MarketAxess Reports Third Quarter 2021 Revenues of $162.1 Million, Operating Income of $74.0 Million and Diluted EPS of $1.52

New York, New York, UNITED STATES

Third Quarter Highlights*

  • Revenues of $162.1 million, down 1%
  • Operating income of $74.0 million, down 16%
  • Operating margin of 45.7%
  • Diluted EPS of $1.52, down 15% from $1.78
  • Estimated U.S. high-grade market share of 21.4%
  • Record active total client firms of 1,848 and international client firms of 934

*All comparisons versus third quarter 2020 unless otherwise stated.

NEW YORK, Oct. 20, 2021 (GLOBE NEWSWIRE) -- MarketAxess Holdings Inc. (Nasdaq: MKTX), the operator of a leading electronic trading platform for fixed-income securities, and the provider of market data and post-trade services for the global fixed-income markets, today announced results for the quarter ended September 30, 2021.

"Growth in our global client network and adoption of automated solutions continued in the third quarter in spite of generally weak secondary trading conditions in global credit trading. Credit spreads and credit spread volatility have remained at historically low levels throughout the year," said Rick McVey, chairman and CEO of MarketAxess. "Investments in our international client business are paying off with record estimated market share in Eurobonds and strong trends in global Emerging Markets bond trading. Combined data and post-trade revenue also reached a new record this quarter, providing an important source of diversification."

Third Quarter Results

Total revenues for the third quarter of 2021 decreased 1.2% to $162.1 million, compared to $164.0 million for the third quarter of 2020. Operating income was $74.0 million, compared to $87.8 million for the third quarter of 2020, a decrease of 15.7%. Operating margin was 45.7%, compared to 53.5% for the third quarter of 2020. Net income totaled $58.0 million, or $1.52 per share on a diluted basis, compared to $67.8 million, or $1.78 per share, for the third quarter of 2020.

Commission revenue for the third quarter of 2021 decreased 5.2% to $142.8 million, compared to $150.6 million for the third quarter of 2020. Variable transaction fees decreased 9.0% to $112.1 million for the third quarter of 2021, compared to variable transaction fees of $123.2 million for the third quarter of 2020. Commission revenue includes $1.2 million generated by MuniBrokers, which was acquired in April 2021. U.S. high-grade trading volume as a percentage of FINRA’s high-grade TRACE trading volume was an estimated 21.4% for the third quarter of 2021, compared to an estimated 22.2% for the third quarter of 2020.  

All other revenue, which consists of information services, post-trade services and other revenue, increased to $19.3 million, compared to $13.4 million for the third quarter of 2020. The increase in all other revenue was principally due to $3.4 million of regulatory trade reporting revenue generated by Regulatory Reporting Hub, which was acquired from Deutsche Börse Group in November 2020, net new post-trade services contract revenue of $1.1 million, net new data sales of $0.9 million and $0.5 million of revenue due to the weaker U.S. dollar to U.K. pound sterling exchange rate.

Total expenses for the third quarter of 2021 increased 15.6% to $88.1 million, compared to $76.2 million for the third quarter of 2020. The increase in total expenses was largely due to higher depreciation and amortization of $4.9 million, which includes acquired intangibles expense of $3.2 million; higher professional and consulting fees of $2.6 million, mainly attributable to non-recurring integration costs associated with the Regulatory Reporting Hub transaction of $1.1 million and IT consulting fees of $0.9 million; and higher technology and communication costs of $2.2 million which was partially offset by a decrease in clearing costs of $1.6 million. Expenses in the third quarter of 2021 reflect operating expenses and costs associated with the MuniBrokers and Regulatory Reporting Hub businesses totaling $5.5 million. Excluding the MuniBrokers and Regulatory Reporting Hub expenses, total expenses for the quarter were up 8.4%.

The effective tax rate for the third quarter of 2021 was 22.2%, compared to 23.0% for the third quarter of 2020. The income tax provision for the third quarter of 2021 and 2020 reflected $1.7 million and $5.9 million, respectively, of excess tax benefits related to share-based compensation awards.

