TMX Group (TSE:X) executives said the company has started 2026 with momentum across capital formation, markets, and recurring-revenue data and analytics businesses, while positioning the organization to benefit from emerging themes such as artificial intelligence and tokenization.
Speaking with National Bank Financial equity research analyst Jaeme Gloyn, David Arnold, TMX Group’s chief financial officer, and Luc Fortin, president and CEO of TMX Global Markets and Post Trade, provided updates on quarterly trends, the company’s view of AI-related disruption, post-trade modernization, and the performance of its AlphaX US platform.
Early 2026 trends: capital formation, markets, and Global Insights
Arnold also said corporate solutions benefited from “a lot of corporate actions” and “some net interest income pickups.”
Fortin, discussing markets, said derivatives activity was quieter in January amid uncertainty about central bank rate movements. He said that changed as volatility increased, stating, “the markets have just literally exploded,” and that the derivatives business is “doing exceptionally well.” He added that equity volumes were “similar to the levels we were seeing during the pandemic.”
Arnold said the company’s Global Insights segment—described as “primarily the recurring revenue businesses”—also started strongly. He highlighted continued strength at TMX Datalinx, growth in VettaFi’s “assets under index,” and performance at Trayport, TMX’s London-based natural gas and energy trading platform. Arnold said Trayport continues to perform “really above our expectations of high single to double digits.”
AI: executives see opportunity more than disruption
Asked about investor concerns that AI could disrupt market data and analytics, Arnold said TMX sees “more opportunity than risk.” While acknowledging that “small elements could be disintermediated,” he said TMX can “do that to ourselves to do it better, faster, cheaper.”
Arnold repeatedly framed TMX’s competitive positioning around proprietary data and network effects. Using Trayport as an example, he said the platform’s value comes from “bringing together a network of brokers, traders, and exchanges,” calling the resulting data proprietary and arguing that “without the network connectivity, the software is meaningless.” He made a similar point about VettaFi’s index and benchmark operations, saying AI can assist certain functions but that key elements of active work and commercialization are “less AI disruptable.”
Internally, Arnold said AI tools are being used to increase productivity, describing an emphasis on “doing more with the same” and reducing the need to scale headcount, while noting TMX is a significant software developer and is using AI tools in development workflows.
On the question of whether AI increases demand for high-quality data or commoditizes it, Arnold said demand “continues to increase” while pricing models evolve, drawing a parallel to past shifts driven by algorithmic and high-frequency trading. He added that many clients want “raw data” and prefer to generate their own insights—whether using humans or AI—rather than purchasing AI-generated insights from TMX.
Tokenization: payment efficiency and avoiding liquidity fragmentation
Fortin said TMX views tokenization through two lenses. First, he highlighted tokenization’s potential to reduce friction in payments and post-trade processes, particularly for large institutions moving capital and collateral across entities. “Tokenization solves for a lot of these different things,” he said.
Second, he cautioned that some current forms of tokenization risk fragmenting liquidity when tokens are not true replications of the underlying assets. Fortin said that certain tokenized representations of equities trading on digital platforms are “not a true replication of the underlying asset,” and argued that issuer-related considerations—such as corporate actions—need to be reflected.
Fortin said the U.S. is moving toward clearer rules, referencing the SEC’s position that “these tokens are securities” and work by DTCC on alternatives that connect token activity back to the underlying registry. He said Canada should be mindful of U.S. market structure to avoid significant differences, adding that approaches that connect tokens to registries can help prevent liquidity fragmentation.
Fortin said TMX, as the operator of the central registry in Canada through CDS and CDCC, sees “great opportunities,” and that the company is working closely with U.S. partners on potential solutions.
Arnold added that tokenization is not currently showing significant institutional demand in cash equities, but said it could have a role in collateral management, funding, and liquidity. He also discussed uncertainty around how clients might use AI in trading—whether to replace traditional algorithms—and raised risk-management questions about AI-driven strategies, including how firms would implement controls such as “kill switch[es].”
AlphaX US: growth, adoption, and technology “testing ground”
Fortin said AlphaX US, TMX’s entry into the U.S. equity market, is focused on a segment that prioritizes “quality of execution,” which he estimated at about 7% of current average daily volume and projected could grow “beyond 10%.”
He said the platform, launched in early 2025, “exceeded every benchmark that we had set for ourselves,” and described it as a long-term investment rather than a short-term push for maximum share. Fortin cited adoption and engagement with features including the “AlphaX Hub,” and said the business has received technology awards.
Fortin said TMX is using the U.S. market as a “testing ground” for technology built for AlphaX US, with longer-term plans to “port it back” into Canadian markets, including derivatives. He also offered perspective on potential scale, saying that reaching 1% of the 10%+ addressable market would represent “close to 50% of the entire revenue stream of our equity business in Canada.”
Arnold added that during business development trips, some AlphaX US clients began discussing trading in Canada as well, calling it “an unintended byproduct” and “a good outcome.” He said margins would be best compared to Canadian equity markets.
Post-trade modernization and longer-term strategic targets
Fortin said TMX’s post-trade modernization has strengthened the organization’s ability to operate in a changing environment, saying he “could not imagine being in this environment with our old mainframe.” He said TMX is “ahead of the pack” relative to some global peers still modernizing systems, and noted the launch of the Canadian Collateral Management Service (CCMS) alongside the post-trade modernization initiative. Fortin described CCMS as part of the “new plumbing of the Canadian financial markets,” enabled by the modernized infrastructure.
Arnold characterized the post-trade opportunity set as “a lot of singles to be hit,” rather than immediate “home runs,” but said the cumulative effect could be meaningful over time, pointing to collateral management and tokenization-related efforts as areas to watch “in the next few years.”
On TMX’s longer-term objectives—50% of revenue outside Canada, two-thirds recurring revenue, and Global Insights representing half of revenue—Arnold said the goals were designed to balance the business and reduce reliance on Canadian macroeconomic conditions. He said TMX is “around 51% right now” on revenue outside Canada and does not have “aspirations to grow that number much higher,” framing it as a function of growth rates inside and outside Canada.
Arnold said the company’s approach to M&A is rooted in corporate strategy rather than dealmaking for its own sake, describing M&A as one way to accelerate growth alongside building and partnering. Asked about the M&A outlook, he said TMX reviews “a lot of things” across business lines, including capital formation and markets, and pointed to the addition of Newsfile to corporate solutions as an example of expanding into “white space” to support companies. He said investors should “stay tuned” for any updates via press releases and analyst calls.
In closing remarks, Arnold said management is focused on identifying which marketplace shifts are “hype” versus actionable change. Fortin said TMX will continue emphasizing innovation and collaboration across the ecosystem, and noted strong interest in Canada from partners encountered during recent meetings in the U.S., describing an opportunity to “bring Canada to the world and vice versa.”
About TMX Group (TSE:X)
TMX Group Ltd is a company that operates several global markets to provide investment opportunities for its clients. TMX Group’s key operations include Toronto Stock Exchange, TSX Venture Exchange, TSX Alpha Exchange, The Canadian Depository for Securities, Montreal Exchange, Canadian Derivatives Clearing Corporation, and Trayport, which provides listing markets, trading markets, clearing facilities, depository services, technology solutions, data products, and other services to the global financial community.
