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What changed in Nasdaq, Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Nasdaq, Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+472 added−482 removedSource: 10-K (2024-02-21) vs 10-K (2023-02-23)

Top changes in Nasdaq, Inc.'s 2023 10-K

472 paragraphs added · 482 removed · 359 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

147 edited+42 added−49 removed87 unchanged
Biggest changeA Focus on Client Needs Across the Global Financial Ecosystem We strive to serve a diverse range of clients that participate across the global financial ecosystem, including: • Brokers and Traders - Helping brokers and traders to confidently plan, optimize and execute their business vision. • Market Participants - Providing market participants with access to liquidity and enabling them to efficiently consume, monitor, analyze , and capitalize on real-time market changes. • Listed Companies - Enabling companies to access capital markets effectively and manage stakeholders. • Investors and Asset Managers - Offering products and services to assist investors and asset managers in optimizing their portfolios and offerings. • Market Infrastructure Operators - Assisting market infrastructure operators in increasing efficiency, meeting customer needs, and growing revenue. • Banks and Financial Institutions - Providing safety and integrity through a suite of trade surveillance and cloud-native anti-financial crime solutions.
Biggest changeWe strive to be a trusted partner to a diverse range of clients that participate across the global financial ecosystem, including: • Banks and Financial Institutions - Providing safety and integrity through a suite of trade surveillance, cloud-native fraud and anti-money laundering solutions and robust regulatory reporting software. • Market Infrastructure Operators - Assisting market infrastructure operators in increasing efficiency, meeting customer needs, and growing revenue across the trade lifecycle. • Brokers and Traders - Helping brokers and traders to confidently plan, optimize, manage risk and execute their business vision. 7 • Market Participants - Providing market participants with access to liquidity and enabling them to efficiently consume, monitor, analyze , and capitalize on real-time market changes. • Listed Companies - Enabling companies to access capital markets effectively, manage stakeholders and leverage technology to operate and govern effectively. • Investors and Asset Managers - Offering products and services to assist investors and asset managers in optimizing their portfolios and offerings.
For example, there are a number of indexes that aim to track the technology sector and thereby compete with the Nasdaq-100 Index and the Nasdaq Composite Index. We face competition from investment banks, dedicated index providers, markets and other product developers, including S&P Dow Jones Indices, MSCI and FTSE Russell. Workflow & Insights includes our analytics and corporate solutions businesses.
For example, there are a number of indices that aim to track the technology sector and thereby compete with the Nasdaq-100 Index and the Nasdaq Composite Index. We face competition from investment banks, dedicated index providers, markets and other product developers, including S&P Dow Jones Indices, MSCI and FTSE Russell. Workflow & Insights includes our analytics and corporate solutions businesses.
Our Data business sells and distributes historical and real-time market data to sell-side customers, the institutional investing community, retail online brokers, proprietary trading firms, and other venues, as well as internet portals and data distributors. We collect, process, and create information and earn revenues as a distributor of our own, as well as select third-party, content.
Our Data business distributes historical and real-time market data to sell-side customers, the institutional investing community, retail online brokers, proprietary trading firms, and other venues, as well as internet portals and data distributors. We collect, process, and create information and earn revenues as a distributor of our own, as well as select third-party, content.
Our listing qualifications department evaluates applications submitted by issuers seeking to list their securities on The Nasdaq Stock Market to determine whether the quantitative and qualitative listing standards have been satisfied. Once securities are listed, the listing qualifications department monitors each issuer’s on-going compliance with The Nasdaq Stock Market’s continued listing standards. Broker-dealer regulation.
Our listing qualifications department evaluates applications submitted by issuers seeking to list their securities on The Nasdaq Stock Market to determine whether the quantitative and qualitative listing standards have been 11 satisfied. Once securities are listed, the listing qualifications department monitors each issuer’s on-going compliance with The Nasdaq Stock Market’s continued listing standards. Broker-dealer regulation.
We help organizations enhance their ability to understand and expand their global shareholder base, improve corporate governance, and navigate the evolving ESG landscape through our suite of advanced technology, analytics, and consulting services. We also advise clients on a range of governance and sustainability-related issues.
We help organizations enhance their 3 ability to understand and expand their global shareholder base, improve corporate governance, and navigate the evolving ESG landscape through our suite of advanced technology, analytics, and consulting services. We also advise clients on a range of governance and sustainability-related issues.
We also provide various other data, including data relating to our U.S. equities and options exchanges and Nordic equities, derivatives, fixed income, futures and commodities. Additionally, our Nasdaq Cloud Data Service provides a flexible and efficient method of delivery for real-time exchange data and other financial information.
We also provide various other data, including data relating to our U.S. equities and options exchanges and Nordic equities, derivatives, fixed income and futures. Additionally, our Nasdaq Cloud Data Service provides a flexible and efficient method of delivery for real-time exchange data and other financial information.
For example, our primary “Nasdaq” mark is a registered trademark that we actively seek to protect in the U.S. and in over 50 other countries worldwide. 9 Over time, we have accumulated a robust portfolio of issued patents in the U.S. and in many other jurisdictions across the world.
For example, our primary “Nasdaq” mark is a registered trademark that we actively seek to protect in the U.S. and in over 50 other countries worldwide. Over time, we have accumulated a robust portfolio of issued patents in the U.S. and in many other jurisdictions across the world.
Our ESG Solutions, including Nasdaq OneReport, Metrio and ESG Advisory, are positioned in evolving markets with competitors offering multiple point solutions providing software, data or consulting services. The competitive landscape for our Governance Solutions products varies by customer segment and geography.
Our ESG Solutions, including Nasdaq Metrio and ESG Advisory, are positioned in evolving markets with competitors offering multiple point solutions providing software, data or consulting services. The competitive landscape for our Governance Solutions products varies by customer segment and geography.
In addition, we own a minority interest in NPM Securities. Nasdaq Execution Services operates as our routing broker for sending orders from Nasdaq's U.S. cash equity and options exchanges to other venues for execution.
In addition, we own a minority interest in NPM Securities, LLC. Nasdaq Execution Services operates as our routing broker for sending orders from Nasdaq’s U.S. cash equity and options exchanges to other venues for execution.
Similar requirements are set up by EMIR in relation to clearing operations. 14 The SSMA also contains the framework for both the SFSA’s supervisory work in relation to exchanges and clearinghouses and the surveillance to be carried out by the exchanges themselves.
Similar requirements are set up by EMIR in relation to clearing operations. The SSMA also contains the framework for both the SFSA’s supervisory work in relation to exchanges and clearinghouses and the surveillance to be carried out by the exchanges themselves.
In Canada, our cash equities exchange competes with exchanges such as the Toronto Stock Exchange, or TSX, and other marketplaces. Our U.S. Tape plans earn revenue from consolidated data products which are distributed by SEC-mandated consolidators (one for Nasdaq-listed stocks and another for NYSE and other-listed stocks) that share the revenue among the exchanges that contribute data.
In Canada, our cash equities exchange competes principally with exchanges such as the Toronto Stock Exchange, or TSX. Our U.S. Tape plans earn revenue from consolidated data products which are distributed by SEC-mandated consolidators (one for Nasdaq-listed stocks and another for NYSE and other-listed stocks) that share the revenue among the exchanges that contribute data.
In addition to the larger exchanges, companies seeking capital or liquidity from public capital markets are able to raise capital without a regulated market listing and can consider trading their shares on smaller markets and quoting facilities. Our Index business offers Nasdaq-branded indexes and financial products and faces competition from providers of various competing financial indexes.
In addition to the larger exchanges, companies seeking capital or liquidity from public capital markets are able to raise capital without a regulated market listing and can consider trading their shares on smaller markets and quoting facilities. Our Index business offers Nasdaq-branded indices and financial products and faces competition from providers of various competing financial indices.
The Marketplace Services Platform is targeted at new markets and enables end-to-end marketplace implementation without the resources required for on-premise solutions. Numerous market technology projects involve complex delivery management and systems integration. Through our integration services, we can assume responsibility for projects that involve migration to a new system and the establishment of entirely new marketplaces.
The Marketplace Services Platform is targeted at new emerging digital markets and enables end-to-end marketplace implementation without the resources required for on-premise solutions. Numerous market technology projects involve complex delivery management and systems integration. Through our integration services, we can assume responsibility for projects that involve migration to a new system and the establishment of entirely new marketplaces.
Competitors also include companies that serve multiple industries in addition to financial services with generalized solutions, such as business intelligence tools, data integrators, investigation platforms and software covering the boarder compliance lifecycle.
Competitors also include companies that serve multiple industries in addition to financial services with generalized solutions, such as business intelligence tools, data integrators, investigation platforms and software covering the broader compliance lifecycle.
These opportunities, which include anti-financial crime and marketplace technology solutions, workflow for investment managers and asset owners as well as insight solutions, constituted large and growing opportunities where we felt our strengths in technology, analytics and capital markets expertise, combined with our expansive client network, positioned us to meet our clients’ evolving needs.
These opportunities, which include anti-financial crime and compliance solutions, marketplace technology, workflow for investment managers and asset owners as well as insight solutions, constituted large and growing opportunities where we felt our strengths in technology, proprietary data, analytics and capital markets expertise, combined with our expansive client network, positioned us to meet our clients’ evolving needs.
With over 10,000 corporate clients and 5,000 clients across the investment management ecosystem, Nasdaq is a trusted partner to aid the corporate and investment communities in making more informed decisions.
With approximately 10,000 corporate clients and 5,000 clients across the investment management ecosystem, Nasdaq is a trusted partner to aid the corporate and investment communities in making more informed decisions.
Our trade management services business provides market participants with a wide variety of alternatives for connecting to and accessing our markets for a fee. Our marketplaces may be accessed via a number of different protocols used for quoting, order entry, trade reporting and connectivity to various data feeds.
Our trade management services provide market participants with a wide variety of alternatives for connecting to and accessing our markets for a fee. Our marketplaces may be accessed via a number of different protocols used for quoting, order entry, trade reporting and connectivity to various data feeds.
Data is made available through a suite of application programming interfaces, or APIs, allowing for the integration of data from disparate sources and a reduction in time to market for customer-designed applications. The API is highly scalable and can support the delivery of real-time exchange data.
Data is made available through a suite of application programming interfaces, or APIs, allowing for the integration of data from disparate sources and a reduction in time to market for customer-designed applications. These APIs are highly scalable and can support the delivery of real-time exchange data.
The Nasdaq Stock Market serves as the processor for the UTP Plan pursuant to a contract for a two-year term through October 2023. The Nasdaq Stock Market also serves as the administrator for the UTP Plan.
The Nasdaq Stock Market serves as the processor for the UTP Plan pursuant to a contract for a two-year term through October 2025. The Nasdaq Stock Market also serves as the administrator for the UTP Plan.
For smaller companies and growth companies, we offer access to the financial markets through the Nasdaq First North alternative marketplaces. As of December 31, 2022, a total of 1,251 companies listed securities on our Nordic and Baltic exchanges. Our European listing customers include companies, funds and governments.
For smaller companies and growth companies, we offer access to the financial markets through the Nasdaq First North alternative marketplaces. As of December 31, 2023, a total of 1,218 companies listed securities on our Nordic and Baltic exchanges. Our European listing customers include companies, funds and governments.
Our registered broker-dealers are subject to regulatory requirements intended to ensure their general financial soundness and liquidity, which require that they comply with certain minimum capital requirements. As of December 31, 2022, each of our broker-dealers were in compliance with all of the applicable capital requirements. Regulatory contractual relationships with FINRA .
Our registered broker-dealers are subject to regulatory requirements intended to ensure their general financial soundness and liquidity, which require that they comply with certain minimum capital requirements. As of December 31, 2023, each of our broker-dealers were in compliance with applicable capital requirements. Regulatory contractual relationships with FINRA .
In 2022, we conducted a pay equity analysis, which supplements our annual multifaceted compensation review program, successfully concluding that review in the second quarter of the year. Our pay equity analysis for 2023 has already begun as part of the annual compensation review program to be completed in the same cycle next year.
In 2023, we conducted a pay equity analysis, which supplements our annual multifaceted compensation review program, successfully concluding that review in the fourth quarter of the year. Our pay equity analysis for 2024 has already begun as part of the annual compensation review program to be completed in the same cycle next year.
Index data products include our Global Index Data Service, which delivers real-time index values throughout the trading day, and Global Index Watch/Global Index File Delivery Service, which delivers daily as well as historical weightings and components data, corporate actions and a breadth of additional data for the indexes that we operate.
Index data products include our Global Index Data Service, which delivers real-time index values throughout the trading day, and Global Index Watch/Global Index File Delivery Service, which delivers daily and historical weightings and components data, corporate actions and a breadth of additional data for the indices that we operate.
We have invested in professional development for our employees, including offering access to more than 26,000 professional development programs; providing tuition assistance to employees enrolled in degree-granting academic programs; holding internal career fairs and career development programs; connecting employees to our formal mentoring programs and providing one-on-one professional coaching opportunities. We welcomed 156 interns to Nasdaq during 2022.
We have invested in professional development for our employees, including offering access to more than 26,000 professional development programs; providing tuition assistance to employees enrolled in degree-granting academic programs; holding internal career fairs and career development programs; connecting employees to our formal mentoring programs and providing one-on-one professional coaching opportunities. We welcomed approximately 150 interns to Nasdaq during 2023.
Together with companies that transferred additional securities to The Nasdaq Stock Market during 2022, an aggregate of $36 billion in global equity market capitalization switched to The Nasdaq Stock Market. We also offer listings on the exchanges that comprise Nasdaq Nordic and Nasdaq Baltic.
Together with companies that transferred additional securities to The Nasdaq Stock Market during 2023, an aggregate of $377 billion in global equity market capitalization switched to The Nasdaq Stock Market. We also offer listings on the exchanges that comprise Nasdaq Nordic and Nasdaq Baltic.
Workflow & Insights Our Workflow & Insights business includes our analytics and corporate solutions businesses. Our analytics business provides asset managers, investment consultants and institutional asset owners with information and analytics to make data-driven investment decisions, deploy their resources more productively, and provide liquidity solutions for private funds.
Workflow & Insights Workflow & Insights includes our analytics and corporate solutions products. Our analytics products provide asset managers, investment consultants and institutional asset owners with information and analytics to make data-driven investment decisions, deploy their resources more productively, and provide liquidity solutions for private funds.
Gender and Ethnicity Performance Data as of December 31, 2022 and 2021 Gender : 17 * In the charts above, not disclosed percentage includes employees that have chosen not to disclose and race and ethnicities that are less than 0.3%.
Gender and Ethnicity Performance Data as of December 31, 2023 and 2022 Gender : 16 * In the charts above, not disclosed percentage includes employees that have chosen not to disclose and race and ethnicities that are less than 0.3%.
Since its inception in 2017, our venture program has grown in size and has invested in companies covering various sectors, including data, analytics and workflow, digital assets, market infrastructure, anti-financial crime, new marketplaces, enabling technologies and ESG. As of December 31, 2022, our investments, which include equity and debt investments, were valued at $180 million.
Since its inception in 2017, our venture program has grown in size and has invested in companies covering various sectors, including data, analytics and workflow technologies, blockchain and digital assets, market infrastructure, anti-financial crime, new marketplaces, enabling technologies and ESG. As of December 31, 2023, our investments, which include equity and convertible debt investments, were valued at $169 million.
By utilizing the division’s position at the center of markets, we believe that Market Platforms will be at the forefront of the financial system’s evolution and will play a critical role in advancing the modernization of markets across geographies and asset classes. • Transparency : Our Capital Access Platforms division is uniquely placed to help clients navigate the increasing complexity of the evolving financial system through access to capital and transparency which enables economic growth.
By utilizing our Market Services segment’s position at the center of markets, we believe that our Financial Technology segment will be at the forefront of the financial system’s evolution and will play a critical role in advancing the modernization of markets across geographies and asset classes. 1 • Transparency : Our Capital Access Platforms segment is uniquely placed to help clients navigate the increasing complexity of the evolving financial system through access to capital and transparency which enables economic growth.
A Unique Value Proposition We operate leading platforms that can improve the liquidity, transparency, and integrity of the global economy, allowing us to: • Develop efficient and reliable technologies to facilitate and protect the financial system across asset classes; • Empower our clients to effectively navigate the capital markets, achieve their sustainability goals, and maintain corporate governance excellence; and • Provide data, tools and insights that drive sound decision making.
A Unique Value Proposition We operate leading platforms that can improve the liquidity, transparency, and integrity of the global financial ecosystem, allowing us to: • Develop efficient and reliable technologies to facilitate and protect the financial system across asset classes; • Empower our clients to effectively navigate the capital markets, achieve their sustainability goals, and maintain corporate governance excellence; and • Provide data, tools and insights that drive sound decision making while complying with evolving regulatory requirements.
In Europe, our cash equities markets compete with exchanges such as Euronext N.V., Deutsche Börse AG, London Stock Exchange Group plc, or LSE, and many MTFs such as Cboe, Turquoise and Aquis. Our competitors in the trading and clearing of options and futures on European equities include Eurex, Cboe, ICE Futures Europe and London Clearing House, or LCH.
In Europe, our cash equities markets compete with exchanges such as Euronext N.V., Deutsche Börse AG, LSE and many Multilateral Trading Facilities, or MTFs, such as Cboe, Turquoise and Aquis. Our competitors in the trading and clearing of options and futures on European equities include Eurex, Cboe, ICE Futures Europe and London Clearing House, or LCH.
Technological Strength The strength and resiliency of our technology, enhanced by our Marketplace Technology business, in meeting the advancing demands of our global customer base is vital to the continued success of our business and distinguishes us from our competitors.
Technological Strength The strength and resiliency of our technology, enhanced by our new Financial Technology division, in meeting the advancing demands of our global customer base is vital to the continued success of our business and distinguishes us from our competitors.
Our solutions can handle a wide array of assets, including but not limited to cash equities, equity derivatives, currencies, various interest-bearing securities, commodities, energy products and digital currencies. Our solutions can also be used in the creation of new asset classes by non-capital markets customers, including those in insurance liabilities securitization, cryptocurrencies and sports wagering, as discussed further below.
