Tradeweb Markets Inc.

Good morning, and welcome to TradeWeb's second quarter 2024 earnings conference call. As a reminder, today's call is being recorded and will be available for playback. To begin, I'll turn the call over to Head of Treasury, FP&A, and Investor Relations, Ashley Sorrell. Please go ahead.

Thank you, and good morning. Joining me today for the call are CEO Billy Hult, who will review our business results and key growth initiatives, and our CFO, Sarah Ferber, will review our financial results. We intend to use the website as a means of disclosing material, nonpublic information, and complying with our disclosure obligations under Regulation FD. I'd like to remind you that certain statements in this presentation and during the Q&A may relate to future events and expectations, and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements related to, among other things, our guidance and the ICD acquisition are forward-looking statements. Actual results may differ materially from these forward-looking statements. Information concerning factors that could cause actual results to differ from forward-looking statements is contained in our earnings release, earnings presentation, and periodic reports filed with the SEC. In addition, on today's call, we will reference certain non-GAAP measures, as well as certain market and industry data. Information regarding these non-GAAP measures, including reconciliations to GAAP measures, is in our earnings release and earnings presentation. Information regarding market and industry data, including sources, is in our earnings presentation. Now, let me turn the call over to Billy.

Thanks, Ashley. Good morning, everyone, and thank you for joining our second quarter earnings call. This was another outstanding quarter. As central banks step back, private sector intermediation continues to be in vogue. From evolving inflation prints to snap elections across Europe and the UK, the macro debate continues to flourish globally, and our one-stop solution is resonating with our clients. At our core, we are a technology company that caters to the financial service industry. We have a simple job. How can we continue to save our clients time and money and provide them with more efficient means of trading in the financial markets? Change is constant. and we are focused on being on the forefront of that change, be it technological, market structure, or behavioral. As the markets and our clients evolve, we continue to position TradeWeb for the future. After closing our acquisitions of YieldBroker and RateFin, we are pleased to have announced the signing of an agreement to acquire ICD in April. We are on track to close ICD shortly, which will add corporates as our fourth client channel. Diving into the second quarter, we achieved our best second quarter in our history. Specifically, strong client activity, share gains, and risk on environment drove 30.4% year-over-year revenue growth on a reported basis. We continue to balance investing for growth and profitability as adjusted EBITDA margins expanded by 98 basis points relative to the second quarter of 2023. Turning to slide five, rates and credit led the way, accounting for 61% and 29% of our revenue growth, respectively. Specifically, the rates business was driven by continued organic growth across global government bonds, swaps, and mortgages, and was also supplemented by the addition of RateFin and YieldBroker. Credit was led by strong U.S. and European corporate credit with record quarterly market share and electronic U.S. investment grade, and aided by strong growth across municipal bonds, China bonds, and credit derivatives. Money markets was led by continued growth in institutional repos. Equities posted low single-digit revenue growth, despite challenging industry volumes in our core ETF business. Finally, market data revenues were driven by growth in our LSEG market data contract and proprietary data products. Turning to slide six, I will provide a brief update on two of our focus areas, U.S. Treasuries and ETFs, and then I will dig deeper into U.S. credit and global interest rate swaps. Starting with U.S. Treasuries, record second quarter revenues increased by 28% year over year, led by records across all our client channels. Our institutional business saw record adoption of our streaming protocol and growing usage of our RFQ Plus offerings. The leading indicators of the institutional business remain strong. We gained share and achieved record quarterly market share of U.S. Treasuries versus Bloomberg, crossing the 50% threshold for the first time, which we have maintained. Client engagement was healthy with institutional average daily trades up 45% year over year. Automation continues to be an important theme with institutional U.S. Treasury AIX average daily trades increasing by nearly 100% year-over-year. Our wholesale business produced record volumes led by our streaming offering. Our other protocols also saw strong growth, particularly our CLOB, which has begun to trend higher. Our recent acquisition of RateFin is off to a strong start, contributing approximately 2.3% to our overall U.S. Treasury market share, complementing our CLOB and streaming protocols. The team remains focused on onboarding more club liquidity providers over the coming quarters as they deliver on a holistic strategy across our wholesale protocols. Within equities, our ETF revenues grew mid-single digits but faced a tougher industry backdrop given lower equity market volatility. Other initiatives to expand our equity brand beyond our flagship ETF franchise continue to bear fruit with second quarter convertible bond revenues increasing by 10% year over year. Looking ahead, the client pipeline remains strong as the benefits of our electronic solutions continue to resonate. We believe we are well positioned to capitalize on the long-term secular ETF growth story, not just in equities, but