Teleconferência de Resultados do 3T26 da Nasdaq (NDAQ): Receita, ARR de Fintech e Crescimento em IA

Principais Destaques

• A Nasdaq registrou receita líquida de US$ 1,5 bilhão no terceiro trimestre de 2026, uma alta de 14% na comparação anual. A receita de Soluções subiu 18%, atingindo US$ 1,2 bilhão, enquanto a receita recorrente anualizada aumentou 14%, alcançando US$ 3,4 bilhões.
• O lucro líquido atingiu US$ 588 milhões e o LPA diluído aumentou 19%, para US$ 1,04. A margem operacional foi de 57% e a margem EBITDA foi de 60%, ambas com alta de 1 ponto percentual.
• A receita de Tecnologia Financeira cresceu 16%, para US$ 529 milhões, com um crescimento recorde da ARR de 18%. As soluções em nuvem representaram 85% das contratações de fintech.
• A receita das Plataformas de Acesso ao Capital subiu 20%, atingindo US$ 641 milhões. A receita de Índices aumentou 39%, impulsionada por um recorde de ativos sob gestão médios em ETPs acima de US$ 1,1 trilhão e entradas líquidas de US$ 141 bilhões nos últimos 12 meses.
• A Nasdaq elevou sua projeção de despesas não GAAP para 2026 para US$ 2,550 bilhões–US$ 2,580 bilhões, refletindo aquisições recentes e o forte desempenho da receita no ano até o momento. A perspectiva para a taxa de imposto não GAAP permaneceu entre 22,5% e 24,5%.
• A administração identificou IA, migração para a nuvem, tokenização e mercados de funcionamento contínuo (always-on) como os principais vetores de demanda. A Nasdaq planeja lançar seu token de ações no primeiro semestre de 2027.

Principais Dados Financeiros

A administração atribuiu 10,5 pontos percentuais do crescimento da receita líquida a novos clientes, clientes existentes e inovação de produtos. Fatores relacionados ao mercado contribuíram com outros 3,5 pontos percentuais, incluindo avaliações mais altas dos índices da Nasdaq e maiores volumes de derivativos e opções.

Desempenho Comercial e Operacional

Plataformas de Acesso ao Capital

A receita aumentou 20%, atingindo US$ 641 milhões, enquanto a ARR cresceu 8%. A margem operacional da divisão expandiu 3 pontos percentuais, para 64%.

A Nasdaq recebeu 15 novas listagens de empresas operacionais que captaram US$ 32 bilhões, incluindo oito dos 10 maiores IPOs do trimestre. Sua taxa de atração (win rate) trimestral foi de 79%. No ano até o momento, a Nasdaq registrou 56 novas listagens de empresas operacionais que captaram US$ 144 bilhões, com uma taxa de atração de 74%.

O segmento de índices gerou US$ 49 bilhões em entradas líquidas durante o trimestre e um recorde de US$ 141 bilhões nos últimos 12 meses. A Nasdaq lançou 32 produtos de índices no 3T, elevando o total no ano para 97. Metade dos lançamentos do trimestre ocorreu fora dos Estados Unidos, enquanto os produtos introduzidos nos últimos cinco anos geraram 35% das entradas líquidas dos últimos 12 meses.

A receita de Workflow & Insights cresceu 5% e a ARR subiu 6%. eVestment e Data Link registraram, cada uma, crescimento de receita de dois dígitos. Os casos de uso relacionados à IA responderam por 25% das contratações do eVestment no ano até o momento, e o eVestment expandiu sua cobertura para mais de 95.000 fundos privados, uma alta de 19% em relação ao final de 2025.

Tecnologia Financeira

A receita aumentou 16%, alcançando US$ 529 milhões, com crescimento da ARR de 18%. A divisão conquistou 54 novos clientes, 135 vendas adicionais (upsells) e cinco vendas cruzadas (cross-sells). Sua margem operacional subiu 1 ponto percentual, para 46%.

A receita de Tecnologia de Gestão de Crimes Financeiros cresceu 23%, a ARR aumentou 19% e a retenção líquida de receita foi de 111%. A Nasdaq Verafin conquistou 45 novos clientes de pequeno e médio porte e três contratos corporativos (enterprise). Mais de 850 clientes estavam usando sua força de trabalho de IA agêntica, enquanto mais de 70 clientes haviam assinado contratos pagos por essas funcionalidades.

A receita de Tecnologia Regulatória cresceu 13% e a ARR aumentou 15%. A receita de Tecnologia para Mercados de Capitais subiu 14%, com alta de 19% na ARR. Os fatores de crescimento incluíram precificação em serviços de gestão de negociação, demanda por data centers, atividade elevada de testes, modernização de infraestrutura e execução contínua na Calypso.

A Nasdaq também expandiu a Calypso com funcionalidades de compensação de derivativos listados em bolsa e IA agêntica. O HSBC estendeu sua parceria de 15 anos com a Nasdaq ao adicionar a funcionalidade de compensação Calypso em derivativos listados em bolsa, juntamente com as capacidades já existentes em OTC e repo.

Serviços de Mercado

A receita líquida subiu 2%, atingindo o recorde para um terceiro trimestre de US$ 309 milhões. O crescimento refletiu maior participação de mercado e captura de receita em ações nos EUA, juntamente com maiores volumes em opções de ações nos EUA, ações à vista nos países nórdicos e renda fixa.

A margem operacional da divisão recuou 5 pontos percentuais, para 61%, refletindo em parte o desempenho da receita e um benefício de contrapartida de despesa de US$ 5 milhões no mesmo período do ano anterior.

A Nasdaq concluiu a aquisição da LEVEL em 15 de outubro. A administração espera que a LEVEL contribua com US$ 7 milhões–US$ 8 milhões em receita no 4T26. O negócio será reportado na rubrica de outras receitas em Serviços de Mercado.

Projeções da Administração

A Nasdaq elevou sua projeção de despesas operacionais não GAAP para 2026 de US$ 2,530 bilhões–US$ 2,570 bilhões para US$ 2,550 bilhões–US$ 2,580 bilhões. A administração afirmou que a faixa mais alta reflete custos associados a aquisições concluídas recentemente e o desempenho mais forte da receita no ano até o momento.

A empresa manteve sua estimativa para a taxa de imposto não GAAP em 2026 de 22,5%–24,5%.

A administração espera que a receita elevada de testes na área de Tecnologia para Mercados de Capitais continue no 4T antes de começar a desacelerar no primeiro trimestre. Alertou também que a divisão de Tecnologia para Mercados de Capitais enfrenta uma base de comparação difícil no 4T, pois o mesmo período do ano anterior incluiu receita antecipada (upfront) da Calypso.