Our solutions can handle a wide array of assets, including but not limited to cash equities, equity derivatives, currencies, various interest-bearing securities, commodities, energy products and digital currencies. Our solutions can also be used in the creation of new asset classes by non-capital markets customers, as discussed further below.
Nasdaq Stockholm’s exchange activities are regulated primarily by the SSMA, which implements MiFID II into Swedish law and which sets up basic requirements regarding the board of the exchange and its share capital, and which also outlines the conditions on which exchange licenses are issued.
Nasdaq Stockholm’s exchange activities are regulated primarily by the SSMA, which implements MiFID II into Swedish law and which sets up basic requirements for the board of directors of the exchange and the exchange’s share capital, and which also outlines the conditions on which exchange licenses are issued.
With respect to ongoing operations, the SSMA requires exchanges to conduct their activities in an honest, fair and professional manner, and in such a way as to maintain public confidence in the securities markets.
The SSMA requires exchanges to conduct their activities in an honest, fair and professional manner, and in such a way as to maintain public confidence in the securities markets.
During our annual executive succession planning exercise with our Board of Directors, we realized a 26% increase, as compared to 2021, in the diversity of our senior executive succession candidates (considering gender, race and LGBTQ+ status) due to a focus by our senior executives on identifying and cultivating talent deeper in their organizations.
During our annual executive succession planning exercise with our Board of Directors, we realized a 3% increase, as compared to 2022, in the diversity of our senior executive succession candidate pool (considering gender, race and LGBTQ+ status) due to a focus by our senior executives on identifying and cultivating talent deeper in their organizations.
In 2022, Nasdaq employees raised over $1 million including donations and matches, supporting almost 650 charities worldwide. Nasdaq’s “Purpose” comprises our philanthropic, community outreach, entrepreneurial support and employee volunteerism programs, all designed to leverage our unique place at the center of capital creation, markets, and technology and drive stronger economies, more equitable opportunities and contribute to a more sustainable world.
In 2023, Nasdaq employees raised over $450,000, including donations and matches, supporting almost 600 charities worldwide. 17 Nasdaq’s “Purpose” comprises our philanthropic, community outreach, entrepreneurial support and employee volunteerism programs, all designed to leverage our unique place at the center of capital creation, markets, and technology and drive stronger economies, more equitable opportunities and contribute to a more sustainable world.
Regulators are continuously monitoring the market structure and have, in a series of consultations, asked for input regarding suggested changes to MiFID II. Our European fixed income and commodities products and services are subject to competitive pressure from European exchanges and clearinghouses. Our Marketplace Technology business includes our trade management services and market technology businesses.
Regulators are continuously monitoring the market structure and have, in a series of consultations, asked for input regarding suggested changes to MiFID II. Our European fixed income and commodities products and services are subject to competitive pressure from European exchanges and clearinghouses.
We also launched a new artificial intelligence-driven career development platform called the Career Hub that matches employees, based on their career aspirations, to internal training, potential mentors, short-term projects and full-time internal roles. This helped us increase our career satisfaction scores in our biannual employee engagement survey and supported employee retention.
Our artificial intelligence-driven career development platform, the Career Hub, matches employees, based on their career aspirations, to internal training, potential mentors, short-term projects and full-time internal roles. This helped us again increase our career satisfaction scores in our biannual employee engagement survey and supported employee retention.
Our successful Nasdaq MRX migration to the cloud, discussed above, created a blueprint for our Marketplace Technology clients that will be used to demonstrate, guide and migrate their markets to the cloud, as well as for our own future market migrations.
Our ongoing migration to the cloud, discussed below, created a blueprint for our Marketplace Technology clients that will be used to demonstrate, guide and migrate their markets to the cloud, as well as for our own future market migrations.
During 2022, we launched a year-long series called the Manager Forum, facilitated by our CEO and other senior and mid-career leaders, to engage managers in sustained leadership development, alongside our existing formal leadership development curriculum.
During 2023, we continued a series called the Manager Forum, facilitated by our CEO and other senior and mid-career leaders, to engage managers in sustained leadership development, alongside our existing formal leadership development curriculum.
Our Value Proposition: We deliver world-leading platforms that improve the liquidity, transparency and integrity of the global economy. Our Strategy: In 2017, we set a new strategic direction focused on maximizing the resources, people and capital allocated to our largest growth opportunities.
Our Vision: We will be the trusted fabric of the world’s financial system. Our Value Proposition: We deliver world-leading platforms that improve the liquidity, transparency and integrity of the global economy. Our Strategy: In 2017, we set a new strategic direction focused on maximizing the resources, people and capital allocated to our largest growth opportunities.
Leveraging the insights and capabilities across our listings, advisory, data, index, and analytics teams, we believe that Capital Access Platforms will serve as a bridge between the investor and corporate communities, focused on enhancing the client experience by providing efficient routes to capital, delivering more holistic, actionable insights and intelligence, modernizing workflows, and navigating the climate and ESG landscape. 1 • Integrity: Our Anti-Financial Crime division combines Nasdaq's fraud detection, anti-money laundering, and surveillance businesses.
Leveraging the insights and capabilities across our listings, advisory, data, index, and analytics teams, we believe that Capital Access Platforms serves as a bridge between the investor and corporate communities, focused on enhancing the client experience by providing efficient routes to capital, delivering more holistic, actionable insights and intelligence, modernizing workflows, and navigating the climate and ESG landscape. • Integrity: Financial Crime Management Technology and Regulatory Technology include Nasdaq’s fraud detection, anti-money laundering, surveillance and risk data management and regulatory reporting solutions businesses.
By aligning our business segments against these secular trends, we aim to deliver more for our clients and increase growth across our key pillars of liquidity, transparency and integrity: • Liquidity: Within our Market Platforms division, we continue to modernize markets by utilizing technology to maximize the liquidity of the global economy.
The divisional structure is as follows: By aligning our business segments against these secular trends, we aim to deliver more for our clients and increase growth across our key pillars of liquidity, transparency and integrity: • Liquidity: Within our Financial Technology and Market Services segments, we continue to modernize markets by utilizing technology to maximize the liquidity of the global economy.
Index Our Index business develops and licenses Nasdaq-branded indexes and financial products. License fees for our trademark licenses vary by product based on a percentage of underlying assets, dollar value of a product issuance, number of products or number of contracts traded. We also license cash-settled options, futures and options on futures on our indexes.
License fees for our trademark licenses vary by product based on a percentage of underlying assets, dollar value of a product issuance, number of products or number of contracts traded. We also license cash-settled options, futures and options on futures on our indices.
Trading Services also includes revenues from U.S. Tape plans. The plan administrators sell quotation and last sale information for all transactions, whether traded on The Nasdaq Stock Market or other exchanges, to market participants and to data distributors, who then provide the information to subscribers.
We also operate a U.S. corporate bond exchange for the listing of corporate bonds. Market Services also includes revenues from U.S. Tape plans. The plan administrators sell quotation and last sale information for all transactions, whether traded on The Nasdaq Stock Market or other exchanges, to market participants and to data distributors, who then provide the information to subscribers.
Our market technology business currently offers its services to several digital assets exchanges, commercial real estate markets, the reinsurance market and sports wagering operators. Our Marketplace Services Platform provides next-generation marketplace capabilities spanning the transaction lifecycle to facilitate the exchange of assets, services and information across various types of market ecosystems and machine-to-machine transactions.
Our market technology business currently offers its services to several digital assets exchanges, and the SaaS-based Marketplace Services Platform provides next-generation marketplace capabilities spanning the transaction lifecycle to facilitate the exchange of assets, services and information across various types of market ecosystems and machine-to-machine transactions.
The division will continue its focus on delivering a world-class platform, leveraging the power of the cloud and machine learning across asset classes, to the full spectrum of banks and brokers, including the emerging ecosystem of financial technology, or FinTech, companies and digital banks.
These businesses will continue delivering world-class solutions, leveraging the power of the cloud and machine learning across asset classes, to the full spectrum of banks and brokers, including the emerging ecosystem of financial technology, or FinTech, companies and digital banks.
We ran targeted attraction campaigns in our major markets using (with permission) local employee stories and photos, and partnered with diverse talent organizations, such as the National Society of Black Engineers, AfroTech, the Society of Women Engineers, Women in Technology, Grace Hopper and the Society of Hispanic Professional Engineers to help improve brand awareness of Nasdaq and attract a higher number of diverse candidates compared to 2021.
We ran targeted attraction campaigns in our major markets using (with permission) local employee stories and photos, and partnered with diverse talent organizations, such as the National Society of Black Engineers, AfroTech, Sistas in Sales, Women in Tech, Information Technology Senior Management Forum and the Society of Hispanic Professional Engineers to help improve brand awareness of Nasdaq and attract a higher number of diverse candidates for potential hiring, as compared to 2022.
Diversity, Equity and Inclusion At Nasdaq, three pillars guide our diversity, equity and inclusion efforts: Workforce, Workplace and Marketplace . Workforce seeks to ensure that our employee population is representative of the communities in which we operate.
A Culture of Inclusion At Nasdaq, three pillars guide our diversity, equity and inclusion efforts: Workforce, Workplace and Marketplace . Workforce seeks to ensure that our employee population is representative of the communities in which we operate. Workplace seeks to create a positive, equitable workplace experience for all employees of Nasdaq.
In this capacity, NDW is subject to oversight and inspections by the SEC. Among other things, registered investment advisors like NDW must comply with certain disclosure obligations, advertising and fee restrictions and requirements relating to client suitability and custody of funds and securities.
In this capacity, NDW is subject to oversight and inspections by the SEC. Among other things, registered investment advisors like NDW must comply with certain disclosure obligations, advertising and fee restrictions and requirements relating to client suitability and custody of funds and securities. Registered investment advisors are also subject to anti-fraud provisions under both federal and state law. CFTC Regulation.
This transformational combination resulted in the expansion of our business from a U.S.-based exchange operator to a global exchange company offering technology that powers our own exchanges and markets as well as many other marketplaces around the world. We operated as the NASDAQ OMX Group until we rebranded our business as Nasdaq, Inc. in 2015.
In February 2008, Nasdaq and OMX AB combined their businesses, and we changed our corporate name to The NASDAQ OMX Group, Inc. This transformational combination resulted in the expansion of our business from a U.S.-based exchange operator to a global exchange company offering technology that powers our own exchanges and markets as well as many other marketplaces around the world.
For market infrastructure operators, which include exchanges, regulators, clearinghouses and central securities depositories, we provide and deliver mission-critical solutions across the trade lifecycle via NFF, which is designed to cover all aspects of a market operator’s needs, from trading and clearing to risk management, market surveillance, index development, data, management, testing and quality assurance. 3 Recently, we have seen a growing demand for our products and services outside of the traditional capital markets.
For market infrastructure operators, which include exchanges, regulators, clearinghouses and central securities depositories, we provide and deliver mission-critical solutions across the trade lifecycle, which is designed to cover all aspects of a market operator’s needs, from trading and clearing to risk management, market surveillance, index development, data, management, testing and quality assurance.
We operate several other proprietary services and data products to provide market information, including Nasdaq Basic, a low cost alternative to the industry Level 1 feed and Nasdaq Canada Basic, a low cost alternative to other high priced data feeds.
We also offer Nordic Equity TotalView, Nordic Derivatives TotalView and Nordic Fixed Income TotalView for Nordic markets. We operate several other proprietary services and data products to provide market information, including Nasdaq Basic, a low cost alternative to the industry Level 1 feed and Nasdaq Canada Basic, a low cost alternative to other high priced data feeds.
Anti-Financial Crime For our Anti-Financial Crime segment, which includes solutions for fraud detection, anti-money laundering or AML and trade and market surveillance, competitors include core banking solution providers ranging from small to large independent solution providers, FinTech start-ups and in-house custom builds. We compete against enterprise solution providers and point solutions for clients with larger AUM.
Financial Technology For our Financial Crime Management Technology and trade and market surveillance businesses, competitors include core banking solution providers ranging from small to large, independent solution providers, FinTech start-ups and in-house custom builds. We compete against enterprise solution providers and point solutions for clients with larger AUM.
Our market technology business has evolved from its origins serving the capital markets, as we have leveraged NFF, our flexible and modular architecture technology that provides next generation capital markets capabilities in an open and agile environment, to develop our SaaS platform and offerings.
We continue to build out our SaaS business portfolio by extending and migrating our current offerings to SaaS. Our market technology business has evolved from its origins serving the capital markets, as we leverage our flexible and modular architecture technology that provides next generation capital markets capabilities in an open and agile environment, to develop our SaaS platform and offerings.
There are competing ways of raising capital, and we seek to demonstrate the benefits of listing shares on our exchange. Our primary competitor for larger company stock share listings in the U.S. is NYSE.
Our Listing Services business in both the U.S. and Europe provides a means of facilitating capital formation through public capital markets. There are competing ways of raising capital, and we seek to demonstrate the benefits of listing shares on our exchange. Our primary competitor for larger company stock share listings in the U.S. is NYSE.
The Nominating & ESG Committee has formal responsibility and oversight for ESG policies and programs and receives regular reporting on key ESG matters and initiatives. Our Corporate ESG Steering Committee serves as the central coordinating body for our ESG strategy; it is co-chaired by executive leaders and comprised of geographically diverse representatives from multiple business units.
The Nominating & ESG Committee has formal responsibility and oversight for corporate ESG policies and programs and receives regular reporting on key ESG matters and initiatives. Our Corporate ESG Steering Committee serves as the central coordinating body for our ESG strategy; it is co-chaired by executive leaders and comprised of a cross-functional group of Nasdaq senior executives.
Our public company clients can be companies listed on our exchanges or other U.S. and global exchanges. Our private company clients include a diverse group of organizations ranging from family-owned companies, government organizations, law firms, privately held entities, and various non-profit organizations to hospitals and healthcare systems.
Our private company clients include a diverse group of organizations ranging from family-owned companies, government organizations, law firms, privately held entities, and various non-profit organizations to hospitals and healthcare systems.
We also added customized developmental programs for underrepresented talent, including executive mentoring and accelerated leadership development programs. In 2022, we launched a high-potential leadership program for our female employees to enhance their skills and increase advancement opportunities.
We also added customized developmental programs for underrepresented talent, including executive mentoring and accelerated leadership development programs. In 2023, we graduated our first class of Acclerate(her), which is our high-potential leadership program for our female employees to enhance their skills and increase advancement opportunities.
Capital Access Platforms Our Capital Access Platforms segment delivers liquidity, transparency and integrity to the corporate issuer and investment community by empowering our clients to effectively navigate the capital markets, achieve their sustainability goals, and drive governance excellence.
Products and Services Capital Access Platforms Our Capital Access Platforms segment delivers liquidity, transparency and integrity to the corporate issuer and investment community by empowering our clients to effectively navigate the capital markets, achieve their sustainability goals, and drive governance excellence. We offer a suite of products to assist companies in managing corporate governance standards.
The Supplier Code of Ethics, which is available on our website, encourages our suppliers and vendors to adopt sustainability and environmental practices in line with our published Environmental Practices Statement, to promote a diverse and inclusive workforce and to engage diverse-owned business in their supply chain.
The Supplier Code of Ethics, which is available on our website, encourages our suppliers and vendors to adopt sustainability and environmental practices in line with our published Environmental Practices Statement and to promote a diverse and inclusive workforce. Additionally, our new suppliers are required to attest to the Supplier Code of Ethics in connection with the commencement of their engagement.
In Finland, Sweden and Estonia, decisions to list new companies on the main market are made by listing committees that have external members in addition to members from each respective exchange and in the other countries the decision is made either by the respective president of the exchange or by the executive board.
In Finland, Sweden and Estonia, decisions to list new companies on the main market are made by listing committees that have external members in addition to members from each respective exchange and in the other countries the decision is made either by the respective president of the exchange or by the executive board. 14 If there is suspicion that a listed company or member has acted in breach of exchange regulations, the matter is handled by the respective surveillance department.
To support our business objectives and benefit from our investments in research and development, we actively create and maintain a wide array of intellectual property assets, including patents and patent applications related to our innovations, products and services; trademarks related to our brands, products and services; copyrights in software and creative content; trade secrets; and through other intellectual property rights, licenses of various kinds and contractual provisions.
Intellectual Property We believe that our intellectual property assets are important for maintaining the competitive differentiation of our products, systems, software and services, enhancing our ability to access technology of third parties and maximizing our return on research and development investments. 9 To support our business objectives and benefit from our investments in research and development, we actively create and maintain a wide array of intellectual property assets, including patents and patent applications related to our innovations, products and services; trademarks related to our brands, products and services; copyrights in software and creative content; trade secrets; and through other intellectual property rights, licenses of various kinds and contractual provisions.
Such services and solutions primarily consisted of flexible back-office systems, which allowed customers to efficiently manage safekeeping, settlement and corporate actions and reporting, and included connectivity to exchanges and central securities depositories.
This business primarily offered technology and customized securities administration solutions to financial participants in the Nordic market. Such services and solutions primarily consisted of flexible back-office systems, which allowed customers to efficiently manage safekeeping, settlement and corporate actions and reporting, and included connectivity to exchanges and central securities depositories.
In the U.S., we operate six options exchanges: Nasdaq PHLX, The Nasdaq Options Market, Nasdaq BX Options, Nasdaq ISE, Nasdaq GEMX and Nasdaq MRX. These exchanges facilitate the trading of equity, ETF, index and foreign currency options. Our combined options market share in 2022 represented the largest share of the U.S. market for multi-listed equity options.
These exchanges facilitate the trading of equity, ETF, index and foreign currency options. Our combined options market share in 2023 represented the largest share of the U.S. market for multi-listed equity options.
The shift to cloud-based markets will enable Nasdaq to provide its clients access to cloud-based capabilities, including virtual connectivity services, market analytics and machine learning, at a lower cost.
We expect to move additional North American markets to the cloud with AWS during the next several years. The shift to cloud-based markets will enable Nasdaq to provide its clients access to cloud-based capabilities, including virtual connectivity services, market analytics and machine learning, at a lower cost.
