UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q




(Mark One)
þ	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the quarterly period ended ~~September~~June 30, ~~2017~~2018
Or
¨	Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
	For the transition period from to

Commission File Number 001-36198

INTERCONTINENTAL EXCHANGE, INC.

(Exact name of registrant as specified in its charter)



Delaware	46-2286804
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)
5660 New Northside Drive, Atlanta, Georgia	30328 (Zip Code)
(Address of principal executive offices)

(770) 857-4700

Registrant’s telephone number, including area code

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated ~~filer”,~~filer,” “accelerated ~~filer”,~~filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.




Large accelerated filer þ	Accelerated filer ¨	Non-accelerated filer ¨	Smaller reporting company ¨	Emerging growth company ¨

(Do not check if a smaller company)

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No þ

As of ~~October 31, 2017,~~July 30, 2018, the number of shares of the registrant’s Common Stock outstanding was ~~585,026,176~~573,436,542 shares.

INTERCONTINENTAL EXCHANGE, INC.

Form 10-Q

Quarterly Period Ended ~~September~~June 30, ~~2017~~2018

TABLE OF CONTENTS





PART I.	Financial Statements
Item 1	Consolidated Financial Statements (Unaudited):
	Consolidated Balance Sheets as of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016~~2017	2
	Consolidated Statements of Income for the ~~nine~~six and three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016~~2017	4
	Consolidated Statements of Comprehensive Income for the ~~nine~~six and three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016~~2017	5
	Consolidated Statements of Changes in Equity, Accumulated Other Comprehensive Loss and Redeemable Non-Controlling Interest for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and for the year ended December 31, ~~2016~~2017	6
	Consolidated Statements of Cash Flows for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016~~2017	7
	Notes to Consolidated Financial Statements	8
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2327
Item 3	Quantitative and Qualitative Disclosures About Market Risk	5154
Item 4	Controls and Procedures	5356

PART II.	Other Information
Item 1	Legal Proceedings	5457
Item 1A	Risk Factors	5457
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	5457
Item 3	Defaults Upon Senior Securities	5557
Item 4	Mine Safety Disclosures	5557
Item 5	Other Information	5558
Item 6	Exhibits	5658
SIGNATURES		5759

PART I. Financial Statements

Item 1. Consolidated Financial Statements (Unaudited)

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Balance Sheets

(In millions, except per share amounts)

(Unaudited)


	As of		As of		As of			As of
	September 30, 2017		December 31, 2016		June 30, 2018			December 31, 2017
Assets:
Current assets:
Cash and cash equivalents	$	419	$	407	$	532		$	535
Short-term investments	16		23
Short-term restricted cash and investments	762		679
Customer accounts receivable, net of allowance for doubtful accounts of $7 at both September 30, 2017 and December 31, 2016	897		777
Margin deposits and guaranty funds	52,401		55,150
Short-term restricted cash and cash equivalents					817			769
Customer accounts receivable, net of allowance for doubtful accounts of $7 and $6 at June 30, 2018 and December 31, 2017, respectively					1,049			903
Margin deposits, guaranty funds and delivery contracts receivable					54,991			51,222
Prepaid expenses and other current assets	744		97		171			133
Total current assets	55,239		57,133		57,560			53,562
Property and equipment, net	1,192		1,129		1,220			1,246
Other non-current assets:
Goodwill	12,016		12,291		12,484			12,216
Other intangible assets, net	10,056		10,420		10,223			10,269
Long-term restricted cash and investments	264		264
Long-term investments	—		432
Long-term restricted cash and cash equivalents					331			264
Other non-current assets	351		334		1,029			707
Total other non-current assets	22,687		23,741		24,067			23,456
Total assets	$	79,118	$	82,003	$	82,847		$	78,264

Liabilities and Equity:
Current liabilities:
Accounts payable and accrued liabilities	$	427	$	388	$	405		$	462
Section 31 fees payable	32		131		209			128
Accrued salaries and benefits	184		230		150			227
Deferred revenue	228		114		372			125
Short-term debt	1,197		2,493		2,645			1,833
Margin deposits and guaranty funds	52,401		55,150
Margin deposits, guaranty funds and delivery contracts payable					54,991			51,222
Other current liabilities	131		111		122			178
Total current liabilities	54,600		58,617		58,894			54,175
Non-current liabilities:
Non-current deferred tax liability, net	2,989		2,958		2,284			2,298
Long-term debt	4,865		3,871		4,271			4,267
Accrued employee benefits	264		430		235			243
Other non-current liabilities	381		337		323			296
Total non-current liabilities	8,499		7,596		7,113			7,104
Total liabilities	63,099		66,213		66,007			61,279
Commitments and contingencies
Redeemable non-controlling interest	—		36
Equity:
Intercontinental Exchange, Inc. stockholders’ equity:
Preferred stock, $0.01 par value; 100 shares authorized; no shares issued or outstanding at June 30, 2018 and December 31, 2017					—			—
Common stock, $0.01 par value; 1,500 shares authorized; 603 and 600 shares issued at June 30, 2018 and December 31, 2017, respectively, and 574 and 583 shares outstanding at June 30, 2018 and December 31, 2017, respectively					6			6
Treasury stock, at cost; 29 and 17 shares at June 30, 2018 and December 31, 2017, respectively					(1,911		)	(1,076		)


Equity:
Intercontinental Exchange, Inc. shareholders’ equity:
Preferred stock, $0.01 par value; 100 shares authorized; no shares issued or outstanding at September 30, 2017 and December 31, 2016	—			—
Common stock, $0.01 par value; 1,500 shares authorized; 600 and 596 shares issued at September 30, 2017 and December 31, 2016, respectively, and 586 and 595 shares outstanding at September 30, 2017 and December 31, 2016, respectively	6			6
Treasury stock, at cost; 14 and 1 shares at September 30, 2017 and December 31, 2016, respectively	(833		)	(40		)
Additional paid-in capital	11,423			11,306			11,477			11,392
Retained earnings	5,718			4,789			7,498			6,858
Accumulated other comprehensive loss	(322		)	(344		)	(265		)	(223		)
Total Intercontinental Exchange, Inc. shareholders’ equity	15,992			15,717
Total Intercontinental Exchange, Inc. stockholders’ equity							16,805			16,957
Non-controlling interest in consolidated subsidiaries	27			37			35			28
Total equity	16,019			15,754			16,840			16,985
Total liabilities and equity	$	79,118		$	82,003		$	82,847		$	78,264

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Income

(In millions, except per share amounts)

(Unaudited)


	Nine Months Ended September 30,						Three Months Ended September 30,						Six Months Ended June 30,						Three Months Ended June 30,
	2017			2016			2017			2016			2018			2017			2018			2017
Revenues:
Transaction and clearing, net	$	2,373		$	2,566		$	758		$	777		$	1,762		$	1,615		$	864		$	817
Data services	1,559			1,463			518			489			1,046			1,041			526			521
Listings	315			314			102			106			220			217			111			109
Other revenues	148			131			54			44			108			94			55			49
Total revenues	4,395			4,474			1,432			1,416			3,136			2,967			1,556			1,496
Transaction-based expenses:
Section 31 fees	275			290			92			94			211			183			90			92
Cash liquidity payments, routing and clearing	635			823			197			244			454			438			220			224
Total revenues, less transaction-based expenses	3,485			3,361			1,143			1,078			2,471			2,346			1,246			1,180
Operating expenses:
Compensation and benefits	710			708			231			236			481			483			241			236
Professional services	94			101			30			32			59			64			29			32
Acquisition-related transaction and integration costs	27			61			4			14			27			23			15			9
Technology and communication	294			277			99			93			213			195			108			97
Rent and occupancy	52			52			17			17			33			35			16			17
Selling, general and administrative	117			83			38			31			72			79			39			38
Depreciation and amortization	404			470			128			181			281			276			143			142
Total operating expenses	1,698			1,752			547			604			1,166			1,155			591			571
Operating income	1,787			1,609			596			474			1,305			1,191			655			609
Other income (expense):
Interest expense	(137		)	(134		)	(47		)	(44		)	(107		)	(90		)	(55		)	(45		)
Other income, net	198			24			11			13			30			191			11			3
Other income (expense), net	61			(110		)	(36		)	(31		)	(77		)	101			(44		)	(42		)
Income before income tax expense	1,848			1,499			560			443			1,228			1,292			611			567
Income tax expense	537			409			185			93			292			354			149			140
Net income	$	1,311		$	1,090		$	375		$	350		$	936		$	938		$	462		$	427
Net income attributable to non-controlling interest	(22		)	(20		)	(6		)	(6		)	(17		)	(16		)	(7		)	(8		)
Net income attributable to Intercontinental Exchange, Inc.	$	1,289		$	1,070		$	369		$	344		$	919		$	922		$	455		$	419
Earnings per share attributable to Intercontinental Exchange, Inc. common shareholders:
Earnings per share attributable to Intercontinental Exchange, Inc. common stockholders:
Basic	$	2.18		$	1.80		$	0.63		$	0.58		$	1.59		$	1.56		$	0.79		$	0.71
Diluted	$	2.17		$	1.79		$	0.62		$	0.57		$	1.58		$	1.55		$	0.78		$	0.71
Weighted average common shares outstanding:
Basic	591			595			588			596			580			593			578			591
Diluted	595			599			592			600			583			597			581			595
Dividend per share	$	0.60		$	0.51		$	0.20		$	0.17		$	0.48		$	0.40		$	0.24		$	0.20

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income

(In millions)

(Unaudited)


	Nine Months Ended September 30,						Three Months Ended September 30,						Six Months Ended June 30,						Three Months Ended June 30,
	2017			2016			2017			2016			2018			2017			2018			2017
Net income	$	1,311		$	1,090		$	375		$	350		$	936		$	938		$	462		$	427
Other comprehensive income (loss):
Foreign currency translation adjustments, net of tax (expense) benefit of ($11) and $1 for the nine months ended September 30, 2017 and 2016, respectively, and ($4) for the three months ended September 30, 2017	130			(245		)	45			(46		)
Foreign currency translation adjustments, net of tax (expense) benefit of $1 and ($7) for the six months ended June 30, 2018 and 2017, respectively, and $1 and ($7) for the three months ended June 30, 2018 and 2017, respectively													(42		)	85			(75		)	60
Change in fair value of available-for-sale securities	68			117			—			(12		)	—			68			—			—
Reclassification of realized gain on available-for-sale investment to other income	(176		)	—			—			—			—			(176		)	—			—
Other comprehensive income (loss)	22			(128		)	45			(58		)	(42		)	(23		)	(75		)	60
Comprehensive income	$	1,333		$	962		$	420		$	292		$	894		$	915		$	387		$	487
Comprehensive income attributable to non-controlling interest	(22		)	(20		)	(6		)	(6		)	(17		)	(16		)	(7		)	(8		)
Comprehensive income attributable to Intercontinental Exchange, Inc.	$	1,311		$	942		$	414		$	286		$	877		$	899		$	380		$	479

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Changes in Equity, Accumulated Other Comprehensive Loss

and Redeemable Non-Controlling Interest

(In millions)

(Unaudited)


	Intercontinental Exchange, Inc. Shareholders' Equity																		Non- Controlling Interest in Consolidated Subsidiaries			Total Equity			Redeemable Non-Controlling Interest			Intercontinental Exchange, Inc. Stockholders’ Equity																	Non- Controlling Interest in Consolidated Subsidiaries			Total Equity			Redeemable Non-Controlling Interest
	Common Stock				Treasury Stock					Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss												Common Stock			Treasury Stock					Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss
	Shares		Value		Shares		Value			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss												Shares	Value		Shares		Value			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Loss
Balance, as of December 31, 2015	628		$	6	(34	)	$	(1,448	)	$	12,290		$	4,148		$	(188	)	$	32		$	14,840		$	35
Other comprehensive loss	—		—		—		—			—			—			(156		)	—			(156		)	—
Exercise of common stock options	1		—		—		—			22			—			—			—			22			—
Treasury shares retired in connection with stock split	(35	)	—		35		1,512			(1,142		)	(370		)	—			—			—			—
Repurchases of common stock	—		—		(1	)	(50		)	—			—			—			—			(50		)	—
Payments relating to treasury shares	—		—		(1	)	(54		)	—			—			—			—			(54		)	—
Stock-based compensation	—		—		—		—			136			—			—			—			136			—
Issuance of restricted stock	2		—		—		—			—			—			—			—			—			—
Adjustment to redemption value	—		—		—		—			—			(2		)	—			—			(2		)	1
Distributions of profits	—		—		—		—			—			—			—			(19		)	(19		)	(3		)
Dividends paid to shareholders	—		—		—		—			—			(409		)	—			—			(409		)	—
Net income attributable to non-controlling interest	—		—		—		—			—			(27		)	—			24			(3		)	3
Net income	—		—		—		—			—			1,449			—			—			1,449			—
Balance, as of December 31, 2016	596		6		(1	)	(40		)	11,306			4,789			(344		)	37			15,754			36			596	$	6	(1	)	$	(40	)	$	11,306		$	4,810		$	(344	)	$	37		$	15,775		$	36
Other comprehensive income	—		—		—		—			—			—			22			—			22			—			—	—		—		—			—			—			121			—			121			—
Exercise of common stock options	—		—		—		—			11			—			—			—			11			—			—	—		—		—			17			—			—			—			17			—
Repurchases of common stock	—		—		(11	)	(709		)	—			—			—			—			(709		)	—			—	—		(15	)	(949		)	—			—			—			—			(949		)	—
Payments relating to treasury shares	—		—		(2	)	(85		)	—			—			—			—			(85		)	—			—	—		(1	)	(88		)	—			—			—			—			(88		)	—
Stock-based compensation	—		—		—		—			116			—			—			—			116			—			—	—		—		—			152			—			—			—			152			—
Issuance of restricted stock	4		—		—		1			(1		)	—			—			—			—			—			4	—		—		1			(1		)	—			—			—			—			—
Acquisition of non-controlling interest	—		—		—		—			(9		)	—			—			(5		)	(14		)	—			—	—		—		—			(82		)	—			—			(10		)	(92		)	—
Distributions of profits																												—	—		—		—			—			—			—			(26		)	(26		)	—
Dividends paid to stockholders																												—	—		—		—			—			(476		)	—			—			(476		)	—
Acquisition of redeemable non-controlling interest	—		—		—		—			—			(2		)	—			—			(2		)	(37		)	—	—		—		—			—			(2		)	—			—			(2		)	(37		)
Distributions of profits	—		—		—		—			—			—			—			(26		)	(26		)	—
Dividends paid to shareholders	—		—		—		—			—			(358		)	—			—			(358		)	—
Net income attributable to non-controlling interest	—		—		—		—			—			(22		)	—			21			(1		)	1			—	—		—		—			—			(28		)	—			27			(1		)	1
Net income	—		—		—		—			—			1,311			—			—			1,311			—			—	—		—		—			—			2,554			—			—			2,554			—
Balance, as of September 30, 2017	600		$	6	(14	)	$	(833	)	$	11,423		$	5,718		$	(322	)	$	27		$	16,019		$	—
Balance, as of December 31, 2017																												600	6		(17	)	(1,076		)	11,392			6,858			(223		)	28			16,985			—
Other comprehensive loss																												—	—		—		—			—			—			(42		)	—			(42		)	—
Exercise of common stock options																												—	—		—		—			12			—			—			—			12			—
Repurchases of common stock																												—	—		(10	)	(759		)	—			—			—			—			(759		)	—
Payments relating to treasury shares																												—	—		(2	)	(76		)	—			—			—			—			(76		)	—
Stock-based compensation																												—	—		—		—			73			—			—			—			73			—
Issuance of restricted stock																												3	—		—		—			—			—			—			—			—			—
Distributions of profits																												—	—		—		—			—			—			—			(10		)	(10		)	—
Dividends paid to stockholders																												—	—		—		—			—			(279		)	—			—			(279		)	—
Net income attributable to non-controlling interest																												—	—		—		—			—			(17		)	—			17			—			—
Net income																												—	—		—		—			—			936			—			—			936			—
Balance, as of June 30, 2018																												603	$	6	(29	)	$	(1,911	)	$	11,477		$	7,498		$	(265	)	$	35		$	16,840		$	—


	As of			As of			As of			As of
	September 30, 2017			December 31, 2016			June 30, 2018			December 31, 2017
Accumulated other comprehensive loss was as follows:
Foreign currency translation adjustments	$	(215	)	$	(345	)	$	(178	)	$	(136	)
Fair value of available-for-sale securities	—			108
Comprehensive income from equity method investment	2			2			2			2
Employee benefit plans adjustments	(109		)	(109		)	(89		)	(89		)
Accumulated other comprehensive loss	$	(322	)	$	(344	)	$	(265	)	$	(223	)

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In millions)

(Unaudited)


	Nine Months Ended September 30,						Six Months Ended June 30,
	2017			2016			2018			2017
Operating activities:
Net income	$	1,311		$	1,090		$	936		$	938
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	404			470			281			276
Stock-based compensation	102			90			61			68
Deferred taxes	58			20			(7		)	(11		)
Cetip realized investment gain, net	(114		)	—			—			(114		)
Other	(13		)	2			(4		)	(7		)
Changes in assets and liabilities:
Customer accounts receivable	(153		)	(88		)	(148		)	(170		)
Other current and non-current assets	(29		)	(8		)	(39		)	(37		)
Section 31 fees payable	(99		)	(83		)	80			51
Deferred revenue	133			144			249			240
Other current and non-current liabilities	(190		)	(129		)	(173		)	(135		)
Total adjustments	99			418			300			161
Net cash provided by operating activities	1,410			1,508			1,236			1,099

Investing activities:
Capital expenditures	(136		)	(166		)	(33		)	(81		)
Capitalized software development costs	(104		)	(88		)	(75		)	(69		)
Cash received for divestitures (net of cash paid for acquisitions)	9			—
Proceeds from sale of Cetip, net	438			—			—			438
Decrease (increase) in restricted cash and investments	(80		)	18
Other	—			(70		)
Cash paid for acquisitions, net of cash received for divestiture							(405		)	10
Purchases of investments							(305		)	—
Net cash provided by (used in) investing activities	127			(306		)	(818		)	298

Financing activities:
Repayments of commercial paper, net	(445		)	(1,006		)
Proceeds from debt facilities, net	985			—
Repayments of debt facilities	(850		)	—
Proceeds from (repayments of) commercial paper, net							812			(469		)
Repurchases of common stock	(709		)	—			(759		)	(469		)
Dividends to shareholders	(358		)	(307		)
Dividends to stockholders							(279		)	(239		)
Payments relating to treasury shares received for restricted stock tax payments and stock option exercises	(85		)	(51		)	(76		)	(81		)
Acquisition of non-controlling interest and redeemable non-controlling interest	(55		)	—			—			(55		)
Other	(17		)	(2		)	1			(8		)
Net cash used in financing activities	(1,534		)	(1,366		)	(301		)	(1,321		)
Effect of exchange rate changes on cash and cash equivalents	9			(5		)
Net increase (decrease) in cash and cash equivalents	12			(169		)
Cash and cash equivalents, beginning of period	407			627
Cash and cash equivalents, end of period	$	419		$	458
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents							(5		)	5
Net increase in cash, cash equivalents, and restricted cash and cash equivalents							112			81
Cash, cash equivalents, and restricted cash and cash equivalents, beginning of period							1,568			1,350
Cash, cash equivalents, and restricted cash and cash equivalents, end of period							$	1,680		$	1,431

Supplemental cash flow disclosure:
Cash paid for income taxes	$	511		$	362		$	346		$	429
Cash paid for interest	$	99		$	92		$	104		$	87

See accompanying notes.

Intercontinental Exchange, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)


1.	Description of Business

We are a leading global operator of regulated exchanges, clearing houses and listings venues, and a provider of data services for commodity, fixed income and ~~financial~~equity markets. We operate regulated marketplaces for listing, trading and clearing a broad array of derivatives ~~contracts~~ and securities contracts across major asset classes, including energy and agricultural commodities, interest rates, equities, equity derivatives, ~~exchange traded~~exchange-traded funds, or ETFs, credit derivatives, bonds and currencies. We also offer end-to-end ~~market~~ data services and solutions to support the trading, investment, ~~and~~ risk management and connectivity needs of customers around the world across ~~virtually~~ all major asset classes.

Our exchanges include ~~futures~~derivative exchanges in the United States, or U.S., United Kingdom, or U.K., European Union, or EU, Canada and Singapore, and cash equities, equity options and bond exchanges in the U.S. We also operate over-the-counter, or OTC, markets for physical energy, fixed income and credit default swaps, or CDS, trade execution. To serve global derivatives markets, we operate central counterparty clearing houses in the U.S., U.K., EU, Canada and Singapore (Note 9)10). We offer a range of data services for global financial and commodity markets, including pricing and reference data, exchange data, analytics, feeds, ~~desktop~~index services, desktops and connectivity solutions. Through our markets, clearing houses, listings and market data services, we provide end-to-end solutions for our customers through liquid markets, benchmark products, access to capital markets, and related services to support their ability to manage risk and raise capital. Our business is currently conducted as two reportable business segments, our Trading and Clearing segment and our Data and Listings segment, and the majority of our identifiable assets are located in the U.S., U.K. and Canada (Note 13).

2. Summary of Significant Accounting Policies


2.	~~Summary of Significant Accounting Policies~~

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared by us in accordance with U.S. generally accepted accounting principles, or U.S. GAAP, pursuant to the rules and regulations of the Securities and Exchange Commission, or SEC, regarding interim financial reporting. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements and should be read in conjunction with our audited consolidated financial statements and related notes thereto for the year ended December 31, ~~2016.~~2017. The accompanying unaudited consolidated financial statements reflect all adjustments that are, in our opinion, necessary for a fair presentation of results for the interim periods presented. ~~These~~We believe that these adjustments are of a normal recurring nature.

Preparing financial statements requires us to make certain estimates and assumptions that affect the amounts that are reported in the consolidated financial statements and accompanying disclosures. ~~Although these estimates are based on our best knowledge of current events and actions that we may undertake in the future, actual~~Actual results may be different from these estimates. The results of operations for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018 are not necessarily indicative of the results to be expected for any future period or the full fiscal year.

The accompanying unaudited consolidated financial statements include ~~the~~our accounts and those of ~~us and~~ our wholly-owned and controlled subsidiaries. All intercompany balances and transactions between us and our wholly-owned and controlled subsidiaries have been eliminated in the consolidation. For those consolidated subsidiaries in which our ownership is less than 100% and for which we have control over the assets and liabilities and the management of the entity, the outside stockholders’ interests are shown as non-controlling interests. ~~In instances where outside stockholders’ hold an option to require us to repurchase the outside stockholders’ interest, these interests are shown as redeemable non-controlling interests (Note 3).~~

~~Held for Sale~~Reclassifications

~~We classify long-lived assets or disposal groups as held for sale in the~~Certain prior period in which all of the following criteria are met: management commits to a plan to sell; the long-lived asset or disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such long-lived assets or disposal groups; an active program to locate a buyer and other actions required to complete the plan to sellamounts have been ~~initiated; the sale is probable within one year; the asset or disposal group is being actively marketed for sale at a price that is reasonable in relation~~reclassified to ~~its current fair value; and it is unlikely that significant changes~~conform to the ~~plan will be made or that the plan will be withdrawn. Long-lived assets and disposal groups classified as held~~current period’s financial statement presentation. See "Recently Adopted Accounting Pronouncements" below for ~~sale are measured at the lower~~a discussion of their carrying amount or fair value less costs to sell. Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met. Conversely, gains are not recognized until the dateour adoption of sale. The fair value of a long-lived asset less any costs to sell is assessed each reporting period it remains classified as held for sale, and any change in fair value is reported as an adjustment to the carrying value of the asset, except that increases in fair value are limited to prior decreases recorded. Upon being classified as held for sale, depreciation and amortization is ceased. See Note 10 for information regarding our classification of Trayport as held for sale as of ~~September 30, 2017.~~new accounting standards.

~~New and~~ Recently Adopted Accounting Pronouncements

~~The Financial~~On January 1, 2018, we adopted Accounting Standards ~~Board,~~Codification, or ~~FASB, has issued Accounting Standards Update No. 2014-09,~~ASC, Topic 606, Revenue from Contracts with Customers ~~(Topic 606)~~, ~~or ASU~~and ASC 340-40, Other Assets and Deferred Costs - Contracts with Customers, collectively referred to as ASC 606. ~~ASU~~ASC 606 provides guidance outlining a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers that supersedes most ~~current~~ revenue recognition guidance. This guidance requires us to recognize revenue when we transfer promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ~~We are required to adopt ASU~~ASC 606 ~~at the beginning of our first quarter of fiscal 2018. The new guidance~~ requires enhanced disclosures, including revenue recognition policies to identify performance obligations to customers and significant judgments in measurement and recognition. ~~The new guidance may be applied~~We adopted ASC 606 retrospectively toand restated each prior period presented ~~or retrospectively with the cumulative effect recognized as~~to reflect our adoption thereof. The impacts of ~~the date~~our adoption of adoption. We will apply the guidance retrospectively to each prior period presented when adopted, and provide the relevant disclosures in the first interim and annual periods in which we adopt the guidance. BasedASC 606 on our ~~preliminary assessment, we expect that~~results for the years ended December 31, 2017, 2016 and 2015, respectively, were disclosed in our 2017 Form 10-K.

The adoption ~~may accelerate~~of ASC 606 accelerated the timing of recognition of a portion of original listing fees related to our New York Stock Exchange, or NYSE, ~~businesses, which are currently deferred over an estimated customer life of nine years. We do not expect~~businesses. In addition, and to a lesser extent, the adoption decelerated the timing of ~~this guidance~~recognition of a portion of clearing fee revenues. Revenue recognition related to ~~have a material~~all other trading, clearing and data businesses remains unchanged.

Our adoption of ASC 606 had the following impact on our ~~consolidated financial statements within any accounting period presented. We are continuing~~reported results for the prior periods presented, driven primarily by the accelerated recognition of listings fee revenue in our ~~assessment, which may identify other impacts of the~~NYSE businesses (in millions, except earnings per share):



	As Reported		New Revenue Standard Adjustment		As Adjusted
Six months ended June 30, 2017
Total revenues	$	2,963	$	4	$	2,967
Total revenues, less transaction-based expenses	2,342		4		2,346
Income tax expense	352		2		354
Net income attributable to Intercontinental Exchange, Inc.	920		2		922
Basic earnings per share	$	1.55	$	0.01	$	1.56
Diluted earnings per share	$	1.54	$	0.01	$	1.55



	As Reported		New Revenue Standard Adjustment		As Adjusted
Three months ended June 30, 2017
Total revenues	$	1,494	$	2	$	1,496
Total revenues, less transaction-based expenses	1,178		2		1,180
Income tax expense	139		1		140
Net income attributable to Intercontinental Exchange, Inc.	418		1		419
Basic earnings per share	$	0.71	$	—	$	0.71
Diluted earnings per share	$	0.70	$	0.01	$	0.71



	As Reported		New Revenue Standard Adjustment			As Adjusted
As of December 31, 2017
Deferred revenue, current	$	121	$	4		$	125
Deferred revenue, non-current	143		(52		)	91
Net deferred tax liabilities	2,280		15			2,295
Retained earnings	6,825		33			6,858

Additional disclosures related to our adoption of ~~ASU 606.~~ASC 606 are provided in Note 4.

The Financial Accounting Standards Board, or FASB, has issued Accounting Standards Update, ~~No. 2016-01,~~ ~~Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities,~~ or ASU, 2016-01. ASU 2016-01 provides updated guidance for the recognition, measurement, presentation, and disclosure of certain financial assets and liabilities, including the requirement that equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) are to be measured at fair value with changes in fair value recognized in net income. We are required to adopt ASU 2016-01 at the beginning of our first quarter of fiscal 2018. On October 24, 2017, we made an investment in Euroclear plc, or Euroclear (Note 3), which will be impacted by our adoption of ASU 2016-01. Euroclear does not currently have a readily determinable fair market value as it is not a publicly listed company. Therefore, in accordance with and upon adoption of ASU 2016-01, we would only adjust the fair value of our investment in Euroclear if there is an observable price change in an orderly Euroclear transaction and any change in the fair value will be recognized in net income.

~~The FASB has issued Accounting Standards Update No. 2016-02,~~ ~~Leases,~~ ~~or ASU 2016-02.~~ASU 2016-02 requires an entity to recognize both assets and liabilities arising from financing and operating leases, along with additional qualitative and quantitative disclosures. A lessee should recognize in its balance sheet a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. ASU 2016-02 is required to be adopted at the beginning of our first quarter of fiscal 2019, with early adoption permitted. We will not adopt ASU 2016-02 early, but we are currently evaluating this guidance to determine the potential impact on our consolidated financial statements.

~~The FASB has issued Accounting Standards Update No. 2016-18,~~ ~~Statement of Cash Flows: Restricted Cash~~, or ASU 2016-18, that will require entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. When cash, cash equivalents, restricted cash and restricted cash equivalents are presented in more than one line item on the balance sheet, the new guidance requires a reconciliation of the totals in the statement of cash flows to the related captions in the balance sheet. This reconciliation can be presented either on the face of the statement of cash flows or in the notes to the financial statements. Entities will also have to disclose the nature of their restricted cash and restricted cash equivalent balances. We are required to adopt ASU 2016-18 at the beginning of our first quarter of fiscal 2018, with early adoption permitted. We will be required to apply the guidance retrospectively when adopted, and provide the relevant disclosures in the first interim and annual periods in which we adopt the guidance. We will not adopt ASU 2016-18 early, but do expect to be impacted by the new presentation and disclosure requirements required by ASU 2016-18 due to our restricted and unrestricted cash balances.

~~The FASB has issued Accounting Standards Update~~ No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost, or ASU 2017-07. The amendments in this update require that an employer disaggregate the service cost component from the other components of net benefit cost. The amendments also provide explicit guidance on how to present the service cost component in the same line item as other related compensation costs, and the other components of net benefit cost in the income statement outside of operating income. The guidance only allows the service cost component of net benefit cost to be eligible for capitalization. We adopted ASU 2017-07 on January 1, 2018 retrospectively to each prior period presented. We have a pension plan, a U.S. nonqualified supplemental executive retirement plan, and post-retirement defined benefit plans that are all impacted by the guidance. Each of the plans are frozen and do not have a service cost component, which means the expense or benefit recognized under each plan represents other components of net benefit cost as defined in the guidance. The combined net periodic (expense) benefit of these plans was ($4 million) and $4 million for the six months ended June 30, 2018 and 2017, respectively, and ($2 million) and $2 million for the three months ended June 30, 2018 and 2017, respectively, and was previously reported as an adjustment to compensation and benefits expenses in the accompanying consolidated statements of income. Following our adoption of ASU 2017-07, these amounts were reclassified to be included in other income, net, in the accompanying consolidated statements of income, and these adjustments had no impact on net income.

The FASB has issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, or ASU 2016-01. ASU 2016-01 provides updated guidance for the recognition, measurement, presentation, and disclosure of certain financial assets and liabilities, including the requirement that equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) are to be measured at fair value with changes in fair value recognized in net income. We adopted ASU 2016-01 on January 1, 2018. Our equity investments, including our investments in Euroclear plc, or Euroclear (Note 3) and Coinbase Global, Inc., or Coinbase, among others, are now subject to valuation under ASU 2016-01. These investments do not currently have readily determinable fair market values as they are not publicly-listed companies. ASU 2016-01 permits a policy election to only adjust the fair value of such investments if and when there is an observable price change in an orderly transaction of a similar or identical investment occurring after adoption, with any change in fair value recognized in net income. We have made this policy election for all of our equity investments without readily determinable fair values, and our adoption of ASU 2016-01 did not result in any fair value adjustments as of June 30, 2018.

In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118, or SAB 118, which provided guidance for companies that have not completed their accounting for income tax effects of the Tax Cuts and Jobs Act, or TCJA, in the period of enactment, allowing for a measurement period of up to one year after the enactment date to finalize the recording of the related tax impacts. We are applying the guidance in SAB 118 when accounting for the enactment-date effects of the TCJA. As of June 30, 2018, our estimates recorded as of December 31, 2017 for the tax effects of the TCJA, are not final. Our estimates recorded at December 31, 2017 and as of June 30, 2018 may be affected due to changes in interpretations of the legislation, changes in accounting standards or related interpretations in response to the TCJA. We have also made reasonable estimates of the TCJA’s impact on state income tax. Our estimates are based on the best available information as of June 30, 2018 and our interpretation of the TCJA and related state tax implications as currently enacted. Our estimates do not include any potential federal or state administrative and/or legislative adjustments to certain provisions of the TCJA and related state provisions. We will continue to analyze the TCJA in order to finalize related federal and state impacts within the measurement period.

