Cboe(US:CBOE)2026-02-06 12:30Financial Performance - Cboe reported record net revenue of $671.1 million for Q4 2025, an increase of 28% compared to $524.5 million in Q4 2024[7]. - Diluted EPS for Q4 2025 reached $2.97, up 60% from $1.86 in Q4 2024; adjusted diluted EPS was $3.06, up 46%[5][9]. - Total revenues for the three months ended December 31, 2025, were $1,204.0 million, an increase of 8.8% compared to $1,107.6 million in 2024[37]. - Net income for the same period was $312.2 million, up 59.8% from $195.6 million in 2024[37]. - Operating income for the three months ended December 31, 2025, was $403.8 million, a 35.4% increase from $298.5 million in 2024[37]. - Basic earnings per share for the three months ended December 31, 2025, were $2.98, compared to $1.87 in 2024, representing a 59.6% increase[37]. - Adjusted diluted earnings per share for the twelve months ended December 31, 2025, was $10.67, compared to $8.61 for the same period in 2024, reflecting a 24.0% growth[43]. - Adjusted operating income for Q4 2025 was $450.5 million, an increase of 40.9% from $319.7 million in Q4 2024[43]. - Adjusted operating margin for the twelve months ended December 31, 2025, was 65.6%, compared to 61.4% in 2024, indicating a 4.2 percentage point improvement[43]. - Operating EBITDA for Q4 2025 was $403.8 million, with an operating EBITDA margin of 67.1%[45]. - Adjusted Operating EBITDA for the twelve months ended December 31, 2025, reached $1,645.1 million, compared to $1,316.9 million in 2024, reflecting a 25% growth[46]. Revenue Segments - Cboe's Derivatives business saw a net revenue growth of 38% year-over-year, while Cash and Spot Markets net revenue rose 27%[3]. - The cash and spot markets generated revenues of $431.3 million, while derivatives markets contributed $610.1 million, reflecting growth in both segments[37]. - Record Options net revenue was $433.1 million, up 34% from $324.3 million in Q4 2024, driven by a 24% increase in total options average daily volume[13]. - North American Equities net revenue increased 17% to $110.7 million, reflecting higher net transaction and clearing fees[13]. - Europe and Asia Pacific net revenue for Q4 2025 was $69.9 million, up from $56.2 million in Q4 2024, marking a 24.5% increase[47]. Expenses and Costs - The company's total operating expenses were $267.3 million in Q4 2025, an increase of 18% from $226.0 million in Q4 2024[9]. - Total cost of revenues decreased to $532.9 million from $583.1 million year-over-year, resulting in a gross profit increase[37]. - Adjusted operating expenses in 2026 are expected to be in the range of $864 to $879 million, excluding the expected amortization of acquired intangible assets of $63 million[18]. - Depreciation and amortization expense for 2026 is expected to be in the range of $56 to $60 million, excluding the expected amortization of acquired intangible assets[18]. Tax and Financial Position - Cboe's effective tax rate for Q4 2025 was 30.6%, up from 29.7% in Q4 2024, primarily due to remeasuring deferred tax assets and liabilities[9]. - The effective tax rate on adjusted earnings for the full year 2026 is expected to be in the range of 27.5 to 29.5 percent[18]. - The effective tax rate on adjusted earnings for the twelve months ended December 31, 2025, was 29.3%[43]. - The company had cash and cash equivalents of $2,216.5 million and total debt of $1,442.9 million as of December 31, 2025[15]. - Cash and cash equivalents increased significantly to $2,216.5 million from $920.3 million year-over-year, indicating strong liquidity[38]. - Total assets rose to $9,305.3 million, up from $7,789.1 million in 2024, reflecting growth in the company's financial position[38]. Market Share and Growth Expectations - Cboe's market share in U.S. Equities decreased to 9.4% in Q4 2025 from 10.8% in Q4 2024[13]. - Cboe anticipates total organic net revenue growth in the 'mid single-digit' range for 2026, with Data Vantage organic net revenue growth expected in the 'mid to high single-digit' range[3][5]. - Organic total net revenue growth is expected to be in the 'mid single-digit' range in 2026[18]. - Organic net revenue growth from Data Vantage is expected to be in the 'mid to high single-digit' range in 2026[18]. - Total industry ADV for options in Q4 2025 was 66,608 thousand, compared to 51,635 thousand in Q4 2024, reflecting a significant increase[27]. - Total Company Options ADV in Q4 2025 was 19,419 thousand, up from 15,673 thousand in Q4 2024[27]. - Total Options market share in Q4 2025 was 29.2%, compared to 30.4% in Q4 2024[27]. Impairments and Adjustments - The company incurred impairment of assets amounting to $25.1 million in Q4 2025, compared to no impairment in Q4 2024[46]. - Impairment of assets for the twelve months ended December 31, 2025, was $46.7 million, compared to $81.0 million in 2024[43]. - Acquisition-related costs for the twelve months ended December 31, 2025, totaled $0.3 million, down from $1.3 million in 2024[43]. - Total non-GAAP adjustments for Q4 2025 amounted to $1.6 million, while for the twelve months, it was $28.7 million[43].