Fusion positions Nasdaq’s North American and European markets to manage, operate and deploy a common platform that can be used across our nine Nasdaq derivative markets, while enabling our markets for cloud deployment .
Fusion positions Nasdaq’s North American and European markets to manage, operate and deploy a common platform that can be used across our nine Nasdaq derivative markets, while enabling our markets for cloud deployment . Competitive Strengths We are a global, client-focused technology company with expertise in markets and financial technology.
Compensation and Benefits Our Total Rewards compensation program is designed to attract, retain, and empower employees to successfully execute our growth strategy. Our comprehensive Total Rewards program reflects our commitment to protecting our employees’ health, well-being and financial security. Our talented employees are our greatest asset, and we offer competitive compensation to attract and retain the best employees.
Compensation and Benefits Our Total Rewards program is designed to attract, retain, and empower employees to successfully execute our growth strategy and our mission to better serve our clients. Our comprehensive Total Rewards program reflects our commitment to protecting our employees’ health, well-being and financial security.
Competition Market Platforms We face intense competition in North America and Europe for our Trading Services businesses. We seek to provide market participants with greater functionality, trading system stability and performance, high levels of customer service, and efficient pricing.
Our trade management services business competes with other exchange operators, extranet providers, and data center providers. Market Services We face intense competition in North America and Europe. We seek to provide market participants with greater functionality, trading system stability and performance, high levels of customer service, and efficient pricing.
As the administrator, The Nasdaq Stock Market manages the distribution of market data, the collection of the resulting market data revenue, and the dissemination of that revenue to plan members in accordance with the terms of the UTP Plan and of Regulation NMS.
As the administrator, The Nasdaq Stock Market manages the distribution of market data, the collection of the resulting market data revenue, and the dissemination of that revenue to plan members in accordance with the terms of the UTP Plan and of Regulation NMS. 12 In September 2023, the SEC adopted an order to require changes to the governance of securities information processors.
Registered investment advisors are also subject to anti-fraud provisions under both federal and state law. 13 CFTC Regulation. The Dodd-Frank Wall Street Reform and Consumer Protection Act resulted in increased CFTC regulation of our use of certain regulated derivatives products, as well as the operations of some of our subsidiaries outside the U.S. and their customers.
The Dodd-Frank Wall Street Reform and Consumer Protection Act resulted in increased CFTC regulation of our use of certain regulated derivatives products, as well as the operations of some of our subsidiaries outside the U.S. and their customers.
This program is focused on identifying areas for improvement in systems, and implementing changes and upgrades to technology and processes to minimize future risk. We have continued our focus on improving the security of our technology with an emphasis on employee awareness through training, targeted phishing education campaigns, and new tool deployment for our securities operations team. See “Item 1A.
We have continued our focus on improving the security of our technology with an emphasis on employee awareness through training, targeted phishing education campaigns, and new tool deployment for our securities operations team. See “Item 1A.
The 2022 new listings were comprised of the following: IPOs 161 Switches from the New York Stock Exchange LLC, or NYSE, and the NYSE American LLC, or NYSE American 14 Upgrades from OTC 46 ETPs and Other Listings 145 Total 366 The Nasdaq Stock Market IPO win rates: 2022 total 89 % Operating companies 92 % SPACs 86 % During 2022, we had 14 new listings resulting from companies switching their listings from NYSE or NYSE American to join The Nasdaq Stock Market.
The 2023 new listings were comprised of the following: Operating company IPOs 103 SPAC IPOs 27 Switches from the New York Stock Exchange LLC, or NYSE, and the NYSE American LLC, or NYSE American 18 Upgrades from OTC 18 ETPs and Other Listings 164 Total 330 The Nasdaq Stock Market IPO win rates: 2023 total 82 % Operating companies 81 % During 2023, we had 18 new listings resulting from companies switching their listings from NYSE or NYSE American to join The Nasdaq Stock Market.
Court of Appeals for the Fifth Circuit. For more information regarding our ESG efforts in 2022, both internally and externally, please see the section entitled “Human Capital Management” below and our Proxy Statement. Regulation We are subject to extensive regulation in the U.S., Canada and Europe. U.S.
For more information regarding our ESG efforts in 2023, both internally and externally, please see the section entitled “Human Capital Management” below and our Proxy Statement. Regulation We are subject to extensive regulation in the U.S., Canada and Europe. U.S. Regulation U.S. federal securities laws establish a system of cooperative regulation of securities markets, market participants and listed companies.
Additionally, we face competition from private equity firms that may elect to keep their portfolio companies as private companies. 8 The Listings Services business in Europe is characterized by a large number of exchanges competing for new or secondary listings. Each country has one or more national exchanges, which are often the first choice of companies in each respective country.
The Listings Services business in Europe is characterized by a large number of exchanges competing for new or secondary listings. Each country has one or more national exchanges, which are often the first choice of companies in each respective country.
Since 2005, there has been cooperation between the supervisory authorities in Sweden, Iceland, Denmark and Finland, which looks to safeguard effective and comprehensive supervision of the exchanges comprising Nasdaq Nordic and the systems operated by it, and to ensure a common supervisory approach. In 2019, the supervisory authority in Norway joined this cooperation.
The supervisory authorities in Sweden, Iceland, Denmark, Finland and Norway all cooperate to safeguard effective and comprehensive supervision of the exchanges comprising Nasdaq Nordic and the systems operated by it, and to ensure a common supervisory approach.
We were named to the Dow Jones Sustainability North America Index for the seventh consecutive year and received recognition from the Bloomberg Gender-Equity Index and The Human Rights Campaign’s Corporate Equality Index.
In 2023, we were named to the Dow Jones Sustainability North America Index for the eighth consecutive year. We were included on Just Capital’s Just100 list of America’s most just companies and received recognition from the Bloomberg Gender-Equity Index and The Human Rights Campaign’s Corporate Equality Index.
Data & Listing Services Our U.S. and European data products enhance transparency of market activity within our exchanges and provide critical information to professional and non-professional investors globally.
Our Capital Access Platforms segment includes Data & Listing Services, Index and Workflow & Insights. Data & Listing Services Our North American and European data products enhance transparency of market activity within our exchanges and provide critical information to professional and non-professional investors globally.
Through our eVestment and Solovis solutions, we provide a suite of cloud-based solutions that help institutional investors and consultants conduct pre-investment due diligence, and monitor their portfolios post-investment.
Through our eVestment and Solovis solutions, we provide a suite of cloud-based solutions that help institutional investors and consultants conduct pre-investment due diligence, and monitor their portfolios post-investment. The eVestment platform also enables asset managers to efficiently distribute information about their firms and funds to asset owners and consultants worldwide.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeThe success of our acquisitions depends, in part, on our ability to integrate these businesses into our existing operations and realize anticipated cost savings, revenue synergies and growth opportunities; and • we may incur restructuring costs in connection with the reorganization of any of our businesses. 25 RISKS RELATED TO LEGAL AND REGULATORY MATTERS We operate in a highly regulated industry and may be subject to censures, fines and enforcement proceedings if we fail to comply with regulatory obligations that can be ambiguous and can change unexpectedly.
Biggest changeRISKS RELATED TO LEGAL AND REGULATORY MATTERS We operate in a highly regulated industry and may be subject to censures, fines and enforcement proceedings if we fail to comply with regulatory obligations that can be ambiguous and can change unexpectedly. We operate in a highly regulated industry and are subject to extensive regulation in the U.S., Europe and Canada.
Any failure to comply with these broker-dealer regulations could have a material adverse effect on the operation of our business, financial condition and operating results. 26 Our non-U.S. business is subject to regulatory oversight in all the countries in which we operate regulated businesses, such as exchanges, clearinghouses or central securities depositories.
Any failure to comply with these broker-dealer regulations could have a material adverse effect on the operation of our business, financial condition and operating results. Our non-U.S. business is subject to regulatory oversight in all the countries in which we operate regulated businesses, such as exchanges, clearinghouses or central securities depositories.
These rating agencies regularly evaluate us, and their ratings of our long-term debt and commercial paper are based on a number of factors, including our financial strength and corporate development activity, as well as factors not entirely within our control, including conditions affecting our industry generally. There can be no assurance that we will maintain our current ratings.
These rating agencies regularly evaluate us, and their ratings of our long-term debt and commercial paper are based on a number of factors, including our financial strength and corporate development activity, as well as factors not entirely within our control, including 24 conditions affecting our industry generally. There can be no assurance that we will maintain our current ratings.
Unsuccessful, lengthy, or costly customer implementation projects could result in claims from customers, decreased customer satisfaction, harm to our reputation, and opportunities for competitors to displace us, each of which could have an adverse effect on our reputation, business and results of operations. Our reputation or business could be negatively impacted by ESG matters and our reporting of such matters.
Unsuccessful, lengthy, or costly customer implementation projects could result in claims from customers, decreased customer satisfaction, harm to our reputation, and opportunities for competitors to displace us, each of which could have an adverse effect on our reputation, business and results of operations. 29 Our reputation or business could be negatively impacted by ESG matters and our reporting of such matters.
Compliance with laws and regulations concerning cybersecurity, data privacy and data usage could result in significant expense, and any failure to comply could result in proceedings against us by regulatory authorities or other third parties. Additional costs for bolstering cybersecurity capabilities, and increased cybersecurity and data privacy compliance costs, could adversely impact our business, financial condition and operating results.
Compliance with laws and regulations concerning cybersecurity, data privacy and data usage could result in significant expense, and any failure to comply could result in proceedings against us by regulatory authorities or other third parties. Costs for bolstering cybersecurity capabilities, and increased cybersecurity and data privacy compliance costs, could adversely impact our business, financial condition and operating results.
There is no assurance that our policies and procedures will always be effective or that we will always be successful in monitoring or evaluating the risks to which we are or may be exposed. Our regulated markets are subject to audits, investigations, administrative proceedings and enforcement actions relating to compliance with applicable rules and regulations.
There is no assurance that our policies and procedures will always be effective or that we will always be successful in monitoring or evaluating the risks to which we are or may be exposed. 25 Our regulated markets are subject to audits, investigations, administrative proceedings and enforcement actions relating to compliance with applicable rules and regulations.
Climate change may have a long-term adverse impact on our business, and climate change disclosure requirements may reduce demand for listings on our exchanges. While we seek to mitigate our business risks associated with climate change by establishing robust environmental and sustainability programs, there are inherent climate related risks wherever our business is conducted.
Climate change may have a long-term adverse impact on our business, and climate and ESG-related disclosure requirements may reduce demand for listings on our exchanges. While we seek to mitigate our business risks associated with climate change by establishing robust environmental and sustainability programs, there are inherent climate related risks wherever our business is conducted.
Our actual or perceived failure to achieve our ESG-related initiatives, goals, or commitments could negatively impact our reputation or otherwise materially harm our business. 30 Failure to protect our intellectual property rights, or allegations that we have infringed on the intellectual property rights of others, could harm our brand-building efforts and ability to compete effectively.
Our actual or perceived failure to achieve our ESG-related initiatives, goals, or commitments could negatively impact our reputation or otherwise materially harm our business. Failure to protect our intellectual property rights, or allegations that we have infringed on the intellectual property rights of others, could harm our brand-building efforts and ability to compete effectively.
Professional subscriptions to our data products are at risk if staff reductions occur in financial services companies or if our customers consolidate, which could result in significant reductions in our professional user revenue or expose us to increased risks relating to dependence on a smaller number of customers.
Professional subscriptions to our data products are at risk if staff reductions occur in financial services companies or if our customers consolidate, which could result in significant reductions in our professional user revenue or expose us to increased risks relating to dependence on a smaller number of 18 customers.
We do not know whether we will be able to accurately project the rate, timing or cost of any volume increases, or expand and upgrade our systems and infrastructure to accommodate any increases in a timely manner. 20 While we have programs in place to identify and minimize our exposure to vulnerabilities and work in collaboration with the technology industry to share corrective measures with our business partners, we cannot guarantee that such events will not occur in the future.
We do not know whether we will be able to accurately project the rate, timing or cost of any volume increases, or expand and upgrade our systems and infrastructure to accommodate any increases in a timely manner. 19 While we have programs in place to identify and minimize our exposure to vulnerabilities and work in collaboration with the technology industry to share corrective measures with our business partners, we cannot guarantee that such events will not occur in the future.
In addition, our U.S. and European businesses are heavily concentrated in particular areas and may be adversely affected by events in those areas. We may incur losses as a result of unforeseen or catastrophic events, such as terrorist attacks, natural disasters, pandemics (such as COVID-19), extreme weather, fire, power loss, telecommunications failures, human error, theft, sabotage and vandalism.
In addition, our U.S. and European businesses are heavily concentrated in particular areas and may be adversely affected by events in those areas. We may incur losses as a result of unforeseen or catastrophic events, such as terrorist attacks, natural disasters, pandemics, extreme weather, fire, power loss, telecommunications failures, human error, theft, sabotage and vandalism.
In our technology operations, we have invested substantial amounts in the development of system platforms, the rollout of our platforms and the adoption of new technologies, including cloud-based infrastructure for certain of our offerings. Although investments are carefully planned, there can be no assurance that the demand for such platforms or technologies will justify the related investments.
In our technology operations, we have invested substantial amounts in the development of system platforms, the rollout of our platforms and the adoption of new technologies, including cloud-based infrastructure and artificial intelligence for certain of our offerings. Although investments are carefully planned, there can be no assurance that the demand for such platforms or technologies will justify the related investments.
There is a risk that trading will shift to exchanges that charge lower fees because, among other reasons, they spend significantly less on regulation. In 2016, the SEC approved a plan for Nasdaq and other exchanges to establish a CAT, to improve regulators’ ability to monitor trading activity.
There is a risk that trading will shift to exchanges or non-exchanges that charge lower fees because, among other reasons, they spend significantly less on regulation. In 2016, the SEC approved a plan for Nasdaq and other exchanges to establish a CAT to improve regulators’ ability to monitor trading activity.
Our markets and the markets that rely on our technology have experienced systems failures and delays in the past and could experience future systems failures and delays.
Our markets and the markets that rely on our technology have experienced systems failures and delays in the past and we could experience future systems failures and delays.
In addition, our Market Platforms businesses receive revenues from a relatively small number of customers concentrated in the financial industry, so any event that impacts one or more customers or the financial industry in general could impact our revenues.
In addition, our Market Services businesses receive revenues from a relatively small number of customers concentrated in the financial industry, so any event that impacts one or more customers or the financial industry in general could impact our revenues.
Our industry is risky and unpredictable and is directly affected by many national and international factors beyond our control, including: • economic, political and geopolitical market conditions; • natural disasters, terrorism, pandemics, war or other catastrophes; • broad trends in finance and technology; • changes in price levels and volatility in the stock markets; • the level and volatility of interest rates; • volatility in commodity markets, including the energy markets; • inflation; • changes in government monetary or tax policy; • the imposition of governmental economic sanctions on countries in which we do business or where we plan to expand our business; and • the perceived attractiveness of the U.S. or European capital markets.
Our industry is risky and unpredictable and is directly affected by many national and international factors beyond our control, including: • economic, political and geopolitical market conditions; • natural disasters, terrorism, pandemics, war or other catastrophes; • broad trends in finance and technology; • changes in price levels and volatility in the stock markets; • the level and volatility of interest rates; • volatility in commodity markets, including the energy markets; • inflation; • disruptions or delays in our supply chains; 30 • changes in government monetary or tax policy; • the imposition of governmental economic sanctions on countries in which we do business or where we plan to expand our business; and • the perceived attractiveness of the U.S. or European capital markets.
As cybersecurity threats continue to increase in frequency and sophistication, and as the domestic and international regulatory and compliance structure related to information and cybersecurity; data privacy and data usage; and our digital assets offering, becomes increasingly complex and exacting, we may be required to devote significant additional resources to strengthen our cybersecurity capabilities, and to identify and remediate any security vulnerabilities.
As cybersecurity threats continue to increase in frequency and sophistication, and as the domestic and international regulatory and compliance structure related to information, cybersecurity, data privacy and data usage becomes increasingly complex and exacting, we may be required to devote significant additional resources to strengthen our cybersecurity capabilities, and to identify and remediate any security vulnerabilities.
We utilize widely-accepted methods to identify, assess, monitor and manage our risks, including oversight of risk management by Nasdaq’s Global Risk Management Committee, which is comprised of senior executives and has the responsibility for regularly reviewing risks and referring significant risks to the board of directors or specific board committees.
We utilize widely-accepted methods to identify, assess, monitor and manage our risks, including oversight of risk management by Nasdaq’s Global Risk Management Committee, which comprises senior executives and has the responsibility for regularly reviewing risks and referring significant risks to the board of directors or specific board committees.
Such regulations may impact the requirements and cost of delivery for impacted systems and services and, in the event of an incident, increase the cost and complexity of our response and the potential financial and reputation impact from fines or private litigation. New regulations may also impact customer decision making and conditions on contracting for our services.
New cybersecurity regulations may impact the requirements and cost of delivery for impacted systems and services and, in the event of an incident, increase the cost and complexity of our response and the potential financial and reputation impact from fines or private litigation. These regulations may also impact customer decision making and conditions on contracting for our services.
Additionally, if the SEC or other federal regulatory agencies impose comprehensive reporting obligations regarding climate change on public companies, there may be a decrease in new listings or an increase in delistings of our listed companies, which may adversely affect our business, financial condition and operating results.
Additionally, if the SEC or other federal, state or international regulatory agencies impose comprehensive reporting obligations regarding climate change on U.S. public companies, there may be a decrease in new listings or an increase in delistings of our listed companies, which may adversely affect our business, financial condition and operating results.
Some locations, such as Lithuania, India and the Philippines, have economies that may be subject to greater political, economic and social uncertainties than countries with more developed institutional structures, which may increase our operational risk. Unforeseen or catastrophic events could interrupt our critical business functions.
Some locations, such as Lithuania, India, the Philippines and in other emerging markets, have economies that may be subject to greater political, economic and social uncertainties than countries with more developed institutional structures, which may increase our operational risk. Unforeseen or catastrophic events could interrupt our critical business functions.
