Item 1. Consolidated Financial Statements

151K characters. Original on sec.gov · Markdown

Item 1. Consolidated Financial Statements

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Balance Sheets

(In millions, except per share amounts)


	As of		As of December 31, 2022
	June 30, 2023
	(Unaudited)
Assets:
Current assets:
Cash and cash equivalents	$	2,877	$	1,799
Short-term restricted cash and cash equivalents	5,413		6,149
Restricted short-term investments	735		—
Cash and cash equivalent margin deposits and guaranty funds	86,917		141,990
Invested deposits, delivery contracts receivable and unsettled variation margin	1,412		5,382
Customer accounts receivable, net of allowance for doubtful accounts of $25 and $22 at June 30, 2023 and December 31, 2022, respectively	1,313		1,169
Prepaid expenses and other current assets	555		458
Total current assets	99,222		156,947
Property and equipment, net	1,718		1,767
Other non-current assets:
Goodwill	21,134		21,111
Other intangible assets, net	12,814		13,090
Long-term restricted cash and cash equivalents	205		405
Long-term restricted investments	199		—
Other non-current assets	991		1,018
Total other non-current assets	35,343		35,624
Total assets	$	136,283	$	194,338

Liabilities and Equity:
Current liabilities:
Accounts payable and accrued liabilities	$	919	$	866
Section 31 fees payable	173		223
Accrued salaries and benefits	226		352
Deferred revenue	437		170
Short-term debt	—		4
Margin deposits and guaranty funds	86,917		141,990
Invested deposits, delivery contracts payable and unsettled variation margin	1,412		5,382
Other current liabilities	120		184
Total current liabilities	90,204		149,171
Non-current liabilities:
Non-current deferred tax liability, net	3,256		3,493
Long-term debt	18,128		18,118
Accrued employee benefits	156		160
Non-current operating lease liability	218		254
Other non-current liabilities	432		381
Total non-current liabilities	22,190		22,406
Total liabilities	112,394		171,577
Commitments and contingencies



Equity:
Intercontinental Exchange, Inc. stockholders’ equity:
Preferred stock, $0.01 par value; 100 shares authorized; none issued or outstanding	—		—
Common stock, $0.01 par value; 1,500 shares authorized; 636 and 634 issued at June 30, 2023 and December 31, 2022, respectively, and 560 and 559 shares outstanding at June 30, 2023 and December 31, 2022, respectively	6		6
Treasury stock, at cost; 76 and 75 shares at June 30, 2023 and December 31, 2022, respectively	(6,276)		(6,225)
Additional paid-in capital	14,449		14,313
Retained earnings	15,925		14,943
Accumulated other comprehensive loss	(284)		(331)
Total Intercontinental Exchange, Inc. stockholders’ equity	23,820		22,706
Non-controlling interest in consolidated subsidiaries	69		55
Total equity	23,889		22,761
Total liabilities and equity	$	136,283	$	194,338

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Income

(In millions, except per share amounts)

(Unaudited)


	Six Months Ended June 30,				Three Months Ended June 30,
	2023		2022		2023		2022
Revenues:
Exchanges	$	3,214	$	3,247	$	1,541	$	1,604
Fixed income and data services	1,109		1,021		546		512
Mortgage technology	485		604		249		297
Total revenues	4,808		4,872		2,336		2,413
Transaction-based expenses:
Section 31 fees	175		174		56		123
Cash liquidity payments, routing and clearing	849		985		392		476
Total revenues, less transaction-based expenses	3,784		3,713		1,888		1,814
Operating expenses:
Compensation and benefits	703		714		351		355
Professional services	57		69		29		35
Acquisition-related transaction and integration costs	46		62		25		53
Technology and communication	345		344		173		169
Rent and occupancy	45		41		25		20
Selling, general and administrative	137		112		63		57
Depreciation and amortization	527		510		267		256
Total operating expenses	1,860		1,852		933		945
Operating income	1,924		1,861		955		869
Other income/(expense):
Interest income	193		9		102		8
Interest expense	(351)		(264)		(175)		(161)
Other income/(expense), net	(70)		(35)		(35)		23
Total other income/(expense), net	(228)		(290)		(108)		(130)
Income before income tax expense	1,696		1,571		847		739
Income tax expense	207		338		32		173
Net income	$	1,489	$	1,233	$	815	$	566
Net income attributable to non-controlling interest	(35)		(21)		(16)		(11)
Net income attributable to Intercontinental Exchange, Inc.	$	1,454	$	1,212	$	799	$	555
Earnings per share attributable to Intercontinental Exchange, Inc. common stockholders:
Basic	$	2.60	$	2.17	$	1.43	$	0.99
Diluted	$	2.59	$	2.16	$	1.42	$	0.99
Weighted average common shares outstanding:
Basic	560		560		560		558
Diluted	561		562		561		560

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

(In millions)

(Unaudited)


	Six Months Ended June 30,				Three Months Ended June 30,
	2023		2022		2023		2022
Net income	$	1,489	$	1,233	$	815	$	566
Other comprehensive income/(loss):
Foreign currency translation adjustments	47		(109)		31		(84)



Other comprehensive income/(loss)	47		(109)		31		(84)
Comprehensive income	$	1,536	$	1,124	$	846	$	482
Comprehensive income attributable to non-controlling interest	(35)		(21)		(16)		(11)
Comprehensive income attributable to Intercontinental Exchange, Inc.	$	1,501	$	1,103	$	830	$	471

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Changes in Equity and Redeemable Non-Controlling Interest

(In millions)

(Unaudited)


	Intercontinental Exchange, Inc. Stockholders’ Equity												Non- Controlling Interest in Consolidated Subsidiaries		Total Equity
	Common Stock			Treasury Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income/(Loss)
	Shares	Value		Shares	Value
Balance, as of December 31, 2022	634	$	6	(75)	$	(6,225)	$	14,313	$	14,943	$	(331)	$	55	$	22,761
Other comprehensive income	—	—		—	—		—		—		47		—		47

Exercise of common stock options	—	—		—	—		24		—		—		—		24


Payments relating to treasury shares	—	—		(1)	(51)		—		—		—		—		(51)
Stock-based compensation	—	—		—	—		94		—		—		—		94
Issuance under the employee stock purchase plan	—	—		—	—		18		—		—		—		18
Contribution from equity partners	—	—		—	—		—		—		—		9		9
Issuance of restricted stock	2	—		—	—		—		—		—		—		—

Distributions of profits	—	—		—	—		—		—		—		(30)		(30)
Dividends paid to stockholders	—	—		—	—		—		(472)		—		—		(472)


Net income/(loss) attributable to non-controlling interest	—	—		—	—		—		(35)		—		35		—
Net income	—	—		—	—		—		1,489		—		—		1,489
Balance, as of June 30, 2023	636	$	6	(76)	$	(6,276)	$	14,449	$	15,925	$	(284)	$	69	$	23,889


	Intercontinental Exchange, Inc. Stockholders’ Equity												Non- Controlling Interest in Consolidated Subsidiaries		Total Equity
	Common Stock			Treasury Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income/(Loss)
	Shares	Value		Shares	Value
Balance, as of March 31, 2023	635	$	6	(76)	$	(6,274)	$	14,388	$	15,362	$	(315)	$	44	$	23,211
Other comprehensive income	—	—		—	—		—		—		31		—		31

Exercise of common stock options	—	—		—	—		14		—		—		—		14


Payments relating to treasury shares	—	—		—	(2)		—		—		—		—		(2)
Stock-based compensation	—	—		—	—		47		—		—		—		47

Contribution from equity partners	—	—		—	—		—		—		—		9		9
Issuance of restricted stock	1	—		—	—		—		—		—		—		—


Dividends paid to stockholders	—	—		—	—		—		(236)		—		—		(236)


Net income/(loss) attributable to non-controlling interest	—	—		—	—		—		(16)		—		16		—
Net income	—	—		—	—		—		815		—		—		815
Balance, as of June 30, 2023	636	$	6	(76)	$	(6,276)	$	14,449	$	15,925	$	(284)	$	69	$	23,889

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Changes in Equity and Redeemable Non-Controlling Interest - (Continued)

(In millions)

(Unaudited)


	Intercontinental Exchange, Inc. Stockholders’ Equity												Non- Controlling Interest in Consolidated Subsidiaries		Total Equity
	Common Stock			Treasury Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income/(Loss)
	Shares	Value		Shares	Value
Balance, as of December 31, 2021	631	$	6	(70)	$	(5,520)	$	14,069	$	14,350	$	(196)	$	39	$	22,748
Other comprehensive loss	—	—		—	—		—		—		(109)		—		(109)
Exercise of common stock options	—	—		—	—		20		—		—		—		20
Repurchases of common stock	—	—		(4)	(632)		—		—		—		—		(632)
Payments relating to treasury shares	—	—		(1)	(71)		—		—		—		—		(71)
Stock-based compensation	—	—		—	—		88		—		—		—		88
Issuance under the employee stock purchase plan	—	—		—	—		24		—		—		—		24
Issuance of restricted stock	2	—		—	—		—		—		—		—		—
Distributions of profits	—	—		—	—		—		—		—		(13)		(13)
Dividends paid to stockholders	—	—		—	—		—		(427)		—		—		(427)

Net income/(loss) attributable to non-controlling interest	—	—		—	—		—		(21)		—		21		—
Net income	—	—		—	—		—		1,233		—		—		1,233
Balance, as of June 30, 2022	633	$	6	(75)	$	(6,223)	$	14,201	$	15,135	$	(305)	$	47	$	22,861


