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

Good morning, everyone. My name is Ed Ditmire, Senior Vice President of Investor Relations for Nasdaq. Thank you, everyone, for joining us at Nasdaq's MarketSite global headquarters, whether it's participating virtually or joining us here in Times Square, New York City, for our 2022 Nasdaq Investor Day. It's wonderful to see so many of you joining us here in person and logging in virtually. Thank you so much for your time and focus on us today. Let me take a moment to pause here on our legal disclaimers and encourage everyone to open this presentation on ir.nasdaq.com IR website to read these carefully. Now let me talk about a few logistics today. First of all, the program is intended to run 8 a.m. to 12 noon, and then we'll have a lunch on site later or some boxed lunches to go, and we hope some of you are able to join us. The second thing I want to say is that we have WiFi on site. The WiFi network is called MarketSite Guest 2, and the password, in all lower case letters, is rewritetomorrow, one word, that's rewritetomorrow. And it's on the screens here, if anyone forgets it. Now let me review the agenda for today. We'll start off hearing about Nasdaq's strategic direction from our CEO, Adena Friedman. Next, Nelson Griggs will go over the Corporate Access Platforms division. After a 10-minute break, Tal Cohen, will go over our Market Platforms division. Then we'll have a panel discussion on the topic of how Nasdaq leverages specific technologies to elevate growth, that will be moderated by Nasdaq's CIO and CTO, Brad Peterson, and include 4 of our leaders most closely involved in implementing several disruptive technologies into our products and services. After a second 10-minute break, Jamie King will discuss the Anti-Financial Crime division, and then we'll have a panel discussion on the topic of how Nasdaq can add value to our clients during an economic downturn, just in case one happens, led by Nasdaq's Chief Economist, Phil Mackintosh and a panel of business managers, each representing distinct customer segments. Lastly, our CFO, Ann Dennison, will then cover the Financial and Sustainability discussion in the last presentation. We'll have about 10 minutes of Q&A time after each of the divisional leaders' presentations. And then after the final financial segment, Adena and the rest of the management team will be available for an extended 25-minute question-and-answer session. During the Q&A periods, we'll be able to take questions from in-person attendees. And when you signal to us you have a question, I'll ask you to please wait for a microphone to be brought to you so that virtual attendees can hear it clearly before our management answers. Now we're going to kick things off with a quick video, and then I'm going to turn it over to our CEO and President, Adena Friedman. [Presentation]

Well, That's always a great way to start, with a nice video. I'm Adena Friedman, CEO of Nasdaq, and I want to welcome you all to our Investor Day. Thank you so much for coming in person, very different than 2 years ago. We did have some great people here 2 years ago, a few of us, but now we have so many more here today. Well, I'm oh, gosh, let's get the -- I'm trying to speak too loudly and then too softly. Okay. Well, I just want to make sure that we level set what we're going to talk about today. And first of all, we are going to spend a little time looking back to say what are what are the things we've put in place to achieve the success we're currently having at Nasdaq. But we want to spend the majority of our time really focusing on how we are positioning ourselves to continue to grow and expand the business going forward. And so I've got 3 key elements of the presentation I'm going to give today, focusing first on the quality of our franchise today, making sure that you understand our current business and the journey we've been on to achieve our current success. Well, today, Nasdaq is a highly scaled growth technology company with $3.6 billion of net revenues and a 50-plus percent EBITDA and operating margin. We also, over the last 5 years, have really been focused on developing our solutions businesses. They today represent 75% of our total revenue, and we've been able to demonstrate a compounding growth rate of 9% across those businesses over the last 5 years. The result of that has been that we have now an 11.5% return on invested capital for our shareholders, and we've also been able to demonstrate a double-digit shareholder return consistently over the period of time. Now what is the framework that we use to determine what businesses we should be in and how we should serve our clients? Today, Nasdaq is really a scaled business, but our goal and our purpose is to advance economic progress for all. Now how do we do that? We do that through our vision of being the trusted fabric to the financial system. And when we think about, well, how do we do that? Well, our value proposition is to deliver world-leading platforms that improve the liquidity, the transparency and the integrity of the world's economy. Why is this important? These words, why do they matter? Well, they matter because they really serve as the foundation of our culture, and they help drive our focus and our priorities within Nasdaq. I think it's important to note the 3 words: liquidity; transparency; and integrity. Those are the 3 words that really define how we make decisions, the businesses we choose to go in and how we drive our capital allocation as well as our focus towards our clients in achieving our vision and our purpose. Well, as we think back into 2017, we've really been on a journey to get to the point where we feel like we can deliver that purpose, deliver that vision, and we are really on the way to having a great value proposition for our clients. We started our journey back in 2017 with what we call a strategic pivot. We really thought about how can we make sure that we're bringing our capital and allocating it to our highest growth opportunities, how are we making sure that we also are thinking about the businesses we should be in and maybe the businesses we shouldn't be in. So we made some harder decisions to divest of certain businesses that weren't really aligned with our strategic direction. And then we also then leaned in with acquisitions, acquisitions that could really amplify our growth, but also deepen our relationships with our core clients and make sure that we're delivering against the vision that we have for ourselves. So we really -- we focus on establishing the analytics business with the acquisitions of eVestment and Solovis, leaning into our anti-financial crime capabilities with the acquisition of Verafin, and then really growing and expanding our market technology business with the acquisition of Cinnober. Also over the last 3 years, we've also then amplified that even further by really focusing on the ESG needs of our corporate clients with some small bolt-ons, but really coupled with very strong execution on an organic basis. So we've really positioned ourselves now to have these incredible growth pillars that carry us forward. And what have they done for us so far? So far, we feel like we've been able to achieve a lot of great things, but we, frankly, have a lot more to accomplish. But so far, we've been able to double the growth rate of our Solutions businesses. We've been able to increase the margin by 500 basis points. And as a result of all of that, we've delivered a 16% compounded annual growth of our earnings. And we're really, really proud of that. But frankly, as I said, we really do believe that we're still just beginning to achieve what's possible here. One of the things we've also been doing over the last 5 years is steadily increasing the outlook that we can provide to all of you in terms of the revenue growth potential that we can deliver over a 3- to 5-year period with our Solutions businesses. And in 2020, we did that again. And we said that we would deliver 6% to 9% growth in our Solutions segments. We would have a goal for ourselves to have, by 2025, 40% to 50% of our annualized recurring revenues being in the form of SaaS, our SaaS businesses. We also wanted to continue to be able to deliver a double-digit total shareholder return and an enterprise-wide return on invested capital of at least 10%. Well, I think that we've been able to demonstrate a good execution against all of those goals. We've had a 13% increase in our Solutions segment revenues on an annualized basis. We have now 35% of our annualized recurring revenue is in the form of our SaaS businesses. We've delivered a 23% total shareholder return over that period, and then we also now have an 11.5% return on invested capital for our shareholders. So lots of good green checkmarks. But we obviously still have so much more that we can do, and we want to make sure that we help you understand how we believe that we're positioned to continue to elevate Nasdaq to new heights. Okay. So in 2022, we decided to go into a kind of a new strategic review. We do strategic reviews every year. We refine our strategic purpose every year, but we did a deeper dive this year to -- again, to really focus in on what are the mega trends that are going to define our industry over the next decade. And when we thought about that, what are those mega trends that really are important to us and our success? We then said, okay, so that's looking outside in. We then looked a little bit inside. And we said, "Well, what are our strengths and frankly, what are our weaknesses, and making sure that we know how can we lean into our strengths to be able to deliver against those megatrends?" And then lastly, we also focused on, are we aligned ourselves internally, in terms of how we operate our business to be able to deliver against those trends? Are we really -- are we optimized for the growth and scale that we want to deliver going forward? We've had a lot of growth. Are we really making sure that we can continue to achieve that growth with a scalable model? Well, we're going to go through each one of those. So the first is the megatrends. We really examined about probably 10 megatrends that we thought were important to defining the financial ecosystem over the next decade. But we zeroed in on 3, where we believe that we can have a very significant impact. The first is markets modernization. And we want to continue to bring the best technology available to the markets to make sure that we maximize the liquidity of the global economy. We look at really focusing in on cloud, machine learning, digital assets or at least the blockchain technology that underpins that, microservice architecture, all of the things that we think could drive more participation into markets, lower the cost to entry for market participants and create a consistent experience for them all over the world, whether that's in our own markets or in the markets where we serve our clients with our technology. The second is in the development of the ESG ecosystem. It is an evolution. As you all know, I'm sure you all are living it, but it's really going from commitments and words to actions and results. And we believe that between corporates and investors, there's a common goal to try to find a framework that allows them to understand what they need to do to deliver against that as corporates and what they -- what information they need to have to be able to invest into those strategies as investors. And then the third is anti-financial crime. It is a huge issue within the financial system. It's a growing problem, but there's also more and more powerful technology available now to solve that problem. And so really focusing in on cloud and AI as part of that solution is, frankly, a cornerstone of that solution in how we can bring that to our clients. So we decided to organize ourselves into 3 divisions. The first division is our Market Platforms division, really focusing on that markets modernization, with our markets businesses, our Trading businesses in the United States and in Europe, coupled with our market tech business. And so together, we're bringing that together into one division, led by Tal, and you'll hear more about that when he speaks later. How do we think about those together, providing a more holistic solution for our clients? Whether it's bringing more market participants into our market tech clients, whether it's optimizing the private local zone that we've had -- we now have with AWS and bringing some of our market tech clients into our ecosystem or creating a road map for other markets to be able to create those hybrid cloud experiences for their clients, all of that together allows us to modernize markets and enhance and increase the liquidity of the global financial system. The second is Capital Access Platforms, as again, bringing those corporates and investors together, we can be a neutral bridge, an important bridge to make sure that we align the corporates with what the investors need to be able to make more informed investment decisions, but also to make sure investors understand the actions and the efforts that the corporates are taking. The third is our Anti-Financial Crime business, bringing our world-leading surveillance business that serves the largest banks and brokers in the world, with Verafin, which is a fraud and AML detection service that serves 2,400 banks all around North America and globalizing our capabilities in a more comprehensive way. So when we think about what that means in terms of the opportunity in front of us and what we're trying to tackle, we have very large serviceable addressable markets that we're trying to serve with our solutions. And I think that it's also -- I think it's notable to say we have a lot of runway to go in order to be able to really achieve our potential against the serviceable addressable markets. In Anti-Financial Crime, it's a $7.5 billion SAM, and we're about 4% penetrated at this point. That SAM is also growing at double digits. So it's just a growing opportunity for us to solve more problems for our clients. In Marketplace Technology, now that we think about it as an overall ecosystem, we're bringing our Market Infrastructure Technology business, together with our trade management services businesses, to think about both how we leverage our physical footprint and our ecosystem to deliver more for our market participants and our market tech clients, but also how do we think about growing and expanding the role that we have with our market tech clients in their own infrastructure. And so as we deliver more through SaaS and cloud, as we also become more of a managed service provider, the SAM has increased, but also our ability -- you can see we still only have 7% penetration. So we still have a lot of runway for growth there. Workflows and Insights. That's bringing together our IR and ESG services for corporates, together with our analytics business for our investors. Because those platforms, when we think about the bridge we can create, we think about a lot of opportunity. With IR services, they deliver services to our investors -- or to our corporates to help them communicate with investors. And with analytics, they serve and provide insights that allow them to make smarter asset allocation decisions. So together, those are our Workflow and Insights tools. And again, a huge market opportunity of $10 billion, and we're 5% penetrated there. And then lastly, with our Index business. It's a unique business. It's a very nimble, very exciting business within Nasdaq. And again, we're about 17% penetrated against what we believe is a serviceable addressable market in that business. So we have large opportunities. We have a lot of runway for growth, and we do believe that we have leading solutions already to be able to bring to bear, to be able to achieve success there. So what does that mean in terms of the opportunity and how excited we are to be able to bring all of that forward? Well, we have 3 key ingredients that we think are going to make it so that we can really achieve success against the opportunities that we have in front of us. First is the business mix improvements that we've made in Nasdaq over the last 5 years, and therefore, how we're positioned today to continue to deliver growth. The second is how -- within those business -- those great opportunities, how much of that is delivered through SaaS, which is, of course, highly recurring, very stable and also delivers a much, much better outcome for our clients. And then thirdly, how are we unlocking even more potential as we bring the divisional structure and make that a living breathing part of our organization. Well, thinking about the business mix first. So in 2017, we had about 19% of our revenue was generated from our -- what we determined were our higher growth segments. Our Index business, our Market Technology business and our Analytics business, which was the eVestment, Solovis business or actually eVestment back then. So that was about 19% of our revenues. Well, today, we actually have added a couple of incremental pillars to those growth businesses with our Verafin acquisition, so our anti-financial crime capabilities, as well as by expanding the Analytics to look at both the corporates and the investors. And those are now growth businesses for us. Our Corporate Platforms business has done a spectacular job of really developing and enhancing our IR and ESG services so that they become a real growth driver for the business. So IR and ESG, plus our Analytics business now is Workflows and Insights. And then we also still have our Marketplace Technology business. Well, that now represents 42% of our revenue. And so we believe that we still have this wonderful opportunity to continue to accelerate and advance our growth on the back of those higher growth opportunities. But we also are really focused on how we deliver those services to our customers. And we've been migrating and making sure that more and more of what we deliver is in a SaaS format, and that we're turning ourselves into a SaaS company. Now in 2017, we had just under $250 million of SaaS revenue. Today, we have just under $700 million of SaaS revenue. We also talked to you, back 2 years ago, about the fact we want our SaaS revenue to become 40% to 50% of our annualized recurring revenue by 2025, and we are on pace to do that. We're now at 35%. We still want to be able to deliver greater than 40% by 2025, and we believe we can be even greater than 50% by 2027. So we're adding that as now a new 5-year goal for us. Additionally, as we start to operate ourselves and think about ourselves as a SaaS business, we need to start to measure ourselves as a SaaS business. So we are starting to introduce to you some new metrics that we're going to provide on an annual basis that allow you to have a little bit of insight into how we're doing as a SaaS company. So just as a starting point, we're going to provide you with gross retention, non-GAAP gross margin and our progress against what we call the rule of 40. The rule of 40 is the revenue growth rate of the businesses, combined with the margin -- the EBITDA margin of those businesses. You add those 2 numbers together to get to, hopefully, a number close to 40. So right now, we are at 94% gross retention across all of the SaaS businesses that we operate. We have about a 72% gross margin, and we're delivering 38 against the rule of 40. So it's a really great starting point, I would say. Now how we want to make sure that we make progress, that's up to us to be able to demonstrate to you over time. But now you'll be able to start to measure us on an annual basis as we continue to progress ourselves as a SaaS company. The second -- I'm sorry, the third thing is the realignment of our organization, and I already went through the divisional structure. But if I think about -- I'm actually going to go from bottom to top. What I really think about is, first of all, how are we operating as a business? We've been doing a big progress -- we've been making a lot of progress on our agile transformation here at Nasdaq over the last several years. And as -- when you think about an agile orientation to delivering for your customers, you really think about product development, product marketing, product management, sales, all of that being a combined effort in a really seamless organization, getting everyone close to the customer so they can deliver better for your customers. Well, as a result, we're bringing our product development and our software engineering teams that support the divisions as well as the product marketing teams and support divisions, we're bringing those now into the divisions. They will be part of our divisional framework. That allows those individuals and those experts to be closer to our customers, to continue to be very nimble in delivering for our customers and still allowing us to scale and grow really successfully within the divisions. The second thing is that we want to make sure we're allocating our capital on our biggest growth opportunities and particularly against the megatrends that we've been discussing. The third thing is we also are really focused on people, process and systems that deliver the client experience. So we really continue to invest there, and we will continue to invest there. We're -- I would say, still early days in modernizing how we or sales people process systems, how we're focusing on our client service people process systems to make sure that it's as modern as possible, that our clients are feeling like we have a really well-oiled machine across everything we do. And as we think about that at the divisional level, that's a new challenge and a new opportunity for us to even do more for our customers that way. And then lastly, of course, is to deliver more strategic solutions to our customers. This is all about the customer. How can we find new opportunities to do more for them? How can they feel like they're a partner to us and make sure that we are helping them achieve their goals against the megatrends that we've identified? Well, what does that mean though for the growth outlook for Nasdaq? Over the last 5 years, we've consistently improved the growth outlook of our Solutions segments, and we're doing that yet, again, today. We believe that over the next 3 to 5 years, we should be able to deliver an annualized growth rate of 7% to 10% across our Solutions businesses. And when we look at that in the context of all of the different metrics that we want to use to define ourselves, we have 7% to 10% growth in our solutions businesses. We have a 50% -- hopefully, to get to more than 50% of our annualized recurring revenue becoming -- in the form of SaaS -- from our SaaS businesses. And then we also want to continue to be able to deliver at least a 10% return on invested capital for our shareholders. But also, we're adding that it should be in excess of our WACC. Our WACC is -- as every WACC has gone up over the last several months with the increase in interest rates and the volatility in the markets, we're going to look at it as both a combination of greater than our WACC and at least 10%. And if we do all of those things successfully, we believe that we can continue to deliver to you a double-digit total shareholder return. So to sum it up, we have strategically pivoted the company and improved our performance. But we also feel like we're now really, really well positioned to capitalize on the largest secular growth opportunities in our space. And we want to make sure that we're starting with a strong position. We have differentiated solutions. In many cases, they're truly world-leading solutions to deliver for our customers. And now with the divisional alignment, we'll be able to do that in a more strategic way. And we believe as a result of that, we should continue to be able to elevate the growth potential of the business. So I just want to make sure that you hear for me that we are so excited to have you here. We're extremely excited what we can do over the next 5 to 7 to 10 years to continue to redefine our space, redefine our relationships with our customers and bring them into the future. And hopefully, over the next 3 hours now or 3.5 hours, you're going to hear even more from all of our leaders to make sure that you feel that we have great confidence in our ability to execute. Thank you very much, and I'm now going to hand it over to Nelson.