Riscos e Pontos de Atenção

• A administração observou uma leve desaceleração recente no mercado de IPOs, com algumas empresas de determinados setores reavaliando o momento de suas ofertas, embora a Nasdaq tenha afirmado que seu pipeline de listagens permanece robusto.
• A captura em opções nos EUA diminuiu, à medida que o fluxo de ordens se deslocou para consolidadores em um ambiente de menor volatilidade. A captura em ações europeias foi afetada por uma mudança na estrutura de preços para o varejo, enquanto a receita de ações canadenses foi pressionada pela volatilidade do mercado de commodities.
• A monetização de IA continua em estágio inicial. A Nasdaq está utilizando contratos de acesso limitado e de menor duração para incentivar a adoção e avaliar o retorno dos clientes antes de expandir seus modelos de precificação.
• As migrações para a nuvem no AxiomSL e Calypso podem ser longas, pois os contratos geralmente duram de cinco a sete anos e as migrações exigem uma coordenação substancial com os clientes.
• A administração se opôs à estrutura atual da isenção de inovação da SEC, citando a transparência limitada de negociação e desafios para emissores monitorarem negociações tokenizadas fora das regras estabelecidas do mercado.

Destaques da Sessão de Perguntas e Respostas com Analistas

Adoção e monetização de IA: A administração afirmou que a Nasdaq está preparando seus dados para IA por meio de conectores MCP e incorporando capacidades agênticas nos produtos Verafin, Calypso e de vigilância de mercado. A entrega de dados baseada em MCP possui uma taxa adicional. A Nasdaq planeja expandir os modelos de precificação conforme os casos de uso dos clientes se desenvolvam.

Migração para a nuvem: A Nasdaq afirmou que migrar clientes consolidados para serviços gerenciados baseados na nuvem normalmente gera um aumento de cerca de 1,5x no valor do contrato. A adoção da nuvem também dá suporte ao fornecimento de fluxos de trabalho habilitados para IA, embora a migração completa para a nuvem nem sempre seja um pré-requisito para os recursos de IA da Calypso.

Tokenização: A administração vê a mobilidade de garantias como a oportunidade comercial mais imediata. A Nasdaq citou uma prova de conceito bem-sucedida com a Vanguard e a Wellington usando a Canton para mover garantias entre pools. A longo prazo, ações tokenizadas podem apoiar novas receitas em Serviços de Mercado e aumentar a liquidez do mercado.

Token de Ações da Nasdaq: A empresa está trabalhando com a DTCC, Kraken e outros parceiros de infraestrutura de mercado em uma estrutura de ações tokenizadas vinculada a identificadores de ativos já existentes. A administração planeja o lançamento no primeiro semestre de 2027 e afirmou que alguns emissores expressaram interesse em se tornar adotantes iniciais.

Alocação de capital: A Nasdaq gerou US$ 2,3 bilhões de fluxo de caixa livre nos últimos 12 meses. A empresa recomprou US$ 1,2 bilhão em ações durante os primeiros nove meses de 2026 e lançou um programa de recompra acelerada de ações de US$ 315 milhões–US$ 385 milhões em outubro, com conclusão prevista para o 4T.

Transcrição Completa da Teleconferência de Resultados

Transcrição completa da teleconferência de resultados

Comentários da administração

Operator

Good day, and thank you for standing by. Welcome to Nasdaq's Third Quarter 2026 Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker, Ato Garrett, Senior Vice President and Investor Relations Officer. Please go ahead.

Ato Garrett

Good morning, everyone, and thank you for joining us today to discuss Nasdaq's third quarter 2020 financial results. On the line are Adena Friedman, our Chair and Chief Executive Officer; Sarah Youngwood, our Chief Financial Officer; and other members of the management team. After our prepared remarks, we will open the line for Q&A. The press release and earnings presentation accompanying this call can be found on the Investor Relations website. I would like to remind you that certain statements we make on this call, including statements about our outlook, expectations, plans and strategies plans and strategies are forward-looking statements. These statements involve risks and uncertainties, and our actual results could differ materially from those expressed or implied in these statements.

A summary of the risks is contained in our press release and on a more complete description in our annual report on Form 10-K. These statements speak only as of today, and we undertake no obligation to update them. We will discuss our financial performance on a non-GAAP basis, excluding the impact of acquisitions and divestitures and the impact of changes in FX Definitions and reconciliations of our non-GAAP measures to the most directly comparable U.S. GAAP measures can be found in our earnings presentation as well as in a file located in the Financials section of our Investor Relations website at ir.nasdaq.com.

And with that, I will now turn the call over to Adena.

Adena Friedman

Thank you, Ato, and good morning, everyone. Today, I will start with a review of our third quarter financial results will then review the operating performance across our divisions. I will then hand the call over to Sarah to walk through the financial results in more detail. In the third quarter, Nasdaq delivered strong results across each of our divisions, building on the outstanding momentum from the first half of the year and reinforcing our position as a trusted transformation partner to our clients. Nasdaq is positioned to lead some of the most significant and enduring trends reshaping the financial system, many of which are still in the early stages of their impact. The investing landscape is undergoing significant change from the continued growth of passive investing to expanding levels of direct retail ownership, creating opportunities that reinforce Nasdaq's role at the center of the capital markets. The shift towards more connected and always-on markets is gaining momentum, and Nasdaq is shaping the next generation of market infrastructure. At the same time, artificial intelligence is becoming increasingly foundational to how institutions make decisions, manage risk and allocate capital, and Nasdaq is extending its leadership through solutions embedded across our platform.

The economic environment remains constructive for the progression of these key trends. The U.S. economy continues to demonstrate resilience while managing through inflation and elevated interest rates and is supported by strong corporate earnings, healthy consumer spending and continued investment in AI and digital infrastructure.

Now I'd like to turn to our results. In the third quarter, we delivered $1.5 billion in net revenue, up 14% year-over-year and solutions revenue of $1.2 billion, up 18%. Our overall annualized recurring revenue, or ARR, grew 14% year-over-year to $3.4 billion. Expenses were $638 million, up 12%. We delivered 19% diluted EPS growth driven by a 16% growth in operating income and the benefit of our share repurchase program. Within our divisions, Capital access platforms generated 20% revenue growth and 8% ARR growth. Financial Technology delivered 16% revenue growth and 18% ARR growth. And Market Services delivered 2% net revenue growth.

Now turning to the divisional results, I will start with capital access platforms where I will first discuss data and listings. Our listings franchise continued its strong momentum from the first half of the year. We welcomed 15 new operating companies raising $32 billion in proceeds, including 8 of the top 10 largest IPOs in the quarter, contributing to a 79% win rate. On a year-to-date basis, we have a 74% win rate, including 56 new operating company listings, raising a total of $144 billion in proceeds. We look forward to welcoming Hilton to NASDAQ in early November, following its announcement on October 20 that it plans to transfer its listing of common stock to the Nasdaq SoC market.

Our European listings business continued to drive growth in the Nordics, where we welcomed 8 new operating companies, including IQM Quantum computers, which was the largest European listing by market capitalization in the quarter. While we have seen a modest softening in the IPO environment in recent weeks, with some companies in certain sectors, reevaluating the timing of their IPOs. Our listings pipeline remains robust, and we are well positioned to support the diverse group of companies preparing to enter the public markets across a wide range of sectors. Our data business achieved double-digit growth driven by the strong client demand for our gold standard data powering AI solutions and the transition to always-on markets. During the quarter, we delivered a 34% year-over-year increase in the number of enterprise licenses across various client types and multiple geographies.