	Intercontinental Exchange, Inc. Stockholders’ Equity												Non- Controlling Interest in Consolidated Subsidiaries		Total Equity
	Common Stock			Treasury Stock			Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Income/(Loss)
	Shares	Value		Shares	Value
Balance, as of March 31, 2022	633	$	6	(74)	$	(6,064)	$	14,153	$	14,793	$	(221)	$	36	$	22,703
Other comprehensive loss	—	—		—	—		—		—		(84)		—		(84)

Exercise of common stock options	—	—		—	—		5		—		—		—		5

Repurchases of common stock	—	—		(1)	(157)		—		—		—		—		(157)
Payments relating to treasury shares	—	—		—	(2)		—		—		—		—		(2)
Stock-based compensation	—	—		—	—		43		—		—		—		43





Dividends paid to stockholders	—	—		—	—		—		(213)		—		—		(213)


Net income/(loss) attributable to non-controlling interest	—	—		—	—		—		(11)		—		11		—
Net income	—	—		—	—		—		566		—		—		566
Balance, as of June 30, 2022	633	$	6	(75)	$	(6,223)	$	14,201	$	15,135	$	(305)	$	47	$	22,861

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In millions)

(Unaudited)


	Six Months Ended June 30,
	2023		2022
Operating activities:
Net income	$	1,489	$	1,233
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	527		510
Stock-based compensation	85		76
Deferred taxes	(239)		(147)
Gain on sale of Euroclear investment	—		(41)


Net losses from unconsolidated investees	65		57

Other	26		21
Changes in assets and liabilities:
Customer accounts receivable	(181)		(177)
Other current and non-current assets	(66)		(48)
Section 31 fees payable	(50)		115
Deferred revenue	279		292
Other current and non-current liabilities	(130)		(166)
Total adjustments	316		492
Net cash provided by operating activities	1,805		1,725

Investing activities:
Capital expenditures	(61)		(70)
Capitalized software development costs	(142)		(134)
Purchases of invested margin deposits	(771)		(1,431)
Proceeds from sales of invested margin deposits	3,078		3,815
Cash paid for acquisitions, net of cash acquired	(5)		(36)

Purchases of equity and equity method investments	(6)		(43)
Proceeds from sale of Euroclear investment	—		741

Purchases of investments	(949)		—

Other	—		1

Net cash provided by investing activities	1,144		2,843

Financing activities:


Proceeds from/(repayments of) debt facilities, net	(4)		5,186

Redemption of commercial paper, net	—		(1,012)
Capital contributions from non-controlling interests	9		—
Repurchases of common stock	—		(632)
Dividends to stockholders	(472)		(427)
Change in cash and cash equivalent margin deposits and guaranty funds	(57,380)		16,163
Payments relating to treasury shares received for restricted stock tax payments and stock option exercises	(50)		(71)



Other	11		31
Net cash provided by/(used in) financing activities	(57,886)		19,238
Effect of exchange rate changes on cash, cash equivalents, restricted cash and cash equivalents, and cash and cash equivalent margin deposits and guaranty funds	6		(19)
Net increase/(decrease) in cash, cash equivalents, restricted cash and cash equivalents, and cash and cash equivalent margin deposits and guaranty funds	(54,931)		23,787
Cash, cash equivalents, restricted cash and cash equivalents, and cash and cash equivalent margin deposits and guaranty funds at beginning of period	150,343		147,976
Cash, cash equivalents, restricted cash and cash equivalents, and cash and cash equivalent margin deposits and guaranty funds at end of period	$	95,412	$	171,763

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Cash Flows (Continued)

(In millions)

(Unaudited)


	As of June 30, 2023		As of June 30, 2022
Supplemental cash flow disclosure:
Cash paid for income taxes	$	536	$	524
Cash paid for interest	$	341	$	226

Reconciliation of the components of cash, cash equivalents, restricted cash and cash equivalents, and cash and cash equivalent margin deposits and guaranty funds to the balance sheet:
Cash and cash equivalents	$	2,877	$	830
Short-term restricted cash and cash equivalents	5,413		6,045
Long-term restricted cash and cash equivalents	205		405
Cash and cash equivalent margin deposits and guaranty funds	86,917		164,483
Total	$	95,412	$	171,763

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)

**1.**Description of Business

Nature of Business and Organization

Intercontinental Exchange, Inc. is a provider of market infrastructure, data services and technology solutions to a broad range of customers including financial institutions, corporations and government entities. These products, which span major asset classes including futures, equities, fixed income and United States, or U.S., residential mortgages provide our customers with access to mission critical tools that are designed to increase asset class transparency and workflow efficiency. Our business is conducted through three reportable business segments:

Exchanges:** We operate regulated marketplaces for the listing, trading and clearing of a broad array of derivatives contracts and financial securities.
Fixed Income and Data Services:** We provide fixed income pricing, reference data, indices, analytics and execution services as well as global credit default swap, or CDS, clearing and multi-asset class data delivery solutions.
Mortgage Technology:** We provide a technology platform that offers customers comprehensive, digital workflow tools that aim to address the inefficiencies that exist in the U.S. residential mortgage market, from application through closing and the secondary market.

We operate marketplaces, technology and provide data services in the U.S., United Kingdom, or U.K., European Union, or EU, Canada, Asia Pacific and the Middle East.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP, pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC, regarding interim financial reporting. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements and should be read in conjunction with our audited consolidated financial statements and related notes thereto for the year ended December 31, 2022. The accompanying unaudited consolidated financial statements reflect all adjustments that are, in our opinion, necessary for a fair presentation of results for the interim periods presented. We believe that these adjustments are of a normal recurring nature.

Preparing financial statements in conformity with U.S. GAAP requires us to make certain estimates and assumptions that affect the amounts that are reported in our consolidated financial statements and accompanying disclosures. Actual amounts could differ from those estimates. The results of operations for the six months and three months ended June 30, 2023 are not necessarily indicative of the results to be expected for any future period or the full fiscal year.

These statements include the accounts of our wholly-owned and controlled subsidiaries. All intercompany balances and transactions between us and our wholly-owned and controlled subsidiaries have been eliminated in consolidation. For consolidated subsidiaries in which our ownership is less than 100% and for which we have control over the assets and liabilities and the management of the entity, the outside stockholders’ interests are shown as non-controlling interests.

We have considered the impacts of macroeconomic conditions during the quarter, including interest rates, the inflationary environment, geopolitical events and military conflicts, including repercussions from the conflict in Ukraine, and the impact that any of the foregoing may have on the global economy and on our business. As of June 30, 2023, our businesses and operations, including our exchanges, clearing houses, listings venues, data services businesses and mortgage platforms, have not suffered a material negative impact as a result of these events. There continues to be uncertainty surrounding the current macroeconomic environment and the impact that it may have on the global economy and on our business.

Recently Adopted Accounting Pronouncements

During the six months ended June 30, 2023, there were no significant changes to the new and recently adopted accounting pronouncements applicable to us from those disclosed in Note 2 to the consolidated financial statements in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2022, or the 2022 Form 10-K.

3. Pending Acquisition

Pending Acquisition of Black Knight, Inc.

On May 4, 2022, we announced that we had entered into a definitive agreement to acquire Black Knight, Inc., or Black Knight, a software, data and analytics company that serves the housing finance continuum, including real estate data, mortgage lending and servicing, as well as the secondary markets. Pursuant to that certain Agreement and Plan of Merger, dated as of May 4, 2022, among ICE, Sand Merger Sub Corporation, a wholly owned subsidiary of ICE, or Sub, and Black Knight, which we refer to as the “merger agreement,” Sub will merge with and into Black Knight, which we refer to as the “merger,” with Black Knight surviving as a wholly owned subsidiary of ICE.

On March 7, 2023, ICE and Black Knight announced that, in connection with the merger agreement, Black Knight has entered into an agreement to sell its Empower loan origination business. On March 7, 2023, ICE and Black Knight also entered into an amendment to the merger agreement to reduce the value of the aggregate transaction consideration to approximately $11.7 billion as of March 7, 2023, or $75 per share of Black Knight common stock, with cash comprising 90% of the value of the aggregate transaction consideration and shares of our common stock comprising 10% of the value of the aggregate transaction consideration. The aggregate cash component of the transaction consideration is fixed at $10.5 billion, and the value of the aggregate stock component of the transaction consideration will fluctuate with the market price of our common stock and will be determined based on the average of the volume weighted averages of the trading prices of our common stock on each of the ten consecutive trading days ending three trading days prior to the closing of the merger. If consummated, we expect that this transaction will build on our position as a provider of end-to-end electronic workflow solutions for the rapidly evolving U.S. residential mortgage industry. We believe the Black Knight ecosystem adds value for clients of all sizes across the mortgage and real estate lifecycles by helping organizations lower costs, increase efficiencies, grow their businesses, and reduce risk.

On March 30, 2023, our amended proxy statement/prospectus on Form S-4 was declared effective by the SEC, and on April 28, 2023, Black Knight stockholders approved the amendment to the merger agreement.

On July 17, 2023, we announced that we have agreed to sell Black Knight’s Optimal Blue business to the same purchaser as that of the Empower business for $700 million. The structure of this proposed transaction includes a payment of $200 million in cash, with the remainder financed by a $500 million promissory note issued by the purchaser to Black Knight, as a subsidiary of ICE, at the closing of the transaction. The closing of the proposed Optimal Blue divestiture transaction is subject to the closing of our acquisition of Black Knight, the closing of the acquisition of Black Knight’s Empower loan origination system business, and the satisfaction of other customary closing conditions.

The transaction is expected to close in the second half of 2023 following the receipt of regulatory approvals, a favorable resolution of the FTC litigation concerning this transaction, and the satisfaction of customary closing conditions. See Note 13 where additional details of this transaction are discussed.

