Nasdaq, Inc. (NDAQ) Earnings Call Transcript & Summary

All right. Hello, everyone. And again -- and another welcome to the UBS Financials Conference, which is virtual this year. For everyone who hasn't seen me yet, I'm Alex Kramm, senior research analyst at UBS, covering the U.S. exchanges, rating agencies, e-brokers services companies and commercial real estate brokers, that's a handful. Anyways, delighted to have up next Nasdaq, CEO, Mike Ptasznik. We really don't have a formal presentation here, so we're just going to do a little bit of a fireside chat and feel free to chime in with your own questions. If you do, I think there's a tool that you can submit questions. I'm happily to -- happy to try to work them in the conversations, which has been working pretty well so far all morning.

So since we don't have no presentation, Mike -- Michael, let's just get started and maybe actually start a little bit more bigger picture than maybe what I would want to ask on an earnings call. And so forget COVID for minutes, I think 3 years ago, it's been now that you announced a strategic pivot for Nasdaq. So maybe just starting off here, can you just give us an overview of what you were trying to do with that and give us a little more detail?

Sure. Thanks, Alex. Well, first of all, thanks for having us here and to everybody that's participating in the conference. Appreciate listening to the story. And yes, very pleased to be here to chat, but thanks for the opening question. So 3 years ago, it was around 2017, we did launch our new strategy. Adena Friedman became the CEO of Nasdaq in January of 2017. So we went into an interim process. And the -- at that time, we really wanted to see what we could do to enhance the growth of the company and accelerate the growth of the top line of the organization, focus on scalability and that really, with the ultimate objective of driving total shareholder return for the company and giving ourselves continue to focus on that as an organization. And so what we did with respect to the strategic pivot is we really took a look at where the industry was going to be heading over the next 5 to 10 years, and we identified the key trends that we saw as being most impactful in the industry. Things like, obviously, the data explosion that everybody has talked about; the changes in the asset management industry, active, passive; and the growth in private equity; importantly, the digitization of commerce with more and more transactions happening online, workflow becoming digitized and that becoming a bigger factor both in general; but also we looked at specifically within the banks and brokers and what they were doing with respect to their operations and what they were focusing and modernizing and all sorts of aspects of their business. And so we had looked at all of those factors, which today, every year, we still obviously revisit that. We still believe that those are the key trends. There's been a couple of other tweaks that I'm sure will come along as we talk about it through the rest of the day. But -- like ESG and some other things that have become even bigger factors than they were 3 years ago. But we looked at all of those aspects and said, "Okay. So that's where the world is going. How can we best position Nasdaq and take advantage of the capabilities that we have to drive that higher revenue growth and that scalability as a business?" And so everybody knows Nasdaq as the exchange in the marketplace, but we also have great assets in our market technology business and our information services and really part of that was shifting focus. So we still contain that great marketplace core but put more emphasis, resources and capital towards market technology and information services where we saw higher growth opportunities overall as a business. And that's really sort of the essence of what we did with it from a strategic standpoint.

Great. Maybe to stay on the topic since you talked a little bit more about the past now and what you did. So where are we now? Where do we stand today? And maybe give us a little bit of a flavor what still may be ahead.

Yes. So as I said, that was about 3 years ago. And I would say the good news is we're very pleased with our preliminary results. We almost doubled the revenue growth from about 4% to 8% over sort of the contrasting periods there. At the same time, we've expanded our margin and have increased our capital return to shareholders over that period of time. And so we feel really good with the initial results that have occurred. But that being said, we're still -- we still feel that there is a long runway and lots of opportunity ahead of us in the space. And COVID is -- some of the things that have happened through COVID with the move to everybody being online and the digitization, that's just continued to enhance the need for more and more commerce and technology and more and more commerce to be done electronically. And so whether it's new marketplaces, whether it's the electronification of workflow, the regtech expansion and the needs within reg technology and financial prime area and all those aspects, which we're focused on with our surveillance business, and then in our information services of providing data effectively and through cloud-based services and SaaS-based solutions, we feel that there is even greater need for those types of products and assets. And so we think that there's still lots of runway left for us to continue to drive growth in the areas that we've identified, and I believe those trends are really going to continue to play positively. Private equity, again, we're seeing more and more dollars going into private equity. And so those are the places that we definitely continue to focus and we see lots of opportunity.

