Nasdaq Q1 2019 Revenues Slump YoY, But Income Remains Solid

Net revenues fell $32 million year-on-year.

Following on from a solid final quarter of last year, Nasdaq has released its financial results for the first quarter of this year, revealing a year-on-year drop of $32 million in net revenues.

For the first quarter of 2019, net revenues for the US-based exchange operator came in at $634 million. This is down by 4.8 percent when compared to the same time period of 2018, which achieved net revenues of $666 million.

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Contributing to net revenues was a 3 percent, or $22 million impact from organic growth. It also reflects a positive $11 million impact from the inclusion of revenues from the acquisitions of Cinnober and Quandl. However, this was offset by a $50 million loss from the divestiture of its Public Relations Solutions and Digital Media Services businesses, as well as a $15 million expense due to unfavorable foreign exchange (forex) rates.

GAAP (Generally Accepted Accounting Principles) operating expenses for the quarter was $359 million. This is lower than the first quarter of 2018 by $34 million or 8.65 percent, which had operating expenses of $393 million.

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Fixed Income and Commodities Revenue Falls in Q1 of 2019

Following a similar trend, fixed income and commodities trading and clearing revenues also fell on a year-on-year basis. Specifically, net revenues for the segment was $19 million in Q1 of 2019, which is lower by 4 million year-on-year.

The decline was largely due to a drop in revenues related to US fixed income, as well as an unfavorable impact from changes in FX rates, which cost the company $2 million. Overall, fixed income and commodities trading and clearing revenues contribute 3 percent to total revenues.

Adena Friedman, CEO of Nasdaq
Adena Friedman, the CEO of Nasdaq

Commenting on the results, Adena Friedman, President and CEO of Nasdaq said: “I am pleased that we delivered solid revenue growth in the Market Technology and Information Services segments during the first quarter of 2019, even as capital market conditions presented certain headwinds in the form of lower industry trading and IPO volumes.”

“At the same time, we are leveraging our leadership role in the U.S. equities markets to propose structural improvements to modernize the marketplaces to benefit both issuers and investors, and we look forward to constructive dialogue with critical stakeholders in the periods ahead.”

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