CME Group Inc.

Welcome to the CME Group fourth quarter 2025 earnings call. At this time, I would like to inform all participants that your lines have been placed on a listen-only mode until the question and answer session of today's call. I would now like to turn the call over to Adam Minnick. Please go ahead.

Good morning, and I hope you're all doing well today. We released our earnings commentary earlier this morning, which provides extensive details on the fourth quarter and full year results for 2025. I will start with the Safe Harbor language, then I'll turn it over to Terry. Statements made on this call and in the other reference documents on our website that are not historical facts are forward-looking statements. These statements are not guarantees of future performance. They involve risks, uncertainties, and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or implied in any statement. Detailed information about factors that may affect our performance can be found in the filings with the SEC, which are on our website. Lastly, in the earnings release, you will see a reconciliation between GAAP and non-GAAP measures following the financial statements. With that, I'll turn the call over to Terry.

Thanks, Adam, and thank you all for joining us this morning. I'll keep my opening remarks brief to highlight what was quite simply a the most successful year in CME Group's history. Following that, Lynn will provide an overview of our financial results and our 2026 guidance. In addition to Lynn, we have other members of our management team present to answer questions after the prepared remarks. 2025 marked our fifth consecutive year of record volume, with average daily volume increasing 6% to 28.1 million contracts, This growth was broad-based, including all-time record in our interest rate, energy, metals, agricultural, and crypto complexes. It was also a record year for our international business, which averaged 8.4 million contracts per day, up 8% from the previous record set in 2024. Global participants continue to choose the deep and liquid markets at CME Group to manage their risk. In addition to our record volume results, we continue to deliver unmatched capital efficiencies for our customers. In the most recent quarter, our customers' average daily margin savings reached $80 billion across all six asset classes, representing an increase of approximately $20 billion over the past year. The ability to offset margin across asset classes isn't just a nice benefit, it's a necessity for our clients. Due to the diversity of our asset classes, this offering is a unique benefit for our market participants. In December, we received approval from the U.S. Securities and Exchange Commission for CME securities clearing. We are on track to launch this new clearinghouse later this year in advance of the SEC's U.S. Treasury clearing mandate. This, combined with our work to extend CME FIC cross-margining to end-user clients in early 2026, will unlock even more capital efficiencies for the industry. Innovation continues to accelerate our growth, and in Q4, we expanded our retail footprint throughout the launch of event contracts on financial and commodity products, economic indicators, and sports. This initiative represents the next step in our multi-year strategy to expand our customer base by providing greater access to markets for the next generation of traders. While still early days, these products are delivering promising initial results and generated traction with previously untapped customer segments. Over 68 million of these event contracts have traded in the six weeks since launch, including over 7 million markets-related contracts. Our retail-focused products also drove strong performance in 2025 with micro-products up 59%. in q4 to a record 4.4 million contracts per day. The one ounce gold contract that we launched last year has been successful with q4 volume of 66,000 per day. Next week, we will be launching 100 ounce silver contract which will help the retail community manage exposure or invest in that commodity at a time when the precious metals markets are very active. Finally, in 2025 was a record-breaking year for CME cryptocurrency trading at CME Group. In the fourth quarter, average value volume across the complex of $379,000 was up 92% and represented over $13 billion in notional value traded per day. This strength has continued into 2026, and next week we will be expanding our cryptocurrency offering at the launch of Cardano, Chainlink, and Stellar Futures on February 9th. we'll begin offering 24-7 trading for our entire crypto suite next quarter to enable our customers to hedge exposure to the underlying cash markets for these products, which currently trade throughout the weekend. As markets continue to evolve, we will strategically evaluate whether other asset classes would also benefit from 24-7. We've carried the momentum from a record-setting year in 2026 with new volume records in January. While The macro landscape grows increasingly complex. We remain focused on providing the premier risk management tools our clients need to navigate market shifts. With that, I'll turn the call over to Lynn to review the financial results in more detail.

