and Income Growth

NEW YORK, Oct. 25, 2017 (GLOBE NEWSWIRE) -- Nasdaq, Inc. (Nasdaq:NDAQ) today reported financial results for the third quarter of 2017.  Third quarter 2017 net revenues were $607 million, up $22 million or 4% from $585 million in the prior year period.  The third quarter increase in net revenues included a $15 million, or 3%, increase due to organic growth and a $7 million favorable impact due to changes in foreign exchange rates.

"We achieved strong results in the third quarter due in large part to success in delivering on our 2017 execution priorities, including successfully integrating the 2016 acquisitions, improving our competitive positioning across the franchise and commercializing key technologies," said Adena Friedman, President and CEO, Nasdaq.  "Additionally, we completed a strategic review and initiated a business pivot to move more of our resources behind our most sizable growth opportunities.  Initial actions supporting this new direction include organic investment in our Market Technology and Information Services businesses.  Additionally, we completed the acquisitions of eVestment and Sybenetix, and made the decision to explore strategic alternatives for our Public Relations Solutions and Digital Media Services businesses within our Corporate Solutions business."

Mrs. Friedman continued, "We also remain very focused on advancing capital markets reform and to that effect, were pleased to see the U.S. Treasury supporting many of the proposals put forth in our May 2017 blueprint to revitalize the U.S. capital markets,4 which champions reforms and initiatives that we believe improve the public company experience and advance the U.S. economy.  We look forward to continue advocating on behalf of our clients in this area."

1 Represents revenues less transaction-based expenses.
2 Refer to our reconciliations of U.S. GAAP to non-GAAP net income, diluted earnings per share, operating income and operating expenses, included in the attached schedules.
3 In the first quarter of 2017, we adopted new accounting guidance which requires us to recognize the tax effect related to the vesting of share-based awards in income tax expense in the statements of income rather than in equity.
4 For more information, please see http://business.nasdaq.com/revitalize

GAAP operating expenses were $343 million in the third quarter of 2017, down $9 million from $352 million in the third quarter of 2016.  The decrease primarily reflects lower merger and strategic initiatives expense.

Non-GAAP operating expenses were $317 million in the third quarter of 2017, unchanged compared to the third quarter of 2016.  This reflects a $4 million organic expense decrease offset by a $4 million unfavorable impact from changes in foreign exchange rates.

"During the period, the company delivered growth in our subscription and recurring revenue businesses as well as margin expansion through achievement of synergies related to our 2016 acquisitions, combining to drive a 12% year-over-year increase in non-GAAP diluted EPS, excluding the impact of changes in share-based tax accounting," said Michael Ptasznik, Executive Vice President and Chief Financial Officer, Nasdaq.

Mr. Ptasznik continued, "Additionally, we have refined our framework for deploying capital and internal resources to support the growth objectives of our fastest growing businesses, while remaining committed to continuing our strong capital return track record.  These actions are expected to bolster our ability to deliver on our double-digit total shareholder return target."

On a GAAP basis, net income attributable to Nasdaq for the third quarter of 2017 was $171 million, or $1.01 per diluted share, compared with net income of $131 million, or $0.77 per diluted share, in the third quarter of 2016.

On a non-GAAP basis, net income attributable to Nasdaq for the third quarter of 2017 was $181 million, or $1.06 per diluted share, compared with $154 million, or $0.91 per diluted share, in the third quarter of 2016.

At September 30, 2017, the company had cash and cash equivalents of $530 million and total debt of $3,743 million, resulting in net debt of $3,213 million. This compares to net debt of $3,200 million at December 31, 2016.  As of September 30, 2017, there was $255 million remaining under the board authorized share repurchase program.  Share repurchases totaled $18 million during the third quarter of 2017.

2017 EXPENSE GUIDANCE1 - The company is updating its 2017 non-GAAP operating expense guidance to $1,275 to $1,290 million, versus prior 2017 expense guidance of $1,260 to $1,290 million.  The increase primarily relates to the closing of the acquisitions of eVestment and Sybenetix.

1 U.S. GAAP operating expense guidance is not provided due to the inherent difficulty in quantifying certain amounts due to a variety of factors including the unpredictability in the movement in foreign currency rates, as well as future charges or reversals outside of the normal course of business.