Employee headcount was 671 as of September 30, 2021 compared to 599 as of September 30, 2020. The increase in headcount was due to the continued investment in the Company’s growth initiatives, including geographic expansion, trading automation, new trading protocols and the transition to self-clearing.


The Company’s board of directors declared a quarterly cash dividend to $0.66 per share of common stock outstanding, to be paid on November 17, 2021 to stockholders of record as of the close of business on November 3, 2021.

Share Repurchases

A total of 9,189 shares were repurchased in the third quarter of 2021 at a cost of $4.2 million.

Balance Sheet Data

As of September 30, 2021, total assets were $1.6 billion and included $468.5 million in cash, cash equivalents and investments.   Total stockholders’ equity as of September 30, 2021 was $1.1 billion.

Updated Expense Guidance for 2021

The Company is updating its full year 2021 expense guidance range to $360.0 million to $365.0 million, down from a range of $370.0 million to $386.0 million.  The updated expense guidance range reflects, among other items, lower incentive compensation and variable clearing costs.

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 measures of financial performance, including earnings before interest, taxes, depreciation and amortization (“EBITDA”) and free cash flow. The Company believes that these non-GAAP financial measures, when taken into consideration with the corresponding GAAP financial measures, are important in understanding the Company's operating results. See the attached schedule for a reconciliation of GAAP net income to EBITDA and GAAP cash flow from operating activities to free cash flow.

Webcast and Conference Call Information

Rick McVey, Chairman and Chief Executive Officer, Chris Concannon, President and Chief Operating Officer and Christopher Gerosa, Chief Financial Officer, will host a conference call to discuss the Company’s financial results and outlook on Wednesday, October 20, 2021 at 10:00 a.m. EDT. To access the conference call, please dial 855-425-4206 (U.S.) or 484-756-4249 (international). The Company will also host a live audio Webcast of the conference call on the Investor Relations section of the Company's website at A replay of the call will be made available by dialing 855-859-2056 (U.S.) or 404-537-3406 (international) and using the conference ID: 9890509 for one week after the announcement. The Webcast will also be archived on for 90 days following the announcement.

About MarketAxess

MarketAxess operates a leading, institutional electronic trading platform delivering expanded liquidity opportunities, improved execution quality and significant cost savings across global fixed-income markets. A global network of over 1,800 firms, including the world’s leading asset managers and institutional broker-dealers, leverages MarketAxess’ patented trading technology to efficiently trade bonds. MarketAxess’ award-winning Open Trading® marketplace is regarded as the preferred all-to-all trading solution in the global credit markets, creating a unique liquidity pool for a broad range of credit market participants. Drawing on its deep data and analytical resources, MarketAxess provides automated trading solutions, market data products and a range of pre- and post-trade services. For more information, please visit

Cautionary Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements, including statements about the outlook and prospects for Company and industry growth, as well as statements about the Company’s future financial and operating performance. These and other statements that relate to future results and events are based on MarketAxess’ current expectations. The Company’s actual results in future periods may differ materially from those currently expected or desired because of a number of risks and uncertainties, including: global economic, political and market factors; risks relating to the COVID-19 pandemic, including the possible effects of the economic conditions worldwide resulting from the COVID-19 pandemic; risks related to the U.K. exit from the European Union; 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; the effect of rapid market or technological changes on us and the users of our technology; our dependence on third-party suppliers for key products and services; 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; our vulnerability to cyber security risks; 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 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; 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 future capital needs and our ability to obtain capital when needed; limitations on our operating flexibility contained in our credit agreement; and other factors. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. More information about these and other factors affecting MarketAxess’ business and prospects is contained in MarketAxess’ periodic filings with the Securities and Exchange Commission and can be accessed at

Media and Investor Relations Contacts:
David Cresci William McBride
MarketAxess Holdings Inc.  RF|Binder
+1-212-813-6027 +1-917-239-6726
Kyle White  
MarketAxess Holdings Inc.  