4. Investments

Equity Investments Subject to ASU 2016-01

Our equity investments are subject to valuation under Accounting Standards Update, or ASU, 2016-01, Financial Instruments- Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, or ASU 2016-01. See Note 14 for a discussion of our determination of fair value of our financial instruments, which were not material as of June 30, 2023.

Investment in Euroclear

We previously owned a 9.8% stake in Euroclear, plc, or Euroclear, that we originally purchased for $631 million. We participated on the Euroclear Board of Directors, and we classified our investment in Euroclear as an equity investment.

During the three months ended June 30, 2022, we completed the sale of our 9.8% stake in Euroclear. The carrying value of our investment was $700 million at the time of the sale and was classified within other current assets on our balance sheet. We recorded a net gain on the sale of $41 million, which was included in other income, during the three months ended June 30, 2022.

Equity Method Investments

Our equity method investments include the Options Clearing Corporation, or OCC, and Bakkt Holdings, LLC, or Bakkt, among others. Our equity method investments are included in other non-current assets in the accompanying consolidated

balance sheet. We initially record our equity method investments at cost. At the end of each reporting period, we record our share of profits or losses of our equity method investments as equity earnings included in other income, and adjust the carrying value of our equity method investment accordingly. In addition, if and when our equity method investments issue cash dividends to us, we deduct the amount of these dividends from the carrying amount of that investment. We assess the carrying value periodically if impairment indicators are present.

We recognized $65 million and $57 million as our share of estimated losses, net, from our equity method investments during the six months ended June 30, 2023 and 2022, respectively, and $30 million and $15 million as our share of losses, net, from our equity method investments during the three months ended June 30, 2023 and 2022, respectively. The estimated losses during both the six months and three months ended June 30, 2023 and 2022 are primarily related to our investment in Bakkt, partially offset by our share of OCC profits. Both periods include adjustments to reflect the difference between reported prior period actual results from our original estimates.

When performing our assessment of the carrying value of our investments, we consider, among other things, the length of time and the extent to which the market value has been less than our cost basis, if applicable, the investee's financial condition and near-term prospects, the economic or technological environment in which our investees operate, weakening of the general market condition of the related industry, whether an investee can continue as a going concern, any impairment charges recorded by an investee on goodwill, intangible or long-lived assets, and our intent and ability to retain the investment for a period of time sufficient to allow for any anticipated recovery in market value.

Investment in OCC

We own a 40% interest in OCC through a direct investment by the New York Stock Exchange, or NYSE. OCC is regulated by the SEC as a registered clearing agency and by the Commodity Futures Trading Commission, or CFTC, as a derivatives clearing organization. OCC serves as a clearing house for securities options, security futures, commodity futures and options on futures traded on various independent exchanges. OCC clears securities options traded on NYSE Arca and NYSE Amex Options, along with other non-affiliated exchanges.

Investment in Bakkt

As of June 30, 2023, we held an approximate 64% economic interest in Bakkt. As a result of limitations on ICE from the Bakkt voting agreement entered into in connection with Bakkt's merger with VIH, we hold a minority voting interest in Bakkt and treat it as an equity method investment.

5. Revenue Recognition

Substantially all of our revenues are considered to be revenues from contracts with customers. The related accounts receivable balances are recorded in our balance sheets as customer accounts receivable. We do not have obligations for warranties, returns or refunds to customers, other than rebates, which are settled each period and therefore do not result in variable consideration. We do not have significant revenue recognized from performance obligations that were satisfied in prior periods, and we do not have any transaction price allocated to unsatisfied performance obligations other than in our deferred revenue. Certain judgments and estimates are used in the identification and timing of satisfaction of performance obligations and the related allocation of transaction price. We believe that these represent a faithful depiction of the transfer of services to our customers.

Deferred revenue represents our contract liabilities related to our annual, original and other listings revenues, certain data services, clearing services, mortgage technology services and other revenues. Deferred revenue is our only significant contract liability. See Note 7 for our discussion of deferred revenue balances, activity, and expected timing of recognition.

For all of our contracts with customers, except for listings and certain data, clearing and mortgage services, our performance obligations are short term in nature and there is no significant variable consideration. In addition, we have elected the practical expedient of excluding sales taxes from transaction prices. We have assessed the costs incurred to obtain or fulfill a contract with a customer, which are primarily our sales commissions.

Refer to Note 5 to the consolidated financial statements included in Part II, Item 8 of our 2022 Form 10-K where our primary revenue contract classifications are described in detail.

The following table depicts the disaggregation of our revenue according to business line and segment (in millions). Amounts here have been aggregated as they follow consistent revenue recognition patterns, and are consistent with the segment information in Note 15:


	Exchanges Segment		Fixed Income and Data Services Segment		Mortgage Technology Segment		Total Consolidated
Six Months Ended June 30, 2023:
Total revenues	$	3,214	$	1,109	$	485	$	4,808
Transaction-based expenses	1,024		—		—		1,024
Total revenues, less transaction-based expenses	$	2,190	$	1,109	$	485	$	3,784

Timing of Revenue Recognition
Services transferred at a point in time	$	1,263	$	229	$	148	$	1,640
Services transferred over time	927		880		337		2,144
Total revenues, less transaction-based expenses	$	2,190	$	1,109	$	485	$	3,784


	Exchanges Segment		Fixed Income and Data Services Segment		Mortgage Technology Segment		Total Consolidated
Three Months Ended June 30, 2023:
Total revenues	$	1,541	$	546	$	249	$	2,336
Transaction-based expenses	448		—		—		448
Total revenues, less transaction-based expenses	$	1,093	$	546	$	249	$	1,888

Timing of Revenue Recognition
Services transferred at a point in time	$	628	$	106	$	81	$	815
Services transferred over time	465		440		168		1,073
Total revenues, less transaction-based expenses	$	1,093	$	546	$	249	$	1,888


	Exchanges Segment		Fixed Income and Data Services Segment		Mortgage Technology Segment		Total Consolidated
Six Months Ended June 30, 2022:
Total revenues	$	3,247	$	1,021	$	604	$	4,872
Transaction-based expenses	1,159		—		—		1,159
Total revenues, less transaction-based expenses	$	2,088	$	1,021	$	604	$	3,713

Timing of Revenue Recognition
Services transferred at a point in time	$	1,197	$	159	$	270	$	1,626
Services transferred over time	891		862		334		2,087
Total revenues, less transaction-based expenses	$	2,088	$	1,021	$	604	$	3,713


	Exchanges Segment		Fixed Income and Data Services Segment		Mortgage Technology Segment		Total Consolidated
Three Months Ended June 30, 2022:
Total revenues	$	1,604	$	512	$	297	$	2,413
Transaction-based expenses	599		$	—	$	—	599
Total revenues, less transaction-based expenses	$	1,005	$	512	$	297	$	1,814

Timing of Revenue Recognition
Services transferred at a point in time	$	563	$	83	$	128	$	774
Services transferred over time	442		429		169		1,040
Total revenues, less transaction-based expenses	$	1,005	$	512	$	297	$	1,814

The Exchanges segment and the Fixed Income and Data Services segment revenues above include data services revenues. Our data services revenues are transferred over time, and a majority of those revenues are performed over a short period of time of one month or less and relate to subscription-based data services billed monthly, quarterly or annually in advance. These revenues are recognized ratably over time as our data delivery performance obligations are met consistently throughout the period.

The Exchanges segment revenues transferred over time in the table above also include services related to listings, services related to risk management of open interest performance obligations and services related to regulatory fees, trading permits, and software licenses.

The Fixed Income and Data Services segment revenues transferred over time in the table above also include services related to risk management of open interest performance obligations, primarily in our CDS business.

The Mortgage Technology segment revenues transferred over time in the table above primarily relate to our origination technology revenue where performance obligations consist of a series of distinct services and are recognized over the contract terms as subscription performance obligations are satisfied, and to a lesser extent, professional services revenues and revenues from certain of our data and analytics offerings.

The components of services transferred over time for each of our segments are as follows:


	Six Months Ended June 30,				Three Months Ended June 30,
	2023		2022		2023		2022
Exchanges Segment:
Data services revenues	$	463	$	432	$	231	$	218
Services transferred over time related to risk management of open interest performance obligations	151		139		$	75	$	63
Services transferred over time related to listings	252		260		$	126	$	131
Services transferred over time related to regulatory fees, trading permits, and software licenses	61		60		$	33	$	30
Total	$	927	$	891	$	465	$	442

Fixed Income Data Services Segment:
Data services revenues	$	864	$	843	$	434	$	421
Services transferred over time related to risk management of open interest performance obligations in our CDS business	16		19		$	6	$	8
Total	$	880	$	862	$	440	$	429

Mortgage Technology Segment:
Subscription revenues	$	329	$	316	$	164	$	160
Professional service revenues and other	8		18		$	4	$	9
Total	$	337	$	334	$	168	$	169

Total consolidated revenues transferred over time	$	2,144	$	2,087	$	1,073	$	1,040

6. Goodwill and Other Intangible Assets

The following is a summary of the activity in our goodwill balance for the six months ended June 30, 2023 (in millions):


Goodwill balance at December 31, 2022	$	21,111

Foreign currency translation	22
Other activity, net	1
Goodwill balance at June 30, 2023	$	21,134

The following is a summary of the activity in our other intangible assets balance for the six months ended June 30, 2023 (in millions):


Other intangible assets balance at December 31, 2022	$	13,090
Acquisitions	5
Foreign currency translation	20
Amortization of other intangible assets	(301)

Other intangible assets balance at June 30, 2023	$	12,814

Foreign currency translation adjustments result from a portion of our goodwill and other intangible assets being held at our U.K., EU and Canadian subsidiaries, whose functional currencies are not the U.S. dollar. The changes in other activity, net, in the table above primarily relate to adjustments to the fair value of the net tangible and intangible assets made within one year of acquisitions, with a corresponding adjustment to goodwill.