In January 2018, the FASB staff issued Question & Answer Topic 740, No. 5, Accounting for Global Intangible Low-Taxed Income, stating that a company may either elect to treat taxes due on future inclusions on its non-U.S. income in its U.S. taxable income under the newly enacted Global Intangible Low-Taxed Income provisions as a current period expense when incurred, or factor them into the company’s measurement of its deferred taxes. As of June 30, 2018, we have not completed our analysis of the two different accounting policies and have not made an election. We will continue our analysis and will make an election within the measurement period as provided for under SAB 118.

In the fourth quarter of 2017, we adopted ASU 2016-18, Statement of Cash Flows: Restricted Cash, or ASU 2016-18, which requires us to show the changes in the total of cash, cash equivalents, restricted cash and cash equivalents in the statement of cash flows. As a result, we no longer present transfers between cash and cash equivalents and restricted cash and cash equivalents in the statement of cash flows. We have reclassified changes in restricted cash from cash flows provided by (used in) investing activities, to the total change in beginning and end-of-period total changes. Our statements of cash flows for the six months ended June 30, 2018 and 2017 reflect this change.

Accounting Pronouncements Not Yet Adopted

The FASB has issued ASU No. 2016-02, Leases, or ASU 2016-02.ASU 2016-02 requires an entity to recognize both assets and liabilities arising from financing and operating leases, along with additional qualitative and quantitative disclosures. A lessee should recognize a liability in its balance sheet to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. In transition, lessees and lessors are required to ~~adopt~~recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. ASU ~~2017-07~~2016-02 is required to be adopted at the beginning of our first quarter of fiscal year 2019, with early adoption permitted. We will not adopt ASU 2016-02 early and we are currently evaluating this guidance to determine the potential impact on our consolidated financial statements.

The FASB has issued ASU No. 2016-13, Financial Instruments - Measurement of Credit Losses on Financial Instruments, or ASU 2016-13. ASU 2016-13 applies to all financial instruments carried at amortized cost including held-to-maturity debt securities as well as trade receivables. ASU 2016-13 requires financial assets carried at amortized cost to be presented at the net amount expected to be collected and available-for-sale debt securities to record credit losses through an allowance for credit losses. ASU 2016-13 is required to be adopted at the beginning of our first quarter of fiscal year 2020, with early adoption permitted. We will not adopt ASU 2016-13 early and we are currently evaluating this guidance to determine the potential impact on our consolidated financial statements.

The FASB has issued ASU No. 2018-02, Reclassification of Certain Tax Effects from Accumulative Other Comprehensive Income, or ASU 2018-02. ASU 2018-02 gives entities the option to reclassify certain tax effects related to items in accumulated

other comprehensive income, or OCI, that have been stranded in OCI as a result of the enactment of the TCJA to retained earnings. The guidance is effective for fiscal years beginning after December 15, 2018 with early adoption permitted. We will ~~be required to apply the guidance retrospectively when adopted, and provide the relevant disclosures in the first interim and annual periods in which we adopt the guidance. We will~~ not adopt ASU ~~2017-07~~2018-02 early and we ~~do not expect the adoption of~~are currently evaluating this guidance to ~~have a material~~determine the potential impact on our consolidated financial ~~statements within any accounting period presented.~~statements.


3.	Acquisitions ~~Investments~~ and ~~Divestitures~~Investments

~~Pending Acquisition of Virtu BondPoint~~Acquisitions

On ~~October 24, 2017,~~January 2, 2018, we ~~entered into a definitive agreement to acquire~~acquired 100% of ~~Virtu~~ BondPoint from Virtu Financial, Inc. for $400 million in cash. ~~The transaction is expected to close in the first quarter of 2018, and the closing is subject to applicable regulatory reviews and approvals. Virtu~~ BondPoint is a leading provider of electronic fixed income trading solutions for the buy-side and sell-side, offering access to centralized liquidity and automated trade execution services through its alternative trading system, or ATS, ~~linking~~and provides trading services to more than 500 financial services firms. BondPoint is primarily included in our Trading and Clearing segment.

The BondPoint purchase price was allocated to the preliminary net tangible and identifiable intangible assets and liabilities based on their estimated fair values as of January 2, 2018. The identifiable intangible assets acquired were $130 million and included (i) customer relationships of $123 million, which have been assigned a useful life of 15 years, and (ii) developed technology of $7 million, which has been assigned a life of three years. The excess of the purchase price over the preliminary net tangible and identifiable intangible assets was $267 million and was recorded as goodwill.

On July 18, 2018, we acquired CHX Holdings, Inc., the parent company of the Chicago Stock Exchange, or CHX, a full-service stock exchange, including trading, data and corporate listings services. CHX operates as a registered national securities exchange, and will primarily be included in our Trading and Clearing segment.

On July 23, 2018, we acquired TMC Bonds, LLC for $701 million in cash. The cash consideration is gross of the $14 million cash held by TMC Bonds, LLC on the date of acquisition. TMC Bonds, LLC is an electronic fixed income marketplace, supporting anonymous trading across multiple protocols in various asset classes, including municipals, corporates, treasuries, agencies and certificates of deposit. TMC Bonds, LLC is primarily included in our Trading and Clearing segment.

Investment in Euroclear

~~On October 24,~~During the year ended December 31, 2017, we ~~acquired~~purchased a 4.7% stake in Euroclear ~~for €275~~valued at €276 million ($~~326~~327 million), which included our representation on the Euroclear Board of Directors. During the same period, we negotiated an additional purchase which closed on February 21, 2018 following regulatory approval, and which did not include additional representation on the Euroclear Board of Directors. This provided us with an additional 5.1% stake in ~~cash.~~Euroclear for a purchase price of €246 million in cash ($304 million based on a euro/U.S. dollar exchange rate of 1.2368 as of February 21, 2018). As of June 30, 2018, we owned a 9.8% stake in Euroclear for a total investment of $631 million. Euroclear is a leading provider of post-trade services, including settlement, central securities depositories and related services for cross-border transactions across asset classes.

~~Acquisition of Global Research Division~~’~~s Index Business from Bank of America Merrill Lynch, or BofAML~~

~~On October 20, 2017, we acquired BofAML's Global Research division’s index business. BofAML indices are the second largest group of fixed income indices~~We classify our investment in Euroclear as ~~measured by~~an equity investment included in other non-current assets ~~under management, or AUM, globally. The AUM benchmarked against our combined fixed income indices is nearly $1 trillion, and the indices have been re-branded as the ICE BofAML indices.~~

~~Purchase of Minority Interests~~

For consolidated subsidiaries in which our ownership is less than 100% and for which we have control over the assets, liabilities and management of the entity, the outside stockholders’ interests are shown as non-controlling interest in our consolidated financial statements. As of December 31, 2016, non-controlling interest included those related to the operating results of our CDS clearing subsidiaries in which non-ICE limited partners held a 42.5% net profit sharing interest; ICE Endex in which Gasunie held a 21% ownership interest; and ICE Clear Netherlands in which ABN AMRO Clearing Bank N.V. held a 25% ownership interest. For both ICE Endex and ICE Clear Netherlands, in addition to the non-controlling interest reported in the consolidated statements of income, we reported redeemable non-controlling interest in the consolidated balance sheets which represents the minority interest redemption fair value for each company.

During June 2017, we purchased both Gasunie’s 21% minority ownership interest in ICE Endex and ABN AMRO Clearing Bank N.V.’s 25% minority ownership interest in ICE Clear Netherlands. Subsequent to these acquisitions, we own 100% of ICE Endex and ICE Clear Netherlands and will no longer include any non-controlling interest amounts for ICE Endex and ICE Clear Netherlands in our consolidated financial statements. During April 2017, we purchased 3.2% of the net profit sharing interest in our CDS clearing subsidiaries from a non-ICE limited partner and the remaining non-ICE limited partners hold a 39.3% net profit sharing interest as of September 30, 2017.

~~NYSE Governance Services Divestiture~~

On June 1, 2017, we sold NYSE Governance Services to Marlin Heritage, L.P. NYSE Governance Services provides governance and compliance analytics and education solutions for organizations and their boards of directors through dynamic learning solutions. We recognized a net loss of $6 million on the sale of NYSE Governance Services, which was recorded as amortization expense within our data and listings segment in the accompanying consolidated ~~statements~~balance sheets. As discussed in Note 2, we adopted ASU 2016-01 on January 1, 2018. Under ASU 2016-01, for investments without a readily determinable fair value, we may elect to measure them at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions in similar or identical investments. We have elected to use this approach to estimate the value of ~~income for~~ the ~~nine~~Euroclear investment. During the six months and three months ended ~~September~~June 30, ~~2017.~~

~~TMX Atrium Acquisition~~

~~On May 1, 2017, we acquired 100%~~2018, there were no downward or upward adjustments made to the carrying amount of TMX Atrium, a global extranet and wireless services business, from TMX Group. TMX Atrium provides low-latency access to markets and market data across 12 countries, more than 30 major trading venues, and ultra-low latency wireless connectivity to access markets and market data in the Toronto, New Jersey and Chicago metro areas. The wireless assets consist of microwave and millimeter networks that transport market data and provide private bandwidth. TMX Atrium is now part of ICE Data Services and is being integrated with our connectivity services.

~~Interactive Data Managed Solutions (IDMS) Divestiture~~

On March 31, 2017, we sold Interactive Data Managed Solutions, or IDMS, a unit of Interactive Data, to FactSet. IDMS is a managed solutions and portal provider for the global wealth management industry. There was no gain or loss recognized on the sale of IDMS.

~~National Stock Exchange Acquisition~~

On January 31, 2017, we acquired 100% of National Stock Exchange, Inc., now named NYSE National. The acquisition gives the NYSE Group a fourth U.S. exchange license. NYSE National is distinct from NYSE Group’s three listings exchanges because NYSE National will only be a trading venue and will not be a listings market. NYSE Group’s three listings exchanges, NYSE, NYSE American (NYSE American was formerly known as NYSE MKT) and NYSE Arca, have unique market models designed for corporate and exchange traded fund, or ETF, issuers. After closing the transaction, NYSE National ceased operations on February 1, 2017. We will engage with NYSE National members, buy-side participants and retail brokerage firms before finalizing operational plans for NYSE National’s re-launch, which is expected to occur in 2018.Euroclear.


4.	Revenue Recognition

We adopted ASC 606 on January 1, 2018 on a full retrospective basis and have restated the prior reporting periods presented as if ASC 606 had always been applied (Note 2). Our adoption of ASC 606 did not have a material impact on the measurement or recognition of revenue in any prior or current reporting periods. Our adoption of ASC 606 was subject to the same internal controls over financial reporting that we apply to our consolidated financial statements.

Substantially all of our revenues are considered to be revenues from contracts with customers. The related accounts receivable balances are recorded in our balance sheets as customer accounts receivable. We do not have obligations for warranties, returns or refunds to customers, other than the rebates discussed below, which are settled each period and therefore do not result in variable consideration. We do not have significant revenue recognized from performance obligations that were satisfied in prior periods and we do not have any transaction price allocated to unsatisfied performance obligations other than in our deferred revenue. Deferred revenue represents our contract liabilities related to our annual, original and other listings revenues as well as certain data services,

clearing services and other revenues. Deferred revenue is the only significant contract asset or liability impacted by our adoption of ASC 606. See Note 6 for our discussion of deferred revenue balances, activity, and expected timing of recognition. As permitted by ASC 606, we have elected not to provide disclosures about transaction price allocated to unsatisfied performance obligations if contract durations are less than one year, or if we are not required to estimate the transaction price. For all of our contracts with customers, except for listings and certain data and clearing services, our performance obligations are short-term in nature and there is no significant variable consideration. See the bullets below for further descriptions of our revenue contracts. In addition, we have elected the practical expedient of excluding sales taxes from transaction prices. We have assessed the costs incurred to obtain or fulfill a contract with a customer and determined them to be immaterial.

Certain judgments and estimates were used in the identification and timing of satisfaction of performance obligations and the related allocation of transaction price. We believe that these represent a faithful depiction of the transfer of services to our customers.

Our primary revenue contract classifications are described below. Although we discuss additional revenue details in our “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” the categories below best represent those that depict similar economic characteristics of the nature, amount, timing and uncertainty of our revenues and cash flows.

Transaction and clearing, net - Transaction and clearing revenues represent fees charged for the performance obligations of derivatives trading and clearing, and from our cash trading and equity options exchanges. The derivatives trading and clearing fees contain two performance obligations: (1) trade execution/clearing novation and (2) risk management of open interest. We allocate the transaction price between these two performance obligations; however, both of these generally occur almost simultaneously and no significant deferral results. The impact of our adoption of ASC 606 on our performance obligations in our clearing business was minimal. Cash trading and equity options fees contain one performance obligation related to trade execution which occurs instantaneously. Our transaction and clearing revenues are reported net of rebates, except for the NYSE transaction-based expenses. Transaction and clearing fees can be variable based on trade volume discounts used in the determination of rebates; however, virtually all volume discounts are calculated and recorded on a monthly basis. Transaction and clearing fees, as well as any volume discounts rebated to our customers, are calculated and billed monthly in accordance with our published fee schedules. We make liquidity payments to certain customers in our NYSE businesses and recognize those payments as a cost of revenue. In addition, we pay NYSE regulatory oversight fees to the SEC and collect equal amounts from our customers. These are also considered a cost of revenue, and both of these NYSE-related fees are included in transaction-based expenses. Transaction and clearing revenues and the related transaction-based expenses are all recognized in our Trading and Clearing segment.

Data services - Data service revenuesrepresent the following:


◦	Pricing and analytics services consist of an extensive set of independent continuous and end-of-day evaluated pricing services focused primarily on fixed income and international equity securities, valuation services, reference data, index services and multi-asset class portfolio and risk management analytics.


◦	Desktops and connectivity services comprise hosting, colocation, infrastructure, technology-based information platforms, feeds and connectivity solutions through the ICE Global Network.


◦	Exchange data services represent subscription fees for the provision of our market data that is created from activity in our Trading and Clearing segment.

The nature and timing of each contract type for the data services above are similar in nature. Data services revenues are primarily subscription-based, billed monthly, quarterly or annually in advance and recognized ratably over time as our performance obligations of data delivery are met consistently throughout the period. Because these contracts primarily consist of single performance obligations with fixed prices, there is no variable consideration and no need to allocate the transaction price. In certain of our data contracts, where third parties are involved, we arrange for the third party to transfer the services to our customers. In these arrangements we are acting as an agent and revenue is recorded net. All data services fees are included in our Data and Listings segment.

Listings - Listings revenues include original and annual listing fees, and other corporate action fees. Under ASC 606, each distinct listing fee is allocated to multiple performance obligations including original and incremental listing and investor relations services, as well as a customer’s material right to renew the option to list on our exchanges. In performing this allocation, the standalone selling price of the listing services is based on the original and annual listing fees and the standalone selling price of the investor relation services is based on its market value. All listings fees are billed upfront and the identified performance obligations are satisfied over time. Upon our adoption of the ASC 606 framework, the amount of revenue related to the investor relations performance obligation is recognized ratably over a two-year period, with the remaining revenue recognized ratably over time as customers continue to list on our exchanges, which is generally estimated to be over a period of up to nine years for NYSE and up to five years for NYSE Arca and NYSE American. Listings fees related to other corporate actions are considered contract modifications of our listing contracts and are recognized ratably over time as customers continue to list on our exchanges, which is generally estimated to be a period of six years for NYSE and three years for NYSE Arca and NYSE American. All listings fees are recognized in our Data and Listings segment.

Other revenues - Other revenuesprimarily include interest income on certain clearing margin deposits, regulatory penalties and fines, fees for use of our facilities, regulatory fees charged to member organizations of our U.S. securities exchanges, designated market maker service fees, exchange membership fees and agricultural grading and certification fees. Generally, fees for other revenues contain one performance obligation. Because these contracts primarily consist of single performance obligations with fixed prices, there is no variable consideration and no need to allocate the transaction price. Services for other revenues are primarily satisfied at a point in time. Therefore, there is no need to allocate the fee and no deferral results as we have no further obligation to the customer at that time. Other revenues are recognized in our Trading and Clearing segment.

The following table depicts the disaggregation of our revenue according to business line and segment (in millions). Segment totals are consistent with the segment totals in Note 13:



	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Six months ended June 30, 2018
Transaction and clearing, net	$	1,762	$	—	$	1,762
Data services	—		1,046		1,046
Listings	—		220		220
Other revenues	108		—		108
Total revenues	1,870		1,266		3,136
Transaction-based expenses	665		—		665
Total revenues, less transaction-based expenses	$	1,205	$	1,266	$	2,471

Timing of Revenue Recognition
Services transferred at a point in time	$	1,030	$	—	$	1,030
Services transferred over time	175		1,266		1,441
Total revenues, less transaction-based expenses	$	1,205	$	1,266	$	2,471



	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Six months ended June 30, 2017
Transaction and clearing, net	$	1,615	$	—	$	1,615
Data services	—		1,041		1,041
Listings	—		217		217
Other revenues	94		—		94
Total revenues	1,709		1,258		2,967
Transaction-based expenses	621		—		621
Total revenues, less transaction-based expenses	$	1,088	$	1,258	$	2,346

Timing of Revenue Recognition
Services transferred at a point in time	$	928	$	—	$	928
Services transferred over time	160		1,258		1,418
Total revenues, less transaction-based expenses	$	1,088	$	1,258	$	2,346



	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Three months ended June 30, 2018
Transaction and clearing, net	$	864	$	—	$	864
Data services	—		526		526
Listings	—		111		111
Other revenues	55		—		55
Total revenues	919		637		1,556
Transaction-based expenses	310		—		310
Total revenues, less transaction-based expenses	$	609	$	637	$	1,246

Timing of Revenue Recognition
Services transferred at a point in time	$	521	$	—	$	521
Services transferred over time	88		637		725
Total revenues, less transaction-based expenses	$	609	$	637	$	1,246



	Trading and Clearing Segment		Data and Listings Segment		Total Consolidated
Three months ended June 30, 2017
Transaction and clearing, net	$	817	$	—	$	817
Data services	—		521		521
Listings	—		109		109
Other revenues	49		—		49
Total revenues	866		630		1,496
Transaction-based expenses	316		—		316
Total revenues, less transaction-based expenses	$	550	$	630	$	1,180

Timing of Revenue Recognition
Services transferred at a point in time	$	470	$	—	$	470
Services transferred over time	80		630		710
Total revenues, less transaction-based expenses	$	550	$	630	$	1,180

The Trading and Clearing segment revenues above include $128 million and $116 million for the six months ended June 30, 2018 and 2017, respectively, and $65 million and $59 million for the three months ended June 30, 2018 and 2017, respectively, for services transferred over time related to risk management of open interest performance obligations. A majority of these performance obligations are performed over a short period of time of one month or less.


5.	Goodwill and Other Intangible Assets

The following is a summary of the activity in the goodwill balance for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 (in millions):

Goodwill balance at December 31, 2016 $ 12,291
Acquisitions (divestitures), net 1
Foreign currency translation 57
Reclassification to held for sale (331 )
Other activity, net (2 )
Goodwill balance at September 30, 2017 $ 12,016



Goodwill balance at December 31, 2017	$	12,216
Acquisitions	267
Foreign currency translation	(17		)
Other activity, net	18
Goodwill balance at June 30, 2018	$	12,484

The following is a summary of the activity in the other intangible assets balance for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 (in millions):

Other intangible assets balance at December 31, 2016 $ 10,420
Acquisitions (divestitures), net 5
Foreign currency translation 60
Reclassification to held for sale (214 )
Other activity, net (9 )
Amortization of other intangible assets (206 )
Other intangible assets balance at September 30, 2017 $ 10,056



Other intangible assets balance at December 31, 2017	$	10,269
Acquisitions	136
Foreign currency translation	(22		)
Amortization of other intangible assets	(142		)
Other activity, net	(18		)
Other intangible assets balance at June 30, 2018	$	10,223

We completed ~~the acquisitions~~our acquisition of ~~TMX Atrium and NYSE National and sold NYSE Governance Services and IDMS~~BondPoint during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 (Note 3)~~. We reclassified the net assets of Trayport, including the related goodwill and other intangible assets, and they are being recorded as held for sale as of September 30, 2017 (Note 10)~~. The foreign currency translation adjustments in the tables above result from a portion of our goodwill and other intangible assets being held at our U.K., EU and Canadian subsidiaries, ~~some of~~ whose functional currencies are not the U.S. dollar. The changes in other activity, net in the tables above primarily relate to adjustments to the fair value of the net tangible assets and ~~identifiable~~ intangible assets ~~and liabilities~~ relating to the acquisitions, with a corresponding adjustment to goodwill.

~~In August 2016, we sold certain~~ Amortization of ~~Creditex’s U.S. voice brokerage operations to Tullett Prebon. During~~other intangible assets in the third quarter of 2016, we discontinued Creditex’s U.K. voice brokerage operations. We continue to operate Creditex’s electronically traded markets and systems, post-trade connectivity platforms and intellectual property. Based on an analysis of these factors, it was determined that the carrying value of the Creditex customer relationship intangible asset was not fully recoverable andtable above includes an impairment charge of ~~the asset was~~$4 million recorded ~~in September 2016 for $33 million based on a discounted cash flow calculation. The impairment was recorded as amortization expense within our trading and clearing segment in~~during the ~~accompanying consolidated statements of income for the nine and~~ three months ended ~~September~~June 30, ~~2016.~~

~~Other than~~2018 on the ~~Creditex customer relationship~~remaining value of exchange registration intangible ~~asset impairment discussed above, we~~assets in connection with the July 2018 closure of ICE Futures Canada and ICE Clear Canada (Note 10). We did not recognize any other impairment losses on goodwill or other intangible assets during the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016.~~2017.


5.6.	Deferred Revenue

~~Deferred~~Our contract liabilities, or deferred revenue, ~~represents cash~~represent consideration received that is yet to be recognized as revenue. Total deferred revenue was ~~$366~~$464 million as of ~~September~~June 30, ~~2017,~~2018, including ~~$228~~$372 million in current deferred revenue and ~~$138~~$92 million in non-current deferred revenue. The

changes in our deferred revenue during the ~~nine~~six months ended ~~September~~June 30, 2018 are as follows (in millions), adjusted to reflect the adoption of ASC 606 as discussed in Note 2:



	Annual Listings Revenues			Original Listings Revenues			Other Listings Revenues			Data Services and Other Revenues			Total
Deferred revenue balance at December 31, 2017	$	—		$	25		$	98		$	93		$	216
Additions	383			13			26			230			652
Amortization	(191		)	(12		)	(17		)	(184		)	(404		)
Deferred revenue balance at June 30, 2018	$	192		$	26		$	107		$	139		$	464

The changes in our deferred revenue during the six months ended June 30, 2017 are as follows (in millions), adjusted to reflect the adoption of ASC 606 as discussed in Note 2:



	Annual Listings Revenues			Original Listings Revenues			Other Listings Revenues			Data Services and Other Revenues			Total
Deferred revenue balance at December 31, 2016	$	—		$	23		$	83		$	88		$	194
Additions	366			11			39			232			648
Amortization	(184		)	(11		)	(21		)	(186		)	(402		)
Divestitures	—			—			—			(10		)	(10		)
Deferred revenue balance at June 30, 2017	$	182		$	23		$	101		$	124		$	430

Adjustments for divestitures in the table above resulted from our June 2017 divestiture of NYSE Governance Services and our March 2017 divestiture of Interactive Data Managed Solutions, or IDMS, as well as our classification of Trayport deferred revenue as held for sale during the six months ended June 30, 2017. Included in the amortization recognized for the six months ended June 30, 2018, $77 million relates to the deferred revenue balance as of January 1, 2018. Included in the amortization recognized for the six months ended June 30, 2017, $79 million relates to the deferred revenue balance as of January 1, 2017. As of

June 30, 2018, we estimate that our deferred revenue will be recognized in the following years (in millions):

Annual Listings Revenue Original Listings Revenues Other Listings Revenues Data Services and Other Revenues Total
Deferred revenue balance at December 31, 2016 $ —
$ 66
$ 83
$ 88
$ 237
Additions 367
17
49
345
778
Amortization (276 ) (8 ) (31 ) (324 ) (639 )
Less NYSE Governance Services, IDMS and Trayport (Notes 3 and 10) —
—
—
(10 ) (10 )
Deferred revenue balance at September 30, 2017 $ 91
$ 75
$ 101
$ 99
$ 366



	Annual Listings Revenues		Original Listing Revenues		Other Listing Revenues		Data Services and Other Revenues		Total
Remainder of 2018	$	192	$	13	$	10	$	115	$	330
2019	—		12		34		20		66
2020	—		1		27		2		30
2021	—		—		19		2		21
2022	—		—		13		—		13
Thereafter	—		—		4		—		4
Total	$	192	$	26	$	107	$	139	$	464


6.7.	Debt

Our total debt, including short-term and long-term debt, consisted of the following as of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016~~2017 (in millions):


	As of September 30, 2017		As of December 31, 2016		As of June 30, 2018		As of December 31, 2017
Debt:
Short-term debt:
Commercial Paper	$	1,197	$	1,642	$	2,045	$	1,233
NYSE Notes (2.00% senior unsecured notes due October 5, 2017)	—		851
Short-term debt	1,197		2,493
2018 Senior Notes (2.50% senior unsecured notes due October 15, 2018)	599		598		600		600
Total short-term debt					2,645		1,833
Long-term debt:
2020 Senior Notes (2.75% senior unsecured notes due December 1, 2020)	1,243		1,242		1,245		1,244
2022 Senior Notes (2.35% senior unsecured notes due September 15, 2022)	495		—		496		495
2023 Senior Notes (4.00% senior unsecured notes due October 15, 2023)	791		790		792		791
2025 Senior Notes (3.75% senior unsecured notes due December 1, 2025)	1,242		1,241		1,243		1,242
2027 Senior Notes (3.10% senior unsecured notes due September 15, 2027)	495		—		495		495
Long-term debt	4,865		3,871
Total long-term debt					4,271		4,267
Total debt	$	6,062	$	6,364	$	6,916	$	6,100

~~Amended~~ Credit Facility

We ~~had previously entered into~~have a $3.4 billion senior unsecured revolving credit facility, or the Credit Facility, ~~which was scheduled to end on November 13, 2020. On August 18, 2017, we agreed~~ with ~~the lenders, amongst other items, to extend the~~a maturity date toof August 18, 2022, ~~herein referred~~pursuant to a credit agreement with Wells Fargo Bank, N.A., as primary administrative agent, issuing lender and swing-line lender, Bank of America, N.A., as syndication agent, backup administrative agent and swing-line lender, and the ~~Amended Credit Facility.~~lenders party thereto. The ~~Amended~~ Credit Facility includes an option for us to propose an increase in the aggregate amount available for borrowing by up to $975 million, subject to the consent of the lenders funding the increase and certain other conditions. ~~The commitments available under the Amended Credit Facility are scheduled to reduce to $3.2 billion on November 13, 2020.~~

Other amendments within the Amended Credit Facility include, but are not limited to, (i) eliminating the step-up in the commitment fee ratings-based grid that was scheduled to take effect in April 2019, (ii) removing ICE Europe Parent Limited as a party to the credit agreement, (iii) removing the guaranty by ICE in respect of ICE Europe Parent Limited, (iv) increasing the maximum leverage ratio to 3.50:1.00, and (v) up to two times, increasing the maximum leverage ratio from 3.50:1.00 to 4.00:1.00 for a period of one year following a material acquisition.

No amounts were outstanding under the ~~Amended~~ Credit Facility as of ~~September~~June 30, ~~2017. We incurred debt issuance costs~~2018. As of ~~$5 million relating to the Amended Credit Facility and they are presented in the accompanying consolidated balance sheet as other non-current assets and will be amortized over the life~~June 30, 2018, of ~~the Amended Credit Facility.~~

Of the $3.4 billion that is currently available for borrowing under the ~~Amended~~ Credit Facility, ~~$1.2~~$2.0 billion is required to back-stop the amount outstanding under our Commercial Paper Program ~~as of September 30, 2017.~~ and $105 million is required to support certain broker-dealer subsidiary commitments.

The amount required to back-stop the amounts outstanding under the Commercial Paper Program will fluctuate as we increase or decrease our commercial paper borrowings. The remaining ~~$2.2~~$1.3 billion available under the ~~Amended~~ Credit Facility as of ~~September~~June 30, ~~2017~~2018 is available to us to use for working capital and general corporate purposes including, but not limited to, acting as a back-stop to future increases in the amounts outstanding under the Commercial Paper Program.

~~Senior Notes~~

We incurred debt issuance costs of $8 million relating to the issuance of the 2022 Senior Notes and the 2027 Senior Notes and they are presented in the accompanying consolidated balance sheet as a deduction from the carrying amount of the related debt liability and will be amortized over the life of the 2022 Senior Notes and the 2027 Senior Notes. The 2022 Senior Notes and 2027 Senior Notes contain affirmative and negative covenants, including, but not limited to, certain redemption rights, limitations on liens and indebtedness and limitations on certain mergers, sales, dispositions and lease-back transactions.

Commercial Paper Program

We have entered into a U.S. dollar commercial paper program, or the Commercial Paper Program. Our Commercial Paper Program is currently backed by the borrowing capacity available under the ~~Amended~~ Credit Facility, equal to the amount of the commercial paper that is issued and outstanding at any given point in time. The effective interest rate of commercial paper issuances does not materially differ from ~~short term~~short-term interest rates (such as USD LIBOR). The fluctuation of these rates due to market conditions may impact our interest expense. During the six months ended June 30, 2018, we used net proceeds of $812 million from notes issued

under our Commercial Paper Program primarily to finance the acquisition of BondPoint, to purchase an additional 5.1% stake in Euroclear, and for general corporate purposes.

Commercial paper notes of ~~$1.2~~$2.0 billion with original maturities ranging from 2two to 7572 days were outstanding as of ~~September~~June 30, ~~2017~~2018 under our Commercial Paper Program. As of ~~September~~June 30, ~~2017,~~2018, the weighted average interest rate on the ~~$1.2~~$2.0 billion outstanding under our Commercial Paper Program was ~~1.23%~~2.06% per annum, with a weighted average maturity of 29eighteen days.

2018 Senior Notes

We ~~repaid $445~~have $600 million of senior notes due in October 2018 and we currently plan to fund the ~~amounts outstanding~~redemption of these notes with the issuance of new senior term notes. However, if we are unable to issue new senior term notes or to do so on favorable terms, then we would fund the redemption of the notes under the Commercial Paper Program ~~during~~or with the ~~nine months ended September 30, 2017 primarily using net cash proceeds received from~~unused amount available under the ~~sale of our investment in Cetip (Note 11) and~~Credit Facility or with cash flows from ~~operations.~~

~~NYSE Notes~~

~~The $850 million, 2.00% senior unsecured fixed rate NYSE Notes were due in October 2017. We paid off the NYSE Notes in September 2017 using the majority~~operations, or a combination of ~~the proceeds from the 2022 Senior Notes and 2027 Senior Notes offering.~~

We previously provided condensed consolidating financial statements for Intercontinental Exchange, Inc., or ICE (Parent), NYSE Holdings LLC and the subsidiary non-guarantors in a footnote to our consolidated financial statements. However, in connection with the NYSE Notes being paid off in September 2017, all guarantees between ICE and NYSE Holdings LLC were terminated and we are no longer required to include a condensed consolidating financial statements footnote in our quarterly and annual filings.these sources.


7.8.	Equity

We currently sponsor employee and director stock option and restricted stock plans. Stock options and restricted stock are granted at the discretion of the ~~compensation committee~~Compensation Committee of the ~~board~~Board of ~~directors.~~Directors. All stock options and restricted stock awards are granted at an exercise price equal to the fair value of the common stock on the date of grant. The grant date fair value is based on the closing stock price on the date of grant. The fair value of the stock options and restricted stock on the date of grant is recognized as expense over the vesting period, net of ~~estimated~~ forfeitures. The non-cash compensation expenses recognized in our consolidated statements of income for stock options and restricted stock were ~~$102~~$61 million and ~~$90~~$68 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$34~~$32 million and ~~$30~~$34 million for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively.

