Tradeweb Markets Stock

Good morning, and welcome to Tradeweb's Second Quarter 2026 Earnings Conference Call. As a reminder, today's call is being recorded and will be available for playback. To begin, I'll turn the call over to Head of Treasury, FP&A and Investor Relations, Ashley Serrao. Please go ahead.

Thank you, and good morning. Joining me today for the call are our CEO, Billy Hult, who will review our business results and key growth initiatives; and our CFO, Sara Furber, who will review our financial results. We intend to use the website as a means of disclosing material nonpublic information and complying with our disclosure obligations under Regulation FD.

I'd like to remind you that certain statements in this presentation and during the Q&A may relate to future events and expectations and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements related to, among other things, our guidance are forward-looking statements. Actual results may differ materially from these forward-looking statements.

Information concerning factors that could cause actual results to differ from forward-looking statements is contained in our earnings release, earnings presentation and periodic reports filed with the SEC. In addition, on today's call, we will reference certain non-GAAP measures as well as certain market and industry data. Information regarding these non-GAAP measures, including reconciliations to GAAP measures is in our earnings release and earnings presentation. Information regarding market and industry data, including sources is in our earnings presentation. Now let me turn the call over to Billy.

Thanks, Ashley. Good morning, and thank you for joining our second quarter earnings call. We delivered another outstanding quarter, generating the second highest quarterly revenue in our history and building on the record performance we achieved last quarter.

Through the first half of the year, we've generated nearly $1.2 billion of revenue, almost matching what we delivered in all of 2022. Just as importantly, our growth accelerated as the quarter progressed, with June revenue increasing more than 20% year-over-year. Unlike prior periods, this performance wasn't driven by a single episode of elevated market volatility. Instead, it reflects something more durable, deeper client engagement, broader adoption of electronic trading across our markets and the benefits of investments we have made over many years in technology, workflows and connectivity to capitalize on structural opportunities.

The backdrop of our business remains constructive. Even as the macro environment continues to be debated, clients are navigating a world shaped by changing interest rate expectations, persistent fiscal deficits, geopolitical developments, elections, regulation and rapid technological innovation. Primary issuance remained healthy across the U.S., Asia, Australia, the Middle East and South America, while Europe is showing encouraging signs of renewed activity.

At the same time, there remains considerable uncertainty around the path of monetary policy, the global economy and increasingly the role that artificial intelligence will play across industries. Markets continue to process these questions, and that ongoing debate is exactly what creates opportunity for our clients to manage risk, reposition portfolios and access liquidity through our global network.

Looking ahead, we believe the future of Tradeweb will continue to be defined by evolution rather than disruption. Our leadership positions across multiple asset classes provide a unique foundation to embed greater intelligence across the trade life cycle. We believe AI, automation and data will accelerate the continued electronification of financial markets by helping clients discover liquidity more effectively, make better decisions and operate with greater efficiency.

Data is becoming increasingly valuable, not simply as an input into algorithms, but as a foundation for better insights before, during and after every trade. We are continuing to invest across analytics, execution and post-trade workflows while exploring new opportunities at the intersection of traditional finance, emerging technologies and evolving market structure. Regardless of how markets evolve, our objective remains unchanged.

We are focused on helping clients navigate increasingly complex markets with technology that simplifies workflows, enhances decision-making and delivers better outcomes. Diving into the second quarter, strong client activity and a risk-on environment drove 9% year-over-year revenue growth on a reported basis. Our international revenues continue to scale higher with 14% revenue growth as our strategic initiatives across Europe, APAC and EM continued to pay off.

International really continued to fire on all cylinders for us this quarter, contributing 65% of our overall revenue growth. And importantly, that strength was broad-based as we saw growth across all 4 asset classes from our international clients. We continue to balance investing for growth and profitability as adjusted EBITDA margins expanded by 24 basis points relative to the second quarter of 2025.

Turning to Slide 5. We produced the second highest quarterly revenues in our history across rates, credit and equities and market data. Our rates revenues were driven by continued organic growth across swaps, global government bonds and mortgages. Credit revenues were led by strength across global corporate bonds and credit derivatives. Money markets revenue growth was led by global repos and ICD. Equities were led by growth in global ETFs and equity derivatives.

Finally, market data revenues were up over 20% year-over-year, driven by our LSEG market data contract and proprietary data products.

Turning to Slide 6. I will provide a brief update on a few of our focus areas, U.S. treasuries and ETFs, and then I will dig deeper into U.S. credit and global interest rate swaps. Starting with U.S. Treasuries. Following the pickup in average intraday volatility in March, market conditions began to moderate in the second quarter with volatility down 20% from March levels. Even in a more measured trading environment, we continue to outperform.

Our second quarter market share increased to 22.5%, up 100 basis points year-over-year, leading to mid-single-digit revenue growth that outpaced overall industry volume growth by roughly 300 basis points. Looking ahead, we remain constructive on the long-term opportunity. Structural tailwinds continue to strengthen from sustained government debt issuance to the steady electronification of trading workflows.

As clients increasingly migrate from voice to electronic execution across both our institutional and wholesale channels, we believe Tradeweb is exceptionally well positioned to capture that growth. Institutional U.S. Treasuries were once again a standout performer with revenues increasing nearly 15% year-over-year, reflecting deeper client engagement and continued adoption of electronic workflows.

Our competitive position remains strong. We surpassed 50% share in electronic institutional U.S. treasuries for the ninth consecutive quarter and further widened our lead during the period. Our strategy is straightforward. First, we look to continue to win wallet share from clients trading electronically by demonstrating the value of our workflow, data and automation capabilities with AIX serving as a key differentiator.

Second, we are expanding our electronic addressable markets by bringing historically voice-based trading activity onto our platform. We're particularly encouraged by the momentum we are seeing in basis and multi-leg trades, 2 large and strategically important workflows that have traditionally remained predominantly voice-driven. Combined, average daily volume across these initiatives grew in excess of 40% year-over-year in the second quarter.

And with a strong pipeline of clients and dealers, we believe momentum will continue to compound over time. Our wholesale U.S. treasury saw revenues decline 1% as strength across our sweep protocol was more than offset by softness in our wholesale streaming offering. While competition remains intense, wholesale continues to remain a strategic priority for us. We believe our opportunity extends well beyond competing on price alone. By broadening our execution capabilities, introducing new protocols, expanding our liquidity network and deepening client relationships, we are building a more differentiated platform that we believe positions us well for long-term share gains.

Turning to equities. We continue to see clients embrace more automated trading workflows as they seek to improve execution quality, efficiency and consistency. As ETFs become an increasingly important vehicle for portfolio construction and risk transfer, institutional investors are looking for solutions that can seamlessly combine liquidity, automation and intelligent execution across a broad range of market conditions.

We believe that continues to be a meaningful opportunity for Tradeweb. Against that backdrop, ETFs posted revenue growth in excess of 10% year-over-year despite a normalization in market volatility. Client engagement continues to increase, and our AIX automation solution continues to be a key differentiator. AIX average daily trades were up over 45% year-over-year with triple-digit growth in U.S. ETFs and double-digit growth in European ETFs.

Our efforts to broaden our equity presence beyond our flagship ETF franchise continue to pay off with record institutional equity derivative revenues up 20% year-over-year. Looking ahead, the pipeline remains strong as the benefits of our electronic solutions continue to resonate with our clients.

We believe we are well positioned to capitalize on the long-term secular ETF growth story not only directly within our equity offering, but also beyond it as ETFs change behavior indirectly across our fixed income business. We believe this differentiated position will become increasingly valuable over time.

Turning to Global Credit on Slide 7. The business delivered low single-digit revenue growth during the quarter. That performance reflected continued strength across many of our strategic growth areas, including strong double-digit growth in international credit and U.S. institutional credit. Strength here was offset by weakness across municipal bonds and our retail credit channel, where revenues were down 22% year-over-year, primarily reflecting better relative yields available in other products.

We continue to believe U.S. credit represents one of our most significant long-term growth opportunities. While portfolio trading and sessions remain important differentiators, we see considerable runway to expand our RFQ presence as a larger share of institutional credit trading migrates to electronic execution.

As adoption continues to broaden across the market, we think our competitive advantage is increasingly being defined by workflow, data and automation rather than connectivity alone. Clients today are looking for technology that helps them source liquidity intelligently, minimize information leakage and achieve better execution outcomes. That is exactly where we continue to invest.

During the quarter, we continued to enhance SNAP+, which leverages predictive analytics and proprietary trading data to help clients identify the most appropriate liquidity providers for each trade. We also introduced TARA, our AI-powered trading assistant, which combines Tradeweb proprietary data, liquidity insights and artificial intelligence to help clients quickly transform market information into actionable trading intelligence.

This is a step change improvement from navigating multiple screens and manual workflows. Early feedback has been very encouraging, and we expect Tara's capabilities to continue expanding as we incorporate client feedback and further embed AI across our platform. Our position within block trading also continued to strengthen with record overall U.S. credit block share up over 115 basis points year-over-year in the second quarter with block average daily volume growth of over 30% year-over-year across IG and high yield.

Growth was broad-based across portfolio trading, RFQ and sessions, demonstrating the value of our multi-protocol approach. Just as importantly, our efforts to expand into RFQ are seeing continued signs of success, reaching another quarterly market share record, reinforcing the progress we're making in one of the largest opportunities within electronic credit. Specifically, institutional RFQ average daily volume grew 15% year-over-year with double-digit growth in both IG and high yield.

Portfolio trading also delivered another record quarter with average daily volume increasing more than 30% year-over-year with strong double-digit growth across both U.S. and international portfolio trading. Meanwhile, AllTrade generated the second best quarter in our history with over $225 billion in volume with average daily volume up over 13% year-over-year. Our all-to-all average daily volume grew over 25% year-over-year, and our DRFQ average daily volume grew nearly 30% year-over-year. We also continue to expand network participation, driving record responder rates in high yield as we broaden liquidity across the platform.

Looking ahead, we remain confident in the long-term outlook for global credit. Electronic trading continues to evolve beyond simply digitizing execution. Clients increasingly expect intelligent workflows that seamlessly combine liquidity, data, analytics and automation. We believe Tradeweb is uniquely positioned to deliver that integrated experience across protocols, products and regions.

We are seeing that opportunity play out across our business. During the quarter, we launched electronic spread trading across European credit, further expanding our workflow offering in a differentiated fashion. We are also seeing strong momentum in EM credit, where revenues grew 20% year-over-year in the second quarter. While electronification in EM credit remains in its early stages, we continue to build on our established global network and broad EM product suite to support growing client adoption.

Together, we believe these initiatives position us well to capture the increased adoption of electronic trading and credit.

Moving to Slide 8. Global Swaps delivered its second highest quarterly revenues, up 13% year-over-year. The performance was driven by a combination of strong client engagement across our global suite of currencies. Just as importantly, our core risk market share, which excludes compression activity and is the best indicator of our underlying franchise, reached another record, rising 207 basis points year-over-year.

Total market share moved from 22.5% in the second quarter '25 to 24.1% in the second quarter '26. One of the strengths of swaps is its diversification. While it's often viewed as a monolithic product, it is really a collection of different currencies, instruments and protocols, each responding to its own macro and client dynamics. This quarter was a case in point. As central banks around the world, including the Federal Reserve, the ECB and Bank of Japan turned hawkish and reshaped monetary policy expectations, clients remained highly engaged in managing interest rate risk.

Emerging markets extended their momentum, while our developed market franchise also stayed active, contributing to our second highest quarterly revenues overall. Taking a step back, the long-term picture has been one of steady structural growth. Over the past decade, the swaps market has expanded along 2 important dimensions. First, the amount of risk outstanding as measured by open interest has roughly doubled to a record.

Second, that risk changes hands approximately twice as frequently as it did 10 years ago. Together, these 2 trends have compounded into roughly 14% average annual growth in swap volumes over the past decade.

Looking ahead, we believe those structural trends remain firmly in place. As governments and corporations continue to issue debt, the stock of outstanding risk should continue to grow. And with only around 30% of the swaps market trading electronically today, there is substantial room for growth as we look ahead.

Tradeweb has steadily gained share in the global swaps market. Over the past 10 years, our swaps revenue has grown by more than 20% annually as we have expanded across emerging market swaps, strengthened our developed market franchise and continue to innovate across both the cleared and bilateral swaps market.

Our RFM protocol continues to gain traction, and we're investing across automation, workflow and execution tools to help clients trade more intelligently and efficiently. Taken together, we believe global swaps remains one of our largest, diversified and most durable long-term growth opportunities across our business.

Turning to Slide 10. Technology is helping to make financial markets more connected, more intelligent and more automated than at any point in their history. If there is a single thread running through our franchise, it is that our clients are increasingly relying on technology to make better decisions and execute with greater speed, precision and scale.

We believe that trend is still in its early innings. Our best example of that evolution is AiEX, our intelligent automation platform. Since launching AiEX in 2012, automated trading activity has grown meaningfully. And today, 45% of all institutional trades executed on Tradeweb flow through AiEX. Adoption continues to broaden across regions and products, particularly in markets that historically have been less automated.

What's exciting is that we believe automation itself is evolving. Historically, automation has been rules-based. Clients define the parameters, the AiEX executes those instructions with consistency and precision. More recently, we've introduced dynamic capabilities that adapt to changing market conditions in real time while remaining within those client-defined guardrails.

The next chapter is even more compelling. We see AI moving beyond simply automating workflows to augmenting judgment. Rather than just executing predefined instructions, we believe AI has the potential to help clients answer increasingly complex questions.

When is the optimal moment to trade, which protocol is most likely to achieve the best outcome? How many dealers should participate? How should a portfolio be sequenced across products and markets. These are decisions that have traditionally relied on years of human experience, but increasingly can be informed by data, context and machine intelligence.

This is where Tradeweb's competitive advantage becomes even more powerful. Every day, our network connects thousands of institutional participants across rates, credit, mortgages, ETFs, money markets and equities around the world, which creates one of the richest and most diverse sets of market intelligence anywhere in global fixed income and electronic trading.

As AI becomes more capable, we believe the breadth of our network, the quality of our data and the trust our clients place in us will become increasingly valuable. And with that, let me turn it over to Sara to discuss our financials in more detail.

