Marketaxess Holdings Q4 2025 MarketAxess Holdings Earnings Call | AllMind AI Earnings | AllMind AI
Q4 2025 MarketAxess Holdings Earnings Call
Speaker #1: Ladies and gentlemen, thank you for standing
Speaker #1: By, and welcome to the MarketAxess Fourth Quarter and Full Year 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode.
Speaker #1: Later, we will conduct a question-and-answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. To withdraw your question, press star one again.
Speaker #1: As a reminder, this conference call is telephone keypad. To withdraw your 6th, 2026, I would now Davidson, Head of Investor Relations at MARKETAXESS. Please go ahead, like to turn the call over to Steve being recorded.
Speaker #1: sir.
Speaker #2: Good morning and
Steve Davidson: Good morning, and welcome to the MarketAxess fourth quarter and full year 2025 earnings conference call. For the call, Chris Concannon, Chief Executive Officer, will provide you with an update on our strategy and our business, and Ilene Fiszel Bieler, Chief Financial Officer, will review our financial results. Before I turn the call over to Chris, let me remind you that today's call may include forward-looking statements. These statements represent the company's belief regarding future events that, by their nature, are uncertain. The company's actual results and financial condition may differ materially from what is indicated in those forward-looking statements. For a discussion of some of the risks and factors that could affect the company's future results, please see the description of risk factors in our annual report on Form 10-K for the year ended December 31, 2024.
Steve Davidson: Good morning, and welcome to the MarketAxess fourth quarter and full year 2025 earnings conference call. For the call, Chris Concannon, Chief Executive Officer, will provide you with an update on our strategy and our business, and Ilene Fiszel Bieler, Chief Financial Officer, will review our financial results. Before I turn the call over to Chris, let me remind you that today's call may include forward-looking statements. These statements represent the company's belief regarding future events that, by their nature, are uncertain.
Speaker #2: welcome to the MARKETAXESS Fourth Quarter and Full Year On February 2025 Earnings Conference Call. For the call, Chris Concannon, Chief Executive Officer, will provide you with an update on our strategy and our business, and Ilene Fizelle Bieler, Chief Financial Officer, will review our financial results.
Speaker #2: Before I turn the call over to Chris, let me remind you that today's call may include forward-looking statements. These statements represent the company's belief regarding future events, which are uncertain.
Speaker #2: The company's actual results and financial condition may differ materially from what is indicated in those forward-looking statements. For a discussion of some of the risks and factors that could affect the company's future results, please see the description of risk factors in our annual report on that, by their nature, are Form 10-K for the year ended December 31st, 2024.
Steve Davidson: The company's actual results and financial condition may differ materially from what is indicated in those forward-looking statements. For a discussion of some of the risks and factors that could affect the company's future results, please see the description of risk factors in our annual report on Form 10-K for the year ended December 31, 2024. I would also direct you to read the forward-looking statement disclaimer in our quarterly earnings release, which was issued earlier this morning and is now available on our website. Now let me turn the call over to Chris.
Steve Davidson: I would also direct you to read the forward-looking statement disclaimer in our quarterly earnings release, which was issued earlier this morning and is now available on our website. Now let me turn the call over to Chris.
Speaker #2: I would also direct you to read the forward-looking statement and our disclaimer in the quarterly earnings release, which was issued earlier this morning and is now available on our website.
Speaker #2: Now, let
Speaker #2: Chris, good morning, and thank you for joining me. I'll turn the call over to
Chris Concannon: Good morning, and thank you for joining us to review our Q4 and full year 2025 financial results. We are pleased with the progress we achieved in delivering new protocols and functionality in 2025, and excited about our prospects and plans for 2026. First, we enhanced the market access advantage in 2025 by expanding our global network, enhancing our differentiated liquidity, and strengthening our deep proprietary data and analytics. These key components of the market access advantage are further complemented by our investment in multi-protocol solutions for the buy side and for the sell side. We made significant progress in 2025, delivering and growing protocols across our three channels: portfolio trading protocols, block trading protocols, dealer matching protocols, automation protocols, and our closing auction protocol.
Chris Concannon: Good morning, and thank you for joining us to review our Q4 and full year 2025 financial results. We are pleased with the progress we achieved in delivering new protocols and functionality in 2025, and excited about our prospects and plans for 2026. First, we enhanced the market access advantage in 2025 by expanding our global network, enhancing our differentiated liquidity, and strengthening our deep proprietary data and analytics. These key components of the market access advantage are further complemented by our investment in multi-protocol solutions for the buy side and for the sell side. We made significant progress in 2025, delivering and growing protocols across our three channels: portfolio trading protocols, block trading protocols, dealer matching protocols, automation protocols, and our closing auction protocol.
Speaker #3: Quarter and full-year 2025 financial results. We are pleased with the progress we achieved in delivering new protocols and functionality in 2025, and excited about our prospects and plans for 2026.
Speaker #3: First, we enhanced the MarketAxess advantage in 2025 by expanding our global network, enhancing our differentiated liquidity, and strengthening our deep proprietary data and analytics.
Speaker #3: These key components of the MarketAxess advantage are further complemented by our investment in multi-protocol solutions for the buy-side and for the sell-side. We've made significant progress in 2025 delivering and growing protocols across our three channels: portfolio trading protocols, block trading protocols, dealer matching protocols, automation protocols, and our closing auction protocol.
Speaker #3: Next, we have a clear and achievable technology and product roadmap that positions us to achieve our three-year December. In 2025, we delivered critical protocols and workflow tools that will help achieve the first year's milestones.
Chris Concannon: Next, we have a clear and achievable technology and product roadmap that positions us to achieve our three-year targets that we announced in December. In 2025, we delivered critical protocols and workflow tools that will help achieve the first year's milestones. Now, 2026 is about execution and building on the momentum we had as we exited 2025. Turning to our financial results on slide 3. In 2025, we generated record revenue of $846 million, including strong 10% growth in product areas outside US credit. Record total revenue was underpinned by record total ADV, driving record commission revenue combined with record services revenue, helping to drive record annual free cash flow generation of $347 million. Momentum continued to build with our new initiatives last year.
Chris Concannon: Next, we have a clear and achievable technology and product roadmap that positions us to achieve our three-year targets that we announced in December. In 2025, we delivered critical protocols and workflow tools that will help achieve the first year's milestones. Now, 2026 is about execution and building on the momentum we had as we exited 2025. Turning to our financial results on slide 3. In 2025, we generated record revenue of $846 million, including strong 10% growth in product areas outside US credit. Record total revenue was underpinned by record total ADV, driving record commission revenue combined with record services revenue, helping to drive record annual free cash flow generation of $347 million. Momentum continued to build with our new initiatives last year.
Speaker #3: Now, 2026 is about execution and building on the momentum we had as we exited 2025. Turning to three, in 2025, to our financial results on slide—we generated record revenue of $846 million, including strong 10% U.S.
Speaker #3: Credit. Record total revenue was underpinned by record total growth in product areas outside revenue, combined with record services revenue, helping to drive record annual free cash flow generation of $347 million.
Speaker #3: Momentum continued to build with our new initiative last year. We exited 2025 with a 29% increase in block trading ADV, including record block trading ADV in emerging markets.
Chris Concannon: We exited 2025 with a 29% increase in block trading ADV, including record block trading ADV in emerging markets, 28% estimated market share in US high-yield portfolio trading, and over $3 billion in trading volume in our new dealer-initiated protocol, Mid-X. We continued to be disciplined with our expense management, with 5% growth in non-GAAP expenses in 2025. We have returned a total of $474 million to investors through $360 million of share repurchases and $114 million in dividends. In addition to establishing our three-year plan, we announced an enhanced capital return plan of $400 million, including a $300 million ASR. We just completed the ASR earlier this week with the final delivery of 360,000 shares.
Chris Concannon: We exited 2025 with a 29% increase in block trading ADV, including record block trading ADV in emerging markets, 28% estimated market share in US high-yield portfolio trading, and over $3 billion in trading volume in our new dealer-initiated protocol, Mid-X. We continued to be disciplined with our expense management, with 5% growth in non-GAAP expenses in 2025. We have returned a total of $474 million to investors through $360 million of share repurchases and $114 million in dividends. In addition to establishing our three-year plan, we announced an enhanced capital return plan of $400 million, including a $300 million ASR. We just completed the ASR earlier this week with the final delivery of 360,000 shares.
Speaker #3: We achieved a 28% estimated market share in U.S. high-yield portfolio trading and over $3 billion in trading volume in our new dealer initiative protocol, MIDEX. We continued to be disciplined with our expense management, with 5% growth in non-GAAP expenses in 2025.
Speaker #3: We have returned a total of $474 million to investors, through $360 million of share repurchases and $114 million in dividends. In addition to establishing our three-year plan, we announced an enhanced capital return plan of $400 million, including a $300 million ASR.
Speaker #3: We just completed the ASR earlier this week with the final delivery of 360,000 shares. Through the completion of the ASR, we have now retired 1.7 million shares to date.
Chris Concannon: Through the completion of the ASR, we have now retired 1.7 million shares to date. In summary, I'm encouraged by the significant product deliveries that we made in 2025 and the progress we achieved across our strategic channels: portfolio trading, dealer-initiated, and block trading. The investments that we are making to help drive higher levels of revenue and market share growth in US credit are beginning to show some progress. I just wanted to provide some context for our January trading volume statistics that we released yesterday. In January, we generated record total credit ADV, driven by strong growth across all credit product areas, with record ADV in our emerging markets business up 50%. Strong market volumes, combined with the continued momentum in our new initiatives, helps drive strong growth in our total credit preliminary variable commission revenue.
Chris Concannon: Through the completion of the ASR, we have now retired 1.7 million shares to date. In summary, I'm encouraged by the significant product deliveries that we made in 2025 and the progress we achieved across our strategic channels: portfolio trading, dealer-initiated, and block trading. The investments that we are making to help drive higher levels of revenue and market share growth in US credit are beginning to show some progress. I just wanted to provide some context for our January trading volume statistics that we released yesterday. In January, we generated record total credit ADV, driven by strong growth across all credit product areas, with record ADV in our emerging markets business up 50%. Strong market volumes, combined with the continued momentum in our new initiatives, helps drive strong growth in our total credit preliminary variable commission revenue.
Speaker #3: In summary, I'm encouraged by the significant product deliveries that we made in 2025 and the progress we achieved across our strategic channels: dealer-initiated and block trading.
Speaker #3: The investments that we are making to help portfolio trading, and market share growth in U.S. credit are beginning to show some progress. I just wanted to provide some context for our January trading volume statistics that we released yesterday.
Speaker #3: In January, we generated record total credit ADV, driven credit product areas, with by strong growth across all record ADV in our emerging markets business up 50%.
Speaker #3: The continued momentum in our new strong market volumes, combined with initiatives, helped drive strong growth in our total credit preliminary variable commission revenue. Estimated market share in the U.S.
Chris Concannon: Estimated market share in US high-grade was lower than we would have liked, but it was negatively impacted by a 92% increase in new issue block activity. While this has a temporary impact on share, it's good for overall market volumes and turnover growth over time. US high-grade turnover increased 95% in January, levels we have not seen since approximately 2011. Before moving to the next slide, I wanted to welcome two new members to our board of directors, Doug Cifu and Ken Schiciano, who will be joining our board as of 1 March. Doug brings deep fintech, market structure, and regulatory expertise from a major global market maker, and Ken has three decades of experience in fintech and private equity. Both will be integral to the board and me as we continue to execute our long-term strategy....
Chris Concannon: Estimated market share in US high-grade was lower than we would have liked, but it was negatively impacted by a 92% increase in new issue block activity. While this has a temporary impact on share, it's good for overall market volumes and turnover growth over time. US high-grade turnover increased 95% in January, levels we have not seen since approximately 2011. Before moving to the next slide, I wanted to welcome two new members to our board of directors, Doug Cifu and Ken Schiciano, who will be joining our board as of 1 March. Doug brings deep fintech, market structure, and regulatory expertise from a major global market maker, and Ken has three decades of experience in fintech and private equity. Both will be integral to the board and me as we continue to execute our long-term strategy....
Speaker #3: high-grade was lower than we would have liked, but it was negatively impacted by a 92% increase in new issue block activity. While this has a temporary impact on share, it is good for overall market volumes and turnover growth over time.
Speaker #3: High-grade turnover increased in the U.S. by 95% in January, reaching levels we have not seen since approximately 2011. Before moving to the next slide, I wanted to welcome two new members to our board of directors.
Speaker #3: Doug Sifu and Ken Schijano, who will be joining our board as of March 1st. Doug brings deep fintech, market structure, and regulatory expertise from a major global market maker, and Ken has three decades of experience in fintech and private equity.
Speaker #3: Both will be integral to the board and me as we continue to execute our long-term strategy. Slides four and five really drive home how well we have enhanced the MARKETAXESS advantage in 2025.
Chris Concannon: Slides 4 and 5 really drive home how well we have enhanced the market access advantage in 2025. Most of the KPIs on slide 4 show healthy growth rates, reflecting the underlying health of our franchise. This shows that in the investments we have made to enhance our products and provide clients with new workflow tools and protocols are paying off. While we are pleased with these results, US credit market share continues to require attention and focus. The good news is we have a detailed plan to address it, which is embedded in our 3-year targets. Slides 6 and 7 highlight how well we are executing on our new initiatives across our three strategic channels, including strong growth continuing in our automation suite. On slide 7, in the client-initiated channel, we continue to make progress with block trading globally.
Chris Concannon: Slides 4 and 5 really drive home how well we have enhanced the market access advantage in 2025. Most of the KPIs on slide 4 show healthy growth rates, reflecting the underlying health of our franchise. This shows that in the investments we have made to enhance our products and provide clients with new workflow tools and protocols are paying off. While we are pleased with these results, US credit market share continues to require attention and focus. The good news is we have a detailed plan to address it, which is embedded in our 3-year targets. Slides 6 and 7 highlight how well we are executing on our new initiatives across our three strategic channels, including strong growth continuing in our automation suite. On slide 7, in the client-initiated channel, we continue to make progress with block trading globally.
Speaker #3: Most of the KPIs on slide four show healthy growth rates reflecting the underlying health of our franchise. This shows that the investments we have made to enhance our products and provide clients with new workflow tools and protocols are paying off.
