Nasdaq, Inc.

Good day and thank you for standing by. Welcome to NASDAQ first quarter 2025 results conference call. At this time, all participants are on the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To rejure your question, please press star one one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker, Atul Garrett, Senior Vice President and Investor Relations Officer. Please go ahead.

Good morning, everyone, and thank you for joining us today to discuss NASDAQ's first quarter 2025 financial results. On the line are Adina Friedman, our Chair and Chief Executive Officer, Sarah Youngwood, our Chief Financial Officer, and other members of the management team. At your prepared remarks, we'll open the line for Q&A. The press release and earnings presentation accompanying this call can be found on our Investor Relations website. I would like to remind you that we will be making forward-looking statements in this call that involve risks. A summary of these risks is contained in our press release and a more complete description in our annual report on Form 10-K. We will discuss our financial performance on a non-GAAP basis and adjust it for the prior year impact on Axiom SL as if we recognize revenue ratably for on-prem contracts and excluding the impact of FX and the previously announced one-time revenue benefit and index in the first quarter of 2024. Definitions and reconciliations of U.S. GAAP to non-GAAP plus adjustments can be found in our earnings presentation, as well as in a file located in the financial section of our investor relations website at ir.nasdaq.com. I will now turn the call over to Adina.

Thank you, Otto, and good morning, everyone. Thank you for joining us. This morning, I will start with a review of NASDAQ's financial and operational performance for the quarter. I'll then provide an update on our outlook on the current operating environment before handing the call to Sarah to walk through the financial results in more detail. The year began with favorable business conditions as the global economy maintained solid performance. However, as the quarter progressed, we experienced a marked increase in uncertainty driven by changing trade policies and heightened geopolitical tensions. Now, as I entered the year in a position of strength, and we remained laser focused on delivering for our clients despite the dynamic nature of the operating environment. The trust that we have built with our clients, the mission critical nature of our solutions, and the diversification of our platform has served us well in these times of heightened uncertainty and volatility. As a result, we've been able to enhance our competitive position, execute our strategy, and create value for our clients and for our shareholders. We delivered double-digit growth across all three divisions with net revenues of $1.2 billion, representing a 12.5% increase from the prior year period. Solutions revenues were $947 million, representing 11% growth year-over-year, and ARR rose to $2.8 billion, up 9% year-over-year. First quarter operating income rose 17%, and EPS grew 24%, benefiting from strong revenue performance and expense management while we continued to invest in our products and capabilities to serve our clients over the long term. At the divisional level, capital access platforms generated 5% ARR growth and 11% revenue growth, driven by continued strength in both net inflows and new product innovation in our index business. Financial technology delivered 10% revenue growth, ARR growth was 12%, which included 21% growth for financial crime management technology, 11% growth for regulatory technology, and 9% growth for capital markets technology. Market services delivered 19% net revenue growth driven by record U.S. cash equities and derivatives revenue and growth in European equity derivatives volumes and capture. Beyond our excellent financial results, we continue to make progress on our strategic priorities, After achieving our target of $80 million in net synergies from the IDENTA transaction, we expanded our efficiency program to target $140 million inclusive of our original synergy program. And we're on pace to achieve it by year end with over $100 million actioned as of the end of the first quarter. Our strong free cash flow of $674 million in the first quarter supported continued deleveraging and share repurchases to offset dilution from employee vesting. Finally, we remain on track to surpass $100 million in run rate revenue from cross-sells by the end of 2027, as we have delivered 19 cross-sells since the identity acquisition, including two in the first quarter. Turning to our operational highlights, starting with capital access platforms, we continue to execute on the growing opportunity in front of us as we build new products to help our clients navigate market complexity. Our solutions take on increasing importance in periods of uncertainty and market volatility. For example, our analytics platform provides actionable portfolio and fund-level insights to help institutional investment clients manage their investment strategies and dynamic markets. In addition, our IR and governance solutions provide market-driven analysis to help corporate clients connect more successfully with their boards and investors as they manage their businesses through a fast-changing environment. Moving down to a review of the Capital Access Platform subdivisions, starting with the data and listings in the first quarter, NASAC