Core Insights - Tradeweb Markets (TW) is positioned to benefit from structural growth in trading automation within the financial services industry [1] Company Overview - Tradeweb Markets operates in the financial services sector, focusing on trading automation [1] Analyst Background - The analysis is conducted by a fund manager/analyst with over 18 years of experience in the financial markets, specifically on the buy side and related to portfolio management [1]

Elliott Investment Management said on Tuesday it had a significant stake in Toyota Industries and had been sharing its concerns about the planned buyout of the forklift maker by Toyota group companies... ...

NEW YORK--(BUSINESS WIRE)--Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today announced the appointment of Sandra "Sandee†Buchanan as Chief People Officer and member of the Executive Committee. She will lead the advancement of Tradeweb's talent strategy, overseeing efforts to attract, develop and retain top talent while building on its strong culture of collaboration. Buchanan will report to Chief Execu. ...

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Financial Data and Key Metrics Changes - The company reported revenues of $509 million for the third quarter, up 13% year-over-year on a reported basis and 11% on a constant currency basis [28] - Year-to-date revenues are up 21% or 17% organically, indicating strong growth momentum [5] - Adjusted EBITDA margin increased by 90 basis points to 54.2% compared to the previous year [29] Business Line Data and Key Metrics Changes - Rates produced its second highest revenue quarter, driven by organic growth across swaps and global government bonds, while mortgages achieved record revenues [9] - Credit growth was led by strength in municipal bonds and European credit, with U.S. credit revenues declining nearly 30% year-over-year [21][22] - Money markets revenue growth was supported by the addition of ICD, which saw a 7% increase relative to the second quarter [9] Market Data and Key Metrics Changes - International revenues grew by 25% year-over-year, reflecting successful strategic initiatives in emerging markets and APAC [8] - The company achieved a 10% increase in electronic industry average daily volume year-over-year, while voice average daily volume increased by 26% [11] Company Strategy and Development Direction - The company is focused on delivering innovative solutions that enhance liquidity and efficiency across the global fixed income ecosystem [7] - There is a strong emphasis on expanding electronic trading capabilities to capture market share from traditional voice trading [39] - The company is also investing in emerging markets and digital asset initiatives, with revenues from emerging markets nearly tripling year-over-year [26] Management's Comments on Operating Environment and Future Outlook - Management noted that the current macro environment is characterized by low interest rate volatility and geopolitical uncertainty, which are impacting client activity [5][39] - The company anticipates that volatility will normalize and data will return, which will drive future trading activity [39] - Management expressed confidence in the long-term growth potential for swaps, with only 30% of the cleared swaps market currently electronified [19] Other Important Information - The company reached an agreement to renew its market data contract with LSEG for three years, which is expected to increase in value by 9% annually [36] - The company ended the quarter with $1.9 billion in cash and cash equivalents, and free cash flow reached approximately $987 million for the trailing twelve months [34] Q&A Session Summary Question: What potential catalysts could spark volatility and improve activity? - Management indicated that the lack of data due to the government shutdown has led to muted activity, but potential catalysts include midterm elections and geopolitical uncertainties [44][50] Question: What is driving the greater mix of voice trades in Treasuries? - Management explained that complex trades, often involving larger notional amounts, are still predominantly voice-driven, but they expect electronic trading share to recover [55][60] Question: How does the company view the outlook for rates? - Management believes the current environment is constructive, with lower rates positively impacting trading volumes and fee structures [72][76] Question: What opportunities exist in tokenized assets? - Management highlighted the potential for tokenization to modernize trading processes, improve efficiency, and generate revenue, positioning the company as a market leader in this space [84][86]

