Cboe Global Markets, Inc. (CBOE) Q4 2025 Earnings Call Transcript

Hello, and thank you for standing by. My name is Tiffany, and I will be your conference operator today. At this time, I would like to welcome everyone to the SIBO Global Markets fourth quarter earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press star, then the number one on your telephone keypad. I would now like to turn the call over to Ken Hill, Head of Investor Relations. Ken, please go ahead.

Good morning, and thank you for joining us for our fourth quarter earnings conference call. On the call today, Craig Donahue, our CEO, will discuss our performance for the quarter and provide an update on our strategic initiatives. Jill Grieveno, our Chief Financial Officer, will then provide an overview of our financial results for the quarter, as well as discuss our 2026 financial outlook. Following their comments, we'll open the call to Q&A. Also joining us for Q&A will be Chris Isaacson, our Chief Operating Officer, Prashant Bhattia, our Head of Enterprise Strategy and Corporate Development, and Rob Hawking, our Global Head of Derivatives. I would like to point out that this presentation will include the use of slides. We will be showing the slides and providing commentary on each. A downloadable copy of the slide presentation is available on the Investor Relations portion of our website. During our remarks, we'll make some forward-looking statements which represent our current judgment on what the future may hold. And while we believe these judgments are reasonable, these forward-looking statements are not guarantees of future performance and involve certain assumptions, risks, and uncertainties. Actual outcomes and results may differ materially from what is expressed or implied than any forward-looking statements. Please refer to our filings with the SEC for a full discussion of the factors that may affect any forward-looking statements. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise, after this conference call. During the call this morning, we'll be referring to non-GAAP measures as defined and reconciled in our earnings material. Now, I'd like to turn the call over to Craig.

