📢 Earnings Summary — CBOE

Cboe delivered record Q3 results with broad-based double-digit growth across Derivatives, Cash & Spot, and Data Vantage, while expanding margins and lifting revenue guidance. Robust demand for SPX and 0DTE products, strength in European equities, and steady FX gains anchored performance. Management announced a strategic realignment to focus on core derivatives and data franchises, initiating sales of the Australia and Canada units and exiting corporate listings, with expected earnings accretion and lower operating expenses over time. Balance sheet strength, a Moody’s upgrade, and higher dividends underscore financial flexibility. Near-term outlook remains constructive despite softer VIX and futures volumes, with secular tailwinds from retail and international expansion. Execution and regulatory approvals for product launches and divestitures remain key watch items.

📈 Growth Highlights

• Net revenue +14% y/y to record $605.5M; adjusted diluted EPS +20% y/y to record $2.67
• All categories posted double-digit growth: Derivatives Markets +15%; Cash & Spot Markets +14%; Data Vantage +12%
• Options segment net revenue +19%; total options ADV +26% (index +15%, multi-list +31%)
• SPX ADV +26% to record 3.9M; SPX 0DTE ADV +62% y/y; 0DTE share 61% (from 48%)
• Mini-SPX ADV +66%; 0DTE now ~50% of Mini-SPX (from 35%)
• Europe & APAC net revenue +24% y/y (transactions +35%; non-transaction +14%); fifth straight quarter leading segment growth
• Global FX net revenue +13% y/y; ADNV +3% and net capture +9%; 17 of last 18 quarters grew y/y
• North American Equities net revenue +6% y/y; access & capacity fees +10%
• Record day Oct 10: 6.4M SPX contracts; 33.2M total options traded
• Data Vantage growth driven ~90% by new unit/new sales rather than pricing

🔨 Business Development

• Initiated sale processes for Cboe Australia and Cboe Canada equities businesses
• Discontinued U.S. and European Corporate Listings; reduced costs in U.S./EU ETP Listings, Cboe Europe Derivatives Exchange, and select Risk & Market Analytics
• Wind-down of Japanese Equities included in forward run-rate impacts
• Announced MAG 10 index options and futures (AI/tech exposure), pending regulatory approval
• Expanded Data Vantage offerings (Dedicated Cores, Timestamping) with strong uptake
• Continued onboarding of international brokers seeking exposure to U.S. markets
• Strengthened leadership bench; appointed JJ Kinahan as Head of Retail Expansion & Alternative Investment Products

💵 Financial Performance

• Adjusted operating expenses $210M (+3% y/y); disciplined expense control
• Adjusted operating EBITDA $409M (+21% y/y); EBITDA margin 67.5% (+380 bps)
• Futures net revenue −22% y/y on lower volumes
• Portfolio realignment expected to be EPS accretive; at steady state implies ~3% lower net revenue and 8–10% lower adjusted opex vs 2025 guided ranges
• Recognized $45.6M GAAP gain on Trading Technologies investment (excluded from non-GAAP); additional gain expected in Q4 (to be excluded)
• Raised FY25 total organic net revenue growth outlook to low double digit to mid-teens
• Raised Data Vantage organic growth outlook to high single digit to low double digit
• Lowered FY25 adjusted opex guidance to $827–$842M; CapEx to $73–$83M; D&A to $50–$54M
• Effective tax rate on adjusted earnings 28.5%–30.5%; Q4 net interest expense expected ≈$3M

🏦 Capital & Funding

• Adjusted cash ~$1.5B; leverage ratio 1.0x
• Moody’s upgraded credit rating to A2
• Returned $76M via $0.72/share dividend (+14% y/y)
• Emphasis on balanced capital deployment and margin efficiency

🧠 Operations & Strategy

• Strategic pivot to core strengths: index and multi-list options, futures, U.S./European equities, FX, and Data Vantage
• Resource reallocation and cost reductions to prioritize highest-return opportunities; realignment to be accretive to earnings
• Focus on product innovation and market structure advantages (e.g., 0DTE ecosystem; cash-settled, European-style contracts)
• Building retail-oriented capabilities, including digital crypto and event-contract initiatives
• Ongoing international expansion through broker onboarding

🌍 Market Outlook

• Positive outlook for derivatives as clients hedge amid trade tensions, potential government shutdown, and macro uncertainty
• Secular tailwinds from rising retail participation and global access to U.S. markets
• Expect continued momentum in 0DTE and index options; VIX complex softer in low realized volatility
• European cash equities expected to remain strong; Data Vantage pipeline supported by new sales rather than pricing
• Further updates on realignment timing and impacts to be provided with 2026 guidance

⚠ Risks & Headwinds

• Intense competition in multi-list options may pressure market share and capture
• Lower realized volatility weighing on VIX and futures volumes
• Execution and timing risk in divestitures and cost reductions; realization of run-rate benefits may lag
• Regulatory approval risks for MAG 10 products and Trading Technologies transaction closing
• Steady-state realignment reduces reported net revenue (~3%), despite earnings accretion

AI-generated earnings recap sourced from company results & conference call observations. Not investment advice — verify with official filings.