BUSINESS HIGHLIGHTS

Market Services (36% of total net revenues) - Net revenues were $219 million in the third quarter of 2017, up $6 million when compared to the third quarter of 2016.

 Equity Derivatives (10% of total net revenues) - Net equity derivative trading and clearing revenues were $62 million in the third quarter of 2017, down $5 million compared to the third quarter of 2016.  The decrease primarily reflects lower net revenue capture, partially offset by higher U.S. industry trading volumes and higher U.S. market share.
  
 Cash Equities (10% of total net revenues) - Net cash equity trading revenues were $62 million in the third quarter of 2017, up $3 million from the third quarter of 2016.  This increase primarily reflects higher European cash equities revenues as well a favorable impact from changes in foreign exchange rates.
  
 Fixed Income and Commodities Trading and Clearing (4% of total net revenues) - Net fixed income and commodities trading and clearing revenues were $20 million in the third quarter of 2017, up $2 million from the third quarter of 2016, primarily due to higher volumes and pricing changes at NFX and a favorable impact from changes in foreign exchange rates.
  
 Trade Management Services (12% of total net revenues) - Trade management services revenues were $75 million in the third quarter of 2017, up $6 million compared to the third quarter of 2016, primarily due to an increase in customer demand for third-party connectivity, co-location and test facilities as well as a favorable impact from changes in foreign exchange rates.

Corporate Services (26% of total net revenues) - Revenues were $161 million in the third quarter of 2017, down $1 million compared to the third quarter of 2016.

 Corporate Solutions (15% of total net revenues) - Corporate solutions revenues were $94 million in the third quarter of 2017, unchanged from the third quarter of 2016.
  
 Listing Services (11% of total net revenues) - Listing services revenues were $67 million in the third quarter of 2017, down $1 million from the third quarter of 2016.  The change reflects a decrease in U.S. listings revenues due to the run-off of listing of additional shares fees, which is the result of the implementation of our all-inclusive annual fee, partially offset by an increase in European listing services revenues.

Information Services (25% of total net revenues) - Revenues were $150 million in the third quarter of 2017, up $13 million from the third quarter of 2016.

 Data Products (19% of total net revenues) - Data products revenues were $116 million in the third quarter of 2017, up $7 million compared to the third quarter of 2016, primarily due to growth in shared tape plan revenues as well as higher audit collections.
  
 Index Licensing and Services (6% of total net revenues) - Index licensing and services revenues were $34 million in the third quarter of 2017, up $6 million from the third quarter of 2016 primarily due to higher assets under management in exchange traded products linked to Nasdaq indexes.

Market Technology (13% of total net revenues) - Revenues were $77 million in the third quarter of 2017, up $4 million from the third quarter of 2016.  The increase primarily reflects higher change request revenues, organic revenue growth in software as a service revenues, and a favorable impact due to changes in foreign exchange rates, partially offset by lower software, licensing and support revenues.  The decline in software, licensing and support revenues reflected in part the shift in BWise revenues from a perpetual license model to a subscription revenue model.  New order intake totaled $66 million in the third quarter of 2017 while total order value was a record $805 million at September 30, 2017, up 9% from September 30, 2016.

CORPORATE HIGHLIGHTS

ABOUT NASDAQ

Nasdaq (Nasdaq:NDAQ) is a leading global provider of trading, clearing, exchange technology, listing, information and public company services. Through its diverse portfolio of solutions, Nasdaq enables customers to plan, optimize and execute their business vision with confidence, using proven technologies that provide transparency and insight for navigating today's global capital markets. As the creator of the world's second electronic stock market, its technology powers more than 90 marketplaces in 50 countries, and 1 in 10 of the world's securities transactions. Nasdaq is home to approximately 3,900 total listings with a market value of approximately $12 trillion. To learn more, visit: nasdaq.com/ambition or business.nasdaq.com.

