Cboe Global Markets 10-Q 2021-09-30

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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For the quarterly period ended September 30, 2021

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OR

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☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

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For the transition period from to

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Commission file number: 001-34774

Cboe Global Markets, Inc.

(Exact Name of Registrant as Specified in Its Charter)

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Delaware	20-5446972
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

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433 West Van Buren Street**,** Chicago**,** Illinois	60607
(Address of Principal Executive Offices)	(Zip Code)

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(312) 786-5600

**(Registrant’s telephone number, including area code) **​

Securities registered pursuant to Section 12(b) of the Act:

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Title of each class:		Trading Symbol		Name of each exchange on which registered:
Common Stock, par value $0.01 per share	​	CBOE	​	CboeBZX

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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ⌧ No ◻

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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ◻

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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Large Accelerated filer	☒	Accelerated Filer	◻	Non-accelerated Filer	◻
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Smaller Reporting Company	☐	Emerging Growth Company	☐	​	​

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ⌧

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Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date:

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Class		October 22, 2021
Common Stock, par value $0.01 per share	​	106,642,977 shares

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TABLE OF CONTENTS

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​	​	Page
PART I. FINANCIAL INFORMATION		7
Item 1.	Financial Statements (unaudited)	7
​	Condensed Consolidated Balance Sheets—As of September 30, 2021 and December 31, 2020	7
​	Condensed Consolidated Statements of Income—Three and Nine Months Ended September 30, 2021 and 2020	8
​	Condensed Consolidated Statements of Comprehensive Income—Three and Nine Months Ended September 30, 2021 and 2020	9
​	Condensed Consolidated Statements of Changes in Stockholders’ Equity—Three and Nine Months Ended September 30, 2021 and 2020	10
​	Condensed Consolidated Statements of Cash Flows—Nine Months Ended September 30, 2021 and 2020	12
​	Notes to Condensed Consolidated Financial Statements	13
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Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	42
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	69
Item 4.	Controls and Procedures	72
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PART II. OTHER INFORMATION		73
Item 1.	Legal Proceedings	73
Item 1A.	Risk Factors	74
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	75
Item 3.	Defaults upon Senior Securities	75
Item 4.	Mine Safety Disclosures	75
Item 5.	Other Information	75
Item 6.	Exhibits	76
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SIGNATURES		77
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CERTAIN DEFINED TERMS

Throughout this document, unless otherwise specified or the context so requires:

	●	“Cboe,” “we,” “us,” “our” or “the Company” refers to Cboe Global Markets, Inc. and its subsidiaries.

	●	“ADV” means average daily volume.

	●	“ADNV” means average daily notional value.

	●	“AFM” refers to the Netherlands Authority for the Financial Markets.

	●	“ATS” refers to an alternative trading system.

	●	“Bats Global Markets” and “Bats” refer to our wholly-owned subsidiary Bats Global Markets, Inc., now known as Cboe Bats, LLC, and its subsidiaries.

	●	“BIDS Trading” refers to BIDS Trading, L.P., a wholly-owned subsidiary of Cboe Global Markets, Inc. The ATS operated by BIDS Trading is not a registered national securities exchange or a facility thereof.

	●	“BYX” refers to Cboe BYX Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“BZX” refers to Cboe BZX Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“C2” refers to Cboe C2 Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“Cboe Chi-X Europe” refers to Cboe Chi-X Europe Limited, a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“Cboe Europe Equities and Derivatives” refers to the combined businesses of Cboe Europe and Cboe NL.

	●	“Cboe Europe” refers to Cboe Europe Limited, a wholly-owned subsidiary of Cboe Global Markets, Inc., the UK operator of our Multilateral Trading Facility (“MTF”), our Regulated Market (“RM”), and our Approved Publication Arrangement (“APA”) under its Recognized Investment Exchange (“RIE”) status.

	●	“Cboe FX” refers to Cboe FX Markets, LLC, a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“Cboe NL” refers to Cboe Europe BV, a wholly-owned subsidiary of Cboe Global Markets, Inc., the Netherlands operator of our MTF, RM, and APA.

	●	“Cboe Options” refers to Cboe Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“Cboe SEF” refers to Cboe SEF, LLC, a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“Cboe Swiss” refers to Cboe Switzerland GmbH, a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“Cboe Trading” refers to Cboe Trading, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc., operated in the United States.

	●	“Chi-X Asia Pacific” refers to Chi-X Asia Pacific Holdings, Ltd., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“CFE” refers to Cboe Futures Exchange, LLC, a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“CFTC” refers to the U.S. Commodity Futures Trading Commission.

	●	“EDGA” refers to Cboe EDGA Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“EDGX” refers to Cboe EDGX Exchange, Inc., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“ESMA” refers to the European securities and Markets Authority.

	●	“EuroCCP” refers to European Central Counterparty N.V., a wholly-owned subsidiary of Cboe Global Markets, Inc.

	●	“Exchanges” refers to Cboe Options, C2, BZX, BYX, EDGX, and EDGA.

	●	“FASB” refers to the Financial Accounting Standards Board.

	●	“FCA” refers to the UK Financial Conduct Authority.

	●	“FINRA” refers to the Financial Industry Regulatory Authority.

	●	“GAAP” refers to Generally Accepted Accounting Principles in the United States.

	●	“IIROC” refers to the Investment Industry Regulatory Organization of Canada.

	●	“MATCHNow” refers to TriAct Canada Marketplace LP, a wholly-owned subsidiary of Cboe Global Markets, Inc., the operator of our Canadian ATS called MATCHNow.

	●	“Merger” refers to our acquisition of Bats Global Markets, completed on February 28, 2017.

	●	“OCC” refers to The Options Clearing Corporation.

	●	“OPRA” refers to Options Price Reporting Authority, LLC.

	●	“SEC” refers to the U.S. Securities and Exchange Commission.

	●	“SPX” refers to our S&P 500 Index exchange-traded options products.

	●	“TPH” refers to either a Trading Permit Holder or a Trading Privilege Holder.

	●	“VIX” refers to our Cboe Volatility Index exchange traded options and futures products.