Our index franchise achieved a record $141 billion in net inflows over the last 12 months and $49 billion in the quarter, driven by product innovation, global expansion and growing investor demand for our products. We launched 32 new products in the quarter, including 10 insurance product launches, bringing total year-to-date launches to 97 products ahead of our pace at this point last year. 50% of all products launched during the quarter were introduced outside of the United States. Product innovation continues to generate significant growth for our index business with 35% of the trailing 12-month net inflows driven by products launched over the last 5 years.

We continue to experience early momentum from our partnerships with BlackRock and State Street with combined AUM exceeding $1 billion. We also continue to grow our long-standing partnership with Invesco expanding the Invesco QQQ innovation suite through the launch of the Invesco Nasdaq International Innovators 100 ETF.

Turning to workflow and insights. Our growth was driven by analytics with double-digit revenue growth in both eVestment and Datalink. This is supported by strong bookings growth and expanding client adoption. The rising demand for AI-enabled solutions continues to fuel growth within investment. Year-to-date, 25% of eVestment bookings were related to AI use cases. We expanded the coverage of eVestment's data assets to more than 95,000 private funds, a 19% increase from the end of 2025, strengthening our position as a trusted provider of institutional investment intelligence. We also expanded eVestment's reached through a new partnership with Juniper Square, launching Capital Intelligence, which embeds NASDAQ eVestment data directly into Juniper Square's workflows for their private markets clients.

In Datalink, we continue to expand distribution as clients develop AI native workflows. For example, we recently entered a partnership with Robinhood to embed a new proprietary data set into its agentic trading platform. This gives investors access to sophisticated market sentiment and institutional grade investor insights to power agentic decision-making.

Turning to Financial Technology. We achieved another excellent quarter, delivering revenue growth of 16% and record ARR growth of 18%. Clients continue to choose our solutions to modernize and transform their organizations, driving resilient demand for our mission-critical technology with sales cycles, contract term lengths and bookings mix remaining consistent. In the quarter, we signed 54 new clients, 5 cross-sells and 135 upsells. Our long-standing investments in our cloud capabilities continue to underpin our performance. This quarter, 85% of bookings across our fintech portfolio were for cloud-based solutions.

Nasdaq achieved its highest ever ranking in Cartus RiskTech 100 this quarter, placing #2 globally and earning 14 category awards across risk management, financial crime prevention, trade surveillance and corporate governance. This achievement is a testament to our One Nasdaq strategy in action, building integrated capabilities that help clients solve their most pressing challenges. In financial crime management technology, Nasdaq Verafin delivered 23% revenue growth with ARR growth increasing 2 percentage points sequentially to 19%. During the quarter, we signed 45 new SMB clients and 3 enterprise deals, bringing the total enterprise signings to 12 year-to-date, exceeding the 9 enterprise signings we delivered in the entirety of last year. Nasdaq Verafin continues to accelerate AI innovation across both its products and operations with more than 850 clients using our agentic AI workforce. Expanding those capabilities, we moved 2 new agentive workers into production in the quarter, the agentic AML analyst for structuring and our first fraud focused worker, the agentic fraud analyst for ACH.

Regulatory technology delivered a sustained growth, driven by client demand for Nasdaq solutions that support modernization initiatives across cloud, AI and digital assets. Overall, we signed 10 new clients, including 2 cross-sells and 86 upsells. In AxiomSL, we delivered higher subscription revenue driven by strong client engagement and upsells. We continue to build momentum internationally, expanding geographic coverage with one of the largest private banks in Switzerland and adding a lead Brazilian bank as a client. We continue to see strong engagement from a wide range of banks, across both size and geography as they prepare for the evolving regulatory landscape. For instance, we signed a G-SIB to a Basel III implementation this quarter. We also deepened our relationship with the super regional U.S. Bank, which expanded its use of our cloud-based solutions to modernize its operations.

In surveillance, we saw strong demand as markets move towards always-on operations, including client wins with Kraken, Cachi and APAC. These engagements highlight our role in helping emerging market operators, safeguard market integrity and investor confidence at scale. We also expanded client adoption of our AI capabilities, signing new clients for calibration copilot and GenAI News copilot while building a growing sales pipeline for our broader AI solutions. Capital Markets Tech continued its strong momentum, driven by robust growth in trade management services as well as new client wins and upsells in our software solutions. Across the business, we signed 2 new clients, including 1 cross-sell and 48 upsells. In Calypso, we're driving the platform across AI, post-trade and digital asset capabilities supporting clients as they modernize and automate critical workflows.

We announced that HSBC is extending its 15-year partnership with Nasdaq, adding Calypso's comprehensive exchange-traded derivatives clearing capabilities. This new capability brings clearing across OTC, exchange-traded derivatives and repos into a unified platform, helping HSBC manage margin, collateral and risk more efficiently. This milestone reflects our continued investment in Calypso to provide the integrated technology, collateral efficiency and AI-ready data foundation that clients need as markets move towards an always-on future. This quarter, we also launched agentic AI capabilities within Calypso, enabling clients to deploy and scale AI agents across the trade life cycle. These agentic capabilities will be critical as market infrastructure evolves towards an always-on environment. This new operating paradigm requires continuous risk management and real-time intelligence to help clients monitor, prioritize and respond to events at scale.

In Market Technology, the growing demand for always-on markets continues to fuel demand for our technology. This quarter, Bruce ATS signed an agreement to use Nasdaq's trading technology to power the first 24/7 U.S. equities trading ecosystem. Expanding continuous equities trading through the weekends through an institutional-grade ATS is a significant development for the market. We're pleased to be versus partner to achieve this next step.

Turning to Market Services. We continue to lead the industry in share and capture. The division delivered 2% revenue growth to $309 million, a record for the third quarter. Our performance was fueled by higher share and near record capture in U.S. equities. We also experienced higher volumes across U.S. equity options, Nordic cash equities and fixed income. Looking ahead, we remain on track to launch [indiscernible] trading on the Nasdaq stock market on December 6, 2026. This launch of expanded nearly continuous weekday trading hours is an important step in the journey to always-on markets, enabling broader investor access and greater transparency for all market participants. Within Market Services, Nasdaq has established digital liquidity networks, which unifies the capabilities, investments and solutions we've been developing to advance tokenization and always on markets under 1 strategy.

Within digital liquidity Networks, we closed our acquisition of level markets on October 15, adding the third largest alternative trading system or ATS in the U.S. by trading volume. This acquisition strengthens our ability to deliver institutional-grade liquidity and execution solutions to our clients. We now have new flexibility in serving our clients' needs in the existing U.S. equity market environment through an off-exchange venue. We also have the ability to expand LEVEL ATS to new markets and to connect its 2,500 institutional and retail brokerage clients to multiple global markets and asset classes through Level Connect. Additionally, we continue to work closely with DTCC as it prepares to launch its organization service this month, and we remain on track to launch the Nasdaq equity token in the first half of next year. Together, these efforts advance the modernization of U.S. equity markets while putting issuers at the center of tokenization.

