Nasdaq (NDAQ) 2025 Conference Transcript

Nasdaq (NDAQ) 2025 Conference Summary Industry Overview - Nasdaq is a global exchange operator that has been transforming its business model to become a technology and platform provider for corporates, investment managers, and financial institutions [2][3] Key Points and Arguments Market Dynamics - The first half of 2025 has seen significant market volatility, with record volumes in equity options in April, followed by normalization in May [5][6] - Nasdaq reported record-breaking statistics on trading volumes, including 100 million options contracts and 31 billion shares in equities on Liberation Day [8] - The exchange managed over 550 billion messages in a single day, showcasing its operational resilience [10] - The Nasdaq index has shown a recovery, up 2.5% year-to-date after being down 20% earlier [12] - European markets, which Nasdaq operates in, are outperforming U.S. markets, indicating strong performance across its international operations [13] Retail Participation - Retail participation in the markets remains strong, particularly in equities and options, with foreign retail ownership of U.S. equities doubling over the past five years [14][15] - Retail investors are described as more sophisticated, utilizing better tools and information compared to previous years [16] 24/5 Trading Initiative - Nasdaq plans to launch 24/5 trading by the second half of 2026, driven by demand from retail investors, particularly from North Asia [17][18] - The initiative aims to harmonize trading hours across exchanges while ensuring market integrity and transparency [19][20] - Operational challenges include staffing, managing corporate actions, and ensuring liquidity during extended trading hours [27][28] Strategic Pivot Towards Information Services - Nasdaq has been pivoting towards information services since 2017, focusing on financial technology and risk management solutions [29][30] - The company has made several acquisitions to enhance its portfolio, including regulatory technology and financial crime management solutions [34] - Nasdaq aims to be a trusted partner for clients, helping them navigate increasing complexity in the financial landscape [33] Demand for Regulatory and Risk Management Solutions - Acxiom, a regulatory technology solution, is positioned to capitalize on global modernization efforts in banking systems [41][42] - Surveillance solutions are benefiting from increased trading activity in crypto and heightened regulatory scrutiny across asset classes [44][45] AI Integration - Nasdaq is embedding AI capabilities into its products, such as the XVA accelerator in Calypso, which significantly reduces computation time for complex derivatives [61][65] - AI is expected to enhance both product offerings and operational efficiencies, improving client satisfaction [62] Digital Assets Strategy - Nasdaq is actively involved in the digital asset space, offering trading and surveillance technology, and listing ETFs related to crypto [70] - The company sees opportunities in collateral management for digital assets, aiming to integrate traditional finance with digital rails [72][74] Other Important Insights - Nasdaq's operational resilience has been tested during periods of high volatility, and the company has successfully managed record trading volumes [10][11] - The strategic focus on technology and information services positions Nasdaq well for future growth in a rapidly evolving financial landscape [34][35] - The integration of AI and digital asset strategies reflects Nasdaq's commitment to innovation and adapting to market demands [61][70]