ICE shares fall 23% on AI fears despite record revenue
Intercontinental Exchange shares have lost nearly a quarter of their value over the past year as investors fret over artificial intelligence disruption, even as the exchange operator posts double-digit earnings growth and record revenue.
Intercontinental Exchange (ICE) closed at $137.67 on July 13, marking a 23.43% decline over the past 52 weeks and valuing the company at $77.85 billion. The selloff accelerated in the second quarter, making the financial exchange operator the top detractor in the Harris Oakmark Select Fund. The fund returned 9.39% for the quarter, significantly trailing the 15.20% gain posted by the S&P 500.
The recent share price weakness stems directly from market anxieties surrounding artificial intelligence disruption and emerging competitive threats. Specifically, investors have penalized ICE over potential competition from new exchanges launching perpetual futures. This negative sentiment aligns with a broader second-quarter trend where market participants narrowly favored companies perceived as direct beneficiaries of AI spending, while information technology and energy sectors acted as drags on broader portfolios.
However, Oakmark argued that the market is mispricing the operational reality of the exchange giant. "We do not view either of these developments as credible threats to ICE's business, which benefits from strong network effects," the fund stated in its second-quarter investor letter. The firm's focus on undervalued businesses over popular market themes led it to characterize ICE as a "durable business with a long runway for growth."
The company's underlying financial metrics appear to support this contrarian stance. During the first quarter of 2026, ICE generated record net revenues of $3 billion, representing an 18% year-over-year increase. Furthermore, Oakmark noted that ICE is expanding earnings per share at a double-digit clip and continues to return the vast majority of its free cash flow to shareholders.
Despite these fundamentals, institutional positioning suggests the stock has not yet won back broad conviction. Hedge fund holdings ticked up only marginally, with 86 portfolios holding ICE at the end of the first quarter, up from 83 in the prior quarter. This leaves the exchange operator well outside the top 40 most popular hedge fund stocks. For market professionals, ICE represents a clear friction point between structural value drivers and a market narrative currently dominated by AI displacement fears.