welcomed 45 operating companies, raising approximately $5 billion in total proceeds. Overall, NASAC had an 82% win rate for NASAC-eligible operating companies, featuring three of the top five largest IPOs in CoreWeave, SailPoint, and Smithfield Foods. Beyond IPOs, we have sustained our listing transfers momentum with several marquee switches in the first quarter, including Shopify, Thomson Reuters, and Domino's Pizza. After celebrating our 500th switch last year, during the first quarter, we officially crossed the $3 trillion threshold in combined market value for listing transfers to NASDAQ since we first launched our switch program in 2005. This tremendous milestone further reinforces our role as the premier venue for listings in the United States. Building on our listings leadership, we launched a new research and advocacy program to engage the new U.S. administration on a set of policy recommendations that promote capital formation, enhance the public company model, and ultimately reinforce the position of the U.S. capital markets. In our data business, we benefited from new sales, upgrades, and higher usage across the business, as well as strong traction across our new products and geographies. The index business delivered another outstanding quarter as we achieved 26% revenue growth and a record and average ETP AUM for the quarter. Net inflows remained robust and we continued to see strong increase in derivatives volumes, including a record quarter. NASDAQ's index franchise has multiple vectors for growth and indexes performance reflects the ongoing execution of our growth strategy of new product innovation, international diversification, and institutional client expansion. In fact, the new products that we've launched since 2020 have accounted for 33% of net inflows over the last five years. We built on this success in the first quarter as we launched 30 new index products, including 10 outside the United States and seven insurance annuity vehicles. Within Workflow and Insights, analytics experience solid growth among the investor community as we continue to integrate our data more deeply in client workflows and applications. In corporate solutions, we continue to focus on strengthening our offerings through product enhancements, including AI features, while we manage our corporate clientele through a continued period of elongated sales cycles. Turning to our financial technology division, we signed 40 new clients, 92 upsells and two cross-sells. In today's environment of heightened market activity and complexity, financial institutions and market operators face an increasing range of challenges, NASDAQ is uniquely positioned to help solve. Our trade lifecycle solutions are designed to support our market operator clients around the world during significant bursts in trading activity while maintaining a hyper resilient infrastructure. We also provide mission critical trading and regulatory reporting infrastructure to banks and brokers worldwide, which help them manage heightened trading and capital risk. As we partner with banks to fight financial crime, a shifting macroeconomic and global political conditions tend to motivate an increase in criminal behavior. We are also focused on advancing Nasdaq's vision to be the trusted fabric of the world's financial system. This morning, we announced an enhanced partnership with AWS that is designed to benefit both our market services and financial technology divisions. Across our own markets, Nasdaq's move to the cloud has enhanced our ability to navigate the current environment successfully due to the increased and instant scalability of our market infrastructure, including our matching engines, resulting in enhanced resiliency and efficiency across our markets. Through our expanded partnership with AWS, we plan to leverage the learnings and expertise gained from our transition as we continue to modernize the global financial ecosystem. Over the coming years, AWS and NASDAQ intend to progress in phases to serve the full range of our financial services clients. It will start with a focus on our market operator clientele through packaged public cloud and hybrid cloud infrastructure, software, and services that build on NASDAQ's successful modernization of its own options markets. The combined power of AWS and NASDAQ will enable market operators to modernize in a cost-effective manner while mitigating transformation risk retaining data sovereignty, and maintaining the highest levels of performance, security, and resilience. Now turning to a review of our FinTech subdivisions, beginning with financial crime management technology. NASDAQ VeriFin continued to see robust demand during the first quarter, and we delivered a new cross-sell with a Tier 2 bank. We also added 35 new SMB clients in the first quarter, a 25% increase in new client signings over the prior year quarter. Nasdaq Verifin's ongoing client growth is contributing to the growth and power of its data consortium, which now includes clients holding more than $10 trillion in total assets. The business has also made progress on its land and expand strategy, signing an expansion deal with an existing Tier 2 Nasdaq Verifin client. The upsell was negotiated and signed in six months, marking approximately a 50% reduction in sales cycle when compared to the original contract. More broadly, we continue to drive enhanced product functionality across the financial crime portfolio. NASDAQ Verifin's GenAI-powered entity