Good morning, and thank you for joining us to review our fourth quarter and full-year results. CBO delivered record net revenue and adjusted earnings for the quarter and year, powered by continued strength across our core businesses. These results demonstrate how our products continue to resonate with a diverse group of users across regions and asset classes. We remain focused on extending this momentum as we execute on our strategic direction we laid out on our last earnings call. Reducing our focus in certain areas while we redirect our time, talent, and capital to our core businesses and emerging opportunities. During the fourth quarter, SIBO grew net revenue 28% year-over-year to a record $671 million, and adjusted, diluted EPS increased a robust 46% to a record $3.06. That makes sense. For the full year, CBO delivered record net revenue of $2.4 billion, up 17% year-over-year, generating adjusted, diluted EPS growth of 24% to $10.67 per share. The exceptional results in the fourth quarter were underpinned by double-digit net revenue growth in every segment and record results in each category at CBO. Specifically, strong volumes in both our multi-list and proprietary index option products drove the strength in the derivatives category. Solid new sales growth led to gains in our SIBO data vantage business, and robust industry volumes propelled our cash and spot markets higher. While 2025 was an impressive year, we remain focused on sustaining and amplifying our momentum by leveraging the strong, secular trends across our core businesses. Taking a closer look at the fourth quarter trends by category, our derivatives franchise delivered a record fourth quarter with net revenue increasing 38% year-over-year to cap a record year in which revenue grew 22%. In our multi-list options business, net transaction and clearing fees revenue was up a strong 41% given higher industry volumes and positive pricing trends. The multi-list options space remains an area where we believe CBO has a right to win and will continue to enhance our position within the industry to drive greater results over time. We're encouraged by the recent innovation in the space, underscored by the launch of Monday and Wednesday expirations for select multi-list names. While we are focused on educating market participants on the unique risks associated with single stock zero DTE trading, we believe These additions ultimately expand the toolkit available to investors. This development complements our index options franchise by elevating awareness of the utility zero DTE strategies provide while allowing us to reinforce the advantages of index options, namely the larger notional size, diversified risk profile, and daily cash settled structure as compared to single stock options. More broadly on the index options side, net transaction and clearing fees revenue was up a strong 40% as our proprietary SPX options complex set new records, powered by robust growth in zero DTE options trading. SPX Zero DTE ADV was up an impressive 66% year-over-year, while overall SPX ADV increased 39% to a record 4.3 million contracts. Zero DTE options made up over 61% of SPX volumes, up from 51% share a year ago. We saw a similar dynamic in mini-SPX options, where 0DTE ADV was up 135% as compared to the fourth quarter of 2024, making up just over half of the mini-SPX volume to end the year. In our proprietary options business, it's worth noting that the 10 highest average daily volume months occurred in 2025 and 2026. In fact, nine of the ten highest SPX days on record occurred in the fourth quarter of 2025 or first quarter of 2026, pointing to the healthy momentum in the franchise today. We also saw growth in our VIX products. Volume in both VIX futures and VIX options gained 15% last quarter amidst increased market uncertainty with two notable spikes in volatility, generating robust trading opportunities. For the third year in a row, VIX options set a new record in trading volume, averaging 862,000 contracts a day in 2025. As concerns rise over the concentration risk in U.S. equity markets, we're seeing renewed interest in small cap stocks for those looking to diversify their equity exposure away from large cap tech. Volume in our Russell 2000 index options jumped 20% last quarter to reach their highest level in almost 10 years. We're excited to add Russell 2000 Index Options to our Global Trading Hour session starting this month, giving investors the opportunity to trade small-cap stocks around the clock. This will capitalize on the strong demand we have seen from international investors to access U.S. markets with total volume in our GTH session up 34% last quarter. Looking ahead, we remain bullish on the outlook for our core derivatives franchise anchored around strong retail demand, continued international growth, and further product innovation. Beyond these secular drivers, rising geopolitical tensions and increasing economic uncertainty should remain a tailwind for our products as investors turn to options to help better manage risk and generate income. Moving to cash and spot markets, net revenue was up a strong 27% as we saw solid growth in our cash equities business in Europe and North America, as well as in our global FX business. Led by another quarter of strength in our European transaction businesses, the Europe and Asia-Pacific segment delivered a 24% year-over-year increase in net revenue. This was driven by a 33% year-over-year growth in net transaction and clearing fees, given strong industry volumes, stable market share trends, and improved net capture dynamics. Higher non-transaction revenues in the segment also contributed to the growth, with revenue up 15% year-over-year. North American equities made a solid contribution with net transaction and clearing fees revenues up 18% given strong equity volumes in each of our markets. Non-transaction fees were also up double digits as our entire cash equity ecosystem benefited from the more active trading environment. Rounding out cash and spot markets, Global FX made another notable contribution, increasing net revenue 22% year-over-year in Q4. The fourth quarter results continue FX's long track record of revenue growth and caps an impressive 17% net revenue growth rate for 2025. Beyond the macro backdrop lifting activity across our cash and spot markets businesses, we are unlocking incremental revenue opportunities through our securities financing transactions clearing service in Europe. Launched in response to strong client demand, this service has leveraged ZivoClear Europe's pan-European footprint to introduce central clearing to a securities lending market that has traditionally operated on a bilateral basis. This market plays a key role in enabling asset owners to earn additional income by lending out their portfolios, enhancing returns for beneficial owners. By bringing clearing to this market, our service can provide participants with meaningful capital and risk efficiencies. The first trades were executed in March 2025, and we have seen hundreds of new contracts across 15 active European settlement locations cleared every day between borrowers and lenders, with notional outstanding loan values exceeding 1 billion euros in January 2026. Turning now to DataVantage, net revenue increased by 9% on a year-over-year basis, reflecting continued momentum across our platform in the fourth quarter. Notably, roughly 90% of the growth across our market data and access businesses was again driven by new unit and new sales as opposed to pricing. This growth was underpinned by strong demand for access to our markets, a durable and growing international contribution, and favorable trends in our newer product offerings. If we look more broadly at the full year results, net revenues increased 10% across the DataVantage platform. Importantly, we saw each component of our DataVantage business Market data and access, indices and risk market analytics, all trend higher on a year-over-year basis. Now, I'll turn the call over to Jill to walk through the details of our financials and 2026 guidance.

