Revenue Up But Earnings Softer Might Change The Case For Investing In ASX (ASX:ASX)
- ASX Limited reported full-year 2026 results showing revenue rising to A$1,262.1 million from A$1,117.0 million, while net income eased to A$484.9 million from A$502.6 million and basic earnings per share from continuing operations slipped to A$2.493 from A$2.591.
- Despite record volumes and revenue growth across all four business segments, higher expenses tied to the ASIC inquiry, a A$150 million capital charge and a credit rating downgrade weighed on overall profitability.
- We’ll now explore how strong revenue growth but softer earnings, amid higher regulatory and capital costs, affects ASX’s broader investment narrative.
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ASX Investment Narrative Recap
To own ASX, you need to believe its position at the core of Australia’s markets can translate strong volumes into resilient earnings, even as regulation and technology costs rise. The FY26 result, with revenue up but net profit softer, reinforces the key near term catalyst of ongoing technology and data driven growth, while also underlining the biggest current risk: rising regulatory, capital and compliance costs. Overall, this news modestly reinforces existing concerns rather than changing the story.
The recent CHESS Release 1 go live in April 2026 is especially relevant here, given the ASIC inquiry costs and capital charge that affected FY26 earnings. Clearing services are now live on the new platform, with settlement and sub register services targeted for delivery by 2029. This progress speaks directly to ASX’s core catalyst of technology modernisation supporting capacity and reliability, but also ties into project execution risk and the higher expense base highlighted in the latest results.
But behind those higher costs sits a bigger issue investors should be aware of around ASX’s ASIC inquiry and the potential for...
Read the full narrative on ASX (it's free!)
ASX's narrative projects A$1.4 billion revenue and A$508.0 million earnings by 2029.
Uncover how ASX's forecasts yield a A$55.59 fair value, a 8% downside to its current price.
Exploring Other Perspectives
Before this result, the most optimistic analysts were assuming revenue of about A$1.4 billion and earnings near A$521 million by 2029, which is far more upbeat than the baseline view and leans heavily on CHESS and broader tech upgrades paying off. This latest earnings news could prompt both sides of the debate to revisit those assumptions, so it is worth comparing these very different expectations before you decide which story you find more convincing.
Explore 3 other fair value estimates on ASX - why the stock might be worth as much as A$55.59!
The Verdict Is Yours
Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.
- A great starting point for your ASX research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
- Our free ASX research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate ASX's overall financial health at a glance.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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