Stock Option Plans

The following is a summary of stock ~~options~~option activity for the ~~nine~~six months ended ~~September~~June 30, ~~2017:~~2018:


	Number of Options		Weighted Average Exercise Price per Option		Number of Options		Weighted Average Exercise Price per Option
Outstanding at December 31, 2016	3,878,705		$	36.05
Outstanding at December 31, 2017					4,013,388		$	41.13
Granted	730,913		57.34		522,881		67.00
Exercised	(429,435	)	26.38		(432,087	)	28.69
Outstanding at September 30, 2017	4,180,183		40.77
Outstanding at June 30, 2018					4,104,182		45.73

Details of stock options outstanding as of ~~September~~June 30, ~~2017~~2018 are as follows:


	Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (In millions)		Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (Years)	Aggregate Intrinsic Value (In millions)
Vested or expected to vest	4,180,183	$	40.77	6.7	$	117	4,104,182	$	45.73	6.8	$	114
Exercisable	3,022,120	$	35.72	5.9	$	100	2,953,324	$	39.86	6.0	$	100

The total intrinsic value of stock options exercised ~~during~~was $19 million and $7 million for the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, respectively, and ~~2016 were $15~~$10 million and ~~$15 million, respectively, and $8 million and $5~~$4 million for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. As of ~~September~~June 30, ~~2017,~~2018, there were ~~$10~~$12 million in total unrecognized compensation costs related to stock options. These costs are expected to be recognized over a weighted average period of ~~1.8~~1.9 years as the stock options vest.

We use the Black-Scholes option pricing model for purposes of valuing stock option awards. During the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, we used the weighted-average assumptions in the table below to compute the value of all options for shares of common stock granted to employees:


	Nine Months Ended September 30,						Six Months Ended June 30,
Assumptions:	2017			2016			2018			2017
Risk-free interest rate	1.84		%	1.51		%	2.66		%	1.84		%
Expected life in years	5.0			5.0			6.0			5.0
Expected volatility	21		%	24		%	20		%	21		%
Expected dividend yield	1.40		%	1.36		%	1.43		%	1.40		%
Estimated weighted-average fair value of options granted per share	$	10.50		$	9.88		$	13.98		$	10.50

The risk-free interest rate is based on the zero-coupon U.S. Treasury yield curve in effect at the time of grant. The expected life computation is derived from historical exercise patterns and anticipated future patterns. Expected volatilities are based on historical volatility of our stock.

Restricted Stock Plans

In ~~January 2017,~~February 2018, we reserved a maximum of ~~1,534,218~~1,303,151 restricted shares for potential issuance as performance-based restricted shares to certain of our employees. The number of shares that will ultimately be granted under this award will be based on our actual financial performance as compared to financial performance targets set by our ~~board~~Board of ~~directors~~Directors and ~~compensation committee~~the Compensation Committee of the Board of Directors for the year ending December 31, ~~2017,~~2018, as well as our ~~2017~~2018 total ~~shareholder~~stockholder return, or TSR, as compared to that of the S&P 500 Index. The maximum compensation expense to be recognized under these performance-based restricted shares is ~~$85~~$84 million if the maximum financial performance target is met and all ~~1,534,218~~1,303,151 shares vest. The compensation expense to be recognized under these performance-based restricted shares will be $42 million if the target financial performance is met, which would result in ~~767,109~~651,576 shares vesting. We ~~will~~ recognize expense on an accelerated basis over the three-year vesting period based on our quarterly assessment of the probable ~~2017~~2018 actual financial performance as compared to the ~~2017~~2018 financial performance targets. As of ~~September~~June 30, ~~2017,~~2018, we determined that it is probable that the financial performance level will be at target for ~~2017.~~2018. Based on this assessment, we recorded non-cash compensation expense of ~~$18~~$11 million and $6$7 million for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, related to these shares and the remaining ~~$24~~$31 million in non-cash compensation expense will be recorded on an accelerated basis over the remaining vesting period, including $6$12 million of which will be recorded ~~during~~over the ~~fourth quarter~~remainder of ~~2017.~~2018.

The following is a summary of the non-vested restricted ~~shares~~share activity for the ~~nine~~six months ended ~~September~~June 30, ~~2017:~~2018:


	Number of Restricted Stock Shares	Weighted Average Grant-Date Fair Value per Share		Number of Restricted Stock Shares	Weighted Average Grant-Date Fair Value per Share
Non-vested at December 31, 2016	6,435,871	$	45.33
Non-vested at December 31, 2017				5,748,408	$	52.78
Granted	3,186,709	57.28		1,829,220	67.47
Vested	(3,412,678)	44.59		(2,673,199)	49.86
Forfeited	(370,008)	51.65		(246,640)	57.59
Non-vested at September 30, 2017	5,839,894	52.47
Non-vested at June 30, 2018				4,657,789	59.97

Restricted stock shares granted in the table above include both time-based and performance-based grants. Performance-based shares have been presented to reflect the actual shares to be issued based on the achievement of past performance targets. Non-vested performance-based restricted shares granted are presented in the table above at the target number of restricted shares that would vest if the performance targets are met. As of ~~September~~June 30, ~~2017,~~2018, there were ~~$171~~$181 million in total unrecognized compensation costs related to the time-based restricted stock and the performance-based restricted stock. These costs are expected to be recognized over a

weighted-average period of 1.6 years as the restricted stock vests. These unrecognized compensation costs assume that a target performance level will be met on the performance-based restricted shares granted in ~~January 2017.~~February 2018. During the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, the total fair value of restricted stock vested under all restricted stock plans was ~~$199~~$195 million and ~~$120~~$203 million, respectively.

Employee Stock Purchase Plan

In May 2018, our stockholders approved our Employee Stock Purchase Plan, or ESPP, under which we have reserved and may sell up to 25,000,000 shares of our common stock to employees. The ESPP grants employees the right to acquire our stock in increments of 1% of eligible pay, with a maximum contribution of 25% of eligible pay, subject to applicable annual Internal Revenue Service limitations. Under our ESPP, employees are limited to $25,000 of common stock annually, or 1,250 shares of common stock each offering period. There will be two offering periods each year, which will run from January 1^st (or the first trading day thereafter) through June 30^th (or the first trading day prior to such date) and from July 1^st (or the first trading day thereafter) through December 31^st (or the first trading day prior to such date). The first offering period began on July 2, 2018 and will run through December 31, 2018. The purchase price per share of common stock will be 85% of the lesser of the fair market value of the stock on the first or the

last trading day of each offering period. Beginning in the third quarter of 2018, we will record compensation expense over the offering period related to the 15% discount that is given to our employees.

Stock Repurchase Program

In August 2016, our board of directors approved an aggregate of $1.0 billion for future repurchases of our common stock with no fixed expiration date, subject to applicable laws and regulations. The shares repurchased are held in treasury stock. As of September 30, 2017, the remaining board authorization permits repurchases of up to $241 million of our common stock. In September 2017, our ~~board~~Board of ~~directors~~Directors approved an aggregate of $1.2 billion for future repurchases of our common stock with no fixed expiration date that ~~becomes~~became effective ~~as of~~on January 1, 2018. During the six months ended June 30, 2018, we repurchased 10,403,246 shares of our outstanding common stock at a cost of $759 million, excluding shares withheld upon vesting of equity awards. The shares repurchased are held in treasury stock and were completed on the open market and under our Rule 10b5-1 trading plan. The timing and extent of future repurchases, if any, will depend upon many conditions. Our management periodically reviews whether to be active in repurchasing our stock. In making a determination regarding any stock repurchases, we consider multiple factors. The factors may include: overall stock market conditions, our common stock price movements, the remaining amount authorized for repurchases by our Board of Directors, the potential impact of a stock repurchase program on our corporate debt ratings, our expected free cash flow and working capital needs, our current and future planned strategic growth initiatives, and other potential uses of our cash and capital resources.

As of June 30, 2018, up to $441 million remains from the board authorization for repurchases of our common stock. We expect funding for any ~~share~~stock repurchases to come from our operating cash flow or borrowings under our debt facilities or ~~commercial paper program.~~our Commercial Paper Program. Repurchases may be made from time to time on the open market, through established trading plans, in privately-negotiated transactions or otherwise in accordance with all applicable securities laws, rules and regulations. We have entered into a Rule 10b5-1 trading plan, as authorized by our ~~board~~Board of ~~directors,~~Directors, to govern some or all of the repurchases of our shares of common stock. We may discontinue the stock repurchases at any time and may amend or terminate the Rule 10b5-1 trading plan at any time. The approval of our ~~board~~Board of ~~directors~~Directors for the share repurchases does not obligate us to acquire any particular amount of our common stock. In addition, our ~~board~~Board of ~~directors~~Directors may increase or decrease the amount ~~of capacity we have~~available for repurchases from time to time.

During the nine months ended September 30, 2017, we repurchased 11,469,042 shares of our outstanding common stock at a cost of $709 million, excluding shares withheld upon vesting of equity awards. These repurchases were completed on the open market and under our 10b5-1 trading plan. The timing and extent of future repurchases that are not made pursuant to a Rule 10b5-1 trading plan will be at our discretion and will depend upon many conditions. Our management periodically reviews whether or not to be active in repurchasing our stock. In making a determination regarding any stock repurchases, we consider multiple factors. The factors may include: overall stock market conditions, our common stock price movements, the remaining amount authorized for repurchases by our board of directors, the potential impact of a stock repurchase program on our corporate debt ratings, our expected free cash flow and working capital needs, our current and future planned strategic growth initiatives, and other potential uses of our cash and capital resources.

Dividends

During the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, we paid cash dividends per share of ~~$0.60~~$0.48 and ~~$0.51,~~$0.40, respectively, for an aggregate payout of ~~$358~~$279 million and ~~$307~~$239 million, respectively. The declaration of dividends is subject to the discretion of our ~~board~~Board of ~~directors,~~Directors, and may be affected by various factors, including our future earnings, financial condition, capital requirements, levels of indebtedness, credit ratings and other considerations which our ~~board~~Board of ~~directors~~Directors deem relevant. Our ~~board~~Board of ~~directors~~Directors has adopted a quarterly dividend declaration policy providing that the declaration of any dividends will be determined quarterly by the ~~board~~Board of Directors or ~~audit committee~~the Audit Committee of the ~~board~~Board of ~~directors~~Directors taking into account such factors as our evolving business model, prevailing business conditions and our financial results and capital requirements, without a predetermined annual net income payout ratio.


8.9.	Income Taxes

Our effective tax rate was ~~29%~~24% and 27% for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~33%~~24% and ~~21%~~25% for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. The effective tax rates for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017 and 2016 were~~2018 are lower than the ~~federal statutory rate~~effective tax rates for the comparable periods in 2017 primarily due to ~~favorable foreign~~the enactment of the TCJA on December 22, 2017, which reduced the U.S. federal corporate income tax rate ~~differentials, deferred~~from 35% to 21%, effective January 1, 2018 (Note 2). That benefit is partially offset by additional U.S. federal and state income taxes on a portion of our non-U.S. income due to certain international tax ~~benefits~~provisions enacted as ~~a result~~part of ~~a U.K. income tax rate reduction enacted in~~ the ~~third quarter of 2016, and~~TCJA, as well as tax benefits associated with a divestiture in the ~~second quarter~~comparable periods in 2017.

We recorded our income tax provision based on the TCJA as enacted as of ~~2017, partially offset by~~June 30, 2018. We have also made reasonable estimates of the TCJA’s impact on state income ~~taxes including additional~~tax. Our estimates are based on the best available information as of June 30, 2018 and our interpretation of the TCJA and related state tax ~~expense from an Illinois corporate~~implications, as currently enacted. Our estimates do not include any potential federal or state administrative and/or legislative adjustments to certain provisions of the TCJA and related state provisions.

SAB 118 provides guidance for companies that have not completed their accounting for income tax ~~rate increase enacted~~effects of the TCJA, in the ~~third quarter~~period of ~~2017. Favorable foreign income~~enactment, allowing for a measurement period of up to one year after the enactment date to finalize the recording of the related tax ~~rate differentials result primarily from lower income tax rates in the U.K. and various other lower tax jurisdictions as compared to the income tax rates in the U.S.~~

~~The effective tax rate~~impacts. As of June 30, 2018, we have not completed our accounting for the ~~three months ended September~~tax effects of the enactment of the TJCA. We will continue to analyze the TCJA in order to finalize its enactment-date effects within the measurement period (Note 2).

As of June 30, ~~2017 is higher than~~2018, we have not adopted an accounting policy regarding the ~~effective tax rate for~~treatment of taxes due on future inclusion of non-U.S. income in U.S. taxable income under the ~~comparable period in 2016 primarily because of~~Global Intangible Low-Taxed Income provisions. Therefore, no deferred tax benefits from a U.K. corporate income tax reduction in the third quarter of 2016 and additional tax expense as a result of an Illinois corporate income tax rate increase enacted in the third quarter of 2017. The same U.K. and Illinois factors affect the effective tax rate comparison for the nine months ended September 30, 2017 and 2016. Additionally, the nine month effective tax rate difference is impacted by tax benefits associated with a divestiture during the second quarter of 2017, partially offset by an income tax expense increase duerelated to ~~a relatively higher U.S. mix of income.~~

~~Our non-U.S. subsidiaries had $4.3 billion in cumulative undistributed earnings~~these provisions has been recorded as of ~~September~~June 30, ~~2017. This amount represents~~2018. We will continue our analysis and will make an election within the ~~post-income tax earnings~~measurement period as provided for under U.S. GAAP adjusted for previously taxed income. The earnings from our non-U.S. subsidiaries are considered to be indefinitely reinvested. Accordingly, no provision for U.S. federal and state income taxes has been made in the accompanying consolidated financial statements. Further, a determination of the unrecognized deferred tax liability is notSAB 118.

practicable. Any future distribution by way of dividend of these non-U.S. earnings may subject us to both U.S. federal and state income taxes, as adjusted for non-U.S. tax credits, and withholding taxes payable to various non-U.S. countries.


9.10.	Clearing Organizations

We operate regulated central counterparty clearing houses for the settlement and clearance of derivative contracts. The clearing houses include ICE Clear Europe, ICE Clear Credit, ICE Clear ~~US,~~U.S., ICE Clear Canada (which ceased operations in July 2018 as discussed below), ICE Clear Netherlands, ~~and~~ ICE Clear Singapore and ICE NGX (referred to herein collectively as the “ICE Clearing Houses”).

ICE Clear Europe performs the clearing and settlement for all futures and options contracts traded through ICE Futures Europe and ICE Endex, for energy futures and options contracts trading through ICE Futures U.S., and for CDS contracts submitted for clearing in Europe.

ICE Clear Credit performs the clearing and settlement for CDS contracts submitted for clearing in North America.

ICE Clear USU.S. performs the clearing and settlement of agricultural, metals, currencies and financial futures and options contracts traded through ICE Futures U.S.

ICE Clear Canada ~~performs~~performed the clearing and settlement for all futures and options contracts traded through ICE Futures ~~Canada.~~Canada until July 30, 2018, when we transitioned the trading and clearing of our canola contracts from ICE Futures Canada and ICE Clear Canada to ICE Futures U.S. and ICE Clear U.S., respectively. After the transition, ICE Futures Canada and ICE Clear Canada ceased operations.

ICE Clear Netherlands ~~offers~~has received regulatory approval to offer clearing ~~for~~of Dutch equity ~~options.~~options traded through ICE Endex.

ICE Clear Singapore performs the clearing and settlement for all futures and options contracts traded through ICE Futures Singapore.

ICE NGX performs clearing and settlement for physical North American natural gas, electricity and oil markets.

Each of the ICE Clearing Houses requires all clearing members or participants to maintain cash on deposit or pledge certain assets, which may include government obligations, non-government obligations, letters of credit or gold to ~~guarantee~~guaranty performance of the clearing members’ or participants’ open positions. Such amounts in total are known as “original ~~margin”.~~margin.” The ICE Clearing Houses may make intraday original margin calls in circumstances where market conditions require additional protection. The daily profits and losses from and to the ICE Clearing Houses due to the marking-to-market of open contracts are known as “variation ~~margin”. The~~margin.” With the exception of ICE NGX’s physical natural gas and physical power products, the ICE Clearing Houses mark all outstanding contracts to market, and therefore pay and collect variation margin, at least once daily, and in some cases multiple times throughout the day. For ICE NGX’s physical natural gas and power products, ICE NGX marks all outstanding contracts to market daily, but only collects variation margin when a participant’s open position falls outside a specified percentage of its pledged collateral. Marking-to-market allows the ICE Clearing Houses to identify any clearing members or participants that may be unable to satisfy the financial obligations resulting from changes in the prices of their open contracts before those financial obligations become exceptionally large and jeopardize the ability of the ICE Clearing Houses to ensure financial performance of clearing members’ or participants’ open positions.

~~Each~~With the exception of ICE NGX, each of the ICE Clearing Houses requires that each clearing member make deposits into a fund known as a “guaranty ~~fund”,~~fund,” which is maintained by the relevant ICE Clearing House. These amounts serve to secure the obligations of a clearing member to the ICE Clearing House to which it has made the guaranty fund deposit and may be used to cover losses sustained by the respective ICE Clearing House in the event of a default of a clearing member.

~~The~~ Because it is not our policy to guaranty credit facilities of our clearing houses which maintain contingent liquidity facilities secured by high quality liquid assets, we eliminated a $100 million guaranty that we had previously provided ICE ~~Clearing Houses seek to reduce their exposure through~~NGX in February 2018. As of June 30, 2018, ICE NGX maintains a risk management program that includes initial and ongoing financial standards for clearing member admission and continued membership, original and variation margin requirements, and mandatory deposits to the guaranty fund. The amounts that the clearing members are required to maintain in the original margin and guaranty fund ~~accounts are determined~~utilizing a $100 million letter of credit that has been entered into with a major Canadian chartered bank and backed by ~~standardized parameters established~~a default insurance policy underwritten by the risk management departments and reviewed by the risk committees and the boards of directors of each of the ICE Clearing Houses and may fluctuate over time. As of September 30, 2017 and December 31, 2016, the ICE Clearing Houses have receivedExport Development Corporation, or have been pledged $91.6 billion and $95.7 billion, respectively, in cash and non-cash collateral in original margin and guaranty fund deposits to cover price movements of underlying contracts for both periods. The ICE Clearing Houses also have powers of assessment that provide the ability to collect additional funds from their clearing members to coverEDC, a ~~defaulting member’s remaining obligations up to the limits established under the respective rules of each ICE Clearing House.~~

Should a particular clearing member fail to deposit original margin, or fail to make a variation margin payment, when and as required, the relevant ICE Clearing House may liquidate or hedge the clearing member’s open positions and use the clearing member’s original margin and guaranty fund deposits to make up any amount owed.Canadian government agency. In the event ~~that those deposits are not sufficient to~~of a participant default, where a participant’s collateral becomes depleted, the remaining shortfall would be covered by a draw down on the letter of credit following which ICE NGX would pay the ~~amount owed~~first $15 million in ~~full,~~losses per its deductible and recover additional losses under the ~~ICE Clearing Houses may utilize the respective guaranty fund deposits~~insurance policy of ~~their respective clearing members on a pro-rata basis for that purpose.~~up to $100 million.

We have contributed cash of $150 million, $50 million and $50 million to the guaranty funds of ICE Clear Europe, ICE Clear Credit and ICE Clear ~~US,~~U.S., respectively, as of ~~September~~June 30, ~~2017,~~2018, and such amounts are at risk and could be used in the event of a clearing member default where the amount of the defaulting clearing member’s original margin and guaranty fund deposits are insufficient. We have also contributed $4 million in cash in total to the guaranty funds of ICE Clear Canada, ICE Clear Netherlands and ICE Clear Singapore. The $254 million combined contributions to the guaranty funds as of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016~~2017 are included in long-term restricted cash and cash equivalents in the accompanying consolidated balance sheets.

In addition, beginning in March 2018, certain of our exchanges are now required to make similar contributions to those made by the clearing houses to be utilized pro rata along with the clearing contributions in the event of clearing member default. The contribution is calculated per exchange based on average guaranty fund contributions, subject to a minimum contribution of $10

million for each exchange. As of June 30, 2018, ICE Futures Europe, ICE Futures U.S. and our ICE Endex exchanges have contributed a combined $67 million in cash to the guaranty funds of ICE Clear Europe and ICE Clear U.S. These contributions are also included in long-term restricted cash and cash equivalents in the accompanying consolidated balance sheet.

The ICE Clearing Houses seek to reduce their exposure through a risk management program that includes initial and ongoing financial standards for clearing member and participant admission and continued membership, original and variation margin and collateral requirements, and mandatory deposits to the guaranty fund. The amounts that the clearing members and participants are required to maintain in the original margin, guaranty fund and collateral accounts are determined by standardized parameters established by the risk management department of the respective ICE Clearing House and reviewed by the risk committees and the boards of directors of each of the ICE Clearing Houses and may fluctuate over time. As of June 30, 2018 and December 31, 2017, the ICE Clearing Houses have received or have been pledged $102.2 billion and $92.6 billion, respectively, in cash and non-cash collateral in original margin and guaranty fund deposits to cover price movements of underlying contracts for both periods. With the exception of ICE NGX, the ICE Clearing Houses also have the ability to collect additional funds from their clearing members to cover a defaulting member’s remaining obligations up to the limits established under the respective rules of each ICE Clearing House.

Should a particular clearing member or participant fail to deposit original margin, provide collateral, or fail to make a variation margin payment, when and as required, the relevant ICE Clearing House may liquidate or hedge the clearing member’s or participant’s open positions and use their original margin and guaranty fund deposits to make up any amount owed. In the event that those deposits are not sufficient to pay the amount owed in full, the ICE Clearing Houses may utilize the respective guaranty fund deposits of their respective clearing members on a pro-rata basis for that purpose.

ICE NGX administers the physical delivery of energy trading contracts. It has an equal and offsetting claim to and from the respective participants on opposite sides of the physically settled contract. The balance related to delivered but unpaid contracts is reflected as a delivery contract net receivable with an offsetting delivery contract net payable in the accompanying consolidated balance sheets. ICE NGX also records unsettled variation margin equal to the fair value of open energy trading contracts as of the balance sheet date. Fair value is determined based on the difference between the trade price when the contract was entered into and the settlement price and is considered a Level 2 fair value measurement. There is no impact to the consolidated statements of income for either delivery contracts receivable/payable and unsettled variation margin, as an equivalent amount is recognized in both the assets and liabilities.

As of ~~September~~June 30, ~~2017,~~2018, our cash and cash equivalents margin deposits, ~~and~~unsettled variation margin, guaranty fund ~~were~~and delivery contracts receivable/payable, net, are as follows for the ICE Clearing Houses (in millions):


	ICE Clear Europe		ICE Clear Credit		ICE Clear US		Other ICE Clearing Houses		Total		ICE Clear Europe		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Other ICE Clearing Houses		Total
Original margin	$	20,686	$	21,911	$	4,004	$	103	$	46,704	$	22,193	$	19,655	$	6,148	$	—	$	93	$	48,089
Unsettled variation margin, net											—		—		—		90		—		90
Guaranty fund	3,025		2,345		305		22		5,697		3,565		2,300		473		—		21		6,359
Delivery contracts receivable/payable, net											—		—		—		453		—		453
Total	$	23,711	$	24,256	$	4,309	$	125	$	52,401	$	25,758	$	21,955	$	6,621	$	543	$	114	$	54,991

As of December 31, ~~2016,~~2017, our cash margin deposits, ~~and~~unsettled variation margin, guaranty fund and delivery contracts receivable/payable, net, were as follows for the ICE Clearing Houses (in millions):


	ICE Clear Europe		ICE Clear Credit		ICE Clear US		Other ICE Clearing Houses		Total		ICE Clear Europe		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Other ICE Clearing Houses		Total
Original margin	$	27,046	$	16,833	$	6,184	$	107	$	50,170	$	19,792	$	20,703	$	3,898	$	—	$	126	$	44,519
Unsettled variation margin, net											—		—		—		227		1		228
Guaranty fund	2,444		2,135		316		85		4,980		3,037		2,607		299		—		23		5,966
Delivery contracts receivable/payable, net											—		—		—		509		—		509
Total	$	29,490	$	18,968	$	6,500	$	192	$	55,150	$	22,829	$	23,310	$	4,197	$	736	$	150	$	51,222

We have recorded these cash and cash equivalent deposits and amounts due in the accompanying consolidated balance sheets as current assets with corresponding current liabilities to the clearing members of the relevant ICE Clearing House. All cash, securities and ~~securities~~amounts due are available only to meet the financial obligations of that clearing member to the relevant ICE Clearing House. ICE Clear Europe, ICE Clear Credit, ICE Clear ~~US,~~U.S., ICE Clear Canada, ICE Clear Netherlands, ICE NGX and ICE Clear Singapore are separate legal entities and are not subject to the liabilities of the other ICE Clearing Houses or the

obligations of the members of the other ICE Clearing Houses. The amount of these cash deposits may fluctuate due to the types of margin collateral choices available to clearing members and the change in the amount of deposits required. As a result, these assets and corresponding liabilities may vary significantly over time.

Of the cash held by the ICE Clearing Houses, as of ~~September~~June 30, ~~2017, $28.3~~2018, $33.0 billion is secured in reverse repurchase agreements with primarily overnight maturities or direct investment in government securities. ICE Clear Credit, as a systemically important financial market utility, or SIFMU, as designated by the Financial Stability Oversight Council, or FSOC, held ~~$19.7~~$17.1 billion of its U.S. dollar cash in the guaranty fund and in original margin in cash accounts at the Federal Reserve Bank of Chicago as of ~~September~~June 30, ~~2017. During the quarter ended September 30, 2017,~~2018. ICE Clear Europe ~~established~~maintains a ~~Euro denominated~~Euro-denominated account at the De Nederlandsche Bank, or DNB, the central bank of the ~~Netherlands. This~~Netherlands, as well as a pounds sterling-denominated account ~~provides~~at the Bank of England, or BOE, the central bank of the U.K. These accounts provide the flexibility for ICE Clear Europe to place ~~Euro denominated~~Euro- and pounds sterling-denominated cash margin securely at a national ~~bank,~~banks, in particular during periods when liquidity in the Euro and pounds sterling repo markets may temporarily become ~~contracted, such as over a quarter or year end.~~contracted. As of ~~September~~June 30, ~~2017,~~2018, ICE Clear Europe held ~~$1.5 billion~~€686 million ($802 million based on the euro/U.S. dollar exchange rate of 1.1684 as of June 30, 2018) at ~~DNB.~~DNB, and £500 million ($660 million based on the pound sterling/U.S. dollar exchange rate of 1.3208 as of June 30, 2018) at the BOE. The remaining cash deposits at the ICE Clearing Houses are held in demand deposit accounts at large, highly rated financial institutions and ~~directly~~direct investments primarily in U.S. Treasury securities with original maturities of less than ~~12 months.~~three months, plus certain U.S. Treasury securities that extend beyond twelve months which we consider to be Level 1 securities. The carrying value of these securities with original maturities of less than three months approximates their fair value due to the short-term nature of the instruments and repurchase agreements.

In addition to the cash deposits for original margin and the guaranty fund, the ICE Clearing Houses have also received other assets from clearing members, which include government obligations, and may include other non-cash collateral such as certain agency and corporate debt, letters of credit or gold to mitigate credit risk. These assets are not reflected in the accompanying consolidated balance sheets as the risks and rewards of these assets remain with the clearing members unless the ICE Clearing Houses have sold or re-pledged the assets or in the event of a clearing member default, where the clearing member is no longer entitled to redeem the assets. Any income, gain or loss accrues to the clearing member. For certain non-cash deposits, the ICE Clearing Houses may impose discount or “haircut” rates to ensure adequate collateral levels to account for fluctuations in the market value of these deposits.

ICE NGX requires participants to maintain cash or letters of credit to serve as collateral in the event of a participant default. The cash is maintained in a segregated bank account that is subject to a collateral agreement between the bank and ICE NGX. Per the agreement, ICE NGX serves in the capacity of a trustee. The cash is held by ICE NGX in trust for and on behalf of the participant; however, the cash remains the property of the participant and may only be accessed by ICE NGX if there is evidence of default. The rules governing when the cash can be accessed by ICE NGX are listed in the Contracting Party Agreement, a standardized agreement signed by each participant that also allows for netting of positive and negative exposure. Since the cash is held in trust and remains the property of the participant, it is not included in the accompanying consolidated balance sheets.

As of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, the assets pledged by the clearing members as original margin, which includes cash deposits held in trust at ICE NGX, and non-cash collateral guaranty fund deposits for each of the ICE Clearing Houses not included in the accompanying consolidated balance sheets are detailed below (in millions):

As of September 30, 2017 As of December 31, 2016

ICE Clear
Europe
ICE Clear Credit ICE Clear US Other ICE Clearing Houses
ICE Clear
Europe
ICE Clear Credit ICE Clear US Other ICE Clearing Houses
Original margin:
Government securities at face value $ 24,611
$ 4,339
$ 9,738
$ 24
$ 22,961
$ 6,013
$ 10,542
$ 37
Other —
—
—
—
—
—
—
368
Total $ 24,611
$ 4,339
$ 9,738
$ 24
$ 22,961
$ 6,013
$ 10,542
$ 405
Guaranty fund:
Government securities at face value $ 305
$ 42
$ 160
$ 2
$ 217
$ 178
$ 147
$ 40


~~10.~~	~~Held for Sale~~

On December 11, 2015, we acquired 100% of Trayport in a stock transaction. The total purchase price was $620 million, comprised of 12.6 million shares of our common stock. Trayport is a software company that licenses its technology to serve exchanges, OTC brokers and traders to facilitate electronic and hybrid trade execution primarily in the energy markets.

The U.K. Competition and Markets Authority, or the CMA, undertook a review of our acquisition of Trayport under the merger control laws of the U.K. In October 2016, the CMA issued its findings and ordered a divestment of Trayport to remedy what the CMA determined to be a substantial lessening of competition. In November 2016, we filed an appeal with the Competition Appeal Tribunal, or the CAT, to challenge the CMA’s decision. In March 2017, the CAT upheld the CMA decision that we should divest Trayport. Following the CAT’s judgment, we asked for leave to appeal the CAT’s decision at the U.K. Court of Appeals. In May 2017, the U.K. Court of Appeals denied our request for leave to appeal. We are obligated to sell Trayport by January 2018.

The functional currency of Trayport is the pound sterling, as this is the currency in which Trayport operates. The $620 million in Trayport net assets were recorded on our December 11, 2015 opening balance sheet at a pound sterling/U.S. dollar exchange rate of 1.5218 (£407 million). Because our consolidated financial statements are presented in U.S. dollars, we must translate the Trayport net assets into U.S. dollars at the exchange rates in effect at the end of each reporting period. Therefore, increases or decreases in the value of the U.S. dollar against the pound sterling will affect the value of the Trayport balance sheet, with gains or losses included in the cumulative translation adjustment account, a component of equity. As a result of the decrease in the pounds sterling/U.S. dollar exchange rate to 1.3398 as of September 30, 2017, the portion of our equity attributable to the Trayport net assets in accumulated other comprehensive loss from foreign currency translation was $74 million as of September 30, 2017.

As of June 30, 2017, we classified Trayport as held for sale and ceased depreciation and amortization of the property and equipment and other intangible assets (Note 2). As of September 30, 2017, the adjusted carrying value of Trayport’s net assets is $609 million, which is equal to the $535 million carrying value plus the $74 million in accumulated other comprehensive loss from foreign currency translation.

On October 27, 2017, we entered into a definitive agreement to sell Trayport to TMX Group for £550 million ($722 million based on the pounds sterling/U.S. dollar exchange rate of 1.3129 as of October 27, 2017). The proceeds of such sale will include a combination of cash and our acquisitions of Natural Gas Exchange, Inc., or NGX, and Shorcan Energy Brokers Inc., or Shorcan Energy, both wholly-owned subsidiaries of TMX Group. NGX, headquartered in Calgary, provides electronic trading, central counterparty clearing and data services to the North American natural gas, electricity and oil markets. Shorcan Energy offers brokerage services for the North American crude oil markets. If regulatory approval for the acquisitions of NGX and Shorcan Energy is not received within the required time to complete the sale of Trayport, then the sale of Trayport will proceed for cash consideration in the amount of £550 million and we would have one year from the signing date to close on the acquisitions of NGX and Shorcan Energy for cash consideration payable to TMX Group. We will recognize a gain on the closing of this transaction, equal to the gross proceeds received from TMX Group, less the adjusted carrying value and the costs to sell Trayport.