Well, thank you, Adena. And I'm Nelson Griggs, and I look forward to discussing the Nasdaq's Capital Access Platforms division with you all this morning. So as you can see with the agenda here, I want to begin with our strong franchise. If you take a look at this division's financial performance at a glance, we've had very, very strong annual reoccurring revenue growth that's made up of a significant amount of annual reoccurring revenue, coupled with high-quality Index AUM and really, a terrific, terrific margin. So we believe the division has a very attractive financial profile. I want to take a quick moment to talk about how our division supports the strategic framework that Adena just highlighted. We also have, in our division, a new purpose, vision and value proposition that my team is really, really excited about. And I want to call attention to the vision of really being a trusted partner to our clients as they make informed decisions. That trust is something that we have earned at Nasdaq over years and years of working with our clients. We truly think about it each and every day. And you'll hear a lot about that as I talk through the presentation here, because it's allowing us to do more and more with a rapidly growing client base across this division. So who are our clients? Well, this division sits at the intersection over 15,000, 15,000 corporate and investor clients all across the globe. And as the division came together, we thought about who our buyers are. Well, they are really the key strategic decision makers with inside organizations. And in many, many cases, we work with multiple personas inside a client, and that leads to very deep and sticky relationships. So within this division, we recognize there are several key secular trends impacting both corporates and investors. Adena highlighted a few. Clearly, ESG is on that list, but also the need for more digital workflow. So this division sits on a lot of data insights that impact both corporates and investors. So we believe our key opportunity is to accelerate our product growth and introduce more products to our clients that they're asking us to do as well as think about cross-sell and upsell opportunities. So we think we have a lot of opportunity to expand what we're doing with our clients. We're doing a lot today. So this slide I wanted to show you here is really the segment breakdowns and what we are doing with our client base as we focus on really, marketplace transparency and supporting our clients' critical decision-making. So in these new reporting segments, we have our core Data and Listing business, which is truly world-class; there's a growing Index business that's unique, differentiated with a lot of new products coming to market and a lot of diversified products; and then on the right, as Adena talked about, our Workflow and Insights, that's comprised of our software in analytic tools, advisory services across both corporates and investors. And they really work with clients each and every day to help them make critical decisions as well as communicate to their key stakeholders. So the summary of these last 2 slides, we have a rapidly growing client base across the entire world, and we're doing more and more with them as we think about how we can service them and help them really achieve their goals. So if we take a look at how we performed since the last Investor Day, we believe we've had very strong financial performance across really every metric that you want to measure. But I want to call out some of our key accomplishments. We've had a lot. But they both focus on this idea of having more products in market and thinking about each client and how we can do more with each client. So the 2 I'll highlight here was we've introduced 80 new ETPs in the last 2 years. That's at a far, far more rapid pace than we have done historically. And then within our public corporate client base, we have a 29% increase in the clients using more than one product. So although these are just 2 examples across every product we have, we're thinking about what's next, what are our clients asking for, and then how is each and every client taking advantage of all we have to offer? So looking at a bit of more long term, we believe we're very well positioned for financial success when you look at our financial metrics. So we've had strong annual revenue growth across the last 6 years. We also have a gradually expanding margin. If you look back in 2018, the margin came down some due to the investment acquisition. We've gradually built that back up, and we have increased operating income on an annual basis of 14%. So again, I think very strong, both short-term and long-term performance across this division with a lot of opportunity to continue this trend. So now I want to move to some of the key strengths and how we are across the various reporting lines. So as mentioned, the Listing and Data business is foundational and really world-class. In the Listing business, you see across really every measure we're taking market share, both in the U.S. as well as in Europe. The new listing market is clearly not open at the moment, but we do believe we're very well positioned to continue this momentum when that time does come, when the market opens back up. In the Data business, we are delivering premier content to over billions of users on a daily basis through a wide range and expanding range of APIs and as well as partner applications to deliver a frictionless experience to the end user. And we are finding more and more clients across the globe and demand for -- have demand for our data services. And we are introducing a lot of new and onboarding new unique data sets that are driving more value to the products we offer today. So the combination of these businesses has resulted in a 7% annual revenue growth over the last 6 years. Taking a look at the Index business, we are leveraging an amazingly high-profile brand to drive what is exceptional long-term growth. What we're demonstrating here is that across the entire world, our brand, our products and what we believe are our unique partnership capabilities are in very, very high demand. We also have a truly, truly incredible team that's building unique products for a growing group of partners. And this whole slide is meant to represent that we have this great foundation that we believe we can build upon to do more and more of this business. But it has had a pretty amazing 25% annual revenue growth rate over the last 6 years. I want to dig a little deeper in some of the competitive statistics. So if you compare us to the 3 largest competitors on an annual revenue growth, we believe we have far outachieved the industry peers. And looking at the average annual organic net inflows, we're averaging 15% in the last 4 years. And then the growth and interest in our futures products that are tied to all these offerings has truly been fantastic. So across the board, this is a really, really strong franchise that we plan to capitalize and do more with. So now I want to turn a bit to our Workflow and Insights business and give you a little bit more detail about who these clients are. So this division is focused -- or this segment is focused on transparency, and digital workflow across a really expanding global client base. Looking at the asset owners, we're working with over 740 of the larger asset owners in the world. These are pension funds, funds of funds, family offices, endowments, a really big market to go after, as well as over 1,000 asset managers using our platform as well. In addition to that, we have over 6,500 corporate clients, leveraging our corporate services solutions, and about 40% of those are Nasdaq listed and 60% are non-Nasdaq-listed. So what we're doing in this group is delivering, again, really critical software solutions, bringing insight data, communication to our -- we help them communicate with their stakeholders and clients. And it's not really a straight line going from asset owners to managers to corporates, but all of these clients care about what each other is doing. So again, we sit on a lot of unique insights, trend data that's allowing us to go to market and think about how we can do more with these client bases. So now I want to turn to a video, and I'm going to give you a quick look at how a client is leveraging Solovis. [Presentation]

This is really focused on helping our clients achieve their strategic outcomes. So there's a lot of resiliency. We become part of a client's fabric and their workflow. So that, in our view, leads to, again, a very sticky business. And as you look at how it has performed in this segment, really, the top line here is we have a growing client base across both corporates and investors at a pretty substantial rate. And they like working with us. So we have really world-class NPS scores, Net Promoter Scores, and that's driving a lot of retention and stickiness with our clients. So the results have really been -- we've seen the reoccurring revenue growing through mostly SaaS offerings. And as we introduce new products, we get very strong uptake because we've done a lot of the work to understand what do they want to receive from Nasdaq, how they find value in what we provide, and then we think we have a world-class involvement team to deliver those products. So the results have been a 15% annual revenue growth over the last 6 years in this business. So now you get one more video. This is going to be one of a corporate client, and really demonstrates the flywheel effect of what our offerings provide. [Presentation]

All right. So there's 2 of our 15,000 clients there. But I think this last one really demonstrates, talked a lot about that crossover of corporate needs and investor needs. And that's really the opportunity this division has to capitalize on all these opportunities that are in front of us. So I want to now turn to our 3 key areas of focus as we think about '23 and beyond. Before I get to the 3 key areas, I'll revisit what Adena covered in the SAMs, serviceable addressable markets, that are in front of us. Both Index, and Workflow and Insights, and we have a new corporate-wide ESG theme that I'll talk about in this section here. But both Index and Workflows have their own sizable SAMs that we're going after. But there is a component in each one of ESG that I'll -- I'm going to go, again, into a bit more detail. And on ESG, we wanted to particularly call this out to show you, through the lens of how we see the SAM and why it's a very big opportunity for Nasdaq, across Index, our Workflow and Insights as well as our carbon market, Puro, that my colleague, Tal, will talk about a bit later. So we have very big markets we're going after. And in addition to that, we believe there's really 3 key industry secular trends that are directly lined up with our market position as well as our products. And that's really this continued and rapid acceleration of passive growth. We see all of our clients across corporates and investors have an increasing demand for more digital automation and workflow as well as partner consolidation, that's a big one. And then we also look at ESG as a strong need across corporates and investors to have a bridge and really find a path towards transparency and efficiency. So if I take a look at the first priority, and we have talked a bit about Index and the prominence of this raised brand and franchise that we have. And we're now in more of a position than ever to accelerate the pace of new products. So we have a lot of plans around thematic indices. We think there's plenty of room to run as well in expanding the Nasdaq franchise. And across every partner we're working with, our clients are asking us to help them take advantage of this growth in ESG opportunities and managing their clients from more ESG products. So we believe in having -- if we can have more products in market, continue to work with this amazing partnership group that we have, we have the ability to continue to be an industry leader in this segment in terms of growth as well as further diversify the business. So now I'm going to turn to priority #2, which is our expansion of Workflow and Insights. So this business, again, is -- I go back to that word, trust. We have such trust with these 15,000 clients, and they do ask us regularly what more we can do to help support their efforts. That's where ESG was born out of. But we have a lot of deep insights, and we're able to, we believe, to position ourselves to be that partner of choice and think about how we're upselling and cross-selling our clients because we developed a lot of new go-to-market muscles over the years across sales, marketing, client success. And our goal as a division is really to operationalize that across the entire franchise. So we're focused a lot on the upsell and cross-sell opportunities, but also driving new logos. We have a lot of opportunity to that in the U.S., but also even more so in international markets as we look to expand there with all of our products. So our view on this segment is we have client trust. We have a lot of capabilities to upsell and cross-sell. We've been driving higher retention rates over the last handful of years and then really attack the new logo market. So we believe when we do this, we're going to maintain our double-digit growth, and we position ourselves as a partner of choice for our clients for years to come. So turning now to ESG. At the Investor Day 2 years ago, I want to revisit our progress from that time. We were really at that point, solely focused on the corporate opportunity. and we had most of the revenue coming from advisory service in a very, very small handful of software clients, very small. And there was about $5 million in revenue at that time. If you fast forward now, we have grown the revenue over 4x in the last 2 years. We continue to focus on the advisory clients that, year-over-year, we grew our client base by 35%. But in addition to that, we're working with now over 170 clients with our software applications. And that's growing very rapidly. So we're well on our way to achieve that goal we set out 2 years ago in the corporate landscape to hit a $50 million target in 2025, because there's really some very strong demand across -- I'd say, the entire client base. We have a lot of clients who are at a different sets of their life cycle in terms of thinking about ESG, but they're all focused on how they can collect, aggregate, analyze, measure and then report out to their stakeholders' ESG information. So it's also -- there's a lot of demands that are coming from investors, the rating agencies, and we see some tailwinds also potentially coming on the regulatory side. So we think there's a lot more we can do with this business as we -- you may have seen in the news, we had a -- one report was our first application. We've added a service called Metrio. So we really have this multi-solution platform to serve our clients. So now turning the page, we're going to get a bit more ambitious with this market. And I want to reset the corporate number a bit as we've had these last 2 years, we have seen our governance solutions suite grow, and the G is a very important part of ESG. And we're finding more ways to integrate that offering with our ESG discussions. So we felt it was natural to start including that product line inside our numbers for ESG. So if I reset that $20 million, today, it's about $112 million in that combined business. We believe over the next 5 years, having a new target, we're going to increase that to $250 million. And that is really made up of a continued focus on the corporate market, but we are also seeing the same kind of demands of collecting, aggregating and reporting across the investor landscape. And we have a lot of inroads there with our clients. So those are going to be thought of the same way, how we help clients collect, aggregate and distribute data out to their stakeholders. As we also look at an opportunity, you're going to get to hear more from Tal on, with our carbon market Puro. As more and more clients every day discuss their goals for net zero, we believe this is obviously a long-term play for us, but we have a lot of opportunity with this marketplace with all of our corporate introductions to add that as a solution set as we talked about helping clients achieve their strategic outcomes. And lastly, I'll just -- I'll mention that the Index business, this is a new area that we're really focused on with ESG. We're getting a lot of our client base asking us to create thematic indices around ESG and also take some of our core franchise and have ESG opportunities within those. So overall, we think, as mentioned on the big megatrends that Adena highlighted, ESG is one of those. We think we are uniquely positioned to capitalize, really being at a neutral point between both investors and corporates. And that's, again, one of the real big benefits of the division coming together. So how are we going to measure success over the medium term? If we look at the various characteristics of each reporting segment, the Data and Listing business, taking into consideration the market we're in today, a low single digits growth rate. The index business is mid- to -- or low to mid-single digits -- well, sorry, mid- to high single digits. And the Workflow and Insights, high single digits to low double digits. So this will translate into a division level 5% to 8% growth rate target. So in summary, we think we have this amazing franchise that is ripe for expansion because the client base is growing. The division is aligned around very key secular trends, and we have clear objectives to grow our offerings, to capture large markets and do more with their client base. And with that, I'm going to open up to questions. And I'm going to have 2 of my colleagues join me here. Oliver Albers is in charge and running our investor intelligence businesses, and Jeff Thomas is taking over for the -- on the corporate side.

Let's go, first question, Rich Repetto.

I guess the thing that jumped out was the increased growth rate from $112 million, so you're more than doubling revenues in this space. And I know you're incorporating governance solutions in there. So do you need any -- what else do you need? Do you need any acquisitions? To me, it's the biggest goal that has come out of Nasdaq in a while, and I think the double revenue...

It's a massive opportunity. And what you saw here was largely organic. There could be some need for additional data sets. We constantly look at the inorganic landscape, and there could be bolt-on opportunities. But today, we have done some smaller acquisitions. There's a lot of, I'd say, niche players out there. But we believe with our brand and the products we have today, we can really capitalize on that opportunity that's there.

And can -- any more detail -- could you include like how many organizations? Any more metrics to get to $250 million?

In terms of?

What you're doing with ESG now and I guess...

Yes. Well, listen -- yes, no, I appreciate the question. We're not going to break out the individual goals per product line. But if you look at the -- I think the biggest opportunity in front of us is where we sit with corporates. So every corporation out there today is looking to automate this process. They're getting more and more demands from rating agencies, individual investor groups and fund managers or have their own ESG strategies, asking corporates for information. So if we can act as that bridge, the software to help the clients really -- it's a lot to collect, it's a lot to analyze, they're looking at having KPIs. I think Adena mentioned, going from really, hey, we'd like to do something in ESG, to now, we actually have to prove we're doing something with ESG. And particularly, a catalyzing event would be if there's regulatory requirements coming from reporting side. So the largest opportunity today is corporates. Then you start to think about all that data we're capturing and how that can flow into Index opportunities and ways to support the investor side. It's a pretty unique flywheel opportunity.

Great. Next question, Gautam Sawant.

Can you talk about some of your international opportunities to expand listings, and if you can generate some flywheels in other countries? And are there opportunities to have dual listings with other regional exchanges?

I'll give that to Jeff to take.

Sure. So I think as we look at the international opportunity, we do have a few headwinds with especially some of the laws and regulations around Chinese listings specifically, but we seem to have seen some positive progress on that recently. But we do see strong demand from other emerging markets. Like Southeast Asia, we've seen very strong demand and have good working relationships with the exchanges there. And I think that's one of the benefits of the market tech business that we have, is we get to know those exchanges at a technology level. So it gives us a really unique opportunity to partner with them.

I'll make one more comment on that. If you look at our -- the Corporate Services business, I mentioned that only 40% of the clients today are Nasdaq listed. So we do sell these products globally. And that's a real key area for international expansion, is how we think about how international clients can leverage. They're very focused on ESG, obviously, the same IR, Investor Relations needs, and then even really, as they focus more on governance throughout the world, we have products that service them as well.

Next question, we'll go to Alex Kramm.

On one of the slides, I think it was Slide 36, one of the squares had a -- you mentioned a 30 -- sorry, 75% increase in enterprise license clients. I think it pertained to market data. Can you just talk about what you're doing there? I don't think you mentioned that actually in your prepared remarks. Where exactly you're doing enterprise license clients? What it changes in terms of does the retention rates improve? Is your pricing power better? And is this early days? Is it a new strategy or is it already fairly penetrated?

Oliver has quite a few years in the Data business, so I'm going to turn that over to Oliver.

Yes. So I've been doing this a long time, and it has been a strategic focus of ours to move more and more clients to enterprise licenses. It just provides them more and more efficiencies in terms of what they have to do to manage the data, how they count. So it streamlines their operations. It also makes for a much stickier product, and that -- we don't have kind of the variability in our revenue as reporting comes in month-over-month. So it's a much more stable revenue profile. And so yes, and we like long-term partnerships with our clients. And so we've seen increase in enterprise licenses, both domestically. But really where our growth has been over the past few years has been internationally.

Is there still space...

Yes, there's still opportunity.

All right. Next question will go to Alex Blostein.

Question on the Index business. You guys talked about a mid- to high single-digit organic revenue growth there over the medium term. Just a couple of questions on that. I guess, one, is it fair to assume that you guys are assuming normal market returns for equities of around 8-ish percent? But more importantly, as you think about the bigger like established franchises you have within Index, which is the Qs and a couple of variations of that versus the new products, what's that breakdown as you look forward between the old and the new?

Yes. So Oliver and I might split this one. But if you look at the -- what we report in the numbers there, the growth rates, that's really assuming a normal market. Obviously, if we have tailwinds, we have upside there. But in terms of the breakdown, we have had -- maybe I don't know if we'll give the specifics, but we are focused a lot on the thematic indices. We have this amazing demand for the Qs, and we find more and more ways to leverage the Nasdaq 100. But there's also just a growing percent of the thematic indices that we're focused on. But why don't you...

Yes, I think that's a pretty good summary. So generally, the Nasdaq 100, we have the opportunity. That's kind of the tip of the spear in terms of how we grow internationally. We kind of start there, and then we build other products with partners on the back end of that. We do see huge opportunity to continue to expand kind of in different forms of the Nasdaq 100. So we have the innovation suite that we recently launched with Invesco. We have yield-generating strategies as well kind of based off the Nasdaq 100. So we see huge product expansion opportunities just with the Nasdaq 100. But then outside of that as well, as Nelson mentioned, we see a huge amount of opportunity with ESG, other thematic indexes, et cetera. So I mean, we're bullish overall in the Index business in terms of how we can support our partners and leverage the growth in past investing.

Great. And have time for one last question in this segment. Let's go to Craig Siegenthaler from Bank of America.

Nelson, you guys have this great strategic organic growth funnel with the listings business. Now if this kind of market extends and it stays closed a little longer into next year, how do you see that impacting your growth targets?

Yes. If you think about this business and where it was, let's say, 5 years ago, it was a listing business and really a lot of onetime offerings inside Corporate Services. We've grown the Corporate Services piece pretty dramatically. And now -- so the entire business now is mostly made up of reoccurring revenue with a very small percent of onetime. So there's a reoccurring theme, but we look at the pipeline of companies -- when they go public, we can't decide when they go public, of course. We want to win those when they do go public, and we're winning our -- greater than our fair share, let's say. But the biggest opportunity we have in front of us, and I mentioned this a few times, is with 10,000 corporate clients that we work with today, how can we do more with them? We've introduced us just 3 new products over the last 2 years on ESG, but also on governance. And we think there's actually more to do there. So I think our biggest opportunity is, again, doing more with our current client base. It's as big as it's ever been.

Okay. Thank you, everyone. Thank you, Nelson and your team. We're going to take a quick break here, and we're going to restart promptly at 9:05. [Break]

All right, everyone. Welcome back. Thank you, everyone, for taking your seats promptly. I'm going to turn it over now and introduce Tal Cohen, Head of our Market Platforms.