Thanks, Billy, and good morning. As I go through the numbers, all comparisons will be to the prior year period, unless otherwise noted. Slide 11 provides a summary of our quarterly earnings performance. As Billy recapped earlier, this quarter, we saw our second highest revenues of $559 million that were up 9% year-over-year on a reported basis and 8.3% on a constant currency basis given the weakening dollar.

Notably, we delivered that growth even while lapping a difficult April comparison. Recall that April 2025 was one of our strongest months on record, benefiting from the exceptional volatility that followed the implementation of tariffs. Even with April revenues down low single digits against that backdrop, the quarter still compounded to 9% growth, underscoring the durability of the business across environments and the accelerating growth we saw through the quarter.

We derived approximately 44% of our second quarter revenue from international clients and recall that approximately 30% of our revenue base is denominated in currencies other than dollars, predominantly in euros. Total trading revenues increased 8%, comprised of 9% variable trading revenue growth and 5% growth across fixed trading revenue.

Rate fixed revenue growth was driven by the addition of dealers to our mortgage, swaps and U.S. government bond platforms as well as existing dealers opting for higher fixed fee plans and some increases in minimum fee floors. Credit fixed revenue declined slightly due to a smaller dealer stepping away from the credit market. Other revenues of $7.9 million for the second quarter increased 1% year-over-year, driven by an increase from ICD-related marketing partnership revenue, which was partially offset by a slight decline in revenue tied to periodic technology enhancements performed for our retail clients, along with slightly lower super Validator fees associated with our commercial relationship with the Canton network.

As a reminder, our other revenue line will remain variable from quarter to quarter, reflecting fluctuations in a number of factors, including the number of Canton coins earned, the value of Canton coins, the number of super validators in the network and periodic technology enhancements for retail clients. For modeling purposes, we believe the second quarter is a reasonable quarterly run rate for the remainder of the year as Super Validator fees are expected to moderate with the addition of new validators to the Canton network, reflecting the continued expansion and strengthening of the network.

Second quarter adjusted EBITDA margin of 54.4% increased by 43 basis points on a reported basis when compared to our 2025 full year margins. Our net interest income of approximately $18 million increased due to higher cash balances, which offset lower interest yields. Lastly, GAAP results this quarter reflected a $7.3 million net gain from unrealized gains and losses across our strategic investments.

As a reminder, this portfolio is designed to invest in emerging areas like digital assets, tokenization and prediction markets. So results here will fluctuate from quarter to quarter. Moving on to fees per million on Slide 12, we provide a highlight of the key trends for the quarter. You can see Slide 18 of the earnings presentation for the full detail regarding our fee per million performance this quarter. For long tenor swaps, average fees per million were down 10.3%, primarily due to mix shift within our currencies and lower duration.

For cash credit, average fees per million decreased 11.4%, primarily due to a mix shift away from higher fee per million munis and retail credit and towards lower fee per million European credit and portfolio trading.

Slide 13 details our adjusted expenses. At a high level, the scalability and variable nature of our expense base allow us to continue to invest for growth and grow margins. We have maintained a consistent philosophy here. Adjusted expenses for the second quarter increased 9.4% on a reported basis and 9.9% on a constant currency basis. During the second quarter, we continued investments in tech and communications, digital assets, tech consulting and client relationship development.

Adjusted compensation costs grew 1.6% as higher headcount, which was up 10.3% year-over-year and higher equity-based compensation were largely offset by lower discretionary and performance-related compensation. Technology and communication costs increased 38.9%, primarily due to our continued investments in data strategy and infrastructure and increased software costs, including AI.

Approximately $5.2 million of the increase was driven by investments in our data infrastructure strategy and higher reference data costs, both of which began in the second half of 2025. Adjusted professional fees grew 17.9% due to an increase in tech consultants as we continue to augment our offshore technology operations.

Occupancy expenses increased 39.1%, primarily from increased rent due to the move to our new New York City headquarters, which came into effect in the third quarter of '25 and data center rent expense. Adjusted general and administrative costs increased 4.9%, primarily due to a pickup in travel and entertainment, but partially offset by favorable FX movements.

Favorable movements in FX resulted in a $0.7 million gain in the second quarter of '26 versus approximately a $2.2 million loss in the second quarter of '25. Excluding FX, adjusted general and administrative costs grew 22.2%.

Slide 14 details capital management and our guidance. On our cash position and capital return policy, we ended second quarter in a strong position with approximately $2.1 billion in cash and cash equivalents and free cash flow exceeding $1 billion for the trailing 12 months, representing strong year-over-year growth of approximately 13%. We also held approximately $1.6 billion Canton coins with a fair value of approximately $230 million.

With this quarter's earnings, the Board declared a quarterly dividend of $0.14 per Class A and Class B shares, up 16.7% year-over-year. During the quarter, we stepped up our share repurchases, buying back approximately 1.9 million shares for $189 million as we took advantage of the dislocation in our stock price. There was $334 million of aggregate share repurchase authorization remaining as of June 30.

Turning to guidance for 2026. In light of our continued strong business momentum, we are maintaining our guidance for the adjusted expenses to trend toward the top half of the initial guidance range of $1.1 billion to $1.16 billion. We believe we can drive adjusted EBITDA and operating margin expansion compared to 2025 at either end of this range, although we expect the incremental margin expansion to be more muted as we continue to focus on balancing margin expansion with investing for the future.

Specifically, we continue to invest in frontier markets and opportunities to expand electronification across Asia and emerging markets as well as AI-related credit initiatives. We also continue to invest in technology that allows us to sustain and build on our leading platform. Some of these investments will take time to scale, but we continue to prize innovation and creating durable long-term growth opportunities.

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

Thanks, Sara. As we close out the first half of the year, I want to step back and talk about where the franchise stands. Our clients have navigated a lot over the last 6 months. And through all of it, Tradeweb hasn't just held its ground, we've extended it, deepening relationships across many of the asset classes we serve.

We tend to come out of complicated periods more relevant to our clients than when we went in because the harder the market gets, the more they lean into innovation. And the ways we can help them are only expanding, especially with AI. This is still a young shift, but clients are moving from experimenting with these tools to building them into their day-to-day faster than we could have expected even a year ago.

My conviction is that the firms that pair the deepest liquidity with the smartest technology will set the pace from here, and we intend to be at the front of it. The same drivers that powered the first half, deeper client engagement and broader adoption of electronic trading are already carrying into the third quarter. With 2 important month-end trading days left in July, which tend to be some of our strongest revenue days, average daily revenue growth is up low teens relative to July 2025.

The diversity of our growth remains a theme as we are seeing a preliminary strong double-digit growth across rates, credit and equities. Specifically, we are seeing double-digit volume growth year-over-year across global government bonds, global interest rate and credit default swaps, fully electronic IG credit and global equities. Our IG and high-yield share is tracking below June levels.

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

[Operator Instructions] Q&A will end at 10:30 a.m. Eastern Time. Operator, you can now take our first question.

And the first question is going to come from Alex Blostein with Goldman Sachs.

So I appreciate it's obviously early, but I was hoping to get your perspective on potential shifts in the competitive landscape for your products from the announced acquisition of MarketAxess by ICE. In particular, curious if you think about both opportunities that could come on the back of any dislocation and customer moves whenever there is an integration versus potential risks, I guess, both in credit and to some degree in rates.

Interesting times. Thanks for the question. Yes, so it's early. You're right about that. And obviously, as you know very well, like we know ICE. As you know, I like Jeff or I did, I should say, I still like him. He actually texted me this morning and said, sorry about this news coming out kind of as your great earnings are also coming out. So I accept your apology for the record, Jeff. I'm sure you're reading the transcript anyway.

We see it as a validation of the fee pool and credit to start with, Alex. And we do welcome, and I say this just like very clearly, like we welcome all of the time, like rational and commercial competition in the space. Ultimately, I think we feel very confident in our role as the trusted market venue that I think really ultimately understands the role that data plays in the relationship between the most important clients globally and their counterparties.

And I think that's a really important thing to say. We're in a sweet spot from my perspective, and I think that makes us all like super excited at Tradeweb. We're in a sweet spot around credit, right? As you know very well, the hyperscalers continue to sell bonds, central banks are less active in the space. The traditional banks have had just lights out kind of earnings.

At the same time, these nonbank liquidity providers are arriving en masse and in force in the credit space. That's a pretty good environment. And so as you know, like the market volumes have been growing. The pace of electronification continues to keep up and is increasing all along. And not surprisingly, what that means is like competition is here and has been arriving.

And as always, there have been and there will be kind of winners and losers around competition. And you know this very well, the ethos of this company is we are market share takers kind of period. And so we see sort of 2 things from my perspective. I think we see the opportunity inside of credit for the wallet to be restored.

We think we have a tremendous amount of opportunity to continue to invest in credit around the next chapter of growth, which we see as the use of technology, access to data and ultimately, I think something really important, which is the scalability of decision-making by our clients. We're going to be into a very, very interesting, I think, next chapter that I think is going to be defined by a few things.

It's going to be the continued rise of the nonbank liquidity providers, the systematic players in credit. But that rise needs to be balanced, I think, with something like super important, which is the traditional partner banks, the legacy banks in the space. And those are the keys to, I think, ultimately risk trading and has been a historic advantage from my perspective with Tradeweb.

the impact of technology inside of credit isn't anything to be diminished. So to start with protocol innovations matter and the market is becoming more sophisticated and ultimately more model driven. I think that plays to our strength. Do we get to a place where we get into this concept of kind of power law domination where winner takes most? I think so. And I think we're really, really well positioned to be that venue from my perspective as we get to this kind of like how we think about kind of virtuous cycle of data, automation solution, liquidity where liquidity begets liquidity.

And I think this is a really important moment for us. I say this very clearly. Ultimately, those who create a better value proposition are going to get the share. And I can say that with like perfect confidence. And I think in a really interesting way and I think an optimistic way just around what's happening in our world, Alex, I think there's no fighting technology.

And I think that's like a headline that should be out there and that we should think about. Everything in credit is pointing towards ultimately more transparency. And ultimately, I think that's the direction of travel. And from our perspective, that's the thing that makes us extremely excited about where we are in credit. So thanks a lot. Good to hear your voice. Interesting morning, as always.

And the next question is going to come from Tyler Mulier with William Blair.

There have been concerns on perpetuals potentially disrupting parts of the fixed income market. Are there any areas where you see genuine displacement risks and any areas where you could actually benefit?

Yes. It's a good question. I'm old enough to -- I think like I received that, like I forget like Bubagio, whoever the guy who wrote the original book on like bond trading like way back in the '90s, someone actually gave that to me and I read it, which is scary. But I think the short answer kind of is no. And I think it's actually like a very important question, and there's some technicality to it or technical mess around it. I think the short answer is no. We don't view it as disruptive across our core kind of financing and hedging markets that we live in.

I think the details do matter. Ultimately, first of all, like love innovation to start with. A perp is really ultimately think of it as a levered bet on price with no end date, which fit things in a very interesting way that never end. And we can talk about that from the perspective of like Bitcoin, stock indices, oil, et cetera. Bonds are essentially the exact opposite, right? A bond is an end date, and much of the returns comes from getting it shorter as it ages, something a constant maturity in its essence, can't capture, and I'm getting a little kind of wonky around this sort of answer.

So in a certain way, it doesn't solve a problem for asset managers, right? Mandates are written in maturity buckets. hedges have a lineup against actual bonds and swaps, which already give elongated exposure without a role, okay? And I'm explaining it like super technically. So we don't see it as a threat at all into our institutional business. Are we for innovation? Do we put our creative hats on and do we look at the world and say, where can this play a significant opportunity inside of Tradeweb, and we see that playing out inside of the retail world potentially.

And so we're excited about it. But we don't view it fundamentally as relevant inside of the institutional fixed income markets. I think it gives us this like very cool opportunity to expand our footprint to the extent that demand arises inside of the retail world, which has kind of, I think, in an important way, continues to surprise and activate everyone in terms of the growing sophistication of that population in that world. So I think you can kind of think about answering my answer around understanding the role that it plays and a willingness that we have as a company to always embrace innovation. And thanks for the question.

And the next question will come from Craig Siegenthaler with Bank of America.

We wanted to see if you have any metrics to help us evaluate the engagement levels with both, one, TARA, your brand-new AI system and also two, your new dedicated Kalshi pricing page. And I know you just launched them both in the back half of June, but we're curious on early engagement levels and also where you expect them to go to.

Yes. It's a great question. Good to hear your voice, Craig. And the timeliness, I think, around TARA interesting given the kind of news of today. So I appreciate the question. It's definitely still early days. And let me kind of like take a half a step back on your question. I think I say this all the time, we are going to be the most ambitious company that we can be. And part of that ambition ultimately relies on our ability to continue to be a leader in the core businesses that we are in and at the same time, place these very, very important bets in frontier space, which I think encapsulates your question like really well frontier space. So having like extremely strong client conversations this quarter on both TARA and Kalshi. And I think right now, our focus is trying to kind of engage with our clients and prove the value of this to our clients.

So start with the problem, I think, from our perspective that TARA solves. The challenge, I think the way I would describe it is the challenge for a trader today isn't by definition, kind of access to data. It's pulling the signal out of a large and growing data set really fast enough to act on it. And so hear me on that kind of point, right? TARA ultimately will move clients from data retrieval into something extremely important, which is insight generation. instantly right inside of their workflow across liquidity, pricing and historical context.

And as I'm describing all of that to you, Craig, you can hear the focus that the company is bringing to the space, specifically around this because it starts in credit. And over the medium term, I think we're going to expand it where it makes sense across product lines. And ultimately, it aligns, I think, really well with our vision of a kind of true multi-asset assistant here.

Early adoption in credit has been quite encouraging from my perspective, despite obviously something which is, as you know very well, like this is all new, right? And it's anything -- anytime something is new and there's the -- obviously, the agentic nature of the product. So it's forcing clients, I think, in a good way to revisit and rewrite compliance rules around this.