Speaker #3: While we are pleased with these results, U.S. credit market share continues to require attention and focus. The good news is we have a detailed plan to address it, which is embedded in our three-year targets.
Speaker #3: Slides six and seven highlight how well we are executing initiatives across our three strategic channels, including strong growth continuing in our automation suite.
Speaker #3: On slide seven, in the client-initiated channel, we continue to make progress with block trading globally. Our block solutions continue to grow in U.S. credit, emerging markets, and Eurobonds, proving that blocks will move from phone to platform.
Chris Concannon: Our block solutions continue to grow in US credit, emerging markets, and Eurobonds, proving that blocks will move from phone to platform. We also recently launched a new axe trading solution for dealers to send axes directly to specific clients. The rollout is in progress, and the client feedback has been positive. We generated 24% growth in ADV to a record $5 billion of block activity across US credit, emerging markets, and Eurobonds, with record block trading ADV across all three products. Our US credit ADV record was driven by record block trading ADV in US high grade of over $2 billion, which represented an 18% increase. Our ADV record in US high yield of over $800 million in block trading represented an increase of 19%. The strong growth continued in January, with a 56% increase in block trading ADV last month.
Chris Concannon: Our block solutions continue to grow in US credit, emerging markets, and Eurobonds, proving that blocks will move from phone to platform. We also recently launched a new axe trading solution for dealers to send axes directly to specific clients. The rollout is in progress, and the client feedback has been positive. We generated 24% growth in ADV to a record $5 billion of block activity across US credit, emerging markets, and Eurobonds, with record block trading ADV across all three products. Our US credit ADV record was driven by record block trading ADV in US high grade of over $2 billion, which represented an 18% increase. Our ADV record in US high yield of over $800 million in block trading represented an increase of 19%. The strong growth continued in January, with a 56% increase in block trading ADV last month.
Speaker #3: We also recently launched a new Axe trading solution for dealers to send Axes directly to specific clients. The rollout is in progress, and the client feedback has been positive.
Speaker #3: We generated $24% growth in ADV to a record $5 billion of block activity across U.S. credit, emerging markets, and Eurobonds, with record block trading ADV across all three products.
Speaker #3: Our U.S. credit ADV record was driven by record block trading ADV in U.S. high-grade of over $2 billion, which represented an 18% increase. Our ADV record in U.S.
Speaker #3: $800 million in block trading high-yield of over represented an increase of 19%. The strong growth continued in January, with a 56% increase in block trading ADV last month.
Speaker #3: Block trading in U.S. credit, emerging markets, and Eurobonds now makes up about a third of our credit ADV and represents the next step in the growth of electronic trading.
Chris Concannon: Block trading in US credit, emerging markets, and Eurobonds now makes up about 1/3 of our credit ADV and represents the next step in the growth of electronic trading. In the portfolio trading channel, we generated a 48% increase in total global portfolio trading ADV to a record $1.4 billion, with record US credit ADV and market share. US credit portfolio trading market share increased by 270 basis points in 2025. In January 2026, total portfolio trading ADV was up 126%, and market share in US credit portfolio trading increased by 620 basis points.
Chris Concannon: Block trading in US credit, emerging markets, and Eurobonds now makes up about 1/3 of our credit ADV and represents the next step in the growth of electronic trading. In the portfolio trading channel, we generated a 48% increase in total global portfolio trading ADV to a record $1.4 billion, with record US credit ADV and market share. US credit portfolio trading market share increased by 270 basis points in 2025. In January 2026, total portfolio trading ADV was up 126%, and market share in US credit portfolio trading increased by 620 basis points.
Speaker #3: In the portfolio trading channel, we generated a 48% increase in total global portfolio trading ADV to a billion. With record U.S. credit record $1.4 share.
Speaker #3: U.S. credit portfolio trading market share increased by 2025. In January, $270 basis points in 2026, total portfolio trading ADV was up $126%, and market share in U.S.
Speaker #3: Credit portfolio trading increased by 620 basis points. In the dealer-initiated channel, we generated a 33% increase in dealer-initiated ADV for the year, and we exited 2025 with a strong contribution from our new U.S.
Chris Concannon: In the dealer-initiated channel, we generated a 33% increase in dealer-initiated ADV for the year, and we exited 2025 with a strong contribution from our new US credit Middex protocol, with over $3 billion in trading volume in December alone. Again, this strong growth continued into January, with a 13% increase in our dealer-initiated ADV. Total Middex trading volume was a record $7 billion, representing an increase of 383%. Last, in the automation suite, we had another strong year as clients continued to leverage automation, enabling them to do more with less. Additionally, we were very pleased to see a significant increase in adaptive Auto-X algo trading volume in Q4. Several key clients adopted more customized adaptive algo workflows to increase execution performance and generated over $8 billion in trading volume in Q4.
Chris Concannon: In the dealer-initiated channel, we generated a 33% increase in dealer-initiated ADV for the year, and we exited 2025 with a strong contribution from our new US credit Middex protocol, with over $3 billion in trading volume in December alone. Again, this strong growth continued into January, with a 13% increase in our dealer-initiated ADV. Total Middex trading volume was a record $7 billion, representing an increase of 383%. Last, in the automation suite, we had another strong year as clients continued to leverage automation, enabling them to do more with less. Additionally, we were very pleased to see a significant increase in adaptive Auto-X algo trading volume in Q4. Several key clients adopted more customized adaptive algo workflows to increase execution performance and generated over $8 billion in trading volume in Q4.
Speaker #3: credit MIDX protocol, with over $3 billion in trading volume in December alone. Again, this strong growth continued into January, with a 13% increase in our dealer-initiated ADV.
Speaker #3: Total MIDX trading volume was a record $7 billion, representing an increase of 383%. Last, in the automation suite, we had another strong year as clients are enabling themselves to do more with less.
Speaker #3: Additionally, we were very pleased to see a significant increase in adaptive AutoX Algo trading volume in the fourth quarter. Several key clients adopted more customized adaptive Algo workflows to increase execution performance and generated over $8 billion in trading volume in the fourth quarter.
Speaker #3: I'm also happy to report that our Pragma acquisition, which is powering our recent algo success, is fully accretive while also adding strategic value across our matching and automation technology modernization, including driving growth in our rates complex.
Chris Concannon: I'm also happy to report that our Pragma acquisition, which is powering our recent algo success, is fully accretive, while also adding strategic value across our matching and automation technology modernization, including driving growth in our rates complex. Slide eight shows the strong growth of our new initiatives with our top 25 clients. Our top 25 clients have been driving our growth in portfolio trading, with an 85% increase in PT volume coming from the top 25. While our top 25 clients have been leveraging our platform for portfolio trading, they've also been leveraging our automation suite for block trading. Automated block trading volume from our top 25 is up over 125%. Not surprisingly, given the benefits of XPro in managing RFQ and portfolio trades with our rich proprietary pre-trade analytics and data, trading volume through XPro is also up 80%.
Chris Concannon: I'm also happy to report that our Pragma acquisition, which is powering our recent algo success, is fully accretive, while also adding strategic value across our matching and automation technology modernization, including driving growth in our rates complex. Slide eight shows the strong growth of our new initiatives with our top 25 clients. Our top 25 clients have been driving our growth in portfolio trading, with an 85% increase in PT volume coming from the top 25. While our top 25 clients have been leveraging our platform for portfolio trading, they've also been leveraging our automation suite for block trading. Automated block trading volume from our top 25 is up over 125%. Not surprisingly, given the benefits of XPro in managing RFQ and portfolio trades with our rich proprietary pre-trade analytics and data, trading volume through XPro is also up 80%.
Speaker #3: our new initiatives with our top 25 clients have been driving our 25 clients. growth in portfolio trading with an 85% increase Our top in PT volume coming from the top 25.
Speaker #3: While our top 25 clients have been leveraging our platform for portfolio, slide eight shows the strong growth of trading. They've also been leveraging our automation suite for block. From our top 25, block trading is up.
Speaker #3: Automated block trading volume over $125%. And not surprisingly, given the benefits of Expro in managing RFQ and portfolio trades with our rich proprietary pre-trade analytics and data, trading volume through Expro is also up 80%.
Chris Concannon: Slide nine highlights the increase in market share in US high-yield portfolio trading in the second half of 2025 as a result of several enhancements we made last year. The enhancements allow clients to better evaluate the pricing they receive for their high-yield portfolios. While this chart highlights the dramatic increase in estimated US high-yield PT market share, we have also seen our traditional RFQ high-yield market share increase by approximately 100 basis points in the second half of 2025. Slide ten highlights the increase in the long-term e-trading opportunity that we have seen in just the last several years. This is a point worth emphasizing that I believe many market followers have been missing, particularly with our recent growth in blocks.
Chris Concannon: Slide nine highlights the increase in market share in US high-yield portfolio trading in the second half of 2025 as a result of several enhancements we made last year. The enhancements allow clients to better evaluate the pricing they receive for their high-yield portfolios. While this chart highlights the dramatic increase in estimated US high-yield PT market share, we have also seen our traditional RFQ high-yield market share increase by approximately 100 basis points in the second half of 2025. Slide ten highlights the increase in the long-term e-trading opportunity that we have seen in just the last several years. This is a point worth emphasizing that I believe many market followers have been missing, particularly with our recent growth in blocks.
Speaker #3: The increase in market share—slide nine highlights—in U.S. high-yield portfolio trading in the second half of 2025 is a result of several enhancements we made last year.
Speaker #3: The enhancements allow clients to better evaluate the pricing they receive for their highlights the dramatic increase in estimated U.S. high-yield PT market share, we have also seen our traditional RFQ high-yield market share increase by approximately 100 basis points in the second half of 2025.
Speaker #3: Slide 10 highlights the increase in the long-term e-trading opportunity that we have seen in just the last several years. This is a point worth emphasizing that I believe many market followers have been missing.
Speaker #3: Particularly with our recent growth in blocks. While total electronification percentage rates may have plateaued in U.S. credit over the last year, the U.S. high-grade market overall has increased by approximately 52%, and U.S.
Chris Concannon: While total electronification percentage rates may have plateaued in US credit over the last year, the US high-grade market overall has increased by approximately 52%, and US high yield has grown by approximately 28%. We believe that we are well-positioned to capture this expanding e-trading opportunity as a result of the new initiatives that we have in the market right now, as well as the ones we plan to deliver in 2026. ... This is why we feel good about our position and our ability to return to higher levels of revenue growth in the coming quarters. Now, let me turn the call over to Ilene to review our financial performance.
Chris Concannon: While total electronification percentage rates may have plateaued in US credit over the last year, the US high-grade market overall has increased by approximately 52%, and US high yield has grown by approximately 28%. We believe that we are well-positioned to capture this expanding e-trading opportunity as a result of the new initiatives that we have in the market right now, as well as the ones we plan to deliver in 2026. ... This is why we feel good about our position and our ability to return to higher levels of revenue growth in the coming quarters. Now, let me turn the call over to Ilene to review our financial performance.
Speaker #3: high-yield has grown by approximately 28%. We believe that we are well positioned to capture this expanding e-trading opportunity as a result of the new initiatives that we have in the market right now, as well as the ones we plan to deliver in 2026.
Speaker #3: This is why we feel good about our position and our ability to return to higher levels of revenue growth in the coming quarters. Now, let me turn the call over to Ilene to
Speaker #2: you, Chris. Turning to our results on slide 12, we provide a summary of our fourth quarter financials. We delivered three and a half percent revenue growth to $209 million which includes a $2 million benefit from foreign currency translation.
Ilene Fiszel Bieler: Thank you, Chris. Turning to our results, on slide 12, we provide a summary of our Q4 financials. We delivered 3.5% revenue growth to $209 million, which includes a $2 million benefit from foreign currency translation. We reported diluted earnings per share of $2.51, or $1.68 per share, excluding notable items. The net $0.83 per share impact of notable items in the quarter consisted of approximately $1 million, or $0.02 per share, in repositioning charges in our expenses in the employee compensation and benefits line, and $31 million, or $0.85 per share, for reserve release related to the tax-related reserve we established in Q1 2025.
Ilene Fiszel Bieler: Thank you, Chris. Turning to our results, on slide 12, we provide a summary of our Q4 financials. We delivered 3.5% revenue growth to $209 million, which includes a $2 million benefit from foreign currency translation. We reported diluted earnings per share of $2.51, or $1.68 per share, excluding notable items. The net $0.83 per share impact of notable items in the quarter consisted of approximately $1 million, or $0.02 per share, in repositioning charges in our expenses in the employee compensation and benefits line, and $31 million, or $0.85 per share, for reserve release related to the tax-related reserve we established in Q1 2025.
Speaker #2: We reported diluted earnings per share of $2.51, or $1.68 per share excluding notable items. The net 83 cents per share impact of notable items in the quarter consisted of approximately $1 million, or 2 cents per share, in repositioning charges and other expenses in the employee compensation and benefits line, and $31 million, or 85 cents per share, for reserve release related to the tax-related reserve we established in the first quarter of 2025.
Speaker #2: My comments on our results from this point forward will largely exclude the impact of notable items, and will be on a non-GAAP basis where applicable.
Ilene Fiszel Bieler: My comments on our results from this point forward will largely exclude the impact of notable items and will be on a non-GAAP basis, where applicable. Looking at each of our revenue lines in turn, total commissions revenue increased 4% to $181 million compared to the prior year. Services revenue increased 2% to $28 million. Information services revenue of $13 million increased 2%. Post-trade services revenue of $11 million increased 1% versus the prior year. Technology services revenue of $4 million increased 2%, driven by higher license fees as well as connectivity fees from RFQ Hub. Total other income decreased approximately $1 million, driven by lower investment income on lower rates and increased interest expense related to borrowings for the ASR, partially offset by unrealized investment gains in the quarter.
Ilene Fiszel Bieler: My comments on our results from this point forward will largely exclude the impact of notable items and will be on a non-GAAP basis, where applicable. Looking at each of our revenue lines in turn, total commissions revenue increased 4% to $181 million compared to the prior year. Services revenue increased 2% to $28 million. Information services revenue of $13 million increased 2%. Post-trade services revenue of $11 million increased 1% versus the prior year. Technology services revenue of $4 million increased 2%, driven by higher license fees as well as connectivity fees from RFQ Hub. Total other income decreased approximately $1 million, driven by lower investment income on lower rates and increased interest expense related to borrowings for the ASR, partially offset by unrealized investment gains in the quarter.