Thanks, Terry, and thank you all for joining us this morning. In addition to the volume records Terry discussed, we delivered our fourth consecutive year of record revenues and adjusted net income in 2025. Our revenue of $6.5 billion grew 6% compared to 2024 and included annual revenue records in five out of our six asset classes. Our market data revenue surpassed $800 million for the first time, up 13% from 2024. Adjusted annual expenses excluding license fees were approximately $1.625 billion, and our adjusted operating margin for the year was 69.4%, up 110 basis points from 2024. We delivered $4.1 billion in adjusted net income, resulting in 9% adjusted earnings per share growth for the year. During the fourth quarter, CME Group generated revenue of $1.65 billion, an 8% increase from Q4-24. The average rate per contract for the quarter was 70.7 cents, driving clearing and transaction fees of $1.3 billion, up 8% from last year. Market data reached a new record level, up 15% to $208 million. Adjusted expenses were $543 million for the quarter and $447 million excluding license fees. Our adjusted operating income was $1.1 billion, or a 67% operating margin for the quarter. CME Group had an adjusted effective tax rate of 23.7%. Adjusted net income and adjusted diluted earnings per share came in at $1 billion and $2.77 per share, 10% higher than Q4 2024. Cash at the end of the quarter was approximately $4.6 billion, including $1.3 billion in remaining OSTRA proceeds. Our board has approved the use of these proceeds towards share repurchases over time. We repurchased $256 million in shares during the fourth quarter, an additional $276 million in shares thus far in 2026. CME Group paid dividends of $455 million in the fourth quarter and approximately $3.9 billion in 2025. As announced last year, the annual variable dividend declaration and payment dates have been aligned with our Q1 regular dividend and will be declared next week. Earlier this week, we published transaction fee changes, which will be effective April 1st. Taken in aggregate with the market data fee change, which took effect January 1st, and incentive program revisions, the fee adjustments would increase total revenue by approximately 1% to 1.5% on similar activity to 2025. We will be evaluating transaction fees on a regular basis going forward and may make changes as conditions warrant versus aggregating in December as in past years. For 2026 guidance, we expect total adjusted operating expenses excluding license fees to be approximately $1.695 billion. This includes our typical core expense growth as well as reinvestment related to the new initiatives ramping up this year, including 24-7 crypto trading, securities clearing, and event contracts. We are dedicated to continuously evolving our product set and offering, a commitment that requires strategic investment for growth. Total capital expenditures are expected to be approximately 85 million, and the adjusted effective tax rate should come in between 23.5 and 24.5%. We are proud of the record-breaking results the firm has delivered this year, driving 6% revenue growth and 9% adjusted earnings growth on top of the record set in 2024. We are encouraged by the strong activity to date in 2026 and remain focused on helping our clients navigate this complex environment. We'd now like to open up the call for your questions. Thank you.

At this time, we will now begin the question and answer session. If you would like to ask a question, please first unmute your phone and then press star 1. At any time, if you wish to remove your question, you can press star 2 to remove yourself from the question queue. One moment, please, for our first question. The first question will come from Dan Fannin of Jefferies. Your line is open.

Thanks. Good morning. I wanted to talk about just the current environment and activity, the health of your customer base in aggregate as well. Just given some of the volatility, you guys have raised margin requirements, I think, in the metals complex a few times. We've seen really large swings in the underlying. So I was hoping to just get a little bit more context around that. how you think the customer base is performing through these kind of elevated periods of volatility.

Dan, it's Terry Duffy. Thank you for your question. And I think there's a couple of interesting examples to how the customer is looking at. One, it can be a reflection of open positions as we talk about constantly with analyst investors and others. I think we're sitting around 125 million open positions today. But let's specifically talk about one product which you mentioned, which is silver. And I'll ask Derek to chime in. When we changed the margins on silver, some thought that the market would sell off. We went to a notional margin regime because of the activity related to silver and just on that particular product. that didn't affect the customer base or the product at all because it went and made a new historic high, not went down the other way. So I would say the customer is healthy because of the market direction at which it went, which would tell you that some of the retail participants, which are traditionally long people and others, set new highs in lieu of the way the margins were going forward. So I would say overall the customer is very healthy throughout all the different asset classes, but I wanted to call out your example of silver. Do you want to add to that, Derek?

Yeah, I think Terry made some good points there. I mean, the important part about the health of that market right now is we're seeing all our client segments grow. Yes, retail is growing, but our institutional base is growing double digits right now. I think, Dan, you also look at the quality of the market in terms of open interest. Open interest is steady to increasing. We're seeing volume increases across all regions as well as futures and options. Those are, again, indicators of a risk-on environment. I think price up and price down, but we're seeing a health ecosystem. I think risk management is one of the reasons why customers choose an institutional culture specifically to do their business at CME Group.

