MarketAxess Reports Third Quarter 2026 Financial Results

EPS of $1.53; $1.86 Excluding Notable Items¹

1% Revenue Growth Reflects Strong Information Services Revenue Growth of 10%

21% Increase in Block Trading ADV and 37% Increase in Portfolio Trading ADV with Broad-Based Growth

Across U.S. Credit, Emerging Markets and Eurobond Block ADVs

Continued Focus on Expense Discipline

NEW YORK--(BUSINESS WIRE)--MarketAxess Holdings Inc. (Nasdaq: MKTX), the operator of a leading electronic trading platform for fixed-income securities, today announced financial results for the third quarter ended September 30, 2026.

Table 1: 3Q26 Select Financial Results

3Q26 Overview of Results

Table 1A: Notable Items¹

Notable Items¹

• Notable items (pre-tax) in 3Q26 include merger-related expenses of $13.1 million associated with the pending merger with Intercontinental Exchange, Inc.

Revenue

• Total revenues of $210.4 million increased 1% compared to the prior year, primarily driven by growth in services revenue.²

Table 1B: 3Q26 Variable Transaction Fee Per Million (FPM)

Commissions Revenue

• Commissions revenue of $179.9 million was flat compared to the prior year.

Credit

— Total credit commission revenue of $161.2 million (including $34.8 million in fixed distribution fees) decreased $3.8 million, or 2%, compared to $164.9 million (including $34.1 million in fixed distribution fees) in the prior year. The decrease was primarily driven by a 4% decrease in U.S. credit commission revenue reflecting lower variable transaction fee per million ("FPM"), partially offset by higher market volumes and fixed distribution fees. Total credit ADV increased 7% compared to the prior year, mainly due to market share gains in high yield and municipal bonds, volume growth in emerging markets, and higher market activity. Total credit FPM decreased 9% compared to the prior year, largely due to protocol and product mix, as well as lower duration of bonds traded in U.S. high-grade.

Rates

— Total rates commission revenue of $8.9 million increased $2.3 million, or 34%, compared to the prior year, primarily driven by higher U.S. Treasury volumes and improved FPM.

Other

— Total other commission revenue of $9.8 million increased $1.2 million, or 14%, compared to the prior year, primarily driven by higher trading volumes.

Services Revenue

• Services revenue² of $30.5 million increased $1.8 million, or 6%, compared to the prior year.

Information Services

— Information services revenue of $15.2 million increased $1.4 million, or 10%, compared to the prior year. The increase was principally driven by net new contract revenue.

Post-trade Services

— Post-trade services revenue of $11.4 million increased $0.2 million, or 1%, compared to the prior year, mainly due to net new contract revenue.

Technology Services

— Total technology services revenue of $3.9 million increased $0.3 million, or 8%, compared to the prior year, largely reflecting higher broker execution and port fees.

Expenses

• Total expenses of $136.0 million increased 10% from the prior year. Total expenses, excluding notable items,¹ of $122.9 million were flat compared to the prior year.

Non-operating

• Other income (expense): Other income was $0.4 million, down from $8.1 million in the prior year. The decrease was largely driven by receipt of a tax credit in the prior year, lower interest income resulting from lower average cash balances, higher interest expense mainly due to borrowings on the Company’s credit facility, which, along with cash on hand, were used to fund the accelerated stock repurchase agreement that settled in 1Q26, and higher foreign currency transaction losses.
• Tax rate: The effective tax rate was 27.8%, compared to 27.1% in the prior year. The effective tax rate excluding notable items¹ was 25.4%, compared to 27.1% in the prior year.

Capital

• The Company had $539.6 million in cash, cash equivalents, corporate bond investments and U.S. Treasury investments as of September 30, 2026, down from $678.9 million as of December 31, 2025. The decline from year-end 2025 primarily reflects capital allocation activity during the first nine months of 2026, including share repurchases, repayment of $128.0 million of borrowings under the revolving credit facility and quarterly dividends, as well as an increase in net receivables from broker-dealers, clearing organizations and customers, partially offset by cash generated from operating activities. The Company had $92.0 million in borrowings outstanding under the Company’s credit facility as of September 30, 2026, as compared to $220.0 million in borrowings outstanding as of December 31, 2025.
• The Board declared a quarterly cash dividend of $0.78 per share, payable on November 25, 2026 to stockholders of record as of the close of business on November 11, 2026.

Other

• Employee headcount was 858 as of September 30, 2026, compared to 896 as of September 30, 2025, and 863 as of June 30, 2026.