Speaker #2: Looking at each of our revenue lines in turn, total commissions revenue increased 4% to $181 million compared to the prior year. Services revenue increased 2% to $28 million.
Speaker #2: Information services revenue of $13 million increased 2%. Post-trade services revenue of $11 million increased 1% versus the prior year. Technology services revenue of $4 million increased 2%, driven by higher license fees as well as connectivity fees from RFQ hub.
Speaker #2: Total other income decreased approximately $1 million, driven by lower investment income on lower rates and increased interest expense related to borrowings for the ASR.
Speaker #2: Partially offset by unrealized investment gains in the quarter. The effective tax rate was a negative 15.8%, or a positive 23.4% excluding the impact of the tax-related notable I referenced earlier.
Ilene Fiszel Bieler: The effective tax rate was a -15.8%, or a +23.4%, excluding the impact of the tax-related notable I referenced earlier. On slide 13, we provide more detail on our commission revenue and our fee capture. Total credit commission revenue of $165 million increased 2% compared to the prior year. 4% growth in US high-yield, 6% growth in emerging markets, and 9% growth in Eurobonds. Total commission revenue was partially offset by a 1% decline in US high grade and a 14% decline in municipals. We are very pleased with the improvement in US high-yield revenue generation at the end of 2025.
Ilene Fiszel Bieler: The effective tax rate was a -15.8%, or a +23.4%, excluding the impact of the tax-related notable I referenced earlier. On slide 13, we provide more detail on our commission revenue and our fee capture. Total credit commission revenue of $165 million increased 2% compared to the prior year. 4% growth in US high-yield, 6% growth in emerging markets, and 9% growth in Eurobonds. Total commission revenue was partially offset by a 1% decline in US high grade and a 14% decline in municipals. We are very pleased with the improvement in US high-yield revenue generation at the end of 2025.
Speaker #2: On slide 13, we provide more detail on our commission revenue and our fee capture. Total credit commission revenue of $165 million increased 2% compared to the prior year.
Speaker #2: 4% growth in U.S. high yield, 6% growth in emerging markets, and 9% growth in Eurobonds total commission revenue was partially offset by a 1% decline in U.S.
Speaker #2: High grade and a 14% decline in municipals. We were very pleased with the improvement in U.S. high yield revenue generation at the end of 2025.
Speaker #2: The reduction in total credit fee capture, both year over year and quarter over quarter, was principally due to protocol mix, partially offset by the higher duration of bonds traded in the U.S.
Ilene Fiszel Bieler: The reduction in total credit fee capture, both year-over-year and quarter-over-quarter, was principally due to protocol mix, partially offset by the higher duration of bonds traded in US high grade. On slide 14, we provide a summary of our operating expenses. Excluding notable items, total expenses increased 8%, which included a headwind of $1 million due to the impact of foreign currency translation. The increase was driven principally by higher consulting, technology and communications, and employee compensation costs. As we continue to invest in our technology modernization and upgrade talent to drive future growth, we are continuing to invest, while at the same time, looking for cost efficiencies. Headcount was 869, down 2% from 891 in the prior year period, and down 3% from Q3 of 2025.
Ilene Fiszel Bieler: The reduction in total credit fee capture, both year-over-year and quarter-over-quarter, was principally due to protocol mix, partially offset by the higher duration of bonds traded in US high grade. On slide 14, we provide a summary of our operating expenses. Excluding notable items, total expenses increased 8%, which included a headwind of $1 million due to the impact of foreign currency translation. The increase was driven principally by higher consulting, technology and communications, and employee compensation costs. As we continue to invest in our technology modernization and upgrade talent to drive future growth, we are continuing to invest, while at the same time, looking for cost efficiencies. Headcount was 869, down 2% from 891 in the prior year period, and down 3% from Q3 of 2025.
Speaker #2: On slide 14, we provide a summary of our operating expenses. Excluding notable items, total expenses increased 8%, which included a headwind of $1 million due to the impact of foreign currency translation.
Speaker #2: The increase was driven principally by higher consulting, technology and communications, and employee compensation costs, as we continue to invest in our technology modernization and upgrade talent to drive future growth.
Speaker #2: We are continuing to invest while at the same time looking for cost efficiencies. Headcount was 869, down 2% from 891 in the prior year period, and down 3% from the third quarter of 2025.
Speaker #2: On slide 15, we provide an update on our capital management and cash flow. Our balance sheet continues to be strong, with cash, cash equivalents, and corporate bond and U.S.
Ilene Fiszel Bieler: On slide 15, we provide an update on our capital management and cash flow. Our balance sheet continues to be strong, with cash, cash equivalents, and corporate bond and US Treasury investments totaling $679 million as of 31 December 2025. We generated a record $347 million in free cash flow in 2025, and we returned a total of $474 million to investors through share repurchases and dividends during the year. We repurchased 2 million shares for a total of $360 million in 2025, including 595,000 shares in open market repurchases for $120 million, and approximately 1.4 million shares for $240 million, with the commencement of our $300 million ASR in December of last year.
Ilene Fiszel Bieler: On slide 15, we provide an update on our capital management and cash flow. Our balance sheet continues to be strong, with cash, cash equivalents, and corporate bond and US Treasury investments totaling $679 million as of 31 December 2025. We generated a record $347 million in free cash flow in 2025, and we returned a total of $474 million to investors through share repurchases and dividends during the year. We repurchased 2 million shares for a total of $360 million in 2025, including 595,000 shares in open market repurchases for $120 million, and approximately 1.4 million shares for $240 million, with the commencement of our $300 million ASR in December of last year.
Speaker #2: Treasury investments totaled $679 million as of December 31, 2025. We generated a record $347 million in free cash flow in 2025, and we returned a total of $474 million to investors through share repurchase and dividends during the year.
Speaker #2: We repurchased 2 million shares for a total of $360 million in 2025, including 595,000 shares in open market repurchases for $120 million, and approximately 1.4 million shares for $240 million, with the commencement of our $300 million ASR in December of last year.
Speaker #2: I'm pleased to report that we just completed the ASR earlier this week with a final delivery of an additional 360,000 shares, bringing the total shares repurchased through the ASR to 1.7 million.
Ilene Fiszel Bieler: I'm pleased to report that we just completed the ASR earlier this week, with the final delivery of an additional 360,000 shares, bringing the total shares repurchased through the ASR to 1.7 million. As of 31 January 2026, $205 million remains on the board's share repurchase authorization. On slide 16 is our full year 2026 guidance. Before I move to guidance for 2026, please note that for 2025, total revenue outside of US credit grew 10%, and US credit revenue decreased 2%. Now, in terms of guidance for 2026, total services revenue, which includes information, post-trade, and technology services, is expected to grow in the mid-single-digit percent in 2026. We expect total expenses, ex notables, to be in the range of $530 million to $545 million.
Ilene Fiszel Bieler: I'm pleased to report that we just completed the ASR earlier this week, with the final delivery of an additional 360,000 shares, bringing the total shares repurchased through the ASR to 1.7 million. As of 31 January 2026, $205 million remains on the board's share repurchase authorization. On slide 16 is our full year 2026 guidance. Before I move to guidance for 2026, please note that for 2025, total revenue outside of US credit grew 10%, and US credit revenue decreased 2%. Now, in terms of guidance for 2026, total services revenue, which includes information, post-trade, and technology services, is expected to grow in the mid-single-digit percent in 2026. We expect total expenses, ex notables, to be in the range of $530 million to $545 million.
Speaker #2: As of January 31, 2026, $205 million remains on the board's share repurchase authorization. On slide 16 is our full year 2026 guidance. Before I move to guidance for 2026, please note that for 2025, total revenue outside of U.S.
Speaker #2: Credit grew 10%, and U.S. credit revenue decreased 2%. Now, in terms of guidance for 2026, total services revenue, which includes information, post-trade, and technology services, is expected to grow in the mid-single digits percent in 2026.
Speaker #2: We expect total expenses, excluding notables, to be in the range of $530 million to $545 million. This would imply a growth rate of approximately 8% to the midpoint of the 2026 range.
Ilene Fiszel Bieler: This would imply a growth rate of approximately 8% to the midpoint of the 2026 range. This includes the full year effect of 2025 hires, inflationary increases, as well as tech investments and higher variable costs. A note on our full year 2026 expense guidance relative to our average annual operating margin expansion target. As I have stated previously, our three-year average annual targets of 8% to 9% revenue growth and operating margin expansion of 75 to 125 basis points are exactly that, averages over three years. Turning to taxes, we expect that the effective tax rate will be in the range of 24% to 26%.
Ilene Fiszel Bieler: This would imply a growth rate of approximately 8% to the midpoint of the 2026 range. This includes the full year effect of 2025 hires, inflationary increases, as well as tech investments and higher variable costs. A note on our full year 2026 expense guidance relative to our average annual operating margin expansion target. As I have stated previously, our three-year average annual targets of 8% to 9% revenue growth and operating margin expansion of 75 to 125 basis points are exactly that, averages over three years. Turning to taxes, we expect that the effective tax rate will be in the range of 24% to 26%.
Speaker #2: This includes the full year effect of 2025 hires, inflationary increases, as well as tech investments, and higher variable costs. A note on our full year 2026 expense guidance relative to our target.
Speaker #2: As I have stated previously, our three-year average annual targets of 8% to 9% revenue growth and operating margin expansion of 75 to 125 basis points are exactly that.
Speaker #2: Averages over three years. Turning to taxes, we expect that the effective tax rate will be in the range of 24% to 26%. Capital expenditures are expected in the range of $65 million to $75 million, of which roughly 80% relates to capitalized software development costs for investments we are making in new protocols and trading platform enhancements.
Ilene Fiszel Bieler: Capital expenditures are expected in the range of $65 million to 75 million, of which roughly 80% relates to capitalized software development costs for investments we are making in new protocols and trading platform enhancements. Now, let me turn this call back to Chris for his closing comments.
Ilene Fiszel Bieler: Capital expenditures are expected in the range of $65 million to 75 million, of which roughly 80% relates to capitalized software development costs for investments we are making in new protocols and trading platform enhancements. Now, let me turn this call back to Chris for his closing comments.
Speaker #2: Now, let me turn the call back to Chris for his closing comments.
Speaker #3: Thanks, Eileen. In summary, on slide 17, we are continuing to execute our long-term strategy. We have significantly enhanced the market access advantage with our investments over the last several years.
Chris Concannon: ... Thanks, Ilene. In summary, on slide 17, we are continuing to execute our long-term strategy. We have significantly enhanced the market access advantage with our investments over the last several years. The growth profile of the company outside US credit is strong, and we are confident in our ability to return to higher levels of revenue growth in US credit with our three-year financial targets. We continue to make strong progress with our new initiatives across our three strategic channels. We are confident in our ability to execute in 2026, and we are continuing to focus on expense discipline and optimizing capital deployment to maximize long-term shareholder value. Now, we'd be happy to open the line for your questions.
Chris Concannon: ... Thanks, Ilene. In summary, on slide 17, we are continuing to execute our long-term strategy. We have significantly enhanced the market access advantage with our investments over the last several years. The growth profile of the company outside US credit is strong, and we are confident in our ability to return to higher levels of revenue growth in US credit with our three-year financial targets. We continue to make strong progress with our new initiatives across our three strategic channels. We are confident in our ability to execute in 2026, and we are continuing to focus on expense discipline and optimizing capital deployment to maximize long-term shareholder value. Now, we'd be happy to open the line for your questions.
Speaker #3: The growth profile of the company outside U.S. credit is strong, and we are confident in our ability to return to higher levels of revenue growth in the U.S.
Speaker #3: Credit, with our three-year financial targets. We continue to make strong progress with our new initiatives across our three strategic channels. We are confident in our ability to execute in 2026, and we are continuing to focus on expense discipline and optimizing capital deployment to maximize long-term shareholder value.
Speaker #3: we'd be happy to open the line for your Now, questions.
Operator: We will now begin the question-and-answer session. In order to ask a question, simply press star, followed by the number 1 on your telephone keypad. Our first question will come from the line of Patrick Moley with Piper Sandler. Please go ahead.
Operator: We will now begin the question-and-answer session. In order to ask a question, simply press star, followed by the number 1 on your telephone keypad. Our first question will come from the line of Patrick Moley with Piper Sandler. Please go ahead.
Speaker #1: question, simply press star followed by We will now begin the question and answer session. In order to ask a the number one on your telephone keypad.
Speaker #1: Our first question will come from the line of Patrick Moley with Piper Sandler. Please go ahead.
Speaker #4: Yes, good morning. I wanted to ask about block trading, Chris. You noted in your prepared remarks the strength you've seen there—up 24% last year, and then up 56% year-over-year in January.
Patrick Moley: Yes, good morning. Wanted to ask about block trading. Chris, you noted in your prepared remarks the strength you've seen there, up 24% last year, and then up 56% year-over-year in January. So could you break down the strength that you're seeing there, where it's coming from, and the different ways that you're attacking that market? Just trying to get a better sense for what's going on behind the scenes there. Thanks.
Patrick Moley: Yes, good morning. Wanted to ask about block trading. Chris, you noted in your prepared remarks the strength you've seen there, up 24% last year, and then up 56% year-over-year in January. So could you break down the strength that you're seeing there, where it's coming from, and the different ways that you're attacking that market? Just trying to get a better sense for what's going on behind the scenes there. Thanks.
Speaker #4: So could you break down the strength that you're seeing there, where it's coming from, and the different ways that you're attacking that market, just trying to get a better sense for what's going on behind the scenes there?
Speaker #4: Thanks.
Speaker #3: Sure.
Chris Concannon: Sure, and thanks, Patrick, for that question. Obviously, we've been investing in our key initiatives, all our new initiatives, portfolio trading, dealer initiatives, and then blocks as part of the larger initiatives. We're seeing returns across all three, so it's quite exciting. The block volumes that we're seeing are quite substantial. So I'll just run through some of the stats and then get back to your question around where we're seeing blocks come through the platform. First of all, in 2025, you heard it in my prepared remarks, we've seen growth of block trading on the platform in IG of 18% and high yield of 19%. And then, key areas where we first started to deploy our block protocols, EM is up 27% and Euros up a staggering 66%.