Thank you, Ed. Good morning, everybody. All right. I plan to cover the following topics today, and I'm going to get us started by providing an overview of our new division. As you can see, we operate an incredible set of scale businesses that generate strong margins and significant recurring revenues. We also hold leadership positions across many of our foundational businesses. So let's take a look at why bringing together these businesses creates a powerful new division. The new divisional alignment is going to unlock incremental growth by enabling us to lean into key trends, deliver more of Nasdaq to our clients through our shared and collective experiences, expertise and capabilities, and it's going to supercharge the cross-pollination of product innovation between Marketplace Technology and our Trading businesses. Ultimately, this new divisional construct will accelerate our ability to modernize markets and better partner with clients as they transform theirs, which is a great segue into our strategic framework. The key message here is that market platforms will drive economies followed by modernizing markets. And how we'll do it is by architecting and operating the best markets in the world, whether that's been home to the largest IPOs, managing the largest index rebalances or powering national exchanges. So before I dive into how we're going to execute against the strategic framework, let's take a look at how the division has performed over the past few years. What's great to see here is that our annual recurring revenues have kept pace with overall revenue growth during a period of time in which we experienced record trading volumes and revenues. And by running our businesses the right way, we've been able to generate strong operating income and showcase the operating leverage across our business. Let's take a look at some of the key initiatives that we're really proud of here. On the left, you can see that our Nordic equities Trading businesses have outperformed their exchange peers in attracting lit trading. And that's important because lit trading makes up a significant portion of our transaction revenues. And the key reason behind that has been the ability to leverage our best-in-class trading technology to enable clients to better manage risk, and drive price discovery. On the right, what we're showcasing is our U.S. equities and U.S. Options businesses have grown their relative share of transaction revenues over the last couple of years during a period of time of intense and heightened competition. And we've been able to do that by focusing on high-value customer segments such as the buy side and better balancing market share and capture in a manner that maximize the revenue potential of these businesses. All right. Let's take a look at some other specific initiatives I want to highlight. And I'm going to call out just a few that are not only responsible for the performance highlights that we're so proud of, but that are going to catalyze future growth. A great place to start is with the migration of our second options market onto a new global derivatives trading platform, Fusion, along with AWS Outposts. It's the third market we moved onto Fusion and the first in the cloud. And it's extremely early days. We're in day 2, but customer feedback has been really positive about the systems performance, and we're excited about the flexibility that the cloud offers us. And a key reason for our ability to grow Trading revenues in the future has been the launch of new products over the last couple of years. A great example of that has been the expansion of our Options product, especially in our proprietary product space. Over the last couple of years, we've introduced XND, which is a micro product that targets retail investors off the back of NDX and VOLQ, a volatility product that enables asset managers to more precisely hedge the underlying investments in the Nasdaq 100. We'll also continue to grow our NDX product, which is our flagship product, by providing tools that enable investors to construct trading strategies to incorporate NDX into their portfolios. As a result of these combined efforts, we've increased institutional adoption by more than 30% year-over-year. Let's transition into why Market Platforms is poised for continued growth. And I'm going to start this section with a short video from Goldman Sachs in which they share their perspective on the opportunities to partner and collaborate with Nasdaq. [Presentation]

All right. Beyond being inspiring, what stood out to me from that video is Goldman's view that technology is going to power innovation and the key role that we can play in helping them realize their vision for modern markets. So having established the leadership position in adopting and integrating advanced technologies such as the cloud is going to enable us to have deeper partnerships with our clients where we can showcase our experience and expertise. It also positions us to solve more of their problems, unlocking upsell and cross-sell opportunities. And Goldman Sachs is not alone. Many of our other clients are looking for partners to lead them into the future. So our ability to find ways to work with our clients to help them drive growth and manage cost is critical. And that's a great segue into the market opportunities we have for Marketplace Technology. So what you see here are the key trends that are going to drive our growing share of the $3.3 billion opportunity, and I'll highlight just a few. Over the past few years, a number of marketplace technologies clients have delayed investments in infrastructure. And as they come out of the pandemic, they realize that the world has advanced materially. And that's requiring them to consider larger and more transformational investments to keep pace with the clients' evolving needs and the competitive landscape. We've also seen growing demand for institutional-grade solutions across the full trade life cycle, in particular, across new markets, and we expect that to continue as more traditional players enter those markets. And finally, there's a growing market for real-time risk management in light of regulatory scrutiny around liquidity and capital management as well as some of the events we've recently seen in the market. And we're really well positioned to take advantage of that growing market and serve that growing market as we have a best-in-class, cloud-based, multi-asset class, real-time risk trade product that can serve both the buy and sell side globally. Let's take a look at the expanding opportunities for our Trading businesses now. On the left-hand side, what we're highlighting there is the steady increase in the options to equity volume ratio over the past 2 decades. And what that reveals is a secular expansion in options. And we expect that to continue even as volatility stabilizes because of the significant improvement in education, tools and access afforded both retail and institutional investors. On the right side, we're showcasing the key drivers that ignite the flywheel between our Listings and Trading business. For example, the outside growth in the number of Nasdaq-listed shares outstanding, which is 72%, a remarkable number, is going to fuel the future growth of our closing auction, where we have a really strong capture profile. And we see this similar flywheel in the Nordics where our Trading businesses continue to grow off the back of a very strong listings business. In part, it's been fueled by the strong and growing ownership of equities through Nordic households, which happens to be one of the highest across the globe. All right. So it's easily why we're excited about our foundational businesses and the growth prospects, but it's time to turn our attention to our strategic priorities. And there are 3 that I'll cover today. The first is how we're going to optimize our Marketplace Technology business, then I'll talk about how we're going to modernize and transform the markets we operate as well as those that we serve, and then I'll talk about how we're leaning into new growth pillars in digital assets and carbon markets. Let's get started with our plans for Marketplace Technology. The team has recently put a motion of plan designed to yield sustainable growth that has the following key elements. We're going to reduce the number of overlapping products in our portfolio. For example, we'll shrink our core trading product portfolio by half over the next 5 years, that will increase our scale and lower our cost; we'll adapt agile more broadly across the organization to improve delivery and the quality of complex software solutions; we'll standardize the client onboarding process across SaaS and managed services; and we'll bring on third parties who have expertise and integration and testing to yield flexible capacity at a lower cost; and then finally, we'll look to leverage our strategic partnership with AWS so that we can better support our clients on their journey to the cloud. Ultimately, this transformation of Marketplace Technology will provide us with the opportunity to be the leading solution provider that underpins the fabric of markets. Let's move on to our second strategic priority. Here, we're taking our markets as well as the participants we serve on a journey to create a new and more valuable market ecosystem. And we'll do so by working closely with AWS to expand our infrastructure services, deliver powerful new cloud services, offer greater resiliency and portability across the ecosystem and empower customers to take greater control over the services they consume. Ultimately, what this will yield is greater liquidity and create new centers of gravity in the capital markets ecosystem. And then this blueprint can be leveraged by Marketplace Technology to advance their existing clients and power new markets. To make it tangible, just an example is what we're doing right here in North America in our Carteret data center, where in a not-too-distant future, we'll be offering our clients access to the private local zone that AWS is establishing in our data center through our ecosystem. And as we progress, we expect this to deliver on our goals of increasing SaaS and recurring revenues. Now I'm going to move to our third strategic priority, which is an exciting opportunity to build world-class and leading businesses in digital assets and carbon markets, and I'll lead with digital assets. Our initial product offering will be an advanced custody solution that targets institutions. We're starting with custody as we see it as foundational and key to our product expansion plans. And we're going to take a new and novel approach to solving the key pain points in custody that's been impeding institutional adoption, mainly the trade-off you see today between security and accessibility that lives in today's hot and cold wallet construct. Our digital wallet will offer the security of cold and the accessibility of hot simultaneously. And once we have custody, we'll have a full suite of integrated solution across our franchise, from Verafin's AML and fraud solutions to market surveillance to our trading and marketplace solutions and now custody. Turning to carbon markets. Our investment in Puro.earth has provided us with a front-to-back platform for carbon removal that includes issuance, a marketplace and importantly, registry. And beyond being a first mover, Puro.earth has established best-in-class standards that has attracted quality of supply onto the platform. And near-term opportunities for Puro.earth include an expansion of those methodologies and standards, which can bring more supply onto the platform, which is critical for growth as well as our ability to offer key capabilities such as issuance and registry to our Marketplace Technology clients. And then across both of these opportunities, digital assets and carbon markets, we feel really well positioned to drive institutional adoption and the maturation of these markets because what we can bring to bear is our deep and robust institutional client network, of course, our market structure expertise and our brand. And so with that, let's start to talk about how we're going to measure success for the new division. We're going to continue to provide a line of sight and transparency into the business unit formerly known as Market Infrastructure Technology, now renamed, Marketplace Technology. We're providing an updated outlook for that business of 3% to 5%. And that's in part because now include our trade management services business, which is our colocation and connectivity business. Additionally, we'll shine a spotlight on the growth of SaaS revenues and our progress on key initiatives. So in closing, we've been able to generate strong and consistent results across our foundational businesses, and we've demonstrated the ability to outperform across those businesses. We're encouraged by our adoption of advanced technology because that's going to drive innovation and power sustainable growth. And finally, we're leaning into key new growth pillars that represent exciting and attractive new opportunities in digital assets and carbon markets. And so with that, I'm going to open it up for questions, and I'm going to invite my colleagues, Kevin Kennedy and Roland Chai and Bjorn Sibbern. Kevin runs North American equities, also North American markets; Roland runs Marketplace Technology; and Bjorn Sibbern runs European markets. With that, we'll open it up for questions.

Thank you, Tal. Let's go first to Michael Cyprys from Morgan Stanley.

Great. I was just hoping you could expand a little bit on the digital initiatives and your ambitions there. Maybe you can kind of look out 5, 10 years. What would you say your vision is for Nasdaq in digital assets? You outlined a number of different services, I didn't hear derivatives, spot trading, maybe that's somewhere in there, direct-to-consumer, maybe you can kind of expand on all these different things that we see a number of others going after in the marketplace.

Yes, great question. So let's just take a step back with digital assets. And I purposely called them digital assets and not crypto because the opportunity set that we're pursuing is much broader than that. So we see 5 fundamental issues in the marketplace today. Let's start with that. One is trust. Trust around the conflicts of interest that you see in the marketplace, and they want neutral trusted brands. And so we think we can solve that problem, especially in the institutional space. The second is there's a lack of institutional grade solutions in this space. So you'll hear my colleagues on the panel talk about scalable, resilient, available solutions. There's a lack of that across the ecosystem, and that's prevented institutions for coming in the space. And that's why we're starting with custody. Because if you can't safekeep, nobody is going to let you do anything else with those assets. And then there's collateral management. There's a lot of prefunding that goes on of trades in the marketplace today. We're going to bring to bear on market structure expertise to solve some of these collateral management and capital efficiency issues. And then there's lack of regulatory clarity. So I think if there's constructive regulation, that could be the next unlock for us with digital assets, which will then accelerate institutional adoption. So we see the opportunities that are trying to solve those problems. And if we can solve those problems and we can do it across digital assets where we can power new markets like carbon markets, there's a synergy between what we're doing there in digital assets, we think there's an opportunity to look at non-blockchain assets and native assets, where we talk about tokenization. So those are just opportunities that kind of extend beyond just thinking about crypto assets. And then finally, in our custody solutions, it's important to note this, the kind of velocity that we can welcome in the way that we're designing, it's just going to open up additional use cases for institutions that don't exist today.

Let's take the next question from Owen Lau from Oppenheimer.

Could you please give us an update on your cloud migration? And do you have any updated view on how you can drive SaaS revenue through this migration?

Yes. I can start, and then I'm also going to have Roland talk a little bit about it from his perspective. So just a few things to note. I noted that we've moved our second Options market and our third market onto Fusion, which is a cloud-enabled platform. We have the strategic partnership with AWS. And just a few really important points around the cloud. We're bringing the cloud to our clients, and we're leaning in to our data center in Carteret. That's really important because that allows us to kind of control how we embrace the cloud and how we introduce the cloud. So we're going to look to minimize disruption, offer it as choice and allow our clients to leverage existing infrastructure. And that, I think, is embracing and having our clients embrace what we're doing with the cloud, because we're doing it in stages. And that's why we're starting with AWS Outposts and thinking about how we kind of graduate further into that, where we can offer powerful new cloud services. So what I mentioned also is the private local zone. That is going to be really exciting for us because once we have a private local zone in Carteret, we're going to be able to provide powerful new cloud services. For example, we're thinking about colocation as a service. So how do you think about compute versus actual hardware when you think about colocation and proximity? So those are some of the things that we're doing, and we're kind of committed to this journey. We're excited about where we are, and I think the customer reception has been really, really strong so far.

Absolutely, as Tal said, customer reception has been strong. And when we work with market infrastructure technology clients all around the world, they're looking to replicate the model that Tal talked about in their local data centers, but also on the cloud. And we have a number of SaaS services, such as our risk management product, which when those infrastructures are -- come on to the cloud, we can provide more product to them, we can integrate to them quickly and we can distribute to them much quicker. So that reduces their go-to-market to the client and also generates a number of other opportunities where we can take some of the systems that we have in North America and European markets and show them how to use that on a global basis to our international customers.

And there's one last thing. I mentioned this in my presentation. Trade Management Services is now going to be part of Marketplace Technologies. One of the reasons for that is we think there are synergies between those 2 business units, especially as we have a greater cloud orientation for trade management services. So we think we can unlock greater growth over time. Very early days, but that's why we've done that.

Let's go to Christian Bolu.

Another question on cloud. So on the financial cloud products, I know it's still early days, but can you talk through sort of the customer profile of the early adopters, who are they, what do they look like, why are they early adopting? And in a bigger picture question on the broader market monetization efforts, in 5 years' time, how will we be able to measure if you'll be successful? Is it better volume market share, better client monetization, better margins? Just talk through what the bigger goal of market monetization is.

Sure. I'll take the second half. If you want to...

Okay, sure. So number one, we've got a number of international clients. So we've got Clearing House in North America. We've got Tier 1 national stock exchanges around the world, in Asia Pacific and Middle East and South America. Some of them absolutely want to replicate what we're doing and move to the cloud. And essentially, they're looking at the same growth strategy and also total cost of ownership and efficiencies and also looking at developing their ecosystem and how they can mature it. And the other aspect is they're searching for liquidity. So they're trying to bring liquidity together, bring connectivity together and bring integration together and how to get more international liquidity players to connect to their markets. And using Nasdaq platform and cloud technology, that provides a very strong business proposition for them to do so.

And just a second half of your question, maybe there's 3 ways we can look at as measuring success over the long term. I've provided the outlook that we have for marketplace technology, which speaks for itself. And I also just talked about the synergies that I think can lead to greater growth. But there's 3 things we're doing. One is -- once again, as we adopt cloud and a cloud orientation across our markets, we can offer more cloud native services. We can convert today's on-prem services to cloud services, and that will drive recurring and SaaS revenues. So there's new products that we can bring to market, and we're excited about that. Like I said, we're looking at a number. Two is, in Roland's world, and he mentioned this, there's new market clients that are cloud native, that likely most of those clients are going to start in the cloud. And then third is the ability to have the proof points between our business, the markets we operate and us collaborating with Roland's clients to say, we can help you on your journey, for those traditional larger exchanges where we can share our journey, share our experiences and over time, get them comfortable with the cloud. Now a key unlock there, again, is just the regulatory aspect of it, making sure regulators around the world are comfortable with our strategy.

Let's go to Alex.

I think this is a continuation of Christian's question just now, but you talked about the consolidation of some of the offerings on the marketplace side. It sounds like this is both a cost and a potential revenue acceleration opportunity. So, a, maybe confirm that. But maybe more specifically, how much cost over what time frame do you think you can actually take out of that business by consolidating offerings? And then on the growth side, I mean, do you think there's a couple of points that you can accelerate over time? Any help there would be helpful.

Yes. That's a reflection of the optimization piece...

Yes. I think in terms of the growth synergies, they're definitely there in terms of the -- when we go out to our clients across the world, all they ask is, so how do we get Nasdaq product out there? And I think where this division really works is how we bring that together and bring more product opportunities and create that pipeline to our international clients. In terms of the cost efficiencies on that side, we've got a broader tech organization, and we've definitely, as Tal was talking about, the structural transformation that we're taking through marketplace technologies about rationalizing product, delivering engineering efficiency and also delivery efficiency to our clients, that's already realizing a lot of those benefits already.

Yes. There's maybe 1 thing I'll highlight, and it just underscores why we've created this division. So there's a number of tools, internal tools that we use to operate our markets that we have our market operations team use or that provide clients in terms of how they consume our services, rooted in conversations between Roland and I, about how we can productize those tools, which lowers the total cost of ownership for us, allows us to scale it. And now we're looking at the latent demand that there is for that. And that just ties right back into, what I said in my in my prepared remarks, which is like this full trade life cycle that we want to offer our customers between our 2 businesses. So we've already kind of ignited that effort. We're excited about that effort, and we're putting teams around that.

Maybe just one very quick one. On the cost side of my question, do you actually think you're going to take cost out? Or do you just think it will be reallocated to other areas?

We're definitely looking at -- we're already taking costs out as we speak. So -- but as the divisional opportunities come on, I think there's more opportunities to look at how we create efficiencies in that area.

All right. Great. Next question. Let's go to Rich Repetto.

So mine is an overlap question between your business and Nelson's. So when you look at the index business, your index business looks to be a bit more tied to AUM, which makes it less volatile in most markets. But you've seen a big uptick in the SPX, the index op, retail has been trading index options wildly year-to-date. And with your options complex with your indices, so what's the opportunity for Nasdaq there? Or do you think it's partially because the tech composite is down this year? Or would you be experience -- do you see as an opportunity to trade that product -- those products as well?

Nelson doesn't have to come up on this one. Got it. So I'll just talk about the Nasdaq 100, and I'll have Kevin join me in this one. So there's just a few things to note about the Nasdaq 100 is become the modern day industrial index. So it's become one of the most relevant, popular indexes, and that means it's important in institutions and retail. So there's more portfolios, which incorporate the Nasdaq 100 into their portfolios. They're going to need reasons to manage exposure and risk, and that's where our derivative products come in. So we see kind of a natural flywheel between the Nasdaq 100 and its popularity and the inflows that we've seen this year and the strength of our derivatives business. That's first. Second is, and you mentioned this, and you're right, we have this young complex and ecosystem that we're building, and it takes time. So there's a lot of education, marketing and awareness that we need to put into it. But we've developed this really unique complex between us and CME with all the products that we have now from the volatility product to the retail product to NDX, then now we can start to attract interest and liquidity in a different way than we could 2 years ago. So we're seeing real growth there. And then the third is we're starting to see ETF providers design more products around the Nasdaq 100, like Invesco. So Invesco with their new generation product, that is just driving assets, inflows and once again, another reason to use derivative products to figure that out. And then the last tailwind that we've noticed more recently has been the shift from single stock back to index. I'm sure you've seen it as well. So in 2021, that story was all single stocks. Now we're seeing a shift back into the index side of the house, and that's been great for our business. So a combination of all that should expand the TAM for us.