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TRADEMARK AND OTHER INFORMATION

Cboe®, Cboe Global Markets®, Bats®, BIDS Trading®, BYX®, BZX®, Cboe Options Institute®, Cboe Vest®, Cboe Volatility Index®, CFE®, CHI-X®, EDGA®, EDGX®, EuroCCP®, Hybrid®, LiveVol®, MATCHNow®, Silexx® and VIX® are registered trademarks, and Cboe Futures ExchangeSM, C2SM, f(t)optionsSM, HanweckSM, and Trade AlertSM are service marks of Cboe Global Markets, Inc. and its subsidiaries. Standard & Poor's®, S&P®, S&P 100®, S&P 500® and SPX® are registered trademarks of Standard & Poor's Financial Services LLC and have been licensed for use by Cboe Exchange, Inc. Dow Jones®, Dow Jones Industrial Average®, DJIA® and Dow Jones Indices are registered trademarks or service marks of Dow Jones Trademark Holdings, LLC, used under license. Russell® and the Russell index names are registered trademarks of Frank Russell Company, used under license. FTSE® and the FTSE indices are trademarks and service marks of FTSE International Limited, used under license. All other trademarks and service marks are the property of their respective owners.

MSCI and the MSCI index names are service marks of MSCI Inc. (“MSCI”) or its affiliates and have been licensed for use by us. Any derivative indices and any financial products based on the derivative indices (“MCSI-Based Products”) are not sponsored, guaranteed or endorsed by MSCI, its affiliates or any other party involved in, or related to, making or compiling such MSCI index. Neither MSCI, its affiliates nor any other party involved in, or related to, making or compiling any MSCI index makes any representations regarding the advisability of investing in such MSCI-Based Products; makes any warranty, express or implied; or bears any liability as to the results to be obtained by any person or any entity from the use of any such MSCI index or any data included therein. No purchaser, seller or holder of any MSCI-Based Product, or any other person or entity, should use or refer to any MSCI trade name, trademark or service mark to sponsor, endorse, market or promote any security without first contacting MSCI to determine whether MSCI’s permission is required.

This Quarterly Report on Form 10-Q includes market share and industry data that we obtained from industry publications and surveys, reports of governmental agencies and internal company surveys. Industry publications and surveys generally state that the information they contain has been obtained from sources believed to be reliable, but we cannot assure you that this information is accurate or complete. We have not independently verified any of the data from third-party sources nor have we ascertained the underlying economic assumptions relied upon therein. Statements as to our market position are based on the most currently available market data. While we are not aware of any misstatements regarding industry data presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors. We refer you to the “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q and our other filings with the SEC.

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FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties. You can identify these statements by forward-looking words such as “may,” “might,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” and the negative of these terms and other comparable terminology. All statements that reflect our expectations, assumptions or projections about the future other than statements of historical fact are forward-looking statements, including statements in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of this Report. These forward-looking statements, which are subject to known and unknown risks, uncertainties and assumptions about us, may include projections of our future financial performance based on our growth strategies and anticipated trends in our business. These statements are only predictions based on our current expectations and projections about future events. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from those expressed or implied by the forward-looking statements. In particular, you should consider the risks and uncertainties described under “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q and our other filings with the SEC.

While we believe we have identified material risks, these risks and uncertainties are not exhaustive. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

Some factors that could cause actual results to differ include:

	●	the impact of the novel coronavirus (“COVID-19”) pandemic, including changes to trading behavior broadly in the market;

	●	the loss of our right to exclusively list and trade certain index options and futures products;

	●	economic, political and market conditions;

	●	compliance with legal and regulatory obligations;

	●	price competition and consolidation in our industry;

	●	decreases in trading or clearing volumes, market data fees or a shift in the mix of products traded on our exchanges;

	●	legislative or regulatory changes or changes in tax regimes;

	●	our ability to protect our systems and communication networks from security risks, cybersecurity risks, insider threats and unauthorized disclosure of confidential information;

	●	increasing competition by foreign and domestic entities;

	●	our dependence on and exposure to risk from third parties;

	●	fluctuations to currency exchange rates;

	●	factors that impact the quality and integrity of our indices;

	●	our ability to operate our business without violating the intellectual property rights of others and the costs associated with protecting our intellectual property rights;

	●	our ability to attract and retain skilled management and other personnel;

	●	our ability to minimize the risks, including our credit and default risks, associated with operating a European clearinghouse;

	●	our ability to accommodate trading and clearing volume and transaction traffic, including significant increases, without failure or degradation of performance of our systems;

	●	misconduct by those who use our markets or our products or for whom we clear transactions;

	●	challenges to our use of open source software code;

	●	our ability to meet our compliance obligations, including managing potential conflicts between our regulatory responsibilities and our for-profit status;

	●	our ability to maintain BIDS Trading as an independently managed and operated trading venue, separate from and not integrated with our registered national securities exchanges;

	●	damage to our reputation;

	●	the ability of our compliance and risk management methods to effectively monitor and manage our risks;

	●	our ability to manage our growth and strategic acquisitions or alliances effectively;

	●	restrictions imposed by our debt obligations and our ability to make payments on or refinance our debt obligations;

	●	our ability to maintain an investment grade credit rating;

	●	impairment of our goodwill, long-lived assets, investments or intangible assets; and

	●	the accuracy of our estimates and expectations.

For a detailed discussion of these and other factors that might affect our performance, see Part II, Item 1A of this Report. We do not undertake, and expressly disclaim, any duty to update any forward-looking statement whether as a result of new information, future events or otherwise, except as required by law. We caution you not to place undue reliance on the forward-looking statements, which speak only as of the date of this filing.

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PART I—FINANCIAL INFORMATION

Cboe Global Markets, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(unaudited)

(in millions, except par value data and share amounts)