Last one big picture here on that whole strategic pivots. You've obviously acquired some assets to accelerate that growth, but you also divested a few. So when you think about the business portfolio today, still some things that don't really fit or other areas that you feel particularly important to strengthen as you move forward?

Yes. Well, that was a really -- a key piece of the strategy was that we're really focused on our capital allocation. And as I said, we wanted to put more into the areas that we think we're going to grow faster. And we did divest over $0.5 billion worth of assets that weren't growing at that same rate or weren't as strategic or didn't have better margins. And so that's actually a discipline that we've now built into our annual strategic planning process. So every year, we do look at our full set of either new initiatives or products and services that we provide, and we do analyze them on strategic fit and then financial returns. So we -- every year, we'll look at those that are above and below our average margin for the company and above or below the average growth rate for the organization. And then, yes, we focus on where we want to put more dollars, but we also look at the ones that are on the bottom left-hand corner there that are below average margin and below average growth and assess whether there's things that need to be done to address those assets. And from that standpoint, we'll either look to enhance them and put maybe -- see what we can do to fix those things and improve their returns or in some cases, we have divested or we may look at just continuing to monitor those assets over a period of time depending on the nature of them. But so it is part of the annual process. So there will always be assets that we're going to take a look at and that have opportunities for improvement. And that's part of the natural process that we're going to do. So there's nothing specific that we can refer to. Last year, we sold NFX, and we've kind of opened up our services business, but there's different parts of the business that we'll continue to take a look at on a regular basis.

Makes sense. Yes. I think NFX was one that I've asked you over 4 years, and then you finally pulled the plug. So...

Yes. Well, I'll be honest with that. I mean it takes -- it's easy from the outside to just I think sometimes take a look at the portfolio, and we're trying to be more objective like that by doing this process. Like obviously, internally, we think that there's opportunities and we entered these assets for a reason. We want to make sure we give them the runway. And if they're not hitting the milestones, then we look to address them. And each one has its own unique circumstance, and we also have to look at the impact on other parts of the business. And so NFX had some really interesting aspects to it that had relations to certain other aspects. But you're right, at some point, it just doesn't make sense. And so I think the discipline, and it's like a lot of people who are on this call, they look at their overall portfolios. Now we don't look at it as a portfolio because these are parts of our business that we're running, but there are aspects of the business that we want to take a look at and be -- make sure that either improve or address.

Very good. Shifting gears but staying with the same topic. For me, really, it all -- it's all about the organic growth in the nontransaction businesses, which are 75% of your business. What makes you comfortable, and you talked about this a little bit already in the opening, that these businesses -- that business portfolio that you own can grow that 5% to 7%, as you've laid out, in the medium term here?

Yes. I think it does. It goes back to what I said originally with respect to those longer-term trends and that we do believe that those trends are playing out the way that we had anticipated. We have our Nasdaq private market business. We have our eVestment business, which is now focused more on the private equity side of things. There is so much money going into private equity, that's becoming a more and more interesting place. So that's an opportunity set. Within the index business, obviously, we've seen great growth in our indices and smart beta indices, and that continues to be an area of opportunity. Market tech business, which is our highest overall growth segment, again, within market infrastructure companies, but also within new marketplaces and in -- especially within the regtech area where we've seen one of our highest growth aspects within that segment has continued to see lots of opportunity as there's more regulations and more requirements across different asset classes. And so we think that they -- that those longer-term trends or secular trends are definitely in the right space. And then things like ESG, which, again, has come along more from a North America standpoint, obviously, it's been ahead in Europe for years, has created more new opportunities for us in our corporate services side, which we're looking to take advantage of as well. And so that's why we feel that there's a lot of opportunity for us to continue to drive towards that 5% to 7%.

Yes. I definitely will unpack some of those individual business in a little bit more detail. But before we go there, maybe shifting a little bit more near term and the growth, which it seems like it's been better than people feared at first. But can you just talk about what areas you're the most worried about in the near term? And maybe also what areas have been outperforming expectations so far this year, which has been, obviously, a very interesting year that nobody expected?