Thanks, Craig. SIBO posted another record quarter with adjusted diluted earnings per share up 46% on a year-over-year basis to a record $3.06. I will provide some high-level takeaways from this quarter's operating results before going through the segment results. Net revenue increased 28% versus the fourth quarter of 2024 to finish at a record $671 million. We saw healthy growth in all categories, with the strongest growth coming from our derivatives business. Specifically, derivatives markets Cash and spot markets net revenues grew 38 percent. Cash and spot markets net revenues grew 27 percent. And DataVantage net revenues grew 9%. Adjusted operating expenses of $221 million were up 8% on a year-over-year basis. Adjusted operating EBITDA of $465 million grew 40%, and adjusted operating EBITDA margin expanded by 6.1 percentage points to 69.2%, a result of both our robust revenue results and discipline expense management. The fourth quarter results capped a remarkable year at SIBO, where annual net revenue grew 17% to $2.4 billion, and adjusted earnings per share of $10.67 was up 24%, both setting new annual records. Turning to the key drivers of the quarter by segment, our press release in the appendix of our slide deck include information detailing the key metrics for our business segments, so I'll provide some highlights for each. The options segment delivered another quarter of record net revenue, increasing 34% year-over-year. The growth was driven by a 40% increase in net transaction and clearing fees in the fourth quarter. Total options ADV was up 24%, with a 35% increase in total index options volume and a 20% increase in multi-listed options volume. The rate per contract for our options business also increased 13% on a year-over-year basis, given a positive contribution from both our indexed and multilist products. North American Equities net revenue rose 17% versus the fourth quarter of 2024, with strong industry volumes driving an 18% increase in net transaction and clearing fees. On the non-transaction side, market data fees grew 12%, and access and capacity fees increased 10%. Europe and APAC produced 24% year-over-year net revenue growth. Net transaction and clearing fees were up 33%, while non-transaction revenues were up a combined 15%. Futures net revenue increased 12% from the fourth quarter of 2024. The increase was primarily due to a 16% uptick in total ADV, given a resurgence of VIX activity during the quarter. And finally, global FX net revenue was up 22% on a year-over-year basis, driven by a 17% increase in average daily notional value and an 8% increase in net capture. Looking at our SIBO Data Vantage business, net revenues were up 9% year-over-year in the fourth quarter. Revenue growth was again underpinned by healthy new subscription and unit sales, representing approximately 90% of this quarter's growth, with the remainder coming from pricing changes. We remain encouraged by the success of our newer product offerings are having, including dedicated cores, timestamping services, and one-minute open-close data. Regionally, we saw incremental growth in index and market data sales fueled by new brokers coming online in the Asia-Pacific region. Overall, we remain pleased with the multiple avenues of durable growth in our data-vanaged business. Turning to expenses, total adjusted operating expenses were $221 million for the quarter, up 8% on a year-over-year basis. This increase is reflective of higher compensation and benefits expense, which primarily resulted from our strong 2025 revenue growth, increasing our short-term incentive compensation. Before detailing our 2026 guidance, I would like to provide a brief progress update on our strategic realignment over the past quarter and explain how these actions are reflected in our 2026 expectations. During the fourth quarter, we commenced the sales process for our SIBO Australia and SIBO Canada businesses. We have seen strong initial interest from potential buyers, and we will continue working towards an outcome that delivers a positive solution for all parties. Although we have initiated sales processes for CBO Canada and CBO Australia, we continue to operate those units as business-as-usual, and the revenue and expense contribution of each is included in our 2026 guidance. We plan to provide updates as milestones are met in the sales process and detail any subsequent financial impacts. We have also ceased operations on our corporate listings businesses while driving efficiency in our growing U.S. ETP listings business and European ETP listings business, as well as several of our smaller risk and market analytics businesses. Our 2026 guidance fully incorporates the anticipated revenue and expense impacts from these actions. And finally, last year we made the decision to explore ways to reduce our cost footprint for CBO Europe derivatives exchange. Referred to as FedEx. As we further assessed the business, it became clear that FedEx was unlikely to meet targeted revenue and profitability metrics, given the retail investing landscape and market structure in Europe. And in January 2026, we made the decision to close FedEx. Our 2026 guidance includes the impact of our decision to wind down FedEx. The financial impact of the CEDEX wind-out is expected to be largely realized in 2026 and does not change the overall estimated revenue and expense impact ranges communicated on our October 31st earnings call related to our strategic realignment decisions. For full year 2026, we are introducing the following guidance. We anticipate our data vantage organic net revenue growth to be in the mid to high single-digit range. And we expect our total organic net revenue growth to be in the mid-single-digit range. We are also introducing our 2026 Adjusted Operating Expense Guidance range of $864 to $879 million, representing 3.3% growth on the low end and 5.1% growth on the high end. Our guidance accounts for some modest inflation in our core expenses, along with the expected financial implications associated with the recently announced leadership transition, and provides room for incremental investment and emerging opportunities. A few areas where we are excited to make some near-term incremental investments include expanding our securities financing transaction capabilities, as well as new product development around emerging event prediction markets. Our full-year guidance range for CapEx is $73 to $83 million, and our depreciation and amortization is expected to be in the $56 to $60 million range. We expect the effective tax rate on adjusted earnings under the current tax laws to come in at 27.5% to 29.5% for the full year. With the midpoint of the range 80 basis points below the 2025 rate as a result of an expected decrease of tax expense associated with uncertain tax positions. And while we don't provide formal guidance on interest income or interest expense, we expect that interest income, net of interest expense, will be a $3 to $4 million positive contributor for the first quarter of 2026. On the capital front, we continue to look for ways to effectively allocate capital and drive long-term, durable shareholder returns. In the fourth quarter, we returned $76 million to shareholders in the form of a $0.72 per share dividend, bringing the total amount of dividends paid in 2025 to $284 million. Factoring in both share repurchases and dividends, CBO returned a total of $350 million to shareholders in 2025. We entered 2026 with a great deal of balance sheet flexibility, as evidenced by our adjusted cash position of $2.2 billion and a leverage ratio of .9 times. We are well-positioned to invest in organic or inorganic opportunities, as well as redeploy capital to shareholders as dividends or opportunistic share repurchases. Moving forward, we remain focused on optimizing our capital deployment and look forward to delivering on long-term shareholder value objectives. Now, I'd like to turn it back over to Craig for some closing comments.