Great. I appreciate the comments.

Thanks, Dan. The next question will come from Patrick Molley of Piper Sandler. Your line is open, sir.

Yes, good morning. Thanks for taking the question. and congrats on the launch of the prediction market offering and the JV with FanDuel. I was hoping you could talk about what you've seen to date in terms of engagement and inbounds from market makers and institutions who are looking at the prediction market space, both in sports and non-sport contracts. And then as a second part to that, Terry, we'd love to get your updated thoughts just on the legal and regulatory landscape around prediction markets and some of the comments that have come out of the CFTC recently kind of pledging to create clear rules of the road and defend their jurisdiction there.

Thanks. Patrick, thank you. I'm going to ask Tim to touch a little bit on the market makers as it relates to the prediction markets in sports and the other things you referenced. I'll touch on the legal and the regulatory. I just met with the new chairman of the CFTC, which I'll update you on, but I'll let Tim go first. Thanks, Terry, and thanks, Patrick, for the question.

I think what's been interesting as we've launched the prediction markets at CME Group, we've not only seen new individual participants come to our market as we look to attract that next generation of trader and get more people to trade all products at CME Group across the traditional markets, the futures-based event contracts, or sports. We're also seeing new institutional and market makers reach out to CME Group that are new to CME Group. I think when we look at the innovation of the product design, we are pulling market participants from other parts of the ecosystem where they may be more traditionally sports-based, and they're also coming to our market to reach out how they can market make the event contracts at CME Group, how they can take advantage of the liquidity that is existing at CME Group early days here since we launched in December. So we've been pleased with not only the market maker performance that we've seen on screen in providing liquidity to the marketplace, but the number of clients and new clients reaching out, asking how they can get involved. That's a great thing to see for a new market, but also great to see new participants being attracted to our longstanding benchmark products and markets at CME Group as well.

So, Patrick, on the regulatory and legal side of this, first I'll touch on the legal side. The last thing I'm going to have CME Group do is get tied up in a bunch of legal battles in court over sports. That's not traditionally our business. We are very focused on the market side of this. We have a great relationship with FanDuel. They are in the sports business. They're an online gaming company, as you know. So we thought it was a good marriage. We still believe it's a massively good marriage to distribute our product through FanDuel and touch a whole new customer base to trade our products, which I outlined in my opening remarks about the amount of contracts that are being traded on markets, not sports. So I think that's a very healthy sign. for that particular marketplace. So I really don't want to get involved in the legal battles in court between the states, the tribes, the casinos, and others about if it's gaming or not. I think that's not our fight. So on the regulatory side, I will tell you that I believe that the CFTC looks at these contracts as swaps, as you know, and they are very much wanting to regulate that. I did meet with Chairman Selig. He felt very passionate about that. Passion is my word, not his. I would say that he is committed to overseeing this product. And I do believe he thinks that they are legal swaps under the CFTC's regulation. So that's what I can tell you today. But again, let me emphasize this. We are not going to get bogged down in a bunch of litigation over whether this is sports, or swaps markets. Today, they are called swaps markets, which we participate in, and we will do so. But if, in fact, there's some litigation that we don't like, we will not pursue that particular asset class and tie up our shareholders and others in court cases over this, because I think there's enough people in that fight. But we will remain in the business as long as it's overseen by the Commodity Futures Trading Commission and they deem it to be a legal swap.

Great. Thank you both.

Thank you. The next question will come from Benjamin Budish of Barplace. Your line is open, sir.

Hi. Good morning, and thank you for taking the question. I was wondering if you could address the pricing changes made. I think there was an announcement quite recently. I know market data pricing went into effect earlier in the year. I'm just curious if there's any other puts and takes by asset class. Obviously, from the release, we saw that the rates asset class is not seeing any other changes, but just curious if there's any other context, anything else you could share around the thought process for this year. Thank you.

Yeah, Ben, thank you. I'm going to ask Julie Winkler, my chief commercial officer, to comment on the market data, not only the pricing but the business itself, which gives her an opportunity to talk about that because I think it's a really important component of the CME. And then Lynn can address the other part of your question.