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​		September 30,			December 31,
​	​	2021		​	2020
Assets
Current assets:	​	​	​	​	​	​
Cash and cash equivalents	​	$	392.4	​	$	245.4
Financial investments	​	​	26.7	​	​	92.4
Accounts receivable, net of $1.3 allowance for credit losses at September 30, 2021 and $0.6 at December 31, 2020	​	​	324.2	​	​	337.3
Margin deposits and clearing funds	​	​	1,665.6	​	​	812.1
Income taxes receivable	​		48.3	​		53.1
Other current assets	​		41.6	​		26.5
Total current assets	​		2,498.8	​		1,566.8
​	​	​	​	​	​	​
Investments	​		36.0	​		42.7
Land	​		2.3	​		—
Property and equipment, net	​	​	102.4	​	​	82.6
Property held for sale	​	​	—	​	​	13.0
Operating lease right of use assets	​	​	114.1	​	​	111.0
Goodwill	​	​	3,024.7	​	​	2,895.1
Intangible assets, net	​	​	1,701.0	​	​	1,729.0
Other assets, net	​		103.4	​		76.3
Total assets	​	$	7,582.7	​	$	6,516.5
Liabilities and Stockholders’ Equity
Current liabilities:	​	​	​	​	​	​
Accounts payable and accrued liabilities	​	$	259.6	​	$	250.0
Section 31 fees payable	​	​	9.7	​	​	152.9
Deferred revenue	​	​	13.9	​	​	10.2
Margin deposits and clearing funds	​	​	1,665.6	​	​	812.1
Income taxes payable	​	​	5.7	​		4.2
Current portion of long-term debt	​	​	—	​	​	68.7
Current portion of contingent consideration liabilities	​		63.2	​		15.2
Total current liabilities	​		2,017.7	​		1,313.3
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Long-term debt	​		1,298.9	​	​	1,135.2
Unrecognized tax benefits	​		196.8	​	​	164.7
Deferred income taxes	​		393.9	​	​	377.6
Non-current operating lease liabilities	​	​	132.9	​	​	132.1
Contingent consideration liabilities	​	​	12.0	​	​	17.5
Other non-current liabilities	​	​	33.5	​		27.2
Total liabilities	​	​	4,085.7	​	​	3,167.6
Commitments and contingencies	​	​	​	​	​	​
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Stockholders’ equity:	​	​	​	​	​	​
Preferred stock, $0.01 par value: 20,000,000 shares authorized, no shares issued and outstanding at September 30, 2021 and December 31, 2020	​	​	—	​	​	—
Common stock, $0.01 par value: 325,000,000 shares authorized, 126,226,121 and 106,642,977 shares issued and outstanding, respectively at September 30, 2021 and 125,998,967 and 107,299,933 shares issued and outstanding, respectively at December 31, 2020	​		1.3	​		1.2
Common stock in treasury, at cost, 19,583,144 shares at September 30, 2021 and 18,699,034 shares at December 31, 2020	​		(1,337.7)	​		(1,250.4)
Additional paid-in capital	​		2,736.3	​		2,713.3
Retained earnings	​		2,031.1	​		1,809.8
Accumulated other comprehensive income, net	​		66.0	​		75.0
Total stockholders’ equity	​		3,497.0	​		3,348.9
Total liabilities and stockholders’ equity	​	$	7,582.7	​	$	6,516.5

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See accompanying notes to condensed consolidated financial statements.

Cboe Global Markets, Inc. and Subsidiaries

Condensed Consolidated Statements of Income

(unaudited)

(in millions, except per share data)

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​	​	Three Months Ended September 30,					​	Nine Months Ended September 30,
​		2021			2020			2021			2020
Revenues:	​	​	​	​	​	​	​	​	​	​	​	​
Transaction and clearing fees	​	$	632.9	​	$	545.5	​	$	2,014.3	​	$	1,825.3
Access and capacity fees	​	​	72.8	​	​	60.6	​	​	206.3	​	​	174.0
Market data fees	​		62.0	​		59.5	​		188.6	​		174.4
Regulatory fees	​		34.6	​		113.8	​		173.0	​		379.3
Other revenue	​		14.5	​		13.3	​		46.2	​		29.9
Total revenues	​		816.8	​		792.7	​		2,628.4	​		2,582.9
Cost of revenues:	​	​	​	​	​	​	​	​	​	​	​	​
Liquidity payments	​		375.3	​		359.4	​		1,255.0	​		1,167.4
Routing and clearing	​	​	19.0	​	​	14.9	​	​	66.0	​	​	48.6
Section 31 fees	​	​	27.9	​	​	105.4	​	​	148.6	​	​	351.8
Royalty fees	​		22.0	​		17.6	​		62.6	​		64.4
Other	​		3.1	​		3.4	​		10.6	​		3.5
Total cost of revenues	​		447.3	​		500.7	​		1,542.8	​		1,635.7
Revenues less cost of revenues	​		369.5	​		292.0	​		1,085.6	​		947.2
Operating expenses:	​	​	​	​	​	​	​	​	​	​	​	​
Compensation and benefits	​		74.0	​		59.2	​		214.0	​		167.4
Depreciation and amortization	​		42.8	​		39.5	​		125.4	​		118.0
Technology support services	​		16.7	​		15.1	​		50.1	​		39.5
Professional fees and outside services	​		24.0	​		15.8	​		62.0	​		43.0
Travel and promotional expenses	​		2.3	​		1.2	​		5.8	​		4.2
Facilities costs	​		5.8	​		4.5	​		16.5	​		12.7
Acquisition-related costs	​		6.7	​		6.2	​		11.9	​		16.4
Other expenses	​	​	6.5	​	​	11.2	​	​	14.6	​	​	18.6
Total operating expenses	​		178.8	​		152.7	​		500.3	​		419.8
Operating income	​		190.7	​		139.3	​		585.3	​		527.4
Non-operating (expenses) income:	​	​	​	​	​	​	​	​	​	​	​	​
Interest expense, net	​		(11.7)	​		(9.5)	​		(36.3)	​		(24.1)
Other (expense) income, net	​		(5.2)	​		33.6	​		(3.1)	​		34.2
Income before income tax provision	​		173.8	​		163.4	​		545.9	​		537.5
Income tax provision	​		53.4	​		53.5	​		182.8	​		156.6
Net income	​	​	120.4	​	​	109.9	​	​	363.1	​	​	380.9
Net income allocated to participating securities	​	​	(0.4)	​	​	(0.3)	​	​	(1.1)	​	​	(1.0)
Net income allocated to common stockholders	​	$	120.0	​	$	109.6	​	$	362.0	​	$	379.9
Basic earnings per share	​	$	1.12	​	$	1.01	​	$	3.38	​	$	3.47
Diluted earnings per share	​	$	1.12	​	$	1.01	​	$	3.38	​	$	3.46
​	​	​	​	​	​	​	​	​	​	​	​	​
Basic weighted average shares outstanding	​	​	106.8	​	​	108.7	​	​	107.0	​	​	109.5
Diluted weighted average shares outstanding	​	​	107.0	​	​	108.8	​	​	107.2	​	​	109.8

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See accompanying notes to condensed consolidated financial statements.