Trayport is included in our data and listings segment. The total assets held for sale as of September 30, 2017 were $595 million and were reclassified and are included in “prepaid expenses and other current assets” in our accompanying consolidated balance sheet and the total liabilities held for sale as of September 30, 2017 were $60 million and were reclassified and are included in “other current liabilities” in our accompanying consolidated balance sheet. The carrying amounts of the major classes of assets and liabilities of Trayport are as follows as of September 30, 2017 (in millions):



	As of June 30, 2018
	ICE Clear Europe		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Other ICE Clearing Houses
Original margin:
Government securities at face value	$	24,235	$	11,568	$	8,607	$	—	$	25
Letters of credit	—		—		—		1,610		—
ICE NGX cash deposits	—		—		—		281		—
Total	$	24,235	$	11,568	$	8,607	$	1,891	$	25
Guaranty fund:
Government securities at face value	$	431	$	169	$	234	$	—	$	3

Assets held for sale:
Cash and cash equivalents $ 5
Goodwill 341
Other intangibles, net 220
Other current and non-current assets 29
Total assets held for sale (included in prepaid expenses and other current assets) $ 595

Liabilities held for sale:
Deferred tax liabilities, net $ 39
Other current and non-current liabilities 21
Total liabilities held for sale (included in other current liabilities) $ 60

Accumulated other comprehensive loss from foreign currency translation classified as held for sale in equity $ 74



	As of December 31, 2017
	ICE Clear Europe		ICE Clear Credit		ICE Clear U.S.		ICE NGX		Other ICE Clearing Houses
Original margin:
Government securities at face value	$	23,496	$	5,699	$	9,581	$	—	$	18
Letters of credit	—		—		—		1,663		—
ICE NGX cash deposits	—		—		—		233		—
Total	$	23,496	$	5,699	$	9,581	$	1,896	$	18
Guaranty fund:
Government securities at face value	$	323	$	176	$	169	$	—	$	2


~~11.~~	~~Fair Value Measurements~~

11. Legal Proceedings

We are subject to legal proceedings, claims and investigations that arise in the ordinary course of our business. These include the matters described in Part I, Item 3 “Legal Proceedings” and Note 14 to the consolidated financial statements in Part II, Item 8 of our 2017 Form 10-K. We establish accruals for those matters in circumstances when a loss contingency is considered probable and the related amount is reasonably estimable. Any such accruals may be adjusted as circumstances change. Assessments of losses are inherently subjective and involve unpredictable factors. We do not believe that the resolution of these legal matters, including the matters described below, will have a material adverse effect on our consolidated financial condition, results of operations, or liquidity. It is possible, however, that future results of operations for any particular quarterly or annual period could be materially and adversely affected by any developments relating to the legal proceedings, claims and investigations.

During the year ended December 31, 2017, we recorded an aggregate of $14 million in expense accruals relating to SEC investigations and inquiries. On March 6, 2018, NYSE and affiliated exchanges reached a settlement with the SEC of the various matters under investigation and agreed to pay a $14 million civil monetary penalty, together with certain non-monetary relief. For further details about the settlement and underlying matters that were under investigation, please refer to Order Instituting Administrative and Cease-and-Desist Proceedings Pursuant to Section 8A of the Securities Act of 1933, Sections 19(h)(1) and 21C of the Securities Exchange Act of 1934, Making Findings, and Imposing Remedial Sanctions and a Cease-and-Desist Order, Administrative Proceeding File No. 3-18388 (In the Matter of New York Stock Exchange LLC, NYSE American LLC, and NYSE Arca, Inc.) entered into on March 6, 2018.

Our 2017 Form 10-K included a description of the purported class action lawsuit against two of our subsidiary NYSE exchanges, and other U.S. exchanges, by the City of Providence, Rhode Island and other plaintiffs. As reported in our 2017 Form 10-K, the defendant exchanges filed a petition for rehearing and/or rehearing en banc of the U.S. Court of Appeals for the Second Circuit’s, or Second Circuit, December 2017 decision vacating the dismissal of this case, and on March 13, 2018, the Second Circuit denied our petition. On or before August 10, 2018, the defendant exchanges intend to file a petition in the U.S. Supreme Court seeking review of the Second Circuit’s December 2017 decision.

12. Fair Value Measurements

Our financial instruments consist primarily of cash and cash equivalents, short-term and long-term restricted cash and ~~investments,~~cash equivalents, short-term ~~and long-term~~ investments, customer accounts receivable, margin deposits and guaranty funds, ~~cost and~~ equity ~~method~~ investments, short-term and long-term debt and certain other short-term assets and liabilities. The fair value of our financial instruments are measured based on a three-level hierarchy:

Level 1 inputs — quoted prices for identical assets or liabilities in active markets.

Level 2 inputs — observable inputs other than Level 1 inputs such as quoted prices for similar assets and liabilities in active markets or inputs other than quoted prices that are directly observable.

Level 3 inputs — unobservable inputs supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

We use Level 1 inputs to determine fair value. The Level 1 assets consist of U.S. Treasury ~~securities, equity~~ and other foreign government securities, ~~listed in active markets,~~ and investments in ~~publicly traded~~publicly-traded mutual funds held for the purpose of providing future payments of the supplemental executive retirement and the supplemental executive savings plans.

Financial assets and liabilities recorded in the accompanying consolidated balance sheets as of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016~~2017 are classified in their entirety based on the lowest level of input that is significant to the asset or liability’s fair value

measurement. Financial instruments measured at fair value on a recurring basis as of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016~~2017 are as follows (in millions):

As of September 30, 2017 As of December 31, 2016
Level 1 Level 2 and 3 Total Level 1 Level 2 and 3 Total
Assets at fair value:
Long-term investment in equity securities $ —
$ —
$ —
$ 432
$ —
$ 432
U.S. Treasury securities 734
—
734
500
—
500
Mutual Funds 16
—
16
23
—
23
Total assets at fair value $ 750
$ —
$ 750
$ 955
$ —
$ 955



	As of June 30, 2018						As of December 31, 2017
	Level 1		Level 2 and 3		Total		Level 1		Level 2 and 3		Total
Assets at fair value:
U.S. Treasury and other foreign government securities	$	944	$	—	$	944	$	734	$	—	$	734
Mutual funds	15		—		15		16		—		16
Total assets at fair value	$	959	$	—	$	959	$	750	$	—	$	750

As of June 30, 2018, we held $944 million in U.S. Treasury and other foreign government securities which are considered cash equivalents and for which the carrying amount approximates fair value. Of these securities, $677 million were recorded as short-term restricted cash and cash equivalents and $267 million were recorded as long-term restricted cash and cash equivalents in the accompanying consolidated balance sheet as of June 30, 2018.

Mutual funds are equity and fixed income mutual funds held for the purpose of providing future payments for the supplemental executive savings plan and the supplemental executive retirement plan and are classified as equity investments.

We did not use Level 2 or 3 inputs to determine the fair value of assets or liabilities measured at fair value on a recurring basis as of June 30, 2018 or December 31, 2017. We measure certain assets, such as intangible assets, at fair value on a non-recurring basis. These assets are recognized at fair value if they are deemed to be impaired. As of June 30, 2018, except for the fair value adjustment related to our $4 million impairment of exchange registration intangible assets associated with the closure of ICE Futures Canada (Note 5), none of our intangible assets were required to be recorded at fair value since no other impairments were recorded. Our equity investments without a readily determinable fair value, including our investments in Euroclear and Coinbase, are only measured at fair value on a non-recurring basis when a certain trigger event occurs in accordance with ASU 2016-01, as discussed in Notes 2 and 3. We did not have any investments measured at fair value on a non-recurring basis as of June 30, 2018.

As of ~~September~~June 30, ~~2017,~~2018, (i) the fair value of our $495 million 2027 Senior Notes was ~~$498~~$470 million, (ii) the fair value of our $1.24 billion 2025 Senior Notes was ~~$1.32~~$1.25 billion, (iii) the fair value of our ~~$791~~$792 million 2023 Senior Notes was ~~$851~~$812 million, (iv) the fair value of our ~~$495~~$496 million 2022 Senior Notes was ~~$499~~$480 million, (v) the fair value of our ~~$1.24~~$1.25 billion 2020 Senior Notes was ~~$1.28~~$1.24 billion, and (vi) the fair value of our ~~$599~~$600 million 2018 Senior Notes was ~~$604~~$599 million. The fair values of these fixed rate notes were estimated using quoted market prices for these instruments. The fair value of our commercial paper approximates the carrying value since the rates of interest on this short-term debt approximate market rates as of ~~September~~June 30, ~~2017~~2018. ~~All~~

Excluding our equity investments without a readily determinable fair value, all other financial instruments are determined to approximate carrying value due to the short period of time to their maturities.

Until March 29, 2017, we held a 12% ownership interest in Cetip, S.A., or Cetip, which we classified as an available-for-sale long-term investment. Cetip was recorded at its fair value using its quoted market price. Changes in the fair value of available-for-sale securities are reflected in accumulated other comprehensive income, and include the effects of both stock price and foreign currency

translation fluctuations. The unrealized holding gains and losses are excluded from earnings and reported in other comprehensive income until realized. Realized gains and losses, and declines in value deemed to be other-than-temporary, are recognized in earnings.

We acquired the common stock of Cetip for an aggregate consideration of $514 million in cash in July 2011. During the year ended December 31, 2013, we recognized an impairment loss on our Cetip investment of $190 million, primarily due to unfavorable foreign exchange rate changes, which was equal to the difference between the $324 million fair value as of December 31, 2013 and the original investment cost of $514 million. The $324 million fair value of the Cetip investment as of December 31, 2013 became our new cost basis. The long-term investment in equity securities as of December 31, 2016 represents our investment in Cetip, which was valued at $432 million, including a $108 million accumulated unrealized gain.

On March 29, 2017, Cetip and BM&FBOVESPA S.A. finalized a merger agreement. BM&FBOVESPA S.A., which changed its name to B3 S.A. - Brasil, Bolsa, Balcao, or B3, following the merger with Cetip, is a stock exchange and operator of registration, clearing, custodial and settlement services for equities, financial securities, indices, rates, commodities and currencies and is located in São Paulo, Brazil. The merger valued our Cetip investment at $500 million. We received the proceeds in cash and in B3 common stock.

The cash component was valued at $319 million, which was subject to Brazilian capital gains tax of $28 million that was remitted to the Brazilian tax authorities in March 2017. We received net cash proceeds in April 2017 of $286 million, which is net of a foreign exchange loss of $6 million that was incurred in April 2017. We received 29,623,756 B3 common shares valued at their quoted market price of $181 million. In April 2017, we sold the B3 common shares for net proceeds of $152 million, which is net of a capital gain tax of $26 million that was remitted to the Brazilian tax authorities and further transaction expenses of $3 million that were incurred in April 2017. We used the $438 million in net cash and stock proceeds received from the merger and sale of B3 shares to pay down amounts outstanding under our Commercial Paper Program and for share repurchases.

The $500 million fair value of our investment in Cetip included an accumulated unrealized gain of $176 million, based on the $324 million cost basis. In connection with the sale of our equity investment in Cetip, the $176 million, accumulated unrealized gain was reclassified out of accumulated other comprehensive income and was recognized in other income as a realized investment gain in the accompanying consolidated statement of income for the nine months ended September 30, 2017.

As of September 30, 2017, we held $734 million in U.S. Treasury securities. Of these securities, $534 million were recorded as short-term restricted cash and investments and $200 million were recorded as long-term restricted cash and investments in the accompanying consolidated balance sheet as of September 30, 2017. We account for the U.S. Treasury securities held using the available-for-sale method.

Mutual funds represent equity and fixed income mutual funds held for the purpose of providing future payments for the supplemental executive savings plan and the supplemental executive retirement plan and are classified as available-for-sale securities.

We did not use Level 2 and 3 inputs to determine the fair value of assets or liabilities measured at fair value on a recurring basis as of September 30, 2017 or December 31, 2016. We measure certain assets, such as intangible assets and cost and equity method investments, at fair value on a non-recurring basis. These assets are recognized at fair value if they are deemed to be impaired. As of September 30, 2017 and December 31, 2016, none of these assets were required to be recorded at fair value since no impairments were recorded.


~~12.~~13.	Segment Reporting

We operate two business segments: our Trading and Clearing segment and our Data and Listings segment. This presentation is reflective of how our chief operating decision maker reviews and operates our business. Our Trading and Clearing segment comprises our transaction-based execution and clearing businesses. Our Data and Listings segment comprises our subscription-based data services and securities listings businesses. Our chief operating decision maker does not review total assets ~~intersegment revenues/expenses~~ or statements of income below operating income by segments; therefore, such information is not presented below. Our two segments do not engage in intersegment transactions.

Certain segment expenses for the six months and three months ended June 30, 2017 have been reclassified to conform to our current periods' segment financial statement presentation. This reclassification increased the operating expenses for the Data and Listings segment by $33 million and $17 million for the six months and three months ended June 30, 2017, respectively, while decreasing the operating expenses for the Trading and Clearing segment by the same amounts. Financial data for our business segments is as follows for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016~~2017 (in millions):



	Six Months Ended June 30, 2018						Six Months Ended June 30, 2017
	Trading and Clearing Segment		Data and Listings Segment		Consolidated		Trading and Clearing Segment		Data and Listings Segment		Consolidated
Revenues:
Energy futures and options contracts	$	485	$	—	$	485	$	459	$	—	$	459
Agricultural and metals futures and options contracts	139		—		139		118		—		118
Interest rates and other financial futures and options contracts	185		—		185		172		—		172
Cash equities and equity options	827		—		827		771		—		771
OTC and other transactions	126		—		126		95		—		95
Pricing and analytics	—		516		516		—		480		480
Exchange data	—		287		287		—		280		280
Desktops and connectivity	—		243		243		—		281		281
Listings	—		220		220		—		217		217
Other revenues	108		—		108		94		—		94
Revenues	1,870		1,266		3,136		1,709		1,258		2,967
Transaction-based expenses	665		—		665		621		—		621
Revenues, less transaction-based expenses	1,205		1,266		2,471		1,088		1,258		2,346
Operating expenses	425		741		1,166		397		758		1,155
Operating income	$	780	$	525	$	1,305	$	691	$	500	$	1,191

Trading and Clearing Segment Data and Listings Segment Consolidated
Nine Months Ended September 30, 2017:
Revenues, less transaction-based expenses $ 1,611
$ 1,874
$ 3,485
Operating expenses 643
1,055
1,698
Operating income 968
819
1,787
Nine Months Ended September 30, 2016:
Revenues, less transaction-based expenses $ 1,584
$ 1,777
$ 3,361
Operating expenses 672
1,080
1,752
Operating income 912
697
1,609


	Trading and Clearing Segment		Data and Listings Segment		Consolidated		Three Months Ended June 30, 2018						Three Months Ended June 30, 2017
Three Months Ended September 30, 2017
							Trading and Clearing Segment		Data and Listings Segment		Consolidated		Trading and Clearing Segment		Data and Listings Segment		Consolidated
Revenues:
Energy futures and options contracts							$	250	$	—	$	250	$	231	$	—	$	231
Agricultural and metals futures and options contracts							74		—		74		62		—		62
Interest rates and other financial futures and options contracts							94		—		94		89		—		89
Cash equities and equity options							389		—		389		390		—		390
OTC and other transactions							57		—		57		45		—		45
Pricing and analytics							—		262		262		—		242		242
Exchange data							—		144		144		—		142		142
Desktops and connectivity							—		120		120		—		137		137
Listings							—		111		111		—		109		109
Other revenues							55		—		55		49		—		49
Revenues							919		637		1,556		866		630		1,496
Transaction-based expenses							310		—		310		316		—		316
Revenues, less transaction-based expenses	$	523	$	620	$	1,143	609		637		1,246		550		630		1,180
Operating expenses	213		334		547		218		373		591		197		374		571
Operating income	310		286		596		$	391	$	264	$	655	$	353	$	256	$	609
Three Months Ended September 30, 2016
Revenues, less transaction-based expenses	$	483	$	595	$	1,078
Operating expenses	245		359		604
Operating income	238		236		474

Revenue from ~~two~~one clearing ~~members~~member of ~~our~~the Trading and Clearing segment comprised ~~10%~~$211 million or 17% and $107 million or 17% of our Trading and Clearing revenues for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017 and revenue~~2018, respectively. Revenue from ~~one~~two clearing ~~member~~members of ~~our~~the Trading and Clearing segment comprised ~~10%~~$243 million or 22% and $127 million or 23% of our Trading and Clearing revenues for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2016.~~2017, respectively. Clearing members are primarily intermediaries and represent a broad range of principal trading firms. If a clearing member ceased its operations, we believe that the trading firms would continue to conduct transactions and would clear those transactions through another clearing member firm. No additional customers or clearing members accounted for more than 10% of our segment revenues or consolidated revenues for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016.~~2017.


~~13.~~14.	Earnings Per Common Share

The following is a reconciliation of the numerators and denominators of the basic and diluted earnings per common share computations for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016~~2017 (in millions, except per share amounts):


	Nine Months Ended September 30,				Three Months Ended September 30,				Six Months Ended June 30,				Three Months Ended June 30,
	2017		2016		2017		2016		2018		2017		2018		2017
Basic:
Net income attributable to Intercontinental Exchange, Inc.	$	1,289	$	1,070	$	369	$	344	$	919	$	922	$	455	$	419
Weighted average common shares outstanding	591		595		588		596		580		593		578		591
Basic earnings per common share	$	2.18	$	1.80	$	0.63	$	0.58	$	1.59	$	1.56	$	0.79	$	0.71
Diluted:
Weighted average common shares outstanding	591		595		588		596		580		593		578		591
Effect of dilutive securities - stock options and restricted shares	4		4		4		4		3		4		3		4
Diluted weighted average common shares outstanding	595		599		592		600		583		597		581		595
Diluted earnings per common share	$	2.17	$	1.79	$	0.62	$	0.57	$	1.58	$	1.55	$	0.78	$	0.71

Basic earnings per common share is calculated using the weighted average common shares outstanding during the period. Common equivalent shares from stock options and restricted stock awards, using the treasury stock method, are included in the diluted per share calculations unless the effect of their inclusion would be antidilutive. During the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, 413,105 and ~~2016, 7,380 and 715,955~~726,696 outstanding stock options, respectively, were not included in the computation of diluted earnings per common share since the inclusion would have had an antidilutive effect because the outstanding stock option exercise prices were

greater than the average market price of the common shares during the relevant periods. Certain figures in the table above may not recalculate due to rounding.


~~14.~~15.	Subsequent Events

We have evaluated subsequent events and determined that no events or transactions, except for those disclosed in Notes 3 and 10, met the definition of a subsequent event for purposes of recognition or disclosure in the accompanying consolidated financial ~~statements except those events disclosed in Notes 2, 3 and 10.~~statements.


ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

This Quarterly Report on Form 10-Q, including the sections entitled “Notes to Consolidated Financial ~~Statements”,~~Statements,” “Legal Proceedings” and “Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations”,~~Operations,” contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Any statements contained herein that are not statements of historical fact may be forward-looking statements. Any forward looking statements are based on our present beliefs and assumptions as well as the information currently available to us. Forward-looking statements may be introduced by or contain terminology such as “may”, “will”, “should”, “could”, “would”, “targets”, “goal”, “expect”, “intend”, “plan”, “anticipate”, “believe”, “estimate”, “predict”, “potential”, “continue”,“may,” “will,” “should,” “could,” “would,” “targets,” “goal,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue,” or the antonyms of these terms or other comparable terminology. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our results, levels of activity, performance, cash flows, financial position or achievements to differ materially from those expressed or implied by these forward-looking statements. These risks and other factors include those set forth in Item 1(A) under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2017, or our ~~2016~~2017 Form 10-K, as filed with the SEC on February 7, ~~2017.~~2018.

Forward-looking statements and other risks and factors that may affect our performance include, but are not limited to: conditions in global financial markets and domestic and international economic, political and social conditions; the impact of the introduction of or any changes in laws, regulations, rules or government policy with respect to financial markets, increased regulatory scrutiny or enforcement actions and our ability to comply with these requirements; volatility in commodity prices, equity prices, and price volatility of financial benchmarks and instruments such as interest rates, credit spreads, equity indices and foreign exchange rates; the business environment in which we operate and trends in our industry, including trading volumes, clearing, data services, fees, changing regulations, competition and consolidation; the success of our clearing houses and our ability to minimize the risks associated with operating clearing houses in multiple jurisdictions; the success of our equity and derivative exchanges and the exchanges’ compliance with their respective regulatory and oversight responsibilities; the resilience of our electronic platforms and soundness of our business continuity and disaster recovery plans; continued high renewal rates of subscription-based data revenues; our ability to identify and effectively pursue, implement and integrate acquisitions and strategic alliances; our ability to complete and realize the synergies and benefits of our acquisitions within the expected time frame, and to integrate acquired operations with our business; our ability to effectively maintain our growth; the performance and reliability of our other technologies and those of third party service providers, including our ability to keep pace with technological developments and ensure that the technology we utilize is not vulnerable to security risks or other disruptive events; our ability to identify trends and adjust our business to benefit from such trends; the accuracy of our cost and other financial estimates and our belief that cash flows from operations will be sufficient to service our debt and fund our operational and capital expenditure needs; our ability to maintain existing market participants and data customers, and attract new ones, and to offer additional products and services, leverage our risk management capabilities and enhance our technology in a timely and cost-effective fashion; our ability to attract and retain key talent; our ability to protect our intellectual property rights and to operate our business without violating the intellectual property rights of others; and potential adverse results of threatened or pending litigation and regulatory actions and proceedings.

We caution you not to place undue reliance on any forward-looking statements as they speak only as of the date on which such statements were made, and we undertake no obligation to update any forward-looking statement or to reflect the occurrence of an unanticipated event. New factors may emerge ~~from time to time,~~ and it is not possible ~~for management~~ to predict all factors that may affect our business and prospects. Further, management cannot assess the impact of each factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

In this Quarterly Report on Form 10-Q, unless otherwise indicated, the terms “Intercontinental ~~Exchange”, “ICE”, “we”, “us”, “our”,~~Exchange,” “ICE,” “we,” “us,” “our,” “our company” and “our business” refer to Intercontinental Exchange, Inc., together with its consolidated subsidiaries. Due to rounding, figures may not sum exactly.

Overview

We are a leading global operator of regulated exchanges, clearing houses and listings venues, and a provider of data services for commodity, fixed income and ~~financial~~equity markets. We operate regulated marketplaces for listing, trading ~~listing~~ and clearing a broad array of derivatives ~~contracts~~ and securities contracts across major asset classes, including energy and agricultural commodities, interest rates, equities, equity derivatives, ~~exchange traded funds,~~ETFs, credit derivatives, bonds and currencies. We also offer end-to-end ~~market~~ data services and solutions to support the trading, investment, ~~and~~ risk management and connectivity needs of customers around the world across ~~virtually~~ all major asset classes.

Our exchanges include ~~futures~~derivative exchanges in the U.S., U.K., EU, Canada and Singapore, and cash equities, equity options and bond exchanges in the U.S. We also operate OTC markets for physical energy, fixed income and CDS trade execution. To

serve global derivatives markets, we operate central counterparty clearing houses in the U.S., U.K., EU, Canada and Singapore. We offer a range of data services for global financial and commodity markets, including pricing and reference data, exchange data, analytics, feeds, ~~desktop~~index services, desktops and connectivity solutions. Through our markets, clearing houses, listings and market data services, we provide end-to-end solutions

for our customers through liquid markets, benchmark products, access to capital markets, and related services to support their ability to manage risk and raise capital. Our business is currently conducted as two reportable business segments, our Trading and Clearing segment and our Data and Listings segment, and the majority of our identifiable assets are located in the U.S., U.K. and ~~U.K.~~Canada.

Recent Developments

~~Pending Divestiture of Trayport~~U.S. Tax Cuts and ~~Its Classification as Held for Sale~~Jobs Act

On December ~~11, 2015,~~22, 2017, the TCJA was signed into law. The TCJA reduced the U.S. federal corporate income tax rate from 35% to 21% effective January 1, 2018. In our financial statements for the year ended December 31, 2017, we revalued our U.S. deferred tax assets and liabilities at the new federal corporate income tax rate as of the date of enactment of the TCJA and recognized a $764 million deferred tax benefit based on a reasonable estimate as of December 22, 2017. The TCJA imposed a transition tax on certain accumulated foreign earnings aggregated across all non-U.S. subsidiaries, net of foreign deficits. As we are in an aggregate net foreign deficit position for U.S. tax purposes, we are not liable for the transition tax.

Many of the tax provisions under the TCJA became effective January 1, 2018, including the new federal 21% corporate income tax rate and complex international tax provisions. Our effective tax rates for the six months and three months ended June 30, 2018 are lower than the effective tax rates for the comparable periods in 2017 primarily because of the new reduced U.S. federal corporate income tax rate, partially offset by additional federal and state income taxes under these international tax provisions. Given the complexity of these international provisions and certain potential unintended consequences that are under debate at both the federal and state level, further federal and state guidance is anticipated, but the likelihood and timing of such guidance remains uncertain.

Acquisitions

On January 2, 2018, we acquired 100% of Trayport in a stock transaction. The total purchase price was $620 million, comprised of 12.6 million shares of our common stock. Trayport is a software company that licenses its technology to serve exchanges, OTC brokers and traders to facilitate electronic and hybrid trade execution primarily in the energy markets.

Trayport is included in our data and listings segment. The total assets held for sale as of September 30, 2017 were $595 million and were reclassified and are included in “prepaid expenses and other current assets” in our accompanying consolidated balance sheet and the total liabilities held for sale as of September 30, 2017 were $60 million and were reclassified and are included in “other current liabilities” in our accompanying consolidated balance sheet. Refer to note 10 to our consolidated financial statements and related notes, which are included elsewhere in this Quarterly Report, for more information on the pending divestiture of Trayport and its classification as held for sale.

~~Pending Acquisition of Virtu BondPoint~~

~~On October 24, 2017, we entered into a definitive agreement to acquire 100% of Virtu~~ BondPoint from Virtu Financial, Inc. for $400 million in cash. ~~The transaction is expected to close in the first quarter of 2018, and the closing is subject to applicable regulatory reviews and approvals. Virtu~~ BondPoint is a leading provider of electronic fixed income trading solutions for the buy-side and sell-side, offering access to centralized liquidity and automated trade execution services through its ATS ~~linking~~and provides trading services to more than 500 financial services firms.

On July 18, 2018, we acquired CHX Holdings, Inc., the parent company of CHX, a full-service stock exchange, including trading, data and corporate listings services. CHX operates as a registered national securities exchange.

Investment in Euroclear

~~Acquisition of Global Research Division~~’~~s Index Business from Bank of America Merrill Lynch (BofAML)~~

~~Purchase of Minority Interests~~

~~NYSE Governance Services Divestiture~~

~~On June~~Subsequent to our January 1, ~~2017, we sold NYSE Governance Services~~2018 adoption of ASU 2016-01, for investments without a readily determinable fair value, including Euroclear, an adjustment to Marlin Heritage, L.P. NYSE Governance Services provides governance and compliance analytics and education solutions for organizations and their boards of directors through dynamic learning solutions. Weestimated fair value is only required if there is an observable price change in an orderly transaction in a similar or identical investment, with any adjustment recognized ain net ~~loss of $6 million on~~income. There were no such adjustments made during the ~~sale of NYSE Governance Services, which was recorded as amortization expense within our data and listings segment in the accompanying consolidated statements of income for the nine~~six months ended ~~September~~June 30, ~~2017.~~

~~TMX Atrium Acquisition~~

On May 1, 2017, we acquired 100% of TMX Atrium, a global extranet and wireless services business, from TMX Group. TMX Atrium provides low-latency access to markets and market data across 12 countries, more than 30 major trading venues, and ultra-low latency wireless connectivity to access markets and market data in the Toronto, New Jersey and Chicago metro areas. The wireless assets consist of microwave and millimeter networks that transport market data and provide private bandwidth. Our customers are increasingly seeking wireless services for use in their trading strategies. TMX Atrium is now part of ICE Data Services and is being integrated with our connectivity services.

~~Cetip Investment Gain~~

Until March 29, 2017, we held a 12% ownership interest in Cetip, which we classified as an available-for-sale long-term investment. On March 29, 2017, Cetip and BM&FBOVESPA S.A. finalized a merger agreement. BM&FBOVESPA S.A., which changed its name to B3 S.A. - Brasil, Bolsa, Balcao, or B3, following the merger with Cetip, is a stock exchange and operator of registration, clearing, custodial and settlement services for equities, financial securities, indices, rates, commodities and currencies and is located in São Paulo, Brazil. The merger valued our Cetip investment at $500 million. We received the proceeds in cash and in B3 common stock.

The $500 million fair value of our investment in Cetip included an accumulated unrealized gain of $176 million, based on the $324 million cost basis. In connection with the sale of our equity investment in Cetip, the $176 million accumulated unrealized gain was reclassified out of accumulated other comprehensive income and was recognized in other income as a realized investment gain in the accompanying consolidated statement of income for the nine months ended September 30, 2017.

~~Refer to note 11 to our consolidated financial statements and related notes, which are included elsewhere in this Quarterly Report, for more information on the Cetip investment gain.~~2018.

~~Interactive Data Managed Solutions Divestiture~~

On March 31, 2017, we sold IDMS, a unit of Interactive Data, to FactSet. IDMS is a managed solutions and portal provider for the global wealth management industry. There was no gain or loss recognized on the sale of IDMS.

~~National Stock Exchange Acquisition~~

On January 31, 2017, we acquired 100% of National Stock Exchange, Inc., now named NYSE National. The acquisition gives the NYSE Group a fourth U.S. exchange license. NYSE National is distinct from NYSE Group’s three listings exchanges because NYSE National will only be a trading venue and will not be a listings market. NYSE Group’s three listings exchanges, NYSE, NYSE American (NYSE American was formerly known as NYSE MKT) and NYSE Arca, have unique market models designed for corporate and ETF issuers. After closing the transaction, NYSE National ceased operations on February 1, 2017. We will engage with NYSE National members, buy-side participants and retail brokerage firms before finalizing operational plans for NYSE National’s re-launch, which is expected to occur in 2018.

Regulation

Our markets are primarily subject to the jurisdiction of regulatory agencies in the U.S., U.K., EU, Canada and Singapore. Global policy makers have undertaken reviews of their existing legal framework governing financial markets in connection with regulatory reform, and have either passed new laws and regulations, or are in the process of debating and/or enacting new laws and regulations that apply to our business and to our customers’ businesses. Legislative and regulatory actions may impact the way in which we or our customers conduct business and may create uncertainty, which could affect trading volumes or demand for market data. ~~As discussed in~~See Part 1, Item 1 “Business - Regulation” included in our ~~2016~~2017 Form 10-K for a discussion of the primary regulations applicable to our business. As discussed in Part 1, Item 1 of our 2017 Form 10-K, the implementation of the Markets in Financial Instruments ~~Directives~~Directive II, or MiFID II, and ~~its counterpart~~ the European Market Infrastructure Regulation, or EMIR, may result in operational, regulatory and/or business risk.

Most of the specific regulations which support the MiFID II framework have now been approved by the European Parliament and European Council. The European Securities and Markets Authority, or ESMA, and the national regulatory authorities are continuing to work on detailed aspects of the framework ~~which~~that are relevant to the markets operated by ICE Futures Europe and ICE Endex, including position limits and the determination of pre-trade and post-trade price transparency ~~requirements~~parameters for financial instruments. ~~We expect~~Our key areas of focus on these evolving efforts are:

The proposed revisions of the ~~entire set of position limits for commodity contracts~~regulatory structure could have an impact on our non-EU clearing houses to the extent they are deemed to be ~~published by the end of 2017. We are accessing any potential market impacts as the requirements are published, however any impacts are uncertain at this time.~~

~~In March 2017, the U.K. officially triggered Article 50 and notified the EU of its intention of leaving the EU. The triggering of Article 50 begins the process of withdrawal from the EU,~~doing business in Europe, which ~~will last two years unless extended by the unanimous decision of member states. We are monitoring the impact~~might involve changes to ~~our business of the U.K. leaving the EU. The impact to our business and corresponding regulatory changes are uncertain at this time, and may not be known in the near future.~~

~~In 2017, the Commodity Futures Trading Commission,~~ clearing house regulations and/or CFTC, announced its new agenda calling for regulatory simplification and the reduction of regulatory burdens. The CFTC is looking to restructure its rules by moving away from prescriptive regulations and adopting a principles-based approach. The restructuring of regulations could apply to our business and to our customers’ businesses. Any impacts are uncertain at this time, and may not be known in the near future.

supervision. In ~~June~~ 2017, the European Commission published a proposal to revise the current regulatory structure for non-EU clearing houses. The nature and extent of the regulation would depend on the “impact” of a non-EU clearing house’s business in the EU. The publication discusses a “sliding scale” of regulation that includes: continued implementation of the existing EMIR equivalence and recognition regime for low impact non-EU clearing houses; direct regulatory oversight for medium impact non-EU clearing houses; and, with respect to systemically important, high impact, non-EU clearing houses, an undefined “location” requirement. Details on the classification of non-EU clearing will be established by the European Commission in cooperation with ESMA and the European System of Central Banks. The proposal will undergo legislative review by the European Parliament and the EU Member States, and is subject to change.

