Intercontinental Exchange Inc.

today. After the prepared remarks, there'll be an opportunity to ask questions. If you'd like to participate in the Q&A, you can do so by pressing star followed by one on your telephone keypad. I'll now hand you over to Katia Gonzalez, Manager of Investor Relations, to begin. Please go ahead.

Good morning. ICE's first quarter 2025 earnings release and presentation can be found in the investor section of ICE.com. These items will be archived, and our call will be available for replay. Today's call may contain forward-looking statements. These statements, which we undertake no obligation to update, represent our current judgment and are subject to risks, assumptions, and uncertainties. For our description of the risks that could cause our results to differ materially from those described in forward-looking statements, these refer to our 2024 Form 10-K, 2025 First Quarter Form 10-Q, and other filings with the SEC. In our earnings supplement, we refer to certain non-GAAP measures. We believe our non-GAAP measures are more reflective of our cash operations and core business performance. You'll find a reconciliation to the cooling gap terms in your earnings materials. When used on this call, net revenue refers to revenue net of transaction-based expenses, and adjusted earnings refers to adjusted diluted earnings per share. Throughout this presentation, unless otherwise indicated, references to revenue growth are on a constant currency basis. Please see the explanatory notes on the second page of the earnings supplement for additional details regarding the definition of certain items. With us on the call today are Jeff Sprecher, Chair and CEO, Warren Gardner, Chief Financial Officer, Ben Jackson, President, Lynn Martin, President of NYSE, and Chris Edmonds, President of Fixed Income and Data Services. I'll now turn the call over to Warren.

Thanks, Katya. Good morning, everyone, and thank you for joining us today. I'll begin on slide four with a summary of our record first quarter results. First quarter earnings per share of $1.72 were up 16% year over year. These strong results were led by an 8% increase in net revenue to a record $2.5 billion. Importantly, against the backdrop of macroeconomic uncertainty, we saw growth across all three of our operating segments. First quarter adjusted operating expenses totaled $964 million, slightly below the low end of our guidance range, driven in part by better than anticipated savings and synergies primarily related to technology spend. As a result of this strong performance, adjusted operating income increased by double digits of 11% versus the prior year and reached a record $1.5 billion. This strong business performance allowed us to return $519 million of capital to our shareholders during the quarter, including $241 million of share purchases. And we did this while also investing in our business and reducing leverage, which ended the first quarter under 3.2 times EBITDA. Before I move to our segment results, I'll now note a few guidance items. As we look to the second quarter, we expect adjusted operating expenses to be in the range of $980 million to $990 million, with the increase versus the first quarter largely driven by a weaker dollar relative to the pound and euro. a dynamic that is more than offset by higher revenues, a full quarter of merit increases, and an accrual for awards related to our strong year-to-date performance. Second quarter non-operating expenses expected to be between $175 million and $180 million, with slightly lower interest expense from reduced leverage offset by the refinancing of our $1.25 billion maturity coming due in May. Now let's move to slide five, where I'll provide an overview of the performance of our exchange segments. First quarter net revenues totaled a record $1.4 billion, up 12% year over year. Record transaction revenues of nearly $1 billion were up 16%, driven by an 18% increase in our interest rate business, 21% growth in NYSE cash equities and options revenues, and another quarter of record energy revenues, which grew 23% year over year. In addition, Volumes accelerated in April with energy ADV up 39%, interest rate ADV up nearly 60%, our cash equity ADV up 68%, and our equity option ADV up 11%. And importantly, amidst rising volatility, open interest continues to build up 8% year over year, including 21% growth in global interest rates and 7% growth in our energy markets. Shifting to recurring revenues, which include our exchange data services and our NYSE listings business, revenues totaled $368 million, up 3% year-over-year. Underpinning growth in our recurring revenues was our broader exchange data and connectivity services, which grew 5%, as once again led by futures data services. In our listings business, the NYC helped to raise over $4 billion in new proceeds in the first quarter, including Venture Global, the largest IPO year to date. It's worth noting that less than 40% of IPOs met the NYC's listing standards in the first quarter, and these high standards remain a critical component of our 99% plus retention rate. Additionally, the backlog for new ITOs remains strong, with a variety of companies seeking to raise capital when volatility abates. Turning now to slide six, I'll discuss our fixed income and data services segment. First quarter revenues totaled a record $596 million, including transaction revenues of $125 million. On a year-over-year basis, Revenue at ICE bonds increased by 16%, driven by 18% growth in our muni business and 30% growth in corporate bond trading. Within our CDS business, revenues increased year over year with lower members' interest offset by clearing revenue, which increased 27% year over year amidst increasing macroeconomic uncertainty. Recurring revenues totaled a record $471 million and grew by 5% year over year. In our fixed income data and analytics business, Revenues increased 4% year-over-year, driven by growth in pricing and reference data, and 14% growth in our index business, which reached a record $684 billion in ETF AUM as of the end of the first quarter. Data and network technology, which we previously referred to as other data and network services, increased by 7% in the first quarter, an acceleration from 5% growth in 2024. Growth was driven by the return on various data center investments we have recently made in our ICE global network, as well as continued growth in our consolidated feeds business and strong performance across our desktop solutions, driven in part by cross-sell opportunities sourced from both our energy and NYSE customer bases. Please flip to slide seven, where I will discuss our mortgage technology results. First quarter revenues totaled $510 million. Recurring revenues totaled $397 million, up both sequentially and year-over-year. On a year-over-year basis, the improvement was largely driven by our servicing business. And while we benefited from a few million dollars of one-time revenue that we do not anticipate will repeat, growth was also driven by new customers implementing on MSP. Transaction revenues totaled $113 million, up slightly year-over-year, driven by revenue growth related to Encompass closed loans and applications. an increase in closing solution fees, and higher default management revenues as foreclosure starts within our servicing business had begun to tick higher from historic lows. In summary, we delivered record first quarter results, included record revenues, operating income, and adjusted EPS, building upon our record 2024. Amidst macroeconomic and geopolitical uncertainty, we are uniquely positioned to invest across our business, meet the needs of our customers, and continue to deliver consistent and compounding growth for our shareholders. I'll be happy to take your questions during Q&A, but for now, I'll hand it to Ben.