Intercontinental Exchange Q4 2021 Earnings Results & Report

Intercontinental Exchange EPS Results

• Actual EPS: $1.34
• Consensus EPS: $1.32
• Beat/Miss: Beat by +$0.02
• One Year Ago EPS: $1.13
• EPS Beat Rate: 7 of last 8 quarters

Intercontinental Exchange Revenue Results

• Actual Revenue: $1.84 billion
• Expected Revenue: $1.82 billion
• Beat/Miss: Beat by +$16.84 million
• YoY Revenue Growth: +10.10%

Intercontinental Exchange (NYSE:ICE), Inc. (NYSE:ICE) is a global operator of exchanges, clearinghouses, data services and technology platforms. The company owns and operates the New York Stock Exchange and other exchanges serving equity, options, futures and over-the-counter markets. Its marketplaces support trading in areas including energy, agricultural commodities, interest rates, currencies, equity indexes and individual stocks.

ICE also provides clearing and settlement services that help manage counterparty and transaction risk, along with market data, analytics, connectivity and other technology solutions for financial institutions and businesses. Through ICE Mortgage Technology, the company offers software and workflow tools used in residential mortgage origination, servicing and related processes.

Founded in 2000 by Jeffrey Sprecher, Intercontinental Exchange expanded from an electronic energy marketplace into a diversified global financial markets and technology company. Its businesses serve customers across North America, Europe, Asia and other international markets. Sprecher serves as the company’s chair and chief executive officer, while the New York Stock Exchange remains one of its best-known businesses.

Intercontinental Exchange Q4 2021 Earnings Call Transcript

Key Takeaways

• ICE delivered record 4Q21 results with adjusted EPS of $1.34, up 17% year-over-year, and net revenues of $1.8 billion, a 10% increase marking the best quarter in company history.
• All three segments saw strong growth: Exchange revenues rose 17% to $1 billion (interest rates +71%, energy +29%), Fixed Income & Data Services revenues were up 7% to $480 million with 90% recurring, and Mortgage Technology recurring revenues grew 26%, outperforming a 30% industry decline.
• Full-year free cash flow hit a record >$2.8 billion, with $1 billion returned to shareholders via dividends and buybacks and gross leverage reduced to 3× EBITDA, a full year ahead of plan.
• For 2022, ICE expects core recurring revenues to grow 6–8% (after ~$30 million of FX and LIBOR headwinds) and forecasts adjusted operating expenses of $2.99–3.04 billion to fund strategic investments.
• Capital returns will accelerate with a 15% dividend increase to $0.38 per share and $475 million in Q1 share repurchases, a nearly 20% rise versus the prior comparable period.

Presentation

[Operator]

Good morning, and welcome to the Intercontinental Exchange Fourth Quarter 2021 Earnings Conference Call and Webcast. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star, then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press Star, then one on your telephone keypad. To withdraw your question, please press Star, then two. Please note this event is being recorded. I would now like to turn the conference over to Mary Caroline O'Neal, Head of Investor Relations. Please go ahead.

[Mary Caroline O'Neal, Head of Investor Relations at Intercontinental Exchange]

Good morning. ICE's fourth quarter 2021 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 a description of the risks that could cause our results to differ materially from those described in forward-looking statements, please refer to our 2021 Form 10-K 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 equivalent GAAP term in the earnings materials.

[Mary Caroline O'Neal, Head of Investor Relations at Intercontinental Exchange]

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 Gardiner, Chief Financial Officer, Ben Jackson, President, and Lynn Martin, President of the NYSE and Chair of Fixed Income and Data Services. I'll now turn the call over to Warren.

[Warren Gardiner, CFO at Intercontinental Exchange]

Thanks, MC. Good morning, everyone, and thank you for joining us today. I'll begin on slide four with some of the key highlights from our fourth quarter results. Adjusted earnings per share totaled $1.34, up 17% year-over-year, marking the best quarter in our company's history. Net revenues totaled a record $1.8 billion, an increase 10% versus last year. Total transaction revenues grew 11%, while total recurring revenues, which account for nearly half of our business, increased by 10%. Fourth quarter adjusted operating expenses totaled $749 million, slightly higher than expected, driven by additional severance as well as higher performance-based compensation due to the strong results to finish the year. Adjusted operating income increased by 14%, totaling a record $1.1 billion.

[Warren Gardiner, CFO at Intercontinental Exchange]

This strong operating performance contributed to a record full-year free cash flow of over $2.8 billion, of which we returned $1 billion to shareholders through dividends and buybacks, while also reducing our gross leverage to 3x EBITDA, nearly a full year ahead of schedule. Now let's move to slide five, where I'll provide an overview of the performance of our exchange segment. Fourth quarter net revenues totaled $1 billion, an increase of 17% year-over-year. This strong performance was driven by a 71% increase in our interest rate business and a 29% increase in our energy revenues, both driven in part by rising inflation expectations.

[Warren Gardiner, CFO at Intercontinental Exchange]

Revenues within our global oil complex increased 29% year-over-year, while natural gas and environmental products, which represent approximately 40% of our energy revenues, increased by 36% in the quarter and were up 20% for the full year. Recurring revenues, which include our exchange data services and our NYSE listings business, increased by 8% year-over-year, including 10% growth in listings. Turning now to slide six, I'll discuss our Fixed Income and Data Services segment. Fourth quarter revenues totaled a record $480 million, a 7% increase versus a year ago. Recurring revenue growth, which accounted for nearly 90% of segment revenues, also grew 7% in the quarter. Within recurring revenues, our Fixed Income, Data, and Analytics business increased by 6% year-over-year, including another quarter of double-digit growth in our index franchise.

[Warren Gardiner, CFO at Intercontinental Exchange]

While other data and network services grew 7%, driven by continued demand for ICE global networks and consolidated feeds offering. For the full year, data services revenue increased by 6%. Importantly, annual subscription value, or ASV, enters the first quarter up 5.5%, setting us up for yet another strong year of compounding revenue growth. Let's go next to slide seven, where I will discuss our Mortgage Technology segment. Fourth quarter mortgage technology revenues totaled $346 million. Recurring revenues, which accounted for over 40% of segment revenues, totaled $149 million and grew 26% year-over-year. While total mortgage technology revenues declined slightly, down 1% in the fourth quarter, we outperformed an industry that experienced a roughly 30% decline in origination volumes.