The ~~proposal~~non-discriminatory access provisions of MiFID II, as currently drafted, would require our European exchanges and central counterparty clearing houses, or CCPs, to offer access to third parties on commercially reasonable terms. In addition, MiFID II could require our European exchanges and CCPs to allow participants to trade and/or clear at other venues, which may encourage competing venues to offer our products. In June 2016, the EU approved a twelve-month postponement of MiFID II implementation and compliance to January 3, 2018. On January 3, 2018, ICE Futures Europe and ICE Clear Europe received a deferral from the U.K. Financial Conduct Authority, or FCA, and the Bank of England, respectively, which delays the non-discriminatory access provision of MiFID II until July 3, 2020.

The adoption and implementation of position limit rules in the U.S. and Europe could have an impact on our ~~non-EU clearing houses~~commodities business if comparable trading venues in foreign jurisdictions are not subject to equivalent rules. Position limits became effective in Europe beginning January 2018 under MiFID II. The FCA has published certain position limits for commodity contracts. In certain cases, the position limits are lower than on U.S. trading venues and in certain cases position limits are higher than U.S. equivalent contracts. The FCA is actively reviewing the recently issued position limits. Conversely, in December 2016, the Commodity Futures Trading Commission, or CFTC, re-proposed the position limit rules as opposed to finalizing the rule. There is potential for further divergence between MiFID II and U.S. position limit rules if the U.S. makes changes to the ~~extent they~~financial regulations while the EU continues with MiFID II implementation.

The implementation of capital charges in Basel III, particularly the Supplemental Leverage Ratio with respect to certain clearing members of central counterparties, may impose burdensome capital requirements on our clearing members and customers that may disincentivize clearing. The Federal Reserve Board and Office of the Comptroller of the Currency have proposed rule changes to the leverage ratio requirements but these regulations still may have an impact on our clearing members.

The SEC adoption of the proposed two-year Transaction Fee Pilot, which would subject stock exchange transaction fee pricing, including “maker-taker” fee-and-rebate pricing models to new temporary pricing restrictions across three test groups and require the exchanges to prepare and publicly post data, could make the NYSE less competitive with off-exchange trading venues by limiting the transaction fees charged and rebates paid by the securities exchanges.

In addition, our U.S. securities exchanges are ~~deemed~~regulated by the SEC, and as discussed in Part II, Item 1, "Legal Proceedings," on March 6, 2018, NYSE and affiliated exchanges reached a settlement with the SEC for the various matters under investigation and agreed to ~~be doing business in Europe.~~pay a $14 million civil monetary penalty, together with certain non-monetary relief.

Consolidated Financial Highlights

The following summarizes our results and significant changes in our consolidated financial performance for the periods presented (dollars in millions, except per share amounts, and YTD represents the ~~nine-month~~six-month periods ended ~~September~~June 30th):


	Nine Months Ended September 30,								Three Months Ended September 30,								Six Months Ended June 30,							Three Months Ended June 30,
	2017			2016			Change		2017			2016			Change		2018			2017			Change	2018			2017			Change
Revenues, less transaction-based expenses	$	3,485		$	3,361		4	%	$	1,143		$	1,078		6	%	$	2,471		$	2,346		5 %	$	1,246		$	1,180		6 %
Operating expenses	$	1,698		$	1,752		(3)	%	$	547		$	604		(10)	%	$	1,166		$	1,155		1 %	$	591		$	571		4 %
Adjusted operating expenses⁽¹⁾	$	1,459		$	1,454		—	%	$	476		$	484		(2)	%	$	997		$	987		1 %	$	503		$	490		2 %
Operating income	$	1,787		$	1,609		11	%	$	596		$	474		26	%	$	1,305		$	1,191		10 %	$	655		$	609		7 %
Adjusted operating income⁽¹⁾	$	2,026		$	1,907		6	%	$	667		$	594		13	%	$	1,474		$	1,359		8%	$	743		$	690		8%
Operating margin	51		%	48		%	3 pts		52		%	44		%	8 pts		53		%	51		%	2 pts	53		%	52		%	1 pt
Adjusted operating margin⁽¹⁾	58		%	57		%	1 pt		58		%	55		%	3 pts		60		%	58		%	2 pts	60		%	58		%	2 pts
Other income (expense), net	$	61		$	(110	)	n/a		$	(36	)	$	(31	)	14	%	$	(77	)	$	101		n/a	$	(44	)	$	(42	)	3 %
Income tax expense	$	537		$	409		31	%	$	185		$	93		100	%	$	292		$	354		(17) %	$	149		$	140		7 %
Effective tax rate	29		%	27		%	2 pts		33		%	21		%	12 pts		24		%	27		%	(3) pts	24		%	25		%	(1) pt
Net income attributable to ICE	$	1,289		$	1,070		21	%	$	369		$	344		7	%	$	919		$	922		— %	$	455		$	419		8 %
Adjusted net income attributable to ICE⁽¹⁾	$	1,319		$	1,237		7	%	$	430		$	385		12	%	$	1,050		$	891		18 %	$	525		$	449		17%
Diluted earnings per share attributable to ICE common shareholders	$	2.17		$	1.79		21	%	$	0.62		$	0.57		9	%
Adjusted diluted earnings per share attributable to ICE common shareholders⁽¹⁾	$	2.22		$	2.07		7	%	$	0.73		$	0.64		14	%
Diluted earnings per share attributable to ICE common stockholders																	$	1.58		$	1.55		2 %	$	0.78		$	0.71		10 %
Adjusted diluted earnings per share attributable to ICE common stockholders⁽¹⁾																	$	1.80		$	1.49		21 %	$	0.90		$	0.76		18 %
Cash flows from operating activities	$	1,410		$	1,508		(7)	%									$	1,236		$	1,099		13 %

⁽¹⁾The adjusted numbers in the charts and table above are calculated by excluding items that are not reflective of our cash operations and core business performance, and for adjusted net income attributable to ICE and adjusted diluted earnings per share attributable to ICE common ~~shareholders,~~stockholders, are presented net of taxes. As a result, these adjusted numbers are not calculated in accordance with GAAP. See “- Non-GAAP Financial Measures” below.

Revenues, less transaction-based expenses, increased ~~$124~~$125 million and ~~$65~~$66 million for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016.~~2017. See “- Trading and Clearing Segment” and “Data and Listings Segment” below for a discussion of the significant changes in our revenues. The increase in revenues includes ~~$34~~$32 million ~~in unfavorable foreign exchange effects arising from the strengthening U.S. dollar for the nine months ended September 30, 2017, from the comparable period in 2016,~~ and $3$11 million in favorable foreign exchange effects arising from the weakening U.S. dollar for the six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable ~~period~~periods in ~~2016.~~2017. See Item 3

~~“Quantitative~~ “Quantitative and Qualitative Disclosures About Market Risk - Foreign Currency Exchange Rate Risk” below for additional information on the impact of currency fluctuations. Excluding the ~~$34~~$32 million ~~in unfavorable foreign exchange effects for the nine months ended September 30, 2017~~ and ~~the $3~~$11 million in favorable foreign exchange effects for the six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, our revenues, less transaction-based expenses, would have been ~~$3.5~~$2.4 billion and ~~$1.1~~$1.2 billion for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, an increase of 5%4% and 6%5%, respectively, from the comparable periods in ~~2016.~~2017.

Operating expenses ~~decreased $54~~increased $11 million and ~~$57~~$20 million for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016. During the nine and three months ended September 30, 2016, we recorded a $33 million Creditex customer relationship intangible asset impairment.~~2017. See “- Consolidated Operating Expenses” below for a discussion of the significant changes in our operating expenses. The ~~decrease~~increase in operating expenses, ~~includes $19 million in favorable foreign exchange effects arising from the strengthening U.S. dollar for the nine months ended September 30, 2017,~~ from the comparable ~~period~~periods in ~~2016,~~2017, includes $14 million and $1$5 million in unfavorable foreign exchange effects arising from the weakening U.S. dollar for the six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively. Excluding the $14 million and $5 million in unfavorable foreign exchange effects, our operating expenses would have been $1.2 billion and $586 million for the six months and three months ended June 30, 2018, respectively, flat for the six months ended June 30, 2018 and an increase of 3% for the three months ended June 30, 2018, from the comparable ~~period~~periods in ~~2016.~~2017.

In connection with ~~Cetip’s~~the merger of Cetip, S.A., or Cetip, with BM&FBOVESPA S.A., which changed its name to B3 S.A. - Brasil, Bolsa, Balcão, or B3, on March 29, 2017, we recognized a $176 million realized investment gain in other income (expense), net for the ~~nine~~six months ended ~~September~~June 30, 2017 and $9 million in foreign exchange losses and transaction expenses in other income (expense), net for the ~~nine~~six months and three months ended ~~September~~June 30, 2017. See “- ~~Recent Developments - Cetip Investment Gain” above.~~Consolidated Non-Operating Income (Expense)” below.

Variability in Quarterly Comparisons

The business environments in which we operate directly affect our results of operations. Our results have been and will continue to be affected by many factors, including, without limitation, market volatility and the level of trading activity in our markets, which during any period is significantly influenced by general market conditions; legislative and regulatory changes as well as ~~our~~ fulfillment of our regulatory obligations; competition; demand for our market data services and our market share; our system reliability; our ability to offer new products; ~~our~~ acquisition ~~activities~~and divestiture activity and the pace of industry consolidation; broad trends in the data and finance industry; the number and financial health of companies listed on our cash markets; geopolitical events; real and perceived supply and demand ~~imbalances;~~imbalance; changing technology in the financial services industry; and our reputation, among other factors. ~~In particular, in recent years, our~~Our business environment has been characterized by industry consolidation and increasing competition among global markets for trading, clearing and listings; the globalization of exchanges, customers and competitors; market participants’ rising demand for speed, ~~and~~ data capacity and connectivity, which requires ongoing investment in technology; evolving and disparate regulation across multiple jurisdictions; and increasing focus on capital and cost efficiencies.

Price volatility increases the need to hedge risk and creates demand among market participants for the exchange of risk through trading and clearing. Market liquidity is one of the primary market attributes for attracting and maintaining customers and is an important indicator of a market’s strength. In addition, the ability to evolve existing products to serve emerging needs, develop new products and respond to competitive dynamics in pricing, exclusivity and consolidation is important to our business. Changes in these and other factors could cause our revenues to fluctuate from period to period and these fluctuations may affect the reliability of period to period comparisons of our revenues and operating results. For additional information regarding the factors that affect our results of operations, see Item 1(A) “Risk Factors” included in our ~~2016~~2017 Form 10-K.

Segment Reporting

While revenues are allocated directly to segments, a significant portion of our operating expenses are not solely related to a specific segment because the expenses serve functions that are necessary for the operation of both segments. Because these expenses do not relate to a single segment, we have employed a reasonable allocation method to allocate expenses between the segments for

presentation purposes. We have elected to use a pro-rata revenue approach as the allocation method for the expenses that do not relate solely to one segment. Further, precise allocation of expenses to specific revenue streams within these segments is not reasonably possible. Accordingly, we did not allocate expenses to specific revenue streams within the segments.

Certain segment expenses for the six months and three months ended June 30, 2017 have been reclassified to conform to our current period’s segment financial statement presentation. This reclassification increased the operating expenses for the Data and Listings segment by $33 million and $17 million for the six months and three months ended June 30, 2017, respectively, while decreasing the operating expenses for the Trading and Clearing segment by the same amount.

Trading and Clearing Segment

The following charts and table present our selected statements of income data for our Trading and Clearing segment (dollars in millions and YTD represents the ~~nine-month~~six-month periods ended ~~September~~June 30th):

⁽¹⁾The adjusted numbers in the charts above are calculated by excluding items that are not reflective of our cash operations and core business performance. As a result, these adjusted numbers are not calculated in accordance with U.S. GAAP. See “- Non-GAAP Financial Measures” below.

Nine Months Ended
September 30, Three Months Ended September 30,
2017 2016 Change 2017 2016 Change
Revenues:
Brent crude futures and options contracts $ 249
$ 224
11 % $ 80
$ 70
13 %
Other oil futures and options contracts 104
86
21
35
30
21
Gasoil futures and options contracts 85
73
17
32
25
24
Natural gas futures and options contracts 153
154
(1 ) 48
46
5
Power futures and options contracts 52
62
(17 ) 15
18
(16 )
Emissions and other energy futures and options contracts 39
42
(8 ) 13
10
14
Sugar futures and options contracts 78
91
(14 ) 23
25
(3 )
Other agricultural and metals futures and options contracts 89
90
(1 ) 26
27
(4 )
Interest rates futures and options contracts 149
137
9
48
37
32
Other financial futures and options contracts 105
107
(2 ) 34
33
1
Cash equities and equity options 1,126
1,354
(17 ) 355
410
(13 )
Credit default swaps 107
109
(2 ) 37
35
5
Other transactions 37
37
(1 ) 12
11
3
Transaction and clearing, net 2,373
2,566
(8 ) 758
777
(3 )
Other revenues 148
131
14
54
44
24
Revenues 2,521
2,697
(7 ) 812
821
(1 )
Transaction-based expenses 910
1,113
(18 ) 289
338
(15 )
Revenues, less transaction-based expenses 1,611
1,584
2
523
483
8
Other operating expenses 498
468
6
168
156
7
Acquisition-related transaction and integration costs —
8
(97 ) —
1
(84 )
Depreciation and amortization (including impairment) 145
196
(26 ) 45
88
(49 )
Operating expenses 643
672
(4 ) 213
245
(13 )
Operating income $ 968
$ 912
6 % $ 310
$ 238
30 %



	Six Months Ended June 30,						Three Months Ended June 30,
	2018		2017		Change		2018		2017		Change
Revenues:
Energy futures and options contracts	$	485	$	459	5	%	$	250	$	231	8	%
Agricultural and metals futures and options contracts	139		118		18		74		62		20
Interest rates and other financial futures and options contracts	185		172		8		94		89		7
Cash equities and equity options	827		771		7		389		390		—
OTC and other transactions	126		95		32		57		45		26
Transaction and clearing, net	1,762		1,615		9		864		817		6
Other revenues	108		94		15		55		49		12
Revenues	1,870		1,709		9		919		866		6
Transaction-based expenses	665		621		7		310		316		(2	)
Revenues, less transaction-based expenses	1,205		1,088		11		609		550		11
Other operating expenses	321		299		7		164		146		12
Depreciation and amortization	102		98		4		52		51		3
Acquisition-related transaction and integration costs	2		—		n/a		2		—		n/a
Operating expenses	425		397		7		218		197		11
Operating income	$	780	$	691	13	%	$	391	$	353	11	%

Transaction and Clearing Revenues

Overview

Our transaction and clearing revenues are reported on a net basis, except for the NYSE transaction-based expenses discussed below, and consist of fees collected from our derivatives, fixed income, cash equities and equity options trading and derivatives clearing. In our derivatives markets, we earn transaction and clearing revenues from both counterparties to each contract that is traded and/or cleared, and in our equity and equity options markets, we receive trade execution fees as well as routing fees related to orders in our markets which are routed to other markets for execution.

Rates per-contract are driven by the number of contracts or securities traded and the fees charged per contract, net of certain rebates. Our per-contract transaction and clearing revenues will depend upon many factors, including, but not limited to, market conditions, transaction and clearing volume, product mix, pricing, applicable revenue sharing and market making agreements, and new product introductions. Because transaction and clearing revenues are generally assessed on a per-contract basis, revenues and profitability fluctuate with changes in contract volume and due to product mix.

For ~~both~~ the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, 21% and ~~2016,~~ 20%, respectively, of our Trading and Clearing segment revenues, less transaction-based expenses, were billed in pounds sterling or euros and for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, 21% and ~~18%~~19%, respectively, were billed in pounds sterling or euros. As the pound sterling or euro exchange rate changes, the U.S. equivalent of revenues denominated in foreign currencies changes accordingly. The strengthening of the U.S. dollar compared to the pound sterling and euro for the nine months ended September 30, 2017, from the comparable period in 2016, reduced our Trading and Clearing segment revenues, less transaction-based expenses, by $21 million and the weakening of the U.S. dollar compared to the pound sterling and euro ~~for the three months ended September 30, 2017, from the comparable period~~resulted in ~~2016, increased~~an increase to our Trading and Clearing segment revenues, less transaction-based expenses, by ~~$2 million.~~$23 million for the six months ended June 30, 2018, from the comparable period in 2017, and by $8 million for the three months ended June 30, 2018, from the comparable period in 2017. See Item 3 “- Quantitative and Qualitative Disclosures About Market Risk - Foreign Currency Exchange Rate Risk” below for additional information on the impact of currency fluctuations.

Our transaction and clearing revenues are presented net of rebates. We recorded rebates of ~~$576~~$432 million and ~~$502~~$392 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$178~~$212 million and ~~$155~~$198 million for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. We offer rebates in certain of our markets primarily to support market liquidity and trading volume by providing qualified participants in those markets a discount to the applicable commission rate. Such rebates are calculated based on volumes traded. The increase in the rebates is due primarily to an increase in the number of participants in the rebate programs offered on various contracts, an increase in our traded volume and an increase in the number of rebate programs.

~~Commodities Markets~~Energy Futures and Options Contracts

We operate global crude oil and refined oil futures markets, including the ICE Brent, ICE WTI and ICE Gasoil futures and options contracts, as well as ~~approximately~~over 500 refined oil futures products that relate to our benchmark futures contracts and other key price

benchmarks. The ICE Brent crude contract is relied upon by a broad range of global market participants, including oil producing nations and multinational companies, to price and hedge their crude oil production and consumption. The Brent complex, which includes ICE ~~Gasoil~~Brent crude futures, is a ~~key~~group of related benchmarks used to price an array of traded oil products, including approximately two-thirds of the world’s internationally-traded crude oil. The ICE Low Sulphur Gasoil contract is a European diesel oil contract that offers physical delivery and serves as the leading middle distillate pricing benchmark for refined oil ~~benchmark~~products, particularly in Europe and Asia.

Total oil volume increased 4% and revenues increased ~~18% and 14%, respectively,~~2% for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 from the comparable period in ~~2016~~2017. Total oil volume increased 4% and revenues increased ~~20% and 17%, respectively,~~5% for the three months ended ~~September~~June 30, ~~2017~~2018 from the comparable period in ~~2016.~~2017. ICE Brent crude futures and options volume ~~increased 17% and 18%~~was flat for both the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017, respectively,~~2018 from the comparable periods in ~~2016~~2017 and ICE WTI crude futures and options volume increased ~~23%~~8% and ~~26%~~9% for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016.~~2017. The increase in total oil volume and revenues was primarily driven by ~~price~~ volatility ~~related to shifting supply~~from geopolitical risk and strong global economic performance resulting in increased demand ~~dynamics globally, while~~for crude and refined oil products. Gasoil futures and options volume and revenues ~~grew at a slightly lower rate due to customer~~increased 19% and ~~product mix.~~17%, respectively, for the six months ended June 30, 2018 from the comparable period in 2017 and increased 13% and 11%, respectively, for the three months ended June 30, 2018 from the comparable period in 2017. The increase in total gasoil volume and revenues was primarily driven by increasing demand for distillates and strong economic activity in Europe and Asia.

Our global natural gas futures and options volume ~~increased 3%~~decreased 12% and revenues ~~decreased 1%~~increased 10%, respectively, for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 from the comparable period in ~~2016~~2017 and volume decreased 4%20% and revenues increased 5%12%, respectively, for the three months ended ~~September~~June 30, ~~2017~~2018 from the comparable period in ~~2016.~~2017. Volume ~~increased for the year to date period~~decreased primarily due to ~~growth~~lower price volatility reducing the need for hedging by our commercial client base, and depressed gas prices driven by a continued surplus of natural gas in the first half of 2018 as compared to the same period in 2017. Our U.S. natural gas volume ~~due to greater price volatility~~decrease was partially offset by increased volumes in ~~the first nine months of 2017 than in the comparable period in 2016 and~~European natural gas products. While volumes decreased, revenues ~~decreased~~increased primarily due to ~~increased market making rebates that apply at~~ICE NGX natural gas revenue recognized during the six months ended June 30, 2018 following our December 2017 acquisition. ICE NGX contracts have a higher ~~volume levels~~rate per contract as compared to our other natural gas contracts, and the impact of foreign currency translation in our European natural gas products.

Agricultural and Metals Futures and Options Contracts

Total volume and revenues in our agricultural and metals futures and options markets ~~decreased 9%~~increased 14% and ~~7%, respectively,~~18% for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018, respectively, from the comparable period in ~~2016~~2017, and ~~decreased 7%~~increased 15% and ~~3%, respectively,~~20% for the three months ended ~~September~~June 30, ~~2017~~2018, respectively, from the comparable period in ~~2016.~~2017. Volume in our largest agricultural contract, sugar futures and options, ~~decreased 12%~~increased 16% and 5%20% for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016,~~2017, and other agricultural and metal futures and options volume ~~decreased 6%~~increased 13% and 9%11% for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable ~~period~~periods in ~~2016.~~2017. The ~~decreases~~increases in agricultural ~~volume~~volumes in 2018 compared to 2017 were primarily resulting from price volatility driven by ~~the reduced price volatility in 2017 compared to the higher price volatility in 2016 which was driven by more extreme weather conditions in 2016.~~shifting supply and demand dynamics.

Interest Rates and Other Financial ~~Markets~~Futures and Options Contracts

~~Financial~~Interest rates futures and options volume and revenue increased ~~23%~~8% and 4%21%, respectively, for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 from the comparable period in ~~2016,~~2017, and ~~volume~~increased 10% and ~~revenue increased 19% and 17%~~21%, respectively, for the three months ended ~~September~~June 30, ~~2017~~2018 from the comparable period in ~~2016.~~2017. Interest rate futures and options volume increased ~~37% and 33% for~~during the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017, respectively, from the comparable periods in 2016,~~2018 primarily due to expectations for heightened central bank activity during ~~2017.~~2018. Interest rate futures and options revenues increased ~~less~~more than traded volumes, compared to the prior year ~~periods,~~period, primarily due to the impact of foreign currency translation and ~~increased~~fewer market making ~~rebates that apply at higher volume levels.~~rebates. Other financial futures and options volume decreased ~~14%~~18% and ~~16%~~21%, respectively, for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017, respectively,~~2018 from the comparable periods in ~~2016,~~2017, primarily due to ~~lower price volatility in global equity markets.~~the 2017 termination of our exclusive license to list futures and options contracts on the Russell indexes.

Cash Equities and Equity Options

Cash equities handled volume ~~decreased 18% and 13%~~increased 3% for the ~~nine~~six months ended June 30, 2018 from the comparable period in 2017 primarily due to greater equities market volatility and decreased 3% for the three months ended ~~September~~June 30, ~~2017,~~2018 from the comparable ~~periods~~period in ~~2016, respectively, primarily~~2017 due to a ~~reduction in U.S. equities volatility during 2017~~higher mix of industry volumes on Tapes B and C compared to the same prior year ~~periods.~~period. Cash equities revenues, net of transaction-based expenses, were ~~$149~~$110 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017, a decrease~~2018, an increase of ~~11%~~6% from ~~$166~~$103 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016~~2017 and ~~$46~~$54 million for the three months ended ~~September~~June 30, ~~2017, a decrease~~2018, an increase of 9%3% from ~~$49~~$51 million for the three months ended ~~September~~June 30, ~~2016.~~ 2017.

Equity options volume ~~decreased 16%~~increased 48% and 6%35% for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016, respectively,~~2017, primarily due to ~~lower U.S. equity~~greater equities market ~~volatility.~~volatility during the six months and three months ended June 30, 2018 compared to the prior year periods. Equity options revenues, net of transaction-based expenses, were ~~$67~~$52 million for the ~~nine~~ six

months ended ~~September~~June 30, ~~2017, a decrease~~2018, an increase of 9%12% from ~~$74~~$47 million for the ~~nine~~six months ended ~~September~~June 30, ~~2016~~2017 and ~~$20~~$25 million for the three months ended ~~September~~June 30, ~~2017, a decrease~~2018, an increase of 5%12% from ~~$22~~$23 million for the three months ended ~~September~~June 30, ~~2016.~~2017.

OTC and Other Transactions

CDS clearing revenues were ~~$86~~$73 million and ~~$79~~$56 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$30~~

$31 million and $26 million for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. The notional value of CDS cleared ~~during the same periods were $8.9~~

was $8.5 trillion and ~~$9.0~~$5.6 trillion for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$3.3~~$3.8 trillion and $2.6 trillion for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. The increase in CDS clearing revenues was driven by record buyside clearing during the ~~nine and three~~six months ended ~~September~~June 30, ~~2017. CDS~~2018. OTC revenues also include revenues from BondPoint, our OTC energy business, and other trade execution revenues were $21 million and $30 million for the nine months ended September 30, 2017 and 2016, respectively, and $6 million and $9 million for the three months ended September 30, 2017 and 2016, respectively. The decrease in CDS trade execution revenues for the nine and three months ended September 30, 2017, from the comparable periods in 2016, is primarily due to the sale and discontinuance of our CDS voice brokerage operations in the third quarter of 2016.confirmation services.

Other Revenues

Other revenues primarily include interest income on certain clearing margin deposits, regulatory penalties and fines, fees for use of our facilities, regulatory fees charged to member organizations of our U.S. securities exchanges, designated market maker service fees, exchange membership fees and agricultural grading and certification fees. The increase in other revenues for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018 from the comparable periods in ~~2016,~~2017, is primarily due to ~~a $6 million breakup fee received in August 2017 related to the termination of the derivatives~~increased interest income earned on certain clearing ~~agreement with Euronext NV, under which ICE Clear Netherlands was to provide clearing of Euronext NV’s financial and commodity derivatives.~~margin deposits.

Selected Operating Data

The following charts and table present trading activity in our futures and options markets by commodity type based on the total number of contracts traded, as well as futures and options rate per contract (in millions, except for percentages and rate per contract amounts and YTD represents the ~~nine-month~~six month periods ended ~~September~~June 30th):



Volume and Rates per Contract

Nine Months Ended
September 30, Three Months Ended September 30,
2017 2016 Change 2017 2016 Change
Number of contracts traded:
Brent crude futures and options 199
169
17 % 64
53
18 %
Other oil futures and options 84
69
21
28
23
23
Gasoil futures and options 57
50
15
21
18
25
Natural gas futures and options 164
160
3
47
49
(4 )
Power futures and options 10
11
(13 ) 2
3
(11 )
Emissions and other energy futures and options 7
7
(12 ) 3
2
15
Sugar futures and options 31
36
(12 ) 9
10
(5 )
Other agricultural and metals futures and options 41
43
(6 ) 12
12
(9 )
Interest rates futures and options 410
300
37
122
92
33
Other financial futures and options 98
114
(14 ) 27
35
(16 )
Total 1,101
959
15 % 335
297
13 %

Rate per contract:
Energy futures and options rate per contract $ 1.31
$ 1.37
(5 )% $ 1.35
$ 1.36
(1 )%
Agricultural and metals futures and options rate per contract $ 2.31
$ 2.28
1 % $ 2.32
$ 2.22
4 %
Financial futures and options rate per contract $ 0.48
$ 0.56
(14 )% $ 0.53
$ 0.53
1 %



	Six Months Ended June 30,						Three Months Ended June 30,
	2018		2017		Change		2018		2017		Change
Number of contracts traded:
Energy futures and options	352		355		(1	)%	176		181		(3	)%
Agricultural and metals futures and options	58		52		14		30		27		15
Interest rates and other financial futures and options	369		357		3		186		179		4
Total	779		764		2	%	392		387		1	%

Rate per contract:
Energy futures and options	$	1.38	$	1.29	7	%	$	1.43	$	1.28	11	%
Agricultural and metals futures and options	$	2.38	$	2.31	3	%	$	2.42	$	2.32	4	%
Interest rates and other financial futures and options	$	0.49	$	0.46	6	%	$	0.49	$	0.47	5	%

Open interest is the aggregate number of contracts (long or short) that clearing members hold either for their own account or on behalf of their clients. Open interest refers to the total number of contracts that are currently "open,"– in other words, contracts that have been traded but not yet liquidated by either an offsetting trade, exercise, expiration, or assignment. Open interest is also a measure of the future activity remaining to be closed out in terms of the number of contracts that members and their clients continue to hold in the particular contract and by the number of contracts held for each contract month listed by the exchange. The following charts and table present our quarter-end open interest for our futures and options contracts (in thousands, except for percentages):



Open Interest

As of September 30,
2017 2016 Change
Open interest — in thousands of contracts:
Brent crude futures and options 4,278
4,410
(3 )%
Other oil futures and options 5,824
5,143
13
Gasoil futures and options 1,065
979
9
Natural gas futures and options 18,918
16,736
13
Power futures and options 2,980
3,682
(19 )
Emissions and other energy futures and options 2,199
2,363
(7 )
Sugar futures and options 1,162
1,526
(24 )
Other agricultural and metals futures and options 2,129
2,356
(10 )
Interest rates futures and options 21,913
14,999
46
Other financial futures and options 5,617
5,645
—
Total 66,085
57,839
14 %



	As of June 30,
	2018	2017	Change
Open interest — in thousands of contracts:
Energy futures and options	36,350	35,886	1	%
Agricultural and metals futures and options	3,690	3,359	10
Interest rates and other financial futures and options	28,828	28,144	2
Total	68,868	67,389	2	%

The following charts and table present selected cash ~~equities~~ and equity options trading data (all trading volume below is

presented as net daily trading volume and is single counted and YTD represents the ~~nine-month~~six-month periods ended ~~September~~June 30th):


	Nine Months Ended September 30,						Three Months Ended September 30,						Six Months Ended June 30,						Three Months Ended June 30,
	2017		2016		Change		2017		2016		Change		2018		2017		Change		2018		2017		Change
Cash equities (shares in millions):
NYSE listed (tape A) issues:
Cash products (shares in millions):
NYSE listed (Tape A) issues:
Handled volume	1,101		1,296		(15	)%	1,014		1,121		(10	)%	1,151		1,144		1	%	1,109		1,161		(4	)%
Matched volume	1,091		1,282		(15	)%	1,006		1,111		(9	)%	1,142		1,134		1	%	1,100		1,151		(4	)%
Total NYSE listed consolidated volume	3,463		3,968		(13	)%	3,194		3,475		(8	)%	3,679		3,598		2	%	3,518		3,614		(3	)%
Share of total matched consolidated volume	31.5	%	32.3	%	(0.8 pts)		31.5	%	32.0	%	(0.5 pts)		31.0	%	31.5	%	(0.5 pts)		31.3	%	31.8	%	(0.6 pts)
NYSE Arca, NYSE American and regional listed (tape B) issues:
NYSE Arca, NYSE American and regional listed (Tape B) issues:
Handled volume	298		381		(22	)%	257		329		(22	)%	332		319		4	%	297		316		(6	)%
Matched volume	290		368		(21	)%	250		319		(22	)%	322		310		4	%	289		307		(6	)%
Total NYSE Arca, NYSE American and regional listed consolidated volume	1,222		1,558		(22	)%	1,030		1,321		(22	)%	1,365		1,319		3	%	1,208		1,255		(4	)%
Share of total matched consolidated volume	23.7	%	23.6	%	0.1 pt		24.2	%	24.2	%	0.1 pt		23.6	%	23.5	%	0.1 pts		23.9	%	24.5	%	(0.5 pts)
Nasdaq listed (tape C) issues:
Nasdaq listed (Tape C) issues:
Handled volume	145		197		(26	)%	140		167		(16	)%	175		148		18	%	178		151		18	%
Matched volume	136		187		(27	)%	132		158		(17	)%	165		138		19	%	168		141		19	%
Total Nasdaq listed consolidated volume	1,913		1,932		(1	)%	1,841		1,797		2	%	2,202		1,949		13	%	2,151		2,010		7	%
Share of total matched consolidated volume	7.1	%	9.7	%	(2.6 pts)		7.2	%	8.8	%	(1.7 pts)		7.5	%	7.1	%	0.4 pts		7.8	%	7.0	%	0.8 pts
Total cash handled volume	1,544		1,874		(18	)%	1,411		1,617		(13	)%	1,658		1,611		3	%	1,584		1,628		(3	)%
Total cash market share matched	23.0	%	24.6	%	(1.7 pts)		22.9	%	24.1	%	(1.2 pts)		22.5	%	23.0	%	(0.6 pts)		22.6	%	23.2	%	(0.6 pts)

Equity options (contracts in thousands):
NYSE equity options volume	2,269		2,711		(16	)%	2,348		2,486		(6	)%	3,304		2,229		48	%	3,095		2,286		35	%
Total equity options volume	14,505		14,374		1	%	14,098		13,797		2	%	18,238		14,710		24	%	16,960		14,812		14	%
NYSE share of total equity options	15.6	%	18.9	%	(3.2 pts)		16.7	%	18.0	%	(1.4 pts)		18.1	%	15.2	%	3.0 pts		18.3	%	15.4	%	2.8 pts

Revenue capture or rate per contract:
Cash equities revenue capture (per 100 shares)	$0.051		$0.047		9	%	$0.051		$0.048		6	%
Cash products revenue capture (per 100 shares)													$0.053		$0.052		3	%	$0.053		$0.051		5	%
Equity options rate per contract	$0.158		$0.145		9	%	$0.142		$0.139		2	%	$0.127		$0.167		(24	)%	$0.128		$0.157		(19	)%

Handled volume represents the total number of shares of equity securities, ~~exchange traded funds, or~~ ETFs, and crossing session activity internally matched on our exchanges or routed to and executed on an external market center. Matched volume represents the total number of shares of equity securities, ETFs and crossing session activity executed on our exchanges.

