ICE's second quarter 2026 earnings release and presentation can be found in the investor section of ice.com. You will find a reconciliation to the equivalent GAAP term in the earnings materials. When used on this call, net revenue refers to revenue, net of transaction-based expenses, and adjusted earnings refers to adjusted diluted earnings per share. Throughout this presentation, unless otherwise indicated, references to revenue growth on a constant currency basis.
Please see the explanatory notes on the second page of the earnings supplement for additional details regarding the definition of certain items. Investors and stockholders should review the proxy statement and any other documents MarketAxess may file with the SEC in connection with the acquisition. Our acquisition of MarketAxess will continue this strategy within one of the largest markets in the world. Having built strong distribution in the retail and wealth channel, we now see a clear opportunity to extend our reach into the institutional investor segment, where MarketAxess has a leading presence.
Connecting these two pools should dramatically increase the probability that a buyer finds a seller, this price discovery will benefit every market participant. The offer price represents a 33% premium to MarketAxess' closing price as of July 29th, and on a fully synergized basis, the transaction represents an EV to adjusted EBITDA multiple of approximately 10.6x. We anticipate the transaction will be immediately accretive to ICE's adjusted earnings per share in the first year post-close, with accretion improving as synergies are realized and the combined platform scales. The transaction value we've announced and intend to underwrite is supported by MarketAxess' recent mid-single-digit growth trajectory.
What went well
- Second quarter adjusted EPS of $1.90 was a second-quarter record and the second-best quarter in ICE's history, on net revenues of $2.7 billion (up 5%) and adjusted operating income of $1.6 billion.
- Recurring revenues reached a record $1.4 billion (up 8%), demonstrating the durability of the platform even as episodic trading volatility moderated from the first quarter.
- ICE announced a definitive agreement to acquire MarketAxess for $167 per share (a 33% premium, $5.7 billion enterprise value), which it expects to be immediately accretive to adjusted EPS in year one, with about $100 million of annualized expense synergies.
- Management said the MarketAxess deal would be financed in cash and that leverage would peak temporarily near 3.4x before returning to 3x or below within 18-24 months, consistent with prior debt-financed transactions.
- The board authorized up to $4 billion of share repurchases, and management said it expects to raise baseline quarterly buybacks from the prior $350-$400 million range while continuing to grow the dividend.
What went wrong
- Net revenue growth decelerated to 5% (from 18% in the first quarter) as episodic trading volatility moderated.
- Adjusted operating expenses of $1.038 billion rose year-over-year on performance-related compensation, accelerated data-center investment, and incremental depreciation and amortization from product development in FIDS and mortgage technology.
- Management raised full-year 2026 adjusted operating expense guidance to $4.190-$4.230 billion and guided third quarter opex up to $1.063-$1.073 billion.
- The pending MarketAxess acquisition will temporarily push gross leverage to about 3.4x and is not expected to close until the first half of 2027, subject to regulatory approvals.
More on Intercontinental Exchange, Inc.
Reported 2026-07-30 · figures from the Intercontinental Exchange, Inc. Q2 2026 earnings call.