[Warren Gardiner, CFO at Intercontinental Exchange]

For the full year, mortgage technology revenues grew 17% on a pro forma basis, reaching $1.4 billion, well ahead of our initial expectations and on track to achieve our target of more than doubling revenues over a ten-year period. I'll conclude my remarks on slide eight with some additional guidance. We expect full-year total recurring revenues to be between $3.68 billion and $3.75 billion. This includes approximately $30 million of headwinds related to FX, the planned phase-out of Sterling LIBOR, and Euronext's post-Brexit decision to migrate certain connectivity services away from our U.K. data center and onto the continent. It is worth noting that the majority of Euronext connectivity revenues are expected to be offset by a related reduction in costs.

[Warren Gardiner, CFO at Intercontinental Exchange]

Adjusting for these items, we expect core growth in our recurring revenues, which again account for half of our business, to be approximately 6%-8% for the full year. This strong growth, which is on top of 10% growth last year, is expected to once again be led by our mortgage technology business, which we expect will grow in the low-to-mid teens, and importantly, is on top of an exceptional 30% growth in 2021. In addition, supported by an ASV that exits the fourth quarter up 5.5%, we anticipate another year of 5%-6% growth in our Fixed Income and Data Services recurring revenues. Moving to expenses. We expect 2022 adjusted operating expenses to be in the range of $2.99 billion-$3.04 billion.

[Warren Gardiner, CFO at Intercontinental Exchange]

Consistent with prior years, we will reward our employees for their contributions to our strong results, and therefore expect compensation expense, net of synergies and the resetting of 2021 performance awards, to increase by $25 million-$35 million. Expenses tied to revenues are also expected to increase by $25 million-$35 million, driven by higher license fees, as well as investments in business and product development across all three of our segments. In addition, we expect an incremental $40 million-$60 million in support of productivity and efficiency initiatives across our technology and operations groups, a portion of which we are electing to fund through the net operating savings we realized following the IPO of Bakkt. Lastly, and similar to last year, we expect roughly $30 million of incremental D&A expense related to purchase accounting and the rebuild of Ellie Mae CapEx.

[Warren Gardiner, CFO at Intercontinental Exchange]

Please see slide 12 in the appendix for a bridge reconciling our expense guidance to 2021. Moving next to capital allocation. Consistent with our track record of growing our dividend as we grow, we plan to increase our quarterly dividend by 15% year-over-year from $0.33 per share to $0.38 per share. In addition, now that we are within our targeted leverage range, we expect to deploy approximately $475 million towards share repurchases in the first quarter, representing a nearly 20% increase versus the second quarter of 2020, the last full quarter of buybacks prior to our acquisition of Ellie Mae. In summary, we delivered a record finish to another record year. We delivered double-digit growth in revenue, operating income, and earnings per share.

[Warren Gardiner, CFO at Intercontinental Exchange]

We also invested in an array of future growth initiatives, increased our dividend double digits, and achieved our leverage target a year earlier than originally planned. As we kick off 2022, we're focused on, once again, delivering growth and creating shareholder value against what is an ever-evolving macro backdrop. I'll be happy to take your questions during Q&A, but for now, I'll hand it over to Ben.

[Ben Jackson, President at Intercontinental Exchange]

Thank you, Warren, and thank you all for joining us this morning. Please turn to slide nine. We are pleased to report another record year for ICE. Our strong financial results reflect the tremendous efforts of my colleagues across the organization, the trust and expanding relationship we have with our customers, and the ability of our business model to drive growth across a variety of macroeconomic environments. I'd like to focus on the secular trends that are driving growth across our mortgage and energy markets, and will turn it over to Lynn to discuss our position across Fixed Income, data and analytics, and some highlights from our great year at the NYSE. Our data, technology, and network expertise position us well to accelerate the analog-to-digital conversion happening across the mortgage industry.

[Ben Jackson, President at Intercontinental Exchange]

As mortgage origination costs continue to increase, electronification is a trend we believe will continue in a variety of interest rate environments and regardless of mortgage origination volumes. Our ability to capture this secular trend is evidenced by the strength and resiliency of our recurring revenues. Part of that growth is driven by our strategy to intentionally shift more business to recurring revenue. We also continue to see strong sales and new customers coming onto the platform. With connectivity to nearly every participant in the mortgage industry, we have the opportunity to cross-sell new products like eClose and AIQ to a captive customer base seeking efficiencies. This flywheel effect and the secular trend of electronification give us confidence in our ability to grow this business and capture the $10 billion addressable market.

[Ben Jackson, President at Intercontinental Exchange]

Across our energy markets, we achieved record volumes in 2021, including in Brent, TTF, and environmentals. The breadth and depth of our platform not only drove strong volumes and revenues, but more importantly, it positions us to capture secular tailwinds across our energy complex, including the globalization of natural gas and the clean energy transition. We have built a global natural gas business, including our European marker, TTF. The globalization of natural gas and the rise of LNG have driven TTF to emerge as the global gas benchmark. In 2021, record volumes on our platform grew 45% and drove revenue growth of 36%.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Our markets continue to be relied on by an increasing number of participants to manage risk and navigate volatile gas and power markets. We were also early to diversify into environmentals, acquiring the Climate Exchange in 2010, and building around those leading markets to develop a global environmental business. In 2021, we reached record volumes across the complex, including in our E.U., U.K., renewable greenhouse gas initiatives, and California carbon allowances. These record volumes contributed to a 56% increase in environmental revenues versus the prior year. As customers navigate the uncertainty and volatility related to the clean energy transition, we are well-positioned as the venue of choice to manage risk and provide price transparency across the energy spectrum. With that, I'll now turn the call over to Lynn.

[Lynn Martin, President of NYSE Group and Chair of Fixed Income and Data Services at Intercontinental Exchange]

Thank you, Ben. With data and technology at our core, our goal is to provide solutions which add transparency to both commonly understood risks as well as emerging risks such as ESG. We continue to increase the breadth and coverage of our products and accelerate the delivery of our ESG reference data to the NYSE issuer community, providing non-opinion-based insights to market participants. In the fourth quarter, we expanded our climate change and alternative data capabilities with the acquisition of risQ and Level 11 Analytics. Combining geospatial data technology with our financial data will bring greater transparency to ESG risks across the financial markets, including our existing muni bond and mortgage-backed security offerings. Our data, technology, and leading marketplaces position us well to benefit from the secular trend towards sustainability and net zero carbon commitments. Turning now to Fixed Income.

