BGC Bets on Prediction Markets and Compute Capacity as FMX Hits Critical Mass

Record revenue, a Fanatics partnership, and a compute brokerage launch signal a company monetizing its platform assets in new directions.

BGC · Earnings Call · 2026-07-30

A Record Quarter, Two New Bets

BGC Group reported a second-quarter record, with revenues of $845.5 million, up 7.8% year-over-year, and first-half revenues of $1.8 billion—its highest ever through two quarters. The growth was broad-based, but the most striking developments were two new strategic bets: a Prediction markets partnership with Fanatics and the launch of BGC compute infrastructure markets. These moves take BGC well beyond its traditional voice-brokerage role and into new monetizable asset classes. The Fanatics deal, announced earlier in the week, pairs BGC's institutional client network with Fanatics' database of over 100 million customers. As John Abularrage explained, the logic is simple:

Since I have come into this industry that has been a relative criticism where we have no reach into retail. So we have solved that problem by partnering with Fanatics.
John Joseph Abularrage, Co-Chief Executive Officer · 2026-07-30

The partnership also grants BGC a license to the exchange's data, enabling it to sell predictive data—a shift from its backward-looking datasets. This is a company-unique strategic pivot, not sector boilerplate, and it opens an entirely new revenue stream. Similarly, the compute infrastructure markets business, launched in June, targets the secondary market for compute and memory capacity. John noted, "we are number 1 in ECS. I think it is a natural extension of our power markets," and the company is positioning itself to hedge risk in a market where CapEx is approaching $1 trillion. This is a nascent OTC market with no established standard yet—BGC wants to be the broker that creates it.

FMX: From Counter to Contender

Beyond the new ventures, the core FMX exchange continues to gain traction. U.S. Treasury cash market share hit a record 42%, and the futures exchange posted a 16-fold volume increase year-over-year, with open interest rising from ~22k to over 140k contracts. The execution angle is clear: BGC is listing the remaining tenors on August 3, 2026, which should drive further usage. As Sean Windeatt said in the prepared remarks, "we have grown our revenues double digits every year since" 2022, and the margin trajectory is accelerating. The incremental margin this quarter was 31.3%, and the Q3 guidance implies a step-up. Sean elaborated: “the gearing is in place... well in excess of 30%" and "our electronic platforms and our FMX business will, of course, once up to full speed, dwarf the margins of our existing business.” — Sean A. Windeatt, Co-Chief Executive Officer · 2026-07-30 This margin upside is a key reason BGC's stock has recovered nearly 10% over the last 90 days, though it remains 6% off its June high. BGC's total revenue has more than doubled since 2020 lows, hitting $955M in Q1 2026 (the latest fundamentals period), with operating income recovering to $115M. The FMX UST share gains and the ramp in futures are the tangible proof points that the exchange strategy is working. As Jean-Pierre Aubin noted on the prior call, "everything we say we will do in year 1, we have done," and now the road map points to full competition with CME in year three.

The Margin Story

The market's focus on BGC has shifted from growth to margin expansion. The company's adjusted EBITDA grew 7.2% to $228.7 million, and pretax adjusted earnings were up 11.1%. The cost reduction program, expanded to $35 million, is driving operating leverage. The net effect is visible in “adjusted earnings tax rate to be between 11% and 14% for the full year,” — Sean A. Windeatt, Co-Chief Executive Officer · 2026-07-30 and in the Q3 guidance calling for 17% earnings growth at the midpoint. This margin inflection is not just a one-quarter story. Sean's comment—“what you are seeing is the gearing that we have always spoken about” — Sean A. Windeatt, Co-Chief Executive Officer · 2026-07-30—underscores a structural change in the business mix, as higher-margin electronic and new-asset-class revenues start to scale. The company also received credit rating upgrades from Kroll and JCRA to BBB+ and A-, respectively, reflecting the strength of its cash flows and balance sheet discipline, even as effective net cash remains negative (net debt of ~$996M).

Why It Matters

BGC is no longer just a brokerage; it is becoming a platform company with multiple revenue engines. The Fanatics partnership and compute markets are early-stage, but they signal a willingness to pivot and monetize underutilized assets (like the DCO and the power franchise). Meanwhile, FMX is approaching the point where it can shift from cash burn to meaningful profit contribution. For investors, these are optionalities that, if realized, could re-rate the stock above its current 0.3x price-to-revenue multiple. As John put it on the call: “we are incredibly excited about this partnership and... we will do our very best to deliver shareholder value as we always do.” — John Joseph Abularrage, Co-Chief Executive Officer · 2026-07-30 The market will be watching October 13's FMX Investor Day for more concrete numbers, but the direction is unmistakable.