Thanks for your question, Benjamin. We did in January 1st institute a 3.5% RAC rate increase across most of our market data products. And, you know, this was really a continuation of our price-to-value adjustments, you know, ensuring that our data business certainly remains resilient. And we have proven, given the record $800 million in annual revenue that was referenced earlier in our call, this marks the 31st consecutive quarter of growth for our data business. So Q4, we saw, you know, revenue up 15% to $208 million. And just to dig into that a little bit more of talking about the quality of that growth. So our non-recurring revenue items like the audit and the KETS payments were actually lower than the previous quarters, which really just demonstrates that our core subscription revenue is accelerating. And our growth drivers are really kind of balanced across three main pillars. We saw 50% of this revenue growth coming from new user expansion. And we have been successful in really monetizing both the retail growth that you heard us reference as well as institutional participation in our data products. The second pillar of really around 25% of our growth being driven by product innovation. So our ability to deliver new data sets, our new cloud-based delivery models are really helping us to create more sticky recurring revenue. And lastly is that pricing integrity that I referenced earlier of that's the remaining 25% of our growth in revenue where we're able to really capture the value of CME data, particularly given our strong benchmark products and liquid products. These really have become the golden source for futures and options and is a huge contributor to that record revenue that we saw this year. Glenn?

Yeah, so, Ben, when it comes to the transaction fee changes that we announced, the most impacted for those fee changes would be in the metals complex, particularly around precious metals and the micro complex as well. We also had some changes on the crude oil side. And finally, in the grains complex, I would say those are the three areas you will see the most meaningful impacts. You did mention rates, though. One thing to keep in mind, those changes that you saw in that announcement was related to the RAC rate fee schedule changes. We also are always looking at our incentive programs. We did make some changes in various programs, including some incentive programs related to the rates complex. We felt those were more appropriate than needing to change the fee schedule rates at this point. So, overall, this increase is similar to what we've seen in the past years. One other last note, I did mention this in the opening remarks, but we are going to move away from consolidating these type of transaction fee changes in the December timeframe. With the number of new initiatives we have launching and the like, we want to make sure that we are being thoughtful in when we are making these changes. So we may do them at different times during the year versus that consolidated change in the December timeframe going forward.

Okay, very helpful. Thank you both.

Thank you. The next question will come from Craig Siegenthaler of Bank of America. Your line is open.

Thanks. Good morning, everyone. So we have a follow-up question to Ben's last question on your pricing strategy. You know, we're all programmed to look for an announcement in 4Q, see the changes in 1Q. But going forward, it looks like we're not going to get that same transparency from the CME. So curious what drove the change. And does this mean that increases will be smaller in the future? Because I thought the old method worked pretty well, and it provided transparency into seeing these long-term revenue growth rates.

Yeah, Craig, it's Terry Duffy. Listen, we think that we need to do pricing changes as we continue to deliver value, and we don't necessarily need to do that in December every year. And so we make changes based on how we're running the business and how we think we can continue to grow that business and where the value is added. So that comes in different parts of the year. Some increases may be smaller. Some increases may be larger. Some may not be there at all. I think what you're hearing us say is we're running this business on a real-time basis. And we are going to continue to do what's in the best interest of our clients and our shareholders going forward to grow the business. So I don't think there's a pattern that we need to follow in order to facilitate pricing moves one way or another.

Thank you.

You're welcome. The next question will come from Brian Bedell of Deutsche Bank. Your line is open, sir.

Great. Thanks. Good morning, folks. Thanks for taking the question. Maybe just back to prediction markets. Can you talk about conversations that you're having with other distribution partners? I think you've got a total of about 130 retail partners all in. Maybe just characterize the interest from other potential partners to engage with prediction markets, other retail partners to engage with prediction markets on the CME side. platform, and then also how you're thinking about, you know, future product rollout, the potential to really broaden the range of the types of contracts. I know you don't want to get into, obviously, political or culture, but more deeply into, say, financial and company-specific KPIs, you know, something along the lines of fundamental investing, whether seeing any demand for that, or is there any interest in launching those types of contracts?