[Lynn Martin, President of NYSE Group and Chair of Fixed Income and Data Services at Intercontinental Exchange]

Increased automation, flexibility of delivery, and passive investing continue to drive demand for our proprietary data and rapidly growing index business. As a leading data provider to the Fixed Income market, we are uniquely positioned to drive automation. Leveraging our proprietary evaluated prices, analytics, and our growing suite of reference data, we've taken a business that historically served the back and middle office and created tools and analytics for the front office. These tools are critical to the pre-trade transparency needed in the opaque, less liquid Fixed Income markets, as is evidenced by our front-office tools continuing to grow double digits. The growth in passive investing continues to be a tailwind for our business.

[Lynn Martin, President of NYSE Group and Chair of Fixed Income and Data Services at Intercontinental Exchange]

The flexibility of our tools, quality of our pricing data, and flexibility of our offering directly contributed to the five asset managers, with funds of over $66 billion of AUM that transitioned to ICE indices during 2021. An additional group of funds with AUM of $6.7 billion have planned transitions during Q1 2022. This strength drove double-digit revenue growth in our index business for the fourth consecutive year and positions us well for continued growth. I'll close with some highlights from the NYSE. 2021 was a record year for NYSE listings. We helped connect innovators and entrepreneurs to nearly $120 billion in capital through 297 IPOs, including three of the four largest IPOs and the three largest tech IPOs.

[Lynn Martin, President of NYSE Group and Chair of Fixed Income and Data Services at Intercontinental Exchange]

Importantly, we continue to lead the market in ETF listings, with more than 65% of new funds selecting us as their home. We also continue to prioritize our market-leading technology, which enables customers to better manage risk and provide our issuer community with significantly less volatility at the open and the close. The performance of our technology was proven as recently as last week, when we processed nearly 500 billion messages in a single day, with median response times of less than 30 microseconds across our equities complex, further cementing our position as the leading equity exchange group. Our leading data and technology, coupled with our investments in sustainable finance, the secular trends across fixed income markets, and the competitive differentiators of the NYSE will continue to drive our growth well into the future. I'll now turn the call over to Jeff.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Thank you, Lynn, and thank you all for joining us this morning. Please turn now to slide 10. 2021 marked our sixteenth consecutive year of record revenues and record-adjusted earnings per share. This track record of growth reflects our strategy to diversify the business and position the company at the center of some of the largest markets undergoing an analog-to-digital conversion, a strategy that has made ICE an all-weather name, a business model that provides upside to volatility with less downside risk, and importantly, a positioning that drives growth on top of growth. We have intentionally diversified across asset classes so that we are not tied to any one cyclical trend or one macroeconomic environment. For example, in 2021, we saw record volumes across our energy complex, driven in part by inflationary concerns and market speculation of central bank activity.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Our European and UK interest rate business also benefited from interest rate volatility, driving a 15% increase in revenues in 2021, and more recently, a 34% increase in our January revenues. Our CDS clearing business grew 14% in the fourth quarter as rate volatility increased, driving demand for risk management and credit protection. Even against this backdrop of rising interest rates, our mortgage technology business outperformed the broader market, including pro forma recurring revenue growth in 2021 of 31%. Again, a reflection of the all-weather nature of our business model. As we begin 2022, we are better positioned than ever to capitalize on the secular and cyclical trends occurring across asset classes, and we remain focused on investing and executing on the many growth opportunities in front of us.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Before we end our prepared remarks, I'd like to thank our customers for their business and their trust in 2021, and I'd like to thank my colleagues at ICE for their continued efforts. Your hard work contributed to the best quarter in our company's history, combined with other excellent results, making it the best year in our company's history. With that, I'll now turn the call back to Andrew, our operator, to conduct the question and answer session until 9:30 Eastern Time.

[Operator]

Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. Please limit yourself to one question, and if you have a follow-up, you may rejoin the queue. At this time, we will pause momentarily to assemble our roster. The first question comes from Rich Repetto with Piper Sandler. Please go ahead.

[Rich Repetto, Managing Director at Piper Sandler]

Yeah. Good morning, guys. Good morning, Jeff. My question is on the recurring revenue growth for mortgage. You know, if it was up 31% and now you're guiding to, I think low double digits, I, you know, could you give us more color on that? Is that just the law of large numbers? Any progress on metrics to sort of that we can monitor that, you know, that recurring revenue in mortgage? And then lastly, Jeff, I know you talked about the offset, but how do you think about the offset going forward? Is it simply interest rate futures, you know, offsetting, you know, what looks like, you know, a slowdown in origination volumes going forward?

[Ben Jackson, President at Intercontinental Exchange]

Hi, Rich. It's Ben. I'll start here. You hit on it a bit in the way you answered the question. You do have growth compounding on top of growth there in the subscription side of the business. Also, I mean, we are looking at macro headwinds. I mean, Warren brought up in his commentary that if you take a composite of where the industry analysts have volumes, that you have volumes down 30%. In that environment, we could see some macro headwinds, such as, are there gonna be a bunch of brand-new originators coming onto the scene? You know, potentially not. Could you see some industry consolidation? You know, potentially we'll see some of that.

[Ben Jackson, President at Intercontinental Exchange]

Despite those types of headwinds, you know, we see an opportunity to grow this subscription business in the teens because we have great visibility to a phenomenal new business pipeline of new customers that, you know, we're looking at right now. We have the ability to cross-sell to that large stable of customers that we have solutions like our AIQ business that will provide them more efficiency, as well as our industry-leading point-of-sale solutions. The other dynamic that we have going on is that move towards subscription as customers renew. You know, we had a pilot program last year where we have roughly 20% of our customers renew in a given year. With a small percentage of those that renewed last year, we looked at shifting them more towards subscription.