But we're super excited around directionally where this is going, and I think we're putting the right amount of effort and energy around this. And so that's a great thing. Kalshi is just like the best conversations we're having with our clients really has been around Kalshi because the Kalshi page from my perspective, I think, reflects the definition of something really important, which is like how the macro markets are continuing to evolve.

And clients are increasingly looking at kind of how we think about prediction market signals alongside their kind of core rates, interest rate swaps, government bonds, et cetera, and also credit strategies. And so we try to keep things simple. So we started with like a simple thing, which is a viewer that puts real-time event probabilities right next to swaps and treasuries in an easy and accessible way, intentionally low friction because step one, as always around these things is kind of discovery and learning, and we're getting like really good feedback around that.

Clients are returning and beginning to personalize their workflows, through filters and watch list. And these are like the technical things that we can see happening that from our perspective, matter a lot. And so things are going to get interesting, right? Prediction markets today are, as you know very well, Craig, like essentially retail. From my perspective, obviously, the opportunity is to build the institutional-grade version with the standardization, connectivity, execution quality and size that the biggest, most sophisticated institutions in the world expect. And in a certain way, as new as all of this is and as exciting as all of this is, that's in a certain way, the same playbook we run across fixed income for more than 25 years.

And I think it builds directly on what we already have, which is a broad network, execution infrastructure and ultimately, the seat on how this activity trades, be seat on how this activity trades. So 2 very big initiatives that you kind of asked the question on. Interestingly, I would say they're different initiatives, but I think connected by the same strategy. The ethos has to be lead with the client, prove the engagement and ultimately, the monetization opportunity, as you know very well, always comes on the follow. So a lot of focus on this from our perspective, and thanks very much for the question, Craig.

And the next question is going to come from Dan Fannon with Jefferies.

Sara, I heard you on the guidance for expenses, but I was hoping to get a little more detail on the incremental spend and where that's being directed. And then if we think about a revenue environment that maybe is less constructive, how do we think about expense flexibility in that type of scenario?

Great. Look, specifically, we're directing our incremental investments this year versus last year in 2 big buckets. The first group thing I would say is around longer-term investments and horizons that are fueling what we think are the next legs of growth and innovation for Tradeweb. And so there's 3 specific things I'd call out there that you've heard us talk about. One is data infrastructure and strategy. And I think I mentioned this in our prepared remarks. This quarter, we had a $5 million increase from last year as we really stepped up our spend significantly in the back half of last year.

But those investments support AI readiness, increased performance demands with the volumes we're seeing and a lot of our expansion, particularly internationally. The next bucket, I would say, and Billy just spent some time talking about that is AI client-facing innovation, which we think is really important. So those include areas like TARA and AI price and improvements in protocols like SNAP+ and AIEX, which we believe really are driving next levels of electronification in our biggest markets like credit and treasuries.

And those include people and non-comp investments. And then the last piece in that longer-term bucket that I'd call out is digital and frontier markets, which you've seen us talk about, but include organic things that we're doing in tokenized trading, such as intraday repo, crypto capabilities as well as Kalshi-related initiatives. So that's the first grouping that I would say is longer term. On top of that, we have a second bucket that I think is more nearer-term return and things that we are continuing to invest in that we started years ago that have clear traction, clear acceleration of revenue growth. And so those are areas like swaps and EM in Asia.

And so as you think about it, overall, your question about flexibility, even with these stepped-up investments and our new office and the hiring, about 45% of our expense base remains variable and discretionary. So we continue to see operating leverage. We remain confident in our ability to show margin improvement. And you saw that in the first half of this year, our expense grew 14.8% and margins expanded over 30 basis points. So at that top half of the range, adjusted expenses would grow between 11% and 14% for the full year.

We expect the second half to show slower expense growth relative to the prior year comparisons. And given our strategic priorities and enthusiasm on the outlook, we're continuing to invest, but we absolutely have the flexibility to slow down the pace of investments and a lot of flexibility in different environments. So thanks for that question.

And the next question comes from Ken Worthington with JPMorgan.

I wanted to follow up on Alex's earlier question. Where might Sprecher as a new owner and leader of MarketAxess make it a more formidable competitor in credit? So part of the pitch that Jeff made this morning is that having a fully integrated front-to-back ecosystem and leveraging economies of scale can increase activity and market share.

So Billy, does the pitch make sense to you? And do they have the pieces for that front-to-back ecosystem? And how does Tradeweb adjust here? I was going to say you've got plenty of cash on the balance sheet, you can fill in the pieces that you need. But ultimately, what's -- is there a response here?

Yes, that's a good question. And I don't want to be dismissive. But I'll tell you my very strong reaction is just like we have our playbook, and so therefore, we can be very opportunistic, but I'm reluctant to say that we have to adjust. And I will make sure I say that very kind of clearly around this. Because in some ways, what you're kind of describing, I don't want to like give Jeff too many kind of house secrets, but like it's a little bit of a strategy that we've been kind of building for nearly 30 years around kind of STP data execution, post-trade, TCA, et cetera.

We have a very strong kind of world view around the power of technology around the user experience and sales. And part of that sales has to be around ultimately aligning interests with the biggest, most important banks in the world, including JPMorgan. I'm not positive like how all of this that got announced this morning kind of easily solves in a very specific way how MarketAxess has been off sides around that for a while.

But I'll be kind of watching that in a way that you would expect, Ken. And we feel quite good about the playbook that we have running in credit, which is going to be a hyper focus on ultimately solving for more complexity and more risk trades. And what I think described before, I think is really, really important, which is the nonbank liquidity providers are arriving in force inside of credit.

The nuance it takes to actually solve for both the needs of those firms plus to make sure you're keeping the biggest, most important counterparty banks globally in the world [indiscernible] is everything. And I think Tradeweb's ability to solve for that is at the highest level and probably a big piece of the secret sauce that we've brought to the equation from the very beginning in credit. And maybe I just gave away a tiny little bit of a playbook there, but that's okay. And I think that's historically what we've been really good at and is going to be a version of the play that we continue to run.

So yes, continuing -- the optimism that we feel around where kind of credit is going, I think, was validated this morning. And I'm looking forward to kind of where the next chapter goes from here.

The next question comes from Michael Cyprys with Morgan Stanley.

I wanted to ask on rate swaps. Curious what you see as the biggest barriers to further electronification and swaps from here? And where are you seeing the fastest progress so far? And where can -- what can Tradeweb do to accelerate adoption as you look out?

Yes. It's a really good question, Michael. How are you? It's like all this kind of focus on this morning's news and credits that are like what a franchise that we have in our kind of global swaps business. So I appreciate the question. As you know, like in a really good way, I think the swaps market is sort of like a wash in complexity. And in a very specific way, I think that's where we thrive. Electronification, we know this like really well, has never been linear. It moves in phases as market structure, kind of regulation, liquidity and client behavior ultimately line up.

On the barriers, I think from my perspective, and it's amazing to say this kind of all these years later, I think the biggest one in a certain way is like simply like behavioral. Ultimately, moving real large risk electronically requires trust and a change in a certain way around kind of long-held workflows. And in the more complex corners, I think it also depends, I think, on something like really important, which is better data and ultimately more efficient post-trade. In a certain way, it's less a technological barrier than an adoption curve, okay?

So think about that again. It's like less a technological shift or a change and ultimately back to this concept of like human behavior shifting, which is something, I think, again, back to sales, interestingly, something that like we're really, really good at and really focused on. And so on where progress, I think, in a certain way is fastest, EM swaps is a huge standout.

We've helped to drive it to roughly 20% electronification and account for the majority of that activity. I think also, I think in a good way, breaking new ground in the more complex sort of like uncleared parts of the market with a series of kind of industry-first electronic trades there, which you've heard from us about and risk share keeps climbing as clients ultimately execute more risk with us. The big and really important kind of next frontier around all of this is kind of clearly, I think, from our perspective, wholesale.

And as you've gotten to know us really well over the years, as you know, as we've built out these big institutional markets and whether or not that is mortgages, government bonds, credit, et cetera, we've also built out mirroring liquidity pools electronically on the wholesale side in those markets. And the focus for us in swaps now, I think, in a really big way is now wholesale. In a certain way, just think about it very basically, which is like the institutional market is moving like 60, 70 miles an hour. and the wholesale market is going like much slower.

And I think as dealers win and manage more risk electronically, their need for more efficient tools and the ability to recycle and warehouse that risk electronically grows and we're going to have the connectivity from my perspective to be the winner as that market moves electronically. So here where our focus is around that and feeling like exceptionally good about what we've been able to accomplish globally within our interest rate business.

And the next question comes from Christian Bolu with Autonomous.

A couple of quick questions on your capital management strategy. You're sitting on north of $2 billion of cash. The stock is near its lowest relative multiple since the IPO. Yet you've only purchased about $250 million worth of shares This year. So just curious why you're not leaning in harder into share repurchases. And then maybe longer term, strategically, after you've done the crossover and the Kalshi minority interest investments this year, is sort of the next leg of the TAM story crypto execution of prediction market? And what would make you move from just doing minority investments to doing full-scale acquisitions?

great. Thanks, Christian. We continuously evaluate the size of our cash position relative to our capital needs and investment opportunities. And it's a good problem to have as we've grown, our business excels in generating cash. And so organic initiatives remain our top capital management return, and we're actively investing in areas like frontier markets and tokenization, Billy mentioned AI and agentic trading and international. But overall, to your point, in the scheme of producing $1 billion of annual free cash flow, we will have excess cash.

So right now, of that $2 billion on the balance sheet, we have about $500 million earmarked for risk capital and working capital, and that leaves about $1.5 billion of excess cash, which we've already stepped up on our share repurchases. And you can expect us, barring M&A and any restrictions to continue to lean in at these price levels.

As you mentioned, we've deployed the $200 million we have a little over $300 million remaining in our current authorization, and we are very open to opportunistically deploying against that. I did say the caveat on share repurchases, though, because while it's accretive at current levels, it's not nearly as accretive as some of the M&A opportunities we are evaluating in our pipeline. And our space is active, both on outright M&A and strategic investments.

So going forward, we have multiple things in the pipeline, both M&A and investment opportunities that we're evaluating. We find having that clean balance sheet and that solid cash position really allows us to be a nimble and attractive partner. Overall, I'd say, given that our confidence in our organic growth, we just will remain disciplined around acquisitions. So we're looking at things, but we want them to be accretive in the near term to EPS. We're not -- I don't feel any need to take on a high degree of execution complexity. And so there are things that we evaluate that are accretive and that we'll pass on, including last year, we spent some time on an acquisition.

But overall, our capital return, we're focused and we'll be opportunistic on share repurchases, and it's sized in relation to that overall inorganic pipeline. On your second point about the next leg around crypto and prediction markets, specifically, we see these frontier markets as potentially very large from a TAM perspective and transformational. And with both Kalshi and crossover, there plays on retail-oriented markets potentially institutionalizing.

So our minority investments give us a seat at the table real optionality in these markets that can be quite dynamic without committing heavy capital upfront. As we think about crypto in particular, we think that TAM for institutional crypto is likely to come along nearest term relative to the predictive market. We're seeing interest from clients pick up and the required mechanisms they need for institutional adoption. So things like custody, execution clearing are developing. Overall, our investment is performing really well, and we're quite happy with it. We're expanding our organic capabilities.

And I think our strategy right now lets us be efficient as regulation still is getting clarified and the market continues to develop more fully. So for us to go further in that, we want to make sure that we're getting something beyond what the partnership is providing us. We want clarity on some of those regulation dynamics and the financials on that market, just like you'd evaluate any other M&A opportunity.

With Kalshi, our investment here has also performed quite well, as you can see in the market. From a TAM, this is really a data story first, and Billy hit on this earlier. So we've really spent our time curating a set of event prices that are live on our trading screens. And you can imagine there's quite a bit of engagement, particularly on the Fed event contracts. And we see the development of that institutional market further out on the continuum. So I'd say we're quite happy with our investment strategy for now.

And the next question is going to come from Patrick Moley with Piper Sandler.

Just maybe a question on the outlook. You mentioned that revenues in July were trending up low teens year-over-year. I would love to hear how you're thinking about the setup for the rest of the quarter and into the back half of the year. And then maybe more specifically, with the new Fed leadership, maybe just your comments on how you see that benefiting the industry and Tradeweb moving forward.

Good question, Patrick. So I think your question is a really good one. I think you're right. I think that -- I think Kevin is -- I think he's a gift for our rates business in a very basic way. I think a market that has to form its own view is a better market for us. And I think we saw that yesterday. I think it was like 2 bonds steepened yesterday on a Fed day. It was a bigger [ steepener ] that it happened any time since like the mid-90s, right? So the change is real. I think 2 things to follow: Dispersion of view widens. So in a very basic way, instead of everyone trading off like the same signal, I think you get a genuine kind of 2-sided debate.

And price discovery sort of migrates from kind of 8 scheduled meetings to the economic calendar. So I think every print in a certain way now matters more. And that's a steadier drumbeat of activity and not like kind of like one big macro moment. So think about it that way. But as you know, I think, very well, and I think this has been one of the things that has kind of occurred through our business the most over the past year, we don't rely on volatility to drive our story. I think growth accelerated through the quarter.

As you know, with June revenue up 20% year-over-year, even as I think treasury intraday volatility fell about 20% from March levels. A livelier policy debate is upside on a base case in a certain way that doesn't need it. And I think that's kind of like an interesting way to say it, and I think you hear me on that. At a high level, and I've said this before, but I'm going to kind of reassert this, handful of themes, I think, that are driving ultimately client activity right now, growing issuance globally, obviously, across government bonds and corporate debt.

I don't think we can minimize how important kind of that is. More debt outstanding means more trading. More debt outstanding means more trading, diverging central bank rate outlooks, that kind of same dispersion of views. I've talked about how the banks are stronger than ever. I think that's a great setup for us. Something we don't talk about as much, I think, is the global dedollarization, which from our perspective, I think, pushes more activity into nondollar rates. one of the big kind of rises around our European swaps business. And I think clients are obviously increasingly using ETFs to express risk, which is a big deal, pulls more kind of credit and rates flow into a workflow that we already own.

