Nasdaq, Inc.

NDAQ · NASDAQ · USD

Can Nasdaq keep compounding subscription software and index revenue fast enough to offset slow enterprise installations, rising expenses and trading revenue that depends on market levels?

Last 4 earnings calls · through Q2 FY2026

Bull case

  • Recurring solutions revenue

    The bull case rests on Nasdaq becoming a subscription vendor, with recurring solutions revenue dominating the mix and growing faster than the rest of the company.

  • Listings and index link

    Its listing and index franchises reinforce each other: landmark IPOs deepen the pool of companies whose shares track Nasdaq benchmarks and pay asset-based fees.

  • New market infrastructure

    Management is turning regulatory approvals on extended trading hours and tokenized shares into dated launches, which bulls treat as real revenue potential.

Bear case

  • Revenue tied to market levels

    Much of the recent acceleration came from asset values and trading volumes rather than pricing, so revenue would slow if markets fell or volumes normalized.

  • Slow enterprise installations

    The financial-crime enterprise push is signed but slow to install, so revenue keeps arriving later than management's earlier comments implied.

  • Rising expense guidance

    Expense guidance has been raised more than once this year and the share count is higher than before the Adenza deal, so per-share gains rely on revenue outrunning both.

  • Trading fee capture

    Trading revenue depends on volume and on a fee capture rate that new off-exchange venues keep pressing, so growth there is only partly within management's control.

Bull and bear points

Growth & Execution

In short: Solutions revenue grows fast, but financial-crime deals install slowly and index fees track market levels.

Bull · 2

  • Nasdaq captured most of the largest U.S. IPOs of 2026

    Landmark listings such as SpaceX raise Nasdaq's standing with issuers and feed listing fees, index inclusion and data sales, so a strong IPO year compounds across divisions.

    Q2 FY2026 call

  • Tokenized equities moved from concept to a dated launch

    A year ago management described tokenization as a staged experiment with no timetable; it now points to a Kraken-linked launch early next year and a Nasdaq token design, which would add a new settlement-related revenue line.

    Tone shiftQ3 FY2025 → Q2 FY2026
Bear · 1

  • Enterprise financial-crime deals take a year to reach revenue

    Management once expected large Verafin signings to lift revenue within a quarter or two; it now says installation runs about a year, so growth from last year's record signings keeps sliding to the right.

    Tone shiftQ3 FY2025 → Q2 FY2026

Profitability & Financial Strength

In short: Margins and cash flow are strong, but expense guidance keeps rising and share count grew with Adenza.

Bull · 2

  • Earnings and revenue estimates beaten in each of the last eight quarters

    Consistent beats reflect a business where recurring revenue arrives ahead of cost, and management has kept the gap between solutions growth and expense growth intact.

    Filed financials

  • Free cash flow funds deleveraging, buybacks and a higher dividend

    Leverage is near the target range and first-half repurchases already exceeded all of last year, so management can keep returning cash while still funding product investment.

    Q2 FY2026 call
Bear · 2

  • Expense guidance has been raised twice in six months

    In January management set a 2026 cost range it has since lifted twice, so the cost base grows alongside revenue and operating leverage depends on the top line holding.

    Tone shiftQ4 FY2025 → Q2 FY2026

  • Diluted share count is up since the Adenza acquisition

    Shares outstanding rose 16.2% over three years, so per-share profit must outgrow net income; buybacks are only now beginning to offset that issuance.

    Filed financials

Market Position

In short: Nasdaq leads in listings and index products, but trading fees face off-exchange pressure and volume cycles.

Bull · 2

  • Extended-hours trading now has regulatory approval and a launch date

    A year ago the launch depended on regulatory approval; the SEC has since cleared it and management targets December, adding trading hours and more demand for Nasdaq market data.

    Tone shiftQ4 FY2025 → Q2 FY2026

  • Nasdaq-100 licensing widened to BlackRock and State Street

    Two more large distributors now sell Nasdaq-100 products on the same fee terms as QQQ, which extends the index's reach without conceding pricing to competitors.

    Q1 FY2026 call
Bear · 2

  • Fee capture in U.S. options falls as trading venues multiply

    New consolidators and cheaper order flow lower what Nasdaq earns per contract, so record volumes produce less revenue per trade and the division depends on volume staying high.

    Q2 FY2026 call

  • Revenue fell sharply in the last prolonged market downturn

    Between 2001 and 2004 revenue dropped 37% and the operating margin fell to 1.5%, a reminder that listings, trading and asset-based fees can decline at the same time.

    Filed financials