Yes, there's not much more to add, Tal. But except that -- this happens often with me. It is a tremendous opportunity. We are excited -- what I can tell you is we're doing it the right way. And we're seeing institutional growth year-over-year of over 25% to 30% in the institutional side. We still see retail trading to get beat up a little bit earlier this year with the corrections, but retail is still trading and a lot of upside there. We're really excited about it.

Just one quick follow-up. On the digital asset space. You talked about custody. Can you just lay out just a brief quick time line when you actually launch these different services and products so we can get a sort of vision of when we expect to see traction, I guess?

Sure. And I'll try not to take and steal the thunder from the panel, you're going to hear from shortly. But we announced just about a month ago that we're launching custody, but custody with execution services, and fraud capabilities wrapped around it. So like an integrated custody solution. We're working with New York DFS right now to obtain our trust license. I don't want to get ahead of that. We've had great conversations with DFS so far, it's been great engagement there. So that's one thing that we need to make sure that we have before we launch. The second is just in terms of customer adoption is we've seen off the back of our announcement, incredible reaction to what we're building here. So we think the pipeline is strong. We think it's the first half of next year that we'll be able to launch, albeit we need to get our license. And then the second part, and you'll hear this from others that are on the panel we are at a point where we actually have like a beta version of our clients that we can showcase to them for custody. So we're now actually going out on the road in the next couple of weeks, and we're going to start to do demos of our custody solution. And as you know, which, there's a big UI component to it, there's an execution component to it, and there's a fraud ML component to it. And so all of that will be part of our day 1 solution. And then as we see regulatory clarity, whether it's best execution or CBOE that's developed, then we'll start to consider additional opportunities.

All right. Thank you. First of all, we have a few more questions in the audience. I'm going to ask them to please hold them for the longer Q&A session at the end, so we can try to keep things on track. Tal, and your team, thank you very much. And next, we're going to have a panel discussion on the topic of leveraging important technologies to elevate growth. And so we'll take just a moment here to set up some chairs. We're going to have Brad Peterson, Nasdaq's Chief Information and Chief Technology Officer, moderate the panel. Brad has led Nasdaq's technology organization for 5 years. And before that, I worked at eBay, PayPal and Schwab. Brad, I'll turn it over to you to introduce your panelists.

Thanks, Ed. And I'm joined by 4 colleagues. You've heard about our strategic initiatives. These are the folks that are leading and building a lot of those. So we have some exciting things to talk to you about. I'm going to introduce my panel here very quickly. Brenda Hoffman, right next to me, came to us 7 years ago, where she was prior to this, up at the TMX as CIO. And she is the new divisional CTO for Market Platforms, which is the group you just heard from. So we've combined together marketplace technology so that we can really take advantage of what we do for ourselves. And then there were some questions during -- after Tal's discussion about how do we actually see cloud adoption. So we're going to be happy to talk about that throughout the panel as well as take a couple of questions at the end. Prior to TMX, Brenda spent time with IBM, actually delivering solutions into the capital markets. So very great background, relevant for what we're doing here. We have Rob Norris, who joined us 1.5 years ago through the Verafin acquisition, but Rob is not a newcomer to Verafin. He was one of the early members of the technology team. And some of the secret sauce there was really doing the hard work of integrating the transaction, the many transaction systems that populate the Verafin platform as well as working on all aspects of the Verafin product. So throughout -- after his strong tenure in technology, he moved into product management and now he's running the new market that is behind the opportunity for Verafin's entry into the cryptocurrency and digital asset space. So really excited to have you part of it coming down from New Finland. And then Nick Ciubotariu, he joined us a year ago from PayPal, Venmo and at PayPal, Venmo, he was instrumental in building and introducing cryptocurrencies into PayPal as well as so very relevant. You can understand why he's up here as well as a huge win for Venmo getting them accepted on the Amazon platform as a payment mark. So a big contribution. Nick runs our -- he runs our enterprise architecture group, and that's where he's responsible for a lot of the core engineering performance, engineering cloud, engineering our emerging technology that includes AI, ML and quantum. And not surprising, he is building -- he's doing product engineering for the new digital assets and cryptocurrency initiative that we have. And finally, our newest member of the Nasdaq team, and it's somewhere between 3 and 4 months, but it feels like you've been here for years. So Ira Auerbach. He joined us from Gemini. So he spent time at Gemini. He was running their prime broker offering. And prior to that, he was also at Palantir Technologies. So he has a great technology background and an incredible business sense, very relevant with the last retail phase of the cryptocurrency trend. But what he's coming to Nasdaq to do is really build out that custody and an execution platform. So we're going to hear some of Ira's thoughts on what attracted him to the Nasdaq opportunity. But we've heard a lot. Let's start with -- we heard a lot from Adena and Tal about modernizing markets. And 2 years ago, we were together. And I will say that during COVID, we did not like some of the customers who postponed things, we put our foot on the gas. And during COVID, we accomplished quite a bit. So Brenda, maybe, since last Investor Day, what's been going on?

Yes. So thanks, Brad. Yes, we've been super busy. We took the opportunity during COVID to actually, as Brad said, put our foot on the gas. And a lot of things have happened. So first of all, speaking about the cloud, we have been working with cloud technology since 2008. So while we're elevating it in the organization for our products and services, the technology teams and some of our products and services that run our 25 markets that we own and operate, those systems, whether they're data or systems that support the core trading, we've been putting those in the cloud over the last year. So lots has been happening there. And then during COVID, specifically, we built our new platform for options, which is called Fusion. Tal mentioned it. And that Fusion platform is a global platform. It's designed to be able to run all of our 7 options exchanges that we own and operate. And during COVID, we put it in 2 times, twice. We put it in September 2020, we put it into one of our U.S. markets. And then this past year, in March, we put it into the Nordics and [indiscernible] market. So lots has happened there. And then maybe more importantly, 11 months ago, almost to the day, we announced our partnership with AWS. And what we've been doing since then is we've been full time, have not looked back and we have been working with AWS. And we put our first market in the cloud, yesterday was its first day. So took us 11 months. Everybody worked full time on that, of course, 7 days a week.

How's the performance because people say the cloud can't perform.

Yes. Okay. So how does it perform? It's actually excellent. So in our first day, which was yesterday, we had about a 10% improvement on our metrics where we measure. So yes, there's lots of anecdotal speak about the clouds. It can't be performant. Well, we've spent the last 11 months, taking our platform, working with AWS, and we've ensured that, that platform is actually performing better than the one that we had on-prem. So it's pretty cool. So a lot has been happening.

Excellent. Well, let's transition to Rob and AI and machine learning. So that is foundational to I think the efficacy of the platform. And so talk to us a little bit and your other solutions, so talk to us about that and why it's so important to Verafin and distinguishing ourselves from others?

Sure. So Brad, I'll start with saying in the AFC space, when organizations are evaluating solutions for anti-financial crime, so detecting fraud and money laundering and such, really one of the -- if not the most important factor is your quality of your detection protection capabilities. So -- and what we mean by that is you have your true cases of fraud and money laundering, your true positives detect as much of that as possible, ideally all of it, but also the other side of the coin is you want to not generate out of false positives. So as positives are the non-consequential alerts sort of the dots. And that's really important, especially for larger organizations because if you have too many false positives, you need enormous teams and staff to kind of walk through those alerts. So there's a lot of focus on maximizing your true positives and not having many false positives. So jumping into artificial intelligence, that really becomes kind of the key tools you can use to drive that detection capability. So at Verafin, all of our models, use one technique or another of artificial intelligence, things like Bayesian Networks, Fuzzy Logic, machine learning are all embedded in a lot of our analytics. I will say the one thing that I think is quite different or a differentiator for Verafin's approach, is over the last nearly 2 decades, we've grown to have over 2,200 financial institutions that leverage our product. So this actually provides the availability of an enormous data feed. All of the financial transactions that are occurring through these institutions and what's particularly interesting is within that data are what we call -- is what called label data, if you ever heard of that terminology for machine learning. And label data really are the true -- the label frauds or interesting activity that financial institutions want to see. So we have in front of us this enormous capability of doing machine learning on real fraud trends that are occurring day by day. It's a very powerful capability. This data organically happens, everything from payments like Wire and ACH type transactions, check fraud or deposit fraud, as we call it. As banks settle, the participants settled between those transactions, any frauds are typically labeled by the financial institutions in that data. So we witness and can see and have availability to all of that data. And that really has produced some really fantastic model. So I think, Jamie, one of the later keynotes, will actually give you an example of how that performs at a very large financial institution. The one thing I will say is that some parties in the world will kind of say that we're doing machine learning. But really, it's important to know that machine learning is only really as good as the data that you have available to train your models. So even a single large financial institution won't really have enough data to really create a fully optimized model.

So I think the term MOAT has been used by some famous investors. And if you think about it, it's -- Verafin did a lot of the hard work to really be able to understand the transaction format of all the banking systems that serve in North America. That work has been done. So onboarding customers is accelerated because you've gone through that phase of hard work. The second thing is really having the data, like you said, seeing that broad view so that a lot of the folks that are potentially going to be causing this trouble in financial system are going to show up in this network. And then the third thing is cloud. You built it. You were an early -- you guys were an early adopter. And so talk about how that -- you're up there in Canada, you're serving the Canadian market, which is much smaller than the U.S. Talk about the importance of how you were able to expand them into the U.S.?

Yes. So Verafin was originally created in 2003. We've been cloud-based from the start. So we've been -- and I don't think we would have been able to scale across hundreds of financial institutions now over 2,200 financial institutions banks, up from large banks down to community banks, credit unions, all sorts of depository institutions are comprised in that data set. And we wouldn't have been able to do that without having a cloud approach just to reach that scale. So yes, we've been cloud-based originally at the beginning sort of our own cloud environment. And about a decade ago, we moved to AWS. So that's been actually tremendous and us being able to not just add customers, but also scale to new regions. We've moved from Canada to the United States, the United States where the majority of our -- the Verafin customer base currently resides and even more recently created a new region in Europe. So it allows us to scale geographies across the world as well.

And that was a question I heard from the group, what is some of the benefits you see? It's speed. It's the ability to really normalize or neutralize geography. So let's transition to Nick. So you have a history at Amazon and at some of your prior employers applying broadly AI and machine learning. Maybe talk about how you see this as beneficial to scaling our products at Nasdaq?

Certainly. Thanks, Brad. I do want to take just one moment to congratulate Brenda on moving our options change to the cloud. In 11 months, it's an incredible feat. And I think it just demonstrates the strength of -- our range in your team.

Your team was part of that as well. The performance -- you heard the performance, he has performance engineering. And so together with Don, Berry and many others.

Getting back to AI and ML, I've been in this space for a long time, and I believe that truly the intersection of software and science is a superpower. And as Nasdaq is a software-based capital markets platform, this is the perfect place to apply that. We use it in a variety of spaces. So I'll just give a few examples to keep the panel going. Let's say ESG, for instance. This is obviously a growing opportunity for us, something that's super important. We use AI and ML to attain ESG data superiority. And how do we do that? We use natural language processing, algorithms to go through millions of documents, collate them, catalog them, analyze the data. And therefore, provide ratings for thousands of companies. And we also update that anytime that update needs to be made. This would be virtually impossible to do manually. And by using natural language processing algorithms, we do this seamlessly, which is a great thing for us. From a capital market standpoint, obviously, we want to make our electronics -- electronic trading engines smarter. So we use reinforcement learning to dynamically change orders, improve order execution, provide tighter spreads, reduced messages. And this is important because there's a lot of load on our platforms. So this enables our market platforms to be more performance, to have less load, and this ultimately provides better execution and a better trading experience for our customers. And speaking of performance, when you're running capital markets at this scale, you want to be proactive, not reactive. And we use a variety of AI and ML technologies to look at how our technology is performing, are we anticipating high amounts of load? Do we see or foresee errors? Do we need to scale up or down either now or immediately or in the future? So this enables us to not just react to events and high volatility and high liquidity events and noise, but to be able to anticipate it and prevent it. So these are just a few ways that we use AI and ML at Nasdaq. It's truly a differentiator for us and something that we're going to continue to bet big and double down on.

Yes. Exactly. Thanks, Nick. And Ira, so you are leading our digital asset and cryptocurrency business. So maybe talk about the top priorities that you see for that? And I have a second question for you after that.

Yes. Sure. Thank you, Brad. And I have joined approximately 3 months ago to lead our assets initiatives here. But I think it's important to note before we went to our platform discussion that Nasdaq has been involved in the digital asset space as far back as 2015 in providing technology to the market. And since then, we've engaged with the ecosystem across 3 main areas: First, in anti-financial crime technology with the Nasdaq trade surveillance system and now, more recently, with the Verafin product and all the great blockchain native analytics we're building there. On the Investor Intelligence and data analytics front, where we have built the Nasdaq Crypto Index, which is a tool used that several exchange-traded products globally have built on top of. And then, of course, our market platforms technology, which is used as a matching engine globally at several exchanges. And we've taken those learnings, that institutional listening and working with our clients to determine that there was an absolute need for a resilient performance, scalable institutional focused platform. If you're a retail trader and you go to buy Bitcoin and something wrong happens on your web app, you could click the refresh button and try again. It's not the best experience in the world, but it will get you to where you're going. On the institutional front, that's absolutely not possible for that to happen. You need a partner that can grow with you and knows your workflows and can be scalable and available to that point. And when we look at building our platform, we notice first and foremost, something like Adena and Tal have mentioned earlier, that custody is absolutely foundational to that platform. Simply put, if you cannot hold on to this in a safe and secure manner, your customers won't trust you to do anything else with them. So to build out our custody platform, we really look to solve that trade-off between the security of cold wallet systems and the availability of hot wallet architecture to put those 2 together and build a platform that leverages the best components of both of those. And to do that, we have leverage the latest cryptographic tooling to protect private keys. We have built an entirely cloud-native platform for scalability and availability, and we've housed it all behind the Nasdaq and private network for added security.

Excellent. So the institutional opportunities, so maybe just summarize the key 2 pain points. And then since we just finished the World Series, let's use the baseball analogy, what inning are we in terms of adoption in the institutional investor space?

Great. If you don't mind, maybe I'll switch those around. Keep the baseball analogy all to back.

Absolutely. You can do what you want.

I think we're starting in the second inning of the digital asset revolution. I think the first inning can be classified by an almost awareness campaign. What is Bitcoin? What do you see in there? What does blockchain technology? What can it do for my company? What can it do for me? How can it affect the world? And I think the second inning we're moving into is where we build that scalable infrastructure that companies can build on top of and can really permeate society. And in terms of the institutional pain points we're seeing, I won't repeat all of the things we've said on custody. But on the trade and execution front, the ecosystem right now is, for the most part, prefunded and fragmented, which are 2 terrible words to put together when you're talking about trading. And we look to solve that pain point by leveraging our market structure expertise and internal risk management systems.

Excellent. Well, Nick, I'm going to ask you since you're building the custody solution. Maybe a couple of, you can do the speeds and feeds, but we won't go real deep into that one.

Ira covered a lot of what's important. I mean I think everyone is aware of the pain points that exist now in decentralized finance. Platforms go down all the time during high liquidity events. You hear of cross chain hacks, private key theft, wallet attacks, phishing attacks, et cetera, and these are almost like joking matters. You'll hear companies tweet about them or just another day in crypto. You simply cannot have that. This is real money that's lost by people. And this is why the majority of institutions have been under the space. So this is exactly what we're solving. And we started this approach by looking at the 3 foundational pillars on which any software is built, and they're in order, it's availability, security and performance. So I'll start with availability first. If you're not available and you're not online, nothing else matters because you're just invisible to the world. So we built the most available platform in digital assets that we possibly could. And we started not just with an active, active approach or hot failover, but we employ technologies like global table commits, multi-region aware redundancy, true instant failover in case of any liquidity event that would take down our platform, being able to flex up and down automatically using artificial intelligence, as we said before. So in case of any high liquidity event, we would always be up and always be available just like our market platforms are. In terms of security, we started with a zero trust model all the way to putting our technology behind a highly secure private network that takes multiple factors of authentication to get in and using multiparty computation, encryption from -- multiple methods of encryption from coated data, including NPC, and other things that I won't get into here, to make our solution truly as secure as possible. And from a performance standpoint, we can flex up and down to multiple factors. So anytime that we have load, we have -- we see performance needs, we're able to instantly scale. It's not even a human process, it's an automated process. All of this is built not only on a cloud native platform, but actually working with our cloud partners to build cloud-native watching permits, which is super, super important. And this is what the institutions have been asking for. And we're also partnering with Verafin that's been a leader in the AML and AFC space for 20 years. And I think the unique value proposition here is we're able to take their expertise and leadership at 20 years and the Tradify or SeFi space and complete the flywheel with their offering in the DeFi space. And I think that's a very novel and unique proposition to us.

Yes, that's a good transition to Rob. So running the new business. So what do you see as our unique approach and opportunity there?

Yes. So it's a very exciting time, I think, in AFC, just about a month or 2 ago in tandem with the custody announcement, Nasdaq AFC also launched AFC Solutions for the digital assets or crypto space. And this includes both from our surveillance product, the ability to monitor for marketing mitigation with digital assets, in combination with the traditional assets that are already covered. And from the Verafin space, it's now looking at blockchain analytics and blockchain forensics in concert with the analysis of fiat currencies that we already have been providing expertise in. So it really is a holistic coverage of both digital assets, traditional assets, fiat and crypto all in one platform. This is something that is unique. There's a lot of point solutions out in the market that an organization we have to cobble together a compliance program from very distinct solutions, and this really is a holistic approach. I will just touch on one of the technological advancements that was needed to kind of breathe life into this was the development of the blockchain analytics, which means that we need to integrate not just only with the feeds that are coming from a customer of ours, whether it's usually the offchain feeds, fiat and those sorts of things, but also with the public ledger blockchain themselves. So we are monitoring block by block live, your blockchains, pulling that data in and really giving the customer a holistic view about the fiat activity and the on-chain activity and looking for things like Nick mentioned a bit earlier, there's a lot of criminal activity that happens on chain, right, funds that are stolen, funds that have resulted from scams, ransomware, you name it. So being able to detect exposure to those sorts of things on the blockchain is what we're bringing into the solution.

Excellent. Well, you heard about -- and you heard about the priorities that Ira has custody, then execution services. You can see that we're building our custody with the Verafin assets and our trade surveillance has already been in market in this area. The last piece is, so Brenda, how do we bring all this together for execution services? How are you going to work with Nick and Tal -- excuse me, Nick and Ira, you'll work with Tal, too, of course. Everyone works with Tal -- but let's -- our final question is just how does this all come together for Nasdaq?

