LSEG ups guidance, unveils buyback as banks invest £170m in post trade business

(Sharecast News) - Shares in London Stock Exchange Group jumped on Thursday morning after the financial markets platform operator raised its margin guidance, unveiled another £1bn in share buybacks and announced a £170m investment from a consortium of leading banks. The company said that, due to strong momentum in the third quarter with growth across all business lines, EBITDA margins are expected to increase by around 100 basis points in 2025, the top end of its 50-100bp guidance.

Total income rose by 6.4% on an organic, constant-currency basis to £2.22bn in the third quarter, with 4.9% growth in the larger Data & Analytics division to £982m, and 6.3% growth in Markets income to £850m, with all units delivering positive growth despite strong prior-year comparatives. Meanwhile, FTSE Russell income increased 9.3% to £241m, while 13.9% growth was reported in Risk Intelligence income to £144m.

Group gross profits were up 6.5% at £2.02bn.

The company said it advanced its so-called LSEG Everywhere strategy during the period to ramp up the use of innovative tech and industry workflow tools, while deepening its use of Microsoft's AI-powered tool, 365 Copilot.

Separately, LSEG announced a significant transaction in its post trade business, with a group of 11 leading banks buying a 20% stake in Post Trade Solutions for £170m, valuing the whole division at £850m. The banks - which include Bank of America, Barclays, HSBC, BNP Paribas and JPMorgan - are all customers of LSEG's clearing services and Post Trade Solutions, and will benefit from strategic input into the business and its future growth.

The transaction also includes the acquisition by LSEG of an increased proportion of the revenue surplus from the SwapClear business, reducing the proportion entitled to the investing banks from 30% to 15% (applied retroactively from the start of 2025), and to 10% from 2026. LSEG is paying £1.15bn for the change in revenue share rights, with a further £200m due based on certain future growth targets, but said it would be 100bp accretive to EBITDA margins and 2-3% accretive to adjusted earnings per share in 2025.

"This deal strengthens our partnership and strategic alignment with key customers, while delivering attractive margin and earnings enhancement," said chief executive David Schwimmer.

In addition, having returned nearly £1bn to shareholders through share buybacks in the last three months, LSEG committed to a further £1bn by February 2026, taking the total amount of repurchases to £2.5bn over a 12-month period.

The stock was up 5.1% at 9,164p by 0836 BST.