And so as that activity grows, more collateral has to move, which accelerates in a certain way our financing business. So like a really, really good backdrop for us. And think about inside of that backdrop, probably a few things. swaps from our perspective, are the purest expression of a policy debate. It's the market where we're talking about record risk market share with a long electronification runway ahead, like really, really good stuff there.

In a certain way, I think like money markets are the underappreciated one. I think the Chair would rather shrink the balance sheet than raise rates. That unwind is going to drive our kind of U.S. repo growth. Less talk, more runoff straight into our kind of repo franchise. And I think we're really well set up kind of around that. So lots of stuff there. I think from our perspective, always, like the pace of electronification continues to grow. I think the backdrop is about as strong from our perspective as we've had and feeling really good about directionally where our businesses kind of across the board are headed. And I appreciate the question. Thank you very much.

And the next question will come from Simon Clinch with Rothschild & Company.

I was wondering, Billy, if you could talk about the opportunity in mortgages, particularly as you're sort of making strides into new areas like the spec pools, what kind of innovations, protocol launches would help electronic trading there? And how does that impact the overall fee per million sort of dynamic as well?

Yes. Great question. I made kind of a joke a couple of quarters ago that given the kind of historic role that Tradeweb has played in the mortgage industry that they were kind of -- I made the joke that they were my favorite child. And I think I'm like downgrading them -- it's like my third favorite child and putting like both a combination of global swaps and credit ahead of them now with all the focus that we have there, but that's okay. They don't know that. Great historic kind of business for us.

We've built a leadership position there for many years, and it continues to show results. So year-to-date, mortgage revenues are up kind of almost 14% with our institutional specified pool revenue growing more than 40% year-to-date. I was feeling quite bullish about where we were going with our mortgage business as 2026 was starting. I think I was bullish in some ways because I thought rates were going lower. And to see the performance of our mortgage business do as well as it's done in a higher rate environment, I think, speaks to the maturity of our franchise and how strong we are in that TBA market.

As you know, pools are different. Only about 20% to 25% of institutional trading in pools is electronic today, which in a certain way implies obviously a long runway there. We've been a leader in driving that transition. And today, we hold a share -- the leading share of institutional electronic pool market. It doesn't completely perfectly resemble like the credit market, but you can understand from a very basic perspective, it trades on spread. It tends to trade on bid lists and offer lists.

And I think there is a tremendous amount of innovation and transparency that we will continue to bring into the equation around the pool business. We have all the clients. We have the connectivity to the most important dealers. We have the reputation from the role that we play both on the wholesale and institutional side in TBAs. So we're bringing a pretty strong combination of things and focus into the equation, and we have the data. And so we feel really, really good about the role that we're playing in pools. It's a big area of focus for us inside of our rates complex. And then the other thing, which you know really well is that the pool fee per million is obviously higher because it's a less liquid instrument than TBAs.

We're commercial and just another reason why we're going to apply our kind of leading-edge lens into that area of the world. So busy company, as you know really well. And whether or not they're my favorite child or third favorite child, you're going to get a lot of focus from us as a company in that part of the mortgage complex. Thanks for the question. Appreciate it.

And this does conclude our Q&A session. And I will now turn the call back over to Billy for closing remarks.

Busy morning. Thank you all for joining us. As always, super appreciated. Any follow-up questions, obviously, feel free always to reach out to Ashley, Sameer and the team. Hope everyone has a great day. Thank you all so much.

This concludes today's conference call. Thank you for participating, and you may now disconnect.

Good afternoon, everyone. Why don't we go ahead and get started? My name is Jeff Schmitt. I cover wealth management and capital market stocks at William Blair. I would like to introduce Tradeweb. This is their first time at our conference. We're excited to have them.

They're the largest electronic fixed income trading platform in the market with just a great growth profile. And we're pleased to have with us the CEO, Billy Hult, to discuss the business. Thank you, Billy. And again, before we start, just go to williamblair.com for a full list of disclosures. So with that, I will hand it over to Billy.

Amazing. Thank you so much. Very nice. everyone.

Good afternoon. I'll get the most quick sort of like awkward piece of this presentation out of the way. I'm from New York, so I'm like a huge Knicks fan. So if you guys see me like running out of here, like catch the flight so I can watch the game, that's why.

So really excited to be here. I've been at the company for 25 years. I became CEO 4.5 years ago, President of the company since 2008. From my perspective, I see my job kind of like two ways. I go into the office every day and I say to myself, like what's the #1 problem the company is facing today, try to roll up my sleeves and get involved and engaged in that problem.

And then I'm extremely fortunate I think, because I get to as CEO, kind of like tell the story of who we are, what we do all of the time to amazing investors and amazing people. So I'm a very kind of fortunate person to be able to do that.

Tradeweb is a technology company, first and foremost, but we're a technology company that, from my perspective, I think, like just lives and breathes in the financial markets. And I think that's been the one thing that has differentiated us from the very beginning. We live and breathe in the financial markets. And from my perspective, I think we are at a really sweet spot in terms of the company and the business that we are in.

And so when I think about what a sweet spot means, I think it means a few things. And let me start by saying it this way, like obviously, like debt markets, private and public debt markets continue to rise. Private sector intermediation is back in vogue. The legacy banks because of this moment of deregulation, the legacy banks, the partner banks of Tradeweb are doing exceptionally well in the markets that we kind of live and breathe in. That's a really good thing.

And then as I describe all of that, I think something like exceptionally important is also happening, which is the nonbank liquidity providers, the firms like Citadel and the firms like Jane Street are [ indiscernible ] into our world. And they're not [ indiscernible ] into our world with any kind of conflict of like how business gets done. I wish things would go back in the past. I wish technology would go away.

I wish I could just get back on the phone and talk to my clients like a regular person, like, oh, no, we are going after market share through technology. And I think Tradeweb, given kind of how we've built markets, how we've partnered with our clients kind of sits in the catbird seat as these firms continue to accelerate into our world. So a really, really kind of interesting moment for us as a company.

When I look at our business and when I think about what Tradeweb does, I really think about it in a very kind of simplified way. So let me describe it for you.

Scale, we had over $2 billion in revenue last year for the first time. That's a big moment for us as a company.

Growth through a bunch of different kind of market environments, market cycles, you guys know this really well. We've had continued kind of mid-teen growth, really strong growth through a bunch of kind of different moments in time over the past bunch of years. So growth.

And then obviously, something very, very important, which is profitability. So while we've been kind of creating scale, kind of creating growth and creating profitability, we've been expanding our margins as we've done it. So really, really good.

And Sameer, you're doing something very interesting, which is you're changing the slides as I'm speaking. So go back for a second, don't rush me.

Scale growth and profitability, like major, like really big things. So let me just kind of say this very quickly, Sameer, and then I can nod at you, and you can do this muscle by the way going blind. It's okay.

Over the past 12 months, we've generated over $2.2 billion in revenue. I said that, trading roughly $2.8 trillion daily, okay? 15,000 trades a day across something very important, which I want to say this very clearly, 50-plus products, four asset classes, rates, credit, money market and equities. We serve over 30,000 clients across 85-plus countries, okay?

The biggest asset managers in the world, the biggest macro hedge funds in the world, we are that like really interesting piece of real estate that sits between those clients and their biggest liquidity providers, the Goldman Sachs, the Morgan Stanley, the JPMorgan, the Citis of the world. I always kind of say this, I think this is really important.

Like we have really important clients that are in our network. And I think we go out of our way to treat our clients really well. But we're also aware of something I think that's really important, which is like they're not more important clients to us than they are to the biggest banks in the world. So we kind of know where we stand like in the totem pole of the world, and we try to approach things that way.

Can you flip the slide, please, my friend? Thank you. So I say something like that I believe in, and I kind of write this down all the time, like live and breathe with our clients. The goal has been, from my perspective, like quite simple, be that one-stop shop for how they trade.

Technology is going to drive more convergence, being that one-stop shop is incredibly important. And so as we've been able to do all of that, I think we have quite a straightforward and pretty easy-to-understand business model. We earn revenues by charging our clients to trade on our platform. That's how we make money. And we have good revenue visibility given that roughly 23% of our revenue is fixed and the remaining 77% is variable and levered to volume growth in a great environment and a great business.

Slide 4 for a second. Thank you. I say this all the time. The market is dynamic. Obviously, it's changing all the time. Comfort zones and the way we think about comfort, there's no growth around comfort zones, right? So we're constantly understanding how do we push ourselves forward, how do we maintain our eye on preserving what we think of as leadership roles in legacy markets, at the same time, levering this big network into new opportunities. Momentum, as everybody here knows really well, continues to build momentum, and we feel that very strongly as our company.

So our constant focus is on giving our buy-side clients and dealers more time, a more cost-efficient way of trading. This has allowed us to compound revenue at roughly 16.5% annually from 2016 through 2025, while doing something that I said was very important earlier, which is expanding those margins over 1,525 basis points.

Maintain your leadership position in the markets that you're in, do not take your eye "off the ball", but continue to invest in new opportunities, build out and grow your business and still expand margins. That's a very interesting juggling act that I think as a company, we've been quite good at.

One of the reasons that we've been, I think, good at it is that our international business, our international revenue has been an absolute standout for us. So we've compounded at roughly 25% annually. We expect our international growth to remain a key feature of our story.

We don't have a kind of London satellite office that we stop by to and say hello to people at. It is a driver -- a thought driver of our business and one of the most important things that we've done as a company is really build out this international business.

I'll say this one, hopefully, cleanly, so you don't kick me on the way home, Sameer. After producing a top 10 revenue month in April, we followed that up by putting up nearly 15% average daily revenue growth in May, okay? That's a very, very important kind of comment that I want to make sure. I say properly, our international business shining again, producing nearly 18% year-over-year average daily revenue growth.

Slide 5. Thank you. If you are too focused on the past, and sometimes I do get focused on the past because I'm very, very proud of what we've been able to accomplish here as a company. Too focused on the past, too myopic and sort of overly worried about the present moment in time to make an obvious point, and you guys know this really well, I think you risk missing the future. And the future for us is how we define ourselves as a company.

Looking ahead, when you think about the long-term story, there are probably three things that I want to make sure I leave you guys with. One is really large total addressable market, right? So our TAM is huge. I mean, like $12.6 trillion of average daily volume, I feel like I'm in like -- not to say like gating myself like Austin Power is kind of a huge number of stuff.

And we're only about essentially 24% of that market today, right? Voice trading, the old way of doing business, it's 2026. There are markets that we are in, businesses that we are in that still sometimes have components of kind of like 1996, right? And the reason why kind of voice business still occurs today is that large trades, market-moving trades, big risk-oriented trades still tend to get done on the phone and complexity negotiation, those types of trades still get done the phone, right?

And so for us, the huge focus is on how do we migrate that phone business to electronic business. How do we get large trades broken down into more bite-size digestible trades efficiently processed through the market and how do we solve for negotiation and complexity.

So it's not just about the markets that are growing. Our clients are deepening their engagement with us across all of these products. Since 2015, I'm becoming like very good at stats as I'm reading, the number of clients that are active in three or more products is up nearly 300%, okay? That's a real leverage for us as a network. And those trading five or more clients and 10 or more clients have each grown over 175%.

That's again, like clear evidence that as clients do more with us, this concept of one-stop shopping gets stickier and our wallet share tends to grow. And that's how we kind of think about the business, I think, in a really important way.

Slide 6. We're already there. Thank you. These next two slides, I think, give a pretty good detail around how we think about focus as a company, U.S. treasuries, global swaps on Slide 6. We're going to get to credit in a second. We continue to attract new clients, deepen our wallet share, driving higher engagement with both existing and new products.

So the market goes like electronic, no one's happy about it, but these things happen in the world. I have a fair amount of enemies at Goldman, JPMorgan, Morgan Stanley. We can talk about all of that at some other time. Market goes electronic, that is truly when the innovation of that market like begins.

So there can be a sort of like default, I think, belief that once the market goes electronic, that's kind of like the end of innovation. It's actually the beginning, right?

So I said something I think that is truly important, which is we are a technology company, but we are a technology company that really kind of lives and breathes in the markets. When you live and breathe in it, you can understand that there are multiple cadences, multiple ways of doing business.

So Tradeweb, to make an obvious point, kind of lives and breathes in what we think about as like the RFQ space, the ability for BlackRock or PIMCO, large asset manager, central bank, big hedge fund to ask JPMorgan, Goldman Sachs, Morgan Stanley, Citadel for a quick price.

That is one way of doing business, but it's by no means the only way of doing business. The other ways of doing business can be different types of how we think about micro trading protocols. So the ability to ask one dealer for a large-sized trade to make a 2-sided market. I'm not going to tell you directionally which way I'm going, you provide me back a 2-sided market. If the bid-ask is within a certain increment, I will do the trade, okay?

It sounds kind of like wonky, a little bit technical. Figuring out these cadences is a massively important thing to do because the other thing that I said, I think, is also really true, which is we have these amazing clients, but they're not more important clients to us than they are to JPMorgan, Goldman Sachs, Morgan Stanley, et cetera.

So when you're living and breathing in this kind of trading world trading environment and you're creating electronification, transparency, all of these good things, you better get the rules of the road, the rules of engagement the right way. And so that's an example of how the market kind of continues to innovate.

The other way I would just describe sort of a version of that integration is everything that I've so far described and so far, we've been able to kind of talk about a little bit sort of revolves around the concept of the buy side being proactive in the market, looking to do a trade and ultimately, the dealer community reacting to it, okay? Buy side is proactive, dealers react with liquidity.

And then to make an obvious point, because there are a bunch of successful companies that have kind of lived and breathed in that interaction, that's important. But it's not the only type of cadence that exists in the market. The other types of cadence that exists in the market that still have so much room to solve for -- and solve around is the concept of, A, the dealers being proactive to their most important clients through either inventory or trading access; and B, the concept of how we think about reverse axis, which is I'm a big, big important large client, and I have something of such size to do that I'm not just looking for general liquidity in the marketplace. I'm looking for a natural buyer or a natural seller in the business to respond back to.

So I'm describing those stories because I want to leave the impression that there's so much more interesting things for us to accomplish and so many different interesting types of cadence and protocols to continue to develop. It's quite exciting.

