Cboe Global Markets Posts Strong Q3 Earnings, Derivatives Drive Growth

Ticker: CBOE · Form: 10-Q · Filed: 2025-10-31T00:00:00.000Z

Sentiment: bullish

Topics: Financial Performance, Derivatives Trading, Exchange Operator, Revenue Growth, Net Income Increase, Market Infrastructure, Options Trading

Related Tickers: CBOE, NDAQ, CME, ICE

TL;DR

**CBOE is crushing it, with derivatives revenue soaring and net income up 37% – buy the dip if you get one!**

AI Summary

Cboe Global Markets, Inc. reported a robust financial performance for the three and nine months ended September 30, 2025. Total revenues for the three months increased by 8.1% to $1,141.7 million from $1,055.7 million in the prior year, driven primarily by a significant 18.6% rise in Derivatives markets revenue to $564.6 million. Net income for the three months surged by 37.7% to $300.8 million, up from $218.5 million in the same period of 2024. For the nine months, total revenues grew 17.5% to $3,510.2 million from $2,986.9 million, with Derivatives markets revenue climbing 20.3% to $1,633.8 million. Net income for the nine months increased by 38.4% to $786.5 million from $568.4 million. Operating income for the three months ended September 30, 2025, was $370.3 million, a 20.5% increase from $307.4 million in 2024. The company's cash and cash equivalents significantly increased to $1,496.7 million at September 30, 2025, from $920.3 million at December 31, 2024. Key risks include potential loss of exclusive listing rights for certain index options and futures products, and increasing competition from foreign and domestic entities.

Why It Matters

Cboe's strong performance, particularly in its Derivatives markets, signals robust activity in options and futures trading, which can reflect broader market volatility and hedging demand. This growth is crucial for investors as it indicates Cboe's ability to capitalize on market dynamics and expand its core business, potentially leading to higher shareholder returns. For employees, continued growth could mean job security and opportunities. Customers benefit from Cboe's expanding product offerings and market liquidity. In a competitive landscape with other exchanges like CME Group and Nasdaq, Cboe's ability to grow revenue and net income by over 37% in Q3 2025 demonstrates its competitive edge and strategic effectiveness.

Risk Assessment

Risk Level: medium — The risk level is medium due to Cboe's reliance on exclusive listing rights for certain index options and futures products, as highlighted in the 'Forward-Looking Statements' section. The potential loss of these rights could significantly impact revenue. Additionally, the filing mentions 'increasing competition by foreign and domestic entities,' which could pressure Cboe's market share and profitability despite current strong performance.

Analyst Insight

Investors should consider Cboe's strong financial performance, particularly in derivatives, as a positive indicator. Given the significant increase in net income and cash, investors might look for continued share buybacks or dividend increases. Monitor competitive pressures and any regulatory changes regarding exclusive product listings.

Financial Highlights

debt To Equity
0.29
revenue
$1,141.7M
operating Margin
32.4%
total Assets
$9,068.6M
total Debt
$1,442.4M
net Income
$300.8M
eps
$2.85
gross Margin
60.3%
cash Position
$1,496.7M
revenue Growth
+8.1%

Revenue Breakdown

SegmentRevenueGrowth
Derivatives markets$564.6M+18.6%
Data Vantage$162.1M+11.3%
Cash and spot markets$415.0M-4.4%

Key Numbers

Key Players & Entities

FAQ

What were Cboe Global Markets' total revenues for the third quarter of 2025?

Cboe Global Markets reported total revenues of $1,141.7 million for the three months ended September 30, 2025, an 8.1% increase compared to $1,055.7 million in the same period of 2024.

How much did Cboe's net income increase in Q3 2025?

Net income for Cboe Global Markets increased by 37.7% to $300.8 million for the three months ended September 30, 2025, up from $218.5 million in the third quarter of 2024.

What was the primary driver of Cboe's revenue growth in the recent quarter?

The primary driver of Cboe's revenue growth was its Derivatives markets, which saw revenue increase by 18.6% to $564.6 million for the three months ended September 30, 2025, compared to $476.0 million in the prior year.

What are the key risks Cboe Global Markets faces according to the 10-Q filing?

Key risks include the potential loss of Cboe's right to exclusively list and trade certain index options and futures products, and increasing competition from both foreign and domestic entities, as detailed in the 'Forward-Looking Statements' section.

What was Cboe Global Markets' cash and cash equivalents balance at September 30, 2025?

As of September 30, 2025, Cboe Global Markets had cash and cash equivalents totaling $1,496.7 million, a significant increase from $920.3 million at December 31, 2024.