Non-GAAP Financial Measures and Other Items

To supplement the Company’s unaudited financial statements presented in accordance with generally accepted accounting principles (“GAAP”), the Company uses certain non-GAAP financial measures, including earnings before interest, taxes, depreciation and amortization (“EBITDA”), EBITDA margin and free cash flow. From time to time, we present selected GAAP-basis financial results, excluding notable items. Notable items are revenues, expenses, other income (expense) and tax related items that are not indicative of ongoing operating performance and outside of the Company’s normal course of business, including merger, acquisition and restructuring charges or gains/losses on sales or other notables (collectively, “notable items”). We define Operating leverage, excluding notable items, as the year-over-year percentage change in revenues less the year-over-year percentage change in expenses, excluding notable items, for the respective period. We define EBITDA margin as EBITDA divided by revenues. We define free cash flow as net cash provided by/(used in) operating activities excluding the net change in trading investments and net change in securities failed-to-deliver and securities failed-to-receive from broker-dealers, clearing organizations and customers, less expenditures for furniture, equipment and leasehold improvements and capitalized software development costs. Non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, financial measures determined in conformity with GAAP. The Company believes that these non-GAAP financial measures, when taken into consideration with the corresponding GAAP financial measures, provide additional information regarding the Company’s operating results because they assist both investors and management in analyzing and evaluating the performance of our business. Please refer to Tables 8A, 8B, 9 and 10 for a reconciliation of: (i) selected GAAP-basis financial results, each excluding notable items, to their most directly comparable GAAP measure; (ii) GAAP net income to EBITDA and GAAP net income margin to EBITDA margin; and (iii) GAAP net cash provided by/(used in) operating activities to free cash flow, in each case, the most directly comparable GAAP measure.

ICE Transaction

On July 29, 2026, MarketAxess entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Intercontinental Exchange, Inc. (“ICE”) and Igloo Merger Sub II, Inc., a wholly owned subsidiary of ICE. Under the Merger Agreement, the ICE subsidiary will merge with and into MarketAxess (the “Merger”), and MarketAxess will survive as a wholly owned subsidiary of ICE. At the effective time of the Merger, each outstanding share of MarketAxess common stock will be converted into the right to receive $167.00 in cash, without interest, other than certain excluded shares, including shares held by stockholders who properly exercise appraisal rights under Delaware law. On October 21, 2026, the Department of Justice and the Federal Trade Commission granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, applicable to the Merger. Completion of the Merger remains subject to MarketAxess stockholder approval, the receipt of required regulatory approvals and the satisfaction or waiver of the other closing conditions in the Merger Agreement. A copy of the press release announcing the Merger can be found on the Investor Relations section of the MarketAxess corporate website at http://investor.marketaxess.com.

In light of the Merger, MarketAxess has suspended the practice of hosting an earnings conference call. Further, MarketAxess has suspended the practice of issuing guidance and has withdrawn its previously announced 2026 annual guidance, as well as its medium-term financial targets. Finally, MarketAxess has suspended its practice of issuing monthly volumes press releases.

General Notes Regarding the Data Presented

Reported MarketAxess volume in all product categories includes only fully electronic trading volume. MarketAxess trading volumes and the Financial Industry Regulatory Authority (“FINRA”) Trade Reporting and Compliance Engine (“TRACE”) reported volumes are available on the Company’s website at investor.marketaxess.com/volume.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Section 27A”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Section 21E”). We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A and Section 21E. Such forward-looking statements relate to, without limitation, the proposed transaction, our future economic performance, plans and objectives for future operations, and projections of revenue and other financial items. Forward-looking statements can be identified by the use of words such as “may,” “will,” “assume,” “believe,” “contemplate,” “could,” “intend,” “predict,” “would,” “plan,” “potential,” “projected,” “should,” “expect,” “anticipate,” “estimate,” “target,” “continue,” “trend,” “objective,” “might” or comparable terminology, although not all forward-looking statements contain these identifying words.