Financial Data and Key Metrics Changes - The company reported revenues of $509 million for the third quarter, up 13% year-over-year on a reported basis and 11% on a constant currency basis [28] - Year-to-date revenues are up 21% or 17% organically, indicating strong growth momentum [5] - Adjusted EBITDA margin for the year to date is 54.2%, an increase of 90 basis points compared to the previous year [29] Business Line Data and Key Metrics Changes - Rates produced the second highest revenue quarter, driven by organic growth across swaps and global government bonds, while mortgages achieved record revenues [9] - Credit growth was led by strength in municipal bonds and European credit, with U.S. credit revenues declining due to lower retail corporate credit revenues [21][22] - Other revenues grew over 50%, reflecting contributions from emerging digital asset initiatives [10] Market Data and Key Metrics Changes - International revenues grew by 25% year-over-year, highlighting the success of strategic initiatives in emerging markets and Asia-Pacific [8] - U.S. Treasury revenues decreased slightly by 2% year-over-year, impacted by lower wholesale trends [11] - The company achieved record revenues in global swaps, driven by strong client engagement and a favorable macro backdrop, with global swaps revenues growing over 30% year-over-year [18] Company Strategy and Development Direction - The company is focused on expanding its electronic trading solutions to capture market share from traditional voice trading [39] - There is a strong emphasis on innovation, particularly in the areas of tokenization and digital assets, to modernize financial asset trading [84][85] - The company aims to enhance liquidity and efficiency across the global fixed income ecosystem, adapting to changing market conditions [7] Management's Comments on Operating Environment and Future Outlook - Management noted that the current macro environment is characterized by low interest rate volatility and geopolitical uncertainty, which are impacting client activity [5][39] - The company anticipates that volatility will normalize and data will return, which will drive client activity and repositioning of risk [39] - Despite challenges, the company remains optimistic about its growth trajectory, particularly in international markets, which are expected to continue strong performance [40] Other Important Information - The company reached an agreement to renew its market data contract with LSEG for three years, with an annual increase of 9% [36] - The company ended the quarter with $1.9 billion in cash and cash equivalents, and free cash flow reached approximately $987 million for the trailing twelve months [34] Q&A Session Summary Question: What potential catalysts could spark volatility and improve activity? - Management indicated that the lack of data due to the government shutdown has contributed to muted activity, but potential catalysts include midterm elections and geopolitical uncertainties [46][50] Question: What is driving the greater mix of voice trades in Treasuries? - Management explained that complex trades, often involving larger notional amounts, are still predominantly voice-driven, but they expect electronic trading share to recover [55][60] Question: How does the outlook for rates impact trading volumes? - Management believes that lower rates can positively impact fee structures and trading volumes, particularly in swaps and cash credit [72][77] Question: What opportunities exist in tokenized assets? - Management highlighted the potential for tokenization to modernize trading, improve efficiency, and provide significant client benefits, positioning the company as a market leader in this space [84][85]

Financial Data and Key Metrics Changes - Revenues for Q3 2025 reached $509 million, up 13% year over year on a reported basis and 11% on a constant currency basis [26] - Year-to-date revenues increased by 21% or 17% organically, indicating strong growth momentum [4] - Adjusted EBITDA margin for the year to date was 54.2%, an increase of 90 basis points compared to the full year 2024 margins [27] Business Line Data and Key Metrics Changes - Rates business produced its second highest revenue quarter, driven by organic growth across swaps and global government bonds, while mortgages achieved record revenues [9] - Credit growth was led by strength in municipal bonds and European credit, with overall credit revenues showing low single-digit growth [19] - Money markets revenue growth was supported by the addition of ICD, which saw a 7% increase relative to the second quarter [9] - Equities posted strong growth with revenues up 17% year over year, driven by global ETFs and equity derivatives [9] Market Data and Key Metrics Changes - International revenues grew by 25% year over year, reflecting successful strategic initiatives in emerging markets and APAC [6] - U.S. Treasury revenues decreased slightly by 2% year over year, impacted by weaker wholesale trends [11] - Global swaps revenues grew over 30% year over year, with record revenues in emerging market and institutional dollar swaps [18] Company Strategy and Development Direction - The company is focused on expanding its electronic trading solutions to capture market share from traditional voice trading [55] - There is a strong emphasis on innovation in electronic solutions to enhance market efficiency and transparency [15] - The company aims to leverage its established presence in developed markets to drive growth in emerging markets, with significant revenue potential identified [24] Management's Comments on Operating Environment and Future Outlook - The current macro environment is characterized by low interest rate volatility and geopolitical uncertainty, which presents both challenges and opportunities [4] - Management believes that the setup heading into 2026 is constructive, with expectations for normalized volatility and increased client activity [38] - The company is optimistic about the long-term growth potential in swaps and fixed income markets, despite current low volatility [18] Other Important Information - The company reached an agreement to renew its market data contract with LSEG for three years, expected to increase in value by 9% annually [35] - The company holds approximately 1.7 billion Canton coins with a fair value of approximately $56 million, which is recorded on the balance sheet [28] Q&A Session Questions and Answers Question: What potential catalysts could spark volatility and improve activity? - Management noted that the lack of data due to the government shutdown has contributed to muted activity, but potential catalysts include upcoming midterm elections and geopolitical uncertainties [49][53] Question: What is driving the greater mix of voice trades in the Treasury market? - Management indicated that voice trading remains prevalent for complex multi-leg trades and larger notional transactions, but they expect electronic trading share to recover [58][64] Question: How does the outlook for lower rates impact trading volumes? - Management explained that lower rates can positively impact fee per million in swaps and cash credit, as well as encourage client-driven activity [90][92]

3Q25 EARNINGS CONFERENCE CALL OCTOBER 30, 2025 © 2025 Tradeweb Markets LLC. All rights reserved. 113 112 115 239 178 30 167 101 115 140 214 236 142 204 122 179 179 182 253 212 142 166 140 158 Disclaimers The information in this presentation is current only as of its date and may have changed. We undertake no obligation to update this information in light of new information, future events or otherwise. Basis of Presentation Tradeweb Markets Inc. (unless the context otherwise requires, together with its subsi ...