The difficulties, costs and delays that could be encountered may include: • difficulties, costs or complications in combining the companies’ operations, including technology platforms, which could lead to us not achieving the synergies we anticipate or customers not renewing their contracts with us as we migrate platforms; • incompatibility of systems and operating methods; • reliance on, or provision of, transition services; • inability to use capital assets efficiently to develop the business of the combined company; • difficulties of complying with government-imposed regulations in the U.S. and abroad, which may be conflicting; • resolving possible inconsistencies in standards, controls, procedures and policies, business cultures and compensation structures; • the diversion of management’s attention from ongoing business concerns and other strategic opportunities; • difficulties in operating businesses we have not operated before; • difficulties of integrating multiple acquired businesses simultaneously; • the retention of key employees and management; 23 • the implementation of disclosure controls, internal controls and financial reporting systems at non-U.S. subsidiaries to enable us to comply with U.S.
The difficulties, costs and delays that could be encountered may include: • difficulties, costs or complications in combining the companies’ operations, including technology platforms, and security measures and infrastructure that may need greater remediation than anticipated, which could lead to us not achieving the synergies we anticipate or customers not renewing their contracts with us as we migrate platforms; 22 • incompatibility of systems and operating methods; • reliance on, or provision of, transition services; • inability to use capital assets efficiently to develop the business of the combined company; • difficulties of complying with government-imposed regulations in the U.S. and abroad, which may be conflicting; • resolving possible inconsistencies in standards, controls, procedures and policies, business cultures and compensation structures; • the diversion of management’s attention from ongoing business concerns and other strategic opportunities; • difficulties in operating businesses we have not operated before; • difficulties of integrating multiple acquired businesses simultaneously; • the retention of key employees and management; • the implementation of disclosure controls, internal controls and financial reporting systems at non-U.S. subsidiaries to enable us to comply with U.S.
To the extent that any of our vendors or other third-party service providers experiences difficulties or a significant disruption, breach or outage, materially changes their business relationship with us or is unable for any reason to perform their obligations, our business or our reputation may be materially adversely affected.
To the extent that any of our vendors or other third-party service providers experiences difficulties or a significant disruption, breach or outage, materially changes their business relationship with us or is unable for any reason to perform their obligations, including due to geopolitical instability, our business or our reputation may be materially adversely affected.
There were no impairment charges recorded relating to goodwill and indefinite-lived intangible assets and there were no material impairment charges recorded relating to other long-lived assets in 2022, 2021 and 2020. 24 We may experience future events that may result in asset impairments.
There were no impairment charges recorded relating to goodwill and indefinite-lived intangible assets and there were no material impairment charges recorded relating to other long-lived assets in 2023, 2022 and 2021. We may experience future events that may result in asset impairments.
Our business performance is impacted by a number of factors, including general economic conditions, current or expected inflation, interest rate fluctuations, market volatility, changes in investment patterns and priorities, pandemics (such as COVID-19) and other factors that are generally beyond our control.
Our business performance is impacted by a number of factors, including general economic conditions, current or expected inflation, interest rate fluctuations, market volatility, changes in investment patterns and priorities, pandemics and other factors that are generally beyond our control.
While we and other market participants have the opportunity to submit comments on the proposal, and we will adjust our business model in accordance with any new SEC regulations implemented, these changes regarding trading may negatively impact our business and revenue. With respect to our regulated businesses, our business model can be severely impacted by policy decisions.
While we and other market participants have the opportunity to submit comments on these proposals, and we will adjust our business model in accordance with any new SEC regulations implemented, the adoption of these proposals regarding trading may negatively impact our business and revenue. With respect to our regulated businesses, our business model can be severely impacted by policy decisions.
Adverse conditions may jeopardize the ability of our listed companies to comply with the continued listing requirements of our exchanges, or reduce the number of issuers launching IPOs, including SPACs, and direct listings. The number of IPOs on our exchanges decreased in 2022 and the number of delistings increased compared to 2021.
Adverse conditions may jeopardize the ability of our listed companies to comply with the continued listing requirements of our exchanges, or reduce the number of issuers launching IPOs, including SPACs, and direct listings. The number of IPOs on our exchanges decreased in both 2023 and 2022, and the number of delistings increased in 2023.
Use of our products and services as part of the investment process creates the risk that clients, or the parties whose assets are managed by our clients, may pursue claims against us in the event of such delay or error. Even with a favorable outcome, significant litigation against us might unduly burden management, personnel, financial and other resources.
Use of our products and services as part of the investment process creates the risk that clients, or the parties whose assets are managed by our clients, may pursue claims against us in the event of such delay or error, and significant litigation against us might unduly burden management, personnel, financial and other resources.
Our systems and operations are vulnerable to damage or interruption from security breaches. As a result of our adoption of a hybrid work environment, we have a broader and more distributed network footprint and increased reliance on the home networks of employees, and such remote work may cause heightened cybersecurity and operational risks.
Our systems and operations are vulnerable to damage or disruption from security breaches. Due to our adoption of a hybrid work environment, we have a broader and more distributed network footprint and increased reliance on the home networks of employees, and such remote work may cause heightened cybersecurity and operational risks.
Various issues may give rise to reputational risk, including issues relating to: • our ability to maintain the security of our data and systems; • the quality and reliability of our technology platforms and systems; • the ability to fulfill our regulatory obligations; • the ability to execute our business plan, key initiatives or new business ventures and the ability to keep up with changing customer demand; • the representation of our business in the media; • the accuracy of our financial statements, other financial and statistical information or ESG-related disclosures; • the accuracy of our financial guidance or other information provided to our investors; • the quality of our corporate governance structure; • the quality of our products, including the reliability of our transaction-based, Corporate Services and marketplace technology products, the accuracy of the quote and trade information provided by our Data & Listing Services business and the accuracy of calculations used by our Indexes business for indexes and unit investment trusts; • the quality of our disclosure controls or internal controls over financial reporting, including any failures in supervision; • extreme price volatility on our markets; • any negative publicity surrounding our listed companies or our listing rules; • any negative publicity surrounding the use of our products and/or services by our customers, including in connection with emerging asset classes such as crypto assets; and • any misconduct, fraudulent activity or theft by our employees or other persons formerly or currently associated with us.
Various issues may give rise to reputational risk, including issues relating to: • our ability to maintain the security of our data and systems; • the quality and reliability of our technology platforms and systems; • the ability to fulfill our regulatory obligations; • the ability to execute our business plan, key initiatives or new business ventures and the ability to keep up with changing customer demand; • the representation of our business in the media; • the accuracy of our financial statements, other financial and statistical information or ESG-related disclosures; • the accuracy of our financial guidance or other information provided to our investors; • the quality of our corporate governance structure; • the quality of our products the reliability of our solutions and the accuracy of our information and data offerings; • the quality of our disclosure controls or internal controls over financial reporting, including any failures in supervision; • extreme price volatility on our markets; • any negative publicity surrounding our listed companies or our listing rules; • any negative publicity surrounding the use of our products and/or services by our customers, including in connection with emerging asset classes such as crypto assets; and • any misconduct, fraudulent activity or theft by our employees or other persons formerly or currently associated with us.
Foreign acquisitions involve risks in addition to those mentioned above, including those related to integration of operations across different cultures and languages, our ability to enforce contracts in various jurisdictions, currency risks and the particular economic, political and regulatory risks associated with specific countries.
Foreign acquisitions, or acquisitions involving companies with numerous foreign subsidiaries, involve risks in addition to those mentioned above, including those related to integration of operations across different cultures and languages, our ability to enforce contracts in various jurisdictions, currency risks and the particular economic, political and regulatory risks associated with specific countries.
Our leverage limits our financial flexibility, increases our exposure to weakening economic conditions and may adversely affect our ability to obtain additional financing. Our indebtedness as of December 31, 2022 was $5.4 billion.
Our leverage limits our financial flexibility, increases our exposure to weakening economic conditions and may adversely affect our ability to obtain additional financing. Our indebtedness as of December 31, 2023 was $10.5 billion.
Acquisitions, divestments, investments, joint ventures and other transactional activities may require significant resources and/or result in significant unanticipated losses, costs or liabilities. Over the past several years, acquisitions have been significant factors in our growth. We have divested businesses and may continue to divest additional businesses or assets in the future.
Acquisitions, divestments, investments, joint ventures and other transactional activities may require significant resources and/or result in significant unanticipated losses, costs or liabilities. Over the past several years, acquisitions, such as Adenza, have been, or are expected to be, significant factors in our growth. We have divested businesses and may continue to divest additional businesses or assets in the future.
We rely on third parties to perform certain functions, and our business could be adversely affected if these third parties fail to perform as expected or experience service interruptions affecting our operations. We rely on third parties for regulatory, data center, cloud, data storage and processing, data content, clearing and other services.
We rely on third parties to perform certain functions, and our business could be adversely affected if these third parties fail to perform as expected or experience service interruptions affecting our operations. We rely on third parties for regulatory, data center, cloud computing, data storage and processing, connectivity, data content, clearing, maintaining markets and exchange liquidity and other services.
Poor economic conditions may result in a reduction in the demand for our products and services, including our market technology, FRAML solutions, data, indexes and corporate solutions, or could result in a decline in the number of IPOs, reduced trading volumes or values and deterioration of the economic welfare of our listed companies, which could cause an increase in delistings.
Poor economic conditions may result in a reduction in the demand for our products and services, including our market technology, fraud detection, AML and surveillance solutions, data, indices and corporate solutions, or could result in a decline in the number of IPOs, reduced trading volumes or values and deterioration of the economic welfare of our listed companies, which could cause an increase in delistings.
If we do not achieve the expected operating results, we will need to reallocate our cash resources. This may include borrowing additional funds to service debt payments, which may impair our ability to make investments in our business or to integrate acquired businesses. If we need to raise funds through issuing additional equity, our equity holders will suffer dilution.
If we do not achieve the expected operating results, we will need to reallocate our cash resources. This may include borrowing additional funds to service debt payments, which may impair our ability to make investments in our business or to integrate acquired businesses.
We intend to launch new products and initiatives and continue to explore and pursue opportunities to strengthen our business and grow our company. We may spend substantial time and money developing new products, such as our digital assets offering, initiatives and enhancements to existing products.
We intend to launch new products and initiatives and continue to explore and pursue opportunities to strengthen our business and grow our company. We may spend substantial time and money developing new products, initiatives and enhancements to existing products.
Changes in tax laws, regulations or policies could result in us having to pay higher taxes, which may reduce our net income, or could adversely affect our ability to continue our 28 capital allocation program or effect strategic transactions in a tax-favorable manner.
Changes in tax laws, regulations or policies could have a material adverse effect on our financial results. Changes in tax laws, regulations or policies could result in us having to pay higher taxes, which may reduce our net income, or could adversely affect our ability to continue our capital allocation program or effect strategic transactions in a tax-favorable manner.
RISKS RELATED TO TRANSACTIONAL ACTIVITIES AND STRATEGIC RELATIONSHIPS We may not be able to successfully integrate acquired businesses, which may result in an inability to realize the anticipated benefits of our acquisitions. We must rationalize, coordinate and integrate the operations of our acquired businesses.
RISKS RELATED TO TRANSACTIONAL ACTIVITIES AND STRATEGIC RELATIONSHIPS We may not be able to successfully integrate acquired businesses, which may result in an inability to realize the anticipated benefits of our acquisitions. We must rationalize, coordinate and integrate the operations of our acquired businesses, including the acquisition of Adenza, which was completed in November 2023.
Although under current law we are immune from private suits arising from conduct within our regulatory authority and from acts and forbearances incident to the exercise of our regulatory authority, this immunity only covers certain of our activities in the U.S., and we could be exposed to liability under national and local laws, court decisions and rules and regulations promulgated by regulatory agencies. 27 We face risks related to compliance with economic sanctions (including those administered by the U.S.
Although under current law we are immune from private suits arising from conduct within our regulatory authority and from acts and forbearances incident to the exercise of our regulatory authority, this immunity only covers certain of our activities in the U.S., and we could be exposed to liability under national and local laws, court decisions and rules and regulations promulgated by regulatory agencies.
We have in the past lowered prices, and in the U.S., increased rebates for trade executions to attempt to gain or maintain market share. These strategies have not always been successful and have at times hurt operating performance.
In particular, the trading industry is characterized by price competition. We have in the past lowered prices, and in the U.S., increased rebates for trade executions to attempt to gain or maintain market share. These strategies have not always been successful and have at times hurt operating performance.
If these products and initiatives are not successful or their launches are delayed, including for regulatory uncertainty related to our digital assets offering, we may not be able to offset their costs, which could have an adverse effect on our business, financial condition and operating results.
If these products and initiatives are not successful or their launches are delayed, we may not be able to offset their costs, which could have an adverse effect on our business, financial condition and operating results.
Nasdaq, as technology provider to the UTP Operating Committee, has implemented measures to enhance the resiliency of the existing processor system. Nasdaq transferred the processor technology platform to our INET platform and this migration further enhanced the resiliency of the processor systems. We further improved the systems' resiliency by adding the UTP SnapShot service.
Nasdaq, as technology provider to the UTP Operating Committee, has implemented measures to enhance the resiliency of the existing processor system. Nasdaq transferred the processor technology platform to our INET platform and this migration further enhanced the resiliency of the processor systems.
Such new regulations, whether in the U.S. or in other countries in which we operate, could also cause us to incur additional compliance and reporting costs. 32 Our businesses operate in various international markets, including certain emerging markets that are subject to greater political, economic and social uncertainties than developed countries.
Such new regulations, whether in the U.S. 31 or in other countries in which we operate, could also cause us to incur additional compliance and reporting costs. Our businesses operate in various international markets, which are subject to political, economic and social uncertainties.
Regulatory authorities could impose regulatory changes that could impact the ability of our customers to use our exchanges. The loss of a significant number of customers or a reduction in trading activity on any of our exchanges as a result of such changes could have a material adverse effect on our business, financial condition and operating results.
The loss of a significant number of customers or a reduction in trading activity on any of our exchanges as a result of such changes could have a material adverse effect on our business, financial condition and operating results.
Office of Foreign Assets Control), export controls, corruption (including the U.S. Foreign Corrupt Practices Act) and money laundering. While we maintain compliance programs to prevent and detect potential violations, such programs cannot completely eliminate the risk of non-compliance.
We face risks related to compliance with economic sanctions (including those administered by the U.S. Office of Foreign Assets Control), export controls, corruption (including the U.S. Foreign Corrupt Practices Act) and money laundering. While we maintain compliance programs to prevent and detect potential violations, such programs cannot completely eliminate the risk of non-compliance.
Our business operates certain systems that may be considered “critical infrastructure” under certain regulations and licenses or sells certain systems or services to customers that are used by customers to fulfill certain core business requirements or process certain sensitive data.
Our business operates certain systems that may be considered “critical infrastructure” under certain regulations and licenses or sells certain systems or services to customers that are used by customers in their role as providers of critical infrastructure or to fulfill certain core business requirements or process certain sensitive data.
Competitors may leverage data more effectively or enter into strategic partnerships, mergers or acquisitions that could make their trading, listings, clearing, data or technology businesses more competitive than ours. We face intense price competition in all areas of our business. In particular, the trading industry is characterized by price competition.
Competitors may develop market trading platforms that are more competitive than ours. Competitors may leverage data more effectively or enter into strategic partnerships, mergers or acquisitions that could make their trading, listings, clearing, data or technology businesses more competitive than ours. We face intense price competition in all areas of our business.
Further, our failure to anticipate or respond adequately to changes in technology and customer preferences or any significant delays in product development efforts, could have a material adverse effect on our business, financial condition and operating results. Failure to attract and retain key personnel may adversely affect our ability to conduct our business.
Further, our failure to anticipate or respond adequately to changes in technology and customer preferences or any significant delays in product development efforts, could have a material adverse effect on our business, financial condition and operating results.
We hold a number of patents, patent applications and licenses in the United States and other foreign jurisdictions. However, effective trademark, copyright, patent and trade secret protection might not be available or cost-effective in every country in which our services and products are offered.
We hold a number of patents, patent applications and licenses in the United States and other foreign jurisdictions. However, effective trademark, copyright, patent and trade secret protection might not be available or cost-effective in every country in which we offer our services and products. Moreover, changes in patent law, regulation or practices at the U.S.
Any system issue, whether as a result of an intentional breach, collateral damage from a new virus or a non-malicious act, or due to a cybersecurity breach of a customer that results in a loss of our data or compromises our systems or those of our other customers utilizing the same products, could damage our reputation and result in: a loss of customers; disrupted customer relationships; the loss of our intellectual property or sensitive data; lower trading volumes 21 or values, incur significant liabilities or otherwise have a negative impact on our business, our products and services, financial condition and operating results.
Any system issue, whether as a result of an intentional breach, collateral damage from a new virus or a non-malicious act, the use of artificial intelligence by bad actors, including the use of such tools to engage in social engineering or similar activities, or due to a cybersecurity breach of a customer that results in a loss of our data or compromises our systems or those of our other customers utilizing the same products, could damage our reputation and result in: a loss of customers; disrupted customer relationships; the loss of our intellectual property or sensitive 20 data; lower trading volumes or values, significant liabilities, litigation or regulatory fines or otherwise have a negative impact on our business, our products and services, financial condition and operating results.
Furthermore, new listings from IPOs, including SPACs, decreased in 2022. A prolonged decrease in the number of listings, or failure of existing SPACs to successfully complete transactions with target companies and dissolve, could negatively impact the growth of our revenues.
In 2023, we again experienced a decrease in new listings from IPOs, including SPACs, and an increase in delistings. A prolonged decrease in the number of listings, or failure of existing SPACs to successfully complete transactions with target companies and dissolve, could negatively impact the growth of our revenues.
We communicate certain ESG-related initiatives, goals, and/or commitments regarding environmental matters, diversity, vendors and suppliers and other matters in our annual Sustainability Report, Task Force on Climate-related Financial Disclosures, or TCFD, Report, on our website, in our filings with the SEC, and elsewhere. These initiatives, goals, or commitments could be difficult to achieve and costly to implement.