Chris Concannon: Sure, and thanks, Patrick, for that question. Obviously, we've been investing in our key initiatives, all our new initiatives, portfolio trading, dealer initiatives, and then blocks as part of the larger initiatives. We're seeing returns across all three, so it's quite exciting. The block volumes that we're seeing are quite substantial. So I'll just run through some of the stats and then get back to your question around where we're seeing blocks come through the platform. First of all, in 2025, you heard it in my prepared remarks, we've seen growth of block trading on the platform in IG of 18% and high yield of 19%. And then, key areas where we first started to deploy our block protocols, EM is up 27% and Euros up a staggering 66%.
Speaker #3: And thanks, Patrick, for that question. Obviously, we've been investing in our key initiatives—all our new initiatives, portfolio trading, dealer initiatives, and then blocks as part of the larger initiatives.
Speaker #3: We're seeing returns across all three, so it's quite exciting. The block volumes that we're seeing are quite substantial. So I'll just run through some of the stats and then get back to your question around where we're seeing blocks come through the platform.
Speaker #3: First of all, in 2025, you heard it in my prepared remarks, we've seen growth of block trading on the platform in IG of 18% and high yield of 19%.
Speaker #3: And then key areas where we first started to deploy our block protocols: EM is up 27%, and Euros up a staggering 66%. So the good news is, the block opportunity is there, and the tools we're deploying are increasing our share of blocks on the market.
Chris Concannon: So we, the good news is the block opportunity is there, and the tools we're deploying are increasing our share of blocks, on the market. Again, Q4, as you mentioned, a 24% increase, a total of $5 billion in block volume across the platform. And then here in January, still increasing our overall block volume. I'm happy to report 1/3 of our credit volume is now in blocks, during the month of January. And, you know, in January, high grade was up 33%, high yield up 42%, and EM up 92%, with Euros up 89%. So all sizable growth numbers across the block platform. We have a number of protocols that are seeing block volume pass through it.
Chris Concannon: So we, the good news is the block opportunity is there, and the tools we're deploying are increasing our share of blocks, on the market. Again, Q4, as you mentioned, a 24% increase, a total of $5 billion in block volume across the platform. And then here in January, still increasing our overall block volume. I'm happy to report 1/3 of our credit volume is now in blocks, during the month of January. And, you know, in January, high grade was up 33%, high yield up 42%, and EM up 92%, with Euros up 89%. So all sizable growth numbers across the block platform. We have a number of protocols that are seeing block volume pass through it.
Speaker #3: Again, Q4, as you mentioned, a 24% increase; a total of $5 billion in block volume across the platform. And then here in January, still increasing our overall block volume.
Speaker #3: I'm happy to report a third of our credit volume is now in blocks during the month of January. And in January, high grade was up 33%, high yield up 42%, and EM up 92%, with Euros up 89%.
Speaker #3: So all sizable growth numbers across the block platform. We have a number of protocols that are seeing block volume pass through it. Obviously, the data is a key ingredient to our success in block.
Chris Concannon: Obviously, the data is a key ingredient to our success in block. We are now able to price blocks based on their size and their direction, and that's a key feature that clients are asking us more and more about. Our targeted RFQ, which was launched in EM and Euros, is where we're seeing the strongest growth rates in our block growth rates. And then we are seeing traditional RFQ, all-to-all RFQ; we are seeing blocks come through the platform there. It's just the liquidity levels are quite high. The market impact of sharing your block with all participants is quite reduced. And then the other areas, other exciting areas that we're seeing block content, is in our automation solution.
Chris Concannon: Obviously, the data is a key ingredient to our success in block. We are now able to price blocks based on their size and their direction, and that's a key feature that clients are asking us more and more about. Our targeted RFQ, which was launched in EM and Euros, is where we're seeing the strongest growth rates in our block growth rates. And then we are seeing traditional RFQ, all-to-all RFQ; we are seeing blocks come through the platform there. It's just the liquidity levels are quite high. The market impact of sharing your block with all participants is quite reduced. And then the other areas, other exciting areas that we're seeing block content, is in our automation solution.
Speaker #3: We are now able to price blocks. Based on their size and their direction, and that's a key feature that clients are asking us more and more about.
Speaker #3: Our targeted RFQ, which was launched in EM and Euros, is where we're seeing the strongest growth rates. In our block growth rates, and then we are seeing traditional RFQ all to all RFQ.
Speaker #3: We are seeing blocks come through the platform there. It's just that the liquidity levels are quite high. The market impact of sharing your block with all participants is quite reduced.
Speaker #3: And then the other areas of other exciting areas that we're seeing block content is in our automation solution. We're seeing very large institutional investors increase their size of block activity through automation.
Chris Concannon: We're seeing very large institutional investors increase their size of block activity through automation. So there's no human involved. It's just a large block going through our Auto-X platform. And then we're seeing blocks in our algo suite, which is really designed for block solutions, and we're seeing a pickup in blocks there. We've also seen block size in our newly launched Mid-X solution, which was just launched in Q4 of last year. And then we're seeing block sizes come through our newly launched auctions, Closing Auction platform there. That is designed for block size as well. So we have a number of protocols, some specifically designed to compete with IV chat and phone, and others where we're just seeing an increase and an appetite for putting blocks over the platform.
Chris Concannon: We're seeing very large institutional investors increase their size of block activity through automation. So there's no human involved. It's just a large block going through our Auto-X platform. And then we're seeing blocks in our algo suite, which is really designed for block solutions, and we're seeing a pickup in blocks there. We've also seen block size in our newly launched Mid-X solution, which was just launched in Q4 of last year. And then we're seeing block sizes come through our newly launched auctions, Closing Auction platform there. That is designed for block size as well. So we have a number of protocols, some specifically designed to compete with IV chat and phone, and others where we're just seeing an increase and an appetite for putting blocks over the platform.
Speaker #3: So there's no human involved. It's just a large block going through our autoX platform. And then we're seeing blocks in our Algo suite, which is really designed for block solutions.
Speaker #3: And we're seeing a pickup in blocks there. We've also seen block size in our newly launched MIDX solution. Which was just launched in the fourth quarter of last year.
Speaker #3: And then we're seeing block sizes come through our newly launched. Auctions closing auction platform there. That is designed for block size as well. So we have a number of protocols.
Speaker #3: Some specifically designed to compete with IB chat and phone. And others where we're just seeing an increase and an appetite for putting blocks over the platform.
Speaker #3: The other piece of the market that we're seeing higher levels of block was around new issue. So the block market in the new issue market in January increased quite substantially.
Chris Concannon: The other piece of the market that we're seeing higher levels of block was around new issue. So the block market in the new issue market in January increased quite substantially. So, in order to move the overall trades volumes that we're seeing, while PT is an important protocol to, to put exposure on and off, we're seeing higher levels of block activity across the market and trying to address that activity. Thanks.
Chris Concannon: The other piece of the market that we're seeing higher levels of block was around new issue. So the block market in the new issue market in January increased quite substantially. So, in order to move the overall trades volumes that we're seeing, while PT is an important protocol to, to put exposure on and off, we're seeing higher levels of block activity across the market and trying to address that activity. Thanks.
Speaker #3: So, in order to move the overall trace volumes that we're seeing—while PT is an important protocol to put exposure on and off—we're seeing higher levels of block activity across the market and trying to address that activity.
Speaker #3: Thanks.
Speaker #4: Yep. Our next
Patrick Moley: Yep.
Patrick Moley: Yep.
Operator: Our next question will come from the line of Jeff Schmitt with William Blair. Please go ahead.
Operator: Our next question will come from the line of Jeff Schmitt with William Blair. Please go ahead.
Speaker #1: question will come from the line of Jeff Schmidt with William Blair. Please go ahead.
Speaker #5: Hi, good morning. The average fee rate in credit has obviously been sliding for the last few years, and really just from a shift in the protocol mix. Can you maybe talk about if there's competitive pricing pressures driving that as well?
Jeff Schmitt: Hi, good morning. The average fee rate in credit has obviously been sliding for the last few years and really just from a shift in the protocol mix. Can you maybe talk about, you know, if there's competitive pricing pressures driving that as well? You know, what type of decline are you assuming in the fee rate in your medium-term revenue growth outlook? Thank you.
Jeff Schmitt: Hi, good morning. The average fee rate in credit has obviously been sliding for the last few years and really just from a shift in the protocol mix. Can you maybe talk about, you know, if there's competitive pricing pressures driving that as well? You know, what type of decline are you assuming in the fee rate in your medium-term revenue growth outlook? Thank you.
Speaker #5: And what type of decline are you assuming in the fee rate in your medium-term revenue growth outlook? Thank
Speaker #5: you.
Speaker #3: Yeah, great question.
Chris Concannon: Yeah, great question. Again, there's a lot of parts that impact our Fee Per Million. Just to kind of go through some of them, so the product mix, as you mentioned, can impact our Fee Per Million. Obviously, protocol selection will definitely impact our Fee Per Million. Maturity, average maturity impacts our Fee Per Million. And then things like spread and volatility have an indirect impact on our Fee Per Million. So, a lot of moving parts around Fee Per Million. We've seen some of the largest adjustments in Fee Per Million through the protocol and product mix. A perfect example is move to Portfolio Trading, that comes in at a much lower Fee Per Million.
Chris Concannon: Yeah, great question. Again, there's a lot of parts that impact our Fee Per Million. Just to kind of go through some of them, so the product mix, as you mentioned, can impact our Fee Per Million. Obviously, protocol selection will definitely impact our Fee Per Million. Maturity, average maturity impacts our Fee Per Million. And then things like spread and volatility have an indirect impact on our Fee Per Million. So, a lot of moving parts around Fee Per Million. We've seen some of the largest adjustments in Fee Per Million through the protocol and product mix. A perfect example is move to Portfolio Trading, that comes in at a much lower Fee Per Million.
Speaker #3: Again, there are a lot of parts that impact our fee per million. Just to kind of go through some of them—so the product mix, as you mentioned, can impact our fee per million.
Speaker #3: Obviously, protocol selection will definitely impact our fee per million. Maturity, average maturity, impacts our fee per million. And then things like spread and volatility have an indirect impact on our fee per million.
Speaker #3: So a lot of moving parts around fee per million. We've seen some of the largest adjustments in fee per million through the protocol and product mix.
Speaker #3: A perfect example is the move to portfolio trading that comes in at a much lower fee per million. But again, we're all about growing our incremental revenue.
Chris Concannon: But again, it's, we're all about growing our incremental revenue, and much of the new initiatives that may come in at a lower fee per million are obviously growing revenue, incremental revenue. The areas that we have seen fee per million impact, one area in particular, we just talked about the growth in block volume, in January. Our growth in block volume does impact our fee per million, but it has a net benefit to our revenue. I'll just kind of walk you through an example so you can understand the implications of doing more volumes by block. If we trade a $50,000 order, which is quite a small size order on MarketAxess, we'll incrementally make $17 on that trade, but that comes in at a $350 fee per million.
Chris Concannon: But again, it's, we're all about growing our incremental revenue, and much of the new initiatives that may come in at a lower fee per million are obviously growing revenue, incremental revenue. The areas that we have seen fee per million impact, one area in particular, we just talked about the growth in block volume, in January. Our growth in block volume does impact our fee per million, but it has a net benefit to our revenue. I'll just kind of walk you through an example so you can understand the implications of doing more volumes by block. If we trade a $50,000 order, which is quite a small size order on MarketAxess, we'll incrementally make $17 on that trade, but that comes in at a $350 fee per million.
Speaker #3: And much of the new initiatives that may come in at a lower fee per million are obviously growing incremental revenue. The areas that we have seen fee per million impact—one area in particular, we just talked about—the growth in block volume.
Speaker #3: In January, our growth in block volume does impact our fee per million. But it has a net benefit to our revenue. I'll just kind of walk you through an example so you can understand the implications of doing more volumes by block.
Speaker #3: If we trade a quite a small size, a $50,000 order, which is ordered on MarketAxess, we'll incrementally make $17 on that trade. But that comes in at a $350 fee per million.
Chris Concannon: A $5 million block trade will make $700 on that same transaction, but that comes in at a fee per million of 140 million. So you can see that as we grow these new protocols and grow into incremental volume, it will have impacts on our fee per million calculation. And that's an important factor because we are growing all of these new initiatives, portfolio trading, block volume, and obviously automation and our dealer initiative is growing as well. All of those can have an impact on our fee per million. I'll turn it over to Ilene to round out the question.
Speaker #3: A $5 million block trade will make $700 on that same transaction. But that comes in at a fee per million of $140. So you can see that as we grow these new incremental volume, it will have impacts on our fee per million calculation.
Chris Concannon: A $5 million block trade will make $700 on that same transaction, but that comes in at a fee per million of 140 million. So you can see that as we grow these new protocols and grow into incremental volume, it will have impacts on our fee per million calculation. And that's an important factor because we are growing all of these new initiatives, portfolio trading, block volume, and obviously automation and our dealer initiative is growing as well. All of those can have an impact on our fee per million. I'll turn it over to Ilene to round out the question.
Speaker #3: And that's an important factor because we are growing all of these new initiatives. Portfolio trading, block protocols, and grow into volume, and obviously automation and our dealer initiatives is growing as well.
Speaker #3: All of those can have an impact on our fee per million. I'll turn it over to Eileen to round out the question.
Speaker #2: Yeah, let me just give a little bit of context also to support what Chris is saying. So if you think about the month-over-month January decline to $132 from $137, for instance, in fee per million, as you noted, it's volume mix shift largely into lower fee capture product as Chris just discussed.
Ilene Fiszel Bieler: Yeah, let me just give a little bit of context also, to support what Chris is saying. So if you think about the month-over-month January decline to 132 from 137, for instance, in fee per million, as you noted, it's, you know, volume mix shift largely into lower fee capture products, as Chris just discussed. But to put some more texture around it, we had a very strong month in Eurobonds with ADV up 74%, and we know Eurobonds come in at a lower capture, but we expect this, right? That's a good thing. We want to continue to see that business growing. And then also, obviously, with high-grade blocks, that ADV was up 82% on a month-over-month basis, and it really goes to what Chris was talking about before on the question on block. Now, there was a little bit of offset.
