Intercontinental Exchange, Inc. (ICE) Q2 2020 Earnings Report, Transcript and Summary

Good morning, and welcome to the Intercontinental Exchange Second Quarter 2020 Earnings Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note, that this event is being recorded. I would now like to turn the conference over to Warren Gardiner, Vice President of Investor Relations. Please go ahead, sir.

Good morning. ICE's second quarter 2020 earnings release and presentation can be found in the investors section of the ice.com. These items will be archived and our call will be available for replay. Today's call may contain forward-looking statements. These statements which we undertake no obligation to update represent our current judgment and are subject to risks, assumptions and uncertainties. For a description of the risks that could cause our results to differ materially from those described in forward-looking statements, please refer to our 2019 Form 10-K, second quarter Form10-Q and other filings with the SEC.

Thanks, Warren. Good morning, everyone. And thank you for joining us today. I'll begin on Slide 4 with some of the key highlights from our strong second quarter results. Net revenues totaled $1.4 billion, up 8%, driven by 13% growth in Trading and Clearing revenues and record data services revenues of $574 million, up 4% versus last year. This solid revenue performance combined with expenses at the low end of our guidance range helped deliver second quarter adjusted earnings per share of $1.07, up 14% over the prior year. We returned $564 million to shareholders during the quarter, including $400 million through share repurchases, and a nearly 10% increase in our dividend per share. Through the first half, we have returned over $1.4 billion to shareholders through both buybacks and dividends, an increase of 31% versus last year. As I mentioned, second quarter adjusted operating expenses of $575 million were at the low end of our guidance. COVID related impacts of the late IPOs, which reduce marketing spend at the NYSE. In addition, the high productivity of our technology team and reduce vacation due to COVID related travel restrictions drove higher capitalized labor expense during the second quarter. With a strong IPO pipeline and the reopening of many communities this summer, we expect these factors to begin to reverse in the third quarter, yielding an incremental $5 million to $7 million in expense. We also anticipate a modest ramp in strategic investments during the quarter, all of which is expected to result in third quarter adjusted operating expense in the range of $580 million to $590 million.

Thank you, Scott, and good morning everyone on the call. Before I begin, I'd like to thank our customers who continue to turn to our global markets, data services and leading technology to navigate these unprecedented times. And I'd like to recognize my colleagues at ICE for their outstanding contribution to our first half results. Now turning to Slide 7. Our records first half performance, which was highlighted by revenue growth of 15%, adjusted operating income growth of 19% and adjusted earnings per share growth of 25% is a testament to our asset class diversity, balanced mix of recurring and transaction based revenues, and ultimately the growth potential of our platform. In our first full quarter of operating in a work from home environment, I'm very pleased to say that our team's responded. Driven by our multiyear investment in both information and technology, our data services business delivered a remarkably strong performance. We generated key wins with our pricing and reference data, where the quality of our end of day and real time fixed income prices attracted both new customers and increased consumption from existing customers.

Thank you. We will now begin the question-and-answer session. . And our first question will come from Rich Repetto with Piper Sandler. Please go ahead.

I guess, thank you for going through all the details on the open interest, the energy open interest. And I guess my question was, I'm just trying to differentiate, why yours and I know you went from natural gas being very strong, but why you're opening for, say, as separated from your peers. And if you think I'm right when I'm saying as of yet it hasn't played out in volumes. And is that sort of the view that you have, but it will later? Or could you sort of explain that? And maybe I just don't have the right picture?

Sure. What we've been doing over the last decade or so is really expanding the footprint of our energy futures markets. And obviously, we started when we acquired the international petroleum exchange of London that had four energy contracts, and today we have over 900, approaching 1,000. And so the growth that you're seeing is in the global markets, and it's in customers trading in these smaller niche contracts that give them more precision for hedging something locally or some product oriented to energy that is specific to their geography and business. And that’s why I mentioned in my prepared remarks which is a third of our revenues now and energy come from these other energy products and they're the ones that are growing the fastest. They are correlated to the benchmarks, which is why it's important that we continue to market and push the main benchmarks, but the growth is in these other areas. And when energy markets are in contango, which for non-traders means the normal market conditions, where there is storage available in the world. We have always seen that open interest in these energy products is a good precursor to future volume trends. And actually, when the markets reverse and do what they call backwardate. This open interest becomes a four metrics. So one has to use open interest cautiously, but we see the opportunity for this business to continue to grow as customers come back to these open positions and manage them through the duration of their life. So it's a very bullish sentiment that we're using inside the company for our own forecasting.