During the six months ended June 30, 2023, we considered potential indicators of impairment to goodwill and other intangible assets for each of our reporting units, which included continued global inflation concerns and rising interest rates, including their effect on our forecasts, among other things. As such, we performed this assessment to determine whether it was more-likely-than-not that goodwill and indefinite lived intangibles within each of our reportable business segments were impaired. Additionally, we evaluated whether the carrying value of the finite lived intangible assets within our reportable business segments may not be recoverable. After evaluating events, circumstances and factors which could affect the significant inputs used in our evaluation of cash flows and related fair value, we determined it was not more-likely-than-not that an impairment existed in our goodwill and indefinite lived intangible assets or that the carrying amount of our finite lived intangible assets was not recoverable. We plan to perform our annual impairment testing in the fourth quarter.

7. Deferred Revenue

Our contract liabilities, or deferred revenue, represent consideration received that is yet to be recognized as revenue. Total deferred revenue was $529 million as of June 30, 2023, including $437 million in current deferred revenue and $92 million in other non-current liabilities. The changes in our deferred revenue during the six months ended June 30, 2023 are as follows (in millions):


	Listings Revenues		Data Services and Other Revenues		Mortgage Technology		Total
Deferred revenue balance at January 1, 2023	$	115	$	88	$	51	$	254
Additions	474		236		32		742
Amortization	(252)		(175)		(40)		(467)
Deferred revenue balance at June 30, 2023	$	337	$	149	$	43	$	529

The changes in our deferred revenue during the six months ended June 30, 2022 are as follows (in millions):


	Listings Revenues		Data Services and Other Revenues		Mortgage Technology		Total
Deferred revenue balance at January 1, 2022	$	112	$	93	$	79	$	284
Additions	500		283		46		829
Amortization	(261)		(222)		(55)		(538)
Deferred revenue balance at June 30, 2022	$	351	$	154	$	70	$	575

Included in the amortization recognized during the six months ended June 30, 2023 is $103 million related to the deferred revenue balance as of January 1, 2023. Included in the amortization recognized for the six months ended June 30, 2022 is $119 million related to the deferred revenue balance as of January 1, 2022. As of June 30, 2023, the remaining deferred revenue balance will be recognized over the period of time we satisfy our performance obligations as described in Note 5.

8. Debt

Our total debt, including short-term and long-term debt, consisted of the following (in millions):


	As of June 30, 2023		As of December 31, 2022
Debt:
Short-term debt:



Other short-term debt	$	—	$	4
Total short-term debt	—		4
Long-term debt:




2025 Senior Notes (3.65% senior unsecured notes due May 23, 2025)	1,245		1,243
2025 Senior Notes (3.75% senior unsecured notes due December 1, 2025)	1,248		1,247
2027 Senior Notes (4.00% senior unsecured notes due September 15, 2027)	1,488		1,487
2027 Senior Notes (3.10% senior unsecured notes due September 15, 2027)	498		498
2028 Senior Notes (3.75% senior unsecured notes due September 21, 2028)	595		594
2029 Senior Notes (4.35% senior unsecured notes due June 15, 2029)	1,240		1,240
2030 Senior Notes (2.10% senior unsecured notes due June 15, 2030)	1,237		1,235
2032 Senior Notes (1.85% senior unsecured notes due September 15, 2032)	1,485		1,485
2033 Senior Notes (4.60% senior unsecured notes due March 15, 2033)	1,488		1,488
2040 Senior Notes (2.65% senior unsecured notes due September 15, 2040)	1,232		1,231
2048 Senior Notes (4.25% senior unsecured notes due September 21, 2048)	1,232		1,231
2050 Senior Notes (3.00% senior unsecured notes due June 15, 2050)	1,221		1,221
2052 Senior Notes (4.95% senior unsecured notes due June 15, 2052)	1,465		1,464
2060 Senior Notes (3.00% senior unsecured notes due September 15, 2060)	1,471		1,471
2062 Senior Notes (5.20% senior unsecured notes due June 15, 2062)	983		983
Total long-term debt	18,128		18,118
Total debt	$	18,128	$	18,122

Our senior notes of $18.1 billion have a weighted average maturity of 16 years and a weighted average cost of 3.6% per annum.

Credit Facilities

We have a $3.9 billion senior unsecured revolving credit facility, or the Credit Facility, with a maturity date of May 25, 2027, with future capacity to increase our borrowings under the Credit Facility by an additional $1.0 billion, subject to the consent of the lenders funding the increase and certain other conditions. No amounts were outstanding under the Credit Facility as of June 30, 2023.

As of June 30, 2023, of the $3.9 billion that was available for borrowing under the Credit Facility, $171 million was required to support certain broker-dealer and other subsidiary commitments. We did not have any amounts outstanding under our U.S. dollar commercial paper program, or the Commercial Paper Program, as of June 30, 2023. Therefore, there was not an amount required to backstop the Commercial Paper Program. The amount required to backstop the amounts

outstanding under the Commercial Paper Program will fluctuate as we increase or decrease our commercial paper borrowings. The remaining $3.7 billion was available for working capital and general corporate purposes including, but not limited to, acting as a backstop to future amounts outstanding under the Commercial Paper Program.

We have a $2.4 billion two-year senior unsecured delayed draw term loan facility, or the Term Loan, with a maturity date of May 25, 2024. Draws under the Term Loan bear interest on the principal amount outstanding at either (a) Term Secured Overnight Financing Rate, or Term SOFR, plus an applicable margin plus a credit spread adjustment of 10 basis points or (b) a "base rate" plus an applicable margin. The applicable margin ranges from 0.625% to 1.125% for Term SOFR loans and from 0.000% to 0.125% for base rate loans, in each case, based on a ratings-based pricing grid. We expect to use the proceeds from borrowings under the Term Loan to fund a portion of the purchase price for the Black Knight acquisition. We have the option to prepay outstanding amounts under the Term Loan in whole or in part at any time. No amounts were outstanding under the Term Loan as of June 30, 2023.

Our India subsidiaries maintain $14 million of credit lines for their general corporate purposes. As of June 30, 2023, there were no amounts outstanding under these credit lines.

Commercial Paper Program

Our Commercial Paper Program is currently backed by the borrowing capacity available under the Credit Facility, as described above. The effective interest rate of commercial paper issuances does not materially differ from short-term interest rates, which fluctuate due to market conditions and as a result may impact our interest expense. We did not have any notes outstanding under our Commercial Paper Program as of June 30, 2023.

9. Share-Based Compensation

We currently sponsor stock option plans, restricted stock plans and our Employee Stock Purchase Plan to our employees and directors. Stock options and restricted stock are granted at the discretion of the Compensation Committee of our Board of Directors, or Board, based on the estimated fair value on the date of grant. The fair value of the stock options and restricted stock on the date of grant is recognized as expense over the vesting period, net of forfeitures. The non-cash compensation expenses recognized in our consolidated statements of income for stock options, restricted stock and under our employee stock purchase plan, net of amounts classified as capitalized software, were $85 million and $76 million for the six months ended June 30, 2023 and 2022, respectively, and $45 million and $38 million during the three months ended June 30, 2023 and 2022, respectively.

Stock Option Plans

We use the Black-Scholes option pricing model to value our stock option awards. During the six months ended June 30, 2023 and 2022, we used the assumptions in the table below to compute the value:


	Six Months Ended June 30,
Assumptions:	2023	2022
Risk-free interest rate	3.47%	1.72%
Expected life in years	6.1	6.0
Expected volatility	24%	23%
Expected dividend yield	1.56%	1.17%
Estimated weighted-average fair value of options granted per share	$27.39	$28.18

The risk-free interest rate is based on the zero-coupon U.S. Treasury yield curve in effect at the date of grant. The expected life is derived from historical and anticipated future exercise patterns. Expected volatility is based on historical volatility data of our stock.

Restricted Stock Plans

Restricted shares are used as an incentive to attract and retain qualified employees and to align our and our stockholders' interests by linking actual performance to both short and long-term stockholder return. We issue awards that may contain a combination of time, performance and/or market conditions. The grant date fair value of each award is based on the closing stock price of our stock at the date of grant. The grant date fair value of time-based restricted stock is recognized as expense ratably over the vesting period, which is typically three or four years, net of forfeitures.

In February 2023, we reserved a maximum of 0.9 million restricted shares for potential issuance as performance-based restricted shares to certain of our employees. The number of shares ultimately granted under this award will be based on our actual financial performance as compared to financial performance targets set by our Board and the Compensation Committee for the year ending December 31, 2023, and will also be subject to a market condition reduction based on how

our 2023 total stockholder return, or TSR, compares to that of the S&P 500 Index. The maximum compensation expense to be recognized under these performance-based restricted shares is $92 million if the maximum financial performance target is met and all 0.9 million shares vest. The compensation expense to be recognized under these performance-based restricted shares will be $46 million if the target financial performance is met, which would result in 0.4 million shares vesting. For these awards with performance conditions, we recognize expense on an accelerated basis over the three-year vesting period based on our quarterly assessment of the probable 2023 actual financial performance as compared to the 2023 financial performance targets. As of June 30, 2023, our best estimate is that the financial performance level will be above target for 2023. Based on this assessment, we recorded non-cash compensation expense of $14 million and $10 million for the six months and three months ended June 30, 2023, respectively, related to these awards and the remaining $46 million in non-cash compensation expense will be recorded on an accelerated basis over the remaining vesting period, including $19 million which will be recorded over the remainder of 2023.