research co-pilot has seen a 20% increase in client usage compared to the fourth quarter, showcasing the value and efficiency that this platform delivers for our clients. Currently, more than 1,200 clients are leveraging the co-pilot to expedite their alert reviews. Building on this success, we plan to launch a new co-pilot feature in our case management module. This feature, which is currently in beta with clients, will help automate and expedite case investigations and documentation. Looking forward to the rest of 2025, we expect to introduce new capabilities that go beyond task automation with the use of agentic AI, which will enable banks to automate entire workloads, allowing for significant efficiency gains in compliance operations like due diligence and sanctioned screening. Turning next to regulatory technology, Axiom SL signed a large digital bank as a new client and delivered 22 upsells, including a deal with a large Tier 1 U.S. financial institution. The Tier 1 client expanded its suite of Axiom SL services by incorporating a broker-dealer solution alongside their existing U.S., European, and Asian reporting modules. Surveillance signed four new clients during the quarter, including a regulator in Europe, a crypto marketplace, an energy trading firm, and a broker-dealer, representing the diverse client set that our solutions serve. Surveillance continues to see strong demand as clients seek to reduce operational complexity, particularly in the midst of elevated market activity. Moving to the capital markets technology subdivision, our market technology business continues to advance its international strategy, helping to modernize capital markets infrastructure across emerging economies with 17 upsells. Nasdaq delivered an upsell with an Asian exchange and a cross-sell with Nuam, the consolidation of the marketplaces across Peru, Chile, and Colombia. Importantly, the Nuam deal demonstrates how we have become a trusted partner to an existing client that signed on for two additional solutions since its initial signing in 2023. In the first quarter, Calypso delivered 25 upsells, which reflect broad-based momentum across our client base, including a significant expansion with a European client. Now turning to our market services division. The volatile market conditions across the first quarter showcase the depth and quality of our markets. NASDAQ is the leading platform across the U.S. and European markets, and we delivered another quarter of double-digit growth with record net revenues and volumes. In the U.S., We generated record net revenues for U.S. options, including index options and U.S. cash equities, and we were pleased to increase our on-exchange market share in U.S. cash equities in the first quarter. These results represent the exceptional performance of our systems, supported by the consistent investments that we have made over the years, the strength of our closing cross, our superior liquidity, and the trust that we've built with our clients. In Europe, we saw strong results across both cash equities and equity derivatives. Within equity derivatives, we saw a year-over-year increase in both volumes and capture. At the start of the second quarter, we experienced unprecedented levels of message traffic and volumes. The U.S. cash equities markets experienced five of the six highest trading days in industry history, and the U.S. options markets had four of the six highest trading days. During this period, Nasdaq's markets performed extremely well as we managed enormous volumes in inbound and outbound message traffic, including Nasdaq's most active day ever on April 7th, which exceeded 550 billion messages. Mirroring our U.S. markets, European cash equity saw unprecedented activity in the first two weeks of April, delivering the seven highest message traffic days on record. I'm proud to say that our teams seamlessly navigated this heightened demand and remain prepared for an environment marked by elevated volatility. Now I'd like to take a moment to discuss the current macro environment. Recent policy shifts and ongoing talks about potential tariffs have created significant short-term volatility, and that uncertainty is at this point weighing on global GDP growth expectations. Entering the second quarter, this is creating modest impacts on the timing of corporate decision-making, although without a meaningful change in overall demand. Across all economic cycles, our clients rely on NASDAQ as a trusted partner. Our global markets enable capital formation and provide investors with certainty of execution. We provide corporate issuers with critical access to funding, while providing banks, brokers, and investors with transparent and efficient mechanisms to adjust their strategies and comprehensively manage risk. Further, the current volatility in U.S. trading has illustrated the critical nature of our markets and the resilience of their underlying infrastructure. NASDAQ is a global business, and we have teams across the world that serve our clients at a local and regional level, which allows us to understand the specific dynamics our clients face and ensures NASDAQ is positioned to help them solve their problems as they evolve. Against this backdrop, the power of NASDAQ's platform and diversified business positions us for resilient growth, as demonstrated by our outstanding first quarter's performance. With that, I will now turn the call over to Sarah to provide more details on our financial results.