And the only thing I'd add to that is don't get locked in the overall totals with some of the dynamics going on underneath, because a lot of what Jeff just talked about is growing right now. So our other oil products are up 15%, year-over-year in July. Our natural gas products are up 5% year-over-year in July. Our emissions products are up 21% year-over-year in July. And you know, looking at our website, those are higher RPC contracts. So not only do we have the mitigation and commercials on the platform, not only do we have the mitigation of the diversity across the products, but the growth right now as mitigation to some extent against the revenue impact that we'll see. And as you know, you can't spend volume, you can spend revenue. And that's where the cash capital returns and things like that are afforded. So it just, I'd encourage you the things that Jeff went through in his prepared remarks, take a look at how those businesses performing because they're growing right through this.

Got it, and good great insight, especially on the you can’t -- the volume translate into revenue. But anyway, my follow-up question, Jeff, was going to be on the ETF Hub. But I think your excitement in -- as you communicated, and talked about more of the -- just sort of the fact the sidetracked and diverted me let say. So I guess the question on mortgage services is that to the peers, right for digitization, automation, but there is a slight difference. I think from some of the markets, or maybe it isn't, maybe you can sort of draw the connection. With the other markets that you automated, there was certainly a matching engine, the exchange in trade and a massive platform here. It is maybe goes to the database management side of it. But it seems like you've just got some great tools that leverage this, potential for automation in this big market. But could you, I guess, draw -- give us a little bit more insight on the connection there? And maybe what the differences between that and say, the trading platforms that you've automated again and again?

Sure. It's a good question coming from you Rich because I know you and I have talked in a number of public forums about the fact that you've seen ICE really focused on the settlement process in the markets that we serve. In 2007, we moved into clearing our own futures products. And I think that was pivotal moment in the history of the company and a light went on for me in the management team and the board that we really can do something for this back office workflow that is incredibly sticky. So you've now seen with the ETF Hub and the way we're approaching the fixed income markets, we entered through the back office with the reference data initially, and now moving into the ETF Hub, which is a settlement, essentially, infrastructure. And we're using the same playbook in mortgage which is let’s get into the settlement workflow, and as I mentioned in my prepared remarks with MERS, right now, we touched almost all of the mortgages in the United States through what we've already built. And once you have that settlement scheme, it's easy to expand upstream and into the data business and into adjunct markets where that create value for customers that are very, very plugged into your network. And so think of what we're doing as, building the clearinghouse if you will for the mortgage industry.

And the next question will come from Ken Worthington of JPMorgan. Please go ahead.

Hi, good morning. Thank you for taking my questions. ASV growth improves sequentially this quarter to 4.5%. It is still at the low end of the range you set forth when you guys announced the IDC deal. Are we on the path forward to the midpoint of your range or maybe even at the higher end of the range? The backdrop on the transition to fixed income indexation seems to be coming together quite well. You would have indicated, more new account wins. So it seems like things are getting better you indicated towards the -- improving as you move through the year. So, is the outlook here, or what is the outlook here over the next couple of years for ASV growth? Should we expect it to continue to improve from these levels?

Hey, Ken, its Scott. Thanks for the questions. Yes, look, I do think we certainly expect that our ASV growth will continue to accelerate as we move through the rest of this year. And by the way, I think in addition to the total ASV accelerating from the first quarter importantly pricing analytics, which is half the business move from three in the first quarter to four in the second quarter. And again, I expect that trend to continue as we move into the back half of the year. I said back in February, I thought price and analytics will grow 5% to 6%. I still think that's true for the year, which indicates I also think the revenue growth for price and analytics will accelerate in the back half versus the first half. And I think there are a number of trends that are really driving. And by the way, I've been given a shout out to Lynn and the team because they're leveraging those trends from home without travelling, without being able to go and meet customers face to face. And yet, we just had the best quarter of signings we've ever had. When it's told me she feels better about the pipeline entering the third quarter then she did entering the second quarter. And it goes to a lot of what Jeff was talking about. It's a flight back to quality on prices. We see customers consuming more of our prices. We see customers adding the names, adding our reference data because what we saw to the crisis is our prices were the De Facto price discovery. And in a world where you don't want tracking there, you've come to I say the services to buy those prices. That's what we're seeing. Our existing customers are buying more. We're seeing new customers join. Jeff talks about the index business, we now have $253 billion indexed against our indices, our fixed income indices. We went from single digits to nearly 20% share in that space in a very short period of time. And as Jeff said, that's still not $100 million business for us and it will be once. You look at the feeds business where that business didn't exist when we bought IDC five years later, it's approaching a $100 million in revenue and there we can compete not just on quality, but on price, because we're not protecting anything. We're going after new business, and we're seeing competitive wins, competitive wins against stable competitors and competitive wins against competitors that -- where customers aren't quite sure who owns them and who's controlling them at this point. So I think you're seeing all of those trends, a lot of that builds up in the quarter and allowed us to do a little better than the high end of our guide. It allowed me to mention in my prepared remarks that we're going to accelerate sequentially in the third quarter, and then again in the fourth quarter. And again, in a world where our sales team sitting at home, they're doing a fantastic job, and have allowed us to hold our guidance and to see acceleration in growth. So you're going to see it in revenue, you're going to see in ASV. And by the way, I feel very good about how it sets us up for 2021 as well.

