Miami International Holdings, Inc. 10-Qquarter ended 2026-09-30

Executive Summary

MIAX operates exchanges and clearing and brokerage services for trading firms, earning transaction, access and market-data fees. It is expanding beyond its core options exchanges through Bloomberg-licensed index derivatives, the MIAX Futures Onyx platform and international markets. This quarter, Options drove stronger operating profit, but company-wide revenue growth slowed, Equities lost market share and Futures remained loss-making. The opportunity is to extend its exchange technology into additional markets; investors must distinguish progress in those businesses from tax benefits, asset-sale gains and favorable prior-year comparisons.

What's Happening in the Business

Options strengthened its position through higher trading volumes and market-share gains, although lower revenue per contract tempered growth. Access and market-data fees also increased, adding revenue beyond transaction charges.

MIAX is developing Bloomberg-licensed B500, B100 and B500 Volatility index derivatives alongside agricultural and fertilizer futures. Financial futures launched in May, while investment in Onyx capacity and liquidity incentives continues to weigh on Futures profitability. Agricultural futures’ average daily volume rebounded 43% in Q3 but remained down 20% for 9M: the quarter has not yet established a sustained recovery.

Equities’ market share fell to 0.7% from 1.1%. Better pricing and customer/product mix narrowed its loss despite fewer revenues. International’s growth continued to benefit from the TISE acquisition, completed in 2025.

MIAX also simplified its portfolio and resolved litigation. The January sale of 90% of MIAX Derivatives Exchange left it with a retained 10% interest. The $30.0M Nasdaq settlement, paid in July, ended the case with prejudice; management says it can operate and commercialize the exchanges and technology covered by the claims without a Nasdaq license.

Key Financial Highlights

• Options economics: transaction and clearing fees reached $274M, +12%. Contracts increased 14% vs 20% for 9M, while revenue per contract fell 4.9% to $0.098; volume growth therefore did not translate fully into transaction revenue.
• Revenue quality: Q3 included $23.0M of Section 31 fees vs zero, collected from customers and remitted without operating profit. Liquidity payments fell 5.0% to $206M.
• Cost comparison: quarterly stock-based compensation fell to $7.54M from $29.1M; 2025 included IPO-triggered vesting costs. Corporate and other operating losses narrowed to $13.0M from $29.1M, explaining part of the gap between segment and consolidated profit.
• Earnings quality: 9M included a $50.6M disposal gain and $74.0M income-tax benefit, largely from releasing a deferred-tax valuation allowance—not cash operating improvement. Q3 Pyth-related unrealized gains contributed $9.80M; the prior-year quarter included a $108M debt-extinguishment loss.
• Capital and dilution: cash and equivalents rose 61% from year-end to $699M, supported partly by disposal and share-issuance proceeds. Shares outstanding rose 17% to 99.9M, primarily reflecting warrant exercises.

Risk Assessment

• Customer dependence: three customers generated 44% of Q3 revenue, primarily in Options, and can leave without an obligation to continue trading on MIAX.
• Competitive pricing and product execution: falling Options revenue per contract, Equities share losses and liquidity incentives for new futures show that attracting activity may not deliver profitable growth.
• Regulatory-cost recovery: the contested Consolidated Audit Trail funding framework prompted a $6.27M provision; adverse litigation or regulatory decisions could interrupt recovery while MIAX keeps bearing costs.
• Clearing liquidity: Dorman must meet exchange margin calls before receiving customer payments, creating exposure to client defaults and sudden liquidity demands; regulatory restrictions can also limit upstream cash transfers.

This 10-Q lists no risk factors of its own and refers to the annual report. The risks above come from the rest of this filing. Full list: the company's 10-Ks on SEC.

What to Watch

• Options monetization: market share reached 17.4%, but revenue per contract declined; sustained share gains with firmer pricing would validate growth better than volume alone.
• Futures adoption: new financial contracts and Onyx expansion need to produce recurring trading activity and narrower losses; continued incentives without improving profitability would weaken the diversification case.
• Equities recovery: improved pricing has narrowed losses, but later filings need to show market-share stabilization rather than profitability gains dependent on a shrinking business.