NYSE-parent ICE tops profit views as market volatility spurs trading

INTERCONTINENTAL Exchange (ICE) on Thursday (May 4) reported first-quarter profit slightly above Wall Street views, as market volatility boosted the New York Stock Exchange (NYSE) parent’s exchange unit, helping offset a rates-driven slump in its mortgage technology business.

Investors have been overhauling their portfolios to hedge against risk after a slew of interest rate hikes by the US Federal Reserve and the recent banking crisis that has roiled markets.

Revenue from ICE’s exchanges segment, its biggest business, grew 1 per cent from a year earlier to a record US$1.09 billion, while the company’s fixed income and data services segment revenue rose 11 per cent to a record US$563 million.

However, a sharp rise in interest rates have quelled demand for mortgages, hurting ICE’s mortgage technology unit, which helps businesses originate, review and process mortgages.

Revenue from the segment dipped 23 per cent to US$236 million.

On an adjusted basis, the exchange operator reported a profit of US$1.41 per share for the quarter ended Mar 31, which was a penny above the mean estimate of analysts, according to Refinitiv data.

The main driver of the profit beat was lower-than-expected expenses, Jefferies analyst Daniel Fannon said in a client note.

ICE’s total revenue, excluding transaction-based expenses, was US$1.9 billion, down 0.2 per cent from a year ago. REUTERS