Nasdaq, Inc.
Jan 29, 2015

Nasdaq Reports Record Fourth Quarter 2014 Non-GAAP: Operating Income, Net Income and Diluted EPS

NEW YORK, Jan. 29, 2015 (GLOBE NEWSWIRE) -- The NASDAQ OMX Group, Inc. (Nasdaq:NDAQ) today reported results for the fourth quarter of 2014. Fourth quarter net revenues were $517 million, down 1% from $520 million in the prior year period, driven by the impact of foreign exchange rates. On an organic basis, excluding the impact of foreign exchange rates, fourth quarter net revenues increased 3% year-over-year.

"Nasdaq's record profitability resulted from its improved strategic positioning, successfully meeting the evolving demands of our diverse client base, and maintaining the organization's relentless focus on efficiency," said Bob Greifeld, CEO, Nasdaq. "Moreover, the strong results in the fourth quarter, and 2014 overall, were driven by both broad-based organic growth and the first full year of contributions from our recent acquisitions."

Mr. Greifeld continued, "I'm also pleased to say that we realized a sequential uptick in organic growth in the fourth quarter. More importantly, we see clear avenues to accelerate organic growth further from strategic investments made in upgrading and launching several product offerings within recently-acquired fixed income and corporate solutions businesses. The 2015 environmental backdrop also shows evidence of continued momentum and should bring us new opportunities to serve customers."

On a non-GAAP basis, fourth quarter 2014 operating expenses were $296 million, down 5% as compared to the prior year quarter, due to the impact of changes in foreign exchange rates and the result of the expense reduction initiatives in 2014. On an organic basis, fourth quarter 2014 non-GAAP operating expenses were down 2% compared to the prior year period. On a GAAP basis, operating expenses were $344 million in the fourth quarter of 2014, up 22% compared to $282 million in the prior year quarter.

Fourth quarter 2014 non-GAAP diluted earnings per share was $0.75, compared to $0.69 in the prior year quarter. Non-GAAP diluted earnings per share for the fourth quarter of 2014 excluded $97 million of pre-tax adjustments, including: $49 million of asset impairment charges related to acquired intangible assets associated with certain customer relationships and certain technology assets, $35 million of merger and strategic initiatives costs (including a charge of $23 million related to the reversal of a receivable under a tax sharing agreement with an unrelated party that is offset on the tax line, and $12 million primarily associated with our acquisitions of the Thomson Reuters Corporate businesses), $11 million of sublease loss reserve charges on space we currently occupy due to excess capacity, and $2 million of debt extinguishment costs incurred with the refinancing of the company's credit facility.

Please refer to our reconciliation of GAAP to non-GAAP net income, diluted earnings per share, operating income and operating expenses included in the attached schedules.

On a GAAP basis, net income attributable to Nasdaq for the fourth quarter of 2014 was $87 million, or $0.50 per diluted share, compared with $141 million, or $0.81 per diluted share, in the prior year quarter.

"Our continued expense discipline offset foreign exchange headwinds and helped deliver record earnings for our shareholders," said Lee Shavel, EVP and CFO, Nasdaq. "We anticipate the ongoing successful integration of acquisitions, coupled with our broader expense management philosophy, will create margin expansion opportunities throughout 2015."

Mr. Shavel continued, "Additionally, we continue to balance the use of our capital to create value for shareholders and clients. We have repurchased $178 million in stock since the second quarter while also enhancing our profitability profile, growth dynamics and product offering through the agreement to acquire Dorsey, Wright & Associates. We will continue to utilize our capital with the goals of maximizing returns for our shareholders and creating value for our clients."

The company repurchased 1.4 million shares, or $58 million of stock, in the fourth quarter of 2014 at an average price of $42.07.

On December 31, 2014, the company had cash and cash equivalents of $427 million and total debt of $2,313 million, resulting in net debt of $1,886 million. This compares to net debt of $2,236 million at December 31, 2013.

