StoneX Group Inc.

developers to the design of support agents for agentic development this should culminate in one accelerated development shortening the time from a proof of concept to a functioning prototype to enhance agility and innovation automating testing and delivery of iterative improvements which should lead to innovation, and three, business solutions, ultimately leading to the delivery of working solutions for our commercial teams that are responsible to our clients' needs. One such example of this was the development of a feature which we estimated would have taken the team without AI approximately two to four times longer to design, test, and launch. This is the sizeable step change we hope to replicate across the organization, whilst ensuring we operate within a standardized framework and remain cognizant of local regulations, controls, and governance. It is a promising start, and we see significant opportunities to leverage technology further, to develop products and services faster, meet our clients' needs, and optimize our resources to continue to deliver strong financial performance With that, I will now turn over to Bill, who will go through this quarter's financial results.

Thank you, Philip. I will begin with the financial overview for the quarter, and we'll be starting with slide number five in the slide deck. Just as a reminder that our board of directors approved a three-for-two split of our common stock, and our shares began to trade on a split-adjusted basis at the market open on March 23rd, 2026. So all per-share metrics on this call will be on a split-adjusted basis. Second quarter net income came in at a record $174.3 million with diluted earnings per share of $2.07. This represented 143% growth in net income. However, earnings per share grew at 120% rate due to an additional shares outstanding as compared to the prior year, primarily related to the issuance of approximately 3.1 million shares related to the acquisition of R.J. O'Brien during the fourth quarter of fiscal 25. Net income and diluted earnings per share were up 25% and 24% respectively versus our immediately preceding first quarter of fiscal 26. This represented a 26.5% return on equity despite a 75% increase in book value over the last two years. On a tangible book basis, this equates to a 37% return on tangible equity for the quarter. We had operating revenues of approximately $1.6 billion, up 64% versus the prior year, and up 9% versus the immediately preceding quarter. As a reminder, our operating revenues include not only interest and fees earned on our client balances, but also carried interest that is related to our fixed income trading activities. Net operating revenues, which nets off interest expense, including that which is associated with our fixed income trading activities, as well as introducing broker commissions and clearing fees, were up 70% versus a year ago and 14% versus the immediately preceding quarter. Total fixed compensation and other expenses were up 44% versus the prior year quarter, with $56.9 million of this attributable to acquisitions made over the last 12 months, most notably RJA and Benchmark. Also contributing to this increase as compared to the prior year, bad debt expense increased $12.3 million primarily within our commercial segment, which despite this had a second consecutive record quarter. Total fixed compensation and other expenses excluding bad debt expense were up 5% or $16.4 million versus the immediately preceding quarter. Fixed compensation and benefits were up 32% versus a year ago and up 13% or $18.7 million versus the immediately preceding quarter. The increase versus the immediately preceding quarter included a $10 million increase in employee benefits, most notably payroll taxes, paid time off benefit costs, and retirement costs, which is typical as we start a new calendar year, as well as $8.5 million in higher severance and retention costs, including costs associated to a formal collective redundancy consolidation process for UK-based employees following the integration of certain RJO entities, as well as severance and retention costs for certain U.S.-based positions relating to ongoing integration activities. These increases were partially offset by higher participation in our employee-elected deferred compensation plan, which is part of our restricted stock plan. Professional fees increased $1.9 million versus the prior year, primarily as a result of higher legal fees related to our defense and various legal matters, net of recoveries. They were down $14.4 million versus the immediately preceding quarter, which included significant legal costs incurred related to the BTIG arbitration matter. During the second quarter, we received the final arbitration award from the FINRA arbitration panel adjudicating the claims between us and BTIG. The panel awarded us $1 million in compensatory damages