NYSE Euronext Announces Second Quarter 2007 Financial Results

NYSE Euronext (NYSE Euronext: NYX) today reported net income of $161 million, or $0.62 per diluted share, for the three months ended June 30, 2007, a 164% increase as compared to net income of $61 million, or $0.39 per diluted share, for the three months ended June 30, 2006. These results are presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP). Second quarter 2007 GAAP results include the operations of NYSE Group for the full quarter and the results of Euronext N.V. from April 4, 2007, the closing date of the combination between NYSE Group and Euronext N.V. The comparative results for 2006 reflect the operations of NYSE Group only. Included in the results for the three months ended June 30, 2007 are $16 million in merger expenses and exit costs consisting primarily of professional and other fees incurred in connection with both the acquisition of Archipelago Holdings on March 7, 2006 and the combination with Euronext N.V. on April 4, 2007. Giving effect to the combinations as if they had occurred at the beginning of the earliest period presented, but excluding merger expenses, exit costs and other non-recurring items, NYSE Euronext’s net income on a non-GAAP basis for the three months ended June 30, 2007 would have been $172 million, or $0.65 per diluted share, a $39 million or 29% increase as compared to net income of $133 million, or $0.50 per diluted share, for the three months ended June 30, 2006. In addition, on a non-GAAP basis, operating income grew 27% to $275 million for the second quarter of 2007 from $217 million in the year-ago period. A full reconciliation of these non-GAAP results is included in the attached tables. At constant USD/€ exchange rates, excluding acquisitions and divestitures which occurred during the period from June 30, 2006 through June 30, 2007, and on a non-GAAP basis, combined NYSE Euronext revenues, net of activity assessment fees, for the three months ended June 30, 2007 increased 12% while fixed operating expenses (defined as operating expenses, net of Section 31 fees, merger expenses, exit costs, liquidity payments, routing and clearing fees) decreased 9% compared to the three months ended June 30, 2006. "Record revenues in our European cash and derivatives trading, as well as balanced growth in other business lines, including listings and market data, produced a strong second quarter for NYSE Euronext,” said Nelson Chai, Executive Vice President and Chief Financial Officer. "These results underscore NYSE Euronext’s growing product and geographic diversity, as well as increasing user demand for our products and services on a global scale. Our business integration efforts are progressing well, and we remain focused on strategically advancing our global leadership position for the benefit of our customers and shareholders. Moreover, giving effect to foreign currency translations and recent acquisitions, we continue to reduce our fixed expense base through aggressive cost management, which is driving further expansion of our operating margin.” Other Second Quarter Financial and Corporate Highlights On April 4, the shares of NYSE Euronext, the world’s first and largest global exchange group, began trading on NYSE Euronext’s exchanges in New York and Paris. On June 6, NYSE Euronext declared an annual cash dividend of $1.00 per share payable quarterly; the first dividend payment of $0.25 was made on July 13. As of June 30, NYSE Euronext had $1.4 billion of cash, cash equivalents and short-term financial investments (excluding Section 31 fees payable to the SEC), and $3.5 billion of debt. Second Quarter Business Highlights NYSE Euronext’s cash markets, which trade more shares than any other equities marketplace in the world and represent the largest pools of liquidity in their respective markets, realized record trading volumes during the three months ended June 30, 2007. -- NYSE Euronext's European cash markets had their best quarter ever with 74.8 million trades, an increase of 27.7% compared to the three months ended June 30, 2006 and more than double the trading activity for the three months ended June 30, 2005. Through June 30, 2007, 148.7 million trades had been processed by NSC (Euronext's cash trading platform) which represented 1.18 million trades per day on average, the highest figure ever. Year over year, the average daily number of trades increased in every product category: cash equities grew 28.3%, ETFs grew 76.8%, structured products (warrants and certificates) grew 10.8% and bonds grew 2.9%. -- NYSE Euronext's U.S. markets comprised the largest liquidity pool in NYSE-listed cash trading with 63.7% of matched trading volume for the three months ended June 30, 2007. Total daily volume reached a new all-time record with nearly 5.2 billion shares traded on Friday, June 22, 2007, including record Crossing Session II volume of nearly 1.4 billion shares traded. NYSE Euronext's U.S. exchanges also registered new monthly and quarterly record volumes in