NASDAQ OMX Group (NASDAQ:NDAQ) announced its Q4 earnings on Thursday, January 29, reporting 8% year-on-year growth in consolidated revenues to $919 million during the quarter. NASDAQ’s information services segment and listing revenues both witnessed a 5% y-o-y rise in revenues to $113 million and $61 million, respectively. On the other hand, revenues generated by technology solutions fell by 8% over the prior year quarter to $138 million. Market services, or transaction-based revenues, rose by 14% y-o-y to $607 million during the quarter driving much of the top-line growth. However, net trading revenues – excluding cost of revenues – were flat over the prior year period at $205 million due to higher transaction rebates and brokerage and clearance fees expenses incurred by NASDAQ.
The exchange operator had a strong start to 2014 in terms of trading activity across its platforms, with equity and derivatives trades in the U.S. boosting transaction-based revenues. However, as trading volumes declined in the second quarter, the company’s trading businesses suffered in both Europe and the U.S. NASDAQ’s non-transaction businesses, including market data, technology solutions and corporate services, drove revenues and profits in Q2. On the other hand, an improvement in trading volumes across equities and options in the U.S. helped drive trading revenues in the third quarter, even as volumes in Europe remained low. Trading business picked up further in Q4 across both Europe and the U.S. For the full year, NASDAQ’s consolidated revenues were up by 9% to $3.5 billion, with technology solutions revenues rising by over 19% y-o-y to $542 million. The information services segment witnessed an 8% growth for the full year to $473 million, while listing services only grew by about 4% to $238 million. Transaction-based revenues were up by over 7% to $2.2 billion for the full year. However, net trading revenues – excluding cost of revenues – were only about 4% higher than the previous year at $814 million. Read More »