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CHICAGO - On Friday, Cboe Global Markets (NYSE:CBOE) reported record third-quarter results that exceeded analyst expectations, and announced a strategic realignment of its business portfolio.
The company’s shares were up 2.19% in pre-market trading after the announcement.
The exchange operator posted adjusted earnings per share of $2.67, beating the analyst estimate of $2.51, while revenue reached a record $605.5 million, surpassing the consensus estimate of $588.64 million. Total net revenue grew 14% YoY, driven by strong performance across the company’s derivatives business.
Derivatives net revenue increased 15% compared to the third quarter of 2024, fueled by multiple quarterly volume records in the options business. Cash and spot markets revenue rose 14%, while Data Vantage revenue grew 12% YoY.
"Cboe produced a third consecutive quarter of record net revenue to drive record diluted EPS and adjusted diluted EPS," said Jill Griebenow, Executive Vice President and Chief Financial Officer. "Moving forward, we are increasing our 2025 organic total net revenue growth guidance range to ’low double-digit to mid-teens’ from ’high single-digit.’"
The company also announced a strategic realignment following a comprehensive review, which includes initiating sales processes for Cboe Australia and Cboe Canada, discontinuing U.S. and European corporate listings efforts, and reducing costs across several smaller business units.
"This strategic realignment of our business portfolio and human capital ensures Cboe is well positioned to succeed in a dynamic and evolving market and supports our long-term vision to be a global derivatives leader," said Craig Donohue, Chief Executive Officer.
Cboe expects the realignment to have an immaterial impact on its 2025 organic net revenue growth but estimates the annualized run-rate impact will result in approximately 3% reduction in net revenue and an 8-10% reduction in adjusted operating expenses.
The company lowered its full-year adjusted operating expense guidance to $827-$842 million from $832-$847 million previously, while raising its Data Vantage organic net revenue growth target to "high single-digit to low double-digit" from "mid to high single-digit."
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