July 20, 2023 | --- | --- | --- | |---------------------------------------------------------------------------------------------------|-------|-------| | | | | | | | | | Strategic Update and Outlook: Driving Better Trading Outcomes for Clients ❖ Chris Concannon, CEO | | | | --- | --- | |----------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------| | | | ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 Washington, D.C. 20549 FORM 10-Q or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-34091 MARKETAXESS HOLDINGS INC. | | Trading | | | --- | --- | --- | | Title of each class | Symbol | Name of each exchange on whi ...

Financial Data and Key Metrics Changes - The company generated revenue of $180 million for the quarter, with year-to-date revenue of $383 million, representing a 4% increase compared to the prior year [27][33] - Earnings per share (EPS) was reported at $1.59, with net income of $60 million [27][155] - Total commission revenue decreased by 3% in the quarter, while year-to-date figures are running 3% above prior year levels [10][33] - Record information services revenue reached $12 million, up 24% year-over-year, driven by a strong pipeline of new contracts [33] Business Line Data and Key Metrics Changes - Notional volumes in high-grade and high-yield ETFs decreased by 19% and 33% respectively, reflecting reduced trading activity due to lower volatility [6][10] - Auto-X trade volume now represents a record 10% of total credit volume, with trade count at a record 23% of total credit trades [105] - The adoption of automated tools continues to grow, with a record 146 active client firms leveraging automation tools [153] Market Data and Key Metrics Changes - Active client firms trading on the platform reached a record 2,083, with 51% being international clients [7][132] - Eurobond trade volume achieved a record, with a 31% share in Open Trading [133] - Trading volume from hedge fund and private bank clients increased by 36% year-over-year, now representing 17% of total credit volume [132] Company Strategy and Development Direction - The company is focusing on innovation through the launch of proprietary data solutions and the Adaptive Auto-X algorithm to enhance trading outcomes for clients [4][5] - The new trading platform integrates unique data products and various trading protocols, aimed at improving client workflows and trading efficiency [129][130] - The company is optimistic about the fixed income market, anticipating increased inflows as the Fed potentially halts rate hikes [50][145] Management's Comments on Operating Environment and Future Outlook - Management noted that the current low volatility environment has impacted trading activity but expressed confidence in the long-term strategy and growth potential [27][150] - The company is excited about the potential for fixed income investments, especially with the anticipated end to rate hikes [50][145] - Management highlighted the importance of regulatory developments, such as T+1 processing, which could favor electronic trading [53][82] Other Important Information - The company paid out approximately $107 million in quarterly dividends to shareholders [116] - The balance sheet remains solid with cash and investments totaling $506 million and no outstanding debt [156] - The total addressable market has expanded to $7 billion, reflecting significant growth opportunities [151] Q&A Session All Questions and Answers Question: Can you provide insights on the performance of Adaptive Auto-X? - Management indicated that Adaptive Auto-X is in early stages with positive early indications, allowing clients to submit larger parent orders that break into smaller child orders across various protocols [137][138] Question: What are the recent trends in the high-grade business? - Management acknowledged challenges in high-grade market share due to lower volatility and competitive impacts, but noted a year-over-year growth of 13% in portfolio trading [111][150] Question: How is the company interfacing with retail demand? - The company is well-positioned to support retail market growth, particularly through separately managed accounts (SMA) and the Axess IQ platform designed for private wealth firms [91][99]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number 001-34091 MARKETAXESS HOLDINGS INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorpora ...

MarketAxess Holdings Inc. (NASDAQ:MKTX) Q1 2023 Earnings Conference Call April 26, 2023 10:00 AM ET Company Participants Steve Davidson ??? Head-Investor Relations Chris Concannon ??? Chief Executive Officer Chris Gerosa ??? Chief Financial Officer Rick McVey ??? Founder and Executive Chairman Conference Call Participants Rich Repetto ??? Piper Sandler Chris Allen ??? Citi Kyle Voigt ??? KBW Alex Blostein ??? Goldman Sachs Brian Bedell ??? Deutsche Bank Daniel Fannon ??? Jefferies Simon Clinch ??? Atlantic ...

Q1 2023 Conference Call and Webcast ※ Market Axess® 1Q23 Results* – Executing Our Growth Strategy (in $ millions, except EPS data) Operating Margin 46.9% ※ Market Axess® April 26, 2023 2 Revenue | --- | --- | |---------------|--------| | NI 1 & EBITDA | 2 | | +14% | $73.6 | | +5% | $110.5 | Key Themes • Record revenues up 9%, (+11% ex. FX) including impact of 4% decline in total credit fee per million on lower duration of bonds traded in U.S. high-grade. • Strong estimated market share gains across most pro ...

