What does it do?
Miami International is a growth-stage business that earns money by facilitating the buying and selling of financial securities across its eight regulated exchanges. The company operates a "maker-taker" pricing model where it charges fees to the firms that execute trades (the takers) and provides rebates to those that provide liquidity (the makers). Beyond these transaction fees, the company earns high-margin recurring income from "access fees" that brokers pay to connect to its network and "market data fees" for real-time price feeds that traders need to make decisions. Customers stay with MIAX because its proprietary technology offers some of the lowest latency, or processing speed, in the industry, which is critical for high-frequency trading firms.
Where does revenue come from?
The vast majority of revenue comes from transaction and clearing fees in the U.S. options market. Options trading accounts for 88% of net revenue, while the remaining 12% is split between equities, futures, and international listing services. Geographically, the business is primarily rooted in the United States, though the 2025 acquisition of The International Stock Exchange (TISE) has rapidly expanded its presence in European listing markets.
Revenue Breakdown
Who are its customers?
Miami International serves a network of over 430 member firms, including the world's largest market makers, retail broker-dealers, and institutional investors. These include giants like Citadel Securities and Susquehanna, as well as retail-facing brokers like Robinhood, who recently partnered with MIAX on its digital asset strategy. In the second quarter of 2026, these customers traded an average of 11.0 million options contracts per day, representing a 25% increase over the prior year. The company also serves listed companies on its Bermuda and TISE exchanges, where it earns fees for maintaining their public listings.
What gives it staying power?
Staying power comes from the "liquidity moat," where high trading volume attracts even more traders looking for the best prices. This creates a self-reinforcing network effect that is notoriously difficult for new competitors to break once an exchange reaches scale.
Where is it headed?
The company is making a major strategic bet on the futures market with the launch of its Onyx trading platform and new Bloomberg index products. Management is shifting the business from a pure U.S. options player into a global multi-asset class operator to reduce its dependence on any single market. If this works, it will turn MIAX into a direct, full-service rival to the established global exchange oligopolies.
MIAX is experiencing a sharp acceleration in net revenue, which grew 35% to a record $141 million in the most recent quarter. This growth is significantly outpacing the broader exchange industry, driven by a 25% surge in options trading volume and successful fee increases. The company is demonstrating high operating leverage, with its adjusted EBITDA margin expanding from 47% to 54% in a single year as it scales.
Free cash flow is strong and has climbed to $150 million annually, tracking well ahead of reported GAAP net income. This gap exists because the business is capital-light and generates significant non-cash tax benefits and depreciation from its technology investments. The company generated $660 million in cash from its IPO and the sale of a 90% stake in its digital asset exchange, providing a massive war chest for future growth.
The balance sheet is exceptionally clean, with $660 million in cash and virtually no debt. For an exchange operator, this net-cash position is a major competitive advantage, allowing the company to fund acquisitions like TISE and Sapphire without stressing its capital structure. The lack of leverage makes the business highly resilient to the interest rate shifts that often burden its more indebted rivals.
MIAX is a financially robust business that has reached a tipping point where revenue growth is rapidly translating into record profit margins.
MIAX currently pays no dividend and uses its cash to fund platform expansion and new exchange launches. The company is in a heavy growth phase, but it has begun using buybacks to manage its share count following its 2025 IPO. It recently spent cash to repurchase shares, though the overall share count rose significantly last year due to the IPO and secondary offerings. Investors should view this as a growth holding where value is created through business scaling rather than immediate cash returns.
The core options business is firing on all cylinders, reaching a record 11.0 million contracts in daily trading volume. This growth is being driven by both higher overall market volatility and the company's ability to extract more revenue per contract through new market data products.
Regulatory and litigation costs remain the primary drag on the bottom line, highlighted by a recent $30 million settlement. These costs are a natural byproduct of challenging entrenched giants like Nasdaq, and investors must watch whether legal friction slows down the company's aggressive expansion plans.
The global exchange and market infrastructure industry is roughly $150 billion today and is on track to reach $220 billion by 2029 as trading volumes and data demand grow. This is generally a high-quality industry that holds its prices well because of the deep network effects of liquidity, though it faces constant pressure from technological disruption. Miami International is a fast-moving challenger in this space, positioning itself as the high-speed, technology-first alternative to legacy players like Nasdaq and Cboe.
The competitive dynamic in financial exchanges is rationally structured but brutally expensive for newcomers because of the high cost of regulatory compliance and connectivity. Incumbents benefit from massive scale and "sticky" liquidity that is very difficult to move once it is established in a particular exchange.
Cboe and Nasdaq are the primary threats, as they can use their deep pockets to offer fee rebates (liquidity payments) that make it harder for smaller exchanges to gain traction. The most dangerous threat is a coordinated price war from these giants, which could compress MIAX's transaction margins before it reaches the scale needed to sustain them.
MIAX is successfully holding its ground, maintaining a steady 16.5% to 17% share of the U.S. options market despite aggressive competition. The company's consistent market share and rising capture rates prove its technology-driven model is effectively competing with the industry leaders.
The primary source of protection is the network effect of liquidity, where traders congregate on MIAX exchanges because that is where the other buyers and sellers are. This creates a self-reinforcing loop where high trading volumes lead to tighter spreads and better prices, making it even more attractive for new firms to join the network.
The company's record 54% adjusted EBITDA margins and 14.5% return on equity prove that its technology is operating with high efficiency. These numbers collectively show that MIAX has built a real, defensible business that can generate high profits even while it is still in its heavy growth phase.
