Tradeweb Markets Inc.

Good morning and welcome to TradeWeb's third quarter 2026 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 Serrao. Please go ahead.

Thank you and good morning. Joining me today for the call are our CEO, Billy Hult, who will review our business results and key growth initiatives. and our CFO, Sara Furber, who will review our financial results. We intend to use the website as a means of disclosing material, non-public 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, our future performance, our proposed acquisition of TruMid, and the industry and markets in which we operate 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, and thank you for joining our third quarter earnings call. We delivered another outstanding quarter, generating the second highest quarterly revenue in our history and building on the record performance we achieved in the first half of the year. Through the first nine months of the year, we've generated over $1.7 billion of revenue, surpassing what we delivered in all of 2024. Growth in our markets is never going to be a straight line. Volatility changes, issuance changes, interest rates change, and client behavior changes. But if you believe that over the next 10 years, global fixed income markets are going to continue to grow and that more of the activity in those markets is going to move from voice and manual workflows towards electronic, automated, and increasingly intelligent workflows, then our opportunity is going to compound right along with that. We are already seeing that opportunity play out in our results. In the third quarter, we set a record for monthly swap share in September, posted our second highest monthly electronic share and investment grade credit in September, excluding affiliate trades, and reached our second highest U.S. Treasury share in August. And yet, as encouraging as that progress is, we believe that we are still early in this journey. The majority of global fixed income activity is done over the phone or chat, and the electronification runway in front of us is substantial. We intend to keep investing into our strength organically and inorganically. Last week, we announced we entered into a definitive agreement to acquire TruMid, which would further expand our presence across the credit markets, specifically in the new issue space that trades mainly over the phone. With this acquisition, we will expand our suite of protocols and expand our client coverage across hedge fund clients. Diving into the third quarter, strong client activity and a risk-on environment drove 14.9% year-over-year revenue growth on a reported basis. Our international business remains a key priority, with revenue growing more than 22% as our strategic initiatives across Europe, APAC, and EM continued to pay off. International continued to fire on all cylinders this quarter, contributing more than 60% over overall revenue growth. Importantly, that strength was broad-based, with revenue from European and Asian clients growing nearly 20% and 30% year-over-year, respectively. European government bonds achieved record volumes in September and their second best quarter ever, while Snap Plus usage and AIX trading volumes in European credit also reached record levels in September, underscoring the continued adoption of our innovative protocols and solutions. We continue to balance investing for growth and profitability as adjusted EBITDA margins expanded by 59 basis points relative to the third quarter of 2025. Turning to slide five, we produced the second highest quarterly revenues in our history across rates and credit. Our rates revenues were driven by continued organic growth across swaps and global government bonds. Credit revenues were led by strength across global corporate bonds, municipal bonds, and credit derivatives. Equities were led by growth in global ETFs and equity derivatives. Money markets revenue growth was led by global repos and ICD. Finally, market data revenues were up nearly 20% year-over-year, driven by our LSEG market data contract. Turning to slide 6, I will provide a brief update on a few 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, yields climbed through the quarter and September brought real turbulence. The Fed raised rates for the first time since 2023. The 10-year jumped 50 basis points to above 5.2%, and intraday volatility hit its highest level of the year. Through it all, we continued to perform strongly. Our third quarter market share increased to 23.6%, up 160 basis points year-over-year, leading to over 15% year-over-year revenue growth. Institutional U.S. Treasuries once again produced another strong quarter, with revenues increasing nearly 20% year-over-year, reflecting deeper client engagement and continued adoption of electronic workflows. Our competitive position remains strong. We continue to have over 50% share in electronic institutional U.S. Treasuries versus our largest electronic peer and further widened our share lead year-over-year during the period. We're continuing to build momentum in the basis and multi-leg trades, two large and strategically important workflows that have traditionally remained predominantly voice-driven. Combined, average daily volume across these initiatives grew in excess of 50% year-over-year in the third quarter. We're still early in onboarding clients and dealers across these initiatives, and that's the exciting part because the momentum is already building and we see significant runway from here. Our wholesale US Treasuries saw revenues grow over 15% led by our sweep and wholesale streaming protocols. Wholesale remains a strategic priority for us, and our opportunity there extends well beyond competing on price alone. By broadening our execution capabilities, introducing new protocols, expanding our liquidity network, and deepening client relationships, we're focused on building a more differentiated platform and we believe that will position us to gain durable market share across the wholesale US treasury market. Turning to equities, RFQ has traditionally been a high touch market and AIX is turning into a no touch protocol, helping clients trade faster, more efficiently and at scale. We're also bringing the trade web approach to other equity linked markets that still run largely on phone and chat. were the only platform offering an electronic solution across U.S., European, and Asian convertible bonds. And our new basket trading capability lets clients trade contingently with a dealer on a list of bonds, which is resonating with clients rebalancing portfolios. Against that backdrop, ETFs posted revenue