Cboe Global Markets, Inc.

What they do

Cboe operates the largest U.S. options exchange and the third-largest U.S. equities exchange operator, along with European equities exchanges, a pan-European clearinghouse, and a U.S. block-trading ATS. The company also runs futures and global FX businesses and provides market data, index licensing, and ETP listings. It is divesting certain non-core assets (Cboe Australia, Cboe Canada) and winding down CEDX and its Japan equities business.

Revenue drivers

• Options — Largest segment; includes index options (e.g., S&P 500 options) and multi-listed equity/ETP options on Cboe Options, C2, BZX, and EDGX. Generates revenue from transaction fees, market data, and index licensing. Set a quarterly record in Q2 2026 with 30% net revenue growth.
• North American Equities — U.S. and Canadian equities/ETP transaction services on BZX, BYX, EDGX, EDGA, BIDS Trading, and Cboe Canada; also includes ETP listings on BZX and market data fees. Net revenue grew 22% in Q2 2026 (reported as Cash and Spot Markets combined).
• Europe and Asia Pacific — Pan-European equities and derivatives trading (Cboe Europe, Cboe NL), ETP listings, and clearing via Cboe Clear Europe. Also includes Australia and Canada operations, which are being sold to TMX. Segment undergoing strategic wind-downs and divestitures.
• Futures and Global FX — Futures segment includes Cboe Futures Exchange and VIX futures; Global FX includes Cboe FX Markets. These are smaller segments but contribute to diversified revenue mix. Combined with Data Vantage (market data and analytics), they support growth targets.

Recent performance

Q2 2026 total revenue less cost of revenues was $731.6 million, up 25% year-over-year; diluted EPS was $3.35 (up 50%), adjusted diluted EPS $3.56 (up 45%). Quarterly revenue trend: $1.14B (Q3 2025), $1.20B (Q4 2025), $1.27B (Q1 2026), $1.44B (Q2 2026). Full-year 2025 revenue was $4.71B with net income of $1.10B and diluted EPS of $10.42. Operating cash flow for 2025 was $1.75B.

Strategy

Cboe is executing a strategic realignment announced in 2025, focusing on core derivatives and cash/spot markets. This includes wind-downs of Japan equities and CEDX, sale of Cboe Australia and Canada to TMX for ~$300M, and discontinuing U.S./European corporate listings. The company is investing in growth areas: event contracts (Cboe Predicts), Cboe Clear U.S., and around-the-clock trading, while optimizing resource allocation by end of 2026.

Risks

• Loss of exclusive index products — If Cboe loses its exclusive right to list/trade certain index options and futures (e.g., S&P 500, VIX), revenue from high-margin index products could decline.
• Market and volume dependence — Revenues are sensitive to trading volumes, which can drop due to economic or market conditions, impacting transaction fees and market data revenue.
• Regulatory and compliance burden — Subject to extensive U.S. and international regulations (SEC, CFTC, ESMA, FCA, etc.); changes or enforcement could increase costs or limit operations.
• Operational and cyber risks — Systems must handle high volume without failure; security breaches or outages could disrupt trading and lead to financial or reputational damage.

Outlook

Management raised 2026 organic total net revenue growth target to 'mid to high teens' from 'low double-digit to mid teens' and Data Vantage growth to 'low teens'. Reaffirmed 2026 adjusted operating expense guidance of $838-$853 million, with a $11 million reduction due to Cboe Australia sale. Expects Cboe Australia sale to close in Q3 2026 and Cboe Canada later, with transition services support.