Record Net Revenue
Net revenue reached a record $729 million in Q1, up 29% year-over-year, driven by broad-based strength across core businesses.
Cboe Global Markets
· CBOE
May 1st, 2026
Summary
- Earnings Call Date:
- 2026-05-01
- Change Since:
- -23.50%
- Next Earnings Date:
- 2026-07-31
Earnings Call Sentiment
PositiveThe call highlights exceptionally strong operational and financial performance: record net revenue, record adjusted EPS, sizable EBITDA growth and margin expansion, broad-based strength across derivatives, cash/spot markets, FX and DataVantage, plus clear strategic moves to sharpen focus and return capital. Lowlights include planned workforce reductions (~20%), a modest anticipated ~3% revenue reduction from exits, some one-time DataVantage revenues, phased timing of cost-saving benefits (limited incremental savings in 2026), and regulatory/competitive uncertainties around event contracts and future franchise dynamics. On balance the positive performance, robust margins, strong balance sheet and clearly articulated strategy materially outweigh the execution and timing risks described.
Company Guidance
For 2026, Cboe guided to DataVantage organic net revenue growth in the low double‑digit range and total organic net revenue growth in the low double‑digit to mid‑teens range; it lowered full‑year adjusted operating expense guidance to $838–$853 million (from $864–$879 million), with CapEx unchanged at $73–$83 million and depreciation & amortization at $56–$60 million, and an adjusted effective tax rate of 27.5%–29.5%. Management expects net interest (income less expense) to be a $3.5–$4.5 million positive contributor in Q2 2026. As part of its strategic realignment, Cboe now targets an approximate 12%–14% annualized reduction in adjusted operating expenses (roughly $100–$120 million of savings), with $40–$50 million of that tied to incremental actions and $20–$25 million of incremental savings expected to be realized in 2026. The pending sales of Cboe Canada and Cboe Australia are estimated to represent ~$60–$70 million of annualized net revenue and ~$40–$50 million of expenses that would exit the company once closed (about a ~3% annualized net‑revenue headwind vs. 2025). Capital deployment remains opportunistic: $45 million of buybacks in Q1, a $0.72/share Q1 dividend (total Q1 returns $121 million), adjusted cash of ~$2.1 billion and leverage of ~0.8x.
Record Adjusted EPS and EBITDA Expansion
Adjusted diluted EPS was a record $3.70, up 48% year-over-year. Adjusted operating EBITDA was $541 million, up 41% year-over-year, and adjusted operating EBITDA margin expanded 6.1 percentage points to 74.2%.
Derivatives Strength and SPX Leadership
Derivatives net revenue rose 32% year-over-year. Index options net transaction and clearing fees increased 35%. SPX options set a quarterly record with average daily volume of 4.9 million contracts (+34% YoY) and a monthly ADV record of 5.4 million contracts in March. Total options ADV was up 10% and index options volume rose 29%.
Cash & Spot Markets Outperformance
Cash and spot markets net revenue grew 34% year-over-year with Europe & APAC up 32% (net transaction & clearing fees +43%) and North American Equities net transaction & clearing fees +40%, contributing to records in several European trading services and multiple top trading days in March.
FX and Futures Momentum
Global FX delivered the strongest segment growth at +38% year-over-year (average daily notional value +36% and net capture +4%). Futures net revenue increased 9% with total ADV up 14%, supported by stronger VIX activity.
DataVantage Growth Driven by New Sales
Cboe DataVantage net revenue rose 19% year-over-year, with ~85% of growth driven by new units and new sales (including one-time historic dataset sales tied to recent product launches); management now expects DataVantage organic net revenue growth in the low double-digit range for 2026.
Strategic Realignment and Cost Savings
Management reached definitive agreements to sell Cboe Canada and Cboe Australia and announced additional realignment actions. Once fully implemented, strategic realignment is expected to deliver approximately $100 million–$120 million of annualized expense savings (now targeting a 12%–14% annualized reduction in adjusted operating expenses vs 2025).
Strong Capital Position and Shareholder Returns
Returned $121 million to shareholders in Q1 (including $76 million dividend), repurchased $45 million of shares in the quarter, held adjusted cash of $2.1 billion and a leverage ratio of 0.8x, enabling opportunistic buybacks and reinvestment.
Execution on New Product Initiatives
Announced the plan to launch securities-based event contracts (leveraging Mini‑SPX infrastructure) and signaled longer-term ambitions in event/prediction markets, tokenization, and expanded clearing capabilities, aiming to leverage Cboe’s market design, surveillance and distribution strengths.