Miami International Holdings Q3 2025 Earnings Call - Record Market Share and Strong Post-IPO Growth

Gary, Conference Operator: Thank you for standing by. My name is Gary, and I will be your conference operator today. At this time, I would like to welcome everyone to the Miami International Holdings third quarter earnings call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be a question-and-answer session. Please note this event is being recorded. It is now my pleasure to turn the call over to Andy Naibo, Chief Communications Officer. You may begin your conference.

Andy Naibo, Chief Communications Officer, MIAX: Good afternoon, and thank you all for joining us today for MIAX’s third quarter earnings conference call. This is our first earnings call as a public company. With us today are your hosts, Thomas Gallagher, Chairman and Chief Executive Officer, and Lance Emmons, Chief Financial Officer. We also have Douglas Schaeffer, Chief Information Officer, and Shelly Brown, Chief Strategy Officer on the call, who will participate in the Q&A session today. Everyone should have access to our earnings announcement, which was released prior to this call. We have also published a slide presentation to accompany the press release. In addition, this call is being webcast, and an archived version will be available shortly after the call ends. All of these materials can be found on the investor relations section of our website at ir.miaxglobal.com.

We want to remind everyone that part of our discussion today includes forward-looking statements, which are based on the expectations, estimates, and projections regarding the company’s future performance, anticipated events or trends, and other matters that are not historical facts. The forward-looking statements in our discussion are subject to various assumptions, risks, uncertainties, and other factors that are difficult to predict and which could cause actual results to differ materially from those expressed or implied in the forward-looking statements. These statements are not guarantees of future performance, and therefore, undue reliance should not be placed upon them. We refer all of you to our press releases and filings with the SEC for a more detailed discussion of the risks and uncertainties that could impact the future operating results, financial condition, and MIAX’s.

We undertake no obligation to update any forward-looking statements made in this announcement to reflect events or circumstances after today or to reflect new information or the occurrence of unanticipated events except as required by law. During the call today, we will be referring to non-GAAP measures as defined and reconciled in our earnings materials. With that, I’d now like to turn the call over to Tom. Please go ahead, Tom.

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Thanks, Andy. Welcome to our third quarter 2025 earnings call. We’re excited to have you join us for our first call as a public company and appreciate your interest in MIAX. Today, I will provide high-level third quarter results and a brief overview of MIAX, followed by Lance walking through our third quarter 2025 financial highlights, and then we’ll open it up to your questions. For the third quarter, MIAX delivered strong results, growing net revenues 57% year over year to a record $109.5 million. These results were primarily driven by elevated industry options volumes and increased MIAX market share. Our market share in multi-listed options grew to a record 17.2% in the third quarter, up 24% from the prior year period. Furthermore, our successful IPO in August of this year represented a significant milestone that increased our access to capital markets and further enhanced our brand awareness.

The proceeds from the offering allowed us to retire $140 million of debt and build a strong cash position. I’ll now take a few minutes to walk through our value proposition and the factors supporting our long-term growth. MIAX is a technology-driven leader in building and operating regulated financial markets across multiple asset classes. Since our inception, we have built and launched four options exchanges and one equities exchange. We’ve also grown strategically through acquisitions. Since 2020, we’ve acquired two futures exchanges and clearinghouses, two international exchanges, and a futures commission merchant. This broad portfolio of licenses supports our growth initiatives and allows us to offer new products designed to meet the needs of a multitude of investor segments, both domestically and internationally. Our vision remains to cater to the needs of our customers and trading community.

Serve as the exchange of choice by delivering best-in-class technology, customer support, risk protections, and reliability. A critical differentiator for MIAX is our commitment and focus on technology, which is the lifeblood of an exchange. Importantly, MIAX differentiates its technology by providing low latency, high throughput, and industry-leading determinism, which serves as the foundation of our technology-first, customer-centric approach to building innovative marketplaces. When we built our technology infrastructure, I like to say we built the church for Easter Sunday. Even when volume and quote traffic spikes in periods of extreme volatility, such as the 2020 COVID outbreak or what was experienced in April of this year, we were ready, and our technology performed without issue. In fact, these high volatility events reinforce our reputation for providing best-in-class technology.