[Ben Jackson, President at Intercontinental Exchange]

We're successful doing that, and we've codified a program of this year to hit a much larger percentage of the roughly 20% that are renewing this year. All of those, we believe, are tailwinds to offset the macroeconomic environments there and will lead to a teens growth in subscription revenue, which we feel great about.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Rich, this is Jeff. Yeah, you know, we've really thought hard over the last few years on how to position the company to be an all-weather name that will just grow on top of growth and in all macro environments and global geographies. You know, our thinking is that inflationary pressures are what drive central banks to raise interest rates.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

We have a lot of asset classes that we participate in and positioning of the company that will benefit from that volatility. You know, we tend to see commodity businesses like energy and agricultural commodities be very volatile in inflationary environments. Therefore, there's a lot of hedging and we help people manage that risk. Similarly, obviously, in our interest rate businesses, which include interest rate futures and credit default swaps and Fixed Income Data and Services, in a volatile interest rate environment, those businesses do well. Even in the mortgage space, as Ben's been talking about, you know, home inflation tends to drive people to do cash-out refinancings, which for us, refinancing a house versus buying a new house is the same transaction to our mortgage platform.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

We really feel like we've positioned the company well in this environment. We also feel like we position the company well if there isn't inflation, if there isn't a lot of central bank activity. You know, the low interest rate environment is where we always felt vulnerable. We've really done a number of things over the last few years that augment that base. We hope you, in thinking about our company, will feel like, you know, you can safely purchase the stock for upside growth but limit your downside risk. That's really how, you know, as managers, we've tried to position our company today.

[Rich Repetto, Managing Director at Piper Sandler]

Thanks, Jeff. That very helpful. The call was helpful. Thank you.

[Operator]

The next question comes from Dan Fannon with Jefferies. Please go ahead.

[Dan Fannon, Managing Director and Research Analyst at Jefferies]

Thanks. Good morning. My question's on the environmental complex, and wanted to think about the size of that market and maybe if you could address the customer base there, commercial versus financial, kind of utilization and as we think about it versus some of your mature markets to kind of get a sense of where we are in the adoption phase of some of these products.

[Ben Jackson, President at Intercontinental Exchange]

Hi, Dan, this is Ben. I'll take this one. We've been spending a lot of time thinking about this in terms of the size of that marketplace. When we look at any of our derivatives markets, we look at the underlying physical market as really a proxy for it. The estimates out there are that in any given year, you have around 50 billion tons of carbon that's emitted into the atmosphere around the world. In the geographies where we're very strong and present right now, so take North America, the EU and the U.K., those geographies alone emit about 11 billion tons of carbon.

[Ben Jackson, President at Intercontinental Exchange]

What we've seen in terms of the derivatives markets as they mature is that it's common to see a derivatives market that would trade on top of the physical of around 10 times, if not more. If you just use 10 times as that market matures as the proxy for how you define a TAM in the markets that we are today, that's around a hundred and ten billion tons equivalent of physical that can trade. Today, in the marketplaces that we're strong, we traded 18 billion tons, so we've hit about 16% of that TAM. Obviously with that, there's a long runway to go in the geographies where we're strong today.

[Ben Jackson, President at Intercontinental Exchange]

What will help feed that growth is more sectors of the economy coming in and trading these products as well as voluntarily more companies that are measuring their scope one, two, and three emissions coming in and also trading in those geographies. That adds more participants, it adds more sectors of the economy and will lead to more you know more transactions going on in the derivatives markets. The other obvious area of growth is just more geographies around the world and global programs, if they do come in place, will increase the size of that physical market.

[Ben Jackson, President at Intercontinental Exchange]

Given that we represent around 95% of the world's trading that happen on our venues, we think we're very, very well positioned to capture that growth opportunity and that TAM that I just outlined.

[Dan Fannon, Managing Director and Research Analyst at Jefferies]

Thank you.

[Operator]

The next question comes from Alex Kramm with UBS. Please go ahead.

[Alex Kramm, Managing Director and Senior Equity Research Analyst at UBS]

Yeah. Hey, good morning, everyone. Wanna ask about inflation broadly. It's been a big topic, obviously, this earnings season in the last few months for a lot of companies. Seems like on the cost side, you're managing that pretty well. I'm more interested on the revenue side. I mean, 50% of your business or so is subscription-based. So curious to what degree CPI is built into any of your subscriptions, to what degree that could help you or make pricing discussions easier. Of course, how much of that is baked into your recurring revenue forecast broadly? Thank you.

[Warren Gardiner, CFO at Intercontinental Exchange]

Yeah. It's Warren. Yeah, there is an element of that to some extent, particularly on the CPI, that is, in terms of building some of the data contracts. I wouldn't say it's necessarily a huge part of it, but again, that's gonna be built into part of our guide there when we talk about 5%-6% for the year. I think on the revenue side, really the more it's what Jeff and Ben have been talking about in terms of our exposure, if you will, to inflation, and that's really gonna come down to the commodities business, the interest rate business, which is off to a great start in January, the CDS business, the ags business within that commodities business.

[Warren Gardiner, CFO at Intercontinental Exchange]

I think that's really more in terms of our leverage to inflation expectations, if you will, on the revenue side. On the cost side, you're right. You know, there certainly we were seeing some pockets of it. It's third party kind of services as you would imagine, or pricing providers or things like that nature, things like utility costs, some technology costs like cloud providers and things like that that we're seeing some uptick on. But again, that's all baked into our guidance, you know, that we provided you today. I think on the comp side, the way to be thinking about that is, look, we've always been a pay-for-performance culture. You know, we obviously had a really good year this year.

[Ben Jackson, President at Intercontinental Exchange]

We always wanna monitor and retain kind of the best talent that's out there. You know, I think we have built up some goodwill, if you will, you know, both with employees and potential employees from that perspective. We're comfortable with that position on the comp side. Again, all that's baked into our expense guidance for the year as you saw.

[Alex Kramm, Managing Director and Senior Equity Research Analyst at UBS]

Fantastic. Thank you, guys.

[Operator]

The next question comes from Kenneth Worthington of JPMorgan. Please go ahead.

[Kenneth Worthington, Senior Analyst at JPMorgan]

Hi, good morning. Jeff, I wanted to pick your brain a little bit about crypto and blockchain, acknowledging that you and ICE were early in seeing the potential here with Bakkt and other investments. As we think about the mortgage process, is there a role you see for blockchain technology helping ICE digitize parts of the mortgage process or getting you know, closer to your vision in the mortgage area? It would seem like the information is indelible there to some of your comments at Alex's conference late last year. Second, the crypto trading ecosystem is developing in a much more vertically integrated way. Do you see the crypto ecosystem moving more towards specialization over time, like the cash equity world?