Yes. Definitely. And so we have actually -- when the 5% to 7% came out into your credit, you were one of the first ones to see that there was an opportunity to be able to achieve or and, in many cases, we've been able to exceed some of those targets that we had set out there. We may have gotten off the train too early, but we'll see that or not, whether that's right or not. But from the standpoint of what we see is we do see those longer-term growth opportunities where in the shorter term and largely around COVID, we talked about this on our last quarterly call about where there's -- there may be some impacts is, yes, specifically in areas like in the investor management industry, there's obviously been a tightening, and people are looking at their budgets and there's some focus there. And so certainly -- and so our investment analytics side of the business, there's been some impact on that piece of the business. It has continued to grow. And again, this is all not about shrinking. This is about limiting the growth that we've been seeing towards those targets. But we had seen some slower down -- slowing down at certain aspects of that business has been one impact that we talked about. On the other side, within the market information -- our market tech business, again, it's thinking from an implementation standpoint or for some new contracting and some of the new market opportunities, there has been a bit of an impact. And again, we talked about that on our quarterly call that the great news about our business, though, is that we do have these offsets in, obviously, on the volatility side, and we're seeing all the uncertainty has been driving huge results on the market services and on the trading side of the business and as well as the index business has been performing extremely well with the Nasdaq 100 hitting new highs and the amount of assets under management keep coming into those. And so that's what's great about the business is that there are definitely balances, especially in times of uncertainty where we have these other parts of the business that can come up and pick up the slack and, in some cases, actually, even generate higher overall growth. And so there are definitely some areas that are -- have been impacted somewhat in the short term, but others are offsetting that. The good news is that, again, going back to us saying earlier, the longer-term thematics and thinking is that what's happening in the short term isn't a fundamental shift. If anything, it's going to be positive for the market tech business in the long term as more businesses are going to want to consider the cloud, they're going to want to go more SaaS-based, they're going to want to have also technologies so that they can handle these types of situations. Hopefully, we never have them in the future, but -- so that -- as people learn to operate in this new environment.

Yes. You just hinted at this already a little bit. Anything else you would highlight where COVID potentially benefits your business? Any sort of new use cases that you hadn't mentioned? And obviously, you have mentioned the volatility and everything, we know about that. We -- that's helpful. And then just one quick one on the downside. Can you talk about retention rates in your various businesses more broadly?

Yes. So I would say the retention rates have been fairly solid, in general. In our market tech business, we obviously have incredibly high retention rates. A lot of those contracts in the market infrastructure, operators are sort of in the 5, plus or minus, year range. And so those are solid long-term businesses, exchanges. If anything, they've been doing incredibly well in this period. And so that's been positive on the surveillance side. Again, those are good long-term contracts. And so those have continued. So very strong in the market tech side of the business. Information services, again, the brokerage industry has been doing well with all the activity. And so that's been positive. On the eVestment management side, we've been moving to more of a different model on -- more of an enterprise model on some of our eVestment. And so retention has been positive from the standpoint of the fact that because we've moved to this more of a enterprise-wide model, it's less about people cutting off individual SIP licenses, but because we have enterprise licenses, more people have actually been using the product within those firms. So the general -- the overall retention has been fairly positive there as well. So there's definitely been some pockets within the corporate services area where people are cutting back on budgets specifically in those industries that have been more negatively impacted like in the travel industry and entertainment and some of those others, the restaurants, et cetera, that's been where there's been some pullback. But in general, I think we've been weathering the storm pretty well.

Okay. So why don't I try to go into a little bit more detail here. Before, by the way, just a reminder, if you want to send in questions, please do it through the web tool. Let's start with market tech, which is I guess the one that you laid out as the highest growth area earlier. Can you give us an update where you're seeing success in both the traditional side of the business, but also some of the new nontraditional customers? And maybe -- and also give us an update on the Cinnober acquisition. I think it's been almost a -- more than a year now, I can't keep track, but where that stands, how that maybe has helped that business move forward and yes, be better for the years to come?