Thank you, Jill. As we move forward as an organization, we are focusing more attention on driving results in our core businesses and preparing for emerging opportunities across our industry. We believe that capitalizing on those opportunities starts with having the right group of leaders in place. As we announced last week, we are thrilled to welcome Heidi Fisher to head our cash and spot markets businesses. Scott Johnston as our new COO. Both bring a wealth of industry experience in their respective fields and strengthen our management capabilities across our core businesses at SIBO. I want to take a moment to express my sincere gratitude for the many contributions that Chris Isaacson has made throughout his tenure at SIBO. From his early days as a founding BATS employee in 2005 to his meaningful contributions as a key member of our executive team and our COO, Chris has been an integral part of SIBO's growth and identity. Chris has embodied a SIBO-first mentality, and we are fortunate that he will continue to serve as an advisor through 2026. Now, I'd like to turn the call to Chris. to say a few words.

Thank you, Craig. First, I'd like to thank my CBO colleagues for everything we've accomplished together in your trust over the past 20-plus years. It's been an incredible run together. To the investor community, I'm grateful for your engagement and thoughtful interest through the years. It's been a privilege to build so many meaningful relationships with you during my time at BATS and SEBO. While leaving SIBO is certainly bittersweet for me, I'm excited for the opportunity to spend more time and be more fully present with my family. I feel there's no better time to pass the baton given the excellent momentum of the business under Craig's leadership, the recent strategic decisions we've made as an organization, and the support of a capable leadership team with long-tenured leaders as well as talented new ones coming into the organization.