MarketAxess Holdings Inc.
Consolidated Statements of Operations
 Three Months Ended  Nine Months Ended 
 September 30,  September 30, 
 2021  2020  2021  2020 
 (In thousands, except per share data) 
Commissions$142,826  $150,586  $475,095  $478,632 
Information services 9,608   8,501   28,614   25,570 
Post-trade services 9,444   4,689   29,553   12,896 
Other 215   230   629   681 
Total revenues 162,093   164,006   533,891   517,779 
Employee compensation and benefits 40,878   37,583   129,698   120,413 
Depreciation and amortization 13,964   9,032   38,840   25,404 
Technology and communications 10,665   8,417   31,245   25,170 
Professional and consulting fees 10,847   8,269   31,191   22,009 
Occupancy 3,265   3,445   9,882   10,205 
Marketing and advertising 1,821   1,148   6,153   5,633 
Clearing costs 3,269   4,838   12,335   16,061 
General and administrative 3,381   3,467   9,893   9,853 
Total expenses 88,090   76,199   269,237   234,748 
Operating income 74,003   87,807   264,654   283,031 
Other income (expense)               
Investment income 108   344   322   2,327 
Interest expense (314)  (1,046)  (676)  (1,046)
Other, net 697   860   (1,952)  (242)
Total other income (expense) 491   158   (2,306)  1,039 
Income before income taxes 74,494   87,965   262,348   284,070 
Provision for income taxes 16,536   20,189   56,645   57,624 
Net income$57,958  $67,776  $205,703  $226,446 
Per Share Data:               
Net income per common share               
Basic$1.54  $1.81  $5.49  $6.06 
Diluted$1.52  $1.78  $5.40  $5.94 
Cash dividends declared per common share$0.66  $0.60  $1.98  $1.80 
Weighted-average common shares:               
Basic 37,529   37,386   37,502   37,343 
Diluted 38,084   38,160   38,114   38,129 

MarketAxess Holdings Inc.
Commission Revenue Details
 Three Months Ended  Nine Months Ended 
 September 30,  September 30, 
 2021  2020  2021  2020 
 Total Commissions Revenue 
 (In thousands) 
Transaction Fees               
U.S. high-grade$45,848  $60,861  $167,617  $194,039 
Other credit 1 62,475   59,131   208,448   191,718 
Total credit 108,323   119,992   376,065   385,757 
Rates 2 3,825   3,191   11,580   12,623 
Total transaction fees 112,148   123,183   387,645   398,380 
Distribution Fees               
U.S. high-grade 22,257   20,760   64,600   60,369 
Other credit1 8,352   6,586   22,651   19,573 
Total credit 30,609   27,346   87,251   79,942 
Rates2 69   57   199   310 
Total distribution fees 30,678   27,403   87,450   80,252 
Total commissions$142,826  $150,586  $475,095  $478,632 
 Average Variable Transaction Fee Per Million 
U.S. high-grade - fixed-rate$169.13  $204.24  $178.44  $190.68 
U.S. high-grade - floating-rate 44.58   47.75   42.11   50.60 
Total U.S. high-grade 165.02   199.39   173.64   184.83 
Other credit 1 195.72   208.27   197.56   203.75 
Total credit 181.43   203.67   186.14   193.78 
Rates2 4.11   4.19   3.94   3.99 
1 Other credit includes high-yield, emerging markets, Eurobonds and municipal bonds. 
2 Rates includes U.S. Government bonds, agencies and other government bonds. 

