Data Drives Exchange Revenue Growth

GLOBAL 2016 EXCHANGE INDUSTRY REVENUE TOTALS A RECORD $28.3 BILLION: EXCHANGE MARKET DATA REVENUES SURGE 29.2% ACCORDING TO LATEST BURTON-TAYLOR REPORT

Intercontinental Exchange extends lead over CME Group with sharp growth in market data revenue; scale a critical differentiator as ICE, CME, Nasdaq, Deutsche Boerse and LSE Group all report revenue gains; global trading and clearing revenues increase 2.07%

London and New York, July 11, 2017 – Global exchange revenues totalled a record $28.3 billion in 2016, rising 6.83% as strong revenue gains in exchange market data businesses drove industry growth according to Burton-Taylor International Consulting’s (a division of TP ICAP’s Data & Analytics group) latest report published today. Industry revenues were driven by a 29.2% increase in exchange market data businesses, with the segment reporting record revenues of $5.4 billion in 2016.

Other key findings include:

• Intercontinental Exchange accounted for 15.9% of total industry revenues, with 2016 revenue reaching $4.5 billion, up 34.78% from 2015 primarily a result of an 127.1% surge in market data revenues.
•        CME Group remained the next largest exchange in 2016, accounting for 12.7% of total industry revenues, supported by an industry leading 9.1% growth in trading revenues.
• Deutsche Boerse was the largest exchange in the EMEA region accounting for 25.1% of the region’s revenues, followed by the LSE Group with 16.8% of the total.
• Hong Kong Exchange Group was the largest exchange in Asia with a market share of 15.8%, while Japan Stock Exchange was second with a share of 13.6%.
• The exchange industry continues to enjoy enviable operating margins, with our analysis indicating average operating margins of 51.63% in 2016. The Australian Stock Exchange generated the highest margin at 71.90% for calendar year 2016, followed by CME Group at 66.15%.

In terms of business segments, the report found:

•        Trading, Clearing and Settlement revenues remained the largest business segment, generating $18.1 billion in industry revenues and accounting for 63.4% of all exchange revenues.
• Market Data & Index revenues have surged in recent years, representing the second largest industry, accounting for 19.18% of total global exchange revenues. Exchange market data revenues have grown at a CAGR of 11.99% since 2011.
• Listing and issuer service revenues stagnated as the weak IPO environment resulted in a 1.29% increase in revenues to $2.3 billion. Deutsche Boerse and the Japan Exchange Group bucked the trend, reporting revenue increases of 7.75% and 6.98%, respectively.
• Market Technology and Access revenues totaled $1.5 billion in 2016, rebounding 4.97% after two years of revenue declines.  Nasdaq led the segment in terms of both total revenues and YoY growth, reporting an increase in revenues of 11.8% to $541 million.

“The global exchange industry continues to undergo a steady transformation, as exchanges evolve their models to diversify away from a dependency on transactional businesses.  The combination of weak trading volumes and emerging competition is forcing incumbent exchanges to dramatically expand their focus on new business segments,” says Andy Nybo, Director at Burton-Taylor.  “Market data and index businesses are the current target of these expansion efforts but exchanges are constantly searching for new opportunities to expand their offerings, especially as new competition threatens to erode existing operating margins and profitability.”

Free extracts from the report can be accessed by visiting: http://www.burton-taylor.com/research.html with the sample code EXCHANGE2017, or you can purchase the full 89 page Burton-Taylor Exchange Global Share & Segment Sizing 2017 - Key Competitors, Global Market Share 2017, Global Segment Sizing 2017, Global Market Trending 2012-16, Global Segment Trending 2012-16 report by visiting https://burton-taylor.com/exchangereport/ or by contacting orders@burton-taylor.com, +1 646 201-4152.

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About Burton-Taylor International Consulting (www.burton-taylor.com)

Burton-Taylor International Consulting, part of TP ICAP group, is the recognised leader in information industry market research, strategy and business consulting.  Burton-Taylor Exchange, Credit, Risk, Compliance, Media Intelligence, PR and Market Data share figures are seen as industry benchmark standard globally. Burton-Taylor clients command an estimated 80% share of global revenue in the Market Data space and include the world’s largest information companies and exchange groups, key government organisations and regulatory bodies on multiple continents, the largest advisory firms serving the industry and more than 30 of the most active private equity and investment companies around the world.

About TP ICAP (www.tpicap.com)

TP ICAP brings together buyers and sellers in global financial, energy and commodities markets. It is the world’s largest wholesale market intermediary, with a portfolio of businesses that provide broking services, data & analytics and market intelligence, trusted by clients around the world. We operate from offices in 31 countries, supporting award-winning brokers with market-leading technology. For further information see www.tpicap.com.