1 Represents revenues less transaction-based expenses.

BUSINESS HIGHLIGHTS

Market Services (39% of total net revenues) - Net revenues were $205 million in the fourth quarter of 2014, up $1 million when compared to $204 million in the fourth quarter of 2013.

Equity Derivatives (10% of total net revenues) - Net equity derivative trading and clearing revenues were $53 million in the fourth quarter of 2014, down $1 million compared to the fourth quarter of 2013. The decline in equity derivatives revenue was driven by changes in foreign exchange rates. Excluding the impact of foreign exchange rates, revenues rose on higher contract volumes in both U.S. and European markets, partially offset by moderate declines in average capture.

Cash Equities (11% of total net revenues) - Net cash equity trading revenues were $59 million in the fourth quarter of 2014, up $9 million compared to the fourth quarter of 2013. The increase in cash equity trading revenue resulted primarily from higher U.S. industry trading volume and an increase in overall market share executed on Nasdaq's exchanges. Revenues from European cash equities rose modestly, as higher industry value traded, average capture and market share were partially offset by the impact of changes in foreign exchange rates.

Fixed Income, Currency and Commodities (6% of total net revenues) - Net FICC trading revenues were $29 million in the fourth quarter of 2014, down $7 million from the fourth quarter of 2013, due to declines across most FICC product volumes, a scheduled reduction in payments from an eSpeed technology customer, and the impact of changes in foreign exchange rates.

Access and Broker Services (12% of total net revenues) - Access and broker services revenues totaled $64 million in the fourth quarter of 2014, unchanged compared to the fourth quarter of 2013, as core revenue increases were offset by the impact of changes in foreign exchange rates.

Information Services (22% of total net revenues) - Revenues were $113 million in the fourth quarter of 2014, up $6 million from the fourth quarter of 2013.

Data Products (18% of total net revenues) - Data products revenues were $91 million in the fourth quarter of 2014, up $4 million compared to the fourth quarter of 2013, due primarily to increased revenues from Nasdaq BASIC.

Index Licensing and Services (4% of total net revenues) - Index licensing and services revenues were $22 million in the fourth quarter of 2014, up $2 million from the fourth quarter of 2013. The revenue growth was largely a function of materially higher assets under management in licensed exchange traded products.

Technology Solutions (27% of total net revenues) - Revenues were $138 million in the fourth quarter of 2014, down $13 million from the fourth quarter of 2013.

Corporate Solutions (15% of total net revenues) - Corporate solutions revenues were $78 million in the fourth quarter of 2014, down $5 million from the fourth quarter of 2013. The corporate solutions revenue decline was due primarily to IR product pricing actions designed to compensate for subsidies previously provided to certain customers by a competitor, as well as to maintain and promote broader customer relationships. Additional declines in IR products and the impact of changes in foreign exchange rates were partially offset by organic growth in multimedia and governance solutions.

Market Technology (12% of total net revenues) - Market technology revenues were $60 million in the fourth quarter of 2014, down $8 million from the fourth quarter of 2013. Declines were driven primarily by an unfavorable foreign exchange impact and the recognition of $3 million of previously deferred revenues at BWise in the fourth quarter of 2013, partially offset by organic growth, in particular from expansion of SMARTS Broker surveillance and BWise enterprise risk management solutions. New order intake of $193 million for the fourth quarter of 2014 and the $704 million backlog at December 31, 2014 each set new all-time record highs.

Listing Services (12% of total net revenues) - Revenues were $61 million in the fourth quarter of 2014, up $3 million compared to the fourth quarter of 2013 due to increases in the number of both U.S. and European listed companies, and a higher number of initial public offerings (IPOs), partially offset by the impact of changes in foreign exchange rates.

INITIATING 2015 NON-GAAP EXPENSE GUIDANCE - The company has initiated 2015 non-GAAP operating expense guidance of $1,120-$1,150 million, which excludes amortization of acquired intangibles. Included in this non-GAAP operating expense guidance is an expected $30-$40 million in R&D spending.

