Nasdaq Q1 2025 Earnings: A Bullish Beat for the Tech Infrastructure Giant

Nasdaq, Inc. (NDAQ) just delivered a blockbuster quarter that’s sending ripples through the financial tech world. The company’s Q1 2025 earnings not only beat Wall Street’s expectations but did so with such force that it’s hard not to get excited. Let’s dig into the numbers and what they mean for investors.

The EPS Beat: A 24% Surge

Analysts were already bullish, forecasting an EPS of $0.76–$0.77 for the quarter. Nasdaq blew past that, reporting a non-GAAP diluted EPS of $0.79, a 24% year-over-year jump. This isn’t a fluke—the company has now beaten estimates in three of the last four quarters, including a 1.3% surprise in Q4 2024.

The strength isn’t just in the bottom line. Revenue hit $1.2 billion, up 11% year-over-year, fueled by growth across all major divisions. Let’s break down the drivers:

1. The Subscription Economy Machine

Nasdaq’s Annualized Recurring Revenue (ARR)—the bedrock of its business—hit $2.8 billion, up 8% from last year. This recurring revenue is the gold standard for stability and predictability. Here’s why it’s so strong:
- Financial Technology: This division, which includes fraud detection (Verafin) and regulatory tools (AxiomSL), grew its ARR by 12% organically. Verafin added 35 new clients in Q1 alone, expanding its data consortium to cover $10 trillion in assets.
- Index Solutions: Assets under management here hit a record $662 billion, with $27 billion in net inflows during the quarter. New product launches (like those targeting institutional insurance annuities) are driving this growth.

2. The Cross-Sell Revolution

Nasdaq isn’t just selling one-off products—it’s building ecosystems. The company’s “One Nasdaq” strategy is paying off:
- Since acquiring Adenza (now part of Financial Technology), Nasdaq has secured 19 cross-sell wins, with cross-sells now accounting for 15% of Financial Technology’s sales pipeline.
- The goal? To hit $100 million in annual cross-sell revenue by 2027. This synergy isn’t just smart—it’s a game-changer in a fragmented financial tech space.

3. Market Dominance and Innovation

• U.S. Equity Volumes: Trading activity soared, with U.S. equity options volumes up 21% year-over-year. Nasdaq’s market infrastructure handled a record 425 billion messages in a single day—a testament to its tech backbone.
• Global Expansion: Nasdaq’s partnership with Amazon Web Services (AWS) will supercharge its cloud infrastructure, while deals like the nuam platform in Latin America are unlocking new markets.
• Listing Leadership: The company welcomed 45 new operating company listings, including high-profile names like Shopify and Thomson Reuters, adding $230 billion in market value to its tally.

4. Cost Discipline and Deleveraging

While revenue grew, Nasdaq kept its costs in check. GAAP operating expenses fell 3% year-over-year to $690 million, with over $100 million of its $140 million efficiency program already realized. This freed up cash for shareholder returns:
- $138 million in dividends and $115 million in stock buybacks.
- Debt was reduced by repurchasing $279 million of senior notes, earning a Moody’s Baa1 rating upgrade.

Risks and the Road Ahead

No stock is without risks. Nasdaq faces potential regulatory hurdles—like delays in rolling out 24/5 U.S. trading hours—and macroeconomic headwinds. But the company’s diversified revenue streams (10% of ARR comes from outside North America) and its focus on recurring revenue buffer it against volatility.

Conclusion: Buy the Dip? Absolutely.

Nasdaq isn’t just surviving—it’s thriving. With $2.8 billion in ARR, a 24% EPS beat, and a pipeline fueled by cross-sells and innovation, this is a company building moats in a digital world. Analysts have an average price target of $86.28, implying a 22.7% upside from current levels.

Investors should take note: Nasdaq’s Q1 wasn’t just a good quarter—it was a masterclass in execution. With its fingers on the pulse of global finance, this is a stock to own for the long haul.

Final Takeaway: Nasdaq’s Q1 results are a clear signal that it’s not just keeping up with the times—it’s setting them. If you’re looking for a tech stock with staying power, this is your play.