Nasdaq thanks all front-line workers who are committed to providing essential services to those impacted by the COVID-19 pandemic. The company’s relief efforts will support small businesses, food provisioning to vulnerable communities, and the safety of healthcare workers.

First quarter 2020 net revenues¹ were $701 million, an increase of 11% over the first quarter of 2019. Compared to the prior year period, revenues in the non-trading segments² increased 7%, primarily due to organic growth, while Market Services revenues rose 21%, due to historic trading volumes primarily in the second half of the first quarter.

The GAAP operating margin was 39% in the first quarter of 2020, down from 43% in the prior year period, due to bond refinancing costs, while the non-GAAP operating margin³ of 52% increased from 49% in the prior year.

First quarter 2020 GAAP diluted earnings per share was $1.22, down from $1.48 in the first quarter of 2019, with the decrease largely due to bond refinancing costs in the first quarter of 2020, and a gain on the sale of a business and income from our equity interest in an equity method investment in the first quarter of 2019. First quarter 2020 non-GAAP earnings per share was $1.50, compared to $1.22 in the first quarter of 2019.

During the first quarter of 2020, the company strengthened its balance sheet by increasing cash reserves to address any potential short-term funding risks due to the effects of COVID-19. Additionally, Nasdaq refinanced all of its 3.875% senior notes due 2021, extending our nearest bond maturity to May 2023.

Represents revenues less transaction-based expenses.

Constitutes revenues from Market Technology, Information Services and Corporate Services segments.

Refer to our reconciliations of U.S. GAAP to non-GAAP net income, diluted earnings per share, operating income and operating expenses, included in the attached schedules.

U.S. GAAP operating expense and tax rate guidance are not provided due to the inherent difficulty in quantifying certain amounts due to a variety of factors including the unpredictability in the movement in foreign currency rates, as well as future charges or reversals outside of the normal course of business.

Nasdaq pledges business and philanthropic support in response to COVID-19. In the first quarter of 2020, Nasdaq committed cash and in-kind donations totaling $6 million to COVID-19 response and relief efforts to help provide assistance to those who are most at risk. As part of Nasdaq’s $6 million philanthropic commitment, a total cash donation of $5 million will be provided to the following programs: the Opportunity Fund’s Small Business Relief Fund to support small business owners; the World Central Kitchen’s #ChefsForAmerica relief efforts; and the World Health Organization’s COVID-19 Solidarity Response Fund. To support local health care providers, Nasdaq donated 12,000 face masks to the Greater New York Hospital Association. Additionally, approximately $1 million of advertising time on the Nasdaq MarketSite Tower in Times Square is reserved for public service address messages.

Nasdaq’s exchanges delivered resilient performance as market activity and net revenue each set new highs. Nasdaq is committed to resilient markets and maintains an operational excellence program to ensure capacity, performance and reliability of the company’s trading systems. All of Nasdaq’s electronically operated equities, options and fixed income markets operated at high performance levels during the surge of trading volume related to the COVID-19 pandemic. During March 2020, message traffic increased approximately two times versus March 2019 in Nasdaq’s U.S. equities marketplaces and increased approximately three times in Nasdaq’s U.S. options markets compared to the prior year period. Additionally, Nasdaq’s combined U.S. equities and options markets as well as its Nordic equities marketplaces set monthly company records for trading volumes in March 2020. Net revenue of $281 million in the first quarter of 2020 set a new record in Market Services.

Nasdaq’s organic growth in non-trading segments was broad based, driven by gains in each of the Market Technology, Information Services and Corporate Services segments in the first quarter of 2020. Market Technology grew Annualized Recurring Revenue¹ (ARR) to $257 million, up 9% compared to the prior year period. Information Services set a new quarterly high in revenues, due to year over year growth in AUM in licensed ETPs, as well as record volumes in licensed index futures. Corporate Services welcomed 27 U.S. IPOs in the first quarter of 2020, representing 69% of U.S. IPOs, the majority of U.S. IPO capital raised at 58%, and the largest IPO this year to date: PPD, Inc.

