Earnings Updates | Q3 2023

December 20, 2023by Anton Tryhubchenko

The corporate reporting period for Q3 2023 is coming to an end. During the third fiscal quarter, 5 companies outperformed analysts’ revenue expectations by more than 25%.

Cboe Global Markets has beaten the forecasts the most. Its quarterly revenue amounted to $908M, which is 89% more than the market expected ($479M). Let’s analyze the company’s business in more detail.

Cboe Global Markets is the largest options exchange in the United States, which provides access to trading options on more than 2K companies, calculates 22 stock indices, and manages 140 exchange-traded funds (ETFs).

Cboe Global Markets’ transaction volume increased in Q3 amid growing uncertainty in the macroeconomic and geopolitical environment. High volatility in global markets across all asset classes contributed to the growth in demand for the company’s options products as investors and traders seek risk management opportunities. CBOE’s average daily options volume grew by +8% and revenue per contract increased by +12%. Trading volumes for S&P 500 options increased by +21% and for the VIX volatility index by +60%. The exchange’s client base also grew, resulting in a +9% increase in revenue in the data services segment.

The company generates 57% of its revenue from derivatives, 37% from spot market operations, and 20% from data processing services. Manufacturing costs account for 48% of the revenue structure, and gross revenue for 52%. Over the past quarter, the company made a profit of $208M. And its market capitalization is now $19B.

After the report was published, Cboe shares increased by +4.1% to reach $169/share. Market participants are satisfied with the company’s current financial results and also have positive expectations for the next quarter..

*surprise – % ratio between actual and expected revenue
**growth – % ratio of the amount of revenue for the last 4 quarters compared to this value calculated for the previous quarter

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