Summary
NASDAQ OMX Group, Inc. (NDAQ) reported its financial results for the third quarter and first nine months ended September 30, 2009. Total revenues for the third quarter decreased by 18.4% to $810 million, and for the first nine months by 1.2% to $2.59 billion, compared to the prior year periods. This decline was largely driven by a decrease in Market Services revenues, particularly in U.S. cash equity trading, reflecting lower matched share volume and average net fee per share. However, the company saw improvements in its Market Technology segment. Despite the revenue dip, the company managed operating expenses effectively, resulting in a decrease in operating expenses for the third quarter and a smaller increase for the nine-month period, partly due to favorable foreign exchange movements and successful integration of recent acquisitions. Net income attributable to NASDAQ OMX for the third quarter was $60 million, a slight increase from $58 million in the prior year, but net income for the first nine months decreased to $223 million from $279 million in the prior year. Diluted EPS for the third quarter was $0.28, up from $0.27, while for the nine months it decreased to $1.05 from $1.40. The company's financial condition remained solid, with total assets at $12.34 billion and total equity at $4.97 billion. Liquidity was supported by $311 million in cash and cash equivalents. Significant balance sheet items include a substantial amount of goodwill ($4.92 billion) and intangible assets ($1.68 billion) stemming from past acquisitions. The company also completed the conversion of most of its 3.75% convertible notes into common stock, incurring a debt conversion expense. Management highlighted ongoing efforts to adapt to a competitive market, including fee structure revisions and a focus on technology and global market presence.
Financial Highlights
27 data points| Revenue | $810.00M |
| Cost of Revenue | $461.00M |
| Gross Profit | $349.00M |
| Operating Expenses | $218.00M |
| Operating Income | $131.00M |
| Interest Expense | $26.00M |
| Net Income | $60.00M |
| EPS (Basic) | $0.10 |
| EPS (Diluted) | $0.09 |
Key Highlights
- 1Total revenues for Q3 2009 decreased to $810 million from $990 million in Q3 2008, primarily due to a decline in Market Services revenue.
- 2Net income attributable to NASDAQ OMX for Q3 2009 was $60 million, a slight increase from $58 million in Q3 2008. Diluted EPS was $0.28, up from $0.27.
- 3Operating expenses decreased by 4.0% in Q3 2009 to $218 million, aided by foreign exchange benefits and lower compensation costs.
- 4The Market Technology segment showed strong revenue growth of 24.1% in Q3 2009, indicating successful performance in this area.
- 5The company effectively managed debt, with total debt obligations decreasing to $2.09 billion by September 30, 2009. Most 3.75% convertible notes were converted to common stock.
- 6Goodwill and intangible assets remain significant on the balance sheet, totaling approximately $4.92 billion and $1.68 billion, respectively, reflecting past acquisitions.
- 7The company continues to adapt to market dynamics, introducing revised fee structures and focusing on integration of acquisitions to drive future performance.