NON-GAAP INFORMATION

In addition to disclosing results determined in accordance with U.S. GAAP, Nasdaq also discloses certain non-GAAP results of operations, including, but not limited to, net income attributable to Nasdaq, diluted earnings per share, operating income, and operating expenses, that include certain adjustments or exclude certain charges and gains that are described in the reconciliation table of U.S. GAAP to non-GAAP information provided at the end of this release. 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 results as the items described below do not reflect 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. Investors should not rely on any single financial measure when evaluating our business. We recommend investors review the U.S. GAAP financial measures included in this earnings release. When viewed in conjunction with our U.S. GAAP results and the accompanying reconciliations, 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 attributable to Nasdaq, non-GAAP diluted earnings per share, non-GAAP operating income and non-GAAP operating expenses to assess operating performance. We use these measures 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, such as those described below, that have less bearing on our ongoing operating performance.

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, the relative operating performance of the businesses between periods and the earnings power of Nasdaq. Management does not consider intangible asset amortization expense for the purpose of evaluating the performance of our business or its managers or when making decisions to allocate resources. Therefore, we believe performance measures excluding intangible asset amortization expense provide investors with a more useful representation of our businesses' ongoing activity in each period.

Merger and strategic initiatives expense: We have pursued various strategic initiatives and completed a number of acquisitions 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. The frequency and the amount of such expenses vary significantly based on the size, timing and complexity of the transaction. Accordingly, we exclude these costs for purposes of calculating non-GAAP measures which provide a more meaningful analysis of Nasdaq's ongoing operating performance or comparisons in Nasdaq's performance between periods.

Other significant items: We have excluded certain other charges or gains that are the result of other non-comparable events to measure operating performance. For the three months ended September 30, 2017, other significant items include recognition of previously unrecognized tax benefits associated with positions taken in prior years. For the three months ended June 30, 2017, other significant items include loss on extinguishment of debt, wind down costs associated with an equity method investment which was previously written off, and recognition of previously unrecognized tax benefits associated with positions taken in prior years. We believe the exclusion of such amounts allows management and investors to better understand the financial results of Nasdaq.

Foreign exchange impact: In countries with currencies other than the U.S. dollar, revenues and expenses are translated using monthly average exchange rates. Certain discussions in this release isolate the impact of year-over-year foreign currency fluctuations to better measure the comparability of operating results between periods. Operating results excluding the impact of foreign currency fluctuations are calculated by translating the current period's results by the prior period's exchange rates.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Information set forth in this communication contains forward-looking statements that involve a number of risks and uncertainties. Nasdaq cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information.  Such forward-looking statements include, but are not limited to (i) projections relating to our future financial results, total shareholder returns, growth, trading volumes, products and services, order backlog, taxes and achievement of synergy targets, (ii) statements about the closing or implementation dates and benefits of certain acquisitions and other strategic, restructuring, technology, de-leveraging and capital return initiatives, (iii) statements about our integrations of our recent acquisitions, (iv) statements relating to any litigation or regulatory or government investigation or action to which we are or could become a party, and (v) other statements that are not historical facts. Forward-looking statements involve a number of risks, uncertainties or other factors beyond Nasdaq's control. These factors include, but are not limited to, Nasdaq's ability to implement its strategic initiatives, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk, U.S. and global competition, and other factors detailed in Nasdaq's filings with the U.S. Securities and Exchange Commission, including its annual reports on Form 10-K and quarterly reports on Form 10-Q which are available on Nasdaq's investor relations website at http://ir.nasdaq.com and the SEC's website at www.sec.gov. Nasdaq undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

WEBSITE DISCLOSURE

Nasdaq intends to use its website, ir.nasdaq.com, as a means for disclosing material non-public information and for complying with SEC Regulation FD and other disclosure obligations. These disclosures will be included on Nasdaq's website under "Investor Relations."