June 2007 with 60.7 billion shares traded during the month and 166.3 billion shares traded for the three months ended June 30, 2007. -- NYSE Arca continues to be the largest single liquidity pool for ETF trading in the U.S. with 42.3% of handled trading volume for the three months ended June 30, 2007. NYSE Euronext’s derivative markets, Liffe and NYSE Arca Options, continue to demonstrate solid growth in all product areas. -- With 232.6 million contracts traded for the three months ended June 30, 2007, Liffe set a record for trading activity, increasing by 13.7% compared to the same period a year ago. All of Liffe's product categories increased compared to the three months ended June 30, 2006: interest rate contracts grew 5.4%, equity products (single stocks and indices) grew 23.0%, commodities grew 39.5%, and currency grew 13.8%. -- With 116.4 million interest rate contracts traded on Liffe, the three month period ended June 30, 2007 was the second busiest period ever. Year-to-date, interest rate contracts grew by 14% compared to the same period a year ago, establishing a new record with an average of 1.88 million contracts traded per day. -- European equity derivatives have also reached a new record of activity on Liffe with 112.8 million contracts traded for the three months ended June 30, 2007. The six months ended June 30, 2007 were by far the most active period for equity derivative contracts traded on Liffe since its inception. A large part of this growth is attributable to the success of Bclear, Liffe's wholesale clearing service for OTC trades, which processed 43.8 million contracts for the three months ended June 30, 2007, a 71.4% increase compared to the comparable period a year ago. -- In June 2007, NYSE Arca Options submitted its detailed report and recommendations to the SEC for expanding the SEC's successful penny pilot program. With total volume for all contracts in the penny pilot up over 50% year-to-date and average daily volume up 89% year-over-year, NYSE Arca Options has become one of the industry's fastest growing and most efficient options trading platforms. With four new market makers (MMs) added in the quarter, NYSE Arca Options now has 29 MMs as of June 30. More than 3,900 issuers are listed on NYSE Euronext; listed operating companies represent over $30 trillion in total global market capitalization, greater than the next four largest equities marketplaces combined. -- The 70 new listings on NYSE Euronext's U.S. markets for the three months ended June 30, 2007 included 24 IPOs by operating companies. Total IPO proceeds raised by operating companies in connection with listings for the three months ended June 30, 2007 were $12.8 billion, compared to $7.2 billion for the three months ended June 30, 2006. -- For the six months ended June 30, 2007, NYSE Euronext's U.S. markets produced a total of 142 new listings, including 6 transfers from Nasdaq, 3 transfers from the Amex, and 34 IPOs by operating companies, which raised total proceeds of $16.0 billion. For the six months ended June 30, 2007, 27 closed-end fund IPOs raised a total of $23.8 billion in proceeds in connection with their listing on the NYSE. Year-to-date, U.S. domestic IPOs on NYSE Euronext's U.S. markets raised approximately 90% of qualified IPO proceeds, while non-US offerings on NYSE Euronext's U.S. markets represented 100% of qualified proceeds raised. -- For the six months ended June 30, 2007, NYSE Euronext's U.S. markets listed 60 ETFs compared to 36 new ETF listings during the same period a year ago. -- For the three months ended June 30, 2007, Euronext listed 45 new issuers compared with 41 during for the comparable a year ago. Capital raised in connection with listings during the three-month period amounted to EUR 3.3 billion. Of these new listings, NYSE Alternext listed 15 new issues, reaching 100 listed companies as of June 30, 2007. In just over two years, companies listed on NYSE Alternext have raised more than EUR 1 billion and now represent a total market capitalization of over EUR 5 billion. On April 2, 2007, NYSE Euronext announced the launch of high capacity trading services for Cash and Derivatives products trading on NSC and Liffe Connect which consist of new high-speed broadband access to users, as well as a proposed co-location service that will significantly reduce order routing time. NYSE BondsSM, which successfully launched on April 23, 2007 and is based on NYSE Arca’s advanced order-matching technology, provides investors with transparent and highly efficient order executions for nearly 2,500 debt securities of NYSE-listed companies. On April 25, 2007, NYSE TransactTools, which operates a rapidly expanding global network that connects the world’s securities markets and provides super-low latency access to trading and market information, was combined with SIAC’s Sector and SFTI businesses. NYSE TransactTools also launched the new SFTI FIX network connecting over 800 market participants, including all of the NMS markets in the United States. On April 26, 