CORPORATE HIGHLIGHTS

ABOUT NASDAQ

Nasdaq (Nasdaq:NDAQ) is a leading provider of trading, clearing, exchange technology, regulatory, securities listing, information and public company services across six continents. 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 first electronic stock market, its technology powers more than 70 marketplaces in 50 countries, and 1 in 10 of the world's securities transactions. Nasdaq is home to more than 3,500 listed companies with a market value of over $9.1 trillion and more than 10,000 corporate clients. To learn more, visit www.nasdaq.com/ambition or www.nasdaqomx.com.

NON-GAAP INFORMATION

In addition to disclosing results determined in accordance with 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 make certain adjustments or exclude certain charges and gains that are described in the reconciliation table of GAAP to non-GAAP information provided at the end of this release. Management believes that this non-GAAP information provides investors with additional information to assess Nasdaq's operating performance by making certain adjustments or excluding costs or gains and assists investors in comparing our operating performance to prior periods. Management uses this non-GAAP information, along with GAAP information, in evaluating its historical operating performance.

The non-GAAP information is not prepared in accordance with GAAP and may not be comparable to non-GAAP information used by other companies. The non-GAAP information should not be viewed as a substitute for, or superior to, other data prepared in accordance with GAAP.

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 about our future financial results, growth, trading volumes, products and services, taxes and achievement of synergy targets, (ii) statements about the closing or implementation dates and benefits of certain strategic, 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.

NDAQF

The NASDAQ OMX Group, Inc.
Condensed Consolidated Statements of Income
(in millions, except per share amounts)
 
 
  Three Months Ended Year Ended
  December 31, September 30, December 31, December 31, December 31,
  2014 2014  2013 2014 2013
  (unaudited) (unaudited) (unaudited) (unaudited)  
Revenues:          
Market Services  $ 607  $ 515  $ 533  $ 2,247  $ 2,092
Transaction-based expenses:          
Transaction rebates  (294)  (236)  (254)  (1,065)  (1,002)
Brokerage, clearance and exchange fees  (108)  (85)  (75)  (368)  (314)
Total Market Services revenues less transaction-based expenses  205  194  204  814  776
           
Listing Services  61  59  58  238  228
Information Services  113  114  107  473  436
Technology Solutions  138  130  151  542  455
           
Revenues less transaction-based expenses  517  497  520  2,067  1,895
           
Operating Expenses:          
Compensation and benefits  149  136  146  588  539
Marketing and advertising  8  5  8  32  30
Depreciation and amortization  33  34  34  137  122
Professional and contract services  40  37  45  157  151
Computer operations and data communications  24  22  25  92  82
Occupancy  34  26  27  110  98
Regulatory  6  7  7  27  30
Merger and strategic initiatives  35  5  (11)  81  22
General, administrative and other  15  18  19  89  80
Restructuring charges  --   --   --   --   9
Voluntary accommodation program  --   --   (18)  --   44
Total operating expenses  344  290  282  1,313  1,207
           
Operating income   173  207  238  754  688
           
Interest income   2  1  2  6  9
Interest expense   (28)  (29)  (30)  (117)  (111)
Gain on sale of investment security   --   --   30  --   30
Asset impairment charges   (49)  --   (5)  (49)  (14)
Loss from unconsolidated investees, net   --   --   --   --   (2)
           
Income before income taxes   98  179  235  594  600
Income tax provision   11  56  94  181  216
           
Net income   87  123  141  413  384
           
Net loss attributable to noncontrolling interests   --   --   --   1  1
           
Net income attributable to Nasdaq   $ 87  $ 123  $ 141  $ 414  $ 385
           
Per share information:           
Basic earnings per share   $ 0.52  $ 0.73  $ 0.84  $ 2.45  $ 2.30
Diluted earnings per share   $ 0.50  $ 0.71  $ 0.81  $ 2.39  $ 2.25
Cash dividends declared per common share   $ 0.15  $ 0.15  $ 0.13  $ 0.58  $ 0.52
           
Weighted-average common shares outstanding for earnings per share:           
Basic   168.2  168.6  168.3  168.9  166.9
Diluted   172.5  173.2  173.1  173.0  171.3
           
