Sports Bets Don’t Interest Intercontinental Exchange. It Prefers AI and Blockchain.

Investors’ use of Polymarket for its predictions of storms or corporate actions, rather than its sports activities, is what interested Intercontinental Exchange, ICE CEO Jeff Sprecher said. (Dreamstime)

There wasn’t a mention of sports betting in Thursday’s earnings release from Intercontinental Exchange, the New York Stock Exchange parent commonly known as ICE, even though the convergence of financial markets and sports bookmaking is the talk of every Wall Street cocktail party.

Talk of prediction markets for football and other sports filled last week’s earnings call at rival exchange operator CME Group. Just this month, ICE agreed to invest up to $2 billion into Polymarket, a leading operator of prediction markets that is preparing to list a range of event contracts that will let people bet on “Yes”/”No” propositions in sports.

Exchange-listed sports speculation has grown so fast that state and Native American gambling regulators are asking courts to intervene.

So halfway through this morning’s question session, an analyst asked ICE CEO Jeff Sprecher if the firm was interested in Polymarket’s sports event contracts.

“We were attracted by their nonsports activities,” answered Sprecher. “Sport was not something that really got our interest.”

ICE’s institutional investment customers monitor Polymarket for its predictions of storms or corporate actions, said Sprecher. If Polymarket prospers with sporting event contracts, that would benefit ICE’s investment in the prediction market operator, said Sprecher, but “sports are not high on our list.”

Sprecher and his colleagues are more enthusiastic about artificial intelligence and blockchain technology. AI is helping boost the productivity of ICE’s people, while blockchain can speed transactions and free up customers’ collateral. That, in turn, could increase trading volumes.

It was an earnings call, after all, and ICE’s September quarter results were good. Revenue grew 2% overall, to a record $2.41 billion. Setting aside one-time transactions, recurring revenue rose 5%. Futures and equity exchange revenue rose 1%—with recurring revenue growth of 7%—while fixed-income services rose 5%. Mortgage technology revenue was up 4%. Trading volumes in energy and interest rate derivatives are up, while agricultural futures volumes are down.

Net income jumped 24%, to $816 million. ICE has been buying back stock, so earnings per share jumped 25%, to $1.42.

Not counting noncash charges, per-share earnings were $1.71, or about 10% higher than the year-earlier adjusted earnings. So far this year, ICE has returned $1.7 billion to shareholders through dividends and share buybacks.

By midday Thursday, ICE stock was down 0.1%, at $150.46, while the S&P 500 was 0.4% lower.

Write to Bill Alpert at william.alpert@barrons.com