10-QPeriod: Q3 FY2010

NASDAQ, INC. Quarterly Report for Q3 Ended Sep 30, 2010

Filed November 3, 2010For Securities:NDAQ

Summary

NASDAQ OMX Group, Inc. reported solid financial performance for the nine months ended September 30, 2010, with revenues less liquidity rebates, brokerage, clearance and exchange fees increasing by 3.4% to $1,121 million. Net income attributable to NASDAQ OMX was $258 million for the same period, a notable increase from $223 million in the prior year. The company demonstrated strong operational efficiency, with operating income remaining stable year-over-year at $455 million despite increased operating expenses, which were impacted by strategic initiatives and debt refinancing charges. The company also strengthened its balance sheet by issuing new debt and repaying existing credit facilities, while continuing to return capital to shareholders through its share repurchase program.

Financial Highlights

55 data points
Beta

Revenue

$757.00M

49.1% Gross Margin

Net Income

$101.00M

13.3% Net Margin

EPS (Diluted)

$0.17

Total Assets

$10.36B

Cash & Equivalents

$336.00M

Free Cash Flow

$22.00M

Financial Statements
Beta
Revenue$757.00M
Cost of Revenue$385.00M
Gross Profit$372.00M
Operating Expenses$207.00M
Operating Income$165.00M
Interest Expense$25.00M
Net Income$101.00M
EPS (Basic)$0.17
EPS (Diluted)$0.17
Shares Outstanding (Basic)600.35M
Shares Outstanding (Diluted)612.22M

Key Highlights

  • 1Total revenues less liquidity rebates, brokerage, clearance and exchange fees increased by 3.4% year-over-year to $1,121 million for the nine months ended September 30, 2010.
  • 2Net income attributable to NASDAQ OMX grew to $258 million for the nine months ended September 30, 2010, up from $223 million in the prior year.
  • 3Operating income was stable at $455 million for the nine months ended September 30, 2010, compared to $455 million in the prior year, indicating effective operational management.
  • 4The company repaid significant debt obligations, including $1.7 billion of its senior secured credit facilities, and issued new senior unsecured notes and credit facilities totaling $1.7 billion in January 2010.
  • 5Share repurchase program remained active, with $300 million repurchased during the nine months ended September 30, 2010, demonstrating a commitment to returning capital to shareholders.
  • 6The company successfully integrated recent acquisitions, including SMARTS and Nord Pool ASA, contributing to diversification and strategic growth.
  • 7The company's Market Services segment remains the largest revenue contributor, showing resilience and growth despite market volatility.

Frequently Asked Questions

For the nine months ended September 30, 2010, NASDAQ OMX's revenues less liquidity rebates, brokerage, clearance and exchange fees increased by 3.4% to $1,121 million, compared to $1,084 million in the same period of 2009. This growth was primarily driven by increases in access services, derivative trading and clearing, and global index group revenues.

In January 2010, NASDAQ OMX significantly restructured its debt by issuing $1 billion in senior unsecured notes and entering into a $950 million senior unsecured credit facility. The proceeds were used to repay $1.7 billion of existing senior secured credit facilities. This move improved the company's debt profile and flexibility.

NASDAQ OMX has actively managed its capital resources. During the first nine months of 2010, the company repurchased $300 million of its outstanding common stock under its share repurchase program. Additionally, the company benefited from strong cash flow from operations, which supported its financial activities and investments.

The company completed several acquisitions, including SMARTS and Nord Pool ASA, in 2010. These acquisitions are expected to contribute to strategic diversification and growth, particularly in the Market Technology and Market Services segments. While the immediate financial impact is not detailed in the summary, they are integrated into the overall financial performance.