MEDIA RELATIONS CONTACT: 
Allan Schoenberg

+1.212.231.5534
allan.schoenberg@nasdaq.com
INVESTOR RELATIONS CONTACT:
Ed Ditmire, CFA

+1.212.401.8737
ed.ditmire@nasdaq.com

NDAQF 

 Nasdaq, Inc.  
 Condensed Consolidated Statements of Income  
 (in millions, except per share amounts)  
(unaudited) 
       
  Three Months Ended  
  September 30,   June 30,   September 30,   
 2017 2017 2016 
Revenues:        
Market Services$581  $620  $557  
Transaction-based expenses:      
Transaction rebates (266)  (304)  (265) 
Brokerage, clearance and exchange fees (96)  (94)   (79) 
Total Market Services revenues less transaction-based expenses 219   222   213  
       
Corporate Services 161   164   162  
Information Services 150   144   137  
Market Technology 77   72   73  
       
Revenues less transaction-based expenses  607   602   585  
       
Operating Expenses:       
Compensation and benefits 169   163   168  
Professional and contract services 39   38   40  
Computer operations and data communications 31   30   28  
Occupancy 23   23   23  
General, administrative and other 15   30   19  
Marketing and advertising 7   8   8  
Depreciation and amortization 47   47   46  
Regulatory 9   8   8  
Merger and strategic initiatives 3    11   12  
Total operating expenses  343   358   352  
       
Operating income  264   244   233  
       
Interest income 2   2   1  
Interest expense (34)  (36)  (37) 
Other investment income -   1   -  
Net income from unconsolidated investees 4   2   2  
       
Income before income taxes  236   213   199  
Income tax provision 65   66   68  
       
Net income attributable to Nasdaq $171  $147  $131  
       
Per share information:       
Basic earnings per share$1.03  $0.89  $0.79  
Diluted earnings per share$1.01  $0.87  $0.77  
Cash dividends declared per common share$0.38  $0.38  $0.32  
       
Weighted-average common shares outstanding        
 for earnings per share:       
Basic 166.7   165.4   165.6  
Diluted 170.0   168.5   169.5  
       

Nasdaq, Inc. 
Revenue Detail 
(in millions) 
(unaudited) 
        
   Three Months Ended  
   September 30,   June 30,   September 30 ,  
  2017   2017    2016  
MARKET SERVICES REVENUES       
Equity Derivative Trading and Clearing Revenues$178  $191  $164  
Transaction-based expenses:      
Transaction rebates (106)  (115)  (90) 
Brokerage, clearance and exchange fees (10)  (9)  (7) 
Total net equity derivative trading and clearing revenues 62   67   67  
        
Cash Equity Trading Revenues 304   333   302  
Transaction-based expenses:       
Transaction rebates (157)  (185)   (171) 
Brokerage, clearance and exchange fees (85)  (84)  (72) 
Total net cash equity trading revenues 62   64   59  
       
Fixed Income and Commodities Trading and Clearing Revenues  24   24   22  
Transaction-based expenses:      
Transaction rebates (3)  (4)  (4) 
Brokerage, clearance and exchange fees (1)   (1)  -  
Total net fixed income and commodities trading and clearing revenues 20   19    18  
       
Trade Management Services Revenues 75   72   69  
       
Total Net Market Services revenues 219   222   213  
       
CORPORATE SERVICES REVENUES       
Corporate Solutions revenues 94   97   94  
Listings Services revenues 67   67   68  
       
Total Corporate Services revenues 161   164   162  
       
INFORMATION SERVICES REVENUES       
Data Products revenues  116   111   109  
Index Licensing and Services revenues 34   33   28   
       
Total Information Services revenues 150   144   137  
       
MARKET TECHNOLOGY REVENUES  77   72   73  
       
Revenues less transaction-based expenses $607  $602  $585  
       

Nasdaq, Inc. 
Condensed Consolidated Balance Sheets  
(in millions) 
  
    September 30, December 31,   
    2017 2016   
 Assets (unaudited)     
 Current assets:      
  Cash and cash equivalents$530  $403    
  Restricted cash 21   15    
  Financial investments, at fair value 207   245    
  Receivables, net 320    429    
  Default funds and margin deposits 3,893   3,301    
   Other current assets 175   167    
  Assets held for sale 300   -    
 Total current assets 5,446   4,560    
 Property and equipment, net 379   362    
 Deferred tax assets 611   717    
 Goodwill   6,154   6,027    
 Intangible assets, net 2,091   2,094    
 Other non-current assets 391   390    
 Total assets$15,072   $14,150    
          
