Nasdaq Delved Into: Background, Trading Procedure, and Monetary Perspectives
Nasdaq: A Diversified Revenue Powerhouse
The Nasdaq, a U.S. stock exchange based in New York City, officially opened its doors in February 1971 and has since become a global powerhouse in the financial world. This exchange is renowned for its large-cap growth index, the Nasdaq 100, which comprises 100 of the largest U.S. and international non-financial companies listed on the Nasdaq stock exchange.
Nasdaq generates revenue from a variety of sources, with its main streams being exchange market services, financial technology solutions, and index licensing fees.
Exchange Market Services
This revenue source stems from trading activity on Nasdaq’s U.S. stock and derivatives exchanges. Fees from buying and selling equities, options, and derivatives contribute significantly to this income. In Q2 2025, Nasdaq’s Market Services earned a record $306 million, driven by high cash equities and derivatives volumes.
Financial Technology Solutions
Nasdaq provides technology solutions to financial institutions, including risk management, compliance, and trading systems. This segment reported $464 million in revenue in Q2 2025, showing strong growth driven by new client acquisitions and upsells. Subscription-based SaaS offerings form a substantial portion of this recurring revenue stream, reflecting Nasdaq’s shift towards predictable, technology-driven income.
Index Licensing Fees
Nasdaq generates revenue from licensing its indices to asset managers and ETF providers. Fees are typically charged as a percentage of assets under management (AUM) linked to Nasdaq-branded indices, making this a recurring income source that grows with AUM.
In addition to these core segments, Nasdaq also generates revenue from event production (virtual, hybrid, physical), although this contributes modestly compared to the other segments.
As of June 30, 2023, Apple stock closed at $190.25, trading on the Nasdaq under the ticker symbol AAPL. In the 2022 fiscal year ending Dec. 31, 2022, Nasdaq reported total net income of $1.12 billion on total revenue of $6.23 billion. Revenue minus transaction-based expenses was $3.58 billion.
Notable events in Nasdaq's history include the dot-com boom and bust, where the Nasdaq Composite rallied nearly 150% in 16 months through March 2000 and slumped almost 80% by October 2002. In 2016, Adena Friedman was promoted to the role of CEO, becoming the first woman to run a major exchange in the United States. In December 2020, Nasdaq proposed a new rule requiring companies listed on the exchange to report on the diversity of their board of directors.
The Nasdaq consists of three tiers: the Nasdaq Global Select Market, the Nasdaq Global Market, and the Nasdaq Capital Market.
- In addition to traditional stocks and derivatives, the Nasdaq market services are now seeing growth in the crypto market with the trading of various tokens.
- The technology segment of Nasdaq has expanded its services to include Initial Coin Offerings (ICO), aiming to provide a secure and regulated trading environment for new digital asset projects.
- Market analysts suggest that the market cap of cryptocurrencies could potentially contribute a significant portion to Nasdaq's revenue in the coming years, reshaping the business landscape.
- As Nasdaq continues to diversify its offerings, strategic partnerships with finance and technology-focused businesses will be crucial in maintaining its status as a global powerhouse.