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Cboe Global Markets, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(unaudited)

(in millions)

​	​	​	​	​	​	​	​	​	​	​	​	​
​		Three Months Ended September 30,						**Nine Months Ended September

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The following discussion should be read in conjunction with the accompanying unaudited condensed consolidated financial statements and the notes thereto, included in Item 1 in this Quarterly Report on Form 10-Q, and the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, and as contained in that report, the information under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” This discussion contains forward-looking information. Please see “Forward-Looking Statements” for a discussion of the uncertainties, risks and assumptions associated with these statements.

Overview

Cboe Global Markets, Inc. (“Cboe” or “the Company”), a leading provider of market infrastructure and tradable products, delivers cutting-edge trading, clearing and investment solutions to market participants around the world. The company is committed to operating a trusted, inclusive global marketplace, providing leading products, technology and data solutions that enable participants to define a sustainable financial future. Cboe provides trading solutions and products in multiple asset classes, including equities, derivatives and FX, across North America, Europe, and Asia Pacific.

Cboe’s subsidiaries include the largest options exchange and the third largest stock exchange operator in the U.S. In addition, the Company operates one of the largest stock exchanges by value traded in Europe, and owns EuroCCP, a leading pan-European equities clearinghouse, BIDS Trading, a leading block-trading ATS by volume in the U.S., MATCHNow, a leading equities ATS in Canada, and Chi-X Asia Pacific, a holding company of alternative market operators and providers of innovative market solutions. Cboe also is a leading market globally for exchange-traded products (“ETPs”) listings and trading.

The Company is headquartered in Chicago with offices in Amsterdam, Belfast, Calgary, Hong Kong, Kansas City, London, Manila, New York, San Francisco, Sarasota Springs, Singapore, Sydney, Tokyo and Toronto.

Recent Developments

Acquisition of BIDS Holdings

On December 31, 2020, the Company completed the acquisition of BIDS Holdings, which is included in the Company’s North American Equities segment. BIDS Holdings owns BIDS Trading, a registered broker-dealer and the operator of the BIDS ATS, the largest block-trading ATS by volume in the U.S. The BIDS ATS is not a registered national securities exchange or a facility thereof. The acquisition follows Cboe and BIDS Trading’s successful partnership in Europe, which began in 2016 with the creation of Cboe LIS for European equities block-trading. Since its launch, Cboe LIS has grown to become one of the largest block-trading platforms in Europe. BIDS Trading’s proven block-trading capability provides the Company a foothold in the off-exchange segment of the U.S. equities market. Additionally, BIDS Trading’s differentiated network of global buy-side investment managers and sell-side constituents provides the foundation for Cboe to potentially build more off-exchange products and services in non-U.S. equities or options products and in geographies beyond the U.S.

Acquisition of Chi-X Asia Pacific

On July 1, 2021, the Company completed the acquisition of Chi-X Asia Pacific Holdings, Ltd., a holding company of alternative market operators and providers of innovative market solutions. This acquisition provides the Company with a single point of entry into two key capital markets, Australia and Japan, helps enable it to expand its global equities and market data business into the Asia Pacific region, bring other products and services to the region, and further expand access to its unique proprietary product suite in the region. The transaction closed on July 1, 2021 based upon the time zone of both the acquiree, Chi-X Asia Pacific, and the acquiror, Cboe Worldwide Holdings Limited, a subsidiary of the Company.

Planned acquisition of ErisX

On October 20, 2021, the Company announced it entered into a definitive agreement to acquire Eris Digital Holdings, LLC (“ErisX”). ErisX operates a U.S. based digital asset spot market, a regulated futures exchange and a regulated clearing house. Ownership of ErisX presents a unique opportunity for the Company to enter the digital asset spot and derivatives marketplaces through a digital-first platform developed with industry partners to focus on robust regulatory

compliance, data and transparency. The transaction is expected to close in the first half of 2022; subject to regulatory review and other customary closing conditions.

Business Segments

The Company reports five business segments: Options, North American Equities, Futures, Europe and Asia Pacific (formerly Europe), and Global FX. Segment performance is primarily based on operating income (loss). The Company has aggregated all of its corporate costs and eliminations, as well as other business ventures, within Corporate Items and Eliminations; however, operating expenses that relate to activities of a specific segment have been allocated to that segment. Our management allocates resources, assesses performance and manages our business according to these segments:

Options. The Options segment includes listed options on market indices (“index options”), as well as on the stocks of individual corporations (“equity options”) and options on ETPs, such as exchange-traded funds (“ETFs”) and exchange-traded notes (“ETNs”), which are “multi-listed” options and listed on a non-exclusive basis. These options trade on Cboe Options, C2 Options, BZX Options, and EDGX Options, all U.S. national security exchanges. Cboe Options is the Company’s primary options market and offers trading in listed options through a single system that integrates electronic trading and traditional open outcry trading on the Cboe Options trading floor in Chicago. C2 Options, BZX Options, and EDGX Options are all-electronic options exchanges, and typically operate with different market models and fee structures than Cboe Options. The Options segment also includes applicable market data revenue generated from the consolidated tape plans, the licensing of proprietary options market data, index licensing, and access and capacity services.

North American Equities. The North American Equities segment includes listed U.S. equities and ETP transaction services that occur on fully electronic exchanges owned and operated by BZX Equities, BYX Equities, EDGX Equities, and EDGA Equities and Canadian equities and other transaction services that occur on or through the MATCHNow ATS. In addition, in connection with the closing of the acquisition of BIDS Trading, starting January 1, 2021, this segment also includes equities transactions that occur on the BIDS Trading platforms. The North American Equities segment also includes ETP listings on BZX, the Cboe Global Markets, Inc. common stock listing, applicable market data revenue generated from the consolidated tape plans, the licensing of proprietary equities market data, routing services, and access and capacity services.

Futures. The Futures segment includes transaction services provided by the Company’s fully electronic futures exchange, CFE, which includes offerings for trading of VIX futures and other futures products, the licensing of proprietary market data, as well as access and capacity services.

Europe and Asia Pacific (formerly Europe). The Europe and Asia Pacific segment includes the pan-European listed equities and derivatives transaction services, ETPs, exchange-traded commodities, and international depository receipts that are hosted on MTFs operated by Cboe Europe Equities and Derivatives. It also includes the ETP listings business on RMs and clearing activities of EuroCCP, as well as the equities transaction services of Chi-X Asia Pacific, a holding company of alternative market operators and provider

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As a result of our operating activities, we are exposed to market risks such as foreign currency exchange rate risk, equity risk, credit risk, interest rate risk, and liquidity risk. We have implemented policies and procedures to measure, manage and monitor and report risk exposures, which are reviewed regularly by management and our board of directors.