MarketAxess Holdings Inc.
Consolidated Condensed Balance Sheet Data
 As of 
 September 30, 2021  December 31, 2020 
 (In thousands) 
Cash and cash equivalents$432,715  $460,858 
Cash segregated under federal regulations 50,134   50,059 
Investments, at fair value 35,767   28,111 
Accounts receivable, net 67,766   79,577 
Receivables from broker-dealers, clearing organizations and customers 551,841   279,915 
Goodwill 154,789   147,388 
Intangible assets, net of accumulated amortization 119,797   95,354 
Furniture, equipment, leasehold improvements and capitalized
software, net
 95,575   85,204 
Operating lease right-of-use assets 72,586   75,924 
Prepaid expenses and other assets 30,948   29,039 
Total assets$1,611,918  $1,331,429 
Liabilities and stockholders' equity       
Accrued employee compensation$49,046  $62,326 
Payables to broker-dealers, clearing organizations and customers 303,439   133,326 
Income and other tax liabilities 44,871   42,750 
Accounts payable, accrued expenses and other liabilities 69,300   44,354 
Operating lease liabilities 89,963   93,612 
Total liabilities 556,619   376,368 
Stockholders' equity       
Common stock 123   123 
Additional paid-in capital 323,631   329,742 
Treasury stock (187,715)  (169,523)
Retained earnings 929,853   799,369 
Accumulated other comprehensive loss (10,593)  (4,650)
Total stockholders' equity 1,055,299   955,061 
Total liabilities and stockholders' equity$1,611,918  $1,331,429 

MarketAxess Holdings Inc.
Reconciliation of Non-GAAP Financial Measures
 Three Months Ended  Nine Months Ended 
 September 30,  September 30, 
 2021  2020  2021  2020 
 Earnings Before Interest, Taxes, Depreciation and Amortization 
 (In thousands) 
Net income$57,958  $67,776  $205,703  $226,446 
Add back:               
Interest expense 314   1,046   676   1,046 
Provision for income taxes 16,536   20,189   56,645   57,624 
Depreciation and amortization 13,964   9,032   38,840   25,404 
Earnings before interest, taxes, depreciation and
$88,772  $98,043  $301,864  $310,520 
 Free Cash Flow 
 (In thousands) 
Cash flows from operating activities$62,813  $(48,353) $136,380  $176,869 
Exclude: Net change in trading investments    638   5,569   (62,636)
Exclude: Net change in fail-to-deliver/receive
from broker-dealers, clearing organizations and customers
 55,195   164,797   121,969   164,797 
Less: Purchases of furniture, equipment and
leasehold improvements
 (4,758)  (3,758)  (14,567)  (13,022)
Less: Capitalization of software development costs (8,191)  (8,121)  (24,650)  (21,124)
Free cash flow$105,059  $105,203  $224,701  $244,884 

MarketAxess Holdings Inc.
Volume Statistics*
 Three Months Ended
September 30,
  Nine Months Ended
September 30,
 2021  2020  2021  2020 
 Total Trading Volume 
 (In millions) 
U.S. high-grade - fixed-rate$268,671  $295,781  $931,345  $1,005,975 
U.S. high-grade - floating-rate 9,166   9,450   33,946   43,830 
Total U.S. high-grade 277,837   305,231   965,291   1,049,805 
Other credit 319,209   283,920   1,055,092   940,939 
Total credit 597,046   589,151   2,020,383   1,990,744 
Rates 929,734   760,676   2,938,869   3,161,148 
 Average Daily Volume 
 (In millions) 
U.S. high-grade$4,341  $4,770  $5,135  $5,555 
Other credit 4,970   4,421   5,605   4,972 
Total credit 9,311   9,191   10,740   10,527 
Rates 14,525   11,885   15,632   16,726 
Number of U.S. Trading Days 1 64   64   188   189 
Number of U.K. Trading Days 2 65   65   189   190 
1 The number of U.S. trading days is based on the SIFMA holiday recommendation calendar. 
2 The number of U.K. trading days is based on the U.K. Bank holiday schedule. 
*Consistent with FINRA TRACE reporting standards, both sides of trades are included in the Company's reported volumes when the Company executes trades on a matched principal basis between two counterparties. Consistent with industry standards, U.S. Government Bond trades are single-counted.