Miami International Holdings (MIAX) Q3 2026 earnings review
MIAX cuts costs and lifts profit, but trade pricing falls
Miami International Holdings, an operator of options, futures and stock exchanges, expanded its profit margins through fixed connection fees and cost cuts even as per-trade options pricing dropped. Net revenue grew 20% from a year ago to $131 million, while profit per share excluding one-offs rose 7% to $0.45 because post-offering share dilution absorbed most of the earnings growth. Chief executive Thomas P. Gallagher lowered the full-year operating expense plan, though by our math the new target still points to a 9% spending increase in the fourth quarter.
| Net revenue | $131.0M +20% from a year ago |
|---|---|
| EBITDA margin, excluding one-offs | 54% 44% a year ago |
| Options revenue per contract | $0.098 -21% from last quarter |
| Full-year operating expense plan | Lowered $9.5M middle of the range: $255.5M |
⚖️ Verdict: ⚪ Neutral
The story is unchanged because strong growth in recurring network fees and lower operating expenses balanced out weaker pricing in options and a slow start in financial futures. The bad news: reclaiming a 17.4% options market share pushed per-contract pricing down to $0.098, missing management's second-half outlook, while daily volume in the new Bloomberg index futures fell by two-thirds from the second quarter at negative pricing.
The question now is whether the exchange operator can grow its Bloomberg futures and hold above 17% options market share without giving away its fee rate in rebates. Either retail connections lift futures volume enough to end the subsidies and recurring access fees carry the margin, or rebate costs keep climbing across both divisions. Fourth-quarter options revenue per contract and financial futures volume will tell.
🐂 Bull Case
Fixed Fees and Lower Costs Lifted the Margin
Chief executive Thomas P. Gallagher credited the exchange operator's "lean, high-margin operating model" for expanding its profit margin. Miami International Holdings charges trading firms monthly fees for network connections and market data alongside per-trade fees. Those recurring fees grew 34.4% from a year ago to $50.8 million by our math, driven by "increased member connections, and 2026 fee increases".
- Access and market data fees: 38.8% of net revenue, up from 34.5% a year ago by our math
- Operating expenses excluding one-offs: $60.3 million, down 2.2% from a year ago and down 10.3 percentage points of net revenue by our math
- Employee pay and benefits: 30.8% of net revenue, down 32.0 percentage points after last year's initial public offering bonuses lapsed
Because connection fees do not depend on daily trading swings and operating costs fell below last year's level, earnings before interest, taxes, depreciation and amortization (EBITDA), excluding one-offs, rose 47% to $70.8 million, or 54% of net revenue. Management also lowered its full-year operating expense plan by $9.5 million at the middle of the range.
What to watch: fourth-quarter operating expenses excluding one-offs, which the full-year plan puts at $67.9 million by our math. Holding spending below that figure would show that third-quarter cost savings are permanent rather than delayed marketing bills.
Agricultural Futures and International Listings Grew
Outside US options, the company runs agricultural futures exchanges and international stock exchanges in Bermuda and the Channel Islands. After agricultural trading volume fell by nearly a third in the first half of 2026 following a technology platform switch, volume rebounded in the third quarter. The company also added "four fertilizer futures contracts recently launched in response to clear member interest", Gallagher said.
Agricultural average daily volume rose 42.5% from a year ago to 11,428 contracts, while the International division's net revenue grew 11.0% to $6.1 million on "increased total listed securities" at The International Stock Exchange Group (TISE), which reached 6,092 listings. International EBITDA excluding one-offs rose 30.1% to $2.3 million, lifting its margin to 36.7% now that the June 2025 acquisition is in the prior-year base.
What to watch: fourth-quarter agricultural futures average daily volume against last year's 8,188 contracts. A second straight quarter of growth above 11,000 contracts would confirm that traders have returned after last year's platform migration.
Positives this quarter didn't test
Two standing positives from earlier in the year received no new operating test in the third-quarter release.