2007, the FINRA/NYSE Trade Reporting Facility (TRF) began processing initial trades and serving customers as a low-cost, reliable competitive alternative for reporting off-exchange transactions. In June 2007, the FINRA/NYSE TRF continued to add customers and increase volume, and currently processes more than 200 million shares daily for all NMS listed securities, including 7% of trading in Nasdaq-listed issues. Elkins/McSherry in its May 2007 Global Trading Cost Analysis reported that the NYSE produced the lowest all-in cost of trading in the world for the fifth consecutive quarter, based on first quarter 2007 data. During the first half of 2007, enhancements to NYSE trading systems and infrastructure reduced order flow latency from around 290 milliseconds (ms) to approximately 110 ms. Leveraging the high-performance TCM messaging server developed by NYSE TransactTools, the new Common Customer Gateway (CCG), scheduled to be implemented in the fourth quarter of 2007, will replace the current Common Message Switch (CMS) for interfacing with NYSE trading systems, including a 2008 expansion connecting the NYSE Arca, NYSE MatchPoint, NYSE BondsSM and NYSE Arca Options trading platforms. To supplement NYSE Euronext's consolidated financial statements prepared in accordance with GAAP and to better reflect period-over-period comparisons, NYSE Euronext uses non-GAAP financial measures of performance, financial position, or cash flows that either exclude or include amounts that are not normally excluded or included in the most directly comparable measure, calculated and presented in accordance with GAAP. Non-GAAP financial measures do not replace and are not superior to the presentation of GAAP financial results, but are provided to (i) present the effects of certain merger expenses and exit costs, and other non-recurring items, and (ii) to improve overall understanding of NYSE Euronext's current financial performance and its prospects for the future. Specifically, NYSE Euronext believes the non-GAAP financial results provide useful information to both management and investors regarding certain additional financial and business trends relating to financial condition and operating results. In addition, management uses these measures for reviewing financial results and evaluating financial performance. The non-GAAP adjustments for all periods presented are based upon information and assumptions available as of the date of this release. About NYSE Euronext NYSE Euronext, a holding company created by the combination of NYSE Group, Inc. and Euronext N.V., commenced trading on April 4, 2007. NYSE Euronext (NYSE Euronext: NYX) operates the world’s largest and most liquid exchange group and offers the most diverse array of financial products and services. NYSE Euronext, which brings together six cash equities exchanges in five countries and six derivatives exchanges in six countries, is a world leader for listings, trading in cash equities, equity and interest rate derivatives, bonds and the distribution of market data. Representing a combined $30.8 trillion/€22.8 trillion total market capitalization of listed companies and average daily trading value of approximately $127.0 billion/€94.0 billion (as of June 29, 2007), NYSE Euronext seeks to provide the highest standards of market quality and integrity, innovative products and services to investors, issuers, and all users of its markets. Cautionary Note Regarding Forward-Looking Statements This press release may contain forward-looking statements, including forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, but are not limited to, statements concerning NYSE Euronext's plans, objectives, expectations and intentions and other statements that are not historical or current facts. Forward-looking statements are based on NYSE Euronext's current expectations and involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied in such forward-looking statements. Factors that could cause NYSE Euronext's results to differ materially from current expectations include, but are not limited to: NYSE Euronext's ability to implement its strategic initiatives, economic, political and market conditions and fluctuations, government and industry regulation, interest rate risk and U.S. and global competition, and other factors detailed in NYSE Euronext’s reference document for 2006 ("document de référence") filed with the French Autorité des Marchés Financiers (Registered on June 6, 2007 under No. R.07-0089), 2006 Annual Report on Form 10-K, as amended, and other periodic reports filed with the U.S. Securities and Exchange Commission or the French Autorité des Marchés Financiers. In addition, these statements are based on a number of assumptions that are subject to change. Accordingly, actual results may be materially higher or lower than those projected. The inclusion of such projections herein should not be regarded as a representation by NYSE Euronext that the projections will prove to be correct. This press release speaks only as of this