Ilene Fiszel Bieler: Yeah, let me just give a little bit of context also, to support what Chris is saying. So if you think about the month-over-month January decline to 132 from 137, for instance, in fee per million, as you noted, it's, you know, volume mix shift largely into lower fee capture products, as Chris just discussed. But to put some more texture around it, we had a very strong month in Eurobonds with ADV up 74%, and we know Eurobonds come in at a lower capture, but we expect this, right? That's a good thing. We want to continue to see that business growing. And then also, obviously, with high-grade blocks, that ADV was up 82% on a month-over-month basis, and it really goes to what Chris was talking about before on the question on block. Now, there was a little bit of offset.
Speaker #2: But to put some more texture around it, we had a very strong month in Eurobonds with ADV up 74%. And we know Eurobonds come in at a lower capture, but we expect this, right?
Speaker #2: That's a good thing. We want to continue to see that business growing. And then also, obviously, with high-grade blocks, that ADV was up 82% on a month-over-month basis.
Speaker #2: And it really goes to what Chris was talking about before on the question on blocks. Now, there was a little bit of offset. There wasn't a huge change in the weighted average years to maturity month-over-month.
Ilene Fiszel Bieler: There wasn't a huge change in the weighted average years to maturity, month-over-month. It went from about, you know, 9.47 to 9.49. So there was a little bit of offset in terms of high-grade duration there. But by and large, you can see these trends and that this is not new. This is what we've been talking about in terms of both product and protocol shift. Let me get back to you also on your medium-term target question, 'cause I, 'cause I, I understand where that's coming from, and I think it's important to take a step back when you think about the medium ter-term targets. And you've heard me say this before, I said it in my prepared remarks, right?
Ilene Fiszel Bieler: There wasn't a huge change in the weighted average years to maturity, month-over-month. It went from about, you know, 9.47 to 9.49. So there was a little bit of offset in terms of high-grade duration there. But by and large, you can see these trends and that this is not new. This is what we've been talking about in terms of both product and protocol shift. Let me get back to you also on your medium-term target question, 'cause I, 'cause I, I understand where that's coming from, and I think it's important to take a step back when you think about the medium ter-term targets. And you've heard me say this before, I said it in my prepared remarks, right?
Speaker #2: It went from about 9.47 to 9.49. So there was a little bit of offset in terms of high-grade duration there. But by and large, you can see these trends.
Speaker #2: And that this is not new. This is what we've been talking about in terms of both product and protocol shift. Let me get back to you also on your medium-term target question, because I understand where that's coming from.
Speaker #2: And I think it's important to take a step back when you think about the medium-term targets. And you've heard me say this before. I said it in my prepared remarks, right?
Speaker #2: know that the eight to nine percent average growth is just that average. And there could be some variability on phasing in over the We course of the three years.
Ilene Fiszel Bieler: We know that the 8 to 9% average growth is just that, average, and there could be some variability on phasing in over the course of the three years. Having said that, you may recall that we're being pretty clear that this is really about revenue growth and the way that we are expecting to achieve that. We think that in the first year, US credit will be about 20% of the total incremental revenue growth for the company. And then by the end of our three-year plan, we think that's going to be about 35% of incremental growth expected to come from US credit. Now, we've also have our services business, and you heard that guide today in terms of, you know, in the aggregate mid-single digits for 2026.
Ilene Fiszel Bieler: We know that the 8 to 9% average growth is just that, average, and there could be some variability on phasing in over the course of the three years. Having said that, you may recall that we're being pretty clear that this is really about revenue growth and the way that we are expecting to achieve that. We think that in the first year, US credit will be about 20% of the total incremental revenue growth for the company. And then by the end of our three-year plan, we think that's going to be about 35% of incremental growth expected to come from US credit. Now, we've also have our services business, and you heard that guide today in terms of, you know, in the aggregate mid-single digits for 2026.
Speaker #2: Having said that, you may recall that we're being pretty clear that this is really about revenue growth and the way that we are expecting to achieve that.
Speaker #2: We think that in the first year, US credit will be about 20% of the total incremental revenue growth for the company. And then by the end of our three-year plan, we think that's going to be about 35% of incremental growth expected to come from US credit.
Speaker #2: Now, we've also have our services business, and you heard that guy today in terms of in the aggregate mid-single digits for 2026. And we haven't included assumptions for increases in velocity, for instance, in these three-year targets in our three-year plans.
Ilene Fiszel Bieler: We haven't included assumptions for increases in velocity, for instance, in these three-year targets in our three-year plan. While I'm not going to give you specifics on fees per million, I can confirm that we have not baked in any fee per million accretion. Our objective, really importantly, and we keep talking about this, but just to bring it back, is that we really are looking at our ways, the levers we can use to drive revenue growth. Chris talked a lot about those initiatives, and I'm sure we're happy to go into it further, but just wanted to get back to you on that point.
Ilene Fiszel Bieler: We haven't included assumptions for increases in velocity, for instance, in these three-year targets in our three-year plan. While I'm not going to give you specifics on fees per million, I can confirm that we have not baked in any fee per million accretion. Our objective, really importantly, and we keep talking about this, but just to bring it back, is that we really are looking at our ways, the levers we can use to drive revenue growth. Chris talked a lot about those initiatives, and I'm sure we're happy to go into it further, but just wanted to get back to you on that point.
Speaker #2: I can confirm that we have not baked in any fee per million And while I'm not going to give accretion. Our objective really importantly, and we keep talking about this, but just to bring it back, is that we really are looking at our ways, the levers we can use to drive revenue growth.
Speaker #2: And Chris talked a lot about those initiatives, and I'm sure we're happy to go into it further. But just wanted to get back to you on that.
Speaker #2: point. Our next question will
Speaker #1: Okay, great. Thank you.
Jeff Schmitt: Okay, great. Thank you.
Jeff Schmitt: Okay, great. Thank you.
Operator: Our next question will come from the line of Alex Kramm with UBS. Please go ahead.
Operator: Our next question will come from the line of Alex Kramm with UBS. Please go ahead.
Speaker #4: come from the line of Alex Kram with UBS. Please go ahead.
Speaker #1: Yes, hey everyone. Can you give us a quick update on emerging markets? It seems like that's one of the biggest standout success stories for you here.
Chris Concannon: Yes. Hey, everyone. Can you give us a quick update on, on emerging markets? Seems like that's one of the biggest standout success stories for you here over the last few years. I know it's still very under-penetrated market, so maybe define really what the roadmap is, what you're excited about, maybe in 2026. Then, you know, look, obviously others are watching you, so just wondering if you see any sort of shift in competitive dynamics, if you're running into other people a little bit more, or if this is still kind of a large market for you to, to capture.
Alex Kramm: Yes. Hey, everyone. Can you give us a quick update on, on emerging markets? Seems like that's one of the biggest standout success stories for you here over the last few years. I know it's still very under-penetrated market, so maybe define really what the roadmap is, what you're excited about, maybe in 2026. Then, you know, look, obviously others are watching you, so just wondering if you see any sort of shift in competitive dynamics, if you're running into other people a little bit more, or if this is still kind of a large market for you to, to capture.
Speaker #1: Over the last few years, I know it's still a very underpenetrated market, so maybe define really what the roadmap is, what you're excited about maybe in 2026, and then, look, obviously others are watching you.
Speaker #1: So just wondering if you see any sort of shift in competitive dynamics, if you're running into other people a little bit more, or if this is still kind of a large market for you to
Speaker #1: capture. Thanks.
Ilene Fiszel Bieler: Thanks. Thanks, Alex. And, obviously, emerging markets is an exciting area for us. We're obviously just to size the market,
Ilene Fiszel Bieler: Thanks. Thanks, Alex. And, obviously, emerging markets is an exciting area for us. We're obviously just to size the market,
Speaker #3: Thanks, Alex. And obviously, emerging markets is an exciting area for us. We're obviously—just to size the market—it's similar in size to U.S. credit.
Chris Concannon: ... it's similar in size to US credit, when you talk about the global emerging market, and you have two types of markets, both, sovereign as well as corporate, local, as well as hard currency. So, it's quite a diverse market. The nice thing about that market, it is a diverse dealer market as well. It's not what I would call top-heavy. So having a diversity of dealer communities, both in the local markets and the global dealer community, is a key ingredient to the liquidity that we see over the platform. And as you mentioned, our EM, our emerging market growth has been, quite attractive over the last couple of years. It continues into January, where we saw, our EM growth, continue into January.
Chris Concannon: ... it's similar in size to US credit, when you talk about the global emerging market, and you have two types of markets, both, sovereign as well as corporate, local, as well as hard currency. So, it's quite a diverse market. The nice thing about that market, it is a diverse dealer market as well. It's not what I would call top-heavy. So having a diversity of dealer communities, both in the local markets and the global dealer community, is a key ingredient to the liquidity that we see over the platform. And as you mentioned, our EM, our emerging market growth has been, quite attractive over the last couple of years. It continues into January, where we saw, our EM growth, continue into January.
Speaker #3: When you talk about the global emerging market, you have two types of markets: both sovereign as well as corporate, local as well as hard currency.
Speaker #3: So, it's quite a diverse market. The nice thing about that market is that it is a diverse dealer market as well. It's not what I would call top-heavy.
Speaker #3: So having both in the local markets and the global dealer community, is a diversity of dealer communities a key ingredient to the liquidity that we see over the platform?
Speaker #3: And as you mentioned, our EM, our emerging market growth, has been quite attractive over the last couple of years. It continues into January. We saw our EM growth continue into January.
Speaker #3: market ADV and EM just for Our which was a record and up January was over 5 billion, 50% year over year, up 56% month over month.
Chris Concannon: Our market ADV in EM, just for January, was over $5 billion, which was a record and up 50% year-over-year, up 56% month-over-month. So you just can see that trend line is quite positive. In terms of the competitive landscape, we're not seeing, you know, we're competing dramatically with, chat and phone in the EM market. It's not a well-penetrated, electronic market. I think, you know, we try to estimate the electronic penetration in EM is somewhere under 10%, and growing. So we see that as a huge market opportunity for us.
Chris Concannon: Our market ADV in EM, just for January, was over $5 billion, which was a record and up 50% year-over-year, up 56% month-over-month. So you just can see that trend line is quite positive. In terms of the competitive landscape, we're not seeing, you know, we're competing dramatically with, chat and phone in the EM market. It's not a well-penetrated, electronic market. I think, you know, we try to estimate the electronic penetration in EM is somewhere under 10%, and growing. So we see that as a huge market opportunity for us.
Speaker #3: So you can just see that the trend line is quite positive. In terms of the competitive landscape, we're not seeing we're competing dramatically within the competitive market.
Speaker #3: It's not a well-penetrated electronic market. I think we try to chat and phone in the EM, and EM is somewhere under 10%—and growing.
Speaker #3: So, if you estimate the electronic penetration, we see that as a huge market opportunity for us. You do need people on the ground in the local markets.
Chris Concannon: You do need people on the ground in the local markets, so it is an investment in sales, an investment in regional offices, and those investments we have made for quite some time with folks in Latin America, teams in APAC and across other areas of the globe. So, exciting, a great deal of... And we mentioned earlier the block volume growth. We're seeing block volume in EM as well, helping us drive that growth. As we mentioned earlier, that was up 92% in January and up 70% month-over-month as well, setting a new record in blocks. So, a lot of exciting things to come, and we're obviously very focused on protocol solutions in EM.
Chris Concannon: You do need people on the ground in the local markets, so it is an investment in sales, an investment in regional offices, and those investments we have made for quite some time with folks in Latin America, teams in APAC and across other areas of the globe. So, exciting, a great deal of... And we mentioned earlier the block volume growth. We're seeing block volume in EM as well, helping us drive that growth. As we mentioned earlier, that was up 92% in January and up 70% month-over-month as well, setting a new record in blocks. So, a lot of exciting things to come, and we're obviously very focused on protocol solutions in EM.
Speaker #3: So, it is an investment in sales. An investment in regional offices. And those investments we have made for quite some time, with folks in Latin America, teams in APAC, and across other areas of the globe.
Speaker #3: So, exciting—a great deal of what we mentioned earlier is the block volume growth. We're seeing block volume in EM as well, helping us drive that growth as we mentioned earlier.
Speaker #3: That was up 92% in January, and up 70% month over month as well, setting a new record in blocks. So a lot of exciting things to come.
Speaker #3: And we're obviously very focused on protocol solutions in EM. That's one area where not only do we have an all-to-all RFQ, but we have an RFM as well, which is helping to drive some of our block volume growth, both in the local market as well as in the hard currency market.
Chris Concannon: That's one area where not only do we have an all-to-all RFQ, but we have a RFM as well, which is helping to drive some of our block volume growth, both in the local market as well as in the hard currency market.
Chris Concannon: That's one area where not only do we have an all-to-all RFQ, but we have a RFM as well, which is helping to drive some of our block volume growth, both in the local market as well as in the hard currency market.
Speaker #1: Very good. Thanks.
Rachel Smith: Very good. Thanks.
Alex Kramm: Very good. Thanks.
Speaker #4: Our next question will come from the line of Alex Blowstein with Goldman Sachs. Please go
Operator: Our next question will come from the line of Alex Blostein with Goldman Sachs. Please go ahead.
Operator: Our next question will come from the line of Alex Blostein with Goldman Sachs. Please go ahead.
Speaker #4: ahead. Hi, good
Alex Blostein: Hi, good morning. Thank you for taking the question. I wanted to go back to your comment around revenues outside of US credit growing. I think you said 10% in 2025. When you zoom out, and I know there's a lot of things that go in there, obviously, there are some trading businesses like non-US, but also there's recurring revenues within there as well. I think at the slide deck at our conference in December, you talked about that being, I think, like a mid-teen percent grower over time.
Alex Blostein: Hi, good morning. Thank you for taking the question. I wanted to go back to your comment around revenues outside of US credit growing. I think you said 10% in 2025. When you zoom out, and I know there's a lot of things that go in there, obviously, there are some trading businesses like non-US, but also there's recurring revenues within there as well. I think at the slide deck at our conference in December, you talked about that being, I think, like a mid-teen percent grower over time.
Speaker #5: morning. Thank you for taking the question. I wanted to go back to your comment around revenues outside of US credit, growing. I think you said 10% in 2025.
Speaker #5: When you zoom out—and I know there are a lot of things that go in there—obviously, there are some trading businesses like non-U.S., but also there's recurring revenues within there as well.