Thanks, Brian. Let me touch on a couple things. You did say something. I'm going to turn to Tim McCourt in a second, but you touched on political. We're not suggesting that we would not list political contracts. We are suggesting that we would not list certain political contracts, and I think there's a big difference there. When you have a presidential election or who's going to potentially win the House or the Senate, those are large contracts that are very diverse in nature that multiple participants can can take an opinion on versus maybe a small congressional race in a district or a state race or something like that those are the ones we want to stay away from but the larger ones we are not suggesting that we would not take a look at them but i just want to make sure you understand that we do are and are looking at some of the political contracts on the larger scale not the smaller scale on the culture ones those are a little bit different depending on how you define what the culture of the prediction is. So I would have to see what is being referred to as. If it's around some of the award shows and things like that, entertainment, you know, some of those are a little, I don't know if I want to get too much involved in those, but the political contracts on the larger scale are fine. There are some unique business contracts that we talk about, PPI, CPI, things like that, where we're already doing. Tim?

Yeah, thanks, Terry. And, Brian, thanks for the question. You know, we do have a few current distribution partners also live where Terry had mentioned. The FanDuel Predict app is up and running. We also have drafting predictions that are connected. And we have a handful of other distribution platforms also offering our event contracts across all the types of products that we have, the traditional futures-based markets, economic indicators, cryptocurrency, as well as the sports-based event contracts. We are working with our other 120 to 130 retail distribution partners to understand what it will take for them to be ready to offer this contract. We did turn these contracts on back in December, so we still are early days in working with those partners and making sure they have the technological capabilities to connect, offer, and the front end they need to offer these type of swap-based and futures-based event contracts to their participants. I would characterize that pipeline as robust and we're actively engaged with continuing to onboard those participants. Just to further Terry's comments about the future product pipeline at CME Group, this is something that we approach in a similar way to all of our product development. We'll continue to listen to the marketplace our clients, our distribution partners, and our market makers and liquidity providers to figure out what does make sense in terms of rounding out the event contract offering. But it is important to us that this is more than just the trade of the day or what might be happening in the marketplace. We're really focused on getting these new users to our markets and into the known risk-based contracts of events as a way they could enter markets. And we want to make sure they're also having access to things like event contracts on gold, event contracts on NASDAQ, S&P, economic indicators, as well as some of the stuff that we're seeing in the sports and cultural side of the offering. We'll continue to work with them to make sure it makes sense. I think, Brian, about your question around some of the other financial aspects or KPIs, I think those are things that we're hearing from folks, but we have no commitment to look at those products at this time. We'll continue to engage with them. But I think, as Terry's comments also suggested, we do need to make sure and make sure everyone's aware of that these meet the standards at CME and are also part of the CFTC regulatory framework. Those are the things that we look at to make sure that the contracts we do bring to market, we have the comfort and confidence to make sure that the clients trading them have the consistent experience of trading at CME Group that they've been accustomed over the years.

So, Brian, let me just finish the prediction comment with one other thing that I said earlier. We are committed to listing these contracts that are deemed swaps. And if there's sports event-related swaps, we will list them. When I said that we don't want to get tied up in legal battles, it doesn't mean that we're going to run away. As long as the federal government calls these swaps, we will participate in them. That's our regulator. And if the states and others have issues with it, they should take it up with the federal government, not that the entities that they approve for these contracts to be traded on their DCMs. So that's what I meant about the legal battles.

Yeah, that's fantastic, Carter. Thank you.

The next question will come from Bill Katz of TD Cowen. Your line is open.

Great. Thank you for taking the question. Maybe if I could sneak a two-part question in, somewhat disparate, so I apologize in advance. But first, it's great to see you buy back some stock in the fourth quarter and early here into the new year. How do we think about maybe the prospective approach to capital and how much of like sort of related to the OSTRA proceeds and so forth as we should think about maybe the go-forward payout dynamic? And then within your market data and information services, it was nice to see the rise quarter on quarter. I would posit that's probably more of the activity levels. But could you speak to the durability of that given what seems to be a very frenetic change in expectation around sort of subscription and data packages given AI disintermediation risk? Thank you.

Thanks, Bill. Yeah, well, we'll talk about that in a minute. The AI disremediation risk is an interesting question. We'll get to that in a second because I think that was your last one. So let's talk about the capital. I'll let Lynn discuss that. And on the market data, was that tied to the AI part of your question? Is that a fair way to assess it?

Yes, correct. Thank you.

Okay. All right. So go ahead, Lynn.