 Liabilities       
 Current liabilities:      
  Accounts payable and accrued expenses$168  $175    
  Section 31 fees payable to SEC 31   108    
  Accrued personnel costs 130   207    
  Deferred revenue 204   162    
  Other current liabilities 94   129    
  Default funds and margin deposits 3,893   3,301    
  Short-term debt 154   -    
  Liabilities held for sale 49   -    
 Total current liabilities 4,723   4,082    
 Long-term debt 3,589   3,603    
 Deferred tax liabilities 726   720    
 Non-current deferred revenue 157   171    
 Other non-current liabilities 142   144     
 Total liabilities 9,337   8,720    
          
 Commitments and contingencies       
 Equity       
 Nasdaq stockholders' equity:      
  Common stock 2   2     
  Additional paid-in capital 3,012    3,104    
  Common stock in treasury, at cost (241)  (176)   
  Accumulated other comprehensive loss (825)  (979)   
  Retained earnings 3,787   3,479    
  Total Nasdaq stockholders' equity 5,735   5,430    
 Total liabilities and equity$15,072  $14,150    
          

Nasdaq, Inc. 
Reconciliation of U.S. GAAP Net Income, Diluted Earnings Per Share, Operating Income and  
Operating Expenses to Non-GAAP Net Income, Diluted Earnings Per Share, Operating Income, and Operating Expenses 
(in millions, except per share amounts) 
(unaudited) 
         
         
    Three Months Ended   
   September 30,   June 30,   September 30,   
   2017   2017   2016   
         
U.S. GAAP net income attributable to Nasdaq $  171  $  147  $  131   
         
Non-GAAP adjustments:        
         
Amortization expense of acquired intangible assets (1)    22     22     23   
Merger and strategic initiatives (2)    3      11     12   
Extinguishment of debt (3)    -      10     -    
Other (4)    1     2     -    
Total non-GAAP adjustments    26     45     35   
         
Non-GAAP adjustment to the income tax provision (5)    (16)     (20)    (12)  
Total non-GAAP adjustments, net of tax    10     25     23   
         
Non-GAAP net income attributable to Nasdaq $  181  $  172  $  154   
         
         
U.S. GAAP diluted earnings per share $  1.01  $  0.87  $  0.77   
Total adjustments from non-GAAP net income above    0.05     0.15     0.14   
         
Non-GAAP diluted earnings per share $  1.06  $  1.02  $  0.91   
         
 Weighted-average diluted common shares outstanding        
 for earnings per share:     170.0     168.5      169.5   
         
(1) Refer to the non-GAAP information section of the earnings release for further discussion of why we consider amortization expense of acquired intangible assets to be a non-GAAP adjustment.
 
(2) For the three months ended September 30, 2017, merger and strategic initiatives expense is primarily related to our acquisitions of eVestment, Inc and Sybenetix as well as costs associated with the potential strategic alternatives for our Public Relations and Digital Media businesses within our Corporate Solutions business. For the three months ended June 30, 2017 and September 30, 2016, merger and strategic initiatives expense primarily related to our acquisition of International Securities Exchange, or ISE. Refer to the non-GAAP information section of the earnings release for further discussion on why we consider merger and strategic initiatives expense to be a non-GAAP adjustment.
 
(3) During the three months ended June 30, 2017, in connection with the early extinguishment of our 5.25% senior unsecured notes issued in December 2010 and the $300 million repayment on our $400 million senior unsecured term loan facility due November 25, 2019, we recorded a charge of $10 million primarily related to a premium paid for early redemption.
 
(4) For the three months ended June 30, 2017, other charge relates to wind down costs associated with an equity method investment that was previously written off, which is included in net income from unconsolidated investees in the Condensed Consolidated Statements of Income.
 
(5) For the three months ended September 30, 2017, June 30, 2017, and September 30, 2016, the non-GAAP adjustment to the income tax provision primarily reflects the tax impact of each non-GAAP adjustment. In addition, the non-GAAP adjustment to the income tax provision reflects the recognition of previously unrecognized tax benefits associated with positions taken in prior years of $8 million for the three months ended September 30, 2017 and $4 million for the three months ended June 30, 2017.