Forward-looking statements are inherently subject to certain risks, trends, changes in circumstances and uncertainties, many of which we cannot predict with accuracy and some of which we may not anticipate, including, but not limited to: historical financial information may not be representative of future results; the completion of the proposed transaction on the anticipated terms and timing, or at all, including obtaining the requisite approval by the stockholders of the Company, the receipt of the remaining required regulatory approvals, and the satisfaction of other conditions to the completion of the proposed transaction as well as the failure to realize anticipated benefits of the proposed transaction; there may be significant transaction costs in connection with the proposed transaction and the proposed transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; there may be liabilities that are not known, probable or estimable at this time or unexpected costs, charges or expenses; the occurrence of any event, change or other circumstance that could give rise to the termination of the proposed transaction, including in circumstances requiring the Company to pay a termination fee pursuant to the terms of the Merger Agreement; any effect of the announcement of the proposed transaction on the Company’s ability to operate its business and retain and hire key personnel and to maintain favorable business relationships; the proposed transaction may result in the diversion of management’s time and attention from ordinary course business operations to issues relating to the proposed transaction; certain restrictions during the pendency of the proposed transaction that may impact the Company’s ability to pursue certain business opportunities or strategic transactions; unfavorable outcome of legal proceedings related to the proposed transaction; the risk that the Company’s share price may decline significantly if the proposed transaction is not consummated; legislative, regulatory and economic developments; unpredictability and severity of catastrophic events, including, but not limited to, acts of terrorism, outbreaks of war or hostilities or public health issues, as well as management’s response to any of the aforementioned factors; other risks and uncertainties detailed in periodic reports that the Company files with the SEC; actions by third parties, including government agencies; reputational risk and potential adverse reactions of the Company’s or ICE’s customers, employees or other business partners, including those resulting from the announcement or completion of the proposed transaction; the ability to promptly and effectively integrate the Company’s business with ICE’s business and realize the anticipated cost savings, synergies, and other financial benefits of the proposed transaction within the expected time period or at all; ICE’s ability to obtain the contemplated debt financing on a timely basis, on favorable terms or at all; global economic, political and market factors; the level of trading volume transacted on the MarketAxess platform; the rapidly evolving nature of the electronic financial services industry; the level and intensity of competition in the fixed-income electronic trading industry and the pricing pressures that may result; the variability of our growth rate; our ability to introduce new fee plans and our clients’ response; our ability to attract clients or adapt our technology and marketing strategy to new markets; risks related to our growing international operations; our dependence on our broker-dealer clients; the loss of any of our significant institutional investor clients; our exposure to risks resulting from non-performance by counterparties to transactions executed between our clients in which we act as an intermediary in matched principal trades; risks related to self-clearing; our dependence on third-party suppliers for key products and services; our ability to enter into strategic alliances and to acquire other businesses and successfully integrate them with our business; our dependence on our management team and our ability to attract and retain talent; risks related to sanctions levied against states or individuals that could expose us to operational or regulatory risks; the effects of climate change or other sustainability risks that could affect our operations or reputation; the effect of rapid market or technological changes on us and the users of our technology; issues related to the development and use of artificial intelligence; our ability to successfully maintain the integrity of our trading platform and our response to system failures, capacity constraints and business interruptions; the occurrence of design defects, errors, failures or delays with our platforms, products or services; our vulnerability to malicious cyber-attacks and attempted cybersecurity breaches; our actual or perceived failure to comply with privacy and data protection laws; our ability to protect our intellectual property rights or technology and defend against intellectual property infringement or other claims; our use of open-source software; limitations on our flexibility because we operate in a highly regulated industry; the increasing government regulation of us and our clients; our exposure to costs and penalties related to our extensive regulation; our risks of litigation and securities laws liability; our tax filing positions; our future capital needs and our ability to obtain capital when needed; limitations on our operating flexibility contained in our credit agreement; our exposure to financial institutions by holding cash in excess of federally insured limits; and other factors.

There can be no assurance that the proposed transaction will be completed, or if it is completed, that it will close within the anticipated time period. While the list of factors presented here is considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties and should be read in conjunction with the other forward-looking statements. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. The forward-looking statements relate only to events as of the date on which the statements are made and we undertake no obligation to update, and expressly disclaim any obligation to update, any forward-looking statements, or any other information in this communication, whether resulting from developments, circumstances or events that arise after the date the statements are made, new information, or otherwise. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary materially from what we may have expressed or implied by these forward-looking statements. All forward-looking statements in this communication are qualified in their entirety by this cautionary statement. You should specifically consider the factors identified in this communication that could cause actual results to differ. Furthermore, new risks and uncertainties arise from time to time, and it is impossible for us to predict those events or how they may affect us.

Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions at the time made, we can give no assurance that such expectations will be achieved as anticipated or that our results, estimates or assumptions will be correct.

INVESTOR RELATIONS
Hannah Hendricks
MarketAxess Holdings Inc.
+1 212 813 6011
hhendricks@marketaxess.com

MEDIA RELATIONS
Marisha Mistry
MarketAxess Holdings Inc.
+1 917 267 1232
mmistry@marketaxess.com