- Cash balance: cash and cash equivalents reached $698.9 million against $1.5 million of debt, generating $5.9 million in quarterly interest income while management awaits acquisition or investment targets.
- Perpetual futures licensing: regulatory discussions with US agencies to list perpetual futures contracts were not updated in the release; commentary on today's conference call will show whether a launch timeline exists.
🐻 Bear Case
Reclaiming Options Market Share Cut Pricing Below Plan
Options trading generates 86% of Miami International Holdings' net revenue. Because exchanges pay rebates to market makers to attract order flow, market share and revenue per contract — the net fee the company keeps per trade after rebates — move in opposite directions. After market share slipped for two straight quarters to 16.5% in the second quarter, management adjusted pricing to win back volume.
- Options market share: 17.4%, up from 16.5% in the second quarter and 17.2% a year ago
- Options revenue per contract: $0.098, down 21.0% from $0.124 in the second quarter and below management's $0.103–0.110 second-half outlook
- Options net transaction fees: $69.6 million by our math, down 17.7% from $84.5 million in the second quarter
The company regained its market share, so average daily volume rose 15.2% from a year ago to 11.1 million contracts. But giving up 2.6 cents per contract in pricing cost the options unit nearly $15 million in quarterly transaction fees compared with the second quarter, proving that the exchange operator cannot hold both peak market share and peak pricing at the same time.
What to watch: fourth-quarter options revenue per contract against the $0.103–0.110 second-half target. A second reading below $0.100 would show that defending a 17% market share permanently requires steeper rebates.
Bloomberg Index Futures Volume Dropped Two-Thirds
"Our next growth phase is underway, with Bloomberg index futures now available on NinjaTrader and four fertilizer futures contracts recently launched in response to clear member interest," Gallagher said. The company launched futures on Bloomberg stock indices in May 2026 to challenge incumbent index exchanges, paying rebates to market makers to build early trading activity.
In the first full quarter since launch, financial futures average daily volume fell 66.2% from the second quarter's initial 30-day pace, dropping to 2,683 contracts from 7,949 by our math. Revenue per contract stayed negative at minus $1.428 because the exchange pays out more in liquidity rebates than it collects in fees. Total Futures segment net revenue was $5.0 million, while the segment lost $8.4 million in EBITDA excluding one-offs.
Connecting retail brokerage NinjaTrader did not prevent trading activity from falling after the launch quarter. Because every financial futures trade still loses money and total segment operating expenses of $17.1 million are more than triple segment net revenue, the futures build-out remains a heavy financial drag with shrinking early volume.
What to watch: fourth-quarter financial futures average daily volume and revenue per contract. If daily volume stays below 3,000 contracts despite the NinjaTrader connection, retail traders are not adopting the new index products.
Post-IPO Share Count and Audit Write-Offs
Miami International Holdings went public in August 2025, issuing new stock and converting warrants held by trading firms. In the third quarter of 2026, diluted shares used for earnings excluding one-offs rose 15.3% from a year ago to 110.8 million. That dilution absorbed most of the company's profit growth: earnings excluding one-offs rose 25.3% to $50.1 million, but profit per share rose only 7.1% to $0.45.
Separately, the company recorded a $6.3 million charge in operating expenses for "certain CAT costs that are no longer expected to be recoverable", referring to Consolidated Audit Trail regulatory fees under legal challenge. Management excluded that $6.3 million write-off, along with $7.5 million of employee stock pay, from its $0.45 per-share profit figure.
What to watch: remaining Consolidated Audit Trail notes receivable in the third-quarter filing, which stood at $36.5 million net of allowances last quarter. Further court rulings against regulatory fee recovery would trigger additional write-offs.
Risks this quarter didn't answer
Four standing concerns could not be fully resolved from the third-quarter earnings release.
- No revenue or profit outlook: management guides only expenses, capital spending and tax rates, leaving fourth-quarter revenue expectations unstated.
- Equities market share loss: US equities net revenue rose 53% to $6.7 million as pricing turned positive at $0.011 per 100 shares, but market share fell to 0.7% from 0.9% in the second quarter and 1.1% a year ago as daily volume dropped 41%.
