MarketAxess Holdings Inc.

MarketAxess reported first-quarter revenue of $233 million, up 12% year over year, with $230 million under the revenue presentation Ilene referenced in the prepared remarks; record commissions revenue was $203 million, up 12%, and services revenue was a record $30 million, up 10%. Diluted EPS was $2.20, or $2.25 excluding notable items, up 20%; notable items were about $1.5 million of repositioning charges and about $700,000 of legal-related items. Operating margin was 44%, up almost 200 basis points, while non-GAAP expenses increased 8%; free cash flow was $316 million on a trailing 12-month basis. Looking ahead, management did not provide numeric full-year revenue or EPS guidance on the call, but said volumes declined in April due to tighter spreads, lower volatility, and heavy new issuance, and that a new issue trading solution with DirectBooks will pilot at the end of May and expand in the second half of 2026.

Chris Concannon framed the quarter as strong execution against the company’s long-term strategy, emphasizing record revenue, record trading ADV, and approximately 50% of incremental revenue coming from new initiatives. He repeatedly pointed to growth in block trading, portfolio trading, dealer-initiated activity, and international markets, and said the company is “cracking the block market” and building tools to address the new-issue segment. His tone was upbeat and confident, especially around AI, which he described as a structural advantage because of MarketAxess’s proprietary data and global network.

Ilene Bieler highlighted record commissions revenue of $203 million, services revenue of $30 million, and diluted EPS of $2.20, or $2.25 excluding notable items, with 20% EPS growth. She said the quarter benefited from the completed $300 million ASR, which drove a $0.12 EPS benefit through a 6% reduction in share count, and noted a $3 million one-time tax credit in other net. On costs, she said ex-notable expenses rose 8%, operating margin improved to 44%, headcount was 859, cash and investments totaled $537 million at March 31, and the drawn balance on the credit facility was $137 million at the end of April after an additional $20 million paydown post-quarter; $205 million remained under the share repurchase authorization.

Analysts pressed on the strength of the international business and how MarketAxess can defend its moats as competition increases; Chris said EM is still early in electronification and that growth is being driven by block, portfolio trading, and dealer protocols, with Bloomberg as the main competitor in EM and Bloomberg/Tradeweb in Eurobonds. Another major focus was April weakness versus Q1, and management attributed it to lower volatility after March, tighter spreads, the timing of holidays, and unusually heavy new issuance that pulled activity into primary markets and away from secondary trading. Management also addressed the new issue trading solution and said it will be piloted at the end of May, with real-time calendar, pricing, allocation, and later a click-to-trade workflow, plus an update on the closing auction, where over $11 billion in orders were staged and over $7 billion submitted but activity is still early.