We understand the importance of continuing to invest in order to provide our members with high-performance technology to support their activity in today’s rapidly evolving derivatives markets. Broadly, the options market is experiencing significant growth. Multi-listed options volumes are surging to record levels, with industry third quarter 2025 average daily volume of 56 million contracts, up 26% year over year. September industry ADV reached 61 million contracts, while October ADV reached 67 million contracts. This growth has been driven by periods of elevated volatility in certain market sectors, as well as continued strong demand from a range of market participants, especially for shorter expiration options products. While many industries and businesses are volatility averse, for MIAX, volatility creates an increased need for risk management tools. As we look ahead, we continue to expect elevated volatility due to geopolitical tensions, uncertain trade policy, and an evolving interest rate policy.

Additionally, structural tailwinds, including increased retail participation, which has begun extending into the futures markets, and growing international investor demand, are creating secular growth opportunities as we launch new futures products. Just as retail trading growth has fueled record options volume, expanding retail participation in futures represents another significant opportunity alongside our comprehensive product expansion pipeline. Our focus remains on offering technology designed to support the needs of our market makers. By providing high throughput, low latency, and highly deterministic technology with industry-leading risk protections, we allow our market makers to have greater confidence in their ability to properly manage their quotes and risk during volatile markets, offering those market makers the ability to quote more aggressively. For the retail investor, this means tighter and deeper markets, not just during normal trading, but also during times of volatility when liquidity is most in demand.

In options, we see additional growth potential from a number of areas, including short-dated expirations for the most actively traded stocks, options listings on new IPOs, and the use of options in structured product listings, all of which support higher industry volumes. Furthermore, we launched our new MIAX Sapphire trading floor in Miami in September. This state-of-the-art facility, which we built to address customer demand, allows us to capture the additional volume opportunity in multi-listed options while bringing greater efficiencies to floor brokers and market makers. Miami has emerged as a major global financial center and is quickly becoming Wall Street South, and we’re proud to have expanded our presence in our namesake city. We remain excited about the substantial growth opportunities in options as an asset class, driven by continued elevated global volatility issues that support the ongoing use of options for dynamic risk management.

Moving to our growth initiatives, we continue to cultivate collaborative and strategic relationships across the industry that we are leveraging to introduce new and innovative proprietary products. In our futures business, the launch of the new MIAX Futures Onyx trading platform at the end of June brings the MIAX technology advantage to this new asset class and offers MIAX the ability to list a range of new futures products. We plan to list futures on the Bloomberg 500 Index in collaboration with Bloomberg, starting in Q1 2026, with futures on the Bloomberg 100 Index to follow. Importantly, the new financial products will trade in a data center located in close proximity to U.S. equity markets, allowing our market participants to reduce potential latency in their trading strategies.

Additionally, the Bloomberg 500 Index and Bloomberg 100 Index futures products will clear at the Options Clearing Corporation, which is the central clearinghouse for all U.S. listed options. This provides our members with improved margin efficiencies in their equity derivative trading strategies. We believe these Bloomberg Index futures will provide the foundation for a broad portfolio of equity index derivatives we plan to offer on MIAX Futures. Now, moving to our equities business, our current focus is to maximize revenue by continuing to improve our capture rate and profitability. We continue to believe our presence in U.S. equity markets positions us to leverage a range of opportunities, including market data and adjacent assets. With the acquisition of the International Stock Exchange, or TISE, in Guernsey, we have expanded our ability to offer listing services to global debt issuers beyond what we currently provide through the Bermuda Stock Exchange.

The TISE acquisition provides us with access to the European and U.K. markets and a valuable license in a respected regulatory jurisdiction. This helps accelerate our growth strategy by utilizing both BSX’s and TISE’s numerous international recognition and expertise in their respective products and markets. Now, I’ll turn over the call to Lance to provide details on our third quarter financial performance.

