By Kimberley Kao
Hong Kong Exchanges & Clearing recorded higher net profit and revenue in the fourth quarter, rounding out another record year for the city's financial markets amid a surge in listings and trading activity.
The results cap a year of significant momentum for Hong Kong, from the "DeepSeek moment" drawing global capital back to the city, helping it reclaim its IPO crown, to its stock market notching its best year since 2017 as the AI boom fueled a tech rally.
The stock-exchange operator on Thursday posted a 15% gain in net profit to 4.335 billion Hong Kong dollars, equivalent to US$554.3 million, for the three months ended December. That beat analysts' expectation for a slight decline to HK$3.76 billion, according to a Visible Alpha consensus.
Revenue and other income climbed 15% to HK$7.31 billion on higher trading and clearing fees across the cash and commodities markets, though lower net investment income from margin funds weighed, the company said.
Trading volumes also strengthened during the period, with the headline average daily turnover rising 23% to HK$229.8 billion.
"In 2025, HKEX reinforced its role as a global superconnector, regained its position as the world's leading venue for IPOs and set new trading as well as financial performance records," Chief Executive Bonnie Y Chan said in a statement.
The city hosted 119 new listings last year that raised HK$286.9 billion, more than triple the funds raised the previous year, with two of them among the world's top five IPOs for the year.
Much of that fervor can be traced back to the so-called DeepSeek moment in early 2025, when the Chinese startup released a large language model seen as a rival to OpenAI's ChatGPT. While DeepSeek disrupted the global AI landscape with its low-cost model, in China, it sparked national pride, spurring a tech stock rally and numerous AI company listings.
Hong Kong's benchmark Hang Seng Index, where many Chinese companies are listed, rose nearly 30% last year, making it one of Asia's best-performing markets. The Hang Seng Tech Index, which tracks the 30 largest technology companies listed in the city, gained about 23%.
The momentum appears to be continuing into 2026, with China's advances in AI, push for technological self-reliance and resilience in global trade buoying investor confidence. The AI frenzy has also driven a new wave of listings, spanning companies involved in large language models, robotics and biotechnology.
HKEX said the IPO pipeline remains robust, with over 400 active applications. The fundraising market has attracted robust participation from Asian, European, Middle Eastern and North American investors, Chan said.
Looking at 2026, volatility is expected to continue due to the macro environment, she said. However, HKEX sees cause for optimism as global investors continue to seek diversification and risk management opportunities in Asian, particularly Chinese, assets.
"Our ongoing strategic development program, which includes investments to modernize our critical infrastructure, will ensure our business continues to remain competitive in this global landscape," Chan said.
Shares in HKEX rose about 0.5% after the results, erasing early declines.
Write to Kimberley Kao at kimberley.kao@wsj.com
(END) Dow Jones Newswires
February 26, 2026 02:51 ET (07:51 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
Comments