Transaction-Based Expenses

Our equities and equity options markets pay fees to the SEC pursuant to Section 31 of the Securities Exchange Act of 1934, or the Exchange Act. Section 31 fees are recorded on a gross basis as a component of transaction and clearing fee revenue. These Section 31 fees are designed to recover the government’s costs of supervising and regulating the securities markets and securities professionals. We, in turn, collect activity assessment fees, which are included in transaction and clearing revenues in our consolidated statements of income, from member organizations clearing or settling trades on the equities and options exchanges and recognize these amounts when invoiced. The activity assessment fees are designed so that they are equal to the Section 31 fees that are included in transaction-based expenses in our consolidated statements of income. As a result, activity assessment fees and the corresponding Section 31 fees do not have an impact on our net income. Activity assessment fees received are included in cash at the time of receipt and, as required by law, the amount due to the SEC is remitted semi-annually and recorded as an accrued liability until paid. As of ~~September~~June 30, ~~2017,~~2018, the accrued liability related to the un-remitted ~~SEC~~ Section 31 fees was ~~$32~~$209 million.

We also incur liquidity payments made to cash and options trading customers and routing charges made to other exchanges that are included in transaction-based expenses. We incur routing charges when we do not have the best bid or offer in the market for a security that a customer is trying to buy or sell on one of our securities exchanges. In that case, we route the customer’s order to the external market center that displays the best bid or offer. The external market center charges us a fee per share (denominated in tenths of a cent per share) for routing to its system. We record routing charges on a gross basis as a component of transaction and clearing fee revenue.

Operating Expenses, Operating Income and Operating Margin

Our Trading and Clearing segment operating expenses ~~decreased $29~~increased $28 million and ~~$32~~$21 million for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016. During the nine and three months ended September 30, 2016, we recorded a $33 million Creditex customer relationship intangible asset impairment.~~2017. See “- Consolidated Operating Expenses” below for a discussion of the significant changes in our operating expenses. Our Trading and Clearing segment operating income increased ~~$56~~$89 million and ~~$72~~$38 million for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016.~~2017. Trading and Clearing segment operating margins were ~~60%~~65% and ~~58%~~63% for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~59% and 49%~~64% for both the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016, respectively.~~2017.

Our Trading and Clearing segment adjusted operating expenses were ~~$588~~$386 million and ~~$576~~$359 million for the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, respectively. Our Trading and ~~2016, respectively, and $196~~Clearing segment adjusted operating expenses were $195 million and ~~$188~~$181 million for the three months ended ~~September~~June 30, 2018 and 2017, ~~and 2016,~~ respectively. Our Trading and Clearing segment adjusted operating income was ~~$1.0 billion~~$819 million and $729 million for ~~both~~ the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, respectively. Our Trading and ~~2016 and $327~~Clearing segment adjusted operating income was $414 million and ~~$295~~$369 million for the three months ended ~~September~~June 30, 2018 and 2017, ~~and 2016,~~ respectively. Our Trading and Clearing segment adjusted operating margins were ~~63%~~68% and ~~64%~~67% for the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, respectively. Our Trading and ~~2016, respectively,~~Clearing segment adjusted operating margins were 68% and ~~62% and 61%~~67% for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. See “- Non-GAAP Financial Measures” below.

Data and Listings Segment

The following charts and table present our selected statements of income data for our Data and Listings segment (dollars in millions and YTD represents the ~~nine-month~~six-month periods ended ~~September~~June 30th):


	Nine Months Ended September 30,							Three Months Ended September 30,						Six Months Ended June 30,						Three Months Ended June 30,
	2017		2016		Change			2017		2016		Change		2018		2017		Change		2018		2017		Change
Revenues:
Pricing and analytics	$	722	$	624	16	%		$	242	$	209	16	%	$	516	$	480	7	%	$	262	$	242	8	%
Exchange data	416		403		3			136		136		1		287		280		3		144		142		1
Desktops and connectivity	421		436		(4	)		140		144		(4	)	243		281		(14	)	120		137		(12	)
Data services	1,559		1,463		7			518		489		6		1,046		1,041		—		526		521		1
Listings	315		314		—			102		106		(3	)	220		217		1		111		109		2
Revenues	1,874		1,777		5			620		595		4		1,266		1,258		1		637		630		1
Other operating expenses	769		753		2			247		253		(3	)	537		557		(4	)	269		274		(1	)
Acquisition-related transaction and integration costs	27		53		(51	)		4		13		(74	)	25		23		5		13		9		33
Depreciation and amortization	259		274		(5	)	—	83		93		(10	)	179		178		1		91		91		1
Operating expenses	1,055		1,080		(2	)		334		359		(7	)	741		758		(2	)	373		374		—
Operating income	$	819	$	697	18	%		$	286	$	236	22	%	$	525	$	500	5	%	$	264	$	256	3	%

~~The~~Our Data and Listings segment represents subscription-based, or recurring, revenues from data services and listings services offered across our trading and clearing businesses and ICE Data Services. Through ICE Data Services, we generate revenues from a range of ~~market~~global financial and commodity markets, including pricing and reference data, exchange data, analytics, feeds, index services, ~~including the dissemination of our exchange~~desktops and ~~evaluated pricing data and analytics, desktops,~~ connectivity ~~and market data.~~solutions. Through NYSE, NYSE American and NYSE Arca, we generate listings revenue related to the provision of listings services for public companies and ETFs, and related corporate actions for listed companies.

For the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, 8% and ~~2016,~~ 10% ~~and 12%~~, respectively, of our Data and Listings segment revenues were billed in pounds sterling or euros and for the three months ended ~~September~~June 30, 2018 and 2017, 8% and ~~2016,~~ 10% ~~and 12%~~, respectively, were billed in pounds sterling or euros (all relating to our data services revenues). As the pound sterling or euro exchange rate changes, the U.S. equivalent of revenues denominated in foreign currencies changes accordingly. ~~The strengthening of the U.S. dollar compared~~Due to ~~the pound sterling and euro for the nine months ended September 30, 2017, from the comparable period in 2016, reduced our Data and Listings segment revenues by $13 million and~~ the weakening of the U.S. dollar compared to the pound sterling and euro, ~~for the three months ended September 30, 2017, from the comparable period in 2016, increased~~ our Data and Listings segment revenues ~~by $1 million.~~were $9 million higher for the six months ended June 30, 2018, from the comparable period in 2017 and $3 million higher for the three months ended June 30, 2018, from the comparable period in 2017.

Data Services Revenues

Our pricing and analytics services consist of an extensive set of independent continuous and end-of-day evaluated pricing services focused primarily on fixed income and international equity securities, valuation services, reference data, ~~market data, end of day pricing, fixed income, equity~~and multi-asset class portfolio ~~analytics~~ and risk management analytics. We also serve as an administrator of regulated benchmarks. Our index services offer a range of products across fixed income, energy, equities, ETFs and other asset classes to provide the methodology, pricing and licensing of indices and benchmarks.

Our exchange data revenues primarily represent subscription fees for the provision of our market data that is created from activity on our exchanges, which is driven by the products and technology we develop to deliver real-time views of markets and related information. In our derivatives markets, exchange data revenues relate to subscription fees charged for customer and license access from third party data vendors, or quote vendors, ~~such as Thomson Reuters and Bloomberg,~~ and from end users, as well as view-only data access, direct access services, terminal access, daily indices, forward curves, and ~~end of day~~end-of-day reports.

We also earn exchange data revenues relating to our cash equity and options markets, and related data services. We collect cash trading market data fees principally for consortium-based data products and, to a lesser extent, for NYSE proprietary data products. Consortium-based data fees are determined by the securities industry plans and are charged to vendors based on their redistribution of data. Consortium-based data revenues (net of administrative costs) are distributed to participating securities markets on the basis of a formula set by the SEC under Regulation National Market System, or Regulation NMS. Last trade prices and quotes in ~~New York Stock Exchange-listed,~~NYSE-listed, NYSE American-listed, and NYSE Arca-listed securities are disseminated through “Tape A” and “Tape ~~B”,~~B,” which constitute the majority of our revenues from consortium-based market data revenues.

Our ~~desktop~~desktops and connectivity services comprise technology-based information platforms, feeds and connectivity solutions. These include trading applications, desktop solutions, data feeds and infrastructure to support trading, voice brokers and investment ~~functions.~~functions through our ICE Global Network. Our desktop and web-based applications deliver real-time market information, analytical and decision support tools to support trading and investment decisions. Through our consolidated feeds, clients receive market data from global exchanges, trading venues, news and data sources for exchange-traded and OTC markets. Our ~~services offer~~connectivity service, ICE Global Network, offers clients a secure, resilient, private ~~multi-~~

~~participant~~multi-participant network that provides access to global exchanges and content service providers. Our infrastructure managed services solution also offers colocation space, direct exchange access, proximity hosting and support services that enable access to real-time exchange data, and facilitates low latency, secure electronic market access.

Our data services revenues ~~increased 7% and 6%~~were flat for the ~~nine~~six months ended June 30, 2018 and increased 1% for the three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016,~~2017, primarily due to the strong retention rate of existing customers, the addition of new customers, increased purchases by existing customers, ~~the development of new and enhanced products serving the need for an expanded range of data, regulatory compliance and analytics solutions, and~~ our acquisitions of ~~Securities Evaluations~~TMX Atrium in May 2017 and ~~Credit Market Analysis from S&P~~Bank of America Merrill Lynch, or BofAML’s, Global Research Division’s index business in October ~~2016. These increases were partially offset by~~2017 and the impact of foreign currency ~~translation~~translation. These increases were offset by the divestitures of IDMS in March 2017 and ~~the divestiture of IDMS~~Trayport in December 2017 in our desktop and connectivity business.

Annual Subscription Value (ASV)

Annual Subscription Value, or ASV, represents, at a point in time, the data services revenues subscribed for the succeeding twelve months. ASV does not include new sales, contract terminations or price changes that may occur during that ~~12-month~~twelve-month period. ASV also does not include certain data services revenue streams that are not subscription-based. Revenue from ASV businesses has historically represented approximately 90% of our data revenues. Organic ASV is adjusted for ~~material~~ acquisitions, divestitures or discontinued businesses to provide an organic view of comparable performance on a ~~year over year~~year-over-year basis at athe beginning of the ~~quarter.~~quarter, and is calculated using the current spot rate. Prior period comparisons have been adjusted to use the current period spot rates for both the pound sterling and the euro. Thus, while it is an indicative ~~backward-looking~~forward-looking metric, it does not provide a growth forecast of the next twelve months of data services revenues.

As of ~~September~~June 30, ~~2017,~~2018, ASV was ~~$1.7~~$1.883 billion. Organic ASV was $1.846 billion, ~~a 6% increase~~which increased 6.3% compared to the organic ASV ~~of $1.7 billion~~ as of ~~September~~June 30, ~~2016.~~2017. Underpinning this growth is strength in both our pricing and analytics business and our connectivity ~~services business lines.~~services.

Listings Revenues

We recognize listings revenues in our securities markets from fees applicable to companies listed on our cash equities exchanges -– original listing fees and annual listing fees. Original listing fees consist of two components: initial listing fees and fees related to ~~corporate-related~~corporate actions. Initial listing fees, subject to a minimum and maximum amount, are based on the number of shares that a company initially lists. ~~Initial listing~~All listings fees are billed upfront and the identified performance obligations are satisfied over time. Upon our January 1, 2018 adoption of the ASC 606 accounting framework, revenue related to the investor relations performance obligation is recognized ratably over a two-year period, with the remaining revenue recognized ratably over time as ~~revenue~~customers continue to list on our exchanges, which is generally estimated to be over a ~~straight-line basis over estimated service periods~~period of up to nine years for NYSE and up to five years for NYSE Arca and NYSE American. U.S. companies pay annual fees based on the number of outstanding shares the company has and non-U.S. companies pay annual fees based on the number of outstanding shares the company has issued or held in the U.S. Annual fees are recognized as revenue on a pro rata basis over the calendar year, and generally received as cash in the first quarter of the year.

In addition, we earn corporate actions-related listing fees in connection with actions involving the issuance of new shares, such as stock splits, rights issues and sales of additional securities, as well as mergers and acquisitions. ~~Corporate actions-related~~Listings fees related to other corporate actions are considered contract modifications of our listing ~~fees~~contracts and are recognized ratably over time as ~~revenue~~customers continue to list on our exchanges, which is generally estimated to be a ~~straight-line basis over estimated service periods~~period of six years for NYSE and three years for NYSE Arca and NYSE American. ~~Unamortized balances are recorded as deferred revenue in our consolidated balance sheet.~~

Operating Expenses, Operating Income and Operating Margin

Our Data and Listings segment operating expenses decreased ~~$25~~$17 million and $1 million for ~~both~~ the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018, respectively, from the comparable periods in ~~2016.~~2017. See “- Consolidated Operating Expenses” below for a discussion of the significant changes in our operating expenses. Our Data and Listings segment operating income increased ~~$122~~ $25

million and ~~$50~~$8 million for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable periods in ~~2016.~~2017. Our Data and Listings segment operating margins were ~~44% and 39% for the nine months ended September 30, 2017 and 2016, respectively, and 46%~~42% and 40% for the six months ended June 30, 2018 and 2017, respectively, and 41% for both the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016, respectively.~~2017. The operating income and operating margin increases were ~~primarily~~ driven by the ~~data~~ revenue increases discussed above.

Our Data and Listings segment adjusted operating expenses were ~~$871~~$611 million and ~~$878~~$628 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$280~~$308 million and ~~$296~~$309 million for the three months ended ~~September~~June 30, 2018 and 2017, ~~and 2016,~~ respectively. Our Data and Listings segment adjusted operating income was ~~$1.0 billion~~$655 million and ~~$899~~$630 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$340~~$329 million and ~~$299~~$321 million for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. Data and Listings segment adjusted operating margins were ~~54%~~52% and ~~51%~~50% for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~55%~~52% and ~~50%~~51% for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. See “- Non-GAAP Financial Measures” below.

Consolidated Operating Expenses

The following chart and table present our consolidated operating expenses (dollars in millions and YTD represents the ~~nine-month~~ six-month

periods ended ~~September~~June 30th):


	Nine Months Ended September 30,						Three Months Ended September 30,						Six Months Ended June 30,						Three Months Ended June 30,
	2017		2016		Change		2017		2016		Change		2018		2017		Change		2018		2017		Change
Compensation and benefits	$	710	$	708	—	%	$	231	$	236	(2	)%	$	481	$	483	—	%	$	241	$	236	2	%
Professional services	94		101		(7	)	30		32		(7	)	59		64		(8	)	29		32		(6	)
Acquisition-related transaction and integration costs	27		61		(56	)	4		14		(75	)	27		23		16		15		9		56
Technology and communication	294		277		6		99		93		6		213		195		9		108		97		10
Rent and occupancy	52		52		—		17		17		2		33		35		(5	)	16		17		(3	)
Selling, general and administrative	117		83		41		38		31		20		72		79		(9	)	39		38		3
Depreciation and amortization	404		470		(14	)	128		181		(29	)	281		276		2		143		142		1
Total operating expenses	$	1,698	$	1,752	(3	)%	$	547	$	604	(10	)%	$	1,166	$	1,155	1	%	$	591	$	571	4	%

For the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, 13% and ~~2016,~~ 15% ~~and 18%~~, respectively, of our consolidated operating expenses were incurred in pounds sterling or euros and ~~14%~~13% and ~~16%~~14%, respectively, for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016~~2017 were billed in pounds sterling or euros. As the pound sterling or euro exchange rate changes, the U.S. equivalent of operating expenses denominated in foreign currencies changes accordingly. ~~The strengthening of the U.S. dollar compared~~Due to ~~the pound sterling and euro for the nine months ended September 30, 2017, from the comparable period in 2016, decreased our consolidated operating expenses by $19 million and~~ the weakening of the U.S. dollar compared to the pound sterling and euro, our consolidated operating expenses increased $14 million and $5 million, for the six months ended and the three months ended ~~September~~June 30, ~~2017,~~2018, respectively, from the comparable ~~period~~periods in ~~2016, increased our consolidated operating expenses by $1 million.~~2017. See Item 3 “- Quantitative and Qualitative Disclosures About Market Risk - Foreign Currency Exchange Rate Risk” below for additional information on the impact of currency fluctuations.

As of ~~September~~June 30, 2018, we had 4,867 employees and as of June 30, 2017, we had ~~5,100 employees and as of September 30, 2016, we had 5,447~~5,128 employees. Our employee headcount decreased over the last year primarily due to employee departures in connection with the divestiture of ~~IDMS~~Trayport in ~~March~~December 2017, the divestiture of NYSE Governance Services in June 2017, and continued employee terminations ~~in connection~~associated with our integration of Interactive Data. These decreases in our employee headcount were partially offset by new employees related to the acquisitions of ~~Securities Evaluations and Credit Market Analysis~~BondPoint in January 2018, ICE NGX in December 2017, BofAML’s Global Research Division’s index business in October ~~2016~~2017 and TMX Atrium in May ~~2017 (see “- Recent Developments” above).~~2017. Non-cash compensation expenses recognized in our consolidated financial statements for employee stock options and restricted stock were ~~$102~~$61 million and ~~$90~~$68 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$34~~$32 million and ~~$30~~$34 million for the three months ended ~~September~~June 30,

~~2017~~ 2018 and ~~2016,~~2017, respectively. We incurred non-acquisition related employee severance costs of ~~$16~~$17 million and ~~$10~~$8 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and $8 million and $7$5 million for the three months ended ~~September~~June 30, 2018 and 2017, ~~and 2016, respectively, including $4 million in severance costs related to Creditex’s U.K. voice brokerage operations discontinuance during the nine and three months ended ended September 30, 2016.~~respectively.

Our compensation and benefits expenses increased for the nine months ended September 30, 2017, from the comparable period in 2016, primarily due to the integration of the Interactive Data employees into the ICE incentive plans during 2017, partially offset by the net decrease in our employee headcount, the foreign currency decrease relating to our U.K. and European based employees compensation expenses incurred in pounds sterling or euros, and the decrease in the non-acquisition related employee severance costs. Our compensation and benefits expenses decreased for the ~~three~~six months ended ~~September~~June 30, ~~2017~~2018, from the comparable period in ~~2016,~~2017, primarily due to the ~~reduction~~net decrease in our employee headcount and a decrease in non-cash compensation expense. Our compensation and benefits expenses increased during the three months ended June 30, 2018 from the ~~IDMS and NYSE Governance Services divestitures.~~comparable period in 2017 primarily due to non-acquisition related employee severance costs.

We incurred acquisition-related transaction and integration costs of $27 million and $4$23 million during the ~~nine~~six months ended June 30, 2018, and 2017 respectively, and $15 million and $9 million during the three months ended ~~September~~June 30, 2018 and 2017, respectively, primarily relating to our ~~integrations~~integration of Interactive Data, Securities Evaluations and Credit Market Analysis. ~~We incurred acquisition-related transaction and~~These integration costs ~~of $61 million and $14 million during the nine and three months ended September 30, 2016, respectively,~~are primarily relating to our integration of Interactive Data, Trayport and NYSE, our investment in MERS, our acquisition of Securities Evaluations and Credit Market Analysis, and various other potential and discontinued acquisitions. The integration costs primarily relaterelated to employee termination, lease termination and professional services costs.

Technology and communication expenses increased for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, from the comparable periods in ~~2016,~~2017, primarily due to ~~the acquisitions of Securities Evaluations and Credit Market Analysis.~~increased hosting costs.

Selling, general and administrative expenses ~~increased~~decreased for the ~~nine and three~~six months ended ~~September~~June 30, ~~2017,~~2018, from the comparable ~~periods~~period in ~~2016,~~2017, primarily due to ~~the acquisitions of Securities Evaluations and Credit Market Analysis, $14~~a $10 million ~~and $4 million in accruals~~accrual made during the ~~nine and three~~six months ended ~~September~~June 30, 2017 ~~respectively,~~ relating to ~~ongoing~~SEC investigations and ~~inquiries, and the release of non-income-related tax reserves of $18 million during the nine months ended September 30, 2016.~~inquiries. See Part II, Item 1 “- Legal Proceedings” below for additional information on the accruals for ~~the ongoing investigations and inquiries.~~these matters.

We recorded amortization expenses on the intangible assets acquired as part of our acquisitions, as well as on other intangible assets, of ~~$206~~$142 million for both the six months ended June 30, 2018 and 2017, and $73 million and ~~$246 million for the nine months ended September 30, 2017 and 2016, respectively, and $64 million and $82~~$72 million for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. We recorded depreciation expenses on our fixed assets of ~~$192~~$139 million and ~~$191~~$128 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$64~~$70 million and ~~$66~~$64 million for the three months ended ~~September~~June 30, 2018 and 2017, respectively. Amortization expenses recorded for the six months and three months ended June 30, 2018, include a $4 million impairment loss of exchange registration intangible assets related to our closure of ICE Futures Canada and ICE Clear Canada. Amortization expenses recorded for the six months and three months ended June 30, 2017 ~~and 2016, respectively. In addition, we recognized~~include a net loss of $6 million on the sale of NYSE Governance ~~Services, which was~~Services. Amortization expense recorded ~~in depreciation and amortization expenses for~~on our Russell license intangible assets decreased during the ~~nine~~six months ended September 30, 2017 (see “- Recent Developments” above) and we recorded an impairment of the Creditex customer relationship intangible asset of $33 million in September 2016, which was recorded in depreciation and amortization expenses for the nine and three months ended ~~September~~June 30, ~~2016. The~~2018 from the same prior year periods because they became fully amortized. This decrease in amortization expense was partially offset by amortization expense on ICE NGX, BondPoint, BofAML Indices and TMX Atrium intangible assets. The increase in depreciation expense recorded during the ~~amortization expenses recorded on the intangibles assets for the nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, from the comparable ~~periods~~period in ~~2016,~~2017 is primarily due to a reduction in amortization expenses recorded on intangible assets which became fully amortized (primarily related to certain of the NYSE intangible assets), partially offset by amortization expenses on the Securities Evaluations, Credit Market Analysis and TMX Atrium intangible assets.

In August 2016, we sold certain of Creditex’s U.S. voice brokerage operations to Tullett Prebon. During the third quarter of 2016, we discontinued Creditex’s U.K. voice brokerage operations. We continue to operate Creditex's electronically traded markets and systems, post-trade connectivity platforms and intellectual property. In connection with the divesting of the voice brokerage business, it was determined that the carrying value of the CDS Creditex customer relationship intangible asset was not fully recoverable and an impairment of the asset was recorded in September 2016 for $33 million.depreciation resulting from increased software development.

Consolidated Non-Operating Income (Expense)

Income and expenses incurred through activities outside of our core operations are considered non-operating. The following table presents our non-operating income (expenses) (dollars in millions):


	Nine Months Ended September 30,								Three Months Ended September 30,								Six Months Ended June 30,								Three Months Ended June 30,
	2017			2016			Change		2017			2016			Change		2018			2017			Change		2018			2017			Change
Other income (expense):
Interest expense	$	(137	)	$	(134	)	2	%	$	(47	)	$	(44	)	7	%	$	(107	)	$	(90	)	20	%	$	(55	)	$	(45	)	23	%
Other income, net	198			24			n/a		11			13			(12)		30			191			(84)		11			3			360
Total other income (expense), net	$	61		$	(110	)	n/a		$	(36	)	$	(31	)	14	%	$	(77	)	$	101		n/a		$	(44	)	$	(42	)	3	%
Net income attributable to non-controlling interest	$	(22	)	$	(20	)	10	%	$	(6	)	$	(6	)	1	%	$	(17	)	$	(16	)	9	%	$	(7	)	$	(8	)	(10	)%

Interest expense increased for the six months and three months ended June 30, 2018 from the comparable periods in 2017, primarily due to a rise in short-term interest rates impacting our Commercial Paper Program, along with interest expense related to our bond refinancing in August 2017.

We recognized equity income relating to our ownership in ~~MERSCORP Holdings, Inc., owner of Mortgage Electronic Registrations Systems, Inc., or collectively~~ MERS, ~~which we acquired in the third quarter of 2016,~~ and The Options Clearing Corporation, or OCC, in other income, which was ~~$23~~$14 million and ~~$15~~$13 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and $10 million and $8 million for the three months ended ~~September~~June 30, 2018 and 2017, ~~and 2016,~~ respectively. We account for these investments as equity investments.

In connection with Cetip’s merger with ~~BM&FBOVESPA S.A.,~~B3 on March 29, 2017, we recognized a $176 million realized investment gain in other income for the ~~nine~~six months ended ~~September~~June 30, 2017 and we recognized $9 million in foreign exchange losses and transaction expenses in

other expense for the ~~nine~~six months and three months ended ~~September~~June 30, 2017. ~~See “- Recent Developments - Cetip Investment Gain” above.~~ We recognized dividend income received relating to our investment in Cetip in other income of $5 million ~~and $12 million~~ for the ~~nine~~six months ended ~~September~~June 30, ~~2017 and 2016, respectively, and $4 million for the three months ended September 30, 2016.~~2017. We ~~will~~ no longer receive any dividends from Cetip ~~or B3~~ subsequent to its sale in the first quarter of 2017.

In connection with our equity investment in Euroclear, we recognized dividend income of $15 million for the six months ended June 30, 2018, which is included in other income.

In connection with our adoption of ASU 2017-07, we are recognizing the other components of net benefit cost of our defined benefit plans in the income statement outside of operating income on a full retrospective basis. The combined net periodic (expense) benefit of these plans was ($4 million) and $4 million for the six months ended June 30, 2018 and 2017, respectively, and ($2 million) and $2 million for the three months ended June 30, 2018 and 2017, respectively.

We incurred foreign currency transaction losses of $2$1 million for both the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018 and ~~there was no impact for the nine months ended September 30, 2016. We incurred foreign currency transaction (losses) gains of ($1 million)~~2017, and $1 million for both the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016, respectively. This was primarily attributable to the fluctuations of the pound sterling and euro relative to the U.S. dollar.~~2017. Foreign currency gains and losses are recorded in other income, ~~(expense) and relate to~~net, when the settlement of foreign currency assets, liabilities and payables that occur through our foreign operations ~~that~~ are received in non-functional currencies due to the increase or decrease in the period-end foreign currency exchange rates between periods.

For consolidated subsidiaries in which our ownership is less than 100%, and for which we have control over the assets, liabilities and management of the entity, the outside stockholders’ interests are shown as non-controlling interest in our consolidated financial statements. As of ~~December 31, 2016,~~June 30, 2018, non-controlling interest ~~included~~includes those related to the operating results of our CDS clearing subsidiaries in which non-ICE limited partners ~~held~~hold a ~~42.5%~~29.9% net profit sharing interest; ICE Endex in which Gasunie held a 21% ownership interest; and ICE Clear Netherlands in which ABN AMRO Clearing Bank N.V. held a 25% ownership interest. For both ICE Endex and ICE Clear Netherlands, in addition to the non-controlling interest reported in the consolidated statements of income, we reported redeemable non-controlling interest in ~~the consolidated balance sheets which represents the minority interest redemption fair value for each company.~~

our CDS clearing subsidiaries. During June 2017, we purchased both ~~Gasunie’s~~N.V. Nederlandse Gasunie's 21% minority ownership interest in ICE Endex and ABN AMRO Clearing Bank N.V.’s 25% minority ownership interest in ICE Clear Netherlands. Subsequent to these acquisitions, we own 100% of ICE Endex and ICE Clear Netherlands and ~~will~~ no longer include any non-controlling interest amounts for ICE Endex and ICE Clear Netherlands in our consolidated financial statements. During April 2017, we purchased 3.2% of the net profit sharing interest in our CDS clearing subsidiaries from a non-ICE limited partner and the remaining non-ICE limited partners hold a 39.3% net profit sharing interest as of September 30, 2017.

Consolidated Income Tax Provision

Consolidated income tax expense was ~~$537~~$292 million and ~~$409~~$354 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~$185~~$149 million and ~~$93~~$140 million for the three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. The change in consolidated income tax expense between periods is primarily due to the tax impact of changes in our pre-tax income and the changes in our effective tax rate each period. Our effective tax rate was ~~29%~~24% and 27% for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and ~~33%~~24% and ~~21%~~25% for the three months ended ~~September~~June 30, 2018 and 2017, ~~and 2016,~~ respectively.

The effective tax rates for the ~~nine~~six months and three months ended ~~September~~June 30, 2018 as compared to the same periods in 2017 ~~and 2016~~ were lower ~~than the federal statutory rate~~ primarily due to ~~favorable foreign~~the reduced U.S. federal corporate income tax rate ~~differentials, deferred~~of 21%, enacted under the TCJA in December 2017 but effective January 1, 2018. That benefit was partially offset by additional U.S. federal and state income taxes on a portion of our foreign income due to certain international tax ~~benefits~~provisions enacted as ~~a result~~part of ~~a U.K. income tax rate reduction enacted in~~ the ~~third quarter of 2016, and~~TCJA, as well as tax benefits associated with a divestiture in the ~~second quarter of 2017, partially offset by state income taxes including additional tax expense from an Illinois corporate~~comparable periods in 2017.

We recorded our income tax ~~rate increase~~provision based on the TCJA and related state provisions, as enacted as of June 30, 2018. Any potential federal or state administrative and/or legislative adjustments to certain provisions in the ~~third~~

~~quarter of 2017. Favorable foreign income tax rate differentials result primarily from lower income tax rates in the U.K.~~TCJA and ~~various other lower tax jurisdictions as compared to the income tax rates in the U.S.~~

The effective tax rate for the three months ended September 30, 2017 is higher than the effective tax rate for the comparable period in 2016 primarily because of deferred tax benefits from a U.K. corporate income tax reduction in the third quarter of 2016 and additional tax expense as a result of an Illinois corporate income tax rate increase enacted in the third quarter of 2017. The same U.K. and Illinois factors affect the effective tax rate comparison for the nine months ended September 30, 2017 and 2016. Additionally, the nine month effective tax rate difference is impacted by tax benefits associated with a divestiture during the second quarter of 2017, partially offset by an income tax expense increase due to a relatively higher U.S. mix of income.related state provisions have not been taken into consideration.

