London Stock Exchange Group (LSEG) Q3 2024 TU earnings summary

Executive summary

• Q3 2024 delivered strong organic growth, with total income up 9.5% at constant currency and organic growth at 8.7%, driven by broad-based gains across Post Trade, Data & Analytics (D&A), FX, and equities businesses.

• Tradeweb maintained robust momentum, and the ICD acquisition contributed to growth.

• High cadence of product innovation, including global cloud-based DataScope, new Main Market for UK equities, and enhancements to Workspace.

• Strategic partnership with Microsoft progressing on schedule, supporting product development and digital transformation.

• Acquisition of an additional 8.3% stake in LCH Group for €433 million, increasing ownership to 94.2%.

Financial highlights

• Total income (excluding recoveries) reached £2,117m, up from £1,966m in Q3 2023; total income (including recoveries) was £2,206m, up 8.4% year-over-year.

• Gross profit rose 9.2% to £1,923m, outpacing revenue growth due to lower cost of sales growth (3.6%).

• Organic growth was 8.7% year-over-year, with D&A organic growth at 4.6%.

• FTSE Russell subscription revenue up 13.1% year-over-year; Risk Intelligence up 10.4%.

• Capital Markets growth at 22.4% year-over-year, with Tradeweb and FX businesses performing strongly.

• Post Trade total income up 4.8% year-over-year; OTC derivatives up 18.4%.

• ASV growth at 6.0% at Q3 end, in line with guidance.

Outlook and guidance

• ASV growth expected to remain around 6% through year-end 2024.

• Confident in continued group growth for 2025, even with normalized Tradeweb contribution and ongoing product innovation.

• Modest incremental revenue expected from Microsoft partnership in early 2025, growing over time.

• Pricing increases for Workspace expected to be about 3.5% in 2025, similar to prior years.