We communicate certain ESG-related initiatives, goals, and/or commitments regarding environmental matters, social matters, vendors and suppliers and other matters in our annual Sustainability Report, Task Force on Climate-related Financial Disclosures, on our website, in our filings with the SEC and elsewhere.
In addition, such changes, including federal or state financial transaction taxes, may increase the cost of our offerings or services, which may cause our clients to reduce their use of our services. In addition, some of our subsidiaries are subject to tax in the jurisdictions in which they are organized or operate.
In addition, such changes, including federal or state financial transaction taxes, may increase the cost of our offerings or services, which may cause our clients to reduce their use of our services.
Moreover, changes in patent law, such as changes in the law regarding patentable subject matter, could also impact our ability to obtain patent protection for our innovations. There is also a risk that the scope of protection under our patents may not be sufficient in some cases, or that existing patents may be deemed invalid or unenforceable.
Patent and Trademark Office and/or analogous offices in other jurisdictions, such as changes in the law regarding patentable subject matter, could also impact our ability to obtain patent protection for our innovations. The scope of protection under our patents may not be sufficient in some cases, or existing patents may be deemed invalid or unenforceable.
As we intend to defend any such litigation actively, significant legal expenses could be incurred. Although we carry insurance that may limit our risk of damages in some cases, we still may sustain uncovered losses or losses in excess of available insurance that would affect our business, financial condition and results of operations.
Although we carry insurance that may limit our risk of damages in some cases, we still may incur significant legal expenses and may sustain uncovered losses or losses in excess of available insurance that would affect our business, financial condition and results of operations.
Our future success depends, in large part, upon our ability to attract and retain highly qualified and skilled professional personnel that can learn and embrace new technologies. In the current tight labor market, we have intensified our efforts to recruit and retain talent. Competition for key personnel in the various localities and business segments in which we operate is intense.
Failure to attract and retain key personnel may adversely affect our ability to conduct our business. Our future success depends, in large part, upon our ability to attract and retain highly qualified and skilled professional personnel that can learn and embrace new technologies. In the current tight labor market, we have intensified our efforts to recruit and retain talent.
Because anti-financial crime management solutions comprises one of our primary business offerings, a significant compliance event involving one of these areas could more negatively impact our business than a comparable business without this service offering.
Since our Financial Crime Management Technology and surveillance solutions are important offerings, a significant compliance event involving one of these areas could more negatively impact our business than a comparable business without this service offering.
Interruptions or delays in services from our third-party data center hosting facilities or cloud computing platform providers could impair the delivery of our services and harm our business.
Interruptions or delays in services from our third-party providers could impair the delivery of our services and harm our business.
We are exposed to credit risk from third parties, including customers, counterparties and clearing agents. We are exposed to credit risk from third parties, including customers, counterparties and clearing agents. These parties may default on their obligations to us due to bankruptcy, lack of liquidity, operational failure or other reasons.
We are exposed to credit risk from third parties, including customers, counterparties and clearing agents. These parties may default on their obligations to us due to bankruptcy, lack of liquidity, operational failure or other reasons. We clear a range of equity-related and fixed-income-related derivative products, commodities and resale and repurchase agreements.
The industries we operate in are highly competitive. We face significant competition in our Market Platforms, Capital Access Platforms and Anti-Financial Crime businesses from other market participants. We face intense competition from other exchanges and markets for market share of trading activity and listings. This competition includes both product and price competition.
We face significant competition in our Capital Access Platforms, Financial Technology and Market Services segments from other market participants. We face intense competition from other exchanges and markets for market share of trading activity and listings. This competition includes both product and price competition.
Beginning in 2020, trading and clearing volumes and values across our markets have fluctuated significantly depending on market conditions and other factors beyond our control.
Over the past several years, trading and clearing volumes and values across our markets have fluctuated significantly depending on market conditions and other factors beyond our control.
We may be adversely impacted by the financial distress or failure of a clearing member, which may cause us negative financial impact, reputational harm or regulatory consequences, including litigation or regulatory enforcement actions.
We may be adversely impacted by the financial distress or failure of a clearing member, which may cause us negative financial impact, reputational harm or regulatory consequences, including litigation or regulatory enforcement actions. We are exposed to credit risk from third parties, including customers, counterparties and clearing agents.
The authorities are also entitled to request that we adopt measures in order to ensure that we continue to fulfill the authorities’ requirements. Additionally, we are subject to the obligations under the Benchmark Regulation ((EU) 2016/1011), compliance with which could be costly or cause a change in our business practices. Certain of our customers operate in a highly regulated industry.
Additionally, we are subject to the obligations under the Benchmark Regulation ((EU) 2016/1011), compliance with which could be costly or cause a change in our business practices. Certain of our customers operate in a highly regulated industry. Regulatory authorities could impose regulatory changes that could impact the ability of our customers to use our exchanges.
This may have an adverse effect on our brands, business and operating results. Damage to our reputation could cause some issuers not to list their securities on our exchanges or switch to a different exchange.
Damage to our reputation could cause some issuers not to list their securities on our exchanges or switch to a different exchange. Reputational damage may also reduce trading volumes or values on our exchanges or cause us to lose customers. This may have a material adverse effect on our business, financial condition and operating results.
We have, and may continue to, experience higher compensation costs to retain personnel, and hire new talent, that may not be offset by improved productivity, higher revenues or increased sales.
Competition for key personnel in 21 the various localities and business segments in which we operate is intense. We have, and may continue to, experience higher compensation costs to retain personnel, and hire new talent, that may not be offset by improved productivity, higher revenues or increased sales.
In December 2022, the SEC proposed significant rule changes that, if adopted in their current form, would substantially alter how stocks are traded in the United States.
In December 2022, the SEC proposed significant rule changes that, if adopted in their current form, would substantially alter how stocks are traded in the United States. In October 2023, the SEC proposed to require exchanges to modify their pricing practices for certain types of transactions.
In addition to increased regulatory obligations, implementation of a consolidated audit trail has resulted in significant additional expenditures, including to implement the new technology to meet any of the plan’s requirements. Creating the CAT has required the development and implementation of complex and costly technology.
In addition to increased regulatory obligations, implementation of a CAT has resulted in significant additional expenditures, including to implement the new technology to meet many of the plan’s requirements. Creating the CAT has required the development and implementation of complex and costly technology. This development effort has been funded by the SROs (including Nasdaq) in exchange for promissory notes.
Furthermore, if adverse economic conditions occur, we could experience decreased revenues from our operations which could affect our ability to satisfy financial and other restrictive covenants to which we are subject under our existing indebtedness. 29 RISKS RELATED TO INTELLECTUAL PROPERTY AND BRAND REPUTATION Damage to our reputation or brand name could have a material adverse effect on our businesses.
Furthermore, if adverse economic conditions occur, we could experience decreased revenues from our operations which could affect our ability to satisfy financial and other restrictive covenants to which we are subject under our existing indebtedness.
Our businesses operate in various international markets, including but not limited to Northern Europe, the Baltics, the Middle East, Africa and Asia, and our non-U.S. operations are subject to the risk inherent in the international environment. Political, economic or social events or developments in one or more of our non-U.S. locations could adversely affect our operations and financial results.
Our businesses operate in various international markets, including but not limited to Northern Europe, the Baltics, the Middle East, Latin America, Africa and Asia, and our non-U.S. operations are subject to the risk inherent in the international environment.
Any one of these factors could have a material adverse effect on our business, financial condition and operating results by causing a substantial decline in the financial services markets and reducing trading volumes or values. 31 Additionally, since borrowings under our credit facilities bear interest at variable rates and commercial paper is issued at prevailing interest rates, any increase in interest rates on debt that we have not fixed using interest rate hedges will increase our interest expense, reduce our cash flow or increase the cost of future borrowings or refinancings.
Additionally, since borrowings under our credit facilities bear interest at variable rates and commercial paper is issued at prevailing interest rates, any increase in interest rates on debt that we have not fixed using interest rate hedges will increase our interest expense, reduce our cash flow or increase the cost of future borrowings or refinancings.
Laws and regulations such as the European Union and United Kingdom General Data Protection Regulation, or GDPR, the California Privacy Rights Act, or CPRA, and other comparable laws and regulations adopted globally and within the United States and Canada can apply to our processing of their residents' personal data by Nasdaq legal entities regardless of the location of such entities; such laws may also require our customers located in such jurisdictions to contractually obligate Nasdaq to comply.
Laws and regulations such as the European Union and United Kingdom General Data Protection Regulation, the California Privacy Rights Act and other comparable laws and regulations adopted globally and within the United States and Canada can apply to our processing of their residents’ personal data by Nasdaq legal entities regardless of the location of such entities; such laws may also require our customers located in such jurisdictions to contractually obligate our compliance. 28 In addition to directly applying to some of our business activities, these laws and industry-specific regulations, such as the Health Insurance Portability and Accountability Act and the Gramm Leach Bliley Act, impact many of our customers, which may affect their decisions to purchase our services.
We clear a range of equity-related and fixed-income-related derivative products, commodities and resale and repurchase agreements. We assume the counterparty risk for all transactions that are cleared through Nasdaq Clearing on our markets and guarantee that our cleared contracts will be honored.
We assume the counterparty risk for all transactions that are cleared through Nasdaq Clearing on our markets and guarantee that our cleared contracts will be honored.
As of December 31, 2022, goodwill totaled $8.1 billion and intangible assets, net of accumulated amortization, totaled $2.6 billion. The determination of the value of such goodwill and intangible assets requires management to make estimates and assumptions that affect our consolidated financial statements.
The determination of the value of such goodwill and intangible assets requires management to make estimates and assumptions that affect our consolidated financial statements.
Further, cybersecurity incidents that impact our vendors and other third parties that support our organization and industry could directly or indirectly impact us. There can be no assurance we will be able to identify and mitigate every incident involving cybersecurity attacks, breaches or incidents. A system breach may go undetected for an extended period of time.
There can be no assurance we will be able to identify and mitigate every incident involving cybersecurity attacks, breaches or incidents. A system breach may go undetected for an extended period of time. Expanded cybersecurity regulations, and increased cybersecurity infrastructure and compliance costs, may adversely impact our results of operations.
We also rely on members of our trading community to maintain markets and add liquidity. To the extent that any of our largest members experience difficulties, materially change their business relationship with us or are unable for any reason to perform market making activities, our business or our reputation may be materially adversely affected.
To the extent that any of our largest members experience difficulties, materially change their business relationship with us or are unable for any reason to perform market making activities, our business or our reputation may be materially adversely affected. 23 We may be required to recognize impairments of our goodwill, intangible assets or other long-lived assets in the future.
We could fail to achieve, or be perceived to fail to achieve, this or other ESG-related initiatives, goals, or commitments. In addition, we could be criticized for the timing, scope or nature of these initiatives, goals, or commitments, or for any revisions to them.
In addition, we could be criticized for the timing, scope or nature of these initiatives, goals, or commitments, or for any revisions to them. We could be subject to litigation or regulatory enforcement actions regarding the accuracy, adequacy, or completeness of our ESG-related disclosures.
Although we monitor developments, including social media, for areas of potential risk to our brand and reputation, negative publicity or misrepresentations by third parties, particularly on social media, may adversely impact our credibility as a leader in the global capital markets and as a source for data and analytics.
Negative publicity or misrepresentations by third parties, particularly on social media, may adversely impact our credibility as a leader in the global capital markets and as a source for data and analytics. This may have an adverse effect on our brands, business and operating results.
In addition, adverse market conditions may cause reductions in the number of non-professional investors with investments in the market and in ETP AUM tracking Nasdaq indexes as well as trading in futures linked to Nasdaq indexes. 19 There may be less demand for our corporate solutions, market technology and FRAML products and services if global economic conditions remain weak.
In addition, adverse market conditions may cause reductions in the number of non-professional investors with investments in the market and in ETP AUM tracking Nasdaq indices as well as trading in futures linked to Nasdaq indices.
Our customers historically reduce purchases of new services and technology when growth rates decline, thereby diminishing our opportunities to sell new products and services or upgrade existing products and services.
There may be less demand for our analytics, corporate solutions, market technology and risk and regulatory products and services if global economic conditions remain weak. Our customers historically reduce purchases of new services and technology when growth rates decline, thereby diminishing our opportunities to sell new products and services or upgrade existing products and services.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe regularly monitor the facilities we occupy to ensure that they suit our needs, particularly as we have reopened all our global offices and our employees have transitioned to a hybrid work environment. We believe the facilities that we occupy are adequate for the purposes for which they are currently used and are well-maintained.
Biggest changeWe regularly monitor the facilities we occupy to ensure that they suit our needs in a hybrid work environment. We believe the facilities that we occupy are adequate for the purposes for which they are currently used and are well-maintained. See Note 16, “Leases,” to the consolidated financial statements for further discussion. 34
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See Note 16, “Leases,” to the consolidated financial statements for further discussion.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings For a description of our legal proceedings, if any, see “Legal and Regulatory Matters - Litigation,” of Note 18, “Commitments, Contingencies and Guarantees,” to the consolidated financial statements, which is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable. PART II
Biggest changeItem 3. Legal Proceedings For a description of our legal proceedings, if any, see “Legal and Regulatory Matters” of Note 18, “Commitments, Contingencies and Guarantees,” to the consolidated financial statements, which is incorporated herein by reference. Item 4. Mine Safety Disclosures Not applicable. PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe figures represented below assume an initial investment of $100 in the common stock or index at the closing price on December 31, 2017 and the reinvestment of all dividends.
Biggest changeFiscal Year Ended December 31, 2018 2019 2020 2021 2022 2023 Nasdaq, Inc. $ 100 $ 134 $ 169 $ 270 $ 240 $ 231 Nasdaq Composite Index 100 137 198 242 163 236 S&P 500 100 131 156 200 164 207 New Peer Group 100 125 139 188 167 193 2022 Peer Group 100 128 153 171 142 170 The figures represented below assume an initial investment of $100 in the common stock or index at the closing price on December 31, 2018 and the reinvestment of all dividends.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock is listed on The Nasdaq Stock Market under the ticker symbol “NDAQ.” As of February 13, 2023, we had approximately 209 holders of record of our common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Purchases of Equity Securities Market Information Our common stock is listed on The Nasdaq Stock Market under the ticker symbol “NDAQ.” As of February 13, 2024, we had approximately 202 holders of record of our common stock.
Issuer Purchases of Equity Securities Share Repurchase Program See “Share Repurchase Program,” of Note 12, “Nasdaq Stockholders’ Equity,” to the consolidated financial statements for further discussion of our share repurchase program. 34 Purchases of Equity Securities by the Issuer and Affiliated Purchasers The table below represents repurchases made by or on behalf of us or any “affiliated purchaser” of our common stock during the fiscal quarter ended December 31, 2022: Period (a) Total Number of Shares Purchased (b) Average Price Paid Per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) October 2022 Share repurchase program — $ — — $ 293 Employee transactions 27,913 $ 59.76 N/A N/A November 2022 Share repurchase program — $ — — $ 293 Employee transactions 231 $ 66.52 N/A N/A December 2022 Share repurchase program — $ — — $ 650 Employee transactions 56,480 $ 61.76 N/A N/A Total Quarter Ended December 31, 2022 Share repurchase program — $ — — $ 650 Employee transactions 84,624 $ 61.11 N/A N/A In the preceding table: • N/A - Not applicable. • See “Share Repurchase Program,” of Note 12, “Nasdaq Stockholders’ Equity,” to the consolidated financial statements for further discussion of our share repurchase program. • Employee transactions represents shares surrendered to us to satisfy tax withholding obligations arising from the vesting of restricted stock and PSUs previously issued to employees. 35 PERFORMANCE GRAPH The following performance graph and related information shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference into any of our other filings under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers The table below represents repurchases made by or on behalf of us or any “affiliated purchaser” of our common stock during the fiscal quarter ended December 31, 2023: Period (a) Total Number of Shares Purchased (b) Average Price Paid Per Share (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (d) Maximum Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in millions) October 2023 Share repurchase program — $ — — $ 2,000 Employee transactions 19,360 $ 48.85 N/A N/A November 2023 Share repurchase program 1,751,513 $ 52.36 1,751,513 $ 1,908 Employee transactions — $ — N/A N/A December 2023 Share repurchase program 333,261 $ 54.44 333,261 $ 1,890 Employee transactions 17,883 $ 56.22 N/A N/A Total Quarter Ended December 31, 2023 Share repurchase program 2,084,774 $ 52.69 2,084,774 $ 1,890 Employee transactions 37,243 $ 52.39 N/A N/A In the preceding table: • N/A - Not applicable. • See “Share Repurchase Program,” of Note 12, “Nasdaq Stockholders’ Equity,” to the consolidated financial statements for further discussion of our share repurchase program. • Employee transactions represents shares surrendered to us to satisfy tax withholding obligations arising from the vesting of restricted stock and PSUs previously issued to employees. 35 PERFORMANCE GRAPH The following performance graph and related information shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference into any of our other filings under the Securities Act or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
The following graph compares the total return of our common stock to the Nasdaq Composite Index, the S&P 500 and a peer group selected by us, shown below, for the past five years: Peer Group • ASX Limited • Deutsche Börse AG • LSE • B3 S.A. • Euronext N.V. • Singapore Exchange Limited • Bolsas Mexicana de Valores, S.A.B. de C.V. • Hong Kong Exchanges and Clearing Limited • TMX Group Limited • Cboe • ICE • CME Group Inc. • Japan Exchange Group, Inc.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN Among Nasdaq, Inc., the Nasdaq Composite Index, the S&P 500 and Peer Groups The prior peer group, collectively referred to as the 2022 Peer Group, was comprised of the following companies: 2022 Peer Group • ASX Limited • Deutsche Börse AG • LSE • B3 S.A. • Euronext N.V. • Singapore Exchange Limited • Bolsas Mexicana de Valores, S.A.B. de C.V. • Hong Kong Exchanges and Clearing Limited • TMX Group Limited • Cboe • ICE • CME Group Inc. • Japan Exchange Group, Inc. 36 Item 6. [Reserved]
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COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN* Among Nasdaq, Inc., the Nasdaq Composite Index, the S&P 500, and a Peer Group * $100 invested on 12/31/2017 in stock or index, including reinvestment of dividends.