The NASDAQ OMX Group, Inc.
Revenue Detail
(in millions)
 
  Three Months Ended Year Ended
  December 31, September 30, December 31,  December 31, December 31,
   2014  2014  2013  2014  2013
  (unaudited) (unaudited) (unaudited) (unaudited)  
MARKET SERVICES           
Equity Derivative Trading and Clearing Revenues  $ 135  $ 125  $ 132  $ 525  $ 514
Transaction-based expenses:          
Transaction rebates   (73)  (68)  (71)  (285)  (259)
Brokerage, clearance and exchange fees   (9)  (7)  (7)  (32)  (33)
Total net equity derivative trading and clearing revenues  53  50  54  208  222
           
Cash Equity Trading Revenues  378  296  300  1,335  1,212
Transaction-based expenses:          
Transaction rebates   (221)  (168)  (183)  (780)  (743)
Brokerage, clearance and exchange fees   (98)  (77)  (67)  (332)  (279)
Total net cash equity trading revenues  59  51  50  223  190
           
Fixed Income, Currency and Commodities Trading and Clearing Revenues  30  31  37  130  111
Transaction-based expenses:          
Brokerage, clearance and exchange fees   (1)  (1)  (1)  (4)  (2)
Total net fixed income, currency and commodities trading and clearing revenues  29  30  36  126  109
           
Access and Broker Services Revenues  64  63  64  257  255
           
Total Net Market Services revenues  205  194  204  814  776
           
LISTING SERVICES REVENUES  61  59  58  238  228
           
INFORMATION SERVICES          
Data Products revenues  91  92  87  384  362
Index Licensing and Services revenues  22  22  20  89  74
           
Total Information Services revenues  113  114  107  473  436
           
TECHNOLOGY SOLUTIONS          
Corporate Solutions revenues  78  75  83  314  230
Market Technology revenues  60  55  68  228  225
           
Total Technology Solutions revenues  138  130  151  542  455
           
Total revenues less transaction-based expense   $ 517  $ 497  $ 520  $ 2,067  $ 1,895
           
The NASDAQ OMX Group, Inc.
Revenue Detail
(in millions)
 
  Three Months Ended Year Ended
  March 2014 June 2014 September 2014 December 2014 December 31, December 31, December 31,
  Actual Actual Actual Actual 2014  2013  2012
  (unaudited) (unaudited) (unaudited) (unaudited) (unaudited)    
MARKET SERVICES               
Equity Derivative Trading and Clearing Revenues  $ 138  $ 129  $ 125  $ 135  $ 525  $ 514  $ 507
Transaction-based expenses:               
Transaction rebates   (75)  (71)  (68)  (73)  (285)  (259)  (250)
Brokerage, clearance and exchange fees   (7)  (8)  (7)  (9)  (32)  (33)  (34)
Total net equity derivative trading and clearing revenues  56  50  50  53  208  222  223
               
Cash Equity Trading Revenues  343  318  296  378  1,335  1,212  1,369
Transaction-based expenses:               
Transaction rebates   (210)  (181)  (168)  (221)  (780)  (743)  (854)
Brokerage, clearance and exchange fees   (76)  (81)  (77)  (98)  (332)  (279)  (308)
Total net cash equity trading revenues  57  56  51  59  223  190  207
               
Fixed Income, Currency and Commodities Trading and Clearing Revenues   36  32  31  30  130  111  73
Transaction-based expenses:               
Brokerage, clearance and exchange fees   (1)  (1)  (1)  (1)  (4)  (2)  -- 
Total net fixed income, currency and commodities trading and clearing revenues  35  31  30  29  126  109  73
               
Access and Broker Services Revenues  65  65  63  64  257  255  257
               
Total Net Market Services revenues   213  202  194  205  814  776  760
               
LISTING SERVICES REVENUES   58  60  59  61  238  228  224
               
INFORMATION SERVICES               
Data Products revenues  100  101  92  91  384  362  337
Index Licensing and Services revenues  23  22  22  22  89  74  63
               