Nasdaq expands client offering through the acquisitions of investment data firm Solovis and ESG specialist OneReport. Nasdaq announced the acquisition of Solovis, which offers multi-asset class, public and private market portfolio management, analytics and reporting tools used by institutional investors and consultants. Solovis solutions expand on the capabilities of Nasdaq’s eVestment group, a leading data and analytics solution facilitating institutional asset allocation research and decisions. Nasdaq also announced the acquisition of OneReport, a privately-held provider of corporate responsibility and environmental, social and governance (ESG) data management and report services. OneReport brings efficient, effective reporting tools to the expanding set of ESG expertise and solutions Nasdaq delivers to corporate issuers and other investment community stakeholders.

Annualized Recurring Revenue (ARR) for a given period is the annualized revenue of active Market Technology support and SaaS subscription contracts. ARR is currently one of our key performance metrics to assess the health and trajectory of our business. ARR does not have any standardized definition and is therefore unlikely to be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or to replace either of those items. ARR is not a forecast and the active contracts at the end of a reporting period used in calculating ARR may or may not be extended or renewed by our customers.

MEDIA RELATIONS CONTACT:

Allan Schoenberg

+1.212.231.5534

allan.schoenberg@nasdaq.com

INVESTOR RELATIONS CONTACT:

Ed Ditmire, CFA

+1.212.401.8737

ed.ditmire@nasdaq.com

Revenues:

Market Services

Transaction-based expenses:

Transaction rebates

Brokerage, clearance and exchange fees

Total Market Services revenues less transaction-based expenses

Corporate Services

Information Services

Market Technology

Other Revenues

Revenues less transaction-based expenses

Operating Expenses:

Compensation and benefits

Professional and contract services

Computer operations and data communications

Occupancy

General, administrative and other

Marketing and advertising

Depreciation and amortization

Regulatory

Merger and strategic initiatives

Restructuring charges

Total operating expenses

Operating income

Interest income

Interest expense

Net gain on divestiture of business

Other income

Net income from unconsolidated investees

Income before income taxes

Income tax provision

Net income attributable to Nasdaq

Per share information:

Basic earnings per share

Diluted earnings per share

Cash dividends declared per common share

Weighted-average common shares outstanding for earnings per share:

Basic

Diluted

MARKET SERVICES REVENUES

Equity Derivative Trading and Clearing Revenues

Transaction-based expenses:

Transaction rebates

Brokerage, clearance and exchange fees

Total net equity derivative trading and clearing revenues

Cash Equity Trading Revenues

Transaction-based expenses:

Transaction rebates

Brokerage, clearance and exchange fees

Total net cash equity trading revenues

Fixed Income and Commodities Trading and Clearing Revenues

Transaction-based expenses:

Transaction rebates

Brokerage, clearance and exchange fees

Total net fixed income and commodities trading and clearing revenues

Trade Management Services Revenues

Total Net Market Services revenues

CORPORATE SERVICES REVENUES

Listings Services revenues

Corporate Solutions revenues

Total Corporate Services revenue

INFORMATION SERVICES REVENUES

Market Data revenues

Index revenues

Investment Data & Analytics revenues

Total Information Services revenues

MARKET TECHNOLOGY REVENUES

OTHER REVENUES

REVENUES LESS TRANSACTION-BASED EXPENSES

Assets

Current assets:

Cash and cash equivalents

Restricted cash

Financial investments

Receivables, net

Default funds and margin deposits

Other current assets

Total current assets

Property and equipment, net

Goodwill

Intangible assets, net

Operating lease assets

Other non-current assets

Total assets

Liabilities

Current liabilities:

Accounts payable and accrued expenses

Section 31 fees payable to SEC

Accrued personnel costs

Deferred revenue

Other current liabilities

Default funds and margin deposits

Short-term debt

Total current liabilities

Long-term debt

Deferred tax liabilities, net

Operating lease liabilities

Other non-current liabilities

Total liabilities

Commitments and contingencies

Equity

Nasdaq stockholders’ equity:

