A month has gone by since the last earnings report for Nasdaq (NDAQ). Shares have lost about 1.6% in that time frame, underperforming the S&P 500.
But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Nasdaq due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
NDAQ Q3 Earnings & Revenues Top Estimates, Expense View Tweaked
Nasdaq, Inc, reported third-quarter 2025 adjusted earnings per share of 88 cents, which beat the Zacks Consensus Estimate by 4.8%. The bottom line improved 18.9% year over year. The improvement was mainly driven by higher revenues across three divisions and organic growth, partially offset by higher expenses.
Performance in Detail
Nasdaq’s net revenues of $1.3 billion increased 15% year over year. Organic net revenue growth was 11%. The top line beat the Zacks Consensus Estimate by 1.7%. Annualized Recurring Revenue (ARR) increased 10% year over year to $3 billion. Organic growth was 9%. Annualized SaaS revenues increased 12% and represented 38% of ARR. Capital Access Platforms' revenues, adjusted, were $546 million, up 9% year over year. The increase was primarily driven by higher revenues from all business lines. Our estimate was $531.1 million.
Financial Technology revenues, adjusted, were $457 million, up 23.2%, also driven by higher revenues from all business lines. Our estimate was $421.8 million. Revenues at the Solutions business increased 15% year over year to $1 billion, reflecting strong growth from Index and Financial Technology. Market Services' net revenues increased 7.4% year over year to $303 million. Our estimate was $294 million.
Adjusted operating expenses were $583 million, up 7.4% from the year-ago period or 5% growth on an organic basis. The organic increase for the quarter reflected increased investments in technology and people to drive innovation and long-term growth, partially offset by the benefit of synergies. Our estimate for operating expenses was $581.6 million.
Adjusted operating income of $732 million was up 14.9% year over year. Our estimate was $674.4 million. The company’s operating margin of 56% expanded 200 basis points year over year. The Nasdaq stock market welcomed 205 new company listings, including 76 initial public offerings. The number of listed companies was 4,359 at the end of the quarter.
Financial Update
Nasdaq had cash and cash equivalents of $697 million as of Sept. 30, 2025, which increased 11.9% from the end of 2024. Long-term debt was $8.7 billion as of Sept. 30, 2025, a decrease of 4.6% from the end of 2024. Nasdaq generated $221 million in cash flow from operations in the reported quarter.
Capital Deployment
Nasdaq returned $155 million to shareholders through dividends, repurchased $115 million of common stock, and repurchased $69 million of senior unsecured notes in the third quarter of 2025. The board of directors approved a dividend of 27 cents per share. The dividend will be paid out on Dec. 19, 2025, to shareholders of record at the close of business on Dec. 5, 2025. As of Sept. 30, 2025, $1.4 billion remained under the board-authorized share repurchase program.
2025 Guidance
Nasdaq expects 2025 non-GAAP operating expenses to be in the range of $2,305-$2,335 million compared with $2,295-$2,325 million guided earlier.
Nasdaq forecasts the 2025 non-GAAP tax rate to be in the range of 22.5-23.5%.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a upward trend in estimates revision.
VGM Scores
At this time, Nasdaq has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, the stock has a grade of D on the value side, putting it in the bottom 40% for value investors.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Nasdaq has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Nasdaq, Inc. (NDAQ): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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