Our third quarter results demonstrate the durability of our strategy and our strong position at the intersection of the trends reshaping our industry. We remain focused on delivering trusted, scalable solutions that supports both innovation and resilience across the financial system. Through the markets we operate, the technology we provide and the intelligence and risk management solutions we deliver, we're partnering with clients to navigate an increasingly interconnected financial ecosystem.

With that, I'll turn the call over to Sarah to walk through our financial results in more detail.

Sarah Youngwood

Thank you, Adena, and good morning, everyone. In the third quarter of 2026, Nasdaq delivered excellent results, headlined by diluted EPS growth of 19%, solutions revenue growth of 18% and ARR growth of 14%, including record fintech ARR growth of 18%. Let's start with quarterly results on Slide 11. We reported net revenue of $1.5 billion, up 14%, with solutions revenue of $1.2 billion, up 18%. Operating expense was $638 million, up 12%, leading to an operating margin of 57% and an EBITDA margin of 60%, both up 1 percentage point over the prior year period. This resulted in net income of $588 million and diluted EPS of $1.04, up 19%.

Slide 12 shows the drivers of our 14% net revenue growth for the quarter. We generated 10.5 percentage points of Alpha, supported by new and existing clients and product innovation. Meanwhile, beta factors contributed 3.5 percentage points of growth, driven by higher valuations in Nasdaq indices, higher derivatives volume in index and higher overall volumes, primarily in U.S. options.

Let's review division results, starting on Slide 14. In Capital access platforms, we delivered revenue of $641 million, up 20% with ARR growth of 8%. Data on testing revenue and ARR were both up 10%. The move towards always-on markets and extending AI use cases are supporting client demand for our data franchise, and we expect them to be durable trends for years ahead. The strong data revenue growth in this quarter was driven primarily by upsell, new bookings, pricing and usage. Listings revenue benefited from IPOs and pricing in proceeds, partially offset by 2025 delistings and lower amortization of prior period initial listing fees, which were consistent with the last quarter. Index revenue was up 39%, with 15 percentage points of growth driven by Alpha. ARR, which covers a very small portion of index revenue increased 10%. Revenue growth was primarily driven by a record average ETP AUM, which surpassed $1.1 trillion in the third quarter. The performance was bolstered by record net inflows of $141 million over the last 12 months including $49 million in the third quarter.

We are driving strong momentum in the Nasdaq 100 franchise, which is supported by secular growth in passive investing with strong retail ownership and further market share expansion. Volume-based revenue was also a contributor to growth with record derivative contract volumes up 70% in the quarter. and amidst the continued mix shift in derivatives from higher-priced immune contracts to lower-priced micro immune contracts. In Workflow & Insights, revenue was up 5% in the quarter with ARR growth up 6%, driven by double-digit revenue growth in both eVestment and Data Link, while Corporate Solutions revenue was essentially flat. Quarterly operating margin for the division was 64%, up 3 percentage points versus the prior year.

Before we wrap on capital access platforms, an update on our portfolio optimization. In addition to the previously announced sale of Nasdaq Fund secondaries to Nasdaq private markets and the acquisition of [indiscernible], which was closed in the third quarter, we announced the wind down of our Sustainability Advisory business and the sale of Nasdaq Material to Osapiens, which closed on August 19. In the third quarter, the net effect of these 3 items would have been a net increase in the workflow and insights pro forma adjusted revenue growth rate of approximately 50 basis points.

Moving to Financial Technology on Slide 15. Revenue was $529 million, up 16%, driven by double-digit revenue growth across all 3 subdivisions with record ARR growth of 18%. Our business continues to see strong demand across all fintech subdivisions, with cloud deals accounting for 85% of ACV bookings in the quarter. The division signed 54 new clients, 135 upsells and 5 cross sales in the quarter. Cross sales continue to represent over 15% of the fintech pipeline.

Financial client management technology revenue grew 23% in the quarter. with ARR growth of 19% and net revenue retention of 111%. We signed 45 new SMB clients in the third quarter, contributing to 26% in year-to-date ACV bookings growth versus the prior year period and reflecting sustained demand in the SMB segment. In Enterprise, we signed 2 cross-sells and 1 expansion. Enterprise clients signed in the second half of 2025, progressed through their implementations during the quarter, contributing to the sequential improvement in revenue and ARR growth.

Regulatory technology delivered revenue growth of 13% and ARR growth of 15%, reflecting strong performance across both Surveillance and AxiomaSL The division delivered 10 new clients, including 2 cross sells and 6 upsells in the quarter. Capital Markets Technology revenue grew 14% and with AR growth of 19%. The Sun division signed 2 new clients, including 1 cross-sell and 48 upsells. The quarter's strong performance reflects the pricing increase in trade management services, which we announced earlier these, demand for data center service and an elevated level of testing, demand in market technology driven by infrastructure modernization initiates and continued execution at Calypso despite a tough comp on revenue growth in the quarter due to upfront revenue in the prior year period. This was partially offset by lower professional services revenue, which was part of the difference between revenue and ARR growth.

As a reminder, Capital Markets Technology revenue growth in the fourth quarter of 2025 benefited from a contribution from Calypso upfront revenue, which will create a tough comp for capital markets technology in the upcoming quarter. Financial Technology quarterly operating margin was 46%, up 1 percentage point versus the prior year period.

Wrapping up the divisions with Market Services on Slide 16. The division delivered net revenue of $309 million, up 2% and representing a third quarter record. Growth in the quarter was driven primarily by Alpha in U.S. equities with extremely strong capture due to the lower volatility environment as well as higher market share in both U.S. and European equities with an additional beta contribution from higher industry volumes in U.S. options and European cash equities. This performance was partially offset by a change in capture in U.S. options, which was a strong $0.09 performed down due to the continued mix shift in the composition of order flow towards consolidators in a lower volatility environment, lower capture in European equities due to a pricing change for retail volumes in support of market share and lower revenue in Canadian equities due to market volatility in commodities.

Our leading positions in both equities and options provide a natural balance across market conditions. Our volatility and trading activity evolves, we benefit from a diversified portfolio that is not dependent on a single market environment. We continue to manage effectively the balance between capture and market share across our markets. We maintained a strong lead over our closest competitor in U.S. multi-listed options with a year-to-date market share gap of over 500 basis points, combined with a lower sequential decline in capture. Further, we are well aligned with industry board factors, including the off-exchange segment with the acquisition of LEVEL, the continued expansion of index options and the launch of 235 trading.

Quarterly operating margin for the division was 61%, down 5 percentage points versus the prior year prior, primarily due to revenue performance and a $5 million contra expense benefit in the prior year period, which we previously mentioned. Before we walk on Market Services, as Adena mentioned, we closed the acquisition of Levo on October 15 and launched digital liquidity networks, which will unify the capabilities, investments and solutions, which we have been developing to advance organization and always on markets under 1 strategy. The level revenue contribution for the fourth quarter is expected to be $7 million to $8 million, and the expense are included in our updated expense guidance. Moving forward, we will report revenue from Level and digital liquidity network within other revenue in our Market Services division.