Total Information Services revenues   123  123  114  113  473  436  400
               
TECHNOLOGY SOLUTIONS               
Corporate Solutions revenues  82  80  75  78  314  230  89
Market Technology revenues  53  58  55  60  228  225  201
               
Total Technology Solutions revenues   135  138  130  138  542  455  290
               
Total revenues less transaction-based expenses   $ 529  $ 523  $ 497  $ 517  $ 2,067  $ 1,895  $ 1,674
               
The NASDAQ OMX Group, Inc.
Condensed Consolidated Balance Sheets
(in millions)
 
  December 31, December 31,
  2014 2013
Assets (unaudited)  
Current assets:    
Cash and cash equivalents  $ 427  $ 398
Restricted cash  49  84
Financial investments, at fair value  174  189
Receivables, net  389  393
Deferred tax assets  16  12
Default funds and margin deposits  2,194  1,961
Other current assets  151  126
Total current assets  3,400  3,163
Property and equipment, net  292  268
Non-current deferred tax assets 536  404
Goodwill  5,538 6,186
Intangible assets, net  2,077  2,386
Other non-current assets  244  170
Total assets  $ 12,087  $ 12,577
     
Liabilities     
Current liabilities:    
Accounts payable and accrued expenses  $ 189  $ 228
Section 31 fees payable to SEC  124  82
Accrued personnel costs  143  154
Deferred revenue  177  151
Other current liabilities  116  141
Deferred tax liabilities  37  38
Default funds and margin deposits  2,194  1,961
Current portion of debt obligations  --   45
Total current liabilities  2,980  2,800
Debt obligations  2,313  2,589
Non-current deferred tax liabilities  626  708
Non-current deferred revenue  215  143
Other non-current liabilities  159  153
Total liabilities  6,293  6,393
     
Commitments and contingencies     
Equity    
Nasdaq stockholders' equity:    
Common stock  2  2
Additional paid-in capital  3,222  4,278
Common stock in treasury, at cost  (41)  (1,005)
Accumulated other comprehensive loss  (682)  (67)
Retained earnings  3,292  2,976
Total Nasdaq stockholders' equity  5,793  6,184
Noncontrolling interests  1  -- 
Total equity  5,794  6,184
Total liabilities and equity  $ 12,087  $ 12,577
     
The NASDAQ OMX Group, Inc.
Reconciliation of 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 Year Ended
  December 31, September 30, December 31, December 31, December 31,
   2014  2014  2013  2014  2013
GAAP net income attributable to Nasdaq  $ 87  $ 123  $ 141  $ 414  $ 385
           
Non-GAAP adjustments:          
           
Asset impairment charges (1)  49  --   5  49  14
Merger and strategic initiatives (2)  35  5  (11)  81  22
Sublease loss reserves  11  --   --   11  -- 
Extinguishment of debt  2  --   --   11  -- 
Gain on sale of investment security  --   --   (30)  --   (30)
Voluntary accommodation program  --   --   (18)  --   44
Securities and Exchange Commission matter  --   --   --   --   10
Restructuring charges  --   --   --   --   9
Special legal expenses  --   --   1  2  3
Other  --   1  (3)  2  (3)
Total non-GAAP adjustments  97  6  (56)  156  69
           
Adjustment to the income tax provision to reflect non-GAAP adjustments (3)  (55)  (2)  33  (72)  (13)
Significant tax adjustments, net  --   (2)  1  1  4
Total non-GAAP adjustments, net of tax  42  2  (22)  85  60
           
Non-GAAP net income attributable to Nasdaq  $ 129  $ 125  $ 119  $ 499  $ 445
           
           
GAAP diluted earnings per share  $ 0.50  $ 0.71  $ 0.81  $ 2.39  $ 2.25
Total adjustments from non-GAAP net income above  0.25  0.01  (0.12)  0.49  0.35
           
Non-GAAP diluted earnings per share  $ 0.75  $ 0.72  $ 0.69  $ 2.88  $ 2.60
           
           
           
