CME Group’s latest filing reveals a widening gap between its top-line growth and the cash it retains. Revenue for the twelve months to Q3 2026 reached $6.97 billion, a 9.0% increase from the prior year. This growth rate accelerated by 3.9 percentage points compared to the quarter before.
What stands out
Capital spending is consuming a larger share of generated cash. Expenditures rose 21.4% over the period, outpacing the 6.4% growth in operating cash flow. As a result, less of the cash generated by operations remains as free cash flow.
Net income over the twelve months totaled $4.43 billion, marking a 17.0% increase from the previous year. The trailing operating margin stood at 65.7%, up 0.7 percentage points from a year earlier. The trailing net margin was 63.5%.
Cash flow
Operating cash flow over the twelve months was $4.43 billion, up 6.4% on the year before. Capital spending amounted to $93.7 million, representing 1.3% of revenue. Free cash flow, calculated as operating cash flow less capital spending, reached $4.33 billion, a 6.1% increase from the prior year. The free-cash-flow margin was 62.1% of revenue, down 1.7 percentage points from a year earlier. The average diluted share count rose 0.2% over the year.
In context
Current margins sit near the top of the company’s historical range.
What it means for value
Our model shows high sensitivity to growth assumptions. If growth is 5 percentage points lower, the value decreases by 24.2%. If growth is 5 percentage points higher, the value increases by 31.5%.
What to watch
The next filing will show whether the recent acceleration in revenue growth sustains or moderates. Investors should observe if the gap between capital spending and operating cash flow narrows or widens. It will also reveal if the operating margin holds its position at the upper end of the historical range.