Nasdaq, Inc. 
Reconciliation of U.S. GAAP Net Income, Diluted Earnings Per Share, Operating Income and  
Operating Expenses to Non-GAAP Net Income, Diluted Earnings Per Share, Operating Income, and Operating Expenses 
(in millions) 
(unaudited) 
         
         
   Three Months Ended   
   September 30,    June 30,   September 30,   
  2017 2017 2016  
         
U.S. GAAP operating income $ 264  $244  $233   
         
Non-GAAP adjustments:        
         
Amortization expense of acquired intangible assets (1)  22   22   23   
Merger and strategic initiatives (2)  3   11   12   
Extinguishment of debt (3)  -   10   -   
Other  1   -   -   
Total non-GAAP adjustments  26   43   35   
         
Non-GAAP operating income $290  $287  $268   
         
         
 Revenues less transaction-based expenses  $607  $602  $585    
          
U.S. GAAP operating margin (4)  43%   41%  40%  
         
Non-GAAP operating margin (5)  48 %  48%   46%  
 
(1) Refer to the non-GAAP information section of the earnings release for further discussion of why we consider amortization expense of acquired intangible assets to be a non-GAAP adjustment.
 
(2) For the three months ended September 30, 2017, merger and strategic initiatives expense is primarily related to our acquisitions of eVestment, Inc and Sybenetix as well as costs associated with the potential strategic alternatives for our Public Relations and Digital Media businesses within our Corporate Solutions business. For the three months ended June 30, 2017 and September 30, 2016, merger and strategic initiatives expense primarily related to our acquisition of ISE. Refer to the non-GAAP information section of the earnings release for further discussion on why we consider merger and strategic initiatives expense to be a non-GAAP adjustment.
 
(3) During the three months ended June 30, 2017, in connection with the early extinguishment of our 5.25% senior unsecured notes issued in December 2010 and the $300 million repayment on our $400 million senior unsecured term loan facility due November 25, 2019, we recorded a charge of $10 million primarily related to a premium paid for early redemption.
 
(4) U.S. GAAP operating margin equals U.S. GAAP operating income divided by total revenues less transaction-based expenses.
 
(5) Non-GAAP operating margin equals non-GAAP operating income divided by total revenues less transaction-based expenses.

Nasdaq, Inc. 
Reconciliation of U.S. GAAP Net Income, Diluted Earnings Per Share, Operating Income and  
Operating Expenses to Non-GAAP Net Income, Diluted Earnings Per Share, Operating Income, and Operating Expenses 
(in millions) 
(unaudited) 
         
         
   Three Months Ended   
   September 30,   June 30,   September 30,   
  2017 2017 2016  
         
U.S. GAAP operating expenses $343  $358  $352   
         
Non-GAAP adjustments:        
         
Amortization expense of acquired intangible assets (1)  (22)  (22)  (23)  
Merger and strategic initiatives (2)  (3)  (11)  (12)  
Extinguishment of debt (3)  -   (10)  -   
Other  (1)  -   -   
Total non-GAAP adjustments  (26)   (43)  (35)  
         
Non-GAAP operating expenses $317  $315  $317   
         
(1) Refer to the non-GAAP information section of the earnings release for further discussion of why we consider amortization expense of acquired intangible assets to be a non-GAAP adjustment.
 
(2) For the three months ended September 30, 2017, merger and strategic initiatives expense is primarily related to our acquisitions of eVestment, Inc and Sybenetix as well as costs associated with the potential strategic alternatives for our Public Relations and Digital Media businesses within our Corporate Solutions business. For the three months ended June 30, 2017 and September 30, 2016, merger and strategic initiatives expense primarily related to our acquisition of ISE. Refer to the non-GAAP information section of the earnings release for further discussion on why we consider merger and strategic initiatives expense to be a non-GAAP adjustment.
 
(3) During the three months ended June 30, 2017, in connection with the early extinguishment of our 5.25% senior unsecured notes issued in December 2010 and the $300 million repayment on our $400 million senior unsecured term loan facility due November 25, 2019, we recorded a charge of $10 million primarily related to a premium paid for early redemption.