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Issuer Purchases of Equity Securities Share Repurchase Program See “Share Repurchase Program,” of Note 12, “Nasdaq Stockholders’ Equity,” to the consolidated financial statements for further discussion of our share repurchase program.
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Fiscal Year Ended December 31, 2017 2018 2019 2020 2021 2022 Nasdaq, Inc. $ 100 $ 108 $ 145 $ 183 $ 293 $ 260 Nasdaq Composite Index 100 97 133 192 235 159 S&P 500 100 96 126 149 192 157 Peer Group 100 112 149 186 208 184 36 Item 6. [Reserved]
Added
The following graph compares the total return of our common stock to the Nasdaq Composite Index, the S&P 500 and a peer group selected by us for the past five years.
Added
We changed our peer group in the table below to the S&P 500 GICS 4020 Index, or New Peer Group, which is a blend of exchanges, as well as data, financial technology and banking companies to align more closely with Nasdaq’s diverse business and competitors.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe decrease in market technology revenues in 2021 was primarily due to lower professional services revenues, partially offset by an increase in SaaS revenues. 43 CAPITAL ACCESS PLATFORMS The following tables present revenues and key drivers from our Capital Access Platforms segment: Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions) Data & Listing Services $ 729 $ 680 $ 574 7.2 % 18.5 % Index 486 459 324 5.9 % 41.7 % Workflow & Insights 469 429 389 9.3 % 10.3 % Total Capital Access Platforms $ 1,684 $ 1,568 $ 1,287 7.4 % 21.8 % As of or Three Months Ended December 31, 2022 2021 2020 (in millions) ARR $ 1,192 $ 1,113 $ 986 Quarterly annualized SaaS revenues $ 388 $ 356 $ 323 Data & Listing Services Revenues The following tables present key drivers from our Data & Listing Services business: Year Ended December 31, 2022 2021 2020 IPOs The Nasdaq Stock Market 161 752 316 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 38 174 45 Total new listings The Nasdaq Stock Market 366 1,000 454 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 63 207 67 Number of listed companies The Nasdaq Stock Market 4,230 4,178 3,392 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 1,251 1,235 1,071 In the tables above: • The Nasdaq Stock Market new listings include IPOs, including issuers that switched from other listing venues and separately listed ETPs.
Biggest changeCAPITAL ACCESS PLATFORMS The following table presents revenues from our Capital Access Platforms segment: Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions) Data & Listing Services $ 749 $ 727 $ 678 3.0 % 7.2 % Index 528 486 459 8.6 % 5.9 % Workflow & Insights 493 469 429 5.1 % 9.3 % Total Capital Access Platforms $ 1,770 $ 1,682 $ 1,566 5.2 % 7.4 % Data & Listing Services Revenues The following table presents key drivers from our Data & Listing Services business: Year Ended December 31, 2023 2022 2021 IPOs The Nasdaq Stock Market - operating companies 103 87 319 The Nasdaq Stock Market - SPACs 27 74 433 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 7 38 174 Total new listings The Nasdaq Stock Market 330 366 1,000 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 23 63 207 Number of listed companies The Nasdaq Stock Market 4,044 4,230 4,178 Exchanges that comprise Nasdaq Nordic and Nasdaq Baltic 1,218 1,251 1,235 As of December 31, 2023 2022 2021 ARR (in millions) $ 682 $ 664 $ 627 In the tables above: • Number of total listed companies on The Nasdaq Stock Market for the years ended December 31, 2023, 2022 and 2021 included 600, 528 and 441 ETPs, respectively. • IPOs, new listings (which includes IPOs) and total listed companies for exchanges that comprise Nasdaq Nordic and Nasdaq Baltic represent companies listed on the Nasdaq Nordic and Nasdaq Baltic exchanges and companies on the alternative markets of Nasdaq First North. 39 Data & Listing Services revenues increased in 2023 compared with 2022 primarily due to an increase in proprietary data revenues driven largely by higher international demand and annual listing fee growth, partially offset by lower initial listings fees.
Net Cash Provided by Financing Activities Net cash provided by financing activities for the year ended December 31, 2022 primarily related to an increase in default funds and margin deposits of $2,440 million, proceeds of $541 million from the issuance of long-term-debt and proceeds of $238 million from the issuances of our commercial paper, net, partially offset by $1,097 million related to the repayment of our 2022 and 2024 Notes, $383 million of dividend payments to our shareholders, $325 million of repurchases of common stock pursuant to the ASR agreement and $308 million in other repurchases of common stock.
Net cash provided by financing activities for the year ended December 31, 2022 primarily related to an increase in default funds and margin deposits of $2,440 million, proceeds of $541 million from the issuances of long-term-debt and proceeds of $238 million from the issuances of our commercial paper, net, partially offset by $1,097 million related to the repayment of our 2022 and 2024 Notes, $383 million of dividend payments to our shareholders, $325 million of repurchases of common stock pursuant to the ASR agreement and $308 million in other repurchases of common stock.
Under ASC 350-20, “Intangibles Goodwill and Other,” when a company reorganizes its reporting structure, an impairment test must be performed both before and after the change, and goodwill must be reassigned to reporting units. Accordingly, goodwill was reassigned based on relative fair value of each reporting unit. We perform our goodwill impairment test at the reporting unit level.
Under ASC 350-20, “Intangibles Goodwill and Other,” when a company reorganizes its reporting structure, an impairment test must be performed both before and after the change, and goodwill must be reassigned to reporting units. Accordingly, goodwill was reassigned based on relative fair value of each reporting unit. 53 We perform our goodwill impairment test at the reporting unit level.
In this interim period, Nasdaq Execution Services is not novating like a clearing broker but instead is subject to the short-term risk of counterparty failure before the clearinghouse enters the transaction. Once the clearinghouse officially accepts the trade for novation, Nasdaq Execution Services is legally removed from trade execution risk.
In this interim period, Nasdaq Execution Services is not novating like a clearing broker but instead is subject to the short-term risk of counterparty failure before 51 the clearinghouse enters the transaction. Once the clearinghouse officially accepts the trade for novation, Nasdaq Execution Services is legally removed from trade execution risk.
See “Equity Method Investments,” of Note 6, “Investments,” to the consolidated financial statements for further discussion. 47 • Other items: We have excluded certain other charges or gains, including certain tax items, that are the result of other non-comparable events to measure operating performance.
See “Equity Method Investments,” of Note 6, “Investments,” to the consolidated financial statements for further discussion. • Other items: We have excluded certain other charges or gains, including certain tax items, that are the result of other non-comparable events to measure operating performance.
When funds are not held at a central bank, we seek to substantially mitigate credit risk by ensuring that investments are primarily placed in large, highly rated financial institutions, highly rated government debt instruments and other creditworthy counterparties. 54 • Liquidity Risk.
When funds are not held at a central bank, we seek to substantially mitigate credit risk by ensuring that investments are primarily placed in large, highly rated financial institutions, highly rated government debt instruments and other creditworthy counterparties. • Liquidity Risk.
Impacts on our revenues less transaction-based expenses and operating income associated with fluctuations in foreign currency are discussed in more detail under “Item 7A. Quantitative and Qualitative Disclosures about Market Risk.” The following chart summarizes our ARR (in millions): 37 ARR for a given period is the annualized revenue derived from subscription contracts with a defined contract value.
Impacts on our revenues less transaction-based expenses and operating income associated with fluctuations in foreign currency are discussed in more detail under “Item 7A. Quantitative and Qualitative Disclosures about Market Risk.” 37 The following chart summarizes our ARR (in millions): ARR for a given period is the current annualized value derived from subscription contracts with a defined contract value.
We allocate the contract transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract.
We allocate the contract transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct 52 good or service in the contract.
See Note 9, “Debt Obligations,” to the consolidated financial statements for further discussion. • Operating lease obligations represent our undiscounted operating lease liabilities as of December 31, 2022, as well as legally binding minimum lease payments for leases signed but not yet commenced.
See Note 9, “Debt Obligations,” to the consolidated financial statements for further discussion. • Operating lease obligations represent our undiscounted operating lease liabilities as of December 31, 2023, as well as legally binding minimum lease payments for leases signed but not yet commenced.
Equity Derivative Trading The following tables present total revenues, transaction-based expenses, and total revenues less transaction-based expenses as well as key drivers from our U.S. Equity Derivative Trading business: Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions) U.S.
Equity Derivative Trading The following tables present total revenues, transaction-based expenses, and total revenues less transaction-based expenses as well as key drivers from our U.S. Equity Derivative Trading business: Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions) U.S.
Any required impairment loss is measured as the amount by which the carrying amount of the asset exceeds its fair value and is recorded as a reduction in the carrying amount of the related asset and a charge to operating results. There were no material finite-lived intangible assets impairment charges in 2022 and 2020.
Any required impairment loss is measured as the amount by which the carrying amount of the asset exceeds its fair value and is recorded as a reduction in the carrying amount of the related asset and a charge to operating results. 54 There were no material finite-lived intangible assets impairment charges in 2023 and 2022.
GAAP net income attributable to Nasdaq and diluted earnings per share and non-GAAP net income attributable to Nasdaq and diluted earnings per share: Year Ended December 31, 2022 2021 2020 (in millions, except per share amounts) U.S.
GAAP net income attributable to Nasdaq and diluted earnings per share and non-GAAP net income attributable to Nasdaq and diluted earnings per share: Year Ended December 31, 2023 2022 2021 (in millions, except per share amounts) U.S.
Additionally, for the years ended December 31, 2021 and 2020, other revenues include revenues associated with the NPM business which we contributed in July 2021 to a standalone, independent company, of which we own the largest minority interest, together with a consortium of third-party financial institutions. Prior to July 2021, these revenues were included in our Capital Access Platforms segment.
Additionally, for the year ended December 31, 2021, other revenues include revenues associated with the NPM business which we contributed in July 2021 to a standalone, independent company, of which we own the largest minority interest, together with a consortium of third-party financial institutions. Prior to July 2021, these revenues were included in our Capital Access Platforms segment.
Revenue Recognition Market technology revenues As part of our market technology product offering, within our Marketplace Technology business, we enter into certain long-term contracts with customers to develop customized technology solutions, license the right to use software and provide support and other services to our customers which results in these contracts containing multiple performance obligations.
Revenue Recognition As part of our market technology product offering, we enter into certain long-term contracts with customers to develop customized technology solutions, license the right to use software and provide support and other services to our customers which results in these contracts containing multiple performance obligations.
Year Ended December 31, 2022 2021 2020 Nasdaq Nordic and Nasdaq Baltic options and futures Total average daily volume of options and futures contracts 296,626 287,182 320,204 In the tables above, Nasdaq Nordic and Nasdaq Baltic total average daily volume of options and futures contracts include Finnish option contracts traded on Eurex for which Nasdaq and Eurex have a revenue sharing arrangement.
Year Ended December 31, 2023 2022 2021 Nasdaq Nordic and Nasdaq Baltic options and futures Total average daily volume of options and futures contracts 301,320 296,626 287,182 In the tables above, Nasdaq Nordic and Nasdaq Baltic total average daily volume of options and futures contracts include Finnish option contracts traded on Eurex for which Nasdaq and Eurex have a revenue sharing arrangement.
Of these securities, $161 million as of December 31, 2022 and $162 million December 31, 2021, are assets primarily utilized to meet regulatory capital requirements, mainly for our clearing operations at Nasdaq Clearing. See Note 6, “Investments,” to the consolidated financial statements for further discussion.
Of these securities, $168 million as of December 31, 2023 and $161 million as of December 31, 2022 are assets primarily utilized to meet regulatory capital requirements, mainly for our clearing operations at Nasdaq Clearing. See Note 6, “Investments,” to the consolidated financial statements for further discussion.
Discussion of fiscal year 2021 items and the year-over year comparison of changes in our financial condition and results of operations as of and for the fiscal years ended December 31, 2021 and December 31, 2020 can be found in Part II, “Item 7.
Business.” Discussion of fiscal year 2022 items and the year-over year comparison of changes in our financial condition and results of operations as of and for the fiscal years ended December 31, 2022 and December 31, 2021 can be found in Part II, “Item 7.
As of December 31, 2022, the combined required minimum net capital totaled $1 million and the combined excess capital totaled $18 million, substantially all of which is held in cash and cash equivalents in the Consolidated Balance Sheets. The required minimum net capital is included in restricted cash and cash equivalents in the Consolidated Balance Sheets.
As of December 31, 2023, the combined required minimum net capital totaled $1 million and the combined excess capital totaled $27 million, substantially all of which is held in cash and cash equivalents in the Consolidated Balance Sheets. The required minimum net capital is included in restricted cash and cash equivalents in the Consolidated Balance Sheets.
In addition, for the year ended December 31, 2021, the non-GAAP adjustment to the income tax provision includes adjustments related to return-to-provision and a prior year tax benefit. The following tables present reconciliations between U.S.
In addition, for the year ended December 31, 2021, the non-GAAP adjustment to the income tax provision includes adjustments related to return-to-provision. The following tables present reconciliations between U.S.
As of December 31, 2022, our required regulatory capital of $34 million was primarily invested in European mortgage bonds and Icelandic government bonds that are included in financial investments in the Consolidated Balance Sheets and cash, which is included in restricted cash and cash equivalents in the Consolidated Balance Sheets.
As of December 31, 2023, our required regulatory capital of $37 million was primarily invested in European government bills and mortgage bonds and Icelandic government bonds that are included in financial investments in the Consolidated Balance Sheets and cash, which is included in restricted cash and cash equivalents in the Consolidated Balance Sheets.
Tax Matters The following table presents our income tax provision and effective tax rate: Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions) Income tax provision $ 352 $ 347 $ 279 1.4 % 24.4 % Effective tax rate 23.9 % 22.6 % 23.0 % For further discussion of our tax matters, see Note 17, “Income Taxes,” to the consolidated financial statements.
Tax Matters The following table presents our income tax provision and effective tax rate: Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions) Income tax provision $ 344 $ 352 $ 347 (2.3) % 1.4 % Effective tax rate 24.6 % 23.9 % 22.6 % For further discussion of our tax matters, see Note 17, “Income Taxes,” to the consolidated financial statements.
The balance retained in cash and cash equivalents is a function of anticipated or possible short-term cash needs, prevailing interest rates, our investment policy, and alternative investment choices. As of December 31, 2022, our cash and cash equivalents of $502 million were primarily invested in bank deposits, money market funds and commercial paper.
The balance retained in cash and cash equivalents is a function of anticipated or possible short-term cash needs, prevailing interest rates, our investment policy, and alternative investment choices. As of December 31, 2023, our cash and cash equivalents of $453 million were primarily invested in money market funds, commercial paper, municipal bonds and bank deposits.
NON-GAAP FINANCIAL MEASURES In addition to disclosing results determined in accordance with U.S. GAAP, we also provide non-GAAP net income attributable to Nasdaq and non-GAAP diluted earnings per share. Management uses this non-GAAP information internally, along with U.S. GAAP information, in evaluating our performance and in making financial and operational decisions.
NON-GAAP FINANCIAL MEASURES In addition to disclosing results determined in accordance with U.S. GAAP, we also provide non-GAAP net income attributable to Nasdaq and non-GAAP diluted earnings per share in this Annual Report on Form 10-K. Management uses this non-GAAP information internally, along with U.S. GAAP information, in evaluating our performance and in making financial and operational decisions.
See Note 4, “Acquisitions and Divestiture,” to the consolidated financial statements for further discussion of our acquisitions and divestiture. See Note 9, “Debt Obligations,” to the consolidated financial statements for further discussion of our debt obligations.
See Note 4, “Acquisitions,” to the consolidated financial statements for further discussion. See Note 9, “Debt Obligations,” to the consolidated financial statements for further discussion of our debt obligations.
GAAP effective tax rate 23.9 % 22.6 % 23.0 % Total adjustments from non-GAAP tax rate 0.1 % 1.7 % 3.0 % Non-GAAP effective tax rate 24.0 % 24.3 % 26.0 % Weighted-average common shares outstanding for diluted earnings per share 497.9 505.1 500.7 U.S.
GAAP effective tax rate 24.6 % 23.9 % 22.6 % Total adjustments from non-GAAP tax rate 0.4 % 0.1 % 1.7 % Non-GAAP effective tax rate 25.0 % 24.0 % 24.3 % Weighted-average common shares outstanding for diluted earnings per share 508.4 497.9 505.1 U.S.
Equity derivative trading revenues, net $ 371 $ 343 $ 287 8.2 % 19.5 % Section 31 fees are recorded as equity derivative and cash equity derivative trading revenues with a corresponding amount recorded in transaction-based expenses. We are assessed these fees from the SEC and pass them through to our customers in the form of incremental fees.
Equity derivative trading revenues, net $ 374 $ 371 $ 343 0.8 % 8.2 % Section 31 fees are recorded as U.S. equity derivative and cash equity trading revenues with a corresponding amount recorded in transaction-based expenses. We are assessed these fees from the SEC and pass them through to our customers in the form of incremental fees.
Year Ended December 31, 2022 2021 2020 Total U.S.-listed securities Total industry average daily share volume (in billions) 11.9 11.4 10.9 Matched share volume (in billions) 522.8 491.9 508.3 The Nasdaq Stock Market matched market share 16.2 % 15.8 % 16.8 % Nasdaq BX matched market share 0.5 % 0.6 % 0.9 % Nasdaq PSX matched market share 0.8 % 0.7 % 0.6 % Total matched market share executed on Nasdaq’s exchanges 17.5 % 17.1 % 18.3 % Market share reported to the FINRA/Nasdaq Trade Reporting Facility 35.2 % 34.9 % 31.8 % Total market share 52.7 % 52.0 % 50.1 % Nasdaq Nordic and Nasdaq Baltic securities Average daily number of equity trades executed on Nasdaq’s exchanges 908,813 1,036,523 933,822 Total average daily value of shares traded (in billions) $ 5.4 $ 6.4 $ 5.6 Total market share executed on Nasdaq’s exchanges 71.5 % 76.9 % 78.1 % In the tables above, total market shares includes transactions executed on The Nasdaq Stock Market’s, Nasdaq BX’s and Nasdaq PSX’s systems plus trades reported through the FINRA/Nasdaq Trade Reporting Facility.