Moving to expense on Slide 17. We had operating expense of $638 million in the third quarter, an increase of 12%, driven by employee compensation, reflecting our strong revenue execution and severance costs. increased marketing expense due to a strengthening IPO environment and investments in technology to support revenue and drive innovation and growth. The third quarter operating margin was 57%, and the EBITDA margin was 60%, both up 1 percentage point versus the prior year period. We are updating on non-GAAP expense guidance for the year to a range of $2.550 billion to $2.580 billion from $2.530 billion to $2.570 billion with 2 primary drivers. We are raising the top end of the range to reflect expected costs from the recently closed acquisition with the 2 transactions contributing about equally to the increase. And we are raising the midpoint due to the combination of the impact of the recent M&A and the strong revenue performance we have experienced year-to-date. We maintained our 2026 non-GAAP tax rate guidance of 22.5% to 24.5%.

Turning to capital allocation on Slide 18. Nasdaq generated free cash flow of $616 million in the third quarter. Over the last 12 months, Nasdaq generated $2.3 billion in free cash flow at a conversion ratio of 98%. We paid a dividend of $0.31 per share or $173 million in the quarter, representing a 30% annualized payout ratio. During the quarter, we repurchased a total of 3.6 million shares of our common stock for $323 million. In combination with the dividend, Nasdaq returned nearly $500 million to shareholders in the third quarter. During the first 3 quarters of the year, we have repurchased $1.2 billion, almost doubling the $616 million of repurchases in all of 2025. Additionally, in October, we launched a variable notional accelerated share repurchase plan of $315 million to $385 million. It will be completed in the fourth quarter. We finished the quarter with a gross leverage of 2.5x.

In closing, Nasdaq delivered another quarter of excellent execution. Our third quarter results in combination with our performance in the first half of the year demonstrate the strength of our business model and strategy. Our position as a trusted transformation partner to our clients and our leadership in helping to shape the next generation of financial markets. As we enter the fourth quarter and move towards the new year, we are extremely confident in our opportunity, and we remain focused on executing on our strategic objectives and delivering long-term value to shareholders.

With that, I'll open the floor for Q&A.

Operator

[Operator Instructions] And I show our first question comes from the line of Ashish Sabadra from RBC Capital Markets.

Perguntas e respostas

Ashish Sabadra

Adena, you highlighted several agent AI solutions across your portfolio and AI is obviously driving greater demand for your data and workflow platform. Can you elaborate further on how AI is becoming a source of competitive differentiation and how that dynamic is translating into the upsell and cross-sell momentum across your platform?

Adena Friedman

Sure. Yes. Thank you. We really appreciate that question. We are really focused on making sure that we deliver data that is AI ready, and we deliver capabilities within our software solutions that really drive towards agentic capabilities for our clients. And as you can see, we're starting to broaden out how we're doing that and where we're delivering that. So starting actually in cap with the eVestment and Datalink and our market data, we have created MCP connectors to allow our clients to absorb and kind of ingest the data in a very flexible way to allow them to integrate them into agentic workflows. I do want to say we're very careful in how we deliver that, making sure we can track and trace it and also understanding the use cases that our clients are using the data for, but it is definitely driving, I wouldn't say upsell, but just demand for our products for sure. And we've mentioned a couple of stats, 25% of the new bookings for eVestment related to AIU's cases as an example.

And then Datalink, which is oftentimes, the partners are using this is for agentic workflows. And I think Robin has a good example of that. And then within fintech, we have a whole range of capabilities we're delivering. And we mentioned that we have over 850 users now of the agentic workers within Verafin, and we have over 70 clients signed now to paying deals. So they have signed contracts to make sure that they're paying for their solutions. And we have a nice pipeline of opportunity to continue to upsell our clients with those capabilities. So we're really excited about the momentum there. I think we mentioned in prior quarters, it's kind of a freemium model. So now we're actually propagating that freemium model into Calypso and surveillance. And we're introducing agent workers and agentic AI antoclypso for risk management and into surveillance for basically workflow management on alerts.

And those are just starting. So we're building a pipeline. And I think we mentioned that we've been selling more of those solutions through Surveillance. Calypso, we just announced it a couple of weeks ago at [indiscernible] it had a really, really strong really, really strong resounding actually support from the clients. So we're excited about building a pipeline there.

And then lastly, I should mention a broader strategy, which is as clients are thinking about how they're going to deploy AI, they're moving more and more of their own infrastructure into cloud. And so we are seeing an uptick in cloud signings within our fintech solutions. I mentioned we had 85% of bookings in cloud. And that allows us to be more of a managed service provider, which, of course, delivers an uplift in the ACV that we're signing. So we feel all in, we're really driving and playing to the demands that our clients are needing. And I think we're delivering ahead of what they would expect. I mean, the level of support is really, really high.

Operator

And I show our next question comes from the line of Michael Cho from JPMorgan.

Y. Cho

I just want to continue on the same line of discussion here around AI and maybe Verafin more specifically, but just more color for me from a pricing angle. I mean, Adena you talked about the 850 Verafin clients using the agent workforce. I think that's up from 500 a quarter or 2 ago. But it also feels like more broadly, the world is probably becoming a bit more accustomed to paying more for AI. And so I know you called out 70 paying clients, but how are you really thinking about the broader pricing road map for these agentic solutions, whether it's Verafin or more broadly across Nasdaq really in terms of maybe pace in magnitude from here.

Adena Friedman

Sure. Yes, we're all -- the entire industry is kind of at the beginning of a trend. So we want to make sure that the very first thing we do is build trust with our clients. and therefore, build adoption from our clients. And so that's why we've chosen an intentional approach to giving them a capability with some limits on it where they can try and -- kind of try before you buy. And I think that's been -- I think we're really starting to prove that out to be a successful approach within Verafin. As I mentioned, we do have the 70 paid clients. We have a really nice pipeline. We're also signing them to shorter-term contracts. And that's actually been both ways. I think what the clients are looking at this and saying, let me make sure that it's really going to drive the efficiency that I want and us are saying, well, we want to make sure that we know that these capabilities have a lot of value. we're going to be approved, really strong return on investment for these products. And so we want to make sure that we have the flexibility to continue to get paid for the value we're providing as we expand the agentic workforce with our clients.

And so I think that as we're just now getting to the point where we feel really good about the monetization strategy we have. And now we're able to replicate that with some of the other fintech solutions as we're driving agentic capabilities in those solutions. And you're going to continue to hear us rolling out new agentic capabilities across fintech and in CAP in the quarters to come. But I also would say in the data space, we are up charging. So if you are taking our data through an MCP connector, we are up charging for the MCP connector. And we've done that in the past where if it's a new delivery method, we will get -- we will pay an upcharge for that delivery method. And that's a way for us to get some immediate revenue. And then over time, as we understand how they're expanding the use cases, and we're driving our data into more expanded AI capabilities. We'll look at different pricing models that will support that as well.