Common stock

Additional paid-in capital

Common stock in treasury, at cost

Accumulated other comprehensive loss

Retained earnings

Total Nasdaq stockholders’ equity

Noncontrolling interests

Total equity

Total liabilities and equity

U.S. GAAP net income attributable to Nasdaq

Non-GAAP adjustments:

Amortization expense of acquired intangible assets ⁽¹⁾

Merger and strategic initiatives ⁽²⁾

Restructuring charges ⁽³⁾

Net gain on divestiture of business ⁽⁴⁾

Net income from unconsolidated investee ⁽⁵⁾

Extinguishment of debt ⁽⁶⁾

Other ⁽⁷⁾

Total non-GAAP adjustments

Non-GAAP adjustment to the income tax provision ⁽⁸⁾

Excess tax benefits related to employee share-based compensation

Total non-GAAP adjustments, net of tax

Non-GAAP net income attributable to Nasdaq

U.S. GAAP diluted earnings per share

Total adjustments from non-GAAP net income above

Non-GAAP diluted earnings per share

Weighted-average diluted common shares outstanding for earnings per share:

We amortize intangible assets acquired in connection with various acquisitions. Intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from our ongoing business operations.

We have pursued various strategic initiatives and completed acquisitions and divestitures in recent years which have resulted in expenses which would not have otherwise been incurred. These expenses generally include integration costs, as well as legal, due diligence and other third party transaction costs and will vary based on the size and frequency of the activities described above.

In September 2019, we initiated the transition of certain technology platforms to advance the company’s strategic opportunities as a technology and analytics provider and continue the realignment of certain business areas. Charges associated with this plan represent a fundamental shift in our strategy and technology as well as executive re-alignment and will be excluded for purposes of calculating non-GAAP measures as they are not reflective of ongoing operating performance or comparisons in Nasdaq’s performance between periods. For the three months ended March 31, 2020, we recorded $12 million in charges which primarily consisted of consulting services, asset impairment charges primarily related to capitalized software that was retired, and accelerated depreciation expense on certain assets as a result of a decrease in their useful life. For the three months ended December 31, 2019, we recorded $9 million in charges primarily related to severance and employee-related costs.

For the three months ended March 31, 2019, represents the pre-tax gain on the sale of our BWise enterprise governance, risk and compliance software platform.

In the relevant periods, primarily represents net income recognized from our equity interest in OCC. In February 2019, the SEC disapproved the OCC rule change that established OCC’s 2015 capital plan and OCC suspended customer rebates and dividends to owners. We were not able to determine the impact of the disapproval of the OCC capital plan on OCC’s 2018 net income until March 2019, when OCC’s 2018 financial statements were made available to us. As a result, in March 2019, we recognized $36 million of income relating to our share of OCC’s net income for the year ended December 31, 2018 as well as our share of OCC’s first quarter 2019 net income of $9 million. We also recognized our share of OCC’s net income of $17 million for the three months ended March 31, 2020 and $14 million for the three months ended December 31, 2019. We will continue to exclude net income related to our share of OCC’s earnings for purposes of calculating non-GAAP measures as our income on this investment will vary significantly compared to prior years. This will provide a more meaningful analysis of Nasdaq’s ongoing operating performance or comparisons in Nasdaq’s performance between periods.

Represents a charge recorded in connection with the early extinguishment of our 3.875% senior unsecured notes, primarily related to a premium paid for early redemption. This charge is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income.

For the three months ended March 31, 2020, other charges primarily included accrued expense associated with our donation to COVID-19 response and relief efforts, which is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income. For the three months ended December 31, 2019, other charges included costs for a tax reserve for certain prior year examinations, which is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income and certain litigation costs which are recorded in professional and contract services expense in the Condensed Consolidated Statements of Income.