Revenue and Trading Volume - In 2022, 89.3% of MarketAxess's revenues were derived from commissions for transactions executed on its platforms[14] - Total credit trading volume increased from approximately $1.7 trillion in 2018 to $2.9 trillion in 2022, with estimated market shares for U.S. high-grade and high-yield corporate bonds rising to 21.3% and 17.9%, respectively[18] - The average daily trading volume for Composite Corporate Bonds on MarketAxess platforms was approximately $9.4 billion in 2022, representing just 19.9% of the estimated addressable market of $47.5 billion[28] - For the year ended December 31, 2022, the average daily trading volume for U.S. high-grade bonds was $25.7 billion, an increase of 8.9% from $23.6 billion in 2021[35] - The average daily trading volume for emerging market debt was $20.8 billion, a slight increase of 2.0% from $20.4 billion in 2021[35] - MarketAxess executed approximately $939.6 billion in credit trading volume using Open Trading in 2022, which accounted for 35.9% of total eligible credit trading volume on its platforms[30] - MarketAxess executed $63.3 billion in corporate and municipal green bond trading volume globally in 2022, marking a 24.0% increase from 2021[72] Open Trading and Price Improvement - Open Trading generated an estimated $945.3 million in price improvement for clients in 2022, with $653.2 million from liquidity taker price improvement and $292.1 million from liquidity provider price improvement[20] - Approximately 35.9% of all eligible credit volume on the MarketAxess platform was executed via Open Trading protocols in 2022[45] - The company reported that Open Trading generated approximately $945.3 million of price improvement for clients in 2022[61] Client and Market Expansion - Revenues from international clients grew from 15.7% of total revenue in 2018 to 19.6% in 2022, with over 1,000 active international client firms[31] - The average daily trading volume in the EMEA, Latin America, and APAC regions on MarketAxess platforms increased from $1.8 billion in 2018 to $3.7 billion in 2022[31] - The company plans to leverage its Open Trading functionality to capture additional market share across core credit markets[39] Technology and Innovation - The company delivered approximately 710 unique new business and technical features to clients during the year ended December 31, 2022[26] - The proprietary pricing algorithm Composite+ generates near real-time prices for approximately 33,000 corporate and sovereign bonds, enhancing trading outcomes[58] - The technology team delivered approximately 710 unique new business and technical features to clients during the year ended December 31, 2022[65] - The company utilizes cloud technology to improve development velocity and enhance its technology platform, ensuring scalability and resiliency[65] Regulatory Environment and Compliance - The company is regulated by multiple authorities globally, including the FCA in the U.K. and ESMA in the E.U., which oversee its operations[90] - The MiFID II and MiFIR regulations introduced significant changes aimed at enhancing market transparency and efficiency, impacting the company's operations[95] - The SEC proposed rules to expand Regulation ATS and amend the definition of an "exchange" to include Communication Protocol Systems, affecting the company's trading protocols[89] - The company is subject to risks related to compliance with extensive regulations, which may affect trading volumes and increase operational costs[140] - Compliance with evolving data privacy regulations, such as GDPR, is critical, with potential penalties for non-compliance that could adversely affect the company's reputation and business[189] Competition and Market Risks - The company faces intense competition in the electronic fixed-income trading markets, which could reduce market share and harm financial performance[78] - The company competes with various electronic trading platforms, including Tradeweb and Bloomberg, in both credit and municipal markets[14] - The company faces substantial competition in the electronic financial services market, with competitors potentially offering lower costs and a wider range of trading solutions[143] - The company has experienced significant declines in trading volumes in the financial markets, which may continue to impact revenues and profitability during periods of low volatility or low trading volume[130] Workforce and Employee Engagement - As of December 31, 2022, MarketAxess had 744 employees, with a 10.1% increase in workforce compared to the previous year[110] - The global workforce composition was approximately 72.3% men and 27.7% women, with U.S. employees being 29.9% Asian, 5.2% Black or African American, and 7.6% Hispanic or Latinx[112] - MarketAxess increased its investment in employee learning and development in 2022, offering customized management training and leadership programs[116] - The overall employee engagement rate was measured at 81%, consistent with global averages for financial services[117] Financial Performance and Future Outlook - The company has experienced significant growth in trading volumes, revenues, and profitability in recent years, but future growth rates cannot be assured[149] - The introduction of new fee plans may not result in increased transaction volumes or revenues, and could potentially lead to reduced business from clients[150] - The company has experienced significant decreases in overall market volumes in the fixed-income markets, which could harm its business and profitability[138] Acquisitions and Investments - The company has made acquisitions in the past, including LiquidityEdge in 2019, Deutsche Börse's regulatory reporting business in 2020, and MuniBrokers in 2021[194] - The company announced a significant minority investment in RFQ-hub in 2022 to enhance its capabilities[197] Operational Risks - The company is exposed to operational risks due to self-clearing of bond transactions, which may lead to inefficiencies and increased expenses[167] - The integrity and capacity of the company's electronic trading platforms are essential for providing reliable service to clients, with potential disruptions leading to a material adverse effect on business[177] - The company faces risks from systems failures, cyber-attacks, and operational disruptions that could harm its reputation and lead to financial losses[185]

