The latest war in the Middle East poses “a real test” for the investor resilience that has powered global markets higher over the past several years, David Schwimmer believes, but it is not the only challenge preoccupying the New Yorker who runs the London Stock Exchange Group.
The AI growth story that once propelled stocks upward has been replaced by a focus on the business models the technology will disrupt, “cockroaches” are scuttling in corners of the private credit market, and public debt has reached record levels in major economies. The question of whether resilience is tipping over into complacency is a fair one in those circumstances, Schwimmer cautions.
Huge amounts of liquidity, coupled with the expectation of government intervention should things go wrong, trained investors to “buy the dip,” he observes. But a longer-than-expected war, lasting regional instability, or sustained spikes in oil and gas prices could all push investors to pay more attention to the dangers hanging over markets.
Schwimmer pairs his warning with the confident assertion his own company has an “all-weather” business model; volatile times translate to higher trading volumes and strong demand for data. But he is facing a test of his own: Last month, news broke that Elliott Management had taken a “significant” stake in LSEG. The activist hedge fund did not immediately state its intentions, but it has a reputation for putting public pressure on CEOs who fail to deliver the returns it expects.
Elliott’s arrival on the shareholder register was not entirely surprising. After a strong rally in 2024, LSEG’s shares had sunk to a three-year low. Investors seemed to take fright after Anthropic’s mid-2025 release of Claude for Financial Services, a version of the AI company’s large language model aimed at the bankers, brokers and investors who make up LSEG’s customer base.
Schwimmer, a Yale English graduate and former lawyer, chooses his words carefully when asked about his discussions with Elliott. “We are always open to constructive engagement with our shareholders. Some of our shareholders are more public about how they want to engage,” he says, adding that he learned of Elliott’s investment “shortly before” it became public knowledge.
When Schwimmer announced plans for a £3 billion share buyback plan in late February, Elliott welcomed the news as “a positive first step,” but added that it still saw opportunities for unspecified “further value-enhancing actions.”
Schwimmer says some of his investors have shorter-term horizons than others, but the activist’s stake is not making him chase quick boosts to its share price at the expense of long-term value creation. “We have been active managers of our surplus capital for years,” he says, and the board saw an opportunity to repurchase stock at an attractive price.
Importantly, he adds, LSEG structured the biggest buyback in its history so as not to constrain itself strategically. The company will end up with net debt around two times its earnings before interest, tax, depreciation, and amortization, giving it “healthy strategic flexibility” for other uses of its capital, including deals.
LSEG has been spending about £700 million a year on “bolt-on” transactions, Schwimmer notes. Even as others speculate that LSEG could simplify its portfolio and fund more investor-pleasing buybacks by selling its current 51% stake in the trading platform Tradeweb, Schwimmer says that “if I had the choice, I would own more.” For now, though, he suggests the numbers on such a purchase don’t stack up. “Given the current differential in multiples, it would not be the best use of our capital,” he notes.
The AI mood swing that left LSEG’s shares underperforming the FTSE-100 challenged the core of Schwimmer’s strategy. When the former Goldman Sachs banker joined as CEO in 2018, the London Stock Exchange was the most visible part of the portfolio he inherited. But the exchange, which traces its roots back to 1698, was already a smaller contributor to the group’s revenues than its name suggests, and Schwimmer set out to turn LSEG into a leading global provider of high-value financial information.
The group’s data and analytics business, which he transformed with the £22 billion acquisition of Refinitiv in 2019, now contributes more than 60% of its revenue. Microsoft took a 4% stake in LSEG in December 2022, in a seeming vote of confidence in its data strategy. In recent months, though, the market reversal that also hit the likes of MSCI and S&P Global has left Schwimmer having to persuade investors that powerful AI models will not replace its datasets or the products it sells for analyzing them.
“Frankly, I have some sympathy for investors dealing with the uncertainty of this period,” he says. “The market is trying to wrap its collective mind around a very significant new capability,” and, given the power of AI and the speed at which it is evolving, “it’s our job to make sure that we are communicating as clearly as possible to our shareholders and to the market about what the ramifications are.”
Almost all of LSEG’s data is proprietary, he stresses, and many customers need it delivered in milliseconds or nanoseconds. “That is all about embedded infrastructure and physics,” he says, implying that it will not easily be usurped by a chatbot.
Schwimmer’s not averse to using chatbots: He asked ChatGPT what had happened to the number of professional equity traders over the past 30 years, he says, and it suggested their ranks had thinned by 70% to 90%.
He uses that anecdote to deflate another of the AI bears’ arguments: that AI agents will take the jobs of human traders, cutting demand for LSEG’s data and tools.
“There is a more than decent probability that we and the whole industry see a reduction in the number of humans accessing our industry,” he says, “but look what’s happened to equity trading over the last 30 years. The volumes have gone up dramatically. The requirements for data have gone up dramatically, and messaging traffic has gone up dramatically, with a much smaller number of people.”
Agents may take humans’ places in trading, in other words, but they will be even hungrier for market-moving information. Despite his optimism, Schwimmer knows that an increasingly agentic customer base will require new pricing models, and LSEG has begun migrating customers from its traditional subscription model to one based on live metering of what data they access.
The Refinitiv acquisition and Microsoft deal have been the most visible external expressions of Schwimmer’s strategic repositioning of LSEG, but the cultural shift required internally has been equally significant.
One key change, he says, was the decision to “bring our engineering culture in-house.” In early 2024, LSEG had more third-party contractors than internal engineers. Since then, it has flipped the 60:40 ratio. That improved the company’s engineering capability, Schwimmer says, while improving its cost structure: It was able to hire 800 in-house engineers and developers, and let 2,000 contractors go.
“They were a little bit more expensive on an individual basis,” he says of the people he hired, “but that two-and-a-half to one ratio definitely made it worthwhile.” The improved in-house technical skills have also helped Schwimmer build a faster-moving ethos. “In the past, it might have taken us several months to roll out a new index product. Now we can do that, in some cases, in days,” he notes.
Asked for what this moment requires of his own leadership, Schwimmer says: “We’re executing on a lot… [and] it’s just an environment where there could be plenty of disruption, plenty of distraction.” That makes his task one of keeping his team members focused on executing on the strategy they have set.
How a CEO does that is about “modeling the behavior, and then being really explicit about it,” he says. “I have had people ask me, ‘Is there anything I can do about this, or anything I can do about that?’ And I have said very consistently, ‘We have the right team dealing with this issue. We have the right team dealing with that issue. You can focus on your objectives and [on] delivering for our customers.’ And I think people actually find that very clarifying.”
Meeting those objectives will be critical if Schwimmer is to satisfy Elliott and other investors in an increasingly testing stock market. “The burden is on us” to explain how LSEG plans to benefit from AI, he says, “and then we also have to deliver and demonstrate that through results.”