Core Insights - Tradeweb Markets (TW) reported quarterly earnings of $0.87 per share, exceeding the Zacks Consensus Estimate of $0.83 per share, and showing an increase from $0.75 per share a year ago, resulting in an earnings surprise of +4.82% [1] - The company achieved revenues of $508.6 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.05% and up from $448.92 million year-over-year [2] - Tradeweb has consistently outperformed consensus EPS and revenue estimates over the last four quarters [2] Earnings Outlook - The sustainability of Tradeweb's stock price movement will largely depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.84, with projected revenues of $514.72 million, and for the current fiscal year, the estimate is $3.40 on $2.04 billion in revenues [7] Industry Context - The Financial - Investment Bank industry, to which Tradeweb belongs, is currently ranked in the top 11% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - The correlation between near-term stock movements and earnings estimate revisions suggests that investors should monitor these revisions closely [5]

Client Base and Market Presence - The company serves over 3,000 clients globally across various sectors, facilitating trading in multiple asset classes including rates, credit, equities, and money markets[219] - The company operates in over 85 countries and offers solutions across the trade lifecycle, enhancing transparency and efficiency for institutional investors[220] Financial Performance - Total revenue for the three months ended September 30, 2025, was $508.6 million, an increase of $59.7 million or 13.3% compared to $448.9 million in the same period of 2024[258] - Operating income for the quarter was $210.4 million, reflecting a 32.0% increase from $159.3 million in the same quarter of 2024[258] - Net income attributable to Tradeweb Markets Inc. was $185.6 million, a 63.0% increase from $113.9 million in the prior year[258] - Total revenue for the nine months ended September 30, 2025, was $1,531,246,000, representing a $268,641,000 increase or 21.3% compared to $1,262,605,000 in 2024[296] - Net income attributable to Tradeweb Markets Inc. for the nine months ended September 30, 2025, was $487.8 million, a 35.8% increase from $359.3 million in 2024[295] Revenue Sources - The company’s revenue primarily comes from transaction fees, commissions, subscription fees, and market data fees[239] - Transaction fees and commissions accounted for $421.3 million, representing 82.8% of total revenue, up $47.8 million or 12.8% from $373.5 million in the prior year[259] - Subscription fees increased by $9.6 million to $81.4 million, maintaining a steady 16.0% of total revenue, primarily due to a shift in pricing plans among market participants[261] - Revenue from the rates asset class increased by $41.4 million or 17.7% to $274.5 million, primarily due to higher variable transaction fees and commissions on increased trading volumes for rates derivatives products[268] - Revenues from the credit asset class rose by $3.0 million or 2.6% to $121.3 million, driven by higher variable transaction fees on increased trading volumes for municipals[270] - Revenues from the equities asset class increased by $4.3 million or 16.9% to $29.8 million, primarily due to higher variable transaction fees on increased trading volumes for ETFs and equity derivatives[272] - Money markets revenue increased by $6.8 million or 18.7% to $42.9 million, attributed to three months of basis point commissions from client money market fund investments following the acquisition of ICD[274] Expenses and Costs - The company experienced a 3.0% increase in total expenses, which amounted to $298.2 million, up from $289.6 million in the previous year[258] - Employee compensation and benefits increased by $4.8 million or 3.0% to $165.0 million for the three months ended September 30, 2025, due to an increase in headcount[284] - Total operating expenses increased by $143.8 million or 18.6% to $916.9 million for the nine months ended September 30, 2025, compared to $773.1 million for the same period in 2024[312] - Depreciation and amortization expenses increased by $33.0 million or 21.0% to $190.1 million, driven by the amortization of assets from the ICD Acquisition[313] Market Trends and Strategic Initiatives - The electronic trading market is growing due to demand for transparency, higher execution quality, and lower costs, positioning the company favorably for future growth[224] - The company is actively engaged in the electronification of trading activities, which is expected to mitigate the impact of market volatility on revenues[229] - Regulatory changes may increase demand for the company’s platforms, although compliance may require additional resources that could impact profitability[230] Acquisitions and Growth - The acquisition of Institutional Cash Distributors (ICD) on August 1, 2024, contributed $17.2 million in revenues and an operating loss of $0.3 million for the three months ended September 30, 2024[226] - The acquisition of ICD on August 1, 2024, contributed to the significant organic growth and client engagement during the quarter[261] Cash Flow and Capital Management - Cash and cash equivalents increased to approximately $1.9 billion as of September 30, 2025, up from $1.3 billion at the end of 2024[328] - Net cash provided by operating activities for the nine months ended September 30, 2025, was $811.7 million, an increase of $196.0 million compared to the same period in 2024[358] - Net cash used in investing activities for the nine months ended September 30, 2025, was $91.7 million, significantly lower than $922.9 million in the same period of 2024[360] Taxation and Compliance - The effective tax rate for the three months ended September 30, 2025, was approximately 21.9%, down from 25.0% in the same period of 2024[294] - The Company is subject to a 15% corporate alternative minimum tax effective for taxable years beginning after December 31, 2022, but it did not impact the effective tax rate for the three and nine months ended September 30, 2025[236] Stock and Shareholder Information - The board declared a cash dividend of $0.12 per share for the fourth quarter of 2025, payable on December 15, 2025[332] - The company did not repurchase any shares under the 2022 Share Repurchase Program during the nine months ended September 30, 2025, with $179.9 million remaining available for repurchase[336]