and awarded BTIG $2.9 million in damages. These amounts were offset and we made a net payment of $1.9 million during the March of 2026. On May 4th, 2026, we made an immaterial payment to fully and finally resolve all differences with BTIG and no additional claims between the parties remained. The conclusion of the BTIG litigation, along with the resolution of the option sellers arbitrations and settlement of the patent case inherited through the acquisition of GAIN Capital, marked the end of the large scale litigation matters that have resulted in heightened legal expenditures over the last five years, most notably the last 24 months. Moving on, I had mentioned the acquisitions over the last 12 months and wanted to touch on the contribution of the most notable one, RJ O'Brien. Excluding amortization of acquired intangibles and a $7.7 million negative mark-to-market adjustment on their investment portfolio, R.J. O'Brien contributed $35 million in pre-tax net income for the quarter, a nice improvement over the immediately preceding first quarter. Looking at our results from a longer standpoint, our trailing 12 months results show operating revenues up 40%. Net income was a record $462.4 million, up 57%. with diluted earnings per share of $5.60, and our return on equity of 19.8% for the trailing 12-month period, above our target of 15%. For the second quarter, our average client equity and FDIC suite balances were $15.2 billion, up 91% versus the prior year, and up 4% versus the immediately preceding quarter. Finally, we ended the second quarter of fiscal 26 with a book value per share of $34.16. Turning to slide number six in the earnings deck, which compares quarterly operating revenues by product, as well as key operating metrics versus a year ago, we experienced operating revenue growth across all products versus the prior year. Transactional volumes were up across all of our product offerings, and spread and rate capture increased in all products with the exception of securities down 3% and payments down 7%. Just touching on a few highlights for the fourth quarter, we saw operating revenues derived from listed derivatives increased $189.4 million, or 148% versus the prior year, primarily due to the acquisition of RJO, which contributed $151.7 million, as well as strong growth in base metals activities in LME markets, which increased $20.2 million versus the prior year. Listed derivative operating revenues increased 18% versus the immediately preceding quarter. Operating revenues derived from OTC derivatives increased 98% versus the prior year, driven by increased client activity and a widening of spreads, most prevalent in agricultural and energy markets, including renewable fuels, driven by heightened volatility as a result of the onset and continuation of the U.S.-Iran conflict. This also represented an 89% increase versus the immediately preceding quarter. We had strong performance in our physical business with operating revenues derived from physical contracts increasing 162% versus the prior year, primarily driven by $116.1 million increase in precious metals operating revenues. Operating revenues derived from physical contracts were up 21% versus a record immediately preceding quarter. Securities operating revenues were up 38% as volumes were up 35%. partially offset by a 3% decline in the rate per million captured versus the prior year, with the improvement driven by growth in U.S. equity volumes, as well as an increase in overall client activity driven by the onset and continuation of the U.S.-Iran conflict. Payment revenues increased 14% versus the prior year quarter due to a strong 19% increase in average daily volume, partially offset by a lower rate per million. Payment revenues were down 2% versus the immediately preceding quarter. FX CFD revenues were up 9% versus the prior year quarter, resulting from a 3% increase in average daily volume and a 6% increase in rate per million, each of which were primarily driven by improved performance in our self-directed business. FX and CFD revenues were up 13% versus the immediately preceding quarter. Our interest and fee income earned on our aggregate client float, including both listed derivatives client equity and money market FDIC suite balances, increased 54.8 million or 54% versus the prior year, with the acquisition of RJO Bryant contributing 53.9 million. Average client equity increased 110% as RJO contributed 6.4 billion in average client equity for the current quarter, while the average money market FDIC suite client balances declined 7%. Turning to slide number seven, this depicts a waterfall byproduct of net operating revenues from both the prior year quarter to the current one, as well as the same for the trailing 12-month periods. Just a reminder, net operating revenues represents operating revenues less introducing broker commissions, transaction-based clearing