Stock Markets

Nasdaq profit beats expectations, helped by anti-financial crime unit


© Reuters. FILE PHOTO: The Nasdaq logo is displayed at the Nasdaq Market site in New York, U.S., May 2, 2019. REUTERS/Brendan McDermid

(Reuters) -Nasdaq Inc on Wednesday reported first-quarter profits that beat Wall Street estimates as demand for its anti-financial crime software helped mitigate a hit to the exchange operator’s indexing business and a slump in initial public offerings.

Nasdaq expanded its regulatory technology footprint with its recent $2.75 billion Verafin acquisition and has made the business a key pillar of its corporate structure, which last quarter was split into three divisions – anti-financial crime (AFC), market platforms and capital access platforms.

The exchange operator, which already has around 2,500 banks and credit unions using its AFC cloud-based platform to help detect, investigate, and report money laundering and financial fraud, said it signed up its first big Tier 1 bank, which holds over $1 trillion in assets, in April.

“Getting to that first Tier 1 win has been a very important milestone for us because now that we can prove ourselves there, it will make it easier for other banks to say, ‘Okay, I’m not taking a risk here, I’m actually taking a proven solution,'” Nasdaq Chief Executive Adena Friedman said on an analysts’ call.

Revenue from the AFC unit jumped nearly 17% from a year earlier to $84 million.

Net trading services revenues rose 1% to $267 million as rising interest rates, persistently high inflation and the banking crisis boosted volatility and trading levels.

Revenue from Nasdaq’s indexes, which are widely referenced by exchange-traded products and provide the company with licensing fees, slumped 9.8% to $110 million.

Excluding one-time items, Nasdaq earned 69 cents per share, three cents above analysts’ mean estimate, according to Refinitiv data.

Nasdaq’s main exchange hosted 40 IPOs in the quarter, versus 70 a year earlier, as market volatility kept private companies on the sidelines.

Net revenue, excluding transaction-based expenses, rose 2% to $914 million.

Fed’s Barkin Wants More Evidence Inflation Is Easing to 2% Goal

Previous article

Glencore raises pressure on Teck Resources with promise of sweeter bid

Next article
BYStudy
As a seasoned financier, I have a keen eye for identifying profitable investment opportunities and creating strategic financial plans. My expertise in risk management and financial analysis has enabled me to deliver exceptional returns for my clients and stakeholders.

You may also like

Leave a reply

Your email address will not be published. Required fields are marked *