date. NYSE Euronext disclaims any duty to update the information herein. NYSE Euronext Condensed consolidated statements of income in accordance with GAAP (unaudited) (in millions, except per share data)   Three months ended June 30, Six months ended June 30, 2007 2006 2007 2006   Revenues Activity assessment $ 115 $ 190 $ 301 $ 329 Cash trading 387 187 637 261 Derivatives trading 185 11 197 13 Listing 99 89 189 177 Market data 106 60 169 109 Software and technology services 92 42 117 81 Regulatory 57 45 107 85 Licensing, facility and other   37     36     64     59   Total revenues 1,078 660 1,781 1,114 Section 31 fees (115 ) (190 ) (301 ) (329 ) Merger expenses and exit costs (16 ) (10 ) (27 ) (12 ) Compensation (207 ) (138 ) (313 ) (307 ) Liquidity payments, routing and clearing (218 ) (98 ) (398 ) (123 ) Systems and communications (82 ) (30 ) (109 ) (60 ) Professional services (32 ) (29 ) (53 ) (57 ) Depreciation and amortization (71 ) (36 ) (106 ) (64 ) Occupancy (34 ) (22 ) (55 ) (40 ) Marketing and other (52 ) (29 ) (73 ) (48 ) Regulatory fine income   4     6     9     23   Operating income 255 84 355 97 Net interest and investment income (loss) (23 ) 9 (14 ) 19 Gain on sale of equity investment 2 - 2 21 Income from associates 2 - 3 - Other income   9     8     13     15   Income before income tax provision and minority interest 245 101 359 152 Income tax provision (78 ) (39 ) (124 ) (58 ) Minority interest   (6 )   (1 )   (6 )   (2 ) Net income $ 161   $ 61   $ 229   $ 92     Basic earnings per share $ 0.62 $ 0.39 $ 1.10 $ 0.65 Diluted earnings per share $ 0.62 $ 0.39 $ 1.09 $ 0.64   Basic weighted average shares outstanding 259 156 208 142 [a] Diluted weighted average shares outstanding 260 157 209 143 [a]     [a] Adjusted to reflect the merger with Archipelago on March 7, 2006 giving retroactive effect to the issuance of shares to former NYSE members. NYSE Euronext Condensed combined statements of income including non-GAAP financial measures (unaudited) (in millions, except per share data)   We use non-GAAP financial measures of operating performance. Non-GAAP measures do not replace and are not superior to the presentation of our GAAP financial results but are provided to improve overall understanding of our current financial performance and our prospects for the future.                       Three months ended June 30, [a] Six months ended June 30, [a] 2007 2006 2007 2006 Pro Forma Combined   Pro Forma Combined     Pro Forma Combined   Pro Forma Combined     Revenues Cash trading $ 390 $ 282 $ 758 $ 533 Derivatives trading 190 163 382 314 Listing 99 97 194 190 Market data 108 93 213 186 Software and technology services 94 98 178 192 Regulatory 57 45 107 87 Licensing, facility and other   37     49     74     88   Total revenues 975 827 1,906 1,590 Compensation (210 ) (216 ) [b] (404 ) (438 ) [b] Liquidity payments, routing and clearing (220 ) (118 ) (429 ) (222 ) Systems and communications (84 ) (82 ) (163 ) (172 ) Professional services (33 ) (44 ) (66 ) (90 ) Depreciation and amortization (72 ) [c] (68 ) [c] (143 ) [c] (135 ) [c] Occupancy (35 ) (36 ) (71 ) (70 ) Marketing and other (50 ) (52 ) (92 ) (91 ) Regulatory fine income   4     6     9     23   Operating income 275 217 547 395 Net interest and investment income (loss) (23 ) [d] (23 ) [d] (48 ) [d] (37 ) [d] Income from associates 2 4 [e] 7 9 [e] Other income   9     10     16     18   Income before income tax provision and minority interest 263 208 522 385 Income tax provision (85 ) (70 ) [f] (174 ) (132 ) [f] Minority interest   (6 )   (5 )   (16 )   (12 ) Net income $ 172   $ 133   $ 332   $ 241   Basic earnings per share $ 0.65 $ 0.50 $ 1.26 $ 0.92 Diluted earnings per share $ 0.65 $ 0.50 $ 1.25 $ 0.91   Basic weighted average shares outstanding 265 263 265 262 [g] Diluted weighted average shares outstanding   266         265       266         265   [g]     [a] The results of operations on NYSE Euronext are presented as if the following transactions had been completed at the beginning of the earliest period presented:   1. The acquisition of PCX Holdings and subsidiaries by Archipelago; 2. The disposition of Wave Securities by Archipelago, 3. The merger of Archipelago and NYSE, and 4. The merger of NYSE Group and Euronext.   Merger expenses and exit costs of $99 million and $32 million have been eliminated from the results of operations for the three months ended June 30, 2007 and 2006, respectively, and $119 million and $36 million for the six months ended June 30, 2007 and 2006, respectively, as they represent nonrecurring charges directly attributable to either the merger of the NYSE and Archipelago or the merger of NYSE Group and Euronext N.V. In addition, gains on sale of businesses and equity investments of $2 million and $0 have been eliminated from the results of operations for the three months ended June 30, 2007 and 2006, respectively, and $3 million and $66 million for the six months ended June 30, 2007 and 2006, respectively, as they represent nonrecurring items. Activity assessment fees and Section 31 fees have not been presented as they have no impact on operating income or net income.   [b] One-time compensation charges of $38 million recorded by NYSE Group at the time of the merger with Archipelago and $2 million acceleration of certain Archipelago stock options immediately prior to the merger with NYSE Group were eliminated.   [c] Includes amortization expense of $25 million related to the fair value of the identifiable intangible assets of Euronext for the three months ended June 30, 2007 and 2006, respectively, and $50 million for the six months ended June 30, 2007 and 2006, respectively.   [d] Includes interest expense of $35 million and $28 million on the NYSE Euronext $3.0 billion debt incurred as part of the merger with Euronext for the three months ended June 30, 2007 and 2006, respectively, and $69 million and $55 million for the six months ended June 30, 2007 and 2006, respectively.   [e] Following the fair value adjustment recorded at the Euronext acquisition date, NYSE Euronext no longer accounts for its share in LCH Clearnet's results of operations. As a result, the $4 million and $17 million income from associates related to LCH Clearnet for the three and six months ended June 30, 2006, respectively, has been reversed.   [f] A nonrecurring $11 million tax benefit has been eliminated from both the three and the six months ended June 30, 2006 which corresponded to a change in tax rate on deferred capital gains recorded by Euronext, including gains related to LCH Clearnet.   [g] Adjusted to reflect the merger with Archipelago on March 7, 2006 giving retroactive effect to the issuance of shares to former NYSE members.   NYSE Euronext Condensed combined statements of income including non-GAAP financial measures (unaudited) (in millions, except per share data)   We use non-GAAP financial measures of operating performance. Non-GAAP measures do not replace and are not superior to the presentation of our GAAP financial results but are provided to improve overall understanding of our current financial performance and our prospects for the future.               Three months ended Six months ended June 30, 2007 [a] March 31, 2007 [a] June 30, 2007 [a] Pro Forma Combined   Pro Forma Combined   Pro Forma Combined   Revenues Cash trading $ 390 $ 368 $ 758 Derivatives trading 190 192 382 Listing 99 95 194 Market data 108 105 213 Software and technology services 94 84 178 Regulatory 57 50 107 Licensing, facility and other   37     37     74   Total revenues 975 931 1,906 Compensation (210 ) (194 ) (404 ) Liquidity payments, routing and clearing (220 ) (209 ) (429 ) Systems and communications (84 ) (79 ) (163 ) Professional services (33 ) (33 ) (66 ) Depreciation and amortization (72 ) [b] (71 ) [b] (143 ) Occupancy (35 ) (36 ) (71 ) Marketing and other (50 ) (42 ) (92 ) Regulatory fine income   4     5     9   Operating income 275 272 547 Net interest and investment income (loss) (23 ) [c] (25 ) [c] (48 ) Income from associates 2 5 7 Other income   9     7     16   Income before income tax provision and minority interest 263 259 522 Income tax provision (85 ) (89 ) (174 ) Minority interest   (6 )   (10 )   (16 ) Net income $ 172   $ 160   $ 332     Basic earnings per share $ 0.65 $ 0.61 $ 1.26 Diluted earnings per share $ 0.65 $ 0.60 $ 1.25   Basic weighted average shares outstanding 265 264 265 Diluted weighted average shares outstanding   266         265       266       [a] The results of operations of NYSE Euronext are presented as if the merger with NYSE Group and Euronext had been completed at the beginning of the earliest period presented. Merger expenses and exit costs of $99 million and $20 million for the three months ended June 30, 2007 and March 31, 2007, respectively, have been eliminated as they represent nonrecurring charges attributable to business combinations. In addition, gains on sale of businesses and equity investments of $2 million have been eliminated from the results of operations for the three months ended June 30, 2007 as they represent nonrecurring items. Activity assessment fees and Section 31 fees have not been presented as they have no impact on operating income or net income.   [b] Includes amortization expense of $25 million related to the fair value of the identifiable intangible assets of Euronext for both the three months ended June 30, 2007 and the three months ended March 31, 2007.   [c] Includes interest expense of $35 million and $34 million on the NYSE Euronext $3.0 billion debt incurred as part of the merger with Euronext for the three months ended June 30, 2007 and March 31, 2007, respectively.   NYSE Euronext Condensed combined statements of income including non-GAAP financial measures (unaudited) (in millions, except per share data)   We use non-GAAP financial measures of operating performance. Non-GAAP measures do not replace and are not superior to the presentation of our GAAP financial results but are provided to improve overall understanding of our current financial performance and our prospects for the future.                                       Three months ended Three months ended June 30, 2007 [a] June 30, 2006 [a] US Operations European Operations   Corporate Items   Pro Forma Combined US Operations European Operations   Corporate Items   Pro Forma Combined   Revenues Cash trading $ 268 $ 122 $ - $ 390 $ 187 $ 95 $ - $ 282 Derivatives trading 16 174 - 190 11 152 - 163 Listing 90 9 - 99 89 8 - 97 Market data 58 50 - 108 60 33 - 93 Other revenues   108     80     -     188     123     69     -     192   Total revenues 540 435 - 975 470 357 - 827 Liquidity payments, routing and clearing (192 ) (28 ) - (220 ) (98 ) (20 ) - (118 ) Other operating expenses, net   (237 )   (235 ) [b]   (8 )   (480 )   (271 )   (213 ) [b]   (8 )   (492 ) Operating income 111 172 (8 ) 275 101 124 (8 ) 217 Net interest and investment income (loss) (23 ) [c] (23 ) (23 ) [c] (23 ) Income from associates 2 2 4 4 Other income 9   9   10   10   Income before income tax provision and minority interest 263 208 Income tax provision (85 ) (70 ) Minority interest   (6 )   (5 ) Net income $ 172   $ 133     Basic earnings per share $ 0.65 $ 0.50 Diluted earnings per share $ 0.65 $ 0.50   Basic weighted average shares outstanding 265 263 Diluted weighted average shares outstanding                   266                     265       [a] The results of operations of NYSE Euronext are presented as if the merger with NYSE Group and Euronext had been completed at the beginning of the earliest period presented. Merger expenses and exit costs of $99 million and $32 million for the three months ended June 30, 2007 and June 30, 2006, respectively, have been eliminated as they represent nonrecurring charges attributable to business combinations. In addition, gains on sale of businesses and equity investments of $2 million and $0 million have been eliminated from the results of operations for the three months ended June 30, 2007 and 2006, respectively, as they represent nonrecurring items. Activity assessment fees and Section 31 fees have not been presented as they have no impact on operating income or net income.   [b] Includes amortization expense of $25 million related to the fair value of the identifiable intangible assets of Euronext for both the three months ended June 30, 2007 and the three months ended June 30, 2006.   [c] Includes interest expense of $35 million and $28 million on the NYSE Euronext $3.0 billion debt incurred as part of the merger with Euronext for the three months ended June 30, 2007 and 2006, respectively.   NYSE Euronext Reconciliation of non-GAAP financial measures to GAAP measures (in millions)   We use non-GAAP financial measures of operating performance. Non-GAAP measures do not replace and are not superior to the presentation of our GAAP financial results but are provided to improve overall understanding of our current financial performance and our prospects for the future.   U.S. GAAP Results Euronext [a] Other Pro Forma Adjustments Pro Forma Combined Three months ended June 30, 2007 Revenues $ 1,078 $ 11 $ (115 ) [b] $ 974 Operating expenses   (823 )   (90 )   214   [b],[c]   (699 ) Operating income (loss) 255 (79 ) 99 275 Net interest and investment income (loss) (23 ) - - (23 ) Gain on sale of equity investment 2 - (2 ) - Income from associates 2 - - 2 Other income   9     -     -     9   Income before income tax provision and minority interest 245 (79 ) 97 263 Income tax provision (78 ) 14 (21 ) (85 ) Minority interest   (6 )   1     (1 )   (6 ) Net income $ 161     (64 )   75   $ 172     Three months ended March 31, 2007 Revenues $ 702 $ 414 $ (185 ) [b] $ 931 Operating expenses   (601 )   (238 )   180   [b],[c],[d]   (659 ) Operating income 101 176 (5 ) 272 Net interest and investment income (loss) 9 - (34 ) [e] (25 ) Gain on sale of equity investment - - - - Income from associates - 5 - 5 Other income   4     3     -     7     Income before income tax provision and minority interest 114 184 (39 ) 259 Income tax provision (46 ) (48 ) 5 (89 ) Minority interest   -     (9 )   (1 )   (10 ) Net income $ 68   $ 127   $ (35 ) $ 160     Six months ended June 30, 2007 Revenues $ 1,780 $ 425 $ (300 ) [b] $ 1,905 Operating expenses   (1,424 )   (328 )   394   [b],[c],[d]   (1,358 ) Operating income 356 97 94 547 Net interest and investment income (loss) (14 ) - (34 ) [e] (48 ) Gain on sale of equity investment 2 - (2 ) - Income from associates 2 5 - 7 Other income   13     3     -     16   Income before income tax provision and minority interest 359 105 58 522 Income tax provision (124 ) (34 ) (16 ) (174 ) Minority interest   (6 )   (8 )   (2 )   (16 ) Net income $ 229   $ 63   $ 40   $ 332     [a] Corresponding to the results of operations of Euronext for the period which preceded the merger with NYSE Group.   [b] Includes Activity assessment fees / Section 31 fees.   [c] Includes merger expenses and exit costs.   [d] Includes the amortization expense related to the fair value of the identifiable intangible assets of Euronext.   [e] Includes the interest expense on the NYSE Euronext $3.0 billion debt incurred as part of the merger with Euronext. NYSE Euronext Condensed consolidated statements of financial condition (in millions)   June 30, December 31, 2007 2006 (unaudited)   Assets Current assets: Cash, cash equivalents, investment and other securities $ 1,731 $ 979 Accounts receivable, net 651 335 Deferred income taxes 99 108 Other current assets   342   21 Total current assets 2,823 1,443   Property and equipment, net 596 378 Goodwill 4,824 536 Other intangible assets, net 7,019 584 Investment in associates 729 - Deferred income taxes 383 366 Other assets   557   159 Total assets $ 16,931 $ 3,466   Liabilities and stockholders' equity Accounts payable and accrued expenses $ 1,132 $ 650 Deferred revenue 386 114 Short term debt 3,005 - Deferred income taxes   78   68 Total current liabilities 4,601 832   Accrued employee benefits 351 355 Deferred revenue 312 322 Long term debt 518 - Deferred income taxes 2,306 265 Other liabilities   29   23 Total liabilities 8,117 1,797   Minority interest 182 -   Stockholders' equity 8,632 1,669     Total liabilities and stockholders' equity $ 16,931 $ 3,466 NYSE Euronext Selected Statistical Data: Volume Summary - Cash Products   Average Daily Volume Total Volume Total Volume (Unaudited) Q2 '07 Q2 '06 % Chg Q2 '07 Q2 '06 % Chg YTD 2007 % Chg vs. YTD 2006   Number of Trading Days - European Markets 62 62 - 62 62 - 126 - Number of Trading Days - U.S. Markets 63 63 - 63 63 - 124 -   European Cash Products (trades in thousands) 1,206 945 27.7% 74,798 58,584 27.7% 148,714 27.9%   Equities 1,156 901 28.3% 71,689 55,857 28.3% 142,280 28.2% Exchange-Traded Funds 5 3 76.8% 320 181 76.8% 658 79.3% Structured Products 38 34 10.8% 2,356 2,126 10.8% 4,898 20.1% Bonds 7 7 2.9% 432 420 2.9% 877 -1.2%   U.S. Cash Products (shares in millions)   NYSE Listed Issues 1   NYSE Group Handled Volume 2 2,159 1,969 9.7% 136,002 124,024 9.7% 266,765 11.3% NYSE Group Matched Volume 3 2,011 1,930 4.2% 126,695 121,582 4.2% 250,460 6.5% NYSE Group TRF Volume 4 17 1,060 - 1,060 Total NYSE Listed Consolidated Volume 3,155 2,579 22.3% 198,744 162,452 22.3% 386,579 23.4%   NYSE Group Share of Total Consolidated Volume Handled Volume 2 68.4% 76.3% -7.9% 68.4% 76.3% -7.9% 69.0% -7.5% Matched Volume 3 63.7% 74.8% -11.1% 63.7% 74.8% -11.1% 64.8% -10.3% TRF Volume 4 0.5% 0.5%   NYSE Arca & Amex Listed Issues   NYSE Group Handled Volume 2 174 144 20.8% 10,955 9,069 20.8% 21,196 32.6% NYSE Group Matched Volume 3 149 124 19.6% 9,382 7,843 19.6% 18,279 31.9% NYSE Group TRF Volume 4 10 638 - 638 Total NYSE Arca & Amex Listed Consolidated Volume 475 419 13.4% 29,902 26,366 13.4% 55,772 18.1%   NYSE Group Share of Total Consolidated Volume   Handled Volume 2 36.6% 34.4% 2.2% 36.6% 34.4% 2.2% 38.0% 4.1% Matched Volume 3 31.4% 29.7% 1.7% 31.4% 29.7% 1.7% 32.8% 3.4% TRF Volume 4 2.1% 2.1%   Nasdaq Listed Issues   NYSE Group Handled Volume 2 439 539 -18.7% 27,628 33,974 -18.7% 57,484 -10.2% NYSE Group Matched Volume 3 356 442 -19.4% 22,430 27,844 -19.4% 46,989 -9.8% NYSE Group TRF Volume 4 96 6,078 6,078 Total Nasdaq Listed Consolidated Volume 2,141 2,142 -0.1% 134,889 134,959 -0.1% 268,661 1.1%   NYSE Group Share of Total Consolidated Volume   Handled Volume 2 20.5% 25.2% -4.7% 20.5% 25.2% -4.7% 21.4% -2.7% Matched Volume 3 16.6% 20.6% -4.0% 16.6% 20.6% -4.0% 17.5% -2.1% TRF Volume 4 4.5% 4.5%   Exchange-Traded Funds 1,5   NYSE Group Handled Volume 2 233 194 19.8% 14,682 12,253 19.8% 28,763 31.8% NYSE Group Matched Volume 3 207 176 17.9% 13,057 11,078 17.9% 25,716 31.0% NYSE Group TRF Volume 4 16 1,020 1,020 Total Nasdaq Listed Consolidated Volume 551 454 21.5% 34,736 28,590 21.5% 66,208 29.9%   NYSE Group Share of Total Consolidated Volume   Handled Volume 2 42.3% 42.9% -0.6% 42.3% 42.9% -0.6% 43.4% 0.6% Matched Volume 3 37.6% 38.7% -1.1% 37.6% 38.7% -1.1% 38.8% 0.3% TRF Volume 4 2.9% 2.9%     Please refer to footnotes on the following page. NYSE Euronext Selected Statistical Data: Volume Summary - Derivatives Products   Average Daily Volume Total Volume Total Volume (Unaudited; contracts in thousands) Q2 '07 Q2 '06 % Chg Q2 '07 Q2 '06 % Chg YTD 2007 % Chg vs. YTD 2006   Number of Trading Days - European Markets 62 62 - 62 62 - 126 - Number of Trading Days - U.S. Markets 63 63 - 63 63 - 124 -   European Derivatives Products 3,752 3,300 13.7% 232,641 204,611 13.7% 452,243 16.9%   Total Interest Rate Products 1,878 1,781 5.4% 116,439 110,437 5.4% 238,166 13.5%   Short Term Interest Rate Products 1,759 1,687 4.3% 109,065 104,585 4.3% 223,580 12.8% Medium and Long Term Interest Rate Products 119 94 26.0% 7,374 5,852 26.0% 14,586 25.3%   Total Equity Products 6 1,820 1,480 23.0% 112,820 91,732 23.0% 207,895 20.7%   Total Individual Equity Products 1,244 929 33.9% 77,154 57,607 33.9% 133,944 22.9% Total Equity Index Products 575 550 4.5% 35,666 34,125 4.5% 73,951 16.9%   of which Bclear 707 412 71.4% 43,804 25,553 71.4% 65,450 95.6% Individual Equity Products 629 348 81.0% 39,020 21,553 81.0% 56,009 116.1% Equity Index Products 77 65 19.6% 4,785 4,000 19.6% 9,441 25.1%   Commodity Products 53 38 39.5% 3,269 2,344 39.5% 5,940 28.6%   Currency Products 2 2 13.8% 112 98 13.8% 241 34.9%   U.S. Derivatives Products - Equity Options 7   NYSE Arca Options Contracts 1,115 702 58.9% 70,227 44,205 58.9% 139,725 50.8% Total Consolidated Options Contracts 9,309 7,460 24.8% 586,471 469,983 24.8% 1,137,469 24.1%   NYSE Group Share of Total 12.0% 9.4% 2.6% 12.0% 9.4% 2.6% 12.3% 2.2%     1 Includes all volume executed in NYSE Group crossing sessions. 