Thank you again, and with that, I'll hand it back to Craig. We have been incredibly deliberate in our efforts to strengthen leadership across our core businesses. This transition with Chris has been thoughtfully planned, and we are excited to bring in leaders of Heidi and Scott's caliber. With the addition of Heidi, Scott, and recent key hires in strategy and corporate development, global derivatives, Clearing and data vantage, our management team has added an average of over 25 years of industry experience per hire. Importantly, these new hires are complemented by our efforts to elevate talent from within CBO. Given the depth of talent now in place across each of our core businesses along with a robust regional leadership team of proven executives, I believe we are better positioned than ever to capitalize on the numerous opportunities ahead. 2025 was a remarkable year on many fronts, and we begin 2026 with a position of real strength, supported by healthy secular tailwinds, a fortified and aligned leadership team, and a sharpened focus on each of our core businesses. With this foundation in place, We are well prepared to build on our momentum and unlock even greater value for our shareholders in the years ahead. I'll now turn the call back over to Ken for questions and answers.

At this point, we'd be happy to take questions. We ask that you please limit your questions to one per person to allow time to get to everyone. Feel free to get back in the queue, and if time permits, we'll take a second question.

At this time, if you would like to ask a question, press star, then the number 1 on your telephone keypad. To withdraw your question, simply press star 1 again. We will pause for just a moment to compile the Q&A roster. Your first question comes from the line of Patrick Moley with Piper Sandler. Please go ahead.

Yes, good morning. So you guided to mid to high single digit data vantage revenue growth in 2026, which is consistent with what you've introduced guidance at the last few years. But more recently, you've been trending closer to high singles to low doubles. And it seems like a lot of that's been driven by momentum internationally and the new unit sales. So could you just elaborate on the decision to maintain the mid to high single digit revenue growth target? Should we interpret that as just general conservatism, or are you expecting growth to slow over the next few quarters? Thanks.

Hey, Patrick. Thanks for the question. So, you know, really when we look to set the annual guidance, we look at it on a full year basis, as opposed to, you know, just the quarter-to-quarter piece. We continue to see the durability in the data vantage business, but, yeah, as we said, the guidance is still very comfortable with that mid-to-high single-digit range, but, again, some good momentum is coming from new usage, the sales with about 10% coming from the pricing.

Yeah, and I think I'd add to that, you know, to Jill's point, just the timing of sales may vary quarter-to-quarter, but on an annual basis, we're pretty... Just for some color around what's happening within DataVantage, from a market data perspective, we see a lot of momentum sales overseas. About 45% of our new data sales this quarter were from overseas clients, and that compares to about 35%. So we're seeing good momentum there. If you look at our recurring sales during the quarter, three out of our top five recurring sales came from clients in the Asia-Pacific region. So we're seeing good momentum there. Similarly, across our CGI businesses and analytics businesses, the utilization of ETFs continues to be strong, and there's a lot of client demand for that. So we're really positive on...

Okay, thank you.

Your next question comes from the line of Dan Fannin with Jefferies. Please go ahead.

Thanks. Good morning, Craig. I was hoping you could expand upon your comments around the single name zero DTE, you know, recent rollout and why you, I guess, what gives you confidence around that not cannibalizing potentially your index business and ultimately, you know, expanding the pie, I think is how you described it. I was hoping to get a little bit more context around that.

Yeah, sure. Thanks, Dan. I'll start, but I'll turn it over really to Rob. I mean, I think we view it as additive to the market, but, I mean, fundamentally, there's a lot of differences between, from the customer perspective, including Yeah, and maybe I'll even...

Monday, Wednesday options have been good. They're largely concentrated, really, in tune. Obviously, but Monday, Wednesday options are ranging between 10 to 30 percent of the total number of options that are trading in the nine names. SPX. Craig alluded to, you know, Be more. Because it's a diversified basket. to the civic news, which really means more gaps. Zero DTE. Thank you. You know, premium decay throughout the day, and so those strategies are really less suited. We're more unpredictable. I'm a shorter tenor. And zero DTE.

Our next question comes from the line of Eli Abood with Bank of America. Please go ahead.

Good morning. Thanks for taking my question. You completed the number of introducing broker onboardings in 2024 and 2025, Robinhood, of course, but then also several APAC brokers. I was hoping you could give us any sense of the contribution of these new brokers to the strong SPX volumes in 2025, and then what does the pipeline look like for further broker ads in 2026?