Yes. So overall, again, very pleased with the market tech business. On the core market infrastructure operator side of things, we continue to see growth within current clients and new clients. We just announced yesterday I think that Dubai Gold & Commodities Exchange is taking a full number of different parts of our platform and we're working with them. And so we see new clients coming into sort of that core part of the business as they continue to go from doing things in-house to using outsourced provider and Cinnober is definitely beneficial to that aspect of the business. We have new relationships with a greater number of clients and we can offer a broader suite of services. And so it's really once we're in with the client providing them with, say, trading technology, we can add on clearing and other aspects of the business. So that's been positive where we are selling more to existing clients but still growing the client-based on the core part of the business. And I'd say the same thing on the regtech space as well where we continue to have more. I think last quarter, we announced 5 new sign-ups to our trade surveillance platforms overall. And so there are more clients that continue to adopt our platforms, both within the market infrastructure operators as well as within the sell side. So we continue to see good growth on the core business and our ability to continue to expand out into different asset classes as well as different aspects of the business. So Cinnober helped expand more into some of the clearing aspects into the risk management, into insurance products. So they've brought some additional products, but then also brought us some great talented people that have helped us. As we've been trying to grow the business out, we want to bring in those technologies. So they've been a real -- these are real positive synergies from them. Both on the revenue side, but also on the cost side, they've been able to help fill a lot of those worlds in a very quick time frame. And so it's been about 15 months -- or actually, probably about it's 1.5 years now, if not more, that we've had them. And the results have been very positive by expanding, again, our client base and our product base as part of that. And again, as more and more businesses are looking -- are getting more comfortable with SaaS, are getting more comfortable with the cloud, our NFF platform, which is sort of the core underlying platform, has opened us up to those industries, those players who want to continue to modernize their platforms. And then we, just last month, launched our new marketplace services platform, which is really the ability for any new marketplace to sign up and launch a marketplace in a much simpler, faster time frame rather than having to develop all the code yourself because we're basically giving you a marketplace in a box. So you can be trading and clearing and all the other services around that on a cloud base. And we had our first client on that base, LEX, which is doing something in the commercial real estate market. So I think it's really interesting and exciting, and we're getting opportunities in both the traditional and in new spaces as well.

Yes. And very quickly, I think you mentioned already, obviously, just at the end there with the Nasdaq financial framework. But this whole move to moving clients to that or being more scalable, more SaaS, I mean that transition has been going well. Is there -- can you talk about this? Is it like a book of business? I heard you say before, it's maybe a multiyear period where we see take up. So anything to add beyond what you just said to maybe get some more excited about the trajectory in that business as it becomes more scalable?

Yes. I think I really give credit to the vision that the organization had about 4 or 5 years ago when we first started talking about the NFF, which is if you look at almost every industry now and the move to these cloud-based platforms, the ability is to think that can you do that with something that's as large as a trading platform for the industry of trading and clearing and all those aspects? And the fact that Nasdaq had the vision to go and say, we can take trading and clearing and all that moving on to a SaaS-based platform. So we don't have to do these bespoke installations and all these separate exchanges. It makes it a much more simplified, clean technology stack where people can plug in different aspects of what they're doing into this core platform. And that vision, which is what we've been executing on, I think has got a lot of the -- has been able to help us really win a lot of business because it is the future of technology. It's where all the other industries are going. And because we've been the leader in this space, a lot of our clients within the exchange space I think appreciate the fact that they're moving on to technology that's really future-proof to some degree. And so that's really opened up new sales opportunities, but it's also opened up this concept for new marketplaces like the real estate or like our betting exchanges and other aspects for them to come off of this platform. And so from our standpoint, it's a more efficient and scalable platform, but it's also I think really opens up the opportunities to sell into different asset classes in different areas. And so it's been well received by both traditional players as well as new players as well.

Excellent. Shifting gears then. Information services is the other I guess the data explosion, I guess I think you called it, was the other mega trend that you talked about. So maybe you start with the eVestment business that you bought. And again, always looking for updates on how you've helped these assets that were good growing assets already kind of accelerate. So just maybe touch on that first, but then also what are still the areas where you're underpenetrated, new markets that you go into, you mentioned private equity earlier. So yes, maybe tie that all together.