Lance Emmons, Chief Financial Officer, MIAX: Thanks, Tom, and good afternoon. As Tom mentioned, we had a strong quarter across our business. I will briefly discuss MIAX’s revenue model before I jump into the financial details. We generate revenue from transaction and non-transaction fees. Our key performance drivers for transaction fees include industry trading volumes, market share, and revenue per contract or share, which measures the average revenue we earn per contract or shares traded. Beginning this month, we will publish RPC and capture rates on a three-month rolling average basis on our website in conjunction with our monthly volume press release. In terms of non-transaction fees, we generate revenue from access fees, which we charge the customers to connect to our exchanges, from market data, which we earn through direct subscriptions and through our participation in the U.S. state plans, and from listings fees in our international segment.

For the third quarter, on a consolidated basis, total net revenue grew 57% year over year to $109 million. This was driven primarily by strong performance in our options business. The third quarter also includes a full quarter contribution from the June 2025 acquisition of TISE, which contributed $4.7 million in revenue. Our adjusted EBITDA increased 157% year over year to $48 million for the quarter, with an adjusted EBITDA margin of 44%. A significant improvement from the 27% margin in the prior year period. This performance demonstrates our ability to scale efficiently while also continuing to invest in our growth initiatives. Adjusted earnings significantly increased to $40 million compared to $8 million in the prior year period. Our adjusted operating expenses in the third quarter were $61.6 million compared to $51.1 million in the prior year period.

The increase was primarily due to higher compensation benefits driven by planned increases in headcount to support our growth initiatives, as well as the acquisition of TISE. Also contributing to the increase were investments in IT and communications costs due to the build-out of the MIAX Sapphire Exchange and the new technology platforms we rolled out for MIAX’s futures and BSX. Moving to performance by segment. Our options segment delivered strong results with net revenue of $94.5 million, up 55% year over year. Market share was 17.2%, up from 13.9% in the prior year period. This, along with elevated options industry volume, led to MIAX’s average daily volume of 9.6 million contracts for the third quarter, representing a 56% increase year over year.

Although we are still early in the fourth quarter, the momentum carried into October, with our options ADV reaching 13.1 million contracts and our market share reaching 19.4%. Our equity segment net revenue reached $4.4 million, up from $2.2 million in the prior year period, primarily due to improved capture rate as we continue to focus on maximizing total net revenues in this segment. Our futures segment net revenue was $4.8 million compared to $5.3 million in the prior year period. Hard red spring wheat revenues decreased during the third quarter as trading volumes were negatively impacted by participant migrations to our new MIAX Futures Onyx platform, as well as lower commodity market volatility. Our international segment net revenue was $5.5 million compared to $0.8 million in the prior year period, which was due to the acquisition of TISE in June of this year.

The IPO enhanced our balance sheet, with the quarter-end cash balance reaching $401 million and outstanding debt reduced to $6.5 million following the payoff of our senior secured term loan. Additionally, our outstanding put liabilities were terminated upon the IPO, further improving our balance sheet. In summary, we delivered strong financial results while investing in our technology platforms and expanding our product offerings. We believe that MIAX is well positioned to capitalize on the growing demand for innovative exchange solutions. With that, I will turn it back over to Tom.

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Thanks, Lance. We believe MIAX’s differentiated technology, exceptional customer experience, track record of building innovative marketplaces, and disciplined growth strategy positions us to deliver long-term shareholder value. To sum up, we now have in place a solid foundation to enable continued growth as the global technology-driven multi-asset class market leader that is anchored by four key pillars that I’d like to highlight next. First, we have now completed all of our purpose-built scalable technology platforms, which are differentiated by throughput, latency, determinism, and reliability. Second, we have a broad range of regulatory licenses allowing us to operate across multiple asset classes and in multiple jurisdictions around the world. Third, we have secured a broad range of products that are diverse and expanding, with multiple opportunities to launch new products across our exchanges.

Fourth, and most importantly, we have long-standing relationships with customers that we intend to leverage as we move into new asset classes together. These four pillars—our technology, regulatory licenses, broad product range, and relationships with our customers—are real competitive advantages that we believe will continue to drive our performance. I’ll now turn over the call back to Andy.

Gary, Conference Operator: Thank you, Tom. We will now open the call up for questions. Operator, first question, please.