Great, thank you. And then we have some distance between the challenging April WTI delivery in negative prices for TI that resulted. Has there been any noticeable fallout and at this point, do you think ICE might see a benefit in Brent trading from where participants switching to Brent? Or has that transition already happens, over the last decade?

Hi Ken, it’s Ben Jackson. I'll take this one. So the short answer that question is yes. There is opportunity for Brent here and we're seeing it in a number of different areas. Jeff touched on one in some of his prepared remarks and in the first answer to Rich's question where I think that market participants have seen now firsthand a lot of the issues that can be created by that landlocked infrastructure on WTI versus the truly global demand pool that Brent has and can service. And what that's led to is not only growth in our Brent contract itself, but also in all of the refined products that come up with a barrel of oil, all the different locations where you can make and take delivery, which is very unique on our platform, where we have those hundreds and hundreds of different locations and refined products that customers can trade that are very deep and very liquid and are high growth opportunities for us. The other areas that we're seeing new opportunities for growth at Brent are for example, an ETF space. So we are having an unprecedented number of conversations now with ETF providers about having Brent for the first time. Another area we're exploring is retail demand. So retail in particular, in Asia, we're assessing what that opportunity is, but given some of the dislocations that happened in WTI, there are markets across Asia, that we're looking to expand and offer a retail offering for Brent. And then the third of the discussions around the Gulf Coast. So as I mentioned in Q&A in our last quarter, when oil hits the water coming out of the gulf, it price reference is most often Brent, so commercial customers are now engaging us more than ever around opportunities in the Gulf Coast around Houston related benchmarks and Gulf Coast related benchmarks. Bbecause Brent they see as the most logical benchmark to differentiate those contracts off of and create a differential market again. So we're engaged more than ever with commercial customers around what is that right, U.S. benchmark going forward and what changes may need to be made to them? So the short answer is yes, there's a lot of opportunity ahead of us and Brent.

Our next question will come from Alex Kramm with UBS. Please go ahead.

Hey, good morning, everyone. Just wanted to follow-up on the mortgage discussion. Thanks for the detail here. I saw an industry poll in the mortgage industry the other day, that basically echo what you're saying in terms of digitization and the spending is going there that said, I think only 20% of that spend is going towards the closing portion, I think the majority is go to servicing and processing. And I think underwriting is a smaller part. So, first of all do you agree with that? It was an informal pull. But then if those other areas are getting more spending, how quickly can you expand from your base here? It doesn't have to be potentially inorganic, because, in terms of time to market?