The non-GAAP adjustment to the income tax provision primarily includes the tax impact of each non-GAAP adjustment. In addition, for the three months ended December 31, 2019, a tax benefit of $10 million was recorded, primarily related to an adjustment to the 2018 federal and state tax returns and for the three months ended March 31, 2019, a tax benefit of $10 million was recorded related to capital distributions from the OCC. See footnote 5 above for further discussion.

U.S. GAAP operating income

Non-GAAP adjustments:

Amortization expense of acquired intangible assets ⁽¹⁾

Merger and strategic initiatives ⁽²⁾

Restructuring charges ⁽³⁾

Extinguishment of debt ⁽⁴⁾

Other ⁽⁵⁾

Total non-GAAP adjustments

Non-GAAP operating income

Revenues less transaction-based expenses

U.S. GAAP operating margin ⁽⁶⁾

Non-GAAP operating margin ⁽⁷⁾

We amortize intangible assets acquired in connection with various acquisitions. Intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from our ongoing business operations.

We have pursued various strategic initiatives and completed acquisitions and divestitures in recent years which have resulted in expenses which would not have otherwise been incurred. These expenses generally include integration costs, as well as legal, due diligence and other third party transaction costs and will vary based on the size and frequency of the activities described above.

In September 2019, we initiated the transition of certain technology platforms to advance the company’s strategic opportunities as a technology and analytics provider and continue the realignment of certain business areas. Charges associated with this plan represent a fundamental shift in our strategy and technology as well as executive re-alignment and will be excluded for purposes of calculating non-GAAP measures as they are not reflective of ongoing operating performance or comparisons in Nasdaq’s performance between periods. For the three months ended March 31, 2020, we recorded $12 million in charges which primarily consisted of consulting services, asset impairment charges primarily related to capitalized software that was retired, and accelerated depreciation expense on certain assets as a result of a decrease in their useful life. For the three months ended December 31, 2019, we recorded $9 million in charges primarily related to severance and employee-related costs.

Represents a charge recorded in connection with the early extinguishment of our 3.875% senior unsecured notes, primarily related to a premium paid for early redemption. This charge is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income.

For the three months ended March 31, 2020, other charges primarily included accrued expense associated with our donation to COVID-19 response and relief efforts, which is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income. For the three months ended December 31, 2019, other charges included costs for a tax reserve for certain prior year examinations, which is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income and certain litigation costs which are recorded in professional and contract services expense in the Condensed Consolidated Statements of Income.

U.S. GAAP operating margin equals U.S. GAAP operating income divided by revenues less transaction-based expenses.

Non-GAAP operating margin equals non-GAAP operating income divided by revenues less transaction-based expenses.

U.S. GAAP operating expenses

Non-GAAP adjustments:

Amortization expense of acquired intangible assets ⁽¹⁾

Merger and strategic initiatives ⁽²⁾

Restructuring charges ⁽³⁾

Extinguishment of debt ⁽⁴⁾

Other ⁽⁵⁾

Total non-GAAP adjustments

Non-GAAP operating expenses

We amortize intangible assets acquired in connection with various acquisitions. Intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from our ongoing business operations.

We have pursued various strategic initiatives and completed acquisitions and divestitures in recent years which have resulted in expenses which would not have otherwise been incurred. These expenses generally include integration costs, as well as legal, due diligence and other third party transaction costs and will vary based on the size and frequency of the activities described above.

In September 2019, we initiated the transition of certain technology platforms to advance the company’s strategic opportunities as a technology and analytics provider and continue the realignment of certain business areas. Charges associated with this plan represent a fundamental shift in our strategy and technology as well as executive re-alignment and will be excluded for purposes of calculating non-GAAP measures as they are not reflective of ongoing operating performance or comparisons in Nasdaq’s performance between periods. For the three months ended March 31, 2020, we recorded $12 million in charges which primarily consisted of consulting services, asset impairment charges primarily related to capitalized software that was retired, and accelerated depreciation expense on certain assets as a result of a decrease in their useful life. For the three months ended December 31, 2019, we recorded $9 million in charges primarily related to severance and employee-related costs.