Speaker #5: I think at the slide deck at our conference in December, you talked about that being, I think, like a mid-10% grower over time. So maybe talk a little bit about what has driven sort of the slower growth last year and how do you think about the growth in that non-US trading part of the business on a multi-year basis as part of your overall revenue growth
Alex Blostein: So maybe talk a little bit about what, what has driven sort of the slower growth last year, and how do you think about the growth in that non-US trading part of the business on a multi-year basis as part of your overall revenue growth target?
Alex Blostein: So maybe talk a little bit about what, what has driven sort of the slower growth last year, and how do you think about the growth in that non-US trading part of the business on a multi-year basis as part of your overall revenue growth target?
Speaker #5: algo. Thanks for the question,
Ilene Fiszel Bieler: Thanks for the question, Alex. So yeah, of course, I know the slide you're talking about, and keeping in mind, that was a CAGR over five years, right? And so if you think about... Let's just take your services point to start and look at the full year 2025, right? Our services revenue there was about 6% this year, and we are guiding to, for 2026, mid-single-digit growth there as well. And so I think that all fits. And then you would expect to see higher revenue growth in our trading businesses outside of US credit. So this algorithm still fits, and it still is exactly as we said, if you think about the 8% to 9% average annual over time with the phase-in and variability. And I would just say that, you know, there are different levers, right?
Ilene Fiszel Bieler: Thanks for the question, Alex. So yeah, of course, I know the slide you're talking about, and keeping in mind, that was a CAGR over five years, right? And so if you think about... Let's just take your services point to start and look at the full year 2025, right? Our services revenue there was about 6% this year, and we are guiding to, for 2026, mid-single-digit growth there as well. And so I think that all fits. And then you would expect to see higher revenue growth in our trading businesses outside of US credit. So this algorithm still fits, and it still is exactly as we said, if you think about the 8% to 9% average annual over time with the phase-in and variability. And I would just say that, you know, there are different levers, right?
Speaker #6: Alex. So yeah, of course, I know the slide you're talking about, and in keeping in mind that was a Kager over five years, right?
Speaker #6: And so if you think about, let's just take your services point to start and look at the full year 2025, right? Our services revenue there was about 6% this year.
Speaker #6: And we are guiding to, for 2026, mid-single-digit growth there as well. And so I think that all fits. And then you would expect to see higher revenue growth in our trading businesses outside of US credit.
Speaker #6: So this algorithm still fits, and it still is exactly as we said. If you think about the 8% to 9% average annual over time with the phase-in and variability, I would just say that there are different levers, right?
Speaker #6: If you think about this plan, there's obviously the volume levers, and while we don't control volume needless to say in the marketplace, we know that the electronification has definitely increased velocity and Chris has certainly talked about it in the past.
Ilene Fiszel Bieler: If you think about this plan, there's obviously the volume levers, and while we don't control volume, needless to say, in the marketplace, we know that the electronification has definitely increased velocity, and Chris has certainly talked about it in the past. And if you even look at turnover in January, Alex, that was 95%. And we also, again, while we don't control volume, we also went back and we did an analysis over time, and we looked at volumes. And the only time in the last, since 2014, for instance, since volumes have contracted in this market, really was in that one post-COVID year, and we all know what 2020 was like. So we're continuing...
Ilene Fiszel Bieler: If you think about this plan, there's obviously the volume levers, and while we don't control volume, needless to say, in the marketplace, we know that the electronification has definitely increased velocity, and Chris has certainly talked about it in the past. And if you even look at turnover in January, Alex, that was 95%. And we also, again, while we don't control volume, we also went back and we did an analysis over time, and we looked at volumes. And the only time in the last, since 2014, for instance, since volumes have contracted in this market, really was in that one post-COVID year, and we all know what 2020 was like. So we're continuing...
Speaker #6: And if you even look at turnover in January, Alex, that was 95%. And we also again, while we don't control volume, we also went back and we did an analysis over time, and we looked at volumes.
Speaker #6: And the only time in the last—since 2014, for instance—since volumes have contracted in this market really was in that one post-COVID year.
Speaker #6: And we all know what 2020 was like. So we're continuing. The important thing for us, though, in terms of driving more velocity and driving turnover is making sure we have the protocols in place, the initiatives in place, that's really going. We want to be there to have the solutions there.
Ilene Fiszel Bieler: The important thing for us, though, in terms of driving more velocity and driving turnover, is making sure we have the protocols in place, the initiatives in place. That's really gonna enhance for our clients what they need. We want to be there to have the solutions there, and that goes to the market share component of the algorithm, right? When we really are looking at market share, we're looking at it as what can we do to make sure that we are protocol agnostic, and Chris has talked a lot about that. And so if you think about all of these things together, that is really what's driving the three-year plan.
Ilene Fiszel Bieler: The important thing for us, though, in terms of driving more velocity and driving turnover, is making sure we have the protocols in place, the initiatives in place. That's really gonna enhance for our clients what they need. We want to be there to have the solutions there, and that goes to the market share component of the algorithm, right? When we really are looking at market share, we're looking at it as what can we do to make sure that we are protocol agnostic, and Chris has talked a lot about that. And so if you think about all of these things together, that is really what's driving the three-year plan.
Speaker #6: And that goes to the market to enhance for our clients what they need. share component of the algorithm, right? When we really are looking at market share, we're looking at it as what can we do to make sure that we are protocol agnostic.
Speaker #6: And Chris has talked a lot about that. And so, if you think about all of these things together, that is really what's driving the three-year plan.
Speaker #6: A lot of it is really based on just sort of how do you maximize for when you're seeing volumes in the marketplace, what we're doing on the initiatives, and then obviously, the last part of that is the fee-per-million, which we talked about.
Ilene Fiszel Bieler: A lot of it is really based on just sort of how do you maximize for when you're seeing volumes in the marketplace, what we're doing on the initiatives, and then obviously the last part of that is the fee per million, which we talked about. I don't know, Chris, if you wanted to add to that.
Ilene Fiszel Bieler: A lot of it is really based on just sort of how do you maximize for when you're seeing volumes in the marketplace, what we're doing on the initiatives, and then obviously the last part of that is the fee per million, which we talked about. I don't know, Chris, if you wanted to add to that.
Speaker #6: I don't know, Chris, if you wanted to add to that.
Chris Concannon: Yeah. No, Alex, it's the right question. Look, our international business has been growing double digits for some time. That's really powered by EM and euros, where we see exciting growth. And again, in EM, still early penetration for electronic trading, so the market opportunities is quite sizable. Around the services, particularly the data business, we have historically, I've on these calls, as many times said, we will not sell some of our data. That is proving strategically correct at this point, as we see what's happening around the AI space. Keeping our data, which is proprietary, in-house, to then leverage through our own use of AI, is going to be a critical ingredient going forward.
Chris Concannon: Yeah. No, Alex, it's the right question. Look, our international business has been growing double digits for some time. That's really powered by EM and euros, where we see exciting growth. And again, in EM, still early penetration for electronic trading, so the market opportunities is quite sizable. Around the services, particularly the data business, we have historically, I've on these calls, as many times said, we will not sell some of our data. That is proving strategically correct at this point, as we see what's happening around the AI space. Keeping our data, which is proprietary, in-house, to then leverage through our own use of AI, is going to be a critical ingredient going forward.
Speaker #7: Yeah, no, Alex, it's the right question. Look, our international business has been growing double digits for some time. That's really powered by EM and euros.
Speaker #7: Where we see exciting growth—and again, in EM, still early penetration for electronic trading. So the market opportunity is quite sizable. Around the services, particularly the data business, historically I’ve, on these calls, many times said we will not sell some of our data.
Speaker #7: That is proving strategically correct at this point, as we see what's happening around the AI space. Keeping our data, which is proprietary, in-house to then leverage through our own use of AI is going to be a critical ingredient going forward.
Speaker #7: So I think when it comes to services and particularly market data revenue, we've strategically decided to keep that at a single digit number because we want to actually hold our data for our own AI uses.
Chris Concannon: So I think when it comes to services, and particularly market data revenue, we've strategically decided to keep that at a single-digit number, because we wanna actually hold our data for our own AI uses, which will actually help our transaction business. So it was a strategic decision we made, quite a number of years ago, but now it's proving to be quite valuable as we start to look at the use of AI within our dataset. Just to give you a sense of how much that data asset is growing, in 2025, we saw 5.3 trillion in inquiry volume. That's up about 13% from the prior year. That inquiry volume triggered close to 91 million in prices. So it's an increase in prices coming back.
Chris Concannon: So I think when it comes to services, and particularly market data revenue, we've strategically decided to keep that at a single-digit number, because we wanna actually hold our data for our own AI uses, which will actually help our transaction business. So it was a strategic decision we made, quite a number of years ago, but now it's proving to be quite valuable as we start to look at the use of AI within our dataset. Just to give you a sense of how much that data asset is growing, in 2025, we saw 5.3 trillion in inquiry volume. That's up about 13% from the prior year. That inquiry volume triggered close to 91 million in prices. So it's an increase in prices coming back.
Speaker #7: Which will actually help our transaction business. So it was a strategic decision we made quite a number of years ago, but now it's proving to be quite valuable as we start to look at the use of AI within our data set.
Speaker #7: Just to give you a sense of how much that data asset is growing, in 2025, we saw 5.3 trillion in inquiry volume. That's up about 13% from the prior year.
Speaker #7: That inquiry volume triggered close to $91 million in prices, so it's an increase in prices coming back. That is all unique data that is across the globe, across all the assets that we trade.
Chris Concannon: That is all unique data that is across the globe, across all the assets that we trade. And we're seeing over $35 trillion in notional prices on our platform each year. So it's quite a powerful dataset. Our choice is not to sell it all in raw form. Our choice is to leverage that data for AI purposes to create higher volumes, more sticky services around our trading businesses. So that's part of what factors into our thought process around data and data growth.
Chris Concannon: That is all unique data that is across the globe, across all the assets that we trade. And we're seeing over $35 trillion in notional prices on our platform each year. So it's quite a powerful dataset. Our choice is not to sell it all in raw form. Our choice is to leverage that data for AI purposes to create higher volumes, more sticky services around our trading businesses. So that's part of what factors into our thought process around data and data growth.
Speaker #7: And we're seeing over $35 trillion in notional prices on our platform each year. So it's quite a powerful data set. Our choice is not to sell that data or sell it all in raw form.
Speaker #7: Our choice is to leverage AI purposes to create higher volumes more sticky services around our trading businesses. So that's part of what factors into our thought process around data and data
Speaker #7: growth. Our next question will come from the
Operator: Our next question will come from the line of Ben Budish with Barclays. Please go ahead.
Operator: Our next question will come from the line of Ben Budish with Barclays. Please go ahead.
Speaker #1: Line of Ben Buddish with Barclays. Please go ahead.
Speaker #1: ahead. Good morning.
Chris O’Brien: Good morning. This is Chris O'Brien on for Ben. I just had a question about capital return. So it's been quite a strong start to the year for volumes across the industry and on platform at MarketAxess. So just curious, if we saw a continued momentum through the rest of the year, how are you guys are thinking about share repurchases as we go through 2026? Thanks.
Chris O’Brien: Good morning. This is Chris O'Brien on for Ben. I just had a question about capital return. So it's been quite a strong start to the year for volumes across the industry and on platform at MarketAxess. So just curious, if we saw a continued momentum through the rest of the year, how are you guys are thinking about share repurchases as we go through 2026? Thanks.
Speaker #8: This is Chris O'Brien on for Ben. I shared a question about capital returns. So it's been quite a strong start to the year. For volumes across the industry and on platform at market access.
Speaker #8: So just curious, if we saw continued momentum through the rest of the year, how are you guys thinking about share repurchases as we go through 2026?
Speaker #8: Thanks.
Speaker #6: Sure. Thanks for the
Ilene Fiszel Bieler: Sure. Thanks for the question. I think, as you just noted, you know, we, for us, in particular, obviously had significant capital return with our ASR and just closing it out. And I would remind everybody that we did take out of about $220 million on our revolver in order with the cash outlay, in order to put a little bit of leverage on it to do that ASR. So our first order of business is gonna be to pay that down over time. And so we do know that we have $205 million left in authorizations, and so we're just gonna see how that goes. You know, there's no end date on that authorization. So that's really how we're thinking about capital right now. And you probably also saw today that we did increase our dividend to $0.78 per share.
Ilene Fiszel Bieler: Sure. Thanks for the question. I think, as you just noted, you know, we, for us, in particular, obviously had significant capital return with our ASR and just closing it out. And I would remind everybody that we did take out of about $220 million on our revolver in order with the cash outlay, in order to put a little bit of leverage on it to do that ASR. So our first order of business is gonna be to pay that down over time. And so we do know that we have $205 million left in authorizations, and so we're just gonna see how that goes.
Speaker #6: Question. I think, as you just noted, we, for us in particular, obviously have significant capital return with our ASR and just closing it out.
Speaker #6: And I would remind everybody that we did take out about $220 million on our revolver in order, with the cash outlay, to put a little bit of leverage on it to do that ASR.
Speaker #6: So our first order of business is going to be to pay that down over time. And so we do know that we have $205 million left in authorizations.
Speaker #6: And so we're just going to see how that goes. There's no end date on that authorization, so that's really how we're thinking about capital right now.
Ilene Fiszel Bieler: You know, there's no end date on that authorization. So that's really how we're thinking about capital right now. And you probably also saw today that we did increase our dividend to $0.78 per share. So that's another thing that we're thinking about in terms of increasing capital return, at least on the dividend side, in the short term.
Speaker #6: And you probably also saw today that we did increase our dividend to $0.78 per share. So that's another thing that we're thinking about in terms of increasing capital return, at least on the dividend side in the short term.
Ilene Fiszel Bieler: So that's another thing that we're thinking about in terms of increasing capital return, at least on the dividend side, in the short term.
Speaker #6: term. Great.
Chris O’Brien: Great. Thank you.
Chris O’Brien: Great. Thank you.
Speaker #8: Thank you.
Speaker #1: Our next question will come from the line of Dan Fannin with Jefferies. Please go ahead.
Operator: Our next question will come from the line of Dan Fannon with Jefferies. Please go ahead.
Operator: Our next question will come from the line of Dan Fannon with Jefferies. Please go ahead.
Speaker #1: ahead. Thanks.