We also issue awards with a market condition but no performance condition. The fair value of these awards is estimated based on a simulation of various outcomes and includes inputs such as our stock price on the grant date, the valuation of historical awards with market conditions, the relatively low likelihood that the market condition will affect the number of shares granted (as the market condition only affects shares granted in excess of certain financial performance targets), and our expectation of achieving the financial performance targets.

10. Equity

Stock Repurchase Program

In December 2021, our Board approved an aggregate of $3.15 billion for future repurchases of our common stock with no fixed expiration date that became effective on January 1, 2022. The approval of our Board for the share repurchases does not obligate us to acquire any particular amount of our common stock. In addition, our Board may increase or decrease the amount available for repurchases from time to time. We fund repurchases from our operating cash flow or borrowings under our debt facilities or our Commercial Paper Program. Repurchases may be made from time to time on the open market, through established trading plans, in privately-negotiated transactions or otherwise, in accordance with all applicable securities laws, rules and regulations. We may begin or discontinue stock repurchases at any time and may amend or terminate a Rule 10b5-1 trading plan at any time or enter into additional plans, subject to applicable rules.

We did not have any share repurchases during the six months or three months ended June 30, 2023. During the six months and three months ended June 30, 2022, we repurchased a total of 5.0 million and 1.3 million shares, respectively, of our outstanding common stock at a cost of $632 million and $157 million, respectively. Our repurchases during the six months ended June 30, 2022 consisted of 4.6 million shares at a cost of $582 million under our Rule 10b5-1 trading plan and 0.4 million shares at a cost of $50 million on the open market during an open trading period. All shares repurchased during the three months ended June 30, 2022 were done under our Rule 10b5-1 trading plan. As of June 30, 2023, the remaining balance of Board approved funds for future repurchases was $2.5 billion. In connection with our pending acquisition of Black Knight, on May 4, 2022 we terminated our Rule 10b5-1 trading plan and suspended share repurchases.

Dividends

During the six months ended June 30, 2023 and 2022, we declared and paid cash dividends per share of $0.84 and $0.76, respectively, for an aggregate payout of $472 million and $427 million, respectively. During the three months ended June 30, 2023 and 2022, we declared dividends per share of $0.42 and $0.38, respectively for an aggregate payout of $236 million and $213 million, respectively. The declaration of dividends is subject to the discretion of our Board. Our Board has adopted a quarterly dividend declaration policy providing that the declaration of any dividends will be determined quarterly by the Board or the Audit Committee, taking into account such factors as our evolving business model, prevailing business conditions, our financial results and capital requirements and other considerations which our Board deems relevant, without a predetermined annual net income payout ratio.

Accumulated Other Comprehensive Income/(Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income/ (loss) (in millions):


	Changes in Accumulated Other Comprehensive Income/(Loss) by Component
	Foreign currency translation adjustments		Comprehensive income from equity method investment		Employee benefit plans adjustments		Total















Balance, as of December 31, 2022	$	(278)	$	2	$	(55)	$	(331)
Other comprehensive income	47		—		—		47
Income tax benefit/(expense)	—		—		—		—
Net current period other comprehensive income	47		—		—		47
Balance, as of June 30, 2023	$	(231)	$	2	$	(55)	$	(284)


	Changes in Accumulated Other Comprehensive Income/(Loss) by Component
	Foreign currency translation adjustments		Comprehensive income from equity method investment		Employee benefit plans adjustments		Total















Balance, as of March 31, 2023	$	(262)	$	2	$	(55)	$	(315)
Other comprehensive income	31		—		—		31
Income tax benefit/(expense)	—		—		—		—
Net current period other comprehensive income	31		—		—		31
Balance, as of June 30, 2023	$	(231)	$	2	$	(55)	$	(284)


	Changes in Accumulated Other Comprehensive Income/(Loss) by Component
	Foreign currency translation adjustments		Comprehensive income from equity method investment		Employee benefit plans adjustments		Total















Balance, as of December 31, 2021	$	(150)	$	2	$	(48)	$	(196)
Other comprehensive loss	(110)		—		—		(110)
Income tax benefit/(expense)	1		—		—		1
Net current period other comprehensive loss	(109)		—		—		(109)
Balance, as of June 30, 2022	$	(259)	$	2	$	(48)	$	(305)


	Changes in Accumulated Other Comprehensive Income/(Loss) by Component
	Foreign currency translation adjustments		Comprehensive income from equity method investment		Employee benefit plans adjustments		Total















Balance, as of March 31, 2022	$	(175)	$	2	$	(48)	$	(221)
Other comprehensive loss	(85)		—		—		(85)
Income tax benefit/(expense)	1		—		—		1
Net current period other comprehensive loss	(84)		—		—		(84)
Balance, as of June 30, 2022	$	(259)	$	2	$	(48)	$	(305)

11. Income Taxes

Our effective tax rate was 12% and 22% during the six months ended June 30, 2023 and 2022, respectively, and 4% and 23% during the three months ended June 30, 2023 and 2022, respectively. The effective tax rates for the six months and three months ended June 30, 2023 were lower than the effective tax rates for the comparable periods in 2022 primarily due to the tax benefits resulting from favorable audit settlements for prior years, deferred and current tax benefits from state apportionment changes and the application of the high-tax exception to the Global Intangible Low-Taxed Income, or GILTI, in the current period, partially offset by the impact of the U.K. corporate income tax increase from 19% to 25% effective April 1, 2023.

In conjunction with the increase in the U.K. corporate income tax rate, we intend to elect the GILTI high-tax exception election in 2023. During the three months ended June 30, 2023, our tax provision includes the impacts of this election, which resulted in a reduction in our GILTI inclusions. Our unrecognized tax benefit as of June 30, 2023 was $240 million, a $7 million net decrease from the $247 million as of December 31, 2022. The net decrease includes a $40 million

reduction as a result of audit settlements, a $20 million increase related to current year positions, a $31 million increase related to prior year positions, and an $18 million reduction related to prior year positions.

In August 2022, the Inflation Reduction Act of 2022, or IRA, was signed into law. The IRA introduced a 15% corporation minimum tax, or CAMT, on adjusted financial statement income for corporations with profits in excess of $1 billion, effective for tax years after December 31, 2022. Based on the current guidance provided by the Internal Revenue Service and Treasury, the implementation of the CAMT does not have a material impact to our financial statements as of June 30, 2023.

The IRA also includes a share buyback excise tax of 1% on share repurchases, which will apply to net share repurchases after December 31, 2022. During the six months ended June 30, 2023, we did not repurchase any shares, therefore, we were not subject to any excise tax. The newly imposed excise tax on share repurchases is not considered an income tax. Any excise tax, as a result of future share repurchases, will be considered part of the cost of the shares repurchased and reflected in the equity section of our consolidated financial statements.

12. Clearing Operations

We operate six clearing houses, each of which acts as a central counterparty that becomes the buyer to every seller and the seller to every buyer for its clearing members or participants, or Members. Through this central counterparty function, the clearing houses provide financial security for each transaction for the duration of the position by limiting counterparty credit risk.

Our clearing houses are responsible for providing clearing services to each of our futures exchanges, and in some cases to third-party execution venues, and are as follows, referred to herein collectively as "the ICE Clearing Houses":


Clearing House	Products Cleared	Exchange where Executed	Location
ICE Clear Europe	Energy, agricultural, interest rates and equity index futures and options contracts and OTC European CDS instruments	ICE Futures Europe, ICE Futures U.S., ICE Endex, ICE Futures Abu Dhabi and third-party venues	U.K.
ICE Clear U.S.	Agricultural, metals, foreign exchange, or FX, interest rate, equity index and digital asset futures and/or options contracts	ICE Futures U.S.	U.S.
ICE Clear Credit	OTC North American, European, Asian-Pacific and Emerging Market CDS instruments	Creditex and third-party venues	U.S.
ICE Clear Netherlands	Derivatives on equities and equity indices traded on regulated markets	ICE Endex	The Netherlands
ICE Clear Singapore	Energy, metals and financial futures products and digital asset futures contracts	ICE Futures Singapore	Singapore
ICE NGX	Physical North American natural gas and electricity	ICE NGX	Canada

In 2022, we announced our decision to cease our CDS clearing service at ICE Clear Europe, our clearing house in the U.K., and thereafter our sole CDS clearing offering will be at our ICE Clear Credit clearing house in the U.S. This is expected to be completed in late 2023.

Original and Variation Margin

Each of the ICE Clearing Houses generally requires all Members to deposit collateral in cash or certain pledged assets. The collateral deposits are known as “original margin.” In addition, the ICE Clearing Houses may make intraday original margin calls in circumstances where market conditions require additional protection. The daily profits and losses to and from the ICE Clearing Houses due to the marking-to-market of open contracts is known as “variation margin.” The ICE Clearing Houses mark all outstanding contracts to market, and, with the exception of ICE NGX’s physical natural gas and physical power products discussed separately below, pay and collect variation margin, at least once daily.

The amounts that Members are required to maintain are determined by proprietary risk models established by each ICE Clearing House and reviewed by the relevant regulators, independent model validators, risk committees and the boards of directors of the respective ICE Clearing House. The amounts required may fluctuate over time. Each of the ICE Clearing Houses is a separate legal entity and is not subject to the liabilities of the others, or the obligations of Members of the other ICE Clearing Houses.

