By Prakhar Srivastava
(Reuters) -Intercontinental Exchange beat Wall Street estimates for third-quarter profit on Thursday, lifted by robust trading activity and steady growth in its fixed income and data services unit.
Market volatility typically boosts exchange activity, as investors increase trades to adjust portfolios and hedge risks.
During the reported quarter, traders actively reshuffled portfolios as they navigated expectations over the Federal Reserve’s interest rate cuts, shifting U.S.
trade policies and a boom in AI-linked shares.
Revenue from ICE’s exchange business – its largest segment which includes the New York Stock Exchange – was up 1% at $1.27 billion for the third quarter, while revenue from energy-related trading rose 2% to $482 million.
“Overall, a solid print, with exchange data and Fixed Income & Data Services fueling the top-line beat, good expense control and better-than-expected capital returns,” Citi analyst Christopher Allen said in a note.
Fixed income and data services revenue climbed 5% and mortgage technology revenue increased 4%.
ICE’s data and mortgage technology units have provided steady revenue streams alongside its core trading business.
The company reported adjusted earnings of $980 million, or $1.71 per share, beating analyst expectations of $1.61 per share, according to data compiled by LSEG.
Shares of ICE were up 0.4% in late-morning trading.
The exchange operator, like its peers, is expanding beyond traditional trading platforms into retail-focused and digital asset ventures to diversify.
Earlier this month, ICE said it would invest $2 billion in predictions market platform Polymarket.
The move follows CME’s tie-up with sports betting firm FanDuel and Nasdaq’s recent investment in crypto exchange Gemini.
“We believe Polymarket’s engineering team can help ICE’s engineers better understand our own adoption of evolving banking technology, a relationship that is already paying dividends to both of us,” CEO Jeff Sprecher said in a conference call post earnings.
(Reporting by Prakhar Srivastava in Bengaluru; Editing by Leroy Leo)