Slide 7. We went public like a bunch of years ago now. And we were a rate company. And I think there was -- from my perspective, and I'd like to joke around, but I'll say this like in a serious way, I think there's a lot of respect around what we had accomplished, but we were really like a rates company.

I think there were open questions from the investor world, whether or not we have the right stuff to really figure out credit. There was this feeling almost like if you're a rates company, you're a rates company, if you're a credit company, you're a credit company, the markets are really different, hard to figure them both out. We had grown up as a company from day 1 kind of competing with Big Bad Bloomberg.

So we understood the concept of competition like really early on. And we had felt like the incumbent in credit had not had a free run because they earned it, but we didn't feel like they had that kind of competitive force in the market that clients obviously tend to like.

When companies compete like clients win kind of thing. And so from our perspective, I think creating a viable credit trading platform as a public company has probably been one of the best things that we've done. And as we've done that, we've really done that in a couple of different ways, one of which was figuring out what we do pretty well and then incorporating that into our credit strategy.

So as everybody here knows very well, like the credit market trades on spread. As the leading government bond platform, we figured out a way to bring a government bond price into a credit trade. That was a differentiator for us. It added a lot of value to our clients. It doesn't seem that complicated. Actually building it was kind of complicated.

And then the second thing that we wound up doing was saying like banks are fundamentally important in trading. And we are not fully supportive or fully engaged in the concept of ultimately dis-intermediating the banks from their clients. So this concept of like all-to-all trading, two buy-side clients kind of meeting out there in the clouds and exchanging liquidity, we didn't feel that was the most straightforward way of actually doing business.

So we went out of our way to bring the banks back into credit trading, and we did that through building out very interesting protocols, one of which we call and we talk about this a lot, maybe too much, we call portfolio trading. Big bid list, big offer list. I'm going to synthesize these lists into one all-in price and create liquidity off of one price. It's done quite well for us. So the credit story has been a good one, continuing to evolve.

Almost every time I'm on our earnings call, as you know very well, almost every question is about like where is your high-yield market share, where is your IG market share. The investor world tends to gravitate towards credit very specifically. We are extremely focused on our credit business, and we feel like we're in the best position to continue to gain market share there, both against the phone, our biggest competitor, the phone and also in the competitive landscape as well.

Slide 8. We never get to talk about our ETF business. But our ETF business has absolutely kind of crushed it. The way I kind of think about it is way back in the day when Tradeweb was this kind of rates platform, and we were looking for expansion, we were trying to figure out how to expand but not take our eye off the ball, do that kind of balancing act. We were in the kind of government bond market, the mortgage market, the European markets, all these rates markets.

And for us, like the swaps market was this big adjacent market. Company MarketAxess did also an excellent job because they were in the credit markets. They were also looking to expand. And so they obviously kind of identified the emerging markets business as their natural extension into something different and interesting and did quite well doing that.

ETFs were kind of like jump all, quite honestly, like we all kind of understood what they were, but neither company had a natural advantage towards getting into that market. I think our -- maybe not surprisingly, our relationship with BlackRock kind of helped us become kind of like the flagship venue for ETFs. I think we were starting to understand how big the ETF market could get. And we've built out and we've grown a really impressive and really strong ETF business.

If you guys were going to ask me like what's one of the sort of more important things that you wound up getting that's harder to see around this ETF business, I would say, not surprisingly, it created kind of access for us to the most kind of sophisticated players in the ecosystem.

I had mentioned to you all that like the nonbank liquidity providers, the Citadels, the Jane Streets, those types of firms are chaning into our markets. We got access to them not surprisingly because they play such a large role in the create and redeem process in ETFs. And I think that's given us a huge advantage as they continue to Korean into the more broad-based institutional markets. So lots of good stuff happening with ETFs.

Thanks, Sameer. I gave everyone kind of in an international business, a lot of props, not that anyone from trade even remotely looking at this, but that's okay. The EM revenue is a big deal, right? Because from our perspective, it was sort of twofold. We saw what MarketAxess did in EM. We were appreciative and respectful of that. We're still very big proponents of the market likes competition.

And then not surprisingly, we were a little bit like let's stick with what we're good at. Let's figure out our first foray into EM, which was EM swaps, EM rates. We've done really, really well with that. Big opportunity for Tradeweb to continue to accelerate and push forward in that EM credit world, showing this sort of like playbook that we've built out in credit, which is bring the banks in, add value into the trade process and then in a really, really important way, figure out protocols that add value to clients. We're going to run that playbook pretty hard in the kind of EM credit world for sure.

So first sort of -- I think like a little bit of the first kind of journey around what we've been trying to do, and I think hopefully been able to do well has been around kind of what I was describing before, which is this like first step of how do we get people to stop using the phone and to start using the electronic way of doing business, phone to the mouse, to the keyboard.

This next phase to make an obvious point, is going to be off of the mouse, off of the keyboard, off of the terminal into how we think about ultimately a smarter search or more algorithmic search for liquidity in the market.

A bunch of years ago, I think we went down the path of probably the most important thing that we've done as a company, which is embrace the concept that clients will look for liquidity away from just logging into Tradeweb or logging into Bloomberg or logging into any system, understand that clients are getting more sophisticated. They're looking to consolidate liquidity more easily and more quickly. Your liquidity is your gold mind and help and work with clients as they search for and find liquidity in the market.

And as I described all that, that is the early evolution of how we think about Tradeweb, our AiEX product, which has been a significant differentiator for us, Data around this is everything. The smart search for liquidity around this is everything. I remember like very early on going to visit great clients, and they were not just great clients because I like them. They were great clients because they use Tradeweb and they understood Tradeweb and they thought about what we were doing was really important.

And I would sit behind them and I would watch them do trades because there's probably no substitute actually for seeing how clients engage with your platform. And I would see how they would like send out a ticket on Tradeweb for like mortgages or government bonds or swaps, and it would be like sort of like Bank of America, Citi, Deutsche Bank, Goldman.

And I would, not surprisingly, just out of curiosity, like ask like why did you pick those four banks because you have like 10 banks to peg or 15 banks to bet and they'd like oh, just like tickets like alphabetical like A, C, D, G. And there's massive evolution and massive change from that random walk of liquidity.

So as we think about where this all is going, it's going to be smarter search. I'm no longer guessing where liquidity is in the market. I know where the liquidity is in the market. And I'm going to find that through the most trusted data, the most trusted liquidity source, the platform that actually understands how to use -- how to run the rules of the road the best way.

And the most -- the way with the most integrity. And I think that has been probably the most important thing that we've done, embrace where the future is going, not just around AI and machine learning, but around the concept that the entree into these marketplaces is not going to be through what's my log-in number, where is my mouse and where is the keyboard. It's shifting very quickly in interesting ways around that.

I said we're killing it there. That's okay. So you see the sort of like the Tradeweb story. I'm excited about it. I would say from my perspective, it's very simple, maintain our leadership role in these markets that we've built, understand that technology is going to continue to drive multi-asset class trading. We're in a really good position there. We certainly don't rest easy on that, figure out this concept of large trades, complexity, all of those things that exist in our day-to-day businesses. And to make an obvious point, the world is changing fast, right?

So be front-footed on this continued development around AiEX, around machine learning. At the same time, we are proactively making partnership investments around tokenization, around blockchain, around predictive markets. We're probably doing the things that you would expect us to do as a very ambitious company around where is the future going and how do we make sure we continue to position ourselves in the best way around that.

So that's been a real strong priority for us, maintaining our position, maintaining our leadership strength in core business and making the right kind of bets around how we think about around frontier markets.

We've been extremely fortunate as a company, not just to have such great clients, but to have, from my perspective, really strong kind of partnership relationships with these clients, firms like Goldman, firms like JPMorgan, firms like BlackRock, extremely well run and great firms.

In an interesting way, I said Citadel and Jane Street, they're fundamentally important. They're not like partners, right? They're not like out of central casting partners. They don't really like whiteboard with you. But as we've kind of built stuff up with them, created a little bit of credibility, we're getting into like the whiteboard moments. And so I'm able to sit down with the firms like Citadel or Jane and say, like what's the evolution of macro products going to look like in the next couple of years?

How do we think about Tradeweb getting access to allowing its clients to have access to gold pricing, silver pricing, Mag 7 stocks. Obviously, we're having the kind of conversations you would expect us to around can the crypto markets really evolve into institutional markets? Can the predictive markets really evolve into institutional markets.

So really, really interesting kind of fun time for our business. We're a focused kind of hard-working company. We're aware of the moment. We're aware of, I think, change continuing to come. I think making sure that you continue to sort of build out presences as a public company can be more difficult, but we are really bringing the kind of rigor that you would expect us to those kind of decisions and feeling quite good about the opportunity in front of us.

So I appreciate everyone's time, and thank you very much.

Thank you.

All right. Next up, we have a Tradeweb doubleheader. We have Sara Furber, CFO; and Troy Dixon, Co-Head of Global Markets. Tradeweb is a leading global electronic trading platform spanning rates, credit, money market funds or money market ETFs and increasingly equities. Fresh off a record quarter. It was the first quarter you ever put up revenues above $600 million. Sara, you lead Finance and Corporate Development. Troy joined the executive team from Tradeweb's Board at the end of 2024 after a career running a structured products fund on the buy side and some RMBS desks on the sell side. You now oversee Global Markets. So Sara, Troy, thanks so much for joining us.

Thanks so much.

Thank you.

All right. So kicking things off, Troy, we don't get to hear much from you on the earnings call. So I'd love to start off getting to know you a little better. I mentioned that you've seen and experienced Tradeweb from both the buy and sell side. So I would love to get your thoughts on what you thought of Tradeweb as a platform from those seats and what ultimately led to your decision to want to join the executive team.

Yes. Thank you for having me, Pat. So my background is I'm a lifelong mortgage trader, ran structured product trading at Deutsche Bank. And then 12 years prior to joining Tradeweb, I ran my own structured product alternative asset manager. And I joined the Board 3.5 years ago now. And so it's been an interesting journey kind of going from out of house to in-house. But I would say I've known Tradeweb from the very early days to kind of make you laugh a little bit. I remember when Billy and I go back 30-odd years. And I remember when he told me he was going to Tradeweb, and I'm like, where are you going? What are you doing? So I go back that far with him, and I was involved in sort of the first 2 consortium deals, both in the mortgage side and then as they built the credit business.

So I know the company really, really well. The thing I would say, both from a buy side and a sell-side perspective, Tradeweb has always been the white glove service from the standpoint of electronic execution platforms. They've already always had huge and high connectivity at a people-to-people level, which I felt like was important as you sort of try to figure out what the problems are and figure out solutions to those problems and going back both buy side and sell side. I think though, the epiphany for kind of me and Tradeweb and kind of part of the reason or the main reason why I decided to come in-house was there's a couple of things. One, I realized in getting on the board the unique spot in the overall ecosystem that Tradeweb held.

As I thought about the progression of how important technology smart order routing and at the time, machine learning around doing your relative analysis was becoming, I realized that technology was going to be a more important part of that execution process once I got on the Board. And I looked around and I said, Tradeweb had over the last 25 years, it carved out a really unique space within the overall universe. And so when Billy first kind of approached me around coming in-house, I was, one, humbled, but two, I was excited because I -- and being on the Board, I recognize that like if we think about the data that sort of flows through the pipes of Tradeweb and we think about the future of execution and the global nature of how people are transacting, there's nobody sort of footprinted like Tradeweb, and I was excited to come in and sort of help try to lead the company to the next iteration. So -- and it's been an exciting 16 or 17 months since I've joined, and I couldn't be happier.

Great. Well, thank you for that, Troy. Maybe shifting gears to the environment. I know you'll be posting May volumes and metrics tomorrow, so you might be limited in what you can say about May. But could you just walk us through what you're seeing across the business broadly? How is the macro environment and geopolitical uncertainty kind of shaped client conversations and activity year-to-date?

Yes. I mean I can tell you, May has been a really healthy month for us. And so we have definitely seen a pickup in client activity. Average daily revenues for May are up nearly 15% year-over-year. So structurally higher than May last year and also a pickup from some of the more muted client activity we saw in April. So we're feeling really good about the environment. It's interesting to see given you wouldn't even say May has necessarily been the most volatile month. And so I think it shows the engagement of clients on our platform and the breadth and the increase we've had in innovation. When you think about macro, I mean, year-to-date, we've seen a lot of action, right? We've seen a lot of debate on rates. We've seen debates on inflation.

We've seen oil prices, geopolitical uncertainty. And as we look forward, I think we expect to see a lot of variables and a lot of debate continue, particularly globally on rates, and certainly more change coming with the Fed. I think where we sit, we feel like that environment is really good for our business, right? We've got rising global debt levels. We've got the banks very active and engaged. We've got hedge fund clients expanding globally. And so as we think about our ability to innovate, solve problems for clients and have debate in the market around multiple asset classes and multiple geographies, I think it's a really positive environment for our business.

Sure. And I think that's a good intro to my next question. Rates is half of your business, half of revenues today. Global swaps is a big one. That's a market that remains roughly 1/3 electronic. Maybe, Troy, from your seat, where are you seeing marginal adoption happening within that business? And how do you think about the pace of swaps electronification over the next few years? And then if I could add on to that, perpetual futures has become a big talking point recently. What sort of -- how are you thinking about perpetual futures globally and any maybe disruption risk that it could create in any of your markets?

So obviously, swaps has been sort of the bellwether business for us over the last several quarters. And I think there's this anticipation that, that can't continue in perpetuity. But as we step back and think about that overall footprint of the market, right, you mentioned it's roughly 30% electronify, right? And then we kind of break it down into sort of 4 -- 3 or 4 categories, right? We've released RFM into the swap space as a protocol, and we're starting to get pretty good adoption. That is in an effort to start to move some of the large bulk risk transfer trades from voice to our platform. And we're early days, but we're getting a lot of great feedback on that.

And it's interesting, right, because RFM isn't this new protocol. It's just we're now applying different protocols across different portions of our platform, and we're really excited about that. The other thing we've sort of focused on is one of the products that effectively has no electronification is uncleared swaps. That's a huge universe of waterfall that potentially will go from behind the scenes to in front of the scenes from our perspective and the transparency around that product will continue to grow. And I think we are in a very good situation with regard to being able to monetize that and working very closely with both buy side and sell side as we figure out the electronification of that platform. And if you think about it just from a metrics perspective, the unsecured space is as big as the secured space.