Yeah, this is Rob. Thanks, Eli. Maybe I'll take that question. We don't get down to specific SPX attribution, but I can take it up one notch for you. As you mentioned, we continue to expand. We continue to see their eyes. In kind of the midterm, I think I saw. The kind of growth of options. As you mentioned, on the APEX side, we continue to see strong demand from international retail brokers. Especially for SPX options, the Megatech... We're also in demand. I'm with 10. local brokers that So more growth there.

Your next question comes from the line of Ban Budish with Barclays. Please go ahead.

Hi. Good morning, and thank you for taking the question. I don't think you've talked about prediction markets yet on the call. I know there's been some press indicating that you are either thinking about or having early discussions with brokers regarding sort of yes-no options. So could you maybe give us an update of where you are in the thinking in terms of product design, conversations with distribution partners, market makers, anything else that you could share? Thank you.

Yeah, absolutely. We're excited about the continued growth in the event prediction markets. We really view this as a logical extension of SIBO's existing strengths, and they provide a clear entry point for new customers and really a pathway to... As I just mentioned, our current focus is on the financial and economic. And where we believe we can deliver. We can leverage, really, our technology, the existing product liquidity, which I think is important, and... and reliability that comes with And one of the important points I think that's worth highlighting, you know, our first initial offer. It clearly differentiates what we're doing from a lot of the non-security. We've been 200,000 SPXs. As you mentioned, all-or-nothing payout profiles that this newer investor is looking at. To mention, we're encouraged by the recent comments from both Chair Atkins and Chair Selig, especially around drawing clear lines between what's considered a security versus a CST-regulated swap. You know, their remarks re- So to speak.

Thank you very much.

Your next question comes from the line of Brian Bedell with Deutsche Bank. Please go ahead.

Great. Thanks. Good morning. Thanks for taking my question. Maybe just to follow on from that, and then maybe just to add a question for Jill on the revenue guidance with that. So the second quarter launch, just to clarify, that's for the binary options, I believe. And then I guess the follow-on question is, would you expect to be launching the actual more traditional prediction market contracts? Is that just coming in the next quarter or two, or is that a longer-term development? And then I know the expenses for developing these are in the guidance. Is there any revenue assumption from these embedded in the revenue guide as well? And then, Jill, if you could just, on that revenue expense guide, can you just reconfirm the part that you are including in that versus the commentary on the third quarter call? I think the divestitures were a 3% net revenue drop on an annualized basis with an 8% to 10% expense drop. Sounds like most of that is still in there because of the Canada and Australia commentary, but just wanted to confirm.

So, yeah, thanks, Brian. I can start with your questions around the event contracts. So, second quarter is for It will be... Thank you. I think our core products. The differentiator on that, and then once again, in the security. On the other contracts, Retail broker platforms. What they're after. The more, call it traditional contracts, more, you know, yes, no, around an offense. We roll out.

I like this.

Yeah, I'm just sorry. Securities, do you mean single name company securities or index securities or both?

We'll be starting with index. That's just a natural fit at the moment, but, you know, that will potentially expand. You know, I mentioned the 200,000. minimum increment vertical spreads, and those minimum vertical about this all-or-none new concept.

So a couple different components to your question. Let me know if I miss anything here, but the first one that I'll address is just on your question as to what we're including from the 2026 revenue guide as it relates to the new prediction and event contract opportunities that Rob has spoken to. I'll just say that there's, you know, a small contribution contemplated in the 2026 revenue guide, but we really do expect that to ramp more over time and we'll continue to update our models. That becomes more clear. As it relates, though, to the strategic realignment pieces and how those factor into the guidance, again, there are a few different tranches there that I tried to address in the prepared remarks, but we'll just take a couple minutes here to further articulate and clarify those. So to your earlier point, we did communicate back in October that we expect the net impact of all of the realignment to result in about a 3% net revenue loss. So those would relate to the decision to wind down the Japan equities business, corporate listings, and then some of the optimizations we've made within the risk and market analytics business, as well as any revenue contemplated from the SEDx initiative. So again, those knowns are built into the 2026 guide. The piece that still lives within the 2026 revenue guidance, though, is The contribution that's contemplated from CIVO Canada and CIVO Australia, given that those businesses are still actively owned and operated by CIVO. As the sale progress progresses there, and if and when there's an impact on either 2026 revenue or expense contributions from those businesses, we'll recast our guidance and communicate those.