Year Ended December 31, 2023 2022 2021 Total U.S.-listed securities Total industry average daily share volume (in billions) 11.0 11.9 11.4 Matched share volume (in billions) 455.6 522.8 491.9 The Nasdaq Stock Market matched market share 15.8 % 16.2 % 15.8 % Nasdaq BX matched market share 0.4 % 0.5 % 0.6 % Nasdaq PSX matched market share 0.3 % 0.8 % 0.7 % Total matched market share executed on Nasdaq’s exchanges 16.5 % 17.5 % 17.1 % Market share reported to the FINRA/Nasdaq Trade Reporting Facility 36.7 % 35.2 % 34.9 % Total market share 53.2 % 52.7 % 52.0 % Nasdaq Nordic and Nasdaq Baltic securities Average daily number of equity trades executed on Nasdaq’s exchanges 666,411 908,813 1,036,523 Total average daily value of shares traded (in billions) $ 4.5 $ 5.4 $ 6.4 Total market share executed on Nasdaq’s exchanges 71.0 % 71.5 % 76.9 % In the tables above, total market share includes transactions executed on The Nasdaq Stock Market’s, Nasdaq BX’s and Nasdaq PSX’s systems plus trades reported through the FINRA/Nasdaq Trade Reporting Facility.
As of December 31, 2022, our required regulatory capital of $125 million was comprised of highly rated European government debt securities that are included in financial investments in the Consolidated Balance Sheets.
As of December 31, 2023, our required regulatory capital of $123 million was primarily comprised of highly rated European government debt securities that are included in financial investments in the Consolidated Balance Sheets.
Goodwill represents the excess of purchase price over the value assigned to the net assets, including identifiable intangible assets, of a business acquired. Goodwill is allocated to our reporting units based on the assignment of the fair values of each reporting unit of the acquired company.
Goodwill, Indefinite-Lived Intangible Assets and Related Impairment Testing Goodwill represents the excess of purchase price over the value assigned to the net assets, including identifiable intangible assets, of a business acquired. Goodwill is allocated to our reporting units based on the assignment of the fair values of each reporting unit of the acquired company.
Net Cash Provided by (Used in) Investing Activities Net cash provided by investing activities for the year ended December 31, 2022 primarily related to net proceeds from sales and redemptions of investments related to default funds and margin deposits of $211 million and proceeds of $33 million from other investing activities, partially offset by purchases of property and equipment of $152 million and $41 million cash used for acquisitions, net of cash and cash equivalents acquired.
Net cash provided by investing activities for the year ended December 31, 2022 primarily related to net proceeds from sales and redemptions of defa ult fund s and margin deposits of $211 million and proceeds of $33 million from other investing activities, partially offset by purchases of property and equipment of $152 million and $41 million cash used for acquisitions, net of cash and cash equivalents acquired.
GAAP diluted earnings per share $ 2.26 $ 2.35 $ 1.86 Total adjustments from non-GAAP net income 0.40 0.17 0.20 Non-GAAP diluted earnings per share $ 2.66 $ 2.52 $ 2.06 48 LIQUIDITY AND CAPITAL RESOURCES Historically, we have funded our operating activities and met our commitments through cash generated by operations, augmented by the periodic issuance of debt.
GAAP diluted earnings per share $ 2.08 $ 2.26 $ 2.35 Total adjustments from non-GAAP net income 0.74 0.40 0.17 Non-GAAP diluted earnings per share $ 2.82 $ 2.66 $ 2.52 46 LIQUIDITY AND CAPITAL RESOURCES Historically, we have funded our operating activities and met our commitments through cash generated by operations, augmented by the periodic issuance of debt.
This excludes contracts that are not recurring, are one-time in nature, or where the contract value fluctuates based on defined metrics. Also excluded are contracts that are signed but not yet commenced. ARR is one of our key performance metrics to assess the health and trajectory of our recurring business.
This excludes contracts that are not recurring, are one-time in nature, or where the contract value fluctuates based on defined metrics. ARR is currently one of our key performance metrics to assess the health and trajectory of our recurring business.
See Note 9, “Debt Obligations,” to the consolidated financial statements for further discussion of our debt obligations. Contractual Obligations and Contingent Commitments Nasdaq has contractual obligations to make future payments under debt obligations by contract maturity, operating lease payments, and other obligations.
See Note 9, “Debt Obligations,” to the consolidated financial statements for further discussion of our debt obligations. 49 Contractual Obligations and Contingent Commitments Nasdaq has contractual obligations to make future payments under debt obligations by contract maturity, minimum rental commitments under non-cancelable operating leases and other obligations.
Repatriation of Cash Our cash and cash equivalents held outside of the U.S. in various foreign subsidiaries totaled $275 million as of December 31, 2022 and $266 million as of December 31, 2021. The remaining balance held in the U.S. totaled $227 million as of December 31, 2022 and $127 million as of December 31, 2021.
Repatriation of Cash Our cash and cash equivalents held outside of the U.S. in various foreign subsidiaries totaled $236 million as of December 31, 2023 and $275 million as of December 31, 2022. The remaining balance held in the U.S. totaled $217 million as of December 31, 2023 and $227 million as of December 31, 2022.
Interest rates on certain tranches of notes are subject to adjustment to the extent our debt rating is downgraded below investment grade, as further discussed in Note 9, “Debt Obligations,” to the consolidated financial statements.
Debt Obligations As of December 31, 2023, substantially all of our debt obligations were fixed-rate obligations. Interest rates on certain tranches of notes are subject to adjustment to the extent our debt rating is downgraded below investment grade, as further discussed in Note 9, “Debt Obligations,” to the consolidated financial statements.
See “ASR Agreement,” “Share Repurchase Program,” and “Cash Dividends on Common Stock,” of Note 12, “Nasdaq Stockholders’ Equity,” to the consolidated financial statements for further discussion of our ASR agreement, share repurchase program and cash dividends paid on our common stock. 50 Financial Investments Our financial investments totaled $181 million as of December 31, 2022 and $208 million as of December 31, 2021.
See “Share Repurchase Program,” and “Cash Dividends on Common Stock,” of Note 12, “Nasdaq Stockholders’ Equity,” to the consolidated financial statements for further discussion of our share repurchase program and cash dividends declared and paid on our common stock. Financial Investments Our financial investments totaled $188 million as of December 31, 2023 and $181 million as of December 31, 2022.
The financial statements of these subsidiaries are translated into U.S. dollars for consolidated reporting using a current rate of exchange, with net gains or losses recorded in accumulated other comprehensive loss within stockholders’ equity in the Consolidated Balance Sheets.
Substantially all of our foreign subsidiaries operate in functional currencies other than the U.S. dollar. The financial statements of these subsidiaries are translated into U.S. dollars for consolidated reporting using a current rate of exchange, with net gains or losses recorded in accumulated other comprehensive loss within stockholders’ equity in the Consolidated Balance Sheets.
Foreign Currency Exchange Rate Risk We are subject to foreign currency exchange rate risk. Our primary transactional exposure to foreign currency denominated revenues less transaction-based expenses and operating income for the years ended December 31, 2022 and 2021 are presented in the following tables: Euro Swedish Krona Other Foreign Currencies U.S.
Our primary transactional exposure to foreign currency denominated revenues less transaction-based expenses and operating income for the years ended December 31, 2023 and 2022 are presented in the following tables: Euro Swedish Krona Canadian Dollar Other Foreign Currencies U.S.
Nasdaq's Operating Results The following tables summarize our financial performance for the year ended December 31, 2022 when compared to the same period in 2021 and for the year ended December 31, 2021 when compared to the same period in 2020.
Nasdaq ’ s Operating Results The following tables summarize our financial performance for the year ended December 31, 2023 compared to the same period in 2022 and for the year ended December 31, 2022 when compared to the same period in 2021.
Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions, except per share amounts) Revenues less transaction-based expenses $ 3,582 $ 3,420 $ 2,903 4.7 % 17.8 % Operating expenses 2,018 1,979 1,669 2.0 % 18.6 % Operating income 1,564 1,441 1,234 8.5 % 16.8 % Net income attributable to Nasdaq $ 1,125 $ 1,187 $ 933 (5.2) % 27.2 % Diluted earnings per share $ 2.26 $ 2.35 $ 1.86 (3.8) % 26.3 % Cash dividends declared per common share $ 0.78 $ 0.70 $ 0.65 11.4 % 7.7 % In countries with currencies other than the U.S. dollar, revenues and expenses are translated using monthly average exchange rates.
Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions, except per share amounts) Revenues less transaction-based expenses $ 3,895 $ 3,582 $ 3,420 8.7 % 4.7 % Operating expenses 2,317 2,018 1,979 14.8 % 2.0 % Operating income 1,578 1,564 1,441 0.9 % 8.5 % Net income attributable to Nasdaq $ 1,059 $ 1,125 $ 1,187 (5.9) % (5.2) % Diluted earnings per share $ 2.08 $ 2.26 $ 2.35 (8.0) % (3.8) % Cash dividends declared per common share $ 0.86 $ 0.78 $ 0.70 10.3 % 11.4 % In countries with currencies other than the U.S. dollar, revenues and expenses are translated using monthly average exchange rates.
Cash Equity Trading Revenues The following tables present total revenues, transaction-based expenses, and total revenues less transaction-based expenses as well as key drivers and other metrics from our Cash Equity trading business: Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions) Cash Equity Trading Revenues $ 1,605 $ 1,578 $ 1,582 1.7 % (0.3) % Section 31 fees 436 229 586 90.4 % (60.9) % Transaction-based expenses: Transaction rebates (1,184) (1,118) (1,169) 5.9 % (4.4) % Section 31 fees (436) (229) (586) 90.4 % (60.9) % Brokerage and clearance fees (24) (31) (32) (22.6) % (3.1) % Cash equity trading revenues, net $ 397 $ 429 $ 381 (7.5) % 12.6 % See discussion in "U.S.
Cash Equity Trading Revenues The following tables present total revenues, transaction-based expenses, and total revenues less transaction-based expenses as well as key drivers and other metrics from our Cash Equity Trading business: Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions) Cash Equity Trading Revenues $ 1,355 $ 1,605 1,578 (15.6) % 1.7 % Section 31 fees 253 436 229 (42.0) % 90.4 % Transaction-based expenses: Transaction rebates (939) (1,184) (1,118) (20.7) % 5.9 % Section 31 fees (253) (436) (229) (42.0) % 90.4 % Brokerage and clearance fees (19) (24) (31) (20.8) % (22.6) % Cash equity trading revenues, net $ 397 $ 397 $ 429 — % (7.5) % See the discussion in "U.S.
U.S. equity derivative trading revenues less transaction-based expenses increased in 2022 compared with 2021 primarily due to higher capture rates and higher industry trading volumes, and lower transaction rebates, partially offset by lower overall matched market share executed on Nasdaq's exchanges.
Cash equity trading revenues less transaction-based expenses remained flat in 2023 compared with 2022 primarily due to lower industry trading volumes and lower overall U.S. matched market share executed on Nasdaq’s exchanges, partially offset by higher U.S. capture rate. Transaction rebates decreased in 2023 compared with 2022.
See Note 16, “Leases,” to the consolidated financial statements for further discussion of our leases. • Purchase obligations primarily represent minimum outstanding obligations due under software license agreements.
See Note 16, “Leases,” to the consolidated financial statements for further discussion of our leases. • Purchase obligations primarily represent minimum outstanding obligations due under software license agreements, of which the majority relates to our multi-year AWS partnership contract.
Tape plans and other revenues. The following tables present net revenues by product from our Trading Services business: Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions) U.S. Equity Derivative Trading $ 371 $ 343 $ 287 8.2 % 19.5 % Cash Equity Trading 397 429 381 (7.5) % 12.6 % U.S.
Tape plans and other revenues. The following tables present net revenues by product from our Market Services segment: Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions) U.S. Equity Derivative Trading $ 374 $ 371 $ 343 0.8 % 8.2 % Cash Equity Trading 397 397 429 — % (7.5) % U.S.
The ARR chart includes: ▪ Anti-Financial Crime support and SaaS subscription contracts ▪ Proprietary market data subscriptions and annual listing fees within our Data & Listing Services business, index data subscriptions and guaranteed minimum on futures contracts within our Index business and subscription contracts under our Workflow & Insights business. ▪ Market technology support and SaaS subscription contracts as well as trade management services contracts, excluding one-time service requests.
The ARR chart includes: ▪ Proprietary market data subscriptions and annual listing fees within our Data & Listing Services business, index data subscriptions and guaranteed minimum on futures contracts within our Index business and subscription contracts under our Workflow & Insights business. ▪ SaaS subscription and support contracts related to Verafin, surveillance, market technology, AxiomSL, Calypso and trade management services, excluding one-time service requests.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, which was previously filed with the SEC on February 23, 2022, with the exception of certain discussions impacted by the new corporate structure.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, which was previously filed with the SEC on February 23, 2023.
The comparability of our results of operations between reported periods is impacted by the acquisition of Verafin in February 2021. See “2021 Acquisition,” of Note 4, “Acquisitions and Divestiture,” to the consolidated financial statements for further discussion. For a detailed discussion of our results of operations, see “Segment Operating Results” below.
The comparability of our results of operations between reported periods is impacted by the acquisition of Adenza in November 2023. See “2023 Acquisition,” of Note 4, “Acquisitions,” to the consolidated financial statements for further discussion. For a detailed discussion of our results of operations, see “Segment Operating Results” below.
Dollar Total (in millions, except currency rate) Year Ended December 31, 2022 Average foreign currency rate to the U.S. dollar 1.054 0.099 # N/A N/A Percentage of revenues less transaction-based expenses 6.2 % 5.1 % 4.1 % 84.6 % 100.0 % Percentage of operating income 10.1 % (2.8) % (10.6) % 103.3 % 100.0 % Impact of a 10% adverse currency fluctuation on revenues less transaction-based expenses $ (22) $ (18) $ (15) $ — $ (55) Impact of a 10% adverse currency fluctuation on operating income $ (16) $ (4) $ (17) $ — $ (37) Euro Swedish Krona Other Foreign Currencies U.S.
Dollar Total (in millions, except currency rate) Year Ended December 31, 2022 Average foreign currency rate to the U.S. dollar 1.054 0.099 0.768 # N/A N/A Percentage of revenues less transaction-based expenses 6.2% 5.1% 0.9% 3.2% 84.6% 100.0% Percentage of operating income 10.1% (2.8)% (5.9)% (4.7)% 103.3% 100.0% Impact of a 10% adverse currency fluctuation on revenues less transaction-based expenses $(22) $(18) $(3) $(12) $— Impact of a 10% adverse currency fluctuation on operating income $(16) $(4) $(9) $(8) $— __________ # Represents multiple foreign currency rates.
As of December 31, 2022, other required regulatory capital of $10 million, primarily related to Nasdaq Central Securities Depository, was primarily invested in European government debt securities that are included in financial investments in the Consolidated Balance Sheets and cash, which is included in restricted cash and cash equivalents in the Consolidated Balance Sheets.
As of December 31, 2023, other required regulatory capital of $16 million, primarily related to Nasdaq Central Securities Depository, was primarily invested in European government debt securities that are included in financial investments in the Consolidated Balance Sheets.
The increase was also driven by a $28 million purchase price adjustment on Verafin deferred revenue in 2021 and the inclusion of a full year of Verafin revenues in 2022. The increase in 2021 compared with 2020 was due to the inclusion of revenues from our acquisition of Verafin and growth in our surveillance solutions.
The 2022 increase was also driven by a $28 million purchase price adjustment from the Verafin acquisition on deferred revenue in 2021 and the inclusion of a full year of Verafin revenues in 2022.
Net cash provided by operating activities is also impacted by the effects of changes in operating assets and liabilities such as: accounts receivable and deferred revenue which are impacted by the timing of customer billings and related collections from our customers; accounts payable and accrued expenses due to timing of payments; accrued personnel costs, which are impacted by employee performance targets and the timing of payments related to employee bonus incentives; and Section 31 fees payable to the SEC, which is impacted by the changes in SEC fee rates and the timing of collections from customers and payments to the SEC.
Changes in working capital include changes in accounts receivable and deferred revenue which are impacted by the timing of customer billings and related collections from our customers; accounts payable and accrued expenses due to timing of payments; accrued personnel costs, which are impacted by employee performance targets and the timing of payments related to employee bonus incentives; and Section 31 fees payable to the SEC, which is impacted by the changes in SEC fee rates and the timing of collections from customers and payments to the SEC.
The carrying value of goodwill was reassigned to our new reportable segments based on a relative fair value allocation approach. October 1, 2022 (in millions) Market Platforms $ 2,819 Capital Access Platforms 4,122 Anti-Financial Crime 1,005 $ 7,946 In 2022 and 2021, we elected to perform a quantitative impairment test for goodwill and indefinite-lived intangible assets.
The carrying value of goodwill was reassigned to our new reportable segments based on a relative fair value allocation approach. October 1, 2023 (in millions) Capital Access Platforms $ 4,138 Financial Technology 1,922 Market Services 1,928 $ 7,988 In 2023 and 2022, we elected to perform a quantitative impairment test for goodwill and indefinite-lived intangible assets.
Marketplace technology revenues increased in 2022 compared with 2021 and 2021 compared with 2020 primarily due to higher trade management services revenues associated with increased demand for connectivity services, partially offset by lower market technology revenues.
The increase in 2022 was primarily due to higher trade management services revenues associated with increased demand for connectivity services, partially offset by lower market technology revenues.
While changes in interest rates will have no impact on the interest we pay on fixed-rate obligations, we are exposed to changes in interest rates as a result of the borrowings under our 2022 Credit Facility, as this facility has a variable interest rate.
While changes in interest rates will have no impact on the interest we pay on fixed-rate obligations, we are exposed to changes in interest rates as a result of the borrowings under our 2022 Revolving Credit Facility, our commercial paper program and the 2023 Term Loan as these facilities have a variable interest rate.