Foreign Currency Exchange Rate Risk

Our operations in Europe, Canada and Asia are subject to increased currency translation risk as revenues and expenses are denominated in foreign currencies, primarily the British pound, Canadian dollar, Singapore dollar, Hong Kong dollar, Euro, Australian dollar, and Japanese Yen. We also have de minimis exposure to other foreign currencies, including the Swiss Franc, Norwegian Kroner, Swedish Krona, Danish Kroner, and Philippine Peso.

​

For the three and nine months ended September 30, 2021, our exposure to foreign-denominated revenues and expenses is presented by primary foreign currency in the following table (in millions, except percentages):

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended											​	Nine Months Ended
​	​	September 30, 2021											​	September 30, 2021
​	​	British			​	​			​	Canadian			​	British			​	​			​	Canadian
​		Pound (1)			​	Euro (1)				Dollar (1)				Pound (1)			​	Euro (1)				Dollar (1)
Foreign denominated % of:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Revenues	​	​	2.2	%	​	​	3.2	%	​	​	0.2	%	​	​	1.9	%	​	​	2.6	%	​	​	0.2	%
Cost of revenues	​	​	—	%	​	​	2.7	%	​	​	—	%	​	​	0.1	%	​	​	1.8	%	​	​	—	%
Operating expenses	​	​	1.6	%	​	​	5.6	%	​	​	1.4	%	​	​	3.4	%	​	​	5.7	%	​	​	1.5	%
Impact of 10% adverse currency fluctuation on:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Revenues	​	$	1.8	​	​	$	2.6	​	​	$	0.2	​	​	$	5.0	​	​	$	6.7	​	​	$	0.6	​
Cost of revenues	​	​	—	​	​	​	1.2	​	​	​	—	​	​	​	0.2	​	​	​	2.7	​	​	​	—	​
Operating expenses	​	​	0.3	​	​	​	1.0	​	​	​	0.3	​	​	​	1.7	​	​	​	2.9	​	​	​	0.8	​

(1)	An average foreign exchange rate to the U.S. dollar for the period was used. See Item 2 (“Management’s Discussion and Analysis”) for the table summarizing the changes in certain operational and financial metrics for more information.

Equity Risk

Our investment in European and Canadian, and Asia Pacific operations is exposed to volatility in currency exchange rates through translation of our net assets or equity to U.S. dollars. The assets and liabilities of our European business are denominated in British pounds or Euros. The assets and liabilities of our Canadian business are denominated in Canadian dollars. The assets and liabilities of our Asia Pacific business are denominated in Hong Kong dollars, Australian dollars, Japanese Yen, or Philippine Pesos. Fluctuations in currency exchange rates may create volatility in our reported results as we are required to translate foreign currency reported statements of financial condition and operational results into U.S. dollars for consolidated reporting. The translation of these non-U.S. dollar statements of financial condition into U.S. dollars for consolidated reporting results in a cumulative translation adjustment, which is recorded in accumulated other comprehensive income, net within stockholders' equity on our condensed consolidated balance sheet.

Our primary exposure to this equity risk as of September 30, 2021 is presented by foreign currency in the following table (in millions):

​	​	​	​	​	​	​	​	​	​
​	​	British		​	​		​	Canadian
​		Pounds (1)		​	Euro (1)		​	Dollars (1)
Net equity investment in Cboe Europe, EuroCCP, and MATCHNow		$	674.3	​	$	90.9	​	$	148.1
Impact on consolidated equity of a 10% adverse currency fluctuation		​	67.4	​	​	9.1	​	​	14.8

(1)	Converted to U.S. dollars using the foreign exchange rate of British pounds per U.S. dollar, Euros per U.S. dollar, and Canadian dollars per U.S. dollar, respectively, as of September 30, 2021.

Credit Risk

We are exposed to credit risk from third parties, including customers, counterparties and clearing agents. These parties may default on their obligations due to bankruptcy, lack of liquidity, operational failure or other reasons. We limit our exposure to credit risk by considering such risk when selecting the counterparties with which we make investments and execute agreements.

We do not have counterparty credit risk with respect to trades matched on our exchanges in the U.S., Canada, and Europe. With respect to listed equities, we deliver matched trades of our customers to the National Security Clearing Corporation (“NSCC”) without taking on counterparty risk for those trades. NSCC acts as a central counterparty on all equity transactions occurring on BZX, BYX, EDGX and EDGA and, as such, guarantees clearance and settlement of all of our matched equity trades. Similarly, with respect to U.S. listed equity options and futures, we deliver matched trades of our customers to the OCC, which acts as a central counterparty on all transactions occurring on Cboe Options, C2, BZX, EDGX and CFE and, as such, guarantees clearance and settlement of all of our matched options and futures trades. With

respect to Canadian equities, we deliver matched trades of our customers to The Canadian Depository for Securities, which acts as a central counterparty on all transactions occurring on MATCHNow and, as such, guarantees clearance and settlement of all of our matched Canadian equities trades. The BIDS Trading ATS platform delivers matched trades to BofA Securities, Inc., which delivers the matched trades to the NSCC. With respect to Australian equities and derivatives, we deliver matched trades of our customers to ASX Clear Pty Ltd and ASX Settlement Pty Ltd. ASX Clear Pty Ltd acts as a central counterparty on all transactions occurring on Chi-X Australia and, as such, guarantees clearance and settlement on all of our matched trades in Australia. With respect to Japanese equities, we deliver matched trades of our customers to the Japanese Securities Clearing Corporation, which acts as a central counterparty on all transactions occurring on Chi-X Japan and, as such, guarantees clearance and settlement on all of our matched trades in Japan.

With respect to orders Cboe Trading routes to other markets for execution on behalf of our customers, Cboe Trading is exposed to some counterparty credit risk in the case of failure to perform on the part of our clearing firms, Morgan Stanley or Wedbush. Morgan Stanley and Wedbush guarantee trades until one day after the trade date, after which time NSCC provides a guarantee. Thus, Cboe Trading is potentially exposed to credit risk to the counterparty to a trade routed to another market center between the trade date and one day after the trade date in the event that Morgan Stanley or Wedbush fails. We believe that any potential requirement for us to make payments under these guarantees is remote and accordingly, have not recorded any liability in the condensed consolidated financial statements for these guarantees.