expenses, and interest expense. For the quarter, net operating revenues increased 70%, principally coming from listed derivatives and physical contracts, up 84.6 million and 116 million, respectively. In addition, we had a very strong quarter in OTC derivatives, which nearly doubled, adding 58.8 million versus the prior year. Net operating revenues from securities also added 36.9 million. On a net basis, interest and fee income on client balances increased $33.2 million, with RJO contributing $30.3 million. Looking at the bottom graph for the trailing 12-month period, listed derivatives has the largest increase, up $187.7 million, primarily as a result of the acquisition of RJO Bryan, as well as strong growth in LME base metal markets. Securities was up $180.6 million versus the prior year, driven by a 27% increase in average daily volume and 17% increase in rate per million. Physical contracts net operating revenues added $162.1 million versus the prior fiscal year, primarily driven by strong performance in precious metals. OTC derivatives added $90.4 million off of strong performance in agricultural and energy markets, including renewable fuels. Interest and fee income increased 87.6 million, primarily as a result of the acquisition of R.J. O'Brien. Moving on to slide number eight, I will do a quick review of our segment performance. Our commercial segment saw record net operating revenues with an increase of 111 percent, primarily resulting from 52 percent and 98 percent increases enlisted in OTC derivatives, respectively. In addition, physical contracts increased 239%, while net interest income and fee income increased 55%. The growth in listed derivative and interest income were primarily driven by the acquisition of RJO, as well as in base metal markets on the LME. Segment income was another record, increasing 151% versus the prior year, while on a sequential basis, net operating revenues were up 30%, and segment income was up 36%. Our institutional segment also saw strong growth in net operating revenues and segment income, up 65% and 40%, respectively. The growth in net operating revenues was principally driven by a $33.3 million increase in securities revenues. In addition, listed derivatives and interest and fee income increased $60.4 million and $14 million, respectively, primarily driven by the acquisition of RJO. On a sequential basis, net operating revenues and segment income declined 3% and 13%, respectively. In our self-directed retail segment, net operating revenues increased 15% and segment income was up 40%, which demonstrates the strong operating leverage in this segment. This growth was driven by a 9% increase in rate per million captured in FX CFD contracts, along with a 3% increase in average daily volumes. On a sequential basis, net operating revenues were up 18%, and segment income increased 65%. Our payment segment net operating revenues were up 10%, and segment income increased 30%. Average daily volume was 19% up versus the prior year, while rate per million was down 7%. Versus the immediately preceding quarter, payments net operating revenues decreased 3%, while segment income decreased 6%. Moving on to slide number nine, looking at segment performance for the trailing 12 months, we saw strong growth in institutional segment with net operating revenues up 62% and segment income increasing 58%. Our commercial and payment segments added 48% and 11% in segment income, respectively. Our self-directed retail segment income decreased 23%. Finally, moving on to slide number 10, which depicts our interest and fees earned on client balances by quarter, as well as a table which shows the annualized interest rate sensitivity for a change in short-term interest rates. The interest and fee income net of interest paid to clients and the effective interest rate swaps increased 29.1 million to 103.6 million in the current period. And as noted, the acquisition of R.J. O'Brien contributed 30.3 million in net interest in the current quarter. On a sequential basis, Interest and fee income, net of interest paid to clients, and the effect of interest rate swaps declined $7.8 million, primarily related to an $11.7 million mark-to-market adjustment on our investment portfolio. During the second quarter of fiscal 2026, we entered into an additional $600 million in fixed-rate SOFR swaps to hedge our aggregate interest rate exposure. which brings our aggregate swap position to 1.8 billion with an average duration of approximately two years and an average rate of 3.38%. These swaps are reflected in the interest rate sensitivity table on this slide. As shown, we now estimate 100 basis point change in short-term interest rates, either up or down, would result in a change to net income by 47.6 million or 58 cents per share on an annualized basis. With that, I will hand you back to Philip for a product spotlight on our global equities business.