Well, I mean, I think it's probably clear, but I'll just say it is working together with all of my colleagues here, all of the technologies at Nasdaq. So bringing us all together, so the deep knowledge that we have across not only tech but how to use that tech in the industry. So I'm very excited about building an execution platform with Ira and Nick, leveraging everything that we've been doing over the years. So to me, I think that's going to be really cool, and we're looking forward to...

At the institutional scale?

Yes, at institutional scale and all of the things that Ira talked about, like we need the resiliency. We understand that. That's in our DNA, of course, for our markets that we run here. So there's lots to do, and the engineers are pretty excited about the work that's to come.

Excellent. Well, thank you, everyone, for your time up here. And Ed, I don't know if we have any time for a question or not?

I think we're going to have to probably save questions for the end. And also, we're going to have our technologists also at the lunch and so you'll have a chance to talk to them then. I wanted to thank you, Brad, Brenda, Rob, Chris and Ira. Thank you so much for being with us today. We're going to take a break now, and we're going to resume the program at 10:15 sharp. Thank you. [Break]

All right, everyone. We're going to resume in just 10 seconds. All right. Thank you, everyone. I'm very excited to resume the program after that quick break. I'll be turning it over now to Jamie King, who leads our anti-financial crime business.

Thank you, Ed. So I've spent the entirety of my career as CEO of Verafin up onto the Nasdaq acquisition a few years ago. This is my first Investor Day. So I'll ask you to go easy on me. So then we talk about the AFC business, the expanding and growing market opportunity and how we plan to win in this industry. So as you heard earlier, Adena talked about the core purpose of Nasdaq in the context of a strategic framework to advance economic progress for all. And this is a strategic framework that we've used for quite some time at Verafin, and we put a lot of energy into thinking through this. Not only does our purpose of protecting the world from financial crime support the Nasdaq purpose, what we also think about this as creating discipline in terms of the business that we're in. As we look for new opportunities, we always ensure that these new opportunities fit in the guide rails of fighting financial crime. And this creates a lot of discipline and focus within the business. Our long-term vision of protecting the world's financial interactions creates alignment in the business, and everything we do is designed to take us closer to that long-term vision. And of course, we put a lot of energy to understand our value proposition and how this differentiates us from our competitors. And at a very high level, we provide SaaS solutions for anti-money laundering, fraud detection and trade surveillance. And of course, there's so much more to our value proposition, which I'll talk about later. So the AFC division was formed by bringing together Nasdaq's leading surveillance solution with the Verafin fraud and AML solutions. Now as Verafin fraud and AML solutions is generally targeted smaller institutions, and we've grown to over 2,000 financial institutions. And we've built a massive cloud infrastructure scale. And this is very complementary to the surveillance business, and they have an impressive sales organization, which have sold to some of the largest organizations in the world. And they've also built a solution that analyzes data at an immense scale. So these are very complementary businesses, which have been brought together to create a global leader in AFC with a unique value proposition, and we are well positioned to continue to grow this business. So in addition, this new AFC division has the most comprehensive suite of products in the industry, consists of a suite of fraud detection products, anti-money laundering and surveillance. And even within these suites of products, there's a whole series of products that can exist as point solutions. For example, within our fraud detection suite of products, we have payments fraud, deposit fraud, online account takeover as well as many other types of fraud detection capabilities. And all of this sits on a very advanced user interface platform, including learning case management, with intelligent investigations, enterprise reporting. In addition, we've developed a novel approach to collaboration, which is built on the 314b framework and the PATRIOT Act, which no other competitor actually provides. So what does this mean in terms of financial snapshot? We had $292 million in revenue. We may be the smallest division of Nasdaq, but we'd like to think that we're small and mighty. I want to draw your attention to the rule of 40. This is -- we've been running the different side of the business using SaaS metrics for quite some time. For those that are familiar with the rule of 40, and there was [ black ] publish by a group of BCs, I think in 2015, that showed that the most valuable SaaS companies in the world had EBITDA margins when added to annual revenue growth that exceeded 40. And so this is something that we started using to manage the business for quite some time, and we've adopted a bunch of other SaaS metrics, such as looking at our customer acquisition costs, our gross margins, our churn, all those various metrics. And so we've decided to focus on the Rule of 40 as we've grown this business. And as you can see with 46, in terms of the rule of 40, this is essentially a world-class SaaS business. Now when you think about the rule of 40, there's a lot of decisions involved in terms of how much growth do you want to pursue and how much profitability do you want to maintain. And we've decided that in terms of a responsible growth with healthy profitability, we would continue to try to sit somewhere right in the middle of that with equal profitability and EBITDA margins. We think that's a responsible way to grow business as we continue to move forward. So this is supported by strong customer growth and revenue growth over the last few years. And as you can see, we've maintained a 6% customer growth, each on top of 2,000 customers that's a healthy customer growth. What's more exciting about this slide is the revenue growth, which far exceeds our customer growth, and this is driven by a couple of things. As we move up market, we continue to see larger contract sizes. In addition to that, with an extremely low churn and a continuous upsell of new functionality to existing customers, we're seeing a very healthy revenue growth that exceeds customer growth. So next, I'm going to talk about the market, how it's expanding. How this is a big opportunity. So financial crime is a large and difficult problem. Estimates suggest that over $200 billion is spent by financial institutions annually trying to fight financial crime. And this consists of spend for technology and people with the vast majority still being spent on people costs. And if you look at the large Tier 1 bank, you'll see that they still consist of thousands of investigators that work multitude of alerts on both the fraud and AML side. It wouldn't be unusual to see 4,000 to 5,000 investigators in a large international bank, simply work in the massive amount of alerts that are generated by some of the first-generation systems out there. In addition to this, estimates suggest that about $4 trillion are laundered annually, with less than 1% of funds recovered. So the result is, there is a large and growing opportunity, which is further driven by 2 forces. First of all, financial crime is growing rapidly. An important example of this is with wire fraud, which has doubled over the past few years and has now become one of the biggest concerns for large banks out there. In addition, we see fraudsters targeting elders as an example, at an increasing rate. And this is important to large banks because many of the states have specific elders people laws, which requires the banks to do more to try to solve this problem. The second driver is regulations are continuing to get tougher. And every year, we see new regulations being introduced in the field of fraud and anti-money laundering, but a particular interest here is this potential liability shift in consumer frauds' game. So today, for certain types of fraud scams, such as business email compromise, the bank is generally not on the hook for those losses. They push those losses to the customer. What this potential liability shift will cause is for the banks in the future will be required to pay back the customer on those losses, right? This is a significant change in regulations when this comes about because it's going to require these banks to implement new and innovative solutions to ensure that they don't -- so that they ensure that those losses don't become excessive over time. So now I'd like to play a testimonial from First Bank of Omaha, who switched to Verafin from one of our competitors. They're a great customer, and they continue to push us to be the best in the industry. [Presentation]

So just I'd like to spend some time summarizing the opportunity, talk a little bit about our strategy in the past, how we've grown to a leader, and how we're confident that, that strategy will take us forward and continue to be a leader as we move upmarket. So I mentioned focus and discipline. And as we've grown Verafin, we've continued to focus on key segments and industry. We've always said that we don't have to have the best product in the world, but we have to have the best product for a specific group of customers that we are targeting. So we started, as Rob said earlier, with Canadian credit unions, and our philosophy was we had to have the best solution for Canadian credit unions. Then we move to U.S.-based credit unions. From there, we move to community banks. And from there, we move to midsized and national banks. In each step of the way we invested incrementally into adding functionality that will be applicable to that new segment at the market. And every time we did that, we established a leading position in each segment. And so now we are well positioned to move into the large bank market, and we feel that we will accomplish the same thing with the same strategy. And so with that said, even though we've achieved this leading market position in each of these segments, that still only amounts to 3% of total SAM available, and the same can be said for the surveillance products. Even though the surveillance team has established a leading position globally with their trade surveillance and market surveillance products, there's still a tremendous amount of opportunity left. So with that, let me transition to our strategy as we go forward that we think is going to continue to help us grow into this massive opportunity. So I want to spend a little bit of time on this slide, and Rob talked about this earlier. When we first built Verafin 20 years ago, we architected it as a hosted solution. And we moved to AWS more than a dozen years ago. So we've -- and we've grown the business to over 2,000 customers. We've developed a massive cloud network. And we have always thought about this network, not as 2,000 individual customers, but as a network that looks like a single customer. And so we've thought about how can we use this data to build innovative solutions not by looking at each individual institution separately by looking at this cloud network as a whole. And what we've done to make that a possible and there was a very good decision we made a very long time ago, it was each time we integrate with the new bank, we made the data looked the same, right? And there are hundreds of banking systems out there and hundreds of transaction systems we normalize that data so that in the network, this looks like a single institution. So I'm going to give you 3 examples of how we've used this network to create a compelling differentiator from our competitors. So as Rob mentioned, machine learning is only as good as the data. And this is the biggest problem for banks and credit unions, both large and small, is having enough label data to train the machine learning algorithms to be able to detect this type of activity. In our cloud network, we can create anonymized label data on a massive scale, which has allowed us to deploy machine learning in a way that most other entities cannot do. So that's one example of the benefit of the cloud. Second example is because of this network, and the distribution of institutions all over North America, we can see trends as they are happening in real time. And what this means is we can adapt our algorithms. We do weekly releases of our software. We can adapt our algorithms and, in some cases, even before a bank experiences a scam. And this was evident during COVID, when we very quickly saw a whole bunch of scams. And one of the most interesting ones was companies that were setting up fake websites for personal protective equipment. We all remember how difficult it was to source this type of equipment. And some of our customers actually fell for these scams. What we were able to do is develop algorithms that look at wires to unusual entities that did not exist in the cloud before and alert our customers that this might not be a real business, which leads to the third example I want to use, which is the ability to authenticate counterparties in the network because we have such a massive scale of data. Not only do we look at our customers' customers, but we look at the counterparties of transactions. And that allows us to efficiently determine whether that counterparty is a legitimate entity on the network, which has a massive impact on reducing false positives for things like wire fraud. So this is a particular importance as we move upmarket and target large banks for a number of reasons. Large banks are slow to adopt the cloud. And because of that, they've implemented first-generation on-premise solutions. This is supported by a lot of inefficient manual processes. As I mentioned earlier, many of these banks have thousands of investigators that are working the multitude of alerts. And ultimately, there's ineffective detection approaches, which result in high operational costs. So our cloud network, our advanced analytics are well positioned as we move upmarket. So we've established 4 clear priorities to advance our position in this large growing market. We're going to continue to grow in smaller bank market with our FRAML, or Fraud & AML, product. We're going to unlock the large bank opportunity for fraud detection and AML. We're going to continue to invest and grow in key surveillance segments. And the fourth opportunity, which is expand our solutions with joint digital asset offering. So let me talk a little bit about the small bank opportunity. If we did nothing but continue to focus on small and medium institutions, we would still grow at a healthy rate. We have over 2,000 bank and credit union customers, but this is in a market of over 10,000 institutions. Between acquiring new logos and increasing our share of wallet with new functionality, there's still plenty of opportunity with smaller institutions. And our leadership position has made acquiring new customers much more efficient. As I said earlier, we apply SaaS metrics to various parts of the business. And I can tell you that the customer acquisition costs with smaller institutions has gotten very efficient. And the other nice thing about smaller institutions is they tend to want to move together. So whenever there's -- you establish a leadership position and the regulators are familiar with those products, other institutions tend to want to buy those products as well. But what we're most excited about is moving up market where we see massive opportunity with the large bank market. And what we've done is we've developed a strategy of leading with some of our most innovative fraud products or point solutions in the areas where banks are experiencing the most pain. And an example of that, as I talked about, is wire fraud. This is an area that's been a growing concern for large banks. And the other thing that we -- the other part of our strategy, which has proven to be quite effective is offering proof of concepts to these large banks. And proof of concepts in the fraud world has become common because what we can do is we can run our fraud algorithms on historical data, and we can compare it to the status quo and the solutions they're currently using. And with our wire fraud solution, our ability to authenticate the receivers of wires in the network, we've been able to show a compelling value proposition, in some cases, with a 50% reduction in wire fraud and up to a 2.5x improvement in detection. And when you can show this type of improvement in fraud detection, the business case becomes very compelling for these large banks. And there's still plenty of opportunity with our surveillance product, where we have also adopted a more disciplined strategy to focus on key segments. We're scaling up sales and marketing to grow the sales funnel and invest in improving detection algorithms to keep up with the changing criminal activity in trading. The final initiative which we're very excited about, and Rob talked a lot of detail, is our digital asset strategy. By combining our capabilities in the traditional finance world with our new blockchain analytics, we were able to track the flow of funds from traditional banks into the world of the blockchain and back again. And this is a key differentiator. There's players out there that are blockchain analytics and there's players that are traditional finance analytics. Verafin is bringing these together to create a compelling offering. In addition, by combining fraud-AML surveillance solutions, we're able to offer the most complete AFC solution to digital asset exchanges around the world. So what does this mean for AFC? We are confident in our 3- to 5-year outlook that we can continue to grow this combined business at 18% to 23% annually. In summary, AFC is a global leader in anti-financial crime. We continue to pursue a large massive opportunity in a fast-growing market, and we believe we have a clear strategy to continue to build this business. At this point, I'd like to bring up Brendan Brothers, Valerie Bannert. Brendan is our Chief Strategy Officer, and Valerie runs the surveillance business, and we'll take some questions from the audience.

Thank you, Jamie. Let's start at the front with Gautam Sawant.

Given the strong performance that you've seen with the original proof of concepts at large banks, can you talk about where you are in the sales cycle with these large banks and when you expect to see some monetization or adoption of your platform?

That sounds like a great question for Brendan.

Yes. So early results, as we've shown in the slides, we're expecting those to turn into opportunities in 2023.

Jamie, if you had -- I think it was 18% to 23% growth rate. If you had to break it up into same-store sales versus new customers -- versus from new customers, just a quick break out there. And then when you talk about this digital fraud detection, it seems -- I mean that's the main problem, I think, across the digital asset trading space. So like your audience there is all exchanges, all -- is it the crypto universe in general? Like how big is the TAM or the tight customer TAM in that digital asset space?

Let me tackle the first question first. So as far back as I can remember, we've always been focused on new logos, right, and growth of new logos because the ability to upsell can come later, right, as we acquire more market share. But that said, with 2,000 customers, the upsell potential or the value of upsell to our existing customers is eventually starting to catch up to our new logo sales. And at some point, we think that just because of the sheer number of customers we have, that the upsell potential will exceed our new logo revenues. And one thing I'll say that -- about moving upmarket, which I would much rather do than move downmarket, as we move upmarket, our larger customers constantly request new functionality. And what happens, because we have a single tenant or multitenant cloud solution, other functionalities available to our small customers and just inherently provides upsell capability at no extra R&D costs because this functionality has been requested by our bigger banks, right? So we get that doubling effect there. The second question, which is related to digital assets, I will pass on to...

On the crypto market sizing. So when you look at the market sizing that we have shown today, the crypto opportunity is actually embedded in that. So -- and the reason is, on the one hand, we have physically launched a new crypto-native funds, which currently is smaller market size, but growing at a very high rate. But at the same time, we see increasing adoption of the traditional acquirers that's actually adopting crypto capabilities, offering them to their customers. And so they are becoming equally a growing customer base for us as well. And we're really kind of looking for the upend from the regulatory pushes around the world for them to really drive adoption, which will also accelerate that part of the market opportunity. But at the moment, we've embedded this into the market sizing.

Great. I think I had a question over here from Dick Manuel, Columbia Threadneedle.

Just forgive my ignorance on this, can you apply your approach to the transactions on the Zelle Network?

Absolutely. And we do. We do. We do apply to the Zelle Network. Zelle is relatively new, and there are some competing technologies to real-time payments. One of the things that we've done with our payments fraud, and I'll try to just simplify this, we've -- I mean all payments require a party and a counterparty, right? And then our network, what we've done is we've tried to obstruct away from the channel, whether it's Zelle or wire fraud through the Fed and look at features above that. And what that results in is a set of functionality that really can be designed independent of the payment channel, right? So for example, if we're authenticating a receiver of a wire transfer. And a lot of these -- and the reason we authenticate receivers is because most fraud scams will be sent to new accounts, right? It's very simple. And if we can authenticate that this receiver has been around for a long time, conducting legitimate business, we can tell the bank that this is a good receiver. And that's true whether it's Zelle, real-time payments, wire fraud, ACH or any other payment channel.

I think we have a question from Craig Siegenthaler at Bank of America.

I wanted to better understand the sales pitch or the value proposition for a Tier 1 financial institution versus a community bank. Like how is it different? Is the network effect maybe less important for that pitch? Like what are the important elements of that?

I'll start, and I'll let Brendan add to this. And you're right, it is different. Traditionally, with a smaller institution, our sales pitch is all about, like we cover all your fraud and AML needs because we've got a very comprehensive solution, right? And that's very meaningful to a small institution because they don't want to integrate 6 or 7 different products, right? Obviously, not a big concern for a big bank. A big bank is more concerned about the efficiency or effectiveness of the solution. So the sales pitch, and I'm going to oversimplify and Brendan can tell me it's a lot more complex. But essentially, we're going to big banks and we're very confident about this. We're going to say we can reduce your wire fraud by x, your false positives, and we can improve your detection by this amount. And we'd love to show you through a proof of concept. And wire fraud is particularly easy because it's the single channel wires which are readily available. We can do the implementation of proof of concept very quickly. And in every case we've done that, we've been able to show the effectiveness of our solution.

Yes. I mean the only thing that I would add to that is any banker that you speak to, their #1 concern is the things they don't know about. And the power of the cloud and network approach is that we can help bring things to light for them that they don't know about using their own data. And that makes it really compelling there.

And just to add one more thing about -- we have a suite of fraud products. And the idea of going with a point solution is a great strategy because the way we deploy our solution, we could turn on and off fraud modules, right? So wire fraud is compelling. The results are very compelling. The business case is very easy. As soon as they implement it, we follow up with, hey, why don't you try our ACH file? We'll just add another feed, you can try that as well. And so all of a sudden, expansion becomes very easy as we get one of our fraud products into these banks.

Let's go next to Michael Cyprys from Morgan Stanley.

Great. Just curious if you could elaborate a little bit on the conversations you guys are having with the large banks just around how do you think about outsourcing this? Do they view this as a key capability that they feel like they need to in-source? Maybe you can kind of give us a sense of what portion in-sourced versus outsourced today as well as talk a little bit about the competitive landscape in the big bank space.