growth in excess of 25% year over year, despite a similar market volatility environment. Client engagement continues to increase and our AIX automation solution continues to be a key differentiator. AIX average daily trades were up over 65% year over year, with over 70% and 20% growth across European ETFs and U.S. ETFs, respectively. Our efforts to broaden our equity presence beyond our flagship ETF franchise continue to pay off. with institutional equity derivative revenues up over 30% year over year. Looking ahead, the pipeline remains strong as the benefits of our electronic solutions continue to resonate with our clients. We're positioned to capture ETF growth on two fronts, the structural expansion of global ETF markets and the pipeline of clients joining us to trade them. We believe the dual exposure sets us apart and it grows more valuable every year. Turning to global credit on slide seven, revenues grew 10% year-over-year driven by 15% growth in U.S. institutional credit, 8% growth in municipal bonds, and 7% growth in international credit. Strength here was partially offset by a 1% year-over-year decline in our retail credit channel. As I mentioned last week, we continue to see credit as one of the largest long-term opportunities across our markets, and our roadmap remains focused on deepening our position across the protocols our clients use most. In U.S. credit, that starts with RFQ, the protocol where most institutional volume still trades. Institutional RFQ average daily volume grew over 30% year over year, with double-digit growth in both IG and high yield. Excluding the impact of affiliate trades in trace, RFQ share of Trace reached another quarterly record. We also achieved record block share in U.S. investment grade with block average daily volume up over 30% year-over-year across IG and high yield. Growth was broad-based across portfolio trading, RFQ, and sessions, demonstrating the value of our multi-protocol approach. Portfolio trading delivered another strong average daily volume with strong double digit growth across both US and international PT. Meanwhile, all trade generated around $246 billion in volume with average daily volume up 20% year over year. Our all to all average daily volume was up over 40% year over year, and our dealer RFQ average daily volume was up over 100% year over year. In September, We enhanced AI Price, our automated pricing engine for investment-grade and high-yield corporate bonds, with expanded data inputs, upgraded machine learning models, and more responsive intraday pricing. These enhancements aim to reduce the need for manual intervention and give clients greater confidence to route larger trades through AIX. We also continued to build out Snap Plus, which uses predictive analytics and proprietary trading data to help clients identify the most appropriate liquidity providers for each trade. Terra, our AI-powered assistant launched last quarter, continues to add firms and users with engagement deepening as more firms bring on multiple active users. Clients are currently using Terra for reporting and analytics, and over time, we see it laying the groundwork for workflows where clients can set parameters, select protocols, and execute within client-defined guardrails. Looking ahead, we remain confident in the long-term outlook for global credit. In EM credit, revenues grew 23% year-over-year, while electronification in EM credit remains in its early stages, we continue to build on our established global network and broad EM product suite to support growing client adoption. In European credit, AIX average daily volume reached its second highest monthly level in September, building on the electronic spread trading protocol we launched for European credit portfolios last quarter. Together, we believe these initiatives position us well to capture the increased adoption of electronic trading and credit. Moving to slide eight, Global swaps delivered its second highest quarterly revenues of 26% year over year. The performance was driven by a combination of strong client engagement across our global suite of currencies, just as importantly, our core risk market share, which excludes compression activity and is the best indicator of our underlying franchise, reached another record, rising 330 basis points year over year. Total market share moved from 21.8% in 3Q25 to 25.3% in 3Q26. Last quarter, I highlighted that our swaps business is not one monolithic business. When we launched swaps in 2005, we offered three currencies and now we are up to 28 currencies. As rates have gone global, so have our clients and we follow our clients. In addition to a global currency set, we also have a global client base that includes asset managers, hedge funds, and numerous central banks that all have different hedging and trading goals. Macroeconomic policy was front and center as global government bonds sold off three months in a row. In August, every one of the 18 10-year benchmarks we tracked moved higher. By September, the Fed, the ECB, The Bank of Japan and the Reserve Bank of Australia had all raised rates while the Bank of England laid out a multi-year plan to shrink its balance sheet. Volatility didn't pick up in only one corner of the market either. It rose across global markets. In September, intraday volatility in dollar, euro, and sterling swaps each jumped roughly 40% from August. When every central bank is moving to its own beat, clients have to manage rate risk in every currency at the same time. Our scaled and growing swaps business saw broad-based growth across developed and emerging markets, with risk trading market share growth accelerating our performance and leading to another strong quarter. We achieved our second highest revenues across institutional dollar, euro, and EM swaps revenues, and we achieved record revenues across APAC swaps. We continue to make progress across emerging market swaps and our rapidly growing RFM protocol. Our third quarter EM swaps revenues produced another strong growth quarter, while our RFM protocol also saw average daily volume grow by more than 65% year over year, with adoption picking up. Looking ahead, we continue to believe the long-term growth potential for swaps remains significant. With just 30% of the cleared swaps market currently electronified, There is substantial runway to digitize workflow alongside our clients. We continue to partner with them to create better workflow solutions across a growing part of the cleared markets and make inroads into the uncleared swaps market. And with that, let me turn it over to Sara to discuss our financials in more detail.