TW - Earnings call transcript Q4 2024

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Operator

Good morning, and welcome to Tradeweb's Fourth Quarter 2024 Earnings Conference Call.

As a reminder, today's call is being recorded and will be available for playback. To begin, I will turn the call over to Head of Treasury, FP&A and Investor Relations, Ashley Serrao. Please go ahead.

Ashley Serrao

Thank you, and good morning.

who the our our growth business our Sara for who Billy initiatives; today financial CFO, review our will results Furber, me call CEO, are Hult, and results. Joining review will and key and during We to that of material and intend within this certain expectations, our obligations statements nonpublic means like future FD. I'd and with disclosing under complying in Reform to Regulation the constitute website the and Act to such, a relate forward-looking the meaning disclosure XXXX. the use events Private Q&A as may information Litigation remind Securities as presentation of you statements of other Statements among things, related guidance are to, forward-looking statements. our these materially may Actual statements. results from forward-looking differ forward-looking and contained earnings Information earnings release, reports statements periodic our concerning SEC. that differ is cause factors in presentation, could with actual filed the results from to

reference today's earnings is regarding including measures industry industry sources Information in regarding will In these certain data presentation. market measures our addition, in well we GAAP market measures, certain presentation. on including Information as and to earnings is data. non-GAAP non-GAAP and call, earnings as release reconciliations our

Now me turn over the Billy. let to call

William Hult

Ashley. you our quarter of in our for call. and everyone, fourth the proud Good that the I'm year joining extremely helped team and quarter morning, earnings Tradeweb produce Thanks, revenue thank best history.

across in continued As and I IPO look have doubled share upon we to gains growth. market We past, with and as accelerate than ecosystem, our free back flow. was to across want honor expand products. the our more as debate it our our at and income our culture, XXXX, build XXXX, revenue our diligently more healthy tripled core Since scrappy EPS adjusted filled fixed revenues than our continue well our presence quarterly that cash

innovation with strike is company to with remembering of to liquidity most our efficiently by connecting technology market only electronifying buy-side XXXX, side equities. always but a Central where our focus core strategy developed benefits clients. markets their credit, not the balance our clients important are globally helps money We providers. and buy footprint rates, also the right our In dealer across expanded the we markets,

to $XX rating EM We in inroads markets, revenues now over at continue make and into run million are annually. we also emerging

client have deepened rXfin acquisitions corporate years with and our we something Additionally, space expanded we and for our believe pay Yieldbroker collectively with relationships into and will of to ICD, treasury the dividends come. moved

Looking gains Strong to XX.X% fourth network. Diving ahead, our we reported and flags share multi-asset growth plant the continue and on risk-on client opportunities into activity, environment a X. basis. a more Slide on to deepen revenue drove evaluate more quarter year-over-year

to growth as continue balance investing EBITDA XX margins. fourth margins points relative year quarter expanded profitability to and the We by full XXXX for adjusted basis

to X. Turning Slide

by high electronic second market global quarter, the led rXfin by quarterly derivatives double-digit yield further equity repos. global across led across addition global revenues derivatives. Money and business. was and credit and posted markets ICD market growth, fully record the and in by record by high-grade of across revenue aided Equities supported ETF led our addition continued record with U.S. share was growth share bonds, and by driven business bonds our strength corporate also mortgages electronic in Our was and revenue government of growth by fully and U.S. Credit European a swaps, highest across rates and produced organic across supplemented quarterly by Yieldbroker. growth

data by data revenues LSEG, growth and in market contract, products. data market driven were our Finally, proprietary

Slide X. Turning to

of XX margin adjusted growth. translated most line off results asset revenue record adjusted classes Our EPS XX% our year into Record a expansion record The EBITDA basis. revenue top generated XXXX. fourth points volumes basis quarter by capped reported growth across on drove a XX% scale in and strong

our existing adding of tradition As new we we new enhanced and scale, partnerships. to clients constant focused continue product our our capabilities, maintain initiatives investment. Broadly, growth forged and

the On pool global rolled across specified and Yieldbroker, and our completed out meaningful we progress rXfin we our mortgage and of Edge platform, credit. offering made integration our capability front, new RFQ

to as largest we clients. mortgage we side, and our client with scale our platform inroads swaps continue make credit the On

made Finally, on BlackRock's of meaningful progress the and the with our on collaboration with phase Aladdin integration FTSE indices. front, our we second expanded partnership

well we our Digital the future with We for for and investments another also helped Goldman make but positioned the became XXXX GS Exchange. have banner Additionally, a Platform year first not new strategic believe Tradeweb. Stock partnership Sachs's partner Tokyo Assets only announced us for the

hard Moving years to for worked growth we revenue Slide X. that have continued robust multiple of now. deliver streak to the XXXX

our XX% rates, the businesses growth while other revenue in our from from of Specifically, XXXX. majority of revenue came still our come

the growth X non-rates over our over In businesses. past XX% revenue of from came years, fact,

Over per XX% revenues of growth since period, the attributable International grown our average XX% year our revenue same on business. to was have international XXXX.

continues Our is to scale. international Pacific suite by but European business Asia anchored product our our business,

markets equities, volumes year-over-year. than money business APAC credit, and rates, more spans Our doubled and

XX% diversity business. came strong We products across were revenues on generating XXXX, XX% active APAC client that up a from with APAC the active products year-over-year. have seen our over to product global across of in Over users revenues variable our product our growth APAC the growing testament APAC in product platform XXXX

products. driving the presence non-APAC As region, APAC we engagement across scale across this strong APAC also is client our

U.S. example, European we in client and growth strong meaningful being the offering. Japan U.S. of scaling credit. XXXX progress XXth and APAC our and we anniversary across have made our For active markets, government European saw in marks swaps, bonds,

than an time same swap while Our Japanese have an of greater that average frame. increased XX% at bond average XXXX, at government XX% volumes yen grown have volumes over of over X-year since our

first our a the across been as being prioritized in believe year-over-year. Throughout emerging market, larger continue we success. the adjusted broadly, we to markets ahead, Looking Pacific expand have requires component fourth and more as million expanded quarter we constant at few client innovation bear investments which XXXX. will our of product investments we In critical become region. Relentless over shape margins history, to to $XXX Asia our of network years, of consistently. Starting XX% revenue technology the story growth has years drove and, our have our have next markets, EBITDA of XX% future Treasuries those last the Slide share market Record to XX% help over on U.S. X. fruit, And growth invested electronic with average of growing since an investment. X

share be continues important and an institutional our quarter above market electronic indicators Our third treasury business institutional U.S. by XX% record saw remain competitor, U.S. the record our trades quarterly of with leading institutional gained average share daily XX% achieved main We of revenues in theme consecutive strong. over versus business and Treasuries AiEX over to XX%. increasing Automation the year-over-year.

second continued key equities, we best rXfin. quarter a to continues U.S. by enhancing wholesale This produced focus deliver prioritize protocol, area contribution in holistic record we ETF Wholesale achieved our business, Turning sessions record remain on providers was liquidity history. our to of Treasury fourth activity, onboarding and liquidity pools strategy. Within growing streaming from more quarter our revenue we as business as our led and various our our adoption our of revenues.

equity our franchise derivative continue equity Our ETF brand record bear flagship our with fruit, to efforts year-over-year. beyond revenues to increasing XX% expand

well remains by business. resonate. secular clients, we client continue our story, continue positioned the the equities Looking to integrating long-term ahead, and in make not solutions ETF inroads on believe pipeline fixed to new to are We the just as but our benefits income strong we across capitalize growth electronic of

X% revenue Turning Revenue was credit. to year-over-year driven Slide XX% respectively. by look growth X growth strong at and and a credit, U.S. another closer for European quarter for across

derivatives. Automation quarterly electronic U.S. global We over with and also achieved credit IG credit share across We continued across market our strong electronic to the fully growth achieved highest trades average highest XX% second market yield. fully U.S. daily share high double-digit AiEX across revenue quarterly year-over-year. grow increasing

as X,XXX-client and liquidity We the threshold premium also client the quarter crossed gravitate our clients in deepening count pool towards experience. fourth

institutional business to Our our set as scale protocols. clients of diverse adopt continues

year-over-year, RFQ IG institutional both daily and across volume over growth strong Our double-digit XX% with high-yield. average grew

revenues both over trading. Retail high portfolio and fourth as of over across touched trading XX% IG portfolio volumes RFQ of XX% year-over-year a rose to daily Moreover, new high-yield. muni average percentage growth of over fourth Our loss a another down outsized the XX% AllTrade tax selling the year-over-year. solid credit quarter volume but solid a in quarter IG quarter due with volume, were produced across trades up over billion with produced revenues XX%, XXXX. primarily in in quarter $XXX

year-on-year. Specifically, number team The our all-to-all the offering and our be In the rose number fourth of digits focused to quarter, platform. AllTrade the XX% inquiry average our for responders all-to-all year-on-year. continues year-over-year, over grew low over network average daily on the on out grew single XX% broadening dealer increasing of responses and volume RFQ

we more of redefining portfolio our grew with was protocols. algorithmic XX% and year-over-year. It capabilities. sessions, volume with from of growth further daily incorporate of have diverse than our Stepping RFQ, growth our and over all-weather out and have set share. to trading XX% tripled IG respectively. focus offering average a coming rolled our XXXX, Finally, share trading portfolio share XX% a enhanced than our grown enhanced fully year our and double, sessions RFQ analytics, Edge, we on and by ETF our more was innovation Since driven back, electronic high-yield XX% IG We by

respectively. XX% growth with of was and by the RFQ, sessions, share On high-yield being front, our XX% and driven driven PT by XX%

opportunity U.S. key the focus believe our remains for asset a clients. like for We way long a class. credit area, runway with ahead, ample this client are alongside we Looking have channels we across our positioned and growth innovate to we

upgrades interface new client our analytics trading through trading penetrate are life enhanced experience. to further user focused to and leading offering, improved block an cycle, We workflows, further on the PT tools

on focused We also remain at very away high-yield. chipping

high-yield solutions differentiated both next pure average the very fourth near the in of to network. We're and Our plans the integration, remain focused phase on over in deliver expanding rate our Aladdin our teams efficiency. deliverables new real formulating a quarter, with are we workflow X record goal end of on liquidity and client response a XXXX hit

our credit, focused U.S. we are Beyond on expansion EM efforts.

quarters, live build global looking suite. trading our Arabian regulatory network, our go and the with to working for approvals leveraging Saudi in coming Indian product Strategically, expand expect are local We to our we're solution we through our robust and offering. offering a

a increasing volumes, fee new which rate. share, client-related the of macro XX% weighted average in Moving grew market duration. to Global record Core XX. in, which environment, shift XX.X% carries drop in set better client basis market to trading, decreased XXX to swap towards points compression European significant swaps risk primarily by strong combination Overall engagement produced the share stable excludes response global a fourth year-over-year. lower quarter, due significantly trading, to and Slide mix All record compression in a risk over revenue a year-over-year. revenues, swaps driven by

across During also swap global we growth. share year-over-year. increases the our market G-XX sterling swaps We and share in we fourth over second revenues and Kong record basis achieved highest revenue exemplified APAC institutional Hong quarter in the our franc, dollar, EM-denominated swaps with XXXX dollar share swaps. revenues XXX across history second points saw achieved currencies Swiss each of of XX and highest currencies, quarterly The biggest quarter, our European dollar the Taiwan record gaining share Across EM across the and across and across and our market swaps. diversity

XX% Beyond points of in opportunity market us. XX% gains basis remain our share least yet this, XXXX, at the XXX market many ahead saw of highlighting over share, below currencies of

protocol. swaps emerging RFM and we Finally, our rapidly make to market growing continue across progress

fourth Our the there to low EM year-over-year, grow, swaps of levels is over given electronification. believe and revenue significant quarter still room rose XX% we

RFM up. picking with protocol daily over Our year-over-year, rise saw volume XXX% adoption average

believe growth long-term macro global we backdrop the to in meaningful. be revenue potential the continues ahead, swaps flux, Looking is and

does we could build can potential our but clients, it significant. upside when adoption for be happen, solutions the As time, take

XXXX. we For of Adoption swaps our inflation rolled out slow out the electronic gate. in offering example, was

XXXX, industry XX%. is volume swaps inflation since However, up

Our frame. that risk-related are up over time volumes swaps same nearly inflation XXX%

to We providing of solutions for market. swaps are looking more the forward more parts

while about grow. with remains the detail. our global markets that, in Sara me we swaps a And markets do XX% turn fixed to believe digitize market more income manual to we broader to swaps there help workflows and lot let clients' still it discuss our can over With the electronified, overall financials

Sara Furber

Thanks, good Billy, morning. and

provides go Slide otherwise performance. I the be all unless our XX numbers, earnings of the comparisons summary prior period, As will through noted. quarterly year a to

XX% denominated a earlier, reported recapped revenues of up XX.X% of XX% record this in on basis. we approximately revenues We fourth on XX.X% were recall dollars, Billy saw is derived of predominantly that million in than and base revenue approximately As our currency constant from year-over-year $XXX international quarter, and euros. currencies that our basis clients, quarter a other

Total our a the government subscription by U.S. schedule revenues basis. total fixed of X variable by driven of asset revenues addition dealers driven fixed the revenues XX%. to were by was growth reported our to revenues on classes growth trading was other fixed basis platforms. fees revenue revenue increased year. And XX%. fixed XX.X% Our bond a mortgage a major Credit more constant primarily up of a XX% up related and and movement currency and by this on trading dealers plan the to more fixed and dealer increases to and movement our by by a were primarily XX.X% increased to Rates

basis when EBITDA adjusted XX year basis periodic on of a enhancements fluctuates margins. to As Full reminder, XXXX points line tied a performed increased to this XX.X% our technology our compared it clients. by retail XXXX reflects for reported year margin revenues as full

fees million Slide quarter. a the Moving of on XX key and the trends per to on for highlight

You XX our can detail presentation fee earnings see for the Slide additional million of this regarding quarter. performance per

For across government U.S. cash primarily bonds. fees were due X%, down average million rate per to fee per lower million products,

long-tenor XX%, in decline were million a swaps, primarily to For compression greater risk-taking activity due fees per and up average volumes.

fee fees per fixed. credit, cash from munis in and average change to For mix plans a away due dealer decreased million a to variable from XX% shift

increased variable us inclusion ICD. Slide the finally, a of allows high our For a X% XX fees of scalability details expense ETFs, At base grow due million. average adjusted growth equities, for to EU and per cash shift with a fees million margins. level, higher per money expenses. carry million increased XX% towards fee the continue per nature to average markets, to our due to invest And relatively and which mix

fourth constant maintained a and a quarter here. XX% for consistent on currency philosophy expenses the basis. have reported both We increased Adjusted basis

consulting cash invest strong Over development. compensation related with grew flow investments On 'XX. Slide the majority equivalents, in we the marketing, policy, Given in ended movements months. Adjusted a performance-related XX the to for vast relationship to a pickup assets, million quarter environment increase administrative cash quarter travel we in from in details well components. in FX or and growth, discretionary continued costs position fourth $X.X billion during technology communication capital incremental our a strategy variable came the which compensation and loss $XXX,XXX XX% management digital of million of the that the entertainment long-term for was of grew costs approximately quarter previously approximately as increase data 'XX and as tech the trailing to due a marketing, and fourth increased fees mainly quarter, gain client return consultants as and guidance. we in our $XXX and addition capital offset to versus the XX%, communicated ICD. Technology $X.X due Adjusted fourth position in due investments by to increased strong our primarily in operations resulted Adjusted costs our in cash XX% fourth general and and infrastructure. favorable free an in build scalability. of XX XX%, and professional and and onshore XX% cash reached augment

earnings, net interest $XX.X decreased cash on Our With the Class Class $XXX B recent with per lower a up quarterly this year-over-year. ICD million quarter's $X.XX of and declared as to we hand. income funded of balances cash shares, acquisition dividend of XX% our due A million Board

for Turning our to XXXX. guidance

expenses $XXX The year-over-year. to represent billion. range are of will the XXXX to million to in approximate would expecting continue and from this XX% midpoint in range increase an We adjusted invest business $X.XX

of midpoint to focus we the with in increase would relatively expansion continue the higher range, impact compared of muted expansion this line incremental and XX% either average We range as margin this approximately expect operating year-over-year, to margin of XXXX with an for represent EBITDA since the be although future. XXXX. adjusted the at are expansion and end growth drive to our expense believe balancing Excluding investing we margins can margin acquisitions, we overall on more

and in growth. long credit, continue invest focus with rates, for emerging we as to key a Specifically, runway areas markets, ICD

build in to also us platform. We leading that and allows our continue invest technology to sustain

these time technology to price we innovation continue of our and will drive investments Some but to scale pipeline. growth, revenue take

technology to growth and platform We of expect to expenses initiatives. XXXX and grow quarter our quarterly levels, the run communication product from 'XX new of continue support we and infrastructure rate the fourth to strategy invest in our and data

annual T&E. due in cyclicality quarters second expect expenses levels G&A to We normal the higher with the fourth in digits to grow mid-single and in seasonally

to rate consultants. be to our we run quarter fee quarterly technology the levels 'XX professional augment XXXX at as with expenses continue expect effort We fourth

approximately We headquarters and due overall occupancy expect annual geographic XX% our York to year-over-year, expenses expansion New the to of move our primarily new City increase footprint. to

the expenses XX% first and million year-over-year occupancy second half expenses to approximately rent-related to $X.X expect duplicate We in expenses. which year-over-year, XXXX half includes XX% of rise XXXX rise approximately

tax rate forecasting ranges For year. assumed our to for non-GAAP from XX.X% the purposes, XX.X%

City D&A, which increase, building a is increase to with the and driven CapEx We due initiatives, Refinitiv CapEx million approximately out growth expected $XX between $XXX XXXX. in will expect roughly approximately out will our New XX% related the primarily $XXX to growth to The CapEx. adjust on and development to implies We that XX% our million. office million of XX% range associated be and capitalized our and ICD year-over-year to midpoint software and be we maintenance accounting, development acquisition. Acquisition York guidance by pushdown and new estimate transaction-related support be spent software

the to million LSEG in we the to 'XX. be XXXX million, to expect the in data $XX continue with of quarter revenue approximately master under expect $XX Of first million. we agreement Lastly, $XX generated generate revenues

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

William Hult

Thanks, Sara.

XXth fixed are my Ahead technology our believe clients third market I have not of and the CEO, at clients? on helps of about changed, grow been as the we income The more for provide of rates. as opportunities a to company ethos the company ecosystem to one never ecosystem. and Tradeweb our leading overall to offering were had outside what ourselves, the the known year to the that we financial can IPO, we differentiated that rates embark improves I of bring We do ambitions year companies our has my to ahead excited that known leading of we ask As as us. a solutions across innovative now constantly

am time upon continue build footprint. electronification but reported ahead, of I year-on-year. to time income XX% January note, Looking be it's that strong risk an revenue intermediation to better excited ecosystem. morning, to shape the translated into to which growing of a volumes January class On in even It's leading a our business, multi-asset in this good the growth fixed we

related to growth payment Excluding revenue the the $X XX% that data LSEG have would market we million recognized contractual January, been in agreement year-over-year.

of I our including ongoing inorganic market current to and opportunities to our the both previously would in to Before global will markets. Troy to company's responsibility next and continue the maximize be X They client of channels. Bruni, Tradeweb, our products, pursuing geographies, growth member look I of strategy, across Board. our to conclude, I execution Troy, upon global a Dixon co-heads legs for growth. build together overseeing was work the with Enrico conjunction who potential like organic Tradeweb welcome to of will forward share and

it questions. to With like revenues thank quarterly contributed to colleagues quarter, business volumes annual in I my their I and record to to for my the efforts our conclude Tradeweb. will that by that, Ashley your remarks and clients for back at I for the want and thanking Finally, would and partnership turn their

Ashley Serrao

can [Operator take Eastern will you our XX:XX Instructions] now Billy. at Thanks, Time. end a.m. first question. Q&A Operator,

Operator

And our of come Instructions] first Chris [Operator of line will Citi. question from the Allen

Christopher Allen

to the right about you in interest Want talk flux noted, Billy, is rate swaps. now. backdrop as macro

something trading, conducive flesh percentage of less as in risk-based more trading. Then on else? a out that compression current a frame clients or risk-on environment the is you opportunities maybe by trading function that's activity. compression So could activity, or out Is moderated of

William Hult

just another Chris, Thank New many possible. Happy It's Year. to through obviously, going like Year, that. rates voice. about we're the a like good appreciate to feature I when of a your step a if quick a to try hear like I say good of little you. volatility market. get bit question. know know late it Good It's to think Chris. When as a context kind we around call at on you but kind bit of cadence Happy question, double I of back there's bit kind New your so And little XX:XX. today guys I questions, of, little have theme, a like in little And of

a sort Japanese the more of collapse way businesses of CEO, this last it early SVB about of since Ukraine even of August Russian bit in a our Chris, volatility was 'XX, the then have 'XX, of amplifications impacted into the events think year. little second. about sort which became like massive but and Just stock for rates, route credit event that invasion a in major I think of the in

are of of these exposure. And brand moments that's firms destination sort ultimately business. And the where about this biggest that sort are we I biggest feel us have perspective, almost choice, kind leading in the from marketplace and these trusted the of stressful talk the we moments of that some that so global a rationalize. credibility. market in reshuffling almost ways can to become of comfortable from moments Prices are And headline, building challenging that the of unexpected a our of in sort platform participants perspective, like buy-side for our And swaps, these become almost my for and, are test as ways, moving around when that clients, blocks part our ecosystem. in the

the as all world. of have market sort it in ability real the a you electronification protocols orientation capture that when share grow environment, and that grail to kind micro-trading know, And of, so you is through like different you risk of transfer, holy enter now that's into which

as I trading. Chris, data this the is, for like XX% think increase up almost conducive us I by, our risk-on January users active think, swap year-over-year, we tells was year-over-year. it's think, very of we January, saw quarter XX% revenue that XX% what total in up environment Fourth so And year-on-year.

I ball. trade the bullish we are, I given and sure, be but But one fact on a company, say in of there don't debate inflation so no about war rising concerns, have is crystal for this we the I than plenty are headline the know And forwards, that of market. risks, you ball, solutions has the better geopolitical know the laser-focused kind that market, clients. uncertainty, crystal sort time, all a building do. I this to out market is for the on going our as of

communication in mentioned, go you partnership. hand-in-hand as type takes we innovations believe we our that adoption but down this path sort with that time, rate script, success and of so of part clients, buy-side in with have And higher our a and sell-side we I because highlighted the of

of we the looking clients. for where going the swaps long to very see can, and runway perspective, the market innovate after center, remain front And of continue and parts ahead, forward. more we in so optimistic market from areas about onboard a I And business the growth my go and

business I think time a that to today. in great it's be

well trading tactics was had that out you think for has tactic the As technique get know around we've very risk I transfer. well, us. the worked that And compression to technique into and very and

And performance very role that. really question, leadership the play much thanks the feel in about business that we we and of Chris. swaps good for our So your

Operator

question coming the next will of Benjamin Barclays. Budish our from And line be of

Benjamin Budish

a this a technology, come in what talk could digital prepared may what announcements of with from all How assets the partnering, think, broader Billy, remarks, I talked that if Tradeweb thinking spin lot technology you assets Sachs' the you're you of doing you There's coming kind talk above digital sort business? years? are Or couple of see about from about Can and out of Goldman over blocking Tradeweb you you them. I are was your you many here? been the platform. and into fitting innovation. wondering what from doing crypto, any next do of about

William Hult

you announcements I approach I we've about Yes, this very us you you're that well, creating think adding talked say value. quite the right space good and center front question. our about about headlines, bluntly know when And right? made. and is not sort of in would It's

lot, and are. using this so know, company our clients' since bones which as of ethos across about trade the of the who X of been DNA workflows as shop this And we've technology kind I've is, the cycle. remove you is day we to friction talked in a this classes. That's life our about across one-stop in sort That's created asset

so are because space we in we're know. the as company very kind of And you focused ambitious an

foot we be front around so And change. want always to

watched will it CNBC. Larry is and wasn't at Davos sort transformative And so I ruled -- lately, on how of and we've some which Ben, saw about be. tokenization of treasuries, assets, the I that fixed of the things kind that seen but concept the Fink equities, of I'll of you, talking highlight for income, I democratizing

that of think aware sort all then of chain with how money are thing important market this and terms Securitize. And on yielding defending obviously, that's and important think that's and think they kind think I just be I sitting fund another that I something that with instruments month, space partnered coming the with in complement strong acquisition movements mention well Apollo. announced hearing Hashnote We we've we the important that's of they are we of lifting are via where think and obviously, their And securitized. concept announced their they to an is, we're diversified of. Obviously, from credit to would Circle been very I stablecoins.

question, at on of kind lot we essentially So areas. back, strategy, very a of happening. From kind it's of focused step One digital perspective, in people X assets and have data. company, our the very strong trusted very as smart, your we is to kind our shareable laser focused

and these The faster think parties, data. And by a for world are second, and asset utilizing among as of kind important those of company. life can cycle smart because I would describe of transfers automate smart we and big we and to very you, and enabling operations like contracts, as multiple ecosystem of events, contracts kind as see our us synchronized the then are tokenization areas focus sort we about things X lower-cost

been 'XX, we've A investment May year. very I space. the we last in Securitize. partnerships so important and over In of they're strategic busy. of them. We And very made with smart our first lot the players think mentioned

for July, know followed We in Alphaledger. know firm and and with is being, I past then a is up Wilson bit agreement and And that. commercial to is And with giggle. partnering a Don a of idea. of a you that Network He's historically little this We we Canton investing a think money. say good think the this kind also July, we we've joined DRW Obviously, with a with while. I'll him Canton smart Network, important. the been that close

space, about to So kind this is think quite what our continuing of us in best our good which comfortable and very innovate, would question, something markets. and you. And we we're this you do kind doing front-footed the to next excited in expect the about in open, evolution being is partners and keeping space. invest to of this well affect space and this in I thank how feel positioned are in very they that A we options

Operator

from And coming our Alexander Sachs. Goldman of next question be will Blostein

Alexander Blostein

Sara, was to a A hear somebody phone whether just minute. up little broke of for the guys, bit. question or it kind name for I the a my Sorry, else's. guidance couldn't turning

the year. leverage. comment being, you at in bit little encouraging just year. uncertainty of a still pace you your given what Can there's last delivering about coming of saw expense environment, clearly some the guess, operating a a revenue guys to around growth that you around I strong lower than there put pivot kind So off last you really base, talk positive ability

are things operating pace could those you deliver how would -- revenue if you still work So at that a slower X to this of the kind below leverage? how guide of Or be would growth, positive together?

Sara Furber

the in talk question. and have operating that. environment. revenue Happy perspective, Alex, our it's let navigate great even a leverage within operating significant we leverage weaker about to will business, From that

this of generally revenue XX% which variable before. different a built-in flexibility expense environments. of about talked So I I've is our or think discretionary, in lot provides base

approach that but our environment and about those. of making in costs variable, things, based the by fees on pretty to costs environment. on things and calibrate been based on like market the of are obviously of we have a in T&E has the manage we where the that that continuously us, are we what lot to strategic and manage think a cycle. like by things discretionary, number we're volume-driven important marketing, So the invest like also the flexibility compensation, hiring pace front in, want we performance-linked And up commissions, We talking dynamically, going how sure we I'm scale Overall, consistent. down of revenue exchange that opportunities things including those through are

our -- digits, the revenue think to to margin last question look you the mid-single able equally if spend managed and I in had I environment don't not really XXXX pudding. in of of saw that but balance top you take further top back improvement. and momentum of would was important, environment. you was maintain at advantage year, to than your look exactly half grow see to delivering environment. a us accelerate and Revenue still line say the going kind margins Maybe to weaker and have XX%, to line first We we proof the

be I deliver that Thanks think to to the nimble. ability I invest of And we've a the long the environment. willingness a flexibility both ultimately, think and to regardless we question. good and track operating the gives our So also of leverage term for sense have you record for shown but

Operator

the And of from Jefferies. Dan coming of Fannon next line be will our question

Daniel Fannon

versus all you some at are at you've a hoping trends the the been regulation potentially And years? more banks. that taking level, going high have you of keep in be of see that couple prevalent using more just a if that was you to have on so looser trends talk more about strong, in-house sheet potentially could kind or banks of do little got electronification think been risk, balance bit so last Billy, or about the coming from as changing

William Hult

quickly march that's and goes onward swings. of brain of the think framed. not like certain been headline, swings kind of particularly my of our I say X from Good a feel interesting. pendulum quick that back kind electronification of of question, where and like We swing question. is perspective would in regulation pendulum Dan, the I is forth. quick as how amazing way. And about kind sort pendulum has pretty are think your of It It kind you? Yes. kind around how ways can sort is does of how a

pandemic, the the define private this If like are lot their almost most of intermediary see we like and down good private the concept really in intermediation, back, good want our that this for like clients. And it sector almost And a the our perspective, sector trusted intermediation is banks for like market electronic we say to like ourselves, think is in the like about between business. you business revenues rise being since as we think quite normal. very, become from very new important We it, banks, their business this thriving I us. it's

as bit also of platform the us in the risk So trading good sophisticated kind recycling consistent warehousing in our presence flow little their with is way, then almost for and institutional then invested your perspective, side. But mirrored operations warehousing and important while clients, in most that to both business. the efficiently from having providing, wholesale that banks leading for liquidity a our right point,

of good in. in electronification kind I all, healthy going like towards the is a that So not consequence strong the all live and breathe feeling the of and and vibrant before, really this as it's to question slow move banks businesses we be at a that anticipating at said

of around wind stakes quite outcome switches thanks to and interesting. the are regulation table question. we And strong the But efficiency banks think us. happening stay. good that topics from quite both And think being good of for are just a Interesting being that around we up the I kind that the like up benefit here efficient, winds question. and for your

Operator

will coming of Siegenthaler be question next our of line of from the Bank Craig And America.

Craig Siegenthaler

a little name think here. went but I like bit I'm Alex's my out

So streaming trading is volumes our Treasuries. session on U.S. in question and

out data are of just the over industry you in quarters. trading some there kind usage protocol adoption of pointing terms treasuries? an last session towards rates What seeing that's accelerating of in there's in streaming So few

William Hult

good kind a way, and Yes, too. a that It's like micro dynamic. question. almost it's a It's we shift interesting see that's of really like sort happening of structure it

about that professional of market away CLOB I sort DXD that think traditional, as of where casting, marketplace, of central taking protocol marketplace a sort wholesale think all sort we we share central to that out of being are kind there of happening what from across of protocols market. of kind that kind DXD of that first almost kind is understood shift of as kind

Our the due that instinct CLOB is away the volatility lower seen in we've move of that environment part obviously, from is rates. really to, like

streaming is volatility outperform business instinct environment. business in lower a tends Our the the session to and

and straightforward, Treasury the always And to so strategy way, U.S. basic in marketplace. how our product integrated a suite pretty can better product across be positioned deliver we which is very entire is like an

competitive protocol around shift think and driver And that CLOB important sweep and to our do a approach But so in absolutely, CLOB, offering rXfin. there's from I perspective, with And a that it's we've world. of comprehensive streams, been be our been usage. change

describe average in when year-over-year. best continues of streaming driver kind to our so almost bit XX%. rXfin sort business the very related a something U.S. client spreading important over us. say think, and the from important high perspective way to sessions facilitates us as sensor actually cash continued sort We like So business around that That's a daily it, trades. little for is very to that, up that the rXfin, I I of was of XXXX, and XX% that's features ownership. think algorithmic-based a the -- And sophisticated up us percentage That's grow usage volume and most be technology. aggregation for wholesale wholesale a was of for

about think basis XXXX. higher I XX it's in points than

push market kind this So are micro shifts set we with that that shifts about guys well and good comprehensive described it. think that, Sara, as where an and important leaders in Craig, the much complement very the in of you of share new important feels away. the a CLOB occurring, combination team know, and well, in table up we emerging it's Troy very environment we in because are for asking that's We and still business gaining And we're those that's where We hired at share is that very you the going. don't great us an like market increased because in around terms occurring Dixon, to on I CLOB. feel gains that to that stakes protocol. The think think the we've me question, going continue offering. as been thanks CLOB of know And for those treasury we market we're The myself protocols. focused

Operator

next question coming UBS. Alex from Kramm of will be And the the line of

Alex Kramm

priorities credit, your And there. Billy, again, focus the just walked in investment I'm was earlier wondering how prepared one. through increasing you're when remarks, number much the you

that disruptive. dial XXXX competitiveness be to you're going into think all up think some people more I the with that have, really the tailwinds you and

credit price be you market become? to that this focused to particular, well? gaining? to if factor How And continue price, right. much a then, have And of just wondering of going So ask will is more even I that, how are do would can in much a as how what on course, much share

William Hult

to like I like that mistake talked on credit space. no in one kind a you good well, along ourselves like huge focus it's very But a marketplace rate Yes. of we're this basic continue of right that differentiate we things market period. that to the couple us the now, company's opportunity see competition mean, the the extreme I that will and about company started And for focus, know it's the on couple the the It's with question. as as wanted the innovate a to space. of mentioned we I themes. and And that concept because the initiatives of working laser up and around in in a premise

good feeling that continue So we about trading, set trading. the we and portfolio up. to have going we're board position really sure the making across maintain leadership in that good we how feel around invest We're portfolio to

we theme heard of ability towards. Price up clients. responders inventory And a of that share. say of we about kind of sort question the something in we're dealer is our the that that. and getting horse kind down think we into bank's think first electronic the to We that that's a concept biggest positioned bit efficient don't was deliver getting base We that price about for the and We access to feel provide communicated are kind lead step. value little and the and partnership go invested concept opportunity And client And our are a bringing foremost. important that fashion. in just not I like going don't the innovation, client pick timely to top -- wants of about of terms getting That's path about differentiate access adjustments to of little from you've base into investment not have into. really Aladdin like ourselves like and wallet It's right clients lot we regulation. list into the and me the there. a big invested of the an the it. way to of bank/dealer in and a feel XXX% very But most and all-to-all question getting asked bit to are right a our network. I've because more a good that and for perspective, more is and with thanks those the talked that talked at I we the more it I've in asking of

Operator

will be question Patrick Piper the of line Sandler. Moley And next from our of coming

Patrick Moley

X been months closed about you So the acquisition. ICD since it's now

milestones hoping you've on should just was the capabilities that of state a success be to your we union So any their the in of and for that cross-selling integration has give on how maybe you lookout seen gone, network, the maybe XXXX? just could any client in kind Billy, I

William Hult

Really hand you. good Sara, let me question, to that Patrick.

You've been front and center on this.

Sara Furber

I progress on been pleased a team quite we've thanks. Sure, with the Look, as ICD. think really

see which on at really XX%, business the and revenue, the growth, expect out retention, gate. the all foremost, looking about are that balance First of core Whether continues we're core client at XX%, metrics at perform that. is plan, we're and growth, to quite we excited growth to client

we think our The independently. platform the on from tech ahead, milestones, core going it's think that as platform, a perspective, the about run classic tech ICD integration. not largely from will I operates

investing about about so particularly less we've referencing treasurers, around corporate those and for ICD's And around building, really of liquidity that treasurers it's a I opportunities about and revenue milestones types talked that the solution needs. you're say, long-term comprehensive would

more leveraging And so their expanding with and from which perspective there. when of is zone a One we think Internationally, and sales with we've and reach things. footprint Asia X client our meetings financial prospects. internationally engaging perspective time table, the client efficiently and momentum to it's leveraged we're our especially regulatory ICD about doing by force particular, the and in buckets, begun to institutions, something and already relationships, allow really those a we infrastructure, our different kind bring joint operate is sales seeing to force, in from

to bit takes sprint, in ability This a would drive of onto I this And a platform. in think say will really ICD's but the their the good obviously also other longer. has particular, so product And I part side our around progress products of materialize offering, is of early made by expanding days. bringing engagement. bit the which good that coin, is our That core a we're little a isn't seeing business marathon, XXXX.

have expecting year this ICD's by to sort the platform. on we're middle Treasuries of start be available those U.S. with of and year So the

all that's there, platform asking the client done clients, to there. good see we've think formal of surveys. and we in for base has And our we engagement a have once expect think XX% with leading been I treasuries. we obviously, of reception

really to we're and And as more the thoughtful do up on the set particularly momentum. So good want we're quite think term. continue the would look goes I we as and engagement, in corporate report clients as we think this seeing we're on we're base, focused that on. I with continue I to focused But obviously, strong long a extremely up good and just we'll again, ICD, those cash, they're of a level, levels macro way, we're year set seeing think while on But other profitable. we're is on client to forward expecting thing more we're that their well.

direction ICD. So pointing a as things all it relates in to positive

Operator

William And question from will be Schmitt the next coming the Jeff of Blair. line of

Jeffrey Schmitt

Schmitt Jeff here.

market automated such much in trades. So strong to treasury institutional continue that treasuries, or strong your And you today? in adoption? your client the of What's in how automated is protocol with that's automated growth see mix driving channel for changed

William Hult

Jeff, question. Good it's Billy.

I and things we've And a say a very bunch that we've of would of gotten right. things right, I -- gotten so I but think bunch everything right, humbly, done think not

more the keyboard. space, our I header, of right, would -- that first was of good it approached it's space think type or of evolution sort This we've with the kind phone a liquidity. the they've to is finding really too, mouse, the the of like right probably this phone one and to clients, how they've this kind the I next best, little and more done the functionality evolution a the the say things to job gotten to mouse, XX:XX like first as of right joke kind go and gotten as guys sophisticated of we've of of of in keyboard algorithms way algorithmic well. It's most you terms make your AiEX the the double sort I'll a

Bloomberg. that like so I liquidity the approach it's I competing sophisticated with board and from day amount client liquidity across X attract search resonates kind X looked essentially do the then marketplace? you this we've for do been of to find do with so I think differentiator in How the the many of on rate our for of sort There's at continue perspective. vibrations liquidity liquidity generally And where in layer in so of I think think and as the do lead trend good marketplace How a as now, footprint from more it's the way act there way. And protocol us space with is how is concept of providers? find ways less? much important. the in resonating and sort a least to because and leaving I of I my particularly that kind

I think it's sticky.

smaller, risk digestible trades the then there's concept large we've something sort trades, of in and dark so into And in those to down like about intuitive concept very that. seamless a execution breaking the of obviously well way, trades continuing this more finding of invest pandemic, of as way. buy-side the days X through And gotten technology all I those the just think now of is

your I from question. franchise perspective side space. terms for enormous done favors the our sort like some the go. we've of the And to to rate desktop And it's it in I client trend, in space But of where so some rate behavior thing took on in done right around that our really and process probably see understand, And of going a was think, a very thought willingness of think, think terms that Jeff, to we best has thanks much, differentiator. the getting

Operator

coming the the Voigt question And KBW. will next Kyle from line of be of

Kyle Voigt

large-scale appetite there or look on you more both So for we rXfin also XXXX. table? could your if should still is frame completing What I after whether add? XXXX, in bolt-on capabilities whether in the curious additional M&A check M&A And in and on would just to way is any ICD deals type expect to

William Hult

heard focus asked way the has very in about of that I question Yes, you've talked kind about operate. And we the kind specifically credit, focus. question. good earlier us I the and company and was of like understand

focus I organic start have would business And we and would is by my confidence in growth I there. that strong. start the company's and the extremely so is on saying focus around extremely those strong the business the

do Second feel would have worked I the very Sara say I this. thing on and I about good is concept, and closely

with and CEO. You of X said it, of of in X X sort ICD. -- rXfin years 'XX me tenure deals deals the in as Kind

integrate, and important know it's we deals, how the how assess to we do to we how think know show to know to that value. marketplace I

look through have algorithm? concepts. When And is pretty there for Is a basic. culture we think a it's like that out hugely I if those like, it's this, technology? happening going technology. is there get acquire? And through us, we -- say to then a to think as with network there culture, network through Is important we we we're it so an there assets in we it there not important piece is like that about incredible of that acquisition? we an lens, that's at something those of those there, something better lot it. a this But us criteria, I that out are love? basically for network and is us, excitement things And Is company to then a that was we're business, 'XX, through there X technologists. and if And we around add network it can a we a feel have the feel like up technology

a Sara, So been gotten important largely I do pretty And able that. been organic company part I very you for us something has more a deals. And It to a thing think as opportunity. you here doing to well gives that big business our be of you've through it's gives think credibility.

Sara Furber

-- provided totally acquisitions is of these No, what upon our I fit strategic think that strong. I you've I types we ambition for mean, said, building think just the

an being also financially. focus extreme ambition have we bolt-on just have that on You limited acquisitions, to disciplined, particularly isn't but

we at talked and we've acquisitions what we're really financial the strategy, metrics the important. And So that framework we're around particularly the expansion, doing. but networks culture, client amplify us, to the financially, that think about matters are looking

profitability. helping to earnings accretive or accelerate our So within growth couple a we're either and years of

to I we how want be an it. we great are the and ambitious look So disciplined to to Billy company, said very important question, we're things topic. that credibility about think that is build combination at going then do A well but we

Operator

Morgan from Stanley. question next And coming the will line Cyprys Michael be of our of

Michael Cyprys

steps business initiatives part about contributing products for going time? be what you're be about of you this over meaningful? thinking Tradeweb. talk story think part there markets. could to larger most of and some talked you How just to about Billy, countries the sort And you you accelerate of emerging the the growth do see That's a of growth? Can taking

William Hult

absolutely. Good question. Yes,

and on what the we're strength, we obviously, we been tenants out we our rates EM space. believers for kind beginning, as the really that's that big at the credit, the EM like that's building think start of good well where around some competition So world. with we've we with pretty world, start in start we are thought EM about swap, from of see sort as presence focused appetite been with in so the want But the EM saw there, in in I done of the an same to U.S.

overall So offering and multi-product business way, of across period. as a markets I see kind our credit, an rates say in emerging would we

I -- it's $XX And those so at run rating bit annually. are little XX% our emerging business markets think is revenues a million And over now up year-over-year. about

EM, electronifying in plus, more that in world both I the ability world progress the the potential but possibility lot rates of swap close we've and 'XX. of about made in terms efficiency, and that a currency it that kind hard call good innovation that credit. That deliver local to to seeing growth feeling specifically like XX% of provided EM obviously revenue think, like there So speaking, total in sort we of

we that as room of see of confidence well right kind that for and think we billion. on go the addressable wallet plenty revenue kind of EM overall When $X over opportunity, So of we're us the about sort total to there track.

are kind for numbers of those there. so us And big headline

thank word focus, the a company, there. already question, continued we EM use interest a swap of focused progress big opportunity. made swap from good Big it Maybe can We it rest of for into I XX% rate it of and as and asking kind rate business. on. of something think kind as and I the a cash, side then bond that like from very comes are EM XX% the of of and it. push it's It's of company, we've the on the credit, you for is a a world. But again, come around that China kind feel lot us EM side

Operator

on over the call like would call ahead. to to the and Hult remarks. We've closing over run now turn for Billy go Please

William Hult

questions. Great you us Thank joining much all very morning. this Sure. for

the questions, day. second team, if Samir. feature of feel the Thank As you free please our Have have follow-up always, Enjoy great great any to to reach you. a Ashley, out movie.

Operator

joining Thank conference you today's for call.

You may all disconnect.

Tradeweb Markets (TW) 6 Feb 252024 Q4 Earnings call transcript