Historically, we have not incurred any liability due to a customer’s failure to satisfy its contractual obligations as counterparty to a system trade. Credit difficulties or insolvency, or the perceived possibility of credit difficulties or insolvency, of one or more larger or more visible market participants could also result in market-wide credit difficulties or other market disruptions.

We do not have counterparty credit risk with respect to institutional spot FX trades occurring on our platform because Cboe FX is not a counterparty to any FX transactions. All transactions occurring on our platform occur bilaterally between two banks or prime brokers as counterparties to the trade. While Cboe FX does not have direct counterparty risk, Cboe FX may suffer a decrease in transaction volume if a bank or prime broker experiences an event that causes other prime brokers to decrease or revoke the credit available to the prime broker experiencing the event. Therefore, Cboe FX may have risk that is related to the credit of the banks and prime brokers that trade FX on the Cboe FX platform.

We also have credit risk related to transaction fees that are billed in arrears to customers on a monthly basis. Our potential exposure to credit losses on these transactions is represented by the receivable balances in our balance sheet. Our customers are financial institutions whose ability to satisfy their contractual obligations may be impacted by volatile securities markets.

As a result of the acquisition of EuroCCP on July 1, 2020, the Company is exposed to further credit risk through our clearing operations. EuroCCP holds material amounts of clearing participant collateral, both cash and non-cash deposits, which are held or invested primarily to provide security of capital while minimizing credit risk as well as liquidity and market risks. The following is a summary of the risks associated with these deposits and how these risks are mitigated:

	●	Credit Risk - The credit risk is predominantly in the event a clearing participant fails to meet a financial or contractual obligation. EuroCCP attempts to mitigate this risk through minimum participant requirements for clearing participants and monitoring their financial health. To cover potential loss to EuroCCP in the event of a clearing participant default, collateral is required from clearing participants. Besides potential defaults of clearing participants, the main credit risk faced by the clearinghouse is exposure to clearing participants when a trade fails to settle. To help mitigate this risk, a fail fee is charged to discourage late settlements. This fee covers EuroCCP’s costs but also acts as a deterrent as required by Regulation (EU) No 236/2012 on short selling, together with certain aspects of credit default swaps.

	●	Liquidity Risk - Liquidity risk is the risk EuroCCP may not be able to meet its payment obligations in the right currency, in the right place and at the right time. To help mitigate this risk, EuroCCP monitors its liquidity requirements closely and maintains funds and assets in a manner which attempt to minimize the risk of loss or delay in the access by the clearinghouse to such funds and assets. For example, holding funds with a central bank where possible or making only short-term investments serves to help reduce liquidity risks. Liquidity is mainly required for securities settlement. The payment and settlement obligations generally stem from the function of EuroCCP as a cash equity clearinghouse: shares are bought and sold by clearing participants on a trading platform or OTC, and netted to settle two days later. During the settlement the actual payment for and delivery of the shares take place, this process requires intraday liquidity. If counterparties, which receive shares against payment, are unable to settle, an overnight liquidity need arises. The overnight liquidity is typically very short term, and is usually limited to a few days.

	●	Market Risk - EuroCCP is also exposed to market risk in the event that a clearing participant defaults and the market prices of the securities in its open positions have moved adversely so the clearinghouse can only close out the participant’s obligations at a loss. To help mitigate market risk, EuroCCP collects collateral from clearing participants to cover for the probable loss during normal market conditions, together with contributions to the clearing fund to cover losses if a default occurred during extreme but plausible market conditions. Adverse movements in exchange rates affecting the value of obligations and collateral are factored into the calculation of the amount of collateral to be collected.

On a regular basis, we review and evaluate changes in the status of our counterparties’ creditworthiness. Credit losses such as those described above could adversely affect our condensed consolidated financial position and results of operations. Any such effects to date have been minimal.

Interest Rate Risk

We have exposure to market risk for changes in interest rates relating to our cash and cash equivalents, financial investments, and indebtedness. As of September 30, 2021 and 2020, our cash and cash equivalents and financial investments were $419.1 million and $235.5 million, respectively, of which $166.4 million and $116.8 million is held outside of the United States in various foreign subsidiaries in 2021 and 2020, respectively. The remaining cash and cash equivalents and financial investments are denominated in U.S. dollars. We do not use our investment portfolio for trading or other speculative purposes. Due to the nature of these investments, we have not been exposed to, nor do we anticipate being exposed to, material risks due to changes in interest rates, assuming no change in the amount or composition of our cash and cash equivalents and financial investments.

As of September 30, 2021, we had $1,298.9 million in outstanding debt, of which $1,139.5 million relates to our Senior Notes, which bear interest at fixed interest rates. Changes in interest rates will have no impact on the interest we pay on fixed-rate obligations. The remaining amounts outstanding of $159.4 million relates to the Term Loan Agreement, which bears interest at fluctuating rates and, therefore, subjects us to interest rate risk. A hypothetical 100 basis point increase in interest rates relating to the amounts outstanding under the Term Loan Agreement as of September 30, 2021 would decrease annual pre-tax earnings by $1.6 million, assuming no change in the composition of our outstanding indebtedness. We are also exposed to changes in interest rates as a result of borrowings under our Revolving Credit Agreement and the EuroCCP Credit Facility, as these facilities bear interest at fluctuating rates. As of September 30, 2021, there were no outstanding borrowings under our Revolving Credit agreement and no outstanding borrowings under the EuroCCP Credit Facility. See Note 10 (“Debt”) to the condensed consolidated financial statements for a discussion of debt agreements.

Liquidity Risk

We are exposed to liquidity risk under certain circumstances in relation to the cross-acceleration and cross-default provisions within the Term Loan Agreement and the Revolving Credit Agreement as a result of the Company, as guarantor, entering into the EuroCCP Credit Facility. A default of the Facility may allow lenders to accelerate any related drawn amounts and may result in the acceleration of the Company’s other outstanding debt to which a cross-acceleration or cross-default provision applies, which may limit the Company’s liquidity, business and financing activities. See Note 10 (“Debt”) to the condensed consolidated financial statements for a discussion of debt agreements.

a)Disclosure controls and procedures. The Company’s management, with the participation of its Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Securities Exchange Act of 1934) as of the end of the period covered by this report. Based upon that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective.

b)Internal controls over financial reporting. As of September 30, 2021, we have integrated the acquired European Central Counterparty N.V. operations into our overall internal controls over financial reporting.