Operator

And I show our next question comes from the line of Patrick Moley from Piper Sandler.

Patrick Moley

Adena, I just had 1 on the SEC's innovation exemption was announced a month or so ago. we've seen the first TSV filings coming in. So I was just hoping to get your thoughts on that innovation exemption and how you think Nasdaq is positioned. And then on the issuer side, how have your conversations with listed companies gone around tokenized equities? Are they aware that this affects them? And then do you have any sort of idea of what percentage of your listed companies you think would be interested in potentially tokenizing equity at this point?

Adena Friedman

Sure. Yes. I think in a way, these are 2 distinct conversations, but they're related, obviously. So if we think about the innovation exemption as it stands and how it's constructed, and we've been very clear with the SEC on our views on it. Our view is that the innovation exemption does not -- well, it allows the issuers to opt out, the overall construct of the innovation exemption, we think, is we're not supportive of. I mean, to say it that way. So it sits outside of all of the general rules that govern the trading venues that trade U.S. equities today. So it doesn't -- none of the trades get reported to the tape. They're not -- there's no transparency into those venues at all. There's no way for issuers even to understand how to manage their own inside of trading programs if they have this kind of trading that's happening outside the confines of [indiscernible].

And our view is that tokenization, we should be focused as an industry as on tokenizing the -- all of the trading, not trying to create this kind of sidecar experimentation. But the good news is, I think the SEC did limit the extent to which these innovation exemptions can have an impact on equities -- the most important thing is that there are hard limits on the trading in terms of 25 basis points for stocks that are essentially in the Russell 1000 and 250 basis points for smaller companies. So there's not going to have a huge impact on our business. It's just the notion of it and how we go about creating change in the industry. I think it's important for us to work together. There was no common period for this either. And so we feel it's -- they're asking for comments now, I think we're providing them.

So we have been having conversations with our issuers, making sure they understand the risk as we see it, we have made a public statement that we will not be including our stock into TSVs. So if the TSE reached out to us, we will opt out, and as we then pivot the conversation with issuers to, well, how would organization work, what, how can it benefit them, we then talk more about the efforts that we're undertaking, which is that we're building the Nasdaq Equity token standard. We're working with DTCC and other post-trade providers. We're working with Kraken to innovate in the space to deliver an underlying tokenized equity that goes down to the CUSIP and the master security file and also offers real-time settlement through an ecosystem. And the really neat thing is that with the level ATS now, when we distribute the tokenized equity out through Kraken, they will use Level ATS to execute those equities, those equity orders.

So it's a really, really nice elegant solution, and then we'll have instantaneous settlement through another partner. And so that's a really interesting innovative way but it also allows the issuer to have line of sight into those investors. So the Nasdaq Equity Turner token actually delivers the ability for us to track and trace to provide not on to like who it is, but just to have the issuer understand that the tokens are sitting where and how do they communicate to them and how do we allow for things like proxy to happen in a more elegant way. So a long answer, but we really care about this, and we're working very hard to drive it through the center of markets and then also to offer this as part of our global solutions from a technology perspective, as markets moved to always-on, we think that this is a core part of the demand drivers across our FinTech solutions, our index business, in our data business.

Operator

And I show our next question comes from the line of Owen Lau from Clear Street.

Kwun Sum Lau

And I do want to follow up with this tokenization debate. There are some companies publicly pushing back on tokenizing the shares and Nasdaq could do the same thing as well. Do you think your approach on tokenization can convince yourself and maybe some other companies to essentially tokenize shares -- and I know you talked like you explained some of the answers already, but I want to get a better sense about how you think about your way and convince them to tokenize the shares.

Adena Friedman

Sure. In the conversations, they actually have been very constructive conversations because it's an opportunity for us both to discuss to make sure they understand and are aware of the TSVs that are asking to tokenize their shares, but also that we get a chance to educate on what is totalization and how can it be beneficial to them and why should they care? And I can say that as we've pivoted from a discussion of the TSV to what is the Nasdaq Equity token, what are we building? And how will it create a better way for them to be able to manage their shares to the public markets and communicate with investors, they actually get -- they get -- I'm going to say some at least excited. Some are neutral, some get excited about it. And we have had a couple of clients say, "Well, we would like to be an early adopter of the Nasdaq equity token. So that's great for us because it's allowing us to kind of have a level of engagement that's important.

And we'll see. We're going to launch in the first half of next year. So we have some time to continue to work on it and engage those issuers as to like what is that we're delivering to them. And how can they -- what kind of -- how does the platform work? We're also partnering with some really important key partners that are part of the core infrastructure of the markets today. And we look forward to having further opportunity to announce that going forward.

Operator

And I show our next question comes from the line of Alex Blostein from Goldman Sachs.

Alexander Blostein

I was hoping to go back to some of the discussion around the financial crime business. And just to think through sort of 2 things. One, the ARR seems to be growing at an accelerating pace. You obviously highlighted a number of sizable wins, including a couple of enterprise wins as well within that business. Can you maybe expand on where you're seeing the incremental demand for these services and maybe weave that in with sort of some of the cyber security risk that we continue to hear about. That's partially related to AI as well and how that could inform your longer-term growth algorithm in that business?

Adena Friedman

Sure. So the increment, I think first is as we're moving upmarket into enterprise, the strongest entry point for us is fraud and in the broad space. And what's great is that we can basically implement our layer on top of whatever existing AST system they already have. So we can just make their learnings better take down their false positives -- every time we run a proof of concept with a client, we can demonstrate like clear, measurable ROI which is terrific on reducing false positives and increasing fraud found. And so it's a very -- I won't say easy, but it's a very straightforward way for us to enter in and help them.

I think the AI and the ability for criminals and networks to use AI to really amplify their activities is making this a very urgent problem. It's a $500 billion-plus problem in the world, just fraud alone. $4.4 trillion in AML. And so this is such an urgent issue and an area where we've seen a complete change in the attitude of banks towards this is a collective action problem. We need to solve as an industry, we can't do it alone. And so the value of our consortia data lake is becoming extremely valuable.

The other thing is we can use it Gen AI now into that consortium data lake, and we've been adding new data sources into it as well that allows us to see criminal networks much more holistically. And we're able to look at what would be seemingly unrelated fraud alerts and kind of bring them all together and realize this is a criminal ring we found on criminal ring that was across 1,000 accounts and 45 institutions that had different topologies of behavior. I mean they were executing different premineactivities. And we're able to see that now that we can then deliver that into our clients and say, this is not just isolated SARs. This is something that is part of a bigger ring, and they can do joint SARs reporting.

So it's really quite exciting. And I think the large banks realize that they can't do it alone anymore. So that's what's been driving both the demand but also a sense of urgency that they have to solve the problem differently.

Operator

And I show our next question comes from the line of Alex Kramm from UBS.