Yes. So the eVestment, which for those of you who aren't familiar, although a lot of people on this will be because their firms use eVestment, it's a tool between the asset managers and asset owners to share information and provide the asset owners the ability to compare different portfolios, different portfolio managers, et cetera, when they're looking at their portfolios. And I would say there's 4 key growth areas that we see in the eVestment analytics space that we have there. One is continued geographic expansion, which is something that Nasdaq has been able to help eVestment with is that we already had an office in Japan, and they had looked at doing that, but the cost of setting it up, et cetera, was too high at the time relative to other priorities, and we were able to do that. We've won some number of clients in Japan as an example of that. So we'd be able to help expand geographically, but we think there's lots of opportunity to do that. Within Europe, we've had some similar wins. And so we do think that there's continued opportunity for geographic expansion. About 70%, plus or minus, of the revenue is coming from North America. And so we see that there's lots of opportunity to continue to expand outside of that jurisdiction. Number two, within the firms themselves of getting revenue per customer of adding on additional capabilities within the packages that we're selling to those clients. And as I said, we've moved to more enterprise models, but you can move up within those enterprise models by the type of data and information that you have access to and the packages that you have and so growing within those businesses. And that's somewhat been connected to the acquisition that we made of Solovis, which really is a great tie-in with this, which is a portfolio management analytics tool. And there's a great cross-sell effort between those 2 platforms, and now you're part of the workflow on the asset owner side. So now they can look -- analyze their portfolio with Solovis, but also then look at their mandates and do the portfolio comparisons amongst the different asset managers. And so the workflow tool in conjunction with eVestment is really a great combination there. So we see that as enhancing the growth. And then lastly, as you said, private markets. So we're putting a lot in our private equity, and we're putting a lot of effort into the private equity space of adding that data and information, and I should actually add ESG as well, that's to continue to enhance the information and the value of the data that's in those products, which then creates additional product opportunities coming off of them. And so we still think that there's a lot of exciting opportunity to continue to grow with that product.

Great. Well, I'll ask you about Solovis and those other acquisitions a little bit, but staying on information services, clearly, the -- I don't want to say the highlight, but the really impressive growth has been on the index side. You mentioned yourself that the Nasdaq 100 seems to be the place to be right now for the time being. But that's great and we'll take it. But what can you talk about that you are doing to really drive growth in the index business? There are 3 components of it, right? There's the -- there's more than 3, but 3 big ones that I think about is the AUM base side, there's the futures trading and then there's also subscription side that we don't talk about a lot. Any things in particular that you can do there? I don't feel like it's getting attention because it's not that big, but some of the other index companies, that's where they make most of their money.

Yes. And so we have been trying to enhance all aspects of the business. So we've -- on the -- obviously, on the assets under management side, you're right. I think we're very well positioned for the new economy and where a lot of the attention is in a lot of biotech and technology focus there, and that's obviously been a real benefit as we move on through this crisis. And that's been attracting assets under management. People are recognizing just how well the Nasdaq 100 has been doing. But like you said, there's -- that goes -- there are times that goes up and down, but we have some really great interest in the product. And it's really more to, again, the nature of the types of listings that we have within Nasdaq. And then on top of that, we have a very strong focus on the smart beta indices. And so we have somewhere between -- actually, with the growth of the Nasdaq 100 is usually around 40%, but it's kind of around 35% or so now with smart beta indices. And that's an area where we really try to work with the ETF and ETP providers on unique and niche industries. We're -- we know how well some of our competitors and some of the people that I think you've had up today are doing in the index space, but we're looking at this from a niche provider aspect and try to find some interesting aspects and working with them to try and find ETFs that will meet the needs of a certain community and then hopefully, those would grow into larger indices. And so that's the focus that we have is really working hard with the ETP providers on that part of the business. We're also very happy with our partnership with CME on the Nasdaq 100 futures, continuing to launch new products and then when they launch micro minis and other aspects of that. So we're continuing to work with them on product launches. And there are some other opportunities that we have both on the products, but also geographically to continue to expand that part of the business. And then we are looking on the -- as you said, on the analytics side. And then in our investment data analytics, we'll continue to expand out the types of information that people can have access to. And so there are a number of initiatives in that front. But we think that there's still lots of room and excitement within the indices space that we have here in Nasdaq.

Okay. Last one on information services. The proprietary market data in general, any growth left in that area? I think there's pockets of growth that we sometimes forget about. And then you mentioned analytics a few times, anything else you can add there on how analytics maybe still an area to help with the proprietary market data? And then, of course, as I previewed before, maybe tie in some of those acquisitions that you made like Quandl and you already mentioned Solovis and Sybenetix. So to be quite honest, I'm still kind of like new into all these smaller things, so it would be great if you can unpack that because I think the -- that's -- data analytics is clearly where still people see a lot of growth and you obviously are excited as well.