Thank you. Now, turning to slide 12, I wanted to highlight another facet of our ecosystem and speak about our principal marketing making business within our global equities business line. Our equities business operates as a global market intermediary built around agency execution, custody and clearing, market making, prime, as well as capital market services. We serve institutional clients offering access to exchanges, liquidity, and clearing and custody infrastructure. We monetize client activity through commissions, spreads, and financing. Through the benchmark acquisition, we further enhanced our relevance to customers with deep equity research and ability to connect users through corporate access and capital market services. We have built an ecosystem that is designed to service clients across the full equities lifecycle. On our next slide, slide 13, turning to equity market making specifically, it is important to recognize the scale and relevance of this business. We are a principal equities market maker providing liquidity and execution across a wide range of global securities. In 2025, Stonex ranked number one in over-the-counter American depository receipts and foreign securities. a position we have held consistently since 2015, according to FINRA ORF data. We make markets in approximately 18,000 equities globally, and we rank number one in over 1,500 individual securities. This is supported by more than 20 years of experience, 24-hour market coverage, and access to 120 global markets. For institutional clients, this matters, because it translates into reliable liquidity, pricing, and execution, particularly in less liquid international or complex stocks. While this part of the business may be less visible than the traditional listed securities, it plays a meaningful role in how institutional investors, asset managers, and retail broker-dealers access global equity markets with StoneX. Moving on to the next slide, slide 14, What makes our market-making franchise different and succeed? Our entry into the highly competitive reg NMS stock was built upon our leading OTC ADR franchise, market experience, and deep institutional relationships developed over decades. This foundation has allowed us to scale into the listed space in a disciplined way. Second, market-making at Stonex operates within a vertically integrated equities ecosystem. As already shown, it exists alongside clearing, custody, prime brokerage, research, and capital markets. It is all connected. This integration improves capital efficiency and allows us to serve clients more comprehensively. Third, we benefit from the aggregation of trading flow across a globally diversified client base that is institutional as well as self-directed retail. This aggregated diverse flow allows us to provide deeper liquidity and more consistent pricing, supporting high quality execution for our clients while managing risk and hedging more efficiently. Finally, technology is the real enabler. Our proprietary electronic platforms are designed to support best execution and allow us to deliver tools focused on execution quality. The result of these factors are reflected in the growth you see here with our reg NMS market-making volumes growing at a compound annual rate of over 130% since 2022. We believe we are a fraction of the total addressable market, which is likely measured in trillions of dollars of notional volume. Lastly, turning to the priorities on slide 15, required to scale the market-making platform. continuing to streamline our operations by consolidating platforms, automating middle office processes, and simplifying reporting and post-trade workflows. This improves operating efficiency and supports our operating margins as volume grows. Second, we are deliberately deepening our market share, expanding our NMS wholesale market-making capabilities, growing outsource trading relationships, and increasing our presence in ETFs and global options, where client demand is rising. Third, we are strengthening our global reach and technology platform. This includes building a footprint in Asia Pacific, expanding sales coverage in the EMEA region, and continuing to invest in the core architecture that underpins our market-making platform. Overall, we expect to process higher volumes expand our global reach, and continue to invest in a platform that is efficient and scalable and supportive of high operating leverage. Importantly, all of this is being done in a way that strengthens our broader equities ecosystem, making Stoenix increasingly relevant to our clients across execution, liquidity, clearing and custody, prime services, research, and capital markets. Now, to close out this presentation, this was a hugely pleasing quarter all round, highlighting record net income of 174.3 million, which is up 143% versus prior year, diluted EPS of $2.07, up 120% versus prior year, and achieving an ROE for the quarter of 26.5% and 19.8% for the trailing 12 months ending March 31st, 2026. And an ROE on tangible book value for the quarter of 37% and 25.9% for the trailing 12 months. Book value per share of $34.16 up $8.43 or 33% versus prior year. And results over the last two years have grown trailing 12 months net operating revenues by 56% or 25% CAGR. And training 12-month earnings by 91%, or nearly 38%, CAGR. A more volatile economic backdrop has emerged, potentially surpassing levels of the past two years. But this environment plays into our strengths, as volatility continues to be a key driver of our business. We have seen significant growth in our client assets. average client funds, securities clearing, prime brokerage, and metals, which provide stable recurring income. We believe our unique ecosystem, which offers extensive depth and breadth of product and a widespread geographical reach, combined with a significant total addressable market, will continue to power growth in the years to come. We naturally remain very excited about our future growth and continued expansion of our ecosystem. With that, operator, would you kindly open the line for questions?