  Three Months Ended Year Ended
  December 31, September 30, December 31, December 31, December 31,
   2014  2014  2013 2014  2013
           
GAAP operating income  $ 173  $ 207  $ 238  $ 754  $ 688
           
Non-GAAP adjustments:          
           
Merger and strategic initiatives (2)  35  5  (11)  81  22
Sublease loss reserves  11  --   --   11  -- 
Extinguishment of debt  2  --   --   11  -- 
Voluntary accommodation program  --   --   (18)  --   44
Special legal expenses  --   --   1  2  3
Securities and Exchange Commission matter  --   --   --   --   10
Restructuring charges  --   --   --   --   9
Other  --   1  (3)  2  (3)
Total non-GAAP adjustments  48  6  (31)  107  85
           
Non-GAAP operating income  $ 221  $ 213  $ 207  $ 861  $ 773
           
           
Revenues less transaction-based expenses  $ 517  $ 497  $ 520  $ 2,067  $ 1,895
           
Non-GAAP operating margin (4) 43% 43% 40% 42% 41%
           
           
(1) For the three months and year ended December 31, 2014, asset impairment charges of $49 million related to certain acquired intangible assets associated with customer relationships ($38 million) and certain technology assets ($11 million). For the year ended December 31, 2013, asset impairment charges of $14 million related to certain acquired intangible assets associated with customer relationships ($7 million) and a certain trade name ($7 million).
 
(2) For the three months and year ended December 31, 2014, merger and strategic initiatives expense primarily related to our acquisitions of the TR Corporate businesses and eSpeed and a charge of $23 million related to the reversal of a receivable under a tax sharing agreement with an unrelated party. The $23 million charge is offset by a tax benefit as described in note (3) below. For the three months and year ended December 31, 2013, merger and strategic initiatives expense primarily related to our acquisitions of the TR Corporate businesses and eSpeed, offset by a credit of $23 million associated with a receivable under a tax sharing agreement with an unrelated party. The $23 million credit is offset by a tax expense as described in note (3) below. Merger and strategic initiatives costs for the year ended December 31, 2013 were partially offset by the remeasurement of a contingent purchase price liability related to the BWise acquisition due to changes in the anticipated performance of BWise.
 
(3) For the three months and year ended December 31, 2014, includes $23 million associated with the recognition of a previously unrecognized tax benefit. This amount is offset by the reversal of the receivable described in note (2) above. For the three months and year ended December 31, 2013, includes $23 million associated with the derecognition of a previously recognized tax benefit. This amount is offset by the receivable described in note (2) above.
 
(4) Non-GAAP operating margin equals non-GAAP operating income divided by total revenues less transaction-based expenses.
           
The NASDAQ OMX Group, Inc.
Reconciliation of 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 Year Ended
  December 31, September 30, December 31, December 31, December 31,
   2014  2014  2013  2014  2013
           
GAAP operating expenses  $ 344  $ 290  $ 282  $ 1,313  $ 1,207
           
Non-GAAP adjustments:          
           
Merger and strategic initiatives (1)  (35)  (5)  11  (81)  (22)
Sublease loss reserves  (11)  --   --   (11)  -- 
Extinguishment of debt  (2)  --   --   (11)  -- 
Voluntary accommodation program  --   --   18  --   (44)
Special legal expenses  --   --   (1)  (2)  (3)
Securities and Exchange Commission matter  --   --   --   --   (10)
Restructuring charges  --   --   --   --   (9)
Other  --   (1)  3  (2)  3
Total non-GAAP adjustments  (48)  (6)  31  (107)  (85)
           
Non-GAAP operating expenses  $ 296  $ 284  $ 313  $ 1,206  $ 1,122
           
           
(1) For the three months and year ended December 31, 2014, merger and strategic initiatives expense primarily related to our acquisitions of the TR Corporate businesses and eSpeed and a charge of $23 million related to the reversal of a receivable under a tax sharing agreement with an unrelated party. For the three months and year ended December 31, 2013, merger and strategic initiatives expense primarily related to our acquisitions of the TR Corporate businesses and eSpeed, offset by a credit of $23 million associated with a receivable under a tax sharing agreement with an unrelated party. Merger and strategic initiatives costs for the year ended December 31, 2013 were partially offset by the remeasurement of a contingent purchase price liability related to the BWise acquisition due to changes in the anticipated performance of Bwise.
           