Yes. So on the core proprietary data where we see continued opportunity there is geographic expansion. So there are -- especially within Asia, there are large brokerage firms that are -- that we're now working with and subscribing to our data. And so we have seen some growth opportunity there. It's small relative to the overall size of the pie, but it does provide some growth opportunities. We've also done things, and this ties some of our pieces together, we've launched the cloud data services. So that is a cloud-based data service where people can subscribe to the platform. And that's not necessarily for all the traditional platforms, but it does open up to other fintech and other people who want to access either -- whether it's traditional proprietary data or you can access things like Quandl and other aspects of the information that we provide. And so it's a new distribution vehicle that's very user-friendly. And again, it opens up the marketplace to new customers and new clients of that data. And so that's where we see some of the additional growth coming from within the proprietary data space. On the analytics side, things like -- I talked a little bit about Solovis, and that's a big focus is how can we help support the asset management industry in making their investment decisions? And so on Solovis, again, that's targeted towards the asset owners. Quandl, hedge funds and others who are looking for alternative data and trying to incorporate that within their decision-making, and we're constantly looking at new sources of data that we could add into the Quandl platform and so that asset managers who are looking for alternative data sets can turn to the Quandl platform. We partner with number of firms. We don't try to buy the data ourselves, we partner with others who can bring a variety of information to the asset managers. And obviously, good penetration within the hedge fund community and looking to see how we can continue to expand that amongst more fundamental players. Sybenetix is a bit different. Sybenetix is a part of our market tech business, and that's really market surveillance but for the buy side. And that's a totally separate initiative that we're working on there. And we have seen some traction there as buy side is subject to things like the market abuse rules and other factors, especially within Europe. We see that, over time, more of fincrime regulatory surveillance and the trading surveillance will be a more -- a larger aspect from the buy side standpoint but we would put that in a different segment than our -- than others.

Right. I guess last nontransaction piece that I need to dive into is the Corporate Solutions business. I feel like there's fairly little new things going on, although you do have one report, recent acquisition, right? But yes, just in terms of the core business, any sort of -- you mentioned that there are some challenges there in the near term. But bigger picture, are you taking share? Who are you taking share from? Why you're taking share? And then as I said, with one report, maybe deep dive a little bit deeper to that in terms of cross-selling opportunities in that business in general.

Yes. So our Corporate Services business, which includes Corporate Solutions and our Listings business, I think really importantly that -- we brought them effectively together under one management team now, and we're really seeing the benefit of -- specifically in both of the models, but specifically, the IR advisory tools and capabilities that we have there are really helping from the Listings standpoint. And that's really because the people who are in the IR advisory, they know who's buying and selling the stocks. They've got a lot of good, detailed information about the shareholder base. And so when we go and we pitch companies to kind of list on the marketplace, then the IR advisory is a big part of that pitch. And so as you know, we've been winning overall. With about our 69% market share so far this year, we've been -- even higher than that, if you exclude some of the specs, and we're doing better in specs now as well. So we're making a lot of headway, and we're doing really well within the Listings space of winning around that 70% win rate for a number of years now. And so IR advisory and the combination of our Corporate Services Solutions is really, from a strategic standpoint, a big driver of Listings, which is, again, a good part of the core business. And so that aspect of it has been positive. In addition to that, we're very excited about the capabilities that we have there because as ESG has become a bigger and more important platform, it has been a -- as I said, Europe, whether it's coming here to North America, it's becoming a bigger and bigger factor. We think we are very well positioned. And it has become a natural extension of the services that we've been providing to corporate issuers. We're already talking to them about who their -- to CEOs and CFOs of who their shareholders are, who's buying and selling their stock, who could be their future targeted shareholders. But part of the question is that is Natural is then -- how does ESG come into play? What -- which raiders and rankers are they using? How to best position your company so that the -- you're better positioned in order for the shareholders to be able to be attracted to your company. And so from that standpoint, we think that we've got a great ability to provide advisory services, and that's been one of the growth areas that we've seen. And then in addition to that, we felt that it was really beneficial to provide -- to connect that with a tool that -- a technology tool that allows them -- and a workflow that allows them to get off of Excel spreadsheets and Word documents and put it all into a tool that helps them manage all of their ESG information. From an internal standpoint, it helps them simplify that -- those procedures and to be able to report to all the multiple raiders and rankers that are out there. And so by providing the advice and technology to be able to do that, we think it's a really effective approach. On top of that, we also help them with their corporate financing needs through our green bond offerings that we have in the Nordics, but also our Nasdaq sustainable bond network to help them really promote what they're doing from a financing standpoint as well. So bringing all of that together I think is going to create some really interesting opportunities for us within the Corporate Services space and leveraging all the capabilities and leveraging off also that great platform we have with the governance tool. So our Boardvantage and our Directors Desk tool, the -- those -- the fact that we're already on so many desks of directors, et cetera, we're already helping provide them with capabilities in the governance space. If we can continue to expand that as part of the ESG network, I think we've got a really good offering overall. And so we're very excited about the opportunities there, and we'll hear more about that at our Investor Day in November.