Maybe, again, I'll start let Brendan finish, so. You're right. As we move upmarket, the key competitor is generally their own model builders, right? And some of these folks are quite good at it, but the problem is they have limited tools and capabilities, right? First of all, most of them haven't moved to a cloud system. And they're using some very basic tools, rule building tools to build these solutions. And additionally, they don't have the label data set to apply machine learning, right? So because of these different factors, because we've built a system in the cloud that can run at immense scale with significant processing capability, we're able to come at this from a different angle, right? And I think that's what we need to illustrate when we talk to these banks is, yes, you guys are good at models. We've got this infrastructure over here that's very efficient and effective when we apply machine learning. In a lot of cases, I think the approach is to look at them as a partner as opposed to replacing them.

Let's go to Christian Bolu from Bernstein.

So Jamie, you've made a big impression on Adena, obviously, because she speaks about you all the time on the call, particularly around sales process and product development. So can you just talk about what Verafin does differently on those 2 topics, such as legacy Nasdaq, and sorry if I used legacy, but old Nasdaq, if you may. And then the second...

I said you got to go easy on me.

The second question is another one again on, call it, Tier 1 bank. So you talk a lot about data as a moat. How relevant or sustainable is that over time, particularly as you move upmarket? I think the largest 3 banks have like 3% market share of deposits in the U.S. I think on Slide 89, you talk about only 3% market share. So I'd imagine big insurance have more data than you potentially could use that data more efficiently. I think there's an exchange -- formal exchange where all the banks submit their data for fraud. I guess someone could use that to build something like you do. So just talk about the sustainability of that data moat over time.

Yes. Okay. That's a lot.

It was like 7 questions. Go.

How are we different from the legacy Nasdaq? Well, look, first of all, we're 3 engineers that have the ability to build a business from scratch, right, 20 years ago when cloud was just becoming a thing, all these exciting technologies were. So we had a clean slate. We adopted agile, lean product development and cloud, all these sorts of things that go together that made us very effective. Nasdaq is a 50-year-old business, and I would not want to have to replace all the things that they've done, but they've done a tremendously good job of moving to the cloud, enhancing the technology and come up to speed. So I think like we may have started in different places, but we're pretty much at the same place today.

So okay. So the data moat question for me. Are you looking to see if he has a little doubt? Okay. So on the data question, again, it goes back to the point of a bank is only -- their data is only as good as what they can see themselves. And what we're able to bring is visibility into transactions that they don't have. And it's really evident from the results of the proof of concepts, right, in terms of whichever dial that the bank wants to turn. Some are really going for detection and are willing to say, "I'll take more alerts as long as you help me prevent some of these kinds of fraud," while others are, "I only want you to generate these amount of alerts, but you need to catch more fraud." And it's been -- in the proof of concepts we've done, it's been really, really clearly evident to them, the power of bringing their data together with the data that we've built and that we have available to us in our network allows us to get to those better results. And I think what's more exciting is that it's still the network effect. It doesn't matter to the institution that's contributing. As more institutions use this, everybody gets the benefit of that network effect. And I think that's going to be the thing which is going to drive this, right?

And so do you have different [ 314(b) ]...

So the primary change in the 314(b) is more of a solution specific for the U.S. that allows them to be able to share information under the PATRIOT Act. So that, for all intents purposes, is completely separate than what we're talking about from a wire fraud perspective. Happy to chat with you about that offline, yes.

Just I'd like to add something to the data because it's a great question. And it has been a tremendous moat, if I can use that word, especially for smaller institutions. I mean literally, there's 65 different core banking systems that serve these small banks and credit unions. And on top of that, there's numerous number of transaction systems like teller systems and check processing systems. So we've integrated with hundreds of these. The difference with large banks is they also have multiple systems within the bank. And these multiple systems are often islands of data that don't integrate together, right? And so what some of our competitors have done is they've partnered with some of the big accounting firms to do the data integration. So each time they do it is different. And so, as an example, we have a product, which we don't talk a lot about because it's a consortium product with some of the biggest banks in the U.S. who use our product to do information sharing, and the competition for that contract was quite stiff with some pretty significant players. We won it because of our expertise with data and ability to bring data together from their systems in such a way that it was consistent across those 5 banks, which our competitors couldn't do.

Thank you. And one last question on the segment. Let's go to Owen Lau at Oppenheimer.

Is there any opportunity of deploying your AI and ML capabilities into the crypto space outside of trading? So we have seen some big headlines over the past few days about big corporate exchange, and we're not sure whether this is we or just people spreading around boomers. I mean is this something your tool can be applied to increase the transparency and confidence in this space?

So a tool can definitely be applied to the crypto space, and we are developing functionalities as we speak. As Rob mentioned earlier, there's a whole spectrum of artificial intelligence and machine learning, and we use a number of different tools. I think machine learning, that might be a little bit premature in the crypto space right now simply because there's not enough cases to create enough labeled data to train the algorithms. But certainly, over time, as the criminals start to move more activities to the blockchain, and we start to accumulate what we call ground truth data, we would be in a prime position to start training our machine learning algorithms to detect that type of activity as well.

Have you started getting like [indiscernible].

Yes. Yes.

Okay. Thank you. I want to thank Jamie and his team here. And next, we're going to have a panel discussion on the topic of, How Nasdaq Adds Value to Clients During Economic Downturns, and we'll take just a moment. [Break]

Okay. Thank you. For this panel, we're going to have moderate Phil Mackintosh, Nasdaq's Chief Economist and Senior Vice President and the author of a very informative and always educational Market Makers newsletter. Phil joined Nasdaq in 2018. Before that, he held positions as Head of Trading Strategy at both Virtu and Credit Suisse. Our participants on the panel include Jeff Thomas, who has recently been named EVP overseeing Nasdaq's U.S. listings and global IR and ESG businesses. Jeff joined Nasdaq in 2014 and has been Chief Commercial Officer for the Corporate Platforms business. Brendan Brothers, who we've met already, is the co-founder of Verafin, and Brendan, a software engineer initially with specialized knowledge of robotics, behavior-based analytics and probabilistic networks, has used his expertise to support all aspects of the company since its 2003 inception. And then Oliver Albers, Capital Access Platforms, EVP, runs our institutional investor and asset owner, analytics and workflow solutions, our index solutions and our market data offerings. Oliver has been with Nasdaq for over 2 decades.

All right. Thanks, Ed. And I thought I might start just by talking about the end of our topic, just thinking about the economic outlook first and then come back to how we see the customers reacting to it. Obviously, at the moment, the focus is all about inflation. I think the electors today are going to be focused on inflation. Clearly, the Fed is very focused on inflation. And basically, the Fed and a lot of economists keep getting inflation wrong. They keep getting surprised by how strong unemployment is or employment is, and I keep getting surprised at how persistent the inflation is. The expectation now is obviously for rates to get close to or over 5% sometime next year. Although I would say the bond market is already pricing that in, we know that the 2-year, 10-year yield is very inverted, and that typically leads a recession, which has got a lot of people talking about a recession. I'd say that stocks being down 20% to 25% have already priced a lot of that in as well. I think the general expectation is we have a softer recession than we've had in the more recent past, and part of the reason that I think supports that is the strength in the consumer. The reason that we have some inflation flow-through is just the strength of the consumer, the spending, the transferring out of bank accounts into credit cards and sort of holding inflation up; the fact that we have strong jobs data, which means no one's worried about losing their jobs, which is also supporting the spending as well; and also the balance sheet that the consumers have coming out of COVID. So I think there's a few supportive factors that do support a softer recession. The other thing I think about the fear of a deep recession is a little bit of a recency bias. And if you think about it, COVID was the deepest recession we've had since the Second World War. And the credit crisis was the longest recession we've had since the Second World War. So they're both a little unusual. Lots of the other recessions we've had in the past have been nowhere near as deep as them. The other thing that people do tend to ask me about is the parallels with the '70s, where obviously, Volcker had to get rates up to 20% just to tackle inflation. And obviously, that has a bigger impact and it had an extra impact on stock market valuations and did cause pretty deep recessions. I think we're a bit different than the '70s for a couple of reasons. And one of the key ones, I think, is the demographics. So if we look at the demographics back in the sort of '70s into the '80s, we had a lot of immigration. We had a young workforce. We had a growing population. A lot of those things have been changing not just in America, but in the whole Western world, where workforces are aging, the populations are shrinking. And just naturally, the level of GDP that the economy can sustain has been starting to slow. And if you look at the peaks of interest rates ever since the '80s that we've needed to slow the economy, it's been falling lower and lower and lower. And already where we are is breaking that down trend. So if we think about rates at 4% already, a lot of the leading indicators are actually showing a slowing in the economy. You've got the PMIs. The manufacturing sector has been slowing for well over a year, and it's now flat to slightly contracting. You've got the services sector, which obviously came through later with all the vaccines coming through. It's definitely the growth rate is slowing and you're starting to see people or the growth report slowing down there. You look at the wages, they look like the growth in wages has turned. And I think that particularly things like the housing sector are getting affected much more quickly. So you can see a big slowdown in mortgage applications, and that's starting to flow through into housing prices and spending in the residential construction area. I think it's probably positive to see some central banks already looking to do a pivot, and you had Canada and Australia, in the last month, slowing down their rate rises. So theoretically, the interest rates at 4%, expected to get to 5%, is not really stretching where we're already out in the bond market. So it does support a relatively mild recession.

So with that, let's talk about Nasdaq's customers. And I think the first place I want to start is with the issuers. So Jeff, with the decline in valuations and all the volatility, how does Nasdaq support corporate clients?

So since COVID began, about half of publicly listed companies are down by over 50%. So that means that their shareholder base has likely turned over. They probably had to adjust their strategy and start to really think about focusing on profitability over growth. And so that leads to some really existential questions for our company. Who are my new shareholders? What parts of that new strategy are resonating? Who are the investors I should be targeting for potential investment? And of those investors, who are seeing inflows into their funds? So our investor relations franchise is set up to help companies around the globe answer those questions. So our equity surveillance offering helps companies to identify who their shareholders are. Our perception studies will help them to understand which parts of their stories are resonating. And our investor targeting services will help them to identify not only which investors are likely to buy their equities, but also we can let them know who has funds flowing into their funds. And so you take all that and add it on top of all the demands that are coming in corporates around ESG disclosures, we think Nasdaq is in a really good position to help companies that are going through this market volatility.

So what about ESG? That was a pretty popular topic the last couple of years. We've had inflows into investment funds. Was that a bull market trend? Or do you see that continuing?

We see those demands increasing on corporates every day. And so as Adena mentioned, it's 1 of the 3 key megatrends that we're focused on here at Nasdaq. And when you think about it from a public company perspective, you not only have demands from investors, but also their customers are asking for more and more ESG data. Their employees are looking for it, their communities. And of course, Nelson mentioned, we have the potential tailwinds of regulations coming into force, both in the U.S. as well as in Europe. And so when you think about it, all companies are at a different stage in their ESG journey. It's very different if you're a small cap versus a large cap. Nasdaq has assembled a portfolio of solutions to help companies throughout that journey. Our ESG advisory service will help companies to map out and understand what their peers are disclosing and what they should do to build out their ESG framework. Our Metrio platform helps them to track their key performance indicators and measure those and disclose them internally through dashboards and externally through ESG reports. And finally, our OneReport offering helps corporates map those metrics into the raters and frameworks out there that are measuring their success. So we've got a really holistic set of services to help companies deal with these challenges that are emerging every day.

Will a recession affect retention rates, though?

So one of the great things about our portfolio of services is they're really core operational aspects to how public companies operate. So if you look at, for example, our governance solutions, that's how this company run their Board meetings, how do they manage their compliance solutions, how do they have an effective Board of Directors. That's probably not something a company is going to want to reduce their spending on as we go into choppier economic times. That when you look at the size and the breadth of our offerings, we're one of the top providers in each of the key areas around IR, ESG and governance. And so we see a trend of companies wanting to work with fewer, more strategic vendors. So I think all of those things are leading us to having strong retention rates. Now Phil, one thing that issuers always ask us about is what about the markets? Things are really volatile. So I know your team does a lot of work around kind of changes in trading dynamics as we go into volatility.

Yes, I would say, my team spends a lot of time looking at the secondary markets. And I would say, net-net, they're countercyclical. So when you see an environment that has a lot more uncertainty, when you see an environment where macro news is coming through more impactfully and more often, you actually see more trading opportunities. And that really relates to or translates to more shares trading and more of an urgency to trade as well and a need for more certainty on the prices that people get. And so that actually also transfers a lot of the trading that increases onto exchange just because we have advertised quotes that are actionable and you see market share increase. So we talked about trading, let's turn to investor clients. And Oliver, can you start by giving some overview of the type of clients you cover in investment intelligence and, broadly, what challenges they faced during an economic downturn?

Sure. So starting very broadly within capital access platforms, we cover the entire investment community from retail, online brokers, helping individual investors with their self-directed trades to financial advisers to banks and market makers to asset managers and finally, to the asset owner community, so how we service a lot of the largest pensions, foundations and endowments. And across the board, we hear common themes. And one of the most common ones we hear, a need for cost savings and efficiency. And that's actually an opportunity for us when you think about the fact that we have content sets that can help save investors' money. A perfect example of this is NASDAQ Basic, which is now one of our most popular products. Actually really came to fruition and increased tremendously in popularity during the 2009 financial crisis when a lot of our customers had urgency to go through the implementation in order to save the millions of dollars that they could. And to date, NASDAQ Basic is saving the industry over $400 million since its launch. On the efficiency front, we see a great opportunity leveraging technology and modern APIs to help clients be more efficient in their consumption of data. So this helps them reduce their infrastructure and their overall technology footprint to save money there. And then finally, across our entire ecosystem, there's a need for new insights. Everyone's trying to understand what's happening across the broader macro economy, the sector level and even the individual company level. So providing content that can provide those insights is a big opportunity for us.

So getting more specific, what challenges do your asset owner customers face during a downturn?

So asset owners are a bit unique, and they have huge challenges managing their portfolios in times of uncertainty and volatility. And Solovis was actually born, again, out of the 2009 crisis where asset owners needed more real-time information and insights as to their risk and opportunities within their portfolio and really, really understanding it to a detailed level. I think we heard that firsthand from [ Lucera ] in the video earlier. So we've also not only enabled them to manage their portfolio, but we've integrated Solovis with eVestment. So now they can transfer their performance into eVestment to understand how are they performing against peers, run what-if analysis and all sorts of other analytics on their portfolio. And then finally, when you're thinking about the need to shift allocations, it's extremely important for asset owners and their consultant partners to really go through proper diligence of the asset manager community. And so eVestment provides key services and is the leading provider of helping provide insights and transparency in terms of asset managers, helping them find the right partner for their next allocation.

So speaking of their partners, what do you see and hear from asset managers during a downturn?

Yes. So asset managers are a little different. During a downturn, asset managers, it's all about attracting fund flows. And so we work with marketing professionals and IR professionals and asset managers really to help them focus their efforts on the highest value opportunities, using their limited resources to find the highest ROI using eVestment. And we -- it not only helps them kind of position their marketing efforts but also with their product portfolio. Are there gaps in their product portfolio? Are they -- are their competitors getting traction in certain areas? And so then it helps them understand what products they need to bring to market. Additionally, it helps them understand why they're losing mandates. And so it helps their competitive position, increases their win rate. And then finally, on the asset management side, obviously, we have a huge index franchise we've talked a lot about today. And we work with our index clients throughout all market conditions. But it's been really interesting to me that, during downmarkets, we're actually as engaged as ever and demand is as high as ever for us to bring new products to market. So they have products to market when the markets come back. And frankly, there are also products that investors find interesting in times like these. So we see a lot of demand for thematic indexes, as we mentioned earlier, yield-generating strategies and, of course, ESG as well. So -- and then finally, on the index side, obviously, we covered this a little bit during Tal's panel, the ability to allow asset managers to hedge their risk via derivatives linked to our indexes as well. So when we look across capital access platforms and how we service investors, we're really thinking about from a long-term strategic partnership, how do we work with our clients to help them manage not only 2 economic cycles but through economic cycles.

Okay. So let's talk about how we interact with our bank sector customers. And for that, I'm going to turn it to Brendan. We've heard today, there's 3 major areas where Nasdaq helps banks from an anti-financial crime perspective, money laundering, fraud and surveillance. Let's start with fraud.

Sure. And then we'll come back to anti-money laundering. Fraud -- I guess fraud is probably the easier one to talk about as a starting point because I think in the same way that you kind of described the countercyclical nature, what we sometimes see and what we've seen in past history is that as the economy goes down, the opportunities for fraudsters go well, right? And often, even -- if you think about the opportunities for fraudsters, it's oftentimes the victims of fraud become more willing to fall for the scam, for example. So Jamie highlighted some of these in the presentation. When we think about fraud that's being perpetrated against individuals, we think about online romance scams, elder financial abuse, really, really difficult problems that go to that core purpose of trying to fight against financial crime. And a lot of times, those increase in times of economic uncertainty. Similarly, some of the kinds of things we talked about from a payments fraud perspective, those tend to increase as well. I mean we -- using the pandemic as kind of a recent example of that, I know Jamie highlighted, for example, some of the things that we saw around PPE fraud and things like that. But when the stimulus came about in reaction to the pandemic, that opened up a number of doors for fraudsters as well. And because of the cloud-based nature and the agile development process that we have, we were able to actually partner with customers really, really quickly to be able to identify those types of behaviors, build out analytics and then release it to the entire cloud. And I think, again, one of the things Jamie said is we kind of have this write once, deploy many type approach to analytics across the AFC division. We're able to see a couple of those examples with some of our larger customers, but then make those kinds of analytics available to all financial institutions. So that kind of core competency that we have in terms of identifying those kinds of trends across the cloud, being able to reactively -- react to that really quickly and get new analytics and detection capabilities out is really strong. And I think that might only become more prevalent as we think about some of the trends again that we talked about in the earlier presentation where, right now, a lot of those lost to scam victims, for example, are the losses on the victim and not on the financial institution. So the banks see this as a reputational risk for them, right? No bank wants to be in the news because they're letting elder financial abuse or small business abuse like that happen. I think there might be some interesting things as we foresee regulatory changes regarding that liability shift and others that might change that in the minds of some of our customers.

Okay. I would have thought regardless of the economic climate that banks are still required to follow regulations. So how does that affect you from an anti-money laundering and surveillance perspective?