We will now begin the question and answer session. To ask a question, you may press star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star, then two. Please limit yourselves to one question. If you have additional questions, you may re-enter the queue. At this time, we will pause momentarily to assemble our roster. Our first question today comes from Michael Cypress with Morgan Stanley. Please go ahead.

Hey, thank you. Good morning. Thanks for taking the question and welcome to being a public company. Congratulations on your first quarter out of the gate here. I was just hoping to ask more of a bigger picture question. You mentioned just a moment ago around a lot of different licenses, aspirations for new products, asset classes, geographies. I was hoping you could unpack that a little bit more, elaborate on your ambitions there. I think there may be some aspirations for crypto, event contracts. Maybe you could help flesh out how you’re thinking about new product opportunities, asset classes, geographies. You mentioned licenses. What are your ambitions and aspirations as you look out over the next three to five years? How might MIAX look compared to the MIAX of today?

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Thanks, Michael, for that question. I think given where we are today, Michael, our primary focus is on the products we’ve already announced. We’ve got so many good things on our plate now in our primary businesses. That’s going to remain my near-term focus in terms of opportunities. Having said that, if and when an opportunity presents itself that is compelling, based on what we’ve built over the last three or four years, we have the technology infrastructure, we have the licenses, and the various tools, so we could jump in. In areas such as economic or political or sports-related events-based contracts. The near-term focus for us with the licenses that we have in both options and futures is to exploit the opportunities that we’ve secured, including the opportunities as a result of the recent licensing of the B500 and the B100 from Bloomberg.

Gary, Conference Operator: The next question is from Ken Worthington with JP Morgan. Please go ahead.

Hi, good evening. Will echo my congratulations on the multi-listed market share. You rose to a new record during the quarter. We look at October, and as you mentioned, it had another step up again this past month. Can you talk about the launch of the Sapphire trading floor and help us better understand the dynamics that have driven the acceleration in market share gains that we’ve been seeing over the last quarter plus?

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Hey, thanks, Ken, and I appreciate the kind words. I’m going to turn this one over to Shelly Brown. Shelly?

Shelly Brown, Chief Strategy Officer, MIAX: Thank you, Ken, and thank you, Tom. Options continue to be our most mature market segment, but we believe there’s still room for additional growth. There are strong secular tailwinds in the industry, growing industry ADV, new optionable classes resulting from a robust IPO market, and innovative products like short-dated equity options. That being said, we are very excited about the new Sapphire trading floor volume, but it is a fractional portion of our recent market share growth. The Sapphire trading floor captured about 6.5% of the industry trading floor volume in October, our first full month of trading, or about 0.35% of total multi-list volume. We are one of six trading floors, so we understand and believe there’s lots of room to grow in that segment.

We are not managing our current market conditions for the short term, but for the long term, we believe that there’s going to be additional flow and there’s plenty of room to grow. We’re very happy with the trend for our market share.

Gary, Conference Operator: The next question is from Kyle Voigt with KBW. Please go ahead.

Hey, good evening, everyone. Maybe just a question on single stock options. There have been some exchange filings in the past couple of quarters to offer additional expiries weekly for larger cap single stocks, I think paving the way towards an eventual single stock zero DTE type of launch. Can you just remind us what you see as the pathway to being able to offer single stock options with everyday expirations? From a timing perspective, can you just kind of lay out a pathway in terms of how far away you think that ultimately will be?

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Yes. Thank you very much for that question, Kyle. It’s certainly an area that we’re well positioned for. I’m going to turn it over to Shelly Brown. Maybe, Shelly, you could talk about the response here.

Shelly Brown, Chief Strategy Officer, MIAX: Yes. Thank you for the question. With regards to zero DTE options, the timing for that depends on regulatory approvals. There’s already an initiative with the commission to list short-dated options initially just for Mondays, ending Mondays and Wednesdays to the existing Fridays. Once these multi-list products are approved, we will certainly list them on all four of our options exchanges, being that they are multi-list options. Our exchange technology already supports rapid product innovation and launches such as this, and we’re ready to support an expansion of the multi-listed options, zero DTEs, and single stock options. Our system speed, throughput, and risk protections allow liquidity providers to offer tighter and deeper markets for these products, so we think we’ll be able to gather an outsized market share.

