BGC(US:BGC)2025-11-06 16:02Financial Data and Key Metrics Changes - The company reported record third quarter revenues of $737 million, a 31% increase from $561 million a year ago [4] - Adjusted earnings grew by 22.4% to $155.1 million, with post-tax adjusted earnings increasing by 11.5% to $141.1 million, resulting in post-tax adjusted earnings per share of $0.29 [12] - Adjusted EBITDA increased by 10.7% to $167.6 million [12] Business Line Data and Key Metrics Changes - ECS revenues grew by 114% to $241.6 million, driven by OTC and strong organic growth [6] - Rates revenues increased by 12.1% to $195.3 million, reflecting higher volumes across major interest rate products [7] - Foreign exchange revenues were up 15.9% to $106.7 million, primarily due to strong growth in emerging market currencies [7] - Credit revenues increased by 1.6% to $69.1 million, driven by higher credit derivative and structured credit volumes [7] - Equities revenues grew by 13.2% to $60.4 million, reflecting strong European and U.S. equity volumes [7] - Data, network, and post-trade revenues grew by 11.9% to $34.3 million, excluding Capital Lab [8] Market Data and Key Metrics Changes - EMEA revenues increased by 37.4%, Americas revenues increased by 28.1%, and Asia-Pacific revenues increased by 17.4% [11] - The U.S. Treasury market share grew to an all-time high of 37%, significantly outpacing the market [5] - FMX UST generated record third quarter average daily volume of $59.4 billion, more than 12% higher compared to last year [9] Company Strategy and Development Direction - The company is focused on enhancing profitability and margins through a $25 million cost reduction program, expected to be completed by year-end [5] - The company aims to continue growing SOFR ADV and open interest, with expectations for similar adoption in U.S. Treasury Futures offerings in 2026 [9][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver strong growth in a mixed macro environment, highlighting the strength and scale of its global platform [4] - The company anticipates generating revenues of between $720 million and $770 million in the fourth quarter of 2025, representing approximately 30% revenue growth at the midpoint [13] Other Important Information - The company’s liquidity was reported at $924.7 million as of September 30, compared to $897.8 million at year-end 2024 [12] - The board reapproved a share repurchase authorization for up to $400 million [12] Q&A Session Summary Question: What allowed BGC to outperform some of the industry proxies despite a slowdown in on-exchange volumes? - Management attributed the strong performance to targeted growth within the ECS sector and the hiring of around 150 new brokers, which enabled market share gains [16] Question: Can you elaborate on the strong growth in FMX and expectations for FCM onboardings? - Management noted that FMX has successfully onboarded 11 FCMs and achieved significant growth in SOFR futures ADV and open interest, with expectations for continued growth in U.S. Treasuries [18][20] Question: What contributed to the strong share growth in FMX cash markets? - Management indicated that the growth was due to the hard work over several years and the viability of FMX as a second choice in the market, leading to a market share increase to 37% [23] Question: How much leverage does the energy segment have to higher adoption of cloud and AI? - Management acknowledged involvement in energy procurement for data centers, benefiting from relationships established through Newmark [25] Question: Can electronic credit revenues grow at a similar pace as Tradeweb or MarketAxess? - Management expressed confidence that electronic credit revenues can grow at competitive rates, with ongoing launches of new electronic protocols [27]