[Kenneth Worthington, Senior Analyst at JPMorgan]

Is the chance that the cash equity ecosystem might evolve to look more like the crypto ecosystem? Does either of these have implications for the New York Stock Exchange?

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Those are two really thoughtful questions. Thank you for those, Ken. First of all, you know, when we think about the blockchain, we think about its main value. Well, it has two values in our mind. The main value is it creates an indelible record. To a certain extent, property rights are something that society views as an indelible record, and it's why we have title insurance, for example, in mortgages so that we have an insurance wrapper around, you know, title to a property. You can imagine that an indelible record that's accessed by many, many people that would ensure property rights for both mortgages or homes or any other asset is something that could grow.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

It's an area that we definitely are focused on. The second attribute of blockchain and the broader cryptocurrency environment is that it has captured mind share and has really been used as a marketing tool to move people from more analog brokerage houses to more digital brokerage houses and give customers direct access. Those brokerages that didn't engage their customers digitally are seeing themselves somewhat being disintermediated by new brokers that are digital. The interesting thing about your question, the third part of your question, which is really what do regulators wanna do about this?

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Largely speaking, our whole infrastructure for regulation in the Western world has been that there is a broker that has a customer relationship, and they have the KYC and AML responsibility for their customers. They have to know their customers, and they have to do anti-money laundering checks and balances. Once having done that, they can then access the broader market. There's been a blurring in the crypto space between the obligations of a broker-dealer and the obligations of an exchange and the obligations of clearinghouse. Generally speaking, in the organized clearing markets, there are intermediaries that are providing credit amelioration to the customer, and it is the collective balance sheet of all of those brokers and clearing firms that backstop the market. In the case of some of the crypto companies, that is not the case.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

You know, if those comp... If regulators decide to subject, you know, the straight-through processing companies to the same terms and conditions that they have subjected historical companies, those companies have some work to do around KYC, AML, and credit intermediation, and passing the IOSCO standards of a clearinghouse that has to be stress testing, which, you know, essentially is banking. If the regulators say, "You know what, maybe those issues aren't as important as we had thought they were, and maybe, you know, having the consumer directly participate end-to-end is a better way," then you are gonna see the legacy companies in our industry move more to opening up their clearinghouses to end users and opening up their platforms, matching engines and other platforms directly to end users and bypassing the brokerage community.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

I think it's too soon to predict what will happen there, but you can, you know, to the extent that I've helped, you know, your thinking at all, you'll see now as you read articles about what the various regulators are doing and saying that that is the essential question that they're wrestling with. Do they bring the legacy business towards the crypto space, or do they bring the crypto space into the legacy business? I'd make one last comment, which is, you know, largely speaking, in the United States, we're subject to the Securities Exchange Act of 1934. That act has withstood a lot of change in technology and in market structures and what have you.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Based in the 1934 Act is the customer protection and fraud protection, and I suspect that notwithstanding, there's a lot of people wanting the '34 Act to be updated. There's a lot of tools in the 1934 Act for regulators to even deal with new technologies as they have done now over decades. Thank you for those questions. They're very thoughtful.

[Kenneth Worthington, Senior Analyst at JPMorgan]

Thank you, Jeff.

[Operator]

The next question comes from Michael Cyprys with Morgan Stanley. Please go ahead.

[Michael Cyprys, Executive Director of Equity Research (Financials) at Financials]

Hey, good morning. Thanks for taking the question. I just wanted to ask about the cloud. I was hoping you might be able to remind us which parts of your business today are on the cloud, and as you look forward, how do you think about the opportunity for migrating more of your business to the cloud? What benefits could you see and which parts of the organization can make sense to do sooner versus which ones do you think would take a bit more time?

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

It's a great question. We first of all use the cloud and are active in the cloud in a lot of our businesses. The main attribute that the cloud brings us is it's just another network where customers can get access to our products. We also run our own data centers, and we have our own network, and we're hooked to a lot of third-party networks, and by the way a lot of third-party screen providers and platform providers. You know, the cloud's important to us to the extent that we have clients that would prefer to receive services from us in the cloud.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Where it is not as important to us is because of our scale and size, we're better able to control our costs when we're managing our own technology and network infrastructure. We have done a lot of analysis around this and if as I think Warren mentioned in his remarks to one of the inflationary questions, probably the highest inflation pressure that we're seeing right now is in the services that are in the cloud. We don't have good moats around our ability to control those costs, notwithstanding. If clients, however, want to bear those costs, we're happy to provide them access through the cloud. I think you'll see it as an important but augmentative service that we have, not necessarily the key service.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Last thing I would mention to you is I think we're different than some of our peers in that we have always felt that the way to control costs is to control our technology. It's not something that, you know, at its core that we license to others. It's not something at its core that we get from others, and it's not something at its core that we run in other people's infrastructures.

[Michael Cyprys, Executive Director of Equity Research (Financials) at Financials]

Great. Thank you.

[Operator]

The next question comes from Alex Blostein with Goldman Sachs. Please go ahead.

[Alex Blostein, Managing Director of Equity Research at Goldman Sachs]

Hey, guys, it's Alex. I wanted to go back to the mortgage question for a second. You gave some color about 2022 specifically, but you know, clearly it's a pretty meaningful slowdown in growth and recurring revenues into low-to-mid teens% from, you know, well north of 20% over the last twelve months. Do you think this is just a 2022 dynamic, and the reasons you sort of described earlier just really kind of relate to the next twelve months? Or, for a variety of reasons, this is more of a reasonable runway we should expect over the medium term? Thanks.

[Ben Jackson, President at Intercontinental Exchange]

Hey, Alex. This is Ben. When you look at that macro environment, and again, Warren used that composite estimate of around a backdrop of the business being down or sorry, not the business, but the overall transaction volumes being down 30%. When I look at our strategy for this business in each of the segments that we have in this business, we are executing very, very well. What's the evidence to that? Look at each of the segments underneath there. Despite that volume decline, our data and analytics business grew year-over-year. We've talked on a number of these calls on how we see that playing out over time, and that will continue to be a growth driver as more of our customers adopt automation.