The NASDAQ OMX Group, Inc.
Quarterly Key Drivers Detail
(unaudited)
 
  Three Months Ended
  December 31, September 30, December 31,
   2014  2014  2013
Market Services      
Equity Derivative Trading and Clearing      
U.S. Equity Options      
Total industry average daily volume (in millions) 16.1 14.7 14.7
Nasdaq PHLX matched market share 16.2% 16.3% 17.6%
The NASDAQ Options Market matched market share 9.7% 9.5% 9.1%
Nasdaq BX Options Market matched market share 0.7% 0.8% 0.8%
Total matched market share executed on Nasdaq's exchanges 26.6% 26.6% 27.5%
       
Nasdaq Nordic and Nasdaq Baltic Options and Futures      
Total average daily volume options and futures contracts(1) 379,604 325,950 350,012
       
Cash Equity Trading      
Total U.S.-listed Securities      
Total average daily share volume (in billions)  7.00  5.68  6.01
Matched share volume (in billions)  90.8  71.1  74.1
Matched market share executed on NASDAQ 17.6% 16.6% 16.1%
Matched market share executed on Nasdaq BX 2.0% 2.5% 2.6%
Matched market share executed on Nasdaq PSX 0.7% 0.5% 0.5%
Total matched market share executed on Nasdaq's exchanges 20.3% 19.6% 19.2%
Market share reported to the FINRA/NASDAQ Trade Reporting Facility 30.2% 32.3% 33.1%
Total market share(2) 50.5% 51.9% 52.3%
       
Nasdaq Nordic and Nasdaq Baltic Securities      
Average daily number of equity trades 390,302 303,902 309,756
Total average daily value of shares traded (in billions)  $ 4.8  $ 4.0  $ 4.4
Total market share executed on Nasdaq's exchanges 69.6% 72.2% 68.3%
       
Fixed Income, Currency and Commodities Trading and Clearing      
U.S. Fixed Income      
Total average daily volume On the Run U.S. Treasury contracts (in billions)  223.4 214.2 193.5
Total market share 30.0% 33.6% 34.4%
       
Nasdaq Nordic and Nasdaq Baltic Fixed Income      
Total average daily volume fixed income contracts  98,284  76,134  135,507
       
Nasdaq Commodities      
Power contracts cleared (TWh)(3) 413 376 436
       
Listing Services      
Initial public offerings      
NASDAQ 49 41 35
Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 20 5 8
       
New listings      
NASDAQ(4) 95 76 80
Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic(5) 23 8 14
       
Number of listed companies      
NASDAQ(6)  2,782  2,746  2,637
Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic(7)  792  778  758
       
Technology Solutions      
Market Technology      
Order intake (in millions)(8)  $ 193  $ 28  $ 139
Total order value (in millions)(9)  $ 704  $ 621  $ 660
       
       
(1) Includes Finnish option contracts traded on EUREX Group.
(2) Includes transactions executed on NASDAQ's, Nasdaq BX's and Nasdaq PSX's systems plus trades reported through the FINRA/NASDAQ Trade Reporting Facility. 
(3) Primarily transactions executed on Nord Pool 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 funds (ETFs).
(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 listed companies for NASDAQ at period end, including separately listed ETFs.
(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. 
CONTACT: MEDIA RELATIONS CONTACT:

         Joseph Christinat

         +1.646.441.5121

         joseph.christinat@nasdaq.com



         INVESTOR RELATIONS CONTACT:

         Ed Ditmire, CFA

         +1.212.401.8737

         ed.ditmire@nasdaq.com

Nasdaq logo

Source: The NASDAQ OMX Group, Inc.

News Provided by Acquire Media