Thanks, Alex. It's Ben. I'll jump in on this one. So I think Jeff went through in his prepared remarks that focus on the closing and post-closing process? And a lot you answered some of the question in the way that you framed your question. In that, the post-closing and closing process is the one that's the most ripe for innovation right now. It's been the most manual laden part of the entire process. And with the two assets that we have been very unique with MERS that we've talked about a lot and that with Simplifile as Jeff mentioned in his prepared remarks having a very unique network and paved the road to all these different settlement agents and jurisdictions that no one else has, then that unique reference data set that we have. Puts us in a position for new growth opportunities that have a significant TAM, a billion dollar TAM across them. And to unpack how we're executing, how to think about that growth opportunity in front of us, and how easy it is and how now right in front of us it is, I'll give you a couple of examples. So first is with Simplifile, a key business be in e-record business. We've mentioned on calls that right now we're in jurisdictions and plugged into jurisdictions that represent 85% of the U.S. population. But in those jurisdictions, if you go back to 2019, we were only capturing on our e-record business about 25% of the eligible documents that we would take a pull on and we would get a fee on. You go to the first, accelerate to the first six months of this year and that has accelerated to 35%. So we've gone from 25% to 35% capture of what was manual and paper based documentation to now automated. A second example that we've talked about is e-notes. And Jeff mentioned this in his prepared remarks that we're doing about 3% of the MERS volume is now so when somebody's registering a mortgage, about 3% of those loans also include the registration of an e-note. If you go back to last year, that was 1%. So we're seeing a nice pickup in acceleration there. And in addition to that, we're adding customers and have added customers like Ginnie Mae, Chase, Rocket, U.S. Bank onto this platform which gives us good visibility into a tailwind that will continue to grow that percentage. A third area of growth that we haven't talked about, is a business that Simplifile really builds organically by itself as a startup business. And that's the automation of the closing and post-closing process. Think of this as very complimentary to what I just discussed that MERS has on e-notes and this is the automation of all the other elements of the closing and post-closed process. That business has gone from a start up to now if you use MERS volumes as a proxy during the first six months of this year, it's captured about 3% of that market. And we see similar to the e-note trend we're seeing adoption pick up significant customers onboarding onto that, and we have a very big TAM ahead of us there. The last thing I'd highlight is that while we have a bunch of other opportunities for growth in this market, the other thing that to look at is there's a very strong refi trend in the market, where each one of the services that we provide in every refinance that's done, we're collecting a transaction fee associated to each of those transactions. And if you look at where mortgage rates are -- if you look at where mortgage rates are now, there's an estimation from industry estimates that about 18.5 million outstanding mortgages are in the money at current rates. And in the money means they're 75 basis points lower than where rates are currently set. So we see ahead of us a significant refinancing boom, it's going to last for quite some time and with the Central Bank action that has happened, it's likely to continue in the years ahead.

Our next question will come from Brian Bedell with Deutsche Bank. Please go ahead.

That's a good takeaway then in to my question on fixed income and credit broadly. Obviously the mortgage side of that has fantastic tailwinds. Can you talk about the revenue efforts within fixed income trading? And tell me, if this is accurate. Sounds like you've got faster near-term growth trends on the mortgage side. And we have a little bit of a longer term build on the fixed income trading side. And then if you can flesh how you see the revenue in that area, growing in the second half and then into next year. I think ETF Hub obviously has got great momentum, but I believe, correct me if I'm wrong, but if we do not charging much for that right now. And there's a more of a promotional game plan on that. So maybe if you could just flesh that part out of that?

So I think the way you characterize it is correct in terms of revenue. So with mortgage we obviously have had and have in front of us, near medium and long-term, a significant TAM to go after we're very well positioned to capture it and we're capturing it actively now. In fixed income, as I said, on the last few quarterly calls, what our play here has been on execution is to really establish a network for the first time, institutional network, leveraging the strengths that we have in our ICE data services business that has that institutional network, plugging into very inefficient workflows that are in the fixed income marketplace, and then combining our execution venues, our capabilities on the ICE data services side and plug it into these workflow inefficiencies to solve real world problems. And the first example of that, as we've talked about on calls is ETF Hub, and I gave a lot of great updates last quarter. A couple of things to look at in terms of network expansion and also volume expansion on that we've achieved this past quarter, because we've added our first three market makers onto the platform. So significant market makers like Jane Street, Old Mission, and Chicago Trading are now on the platform. Jeff mentioned in his remarks, we had two more AP significant ones in Credit Suisse and Wells Fargo that have joined the other five that are on the platform. We've added a new issuer as a development partner on the advisory committee in JP Morgan asset management. We continue to enhance our workflow automation capabilities in the custom basket facilitation or the ability to customize what are the securities that I can provide to somebody to swap for an ETF in that primary trading vehicle. And last but not least, volumes growth. So quarter-over-quarter our volume continues to grow in our primary trading venue. And we've done now over 330 billion in transactions since inception. What's ahead of us and getting to your question around execution, one of the key things ahead of us as I've mentioned on our last call that we just launched ICE Select and ICE Select is our aggregation venue of all of our protocols, all of our venues, as well as our rich ICE data services, data sets and analytics, like best execution and real time pricing. We've integrated all that into an aggregation venue, that in the coming weeks, it's going to be integrated into the ETF Hub. So for the first time, our venues will compete in the secondary market for flow to fulfill orders and procurement of bonds versus voice and other venues. And with the 330 billion that we've executed to date in the primary market, as a meaningful portion of the market that's out there for us to get started. Also ahead of us is really introducing for the first time our chat and instant messaging platform that's very well established in the energy and commodities markets, and introducing that for the first time into the fixed income markets. In late this year, we'll have international ETFs added on top of that. We will be in the latter part of the second half of this year, we will also start to share and publish on a regular basis volumes as our institutional network is starting to be established.