Nasdaq, Inc. 
Quarterly Key Drivers Detail 
(unaudited) 
       
 Three Months Ended 
  September 30,    June 30,   September 30,  
  2017 2017 2016 
Market Services      
Equity Derivative Trading and Clearing      
U.S. equity options      
Total industry average daily volume (in millions) 14.1   14.8   13.8  
Nasdaq PHLX Options Market matched market share 16.9%  16.8%  16.0% 
The Nasdaq Options Market matched market share 9.1%  9.8%  8.5% 
Nasdaq BX Options Market matched market share 0.7%  0.7%  0.8% 
Nasdaq ISE Options Market matched market share 8.8%  9.0%  12.0% 
Nasdaq GEMX Options Market matched market share 5.3%  4.9%  1.8% 
Nasdaq MRX Options Market matched market share 0.2%  0.2%  0.2% 
Total matched market share executed on Nasdaq's exchanges 41.0%  41.4%  39.3% 
       
Nasdaq Nordic and Nasdaq Baltic options and futures      
Total average daily volume options and futures contracts (1) 296,086   376,280   291,410  
       
Cash Equity Trading      
Total U.S.-listed securities      
Total industry average daily share volume (in billions) 6.06   6.85   6.59  
Matched share volume (in billions) 69.1   79.4   71.0  
The Nasdaq Stock Market matched market share 14.1%  14.4%   13.4% 
Nasdaq BX matched market share 3.3%  3.2%   2.6% 
Nasdaq PSX matched market share 0.7%  0.8%  0.9% 
Total matched market share executed on Nasdaq's exchanges 18.1%  18.4%  16.9% 
Market share reported to the FINRA/Nasdaq Trade Reporting Facility 34.1%  33.9%  33.5% 
Total market share (2) 52.2%  52.3%  50.4% 
       
Nasdaq Nordic and Nasdaq Baltic securities      
Average daily number of equity trades executed on Nasdaq exchanges  545,115   594,901   410,999  
Total average daily value of shares traded (in billions)$5.1  $5.7  $4.4  
Total market share executed on Nasdaq's exchanges 67.9%  65.7%  61.3% 
       
Fixed Income and Commodities Trading and Clearing      
Fixed Income      
U.S. fixed income notional trading volume (in billions)$3,975  $4,755  $4,816  
Total average daily volume of Nasdaq Nordic and Nasdaq Baltic fixed income 
  contracts
 101,026   118,234   73,422  
       
Commodities      
Power contracts cleared (TWh) (3) 264   268   321  
       
Corporate Services      
Initial public offerings      
The Nasdaq Stock Market  34   36   31  
Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 10   39   5  
       
Total new listings      
The Nasdaq Stock Market (4) 78   64   80  
Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic (5) 11   45   10  
       
Number of listed companies      
The Nasdaq Stock Market (6) 2,935   2,912   2,872  
Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic (7) 952   945   875  
       
Information Services      
Number of licensed ETPs 314   316   289  
ETP assets under management (AUM) tracking Nasdaq indexes (in billions)$154  $147  $118  
       
Market Technology      
Order intake (in millions) (8)$66  $64  $49  
Total order value (in millions) (9)$805  $799  $738  
       
(1) Includes Finnish option contracts traded on EUREX Group. 
(2) Includes transactions executed on The Nasdaq Stock Market's, Nasdaq BX's and Nasdaq PSX's systems plus trades reported through the Financial Industry Regulatory Authority/Nasdaq Trade Reporting Facility. 
(3) Transactions executed on Nasdaq Commodities or OTC and reported for clearing to Nasdaq Commodities measured by Terawatt hours (TWh). 
(4) New listings include IPOs, including those completed on a best efforts basis, issuers that switched from other listing venues, closed-end funds and separately listed exchange traded products, or ETPs. 
(5) New listings include IPOs and represent companies listed on the Nasdaq Nordic and Nasdaq Baltic exchanges and companies on the alternative markets of Nasdaq First North. 
(6) Number of total listings on Nasdaq at period end, including 362 separately listed ETPs at September 30, 2017, 345 at June 30, 2017 and 295 at September 30, 2016. 
(7) Represents companies listed on the Nasdaq Nordic and Nasdaq Baltic exchanges and companies on the alternative markets of Nasdaq First North at period end. 
(8) Total contract value of orders signed during the period. 
(9) Represents total contract value of orders signed that are yet to be recognized as revenue.



This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Nasdaq via Globenewswire

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