Quarterly Results of Operations

The following quarterly unaudited consolidated statements of income data have been prepared on substantially the same basis as our audited consolidated financial statements and include all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of our consolidated results of operations for the quarters presented. The historical results for any quarter do not necessarily indicate the results expected for any future period. The following table sets forth quarterly consolidated statements of

income data (in millions):


	Three Months Ended,															Three Months Ended,
	September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016			September 30, 2016			June 30, 2018			March 31, 2018			December 31, 2017			September 30, 2017			June 30, 2017
Revenues:
Brent crude futures and options contracts	$	80		$	89		$	80		$	75		$	70
Other oil futures and options contracts	35			34			35			32			30
Gasoil futures and options contracts	32			27			26			25			25
Natural gas futures and options contracts	48			50			55			54			46
Power futures and options contracts	15			19			18			21			18
Emissions and other energy futures and options contracts	13			12			14			17			10
Sugar futures and options contracts	23			29			26			18			25
Other agricultural and metals futures and options contracts	26			33			30			29			27
Interest rates futures and options contracts	48			52			49			40			37
Other financial futures and options contracts	34			37			34			34			33
Energy futures and options contracts																$	250		$	235		$	227		$	223		$	231
Agricultural and metals futures and options contracts																74			65			49			49			62
Interest rates and other financial futures and options contracts																94			91			72			82			89
Cash equities and equity options	355			390			381			426			410			389			438			365			355			390
Credit default swaps	37			33			37			34			35
Other transactions	12			12			13			13			11
OTC and other transactions																57			69			45			49			45
Total transaction and clearing, net	758			817			798			818			777			864			898			758			758			817
Pricing and analytics	242			242			238			234			209			262			254			248			242			242
Exchange data	136			142			138			132			136			144			143			140			136			142
Desktops and connectivity	140			137			144			149			144			120			123			137			140			137
Total data services	518			521			520			515			489			526			520			525			518			521
Listings	102			107			106			105			106			111			109			104			105			109
Other revenues	54			49			45			46			44			55			53			54			54			49
Total Revenues	1,432			1,494			1,469			1,484			1,416			1,556			1,580			1,441			1,435			1,496
Transaction-based expenses	289			316			305			346			338			310			355			295			289			316
Total revenues, less transaction-based expenses	1,143			1,178			1,164			1,138			1,078			1,246			1,225			1,146			1,146			1,180
Compensation and benefits	231			234			245			237			236			241			240			229			234			236
Professional services	30			32			32			36			32			29			30			27			30			32
Acquisition-related transaction and integration costs	4			9			14			19			14			15			12			9			4			9
Technology and communication	99			97			98			97			93			108			105			103			99			97
Rent and occupancy	17			17			18			18			17			16			17			17			17			17
Selling, general and administrative	38			38			41			33			31			39			33			38			38			38
Depreciation and amortization ⁽¹⁾	128			142			134			140			181
Depreciation and amortization																143			138			131			128			142
Total operating expenses	547			569			582			580			604			591			575			554			550			571
Operating income	596			609			582			558			474			655			650			592			596			609
Other income (expense), net ⁽²⁾	(36		)	(44		)	141			(28		)	(31		)
Income tax expense ⁽³⁾	185			139			213			171			93
Other income (expense), net ⁽¹⁾																(44		)	(33		)	79			(33		)	(42		)
Income tax expense (benefit) ⁽²⁾																149			143			(568		)	186			140
Net income	$	375		$	426		$	510		$	359		$	350		$	462		$	474		$	1,239		$	377		$	427
Net income attributable to non-controlling interest	(6		)	(8		)	(8		)	(7		)	(6		)	(7		)	(10		)	(6		)	(6		)	(8		)
Net income attributable to ICE	$	369		$	418		$	502		$	352		$	344		$	455		$	464		$	1,233		$	371		$	419

⁽¹⁾The depreciation and amortization expenses for the three months ended September 30, 2016 include a $33 million Creditex customer relationship intangible asset impairment, and for the three months ended June 30, 2017 include a $6 million net loss on the sale of NYSE Governance Services.

⁽²⁾~~In connection with Cetip’s merger with BM&FBOVESPA S.A., we recognized a $176 million realized investment gain in other~~Other income (expense), net, for the three months ended ~~March~~December 31, 2017 ~~and $9~~includes a $110 million ~~in foreign losses and transaction expenses in other~~gain on our sale of Trayport. Other income (expense), net, for the three months ended June 30, ~~2017.~~2017 includes $9 million in foreign tax losses and transaction expenses in relation to Cetip's merger with B3.

⁽³⁾⁽²⁾The decrease in the income tax ~~expense~~expenses for the three months ended ~~September 30, 2016 includes~~December 31, 2017 is primarily due to a $764 million deferred tax benefit associated with future ~~U.K.~~U.S. income tax ~~rate~~ reductions.

Liquidity and Capital Resources

Below are charts that reflect our capital allocation. The acquisition and integration costs in the chart below includes both the cash paid for the acquisitions and the acquisition-related transaction and integration costs in each period (YTD represents the ~~nine-month~~six-month periods ended ~~September~~June 30th):

We have financed our operations, growth and cash needs primarily through income from operations and borrowings under our various debt facilities. Our principal capital requirements have been to fund capital expenditures, working capital, strategic acquisitions and investments, stock repurchases, dividends to our ~~shareholders~~stockholders and the continued development of our technology platforms that support our businesses. We believe that our cash on hand and cash flows from operations will be sufficient to repay our outstanding debt ~~as it matures. In the future,~~but we may also need to incur additional debt or issue additional equity securities ~~which we may be unable to do or to do on favorable terms.~~in the future. See “- Future Capital Requirements” below.

Our ~~commercial paper program~~Commercial Paper Program enables us to borrow efficiently at reasonable ~~short term~~short-term interest rates and provides us with the flexibility to de-lever using our strong annual cash flows from operating activities whenever our leverage becomes elevated as a result of investment or acquisition activities. ~~We reduced our outstanding commercial paper during~~During the ~~nine~~six months ended ~~September~~June 30, ~~2017 by $445~~2018, we used net proceeds of $812 million from notes issued under our Commercial Paper Program primarily ~~using net~~to finance the acquisition of BondPoint, to purchase an additional 5.1% stake in Euroclear, and for general corporate purposes. See “- Debt” below.

See “- Recent Developments” above for a discussion of the acquisitions and investments that we made during and subsequent to the six months ended June 30, 2018. These cash ~~proceeds received~~acquisitions and investments were funded primarily from ~~the sale of~~borrowing under our ~~investment in Cetip and~~Commercial Paper Program along with cash flows from operations. ~~See “- Recent Developments - Cetip Investment Gain” above and “- Debt” below.~~

Upon maturity of old issuances of commercial paper and to the extent old issuances are not repaid by cash on hand, we are exposed to the rollover risk of not being able to issue new commercial paper. To mitigate the rollover risk, we maintain an undrawn back-stop bank revolving credit facility for an aggregate amount equaling at any time the amount issued under our ~~commercial paper program.~~Commercial Paper Program. If we were not able to issue new commercial paper, we have the option of drawing on the back-stop revolving ~~facility, however~~facility. However electing to do so would result in higher interest expense. See “- Debt” below.

Consolidated cash and cash equivalents were ~~$419~~$532 million and ~~$407~~$535 million as of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, respectively, and short-term and long-term restricted cash and ~~investments~~cash equivalents were $1.1 billion and $1.0 billion ~~and $943 million~~ as of ~~September~~June 30, ~~2017~~ 2018

and December 31, ~~2016,~~2017, respectively.

As of ~~September~~June 30, ~~2017,~~2018, the amount of ~~unrestricted~~ cash and cash equivalents held by our non-U.S. subsidiaries was ~~$246~~$306 million. While we consider our non-U.S. earnings to be indefinitely reinvested overseas, if these cash balances are needed for our operations in the U.S., any repatriation by way of dividend may be subject to both U.S. federal and state income taxes, as adjusted for any non-U.S. tax credits. However, we do not have any current needs or foreseeable future needs or other plans to repatriate cash by way of dividends from our non-U.S. subsidiaries.

Our board of directors has adopted a quarterly dividend declaration policy providing that the declaration of any dividends will be approved quarterly by the board of directors or audit committee of the board of directors taking into account such factors as our evolving business model, prevailing business conditions and our financial results and capital requirements, without a predetermined annual net income payout ratio. During the third quarter of 2017, we paid a quarterly dividend of $0.20 per share of our common stock for an aggregate payout of $119 million, and the aggregate dividend payout for the nine months ended September 30, 2017 was $358 million. On November 2, 2017, we announced a $0.20 per share dividend for the fourth quarter of 2017 with the dividend payable on December 29, 2017 to shareholders of record as of December 14, 2017.

In August 2016, our board of directors approved an aggregate of $1.0 billion for future repurchases of our common stock with no fixed expiration date, subject to applicable laws and regulations. During the three months ended December 31, 2016, we repurchased 902,920 shares of our outstanding common stock at a cost of $50 million, and during the nine months ended September 30, 2017, we repurchased 11,469,042 shares of our outstanding common stock at a cost of $709 million, excluding shares withheld upon vesting of equity awards. These repurchases were completed on the open market and under our 10b5-1 trading plan. As of September 30, 2017, the remaining board authorization permits repurchases of up to $241 million of our common stock. In September 2017, our ~~board~~Board of ~~directors~~Directors approved an aggregate of $1.2 billion for future repurchases of our common stock with no fixed expiration date that ~~becomes~~became effective ~~as of~~on January 1, 2018. We expect funding for any stock repurchases to come from our operating cash flow or borrowings under our debt facilities or our Commercial Paper Program. During the six months ended June 30, 2018, we repurchased 10,403,246 shares of our outstanding common stock at a cost of $759 million, excluding shares withheld upon vesting of equity awards. These repurchases are held in treasury stock and were completed on the open market and under our Rule 10b5-1 trading plan. As of June 30, 2018, the remaining board authorization permits repurchases of up to $441 million of our common stock. Refer to ~~note 7~~Note 8 to our consolidated financial statements and related notes, which are included elsewhere in this Quarterly Report, for more information on our stock repurchase program.

Cash Flows

The following tables present the major components of net increases (decreases) in cash, cash equivalents, and restricted cash and cash equivalents (in millions):


	Nine Months Ended September 30,						Six Months Ended June 30,
	2017			2016			2018			2017
Net cash provided by (used in):
Operating activities	$	1,410		$	1,508		$	1,236		$	1,099
Investing activities	127			(306		)	(818		)	298
Financing activities	(1,534		)	(1,366		)	(301		)	(1,321		)
Effect of exchange rate changes	9			(5		)	(5		)	5
Net increase (decrease) in cash and cash equivalents	$	12		$	(169	)
Net increase in cash, cash equivalents and restricted cash and cash equivalents							$	112		$	81

In the fourth quarter of 2017, we adopted ASU 2016-18, which requires us to show the changes in the total of cash, cash equivalents, restricted cash and cash equivalents in the statement of cash flows. As a result, we no longer present transfers between cash and cash equivalents and restricted cash and cash equivalents in the statement of cash flows. We have reclassified changes in restricted cash from cash flows provided by (used in) investing activities, to the total change in beginning and end-of-year total changes. Our statements of cash flows for the six months ended June 30, 2018 and 2017 reflect this change.

Operating Activities

Net cash provided by operating activities primarily consists of net income adjusted for certain non-cash items, including depreciation and amortization and the effects of changes in working capital. ~~Fluctuations~~The $137 million increase in net cash provided by operating activities ~~are~~during the six months ended June 30, 2018 as compared to the prior period in 2017 is primarily ~~attributable to increases and decreases~~a result of the increase in our ~~net~~operating income ~~between periods~~ and ~~due to~~ fluctuations in our working capital. The $98 million decrease in net cash provided by operating activities for the nine months ended September 30, 2017, from the comparable period in 2016, is primarily due to a $136 million contribution that was made to our pension plan in September 2017, compared to a $10 million contribution that was made to our pension plan in September 2016. The pension contribution in September 2017 allowed us to reach 99% funding of our pension obligation and allowed us to immunize the liability against future market fluctuations. For additional information on our pension plan, refer to note 14 to our consolidated financial statements and related notes in Part II, Item 8, “Financial Statements and Supplementary Data”, in our 2016 Form 10-K.

Investing Activities

Consolidated net cash used in investing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016~~2017 primarily relates to ~~the~~purchases of equity investments, net cash ~~received~~proceeds from our sale of Cetip, cash paid for acquisitions (net of cash received for divestitures) including our January 2018 acquisition of BondPoint for $400 million, and increases in our capital expenditures and capitalized software development ~~costs, and changes in our restricted cash.~~costs. See “- Recent Developments” above. We received net cash proceeds from the sale of Cetip of $438 ~~million. See “- Recent Developments” above.~~million during the six months ended June 30, 2017.

We purchased an additional 5.1% stake in Euroclear for €246 million in cash ($304 million based on a euro/U.S. dollar exchange rate at February 21, 2018). We received cash from the divestitures of IDMS and NYSE Governance Services, net of the cash paid for the NYSE National and TMX Atrium acquisitions, of $10 million for the six months ended June 30, 2017. We had capital expenditures of ~~$136~~$33 million and ~~$166~~$81 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively, and we had capitalized software development expenditures of ~~$104~~$75 million and ~~$88~~$69 million for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. The capital expenditures primarily relate to ~~hardware~~hardware/software purchases to continue the development and expansion of our electronic platforms, data services and clearing houses and leasehold improvements associated with the ~~new and~~ renovated office spaces in Atlanta, New York and London. The software development expenditures primarily relate to the continued development and expansion of our electronic trading platforms, data services and clearing houses.

We had net increase/(decrease) in restricted cash and investments of $80 million and ($18 million) for the nine months ended September 30, 2017 and 2016, respectively. The net restricted cash increase for the nine months ended September 30, 2017 primarily related to increases in the regulatory capital restricted cash at ICE Clear Europe and ICE Clear US primarily due to revenue increases,

additional costs incurred due to the growth of our clearing businesses and additional regulatory capital buffers. The net restricted cash decrease for the nine months ended September 30, 2016 primarily related to the elimination of the regulatory capital restricted cash at LIFFE Administration and Management, or Liffe, and a decrease in the restricted cash held as escrow for the SuperDerivatives acquisition. The restricted cash decreases in 2016 were partially offset by increases in the regulatory capital restricted cash at ICE Clear Europe and ICE Futures Europe primarily due to additional costs incurred due to the growth of our trading and clearing businesses and additional regulatory capital buffers required by the Bank of England that we classified as restricted cash.

Financing Activities

Consolidated net cash used in financing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 primarily relates to $445 million in net repayments under our commercial paper program, $985 million in net proceeds from the 2022 Senior Notes and 2027 Senior Notes offering, $850 million in repayments of the NYSE Notes, $709$759 million in repurchases of common stock, ~~$358~~$279 million in dividend payments to our ~~shareholders,~~stockholders, and ~~$85~~$76 million in cash payments related to treasury shares received for restricted stock tax payments and stock options ~~exercises.~~ exercises, partially offset by $812 million in net borrowings under our Commercial Paper Program, See “- Debt” below.

Consolidated net cash used in financing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2016~~2017 primarily relates to ~~$1.0 billion~~$469 million in net repayments under our ~~commercial paper program, $307~~Commercial Paper Program, $469 million in repurchases of common stock, $239 million in dividend payments to our ~~shareholders,~~stockholders, and ~~$51~~$81 million in cash payments related to treasury shares received for restricted stock tax payments and stock options exercises. ~~See “- Debt” below.~~

Debt

Our total debt, including short-term and long-term debt, consisted of the following as of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016~~2017 (in millions):


	As of September 30, 2017		As of December 31, 2016		As of June 30, 2018		As of December 31, 2017
Debt:
Short-term debt:
Commercial Paper	$	1,197	$	1,642	$	2,045	$	1,233
NYSE Notes (2.00% senior unsecured notes due October 5, 2017)	—		851
Short-term debt	1,197		2,493
2018 Senior Notes (2.50% senior unsecured notes due October 15, 2018)	599		598		600		600
Total short-term debt					2,645		1,833
Long-term debt:
2020 Senior Notes (2.75% senior unsecured notes due December 1, 2020)	1,243		1,242		1,245		1,244
2022 Senior Notes (2.35% senior unsecured notes due September 15, 2022)	495		—		496		495
2023 Senior Notes (4.00% senior unsecured notes due October 15, 2023)	791		790		792		791
2025 Senior Notes (3.75% senior unsecured notes due December 1, 2025)	1,242		1,241		1,243		1,242
2027 Senior Notes (3.10% senior unsecured notes due September 15, 2027)	495		—		495		495
Long-term debt	4,865		3,871
Total long-term debt					4,271		4,267
Total debt	$	6,062	$	6,364	$	6,916	$	6,100

~~Amended~~ Credit Facility

We ~~had previously entered into~~have a $3.4 billion senior unsecured revolving ~~credit facility, or the~~ Credit Facility ~~which was scheduled to end on November 13, 2020. On August 18, 2017, we agreed~~ with ~~the lenders, amongst other items, to extend the~~a maturity date toof August 18, 2022, ~~herein referred~~pursuant to a credit agreement with Wells Fargo Bank, N.A., as primary administrative agent, issuing lender and swing-line lender, Bank of America, N.A., as syndication agent, backup administrative agent and swing-line lender, and the ~~Amended Credit Facility.~~lenders party thereto. The ~~Amended~~ Credit Facility includes an option for us to propose an increase in the aggregate amount available for borrowing by up to $975 million, subject to the consent of the lenders funding the increase and certain other conditions. ~~The commitments available under the Amended Credit Facility are scheduled to reduce to $3.2 billion on November 13, 2020.~~

Of2018. As of June 30, 2018, of the $3.4 billion that is currently available for borrowing under the ~~Amended~~ Credit Facility, ~~$1.2~~$2.0 billion is required to back-stop the amount outstanding under our Commercial Paper Program ~~as of September 30, 2017.~~ and $105 million is required to support certain broker-dealer subsidiary commitments.

~~Senior Notes~~

On August 17, 2017, we issued $1.0 billion in aggregate senior notes, including $500 million principal amount of 2.35% senior unsecured fixed rate notes due September 2022, or the 2022 Senior Notes, and $500 million principal amount of 3.10% senior unsecured fixed rate notes due September 2027, or the 2027 Senior Notes. We used the majority of the net proceeds from the 2022 Senior Notes and 2027 Senior Notes offering to fund the redemption of the NYSE Notes. The 2022 Senior Notes and 2027 Senior Notes contain affirmative and negative covenants, including, but not limited to, certain redemption rights, limitations on liens and indebtedness and limitations on certain mergers, sales, dispositions and lease-back transactions.

Commercial Paper Program

We have entered into a U.S. dollar ~~commercial paper program, or the~~ Commercial Paper Program. Our Commercial Paper Program is currently backed by the borrowing capacity available under the ~~Amended~~ Credit Facility, equal to the amount of the commercial paper that is issued and outstanding at any given point in time. The effective interest rate of commercial paper issuances does not materially differ from ~~short term~~short-term interest rates (such as USD LIBOR). The fluctuation of these rates due to market conditions may impact our interest expense. During the six months ended June 30, 2018, we used net proceeds of $812 million from notes issued under our Commercial Paper Program primarily to finance the acquisition of BondPoint, to purchase an additional 5.1% stake in Euroclear, and for general corporate purposes.

2018 Senior Notes

We ~~repaid $445~~have $600 million of 2.50% senior unsecured notes due in October 2018 and we currently plan to fund the ~~amounts outstanding~~redemption of these notes with the issuance of new senior term notes. However, if we are unable to issue new senior term notes or to do so on favorable terms, then we would fund the redemption of the notes under the Commercial Paper Program ~~during~~or with the ~~nine months ended September 30, 2017 primarily using net cash proceeds received from~~unused amount available under the ~~sale of our investment in Cetip and~~Credit Facility or cash flows from ~~operations.~~

~~NYSE Notes~~

Committed Contingent Liquidity Facilities

AsTo provide a ~~liquidity~~ tool to ~~support~~address the ~~management~~liquidity needs of ~~initial~~our clearing houses and manage the liquidation of margin and guaranty fund deposits held in the form of cash and high quality sovereign debt, ICE Clear Europe, ICE Clear Credit and ICE Clear USU.S. have entered into Committed Repurchase Agreement Facilities, or Committed Repo. Additionally, ICE Clear Credit has entered into Committed ~~F/X~~FX Facilities to support these liquidity needs. As of ~~September~~June 30, ~~2017,~~2018 the following facilities were in place:

ICE Clear Europe: $1.05 billion in Committed Repo to finance U.S. dollar, euro and pound sterling deposits.


ICE Clear Credit:	$300 million in Committed Repo to finance U.S. dollar and euro deposits, ~~€500~~€250 million in Committed Repo to finance euro deposits, and ~~€1.4~~€1.9 billion in Committed ~~F/X~~FX Facilities to finance euro payment obligations.

ICE Clear ~~US:~~U.S.: $250 million in Committed Repo to finance U.S. dollar deposits.

ICE NGX maintains a guaranty fund utilizing a $100 million letter of credit that has been entered into with a major Canadian chartered bank and backed by a default insurance policy underwritten by EDC, a Canadian government agency. In the event of a participant default, where a participant’s collateral becomes depleted, any remaining shortfall would be covered by a draw down on the letter of credit following which ICE NGX would pay the first $15 million in losses per its deductible and recover additional losses under the insurance policy up to $100 million. Because it is not our policy to guaranty credit facilities of our clearing houses which maintain contingent liquidity facilities secured by high quality liquid assets, during the six months ended June 30, 2018, we eliminated a $100 million guaranty that we had previously provided ICE NGX.

Future Capital Requirements

Our future capital requirements will depend on many factors, including the rate of growth across our ~~trading~~Trading and ~~clearing~~Clearing and ~~data~~Data and ~~listings~~Listings segments, strategic plans and acquisitions, available sources for financing activities, required technology and clearing initiatives, regulatory requirements, the timing and introduction of new products and enhancements to existing products, the geographic mix of our business and potential stock ~~repurchases, and the continuing market acceptance of our electronic trading and clearing platforms.~~repurchases. We currently expect to make aggregate ~~operational~~ capital expenditures (including operational and real estate capital expenditures) and to incur capitalized software development costs ranging between ~~$280~~$300 million and ~~$300~~$330 million for the year ended December 31, ~~2017,~~2018, which we believe will support the enhancement of our technology, business integration and the continued growth of our businesses. ~~In addition,~~

Our Board of Directors has adopted a quarterly dividend declaration policy providing that the declaration of any dividends will be approved quarterly by the Board of Directors or the Audit Committee of the Board of Directors taking into account such factors as our evolving business model, prevailing business conditions and our financial results and capital requirements, without a predetermined annual net income payout ratio. During the second quarter of 2018, we ~~currently expect $50 million in non-operational expenditures during 2017, primarily associated~~paid a quarterly dividend of $0.24 per share of our common stock for an aggregate payout of $139 million. On August 2, 2018, we announced a $0.24 per share dividend for the third quarter of 2018 with ~~leasehold improvements at our New York headquarters.~~the dividend payable on September 28, 2018 to stockholders of record as of September 13, 2018.

As of ~~September~~June 30, ~~2017,~~2018, we had ~~$6.1~~$6.9 billion in outstanding debt. We currently have a $3.4 billion ~~Amended~~ Credit Facility. After factoring in the ~~$1.2~~$2.0 billion required to backstop our Commercial Paper Program and the $105 million required to support certain broker-dealer subsidiary commitments as of ~~September~~June 30, ~~2017, $2.2~~2018, $1.3 billion of our ~~Amended~~ Credit Facility is currently available for general corporate purposes. ~~The Amended~~Other than the facilities discussed above for our clearing houses, the Credit Facility and our Commercial Paper Program are currently the only significant agreements or arrangements that we have with third parties for liquidity and capital resources. In the event of any strategic acquisitions, mergers or investments, or if we are required to raise capital for any reason or desire to return capital to our stockholders, we may incur additional debt, issue additional equity to raise necessary funds, repurchase additional shares of our common stock or pay a dividend. However, we cannot provide assurance that such financing or transactions will be available or successful, or that the terms of such financing or transactions will be favorable to us. As described above, we have $600 million of senior notes due in October 2018 and we currently plan to fund the redemption of these notes in the near term with the issuance of new senior term notes. We also expect to raise sufficient proceeds from the new senior term notes to refinance the majority of our issuances under our Commercial Paper Program that resulted from acquisitions and investments in the last year. See "- Recent Developments," above. However, if we are unable to issue new senior term notes or to do so on favorable terms, then we would fund the redemption of the notes under the Commercial Paper Program or with the unused amount available under the Credit Facility or cash flows from operations, or a combination of these sources. See “- Debt” above.

Non-GAAP Financial Measures

We use non-GAAP measures internally to evaluate our performance and in making financial and operational decisions. When viewed in conjunction with our GAAP results and the accompanying reconciliation, we believe that our presentation of these measures provides investors with greater transparency and a greater understanding of factors affecting our financial condition and results of operations than GAAP measures alone. In addition, we believe the presentation of these measures is useful to investors for period-to-period comparison of results because the items described below as adjustments to GAAP are not reflective of our core business performance. These financial measures are not in accordance with, or an alternative to, GAAP financial measures and may be different from non-GAAP measures used by other companies. We use these adjusted results because we believe they more clearly highlight trends in our business that may not otherwise be apparent when relying solely on GAAP financial measures, since these measures eliminate from our results specific financial items that have less bearing on our core operating performance. We strongly recommend that investors review the GAAP financial measures included in this Quarterly Report, including our consolidated financial statements and the notes thereto.

Adjusted operating expenses, adjusted operating income, adjusted operating margin, adjusted net income attributable to ICE common ~~shareholders~~stockholders and adjusted earnings per share for the periods presented below are calculated by adding or subtracting the adjustments described below, which are not reflective of our cash operations and core business performance, and their related income tax effect and other tax adjustments (in millions, except for percentages and per share amounts):

Trading and Clearing Segment Data and Listings Segment Consolidated
Nine Months Ended
September 30, Nine Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016 2017 2016
Revenues, less transaction-based expenses $ 1,611
$ 1,584
$ 1,874
$ 1,777
$ 3,485
$ 3,361
Operating expenses $ 643
$ 672
$ 1,055
$ 1,080
$ 1,698
$ 1,752
Less: Interactive Data and NYSE transaction and integration costs —
1
23
30
23
31
Less: Amortization of acquisition-related intangibles 41
58
155
172
196
230
Less: Net loss on divestiture of NYSE Governance Services —
—
6
—
6
—
Less: Accruals relating to ongoing investigations and inquiries 14
—
—
—
14
—
Less: Creditex customer relationship intangible asset impairment —
33
—
—
—
33
Less: Employee severance costs related to Creditex U.K. brokerage operations —
4
—
—
—
4
Adjusted operating expenses $ 588
$ 576
$ 871
$ 878
$ 1,459
$ 1,454
Operating income $ 968
$ 912
$ 819
$ 697
$ 1,787
$ 1,609
Adjusted operating income $ 1,023
$ 1,008
$ 1,003
$ 899
$ 2,026
$ 1,907
Operating margin 60 % 58 % 44 % 39 % 51 % 48 %
Adjusted operating margin 63 % 64 % 54 % 51 % 58 % 57 %

Net income attributable to ICE common shareholders $ 1,289
$ 1,070
Add: Interactive Data and NYSE transaction and integration costs 23
31
Add: Amortization of acquisition-related intangibles 196
230
Add: Net loss on divestiture of NYSE Governance Services 6
—
Add: Employee severance costs related to Creditex U.K. brokerage operations —
4
Add: Creditex customer relationship intangible asset impairment —
33
Add: Accruals relating to ongoing investigations and inquiries 14
—
Less: Cetip investment gain (176 ) —
Add: Foreign exchange loss and transaction expenses on sale of Cetip 9
—
Less: Income tax effect for the above items (54 ) (111 )
Add: Deferred tax adjustment on acquisition-related intangibles 12
14
Less: Other tax adjustments —
(34 )
Adjusted net income attributable to ICE common shareholders $ 1,319
$ 1,237

Basic earnings per share attributable to ICE common shareholders $ 2.18
$ 1.80
Diluted earnings per share attributable to ICE common shareholders $ 2.17
$ 1.79

Adjusted basic earnings per share attributable to ICE common shareholders $ 2.23
$ 2.08
Adjusted diluted earnings per share attributable to ICE common shareholders $ 2.22
$ 2.07



	Trading and Clearing Segment						Data and Listings Segment						Consolidated
	Six Months Ended June 30,						Six Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017			2018			2017
Total revenues, less transaction-based expenses	$	1,205		$	1,088		$	1,266		$	1,258		$	2,471		$	2,346
Operating expenses	425			397			741			758			$	1,166		$	1,155
Less: Interactive Data transaction and integration costs	—			—			24			20			24			20
Less: Amortization of acquisition-related intangibles	31			28			106			104			137			132
Less: Impairment of exchange registration intangible assets on closure of ICE Futures Canada and ICE Clear Canada	4			—			—			—			4			—
Less: Impairment on divestiture of NYSE Governance Services	—			—			—			6			—			6
Less: Accruals relating to investigations and inquiries	—			10			—			—			—			10
Less: Employee severance costs related to ICE Futures Canada and ICE Clear Canada operations	4			—			—			—			4			—
Adjusted operating expenses	$	386		$	359		$	611		$	628		$	997		$	987
Operating income	$	780		$	691		$	525		$	500		$	1,305		$	1,191
Adjusted operating income	$	819		$	729		$	655		$	630		$	1,474		$	1,359
Operating margin	65		%	63		%	42		%	40		%	53		%	51		%
Adjusted operating margin	68		%	67		%	52		%	50		%	60		%	58		%

Net income attributable to ICE common stockholders													$	919		$	922
Add: Interactive Data transaction and integration costs													24			20
Add: Adjustment to reduce net gain on Trayport divestiture													1			—
Add: Amortization of acquisition-related intangibles													137			132
Add: Impairment of exchange registration intangible assets on closure of ICE Futures Canada and ICE Clear Canada													4			—
Add: Employee severance costs related to ICE Futures Canada and ICE Clear Canada operations													4			—
Add: Impairment on divestiture of NYSE Governance Services													—			6
Add: Accruals relating to investigations and inquiries													—			10
Less: Cetip investment gain													—			(176		)
Add: Foreign exchange loss and transaction expenses on sale of Cetip													—			9
Less: Income tax effect for the above items													(44		)	(32		)
Add: Deferred tax adjustment on acquisition-related intangibles													5			—
Adjusted net income attributable to ICE common stockholders													$	1,050		$	891

Basic earnings per share attributable to ICE common stockholders													$	1.59		$	1.56
Diluted earnings per share attributable to ICE common stockholders													$	1.58		$	1.55

Adjusted basic earnings per share attributable to ICE common stockholders													$	1.81		$	1.50
Adjusted diluted earnings per share attributable to ICE common stockholders													$	1.80		$	1.49

Trading and Clearing Segment Data and Listings Segment Consolidated
Three Months Ended
September 30, Three Months Ended
September 30, Three Months Ended
September 30,
2017 2016 2017 2016 2017 2016
Revenues, less transaction-based expenses $ 523
$ 483
$ 620
$ 595
$ 1,143
$ 1,078
Operating expenses $ 213
$ 245
$ 334
$ 359
$ 547
$ 604
Less: Interactive Data and NYSE transaction and integration costs —
—
3
7
3
7
Less: Amortization of acquisition-related intangibles 13
20
51
56
64
76
Less: Accruals relating to ongoing investigations and inquiries 4
—
—
—
4
—
Less: Creditex customer relationship intangible asset impairment —
33
—
—
—
33
Less: Employee severance costs related to Creditex U.K. brokerage operations —
4
—
—
—
4
Adjusted operating expenses $ 196
$ 188
$ 280
$ 296
$ 476
$ 484
Operating income $ 310
$ 238
$ 286
$ 236
$ 596
$ 474
Adjusted operating income $ 327
$ 295
$ 340
$ 299
$ 667
$ 594
Operating margin 59 % 49 % 46 % 40 % 52 % 44 %
Adjusted operating margin 62 % 61 % 55 % 50 % 58 % 55 %

Net income attributable to ICE common shareholders $ 369
$ 344
Add: Interactive Data and NYSE transaction and integration costs 3
7
Add: Amortization of acquisition-related intangibles 64
76
Add: Accruals relating to ongoing investigations and inquiries 4
—
Add: Employee severance costs related to Creditex U.K. brokerage operations —
4
Add: Creditex customer relationship intangible asset impairment —
33
Less: Income tax effect for the above items (22 ) (45 )
Add: Deferred tax adjustment on acquisition-related intangibles 12
—
Less: Other tax adjustments —
(34 )
Adjusted net income attributable to ICE common shareholders $ 430
$ 385

Basic earnings per share attributable to ICE common shareholders $ 0.63
$ 0.58
Diluted earnings per share attributable to ICE common shareholders $ 0.62
$ 0.57

Adjusted basic earnings per share attributable to ICE common shareholders $ 0.73
$ 0.65
Adjusted diluted earnings per share attributable to ICE common shareholders $ 0.73
$ 0.64



	Trading and Clearing Segment						Data and Listings Segment						Consolidated
	Three Months Ended June 30,						Three Months Ended June 30,						Three Months Ended June 30,
	2018			2017			2018			2017			2018			2017
Total revenues, less transaction-based expenses	$	609		$	550		$	637		$	630		$	1,246		$	1,180
Operating expenses	218			197			373			374			$	591		$	571
Less: Interactive Data transaction and integration costs	—			—			12			8			12			8
Less: Amortization of acquisition-related intangibles	15			16			53			51			68			67
Less: Impairment of exchange registration intangible assets on closure of ICE Futures Canada and ICE Clear Canada	4			—			—			—			4			—
Less: Impairment on divestiture of NYSE Governance Services	—			—			—			6			—			6
Less: Employee severance costs related to ICE Futures Canada and ICE Clear Canada operations	4			—			—			—			4			—
Adjusted operating expenses	$	195		$	181		$	308		$	309		$	503		$	490
Operating income	$	391		$	353		$	264		$	256		$	655		$	609
Adjusted operating income	$	414		$	369		$	329		$	321		$	743		$	690
Operating margin	64		%	64		%	41		%	41		%	53		%	52		%
Adjusted operating margin	68		%	67		%	52		%	51		%	60		%	58		%

Net income attributable to ICE common stockholders													$	455		$	419
Add: Interactive Data transaction and integration costs													12			8
Add: Amortization of acquisition-related intangibles													68			67
Add: Impairment of exchange registration intangible assets on closure of ICE Futures Canada and ICE Clear Canada													4			—
Add: Employee severance costs related to ICE Futures Canada and ICE Clear Canada operations													4			—
Add: Impairment on divestiture of NYSE Governance Services													—			6
Add: Foreign exchange loss and transaction expenses on sale of Cetip													—			9
Less: Income tax effect for the above items													(23		)	(60		)
Add: Deferred tax adjustment on acquisition-related intangibles													5			—
Adjusted net income attributable to ICE common stockholders													$	525		$	449

Basic earnings per share attributable to ICE common stockholders													$	0.79		$	0.71
Diluted earnings per share attributable to ICE common stockholders													$	0.78		$	0.71

Adjusted basic earnings per share attributable to ICE common stockholders													$	0.91		$	0.76
Adjusted diluted earnings per share attributable to ICE common stockholders													$	0.90		$	0.76

Acquisition-related transaction costs are included as part of our core business expenses, except for those that are directly related to the announcement, closing, financing or termination of a transaction. However, the acquisition-related transaction and integration costs relating to Interactive Data ~~and NYSE~~ are included in non-GAAP adjustments given the ~~sizes~~size of ~~these acquisitions. As of June 30, 2016, the integration of NYSE had been completed and we will no longer include any NYSE integration costs as non-GAAP adjustments following~~ this ~~date.~~acquisition. Amortization of acquisition-related intangibles are included in non-GAAP adjustments as excluding these non-cash expenses provides greater clarity regarding our financial strength and stability of cash operating results.