Alex Kramm

Dive a little bit deeper into the capital markets technology strength. I know there are some few things that you've talked about already some of the pricing changes, but it does seem like this quarter in particular, if I kind of try to back into like new sales continues to be really strong. So maybe just talk about where that's coming from and how sustainable you think this acceleration is because, again, some of these things you probably were one-timers like pricing increases. But as we think about next year, it seems like if this momentum continues as they can continue to be upside to your targets?

Adena Friedman

Sure. Yes. So Capital Markets tech, as you know, that's the 3 components, Alex. And TMS continues to be a strong driver of growth. As we -- as you said, we did announce that we had a pricing action earlier this year. It was effective Jan 1. So it's been an effective year. And that's certainly creating lift. The second thing is there's just demand for connectivity, demand for new format connectivity. We also have some new innovations we've brought into our infrastructure. around liquid cooling. And we're still benefiting from some of the expansion that we've done in the data center in the last couple of years.

And then in recent quarters, this quarter, next quarter, and actually, I think one of the former earlier this year, there's some benefit of elevated testing. So it's not just us who do migrations, but we have other systems inside our data center, where they're managing through migrations, and we allow -- we offer testing for fee and that actually is creating an uplift in revenue. This quarter, you'll see it again next quarter starts to trail off a little bit in Q1.

But that's kind of episodic. So I do want to say that's not all that some of that comes and goes. But the overall demand for TMS is high, and we've been innovating to offer new capabilities. Then in Calypso, very exciting what we're doing to innovate there. I do want to emphasize actually the launch of the exchange traded clearing solution. That is a brand -- kind of almost a brand new product. We had like very, very narrow capabilities in exchange traded clearing before. and HSBC has been a great partner to work with us to build out a complete capability there that really allows us to go to market with new -- essentially a new module or a new product within Calypso, and be much more comprehensive in allowing people to manage risk.

Our view is always on markets in are going to make it so that the convergence of markets and asset classes geographies is going to be amplified very significantly. And so risk management, you can't just look at risk management in one asset class anymore. You've got to look at it across whether it's OTC or exchange traded, and it's got to be global. So -- and then you have to use agentic capabilities to manage risk in real time and take action in real time over time. So -- all of the capabilities we're building in Calypso are related to that in addition to tokenization, and it's been a big investment year for us, but we see it unlocking durable demand.

And then the last thing in market tech is we have market -- we're continuing to find really great opportunities in market tech. We mentioned, Bruce, but we have other markets that are using us for managed services and we're continuing to help them modernize our platforms and moving to cloud. So I would agree, Alex, I think it's just -- it's a really good demand environment right now.

Operator

I show our next question comes from the line of Brian Bedell from Deutsche Bank.

Brian Bedell

My question is on tokenization. I think you answered really well. So I'm going to just add one in a different frame, and that's the digital liquidity networks and then the addressable market that you identified in the Investor Day earlier this year of the $3 billion to $6 billion TAM from tokenization by 2030. If you can just comment on whether you see more visibility into that TAM? And do you see this as more of an opportunity for your solutions businesses versus market services and maybe which areas?

Adena Friedman

Yes. Actually, in the nearer term, we actually see it as being actually more of a driver towards data and our solutions businesses. And then over time, as we develop out the Nasdaq equity token and build that platform and start to offer capabilities on top of that platform. We see that as a of revenue -- a new revenue opportunity that would sit within market services. But I think that what -- and then the last thing is, of course, tokenization, if it's done right, and it's done across asset classes and unlocks collateral and makes it so that the markets are more liquid and markets more accessible to more investors, you're increasing the liquidity of markets, which will obviously have a tailwind to market services.

So -- but to me, that's like a little bit of -- like -- I don't want to say a lagging indicator, but it's a little longer term than I've got to get my infrastructure ready for always on, and I need to get my infrastructure ready for tokenized collateral. Those are things that have, we think, a nearer-term demand driver within Calypso and Market Tech and in [indiscernible]. So that -- it is -- we see a visibility into the TAM, we kind of understand where it could come from. We have now like very specific points of execution that we are starting to articulate to you as to where are we focusing on driving toganization, always on markets, tokenization, they're all related to each other. Level becomes a part of that equity token design, Calypso's digital assets, capabilities and AI capabilities, trade surveillance in terms of demand there and then, of course, increased demand for our data as the markets globalize. We see all of those things coming together to create our ability to execute against the TAM.

Operator

And I show our next question comes from the line of Ben Budish from Barclays.

Benjamin Budish

I was wondering if you could talk a little bit about the growth in the mini -- the Nasdaq 100 features franchise. It looks like the micros, as you kind of alluded to have kind of been growing off the charts. Curious what you're doing to invest behind that thoughts on the sustainability? Maybe you could talk a bit about the platform. This is coming from, and do you see any potential opportunity to translate this into maybe some more growth at NDX, which I know has also been a bit of a priority for you.

Adena Friedman

Yes, great. Well, so as you know, we have a really wonderful partnership with CME, and they do a terrific job. I think I was reading their earnings yesterday. So I was reading their comments. And they talked about the growth of direct retail investors into their platform. They are very focused on creating more accessibility to retail for their futures franchise and it's obviously showing up in the numbers. I mean a 70% increase in volumes is really spectacular. But it's also -- as you said, it's also coming from some of those smaller price. So like as they make the notional value of each futures contract cheaper, it makes it so it just opens up a new avenue towards retail. And I think that's very intentional and very smart in how they're doing that. and they are connected to a whole range of retail platforms to be able to execute that.

So the partnership is as strong as ever. And then as you're right about NDX because if you also -- NDX and I would say, [indiscernible] trading, are amplifiers of demand for the option -- well, for the futures for the ETF for the underlying. And then over time, as -- we don't currently have extended hours and options, but we would expect over time that options hours will expand, and that will give us a chance to expand the NDX franchise. But the NDX franchise just in U.S. market hours is continuing to grow, and it is a flywheel between the underlying the ETF, the option in the future. strategies can be executed and more sophisticated strategy to be executed. So I think they all play off each other really nicely.

Operator

And I show our next question comes from the line of Michael Cyprys from Morgan Stanley.

Michael Cyprys

Just another one on tokenization. You've outlined several initiatives, including tokenize equities, collateral mobility. So just curious if you're engaging with customers today, where are you seeing the Clarus commercial demand for tokenization today -- can you elaborate a bit on some of the milestones that you're working towards over the next 12 to 18 months. And I think you mentioned instant settlement, if I heard you right, on the Nasdaq token. Just curious how you think about the financial systems' ability to fund instant settlements given the substantial benefits from netting today?

Adena Friedman

Yes. That's actually a great question. I want to make sure I cover that. The more immediate opportunities sit in this idea of collateral management, collateral mobility because it's not just equities that are getting tokenized, but treasuries are getting tokenized, money market funds are getting tokenized, money is getting tokenized. And so all forms of collateral and repos are getting tokenized. So all forms of collateral are moving into a tokenized state -- and that allows for the opportunity for banks to think about moving their money from 1 collateral pool to another in a much more seamless way. .

