Deutsche Börse Q4 Earnings Call Highlights

Executives at Deutsche Börse (ETR:DB1) used the company’s annual press conference to highlight what they described as a record year of growth, disciplined cost management and a stepped-up approach to returning capital to shareholders, while also outlining a new strategy cycle dubbed “Leading the Transformation.”

Results and key financial themes

Management said the group delivered “the best results” and continued to grow in line with its own forecasts. On an operating basis, Deutsche Börse reported 9% net revenue growth excluding treasury results, which management described as the best indicator of underlying performance because treasury income is highly dependent on interest rates and yield curves.

Net revenue excluding treasury results was cited at EUR 5.2 billion. Treasury results, which the company defined as interest generated on customer balances as well as fees related to collateral in clearing, came in at EUR 837 million versus an expectation of around EUR 0.8 billion, with management noting that declining interest rates were a direct headwind.

On costs, management highlighted 3% operating cost growth, attributing the increase to cost management and the scaling benefits of a platform-driven business model that requires upfront investment. Earnings before interest and taxes (EBIT) were described as rising 14% to EUR 2.7 billion, and the company said cash earnings per share increased by 3%.

Headwinds and structural tailwinds

Executives acknowledged several headwinds during the year, including a moderation in volatility after a strong first quarter, which reduced hedging activity and weighed on parts of the derivatives business. They also pointed to the impact of European Central Bank rate cuts on treasury income. At the same time, management said a stronger U.S. dollar supported results given the group’s growing U.S. footprint.

Despite those factors, executives emphasized what they called “strong structural developments” supporting the business. They pointed to rising retail participation in capital markets across Europe, citing figures that included a record number of shareholders in Germany and growth in ETF adoption and trading activity. Management also pointed to increased outsourcing by financial institutions and continued technology-driven changes as areas where Deutsche Börse expects to benefit.

Segment commentary: IMS, trading/clearing, and post-trade

In Investment Management Solutions (IMS), management highlighted two sub-areas: SimCorp and its index/ESG-related businesses. Executives said SimCorp is expanding, particularly in North America, and referenced a large North American asset manager in the context of commercial momentum.

Within the index and related businesses, management said STOXX revenue rose 10%, driven by demand for European investment products such as ETFs. In contrast, the proxy advisory activity posted more modest growth, which management attributed to regulatory headwinds affecting that business.

Executives also discussed market conditions affecting trading and derivatives, noting that lower volatility reduced hedging needs. They referenced growth areas including energy-related derivatives and highlighted developments at the European Energy Exchange (EEX), including expansion in the U.S. and customer wins, as well as positive developments in Brazil.

In post-trade and fund services, management pointed to strong growth in fund-related services and cited outsourcing trends in asset management as a key driver. They also emphasized the role of the group’s custody and settlement network, describing it as a hub that helps connect fragmented European markets and supports cross-border access through links with central securities depositories.

Capital return: dividend increase and share buyback

Deutsche Börse outlined an enhanced capital return message built around two components: a steadily rising dividend and recurring share buybacks. Management said it proposed increasing the dividend to EUR 4.20 per share, describing the move as a year-on-year increase. Executives also reiterated plans for a EUR 500 million share buyback that had been previously announced at the company’s capital markets day.

Executives said the new approach is to make buybacks a continuing element of capital returns, with annual volume decisions tied to the company’s investment and acquisition plans. Management also referenced a total payout to shareholders of EUR 1.3 billion, describing it as the largest sum ever.

Outlook, strategy shift, and M&A updates

Looking ahead, management said it confirmed targets under its Horizon 2026 framework and laid out ambitions for the coming year. Executives cited a net revenue target of EUR 6.4 billion, including an expected EUR 700 million treasury result, implying EUR 5.7 billion excluding treasury results and roughly 10% growth on that operating metric. They also reiterated a 3% cost growth assumption and pointed to a profit target of EUR 3.1 billion, while also referencing figures excluding treasury results.

Management framed the next strategic cycle around “Leading the Transformation,” describing it as a response to shifting client needs on the buy side, technology change and what executives characterized as new requirements for Europe’s capital markets. Executives also discussed digital and hybrid infrastructure initiatives, including work related to digital securities and the group’s Crypto Finance platform, and referenced partnerships mentioned in recent announcements.

On transactions, management discussed increasing its stake in ISS STOXX, explaining that an IPO option had been considered but that market conditions did not provide a viable window. Executives said the company chose instead to buy back a stake from General Atlantic as part of previously established agreements and argued that full integration should remove IPO-related costs going forward.

Management also provided an update on its proposed acquisition of Allfunds, describing it as a strategically complementary combination intended to create what executives called a “true investment fund champion.” They said the purchase price was EUR 5.3 billion funded through a mix of cash and debt, and they discussed expected synergies over the coming years, including cost and investment-related synergies tied to integrating technology and investment roadmaps. Executives said the deal remains subject to shareholder and regulatory approvals, with a UK scheme process expected to advance next month and the overall process targeted to conclude by the first half of the following year.

During Q&A, executives addressed share price performance, attributing recent moves largely to shifts in investor risk appetite and sector rotation, while reiterating confidence in the company’s portfolio and ability to meet its ambitions. Management also said it aims to preserve its credit rating and emphasized that ongoing free cash flow generation supports both capital returns and investment capacity.

About Deutsche Börse (ETR:DB1)

Deutsche Börse AG operates as an exchange organization in Europe, America, and the Asia-Pacific. The company operates through four segments: Data & Analytics; Trading & Clearing; Fund Services; and Securities Services. It engages in the trading of derivatives, electricity and gas products, emission rights, foreign exchange, and commodity products; operating EEX and 360T over the counter trading platform for financial instruments, such as foreign exchange, money market, and interest rate products; and operating as a central counterparty.