Yes. I mean you're absolutely right. I mean compliance isn't always here forever, right? We know that, and everybody in the room knows that. I think what we see is kind of 2 main themes around this idea, particularly in our customer base, it's not just the regulations that our customers are under today. but it's the change in regulatory landscape, which is now coming around the same time as this turbulence within the markets. We see changes, for example, to the AML regulations in the U.S. We see proposed changes to regulations in the U.K. The always-and-forever ideas around market manipulation and things like that, that we see from the surveillance perspective, those are always there. And then we talked about crypto as well, where we have kind of the, I guess, the entry into potential new regulation within that. So I think there's no shortage of drive for financial institutions from a regulatory perspective. I think what we mainly see within that area, as Rob touched on a little bit earlier, is that drive for efficiency, right? I have to do this. I have to comply with regulation, but help me actually do that in the most effective way possible, right? Get me to a place where I don't need thousands of analysts looking at alerts and things like that. So when we think about some of the kinds of capabilities that we've built out from a detection perspective, applying advanced analytical technologies across the cloud, those are obviously helpful. But we don't discount even the way that we build our products and the way that we actually allow users to be able to work through alerts within the system. A couple of years ago, we started a major exercise with some of our larger customers to really try and identify what's the most effective and efficient way to be able to actually get through alerts. And it was a combination of working with the customers through observation but also instrumenting the applications that we could see how much time was being spent on different areas. And with a lot of the work that's being done right now within the AFC group in terms of modernizing the user interface, being able to bring kind of this new platform to life within AFC, I think there's lots of opportunity for us to be able to allow the platform to be able to inform how we can allow customers to get better and better. Because as we say, regulation is not going away. It's all about how we can actually help customers be that much more efficient as they try to deal with those regulations that they have in front of them.

Okay. So I have a question for all of you, each of you separately. If we think about the 2007, '08 recession, that was a pretty deep recession, maybe call it a stress test, where stock valuations fell as well. What lessons can you draw from the experiences your businesses had during that period? And let's start with Oliver.

We'll start with me?

Yes.

Yes. Okay. So generally, I mean, I think overall, our business was really resilient throughout the financial crisis in '08 and '09. And generally, I think it stems from just listening to clients, understanding what their needs and being proactive on that front and having the right products to market. So I mentioned NASDAQ Basic. I mentioned a lot of what we're hearing from a tech perspective now in terms of providing efficiencies to clients. And so we feel pretty comfortable that, especially what's different now is the fact that we have a much more diverse product suite serving a much broader client base, and I think that's helpful. But all along, we've provided mission-critical services to clients, which I really think helps us maintain our business throughout -- through economic cycles, as I discussed earlier.

Okay. How about, Brendan? I know your business has grown a lot, but what lessons do you learn from?

Yes. I think when we look back to kind of that time period, certainly, that recession was really focused on the financial institutions themselves. So we saw some delayed buying decisions and things like that at that point in time. But we're in a very different position right now. And I think even the potential recession that we might see here now today is going to be different than what we saw at that point in time. I look back at that, and I see -- even as Oliver just said, right, we had concentration in particular markets, which we don't have right now, right? We have a much, much broader customer base of over 2,000 financial institutions and the kinds of things that we talked about being able to prove effectiveness and be able to prove efficiency. I think those kinds of things are very different for us now in 2022 as we were as a 6-year-old little baby company back at that point in time.

So Jeff, I know from the research that I've done, in '08 and '09, the IPO market was much slower. So what kind of parallels and what sort of lessons you think the listings in the corporate business comes from that recession?

Yes. So if you look back what the corporate business looked like back then for Nasdaq, the client base was much smaller. The corporate services offerings were just in their infancy. And therefore, we had relatively few levers of growth. Now fast forward to where we're at today, we have 10,000 clients around the globe. We have a really nice diversified revenue base internationally because of those corporate service offerings. And because we have an expanded portfolio of services, we have a lot of additional growth drivers in different ways that we can add value to our clients during a downturn. So I think we're in a much better position today than we were back then.

Okay. Interesting. So just to, I guess, wrap this all up, I think it is fair to acknowledge that in a recession or a slowdown, whatever we get, we know that clients are going to be dealing with declining revenues and some challenges on cost of their own. But it sounds to me or I feel like I've learned that we have a pretty diverse group of customers, from issuers and corporates to investors, to banks. And we also have quite a diverse set of products, some of which are designed to help customers manage risk and also manage finding their customers and finding investors during times like this. So with that, I'd like to thank our panelists, Jeff, Oliver and Brendan for spending time with me and with some of our investors and hand it back to Ed.

Great. Thank you. All right. So next -- thank you, first of all, to the panel. It was incredible to hear these insights and hear about the experiences of you and your business in prior economic cycles. Very much appreciated. All right. After we clear off some chairs here, we're going to have Ann Dennison, our CFO, here to talk about our financials and sustainability.

So I'm going to bring us home here, at least, before the last Q&A. And then lunch, hopefully, you can join us for that. I've got 4 elements to my section. First, we're going to talk about strong performance. You've heard a lot about our strong performance, but I just want to sort of bring that home for everybody. We're going to then sort of move in to talk about the resiliency of our business. I'm really glad I'm following that last panel session. So we're going to dive in a little bit more there and talk about what we're doing on the planning front. Capital allocation, third topic. And then finally, we're going to talk about what our ambitions are and how we're going to measure ourselves against those ambitions. So let's kick it off with our strong track record. So we've had stellar performance over the past 5 years. Going back to 2017, 9% CAGR on our net revenues, 16% CAGR on our non-GAAP EPS. What's the differential? That's 500 basis points of operating margin expansion. So a true demonstration of the scalability and the leverage within our business. And that's all translated in our ability to take our return on invested capital from 7.8% in 2017 to 11.5% last 12 months '22, a 370 basis point increase. So on this next slide, we dial a little bit -- down a little bit on how we did that. And so our solutions businesses, which we're talking a lot about today, if you look back at 2017, we had 4% revenue -- organic revenue growth for our solutions businesses. If you look at the average between 2018 and today, that looks like 9%, so more than a double, and that's a result of the strategic pivot and how we've thought about our investments over time. So what does that translate into? I mean really simply strong returns for our shareholders. Since January 1, 2017, we've had an annualized TSR, total shareholder return, of 21%. We've outperformed the S&P, the Western exchanges and the expanded tech software, ETF. If you look just back to our Investor Day in 2020, we've had an annualized TSR of 23%, outperforming all of the sectors that we compare ourselves, including the info services sector. So that's on the financial side. And as Adena sort of started off the day, we're really pleased with our financial performance and what the pivot has done for us, but we're just getting started on taking advantage of the opportunities in front of us. Let's talk for a moment about our performance on the ESG side. So what this slide shows you, just gives you a flavor for what we're focusing on. I mean we're focusing -- and this is about our corporate ESG strategy. We're focusing on all 3 pillars. So on the E, we're focusing on moving -- reducing our client footprint through the implementation of science-based targets. We're focused on creating diversity or increased diversity across all areas of our organization, and we're focused on continuing to advance our very strong governance practices. And all of that is being noticed. So if you go back about 5 years, we were probably in the lower end of the spectrum from a rating perspective. Looking at us today, we are in a leading position in our industry for MSCI, IFS and Sustainalytics. Only 5% of the S&P 500 can make that claim. We've also received a lot of accolades. I'll highlight 2. We're on Seramount's list of the best 100 companies to work for. And we've also been recognized as a best place to work for LGBTQ professionals. So what does that mean? What does that do for us? So I will highlight lots of things, but I'm going to highlight 2. One, that helps us attract and retain the best talent. Our employees, they want to work at a company that is forward looking from a corporate ESG strategy perspective. And two, it really broadens the possible investor base for us. And so that's how we think about the benefits there. So that's on the track record. So now I'm going to move a little bit into resiliency. So Nasdaq is a resilient business. We heard about that in the last panel session, but I want to highlight a few things. If you look at our revenue composition, 75% of our revenues are in our solutions businesses. For those businesses, they are overwhelmingly recurring revenues, and what those -- what they reflect are strongly embedded product sets that are critical to our clients' workflows. So a really, really important part of serving our clients. Less than 15% -- if you look at the middle part of the circle here, less than 15% of our revenues are in businesses that are tied to -- revenues that are directly tied to changes in market value. So what are some examples of those? That's our asset-based index fees, our European market -- European trading on market value. And so what that means is as the market pulls back or we see corrections, we have less exposure to that. Then we do have 25% of our revenue, which is tied to trading, but the trading business is largely countercyclical and usually puts us in the -- puts in the best results [ during ] turbulent market times. So the net of all of this is that our EBITDA volatility empirically is low. We are on the low end of the spectrum if you compare us to the largest North American markets and the largest North American exchanges and largest European exchanges. So we have a resilient business model. Let's talk about today's environment. We are carefully managing our businesses to ensure that we can capitalize on the opportunities in front of us in this type of environment. You heard in the last panel session how we're serving our clients. And we want to recognize what our clients are facing in this environment and serve them in the best way possible. And we want to continue delivering to shareholders. 2022, we took some actions. There was a tight labor market. We saw some inflation there, and we took some actions to attract and retain the best talent to help us move our long-term strategy forward. And we felt like those are really important actions. What that ended up doing is creating about 2% of our organic expense growth related to some of the actions that we took to respond to the high inflationary environment. All of those increases were absorbed by what I would describe as pretty typical price increases. So let's look forward. As we look forward and we look at those businesses across Nasdaq, where we have pricing power and typical pricing increases, with those pricing increases, we can absorb 2% to 3% of inflation on our expense base without changing our very strong margin story. In terms of our sensitivity to an economic recession, we could see directionally offsetting implications between our solutions businesses and our trading businesses. So on the solutions businesses side, we may face some short-term headwinds around growth, while on our trading businesses side, those businesses typically form -- perform the strongest during turbulent market times and difficult backdrops. We are recession planning. So we are looking at different severities of recession and different durations of recession and building a financial plan around those to prioritize what investments we will continue to make to drive the business forward. We feel great about the positioning of our balance sheet against this rising rate backdrop. We've strengthened our balance sheet over the past few years with really smart decisions to refinance ahead of the raising -- the rising rate market, and we've structured a really well-laddered maturity schedule. So currently, we have a -- roughly a tick above 2% pretax cost of debt, which we have very minimal exposure to floating rate debt. So it's de minimis now. We've got some debt that's coming due at the end of this year, which we plan to refinance with commercial paper, but then we're going to pay that down as we move through 2023 with our strong cash flows. So ultimately, we recognize the environment we're in. We feel confident we've got a diversified business. You heard about that on the last panel session a bit more. We also have a strong track record of being -- of managing our expenses diligently. So when you put those pieces together, we feel pretty confident we can weather any storm and invest through it in order to achieve long-term success. Okay. So let's shift down and talk about capital allocation. So we are very good at turning our operating profits into free cash flow. We've -- since 2018, excuse me, we've had 108% free cash flow conversion rate. And we have a strong core that provides healthy and consistent cash flows. We've got a CAGR since 2018 of 12% on our free cash flows. And in the last 12 months, we've generated $1.4 billion in free cash flow. So how do we think about using that free cash flow? What I have up on the screen here now is our -- the 4 pillars of our capital plan. If you were with us for the last Investor Day, these should be familiar. We haven't changed our approach to managing our capital allocation. We've got 4 key pillars. The first -- first and foremost, invest to drive growth. Second, we want dividend growth in line with earnings and free cash flow growth. We repurchased shares to offset dilution, and we manage our leverage to maintain our investment-grade status. So I'm going to dive a little bit and further into each one of those. So let's spend a minute on investing to support growth initiatives. So here, we are -- and this has been mentioned throughout all the presentations today, we think first about those organic investments that are in front of us, and we invest in those. We also think about strategically -- to the extent that there's something inorganic, if it's strategic and it meets our return profile, we want to be opportunistic there. We do all of that investment in the context of achieving a greater than 10% ROIC and a greater -- and an ROIC greater than our WACC. Through the strategic pivot, we've really focused our investments in areas that are going to accelerate growth. So if you look back on the -- I guess, it's on your left-hand side of the chart, between 2015 and '17, we were investing about 30% of our R&D and CapEx in those investments that are -- that would accelerate growth. Let's forward to '21 -- to '20 now -- to now, that looks more like 70%. We did that while still investing in the core because that is the foundation. We want to sustain and expand it from its already strong positioning. We've made some key strategic inorganic investments in eVestment and Verafin that have not only helped us meaningfully reposition our company, but also have performed in an outstanding way. And then last but not least, we've established a scaled and effective venture investment portfolio, which brings outside capabilities into better reach for our products and services and has generated outstanding returns. Okay. Second pillar of our capital plan, a consistent and compelling dividend story. The compound annual growth rate of our dividend has been 10% over the past 5 years. We grow dividends in line with earnings growth. And as we look forward over the next 5 years, we have an ambition to take our payout ratio back to the 35% to 38% range. It's around 30% right now. And so in combination with that ambition and our strong income growth potential, we have an incredible opportunity to deliver a double-digit dividend growth story moving forward. Third pillar of the capital plan, repurchasing to offset dilution. We have designed and consistently executed our share repurchase program to offset dilution. We purchased -- over the past 5 years, we purchased roughly $165 million to $175 million a year to offset employee-related dilution. But we also purchased 18.6 million shares to eliminate the dilution related to the sale of our U.S. fixed income business. And we've maintained a stable share count of approximately $500 million since 2018. We expect to continue this strategy, not changing it. We will be opportunistic if 2 things happen: one, if the share price is particularly -- or exceptionally attractive; and two, if that's the best use of our cash. Okay. Fourth pillar. So we are managing our leverage and our balance sheet to maintain our investment-grade rating. And we believe that -- and we do this because that is the best way to execute on our long-term strategy. So -- but I just want to dial in on this. Our balance sheet is stronger than it's ever been. Our leverage ratio is at 2.7x. That's the lower end of where we've been operating over the last 10 years. Our cost of debt is low, just a tick above 2%, and we have no long-term debt maturities until 2026. So this strong capital position really gives us a lot of strength against the rising rate backdrop and really provides us capacity and opportunity to invest to drive growth as we move forward. Okay. Final section. We're going to talk about our ambitions and how we're going to measure ourselves against those ambitions. So you've heard from all the division leaders today about each of their medium-term objectives. So as a reminder, that's their 3- to 5-year outlook on revenue growth. And so you can see those all up on the slide. When you put those all together, for our solutions businesses, that translates into a 7% to 10% medium-term outlook on growth. And what I really want to stress here is that there's a couple of things going on. This is a solid step forward from the 6% to 9% that we had previously and -- because there's 2 things happening. Obviously, we're taking it up a percentage point. But now the 7% to 10% is really covering a bigger portion of our business. That 6% to 9% covered about 66% of our revenue base. The 7% to 10% is covering 75% of our revenue base. The last thing I'll highlight on this slide here is that -- and Adena mentioned this earlier, but I just want to repeat it, we're continuing to shift the portion of our business that's Software-as-a-Service. And back in 2020, we told everyone we wanted to, by 2025, get our SaaS revenues as a percentage of our annualized recurring revenues into the 40% to 50% range. We are well on our way to achieve that in 2025. So now we want to up the game a bit. And we want to -- by 2027, we want to be over 50%. So what investment is it going to take to drive that growth? We are adjusting our medium-term organic expense outlook from 3% to 6% to 4% to 7%. And this here is another thing I really want to stress. This is not about just increasing our expenses. This is about the evolution of our business and how more and more of our business and our revenue and expense mix is in our faster-growing parts of the business, so our AFC technology, our workflow and insights businesses. And so this increase really reflects that shift over time. We also continue to invest thoughtfully and to sustain and expand our foundational businesses. And in the short term, I just want to remind everyone, as we think about expense growth in the short term, we really think about it in the context of our solutions businesses growth. Our solutions, the 7% to 10%, that represents 75% of our business and the vast majority of our expenses. So as we think about that against the 4% to 7% expenses, that's how we calibrate ourselves. And so we'd expect to be at the top end of the range, as we have been this year and last year when we're doing -- when we're outperforming our solutions businesses' expectation or outlook and at the lower end of the range when we're at the lower end of the range. So when you put all the pieces together on revenue and expenses, we can -- we expect to continue to deliver on Nasdaq's strong margin story going forward. Okay. How are we going to measure our success over time? I'm going to go really quickly here. I think I've talked about most of this. So one -- first of all, we want to achieve our medium-term outlook. And medium term, again, is over the 3- to 5-year period of 7% to 10% growth on our solutions businesses. Two, we want to manage our expenses for more moderate increases to ensure we have continued operating leverage. Third, we want to reinvest deliberately and thoughtfully, maintaining a double-digit ROIC for our investors in the enterprise and above -- and definitely above our cost of capital. And fourth, we want to reduce our client footprint in accordance with the science-based targets that we've implemented. So if we execute all 4 of these pillars, we put ourselves in an incredibly strong position to continue generating double-digit total shareholder return for our investors. In closing, we have been successfully executing our strategy, demonstrating strong performance. We are proven to be resilient across many different economic backdrops. We have a capital plan that we have consistently executed to drive attractive returns. And our performance potential continues to grow. So thank you very much.

Okay. Great. I'm going to ask Adena and the other divisional leaders to join Ann on the stage for a final Q&A portion here.

Let's see here. Okay. Some familiar suspects here. Let's start with Michael Cyprys from Morgan Stanley.

Great. Thank you. Thanks for all the time today and the information. Just a question on maybe a topic that was not addressed today, and that's the private market business. Understand you're now a smaller owner and a bigger business. So can you just talk about some of the initiatives there just around broadening out distribution, any traction updates that you can share, how you think about expanding the product sets as well? I think initially, it was maybe more companies that you're trading, but we also hear about others in the marketplace that are looking to tokenize private funds. So just curious how you think about the broader opportunities out there.

Sure. Yes. So our Nasdaq Private Market business is really geared towards and focused on what we call private company shares. And it is in partnership now with 3 major banks -- or 4 major banks, sorry, but Morgan Stanley, Goldman Sachs, Citi and Silicon Valley Bank. We now have a new CEO in Tom Callahan. He came -- he joined us from BlackRock. He's fantastic. And so we are continuing to expand the mandate of Nasdaq Private Market. We've always been the premier provider and the largest provider of tender secondary transactions. And that is kind of the cornerstone of the business. But recently, we've been also helping what we call company-sponsored secondaries, company-sponsored like block trades where investors are looking to sell their positions or investors are specifically looking to buy into positions. And instead of having that go through what I used to call kind of the backdoor channels, companies are saying, "Well, let us be a part of that. Let us make sure that there's a data room that's accessible, make sure that the transactions are done with proper information sharing." And so we're starting to facilitate those. And I think that, that's a huge opportunity for us over time. But that business continues to be kind of a small but really exciting and interesting growth story for us. And as we continue to work with them, we're on the Board. Gary Offner is the Chair. I think that we have an ability to continue to catalyze growth in that business going forward. We're pretty excited about it. Now on private funds, that's a different thing. And that actually we're still -- we have within Nasdaq. So within our Investment Intelligence business, we have something called a private fund secondaries marketplace. And we, basically, are leveraging some of the same technology, but we actually have rewritten that platform. So it's a Nasdaq internal platform now. And that's actually embedded in Oliver's business -- sorry, in Nelson's business, where we are actually very actively working on secondary transactions for GP-led secondaries as well as LP-led secondaries, where they want to be able to transact and do basically transfer ownership of fund interest. What's great about that is it actually ties into Solovis, right? So asset owners are looking to make -- change their asset allocation. They can go into the fund secondaries platform, place their order into that platform, and then also transact that. So we kind of create this more complete life cycle experience for asset owners. They make asset allocation decisions with eVestment. It flows into their portfolio management module at Solovis. And when they want to make secondary transactions in our private portfolio, they now can use the fund -- the secondary funds platform. So I'm really, really excited about what that can do for us, and that is one of the growth drivers in Nelson's business.

