(Reuters) - NYSE-owner Intercontinental Exchange Inc (ICE.N) reported a better-than-expected quarterly profit on Thursday, driven by strength in its market data services and clearing business, and said it would buy back up to $1.2 billion in shares.
Market data services include publication of daily indexes, historical price data, mobile access to ICE’s trading platform and end-of-day settlements.
Revenue from the unit rose 6 percent to $518 million. Trading and clearing revenue, excluding transaction-based expenses, was up 8 percent to $523 million, helped by higher futures and energy volumes.
U.S. exchanges have been buying new products and companies to diversify their revenue stream and insulate themselves from swings in market volatility that affects trading and clearing revenue.
ICE bought NGX and Shoran Energy Brokers from TMX Group to boost its energy trading business, while rival Nasdaq Inc (NDAQ.O) acquired investment analytics provider eVestment Alliance LLC for $705 million.
Net income attributable to ICE rose 7 percent to $369 million in the third quarter ended Sept. 30. (reut.rs/2z8gIqI)
Excluding items, ICE earned 73 cents per share, beating analysts’ average estimate of 70 cents, according to Thomson Reuters I/B/E/S.
Revenue rose 1 percent to $1.43 billion.
Total operating expenses fell 9.4 percent to $547 million.
The company said it expects operating expenses between $540 million and $550 million in the current quarter.
ICE is "now on track to exceed our original 2017 synergy target even as we invest for continued growth in 2018," Chief Financial Officer Scott Hill said. (bit.ly/2h4kque)
Reporting By Aparajita Saxena in Bengaluru; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila