For the remainder of 2025 I see compelling opportunities in both Intercontinental Exchange (ICE) and CME Group. The key differentiator between these two financial infrastructure giants lies in their business models and revenue durability.
Intercontinental Exchange (ICE) stands out for its diversified, recurring revenue streams. In Q1 2025, ICE reported record net revenues of $2.5 billion, up 8% year-over-year, with adjusted diluted EPS of $1.72. The company’s robust growth is underpinned by its data services and mortgage technology segments, which provide stable, subscription-based income. Data services alone have delivered 43 consecutive quarters of growth, while ICE Mortgage Technology posted a 98% year-over-year jump in adjusted operating income in Q4 2023. This balance of recurring and transactional revenue—approximately 55% from exchanges, 28% from fixed income and data services, and 17% from mortgage technology—offers resilience against market volatility. ICE’s net margin for 2024 was an impressive 44.26%, reflecting strong operational efficiency.
CME Group offers a more concentrated, trading-driven model. In Q1 2025, CME delivered record revenue of $1.64 billion (up 10% year-over-year) and adjusted EPS of $2.80, beating expectations. Over 80% of CME’s revenue comes from clearing and transaction fees, with a gross profit margin of 100%—a testament to its operational leverage and pricing power in derivatives markets. The company benefits from increased trading volumes, particularly in commodities, currencies, and energy—essential goods that will remain in high demand.
To recap, for investors seeking stability, ICE’s recurring revenue and diversified model present a lower-risk profile. For those comfortable with market volatility and cyclicality, CME’s pure-play on trading and clearing offers higher-margin, volume-driven upside. Both companies, however, demonstrate strong profitability, robust margins, and leadership in their respective niches, making them attractive for a well-balanced portfolio.