That's great. And the expenses, the related expenses to what you just described is also in and out, expenses in for Canada and Australia, expenses out for the other things that you've closed.

Correct. So the 2026 expense guidance does include what we expect the expenses to relate to Canada and Australia, correct? And then... There will be somewhat of a timing lag on some of the optimizations we're doing, but for the most part, we do see a bit of savings then in 2026 from, you know, the Japan piece, corporate listings, the risk and market analytics optimization, as well as the SEDEX wind-down. So those knowns are embedded within the 2026 expense guide.

Great. Thank you so much.

Your next question comes from the line of Alex Blaustein with Goldman Sachs. Please go ahead.

Hey, guys. Good morning. Thank you for the question. So a lot of the strategic initiatives that you've talked about are meant to be organic, build-outs that feels consistent. The balance sheet obviously continues to be in a really good place, so I was hoping you could refresh us on your latest thoughts around share repurchases or any other use of capital over the next kind of 12 to 18 months.

You bet. So, I mean, if you look back historically, our return on capital is actually, we get some of the highest returns on organic investments. So, on the heels of the strategic realignment, obviously, we are pivoting away from certain areas of the business. But what that is allowing is both time and balance sheet flexibility to really invest in areas where we do see some promise. Really looking to optimize around the core. A couple of the opportunities that we've mentioned today from an organic standpoint are the focused investments that we're making to further build out our security financing transaction line of business, as well as, you know, some of the product development and opportunities around the event prediction markets. So we really are laser-focused on continuously looking at all of our core business lines to see what further enhancements or optimizations we can make to generate that long-term revenue flow. That isn't to say, though, that share repurchases don't remain a priority. We absolutely still will look to do those, again, on an opportunistic basis. We do also have a history of paying a quarterly dividend and also have increased that annually. If you look back to August of 2025, we did announce a 14% increase to the dividend. Really, you know, we like the flexibility that we have at the moment. We like the dry powder, and, you know, we'll just continue to look to optimize the capital returns based upon the opportunities that are ahead of us.

Great, thank you.

Your next question comes from the line of Alex Kram with UBS Financial. Please go ahead.

Hey, good morning, everyone. At the risk of asking Brian's question a little bit more specific on the expense side, Jill, you know, of the 8% to 10% that you talked about on the last call, can you maybe just give us the number of how much of that is now basically out of the 2026 cost guide? Thank you.

Good morning, Alex. No, we're not breaking it out on that discreet of a level. What I'll say, though, is there are quite a few tranches of things that are coming off, and then, you know, some organic investments that we're making, coupled with what I will say is, you know, the majority of the savings would come later on. From some of the Canada-Australia pieces, but like I said, we already are starting to see the full-year benefit of the Japanese equities piece, as well as looking for a good portion of the SETEX component to come out. So it really is a balance there. You do see it reflected, though, in the guide that we came out with. So, you know, you look at the lower end of the range, the 864, higher end of the range, the 879. That suggests, you know, somewhere of a 3.3% to a 5.1% expense, guys. Again, we will keep you updated over the course of the year as more becomes known with the timing of the CBO, or CBO Australia and CBO Canada pieces. But for now, again, feel good with that range that we've communicated given some of the pieces that are in motion.

Understood. Figured I needed to ask. I'll be back with a follow-up. Thanks.

Your next question comes from the line of Ashish Sabhadra with RBC Capital Markets. Please go ahead.

Thanks for taking my question. I was wondering if you could provide more color on the rollout of dedicated course, as well as talk about the new growth initiatives and new product roadmap within the data vantage.

One minute open. The data sets. We've rolled those out. We've started in the U.S., and then we took them across to markets in Europe. We've got some new launches planned as well. There's an option like . . . We have a strong interest in...