So when you guys think about like the revenue generation that we've had in the swap space over the last several quarters and then you dovetail that into a swaps market that sits side by side and the large players in one of the same large players in the other, I think we have a unique right to win, and we have huge connectivity right now and trying to figure out the railings in that business. We also kind of talk about our emerging markets swaps business, which continues to grow at a pretty large rate.

And it's a scenario where we're able to lever our dollar swap business and our euro swap business into some of these emerging markets because they -- obviously, if they're trading emerging market swaps, they're also trading either dollar or euro swaps. So we have this nice glide path into creating that platform, and that platform is roughly 20% electronified. So there's tons of greenfields from our perspective on that. And then the last sort of vertical is the wholesale space. Quite honestly, wholesale for whatever reason, has sort of lagged electronification as a general rule, but the footprint, we think the TAM is a massive TAM.

And for whatever reason, that has sort of not moved in the same way as cleared on the institutional side. We do think that the bank's immense pressure on fees, which we see every day, will pressure that off-screen execution to come on screen in the wholesale space. And again, I think we sit in the catbird seat with regard to monetization of that space. So swaps as a general rule, we think, are in the third -- second or third inning around the electronification, and we've spent a lot of time and energy. And as I said, I started using white glove service to sort of figure out the problems and help to create the solutions.

The perps thing is an interesting one, obviously, very topical. And obviously, a lot of conversation on it over the last couple of days as the stock price has sort of moved. But as we think about perps and I think about perps in my former life as a fixed income trader, it's really competitor to futures, right, because of -- you don't have to put up a bunch of margin and it's a short-dated exposure. And so -- and quite honestly, we're not novices in the perps space. We've been spending a lot of time and energy on like what does a perp look like? Do we launch our own perp and we serve as the Oracle? Do we use a platform like Hyperlink around platform. So we've spent a lot of time and energy.

But our thought process on it, quite honestly, was it will create greater velocity of fixed income markets, and it doesn't really compete on our cash business, which is where we make our money. And so our theory was it just creates more hedging, more basis, more risk on, if you would, from an overall macro standpoint. And so we looked at it as additive from our platform, but obviously, the stock price is telling a slightly different story, but we feel firmly on that point. But if you take a step back also, if you think about that product, right, and the relationship that we've already built with Kalshi, there's a theory where if that does become a tradable instrument, it trades on our platform, particularly if you think about it going from historically perps and historically a retail product to an institutional product, it makes sense that Kalshi and us will work on institutionalizing that product set.

And then the last point I'd make on is from a regulatory standpoint, the CFTC approved Bitcoin perpetual. I think there will be a lot more individuals or institutions opining to the extent that, that moves into like core fixed income assets, where obviously the CFTC has a lean towards figuring out crypto and moving the velocity of that particular product set. I think there'll be a lot more debate as we think about this if perps was to move into other products. So at the end of the day, I feel like a vibrant perps market in fixed income actually benefits and it creates greater basis trading and greater velocity. And so we're sort of -- Sara and I have been scratching our heads a little bit on that topic.

Do you think -- just as a one-off, do you think there's more institutional interest for prediction markets today or perpetual futures?

Prediction markets. And the reason I say that is perps, you have a natural offset to like not using perps and using futures. Whereas prediction markets because of their binary structure, there really isn't anything that's sort of uniquely the same as binary. And I've said this in many of my conversations is like I used to say when I ran big trading desk, I said, listen, if I gave -- I say to my younger traders, if I gave you the employment number, it's not guarantee that you actually make money because markets react in different ways.

But to the extent you have a prediction market where there's a binary outcome, if I give you an employment number, you're going to make money. And I think that uniquely sets up well for Tradeweb because in theory, and I go back to my trading days, if I can isolate the one part of my risk that I don't like and hedge that out, in theory, I take bigger risk, right? So I create greater volumes. And so I think that's where I think institutional footprint views prediction markets relative to perps.

Sure. All right. So let's talk about international growth. You've been one of the more aggressive U.S. names in building an international footprint in your sector. In the quarter, you reported that 44% of the revenues came from international. Where do you see that going from here? And what are you looking at as the most compelling growth opportunity outside of the U.S.?

Yes. I mean international has been a huge growth driver for Tradeweb. You just quoted it. When you think about a $2 billion top line, 44% in the fourth quarter. So 40% of our business is coming from outside the U.S., 60% of our revenue growth is coming from international. And so it's a major driver. Within that, the 2 biggest areas that I think we are really excited about EM, which you've alluded to, that's a business that's now run rating over $100 million for us and growing well in excess of 30%. And then APAC.

And obviously, APAC is a number of different markets combined. But that market for us is large. We've bolstered it with an acquisition for Yieldbroker in Australia a few years ago. And when you think about that market, you also alluded to this, most of the markets in APAC are only 10% to 15% electronified. So those are 2 big compelling growth opportunities where we already have traction and scale and can keep scaling. Overall, I would say, particularly from my seat, it's not just 2 growth drivers. We always look for durability. And so in the first quarter, every asset class we had was up double-digit revenue growth in terms of international opportunities.

And then I think about operating leverage and the network effects that we're seeing. So we have international clients buying and accessing U.S. product. We have U.S. clients accessing international product, and that flywheel is continuing. So I think if you think about it, I think 60% of the revenue growth we saw in dollar swaps came from international clients. That's showing, okay, as that platform is scaling, you're going to see that benefit globally. Similarly, the U.S. client base is probably driving about 20% of that international product flow. And international isn't just one bucket, right? International is a lot of different countries, a lot of different markets, a lot of different clients in that region. And so from my seat, that's an acceleration of revenue flywheel, and it's also an operating leverage flywheel because you get to leverage the infrastructure investments that we've made in those products.

Sure. And you mentioned $100 million run rate in EM, another business that's become quietly a $100 million revenue run rate business for you is equities. It doesn't get talked about a lot, but it has consistently been a double-digit grower for you all. What's the strategic vision for that equities business? And what do you attribute some of the recent growth to?

Obviously, our equity business is focused around ETFs right now, and the ETF market has obviously grown significantly. I want to say our equity business has grown at north of 15% a year since 2020, right? And so nobody really talks about is that being one of our huge revenue streams. But now we're sort of working through options and extending that footprint past just the ETF space. And so obviously, we're super excited. We've sort of made that footprint through technology and innovation, which I think is sort of the linchpin of like how we've built businesses, where we've done like block RFQ in that space, and we've definitely garnered a fair amount of market share in this space.

And we really feel like it dovetails nicely into our credit business as well as you think about ETFs and underwinding of ETFs and like the underlying asset classes within that. So we're working hard to kind of figure out how we connect what is our institutional credit business with regard to our ETF business as well. And we think that there's a fair amount of TAM that we can excavate from that perspective if we get that right. So we're pushing forward both from a technology and innovation standpoint, connectivity standpoint. And obviously, as Sara said, that business is a global business. And so the opportunity is not just here in the U.S., we have a fairly large footprint in Europe as well.

Okay. One of the things I want to hit on in a lot of meetings today is AI. We've been talking about it. As AI trading becomes more automated and it takes hold and you see more AI trading agents being deployed, I think it's mostly going to be focused on retail right now, but how is Tradeweb positioning itself for that shift?

So part of the reason that I joined the firm is I felt like we were in a really unique spot with regard to AI. And the reason I say that is if we break down AI, it's really just a manifestation of data. right? And if you think about agents and smart agents, the fact that we have 25 years of data in rates, we have an extended amount of data in the credit space, both institutional, retail and wholesale. And then you think about the data we now have in the ETF space, there's just -- from our perspective, we sit in a very unique spot.

We -- I'll tell you a quick story. So we hired a woman Sherry Marcus to run our AI platform, right? And she's a very impressive background. So you look at her resume and it's like she worked AWS, she worked CIA or something and like I'm interviewing her and she's like -- and I wasn't really interviewing, we were having a conversation about me trying to talk her into coming. And I said to her like, Sherry, why do you want to come to Tradeweb? Like in theory, given like the prominence of AI and your background, you can go anywhere and do anything.

And in our office on our TV, it's at $2.7 trillion average daily volume. She said, that's why I want to come here. You guys have the data, and I can manifest it in a really unique way. And so that kind of was like the aha moment for me with regard to like our footprint and how important we will be in the execution and the evolution of AI as we think about transacting with each other. So early days, but Sherry has done a great job in her first 8 months. And I think part of the reason why I'm excited about where our credit platform is going is that's been her initial focus is around implementing a lot of our data into AI tools with regard to chatbot and our pricing model. And so early days, but exciting times.

Sure. Another big trend, Sara, that I want to ask you about is related to corporate treasurers where the keynote today is the DTCC CEO, they're looking to tokenize treasuries starting in July. But there's a lot of talk that tokenization could revolutionize corporate treasury management and really dramatically improve balance sheet efficiency for all kinds of companies. I've heard upwards of 40% to 60% for some financial services companies from tokenizing treasuries and improving efficiencies. You acquired ICD in 2024. How is ICD positioned for that trend? And is there a meaningful revenue opportunity there?

Yes. It's an interesting question. I mean I think Tradeweb as a whole is really well positioned for that trend, and we've spent a lot of time talking about Canton and work with DTCC in terms of some of the work they're doing to tokenize their collateral pool. Specifically to ICD, it's an acquisition we did 2 years ago. We're incredibly pleased with how it's performed. They had record results in the first quarter. But essentially, what it is, is a money market fund portal, but a portal for corporate treasurers to access and to manage their cash and short-term liquidity needs.

So today, there are a lot of traditional money market funds. One of the things we see as an opportunity as tokenized money market funds become more available, putting that onto the platform, and we're well underway on that work can alleviate certain frictions that corporate treasurers face. So you think and I think about myself as a CFO, there are times where you want to move money or liquidate funds after market intraday on the weekend. And those things aren't as easy in traditional money market funds and potentially the tokenized versions of them will enable some of that to happen more seamlessly. That said, corporate treasurers don't want to have a separate wallet, at least from the client feedback we've gotten and manage other complexity. They want it in the same format.

So ICD connects to a number of different systems that those corporate treasurers need to function. Think about a treasury management system. You want that same opportunity to sit alongside the other tools that you are using. And so from our seat, we think having that front door for corporate treasurers, having the trust in how we've onboarded something into the system and it's already connected is a big part of the potential opportunity. It's probably too early to say what the revenue opportunity is.

I think corporate treasurers are very measured in how they make changes. But we think having that toolkit alongside T-bills on our platform is really important. The other thing that I would say is, as you think about how a world evolves in a tokenized market, one of the other things that ICD is well positioned for is there are new scaled companies. They are crypto-native companies and the regulatory environment for them are changing. They can actually be clients of ICD in a way that didn't really exist 4 or 5 years ago. And so I think ICD is well positioned in 2 different parts of the balance sheet, so to speak, for the long-term trend as is the longer Tradeweb business.

Sure. And then maybe just, Sara, ending on a question about capital allocation, cash flow profile you have today. How do you think about the balance between M&A buybacks and dividends? And is there any appetite for larger, more transformational deals that make strategic sense? I think a few quarters ago, Billy might have hinted at something, but anything to say there?

Yes, sure. Big picture for everyone, the long-term philosophy on how we allocate capital is the same waterfall that everyone's heard from me. So we talk about organic, inorganic, share repurchases and dividends. Like our organic business, there's lots of opportunities, and we are more than able to fund that. From an inorganic perspective, we think about every tool in the toolkit. So things from principal investments, which you've seen us do a lot more of this year to M&A. And that can be bolt-on and larger M&A. What I would say about M&A is we have the cash, the excess cash on the balance sheet.

We obviously have the ability to pursue that. Strategic fit is really important. And we see a number of things. A number of opportunities are sitting on our pipeline that we are really excited about strategically. But the financial discipline is also really important. And so we want to see things that accelerate revenue growth. We want to see things that can help us produce more operating leverage, and we want to make sure that they're EPS accretive within a near-term horizon. The confluence of how you time pursuing those acquisitions is a combination of having that strategic fit and the financial discipline.

And I think we have a really good track record of being opportunistic and not chasing. So from our seat, I think that's really important. I would just say the only other piece is on the third piece of our waterfall when we're talking about share repurchases, we have accelerated our share repurchases. We think the stock is dislocated from fundamental intrinsic value. And so quarter-to-date, we've purchased nearly $100 million of stock. We have over $400 million left on the authorization. So we like that return of capital. That doesn't preclude our ability from doing any of the other measures. But on a near-term basis, that's certainly a use of cash that we think is a positive one.

Sure. All right. Well, I think that's a great place to end. Sara, Troy, thanks so much for joining us.

Thank you.

Good morning and welcome to Tradeweb's First Quarter 2026 Earnings Conference Call. As a reminder, today's call is being recorded and will be available for playback. To begin, I'll turn the call over to Head of Treasury, FP&A and Investor Relations, Ashley Serrao. Please go ahead.

Thank you, and good morning. Joining me today for the call are our CEO, Billy Hult, who will review our business results and key growth initiatives and our CFO, Sarah Ferber, who will review our financial results. We intend to use the website as a means of disclosing material, nonpublic information and complying with our disclosure obligations under Regulation FD. I'd like to remind you that certain statements in this presentation and during the Q&A may relate to future events and expectations, and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Statements related to, among other things, our guidance are forward-looking statements. Actual results may differ materially from these forward-looking statements. Information concerning factors that could cause actual results to differ from forward-looking statements is contained in our earnings release, earnings presentation and periodic reports filed with the SEC. In addition, on today's call, we will reference certain non-GAAP measures as well as certain market and industry data. Information regarding these non-GAAP measures, including reconciliations to GAAP measures is in our earnings release and earnings presentation. Information regarding market and industry data, including sources is in our earnings presentation. Now let me turn the call over to Billy.

Thanks, Ashley. Good morning, everyone, and thank you for joining our first quarter earnings call. We delivered another record quarter surpassing $600 million in quarterly revenue for the first time in our history. As I noted last quarter, we entered the year with a constructive macro backdrop featuring strong private sector intermediation, robust global issuance and elevated levels of market debate alongside early signs of diversification away from U.S. assets. That backdrop evolved quickly. What began as a market conversation centered on the pace of rate cuts in 2026 shifted meaningfully as geopolitical tensions in the Middle East drove an increase in oil prices and renewed concerns around inflation across the global economy.

Our clients actively repositioned risk and navigated this dynamic environment, driving record quarterly average daily volumes on the platform, including 17 of our 22 products that we report in our monthly activity report. While periods of elevated volatility tend to naturally drive wider bid-ask spreads, markets remained orderly throughout the quarter. Our clients engage with the platform at record levels and increasingly capitalized on our automation solution, AIX. Equally important, our dealer partners flourished as our continued investment in consistent 2-way electronic liquidity benefited clients during heightened market stress.

As we move into the aftermath of the volatility spike, history has shown that activity can moderate as clients digest a forward outlook. More importantly, this macro shock has left our clients in a healthy position and we expect them to resume trading actively across our global franchise. Diving into the first quarter. Strong client activity and a risk on environment drove 21.2% year-over-year revenue growth on a reported basis. Our international business continued to set new records with 29% revenue growth as our strategic initiatives across Europe, APAC and EM continued to pay off.

We continue to balance investing for growth and profitability as adjusted EBITDA margins expanded by 40 basis points relative to the first quarter of 2025. -- our international business really continued to fire on all cylinders for us this quarter, contributing to nearly 60% of our overall revenue growth. And importantly, that strength was broad-based as we saw double-digit growth across all 4 asset classes with our international clients. Even though international clients are naturally focused on non-U.S. products, they're increasingly trading outside their home markets. That really speaks to the strength of our platform.

To put some numbers around that, our international clients drove 60% of our dollar swaps growth, and we also saw double-digit contributions from them across U.S. treasuries, cash credit, CDS and ETFs. On the product side, internationally, we had double-digit growth across European, Assi and Japanese government bonds. European swaps was a standout, but we also saw a very strong performance across APAC and EM swaps. And it wasn't just rates as our European credit and CDS produced strong revenue growth, not to be overshadowed we also saw over 20% growth in both our European ETF and repo businesses.

And then on the flip side, it's not just international clients driving this activity. Our U.S. clients are increasingly active in international products contributing over 20% of our international product revenue growth. So when you step back, what you're really seeing is the flywheel of the platform at work, where our global clients are trading across regions and asset classes and we believe this advantage will only grow as we expand our presence across regions.

Turning to Slide 5. Our rates business produced a record revenue quarter, driven by continued organic growth across swaps, global government bonds and mortgages. Record credit revenues were led by strength across global corporate bonds and credit derivatives. Money markets revenue growth was led by record quarterly revenues across global repos and ICD. Equities also produced record revenues, led by growth in global ETFs and equity derivatives.

Other revenues grew over 56% year-over-year, driven by our digital assets initiatives. Finally, market data revenues were down approximately 5% year-over-year, driven by a timing shift in how certain historical data sets are delivered under our amended LSAG agreement. Recall we recorded $8 million in January of 2025 tied to the delivery of data sets to LSAG. The revenue recognition of these data sets in 2026 shifted to $2 million being recognized in the first month of every quarter.

Adjusting for the timing difference, market data revenues grew 13% year-over-year, driven by growth in our recently renewed LSAG market data contract and proprietary data products. Turning to Slide 6. I will provide a brief update on 2 of our focus areas: U.S. treasuries and ETFs, and then I will dig deeper into U.S. credit and global interest rate swaps. Starting with U.S. Treasuries. After 8 months of below average intraday volatility, we saw a significant pickup in March intra-day volatility while March volatility rose over 50% from the December lows, it was still nearly 40% below what we saw in April of 2025.

Our first quarter market share of 22% drove record revenues up nearly 10% year-over-year as double-digit revenue growth in our institutional channel was partially offset by weaker retail trends. While market share was down year-over-year mainly due to lower wholesale market share, we remain optimistic on our reacceleration in our U.S. Treasury business as we penetrate additional parts of the voice market, coupled with continued strong government debt issuance. Our competitive position remains strong. On a relative basis, we exceeded 50% share for the eighth consecutive quarter in electronic institutional U.S. treasuries versus our main electronic competitor.

Wholesale remains a strategic priority with continued focus on expanding our liquidity network, deepening client relationships and driving growth through differentiated protocols and products across our integrated platform. Turning to equities. This year marks the 10-year anniversary of our institutional U.S. ETF platform, an important milestone that reflects both the evolution of the ETF ecosystem and Tradeweb's role at its center. Since launch, our platform has scaled significantly surpassing $4 trillion in notional traded including more than $1 trillion in the past 12 months alone.

What began with just a handful of participants a decade ago, has grown into a broad and diverse global network of close to 200 institutional clients and over 20 dealers. Our ETF business posted revenue growth in excess of 35% year-over-year. as we continue to deepen integration with our clients, coupled with a pickup in market volatility. Our AIX automation solution continues to be a key differentiator with our ETF clients with average daily trade increasing over 70% year-over-year with double-digit growth across European and U.S. ETFs.

Our efforts to broaden our equity presence beyond our flagship ETF franchise continue to pay off with record institutional equity derivative revenues up nearly 20% year-over-year. Looking ahead, the pipeline remains strong as the benefits of our electronic solutions continue to resonate with our clients. We believe we are well positioned to capitalize on the long-term secular ETF growth story, not just in equities, but across our fixed income business. Shifting to Global Credit on Slide 7, and double-digit revenue growth for Global Credit was driven by strong double-digit revenue growth in European credit, EM credit and credit derivatives, which more than offset weakness in municipal bonds.

U.S. credit produced low single-digit revenue growth, led by strong double-digit revenue growth in our institutional business, but partially offset by continued weakness in our retail corporate credit channel, where revenues were down over 20% year-over-year, primarily reflecting the better relative yields our clients were getting outside of U.S. credit. U.S. credit remains a key growth priority and we are focused on expanding our penetration within RFG markets to complement our leadership in portfolio and session-based trading. Despite more than a decade of innovation, RFQ continues to be the primary execution protocol for institutional clients in U.S. credit, driven by its transparency and competitive pricing dynamics.

However, clients are often reluctant to expose larger trades broadly given the trade-off between minimizing information leakage and achieving optimal pricing. In response, we are focused on enhancing workflows that better align with client needs. To that end, we have continued to invest in our enhanced dealer selection tool, Snaps, which enables our clients to dynamically target dealers most likely to engage and win a given inquiry. Based on both historical and real-time trading data. This innovation builds on our broader strategy of expanding the range of pre-trade execution and post-trade solutions we offer.

We remain focused on the block market with overall U.S. credit block share up 20 basis points year-over-year in the first quarter, with block average daily volume growth of over 30% year-over-year across IG and high yield. Our volume growth was driven by continued adoption of our portfolio trading, RFQ and sessions protocols. Institutional RFQ average daily volume grew over 30% year-over-year with double-digit growth in both IG and high yield. Our efforts to expand into RFQ are seeing continued signs of success with our RFQ share of overall TRACE up over 50 basis points year-over-year.

Portfolio trading produced record average daily volume increasing over 30% year-over-year, with double-digit growth across both U.S. and international PT. All trade had a strong quarter with over $230 billion in volume with average daily volume up over 5% year-over-year. Our all-to-all average daily volume grew over 65% year-over-year, and our dealer RFQ average daily volume grew over 40% year-over-year. We saw record responder rates in high yield as the team remains focused on expanding our network and increasing the number of responders on the all trade platform. Electronification remains a key focus, especially in U.S. credit, where underlying trends are strong.

However, investment-grade volumes have been increasingly impacted by affiliate trades, which are internal transfers within a dealer that occur after a transaction in the institutional market. These are double-counted noneconomic trades that don't interact with electronic platforms, distorting reported market share and electronification and creating artificial pressure on both. If you adjust for that activity, the underlying picture looks better. Based on our estimates, first quarter market share in IG would have increased 5 basis points versus our reported decline of 33 basis points and electronification also would have moved higher.

The core trend hasn't changed and electronification in U.S. credit is continuing to build, and we feel very good about our positioning as that plays out. Looking ahead, Global Credit remains a key area of focus with a long runway for growth. While U.S. credit continues to anchor performance through ongoing innovation, differentiated liquidity and investment in our platform, we are also scaling European credit by expanding RFQ adoption and liquidity and advancing munis through increased electronification, transparency and connectivity in a fragmented market.

Finally, in EM credit, where we are still early in our expansion, we are building momentum by leveraging our established presence in developed markets alongside a holistic EM product offering across rates and credit. Our EM credit revenues grew over 40% year-over-year in the first quarter, signaling strong momentum. Moving to Slide 8. Over the past 2 decades, electronic interest rate swaps trading has evolved from an emerging concept into an ecosystem defined by transparency, efficiency and ongoing innovation. That continued evolution was evident this quarter including in moments of heightened volatility, where clients lean further into electronic workflows. Global swaps delivered record quarterly revenues up over 45% year-over-year driven by strong client engagement across our global suite of currencies. Our quarterly core risk market share, which drives revenues and excludes compression trading, reached a record, rising 190 basis points year-over-year.

Total market share increased from 21% in the first quarter, '25 to 24.1% in the first quarter '26 reflecting a combination of strong risk and compression volume growth. During the quarter, we achieved record share across sterling and other G11 currencies and our second highest share across EM denominated currencies. First quarter performance was driven by record revenues across U.S., Europe, APAC and emerging markets. This quarter underscored the value of our breadth across the swaps market, particularly as clients' interest can ebb and flow across products over time. Specifically, as inflation concerns, reemerged and rate expectations shifted this quarter, activity picked up in our inflation swaps business, driving record volumes. It is a product area we entered in 2017 where adoption was initially gradual, but where the opportunity in the market expanded materially after 2020 and and we currently hold over 95% electronic market share.

That trajectory makes periods like this, especially meaningful as they reinforce the value of our continuous investments towards building a more holistic swaps offering across products and geographies over time. Beyond inflation swaps, the nature of trading we saw in March evidenced a broader pattern in how electronic trading continues to evolve. Even as market conditions became more challenging, automation remained robust, and we saw clients not only lean into inherently electronic protocols, but use them in a more sophisticated way through sending their trades out to multiple dealers amidst an environment where we have historically seen that pull back.

It's a testament to the sophistication clients have built into their workflows and and to the growing value of electronic trading across market conditions. Overall, our RFM protocol saw average daily volume growth of over 150% year-over-year in the first quarter with growth accelerating in March. Additionally, we continue to make progress across emerging market swaps. Our first quarter EM swaps revenues delivered another strong growth period, delivering another record and we believe there remains significant runway given the still relatively low levels of electronification.

Looking ahead, we continue to see significant long-term growth potential in swaps. On a DV01 basis, electronification has grown at an average annual rate of 160 basis points since the first quarter 2020 as dealers and clients move a greater share of their workflows electronically. That progress is reflected in the continued strong revenue performance of our swaps business, and we see substantial opportunity to further digitize workflows alongside our clients.

In collaboration with them, we expect to drive continued workflow innovation across both cleared and bilateral swaps markets. And with that, let me turn it over to Sarah to discuss our financials in more detail.

Thanks, Billy, and good morning. As I go through the numbers, all comparisons will be to the prior year period, unless otherwise noted. Slide 9 provides a summary of our quarterly earnings performance. As Billy recapped earlier, this quarter, we saw record revenues of $618 million that were up 21.2% year-over-year on a reported basis and 17.5% on a constant currency basis given the weakening dollar. We derived approximately 44% of our first quarter revenues from international clients and recall that approximately 30% of our revenue base is denominated in currencies other than dollars, predominantly in euros. .

Total trading revenues increased 23%, comprised of 25% variable trading revenue growth and 14% growth across fixed trading revenue. Rates fixed revenue growth was primarily driven by an increase in minimum fee floors for certain dealers and by the addition of dealers to our mortgage and U.S. government bond platforms. Credit fixed revenue growth was primarily driven by the previously disclosed introduction of minimum fee floors and the migration of certain dealers to subscription fees. Other revenues of $10 million for the first quarter increased by 56%, primarily driven by growth in our digital initiatives related to our commercial relationship with the Canton network.

Overall, the other revenue line will remain variable quarter-to-quarter, reflecting fluctuations in a number of variables, including the number of Canton coins earned Canton Coin Value, the number of super validators in the network and periodic tech enhancements for our retail clients. We expect total other revenues in 2026 to be roughly in line with 2025. First quarter adjusted EBITDA margin of 55% increased by 101 basis points on a reported basis when compared to our 2025 full year margins. Our net interest income of approximately $17 million increased due to higher cash balances, which offset lower interest yields.

Lastly, this quarter's GAAP results were impacted by both realized and unrealized gains and losses across our strategic investments. Specifically, we recorded $1.2 million in net loss this quarter, including $2.9 million of unrealized losses reflecting the mark-to-market of our Canton coin Holdings. As a reminder, these losses are only included in GAAP EPS and are excluded from our non-GAAP adjusted diluted EPS.

Moving on to fees per million on Slide 10. We provide a highlight of the key trends for the quarter. You can see Slide 17 of the earnings presentation for the full detail regarding our fee per million performance this quarter. That said, I will spend more time talking about cash credit fee per million given the movements are slightly more nuanced. Cash credit fee per million decreased 15% this quarter, based largely on 2 drivers: the prior introduction of variable and fixed fee mix changes and business mix changes.

Specifically, the introduction of minimum fee floors and migration of certain dealers from fully variable to more fixed plans in 2025 and a mix shift away from municipal bonds and retail this quarter. which carry a relatively higher fee per million as well as a mix shift towards non-comp PT, which carries a relatively lower fee per million. Excluding the impact of our previously disclosed fee changes and this quarter's impact of product protocol mix shifts, fee per million would be down approximately 1%. Slide 11 details our adjusted expenses. At a high level, the scalability and variable nature of our expense base allows us to continue to invest for growth and grow margins. We have maintained a consistent philosophy here.

