Business Segments

12 Months Ended

Dec. 31, 2021

Segment Reporting [Abstract]

Business Segments

BUSINESS SEGMENTS

We manage, operate and provide our products and services in four business segments: Market Technology, Investment Intelligence, Corporate Platforms and Market Services. See Note 1, “Organization and Nature of Operations,” for further discussion of our reportable segments.

Our management allocates resources, assesses performance and manages these businesses as four separate segments. We evaluate the performance of our segments based on several factors, of which the primary financial measure is operating income. Results of individual businesses are presented based on our management accounting practices and structure. Our chief operating decision maker does not review total assets or statements of income below operating income by segments as key performance metrics; therefore, such information is not presented below.

The following table presents certain information regarding our business segments for the years ended December 31, 2021, 2020 and 2019:

	Year Ended December 31,
	2021		2020		2019
Market Technology	(in millions)
Total revenues	$	463	$	357	$	338
Depreciation and amortization	111		33		30
Operating income	46		32		54
Purchase of property and equipment	48		43		40
Investment Intelligence
Total revenues	1,076		898		768
Depreciation and amortization	62		57		52
Operating income	694		572		480
Purchase of property and equipment	44		52		30
Corporate Platforms
Total revenues	613		521		490
Depreciation and amortization	31		34		34
Operating income	247		187		177
Purchase of property and equipment	30		30		27
Market Services
Total revenues	3,707		3,818		2,616
Transaction-based expenses	(2,466)		(2,722)		(1,723)
Revenues less transaction-based expenses	1,241		1,096		893
Depreciation and amortization	73		76		72
Operating income	800		685		508
Purchase of property and equipment	41		63		30
Corporate Items
Total revenues	27		31		46
Depreciation and amortization	1		2		2
Operating income (loss)	(346)		(242)		(202)
Consolidated
Total revenues	$	5,886	$	5,625	$	4,258
Transaction-based expenses	(2,466)		(2,722)		(1,723)
Revenues less transaction-based expenses	$	3,420	$	2,903	$	2,535
Depreciation and amortization	$	278	$	202	$	190
Operating income	$	1,441	$	1,234	$	1,017
Purchase of property and equipment	$	163	$	188	$	127

Certain amounts are allocated to corporate items in our management reports as we believe they do not contribute to a meaningful evaluation of a particular segment's ongoing operating performance. These items, which are presented in the table below, include the following:

•Amortization expense of acquired intangible assets: We amortize intangible assets acquired in connection with various acquisitions. Intangible asset amortization expense can vary from period to period due to episodic acquisitions completed, rather than from our ongoing business operations. As such, if intangible asset amortization is included in performance measures, it is more difficult to assess the day-to-day operating performance of the segments, and the relative operating performance of the segments between periods. Management does not consider intangible asset amortization expense for the purpose of evaluating the performance of our segments or their managers or when making decisions to allocate resources. Therefore, we believe performance measures excluding intangible asset amortization expense provide management with a useful representation of our segments' ongoing activity in each period.

•Merger and strategic initiatives expense: We have pursued various strategic initiatives and completed acquisitions and divestitures in recent years that have resulted in expenses which would not have otherwise been incurred. These expenses generally include integration costs, as well as legal, due diligence and other third party transaction costs. The frequency and the amount of such expenses vary significantly based on the size, timing and complexity of the transaction. Management does not consider merger and strategic initiatives expense for the purpose of evaluating the performance of our segments or their managers or when making decisions to allocate resources. Therefore, we believe performance measures excluding merger and strategic initiatives expense provide management with a useful representation of our segments' ongoing activity in each period.

•Restructuring charges: We initiated the transition of certain technology platforms to advance our strategic opportunities as a technology and analytics provider and continue the re-alignment of certain business areas. See Note 20, “Restructuring Charges,” for further discussion of our 2019 restructuring plan. We believe performance measures excluding restructuring charges provide management with a useful representation of our segments' ongoing activity in each period.

•Revenues and expenses - divested/contributed businesses: We have included in corporate items the revenues and expenses of our U.S. Fixed Income business, which was previously included in our Market Services and Investment Intelligence results. See “2021 Divestiture,” of Note 4, “Acquisitions and Divestiture,” for further discussion of this divestiture. Also included are the revenues and expenses associated with the NPM business which we contributed to a standalone, independent company, of which we own the largest minority interest, together with a consortium of third party financial institutions in July 2021. Prior to July these revenues were previously included in our Corporate Platforms results. For 2019, we have included in corporate items the revenues and expenses of the BWise business which was part of the IR & ESG Services business within our Corporate Platforms segment as BWise was sold in March 2019.

•Other significant items: We have included certain other charges or gains in corporate items, to the extent we believe they should be excluded when evaluating the ongoing operating performance of each individual segment. Other significant items include:

◦for the year ended December 31, 2021 a charge related to an administrative fine imposed by the SFSA associated with the default that occurred in 2018, see “Nasdaq Commodities Clearing Default,” of Note 15, “Clearing Operations,” for further discussion, and for the year ended December 31, 2020 the reversal of a regulatory fine issued by the SFSA. Both charges have been included in regulatory expense in the Consolidated Statements of Income;

◦for the year ended December 31, 2020, a provision for notes receivable associated with the funding of technology development for the consolidated audit trail;

◦for the years ended December 31, 2021 and 2020, a charge on extinguishment of debt;

◦for the year ended December 31, 2020, charitable donations made to the Nasdaq Foundation, COVID-19 response and relief efforts, and social justice charities; and

◦for the years ended December 31, 2020, certain litigation costs which are recorded in professional and contract services expense in the Consolidated Statements of Income.

The above charges are recorded in general, administrative and other expense, unless otherwise noted, in our Consolidated Statements of Income.

The following table summarizes our Corporate Items:

	Year Ended December 31,
	2021		2020		2019
	(in millions)
Revenues - divested/contributed businesses	$	27	$	31	$	46
Expenses:
Amortization expense of acquired intangible assets	170		103		101
Merger and strategic initiatives expense	87		33		30
Restructuring charges	31		48		39
Regulatory matters	33		(6)		—
Provision for notes receivable	—		6		20
Extinguishment of debt	33		36		11
Charitable donations	—		17		—
Expenses - divested/contributed businesses	10		18		25
Other	9		18		22
Total expenses	373		273		248
Operating loss	$	(346)	$	(242)	$	(202)

For further discussion of our segments’ results, see “Segment Operating Results,” of “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Geographic Data

The following table presents total revenues and property and equipment, net by geographic area for 2021, 2020 and 2019. Revenues are classified based upon the location of the customer. Property and equipment information is based on the physical location of the assets.

	Total Revenues		Property and Equipment, Net
2021:	(in millions)
United States	$	4,822	$	325
All other countries	1,064		184
Total	$	5,886	$	509
2020:
United States	$	4,662	$	311
All other countries	963		164
Total	$	5,625	$	475
2019:
United States	$	3,405	$	250
All other countries	853		134
Total	$	4,258	$	384

Our property and equipment, net for all other countries primarily includes assets held in Sweden. No single customer accounted for 10.0% or more of our revenues in 2021, 2020 and 2019.