Using those computations as adjusted pro forma operating income, the unit made $203 million in the first quarter, up from $177 million three months prior and $185 million a year ago.

The year-over-year improvement was largely driven by the servicing business, Warren Gardiner, Intercontinental Exchange's chief financial officer said on the earnings call.

"While we benefited from $2 million of one-time revenue that we do not anticipate will repeat, growth was also driven by new customers implementing on MSP," he continued.

"Transaction revenues totaled $113 million, up slightly year-over-year, driven by revenue growth related to Encompass closed loans and applications, an increase in closing solution fees and higher default management revenues as foreclosure starts within our servicing business have begun to tick higher from historic lows."

Rocket-Mr. Cooper deal brings future headwinds

During the quarter and into April, ICE had several big wins for its platforms but also had to prepare for the loss of a large client.

Rocket Cos., when it completes its acquisition of Mr. Cooper, will be bringing its servicing portfolio to Sagent. Mr. Cooper owns 20% of Sagent.

But at the end of April, United Wholesale Mortgage announced it is bringing the servicing function in-house and is licensing the MSP platform. It had been using Mr. Cooper as a subservicer prior to the Rocket news. 

A Keefe, Bruyette & Woods note after the Rocket/Mr. Cooper deal was announced said the shift to Sagent could "negatively impact ICE's servicing revenues" by approximately $30 million using a $10 per loan assumption for the 2.8-million-unit portfolio.

Taking a dig at the competition

ICE Mortgage Technology added 20 new Encompass loan origination system clients, as well as the addition of UWM, "a significant new MSP client," said Ben Jackson, Intercontinental Exchange president and chairman of ICE Mortgage Technology.

In what might be considered to be a subtle dig at Rocket/Mr. Cooper/Sagent, Jackson said over the past decade, the company looked to build a life-of-loan platform "operated by a trusted, neutral third party." He later used the phrase "our neutral platform" during the presentation and brought the topic up again during the Q&A portion of the call.

A questioner asked how ICE sees Rocket's business strategy, comparing that with what it does across the mortgage lifecycle from consumer marketing to secondary marketing and recording.

Jackson, while not directly mentioning Rocket, responded "the headline is that it's a validation of our strategy."

Gardiner added Flagstar's servicing portfolio, which the bank sold to Mr. Cooper and is being switched to Sagent, was about 1% of the unit's revenues and Rocket is a little less than 3%.

Rocket isn't leaving right away

Rocket recently signed a multiyear contract, "so in the event they even do choose to move off of MSP, just be clear that it's going to take a couple of years," Gardiner said. "And there's no change to this year's guidance as a result of any of that." 

But the impact of what had been the Flagstar MSRs leaving should start to be felt by the end of 2025, he continued.

UWM also referred to ICE as "an independent, neutral and proven technology provider" in its statement on the agreement.

"They're already in our ecosystem and it was a cross-sell to bring them onto the MSP platform," Jackson added during the call.