Should a particular Member fail to deposit its original margin or fail to make a variation margin payment, when and as required, the relevant ICE Clearing House may liquidate or hedge the defaulting Member's open positions and use their original margin and guaranty fund deposits to pay any amount owed. In the event that the defaulting Member's deposits are not sufficient to pay the amount owed in full, the ICE Clearing Houses will first use their respective contributions to the

guaranty fund, often referred to as Skin In The Game, or SITG, to pay any remaining amount owed. In the event that the SITG is not sufficient, the ICE Clearing Houses may utilize the respective guaranty fund deposits and default insurance, or collect limited additional funds from their respective non-defaulting Members on a pro-rata basis, to pay any remaining amount owed.

As of June 30, 2023 and December 31, 2022, the ICE Clearing Houses had received or had been pledged $194.0 billion and $273.3 billion, respectively, in cash and non-cash collateral in original margin and guaranty fund deposits to cover price movements of underlying contracts for both periods.

Guaranty Funds and ICE Contribution

As described above, mechanisms have been created, called guaranty funds, to provide partial protection in the event of a Member default. With the exception of ICE NGX, each of the ICE Clearing Houses requires that each Member make deposits into a guaranty fund.

In addition, we have contributed our own capital that could be used if a defaulting Member’s original margin and guaranty fund deposits are insufficient. Included in the total contribution to ICE Clear U.S., as of June 30, 2023, is $15 million from Bakkt, solely applicable to any losses associated with a default in Bitcoin contracts and other digital assets that ICE Clear U.S. may clear in the future. Such amounts are recorded as long-term restricted cash and cash equivalents or long-term restricted investments in our balance sheets and are as follows (in millions):


	ICE Portion of Guaranty Fund Contribution		Default insurance
Clearing House	As of June 30, 2023	As of December 31, 2022	As of June 30, 2023	As of December 31, 2022
ICE Clear Europe	$247	$247	$100	$100
ICE Clear U.S.	90	90	25	25
ICE Clear Credit	50	50	75	75
ICE Clear Netherlands	2	2	N/A	N/A
ICE Clear Singapore	1	1	N/A	N/A
ICE NGX	15	15	200	200
Total	$405	$405	$400	$400

We also maintain default insurance as an additional layer of clearing member default protection. The default insurance was renewed in September 2022 and has a three-year term for the following clearing houses in the following amounts: ICE Clear Europe - $100 million; ICE Clear U.S. - $25 million; and ICE Clear Credit - $75 million. The default insurance layer resides after and in addition to the ICE Clear Europe, ICE Clear U.S. and ICE Clear Credit SITG contributions and before the guaranty fund contributions of the non-defaulting Members.

Similar to SITG, the default insurance layer is not intended to replace or reduce the position risk-based amount of the guaranty fund. As a result, the default insurance layer is not a factor that is included in the calculation of the Members' guaranty fund contribution requirement. Instead, it serves as an additional, distinct, and separate default resource that should serve to further protect the non-defaulting Members’ guaranty fund contributions from being mutualized in the event of a default.

As of June 30, 2023, ICE NGX maintained a guaranty fund of $215 million, comprised of $15 million in cash and a $200 million letter of credit backed by a default insurance policy of the same amount, discussed below.

Below is a depiction of our Default Waterfall which summarizes the lines of defense and layers of protection we maintain for our mutualized clearing houses.

ICE Clearing House Default Waterfall

ICE Risk Waterfall graphic for clearing FN.jpg

Cash and Invested Margin Deposits

We have recorded cash and invested margin and guaranty fund deposits and amounts due in our balance sheets as current assets with corresponding current liabilities to the Members. As of June 30, 2023, our cash and invested margin deposits were as follows (in millions):


	ICE Clear Europe (1)		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Other ICE Clearing Houses		Total
Original margin	$	45,464	$	29,056	$	4,968	$	—	$	5	$	79,493
Unsettled variation margin, net	—		—		—		693		—		693
Guaranty fund	3,886		3,197		646		—		4		7,733
Delivery contracts receivable/payable, net	—		—		—		410		—		410
Total	$	49,350	$	32,253	$	5,614	$	1,103	$	9	$	88,329

As of December 31, 2022, our cash and invested margin deposits were as follows (in millions):


	ICE Clear Europe (2)		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Other ICE Clearing Houses		Total
Original margin	$	101,243	$	31,277	$	4,141	$	—	$	5	$	136,666
Unsettled variation margin, net	—		—		—		749		—		749
Guaranty fund	4,162		3,177		597		—		4		7,940
Delivery contracts receivable/payable, net	—		—		—		2,017		—		2,017
Total	$	105,405	$	34,454	$	4,738	$	2,766	$	9	$	147,372

(1) $44.7 billion and $4.6 billion is related to futures/options and CDS, respectively.

(2) $97.6 billion and $7.8 billion is related to futures/options and CDS, respectively.

Our cash and invested margin and guaranty fund deposits are maintained in accounts with national banks and highly-rated financial institutions or secured through direct investments, primarily in U.S. Treasury and other highly-rated foreign government securities, or reverse repurchase agreements with primarily overnight maturities. We primarily use Level 1

inputs when evaluating the fair value of the non-cash equivalent direct investments, as highly-rated government securities are quoted in active markets. The carrying value of these deposits is deemed to approximate fair value.

To provide a tool to address the liquidity needs of our clearing houses and manage the liquidation of margin and guaranty fund deposits held in the form of cash and high quality sovereign debt, ICE Clear Europe, ICE Clear Credit and ICE Clear U.S. have entered into Committed Repurchase Agreement Facilities, or Committed Repo. Additionally, ICE Clear Credit and ICE Clear Netherlands have entered into Committed FX Facilities to support these liquidity needs. As of June 30, 2023, the following facilities were in place:

ICE Clear Europe: $1.0 billion in Committed Repo to finance U.S. dollar, euro and pound sterling deposits.
ICE Clear Credit: $300 million in Committed Repo (U.S. dollar based) to finance U.S. dollar denominated sovereign debt and euro deposits, €250 million in Committed Repo (euro based) to finance euro and U.S. dollar denominated sovereign debt deposits, and €1.9 billion in Committed FX Facilities to finance euro payment obligations.
ICE Clear U.S.: $250 million in Committed Repo to finance U.S. dollar denominated sovereign debt deposits.
ICE Clear Netherlands: €10 million in Committed FX Facilities to finance euro payment obligations.

Details of our deposits are as follows (in millions):


Cash and Cash Equivalent Margin Deposits and Guaranty Funds
Clearing House	Investment Type	As of June 30, 2023		As of December 31, 2022
ICE Clear Europe	National bank account (1)	$	5,932	$	17,390
ICE Clear Europe	Reverse repo	41,300		65,352
ICE Clear Europe	Sovereign debt	1,791		19,894
ICE Clear Europe	Demand deposits	16		153
ICE Clear Credit	National bank account	24,910		27,145
ICE Clear Credit	Reverse repo	4,310		3,916
ICE Clear Credit	Demand deposits	3,034		3,393
ICE Clear U.S.	Reverse repo	5,465		4,266
ICE Clear U.S.	Sovereign Debt	149		472
Other ICE Clearing Houses	Demand deposits	10		9

Total cash and cash equivalent margin deposits and guaranty funds		$	86,917	$	141,990


Invested Deposits, Delivery Contracts Receivable and Unsettled Variation Margin
Clearing House	Investment Type	As of June 30, 2023		As of December 31, 2022
ICE NGX	Unsettled variation margin and delivery contracts receivable/payable	1,103		2,766
ICE Clear Europe	Invested deposits - sovereign debt	309		2,616
Total invested deposits, delivery contracts receivable and unsettled variation margin		$	1,412	$	5,382

(1) As of June 30, 2023, ICE Clear Europe held €58 million ($63 million based on the euro/U.S. dollar exchange rate of 1.0911 as of June 30, 2023) at the European Central Bank, or ECB, £4.6 billion ($5.9 billion based on the pound sterling/U.S. dollar exchange rate of 1.2697 as of June 30, 2023) at the Bank of England, or BOE, and €10 million ($11 million based on the above exchange rate) at the BOE. As of December 31, 2022, ICE Clear Europe held €11.7 billion ($12.5 billion based on the euro/U.S. dollar exchange rate of 1.0704 as of December 31, 2022) at ECB, £4.0 billion ($4.9 billion based on the pound sterling/U.S. dollar exchange rate of 1.2093 as of December 31, 2022) at the BOE and €10 million ($11 million based on the above exchange rate) at the BOE.

Other Deposits

Non-cash original margin and guaranty fund deposits are not reflected in the accompanying consolidated balance sheets as the risks and rewards of these assets remain with the clearing members unless the clearing houses have sold or re-pledged the assets or in the event of a clearing member default, where the clearing member is no longer entitled to redeem the assets. Any income, gain or loss accrues to the clearing members.