Represents a charge recorded in connection with the early extinguishment of our 3.875% senior unsecured notes, primarily related to a premium paid for early redemption. This charge is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income.

For the three months ended March 31, 2020, other charges primarily included accrued expense associated with our donation to COVID-19 response and relief efforts, which is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income. For the three months ended December 31, 2019, other charges included costs for a tax reserve for certain prior year examinations, which is recorded in general, administrative and other expense in our Condensed Consolidated Statements of Income and certain litigation costs which are recorded in professional and contract services expense in the Condensed Consolidated Statements of Income.

Market Services

Equity Derivative Trading and Clearing

U.S. equity options

Total industry average daily volume (in millions)

Nasdaq PHLX matched market share

The Nasdaq Options Market matched market share

Nasdaq BX Options matched market share

Nasdaq ISE Options matched market share

Nasdaq GEMX Options matched market share

Nasdaq MRX Options matched market share

Total matched market share executed on Nasdaq’s exchanges

Nasdaq Nordic and Nasdaq Baltic options and futures

Total average daily volume options and futures contracts ⁽¹⁾

Cash Equity Trading

Total U.S.-listed securities

Total industry average daily share volume (in billions)

Matched share volume (in billions)

The Nasdaq Stock Market matched market share

Nasdaq BX matched market share

Nasdaq PSX matched market share

Total matched market share executed on Nasdaq’s exchanges

Market share reported to the FINRA/Nasdaq Trade Reporting Facility

Total market share ⁽²⁾

Nasdaq Nordic and Nasdaq Baltic securities

Average daily number of equity trades executed on Nasdaq’s exchanges

Total average daily value of shares traded (in billions)

Total market share executed on Nasdaq’s exchanges

Fixed Income and Commodities Trading and Clearing

Fixed Income

U.S. fixed income volume (in billions)

Total average daily volume of Nasdaq Nordic and traded Nasdaq Baltic fixed income contracts

Commodities

Power contracts cleared (TWh) ⁽³⁾

Corporate Services

Initial public offerings

The Nasdaq Stock Market

Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic

Total new listings

The Nasdaq Stock Market⁽⁴⁾

Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic⁽⁵⁾

Number of listed companies

The Nasdaq Stock Market⁽⁶⁾

Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic⁽⁷⁾

Information Services

Number of licensed exchange traded products (ETPs)

ETP assets under management (AUM) tracking Nasdaq indexes (in billions)

Market Technology

Order intake (in millions)⁽⁸⁾

Annualized recurring revenues (in millions)⁽⁹⁾

Includes Finnish option contracts traded on EUREX Group.

Includes transactions executed on The Nasdaq Stock Market’s, Nasdaq BX’s and Nasdaq PSX’s systems plus trades reported through the Financial Industry Regulatory Authority/Nasdaq Trade Reporting Facility.

Transactions executed on Nasdaq Commodities or OTC and reported for clearing to Nasdaq Commodities measured by Terawatt hours (TWh).

New listings include IPOs, including those completed on a best efforts basis, issuers that switched from other listing venues, closed-end funds and separately listed ETPs.

New listings include IPOs and represent companies listed on the Nasdaq Nordic and Nasdaq Baltic exchanges and companies on the alternative markets of Nasdaq First North.

Number of total listings on The Nasdaq Stock Market at period end, including 412 ETPs as of March 31, 2020, 412 ETPs as of December 31, 2019, and 388 ETPs as of March 31, 2019.

Represents companies listed on the Nasdaq Nordic and Nasdaq Baltic exchanges and companies on the alternative markets of Nasdaq First North at period end.

Total contract value of orders signed during the period.

Annualized Recurring Revenue, or ARR, for a given period is the annualized revenue of Market Technology support and SaaS subscription contracts. ARR is currently one of our key performance metrics to assess the health and trajectory of our business. ARR does not have any standardized definition and is therefore unlikely to be comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenue and deferred revenue and is not intended to be combined with or to replace either of those items. ARR is not a forecast and the active contracts during the reporting period used in calculating ARR may or may not be extended or renewed by our customers.