[Ben Jackson, President at Intercontinental Exchange]

We also have our closing line item that's grown year over year as we've invested a lot, did a lot of brand new innovations that the industry has not seen before over this past year. As customers ramp on those, we're starting to see some substantial ramp up on that, and that's leading to growth in that line item year over year. On the origination line item, we way outperformed what industry transaction volumes were. Underneath the covers there, it's an explicit move towards more and more subscription. We feel great about how the business is executing despite this, you know, near-term drop in volumes. It's hard to predict how long the drop in volumes will play out.

[Ben Jackson, President at Intercontinental Exchange]

We feel good on our ability to grow this business and to outperform the industry backdrop based on our strategy in each one of those. Remember on the. You know, we just started that pilot program that was, you know, last year in terms of as every customer renews for a small percentage of them, we're shifting the revenue more and more towards subscription. Roughly 20% renew in a given year. This year, we've really codified a program to hit a much larger percentage. We have a long runway. I mean, doing the math, we have a long runway to execute that over many years that we believe will continue to lead to, you know, growth in that subscription line item.

[Alex Blostein, Managing Director of Equity Research at Goldman Sachs]

All righty. Thank you.

[Operator]

The next question comes from Brian Bedell with Deutsche Bank. Please go ahead.

[Brian Bedell, Director at Deutsche Bank]

Great, thanks. Good morning, folks. Maybe Ben, if I could just come back to the environmental complex question and your answer to a prior question on that. Two-parter. First on the 110 billion tons of physical TAM that you mentioned. Just wanted to clarify if that is a sort of a current TAM and then your expectations for that to grow over time as we move more into carbon transition. Then secondarily, looks like the environmental complex is now, you know, north of 10% of your energy revenue. Nat gas is also inching up as well, 25% or so.

[Brian Bedell, Director at Deutsche Bank]

What is your view on nat gas as a transition energy and whether, you know, if we wanna think about a long-term carbon transition, should we be thinking about that nat gas to grow as a portion of your total energy revenue, just like the environmental has grown?

[Ben Jackson, President at Intercontinental Exchange]

Yes. Okay. Thanks, Brian. On that 110 billion tons of physical equivalent traded. The estimate I used there, that's again, just based on the geographies where we are now. That's North America, EU and U.K., and putting a 10x multiple on that. As you picked up there in the way you asked the question, that's as markets are maturing, we see it can get to 10%, but even order of magnitude more than that. If you take very well-established benchmarks, it can be 2x-3x that easily. We see this as a market that as it matures, can get bigger than that. I see that as more of kind of a near to medium-term TAM that can be achieved in that environmental markets.

[Ben Jackson, President at Intercontinental Exchange]

Also as more geographies get added around the world and as more of the overall $50 billion or 50 billion tons of carbon emissions that are happening around the world, as more of that, more of that adds more programs, and as more governments around the world add programs, we have an opportunity to go after that as well. There's an acceleration that could happen on that over time. On the nat gas, you pointed out, you know, environmental is at 10%, natural gas also continuing to grow. Our natural gas business is really the only global gas business around the world. Our TTF business continues to grow on top of growth.

[Ben Jackson, President at Intercontinental Exchange]

You're seeing that continue to compound and customers coming to us around the world to manage their risk and using natural gas as the cleanest of the fossil fuels to help with this energy transition. With a backdrop of industry estimates saying that energy demand is likely to double between now and 2050, we see that that's going to be an important element in this transition towards a cleaner environment, and that this transition is going to be bumpy. We're pleased to see that our customers are coming to us as much as ever to manage their risk in that environment.

[Brian Bedell, Director at Deutsche Bank]

Great. Thank you.

[Operator]

The next question comes from Owen Lau with Oppenheimer. Please go ahead.

[Owen Lau, Senior Analyst at Oppenheimer]

Good morning, and thank you for taking my question. Could you please talk about your balance sheet investment? What's your plan to, like, maybe deconsolidate OCC and BEG, or you will be more opportunistic to leverage your balance sheet to make additional investments? Thank you.

[Warren Gardiner, CFO at Intercontinental Exchange]

Hey, Owen, it's Warren. With respect to Bakkt, as you probably recall, we did deconsolidate that in the fourth quarter. It went public, I recall, in October. That certainly is we have a stake that's on our balance sheet. That's an investment we've been making over a number of years that, you know, we've been very happy with and have a lot of confidence in the outlook for that business. I don't think there's anything to update there in terms of any kind of plans on that front. With respect to OCC, that is something that's on our balance sheet. You know, I don't recall the exact mark of it, but it's a small investment that we have there.

[Warren Gardiner, CFO at Intercontinental Exchange]

You know, we'll see if there's any opportunity there. I wouldn't necessarily say that that's something we're thinking about at the moment. Certainly, you know, it's part of what we do in the options and equities side to begin with, so I wouldn't be thinking about that. We do over time, you know, as you know, with Euroclear and some of the other investments, we do look for opportunities that are, you know, sort of adjacent to what we do in our business. We will look for those opportunities and invest in those as we see them. I think you could expect us to continue to do that when those opportunities arise.

[Warren Gardiner, CFO at Intercontinental Exchange]

Those will be sort of minority investments, small minority investors for the most part, as you've seen with some of the ones we've done in the past.

[Owen Lau, Senior Analyst at Oppenheimer]

All right. Thank you.

[Operator]

The next question comes from Kyle Voigt with KBW. Please go ahead.

[Kyle Voigt, Managing Director of Equity Research at KBW]

Hi, good morning. I just wanted to ask a question, still on the energy topic, specifically on Brent, and Brent open interest. We're seeing nice growth in the options OI in that complex, but Brent futures open interest specifically was down 17% year-over-year as of earlier this week. I guess with the price volatility we've seen in the oil market over the past year, just would have expected to see a bit stronger trends there. Just wondering if you could kind of opine on whether you think this is cyclical, still related to kind of COVID normalization or whether there's something, you know, more secular going on there that's causing the decline, would be helpful. Thank you.