- Customer concentration: three market-making firms generated 43% of revenue in the second quarter; the third-quarter filing will show whether that dependence changed.
- Retail options mix: management has not disclosed the split between retail and institutional options volume across four public quarters.
👓 Other Themes
Pass-Through Fees Inflated Gross Revenue
Total gross revenue grew 10.7% from a year ago to $376.2 million, but $23.0 million of that increase came from Section 31 regulatory fees that the company collects from traders and passes directly to the Securities and Exchange Commission. A year ago, the regulatory rate was zero. Excluding Section 31 fees, gross revenue grew 3.9% by our math, which is why net revenue is the cleaner measure.
💲 Other KPIs
Fell for a second straight quarter, down 2.7% from $9.21 million in June and down 6.4% from $9.57 million at the end of 2025 by our math. Deferred transaction revenues are upfront fees collected from customers for trading services not yet delivered, providing a small read on unearned revenue.
Rose 53.0% from a year ago and 20.2% from the second quarter. The US stock exchange unit stopped paying net subsidies to traders, capturing $0.011 per 100 shares traded compared with minus $0.015 a year ago. That pricing shift turned segment EBITDA excluding one-offs positive at $1.0 million, versus a $0.9 million loss a year ago.
Swung to a $9.8 million non-operating gain in the third quarter, after recording mark-to-market losses of $0.3 million in the second quarter and $2.5 million in the first quarter. The gain reflects the market value of unlocked Pyth network digital tokens and 125 million locked tokens held by the company's Bermuda exchange, and is excluded from adjusted earnings.
🔮 Guidance
Lowered. Management cut its full-year spending plan by $9.5 million at the middle of the range, to a 9.4% increase from 2025 by our math. It is the second straight cost reduction after holding the range in the first quarter: $0M, -$5.0M, -$9.5M. By our math, the plan leaves $67.9 million of spending for the fourth quarter, up 8.7% from a year ago.
Raised at the bottom end. The middle of the employee stock pay range moved up $0.5 million to $31.0 million, following a $2.0 million increase last quarter: $0M, +$2.0M, +$0.5M. With $23.5 million recorded in the first nine months, the plan leaves $7.5 million for the fourth quarter by our math, down 21.6% from a year ago.
Raised. Management lifted its capital spending and software development budget by $2.0 million at the middle of the range to $44.5 million, or 27.1% above 2025 levels by our math, after holding the target at $40–45 million for two straight quarters.
Narrowed. The middle of the range stayed at $37.0 million, up 25.9% from 2025 as the new Miami trading floor and futures trading platform depreciate. After $26.3 million in the first nine months, the plan implies $10.7 million of expense in the fourth quarter by our math, up 32.8% from a year ago.
Lowered. The company trimmed its expected full-year tax rate by 1 percentage point at both ends of the range to 27.0% at the middle, after holding the range at 27–29% for the first two quarters of the year.
❓ Key Questions
Why did Bloomberg futures volume drop two-thirds in Q3?
Financial futures average daily volume fell to 2,683 contracts from 7,949 in the second quarter despite connecting retail brokerage NinjaTrader. Management has not disclosed how much volume comes from retail traders versus subsidized market makers.
What kept Q3 operating expenses $8M below the implied run-rate?
Operating expenses excluding one-offs fell 2% from a year ago to $60.3 million, well below the $66–71 million quarterly pace the prior outlook implied. Did the company delay marketing and liquidity incentives for Bloomberg futures into the fourth quarter?
Will defending 17.4% options share keep pricing below $0.100?
Options revenue per contract dropped 21% from the second quarter to $0.098, missing the $0.103–0.110 second-half target as market share rebounded. Investors need to know if the second-half pricing target still stands.
How much Consolidated Audit Trail receivable remains at risk?
The company wrote off $6.3 million of Consolidated Audit Trail notes receivable in the third quarter as unrecoverable. With $36.5 million net on the books last quarter, how much exposure remains if pending court cases go against the exchanges?