In addition to the cash and invested deposits above, the ICE Clearing Houses have also received other assets from Members, which include government obligations, emissions allowances, and may include other non-cash collateral such

as letters of credit at ICE NGX to mitigate credit risk. For certain deposits, we may impose discount or “haircut” rates to ensure adequate collateral if market values fluctuate. The value-related risks and rewards of these assets remain with the Members. Any gain or loss accrues to the Member. The ICE Clearing Houses do not, in the ordinary course, rehypothecate or re-pledge these assets. These pledged assets are not reflected in our balance sheets, and are as follows (in millions):


	As of June 30, 2023
	ICE Clear Europe		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Total
Original margin:
Government securities at face value	$	53,228	$	31,705	$	12,920	$	—	$	97,853
Letters of credit and other	237		—		—		4,326		4,563
ICE NGX cash deposits	—		—		—		1,349		1,349
Total	$	53,465	$	31,705	$	12,920	$	5,675	$	103,765
Guaranty fund:
Government securities at face value	$	765	$	846	$	289	$	—	$	1,900


	As of December 31, 2022
	ICE Clear Europe		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Total
Original margin:
Government securities at face value	$	74,964	$	26,601	$	14,855	$	—	$	116,420
Letters of credit	—		—		—		5,434		5,434
ICE NGX cash deposits	—		—		—		2,357		2,357
Total	$	74,964	$	26,601	$	14,855	$	7,791	$	124,211
Guaranty fund:
Government securities at face value	$	641	$	805	$	269	$	—	$	1,715

The ICE Clearing Houses invest cash margin deposits, including both the guaranty fund and original margin deposits on behalf of clearing members, primarily for purposes of safeguarding customer funds. Interest earned on cash margin investments is provided back to clearing members net of certain costs and administrative fees charged and retained by ICE. The ICE Clearing Houses also charge fees for clearing members pledging non-cash margin in lieu of cash margin, these fees are fully retained by ICE. The net interest income on cash margin and fees charged for non-cash margin retained by the ICE Clearing Houses is recorded in our Exchanges segment as OTC and other revenues and in our Fixed Income and Data Services segment as CDS clearing revenues in our consolidated statement of income. We recognized a combined $191 million and $139 million as our revenues during the six months ended June 30, 2023 and 2022, respectively, and $91 million and $81 million as our revenues during the three months ended June 30, 2023 and 2022, respectively.

ICE NGX

ICE NGX owns a clearing house which primarily administers the physical delivery of energy trading contracts. ICE NGX is the central counterparty to Members on opposite sides of its physically-settled contracts, and the balance related to delivered but unpaid contracts is recorded as a delivery contract net receivable, with an offsetting delivery contract net payable in our balance sheets. Unsettled variation margin equal to the fair value of open contracts is recorded as of each balance sheet date. There is no impact on our consolidated statements of income as an equal amount is recognized as both an asset and a liability. ICE NGX marks all its outstanding physical natural gas and physical power contracts to market daily, but only collects variation margin when a Member's open position falls outside a specified percentage of its pledged collateral. Due to the highly liquid nature and the short period of time to maturity, the fair values of our delivery contract net payable and net receivable are determined to approximate carrying value.

ICE NGX requires Members to maintain cash or letters of credit to serve as collateral in the event of default. The cash is maintained in a segregated bank account for the benefit of the Member, and remains the property of the Member, therefore, it is not included in our balance sheets. ICE NGX maintains a committed daylight-overnight liquidity facility in the amount of $100 million with an additional $200 million uncommitted with a third-party Canadian chartered bank which provides liquidity in the event of a settlement shortfall, subject to certain conditions.

As of June 30, 2023, ICE NGX maintains a guaranty fund of $215 million funded by a $200 million letter of credit issued by a major Canadian chartered bank, and backed by default insurance underwritten by Export Development Canada, or

EDC, a Crown corporation operated at arm’s length from the Canadian government, plus $15 million held as restricted cash to fund the first loss amount that ICE NGX is responsible for under the default insurance policy. In the event of a participant default where the Member’s collateral is depleted, the shortfall would be covered by a draw down on the letter of credit following which ICE NGX would file a claim under the default insurance to recover additional losses up to $200 million beyond the $15 million first-loss amount that ICE NGX is responsible for under the default insurance policy.

Clearing House Exposure

The net notional value of unsettled contracts was $2.4 trillion as of June 30, 2023. Each ICE Clearing House bears financial counterparty credit risk and provides a central counterparty guarantee, or performance guarantee, to its Members. To reduce their exposure, the ICE Clearing Houses have a risk management program with both initial and ongoing membership standards. Excluding the effects of original and variation margin, guaranty fund and collateral requirements and default insurance, the ICE Clearing Houses’ maximum estimated exposure for this guarantee is $161.8 billion as of June 30, 2023, which represents the maximum estimated value by the ICE Clearing Houses of a hypothetical one-day movement in pricing of the underlying unsettled contracts. This value was determined using proprietary risk management software that simulates gains and losses based on historical market prices, volatility and other factors present at that point in time for those particular unsettled contracts. Future market price volatility could result in the exposure being significantly different than this amount.

13. Legal Proceedings

In the ordinary course of our business, from time to time we are subject to legal proceedings, lawsuits, government investigations and other claims with respect to a variety of matters. In addition, we are subject to periodic reviews, inspections, examinations and investigations by regulators in the U.S. and other jurisdictions, any of which may result in claims, legal proceedings, assessments, fines, penalties, restrictions on our business or other sanctions. We record estimated expenses and reserves for legal or regulatory matters or other claims when these matters present loss contingencies that are probable and the related amount is reasonably estimable. Any such accruals may be adjusted as circumstances change. Assessments of losses are inherently subjective and involve unpredictable factors. While the outcome of legal and regulatory matters is inherently difficult to predict and/or the range of loss often cannot be reasonably estimable, we do not believe that the liabilities, other than the potential $725 million termination fee payable to Black Knight and our accruals related to potential regulatory settlements of $11 million, which may ultimately result from the resolution of the various legal and regulatory matters that arise in the ordinary course of our business, including the matter described below and those described in Note 16 to the consolidated financial statements in Part II, Item 8 of our 2022 Form 10-K, are likely to have a material adverse effect on our consolidated financial condition, results of operations, or liquidity. It is possible, however, that future results of operations for any particular quarterly or annual period could be materially and adversely affected by any developments relating to these legal and regulatory matters. A range of possible losses related to certain cases cannot be reasonably estimated at this time, except as otherwise disclosed below and in Note 16 to the consolidated financial statements in Part II, Item 8 of our 2022 Form 10-K. Individual matter disclosures in this Form 10-Q are limited to new significant matters or significant updates on existing matters since the 2022 Form 10-K.

Black Knight Transaction Litigation

On March 9, 2023, the Federal Trade Commission, or the FTC, filed an administrative complaint alleging that the proposed transaction between ICE and Black Knight, if consummated, would be an unfair method of competition in violation of Section 5 of the Federal Trade Commission Act, and that it would substantially lessen competition, or tend to create a monopoly, in violation of Section 7 of the Clayton Act. The complaint seeks a variety of injunctive relief, including, among other things, a prohibition on the completion of the transaction without the FTC’s consent and, if the transaction is completed, a divestiture or reconstitution of assets in a manner that restores such separate and independent businesses as the parties had operated prior to the completion of the transaction. On April 10, 2023, the FTC filed a complaint in the United States District Court for the Northern District of California for a temporary restraining order and preliminary injunction enjoining the completion of the transaction. On April 21, 2023, the court entered a temporary restraining order enjoining the completion of the transaction until the court rules on the FTC’s motion for a preliminary injunction. In their answers to the administrative and court complaints, filed on March 20, 2023 and April 25, 2023, respectively, ICE and Black Knight denied the FTC’s substantive allegations; asserted numerous affirmative defenses; described the pro-competitive aspects and significant lender, servicer, investor, vendor and consumer benefits relating to this transaction; and denied that the combination of their respective businesses would violate any laws. Additionally, the answers to the court complaint contained counterclaims by ICE and Black Knight against the FTC seeking declaratory relief that the FTC’s administrative process is unconstitutional and should be enjoined. On July 17, 2023, the district court entered an order granting a joint motion by the parties to continue the evidentiary hearing on the FTC's motion for a preliminary injunction, and rescheduled the hearing to August 14, 2023. In continuing the hearing, the court noted that the parties are discussing a potential resolution of the matter resulting from the announcement of the planned divestiture of the Optimal

Blue business (see Note 3) and the FTC’s analysis of the implications of the divestiture for this case and the administrative complaint. On July 19, 2023, FTC counsel filed an unopposed motion with the FTC to withdraw the administrative complaint from adjudication; on July 25, 2023, the FTC granted this motion. We are vigorously defending against the FTC’s court complaint.

For further information on our legal and regulatory matters, please see Note 16 to the consolidated financial statements in Part II, Item 8 of our 2022 Form 10-K.

14. Fair Value Measurements

Fair value is the price that would be received from selling an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Our financial instruments consist primarily of certain short-term and long-term assets and liabilities, customer accounts receivable, margin deposits and guaranty funds, equity and equity method investments, and short-term and long-term debt.

The fair value of our financial instruments is measured based on a three-level hierarchy:

Level 1 inputs** — quoted prices for identical assets or liabilities in active markets.
Level 2 inputs** — observable inputs other than Level 1 inputs such as quoted prices for similar assets and liabilities in active markets or inputs other than quoted prices that are directly observable.
Level 3 inputs** — unobservable inputs supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

Financial assets and liabilities recorded or disclosed at fair value in the accompanying consolidated balance sheets as of June 30, 2023 and December 31, 2022 were classified in their entirety based on the lowest level of input that is significant to the asset or liability’s fair value measurement.

Our restricted short-term and long-term investments represent restricted regulatory funds and SITG funds, respectively, at ICE Clear Europe, invested in treasury securities with maturities of greater than 90 days.

Our mutual funds are equity and fixed income mutual funds held for the purpose of providing future payments for our supplemental executive savings plan and the supplemental executive retirement plan. These mutual funds are classified as equity investments and measured at fair value using Level 1 inputs with adjustments recorded in net income.

Excluding our equity investments without a readily determinable fair value, all other financial instruments are determined to approximate carrying value due to the short period of time to their maturities.

We did not use Level 3 inputs to determine the fair value of assets or liabilities measured at fair value on a recurring basis as of June 30, 2023 or December 31, 2022.

