01—Abstract
Summary
Summary of the 10-K filed February 21, 2024. Cited figures are marked; the original filing is the authoritative source.
Nasdaq, Inc. (NDAQ) reported a strong performance in its 2023 fiscal year, driven significantly by the strategic acquisition of Adenza.
The company's revenue, less transaction-based expenses, increased by 8.7% year-over-year to $3.9 billiona. This growth was primarily fueled by the Financial Technology segment, which saw a substantial 27.2% revenue increase, largely attributable to the integration of Adenza's solutions. The Capital Access Platforms segment also demonstrated steady growth, with a 5.2% increase in revenue, supported by robust performance in Index and Workflow & Insights.
While operating expenses rose by 14.8%, largely due to integration and restructuring costs related to the Adenza acquisition, operating income remained stable. Net income attributable to Nasdaq saw a slight decrease of 5.9% to $1.06 billionb, resulting in diluted earnings per share of $2.08.
The company also actively managed its capital, with significant proceeds from debt issuance for the Adenza acquisition and continued share repurchases and dividend payments to shareholders. Nasdaq's strategic focus on technology, including AI and cloud migration, positions it for continued growth in the evolving financial landscape.
02—Key points
Key Highlights
- Revenue less transaction-based expenses increased by 8.7% to $3.9 billion in 2023.
- The Financial Technology segment experienced a significant revenue surge of 27.2%, driven by the acquisition of Adenza.
- Capital Access Platforms segment revenue grew by 5.2%, with strong contributions from Index and Workflow & Insights.
- Operating income remained largely stable at $1.6 billion, despite a 14.8% increase in operating expenses primarily due to acquisition-related costs.
- Net income attributable to Nasdaq decreased by 5.9% to $1.06 billion, with diluted EPS at $2.08.
- The company successfully integrated the Adenza acquisition, which was a key strategic move for expanding its technology solutions.
- Nasdaq continues to invest in AI and cloud migration, aiming to enhance its product offerings and operational efficiency.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2023, Nasdaq, Inc. kept $0.17.
- Revenue$6.06B100.0%
- Cost of revenue−$2.17B35.8%
- Gross profit$3.90B64.2%
- Operating costs−$2.32B38.2%
- Operating income$1.58B26.0%
- Interest, other & tax−$519.0M8.6%
- Net income$1.06B17.5%
Where FY2023 revenue went
$6.06B- Operating costs: $2.32B, 38% of revenue
- Cost of revenue: $2.17B, 36% of revenue
- Net income: $1.06B, 17% of revenue
- Interest, other & tax: $519.0M, 8.6% of revenue
Kept 17% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2023filed February 21, 2024Financial Statements
FY2023 against FY2022
| Line item | FY2023FY2022 | Change |
|---|---|---|
| Revenue | $6.06B$6.23B | −2.6% |
| Cost of Revenue | $2.17B$2.64B | −18.0% |
| Gross Profit | $3.90B$3.58B | +8.7% |
| Operating Expenses | $2.32B$2.02B | +14.8% |
| Operating Income | $1.58B$1.56B | +0.9% |
| Interest Expense | $284.00M$129.00M | +120.2% |
| Net Income | $1.06B$1.13B | −5.9% |
| EPS (Basic) | $2.10$2.28 | −7.9% |
| EPS (Diluted) | $2.08$2.26 | −8.0% |
| Shares Outstanding (Basic) | 504.91M492.42M | +2.5% |
| Shares Outstanding (Diluted) | 508.39M497.86M | +2.1% |
05—Questions
Frequently Asked Questions
What was the primary driver of Nasdaq's revenue growth in 2023?
The primary driver of Nasdaq's revenue growth in 2023 was the strategic acquisition of Adenza, which significantly boosted the Financial Technology segment's performance. Overall revenue less transaction-based expenses increased by 8.7%.
How did the Adenza acquisition impact Nasdaq's financial results?
The Adenza acquisition, completed in November 2023, significantly contributed to the 27.2% revenue growth in the Financial Technology segment. While it led to an increase in operating expenses due to integration and restructuring costs, it is expected to provide substantial long-term synergies and enhance Nasdaq's technology solutions.
What is Nasdaq's outlook regarding technology investments, particularly AI and cloud?
Nasdaq is heavily investing in artificial intelligence (AI), including generative AI, and cloud migration (in partnership with AWS). These initiatives are aimed at developing new products, enhancing existing offerings, modernizing markets, and improving operational efficiency to maintain a competitive advantage and better serve clients.
What is Nasdaq's approach to managing its capital structure and returning value to shareholders?
Nasdaq strategically manages its capital by balancing acquisitions, internal investments, debt management, share repurchases, and dividend payments. The company issued debt to finance the Adenza acquisition and continued its share repurchase program and dividend payments throughout 2023.
06—Continue