Except as described above, no changes occurred in the Company’s internal control over financial reporting during third quarter 2021 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

Cboe incorporates herein by reference the discussion set forth in Note 19 (“Income Taxes”) and Note 21 (“Commitments, Contingencies, and Guarantees”) of the condensed consolidated financial statements included herein.

Other than the legal proceedings below, there have been no material updates during the period covered by this Form 10-Q to the Legal Proceedings as set forth in Item 3. of our Annual Report on Form 10-K for the year ended December 31, 2020.

CT Plan Order (Continuation of Consolidated Data Plans Proceeding)

​

On May 6, 2020, the SEC issued an order (the “Consolidated Data Plan Order”) that directed the U.S. equities exchanges and FINRA to submit a new National Market System (“NMS”) Plan regarding Consolidated Equity Market Data. The contemplated new NMS Plan is referred to as the “CT Plan” and it will replace three Equity Data Plans that govern the dissemination of real-time, consolidated market data for NMS stocks. The Consolidated Data Plan Order set forth certain changes to be included in the proposed CT Plan, including governance structure changes related to voting rights and a deadline of August 11, 2020 by which the proposed CT Plan had to be filed.

On June 29, 2020, the Company filed a Petition for Review (“PFR”) with the Court of Appeals for the D.C. Circuit Court (“D.C. Circuit) challenging the Consolidated Data Plan Order. Briefing concluded on March 12, 2021 and oral argument was held on April 26, 2021. On June 15, 2021, the D.C. Circuit issued an order dismissing the PFR for lack of jurisdiction, holding that the Consolidated Data Plan Order was not a “final order” because the SEC had not determined whether the challenged features would make it into the new CT Plan.

On August 6, 2021, the SEC issued an order approving the CT Plan that was previously filed on August 11, 2020 (as mandated by the Consolidated Data Plan Order) and subject to public comment (“CT Plan Order”). On August 9, 2021, the Company filed another PFR with the D.C. Circuit challenging the CT Plan Order and the prior Consolidated Data Plan Order. On September 13, 2021, the Company filed a motion requesting that the D.C. Circuit stay the CT Plan Order pending resolution of the appeal and also requesting that the D.C. Circuit expedite the appeal. On October 13, 2021, the D.C. Circuit granted the motion to stay the CT Plan order and to expedite the appeal. A briefing schedule has been established and briefing will occur in the fourth quarter of 2021 and conclude in the first quarter of 2022.

The new CT Plan approved by the SEC may cause the Company’s equities exchanges, BZX, BYX, EDGX, and EDGA, to require additional resources to comply with or challenge such new consolidated data plan and it may have a material impact on our business, financial condition and operating results if, for example, there is a negative impact on the applicable market data revenues that we receive that are generated from such new plan.

Market Data Infrastructure Final Rule

​

On December 9, 2020, the SEC issued a Market Data Infrastructure Final Rule (“Final Rule”), which makes significant additions to the content available on the Securities Information Processors (“SIPs”) and replaces the exclusive processors with a competing consolidator model. The Final Rule is limited to market data disseminated by the equities SIPs and does not apply to proprietary market data, or the dissemination of options market data through OPRA.

On February 5, 2021, the Company filed a Petition for Review (the “2/5 PFR”) with the Court of Appeals for the D.C. Circuit challenging the Final Order. Additionally, on February 5, 2021, the Company filed a motion for stay of the Final Rule with the SEC, which the SEC denied on March 24, 2021.

On March 24, 2021, the SEC filed a Motion to Dismiss (“MTD”) with the D.C. Circuit: (1) arguing that the PFR is not ripe because the Final Rule had not been published in the Federal Register (“FR”), (2) suggesting (if there is ambiguity) that the D.C. Circuit clarify whether publication in the FR opens the filing window, and (3) suggesting that the D.C. Circuit could hold the case in abeyance pending filing of a PFR after publication in the FR.

On April 9, 2021, the Final Rule was published in the FR. On April 13, 2021, the Company filed another PFR (the “4/13 PFR””) as a protective measure in the event the D.C. Circuit determined that the time to file a PFR does not commence until publication of the Final Rule in the FR.

On June 15, 2021, the D.C. Circuit entered an order granting the SEC’s MTD respecting the 2/5 PFR. This order does not affect the 4/13 PFR, which was filed after publication of the Final Rule in the FR on April 9, 2021. On July 9, 2021, the D.C. Circuit entered a briefing schedule and briefing is scheduled to conclude on January 20, 2022.

The implementation of the Final Rule could cause Cboe’s equities exchanges, BZX, BYX, EDGX, and EDGA, to require additional resources to comply with or to challenge the new rules and they may have a material impact on our business, financial condition and operating results if, for example, there are lower SIP plan revenues or we must reduce the fees we charge for market data. The Company intends to litigate the matter vigorously.

Other than the risk factors listed below, there have been no material updates during the period covered by this Form 10-Q to the Risk Factors as set forth in Item 1A. of our Annual Report on Form 10-K for the year ended December 31, 2020. These risks and uncertainties, however, are not the only risks and uncertainties that we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also significantly impact us. Any of these risks and uncertainties may materially and adversely affect our business, financial condition or results of operations, liquidity and cash flows.

​

Risks Relating to Legal and Regulatory Matters

​

If one or more of the index providers from which we have licenses or service providers with respect to proprietary products fails to maintain the quality and integrity of their indices or fails to perform under our agreements with them or if customer preferences change, or if we fail to maintain the quality and integrity of our proprietary indices**, revenues we generate from trading in these proprietary products or the calculation and dissemination of index values may suffer.**

We are a party to a number of license agreements pursuant to which we may list for trading products based on various indices including pursuant to license agreements that we have with S&P, Dow Jones, LSEG and MSCI. These license agreements authorize us to list products based on a number of indices, and some of the resulting index options and futures are among the most actively traded products on our exchanges. We also enter into licensing agreements pursuant to which we calculate and disseminate values of proprietary indices. We believe that demand for our products is based in part on market perception of the quality and integrity of these indices. The quality and integrity of each of these indices are dependent on the ability of the index providers, including us, to maintain the index, including by means of the calculation and rebalancing of the index, and are dependent on the index providers for a number of things, including the provision of index data. We also rely on index providers to enforce intellectual property rights against unlicensed uses of the indices and uses of the indices that infringe on our licenses. Furthermore, some of our agreements concerning our proprietary products provide for the parties to those agreements to provide important services to us. If any of our index providers, including us, are unable to maintain the quality and integrity of their indices, or if any of the index providers or service providers fail to perform their obligations under the agreements, trading in these products, and therefore transaction fees we receive, may be materially adversely affected or we may not receive the financial benefits of the agreements that we negotiated.