We measure certain assets, such as intangible assets and equity method investments, at fair value on a non-recurring basis. These assets are recognized at fair value if they are deemed to be impaired. As of December 31, 2022, certain equity method investments were measured at fair value on a non-recurring basis. As of June 30, 2023, none of our intangible assets or equity method investments were required to be recorded at fair value since no impairments were recorded.

We measure certain equity investments at fair value on a non-recurring basis using our policy election under ASU 2016-01*.* During the six months ended June 30, 2023, we evaluated these investments and determined that no fair value adjustments were required under our accounting policy election related to these investments.

See Note 12 for the fair value considerations related to our margin deposits, guaranty funds and delivery contracts receivable.

The table below displays the fair value of our debt as of June 30, 2023. The fair values of our fixed rate notes were estimated using quoted market prices for these instruments. The fair value of other short-term debt approximates par value since the interest rates on this short-term debt approximate market rates as of June 30, 2023.


	As of June 30, 2023
	(in millions)
Debt:	Carrying Amount		Fair value







3.65% Senior Notes due May 23, 2025	$	1,245	$	1,226
3.75% Senior Notes due December 1, 2025	1,248		1,214
4.00% Senior Notes due September 15, 2027	1,488		1,463
3.10% Senior Notes due September 15, 2027	498		468
3.75% Senior Notes due September 21, 2028	595		571
4.35% Senior Notes due June 15, 2029	1,240		1,225
2.10% Senior Notes due June 15, 2030	1,237		1,046
1.85% Senior Notes due September 15, 2032	1,485		1,157
4.60% Senior Notes due March 15, 2033	1,488		1,455
2.65% Senior Notes due September 15, 2040	1,232		892
4.25% Senior Notes due September 21, 2048	1,232		1,091
3.00% Senior Notes due June 15, 2050	1,221		871
4.95% Senior Notes due June 15, 2052	1,465		1,435
3.00% Senior Notes due September 15, 2060	1,471		985
5.20% Senior Notes due June 15, 2062	983		996
Total debt	$	18,128	$	16,095

15. Segment Reporting

Our business is conducted through three reportable business segments:

Exchanges:** We operate regulated marketplaces for the listing, trading and clearing of a broad array of derivatives contracts and financial securities;
Fixed Income and Data Services:** We provide fixed income pricing, reference data, indices, analytics and execution services as well as global CDS clearing and multi-asset class data delivery solutions; and
Mortgage Technology:** We provide a technology platform that offers customers comprehensive, digital workflow tools that aim to address the inefficiencies that exist in the U.S. residential mortgage market, from application through closing and the secondary market.

While revenues are recorded specifically in the segment in which they are earned or to which they relate, a significant portion of our operating expenses are not solely related to a specific segment because the expenses serve functions that are necessary for the operation of more than one segment. We directly allocate expenses when reasonably possible to do so. Otherwise, we use a pro-rata revenue approach as the allocation method for the expenses that do not relate solely to one segment and serve functions that are necessary for the operation of all segments.

Our chief operating decision maker does not review total assets or statements of income below operating income by segments; therefore, such information is not presented below. Our three segments do not engage in intersegment transactions.

Beginning in the first quarter of 2023, closing solutions revenues within our Mortgage Technology segment now include membership dues that were previously included in other revenues. We believe this is a more accurate reflection of the nature of these revenues. The impact of this change was not material, and the prior year periods have been adjusted for comparability.

Financial data for our business segments is as follows for the six months and three months ended June 30, 2023 and 2022 (in millions):


	Six Months Ended June 30, 2023
	Exchanges		Fixed Income and Data Services		Mortgage Technology		Consolidated
Revenues:
Energy futures and options	$	700	$	—	$	—	$	700
Agricultural and metals futures and options	147		—		—		147
Financial futures and options	232		—		—		232
Cash equities and equity options	1,215		—		—		1,215
OTC and other	205		—		—		205
Data and connectivity services	463		—		—		463
Listings	252		—		—		252
Fixed income execution	—		60		—		60
CDS clearing	—		185		—		185
Fixed income data and analytics	—		553		—		553
Other data and network services	—		311		—		311
Origination technology	—		—		337		337
Closing solutions	—		—		87		87
Data and analytics	—		—		45		45
Other	—		—		16		16
Revenues	3,214		1,109		485		4,808
Transaction-based expenses	1,024		—		—		1,024
Revenues, less transaction-based expenses	2,190		1,109		485		3,784
Operating expenses	631		699		530		1,860
Operating income/(loss)	$	1,559	$	410	$	(45)	$	1,924


	Three Months Ended June 30, 2023
	Exchanges		Fixed Income and Data Services		Mortgage Technology		Consolidated
Revenues:
Energy futures and options	$	355	$	—	$	—	$	355
Agricultural and metals futures and options	77		—		—		77
Financial futures and options	104		—		—		104
Cash equities and equity options	544		—		—		544
OTC and other	104		—		—		104
Data and connectivity services	231		—		—		231
Listings	126		—		—		126
Fixed income execution	—		28		—		28
CDS clearing	—		84		—		84
Fixed income data and analytics	—		277		—		277
Other data and network services	—		157		—		157
Origination technology	—		—		170		170
Closing solutions	—		—		47		47
Data and analytics	—		—		24		24
Other	—		—		8		8
Revenues	1,541		546		249		2,336
Transaction-based expenses	448		—		—		448
Revenues, less transaction-based expenses	1,093		546		249		1,888
Operating expenses	311		356		266		933
Operating income/(loss)	$	782	$	190	$	(17)	$	955


	Six Months Ended June 30, 2022
	Exchanges		Fixed Income and Data Services		Mortgage Technology		Consolidated
Revenues:
Energy futures and options	$	618	$	—	$	—	$	618
Agricultural and metals futures and options	122		—		—		122
Financial futures and options	253		—		—		253
Cash equities and equity options	1,357		—		—		1,357
OTC and other	205		—		—		205
Data and connectivity services	432		—		—		432
Listings	260		—		—		260
Fixed income execution	—		40		—		40
CDS clearing	—		138		—		138
Fixed income data and analytics	—		551		—		551
Other data and network services	—		292		—		292
Origination technology	—		—		399		399
Closing solutions	—		—		138		138
Data and analytics	—		—		44		44
Other	—		—		23		23
Revenues	3,247		1,021		604		4,872
Transaction-based expenses	1,159		—		—		1,159
Revenues, less transaction-based expenses	2,088		1,021		604		3,713
Operating expenses	603		692		557		1,852
Operating income	$	1,485	$	329	$	47	$	1,861


	Three Months Ended June 30, 2022
	Exchanges		Fixed Income and Data Services		Mortgage Technology		Consolidated
Revenues:
Energy futures and options	$	265	$	—	$	—	$	265
Agricultural and metals futures and options	61		—		—		61
Financial futures and options	123		—		—		123
Cash equities and equity options	698		—		—		698
OTC and other	108		—		—		108
Data and connectivity services	218		—		—		218
Listings	131		—		—		131
Fixed income execution	—		25		—		25
CDS clearing	—		66		—		66
Fixed income data and analytics	—		274		—		274
Other data and network services	—		147		—		147
Origination technology	—		—		196		196
Closing solutions	—		—		66		66
Data and analytics	—		—		24		24
Other	—		—		11		11
Revenues	1,604		512		297		2,413
Transaction-based expenses	599		—		—		599
Revenues, less transaction-based expenses	1,005		512		297		1,814
Operating expenses	304		338		303		945
Operating income/(loss)	$	701	$	174	$	(6)	$	869

Revenue from one member of the Exchanges segment comprised $254 million, or 12%, and $130 million, or 12%, of our Exchange revenues, less transaction-based expenses for the six months and three months ended June 30, 2023, respectively. Revenue from one member of the Exchanges segment comprised $213 million, or 10%, of our Exchange

revenues, less transaction-based expenses for the six months ended June 30, 2022 and no customers or clearing members accounted for more than 10% of our Exchange revenues, less transaction-based expenses during the three months ended June 30, 2022. Clearing members are primarily intermediaries and represent a broad range of principal trading firms. If a clearing member ceased its operations, we believe that the trading firms would continue to conduct transactions and would clear those transactions through another clearing member firm. No additional customers or clearing members accounted for more than 10% of our segment revenues or consolidated revenues during the six months or three months ended June 30, 2023 or 2022.

16. Earnings Per Common Share

The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per common share computations for the six months and three months ended June 30, 2023 and 2022 (in millions, except per share amounts):


	Six Months Ended June 30,					Three Months Ended June 30,
2023			2022	2023				2022
Basic:
Net income attributable to Intercontinental Exchange, Inc.	$	1,454		$	1,212	$	799		$	555
Weighted average common shares outstanding	560			560		560			558
Basic earnings per common share	$	2.60		$	2.17	$	1.43		$	0.99
Diluted:
Weighted average common shares outstanding	560			560		560			558
Effect of dilutive securities - stock options and restricted stock	1			2		1			2
Diluted weighted average common shares outstanding	561			562		561			560
Diluted earnings per common share	$	2.59		$	2.16	$	1.42		$	0.99

Basic earnings per common share is calculated using the weighted average common shares outstanding during the period.

Common equivalent shares from stock options and restricted stock awards, calculated using the treasury stock method, are included in the diluted per share calculations unless the effect of their inclusion would be antidilutive. During both the six months ended June 30, 2023 and 2022, 1 million outstanding stock options and restricted stock awards were not included in the computation of diluted earnings per common share, because to do so would have had an antidilutive effect.

17. Subsequent Events

We have evaluated subsequent events, and determined that no events or transactions, other than those already disclosed in this Quarterly Report, met the definition of a subsequent event for purposes of recognition or disclosure in the accompanying consolidated financial statements.

Previous: Cover and table of contents · Next: Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS