TW - Earnings call transcript Q1 2021

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Operator

Good morning, and welcome to Tradeweb's First Quarter 2021 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 US Corporate Development and Investor Relations, Ashley Serrao. Please go ahead.

Ashley Serrao

Thank you and good morning.

Billy the the our and some highlights business financial our for who Lee provide of today dive results. who update; review will will and will of President, our the me growth call deeper Bob CEO, are Olesky, a a initiatives; Joining little who Warshaw, into CFO, Hult, the our quarter review

things, Litigation forward-looking Information I'd are related in like which impacts quarter Q&A potential guidance, differ Actual results Act release, XXXX. events our materially to, remind pandemic, and of with prepared results available is presentation on the actual XXXX and reports the may such, as Reform are statements. earnings accompanying portion earnings presentation the from expectations, forward-looking first including filed that of and COVID-XX certain Our our may of the to forward-looking that statements guidance SEC. meaning and website. to you this Securities periodic contained future forward-looking statements. other statements within statements Statements relations differ investor our the remarks concerning these among of factors and and could constitute the relate in to the during cause are release uncertain, inherently full-year from Private

and non-GAAP release regarding In earnings to addition, are on today's measures. our reference measures, including posted these reconciliations certain call, Information we will measures, in non-GAAP GAAP presentation.

recap, we based GAAP management's sources. see presentation share Please we diluted details. for earnings provide and industry this various $X.XX. reported Lastly, estimates our and which morning, market per data, To on certain earnings of industry posted is more

regarding SEC FX D&A assuming the per earnings diluted be transaction compensation the Refinitiv-related and release the items rate with historical we XX-Q information effective and share reported presentation certain acquisition-related tax income results. expense, of and stock-based the costs, our $X.XX. for filed of see net additional XX%, of Excluding Please Form and adjusted acquisition an non-cash to certain

over Now, turn call me let the to Lee.

Lee Olesky

you thank joining earnings Thanks, call. Ashley. first quarter for our and morning Good everyone,

than XX across and rates, and been driving to electronic more equities For has money changes years, markets. OTC in Tradeweb trading credit, responding

We have harnessing of our our have trading and only challenges limits collaborating our customers technology, redefining of this people, the by to with creativity over complex become the solve done that time. more

our a Tradeweb, genuinely in as world lack our and, team a At The As been network that to efficiency grow a goal broad increasing the our used virtual global for be but change we many has our that the period the customers. largely unfolded think once persists ultimately with result, and response times our everyone linking central to and today. XXXX. have unprecedented developed again we partially to that numerous strategy way dots and migrated that imagination, of and was even captures word a connect of describe it shaped Not by to markets operate. made our for cases, because re-evaluate continues in a the year great re-invent people of of technology,

like listen network Our a of driven unfolding three the in an first trillion-dollar the environment secular back collaborate have also that of class, March regulation Tradeweb us forward the of month by in in response only multi-year greater. of allowed consecutive changes a adoption classes. months, that volatile our asset say behavioral volatility accelerated all the We to have average in the markets have clients. multi-protocol posted for daily digitization. was the multi-asset with diversity network by solutions XXXX subdued. Fast and XXXX It proven the pandemic of to acceptance the or still $X changes when of we can globally trends multi-sector, by This the have record across daily and trading digitization, generally across trajectory is believe be XX continue never value been started electronification in growing months financial internet be testament that trillion posting which we believe relatively our was induced spectrum. to to its was the and by We catalysts the waves of our exogenous an our Historically, in been global is of clients extremely to and volume the volume more excess electronic and all environment where making. average has of

described new on highs acceleration of another volumes I of across reported we record the as digitization quarter was with our many X, slide display to to just Turning climbing products.

up revenues to Specifically, as our on first record XX.X% were and a resulting XX%. into points basis. on XX million year-on-year The XX.X% translated growth $XXX and year-on-year gross basis improved reported of adjusted constant the XQXX by a revenue during margin profitability scale expanded basis currency EBITDA a record quarter

our marked quarter X, across growth. of our the Turning credit classes more for to was XX% strong this than by slide of revenue asset accounting performance leading with many way

issuance another which quarter rate fuel record quarter, new by the Rates and for quarterly increased environment the yield volume growing electronic and records high posted revenues record set to government revenue drove US credit offset record Money highest its trading, and revenues continues with decline investment Equities grade revenues. new ETFs. a growth headwinds trading. a retail mortgage in fell business Specifically, the as record rate down XX.X% global as XX.X%, our than bank than in market efforts driven and which to year-over-year repo. posted the bond institutional X.X% interest low volatility strong continued were rates central ETF by by hit sensitive share institutional more as sector driven more beyond organic our X.X% gains. more continued wholesale markets business in revenues growth as revenues Swaps offset cash diversify

up Finally, our was Refinitiv growth data and re-distribution X.X% driven market proprietary data by both in license products.

challenging Treasuries, brief a more global me A US interest rate update and our macro provide with growing largest let more main which swaps by credit fastest and to on Starting backdrop X, global ETFs. US slide our organic year relative rate than was last to focus is efforts. rate our offset growth areas; swaps, four on Moving product. interest

attract protocols. and products clients to and introducing led wallet new to overall deepen This and engagement by new volumes client by higher our continue share driving We XX%. swaps growing

both to few a the minutes. share share Longer-term, update an opportunity gain rate in the XX.X% will Billy Bloomberg excited here Clarus. US market to our by we strategy remain increased a you cycle closest we continued swaps by the competitor versus and as As Europe. result, continues market electronify. give measured multi-year to a as We in record and meaningful improves on believe the our

of by US XX% led on that and product to another by volumes US business our of Moving relative Treasury return Treasuries, the institutional wholesale quarter. beneficial records, trajectory continues the support the pushing set institutional to the XX.X% to rates whereas, market. share the was debate to year-on-year rates heavy market to backdrop of wholesale particularly the surrounding The channel, record continues issuance to fourth channel both a the increased of interest

into doing of gains gains institutional versus can by Bloomberg further the capitalizing we wave inroads have T-bill clients short-dated recent existing control, driven what the business, share market, on more issuance. been share competitive on and Focusing

like also versus streaming last volumes Tradeweb+, ahead we rose the adoption year. are Looking here driving of in investing substantially our protocols early-stage

streams session offering, posted quarter. record Treasury on US wholesale which today is centered and trading, another disclosed Our

Following client what efforts leading want technology become off. we streaming a pays clients wins, have and proprietary venue, understand string our lead of new our now as with a to really

In the fixed adoption, to Nasdaq's rapid income believe see important we the protocol. announced which arena, order to we CLOB continue and later will for of competition streams protocol CLOB choice While platform demand central the US to more we book the response client this or acquisition quarter. expect close remain an in limit

complement liquid activity our have As the CLOB. to streaming a ability a result, will their clients with

their We our connectivity will to lower with depth and data. be enhance also data offering costs, of Treasuries book US able

adjusted Tradeweb's we a the earnings EBITDA of we to to or exiting improve two-year immediately EBTDA accretive closing. higher on while As integration margin year period first believe a adjusted being reminder, margins can

Looking deficit Credit, our generating more ahead this to increasingly well earnings inorganic more growing power the initiatives the from interest US emerge environment. continue courtesy to million we volatile Treasuries as mix growth Shifting surge great rate outstanding organic of $XX and bodes ahead, pool another was of quarter for to of ever-expanding Fed's revenues pandemic this we higher believe and year. into and than to an continues business the in our as start the

in my in it's grade And Shareholder amazing progress into being see the XX% encouraging well. wrote recent to high six As in investment as share milestone us now the our journey. made consistently years it's electronic yield letter, see credit, to I hit

focus like spotting, trading redefine to institutional credit AllTrade Our not innovations the on where differentiated portfolio net with trading continue session ReMatch, also like and strongly trading, we with market only approach, other resonating clients. innovations electronic is with entire and but

Looking will strategy Billy an platform ahead, opportunity give continue on you to and business recovers. as to a momentarily. we our of continues in credit the lot as see retail update our scale,

record average US offset wins pullback year-on-year institutional more client as the equities, within Finally, than new substantial volume quarter ETFs & produced activity. ETF in industry with European a daily XX% up

business. excited ETFs quarter, for income continued with about new clients XX% we volume XX%. global of equity to add During prospects comprised remain the and contributing the Fundamentally, our fixed globally the

also expand bearing options, Our with initiatives beyond other flagship fruit ADRs. momentum convertibles, are continuing ETF and equity franchise to in our

product Looking to I trading, passive continued manner from With classes to further most allows client in solution AiEX it CDS, views take product efficient to with across ETFs additions, our going turn that, together recently with index footprint, to enhancements. in set total growth and remain products. macro portfolio globally, ahead, the am and return we we asset swaps, And expanding believe electronic newer clients Billy. benefit well-positioned trading and our an

Billy Hult

Lee. Thanks,

institutional X at brought their Slide look quarter, closer Turning We a on rapid corporate for are by voting continued to have the increasing and growth of Clients driven US record-breaking the to trading innovation a another for Tradeweb. we primarily produced business. market trading our liquidity credit credit. by

has few progress While tide made yield, record about past high turning also the had a the quarter. have in quarters now we where rapid in IG, is the been we

core in market market with business retail improved our middle wholesale important an and where sizes. the also fast-growing curve. contributors. business Conditions were slightly Recall, of yield middle businesses recent is have trade the retail Our in institutional traders smaller steepening important

corporate XXXX, financial advisors still reluctant portfolios. add remain first relative challenged the they as and clients' However, to lower-yielding to quarter their municipal bonds to remain

led credit Looking centered powerful back, the feedback innovation, around a corporate we market, a share creating continues to clients. sterile electronic meaningful when market novel loop, we digital had bring is as for US in set solutions converging strategy competition out by set clear to creating clients strategy and market records. to sectors resonating our credit and with the believe our new our loudly We different

will prices US liquidity to While internationally. in strongly do industry become in with we being we amounts discover XXXX. influencing low potential permanently are pleased Clients for we are market the turning even record sectors, the of AllTrade, traded between $XX to Clients portfolio billion, innovation The trading trading and of of after of protocols of pay TRACE RFQ out with and also latest putting as is technological connecting We believe at tripled estimate quickly we clients the three advantage to speed our over increase execution Behaviorally, to to our hit made soon better. has the items to trading far, to our beginning number all. portfolio is so client trading protocol, all-to-all the game-changing. from we generation network, be and over the new and suite example trading another competition, portfolio of activity surge, believe The behavior. and in-comp the continues liquidity client nearly of X% the last progress have move trade our our $XX billion our protocol bonds has portfolio to record increasing portfolio record. trading, with an large in a XXX% trading. broadest of numbers anonymous volume light globally. Tradeweb XX%. hit new off. The responding growing line in portfolio that also quarter highlighted their demand of show dealers comprises risk quote daily with the versus The trades the rates been now volumes levels. a year and grow solution excess take AiEX portfolio US, bulb have clients than rolling in all key record X% continues year in rates first a to scores average integrate a year-over-year, continues are and improve trading, of X% XXXX attract XXX% In increasingly the which of up in hit increasingly a facilitated credit the certainty big size more by more to investments year. Moreover, regularly record. next trades and both Session next today functionality AllTrade

unmatched Our as our matched session well in by end the offsetting but inquiries newest all-to-all which to encouraging. its at has innovation a be been platform rollout, ReMatch, enables still as retail liquidity, is early wholesale institutional the progress by of

advances a existing spotting onboarding pipeline We offering out another $XXX over record hedging also our functionality. savings, the advanced quarter, further This spotting across saw dealers, Our up strong clients the generally only and multiclient be year our enhancing to trading Clients efficiency. of today offering we clients. net spotting able in against billion lead over we at net now with but year. with iteration basic of are net XX% offering fourth their will volume, and our time, and net is quarter first believe in which across rolled operational the activity competitors believe extends that spotting other offering, same not our

Turning of strategic and achieved the our our business. to lies our diversity of advantages believe bonds European We record credit, munis. in of We across set. China the institutional revenues product rest one credit

that by strong over we fell strongest subsided our year. with Our year product record, driving We higher CDS sovereign share levels the on our second our set XX% on in last from business extraordinary expanding its focused single-name though posted saw volatility CDS. as quarter year remain EM volumes growth and

to clients expanded electronic offering first-ever has sum, just across and recently our believe credit innovation markets. total road our product a In efficiency needed swap another to to collaborating iBox an with credit us the our ecosystem. transparency the lead We bring is room market have of with fixed exciting example we trade. growth map we return income for business tremendous and also This the

We are their and find liquidity protocols a execution with objectives. arming to traders across marketplace optimize of variety intelligently the

to swaps, swaps. low results. another lower more volumes volatility about growth the success quarter the then share remarkable the which a hallmark become driven been This continued volumes at record culture. market accomplishment Variable with overnight quarter supportive. XX% in were The XX%, first couldn't revenues light is of a of a year multiyear in XX.X% swaps Moving fee X% industry has index from environment by a driven The were lower year-over-year. down back The when is quarter, by Tradeweb climbing team example story on the primarily last year. record industry by first to decline grew rate volatility and nonstop have innovation last in by per our pressured that interest million OIS. of The in the

of has XXXX. injected into yield and has the returned of inflation curve, debate the fourth relative to life the volumes shape quarter expectations client However, regarding which

about across few talked Over our by market control, we in last calls, protocols and on innovating focusing the products, driving geographies. to things higher share specifically expand have

X.X%. record gains and of Our from across our share to was core main market FRAs within our and FRAs, focus, combined driven IRS XX% IRS, market share core by rose where

the market, growth rates We of protocols. reference or and changes new the transition continue introducing structural clearing to alternative the in to swaps it by swaps to products be innovate responding EM and

continue attack LCH last the quarter, versus and to swap added as week, In executed IRS swap cross-currency EM bond automated in we first futures agent activity, trade. first RFM fact, swap saw opportunity. the record Brazilian we And first growing the we and the electronic EM at euro

the to way market the and recall that truly its a done was in that's the considerable quickly markets amount to corporate and and when while to And today. approximately XX% income last a still continues market the a This market rates at electronic via grow. the after on go and ahead, business to government to manual bonds opportunity. broader big Since remains market was well being Innovating swaps then, markets electronic. Looking only digitize market has flow swap TBA years the ago few voice, our fixed started way. a global electronified of time credit happened more meaningful

credit the continue AiEX. especially a by comfortable with our automate on XX% we automated let This Finally, in Clients increasingly capability, is key will comes data-driven really of series number can to across Bob clients it trades as over trading Adoption touch financials we in trade, to leading and And they client grew they to performance clients that, quarter fine to invest usage trading counterparties to with me believe love with it of able counterparty with to metrics the and increase more record resonating more rates, trades their intelligence and equities. low and discuss it as use to trades with continue of clients. turn continues their provide, to tune strategies. assess increasingly And of as AiEX more The to automation, AiEX managing selection. comfortable relationships. first complex no more focus become their year-over-year that detail. our when the get is Post in trading.

Bob Warshaw

Thanks, Billy, and good morning.

to through the go the prior-year I numbers, As comparisons otherwise all noted. period be will unless

of reported summary and US earnings European first trillion, excluding XX mortgages, quarterly quarterly institutional into monthly our and XX.X% the European European The in me and highest reported we revenues XX on average growth corporate gross report, a on up quarterly basis. customers of XX.X% recall credit, Let volumes revenues Chinese ADV. in Slide records, We second their on activity publicly revenue XX% currencies performance. of volume government while achieved $X translated other five provides quarterly by Among another include bonds, our swaps. of from US an both percent hit quarter categories that approximately volumes Slide notable excess disclosed repo. ETFs XX%, our short-tenor Areas international record daily and and including with record increasing than in our and XX% in X. begin constant-currency approximately product a overview We of predominantly euros. of dollars, base is our derived that XX bonds, denominated

in proprietary Other revenue trading major periodic primarily X.X% related due margin of by performed growth in increased revenues for XX.X%, Credit revenues by of quarter and FX. variable from increased in additional total data retail dealers Refinitiv by primarily driven grow, of at were fixed and XX% enhancements we basis. points increased scale. on Equities revenue constant-currency a driven tied up All-in, nicely was growth Our to we by share XX revenues reported and to Total fixed clients relative income $X.XX. four and expanded a impact our XXXX adjusted X.X% was the data benefit revenues credit record by revenue the classes by diluted products. XX.X%, per fixed to and technology trading our dealers driven Adjusted bonds. the of clients. X.X% our basis addition continued first of new to as XX.X%. in up new US net addition Market to growth Chinese by came asset continue EBITDA to

a blended growth per fee of to within slide X%, result credit one-year higher describe our various are I'm fee four primarily increased sum, and greater as Moving by swaps, The ETFs. per on institutional our million million trends driven products stronger mix In million asset to about than per XX. in of a classes. fees on

swaps was our per million million per and fee up Excluding X%. lower futures, fee short-tenor blended

Starting million X% underlying with review rates Average up by rates. was Let's trends per for fees overall. class. the asset

which treasuries bonds US carry fees was the For cash products, fee lower fee flat was growth in per higher win offset government as and by longer-dated, rates which include million. per growth in mortgages, TBAs, institutional a million

compared growth was in than credit. fees rate services, swaps, In to higher to fee Average credit due international corporate Drilling both clients, overnight million cash per per and a million index fee growth emerging such million a million volatile carry of US other For rates Continuing primarily in increased average fee growth saw than futures per increased up per while in for down in high due US XX%, on to per million quarter grade cash fee US overall increased to average XX% swaps. million and X% and very XXXX. fee which carry yield, market credit, long higher which frauds, activity tenor as swaps cash due million credit stronger European credit. a per swaps, million per per to record first which includes and as lower bonds, high RFM. higher projects, short-tenor CDS declined XX%, fee fee volumes,

higher processed derivatives, credit million overall. by US with fee Average million driven processed per increased US derivatives the Looking cash carries credit than at X% million credit per electronically average. up high-grade growth in category, which Continuing per X%, fee equities. volume, for the fee was equities a electronic the

million decreased convertibles, to This US by average For per equities, per traded. within in due average. per per US, trade million traded. and notional average higher in derivatives' fleeting fee derivatives fee fee increased X% decline we a values rising million not the a which fee in driven asset growth the in equity by X% ETFs. Recall, cash million European was notional due carry for to Equity per value charge than

than and continue approximately for decreased quarter on for for been base XX.X% expense expenses our Recall, X.X% here. sterling. currencies repo, driven a markets, which basis. per Adjusted million There denominated money repo grow. and has no reached level, within constant-currency activity fee than predominantly philosophy was million to carries high decreased lower of remained to growth. dollars, rate money our per a record other is Finally, environment. market Retail institutional markets Slide change XX the we growth continues XX%. by in details a in low other our primarily expenses. XX% pressured mining by interest levels products. This At in Institutional invest first fee

XXXX to Compensation fees, First XXXX quarter lower and were were compared which by costs expenses due G&A higher to technology compensation, first headcount and as XX.X% operating higher to G&A. increased professional to employee a adjusted compensation increased communication, as FX. in offset taxes. due quarter technology communications primarily performance-related non-comp expense reported and higher non-comp on XX% Adjusted basis, as basis, and on constant-currency increased Adjusted by movements expense, well X.X%. a increased payroll-related due and unfavorable partially

communication Specifically, costs primarily to bid clearing fees technology due a streaming higher values, credit higher result and AllTrade and in US increased Treasury and volumes grow. of as which continue to

this and investment fees communicated increased quarter due and saw FX increased balances. or first increased the general due first quarter gain strategy expense. the decreased less quarter Recall, impact and we XX.X% $X.X to strategy a continued a Professional realized details fees $X.X addition, our In XX.X%, and million data XX in data in XXXX. and investments also travel of our our entertainment impact resulted to unrealized XXXX out Slide adjust hedging FX, of infrastructure. to a even technology. FX management in losses constant-currency gains realized our consulting and cash million primarily movements capital loss on previously guidance. in in versus G&A on administrative which Adjusted in infrastructure basis unfavorable related

XX million months. strong in holding flow and cash cash position, our on capital and quarter $XXX cash We free equivalents, return position ended the and cash trailing a First, reached policy. million $XXX in for first

year-over-year CapEx the million, investment a development undrawn $XX.X for quarter to software primarily revolver capitalized to million was quarter and as due $XXX that an remains increase spend. of of timing access have of We end. XX%

capitalized continue to for expect the We capital the and $XX software be $XX million full to million year. range to expenditures in of

per declared Class between quarter We in board Class quarter's quarterly the final not earnings, Within B the share. and of of $X.XX shares a the did approval the and any implementation. A repurchase dividend because lag

begin the expect to quarter. in second to We plan

we plan As share grants. annual to reminder, million primarily $XXX which repurchase use authorized a equity we a to us program

to guidance Turning XXXX. for other items

million our to adjusted range million higher previous of XXXX. trend half $XXX expect the for We $XXX in to expenses

this to continue to end operating drive margin at XXXX can expansion We of believe we either compared range.

continue we non-GAAP for For to forecasting purposes, assumed year. rate XX% the tax of an use

to updated on we share you XX, our XXXX calibrate fluctuations for in have Slide for price. sensitivity help Finally, our your share count models quarterly

it turn remarks. to Lee I'll concluding for back Now,

Lee Olesky

subdued, growth. environment Bob. powering remains The Thanks, class The volume increases diversity of institutional and remain We revenues strong especially intact. and operating share asset equities. retail, and trends secular regional drive automation display gains for rates full believe product electronification organic across the continue still quarter with was another yet and market our to multiyear credit, on

money growth connect innovate to and the deepen sectors, macro this to both levers well customers. continues that progress. participate of the believe our is challenges, positions noted network While dots multiple We have we protocols, markets despite regions, and diversity us as different the in between asset classes, it and lead next generation

to cash left volumes XXXX. has With month-end April continued first quarter relative with further opportunities augment from position. continue and days believe evaluating double NASDAQ and income digits we a M&A to important the that spend in would time network, trading our given fixed announced growth our potential of acquisition, organic April, our to couple addition revenues momentum previously In we overall up

We and interest investment-grade high-yield across AllTrade. seeing credit. market revenue credit global running portfolio swaps rate strong are growth Both across trading last and higher electronic shares notable corporate quarter strength than with are and the

Hughes and welcome of Von like our board I to I Roos Before conclude, Murray would to directors.

that, team. like board their to your the back as experience management by partnership that questions. conclude to will Tradeweb. and be at We I'll remarks efforts immensely thanking they revenues and the business voices helpful in colleagues are our our for their clients Ashley quarterly we the contributed With leverage I'd for excited quarter, to my and and operators to my believe to want and to thank and strategists, record and volumes turn I it for their

Ashley Serrao

Lee. Thanks,

back to one queue question. only. now our into end hop and first end. Operator, at you the ask to yourself limit Feel a.m. can please question Eastern reminder a take As will questions additional XX:XX free Time. Q&A at

Operator

from from our And Thank Harris Chris first you. comes Wells question Fargo.

Your open. line is

Chris Harris

guys. Thanks,

very related think like macro solid growth you of on market? think an aside digitization of for is, to fixed might where interest obviously can this of the So, we be another normalized rates? give update What inning business with And growth that, you income putting of an the level respect us factors the quarter of terms you in do Tradeweb. maybe to

Lee Olesky

I'll Chris, Okay. It's question. good one. one. that take for a the Thanks,

better - to indicator cost. double-digit a average many our about in they by drive the currently our cycles last think, continuing look, critical. of growth customers our asset with look for providing powering of think and best That's years where their the have of though, the us we really respond I revenue that the changes you we've unearth across reduce are than improve network behavior changes growth years is that on to when innovation us, the over our with It's as most to The of to where XX this, reality really about new intact and workflow many, be the all growth them opportunities responding to class. tools The at and creativity, working think respond for to we're really, drive and I client culture different is allows answer when real thing, delivered the drivers history will around the important across we've to built their - secular world. that headed. that

more eyes. happening mean I before had in markets year's last than this quarter first volatility year environment extraordinary. subdued acceleration We a an in was financial record-breaking quite our the relatively was where right first the the quarter. digitization of So is

in to our increase gains, also this is these function us execution share and a of our a allows broader market So get electronification. innovation but that

the US just the XXX year. last basis basis points even at points the IG activity And first look or High growth. of quarter. so over points swaps, sector, first growth XXX of from you in basis XXX quarter XXX, up more, electronic if is yields, that's of electronification Now, from

the of We've market, a change. account IG, more of have still electronic main these that allowed one growing. accelerating our pie have from bit. is to our In phone. us behavioral on behavior believe of has competitors suggest in for gone believe trend. forefront swaps changing innovations electronic. and We We we trends the than half perhaps the success been incremental the of firmly the this multiyear percentages a is So is this The as the is

business more parts are there's will in and lead to many so advances innovation for that more electronic that execution. our more So technology primed of

credit, just at the we're with recent that current Net look you in with RFMs out were If with RFQ and solutions cutting innovations, ReMatch in some repo doing edge on great protocols of success with IRS, and we've trading, we that. our the we've portfolio that, first had and things streaming spotting, equities. the ones got treasuries,

to new feel the and going we the more world believe That's going And with kind of work we is a It's importance changing So is working satellite like era. offices. employees to amplify this home from technology a a point. efficiency. flexible be environment and new of real

the is real opportunities we're broaden So, our opportunities. very to excited that, of up ahead to about marketing and engaged. Salesforce the We're network, ramping lots of us. expenditure further

I so class what are So, the depending world are the where asset is. the don't different you on and in in innings innings, know,

so fifth the along perhaps are maybe the the products inning, into space the and going So electronics, inning, XX% certain credit, further even along, the treasury electronics, inning. know, know, or at IRS Swaps even in is right. I furthest fourth only third but market second don't that's inning. earlier, third DXC that's, inning. I IG fourth so rates is don't only is XX%

the you it class. in asset on in So depends and where are world really the

Operator

comes And from Suisse. our question Thank Ari next Credit from you. Ghosh

is line Your open.

Ari Ghosh

everyone. morning, Good Hey.

the So maybe one for business. mortgage Billy on

business in growth records and rate growing around bit environment, last XQ in mortgage year, other done a setting have been muted X% more a really low new recently, but well products. So lagging volumes the in has

we Billy, rising So, business? think the how mortgage about yields should just Thanks much. so impact of Tradeweb's on

Billy Hult

you? sort of Hey, Sure. How I'm this chuckle to and question. the date with Good make myself Lee at of time. kind same Ari. going are

And an think strong we've and and I a had really moment that the on from in market been industry leader like very back have early when. Tradeweb strong the was to very business. third got attached like it a share that second business space brand mortgage way or into

business kind us, business the just specified always quarter trading, was on strong It's the Lee's a really good unique general. like things volume. us. different different strong customers for really on? just types for I bit convexity stuff a in of trading in with how do mortgage on? The your a in initiatives market it's do about of highlights around all we to right? with users and our So quarter a of the really was with specifically think right for I us different was of would good where lots What have we of going has happened I perform quarter not Do record It when around little is Ari; a happening bulk the in mortgage is in we have right? because about the around will lot myself good us, of good new network, always settings, are the the Do volatility pool so kind highlight you first companies settings, to point, the activity, customers right have of market. happening. interesting There mortgage ask

So come typically from rate volumes originators. very mortgage low

that there's You value of a the that the environment, enter delta different right. fray, relative customers to get There's guys get know managers trades, active. types well. hedging, higher asset you tend more can In yield

there's variety in there's rate rising we in And from the environment. So in that a thing is around way moment a a at can rate environment low long but confident perform a feel a business day We the would that's the mortgages. network a of I high rate things will that just low add end different we other control, environment, this wonderful settings. and have of really

kind keep the we you to always where question, have in are for So Ari. And yield of in we thank your perspective. curve

Operator

you. Thank

comes question Rich Sandler. Our from next Repetto from Piper

Your line is open.

Rich Repetto

Yeah. and know starter, is this. Good reliever, all thanks whether the analogies. closer, for want I Billy morning, long to Lee the the baseball the

of I them. all think he's

Billy Hult

You can after. tell us

Rich Repetto

calls and an electronic last the basis or last different investing like passive my of ongoing these all trading even time highlighted portfolio whether you've it's Hey. question on quarter. sort Anyway, is over the - digitization efforts making you're

new not least guess different bit it's there's it AllTrade more to session-based I bit, just all-to-all or question me. quarter, was all-to-all the at to trading, seems well. - all, the little your at And it AllTrade all least of the a has like it, platforms a as in This a couple is, this and ReMatch

it at the now whether is any then it guess last all-to-all taking you're if the have was liquidity it two this something have bringing all-to-all. second year, just in Do appear in customers And up into environment? all-to-all from much you're related on still like of like pretty would I is environment. from credit, that hold had you automated questions if there say, market this peer, to more I point, - we So correct, is doesn't other share trading your enough

Lee Olesky

Yeah.

saying me by he let is off play just can start position. an any athlete, So Billy amazing

think responds different serve So of I off strategy wouldn't him is in. I'll well dots the lots kick could been as at jump and free really doing connect demand. of customer customer feel market sort whole to what tools on the to put different of us and we've in keep him we technology to if base look, with Billy, pitcher, going continue even it to this I segments in to. third linking we need it Yeah,

of a, bringing in is we're there our or I see of guess enough what functionality, yes is - that tools liquidity, and will b, scope there's is always right. answer terms whether we're network there be here to another look but different bear; really at and - to to not the the So the I to in a the response well, starting crisis, but think

the all-to-all particularly and So as talking we're attracting different more tools offering. about and more we're credit customers, we're of when a result

RFQ linking institutional. in did we're So doing or portfolio with previously session-based into we or into trading responding trading whether what retail it's to what

that Now respect liquidity. somewhat will wholesale of think We any retail together in with different with assist institutional got stress we've time linked waterfalls. all sort advances these to of

all to price. an it's these broad the to be in our to bring clients you customers that's arms market system use network, race of kind an the of of bit liquidity. very attractive tools the a for the at together same expansive needs. that's into efficient And time, we're then search and in And is battle So to as you're bear a this terms can of technology going a going attract apply innovation customer to to responding at to stitching I be having doing. for kind very mean nicely. them tool of We're the what that about and

we the So several is kind right. positioned I been lot grow. well And further over go really, proof and at is proof pudding, that. wanted years in to - the a back numbers last we've since board think we're the the for to, you of in very public. And the see you Look could the if continue just that across

positive great with March performed Thanks, really not Rich. pleased first market, situations. very and been Fed, and extent riding the about we've very the handle and in in situation It just we out just the but I we're So us, was being Fed, we're last dealt the in of different unprecedented with year, a was to things help really kind things. of help whole mean challenging big able so those accelerating how couple to just of the with fact, quite of kind obviously, well. months, the storm Yeah. of

Operator

you. Thank

Our from from next Sachs. Blostein comes Goldman question Alex

Your line is open.

Alex Blostein

spend portfolio quarter contributor be for credit from around to Hey, IG was continues I from definitely - first Good to to and April Thanks from quarter. the market on more and high-yield growth. share sounds to trading a morning couple the guys. hear good everybody. in encouraging up last as minutes like question. It well your taking that hoping a comments

dig contribution was of features a offering It portfolio you what of spend minute I versus little can bit relative bit more. your well? training growing. we've Obviously, And trading differentiated But in to others. could more to So the momentum of the industry-wide with sense then sort a hoping that into from seen on Thanks. it's little competition? a momentum any terms portfolio in as help that us you from seems we've getting revenue seen like

Billy Hult

to gave they we highlighting actual we're like about out customers workflow, care saving because kind around I moment in And a way, I do to this. in just build we not a of protective our has money would to it's guys most is, the of this has of well, the customer. we result think around listen, complex absolutely of good obviously, I way the but say slightly sort very would was portfolio do inherent specific early And of be technocrat, that sort were think important trading. becoming end clients' And word of time. particularly efficiency. how and of trading I to on and we around workflow the great, which it Yes, sort understand of market. workflow, They it. really about the mentioned, and paid can just Lee environment I the reality about that It's sort through that in of change something from kind specific differently think kind care Billy. saving is portfolio the And trading that's care about? going so highlight right. of care principles one It's what significant arrived Alex. And period. particularly of important you very, first also are Portfolio Instead a attention like very is functionality, would the very like with around the what complex. just sort a it. Hey, They to - kind of us we And simplified fundamentally resonated I in, and advantage a

Lee Olesky

the just from - the would it, the would time, everything innovations emphasize iterative, improve, Billy I about point, beginning, just you just you really just but you right? are most which of done we've improve. I redo, And So mean, Yes. very last is, our nailed I

places, portfolio our, lot I on It's already. putting complex. this Billy We're this great a that just but on portfolio as technology first know, And being the and is We've being important. is example. enhancements So of it out. other And umpteenth a of don't multiyear super said, done that. is to a a version of great we're effort is deliver example in able then

remember but enhancing like, first it So we it number we the then what super are now, to XXX, and trade. we're to Then know improving just grow. getting XXX even continues okay, really don't the when complex make it let's I right for off, was constantly tweaking that's making started to it stuff that is and up I have functionality sure it you're the was portfolio bonds list was and in more it And that XXX, right important. user-friendly.

Bob Warshaw

And seen Lee, is thing, in the over changes trading, I'd comp, it which we've big just last now much in now years the starting how add portfolio of one is is two-thirds from one of other of two in it comp, years ago, two is XX%.

helped it's fee price as on side of a trade So purpose. that's that important per a million. more used income there's because sort matter the discovery going portfolio have for higher it being means of And us slightly and lot incredibly

of how clients terms and of it's its and what sort on used it's do. good all are able revenues impact in being on to So

Lee Olesky

point Yeah. Bob. That's great a

Operator

Thank you.

from Alex from comes UBS. question next Our Kramm

Your open. line is

Alex Kramm

Yeah. Hey, everyone. good morning

certain opportunities? a of that traction that Maybe bit. made that gaining you've largest and there to Thank around missing the lot the traction, there's a that Just is question make types topic untapped maybe clients, you and can credit not war doing? talk to would else or it actually to marketplace certain and the where about certain that's course, somebody something see sales about you. is you're anything or Is sense that, of in is - efforts it else add then, inorganically chest? doing there just trades, so Clearly, the you're But little help having turning of staying area us of the actually on maybe exciting. maybe where you regions, still of that's related

Billy Hult

When we're think real that We're competing lot, and credit. there's the through our showing about you market share in competing competition. never area have anything a work you we're credit. right. don't I really on, this wants where guys an market gains force compete, And a in you We we're talked else to

are to always of and trying we're how So out improve. spots can soft figure our we what kind

the high success, we're an of risk kind as - important And yield. I we Alex's get a trades, are big of we real where I of the high or become of probably we've areas highlight very realities obviously, think trading a it's in right. kind one the maybe bit but is improvements, lot think transfer and would question, we've a around some stronger area can I Alex's little mechanism that had the one of kind after even to I portfolio recent real always And think like yield made feel now. back of block point one of

getting sort talk the more And And business singular is is these how so going always our of lot about we after we we focus I coming and that think of a thing are way. block trades how around credit. that our voice kind are

Operator

Thank you.

J.P. Our next from question comes Worthington from Morgan. Ken

line Your is open.

Ken Worthington

good morning. Hi, Yeah.

this So clients? trading? talk talk can actually, big success you. emerging is And you how is the Maybe about the about markets, I with moving - most think, grow what be point? a ball relative to continues the to resonating market at emerging EM building for business the broader you had China, priority you've forward on Can success in to

Lee Olesky

we data We've We've that derivatives of coming as made. and The and great We making we where in strength things the of emerging continue opportunity, has for been there. - kind company a see runs Thanks side just out been Sun's we minority some co, Ken. hires who we've made Sun, on Sure. of to that, markets investments hit some the obviously Shanghai. China started growth China. a James the see that out our very really for to Look, in second. - area. We large of investment hired business announced with

that reporting we instituting the So on are in types and trades new you we're investing see of us space.

You've China side. the got

derivative You've the side. got

opening into. You've and us, side, we're is which energy studying got which and putting for the time cash an more

strength doing see geographic in diversity us things on lot derivatives, the we which with technology, but a you'll opportunity it So that the have. into see tapping we network, at of EM, is clever strengths, in some coming our

access domestic area. the we're I least. exciting into out ago we've the had That I into of growth steady pretty so at unique. allowing or firm think actually China, was, We market already coming years And don't first know, were there. that, three so

Ken you'll a us that in great about from be I area it's think future. the question hearing an in more

Operator

you. Thank

comes next Michael Morgan Our from question Cyprys Stanley. from

open. Your is line

Michael Cyprys

Hey, good question. morning. taking the Thanks for

the curious outlook muni to your be Just hear market. on

thinking there? make institutional, think for you if And Just you munis as the in right. opportunity your how set business, I'm retail than you're I can new sense? about protocols we that Any at is market business look think bigger muni

So guess you're how the be the color just channels retail side and pools navigating and on have bringing that together would different helpful the any liquidity institutional from different I needs.

Billy Hult

Yeah.

old still market, it's kind is of So market - old of just kind really still bit the really April it's in kind little XXXX, muni of a kind of - school, right. school of

in a more a of kind that lot engagement the feels role obviously, play we're and we institutional business. we like feel retail been, around, markets. kind a has to our electronified this how like we've That around And in the munis other business, muni so right conversation wholesale there good position have your And a question, because real munis really lot of around platform? muni is time a

we that right what absolutely this There kind And we're bit the the so of developments do of we business well, kind kind the different edge of a after external next collaborate kind with which the the a of now. figure of business which the kind really space sitting little be engagement always signs kind out we is this going something way. go we've always or look done muni these historically kind gives as to in for. the direction going going to real this push kind munis little back this think, is have again, we our us And retail we're community, wholesale point kind I in are with that not strong we on moment step side, of that interesting are of and lead in that the some is community fact of is and are pointing forward. fact to that kind bit. And of, to is collaboration The business do in whether a of of,

Operator

you. Thank

from next Our question Dan Fannon Jefferies. comes from

open. is Your line

Dan Fannon

about is continue revenues. adds question of grow to new They the customer you My a Thanks. talk across on kind businesses. fixed host of and your

sense we about the as So this trying the get and that? a fixed the to of how just of should growth of think we outlook about year, kind trajectory think revenue,

Bob Warshaw

slightly the components, really our two as some determine as area, are expect way certain and that new components growth about of fixed make let adding from is comes And we several related kind clients have single see particular in that between cases, revenues to choices and they variable changing There it, comes their One of new and that, in to that products, we minimums. sort works can it lower with consistent a dealers, parts. so digits. year-over-year, me And some big trading to which they mix the continue, been associated talk fixed has businesses. in for sometimes of the to

it. of side trading the that's So

that the so that our And and digits we is, information of about is expect included in think adding to our kind to projections related information about thinking continuing investing Refinitiv customers and and to think contract of services, it some there, key growth big you're we be expenses. to product services, are that to that things thing short we of add these area piece The to all to in investment mid-single in for on is is a really are a when have, part. contribute And in reporting particularly that's Europe, I it. all the parts other other in at in least our more the piece new also IT term, of growth the also the the

of this in important that's focusing So operating we're area. how and are sort it's the because we part at business all of point, that

both been somewhat pieces seeing with those what in two it's you've and So cases. consistent

Operator

Thank you.

comes question next Our from Kyle from KBW. Voigt

line open. is Your

Kyle Voigt

Hi. Good morning.

of related secondly, And think market versus the any seeing is to from shifts you think were trading that was prepared gaining If then Bloomberg, market what that to relative do Bloomberg? year-on-year. Thank benefit Bloomberg us your that we look X.X% proposed changes the specifically. XX.X% market, in from versus you share just about share mentioned at gains you at voice share to frame it related Could of to more think electronification you. You IRS help remarks proportion broadly brokerage? you're I fee

Lee Olesky

me take Kyle. that, Yeah, crack let the Thanks a at for question.

holistically, quarter significant at I go of at back had so quarter XXX IRS, about just think, just first context, growth, it XX%, we to put electronic basis XX% If about percentage of points. let's we 'XX. say we first days, these pretty 'XX, so

it's historically. market is, the have we our we're talk but this do but we're pointed coming pricing So and we a because down up to numbers, there. at publicly wouldn't We're a on also our we're classes what as nail picking is that's to electronification, we it's up exact life the we're comments lot electronic, more I that's number majority think one of tough stuff, don't there. picking movement the and we've there. look meaningful of cycle out know the component up recorded so so a disclosed And can always depending gaining not - competitor. comment the hard had a of at growth share and that's you - think picking in big that whether - all asset that's on I where our

of critical. to interface, because it's first se responsiveness. and the been price. is space, to desire in liquidity, all clients say that think functionality, And find innovation. per best foremost, our said this I about think to are I main the respect to to our with time swap fee-based The thing we've in always a possible down the because system before. way efficiency, it's It's the I efficiency. but leading wouldn't Billy costs come addition

mindful to First that cost, in quarter. of the see base that, we've we're liquidity, big, the efficiency and costs, customer that well time, and results you from we big reducing first so across played and our think had those very I can foremost, are as issues

Operator

you. Thank

Our comes Deutsche next from question from Brian Bedell Bank.

Your line open. is

Brian Bedell

folks. Thanks. call XX:XX. Thanks past Appreciate letting for Good morning, the go it.

on can on credit to I know but Just lot answered XQ if these A talk of a spotting asked XQ, and just were one. the XQ. that. credit and shares been lot contribution of underneath net overall different in dynamics XQ that and you real have quick about then flat the to there's a going

expect you improve, being improves about that contribution the to - trading major just so XQ, talked XQ mentioned your in behind about out. And Billy, that? spotting so spotting into XQ? into then, think, generation share that do rolled you portfolio talk credit net I the April trading as You in a versus mentioned, is is given next all of force but And April, net maybe and you from the

Billy Hult

feel franchise, it. that about is done. the workflow the And accomplishes right, Yeah, it like kind kind lot sinks gives much of our biggest were like of where a And before, the absolutely and we of moat around both get and participants save We feel so of with those about this, like comfort it's money. me we pricing engine what what around to feel strongly critical, channels exactly asked is the the kind just obviously, your talking in absolutely which time, we've market. like because it competitive we things. we in into really is rates save Obviously, absolutely me credibility

feel significant. Thank of makes And as ago, fundamentally statement, credit it feel something absolutely first an confident strong accomplished is as component we biggest did a we the of about XX Brain. marketplace. guys It kind you you, when we really. or this months about a important So to in that's consumers and talking like it critical us and ago kind with the functionality year started we've

Operator

Thank you.

from Sean Our next Horgan question comes from Rosenblatt Securities.

Your line is open.

Sean Horgan

more Thanks market market seeing on And taking the you morning. on I think one us Good already question. Where are growth. of I you touched you Can guys. things. update Hi, an had year give for a just my side data ago? solutions? on traction versus data

there So great. would anything more be

Lee Olesky

I'll stab that. at Sean. a take Hi,

much getting for we've data we're question. on with an the a that that a the focus we're Yeah, I that that own the of combination way also light standpoint agreement area the going. more essential, got We market work-from-home with from us proprietary is data opportunity. our Thanks delivering worn market electronification becomes environment, especially think think, of doing is of and the redistribution to our just is for out. everyone growth in market. just things look, of the It's real but Refinitiv out

about So of data market can terms started our enhance we experience in the with we've clients thinking how execution. for this journey

so on focuses of across the and in prices now that bonds in the at got spectrum, actually other thousands we've obviously, of tens driving AI on. now pricing, So implementing we're and areas we're looking credit different

we focusing We're we have prices. on So closing think opportunity there.

So we've number launched and on with the partnership activity closing, in occurs just where and price. got establish a so that's prices we've increasing. different closing initiatives of ourselves to There's that closing much that firms

both and focus. So little year. We've place also over of a side We've on look, got a product and talent invested the overall, in area science tremendous it's the new the data a in now big tech for recruited some side, there leadership leadership side.

the people a of the who's month that's spent actually reminded one office. probably I'm in about Although only

in along I So of been to mentioned. we two Yeah, one what exciting that and I setting. growth those kind continued expect an it's remote accomplish area to we've amazing able lines it's where have this think

Operator

Olesky that And remarks. conference. does over closing you. for any back Thank question-and-answer like session conclude turn for the the now today's call I'd to to Lee

Lee Olesky

you. Thank

you the just rest out a say if front anyone joining Ashley note. team. me or quickly free remain the very us. thanks, year strong We tackling for have excited follow-up the any opportunities Let the feel And to of us and in of please We obviously, 'XX morning. on reach multiyear this to about on started everyone questions,

us lot to look we Thanks. a quarter. you joining forward thanks next and So talking for to

Billy Hult

you. Thank

Operator

may Thank a you Everyone, day. call. conference now have this for participation wonderful you your gentlemen, today's Ladies and concludes disconnect. and

Tradeweb Markets (TW) 3 May 212021 Q1 Earnings call transcript