We do believe that the zero DTE options and single stocks represent a significant growth opportunity across the industry, especially in the retail trading segment. Timing really depends on regulatory approval and market demand.

Gary, Conference Operator: The next question is from Jeff Schmidt with William Blair. Please go ahead.

Hi, good afternoon. A question about your October market share. It jumped quite a bit to 19.4%. Growth was obviously really strong. Just curious if you can maybe talk about what drove that sharp increase, and did you see a rise in complex trades at all during the month? Thanks.

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Jeff, thanks for that question. At the risk of overworking Shelly here, Shelly, you want to just talk about the October market share gains? Thank you very much.

Shelly Brown, Chief Strategy Officer, MIAX: The October gains were across the board. As you know, we have four options exchanges. We saw growth in all segments across those exchanges. There has been continued growth in complex orders. That’s a focus for us due to capture, and we continue to be the second largest exchange in complex orders and continue to grow that segment. We’ve seen growth across all the different segments, including the price improvement options. I believe it comes back to the use of our technology.

Gary, Conference Operator: Again, if you have a question, please press star, then one. The next question is from Chris Brendler with Rosenblatt. Please go ahead.

Hi, thanks. Thanks for my question, and congrats on the results as well. Just wanted to drill down a second on seeing such strong market share gains and revenue per contract has been trending in an upward direction. Ticked down a little bit this quarter, which I imagine is mixed. Is there any opportunity for you to lean into your success? I think the market tailwinds are behind you, and maybe extract a little more out of your revenue per contract in the options business, or is it just naturally falling out of other successes you’re having in the area? Just wanted to see if you gave me a little more detail there. Thanks.

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: I really appreciate the question, Chris. I’m going to ask Lance to talk about the revenue per contract to the extent that he can. I will say that as our market participants need to provide greater and greater liquidity to their retail customers, the investments we’ve made over the last three or four years in technology, in terms of the latency, the throughput, and the determinism, we really feel that we’ve differentiated ourselves and we’re a partner that can help firms provide this liquidity to their retail customers. Because we can provide this assistance through the technology infrastructure, we’re getting more and more volumes. Now, in terms of your second part of your question, Lance?

Shelly Brown, Chief Strategy Officer, MIAX: Yeah. Yeah. Hey, Chris. Yeah, you nailed it. There are some mixed shifts between the second quarter and the third quarter. We have not done any major fee changes other than we did do a change to the regulatory fee, a temporary reduction from September to December, which had a slight impact for the quarter. I will also note that we continue to focus on, again, maximizing revenue. If there is business out there that is positive to us, even if it is at a lower capture rate, as long as it is positive, we will focus on it. Just to highlight again that beginning with today’s monthly volume release, we are putting out the capture rates on a trailing basis to provide some additional transparency there.

Gary, Conference Operator: The next question is from Patrick O’Shaughnessy with Raymond James. Please go ahead.

Hey, good evening. As we are seeing more participation in the options space by retail investors, do you have a sense for how your market share might differ between retail versus institutional customers?

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Patrick, thank you very much for the question. Shelly, do you want to address that in terms of the retail versus institutional mix?

Shelly Brown, Chief Strategy Officer, MIAX: Certainly. Thank you and appreciate the question, Patrick. The retail versus institutional mix, obviously, we can’t drive the demand from the end user. We’re here to respond to that demand. Our focus has always been on giving the market makers the ability to provide liquidity, provide deeper markets, tighter markets, and the tighter markets are what draw those orders from both the institutional market and the retail market to our exchange. It is all about the customer experience. We continue to roll out new technology and improve our customer service to continue that. Offering the premium product to those customers.

Gary, Conference Operator: Our final question today is a follow-up from Michael Cypress with Morgan Stanley. Please go ahead.