How did Cboe's operating income perform in the third quarter of 2025?

Cboe Global Markets' operating income for the three months ended September 30, 2025, was $370.3 million, representing a 20.5% increase from $307.4 million in the same period of 2024.

What is Cboe's strategy for managing global operations and growth?

The filing indicates Cboe's ability to manage its global operations, growth, and strategic acquisitions or alliances effectively is a factor that could impact results, suggesting an ongoing focus on these areas to drive performance.

What is the diluted earnings per share for Cboe Global Markets for Q3 2025?

Cboe Global Markets reported diluted earnings per share of $2.85 for the three months ended September 30, 2025, an increase from $2.07 in the corresponding period of 2024.

How does Cboe protect its systems and networks from security vulnerabilities?

The company acknowledges 'our ability to protect our systems and communication networks from security vulnerabilities and breaches' as a factor that could cause actual results to differ, indicating this is a continuous area of focus and risk management.

What impact do royalty fees have on Cboe's cost of revenues?

Royalty fees and other cost of revenues amounted to $62.9 million for the three months ended September 30, 2025, contributing to the total cost of revenues of $536.2 million for the period.

Risk Factors

Industry Context

Cboe operates in the highly competitive exchange and trading services industry. Key trends include increasing demand for data analytics, the growth of derivatives trading, and ongoing technological advancements. The industry is characterized by significant barriers to entry due to regulatory requirements and established infrastructure.

Regulatory Implications

Cboe is subject to extensive regulation by bodies like the SEC. Changes in trading rules, data reporting requirements, or market structure regulations can significantly impact operations and profitability. Maintaining compliance is a continuous and critical aspect of the business.

What Investors Should Do

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Key Dates

Glossary

Derivatives markets
Markets where financial contracts (like options and futures) derive their value from an underlying asset, index, or rate. (A key revenue driver for Cboe, showing significant growth in this period.)
Liquidity payments
Payments made to market participants to encourage trading activity and provide liquidity on the exchange. (A significant cost of revenue, impacting net income.)
Goodwill
An intangible asset that arises when a company acquires another company for a price greater than the fair value of its net identifiable assets. (Represents a substantial portion of Cboe's assets, reflecting past acquisitions.)
Accumulated other comprehensive income (loss)
Includes unrealized gains and losses on investments, foreign currency translation adjustments, and other items not included in net income. (Shows a positive swing from a loss to a gain, impacting total stockholders' equity.)

Year-Over-Year Comparison

Cboe Global Markets, Inc. demonstrates robust year-over-year growth, with total revenues up 8.1% to $1,141.7 million in Q3 2025 and net income surging 37.7% to $300.8 million. This performance is largely fueled by an 18.6% increase in Derivatives markets revenue. The company's balance sheet shows a significant strengthening of its cash position, up from $920.3 million at year-end 2024 to $1,496.7 million. New risks identified include potential loss of exclusive listing rights and ongoing competitive pressures, while previously noted risks related to regulatory changes and operational disruptions remain relevant.

Filing Stats: 4,858 words · 19 min read · ~16 pages · Grade level 6.9 · Accepted 2025-10-31 08:16:51

Key Financial Figures

Filing Documents

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION 7 Item 1.

Financial Statements (unaudited)

Financial Statements (unaudited) 7 Condensed Consolidated Balance Sheets—As of September 30, 2025 and December 31, 2024 7 Condensed Consolidated Statements of Income—Three a nd N ine Mo nths Ended S eptember 30, 2025 and 2024 8 Condensed Consolidated Statements of Comprehensive Income—Three and N ine Months Ended S eptember 30, 2025 and 2024 9 Condensed Consolidated Statements of Changes in Stockholders' Equity—Three and N ine Months Ended S eptember 30, 2025 and 2024 10 Condensed Consolidated Statements of Cash Flows— N ine Months Ended S eptember 30, 2025 and 2024 12 Notes to Condensed Consolidated Financial Statements 13 Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 48 Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 82 Item 4.

Controls and Procedures

Controls and Procedures 85

OTHER INFORMATION

PART II. OTHER INFORMATION 86 Item 1.

Legal Proceedings

Legal Proceedings 86 Item 1A.