And Brian, the only thing I want to add onto that because it gets overlooked a little bit its -- we've got a CDS business that did $100 million in revenue in the first half of the year, which is 20% higher than it was a year ago on track to be a $200 million business. So that's another fact similar to my answer to Rich, that I hope people don't miss because in a world where people are looking to hedge their credit exposures, they can do it, with the bonds themselves, but they're also turning more and more to CDS. And we built to Jeff's point earlier about building clearing solutions and back end solutions that facilitate risk management. We did that and that CDS clearing business and its performance through the first six months has been outstanding.

Our next question will come from Alex Blostein with Goldman Sachs. Please go ahead.

Hi, this is Sheriq filling in for Alex. You issued some long term debt in this quarter. Can you talk about the rationale for building up the little extra dry powder? And is there an opportunity to accelerate the share repurchase on the back of higher cash balances now?

Yea, so look, we did -- we have some bonds that were coming due later this year. And we also had through some of the M&A activity that we've done a rather accelerate are higher balance in CP. Looking at the debt markets and look at the interest rates that were available, we thought it was a good time to move into the market and to turn some of the CP out and to go ahead and take out the bonds. And if you look, we actually those bonds that were due in December of ’20. We're actually going to cost us more from a coupon standpoint than the blended money we got that averages out at 20 years maturity. So our blended costs on what we raised is a weighted average maturity of 20 years, and a cost of about 2.5% to 2.6%. That was lower than what we were paying on bonds that we're doing it at the end of the year. So we thought that was an opportune moment to move, reducing the CP piece a little bit of flexibility for us in terms of the revolver capacity that we have. And in uncertain period that we're in having some additional flexibility is good and it was a relatively inexpensive app to go out and get it. In terms of the repurchases, you know what you saw on the quarter is we were steady. We said originally 2.4 billion authorization from the board roughly covers six quarters at about 400 a quarter. That's what we did this quarter. Get a little bit more in the first quarter when the share price was a little bit beaten down. And given where we sit today that was a good move. So I would again, as is typically my answer over the last few years is steady as she goes on capital returns. We continue to grow our profitability, we continue to grow our capital returns, we continue to grow our dividend. And we'll continue to look that -- look to do that. And we will continue to look to the debt markets opportunistically to continue. As I mentioned, again, in my prepared remarks, another thing I want people to make sure that you don't notice, our return on invested capital is now back at 10%. And our weighted average cost-of-debt is now about 5.5. So, the overall balance sheet management has reduced that costs even as the business has generated increasing returns.

And our next question will come from Mike Carrier with Bank of America. Please go ahead.

Good morning. Thanks for the question. You guys have been making good traction and you've talked a lot about some of the viewers that I included in ETFs Hub and mortgages. Ben, I think you mentioned, a large ATM ahead, how are you thinking about that, as longer term revenue opportunity? What maybe ICE is focused on? And given the potential piece of trash that you're seeing and it seems like in a little bit faster than you would have expected? How do you see that maybe be plan out relative to expectations?

Thanks, Mike. Similar to the answer I gave in the question a couple ago that Alex had. I think the way to think about it is that the real near-term revenue growth opportunities that are right in front of us that we're already capturing, is really in that mortgage services business and how well positioned we are for the automation of that closed and post closed process. Then especially with COVID, all the assets that we have went from nice to have assets to absolute must have assets. And we are onboarding customers at an unprecedented rate into our platforms for the registration of e-notes for getting onto Simplifile to plug into those more jurisdictions coming on board, more agents coming on board, and looking to rapidly, rapidly onboard onto these products and increasing adoption. And as I mentioned, there's right in front of us, three to four significant growth opportunities that we're capitalizing on in terms of new business opportunities that we're capturing in that mortgage services business. For fixed income, we're establishing that network. It takes a while to get established into that institutional space for execution and all of the data points that I've been talking about on each of these calls, how fast we're getting this platform up the volume that's coming through the platform. How much of our network is already established. And as the network gets established, it really feeds on itself. So we think we're very well positioned there, for a medium to long term growth opportunity in execution. Remember in fixed income we don't look at it as just an execution business. To solve the real problems in fixed income it's going to require that billion dollar business a year that we have in fixed income that's really the cornerstone is our pricing our analytics business, and marrying those rich analytics and pricing services with execution and partnering with buy side and sell side clients to plug into real inefficient workflows because we're well positioned and that we're the only one that has really that comprehensive of all of the assets there to help solve them.

