Yahoo Finance Nasdaq's (NDAQ) Q4 Earnings Miss, Revenues Increase Y/Y
Nasdaq, Inc. NDAQ reported fourth-quarter 2022 adjusted earnings per share of 64 cents, missed the Zacks Consensus Estimate of 65 cents by nearly 1.5%. The bottom line remained unchanged year over year.
The improvement was mainly driven by organic growth and solid segmental performance.
Nasdaq, Inc. Price, Consensus and EPS Surprise
Nasdaq, Inc. price-consensus-eps-surprise-chart | Nasdaq, Inc. Quote
Performance in Detail
Nasdaq’s revenues of $906 million increased 2.3% year over year. The upside can primarily be attributed to $41 million positive impact from organic growth, including positive contributions from all segments. It was partially offset by an $18 million decrease from the impact of changes in FX rates and a $2 million decrease from the net impact of an acquisition and divestiture. The top line matched the Zacks Consensus Estimate.
Annualized Recurring Revenue (ARR) increased 8% year over year. Annualized SaaS revenues increased 13% and represented 36% of ARR.
Adjusted operating expenses were $460 million, up 6% from the year-ago period. The increase was driven by increased expenses associated with the continued investment in people and businesses and higher travel costs. It was partially offset by lower marketing and advertising expense because of lower capital markets activity and changes in FX rates.
Operating margin of 49% contracted 200 basis points year over year.
In 2022, the Nasdaq Stock Market featured six of the largest ten U.S. IPOs by capital raised, attracted 74% of all proceeds raised through the U.S. IPOs and welcomed 14 listing switches. In the Nordic and Baltic regions, Nasdaq maintained its leadership positioning with 38 IPOs.
Segment Details
Net revenues at Solutions Businesses were up 3% from the year-ago quarter to $652 million. This upside was largely driven by 5% positive impact from organic growth and $1 million increase from an acquisition. It was partially offset by a $10 million decrease from the impact of changes in FX rates.
Revenues at Trading Services increased 1% year over year to $253 million. The increase reflects 4% positive impact from organic growth, partially offset by an $8 million decrease from the impact of changes in FX rates.
Full-Year Update
Adjusted earnings per share of $2.66 missed the Zacks Consensus Estimate of $2.68. The bottom line improved 5.6% year over year.
Total revenues increased 5% from the year-ago quarter to $3.58 billion and matched the Zacks Consensus Estimate.
Financial Update
Nasdaq had cash and cash equivalents of $502 million as of Dec 31, 2022, up 27.7% from 2021-end level. Long-term debt decreased 1.6% from 2021-end level to $4.7 billion as of Dec 31, 2022.
Stockholder’s equity decreased 3.8% from 2021 end to $6.1 billion as of Dec 31, 2022.
Capital Deployment
The company returned $1,016 million of cash to shareholders in 2022, including $633 million in share repurchases and $383 million in dividends.
As of Dec 31, 2022, there was $650 million remaining under the board authorized share repurchase program.
Guidance
Nasdaq expects its 2023 non-GAAP operating expense guidance in the range of $1.77 billion to $1.85 billion.
The company forecast non-GAAP tax rate in the range of 24% to 26% in 2023.
Zacks Rank
Nasdaq currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
CME Group Inc. CME is slated to release fourth-quarter 2022 earnings on Feb 8. The Zacks Consensus Estimate for the fourth quarter is pegged at $1.90 per share, indicating an increase of 14.4% from the year-ago reported figure.
CME Group delivered an earnings surprise in each of the last four reported quarters.
American International Group, Inc. AIG is scheduled to release fourth-quarter 2022 earnings on Feb 15. The Zacks Consensus Estimate for the fourth quarter is pegged at $1.19 per share, indicating a decrease of 24.6% from the year-ago reported figure.
AIG delivered an earnings surprise in three of the last four reported quarters, while missing in one.
Cboe Global Markets, Inc. CBOE is set to release fourth-quarter 2022 earnings on Feb 3. The Zacks Consensus Estimate for the fourth quarter is pegged at $1.77, indicating an increase of 4.1% from the year-ago reported figure.
CBOE delivered an earnings surprise in three of the last four reported quarters, while missing in one.
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