Why don't we go in the back to Michael Cho from JPMorgan?

Ann, I just want to go back to your section that you just went through just now. Just on your comments around, I guess, the pricing adjustments. I guess I'm just trying to get a little bit more color on how those work. Is that contracted? Or are you going back to have discussions with clients around these pricing adjustments? And maybe you can remind us what kind of pricing has been in the past for these solutions that you're referring to with the pricing adjustments and maybe how that actually ties in or doesn't tie in to the 7% to 10% -- or sorry, this 7% to 10% organic growth targets?

So I'll start and then maybe the business leaders want to talk a little bit about it. So pricing adjustments are tied -- are built into the -- to our medium-term outlook of 7% to 10%. And they are a combination of things. Some of those are built into contracts as CPI escalators depending on the business, and others are price increases that we typically do every year or every other year depending on the products. And so it's a combination of things, but it is built into our estimates. Do you want to give some more color?

I don't know if you have any more color to add. I think that you tend to kind of look at changing the pricing as contracts are renewing with your clients and you have about 3 -- generally, 3-year agreements.

Generally, 3-year agreements. And -- some of our contracts have a 7% annual increase built in as well to continue to drive R&D.

Okay. And then, Nelson, within your business, how do you handle that?

We just have a real wide range of products. So it's hard to give you a general answer on that, but we do go product-by-product and some we definitely have pricing power. Others are regulated businesses. So we really do go product-by-product and think about how we can -- we maximize the value to our clients and make sure we're getting paid in return.

I think within the trading business, it's like an every month kind of activity to manage pricing. But why don't you talk a little bit about that across all of the market platforms?

Yes. So just on the trading business, you're right, we also have to go to the SEC and work with the SEC. And what we're trying to do and work really hard at is demonstrate the value of our products. So when we go back to the SEC, and that's why we talk about cloud and these new services we're offering, so we kind of moved that into a value-based discussion. We got strong demand for a number of these products. But again, it's something that we work with the industry on and the SEC. And then our market platforms, more generally, Roland's business, he's got long-term contracts. And clearly, those are ones that we'll take a look at over the next couple of years.

Yes. So they tend to -- some of those contracts do have CPIs later, some don't. It really depends because it's individually negotiated. I would only say we do take a long-term approach to this, right? I'm a huge believer in creating long-term value for our clients, developing long-term partnerships with our clients. We're not going to maximize price every year. We're going to maximize for value over the long term, and that's the way that we approach our pricing changes.

We'll take the next question from Gautam Sawant from Credit Suisse.

I wanted to talk a little bit about regulation and what the impact could be on maybe the market data services you have and maybe some of the other areas of the business. How do you expect regulation to shift for maybe your lit market offering and coming back to analytics and the market data side?

Sure. I'm going to let you talk about from the trading side. And maybe since I've been in the data business for as long as I have, I'll take the data side. Then go for it.

Yes, absolutely. So on the market side, we've all heard from the SEC. There's a lot of rhetoric that's come out from the Chair and the SEC around the proposal. We have not yet seen that proposal yet, but I would say this -- it's most likely still early days. It's going to play out over months and years. Those have been part of our business. You know how it goes. And I think there's going to be a vigorous, if you will, comment process, and they're going to see the industry involved. From our perspective, we will be involved with regulators in the industry. But what I'll share with you is that we're highly aligned with the SEC in terms of their mandate and agenda. So we put out a white paper a few months ago by the name of optimize. And a lot of what we incorporated into the white paper you hear now the SEC talking about, whether that's leveling the playing field to benefit exchanges because there were concerns around on versus off exchange. Strengthening the NBO -- NBBO, sorry, and price discovery, that also is near and dear to us. And then finally, there's a lot of talk about best execution and ensuring that exists in the marketplace, not just better execution. So that gave us an opportunity to talk with the SEC in the industry about innovative solutions that we could potentially offer. So I think at a broad level, we're aligned. Words of caution for the SEC, if I could, would be, one, is our equity markets work quite well. So an evolutionary versus a revolutionary approach is something we would advocate. And second, they talk a lot about price discovery, market quality and liquidity, and incentives are important to that. And so that's their objective. They want to promote that. So we just want to make sure that they understand the interrelationships in our marketplace. And so we'll provide them with data. We'll bring in Phil and others and work really closely with the SEC and the industry to make sure that our words of caution are heeded.

And I also just say on the market data front, Oliver and I have both frankly been -- Oliver actually started in the market data business -- actually, you started in the listings business, didn't you?

Listings.

Yes, listings and data. I've managed the data business for a long time. We've been here for 20 years, or I've been here longer than that. And this market database has been going on for as long as I've been working in data. And same with Oliver. The fact of the matter is we provide really great value to our clients. I think we do it in a very prudent way. We offer a lot of choices in terms of the consolidated data and the proprietary data. And the changes that the SEC has put forth with regard to market data that we kind of came out, I think, 2 years ago and are just starting to -- I'm trying to figure out how to implement those over the next several years. Our view is that we have been able to navigate every regulatory environment that has been around since 2020 -- I'm sorry, 2000, and we've been able to be very successful in growing and expanding our data business throughout all of those different regulatory environments. That's the same here. We don't really see any significant change in the opportunity set that we see in front of us, in the way that we're going to provide our data, the technology we use to deliver it, the innovation we bring to the markets and our clients. And I think that partnership approach we've taken with our clients has really paid off in juxtaposing our solutions against what is available on the tape. And yet the tape itself is as good and strong as it's ever been. So I think we feel very good about our positioning as we're managing through those market data changes.

All right. We'll take the next question from Alex Kramm at UBS.

I'm going to ask a boring expense question. So clearly, with the higher guidance rate for the solutions segment, you're also raising your expense outlook as those seem to be very aligned and you mentioned that. But it ignores a little bit the transactional business, which can be very volatile. So I think over the last few years, as volumes have been great, I think expenses have grown as well as part of that. So just wondering at what point if we face a potential volume downturn, which can happen, like do you actually react? Or will you basically let all that flow through to shareholders? At one point will you actually look at cuts? And what areas can you cut?

Yes. I mean I think the simple answer there is, in the short term, we're not going to make cuts to -- that would hurt our long-term growth, but we will be prudent about an environment that may be sustained, and then we think about our expense profile at that point. But like you said, the markets can be volatile, and we don't want to make decisions one quarter to the next that will ultimately hurt our strategy.

Yes. I think that as we also think about it, we looked at -- if you look back on the financial crisis, you really had kind of 18 months where the markets and the volatility was different. And we then ended up in a different volume environment for a period of time, and we were able to calibrate. But we were incredibly resilient during that period of time, about 18-month period, about 2-year period. And then we were able to kind of look at the calibration of our business on the back of that. I think in this particular case, we have incredibly strong growth drivers in our business. We have really good tailwinds. We have investments we really want to continue to make sure we're driving because we do think they're going to deliver long-term value for our shareholders. And if we have a short-term dip in volumes, we're going to kind of look at that and say, you know what, we're going to be able to manage through that. If it becomes a long-term sustained downturn in volumes, which we frankly do not anticipate, then I would say that then we'll start to look at how we calibrate. And we are doing recession planning. It's not like we're not doing it, but we will have to -- we're going to have the time when we would need to execute something like that based on how sustained this type of environment could be. Also could be that we don't find one. I mean I think everyone is expecting something, but I always say that we we're moving right along our path. We're doing extremely well. We're managing to our clients really, really well. And there might be something out there on the horizon, but we don't know if it's 3-feet deep or 30-feet deep or something worse. And right now, I think that our view is that we make sure that we maintain those investments so that we can deliver the best results for our customers over the long term.

Great. Let's go to Rich Repetto of Sandler O'Neill.

First, Adena, I want to congratulate you and your team over the past 5 years of a tremendous job. You've outpaced the other exchanges and a lot from under your control, too. So as we look at the next 5 years, there's 2 aspects I was looking at. First, the mix between organic and inorganic growth. You have to admit that these past 5 years, you had Verafin, you had eVestment, but you also divested slow-growth businesses. But you don't have that. I didn't hear a lot about inorganic mix this time. So you're banking on organic growth this time around.

Yes. I think that we will always look at acquisitions on an opportunistic basis, but we plan our company on an organic basis. The vast majority of our time and attention is spent on how we can grow and expand the business organically. The plan in front of you is based on what we have within our suite of solutions today and how we can grow and expand them organically over the next 5 years. I think as we -- at the same time, we don't ignore the fact that there might be opportunities for us to continue to grow and expand faster or reach out and create new capabilities to deliver to our clients. So we don't ignore the acquisition landscape, but we do want to make sure that we show the strength of our platform as it exists today and our ability to continue to expand it along the lines of what we've demonstrated in our presentation today.

So that actually leads the second part of the 5-year -- looking at your 5-year plan. Because I'm just trying to get your -- as you look back 5 years ago, you did an outstanding job. You have the inorganic part of it in place. What's your confidence that you've identified the key growth -- like who would have thought 5 years ago about anti-financial crime as part of an exchange business? So...

We did.

Yes. I guess your confidence that you've identified over the next -- compared to the last almost 5 years.

Yes. No, I -- a couple of things. I don't know if your mic is on. So I think it's based on like -- we've looked back and we've kind of grown through organic and inorganic efforts over the last 5 years, where do we see the potential for us to go beyond the organic story that we're showing here today to kind of think beyond that in terms of other growth drivers? We are in an incredibly dynamic industry. I mean the capital -- I've been a part of the capital markets for 29 years, and it's -- not a single year is boring. So it's been an incredibly dynamic industry. It's moving -- it moves very quickly. The needs of our clients change. We have an ability to be very nimble and changing with them because we've been moving more and more of our solutions into a cloud environment, making them more agile, more nimble and more complete. We've been rewriting a lot of our technologies, frankly, to be very, very modern and offering them solutions so that we can change with them. We can introduce new capabilities, let's say, into our trade lifecycle technology. We can launch like a new real-time risk management platform in a cloud-native -- as a cloud-native solution. We've built that in a very short period of time to be able to deliver that to our clients. So we have the ability to be very nimble in delivering and growing our digital asset strategy. We've been developing that. And we are -- I mean that's a very quick time to market for us in terms of our ability to leverage all the technologies to deliver that organically. So we have a great ability to kind of move with the market. Our ESG solutions came in over the last 3 years, and you can see the great growth we've had there. But I think, over the next 5 years, what we do is we do an annual review of our strategic framework. We determine what's working, what's not working, how should we continue to make sure that we're refining that strategy to meet the future needs of our clients? And if we see a path to actually grow and expand in a very significant way through acquisition, we will -- we have the balance sheet. We have the capability to do that. But frankly, we're just -- we're very excited about what we can do on our own.

Okay. Great. Let's go to Christian Bolu from Bernstein. Please, everyone, keep the microphone close to yourself to make sure that the virtual audience hears your question perfectly. .

Perfect. I hope everyone can me. So 2 questions for Adena and 2 for Ann. So as Rich mentioned, Adena, you've been key to the stock's success over the last couple of years. So many investors are curious, are you leaving to Carlyle to go be the CEO? So I think that's the first one. And the second question is, outside of the recession panel, this whole presentation feels very 2021 bull market. We're talking about expenses going up, talking about crypto, SaaS, cloud, et cetera. Look, you've done a good job, quite frankly, over the last 5 years. So I think investors give you the benefit of doubt. What are you implicitly assuming the next 5 years are going to look like the last 5 years in terms of free money, high valuations, et cetera, in markets? And then maybe just -- on Ann -- while you think about it, Adena. On Ann, what level does the stock need to be at for each opportunistic buybacks? Is that a dollar number? Is that a valuation level? I'd be curious. And then on leverage, 2.7x, fine, but I think high relative to, I think, just broader markets. Given the higher rate environment, what's the realistic incremental debt capacity you have? Is it still that 3.5% high end of your historical range? Or is it a lower number given higher kind of market rates?

Okay. Okay. So first of all, I am truly passionate about Nasdaq, and I'm very excited to lead this business over the next many years. I've signed a new contract last year for another 5 years, and I'm extremely excited to be here, to be the CEO of Nasdaq in the years ahead. And so I -- that's really the answer to the first question. I believe that as a CEO, it is an all-the-time job. It is a 24/7 job. And to do that effectively and successfully, you really have to be passionate about what you're doing every single day. And I'm truly passionate about Nasdaq. It's why I've been here for the vast majority of my career and why I see a huge amount of opportunity going forward. So that's the answer to the first question. The second question is what we just showed you kind of a bull market type of view as opposed to kind of calibrating to the market environment we're in. I would have to say, I think we've been able to demonstrate that we're continuing to grow really nicely in a highly volatile but also unstable and an uncertain environment. I think that we -- honestly, all of the things that we showed you at the bottom of the page says -- assumes what we call normal market conditions. The last 2 or 3 years have not been normal market conditions. And the next 5, we don't really know what they're going to be. But as we think about the -- what we can do to control our fate and our future and how we can continue to attract new clients, sell our services through different economic environments and provide more value and grow and expand the services we offer, we feel that we're really well positioned to do that in a lot of different market environments. But certainly, we do not assume a bull market. We assume a very kind of normalized, like say, 10-year average type of marketplace in order for us to be able to continue to deliver the growth. If we find ourselves in our sustained recession, we might end up having to look towards the bottom end of our range of growth. But as we -- if we continue to see -- if we see a great recovery very quickly on the back of Fed tightening and everything else kind of coming to a close, and we kind of get to -- get through the next period of time way successfully as an economy, we could also continue to see really, really strong growth across the levers that we have. So I feel very good about our overall market position. I would say the last thing is, as I think about selling through a recession, and I think about what the customers need. If there's one trend that I've heard, I go and talk to a lot of CEOs out there, and there's one just unstoppable force that is coming into corporate America. And that's the digitization of effective processes, internal processes, internal capabilities. And that's because it is a -- leveraging cloud, data centricity, AI and other technologies will make them more efficient, more effective and less reliant on individuals in order to be able to achieve their strategies. And given the labor market as it exists today, they need more of that technology as fast as possible, but they also want it delivered in a cloud-native format because they have to have a low upfront cost. If you have a low upfront cost, the high return on an investment in terms of efficiency, you have a winning product. And I think that's basically what we've been doing here across Nasdaq is making sure that we have a low upfront implementation with a high value on the back end. And as we continue to evolve our market infrastructure technology business, that's why we've been investing so much in our next-generation platform that can be delivered on-prem but in a SaaS format. It can be delivered as a managed service or it can be delivered in a cloud data solution. And that allows that upfront type of investment to be lower with more sustainable, more steady revenue for us on the back end. So I think that we've done a really good job positioning ourselves for this environment.

Okay. Christian, I'm going to answer your last...

I know there are 2 more questions. I forgot what...

I'll answer your last question first because you threw me off with the Carlyle when I forgot your third one. Sorry. So on the question of leverage, so we completed the Verafin acquisition in February 2021. We've been on a deleveraging journey, which we're still on. And one of the things we've done is left -- we've got a maturity coming up at the end of this year that we're going to use commercial paper to fund and then take that down going into next year. When we think about capacity, I guess the answer there is tough to give a specific one. It really depends. It depends on the deal, and it depends on what the EBITDA is of the deal and how quickly we could delever. And so I can't give you a specific answer, but I think Verafin is a good reference point in terms of the transaction and where we took the leverage to. We took it up to 3.9x. And since then, we've delevered to 2.7, and we're still on that journey without a specific leverage target.

We -- I think the big thing is we want to maintain our investment-grade rating, and we work...

100%, yes.

With the rating agencies to do that as we think about strategic opportunities.

Buybacks?

Yes. Oh, buybacks. Yes. What would...

Oh, buybacks. When -- what price would we buy back?. Yes. So I think we've done a lot of modeling. And we have a treasurer here today, and she's a new treasurer. She's done a lot -- we've done a lot of empirical analysis on this. And I think it comes down to -- obviously, we think our stock is attractive at the price of that. So what's exceptionally attractive, I mean, maybe a 20% decline. But even then, it will really depend on what the other opportunities are in front of us and whether that's the best use of our cash to drive returns for investors. So we don't have a price specifically in mind, but we will look at all the factors given what happens in the market.

Great. I think that's a great last 4 questions to end on. I want to thank everyone for coming here and participating online. I'm going to turn it over to Adena just for some final thoughts today.

Great. Well, first of all, thank you all very much. It's really wonderful to have you all here. Great questions, great engagement. We really appreciate it. But I actually want to take a moment to thank Ed Ditmire. Today -- I think today, in fact, is your last day. So Ed has been with us for 13 years, yes?

Almost 9 years.

Oh, 9 years. Sorry. 9 years. It feels longer.

It seemed longer.

Ed has been truly a superb Investor Relations Officer here at Nasdaq. He's really helped us think about the decisions we're making internally and how that he brings the investor into the room in order to help us make those decisions. We don't get to sit there and go tell him afterwards. We actually invite him in and we say, "Hey, Ed, how do we want to think about this opportunity, this change? And whatever we're trying to achieve, please bring the investor in the room so we can think about that holistically as we move forward." And Ed has done an outstanding job. He's also really good at calibrating to the investor audience in terms of helping us understand what matters to you and how we want to continue to elevate our company, but what metrics are going to matter to you going forward. So he is going to be very hard to replace. But at the same time, he's going on to an incredible new opportunity in a totally different sector. So there's a lot of new things to learn, a lot -- a great new adventure for himself. And so we're really, really excited to see and cheer him on as he goes to his next thing. But obviously, we will be working to bring on another amazing Investor Relations Officer into Nasdaq. And in the meantime, Neil Stratton, who has been supporting Ed, has been part of our Investor Relations team for many years now. He's incredible as well. He's going to take on the role with Ann and make sure that you all continue to get great service as we continue to make -- go out and do a search for the new IRO.

Thank you. Well, there's a lot of things I could say, but being aware that I'm right in front of the lunch, I'll sum it up by saying it's been an incredible privilege to tell the Nasdaq story and the story of its unstoppable people, and I've really enjoyed getting to know everyone in the investment community and our always interesting interactions. Thank you for your feedback and so many clues that we use to help ourselves improve. Thank you.

Thanks, Ed. Thank you. Thank you, everyone.