[Analyst] (Jefferies): Thanks. Good morning. So wanted to follow up, Chris, on your comments around slide 10 and just the addressable market. I think you mentioned that 2025, some of the electronification slowed. And so just wanted to get a sense of what gives you confidence about that reaccelerating here in 2026, more broadly, as we just think about, obviously, the protocols you've been doing, but if there was other things idiosyncratic in the market or competition-wise that maybe slowed that down.
Dan Fannon: Thanks. Good morning. So wanted to follow up, Chris, on your comments around slide 10 and just the addressable market. I think you mentioned that 2025, some of the electronification slowed. And so just wanted to get a sense of what gives you confidence about that reaccelerating here in 2026, more broadly, as we just think about, obviously, the protocols you've been doing, but if there was other things idiosyncratic in the market or competition-wise that maybe slowed that down.
Speaker #9: Good morning. So, I wanted to follow up, Chris, on your comments around slide 10 and just the addressable market. I think you mentioned that in 2025, some of the E, or the electronification, slowed.
Speaker #9: And so I just wanted to get a sense of what gives you confidence about '26 more broadly, as we just think about, obviously, the protocols you've been doing.
Speaker #9: But if there was, other than re-accelerating here, anything idiosyncratic in the market or competition-wise that maybe slowed that down.
Speaker #7: Sure. Great question. Something we obviously focus on is converting this market from phone to platform. And the market opportunity is larger than what has been converted today.
Chris Concannon: Sure. Great question. Something we obviously focus on is converting this market from phone to platform, and the market opportunity is larger than what has been converted today. So when you think about that, the opportunity is enormous, and we're still early in the journey of electronification of the global fixed income market. With regard to our slides, really, if you look at US credit, that's really where the growth of electronification across the entire market has plateaued, kind of flatlined. Somewhere, it's hard to estimate, but somewhere in the 45% to 50% range. What's holding it back from further conversion, when you analyze what is not on platform, it's really phone and chat block market.
Chris Concannon: Sure. Great question. Something we obviously focus on is converting this market from phone to platform, and the market opportunity is larger than what has been converted today. So when you think about that, the opportunity is enormous, and we're still early in the journey of electronification of the global fixed income market. With regard to our slides, really, if you look at US credit, that's really where the growth of electronification across the entire market has plateaued, kind of flatlined. Somewhere, it's hard to estimate, but somewhere in the 45% to 50% range. What's holding it back from further conversion, when you analyze what is not on platform, it's really phone and chat block market.
Speaker #7: So when you think about that, the opportunity is enormous. And we’re still market. With regard to our slides, really, if you look at US credit, that’s really where the growth of electronification across the entire market has plateaued.
Speaker #7: Kind of flatlined. Somewhere, it's hard to estimate, but somewhere in the 45% to 50% range. What's holding it back from further conversion—when you analyze what is not on platform, it's really phone and chat block market.
Speaker #7: So that block market makes up the next 50%, roughly. And are chasing. And very look at portfolio focused on. If you trading, the growth of portfolio, that's the market opportunity that we trading because it's all electronic, should have increased the overall electronic footprint in the market.
Chris Concannon: So that block market makes up the next 50%, roughly, and that's the market opportunity that we are chasing and very focused on. If you look at portfolio trading, the growth of portfolio trading, because it's all electronic, should have increased the overall electronic footprint in the market. Ironically, it did not. It converted what was already largely electronic RFQ into just larger baskets, traded as a single price basket. So it was really the growth of portfolio trading that did a really a conversion of E RFQ to E portfolio trading. Now, and look, the market was quite focused on portfolio trading. Both platforms, dealers, and clients were making huge investments to convert their RFQs to portfolio trading. I will tell you, the focus of clients, dealers, and platforms today has shifted to that 50% of US credit.
Chris Concannon: So that block market makes up the next 50%, roughly, and that's the market opportunity that we are chasing and very focused on. If you look at portfolio trading, the growth of portfolio trading, because it's all electronic, should have increased the overall electronic footprint in the market. Ironically, it did not. It converted what was already largely electronic RFQ into just larger baskets, traded as a single price basket. So it was really the growth of portfolio trading that did a really a conversion of E RFQ to E portfolio trading. Now, and look, the market was quite focused on portfolio trading. Both platforms, dealers, and clients were making huge investments to convert their RFQs to portfolio trading. I will tell you, the focus of clients, dealers, and platforms today has shifted to that 50% of US credit.
Speaker #7: Ironically, it did not. It converted what was already largely electronic RFQ into just larger baskets traded, as it was really the growth of portfolio single price basket.
Speaker #7: Trading that did a really a conversion of E RFQ to E portfolio trading. Now, so it—and look, the market was quite focused on portfolio trading. Both platforms, dealers, and clients were making huge investments to convert their RFQs to portfolio trading.
Speaker #7: I will tell you, the focus of clients, dealers, and platforms today has shifted to that 50% of U.S. credit. It's all targeting block market.
Chris Concannon: It's all targeting block market. That's the exciting piece, and our earlier discussion on our block growth is really reflective of the investment we're making in that block market. When you jump from US credit into other product areas, EM in particular, we're still early days electronic penetration. So we're seeing our portfolio trading in EM grow dramatically. We're seeing electronic RFQ all-to-all. We're seeing block growth in EM as well. And then finally, our automation suite of products is growing quite handsomely in EM as well. Again, a very low automation penetration in that EM bucket.
Chris Concannon: It's all targeting block market. That's the exciting piece, and our earlier discussion on our block growth is really reflective of the investment we're making in that block market. When you jump from US credit into other product areas, EM in particular, we're still early days electronic penetration. So we're seeing our portfolio trading in EM grow dramatically. We're seeing electronic RFQ all-to-all. We're seeing block growth in EM as well. And then finally, our automation suite of products is growing quite handsomely in EM as well. Again, a very low automation penetration in that EM bucket.
Speaker #7: That's the exciting piece. Earlier discussion on our block—and our growth is really reflective of the block market. When you jump from US credit into other product areas, EM in particular, we're still early days in terms of electronic penetration.
Speaker #7: So, we're seeing our portfolio trading in EM grow—electronic RFQ, all-to-all. We're seeing block growth in EM as well. And then, finally, our automation suite of products is growing quite handsomely in EM as well.
Speaker #7: Again, a very low automation penetration in net EM bucket. So overall, I just love the fact that our market opportunity is greater than what has been converted today.
Chris Concannon: So overall, I just love the fact that our market opportunity is greater than what has been converted today around the globe, and that just is an exciting opportunity for us as we deploy more and more products targeting that specific block market, which is left to convert.
Chris Concannon: So overall, I just love the fact that our market opportunity is greater than what has been converted today around the globe, and that just is an exciting opportunity for us as we deploy more and more products targeting that specific block market, which is left to convert.
Speaker #7: Around the globe. And that just is an exciting opportunity for us as we deploy more and more products targeting that specific block market, which is left to convert.
Speaker #9: Great. Thank you.
Rachel Smith: Great. Thank you.
Dan Fannon: Great. Thank you.
Operator: Our next question comes from the line of Eli Abboud with Bank of America. Please go ahead.
Operator: Our next question comes from the line of Eli Abboud with Bank of America. Please go ahead.
Speaker #1: Comes from the line of Eli Aboud with Bank of America. Please go ahead.
Speaker #8: Good morning. Thanks for that. I wonder if that has changed how you think about capital allocation. Does it still make sense to allocate that incremental dollar to US credit versus other areas like emerging markets or munis that are growing faster?
Eli Abboud: Good morning. Thanks for taking the question. I wanted to follow up on the last one about the overall kind of slowdown in electronification in US credit this past year. I wonder if that has changed how you think about capital allocation. Does it still make sense to allocate the incremental dollar to US credit versus other areas like emerging markets or munis that are growing faster? And then if I could just squeeze in, like, a follow-up here. I was hoping we could get an update, too, on the opening and closing auction initiative and what the early returns have been there. Thanks.
Eli Abboud: Good morning. Thanks for taking the question. I wanted to follow up on the last one about the overall kind of slowdown in electronification in US credit this past year. I wonder if that has changed how you think about capital allocation. Does it still make sense to allocate the incremental dollar to US credit versus other areas like emerging markets or munis that are growing faster? And then if I could just squeeze in, like, a follow-up here. I was hoping we could get an update, too, on the opening and closing auction initiative and what the early returns have been there. Thanks.
Speaker #8: Taking the 'Our next question' question, I wanted to follow up on the last one about the overall kind of slowdown in electronification in US credit this past year.
Speaker #8: And then, if I could just squeeze in a follow-up here. I was hoping we could get an update, too, on the opening and closing auction initiative, and what the early returns have been there.
Speaker #8: Thanks.
Speaker #7: Sure. Yeah. First, what's great about the opportunity—and we really, we were just talking about blocks where we had substantial growth. Our investment in the, actually, very similar across product sets.
Chris Concannon: Sure. Yeah. First, what's great about the opportunity, and really, we were just talking about blocks where we had substantial growth. Our investment in the block opportunity is actually very similar across product set. So whether we're investing in EM blocks or we're investing in US credit blocks, the way we have built our technology, our new technology on XPro, it scales across both product sets. So the incremental investment has very high returns because we have shifted to investing our protocols into global protocols as opposed to individual product protocols. So that's the exciting part. So any investment in a block solution is an investment in a block solution across a protocol, so the high return on that investment is quite attractive.
Chris Concannon: Sure. Yeah. First, what's great about the opportunity, and really, we were just talking about blocks where we had substantial growth. Our investment in the block opportunity is actually very similar across product set. So whether we're investing in EM blocks or we're investing in US credit blocks, the way we have built our technology, our new technology on XPro, it scales across both product sets. So the incremental investment has very high returns because we have shifted to investing our protocols into global protocols as opposed to individual product protocols. So that's the exciting part. So any investment in a block solution is an investment in a block solution across a protocol, so the high return on that investment is quite attractive.
Speaker #7: So, whether we're investing in EM blocks or we're investing in US credit blocks, the way we have built our technology, our new technology on ExPro, that scales across both product sets.
Speaker #7: So the incremental investment has very high returns because we have shifted to investing our protocols into global protocols, as opposed to individual product protocols.
Speaker #7: So that's the exciting part. So any investment in a block solution is an investment in a block solution across protocols. So the high return on that investment is quite attractive.
Chris Concannon: And we'll continue to roll out our X-Pro solution, which is really delivering multiple protocols from portfolio trading to blocks to our automation delivery, as well as traditional list RFQ, all delivered on the same technology stack and the same platform, as we roll that out across the globe. So investments, high return, because we're attacking the same unpenetrated market of EM or US credit with very similar techniques in protocol. Turning to our matching solutions, things like Mid-X and auctions, these are all new investments, quite an exciting incremental revenue investment. So, we're seeing sizable growth across our matching solution, Mid-X. I know, Eli, you did a nice report on that in January.
Speaker #7: And we'll continue to roll out our ExPro solution, which is really delivering multiple protocols—from portfolio trading to blocks to our automation delivery, as well as traditional list RFQ.
Chris Concannon: And we'll continue to roll out our X-Pro solution, which is really delivering multiple protocols from portfolio trading to blocks to our automation delivery, as well as traditional list RFQ, all delivered on the same technology stack and the same platform, as we roll that out across the globe. So investments, high return, because we're attacking the same unpenetrated market of EM or US credit with very similar techniques in protocol. Turning to our matching solutions, things like Mid-X and auctions, these are all new investments, quite an exciting incremental revenue investment. So, we're seeing sizable growth across our matching solution, Mid-X. I know, Eli, you did a nice report on that in January.
Speaker #7: All delivered on the same technology stack and the same platform. As we roll that out across the globe, the investments have high return because we're attacking the same unpenetrated market of EM or US credit with very similar techniques and protocol.
Speaker #7: Turning to our matching solutions, things like MIDX and auctions—these are quite exciting incremental revenue investments. All new investments. So we're seeing sizable growth across our matching solution, MIDX.
Speaker #7: I know, Eli, you did a nice report on that in January. I appreciate all the kind remarks around our data set and the feedback from our clients.
Chris Concannon: I appreciate all the kind remarks around our data set and the feedback from our clients. We promise we will use it as a marketing tool to talk to the dealer community. But Mid-X has been growing since we launched it in the fall of last year. It's quite exciting to be part of that match business in the dealer-to-dealer market. Again, we only have one match a day. We plan to increase that to multiple matches per day. So a lot of exciting growth there. Your question on closing auctions, again, a newly launched auction solution. Right now, we're just focused on a closing auction, not an opening auction, and that was launched on an entirely new tech stack brought to us by our Pragma acquisition.
Chris Concannon: I appreciate all the kind remarks around our data set and the feedback from our clients. We promise we will use it as a marketing tool to talk to the dealer community. But Mid-X has been growing since we launched it in the fall of last year. It's quite exciting to be part of that match business in the dealer-to-dealer market. Again, we only have one match a day. We plan to increase that to multiple matches per day. So a lot of exciting growth there. Your question on closing auctions, again, a newly launched auction solution. Right now, we're just focused on a closing auction, not an opening auction, and that was launched on an entirely new tech stack brought to us by our Pragma acquisition.
Speaker #7: We promise we will use it as a marketing tool to talk to the dealer community. But MIDX has been growing since we launched it in the fall of last year.
Speaker #7: It's quite exciting to be part of that match business in the dealer-to-dealer market. Again, we only have one match a day. We plan to increase that to multiple matches per day.
Speaker #7: So, a lot of exciting growth there. Your question on closing auctions—again, a newly launched auction solution—right now, we're just focused on a closing auction, not an opening auction.
Speaker #7: And that was launched on an entirely new tech stack brought to us by our Pragma acquisition. So, a very exciting new tech stack with a new front end used by both clients and dealers.
Chris Concannon: So a very exciting new tech stack with a new front end used by both clients and dealers. The Closing Auction was launched really in sometime in the Q4. It was in a pilot phase, and we just rolled out the auction to a broader set of clients. So as of two weeks ago, we opened it up to a broader set, but we are seeing pretty exciting participation. We've got 3 dealers now supporting liquidity in the auction. We have about 11 buy-side clients that are active in the auction, and we have some very key what I call anchor dealers that are now posting block-sized liquidity into the auction.