Thank you. That's great.

Your next question comes from the line of Jeffrey Schmidt with William Blair. Please go ahead.

Hi, good morning. You discussed on the last call that you're working on pricing improvements for your exchanges, whether it's market maker incentives, more attractive rebate programs, things like that. Could you provide us with an update on what you're doing there? Is that really for the multi-listed options? Thanks.

Hi, yeah, this is Rob. I'll take that one. And yeah, it's for the multi-list space. We're still, you know, it's an exciting space for us and really core to SIBO. As all the reports show, you know, industry volumes continue to grow. But we'll say, you know, as you point out, it's highly competitive by early 26 here. market share and multi-list. And medallions, but I think it's important to point out that we're always very Market share and revenue capture. So we don't see that as a static kind of trade-off. As market conditions change, we'll continuously adjust pricing and incentives to make sure we're maximizing that overall opportunity set for SIBO rather than optimizing for a single metric in a given quarter. So that's kind of an ongoing thing, and it will continue to be an ongoing thing. On the more specific... This is trading during our limited GTH session. You've seen reports of that. That'll be pending regulatory approval later this year. And then another one that I think is important to mention that I'm not sure we've mentioned before, we're engaging with industry participants on The Options Regulatory contract fee charged on option trades to help pay for market regulation and oversight. The train is actually excellent. Fund their regulatory responsibilities, but because As I mentioned, 20 here in the first part of 2026, ORF can be charged by multiple venues on the same cleared trade, which is why it's become really a point of focus. And welcome to the call. We're discussing this ORFRA form and aligning fees more closely with where trades actually Okay, thank you.

Your next question comes from the line of Ken Worthington with JP Morgan. Please go ahead.

Good morning. This is Madeline Daleiden on for Ken. Appreciate your earlier comments on single-name cannibalization risk, but may you provide some more context or help us size the capital efficiencies customers could realize when trading across the new, you know, shorter-duration equity risk management tools, whether it be single-name zero DTE, the MAG-10 index you launched, binary options, when trading in conjunction with the legacy S&P index. Thanks.

Sure. Do you want me to? Yeah, you can start.

Strategy, all of This question comes from the line of Michael Cypress with Morgan Stanley. Please go ahead.

Hey, good morning. Thanks for the question. I was just hoping you could share your updated thoughts on plans around extending trading hours to 24-7 across your markets, what that path and some of the hurdles look like. I know for multi-lists, you've announced to have extended sessions, I think, for certain options contracts. Just curious how you think about overcoming any sort of hurdles around fragmenting liquidity and ensuring real price discovery, particularly in some of those overnight hours. Thanks.

Yeah, Michael, I just want to remind you, so we already trade 23 or 23 and a half by five in futures, index options, and FX for many years. And as we mentioned on this call already through the prepared remarks and Q&A, GTH volume for global trading hours has really grown tremendously. In U.S. equities... Coming in late November. The industry, including our EJX market, would be going to 20. And then to your specific question about 24 by 7, you know, we're already making plans. There's been a lot of talk here about prediction markets and some about crypto as well. So we certainly have capability to trade 23 by 5. We're taking a look at what would it mean for us to extend our clearance.

So just on the multilist, so that goes till 4.15, just curious why not extend a bit longer? How do you think about that? What are some of the hurdles? When do you think we can get to 24.5, 24.7 within multilist?

No, I think it's a great question. Really, you know, we're trying to expand the functionality slowly and deliberately to make sure market participants are prepared, and it's a smooth transition process. Right now, this accounts like these windows where we're expanding. We account for where we see the majority of volume in our current GTH session with SPX. So we don't want to burden liquidity providers right out of the gate having to staff and provide liquidity. You know, traded. This is where we're seeing the majority of the volumes.

Great. Thanks so much.

That concludes our question-and-answer session. I will now turn the call back over to SIBO Management for closing remarks.

Thank you very much. Thank you for joining us today. I just want to take a last opportunity to thank Chris Isaacson. He'll be with us for a while. Thank you for joining us. Thanks, Craig. Thank you all.

Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect.