HKEX Posts Record Nine-Month Profit Despite Market Volatility

Hong Kong Exchanges and Clearing (HKEX) delivered record nine-month revenue and profit through September 2026, despite a recent moderation in trading activity and a 11% drop in cash market Average Daily Trading (ADT) compared to the same period last year. Profit attributable to shareholders rose 15% year-on-year to HK$15.427 billion, signaling resilience in the face of global macroeconomic uncertainties.

The strong performance was driven by increased trading volumes in derivatives and commodities markets, which offset lower fees from cash market and Southbound trading. Specifically, revenue from the Commodities Market and Northbound Stock Connect increased, alongside higher listing fees. This diversification proved crucial as net investment income from Margin Funds declined due to higher rebates to Clearing Participants. While overall revenue increased by 12% to HK$24.569 billion, the EBITDA margin dipped slightly to 80% – 1 percentage point lower than the same period last year, impacted by rising operating expenses.

Despite the favorable overall results, a closer look reveals some underlying pressures. The 1% year-on-year increase in revenue for the third quarter alone was achieved despite the decrease in ADT, illustrating a reliance on performance in areas beyond core equities trading. Operating expenses increased by 8% in the quarter, driven by higher staff and IT costs. This suggests that HKEX is actively investing in its infrastructure and workforce to support future growth, but these costs are impacting short-term profitability. The company also faces ongoing legal challenges, including a claim related to the 2022 nickel market events, although no provision has been made for potential liabilities, based on the company’s assessment.

HKEX’s results reflect a strategic focus on diversifying its offerings and enhancing its multi-asset ecosystem. The launch of new products, such as the 5-year China Government Bond Futures, and enhancements to market infrastructure, like the Board Lot Framework, demonstrate these efforts. However, the company’s ability to sustain its momentum will depend on navigating evolving market conditions and maintaining robust risk management practices. The increased revenue from Northbound Stock Connect, up 68%, indicates a strong flow of capital into the Chinese market, a trend that needs to continue to support future growth.