Nasdaq Calypso is the premier provider of collateral management capabilities to the industry around the world. And then we have a partnership with [indiscernible] Systems that basically they connect into clearinghouses and they and clearing pools, and they can move the collateral from one to another. And they're working with us to move that in a tokenized state. We actually also were able to demonstrate that. So we had a proof of concept with 2 major investment management firms, leverage in Canton to move collateral from one collateral pool to another and it worked instantly and it worked perfectly. So that proof of concept was a really good one.

Yes. I was checking to make sure I could need them. So Vanguard and Wellington, so it was really exciting to have such a large and premier asset managers working with us on this. So that's the most immediate. I do want to get to the point of instant settlement. So let me be clear in terms of what we think is netting is very important in U.S. equities, it's very important. We trade about $1 trillion a day. So having to gross up trading in equities is an incredibly expensive proposition. It's not something that the industry feels that that's -- and it's also a huge benefit. There's so many reasons why netting is important. And that generally comes with batching the clearing. The question is, do you need to do it all [indiscernible]? Can you batch intraday?, Can you batch maybe even at the end of the day, it just start to eliminate more and more of the risk, the overnight risk and the time risk associated with clearing. And I think that's a real possibility with tokenization. You put it into a more elegant form and money can move and stocks can move at more easily, then you can start to think about how you bring settlement up faster.

But in the meantime, there's also the opportunity for us to work on a very innovative capability where you would have gross trading. So this is prefunded or essentially growth settlements real time of retail trades. So you have to think about it as like in a retail ecosystem with much smaller trade sizes and a different way of managing accounts, the crypto world is already prefunded in cash anyway. So it's kind of -- it's a continuation of that model, but with tokenized equities. And that's what we're doing with Kraken. And we would then settle them through a very innovative custodian solution that we're working on with a partner. So I think it's very, very exciting to see how we can think differently about the future of markets this way.

Operator

And I show our next question comes from the line of Dan Fannon from Jefferies.

Daniel Fannon

Adena, I was hoping to get your updated thoughts on large scale M&A in the current environment. And then more broadly, as you think about capital return priorities as we look beyond the ASR and into 2027.

Adena Friedman

So for Sarah.

Sarah Youngwood

Yes, we have, as you know, very strong free cash flow, over $2 billion that enables us to do a lot on [indiscernible] been at 2.5x. So within our leverage target range, you've seen us continuing to be focused on organic growth. And so needless to say that you're seeing the execution on that organic growth this quarter. We're seeing the very large some in-time opportunities that we have. So a lot to do there, and we're well invested in that regard. [indiscernible] to partnerships. We've seen new tuck-ins and so whether it's date, whether it's level that are very additive and we've talked about those, and we might do bolt-ons also. And I've talked about our share repurchase for one. We love buying our stock. It has been a core part of our program and $1.2 billion, which is twice what we did approximately last year just in 3 quarters. is really participating in the EPS formula for us and we're very, very happy to return capital to shareholders in a very accretive form, especially given how attractive from that point of view. It's the only point of view. The stock price is sell the value of our stock, we love doing it. So a lot of flexibility, a lot of opportunities, and we are continuing to be very rigorous for shareholders.

Operator

And I show our next question in the queue comes from the line of Jeff Schmitt from William Blair.

Jeffrey Schmitt

How much runway remains for cloud migration across Axium and Calypso. And could you remind us just how much those migrations affect the contract values in your ability to kind of sell AI modules?

Adena Friedman

Yes. So I think it's actually -- that points to a really good one. So in terms of the runway, it's actually a fair amount of runway because we have a lot of established clients in both of those products that have been on-prem clients for a long time. And so as they're renewing and those renewal cycles are long, right? So we could sign a client for anywhere from, I would say, anywhere from the shortest being 3, but most of the time, 5 to 7 years and sometimes 10. So they come along in waves. And -- but during that renewal, we really worked towards getting them into a cloud state. But those migrations are big, and it requires a lot of conversation with the client. So we still have a long runway. We tend to say that it's about a 1.5x uplift on as we move into a cloud migration because we then become a managed service provider to them. And so we're doing more for them to manage their infrastructure and they're not having to do as much. So I mean it is turning out to be about that.

In terms of the -- yes, so actually, one thing that we also focus on is what is the percentage of SaaS revenue to our total ARR, and that's slowly creeping up, we're at it's solely creeping up as we continue to move more and more of our annualized clients to cloud. In terms of AI workflows, great question because we basically are delivering those AI capabilities in the cloud form, right? So it doesn't necessarily -- like for Calypso, I don't think you have to be a full cap cloud client, to be able to take advantage of the AI layer we've created. But generally speaking, as we deliver our capabilities through our cloud-based solutions. So it's important to make sure that we innovate in our products we deliver those innovations in a modern state that allows our clients to innovate as well. We just don't want to choke them off, and particularly Calypso. We don't want to make it a prerequisite necessarily, but for other products, we will.

Operator

And I show our next question comes from the line of Simon Clinch from Rothschild & Co Redburn.

Simon Alistair Clinch

I guess a broader question here, and this maybe ties in with some of the comments made about capital allocation and also the sort of feedback loop between solutions and the Market Services business. I mean with all the conversations you've had about tokenization and the future of markets, it feels like we're going to a market environment where eventually, your customers will have a huge amount of choice in how they do their trades, how they implement their needs. And I was wondering, how does -- how do you expect that to alter the mix of business Nasdaq has today between the solutions and market services. Should we expect any sort of shift in that dynamic over the next decade or so? Just curious about your thoughts on that.

Adena Friedman

Well, we -- actually, we just look at the growth drivers underpinning solutions businesses versus markets. We've had really nice strong growth in markets. And we actually expect with -- as we move to globalized markets and tokenized markets, we will have an uplift in liquidity that should come from those activities because that's a big driver of why it's so attractive is opening up the accessibility of markets. But our solutions businesses generally are growing at a rate that's faster than our markets businesses on a longer-term basis. Our index business, for instance, 39% growth in the quarter, but just imagine that the growth of index alone is really at a very high rate. And we expect -- we just see a lot of demand drivers there to underwrite that innovation economy and investors' appetite for that. So we would expect our -- and then the last thing is, of course, in all of our software and data solutions, those are intimately linked with the ability to actually increase the liquidity, right? So all of that's kind of that flywheel. And I can't sit there and say what exactly the mix of business is going to be. But as a general matter, we -- our solutions businesses are becoming a bigger part of our business over time, just based on the relative growth rate. And in the future, we have kind of growth opportunities in both elements of our business that's really strong and exciting.

Operator

We have completed our Q&A session for today. At this time, I'd like to turn the call back over to Adena Friedman, President and CEO for closing remarks.

Adena Friedman

Great. Thank you. Well, our third quarter results reflect the disciplined execution of our strategy and reinforce our role as a trusted transformation partner to the global financial system. I want to thank all of you for joining the call today, and have a great day. Thank you.

Operator

Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect. Goodbye.