The Nasdaq Stock Market Inc. reported net income of $7.9 million for the quarter ended September 30, compared with net income of $22 million for the third quarter of 2000, a decrease of 64.1%. (All amounts in U.S. dollars.)

Total revenues for the third quarter were $197.7 million, a 2.5% decrease from $202.7 million for the same period last year. Total expenses for the quarter were $191 million, an increase of 18% from the $161.8 million the prior year.

The largest component of the expense increase was in Compensation and Benefits. This increase was due to a number of factors, including the transfer of positions from the NASD associated with the restructuring and separation of Nasdaq from the NASD, and new positions required to support strategic initiatives. Annualized return on average stockholders’ equity was 6.1% for the third quarter.

Commenting on the results, Nasdaq president Richard Ketchum said, “This has been a year in which we have continued to invest in and build our major strategic initiatives, while managing the business through continued soft market conditions. The third quarter continued this theme and, obviously, also presented additional challenges.”

“We expect the soft market conditions to continue,” Ketchum said. “In the fourth quarter, we are continuing to manage our costs, while at the same time investing in the development efforts for SuperMontageSM and our international initiatives. These actions, and others, continue to strengthen our competitive posture and position us as the venue of choice for investors, companies and market participants,” he concluded.