2 Represents the total number of shares of equity securities and ETFs internally matched on the NYSE Group's exchanges or routed to and executed at an external market center. NYSE Arca routing includes odd-lots. 3 Represents the total number of shares of equity securities and ETFs executed on the NYSE Group's exchanges. 4 Represents NYSE's volume in FINRA/NYSE Trade Reporting Facility (TRF). 5 Data included in previously identified categories. 6 Includes all trading activities for Bclear, Liffe's clearing service for wholesale equity derivatives. 7 Includes trading in U.S. equity options contracts, not equity-index options. Source: NYSE Euronext, Options Clearing Corporation and Consolidated Tape as reported for equity securities. All trading activity is single-counted, except European cash trading which is double counted to include both buys and sells. NYSE Euronext Selected Statistical Data: Other Operating Statistics   Three Months Ended (Unaudited) June 30, 2007 March 31, 2007 June 30, 2006   NYSE Euronext Listed Issuers   NYSE Listed Issuers   NYSE listed issuers1 2,735 2,741 2,697 Number of new issuer listings1 70 72 60 Capital raised in connection with new listings ($mm)2 $12,835 $3,188 $7,244   Euronext Listed Issuers   Euronext listed issuers1 1,197 1,199 1,224 Number of new issuer listings3 45 25 41 Capital raised in connection with new listings ($mm)2 $3,325 $575 $8,160   NYSE Euronext Market Data4   NYSE Market Data   Share of Tape A revenues (%) 69.5% 77.2% 86.1% Share of Tape B revenues (%) 32.2% 38.7% 33.7% Share of Tape C revenues (%) 23.7% 22.0% 24.2% Professional subscribers (Tape A) 434,100 430,136 417,329   Euronext Market Data   Number of terminals 211,573 208,166 202,074     NYSE Euronext Operating Expenses   NYSE Euronext employee headcount5   NYSE Euronext headcount excluding GL Trade 3,643 3,710 4,082 GL Trade headcount 1,323 1,297 1,081     NYSE Euronext Financial Statistics   NYSE Euronext foreign exchange rate (€/US$)   Average €/US$ exchange rate for the quarter $1.348 $1.310 $1.256     1 Figures for NYSE listed issuers include listed operating companies, closed-end funds, and ETFs, and do not include NYSE Arca, Inc. or structured products listed on the NYSE. There were 33 ETFs and 12 operating companies exclusively listed on NYSE Arca, Inc. as of June 30, 2007. There were 512 structured products listed on the NYSE as of June 30, 2007. Figures for Euronext present the operating companies listed on Eurolist, Alternext, and Free Market, and do not include closed-end funds, ETFs and structured product (warrants and certificates). At the end of June 2007, 100 companies were listed on Alternext and 203 ETFs were listed on NextTrack.   2 Euronext figures show capital raised in millions of euros by operating companies listed on Eurolist, Alternext and Free Market and do not include close-end funds, ETFs and structured products (warrants and certificates). NYSE figures show capital raised in millions of USD by operating companies listed on NYSE and Arca exchanges and do not include closed-end funds, ETFs and structured products.   3 Euronext figures include operating companies listed on Eurolist, Alternext and Free Market and do not include closed-end funds, ETFs and structured products (warrants and certificates).   4 "Tape A" represents NYSE listed securities, "Tape B" represents NYSE Arca and Amex listed securities, and "Tape C" represents Nasdaq listed securities. Per the SEC's Regulation NMS, as of April 1, 2007, share of revenues is derived through a formula based on 25% share of trading, 25% share of value traded, and 50% share of quoting, as reported to the consolidated tape. Prior to April 1, 2007, share of revenues for Tapes A and B was derived based on share of trades reported to the consolidated tape, and share of revenue for Tape C was derived based on an average of share of trades and share of volume reported to the consolidated tape. The consolidated tape refers to the collection of market data that multiple markets make available on a consolidated basis.   5 NYSE Euronext owns approximately 40% of the common equity of GL Trade, which is listed separately on Eurolist by Euronext in Paris. NYSE Euronext consolidates the results of GL Trade. NYSE Euronext headcount includes approximately 427 employees that, effective July 30, 2007, were transferred to Financial Industry Regulatory Authority (FINRA) and are no longer employees of NYSE Euronext. NYSE Euronext headcount excludes employees of MTS.   Source: NYSE Euronext