If events occur and the payment of these amounts ultimately proves unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when we determine the liabilities are no longer necessary.
If events occur and the payment of these amounts ultimately proves unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when we determine the liabilities are no longer necessary. If our estimate of tax liabilities proves to be less than the ultimate assessment, a further charge to expense would result.
Index Revenues The following tables present key drivers from our Index business: As of or Three Months Ended December 31, 2022 2021 2020 Number of licensed ETPs 379 362 339 TTM change in period end ETP AUM tracking Nasdaq indexes (in billions) Beginning balance $ 424 $ 359 $ 233 Net (depreciation) appreciation (142) 83 80 Net impact of ETP sponsor switches (1) (92) — Net inflows 34 74 46 Ending balance $ 315 $ 424 $ 359 Quarterly average ETP AUM tracking Nasdaq indexes (in billions) $ 326 $ 400 $ 334 Quarterly annualized SaaS revenues (in millions) $ 220 $ 208 $ 179 In the table above, TTM represents trailing twelve months.
Index Revenues The following table presents key drivers from our Index business: As of or Three Months Ended December 31, 2023 2022 2021 Number of licensed ETPs 388 379 362 TTM change in period end ETP AUM tracking Nasdaq indices (in billions) Beginning balance $ 315 $ 424 $ 359 Net appreciation (depreciation) 128 (142) 83 Net impact of ETP sponsor switches (1) (1) (92) Net inflows 31 34 74 Ending balance $ 473 $ 315 $ 424 Quarterly average ETP AUM tracking Nasdaq indices (in billions) $ 436 $ 326 $ 400 ARR $ 72 $ 68 $ 67 In the table above, TTM represents trailing twelve months.
If market interest rates were to increase immediately and uniformly by a hypothetical 100 basis points from levels as of December 31, 2022, the fair value of this portfolio would decline by $3 million. Debt Obligations As of December 31, 2022, the majority of our debt obligations were fixed-rate obligations.
These securities are subject to interest rate risk and the fair value of these securities will decrease if market interest rates increase. If market interest rates were to increase immediately and uniformly by a hypothetical 100 basis points from levels as of December 31, 2023, the fair value of this portfolio would decline by $3 million.
In December 2022, Nasdaq amended and restated the 2020 Credit Facility with a new maturity date of December 16, 2027. In addition to the 2022 Credit Facility, we also have other credit facilities primarily to support our Nasdaq Clearing operations in Europe, as well as to provide a cash pool credit line for one subsidiary.
In addition to the 2022 Revolving Credit Facility, we also have other credit facilities primarily to support our Nasdaq Clearing operations in Europe, as well as to provide a cash pool credit line for one subsidiary.
We perform sensitivity analyses to determine the effects of market risk exposures. We may use derivative instruments solely to hedge financial risks related to our financial positions or risks that are incurred during the normal course of business. We do not use derivative instruments for speculative purposes.
We may use derivative instruments solely to hedge financial risks related to our financial positions or risks that are incurred during the normal course of business. We do not use derivative instruments for speculative purposes. Interest Rate Risk We are subject to the risk of fluctuating interest rates in the normal course of business.
Pass-through fees can increase or decrease due to rate changes by the SEC, our percentage of the overall industry volumes processed on our systems, and differences in actual dollar value traded. The SEC implemented a fee increase in May 2022 and a decrease in February 2021.
Pass-through fees can increase or decrease due to rate changes by the SEC, our percentage of the overall industry volumes processed on our systems, and differences in actual dollar value traded. Section 31 fees decreased in 2023 compared with 2022 primarily due to lower average SEC fee rates.
Equity Derivative Trading Revenues $ 1,252 $ 1,367 $ 1,122 (8.4) % 21.8 % Section 31 fees 89 32 69 178.1 % (53.6) % Transaction-based expenses: Transaction rebates (878) (1,018) (828) (13.8) % 22.9 % Section 31 fees (89) (32) (69) 178.1 % (53.6) % Brokerage and clearance fees (3) (6) (7) (50.0) % (14.3) % U.S.
Equity Derivative Trading Revenues $ 1,257 $ 1,252 $ 1,367 0.4 % (8.4) % Section 31 fees 55 89 32 (38.2) % 178.1 % Transaction-based expenses: Transaction rebates (879) (878) (1,018) 0.1 % (13.8) % Section 31 fees (55) (89) (32) (38.2) % 178.1 % Brokerage and clearance fees (4) (3) (6) 33.3 % (50.0) % U.S.
The following tables present revenue and key driver from our Other business: Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions) Other $ 102 $ 110 $ 102 (7.3) % 7.8 % In the table above, other includes transaction rebates of $30 million, $32 million and $31 million in 2022, 2021 and 2020 respectively.
The following tables present revenue and a key driver from our Other business: Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions) Other $ 75 $ 71 $ 78 5.6 % (9.0) % In the table above, other includes transaction rebates of $20 million, $30 million, and $32 million in 2023, 2022, and 2021 respectively.
We are also exposed to credit risk as a result of our normal business activities. We have implemented policies and procedures to measure, manage, monitor and report risk exposures, which are reviewed regularly by management and the board of directors. We identify risk exposures and monitor and manage such risks on a daily basis.
We have implemented policies and procedures to measure, manage, monitor and report risk exposures, which are reviewed regularly by management and the board of directors. We identify risk exposures and monitor and manage such risks on a daily basis. We perform sensitivity analyses to determine the effects of market risk exposures.
The following table summarizes our financial assets: December 31, 2022 December 31, 2021 (in millions) Cash and cash equivalents $ 502 $ 393 Financial investments 181 208 Total financial assets $ 683 $ 601 Cash and Cash Equivalents Cash and cash equivalents includes all non-restricted cash in banks and highly liquid investments with original maturities of 90 days or less at the time of purchase.
The following table summarizes selected measures of our liquidity and capital resources: December 31, 2023 December 31, 2022 (in millions) Cash and cash equivalents $ 453 $ 502 Financial investments 188 181 Working capital 71 (231) Cash and Cash Equivalents Cash and cash equivalents includes all non-restricted cash in banks and highly liquid investments with original maturities of 90 days or less at the time of purchase.
Since the amount recorded in revenues is equal to the amount recorded as Section 31 fees, there is no impact on our net revenues.
Equity Derivative Trading" for an explanation of Section 31 fees for 2023 as compared to 2022. Since the amount recorded in revenues is equal to the amount recorded as Section 31 fees, there is no impact on our net revenues.
Year Ended December 31, 2022 2021 2020 U.S. equity options Total industry average daily volume (in millions) 38.2 37.2 27.7 Nasdaq PHLX matched market share 11.6 % 12.4 % 12.7 % The Nasdaq Options Market matched market share 8.0 % 8.1 % 9.8 % Nasdaq BX Options matched market share 2.8 % 1.4 % 0.2 % Nasdaq ISE Options matched market share 5.7 % 6.6 % 7.8 % Nasdaq GEMX Options matched market share 2.3 % 4.3 % 5.6 % Nasdaq MRX Options matched market share 1.6 % 1.6 % 0.7 % Total matched market share executed on Nasdaq’s exchanges 32.0 % 34.4 % 36.8 % 41 U.S. equity derivative trading revenues decreased in 2022 compared with 2021 primarily due to lower overall matched market share executed on Nasdaq's exchanges and lower gross capture rate, partially offset by higher industry trading volumes.
Since the amount recorded in revenues is equal to the amount recorded as Section 31 fees, there is no impact on our net revenues. 41 Year Ended December 31, 2023 2022 2021 U.S. equity options Total industry average daily volume (in millions) 40.4 38.2 37.2 Nasdaq PHLX matched market share 11.3 % 11.6 % 12.4 % The Nasdaq Options Market matched market share 6.1 % 8.0 % 8.1 % Nasdaq BX Options matched market share 3.3 % 2.8 % 1.4 % Nasdaq ISE Options matched market share 5.9 % 5.7 % 6.6 % Nasdaq GEMX Options matched market share 2.4 % 2.3 % 4.3 % Nasdaq MRX Options matched market share 2.0 % 1.6 % 1.6 % Total matched market share executed on Nasdaq’s exchanges 31.0 % 32.0 % 34.4 % U.S. equity derivative trading revenues, transaction rebates, in which we credit a portion of the execution charge to the market participant, and U.S. equity derivative trading revenues less transaction-based expenses remained relatively flat in 2023 compared with 2022 primarily due to higher industry trading volumes, partially offset by lower overall matched market share executed on Nasdaq’s exchanges and lower gross capture rate.
Our four previous reportable segments, Market Services, Corporate Platforms, Investment Intelligence and Market Technology have been changed to align with our new corporate structure that includes three segments: Market Platforms, Capital Access Platforms and Anti-Financial Crime.
In November 2023, following the acquisition of Adenza, we refined our divisional structure. Our three previous reportable segments, Market Platforms, Capital Access Platforms and Anti-Financial Crime, have been changed to align with our new corporate structure that includes the following three segments: Capital Access Platforms, Financial Technology and Market Services.
We also performed the test under our current organization structure, which includes three reporting units: Market Platforms segment, Capital Access Platforms segment and Anti-Financial Crime segment.
For 2023, we performed the goodwill impairment test under our previous organizational structure which included three reporting units: Market Platforms, Capital Access Platforms and Anti-Financial Crime segments and under our current organization structure, which includes the following three reporting units: Capital Access Platforms, Financial Technology and Market Services segments.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of the financial condition and results of operations of Nasdaq should be read in conjunction with our consolidated financial statements and related notes included in this Form 10-K, as well as the discussion under “Item 1A.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of the financial condition and results of operations of Nasdaq refers to the year-over-year comparison for the fiscal years ended December 31, 2023 and December 31, 2022 and should be read in conjunction with our consolidated financial statements and related notes included in this Form 10-K, as well as the discussion under “Item 1A.
Our primary exposure to net assets in foreign currencies as of December 31, 2022 is presented in the following table: Net Assets Impact of a 10% Adverse Currency Fluctuation (in millions) Swedish Krona $ 2,941 $ 294 British Pound 155 15 Norwegian Krone 150 15 Canadian Dollar 107 11 Australian Dollar 99 10 Euro 53 5 In the table above, Swedish Krona includes goodwill of $2,153 million and intangible assets, net of $495 million.
Our primary exposure to net assets in foreign currencies as of December 31, 2023 is presented in the following table: Net Assets Impact of a 10% Adverse Currency Fluctuation (in millions) Swedish Krona $ 3,012 $ 301 Norwegian Krone 144 14 British Pound 140 14 Canadian Dollar 102 10 Australian Dollar 96 10 Euro 60 6 In the table above, Swedish Krona includes goodwill of $2,230 million and intangible assets, net of $498 million.
Financial Investments As of December 31, 2022, our investment portfolio was primarily comprised of highly rated European government debt securities, which pay a fixed rate of interest. These securities are subject to interest rate risk and the fair value of these securities will decrease if market interest rates increase.
Our exposure to market risk for changes in interest rates relates primarily to our financial investments and debt obligations, which are discussed below. Financial Investments As of December 31, 2023, our investment portfolio was primarily comprised of highly rated European government debt securities, which pay a fixed rate of interest.
Dollar Total (in millions, except currency rate) Year Ended December 31, 2021 Average foreign currency rate to the U.S. dollar 1.183 0.117 # N/A N/A Percentage of revenues less transaction-based expenses 7.1 % 6.2 % 4.9 % 81.8 % 100.0 % Percentage of operating income 10.4 % (4.6) % (9.1) % 103.3 % 100.0 % Impact of a 10% adverse currency fluctuation on revenues less transaction-based expenses $ (24) $ (21) $ (17) $ — $ (62) Impact of a 10% adverse currency fluctuation on operating income $ (15) $ (7) $ (13) $ — $ (35) ____________ # Represents multiple foreign currency rates.
Dollar Total (in millions, except currency rate) Year Ended December 31, 2023 Average foreign currency rate to the U.S. dollar 1.081 0.094 0.741 # N/A N/A Percentage of revenues less transaction-based expenses 6.6% 4.0% 0.8% 3.0% 85.6% 100.0% Percentage of operating income 10.7% (3.8)% (7.0)% (8.3)% 108.4% 100.0% Impact of a 10% adverse currency fluctuation on revenues less transaction-based expenses $(26) $(15) $(3) $(12) $— Impact of a 10% adverse currency fluctuation on operating income $(17) $(6) $(11) $(13) $— Euro Swedish Krona Canadian Dollar Other Foreign Currencies U.S.
Business Segments In September 2022, we announced a new organizational structure which aligns our businesses more closely with the foundational shifts that are driving the evolution of the global financial system. The new corporate structure includes three business segments: Market Platforms, Capital Access Platforms and Anti-Financial Crime. All prior periods have been restated to conform to the current period presentation.
Business Segments Our organizational structure aligns our businesses with the foundational shifts that are driving the evolution of the global financial system. Following the acquisition of Adenza, we further refined the divisional structure into Capital Access Platforms, Financial Technology and Market Services reportable segments. All prior periods have been restated to conform to the current period presentation.
Off-Balance Sheet Arrangements For discussion of off-balance sheet arrangements see: • Note 15, “Clearing Operations,” to the consolidated financial statements for further discussion of our non-cash default fund contributions and margin deposits received for clearing operations; and • Note 18, “Commitments, Contingencies and Guarantees,” to the consolidated financial statements for further discussion of: ◦ Guarantees issued and credit facilities available; ◦ Other guarantees; ◦ Routing brokerage activities; ◦ Legal and regulatory matters; and ◦ Tax audits. 52 Quantitative and Qualitative Disclosures About Market Risk As a result of our operating, investing and financing activities, we are exposed to market risks such as interest rate risk and foreign currency exchange rate risk.
Off-Balance Sheet Arrangements For discussion of off-balance sheet arrangements see: • Note 15, “Clearing Operations,” to the consolidated financial statements for further discussion of our non-cash default fund contributions and margin deposits received for clearing operations; and • Note 18, “Commitments, Contingencies and Guarantees,” to the consolidated financial statements for further discussion of: ◦ Guarantees issued and credit facilities available; ◦ Other guarantees; and ◦ Routing brokerage activities.
Interest expense increased in 2022 compared with 2021 primarily due to an increase in interest rates related to borrowings under our commercial paper program. The net gain on divestiture of business in 2021 relates to the sale of our U.S. Fixed Income business, which was part of our FICC business within our Market Services segment.
The net gain on divestiture of business in 2021 relates to the sale of our U.S. Fixed Income business, which was part of our FICC business within our Market Services segment.
These credit facilities, which are available in multiple currencies, totaled $184 million as of December 31, 2022 and $212 million as of December 31, 2021 in available liquidity, none of which was utilized. As of December 31, 2022, we were in compliance with the covenants of all of our debt obligations.
These European credit facilities, which are available in multiple currencies, totaled $191 million as of December 31, 2023 and $184 million as of December 31, 2022 in available liquidity, none of which was utilized.
A hypothetical 100 basis points increase in interest rates on our outstanding commercial paper would increase our annual interest expense by approximately $7 million based on borrowings as of December 31, 2022. We may utilize interest rate swap agreements to achieve a desired mix of variable and fixed rate debt.
A hypothetical 100 basis points increase in interest rates on our outstanding commercial paper and our 2023 Term Loan would increase our annual interest expense by approximately $6 million based on borrowings as of December 31, 2023.
Tape plans 149 155 162 (3.9) % (4.3) % Other 102 110 102 (7.3) % 7.8 % Trading Services, net $ 1,019 $ 1,037 $ 932 (1.7) % 11.3 % In the table above, Other includes Nordic fixed income trading & clearing, Nordic derivatives, Nordic commodities, and Canadian cash equities trading. U.S.
Tape plans 141 149 155 (5.4) % (3.9) % Other 75 71 78 5.6 % (9.0) % Total Market Services, net $ 987 $ 988 $ 1,005 (0.1) % (1.7) % In the table above, Other includes Nordic fixed income trading & clearing, Nordic derivatives and Canadian cash equities trading. U.S.
In 2019, we initiated the transition of certain technology platforms to advance our strategic opportunities as a technology and analytics provider and continue the realignment of certain business areas.
In October 2022, following our September 2022 announcement to realign our segments and leadership, we initiated a divisional alignment program with a focus on realizing the full potential of this structure. In 2019, we initiated the transition of certain technology platforms to advance our strategic opportunities as a technology and analytics provider and continue the realignment of certain business areas.
Percentage of Revenues Less Transaction-based Expenses by Segment for the: 39 40 MARKET PLATFORMS The following tables present revenues from our Market Platforms segment: Year Ended December 31, Percentage Change 2022 2021 2020 2022 vs. 2021 2021 vs. 2020 (in millions) Trading Services $ 3,663 $ 3,503 $ 3,654 4.6 % (4.1) % Marketplace Technology 562 545 525 3.1 % 3.8 % Total Market Platforms $ 4,225 $ 4,048 $ 4,179 4.4 % (3.1) % Transaction-based expenses: Transaction rebates (2,092) (2,168) (2,028) (3.5) % 6.9 % Brokerage, clearance and exchange fees (552) (298) (694) 85.2 % (57.1) % Total Market Platforms, net $ 1,581 $ 1,582 $ 1,457 (0.1) % 8.6 % Trading Services Our Trading Services business includes equity derivatives trading, cash equity trading, Nordic fixed income trading & clearing, U.S.
MARKET SERVICES The following table presents revenues from our Market Services segment: Year Ended December 31, Percentage Change 2023 2022 2021 2023 vs. 2022 2022 vs. 2021 (in millions) Market Services $ 3,156 $ 3,632 $ 3,471 (13.1) % 4.6 % Transaction-based expenses: Transaction rebates (1,838) (2,092) (2,168) (12.1) % (3.5) % Brokerage, clearance and exchange fees (331) (552) (298) (40.0) % 85.2 % Total Market Services, net $ 987 $ 988 $ 1,005 (0.1) % (1.7) % Our Market Services segment includes equity derivatives trading, cash equity trading, Nordic fixed income trading & clearing, U.S.

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