MarketAxess Holdings Inc. (NASDAQ:MKTX) Q4 2022 Earnings Conference Call January 25, 2023 10:00 AM ET Company Participants Stephen Davidson - Head of Investor Relations Richard McVey - Chairman and Chief Executive Officer Chris Concannon - President and Chief Operating Officer Christopher Gerosa - Chief Financial Officer Conference Call Participants Richard Repetto - Piper Sandler Christopher Allen - Citigroup Kyle Voigt - KBW Gautam Sawant - Credit Suisse Alex Blostein - Goldman Sachs Daniel Fannon - Jeffe ...

Key Themes Source: Corporate bond index duration data sourced from Bloomberg U.S. Corporate Bond Index; U.S. Dollar index data sourced from FactSet. ※ Market Axess® +8% (+10% ex. FX) +8% $100.2 +7% • Financial results include impact of lower duration on U.S. high-grade fee plan; trends improving with corporate bond index duration now 6% above the lows in October 2022. • Higher estimated market volumes and favorable backdrop for fixed income creating attractive operating environment for our model in 2023. 4 ...

Financial Data and Key Metrics Changes - Third quarter revenue was $172 million, up 6% year-over-year, driven by strong trading volume and record market share gains, but negatively impacted by lower duration of U.S. high-grade bonds and a strengthening U.S. dollar [30][31] - Excluding foreign currency fluctuations, revenues would have increased approximately 9% [31] - Total commission revenue increased 7%, with growth in total credit and total rates commission revenue driven by healthy increases in trading volume and estimated market share [34] Business Line Data and Key Metrics Changes - Record trading volume in municipal bonds and portfolio trading, with portfolio trading volume reaching $25 billion in Q3 [26] - Automated trading volume increased to $52 billion, reflecting continued strong adoption during heightened volatility [23] - Open Trading price improvement generated $260 million in estimated transaction cost savings for clients, double the savings from the previous year [21] Market Data and Key Metrics Changes - Emerging markets trading volume grew 8% during the quarter, with local markets' trading volume increasing 33% on a reported basis [27] - U.S. Treasuries saw an increase in active client firms trading on the platform, from 122 to 226 year-over-year [10] - Investment-grade bond indices were down 22% year-to-date, reflecting significant market volatility [12] Company Strategy and Development Direction - The company continues to execute its growth strategy, focusing on expanding market share across various products and enhancing its competitive position in the institutional client e-trading space [41][42] - The leadership position in global credit is expanding beyond U.S. high-grade bonds, with record market share in high yield and municipal bonds [7] - The company is leveraging its global client network and technology to grow share in existing products and add new product areas [17] Management's Comments on Operating Environment and Future Outlook - Management believes that higher bond yields create a better investing and trading environment, despite current volatility [13] - The expectation is that volatility will remain high in 2023, which may favor the company's trading model [87] - The company anticipates that the demand for automation in trading will continue to grow, driven by clients' needs for efficient trading solutions [96] Other Important Information - The effective tax rate was 24.8%, with expectations for the full year to be at the upper end of the previously stated range of 24% to 26% [33] - The company paid out $26 million in quarterly dividends and repurchased 280,000 shares for a total of $88 million year-to-date [39][90] - Cash and investments as of September 30 were $352 million, with trailing 12-month free cash flow of $239 million [38] Q&A Session Summary Question: What is driving the market share gains in U.S. high yield? - Management indicated that liquidity conditions are challenging, leading clients to rely on the all-to-all trading model for diversified sources of liquidity and price improvement [45][46] Question: What is the impact of proposed SEC regulations on central clearing? - Management believes that central clearing will benefit the market overall, but the implementation is still a year or two away [48][51] Question: How did fee per million progress during the quarter? - Fee capture was stable for total credit, with slight pressure from high-grade due to movements in bond yields and years to maturity [56][58] Question: What is the outlook for high-grade trading activity? - Management noted that high-grade market volumes are holding up well despite volatility, but outflows from bond funds are impacting activity [65][66] Question: What enhancements have been made to data and analytics capabilities? - The company has rolled out additional products for its CP+ offering and is seeing growing demand for portfolio construction data [68][71] Question: What are the investment priorities for the cash position? - The company plans to invest in the platform, consider opportunistic M&A, and return capital to shareholders through dividends and repurchases [96][97]