CME Group’s Q2 Profit Jumps 1.4% despite Marginal Revenue Dip

The exchange operator reported revenue of $1.17 billion and a net profit of $510.6 million.

CME Group (Nasdaq: CME), which is the operator of one of the largest US derivatives exchanges, reported on Wednesday an increase of 1.4 percent in its net income for the second quarter of 2020, which came in at $510.6 million. Diluted earnings per share strengthened to $1.42.

The latest financials revealed that the revenue of the exchange operator dropped marginally year-over-year to $1.17 billion from $1.18 billion. Out of the total, $929.9 million came from clearing and transaction fees, while CME’s market data and information services generated $145.2 million.

However, the figure dropped from $574.4 million in profits generated in the first quarter with a revenue of $1.25 billion.

The operating income for the recent quarter came in at $674.7 million, which is a prominent jump from last year’s $637.5 million. It was achieved as the company reduced expenses in almost all segments.

On an adjusted basis, the net income of the company stood at $589 million with diluted earnings per share at $1.64.

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Trading Volume Increased

“As economies continued to recover during the first half of the year, trading increased across a majority of our asset classes,” said Terry Duffy, CME Group Chairman and CEO. Indeed, the average daily trading volume on the exchange jumped by 5 percent in Q2 of 2021 with 18.4 million contracts.

Moreover, the Chicago-headquartered company strengthened its product line in the quarter, introducing micro-sized contracts and also ESG-focused futures contracts.

Meanwhile, the CME Group is in the process of merging its post-trading services with London-based IHS Markit for the formation of a joint venture. The companies have already received approvals from regulators to close the deal.

“Looking ahead, we will continue to support our clients’ evolving trading needs through additional product innovation and the upcoming launch of our joint venture company to provide post-trade services for OTC markets,” Duffy added.

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