Nasdaq Q2 2025 slides: Revenue up 13%, EPS surges 24% on record Index AUM

Nasdaq Inc. (NDAQ) reported strong Q2 2025 results, with net revenue up 13% year-over-year to $1.31 billion and non-GAAP diluted EPS rising 24% to $0.85, driving a 0.82% premarket stock increase. The company saw double-digit growth across all major segments, including record Market Services revenue and a record $745 billion in Index ETP assets under management, underscoring the strength of its diversified business model and recurring revenue streams. This robust performance, marked by expanding operating margins and strategic deleveraging efforts, positions Nasdaq for continued organic growth.

Analysis

Nasdaq Inc. (NDAQ) delivered a robust financial performance in Q2 2025, underscoring the strength of its diversified business model. The company reported a 13% year-over-year increase in net revenue to $1.31 billion and a significant 24% jump in non-GAAP diluted EPS to $0.85, beating previous expectations. This growth was broad-based, with all major segments posting double-digit revenue increases. A key highlight is the continued shift toward more predictable, high-margin revenue streams; Annualized Recurring Revenue (ARR) grew 10% to $2.93 billion, with the faster-growing SaaS component now representing 37.5% of total ARR at $1.1 billion. The Market Services segment was a standout performer, achieving record net revenue of $306 million, a 22% increase, and expanding its operating margin by 5 percentage points to 63%. The Capital Access Platforms segment reinforced its market leadership with a record $745 billion in Index ETP assets and an 81% win rate for U.S. IPOs. Strategically, Nasdaq is executing on its deleveraging plan, reducing gross leverage to 3.2x, while management's commentary signals a clear focus on organic growth, suggesting a disciplined approach to capital allocation.

Key Decisions for Investors

• Investors should recognize Nasdaq's successful transformation into a high-quality growth company, driven by its expanding and profitable Solutions and Financial Technology segments, rather than viewing it solely as a cyclical market services provider.
• The sustained 13% growth in Annualized SaaS revenue is a critical metric to monitor, as continued momentum here supports the thesis for long-term margin expansion and justifies a premium valuation.
• Given the stock is trading near its 52-week high of $90.84, investors should weigh the strong fundamental performance and positive outlook against the current valuation before initiating or adding to positions.
• The stated focus on organic growth and deleveraging should be seen as a positive for risk-averse investors, as it reduces the uncertainty of large-scale M&A and strengthens the company's financial foundation for consistent shareholder returns.