across our fixed income business. Turning to slide seven for a closer look at another strong quarter for credit, Strong double-digit revenue growth was driven by 33% and 29% year-over-year revenue growth across U.S. and European credit, respectively. We also achieved strong double-digit growth across munis, China bonds, and credit derivatives. Automation continued to surge with global credit AIX average daily trades increasing by about 45% year-over-year. We set another fully electronic quarterly market share record in US IG helped by a record IG block market share of 9%. We also achieved our second highest fully electronic market share in US high yield. Our institutional business continues to scale as clients adopt our diverse set of protocols to improve liquidity, price transparency, and efficiency. Our primary focus on growing institutional RFQ continues to pay off with average daily volume growing 30% year over year with strong double digit growth across both IG and high yield. Moreover, portfolio trading average daily volume rose 100% year over year with IG portfolio trading reaching record levels. We continue to focus on leading with innovation and this is resonating with our clients. We saw portfolio trading users grow by over 20% year over year, a record number of line items traded in the quarter, and our largest ever portfolio trade in excess of 3 billion. Retail credit revenues were up over 20% year over year as financial advisors continue to allocate investments towards credit to complement their buying of U.S. Treasuries and Retail Certificate of Deposits. All trade, produced a solid quarter with nearly $190 billion in volume, up over 45% year-over-year. Specifically, our all-to-all volumes grew over 20% year-over-year, and our dealer RFQ offering grew over 10% year-over-year. The team continues to be focused on broadening out our network and increasing the number of responders on the all-trade platform. In the second quarter, the average number of responses for all-to-all inquiry rose by 35% year-over-year. We also continue to increase our engagement and wallet share with ETF market makers. Finally, our sessions average daily volume grew over 60% year over year and produced the second highest quarterly average daily volume ever. Looking ahead, US credit remains our biggest focus area and we like the way we are positioned across our three client channels. We believe we have a long runway for growth with ample opportunity to innovate alongside our clients. Our strategy is focused on expanding our network, increasing our wallet share, enhancing our pre and post trade analytics, and continuously improving our protocols and client experience. In the second quarter, we enhanced our RFQ offering with our rollout of RFQ Edge, where we're already seeing over 25% of our RFQ users utilizing RFQ Edge. RFQ Edge takes the traditional RFQ list ticket and incorporates real-time trading data charting functionality and execution cost analysis we also remain very focused on chipping away at high yield and we believe we are well positioned to replicate the success we've had in ig specifically we're making progress in our aladdin integration with the goal of improving the client experience and increasing electronification in these markets we're still on phase two which is focused on all trade and rfq but our teams are already out on the road meeting with respective clients, and walking them through all the enhancements made to date. With our Aladdin integration closing a gap and providing a foundation for growth, we expect high yield growth from here to be driven by the expansion of our client network, led by strategic sales hires, functionality enhancements, and stronger penetration with ETF market makers. Beyond U.S. credit, our EM expansion efforts continue with growing adoption of our portfolio trading and RFQ offerings and early positive signs across wholesale EM. On the product side, we are focused on leveraging our diverse product expertise, enhancing our integration with FX All, and continuing to build out functionality for multi-asset package trading. Moving to slide eight, Global swaps produce record revenues driven by a combination of strong client engagement in response to the macro environment and continued market share gains. Strength here was partially offset by a 3% reduction in duration and elevated quarterly compression activity. All in, global swaps revenues grew 56% year over year and market share rose to 23.6% with record share across dollar, G11, and EM denominated currencies. Central to our ethos is our focus on helping clients by connecting the dots across fixed income products. Given the heightened market volatility across money markets, our repo clients have been increasingly referencing swap curves when evaluating fixed rate repo trades. Yet their process was cumbersome and our clients asked for a better solution. During the quarter, we became the first electronic trading platform to make overnight index swap curves available during the repo trade negotiation process, helping institutional clients assess the price competitiveness of different repo rates across different currencies and maturities. Finally, we continue to make progress across emerging market swaps and our rapidly growing RFM protocol. Our second quarter EM swaps revenues more than doubled year over year. and we believe there is still significant room to grow given the low levels of electronification. Our RFM protocol saw average daily volume rise over 115% year-over-year with adoption picking up. Looking ahead, we believe the long-term swaps revenue growth potential is meaningful. With the market still about 30% electronified, we believe there remains a lot we can do to help digitize our clients' manual workflows while the global fixed income markets and broader swaps market grow. And with that, let me turn it over to Sarah to discuss our financials in more detail.