Oh, thanks for taking the follow-up here. Just wanted to ask about the expense outlook. I was hoping maybe you could unpack how you anticipate the pace of expense growth to trend from here, how that might evolve or flex with volumes and revenues. If you could maybe just elaborate on the stock-based comp in the quarter. I think it looked like maybe $29 million was more recurring. Maybe you can elaborate on that, how much we can expect on a go-forward basis and any other broadly notables to speak of in the quarter. Thanks.

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Yeah. Thank you, Michael. Lance?

Shelly Brown, Chief Strategy Officer, MIAX: Yeah. I can cover that, Michael. In terms of total expense, I think as you look at the third quarter, we did first quarter as a public company, so a little uplift in terms of D&O and board fees and things like that. Maybe a little bit more in the fourth quarter as you kind of get a full quarter effect into that. I think that what you’ve seen also in the quarter is a pretty high incremental margin as we’ve sort of really completed the build-out. As sort of mentioned, right, we finished a build-out of Sapphire, both the electronic and the floor. We finished a rollout of the Onyx Futures trading platform earlier, sort of middle of this year. We would expect to see sort of less expense growth going forward. Look, we’re still growing the top line pretty heavily.

I think that should be in consideration as well. In terms of share-based comp, yeah, certainly a lot of noise in the quarter, a lot of uneven expenses. There was a lot of RSAs that vested at the time of the IPO and some additionals that kind of accelerate or vest over the next 180 days following. Up until the expiration of the lockup. On slide 23 of our deck, we provided sort of a breakout of the share-based comp. That includes sort of the restricted stock awards, the options, and a little bit of warrant expense. I would probably consider the option expense to be sort of more recurring.

Now, that may change form, but in terms of the dollar amount, I would consider that more a recurring type expense, only because, as I mentioned, the RSAs as a private company were a little lumpy, and a lot of them vested either at the time of the IPO or over the period of the lockup. Hopefully that gives you some good color there.

Gary, Conference Operator: The next question is from Patrick Moley with Piper Sandler. Please go ahead.

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Yes. Good afternoon. Thanks for taking the question. I just had a broad one on options market growth. We’ve seen very strong strength over the last few years. Just wondering how you guys are thinking about the setup from here. I apologize if this was addressed earlier. We’re juggling a few calls. Just the outlook and then heading into next year, what are some of the major themes that you’re kind of focused on or expect to play out in options? Thanks.

Hey, Patrick, thank you very much for the question. I’ll start it, and then I’ll ask Shelly to add to it. When you look historically at what’s happened in our industry, back in 2012, we were doing 15 million contracts a day, and then we hit 54 million contracts a day last year, only to see ourselves in October at 67 million contracts a day. I feel that the industry tailwinds, particularly the growing retail base of market participants, bodes very well for continued growth in our options segment. When you couple that with some of the new filings from some of our competitors with respect to short-dated options, I see continued growth opportunities. Yes, this is our more mature business segment, but we still think there’s robust growth because of the.

Industry tailwinds, the infrastructure that we’ve invested in, and the very recent launch of the MIAX Sapphire trading floor. Maybe, Shelly, you could fill in a little more details. As we talk about the opportunities for our more mature business.

Shelly Brown, Chief Strategy Officer, MIAX: Thank you, Tom. Thank you for the question, Patrick. The growth in retail, I believe, will continue. The experience they have by the offerings from the retail firms, the ability to trade basically for free, will fuel further growth. With the market rising, I think there is more exuberance in the marketplace. There is more ability for people to get involved in the marketplace. The short-dated options bring options that are priced lower, and the retail can reach easier. We think that the retail experience will continue to expand going forward.

Gary, Conference Operator: This concludes our question and answer session. I would like to turn the conference back over to Tom Gallagher for any closing remarks.

Thomas Gallagher, Chairman and Chief Executive Officer, MIAX: Thank you very much. Obviously, we’re very excited to have just released our third quarter earnings, and we’re very grateful for the support that our member-based community of our members in options, equities, and now futures. We’re very excited about the opportunities going forward, and we really feel good about having a fortress-type balance sheet now as a result of the IPO. Thank you for your time today, and we’re looking forward to future calls as we move forward as a public company. Thank you and have a nice evening.

Gary, Conference Operator: The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.