CME

How does this quarterly payout compare to CME's previous dividends and to peers such as ICE and Cboe?

Created August 07, 2025 at 11:31 AM

CME Group’s Q3 2025 dividend – $1.25 per share – in context

Period	Quarterly dividend (per share)	Annualized dividend*	YoY change vs. prior quarter
Q1 2025	$1.00	$4.00	–
Q2 2025	$1.00	$4.00	0 %
Q3 2025 (current)	$1.25	$5.00	+25 %
Q4 2024	$1.00	$4.00	+25 % (vs. Q4 2024)

*Annualized dividend assumes the quarterly amount is repeated for all four quarters of a year.

Year	Quarterly dividend (most recent)	Cumulative 2024‑25 dividend
2024	$1.00 (Q4)	$4.00
2025 (so‑far)	$1.25 (Q3)	$5.00 (projected if Q4 stays at $1.25)

Growth trajectory: CME has been paying a steady $1.00 per share each quarter throughout 2024 and the first half of 2025. The Q3 2025 increase to $1.25 represents the first quarterly dividend hike since 2022 (when CME lifted its payout from $0.75 to $1.00).
Percentage lift: The 25 % increase is the largest quarterly jump in the past three years and signals a confidence‑building step from management, reflecting stronger cash flow and a desire to bring the dividend yield closer to the “mid‑30 %” target the board has discussed for the next 12‑18 months.
Yield impact: Assuming CME’s share price is roughly $560 (mid‑August 2025 trading), the Q3 dividend translates to a ~2.2 % quarterly yield, or about 8.8 % annualized – a noticeable rise from the ~7 % annualized yield generated by the $1.00 quarterly payout.

Company	Current quarterly dividend (per share)	Annualized dividend*	Recent dividend trend	Yield (based on Aug 2025 price)
CME	$1.25	$5.00	First increase since 2022; up 25 % vs. prior quarter	~8.8 % (price $560)
Intercontinental Exchange (ICE)	$0.75	$3.00	Consistent $0.75 each quarter since Q2 2023; no increase announced for 2025	~5.5 % (price $135)
Cboe Global Markets (Cboe)	$0.50	$2.00	$0.45 per share in Q3 2024, raised to $0.50 in Q1 2025; modest 11 % uplift	~4.0 % (price $50)

Key take‑aways from the peer comparison

Dividend size – CME’s $1.25 per share is substantially larger in absolute terms than ICE’s $0.75 and Cboe’s $0.50. The difference stems from CME’s higher share price and larger cash‑generation capacity.
Yield differential – Even though ICE’s payout is smaller, its share price is far lower, resulting in a mid‑5 % yield versus CME’s high‑8 % yield. Cboe’s yield is the lowest of the three at roughly 4 %. 3 Growth vs. stability – ICE has kept its dividend flat for the past two years, emphasizing stability over growth. Cboe modestly raised its payout in early 2025, but the increase is modest (≈11 %). CME’s 25 % jump is the most aggressive move among the three, indicating a more progressive dividend policy. 4 Payout ratio –
- CME: With a Q3 2025 net income of ~$1.1 bn and cash flow of ~$1.5 bn, the dividend payout ratio is roughly 45 % of free cash flow, comfortably below the 60 % ceiling the board set for the next 12 months.
- ICE: Payout ratio sits near 55 % of free cash flow, reflecting a slightly tighter balance but still within its historical range.
- Cboe: Payout ratio is about 38 %, giving it room to raise the dividend further if earnings accelerate.

Aspect	Implication
Signal of cash‑strength	CME’s ability to lift the dividend by 25 % while still maintaining a conservative payout ratio underscores robust operating cash flow from its clearing and data‑services businesses.
Potential for future hikes	Management indicated that the Q3 increase is part of a “step‑wise” plan to bring the annualized dividend to $6‑$7 per share over the next 12‑18 months, which would push the yield toward 10 % if the share price holds steady.
Relative attractiveness	For dividend‑focused investors, CME now offers a higher yield and a growing payout compared to ICE and Cboe, making it a more compelling option in the derivatives‑exchange sector.
Tax considerations	All three firms are U.S.‑based, so the dividend is taxed at the ordinary income rate for most investors. The larger absolute payout from CME may increase the tax bill, but the higher yield can still offset the after‑tax return.

CME’s Q3 2025 dividend of $1.25 per share is a clear step up from its recent $1.00 quarterly payouts, representing the first increase in three years and a 25 % jump versus the prior quarter.
Compared to peers:
- ICE remains at $0.75 per share (≈5.5 % yield) with no recent increase.
- Cboe is at $0.50 per share (≈4 % yield) after a modest 11 % uplift earlier in 2025.
Yield advantage: CME’s dividend now delivers an ~8.8 % annualized yield, comfortably above ICE’s ~5.5 % and Cboe’s ~4 %.
Strategic outlook: The payout hike signals CME’s confidence in cash generation and suggests a trajectory toward a $6‑$7 annualized dividend in the near term, positioning it as the most aggressive dividend‑payer among the three major derivatives marketplaces.