Exchange technology is ultimately a commodity that larger rivals could replicate with enough capital, and MIAX still lacks the proprietary, "must-have" indices like the VIX that lock customers into its competitors. This keeps the moat narrow for now, as customers could shift their trading volume to other exchanges if MIAX's speed or pricing advantages were to vanish.
The moat is strengthening as the business adds more asset classes. The expansion into futures and international listings makes the entire network more valuable to its members, increasing the total cost and effort it would take for a firm to disconnect from the MIAX ecosystem.
Delivered 35% net revenue growth and record 54% EBITDA margins last quarter.
Sold 90% of MIAXdx for a $50M gain and a key Robinhood partnership.
Founder-CEO with a substantial personal stake and long-term performance-based pay structure.
Capital Allocation Track Record
Thomas Gallagher has proven to be a visionary and disciplined leader who has successfully scaled MIAX from a niche startup into a major threat to the exchange establishment. His strategic decision to sell a majority stake in the company's digital asset arm to Robinhood and Susquehanna was a masterstroke, as it cleared a regulatory hurdle while securing two of the most powerful partners in the trading world. The management team has consistently hit or exceeded its guidance since the IPO, demonstrating a rare ability to balance aggressive geographic expansion with strict cost discipline.
The primary governance risk is the heavy dependence on Gallagher, who as the founder-CEO remains the central architect of the company's strategy and culture. While the company has built a deep bench of experienced executives across its various exchange subsidiaries, his departure would create significant uncertainty regarding the company's M&A and product pipeline. The company also faces the typical dual-class control risks common in founder-led tech firms, though this has yet to result in any decisions that run counter to the interests of minority shareholders.
We expect revenue to grow from $0.5B in FY2026 to $0.8B in FY2031 (~7% CAGR), with EPS growing from $1.70 to $3.25 (~14% CAGR). MIAX is taking business from larger exchanges to reach a roughly seven percent market share by expanding its trading platforms and futures offerings. The company is gaining operating leverage as fixed technology and regulatory costs are spread across a higher volume of trades on its new exchanges. EPS grows faster than revenue because the company is buying back shares while profit margins improve from higher trading volumes. Operating margin expected to reach ~32% by FY2031.
Index futures suite captures significant institutional hedging volume. The launch of Bloomberg-linked futures allows MIAX to compete for high-margin institutional contracts that are currently dominated by a few global giants.
TISE acquisition drives record European and international listing revenue. Expanding the international footprint allows the company to win listings from companies that want a European presence without the costs of legacy exchanges.
Robinhood partnership scales digital asset trading via MIAXdx stake. Leveraging Robinhood's massive retail user base could turn the company's minority stake in MIAXdx into a major source of equity income.
Prolonged low-volatility environment suppresses industry-wide trading volumes. A quiet market reduces the total number of trades, which directly hits the transaction fees that provide most of the company's revenue.
Large incumbents engage in aggressive fee wars to protect share. If Nasdaq or CBOE significantly raise their liquidity rebates, MIAX might be forced to cut its own fees, damaging its profit margins.
Regulatory changes restrict certain high-frequency trading or fee structures. New SEC rules could limit the "maker-taker" model or change how market data is sold, which are core parts of the company's business.
Below is our estimate of current and future fair value, with detailed reasoning and assumptions. Fair value is a judgment, not a fact, and other analysts will likely land on different numbers. Use it as one data point in your research, and apply your own discretion in any investing decision.
We value MIAX by adding up the profit we think it will make over the next six years and then adjusting that total to what it is worth in today’s dollars. This method is the best fit for an exchange operator because it captures the long-term value of its technology platform while recognizing that some of its biggest growth drivers are still in the early stages.
Applying a 20x multiple to the projected 2031 earnings of $3.25 per share gives the company a future value of $65, which works out to $45 today after accounting for the wait. We chose the 20x multiple because it sits right in the middle of established peers like Nasdaq, which trades at 22x, and CBOE, which trades at 18x. The $3.25 earnings figure is what Wall Street analysts expect the company to earn as its newer segments like futures and international listings reach their full potential.
Priced instead on only next year’s earnings at the 20x its rivals trade on, we get $38—about 16% below our $45 fair value. This second calculation uses the FY2027 earnings estimate of $1.89 multiplied by the same 20x multiple we used in our main model. The two numbers are close enough to confirm our results, with the higher main figure simply reflecting the extra value coming from the company's rapid growth beyond 2027. We trust the $45 figure more because it better reflects the company's shift from a simple options exchange to a diversified global platform.
The biggest risk is a sharp and sustained drop in market volatility that dries up trading volume in the core options business. This would directly hit the transaction fees that make up over 87% of revenue, likely compressing the earnings multiple from 20x to 15x and knocking roughly $11 off the per-share fair value. Watch the "Average Daily Volume" metric for any dip below 9 million contracts.
Bear case ($28): Average daily trading volume in multi-list options falls below 9 million contracts for two consecutive quarters; or Futures segment revenue fails to reach 5% of the total revenue mix by the end of 2027.
Bull case ($62): Multi-list options market share climbs above 20% while maintaining double-digit revenue growth; or The company announces a major licensing deal for its Onyx trading technology to a tier-one international partner.
Clearthesis wrote this report from 40 sources, including SEC filings, analyst estimates, industry research, and recent news.
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© 2026 Clearthesis.ai · Report generated on October 7, 2026
This is an AI-generated analysis for informational purposes only and does not constitute financial advice. Data and analysis may not reflect recent developments if viewed significantly after the generation date. Always conduct your own due diligence before making any investment decisions.