Our next question will come from Kyle Voigt with KBW. Please go ahead.

Maybe question on M&A, you highlight in your prepared remarks the diversity of your business. Just wondering if where you still see holes? Or where you're seeing more opportunities to add to your broader portfolio still, whether that's a mortgage or consumer through back through elsewhere? And then maybe also on update on what you're seeing the current M&A environment in terms of more or less opportunities say versus a year ago?

Sure. Well, I think it's a complicated environment. I had a very interesting conversation with one of the senior investment bankers in our space about the difficulty in two CEOs, meeting and getting to know each other and determining if their businesses would be good together where we're working from home and can't travel and can't have face to face conversation. And so the M&A market as a result of that is much more about that we're seeing as much more about companies, particularly private equity owned companies that are going to run a process for their sale or merger. And in those kinds of situations, we are trying to be the most disciplined investor, Scott mentioned, we track our return on invested capital, we track our cost of capital. And so while it's easy to make M&A relatively easy to make M&A accretive due to the low interest rate environment that we're in, it's harder to make rational deals that have real long-term value creation for investors as opposed to giving our investors their money back and letting them make their own choices in the market. So it's complicated. That said, there are a lot of private equity owned businesses. So we've participated in a number of different, took a look at a number of different processes in the last quarter. And obviously, not done anything or we would have announced it. But I'm also seeing that COVID-19 environment has really created winners and losers in many spaces, including financial services. We have a lot of inquiries from in tech type companies that are worried about their future funding capabilities. These generally are companies that are loss making companies and built themselves to try to get scale in a world where there was a lot of capital freely floating around and now investors seem to be more disciplined and these companies are looking for larger sponsors, if you will, to both their businesses to. Again because we're disciplined investors and target things like accretion dilution return on invested capital. Those deals are hard for us on a just purely financial basis. So we're only looking at things where we think those acquisitions would accelerate an initiative that we already are working on. And it's essentially a buy versus build strategy or a speed to market strategy. And those things are floating around, but again, and we've looked at a lot, but not seeing anything that really would move the needle for us. So long story short, we're in a very good position. We've got access to capital. We've got a lot of initiatives going on. Our productivity is high, because a lot of what we talked about on this call is about building, technology and systems to help our customers and interestingly, a tech focused firm can do well in this environment, because our people are actually being pretty productive, working from home. So we're in a great position. It's the right thing, where to come along. But it's a complicated environment for M&A just due to the social distancing that's going on.

And our next question will come from Owen Lau with Oppenheimer. Please go ahead.

Could you please give us more color on the progress of your partnership with MSCI? For example, the integration of ICE pricing and reference data into MSCI platform, and also the progress of launching more futures contracts based on MSCI index? Thanks.

Thank you very much. This is Ben, Owen. Our partnership with MSCI is very strong. It's been a long standing relationship that we continue to look for opportunities to grow, and we're going to continue to engage with them actively on a number of different indices and a number of different futures that we can launch around the world. It's obviously been a very strong growth business for us for a long time with the futures in that business. We've seen a little bit in recent times, with the volatility and the risk that there is in the market, we've seen a bit of a pullback, on things like emerging markets when you're in a high risk environment people tend to pull back from the markets when they're -- when you have that kind of volatility in it. But we've seen a 15% increase in Q2 in this business and a lot of that is on the back of the IFA business, which is another significant contract that we have. So we're looking at them actively, partnering with them on all kinds of view new growth opportunities, and the real estate relationship is very strong.

This concludes our question-and-answer session. I would like to turn the conference back over to Jeff Sprecher for any closing remarks. Please go ahead.

Well, thank you, Chuck for moderating the call. And I want to thank everybody for joining us. We look forward to speaking with you again soon until that happens I hope that you and your loved ones stay safe and healthy. And that you guys try to have a good day. Thank you.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.