[Ben Jackson, President at Intercontinental Exchange]

Thanks, Kyle. We do see this as, you know, as temporary. If you look at Brent overall open interest, you know, today is about 5% over last year. You got to remember, last year was also another very volatile year where we saw tremendous growth in that business. Yeah, you are looking at a compare that's difficult, but on top of that, we're, you know, still growing that business nicely. In addition, in oil overall, we have had a lot of success working with many of the physical industry participants in some brand-new innovations and ways for them to help manage their risk in the oil markets.

[Ben Jackson, President at Intercontinental Exchange]

The example would be ICE Futures Abu Dhabi that we launched last year to help people hedge and come up with a market price for hedging Murban crude oil that's going to Asia. Just within two weeks ago, we launched our new HOU contract, which is Midland WTI American Gulf Coast contract, where we were selected by the industry to come up with a better way to price Midland WTI as it gets to the Gulf and is going overseas. Both of those contracts have seen tremendous amount of pickup in physical market participants supporting it in early days. We see those as highly complementary to the overall Brent complex. It's an area we're going to continue to invest.

[Ben Jackson, President at Intercontinental Exchange]

We, you know, we do see the COVID environment and you know, jurisdictions and geographies opening and closing, opening and closing, unfortunately, does create some gyrations in here. But overall, we feel great about the oil complex.

[Kyle Voigt, Managing Director of Equity Research at KBW]

Understood. Thank you.

[Operator]

The next question comes from Craig Siegenthaler with Bank of America. Please go ahead.

[Analyst at Bank of America]

Hey, guys. Good morning. This is Eli on for Craig. I had a question for you on December's leadership changes. Should we see those as a precursor to more meaningful strategy changes at NYSE, or do you anticipate any changes will be more incremental? Specifically on listings, has the new team given any thought to lowering listing standards to help make the New York Stock Exchange a little more competitive in 2022, or maybe pivoting the brand to better appeal to all the new tech companies coming to public markets? Thanks.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Sure. Good question. This is Jeff. You know, I'm surrounded by a generation that's younger than me that's incredibly talented, that's delivered this best year in our history. Those changes were an opportunity to start to put leaders, you know, in that generation. Because the company is so broad now and so geographically diverse, we're trying to give people in that leadership team opportunities to try their skills in different businesses and give them exposure to the markets. I was thrilled to be able to ask Lynn Martin if she would lead the New York Stock Exchange, and I'll let her tell you what she's thinking.

[Lynn Martin, President of NYSE Group and Chair of Fixed Income and Data Services at Intercontinental Exchange]

Yeah. Thanks. Thanks, Jeff, and thanks for the question. I mean, you know, it's early days of me being in the seat at NYSE, but I continue to see great opportunity to further cement NYSE as the home of global markets. You know, as I think about this year, we've got a healthy pipeline of IPOs, although the timing of some of the companies coming to market is shifting a bit given the macroeconomic environment. Importantly, we really see the environment changing and the drivers of capital raising last year may have favored our competitors, but we see that shifting given the strength of our model.

[Lynn Martin, President of NYSE Group and Chair of Fixed Income and Data Services at Intercontinental Exchange]

The issuers that I've been talking to more recently, CEOs that are looking to come to market, they're valuing different things, and they're valuing stability and trading, lower cost of capital and strong governance, and that really favors the NYSE market model. Now, our message around our market model, the differentiation and investment we've made in technology and also the broader technology assets that we're bringing to bear through the various other ICE businesses are really resonating as differentiators for the New York Stock Exchange.

[Analyst at Bank of America]

Got it. Thanks.

[Operator]

The next question comes from Simon Clinch with Atlantic Equities. Please go ahead.

[Simon Clinch, Research Analyst at Atlantic Equities]

Hi, guys. Thanks for taking my question. Just a bit of housekeeping really on the CapEx guidance. I just wonder if you could give us a bit more color as to how to think about CapEx going forward, and particularly what's really driving that growth if you can tease out sort of the separate drivers for fiscal 2022.

[Warren Gardiner, CFO at Intercontinental Exchange]

Sure. Hey, Simon, it's Warren. Right, we were about $450 million, as you know, this year. That was kind of towards the high end of the range. Some of that is related to Bakkt. We, of course, had a full year of Ellie Mae. You know, as you're looking at the guidance for next year, as you saw, it's about $490 million-$520 million. We are planning some data center migrations and some upgrades. That's adding about $80 million or so to that $490 million-$520 million. Those are gonna result eventually in some cost savings. There's revenue-related expansion project within that. All kind of good things on the back end of that investment.

[Warren Gardiner, CFO at Intercontinental Exchange]

You know, within that guidance range of this year, probably around $100 million of Ellie Mae, too. You know, when you start to back peel off those pieces, well, you're back down to sort of the $300-$350 range, which is where we'll call it legacy ICE was and has been for a number of years prior to that acquisition and some of these, you know, productivity and efficiency investments that we're gonna be making around some of the data center moves.

[Simon Clinch, Research Analyst at Atlantic Equities]

Great. Okay. Thank you.

[Operator]

We have a follow-up from Alex Kramm with UBS. Please go ahead.

[Alex Kramm, Managing Director and Senior Equity Research Analyst at UBS]

Yes. Hey again. Just a couple of quick follow-ups here. One on the mortgage side, maybe I missed it, but can you give us an update in terms of where you stand with subscribers on eClose? And then also where we are in the subscription kinda like transition in terms of how many of your clients have now transitioned. I know it's about 20% a year, but just maybe an update there. And then also on the trading side, very quick, obviously with the contract transitions here in EURIBOR, obviously the rate per contract has been moving higher. We see that in your January numbers.

[Alex Kramm, Managing Director and Senior Equity Research Analyst at UBS]

I know it's a three-month lag number, and I can probably do the math, but just wondering what's a good RPC to use for the quarter or where we are running in January alone. Any color would be great. Thanks, guys.

[Ben Jackson, President at Intercontinental Exchange]

Hey, Alex, I'll start on the mortgage side and then give some color on the short-term interest rate transition as well. In terms of eClose, we're continuing to see that ramp. We went to—we were at 76 customers last quarter in the last update here. We're now at 93. We're continuing to see that pick up and ramp up. We see as those customers ramp up, that's gonna be yet another area that grows that closing line item on a year-over-year basis as that closing line item is going to be heavily transaction-oriented 'cause a lot of the costs associated to closing fees actually go onto the end closing statement of the customer. That is important to highlight that.