Chris Concannon: So a very exciting new tech stack with a new front end used by both clients and dealers. The Closing Auction was launched really in sometime in the Q4. It was in a pilot phase, and we just rolled out the auction to a broader set of clients. So as of two weeks ago, we opened it up to a broader set, but we are seeing pretty exciting participation. We've got 3 dealers now supporting liquidity in the auction. We have about 11 buy-side clients that are active in the auction, and we have some very key what I call anchor dealers that are now posting block-sized liquidity into the auction.
Speaker #7: The closing auction was launched really sometime in the fourth quarter. It was in a pilot phase, and we just rolled out the auction to a broader set of clients.
Speaker #7: So, as of two weeks ago, we opened it up to a broader set. But we are seeing pretty exciting participation. We've got three dealers now supporting liquidity in the auction.
Speaker #7: We have about 11 buy-side clients that are active in the auction, and we have just some very dealers that are now posting block-size liquidity into the key and what I call anchor auction.
Chris Concannon: Some of the stats that we're seeing, again, this was pilot, about $2 billion in notional orders staged in the auction, over $900 million orders submitted into the auction. So we're seeing a great deal of participation. It's interesting, we had a really great, you know, call with our clients. We did a call on this, a webinar just on the Closing Auction. We had over 600 participants join, was kind of one of our record webinars that we've ever seen. But the feedback has been exciting. We've had clients looking for additional bonds to be listed in the auction, and looking to understand.
Speaker #7: Some of the stats that we're seeing—again, this was pilot—about $2 billion in notional orders staged in the auction. Over submitted into the auction.
Chris Concannon: Some of the stats that we're seeing, again, this was pilot, about $2 billion in notional orders staged in the auction, over $900 million orders submitted into the auction. So we're seeing a great deal of participation. It's interesting, we had a really great, you know, call with our clients. We did a call on this, a webinar just on the Closing Auction. We had over 600 participants join, was kind of one of our record webinars that we've ever seen. But the feedback has been exciting. We've had clients looking for additional bonds to be listed in the auction, and looking to understand.
Speaker #7: And so we're seeing a great deal of participation. It's interesting—we had a really great call with our clients. We did a call on this webinar just on the closing auction.
Speaker #7: We had over 600 participants join, which was kind of one of our record webinars that we've ever seen. But the feedback has been exciting. We've had clients looking for additional bonds to be listed in the auction.
Speaker #7: And looking to understand, it is a new protocol that clients have to get used to, because it is a time protocol in the late afternoon of the day, which is new to the buy-side.
Chris Concannon: It is a new protocol that clients have to get used to, because it is a time protocol in the late afternoon of the day, which is new to the buy side. So, again, we don't expect that to ramp up dramatically in the coming quarters. We think that will grow over time and be a key ingredient for larger block size trades near the end of the day.
Chris Concannon: It is a new protocol that clients have to get used to, because it is a time protocol in the late afternoon of the day, which is new to the buy side. So, again, we don't expect that to ramp up dramatically in the coming quarters. We think that will grow over time and be a key ingredient for larger block size trades near the end of the day.
Speaker #7: So again, we don't expect that to ramp up dramatically in the coming $900 million of orders quarters. We think that will grow over time and be a key ingredient for larger block-size trades near the end of the—
Speaker #7: day. Perfect.
Michael Cyprys: Perfect. Thanks, Chris.
Eli Abboud: Perfect. Thanks, Chris.
Speaker #8: Thanks,
Speaker #8: Chris. Our final question
Operator: Our final question will come from the line of Michael Cyprys with Morgan Stanley. Please go ahead.
Operator: Our final question will come from the line of Michael Cyprys with Morgan Stanley. Please go ahead.
Speaker #1: We will come from the line of Michael Cypress with Morgan Stanley. Please go ahead.
Michael Cyprys: Okay, thanks for squeezing me in here. Just a question around artificial intelligence. I was hoping you could speak to some of your ambitions and visions around embedding AI more broadly across the business. Curious, what portion of client flows do you think is ultimately automatable? And how do you think about execution outcome feedback into your AI models, and does that create any sort of flywheel that others cannot catch?
Michael Cyprys: Okay, thanks for squeezing me in here. Just a question around artificial intelligence. I was hoping you could speak to some of your ambitions and visions around embedding AI more broadly across the business. Curious, what portion of client flows do you think is ultimately automatable? And how do you think about execution outcome feedback into your AI models, and does that create any sort of flywheel that others cannot catch?
Speaker #8: Okay, thanks for squeezing me in here. Just a question around artificial intelligence. I'm hoping you can speak to some of your ambitions and visions around embedding AI more broadly across the business.
Speaker #8: Curious, what portion of client flows do you think is ultimately automatable, and how do you think about execution outcome feedback into your AI models? And does that create any sort of flywheel that others cannot?
Speaker #8: catch? Sure.
Chris Concannon: Sure. Exciting area for us, an area that we've been investing for some time. Obviously, our, a number of our data products are AI-based, so we are along that journey, in creating commercial products, through AI. I'll take a step back, and just mention the AI boom itself, is very helpful to the bond market. If you look at, the size of the bond market more recently, it is growing, and it is a result of the funding that AI needs, both in terms of, the equipment and chips that people are buying, through funding, using the bond market, but also, the data center buildouts are all, through bonds.
Chris Concannon: Sure. Exciting area for us, an area that we've been investing for some time. Obviously, our, a number of our data products are AI-based, so we are along that journey, in creating commercial products, through AI. I'll take a step back, and just mention the AI boom itself, is very helpful to the bond market. If you look at, the size of the bond market more recently, it is growing, and it is a result of the funding that AI needs, both in terms of, the equipment and chips that people are buying, through funding, using the bond market, but also, the data center buildouts are all, through bonds.
Speaker #7: Exciting area for us. An area that we've been investing in for some time. Obviously, a number of our data products are AI-based. So we are along that journey in creating commercial products.
Speaker #7: Through AI, I'll take a step back and just mention the AI boom itself. It's very helpful to the bond market. If you look at the size of the bond market more recently, it is growing as a result of the funding that AI needs, both in terms of the equipment and chips that people are buying through funding using the bond market, but also the data center build-outs are all through bonds.
Chris Concannon: And then you'll finally need the utility, the utilities and the infrastructure to support those data centers will likely also come through bond funding. So it's just, it's going to grow the bond market quite dramatically, and we feel, we'll feel the benefits of that over the years to come. With regard to our use of AI, we're pretty excited about where AI can obviously help us. There's the, what I refer to as the corporate AI use, where it will make us more productive, whether it's someone in finance using AI or one of our developers deploying code through AI.
Speaker #7: And then you'll finally need the utility and the infrastructure to support those data centers will likely also come through bond funding. So it's just—it's going to grow the bond market quite dramatically.
Chris Concannon: And then you'll finally need the utility, the utilities and the infrastructure to support those data centers will likely also come through bond funding. So it's just, it's going to grow the bond market quite dramatically, and we feel, we'll feel the benefits of that over the years to come. With regard to our use of AI, we're pretty excited about where AI can obviously help us. There's the, what I refer to as the corporate AI use, where it will make us more productive, whether it's someone in finance using AI or one of our developers deploying code through AI.
Speaker #7: And we feel we'll feel the benefits of that over the years to come. With regard to our use of AI, we're pretty excited about where AI can obviously help us.
Speaker #7: There's what I refer to as the corporate AI use, where it will make us more productive. Whether it's someone in finance using AI, or one of our developers deploying code through AI.
Speaker #7: We're already seeing the benefits of that development, so we're excited about what's to come. And I think we're still in the early stages of leveraging AI to increase our productivity, both in terms of product design as well as product and code writing.
Chris Concannon: We're already seeing the benefits of that development, so we're excited about what's to come, and I think we're still in the early stages of leveraging AI to increase our productivity both in terms of product design, as well as product and code writing. When it comes to commercialization of AI within our trading platform, the dataset is probably the most powerful leverage that we have, and I'm happy to report, as I mentioned earlier, our dataset or our data footprint that we can leverage through AI continues to grow. So things like EM. EM, most local markets are not transparent markets, and so we are leveraging AI to produce transparency in those local markets.
Chris Concannon: We're already seeing the benefits of that development, so we're excited about what's to come, and I think we're still in the early stages of leveraging AI to increase our productivity both in terms of product design, as well as product and code writing. When it comes to commercialization of AI within our trading platform, the dataset is probably the most powerful leverage that we have, and I'm happy to report, as I mentioned earlier, our dataset or our data footprint that we can leverage through AI continues to grow. So things like EM. EM, most local markets are not transparent markets, and so we are leveraging AI to produce transparency in those local markets.
Speaker #7: When it comes to commercialization of AI within our trading platform, the data set is probably the most powerful leverage that we have. And I'm happy to report, as I mentioned earlier, our data set—or our data footprint—that we can leverage through AI continues to grow.
Speaker #7: So, things like EM—EM, most local markets are not transparent markets. And so we are leveraging AI to produce transparency in those local markets.
Speaker #7: The other areas that we're seeing pretty interesting exploration using AI—portfolio construction is a powerful area where we can see clients giving us what I'd call market exposures and not specific bonds.
Chris Concannon: The other areas that we're seeing, pretty interesting exploration using AI, portfolio construction is a powerful area where we can see clients giving us what I'd call market exposures and not specific bonds, and then we would use AI to produce an outcome or a suggested basket that they could buy, either through a PT or something that's available on the market. So the other area that we're exploring is trading signals. We have quite a sizable portion of the world's bond market activity across EM, US credit, Eurobonds, and now Treasuries. So we are seeing that activity before we wake up here in the morning in New York.
Chris Concannon: The other areas that we're seeing, pretty interesting exploration using AI, portfolio construction is a powerful area where we can see clients giving us what I'd call market exposures and not specific bonds, and then we would use AI to produce an outcome or a suggested basket that they could buy, either through a PT or something that's available on the market. So the other area that we're exploring is trading signals. We have quite a sizable portion of the world's bond market activity across EM, US credit, Eurobonds, and now Treasuries. So we are seeing that activity before we wake up here in the morning in New York.
Speaker #7: And then we would use AI to produce an outcome or a suggested basket that they could buy, either through a PT or something that's available in the market.
Speaker #7: So, the other area that we're exploring is trading signals. We have quite a sizable portion of the world's bond market activity, across EM, US credit, Eurobonds, and now Treasuries.
Speaker #7: So, we are seeing that activity before we wake up here in the morning, in New York. And so, the signals that are born using AI across the patterns of behavior on a marketplace are quite powerful.
Chris Concannon: And so the signals that are born using AI across the patterns of behavior on a marketplace are quite powerful, and we have a number of clients asking us about, you know, indicators or heat maps across sectors, across the globe. So there's a number of areas that we see ourselves deploying AI using our proprietary data. Another area is depth of liquidity in the market. Most people can't see the depth of the bond market. It's individually priced inquiries, or over chat. We have the full depth of the market, because of all the prices that we collect on the platform. So these are all areas. Another area is spread prediction, where we are able to predict movement in spread, using AI.
Chris Concannon: And so the signals that are born using AI across the patterns of behavior on a marketplace are quite powerful, and we have a number of clients asking us about, you know, indicators or heat maps across sectors, across the globe. So there's a number of areas that we see ourselves deploying AI using our proprietary data. Another area is depth of liquidity in the market. Most people can't see the depth of the bond market. It's individually priced inquiries, or over chat. We have the full depth of the market, because of all the prices that we collect on the platform. So these are all areas. Another area is spread prediction, where we are able to predict movement in spread, using AI.
Speaker #7: And we have a number of clients asking us about indicators or heat maps across sectors across the globe. So there's a number of areas that we see ourselves deploying AI using our proprietary data.
Speaker #7: Another area is depth of liquidity in the market. Most people can't see the depth of the bond market. It's individually priced inquiries, or over chat.
Speaker #7: We have the full depth of the market because of all the prices that we collect on the platform. So, these are all areas. Another area is spread prediction.
Speaker #7: We are able to predict movement in spread. Using AI—again, that's a very powerful piece of information if you're a bond trader, whether you're a dealer or a client.
Chris Concannon: Again, that's a very powerful piece of information if you're a bond trader, whether you're a dealer or a client. So there's, there's lots of uses that we're exploring right now. The last use is just basic chat functionality using AI questions, basic language models, for our clients to understand the market, or make requests of our data, using chat. So there's, there's a number of places that we're exploring. The opportunities are huge, and, and like I mentioned earlier, we made a strategic decision not to sell all of our data, and to use it for things, like trading solutions that I just described. So an exciting new area for us, an exciting new area that we're going to clearly leverage here in 2026.
Chris Concannon: Again, that's a very powerful piece of information if you're a bond trader, whether you're a dealer or a client. So there's, there's lots of uses that we're exploring right now. The last use is just basic chat functionality using AI questions, basic language models, for our clients to understand the market, or make requests of our data, using chat. So there's, there's a number of places that we're exploring. The opportunities are huge, and, and like I mentioned earlier, we made a strategic decision not to sell all of our data, and to use it for things, like trading solutions that I just described. So an exciting new area for us, an exciting new area that we're going to clearly leverage here in 2026.
Speaker #7: So there are lots of uses that we're exploring right now. The last use is just basic chat functionality, using AI to answer basic language model questions. It's for our clients to understand the market or make requests of our data.
Speaker #7: There's a number of places that we're using chat, so exploring. The opportunities are huge. And like I mentioned earlier, we made a strategic decision not to sell all of our, for things like trading. So an exciting new area for solutions that I just described.
Speaker #7: US, and an exciting new area that we're going to clearly leverage here in
Speaker #7: 2026.
Speaker #8: Great. Thank
Rachel Smith: Great. Thank you.
Michael Cyprys: Great. Thank you.
Speaker #8: you.
Operator: That will conclude our question and answer session. I'll hand the call back over to Chris for any closing remarks.
Operator: That will conclude our question and answer session. I'll hand the call back over to Chris for any closing remarks.
Speaker #1: I'll now hand the call back over to Chris for any closing remarks.
Chris Concannon: Thank you all for joining us. We look forward to talking to you on our next quarterly call. Thanks again, and have a great weekend.
Chris Concannon: Thank you all for joining us. We look forward to talking to you on our next quarterly call. Thanks again, and have a great weekend.
Speaker #7: Thank you all for joining us. We look forward to talking to you on our next quarterly call. Thanks again, and have a great weekend.
Operator: This concludes our call today. Thank you all for joining. You may now disconnect.
Operator: This concludes our call today. Thank you all for joining. You may now disconnect.
