Cboe Global Markets, Inc. (CBOE) Earnings & Analysis

Latest quarter

Cboe reported Q2 FY2026 revenue of $1.4 billion, up 22.9% from Q2 FY2025, while revenue as the consensus counts it was $731.6 million against a $716.6 million consensus estimate. The company reported adjusted EPS, as the consensus counts it, of $3.56, above the $3.45 consensus estimate; diluted EPS was $3.35, up 50.2% from a year earlier.

The filing attributed the year-over-year revenue increase primarily to higher transaction and clearing fees from increased trading volumes on its options, U.S. equities and European equities exchanges, alongside a higher Section 31 fee rate. The filing also reported growth in cash and spot markets, Data Vantage and derivatives markets revenue. Cboe reported a gross margin of 50.7%, compared with 50.0% a year earlier, and an operating margin of 33.0%, compared with 28.9%. Free cash flow was −$536.3 million, compared with $313.9 million in Q2 FY2025.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Chief Executive Officer Craig Donohue said Q2 net revenue rose 25% to $732 million and that every major category and all five company segments delivered year-over-year net revenue growth. He said derivatives net revenue rose 30%, led by index-options activity, with index-options average daily volume increasing 32% to 6.2 million contracts. Donohue attributed higher SPX options volumes in part to economic uncertainty, retail engagement and activity following the repeal of the Pattern Day Trader Rule.

Donohue said cash and spot markets net revenue rose 22%, with Global FX, Europe and Asia Pacific, and North American equities contributing. He also said Data Vantage net revenue increased 15%, with double-digit growth in market data and access services, global indices, and risk and market analytics. Chief Financial Officer Jill Griebenow said adjusted operating expenses were $217 million, up 2% year over year, while adjusted operating EBITDA margin expanded 6.4 percentage points to 72.2%.

On investment priorities, Donohue said Cboe was investing in global clearing and building event- and prediction-market products, while planning to expand cash-equities trading to a 23-by-5 schedule in December, pending industry readiness. Griebenow said the higher capital-expenditure outlook reflected investment in clearing infrastructure and hardware purchases brought forward to secure costs.

Analysts pressed management on event-prediction products, including their demand, pricing and potential financial contribution. Global Head of Derivatives Rob Hawking said the company viewed the products as an extension of its derivatives business and was encouraged by early engagement in its binary-options product. Hawking said pricing was still being evaluated, while Cboe expected its contracts to be competitive with other event-prediction products. Griebenow said the updated 2026 revenue outlook did not incorporate anything notable from those initiatives because they remained in their early stages.

Guidance

Cboe raised its FY2026 organic total net revenue growth outlook to the mid to high teens range from low double-digit to mid-teens guidance. The company raised its FY2026 Data Vantage organic net revenue growth outlook to the low teens range from low double-digit guidance. Cboe increased FY2026 capital-expenditure guidance to $98.0 million–$108.0 million from $73 to $83 million.