[Ben Jackson, President at Intercontinental Exchange]

As we deliver more and more of these innovations and solutions, we are able to capture more revenue per loan, which is something that's important on that closing line item. On the subscription line item, last year is when we started that pilot program, and we did a small percentage of what renewed. If you take a ballpark of around 10% of the 20% that renewed, that's probably the right zip code of the number that we touched last year. Based on what we learned through that pilot program, we've now codified a program that's gonna hit a much larger percentage of the 20% that are going to renew this year.

[Ben Jackson, President at Intercontinental Exchange]

That gets you into the ballpark of what we have accomplished being a very small percentage, and that we do have a long runway of being able to do this over multiple years ahead of us. From the overall short-term interest rate transition and what we're seeing in that marketplace, that transition went seamless for us in terms of the Short Sterling to SONIA transition. We've seen we did have some trading volume, some arb trading volume that was trading Short Sterling versus SONIA that obviously when Short Sterling went away came off.

[Ben Jackson, President at Intercontinental Exchange]

When you look at the overall STIRS complex and this rising rate environment that we're in both the U.K. as well as the EU, the market overall is off to a great start in terms of both volumes as well as open interest. I'll hand it off to Warren to talk about RPC.

[Warren Gardiner, CFO at Intercontinental Exchange]

Yeah. Alex, just quickly on the rates RPC. Yeah, you're seeing a little bit of lift there, you know, as we kind of transition into SONIA. As you know, that's a much bigger contract than what we had on the short sterling side. There's an equivalent benefit, if you will, from the RPC to kinda account for that. The revenue, if you were to look at it just at a revenue basis, that should be, you know, relatively neutral if you're thinking about it on a notional level. The other impacting factor there, I think at this current level, you're probably at a good place for that interest rate RPC moving forward. Obviously, the impact can be from mix, you know, medium-term versus short-term rates for rates overall.

[Warren Gardiner, CFO at Intercontinental Exchange]

Of course, there's a component of FX that can flow through there as well. But again, all else equal, I think it's kind of a good, you know, what we reported this month is a good run rate to be kind of thinking about for that component of our future business.

[Alex Kramm, Managing Director and Senior Equity Research Analyst at UBS]

Right. Sounds good. I'll follow up on that. Thanks.

[Operator]

I understand there's time for one more follow-up. That is from Kyle Voigt on KBW. Please go ahead.

[Kyle Voigt, Managing Director of Equity Research at KBW]

Hey. Thanks for squeezing in my follow-up. Just on expenses. The midpoint of the expense guide I think is 5% year-on-year growth, comparing to the adjusted OpEx excluding Bakkt. Just wondering if you could talk about how committed you are to delivering operating leverage in 2022 specifically. Again, if we're looking at the business on an adjusted basis excluding Bakkt. Given the business mix change over the past, you know, 5 years or so, just wondering if you can update us on your view of long-term expense growth. Like what's the right expense growth rate long term for ICE? Thanks.

[Warren Gardiner, CFO at Intercontinental Exchange]

Sure. Thanks, Kyle. Good question. You're right. At the midpoint, it's about 5% growth. You know, again, as I said in my remarks, you know, there's a portion of that that we're electing to invest related to the IPO of Bakkt. Some of the operating savings that we had from Bakkt. It's about, you know, if you include revenue, it's about $75 million of savings that we got from Bakkt. We're gonna invest a portion of that this year in some of the tech and ops projects. That's probably about a point of that, if you will, of that 5% at the midpoint that is coming from that. Those are things that, you know, certainly we would have done and we would do over time.

[Warren Gardiner, CFO at Intercontinental Exchange]

Just given the opportunity we had with those savings, we chose to elect to do them now. You know, look, ICE has always been conscious about cost controls and being good on expense controls and things of that nature. We did take that opportunity to do that in order to kinda save that later. I think as you're thinking about it longer term, it's what it's been in the past. We've talked about compensation expense being kind of lower single digit growth in terms of merit annually. That's about half of our expense base. I think that, you know, when you think about non-comp expense, it's probably in a similar range.

[Warren Gardiner, CFO at Intercontinental Exchange]

I think a low single-digit kind of expense growth range on an organic basis is a fair place to be. Again, that's against, you know, revenue. We don't give top-line revenue growth overall for the business, but I think, you know, it's safe to assume that's within the context of revenues growing faster than expenses. You know, I think for, you know, for instance this year, you know, we added $500 million of incremental revenue, which yielded $380 or so of operating income. That's about a 75% incremental margin. I think, yes, we're very much committed to that. You know, transaction business can certainly fluctuate here and there, but over the medium- to long-term, yeah, we would certainly expect that operating leverage to flow through.

[Kyle Voigt, Managing Director of Equity Research at KBW]

Great. Thanks, Warren.

[Operator]

This concludes our question and answer session. I would like to turn the conference back over to Jeff Sprecher for any closing remarks.

[Jeff Sprecher, Chair and CEO at Intercontinental Exchange]

Well, thank you, Alex Blostein, for running the call, and thank you all for joining us this morning. We look forward to soon updating you as we continue to innovate for our customers and give you the results of our all-weather business model as we continue to drive growth. With that, I hope you have a great day.

[Operator]

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Participants

Executives

• Ben Jackson, President
• Jeff Sprecher, Chair and CEO
• Lynn Martin, President of NYSE Group and Chair of Fixed Income and Data Services
• Mary Caroline O'Neal, Head of Investor Relations
• Warren Gardiner, CFO

Analysts

• Alex Blostein, Managing Director of Equity Research at Goldman Sachs
• Alex Kramm, Managing Director and Senior Equity Research Analyst at UBS
• Brian Bedell, Director at Deutsche Bank
• Dan Fannon, Managing Director and Research Analyst at Jefferies
• Kenneth Worthington, Senior Analyst at JPMorgan
• Kyle Voigt, Managing Director of Equity Research at KBW
• Michael Cyprys, Executive Director of Equity Research (Financials) at Financials
• Owen Lau, Senior Analyst at Oppenheimer
• Rich Repetto, Managing Director at Piper Sandler
• Simon Clinch, Research Analyst at Atlantic Equities
• Analyst at Bank of America