Hi, Bill. This is Lynn. So your question on the buyback, We have discussed with our board, and we'll be using the offshore proceeds towards repurchases. So you've seen us start along that path, and we will continue to be deploying that capital towards repurchases over time. And then, Julie, if you maybe want to address some of the market data questions.

Yeah, I think the importance of, you know, certainly all of 2025 performance was really – speaking to the recurring subscription revenue that this business generates. So the uptick in both retail participation and institutional demand for our clients, you know, serves as good momentum going into 2026, and that is something that we've seen with the historic growth of the business, you know, up 31 consecutive quarters. In terms of AI, we have been, you know, on top of that from the beginning, and I think a key part of thinking about – data versus how our clients use data is this is a critical input for them as they backtest their trading strategies and deploy those within our marketplace to both provide proper hedging as well as liquidity into our market space. And so while AI and the use of data is important there, You know, it does not change how that data is being used by our trading entities. We are very much talking with our customers about how they're using AI to enhance a lot of their trading algorithms, but they still need that core source data, and we do and have been adjusting our policies accordingly as the AI has continued to develop.

So, Bill, I assume your question was related to around some of our competitors as it relates to mortgage businesses and some of their surveillance businesses that could be potentially disrupted by artificial intelligence. We are not in that situation today, as Julie described. This is proprietary data that people need for risk management protocols and everything else that they do. So we're not in some of those other ancillary businesses that could be potentially disrupted by AI. We actually believe we're in a situation where AI could enhance our customer, enhance our business going forward. Not disintermediate or destructive. Does that make sense? I think that's where your question was going, even though you didn't ask it that way.

Well, I was trying to be a little bit more neutral on it, but thank you. Yes, appreciate it.

Thank you. Bill, you know me. I kind of get to the point.

Thank you so much.

Thank you. The next question looks from Ashish Sabhadra of RBC Capital Markets. Your line is open.

Thanks for taking my question. I just wanted to ask a question on the progress on the Google Cloud migration and if you can quantify the expense in the fourth quarter and expected for 2026. Thanks.

So, why don't we talk for a second on the migration with Sunil and then we'll talk real quick on the expenses with Lynn. So, Sunil, give a quick update on the migration.

Our migration is going very well to plan. We'll complete our non-ultra-low latency migration in early this year. As far as our ultra low latency markets are concerned, the purposeful Chicago region by Google is coming up to plan. It is low latency technology in Google Cloud. It's very novel. So we'll be making that available to clients for testing in 2027. I'll pass it on to Lynn.

So in the fourth quarter, we had about $29 million in spending related to the cloud environment. The majority of that was in our tech line related to the consumption charges. So our total for the year was right around $100 million related to Google. It's getting harder and harder as we go forward, though, to disaggregate the Google-related charges and our base charges because we've seen so many of the on-premises expenses start to roll off. So I would say going forward, that expense is built into our overall guidance, but it's becoming, I think, less meaningful to separate it out just because you've taken out a lot of those on-premises expenses. So I would just start counting that in the overall expense growth that we guided to, the 1695. That is inclusive of all the tech-related spend, both Google and the remaining on-premises.

Very helpful, Kala. Thank you.

Thank you. The next question will come from Michael Cypress of Morgan Stanley. Your line is open.

Oh, hey, good morning. Just curious how you see the role of tokenized collateral and potential benefits there. And more specifically, how do you think about some of the advantages or even disadvantages of stablecoin as collateral versus tokenized deposits versus, say, a tokenized money fund? I guess, would you accept all three? Would you treat any of them differently? Curious how you think about that and if you could elaborate on more broadly on the steps that you're taking this year to tokenize collateral?

Michael, thank you. And it's a great question. I don't know if we have enough time to answer all because it's pretty deep, but I will try to summarize it for you. As it relates to the tokenized cash, you know, we have initiative that we're rolling out with Google that will be coming out this year on tokenized cash. And that will be with another depository bank that will help facilitate those transactions. On the tokens and what would we accept in going forward, that all depends on who is issuing the token and giving it to us. And it would depend also based on the risk associated with that token. Would we haircut it to a point where it's even worth taking or not? And what's the entity that's issuing the token to give us for margin? So right now, we are looking at different forms of margin, but we are not going to put the enterprise at risk by taking something that we can't get our arms around. So if you were to give me a token from a systemically important financial institution, I would probably be more comfortable than maybe a third or fourth tier bank trying to issue a token for margin. That's probably something I would not accept. So that's kind of how we're looking at what we'd accept and how we distribute. So not only are we looking at tokenized cash, obviously we're looking at different initiatives with our own coin that we could potentially put on a decentralized network for other of our industry participants to use. So there's multiple different ways that we're approaching this to create efficiencies for our clients going forward without introducing any additional risk to the system.

