Financial Trends -- 8.0/10
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
| Total Revenue | $9,168M | $9,636M | $9,903M | $11,761M | $12,640M |
| YoY | — | +5.1% | +2.8% | +18.8% | +7.5% |
| Net Revenue | $7,146M | $7,292M | $7,988M | $9,279M | $9,931M |
| YoY | — | +2.0% | +9.5% | +16.2% | +7.0% |
| GAAP Diluted EPS | $7.18 | $2.58 | $4.19 | $4.78 | $5.77 |
| Adj. Diluted EPS | $5.15 | $5.30 | $5.62 | $6.07 | $6.95 |
| Adj. EPS YoY | — | +2.9% | +6.0% | +8.0% | +14.5% |
| Adj. Op. Margin | 58% | 59% | 59% | 59% | 60% |
| Adj. EBITDA | — | — | $5,566M | $6,073M | $6,605M |
| Adj. Free Cash Flow | $2,821M | $2,906M | $3,197M | $3,620M | $4,187M |
| FCF YoY | — | +3.0% | +10.0% | +13.2% | +15.7% |
| Total Debt | $13,918M | $18,122M | $22,613M | $20,368M | $19,644M |
| Debt/EBITDA | 3.0x | 2.8x | 4.1x | 3.3x | 3.0x |
| Dividends/Share | $1.32 | $1.52 | $1.68 | $1.80 | $1.92 |
| Div YoY | — | +15.2% | +10.5% | +7.1% | +6.7% |
- Net revenue grew from $7.1B to $9.9B over 5 years, an 8.6% CAGR. FY2024 jump reflects first full year of Black Knight contribution
- Adj. EPS compounded at 7.8% CAGR, accelerating to +14% in FY2025 as integration synergies and operating leverage kicked in
- Adj. operating margins expanded steadily from 58% to 60%, remarkable given the absorption of a major acquisition
- Adj. FCF grew from $2.8B to $4.2B (10.4% CAGR), with FY2025 delivering 16% growth -- the strongest year in the series
- Leverage spiked to 4.1x post-Black Knight (FY2023) but has been rapidly reduced to 3.0x, demonstrating disciplined deleveraging
- GAAP EPS was distorted in FY2022 ($2.58) due to goodwill impairment; adj. EPS is the better trend indicator
- Dividend per share grew at a 9.8% CAGR, with 6 consecutive years of increases
- Net revenue grew YoY in every quarter of 2025, with Q2 2025 the strongest at +9.8%
- Q3 2025 was the softest quarter (+2.6% YoY) due to lower energy transaction volumes, but Q4 rebounded to +7.8%
- Adj. EPS growth outpaced revenue growth in every 2025 quarter (10-19% vs 3-10%), reflecting strong operating leverage
- Adj. operating margins expanded to 61% in Q1-Q2 2025 before normalizing to 59-60% in H2, all above the 58-59% range of FY2024
| Segment | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 |
|---|---|---|---|---|---|---|---|---|
| Exchanges | $1,223M | $1,246M | $1,254M | $1,236M | $1,367M | $1,415M | $1,265M | $1,364M |
| YoY | — | — | — | — | +11.8% | +13.6% | +0.9% | +10.4% |
| Fixed Income & Data | $568M | $565M | $586M | $579M | $596M | $597M | $618M | $608M |
| YoY | — | — | — | — | +4.9% | +5.7% | +5.5% | +5.0% |
| Mortgage Technology | $499M | $506M | $509M | $508M | $510M | $531M | $528M | $532M |
| YoY | — | — | — | — | +2.2% | +4.9% | +3.7% | +4.7% |
- Exchanges (54% of net rev): Strongest segment with +9-14% YoY growth in 3 of 4 quarters of 2025. Q3 2025 was an outlier at +0.9% due to lower energy volumes. Record 2.3B contracts traded in 2025 (+13% YoY)
- Fixed Income & Data (24%): Steady mid-single-digit growth every quarter (4.9-5.7%), demonstrating the recurring, subscription-like revenue base. Best quarter for net new business since 2020 in Q4 2025
- Mortgage Technology (21%): Improving trajectory from +2.2% (Q1 2025) to +4.7% (Q4 2025). Black Knight revenue synergies nearly doubled to ~$100M. GAAP operating income turned positive in Q2 2025 -- a key inflection point
- Exchanges: Margins of 73-76% are best-in-class for any financial exchange. Slight compression in Q3-Q4 2025 (73-74%) vs Q1-Q2 (76%) reflects seasonal volume patterns
- Fixed Income & Data: Margins stable in the 43-46% range, reflecting the higher cost structure of data and analytics delivery
- Mortgage Technology: The standout story -- margins expanded from 35-37% in 2024 to 39-42% in 2025, a 500-700bp improvement driven by Black Knight expense synergies ($230M annualized, exceeding the $200M target)
| Metric | FY2025A | FY2026E | YoY |
|---|---|---|---|
| Adj. EPS | $6.95 | ~$7.71 | +11% |
| Q1 2026E EPS | -- | ~$1.91 | -- |
| Revenue Growth | +7% | Mid-single-digit | -- |
| Analyst Rating | -- | Buy (8-14 analysts) | -- |
| Avg Price Target | -- | ~$193-$198 (18-22% upside) | -- |
- Consensus expects adj. EPS growth of ~11% in FY2026E to ~$7.71, driven by continued operating leverage and synergy realization
- Revenue growth expected to moderate to mid-single-digit as Black Knight anniversary effects normalize
- Street models conservative mortgage assumptions -- management sees $200-500M incremental revenue upside at normalized origination volumes (7-10M loans vs ~4M today)
- Tokenization initiative and treasury clearing mandate (Jan 2027) not meaningfully modeled by the Street
ICE delivered its 20th consecutive year of record revenues in FY2025, with net revenue of $9.9B (+7% YoY), adj. EPS of $6.95 (+14%), and adj. FCF of $4.2B (+16%). Adj. operating margins expanded to 60%, demonstrating that the company can absorb a major acquisition (Black Knight) while still expanding profitability. The 5-year CAGR profile is compelling: net revenue at 8.6%, adj. EPS at 7.8%, adj. FCF at 10.4%, and dividends at 9.8%.
The Black Knight integration has been executed impressively. Expense synergies reached $230M annualized (exceeding the $200M target), revenue synergies nearly doubled to ~$100M, and the mortgage segment achieved GAAP profitability for the first time in 2025. Leverage has been reduced from 4.1x to 3.0x in just two years.
Growth is broad-based across all three segments. Exchanges (+9% FY2025) benefits from structural energy and rates tailwinds. Fixed Income & Data (+5%) delivers steady recurring growth. Mortgage Technology (+4%) is in early recovery with significant cyclical upside ahead.
Score: 8.0/10 -- Exceptional compounding with accelerating EPS growth, expanding margins, strong FCF conversion, and disciplined capital allocation. Slight ding for the still-elevated $19.6B debt load and the dependence on mortgage cycle recovery for the next leg of growth.