London Stock Exchange owner’s growth meets estimates as it leans into Microsoft data deal

The London Stock Exchange Group (LSEG) has reported first-quarter growth in line with analysts’ estimates as it plans to start releasing products from its tie-up with Microsoft in the coming months.

The group, which owns the capital’s flagship stock exchange, said in a trading update on Thursday that its total income, excluding recoveries, came in at £2.09bn in the first three months of 2024. Meanwhile, it posted a gross profit of £1.89bn.

Revenue from LSEG’s data and analytics business, its biggest arm, ticked up one per cent to £999m during the quarter. Meanwhile, rates trading boosted income from its capital markets division by 11 per cent to £439m.

Chief executive David Schwimmer said: “We have started the year well, delivering another quarter of solid growth consistent with our plans. We drove the strongest performances in FTSE Russell, Risk Intelligence and Tradeweb, and our Equities business returned to growth. The rapid pace of innovation continues, with new product launches across LSEG throughout 2024.”

He added that LSEG continued “to make strong progress in our Microsoft partnership, with a number of products expected to be in external pilot or general release this half”.

Microsoft bought a four per cent stake in LSEG in 2022 and has a seat on its board. The US tech behemoth entered into a strategic partnership with LSEG last summer to develop new generative AI models.

“We are now picking up the pace of migrating our datasets onto the Microsoft platform, which will transform access to our data for customers. We look forward to further progress in the rest of the year,” Schwimmer said.

The firm has enjoyed bumper growth since Schwimmer took charge in 2018, transforming into a data and analytics giant with some 25,000 staff and operations in more than 60 countries. Its share price has more than doubled since Schwimmer joined.

However, fears have grown over its flagship exchange, which saw just 23 new firms list last year – a 49 per cent slide from the 45 registered in an already quiet 2022. A number of big names have already snubbed the LSE this year, including travel giant Tui and gambling group Flutter.

Thursday’s update comes ahead of LSEG’s annual meeting later this morning, where it is facing a potential shareholder revolt over Schwimmer’s pay after a key proxy adviser opposed plans to double his remuneration.