Yes. I mean I asked about -- since we're talking about ESG, I asked about ESG on the earnings call. So is there anything else to add beyond what you just talked about? Because I think it's obviously -- ESG has a lot of different flavor. So anything else beyond the Corporate Services, et cetera, that you want to highlight as you think about yourself as maybe having more integrated opportunities there?

Sure. So again, our -- we think our primary focus is on the corporates. But however, we're a marketplace, so we sit between investors and corporations. And we want to like the concept of bringing those together. And so on the corporate side, we can help provide the types of services that I just described. And then on the asset management industry, through our capabilities and through the information that we have through eVestment, we have a deal with a company that we have something called Nasdaq Footprint, which allows investment managers to help analyze their portfolios. In addition to that, we also have our Index business. So we also are looking to serve the investment management industry. We are not going to go into the ratings and rankings and be another participant in that place, but we do think that we can provide a lot of other services to the investment management industry, leveraging the tools and capabilities that we have in index and information services.

Great. Looking at the time here. Just to round it out, quickly anything -- we haven't talked about the trading side at all, which -- that's fine by me. But -- because there's not so much that you can control, but anything you would highlight there other than, obviously, equity options and equities have been great. But any particular areas that you feel like I'm not getting enough attention on the trading side or that I should be maybe paying more attention to or that you are paying more attention to because there are things to do?

Well, I think, obviously, trading has provided us with the benefits, especially in these uncertain periods. And so we do have that countercyclical -- or not really countercyclical, but we have those benefits within these times of uncertainty. I would say, with also the big influx of retail that has come into the marketplace, it does create some longer-term potential, especially within the option side. So right now, there's been a big focus on the equity side. But we think that there's opportunities to educate those investors, and we're working with the firms to think about the broader aspects, risk management, tools that they could use through the options. And so longer term, we think that this is beneficial. So equity has had a kind of a flat run there for a period of time or, I would say, trading had a flatter run for a while. But now I think with volatility, uncertainty, more participants in the marketplace, more tools and capabilities, then it does create some interesting opportunities to continue to build out that business.

All right. We're almost out of time, but you are the CFO, so I need to ask you a financial question. Margins, expense growth, again, this has been a crazy year in terms of T&E and all these other things. So maybe just help us very quickly unpack what we should be expecting, what new initiative spending is still all about, some of the margin opportunities on the tech side through SaaS? Again, we're on limited time here. So just what should I walk away with on the cost and margin side, which obviously is already impressive?

All right. Well, let me just say a quick summary of this is that our view is that over the long term, if we can grow the revenue, the non-trading revenue in that 5% to 7%, which is our target over the 3- to 5-year period, we can continue to manage our expenses, as we said, plus or minus, in that 3% range that, that should continue to drive the overall organization towards margin expansion over the medium to long term. We are very much, though, still investing in our long-term growth initiatives. We have a number of them, and we've touched on some of them in private equity and in the market tech and other spaces. So we are going to continue to invest in those because we do believe that that's going to drive long-term shareholder value.

I think that is a good place to stop. So thanks again for doing this and thanks for being at the conference. Have a great remainder of the day with other meetings, great end of the summer and hope we'll see you in person next time.

Thanks very much and have a great vacation, too.

Thank you.

Take care.