During the ~~nine~~six months ended ~~September~~June 30, 2018, we include as a non-GAAP adjustment the reduction of the gain on our December 2017 sale of Trayport as it represents a non-recurring item. During the six months ended June 30, 2017, we include as non-GAAP adjustments the Cetip net realized investment gain and during the six months and three months ended June 30, 2017 the foreign exchange loss and transaction expenses on the sale of Cetip, as the sale of Cetip is not part of our core business operations. During the ~~nine and three~~six months ended ~~September~~June 30, 2017, we include as a non-GAAP ~~adjustments~~adjustment the ~~accruals~~accrual relating to ~~ongoing~~ investigations and inquiries as it is a ~~non-recurring~~nonrecurring item. During the ~~nine~~six months and three months ended ~~September~~June 30, 2018, we include as non-GAAP adjustments the impairment loss on exchange registration intangible assets and employee severance costs related to the closure of ICE Futures Canada and ICE Clear Canada as they are non-recurring items. During the six months and three months ended June 30, 2017, we include as a non-GAAP adjustment the NYSE Governance Services net loss on divestiture as it is a non-recurring item. During the nine and three months ended September 30, 2016, we include as non-GAAP adjustments the Creditex U.K. voice brokerage severance costs related to its discontinuance and the related Creditex customer relationship intangible asset impairment expense as it is a non-recurring item.

The income tax effects relating to the items above ~~are included in non-GAAP adjustments~~ as well as deferred tax adjustments on acquisition-related intangibles ~~and other tax adjustments. The tax items~~are included in non-GAAP adjustments are either the tax impacts of the pre-tax non-GAAP adjustments or are tax items as described below that are not in the normal course of business and are not indicative of our core business performance. The non-GAAP income tax effect adjustments above for the nine months ended September 30, 2017 include tax benefits associated with the divestiture of NYSE Governance Services. Deferred tax adjustments on acquisition-related intangibles for the nine months ended September 30, 2017 and 2016 primarily include the impact of U.S.

state tax law and apportionment changes which resulted in deferred tax benefits. Other tax adjustments for the nine and three months ended September 30, 2016 relate to U.K. corporate income tax rate changes.adjustments.

For additional information on these items, refer to our consolidated financial statements and related notes, which are included elsewhere in this Quarterly Report and “- Recent Developments, ”,” “- Consolidated Operating ~~Expenses”,~~Expenses,” “- Consolidated Non-Operating Income (Expense)”~~, “- Consolidated Income Tax Provision”~~ and Part II, Item 1 “- Legal ~~Proceedings”.~~Proceedings.”

Contractual Obligations and Commercial Commitments

In the ~~third~~second quarter of ~~2017,~~2018, there were no significant changes to our contractual obligations and commercial commitments from those disclosed in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our ~~2016~~2017 Form 10-K.

Off-Balance Sheet Arrangements

As described in Note 10 to our consolidated financial statements and related notes, which are included elsewhere in this Quarterly Report, certain clearing house collateral is reported off-balance sheet. We do not have any relationships with unconsolidated entities or financial partnerships, often referred to as structured finance or special purpose ~~entities, which have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.~~entities.

New and Recently Adopted Accounting Pronouncements

Refer to ~~note~~Note 2 to our consolidated financial statements ~~above~~ for information on the new and recently adopted accounting pronouncements that are applicable to us.

Critical Accounting Policies and Estimates

In the ~~third~~second quarter of ~~2017,~~2018, there were no significant changes to our critical accounting policies and estimates from those disclosed in the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our ~~2016~~2017 Form 10-K.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a result of our operating and financing activities, we are exposed to market risks such as interest rate risk, foreign currency exchange rate risk and credit risk. We have implemented policies and procedures designed to measure, manage, monitor and report risk exposures, which are regularly reviewed by the appropriate management and supervisory bodies.

Interest Rate Risk

We have exposure to market risk for changes in interest rates relating to our cash and cash equivalents, short-term investments, short-term and long-term restricted cash and investments, and indebtedness. As of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, our cash and cash equivalents, short-term investments and short-term and long-term restricted cash and ~~investments~~cash equivalents were ~~$1.5~~$1.7 billion and ~~$1.4~~$1.6 billion, respectively, of which ~~$259~~$295 million and ~~$272~~$293 million, respectively, were denominated in pounds sterling, euros or Canadian dollars. The remaining cash and cash equivalents, short-term investments, and short-term and long-term restricted cash and ~~investments~~cash equivalents are denominated in U.S. dollars. We do not use our investment portfolio for trading or other speculative purposes. A hypothetical decrease in long-term interest rates to zero basis points would decrease annual pre-tax earnings by $7$18 million as of ~~September~~June 30, ~~2017,~~2018, assuming no change in the amount or composition of our cash and cash equivalents, short-term investments, and short-term and long-term restricted cash and ~~investments.~~cash equivalents.

As of ~~September~~June 30, ~~2017,~~2018, we had ~~$6.1~~$6.9 billion in outstanding debt, of which $4.9 billion relates to our senior notes, which bear interest at fixed interest rates. The remaining amount outstanding of ~~$1.2~~$2.0 billion relates to ~~our~~the Commercial Paper Program, which bears interest at fluctuating rates and, therefore, subjects us to interest rate risk. A hypothetical 100 basis point increase in long-term interest rates relating to the amounts outstanding under ~~our~~the Commercial Paper Program as of ~~September~~June 30, ~~2017~~2018 would decrease annual pre-tax earnings by ~~$12~~$20 million, assuming no change in the volume or composition of our outstanding indebtedness and no hedging activity. See Item 2 “- Management’s Discussion and Analysis of Financial Condition and Results of Operations - Debt” included elsewhere in this Quarterly Report.

The interest rates on our Commercial Paper Program are currently evaluated based upon current maturities and market conditions. The weighted average interest rate on our Commercial Paper Program increased from ~~0.74%~~1.49% as of December 31, ~~2016~~2017 to ~~1.23%~~2.06% as of ~~September~~June 30, 2018, and increased from 1.16% as of June 30, 2017. The ~~increase~~increases in the Commercial Paper Program weighted average interest ~~rate was~~rates were primarily due to the decisions by the U.S. Federal Reserve in March 2017, ~~and in~~ June 2017, December 2017 and March 2018 to increase the federal funds short-term interest rate by an aggregate 50100 basis points to ~~1.25%~~1.75%. In the six months ended June 30, 2018, the broader commercial paper market also experienced a significant increase in the supply of short-term issuances which drove commercial paper interest rates higher. The ~~Federal Reserve also signaled that they intend to continue to increase the federal fund short-term~~effective interest rate ~~over the next several years, and if this occurs, this~~of commercial paper issuance will continue to ~~increase~~fluctuate based on the ~~weighted average~~movement in short-term interest ~~rate on our~~

~~Commercial Paper Program. See Item 2 “- Management’s Discussion~~rates along with shifts in supply and ~~Analysis of Financial Condition and Results of Operations - Debt” included elsewhere in this Quarterly Report.~~demand within the commercial paper market.

Foreign Currency Exchange Rate Risk

As an international business, we are subject to foreign currency exchange rate risk. We may experience gains or losses from foreign currency transactions in the future given that a significant part of our assets and liabilities are recorded in pounds sterling,

Canadian dollars or euros, and a significant portion of our revenues and expenses are recorded in ~~euros~~pounds sterling or ~~pounds sterling.~~euros. Certain assets, liabilities, revenues and expenses of foreign subsidiaries are denominated in the local functional currency of such subsidiaries. Our exposure to foreign denominated earnings for the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018 is presented by primary foreign currency in the following table (dollars in millions, except exchange rates):

Nine Months Ended
September 30, 2017 Three Months Ended
September 30, 2017
Pound sterling Euro Pound sterling Euro
Average exchange rate to the U.S. dollar in the current year period 1.2760
1.1136
1.3091
1.1752
Average exchange rate to the U.S. dollar in the same period in the prior year 1.3992
1.1167
1.3142
1.1160
Average exchange rate increase (decrease) (9 )% — % — % 5 %
Foreign denominated percentage of:
Revenues, less transaction-based expenses 10 % 4 % 10 % 5 %
Operating expenses 12 % 3 % 12 % 2 %
Operating income 9 % 6 % 9 % 7 %
Impact of the currency fluctuations ⁽¹⁾ on:

Revenues, less transaction-based expenses $ (34 ) $ —
$ —
$ 3
Operating expenses $ (19 ) $ —
$ —
$ 1
Operating income $ (15 ) $ —
$ —
$ 2



	Six Months Ended June 30, 2018						Three Months Ended June 30, 2018						Six Months Ended June 30, 2017						Three Months Ended June 30, 2017
	Pound sterling			Euro			Pound sterling			Euro			Pound sterling			Euro			Pound sterling			Euro
Average exchange rate to the U.S. dollar in the current year period	1.3762			1.2105			1.3606			1.1918			1.2595			1.0829			1.2793			1.1004
Average exchange rate to the U.S. dollar in the same period in the prior year	1.2595			1.0829			1.2793			1.1004			1.4340			1.1166			1.4339			1.1294
Average exchange rate increase (decrease)	9		%	12		%	6		%	8		%	(12		)%	(3		)%	(11		)%	(3		)%
Foreign denominated percentage of:
Revenues, less transaction-based expenses	10		%	5		%	9		%	5		%	10		%	4		%	11		%	4		%
Operating expenses	11		%	2		%	10		%	2		%	12		%	3		%	12		%	2		%
Operating income	8		%	7		%	9		%	7		%	9		%	5		%	10		%	5		%
Impact of the currency fluctuations ⁽¹⁾ on:
Revenues, less transaction-based expenses	$	20		$	12		$	7		$	4		$	(34	)	$	(3	)	$	(15	)	$	(1	)
Operating expenses	$	11		$	3		$	4		$	1		$	(19	)	$	(1	)	$	(8	)	$	—
Operating income	$	9		$	9		$	3		$	3		$	(15	)	$	(2	)	$	(7	)	$	(1	)

⁽¹⁾Represents the impact of currency fluctuation for the ~~nine~~six months and three months ended ~~September~~June 30, 2018 and June 30, 2017 compared to the same periods in the prior year.

We have a significant part of our ~~assets, liabilities,~~ revenues and expenses recorded in pounds sterling or euros. For both the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, 14% ~~and 15%, respectively,~~ of our consolidated revenues, less transaction-based expenses, were denominated in pounds sterling or euros and ~~15% and 14%, respectively,~~13% of our consolidated expenses were denominated in pounds sterling or euros. As the pound sterling or euro exchange rate changes, the U.S. equivalent of revenues and expenses denominated in foreign currencies changes accordingly.

We have foreign currency transaction risk related to the settlement of foreign currency denominated assets, liabilities and payables that occur through our operations, which are received in or paid in pounds sterling, Canadian dollars or euros, due to the increase or decrease in the foreign currency exchange rates between periods. We incurred foreign currency transaction losses of $2$1 million for both the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017, and there was no impact for the nine months ended September 30, 2016. We incurred foreign currency transaction (losses) gains of ($1 million)~~2018, and $1 million for both the six months and three months ended ~~September~~June 30, 2017, ~~and 2016, respectively. The foreign currency transactions gains (losses) were~~ primarily attributable to the fluctuations of the pound sterling and euro relative to the U.S. dollar. A 10% adverse change in the underlying foreign currency exchange rates as of ~~September~~June 30, ~~2017~~2018 would result in a foreign currency transaction loss of $3$4 million, assuming no change in the composition of the foreign currency denominated assets, liabilities and payables and assuming no hedging activity.

We entered into foreign currency hedging transactions during the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017~~2018 as economic hedges to help mitigate a portion of our foreign exchange risk exposure and may enter into additional hedging transactions in the future to help mitigate our foreign exchange risk exposure. Although we may enter into additional hedging transactions in the future to help mitigate our foreign exchange risk exposure, these hedging arrangements may not be effective, particularly in the event of imprecise forecasts of the levels of our non-U.S. denominated assets and liabilities.

We have foreign currency translation risk equal to our net investment in our foreign subsidiaries. The financial statements of these subsidiaries are translated into U.S. dollars using a current rate of exchange, with gains or losses included in the cumulative translation adjustment account, a component of equity. Our exposure to the net investment in foreign currencies is presented by primary foreign currencies in the table below (in millions):


	As of September 30, 2017				As of June 30, 2018
	Position in pounds sterling		Position in euros		Position in pounds sterling		Position in Canadian dollars		Position in euros
Assets	£	1,282	€	151	£	832	C$	1,426	€	153
of which goodwill represents	268		43
of which goodwill and intangible assets represent					645		469		93
Liabilities	130		44		84		972		42
Net currency position	£	1,152	€	107	£	748	C$	454	€	111
Impact on consolidated equity of a 10% decrease in foreign currency exchange rates	$	154	$	13	$	99	$	35	$	13

As of ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, the portion of our equity attributable to accumulated other comprehensive loss from foreign currency translation was ~~$215~~$178 million and ~~$345~~$136 million, respectively. As of ~~September~~June 30, ~~2017,~~2018, we had net exposure of pounds sterling, Canadian dollars and euros of ~~£1.2 billion ($1.5 billion) and €107~~£748 million ($~~126~~988 million), C$454 million ($346 million), and €111 million ($130 million), respectively. Based on these ~~September~~June 30, ~~2017~~2018 net currency positions, a hypothetical 10% decrease of ~~the~~ pound sterling against U.S. dollar would negatively impact our equity by ~~$154~~$99 million, a hypothetical 10% decrease of Canadian dollar against U.S. dollar would negatively impact our equity by $35 million, and a hypothetical 10% decrease of ~~the~~ euro against U.S. dollar would negatively impact our equity by $13 million. For the ~~nine~~six months and three months ended ~~September~~June 30, ~~2017,~~2018, currency exchange rate differences had a ~~positive~~negative impact of ~~$130~~$42 million and ~~$45~~$75 million, respectively, on our consolidated equity, primarily due to the ~~increase~~decrease in the pound sterling/U.S. dollar exchange rate to ~~1.3398~~1.3208 as of ~~September~~June 30, ~~2017~~2018 (from ~~1.2336~~1.3510 as of December 31, ~~2016)~~2017). The future impact on our business relating to the U.K. leaving the European Union and the corresponding regulatory changes are uncertain at this time, including future impacts on currency exchange rates.

Credit Risk

We are exposed to credit risk in our operations in the event of a counterparty default. We limit our exposure to credit risk by rigorously selecting the counterparties with which we make our investments and execute agreements. Credit risk is monitored by using exposure limits depending on ratings assigned by rating agencies as well as the nature and maturity of transactions. Our investment objective is to invest in securities that preserve principal while maximizing yields, without significantly increasing risk. We seek to substantially mitigate credit risk associated with investments by ensuring that these financial assets are placed with governments, well-capitalized financial institutions and other creditworthy counterparties.

An ongoing review is performed to evaluate changes in the status of counterparties. In addition to the intrinsic creditworthiness of counterparties, our policies require diversification of counterparties (banks, financial institutions, bond issuers and funds) so as to avoid a concentration of risk.

Our clearing houses hold material amounts of clearing member cash deposits which are held or invested primarily to provide security of capital while minimizing credit, market and liquidity risks. Refer to ~~note 9~~Note 10 to our consolidated financial statements, which are included elsewhere in this Quarterly Report, for more information on the clearing ~~houses~~houses' cash deposits, which were ~~$52.4~~$55.0 billion as of ~~September~~June 30, ~~2017.~~2018. While we seek to achieve a reasonable rate of return which may generate interest income for our clearing members, we are primarily concerned with preservation of capital and managing the risks associated with these deposits. As the clearing houses may pass on interest revenues (minus costs) to the members, this could include negative or reduced yield due to market conditions. For a summary of the risks associated with this investment activity and how these risks are mitigated, see Part II, Item 7(A) “Quantitative and Qualitative Disclosures About Market Risk” in our ~~2016~~2017 Form 10-K.

Impact of Inflation

We have not been adversely affected by inflation as technological advances and competition have generally caused prices for the hardware and software that we use for our electronic platforms to remain constant or to decline. In the event of inflation, we believe that we will be able to pass on any price increases to our participants, as the prices that we charge are not governed by long-term contracts.

ITEM 4. CONTROLS AND PROCEDURES

(a) Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report, an evaluation was carried out by our management, with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). Based upon that evaluation, our

Chief Executive Officer and Chief Financial Officer concluded that these disclosure controls and procedures were effective as of the end of the period covered by this report.

(b) Changes in Internal Controls over Financial Reporting. There were no changes in our internal controls over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting. As a result, no corrective actions were taken.

PART II. Other Information

ITEM 1. LEGAL PROCEEDINGS

We are subject to legal proceedings, claims and investigations that arise in the ordinary course of our business. These include ~~for example, several ongoing investigations and inquiries from the SEC and other regulators as well as~~ the matters described in Part I, Item 3 “Legal Proceedings” in our ~~2016~~2017 Form ~~10-K.~~10-K and Note 11 to the consolidated financial statements and related notes, which are included elsewhere in this Quarterly Report, and which should be referred to for further discussion. We establish accruals for those matters in circumstances when a loss contingency is considered probable and the related amount is reasonably estimable. Any such accruals may be adjusted as circumstances change. ~~During the nine and three months ended September 30, 2017, we recorded $14 million and $4 million in expense accruals, respectively, relating to ongoing investigations and inquiries.~~ Assessments of losses are inherently subjective and involve unpredictable factors. We do not believe that the resolution of these legal matters will have a material adverse effect on our consolidated financial conditions, results of operations or liquidity. It is possible, however, that future results of operations for any particular quarterly or annual period may be materially and adversely affected by any developments in legal proceedings, claims and investigations.

Further, as previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016, in May 2014, three purported class action lawsuits were filed and later amended in the Southern District by Harold Lanier against the securities exchanges that are participants in each of the three national market system data distribution plans - the Consolidated Tape Association/Consolidated Quotation Plan, the Nasdaq UTP Plan, and the Options Price Reporting Authority, or the Plans, - which are established under the Exchange Act and regulated by the SEC. New York Stock Exchange LLC, NYSE Arca, Inc. and NYSE MKT LLC, which are our subsidiaries, were among the defendants named in one or more of the suits, in which Lanier claimed to sue on behalf of himself and all other similarly situated subscribers to the market data disseminated by the Plans. Lanier’s allegations included that the exchange participants in the Plans breached agreements with subscribers by disseminating market data in a discriminatory manner in that other “preferred” customers allegedly received their data faster than the proposed class. In September 2014, the defendants moved to dismiss the amended complaints, and in April 2015, the court issued an opinion and order granting the motion and dismissing the three lawsuits with prejudice. In September 2016, the Second Circuit entered an order affirming the dismissal of the lawsuits. In November 2016, the Second Circuit denied a petition filed by Lanier, relating only to the lawsuit involving the Options Price Reporting Authority plan, seeking a rehearing by the panel of judges that decided the appeal or, in the alternative, for review by the full Second Circuit. Lanier has not sought review of these matters by the U.S. Supreme Court and we consider this matter closed.

ITEM 1(A). RISK FACTORS

In the ~~third~~second quarter of ~~2017,~~2018, there were no significant new risk factors from those disclosed in Part 1, Item 1A, “Risk Factors” in our ~~2016~~2017 Form 10-K. In addition to the other information set forth in this Quarterly Report, including the ~~regulatory update~~ information in the "- Regulation" section of Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations, you should carefully consider the factors discussed under “Risk Factors” and the regulation discussion under “Business - Regulation” in our ~~2016~~2017 Form 10-K. These risks could materially and adversely affect our business, financial condition and results of operations. The risks and uncertainties in our ~~2016~~2017 Form 10-K are not the only ones facing us. Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also adversely affect our business.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Stock Repurchases

The table below sets forth the information with respect to purchases made by or on behalf of Intercontinental Exchange, Inc. or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the ~~Securities~~ Exchange Act) of our common stock during the three months ended ~~September~~June 30, ~~2017.~~2018.

Period
(2017)

Total number of
shares purchased
Average price
paid per share
Total number of
shares purchased as
part of publicly
announced plans or
programs(1)
Approximate dollar
value of shares that
may yet be
purchased under the
plans or programs
(in millions)(1)
July 1 - July 31 1,146,769 $66.21 9,877,202 $405
August 1 - August 31 1,362,945 $65.32 11,240,147 $316
September 1 - September 30 1,131,815 $66.32 12,371,962 $241
Total 3,641,529 $65.90 12,371,962 $241



Period (2018)	Total number of shares purchased	Average price paid per share	Total number of shares purchased as part of publicly announced plans or programs(1)	Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions)(1)
April 1 - April 30	1,359,778	$72.74	5,464,791	$801
May 1 - May 31	2,164,394	$71.38	7,629,185	$647
June 1 - June 30	2,774,061	$73.97	10,403,246	$441
Total	6,298,233	$72.81	10,403,246	$441


(1)	Refer to Note 78 to our consolidated financial statements and related notes, which are included elsewhere in this Quarterly Report, for details on our stock repurchase plans.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

Not applicable.

ITEM 6. EXHIBITS



Exhibit Number		Description of Document
~~4.1~~	—	Second Supplemental Indenture dated as of August 17, 2017 among Intercontinental Exchange, Inc., as issuer, NYSE Holdings LLC, as guarantor, and Wells Fargo Bank, National Association, as trustee(incorporated by reference to Exhibit 4.1 to Intercontinental Exchange, Inc.’s Current Report on Form 8-K filed with the SEC on August 17, 2017, File No. 001-36198).

~~4.2~~	—	Form of 2.350% Senior Notes due 2022 (included in Exhibit 4.1 and incorporated by reference to Exhibit 4.2 to Intercontinental Exchange, Inc.’s Current Report on Form 8-K filed with the SEC on August 17, 2017, File No. 001-36198).

~~4.3~~	—	Form of 3.100% Senior Notes due 2027 (included in Exhibit 4.1 and incorporated by reference to Exhibit 4.3 to Intercontinental Exchange, Inc.’s Current Report on Form 8-K filed with the SEC on August 17, 2017, File No. 001-36198).

~~4.4~~	—	Form of Guarantee of NYSE Holdings LLC (included in Exhibit 4.1 and incorporated by reference to Exhibit 4.4 to Intercontinental Exchange, Inc.’s Current Report on Form 8-K filed with the SEC on August 17, 2017, File No. 001-36198).

10.1	—	~~The Fourth Amendment to Credit~~Separation Agreement ~~dated as of August 18, 2017 among~~between Intercontinental Exchange ~~Inc. as borrower, NYSE~~ Holdings, LLC as guarantor, the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent, amending that certain Credit Agreement, dated as of April 3, 2014 among Intercontinental Exchange, Inc. and ~~ICE Europe Parent Limited, as borrowers, the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent (as amended by the First Amendment to Credit Agreement,~~Thomas W. Farley dated ~~as of~~ May ~~15, 2015, the Second Amendment to Credit Agreement, dated as of November 9, 2015, and the Third Amendment to Credit Agreement, dated as of November 13, 2015)~~21, 2018 (incorporated by reference to Exhibit 10.1 to Intercontinental Exchange, Inc.’s Current Report on Form 8-K filed with the SEC on ~~August 21, 2017,~~May 22, 2018, File No. 001-36198).

10.2	—	~~The Fifth Amendment to Credit Agreement, dated as of August 18, 2017 among~~ Intercontinental Exchange, Inc. as borrower, NYSE Holdings LLC as guarantor, the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent, amending that certain Credit Agreement, dated as of April 3, 2014 among Intercontinental Exchange, Inc. and ICE Europe Parent Limited, as borrowers, the lenders party thereto and Wells Fargo Bank, National Association, as administrative agent (as amended by the First Amendment to Credit Agreement, dated as of May 15, 2015, the Second Amendment to Credit Agreement, dated as of November 9, 2015, the Third Amendment to Credit Agreement, dated as of November 13, 2015 and the Fourth Amendment to Credit Agreement, dated as of August 18, 2017)2018 Employee Stock Purchase Plan (incorporated by reference to Exhibit ~~10.2~~4.3 to Intercontinental Exchange, Inc.’s ~~Current Report~~Registration Statement on Form ~~8-K~~S-8, filed with the SEC on ~~August~~May 21, ~~2017,~~2018, File No. ~~001-36198)~~333-225065).

31.1	—	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.

31.2	—	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.

32.1	—	Section 1350 Certification of Chief Executive Officer.

32.2	—	Section 1350 Certification of Chief Financial Officer.

101	—	The following materials from Intercontinental Exchange, Inc.’s Quarterly Report on Form 10-Q for the quarter ended ~~September~~June 30, ~~2017,~~2018, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Income, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Equity, Accumulated Other Comprehensive Loss and Redeemable Non-Controlling Interest (v) Consolidated Statements of Cash Flows and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text.*

As provided in Rule 406T of Regulation S-T, this information is “furnished” and not “filed” for purposes of Sections 11 and 12 of the Securities Act of 1933 and Section 18 of the Securities Exchange Act of 1934. Such exhibit will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934 unless Intercontinental Exchange, Inc. specifically incorporates it by reference.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.



	Intercontinental Exchange, Inc. (Registrant)

Date: ~~November~~August 2, ~~2017~~2018	By:	/s/ Scott A. Hill
		Scott A. Hill
		Chief Financial Officer
		(Principal Financial Officer)

5759



Goodwill balance at December 31, 2016	$	12,291
Acquisitions (divestitures), net	1
Foreign currency translation	57
Reclassification to held for sale	(331		)
Other activity, net	(2		)
Goodwill balance at September 30, 2017	$	12,016



	Annual Listings Revenue			Original Listings Revenues			Other Listings Revenues			Data Services and Other Revenues			Total
Deferred revenue balance at December 31, 2016	$	—		$	66		$	83		$	88		$	237
Additions	367			17			49			345			778
Amortization	(276		)	(8		)	(31		)	(324		)	(639		)
Less NYSE Governance Services, IDMS and Trayport (Notes 3 and 10)	—			—			—			(10		)	(10		)
Deferred revenue balance at September 30, 2017	$	91		$	75		$	101		$	99		$	366



	As of September 30, 2017								As of December 31, 2016
	ICE Clear Europe		ICE Clear Credit		ICE Clear US		Other ICE Clearing Houses		ICE Clear Europe		ICE Clear Credit		ICE Clear US		Other ICE Clearing Houses
Original margin:
Government securities at face value	$	24,611	$	4,339	$	9,738	$	24	$	22,961	$	6,013	$	10,542	$	37
Other	—		—		—		—		—		—		—		368
Total	$	24,611	$	4,339	$	9,738	$	24	$	22,961	$	6,013	$	10,542	$	405
Guaranty fund:
Government securities at face value	$	305	$	42	$	160	$	2	$	217	$	178	$	147	$	40



Assets held for sale:
Cash and cash equivalents	$	5
Goodwill	341
Other intangibles, net	220
Other current and non-current assets	29
Total assets held for sale (included in prepaid expenses and other current assets)	$	595

Liabilities held for sale:
Deferred tax liabilities, net	$	39
Other current and non-current liabilities	21
Total liabilities held for sale (included in other current liabilities)	$	60

Accumulated other comprehensive loss from foreign currency translation classified as held for sale in equity	$	74



	As of September 30,
	2017	2016	Change
Open interest — in thousands of contracts:
Brent crude futures and options	4,278	4,410	(3	)%
Other oil futures and options	5,824	5,143	13
Gasoil futures and options	1,065	979	9
Natural gas futures and options	18,918	16,736	13
Power futures and options	2,980	3,682	(19	)
Emissions and other energy futures and options	2,199	2,363	(7	)
Sugar futures and options	1,162	1,526	(24	)
Other agricultural and metals futures and options	2,129	2,356	(10	)
Interest rates futures and options	21,913	14,999	46
Other financial futures and options	5,617	5,645	—
Total	66,085	57,839	14	%



	Nine Months Ended September 30, 2017						Three Months Ended September 30, 2017
	Pound sterling			Euro			Pound sterling			Euro
Average exchange rate to the U.S. dollar in the current year period	1.2760			1.1136			1.3091			1.1752
Average exchange rate to the U.S. dollar in the same period in the prior year	1.3992			1.1167			1.3142			1.1160
Average exchange rate increase (decrease)	(9		)%	—		%	—		%	5		%
Foreign denominated percentage of:
Revenues, less transaction-based expenses	10		%	4		%	10		%	5		%
Operating expenses	12		%	3		%	12		%	2		%
Operating income	9		%	6		%	9		%	7		%
Impact of the currency fluctuations ⁽¹⁾ on:
Revenues, less transaction-based expenses	$	(34	)	$	—		$	—		$	3
Operating expenses	$	(19	)	$	—		$	—		$	1
Operating income	$	(15	)	$	—		$	—		$	2



Period (2017)	Total number of shares purchased	Average price paid per share	Total number of shares purchased as part of publicly announced plans or programs(1)	Approximate dollar value of shares that may yet be purchased under the plans or programs (in millions)(1)
July 1 - July 31	1,146,769	$66.21	9,877,202	$405
August 1 - August 31	1,362,945	$65.32	11,240,147	$316
September 1 - September 30	1,131,815	$66.32	12,371,962	$241
Total	3,641,529	$65.90	12,371,962	$241