Risk Factors

Risk Factors 86 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 87 Item 3. Defaults upon Senior Securities 87 Item 4. Mine Safety Disclosures 87 Item 5. Other Information 88 Item 6. Exhibits 89

SIGNATURES

SIGNATURES 90 2 Table of Contents CERTAIN DEFINED TERMS Throughout this document, unless otherwise specified or the context so requires: "Cboe," "we," "us," "our" or "the Company" refers to Cboe Global Markets, Inc. and its subsidiaries. "ADV" means average daily volume. "ADNV" means average daily notional value. "AFM" refers to the Netherlands Authority for the Financial Markets. "ATS" refers to an alternative trading system. "Bats Global Markets" and "Bats" refer to our wholly-owned subsidiary Bats Global Markets, Inc., now known as Cboe Bats, LLC, and its subsidiaries. "BIDS Trading" refers to BIDS Trading L.P., a wholly-owned subsidiary of Cboe Global Markets, Inc. The ATS operated by BIDS Trading is not a registered national securities exchange or a facility thereof. "BYX" refers to Cboe BYX Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc. "BZX" refers to Cboe BZX Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc. "C2" refers to Cboe C2 Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc. "Cboe Asia Pacific" refers to Cboe Asia Pacific Holdings Limited (formerly known as Chi-X Asia Pacific Holdings Limited), a wholly-owned subsidiary of Cboe Global Markets, Inc. "Cboe Australia" refers to Cboe Australia Pty Ltd. (formerly known as Chi-X Australia Pty. Ltd.), a wholly-owned subsidiary of Cboe Global Markets, Inc. "Cboe Canada" refers to Cboe Canada Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc. and a recognized Canadian securities exchange. "Cboe Chi-X Europe" refers to Cboe Chi-X Europe Limited, a wholly-owned subsidiary of Cboe Global Markets, Inc. "Cboe Clear Europe" refers to Cboe Clear Europe N.V., a wholly-owned subsidiary of Cboe Global Markets, Inc. "Cboe Clear U.S." refers to Cboe Clear U.S., LLC (formerly known as Cboe Clear Digital, LLC, formerly defined as "Cboe Clear Digital"), a wholly-owned subsidiary of Cboe Global Markets, Inc. "Cboe Data Vantage"

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties. You can identify these statements by forward-looking words such as "may," "might," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," and the negative of these terms and other comparable terminology. All statements that reflect our expectations, assumptions or projections about the future other than statements of historical fact are forward-looking statements, including statements in "Management's Discussion and Analysis of Financial Condition and Results of Operations." These forward-looking statements, which are subject to known and unknown risks, uncertainties, and assumptions about us, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance, or achievements to differ materially from those expressed or implied by the forward-looking statements. In particular, you should consider the risks and uncertainties described under "Risk Factors" in this Quarterly Report and other filings with the SEC. While we believe we have identified material risks, these risks and uncertainties are not exhaustive. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Some factors

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements. Cboe Global Markets, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (unaudited) (in millions, except par value data and share amounts ) September 30, 2025 December 31, 2024 Assets Current assets: Cash and cash equivalents $ 1,496.7 $ 920.3 Financial investments 34.2 110.3 Accounts receivable, net of $ 6.6 allowance for credit losses at September 30, 2025 and $ 6.6 at December 31, 2024 437.3 444.6 Margin deposits, clearing funds, and interoperability funds 1,640.8 845.5 Income taxes receivable 33.7 73.8 Other current assets (includes restricted cash of $ 32.5 at September 30, 2025 and $ — at December 31, 2024) 99.3 84.6 Total current assets 3,742.0 2,479.1 Investments 430.2 383.7 Property and equipment, net 126.1 118.0 Operating lease right of use assets 116.1 124.5 Goodwill 3,146.9 3,124.2 Intangible assets, net 1,330.3 1,376.9 Other assets, net 177.0 182.7 Total assets $ 9,068.6 $ 7,789.1 Liabilities and Stockholders' Equity Current liabilities: Accounts payable and accrued liabilities $ 517.7 $ 359.7 Section 31 fees payable 0.2 182.0 Deferred revenue 6.8 6.4 Margin deposits, clearing funds, and interoperability funds 1,640.8 845.5 Income taxes payable 13.2 1.6 Total current liabilities 2,178.7 1,395.2 Long-term debt 1,442.4 1,441.0 Non-current unrecognized tax benefits 235.2 305.0 Deferred income taxes 162.0 186.8 Non-current operating lease liabilities 127.2 138.4 Other non-current liabilities 38.2 43.1 Total liabilities 4,183.7 3,509.5 Commitments and contingencies Stockholders' equity: Preferred stock, $ 0.01 par value: 20,000,000 shares authorized, no shares issued and outstanding at September 30, 2025 and December 31, 2024 — — Common stock, $ 0.01 par value: 325,000,000 shares authorized, 105,078,576 and 104,636,261 shares issued and outstanding, respectively at September 30, 2025 and 104,693,373 and 104,686,478 shares issued and outstanding, respectively at December 31,

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