Great. Thank you. Thanks, Michael.

And we'll take the last question from Ken Worthington of J.P. Morgan. Your line is open, sir.

Hi. Thank you so much for squeezing me in. You mentioned that the CFTC approved cross-margining for client accounts to be launching shortly. What sort of cross-margin programs are you launching, and what sort of adoptions do you anticipate? And along the same lines, you also got approval to launch treasury and repo clearing. How would you expect these two initiatives to impact collateral balances over time?

Great question, Ken. So I'll ask Sunil to comment on the first part of it, and maybe, Mike, you can touch on the second.

Sure. So the, you know, the CME FICC cross-margining program for clients is operationally ready. That program has been running since 2024. We have 18 firms participating. We generated record savings for those firms of about one, one and a half billion. In terms of expanding to clients, while we are operationally ready, we are dependent on the approval from the SEC, which is expected sometime this year. In terms of, you know, generally our portfolio margin savings, we are generating about $25 billion in the interest rate complex. That includes the $1.5 billion, which includes future swaps and cash products.

So, Ken, just to be clear, you were referring to our treasury clearing offering and what it could do to deliver value versus what we have today with others. Is that just so I'm clear so we can answer it correctly?

Yeah, there was two parts to it. One is I thought you just got approval for client accounts from the CFTC. I know you were waiting for that for a while. I thought that was just approved and that you will be sort of launching those programs sort of imminently. And then the second part was just on the Treasury.

Yeah, that's the one that's nailed this reference. We are still waiting for the SEC to approve. The CFTC has. The SEC has not yet. We're hoping that comes shortly.

Got it. Okay. Okay, awesome. Thank you.

And then the other part of your question was around the benefits of CME Treasury clearing. Is that right?

Yeah, like just on your collateral balances, you know, what are you kind of anticipating there? Linda's a big deal.

Yeah, so it's a little hard to forecast at this point, Ken, but certainly with things like the mandates potentially coming for broader inclusion in need for clearing of some of these securities going forward, so some of the new types of clients that might need to clear going forward, that could be additive to that amount of collateral. But I think what's unique and what is important to remember is So Neil talked about these offsets we had within our complex, so the $25 billion a day. That's inclusive of all of our futures and options, the swaps that we're clearing here at CME, as well as the offsets with FICC. When we have our Treasury clearing offering added to that and potentially the ability to offer additional cross-margining, we are bringing more into that pool of capital and the efficiencies that can be created for clients by using these different pieces of the stool. So it is just further reinforcing the value proposition for clients and freeing up their capital for potentially other uses. So we think it's important that we're addressing all these different pieces.

The interesting part about all this, Ken, is our arrangement with FIC, which is critically important to the growth of this company, especially when it comes to clearing and giving offsets going forward in the rates business to make sure that we are the dominant participant to bring your business to. That has upticked at FIC in recent months with new participants coming into it. So we were around $1 billion, I believe, a day with just the FIC offsets. That's upticked several hundred million over the last 500 million or so in the last couple months, and we see that continuing to grow. So the agreement we have with FIC – is growing by the day. That is really the important part of this. Our treasury clearing offering is a nice-to-have. We will continue to roll it out in a methodical way. But the true value that we see right now and today is with DTCC and the FIC clearing organization. That's where the value is at, and that's what we're keeping our minds focused on.

Great. Thank you.

Thank you.

And at this time, I will turn the call over to Terry Duffy for closing remarks.

Thank you. And while 2025 was a landmark year for CME Group, our record performance in January provides a solid foundation as we move into 2026. We are delivering on our strategic roadmap, launching CME securities clearing, expanding our event contracts, and introducing 24-7 trading to meet the evolving needs of our clients. These investments reinforce our leadership. as the world's premier risk management destination and will drive substantial growth for years to come. Once again, thank you for joining us on our call today. Thank you.

This concludes today's conference call. You may all disconnect at this time.