​

We have in the past discovered instances, and we may in the future discover instances, where the spot Cboe Volatility Index (“VIX Index”) calculation differs from the calculation described in the VIX White Paper, which details the formula used for deriving values related to the VIX Index, including those instances that we announced on July 30, 2021. In those certain instances, the calculation of the spot VIX Index was not possible, resulting in the republication of the last published spot VIX Index value. In addition, from time to time we have in the past also discovered issues, and we may in the future discover issues, in the spot VIX Index calculation, such as incorrectly zeroing-out market quotes in the calculation of the spot VIX Index. Differences in the calculations or incorrect calculations of spot VIX Index values or our other spot volatility indices or the failure to implement any planned changes may result in the loss of perceived quality and integrity of our indices, loss of demand for our products, increased potential for investigations and enforcement proceedings, and increased exposure to third party claims and related litigation expenses, which could have a material adverse effect on our business, financial condition and operating results.

​

Changes in the tax laws and regulations affecting us, our products and our market participants could have a material adverse effect on our business.

Legislation may be proposed, both domestically and internationally, that could add a transaction tax on our products or change the way that our market participants are taxed on the products they trade on our markets. More recently, a number of federal, state and local jurisdictions in the U.S. and EU Member States have considered a financial transaction

tax, but many details remain to be discussed and agreed, including how to assess the tax. Additionally, the proposed Modernization of Derivatives Tax Act of 2021 would introduce in the U.S. mark-to-market tax treatment for all derivatives contracts and require gains and losses be taxed at ordinary income tax rates. If such proposals were to become law, they could have a negative impact on the securities industry and on us by making transactions more costly to market participants, which may impact derivatives trading behavior, reduce trading or clearing and could make our markets less competitive, and they could result in a reduction in volumes and liquidity, which would have a negative impact on our operations.

In addition to proposed tax changes that could affect our market participants, like other corporations, we are subject to taxes at federal, state and local levels, as well as in non-U.S. jurisdictions. Changes in tax laws, regulations or policies or successful claims by tax authorities could result in our having to pay higher taxes, which would in turn reduce our net income. If this occurs, we may experience a higher effective tax rate.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Share repurchase program

In 2011, the board of directors approved an initial authorization for the Company to repurchase shares of its outstanding common stock of $100 million and approved additional authorizations of $100 million in each of 2012, 2013, 2014, 2015 and 2016, $250 million in each of 2018, 2019 and 2020, and $200 million in February 2021, for a total authorization of $1.6 billion. The program permits the Company to purchase shares through a variety of methods, including in the open market or through privately negotiated transactions, in accordance with applicable securities laws. It does not obligate the Company to make any repurchases at any specific time or situation. The Company did not repurchase shares of its common stock under its share repurchase program during the third quarter of 2021 and had $318.9 million of availability remaining under its existing share repurchase authorizations as of September 30, 2021.

Purchase of common stock from employees

The table below reflects the acquisition of common stock by the Company in the three months ended September 30, 2021 that were not part of the publicly announced share repurchase authorization. These shares consisted of shares retained to cover payroll withholding taxes in connection with the vesting of restricted stock unit awards and performance share awards.

​	​	​	​	​	​
Period		Total Number of Shares Purchased		Average Price Paid per Share
July 1 to July 31, 2021	​	464	​	$	118.00
August 1 to August 31, 2021	​	998	​	​	127.00
September 1 to September 30, 2021	​	—	​	​	—
Total	​	1,462	​	​	​

​

Use of Proceeds

None.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

None.

​

​	​	​
​	​	​
Exhibit No.		Description
​	​	​
3.1	​	Seventh Amended and Restated Bylaws, incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 001-34774) filed on August 5, 2021.
​	​	​
10.1	​	Amendment No. 18 to the Restated License Agreement, dated November 1, 1994, by and between Standard & Poor’s Financial Services LLC (as successor-in-interest to Standard & Poor’s, a division of McGraw-Hill, Inc.) and Cboe Exchange, Inc. (f/k/a Chicago Board Options Exchange, Incorporated), made as of October 26, 2021 (filed herewith).+
​	​	​
31.1	​	Certification of Chief Executive Officer pursuant to Rule 13a-14 (Filed herewith).
​	​	​
31.2	​	Certification of Chief Financial Officer pursuant to Rule 13a-14 (Filed herewith).
​	​	​
32.1	​	Certificate of Chief Executive Officer pursuant to Rule 13a-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (Filed herewith).
​	​	​
32.2	​	Certificate of Chief Financial Officer pursuant to Rule 13a-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (Filed herewith).
​	​	​
101.INS	​	XBRL Instance Document (Filed herewith). — The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
​	​	​
101.SCH	​	XBRL Taxonomy Extension Schema Document (Filed herewith).
​	​	​
101.CAL	​	XBRL Taxonomy Extension Calculation Linkbase Document (Filed herewith).
​	​	​
101.DEF	​	XBRL Taxonomy Extension Definition Linkbase (Filed herewith).
​	​	​
101.LAB	​	XBRL Taxonomy Extension Label Linkbase Document (Filed herewith).
​	​	​
101.PRE	​	XBRL Taxonomy Extension Presentation Linkbase Document (Filed herewith).
​	​	​
104	​	Cover Page Interactive Data File (embedded as Inline XBRL document).

​

+Certain confidential portions (as indicated therein) of this exhibit have been omitted.

​

​

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

​	​	​
​	CBOE GLOBAL MARKETS, INC.
​	Registrant
​	​	​
​	By:	/s/ Edward T. Tilly
​	​	Edward T. Tilly
​	​	President and Chief Executive Officer
​	​	(Principal Executive Officer)
Date: October 29, 2021		​
​	​	​
​	By:	/s/ Brian N. Schell
​	​	Brian N. Schell
​	​	Executive Vice President and Chief Financial Officer
​	​	(Principal Financial Officer)
Date: October 29, 2021		​

​

​