Adjusted expenses for the first quarter increased 20.2% on a reported basis and 15.3% on a constant currency basis. During the first quarter, we continued investments in tech and communications digital assets, consulting and client relationship development. Adjusted compensation costs grew 12%, with nearly 30% of the increase from higher discretionary and performance-related compensation, more than 25% due to higher headcount, which was up 11.4% year-over-year and 25% due to higher payroll taxes. Technology and communication costs increased 37.7%, primarily due to our continued investments in data strategy and infrastructure and increased software costs.

Approximately $5 million of the increase was driven by higher reference data costs and investments in our data and infrastructure strategy, both of which began in the second half of 2025. Adjusted professional fees grew 18.8% due to an increase in tech consultants as we continue to augment our offshore technology operations. Occupancy expenses increased 61.5% primarily from increased rent due to the move to our new New York City headquarters, which came into effect in the third quarter of 2025. Adjusted general and administrative costs increased 85.2%, primarily due to $8.1 million of unfavorable movements in FX and a pickup in travel and entertainment.

Unfavorable movements in FX resulted in a $5.1 million loss in the first quarter of '26 versus approximately a $2.9 million gain in the first quarter of '25. Excluding FX, adjusted general and administrative costs grew 11.4%. Slide 12 details capital management and our guidance. On our cash position and capital return policy, we ended the first quarter in a strong position with approximately $1.9 billion in cash and cash equivalents and free cash flow exceeding $1 billion for the trailing 12 months, representing strong year-over-year growth of approximately 31%. We also held $1.6 billion of Canton coins with a fair value of approximately $243 million.

With this quarter's earnings, the Board declared a quarterly dividend of $0.14 per Class A and Class B shares, up 17% year-over-year. During the quarter, we repurchased approximately 483,000 shares for $51 million. There is $523 million of aggregate share repurchase authorization remaining. Turning to guidance for 2026. In light of continued strong business momentum, we now expect adjusted expenses to trend towards the top half of the initial guidance range of $1.1 billion to $1.16 billion. We believe we can drive adjusted EBITDA and operating margin expansion compared to 2025 at either end of this range, although we expect the incremental margin expansion to be more muted as we continue to focus on balancing margin expansion with investing for the future.

Specifically, we continue to invest in credit rates, international markets, ICD and digital assets as key focus areas with a long runway for growth. We also continue to invest in technology that allows us to sustain and build on our leading platform. Some of these investments will take time to scale, but we continue to price innovation and create durable long-term revenue growth opportunities. Now I'll turn it back to Billy for concluding remarks.

Thanks, Sarah. Before I get into the broader outlook, I want to spend a minute on some of our frontier markets. We've made solid progress there in a relatively short period of time through targeted partnerships and investments. From our work with the Canton network, to our new partnerships with Kashi in prediction markets to crossover markets in crypto execution. These partnerships build directly on what we've already established, a broad network execution infrastructure and a central role in trading activity.

With tokenization, we're focused on the evolution of settlement, particularly around capital efficiency and collateral mobility. We've already executed trades in this space alongside a variety of market participants utilizing Canton's distributed ledger infrastructure. We are working alongside both existing and new clients who are driving demand for instant settlement. In institutional crypto, the opportunity is to bring more standardized electronic execution to a market where demand is growing, but broadly adopted infrastructure remains nascent. Alongside our investment in partnership with crossover markets, we are building a more comprehensive execution offering, including over time, leveraging rate Fin's technology to incorporate spreading functionality, in prediction markets through our partnership with Kashi, we're working to integrate event-driven data into our rates and credit platforms while working with market participants to support the longer-term development of an institutional-grade execution environment.

Across all 3, the focus is on extending our network and execution capabilities while closely partnering with our clients and the broader ecosystem as these markets evolve. The environment to start the year has been defined by a lot of debate. And if anything, that uncertainty has only increased as we move forward. We did see clients take a bit of a breather in April as they stepped back and recalibrated their forward strategies. But importantly, what came through clearly was the durability of our business. Intraday volatility in April to date was down more than 50% year-over-year. So this was not an easy backdrop.

Even after a record first quarter, April 25, still ranks as the third best revenue month in our history after clients rapidly reposition their portfolios post the announcement of tariffs. Looking ahead to April '26, despite a tougher comparison and a different volatility environment, we are trending toward another top 5 revenue month based on internal estimates. I think that really underscores what we've been talking about for some time now. The breadth of the model and the strength of the recurring activity we're able to build irrespective of the volatility environment. As we focus on delivering more durable workflow-driven solutions for our clients, we're seeing that translate into sustained engagement.

In fact, April average daily volume is currently running ahead of April 2025, which tells you that while the mix of activity may shift, the level of client connectivity on our platform remains very healthy. With 2 important month-end trading days left in April, which tend to be some of our strongest revenue days, overall an average daily revenues are trending down by a low single-digit percentage relative to April 2025. The diversity of our growth remains a theme as we are seeing preliminary positive average daily volume growth across global swaps, mortgages, European government bonds, European credit, EM credit, CDS, equity derivatives, repos and ICD.

Our IG share is tracking in line with March levels, while high-yield share is tracking above. I would like to conclude my remarks by thanking our clients for their business and partnership in the quarter. I want to thank my colleagues for their efforts that contributed to the record quarterly revenues and volumes at Tradeweb. With that, I will turn it back to Ashley for your questions.

Thanks, Billy. [Operator Instructions] Feel free to hop back in the queue and ask additional questions at the end. Q&A will end at 10:30 a.m. Eastern Time. Operator, you can now take our first question. .

[Operator Instructions] Our first question comes from the line of Craig Seventh of Bank of America.. .

Are. Hope everyone is doing well. Sorry about that. I just switch to a speaker because the headset was a little messy. But Bill, I hope you guys are doing well. So our question is on swaps and congrats on that 45% year-on-year growth. But we wanted your perspective on the good versus bad volatility debate in the swaps market given recent strength and especially curious on what you saw in Europe.

Craig, how are you -- you loud and clear? -- glad you're doing well. It's a good question. And we -- as I kind of think about that for a quick second and like maybe before I kind of parse like the kind of the port is too hot, the port is too cold around volatility for Sean. Just like a moment, maybe just like on the environment in general because I remember you kind of heard me loud and clear on the last earnings call, say, I was really very app about the macro in the setup. .

And the truth is, and the reality is, I think, a couple of months later, the world changes really quick, like still like really, really app. We're still really Amara Tradeweb. And I think from my perspective, we are in how we would describe like a really kind of sweet spot for our business. And when I say that to make an obvious point, that doesn't mean that we don't have, as you know, very well, like complex and difficult things ultimately to get right. But when you just step back for a quick second and you think about the combination of fiscal stimulus, monetary stimulus, debate on Fed timing, we're in this like technology, obviously, investment super cycle, this like big deregulatory unwind, the legacy banks, the partner banks of Tradeweb had a great quarter in the Global Markets business.

The numbers from Jane Street were like off the charts, obviously, this week. We're like a pretty prime environment. So I want to kind of start with that. And then when we think about -- to your question, how we parse kind of good volatility and then bad volatility, like think about obviously always like good volatility as like strong '28 markets, active price discovery. From our perspective, something really important, which is like that AIX algorithmic search is like running really well. And we're we always understand there's always this concept of like markets moving into more of a bad ball market. Think about that as obviously like a dislocated market environment, thinner liquidity, less liquid areas of the market generally kind of parts of the off-the-run treasury market sometimes fit that description perfectly.

But to your kind of point, I would say like the volatility across the Sterling and the European markets, I think they were 2x higher than the U.S. rates market in March. And so given that rapid repricing of rate cuts to potential rate hikes, I think the market's moved extremely orderly and consistent with how we think about healthy price discovery process rather than how we think about like stresses in the system.

And from my perspective, I think I would say something important, which I think it speaks to how these markets have evolved. I think that's an important kind of comment, both buy side and dealer communities today are just like significantly better ultimately positioned to navigate these environments electronically, stress or no stress. And that's important. I think we saw that in the data, increased usage of electronic protocols, particularly RFM and income trading. This protocol, Craig, that we've launched in Europe, our request for market got up to like 45% of flow.

In comp trading move north of 80%. That's kind of what you want to see very specifically in periods like this. And so as the shift becomes more automated, from our perspective, protocol-driven trading tends to make ultimately something very, very important, which is liquidity becomes more resilient even as volatility rises. So that's kind of how we think about the context. I think in a very interesting way, the distinction almost between how we think about and talk about good and bad volatility, the port is too hot, the port to cold becomes almost -- I don't want to say irrelevant, but I think in a certain way, it becomes kind of less relevant because the market structure today is much more kind of designed ultimately to perform and generate activity across a wide range of conditions.

And so that, from our perspective, I think, is a really important point. You've heard me because you know me well, you've heard me talk about sort of like this kind of like how we talk about -- sort of like the light switch moment when a client behaviors change, they go from using or engaging the market in 1 way to a better way, like this kind of like a light switch moment. I think increasingly, we're thinking about volatility in a certain way as its own version of a light switch moment where ultimately, technology allows the participants to thrive.

And I think that's a really, really important and kind of interesting concept. And so from my perspective, what we're in the business to do, which is to thrive, as you know very well, we have our 1 version of a really high bar. And so 1 thing I would kind of say as we're thinking about context and where we're going from here, if you take April -- this past April revenues this month of April revenues and you look at it versus May and June of this past year, we're there and you feel like you're in this kind of sweet spot moment. So thanks, as always, for the question. Good to hear your voice, Craig.

Our next question comes from the line of Michael Cyprus of Morgan Stanley. .

Bill. Wanted to ask about AI and just curious to hear your views around how you're thinking about AI's role in increasing automation across workflows particularly in credit and rates? And what are some of the KPIs you think we should be tracking?

Great question. Super timely, Michael. Appreciate it as always. I thought for a second, when I was listening to my recording, I thought it was like an AI version of my voice or something on this different, which is kind of funny. But great question, timely. For 1 quick moment like core principle, like -- and I want to say this is like very loud and clear, like Tradeweb, as you know very well, we're in the business of serving our clients, like Period.

So everything we do around AI always has to be kind of triggered off that. And our goal and Sarah's goal and my goal and the management team's goal at Tradeweb, as you know, is to be the most client-centric firm in the electronic marketplace like Period. And I think in a really interesting and exciting way, AI gives us that opportunity constantly to prove that. not that we're all like historians, but I would say like the history of technology, as you know very well, is that it tends to make smart people smarter, right? Productive people more productive, right?

And without question, big picture, AI is this like massive accelerant of all of that, right, expanding the scope of what people do, expanding people's impact. That's like really, really kind of like important stuff. We have a very strong feeling that data is the moat I think that's an important kind of thing to say our proprietary data, which we draw, as you know very well from like live markets, executable pricing, RFQ behavior, execution outcomes, client decision-making protocols across all of these assets.

I think gives our AI foundation, something that maybe competitors can't quite come as close to. I'd say that like humbly, I think that's an advantage for us. And so on the generative AI side, our goal is pretty simple. Move clients from data retrievable into this thing that's really important, which is like insight generation in markets that obviously like never slowed down, and that's important. We did something, I think, really cool, very proud of. We have our own kind of AI-powered assistant named, we're calling it Terra. I think we have to kind of think about -- keep thinking about the name, it's kind of a cool name, but it's Tradeweb AI research assistant, which is in beta with our clients, some of our smartest, most important clients.

We're on track to launch that in the second quarter, which gives traders like a single natural conversation to surface insights around liquidity conditions, market participation, historical execution behavior and relative pricing dynamics. These are like really, really important things, and you can hear from me the focus that we have as a company. On the predictive side, we're tracking -- tackling and working on I think 1 of the fixed income is probably hardest problems, which is price discovery. We're launching what we call AI Price 2.0 at the end of the second quarter.

As you know very well, corporate bonds can go hours or days without a print and the true economics of a transaction could be obscured by like this complexity piece of it all. I think it's worth as a company as spending a lot of time on that in that setting. And so in its simplest form, and I like to take the kind of like half step back, as you know, really well. It's going to be always about getting really smart people access to this amazing technology inside of the company and really proud of how many smart people work at Tradeweb, like expanding productiveness.

I'll say this just like very clearly and maybe like a little bit personally like as CEO, what's interesting to me is not just doing more with less people, it's not just like saving money. And Sarah and I are always like just like amazingly on the same page around all of this. It's about like reimagining like process, really, right? How do we have the ability to continue to invest more in our future of growth. Because we have a lot of potential out there, and we're really excited about that. And that's a pretty cool thing. So all of this stuff has to be top down all of the time.

I think we're still in a very important way at the beginning. You know this very well, dealing with this at your own firm. I think there's going to be some hard choices kind of along the way around all of this. But data advantage, I think, reinforces network effects and I think that opens up new revenue opportunities smarter, faster ways for our clients to trade and execute in the marketplace, and that's the focus and I think the intensity that we're bringing to the space around all of that. So thanks very much for the question.

Our next question comes from the line of Simon Clinch of Rothschild & Co Redburn. .

Actually, this 1 is probably more for Sara. So following on nicely from the last question about AI investments generally for growth. Sarah, could you expand on your philosophy for expense growth in terms of the flexibility and willingness you have to adjust investment up or down in environments of volume upside or in fact, downside? How we should be thinking about that kind of flex, please? That would be great. .

Sure. Simon, great question. Definitely sort of a good follow-on from the conversation Billy just had. Regardless of whether we're in a high or low volume environment, and I know we've said this before, we believe and I think we've evidenced we have significant operating leverage and expense flexibility in our model. So big picture, roughly 55% of our expenses are fixed and 45% are variable or discretionary.

And so Specifically, in your question when you're asking about volume-driven expenses within that variable bucket, most of those expenses are more directly tied to revenue or EBITDA growth versus volume. So think of things like performance-driven comp, commissions. But there are some smaller components that correlate more directly to pure volumes such as exchange and clearing fees, and those are pretty small in terms of the total expense base we have. call it, single -- low single digits, like something like 3% of our total expense base, which leaves us a lot of flexibility in terms of how we manage expenses and deliver operating leverage.

More broadly, I would say, when you think about higher volume as a proxy for higher revenue environment, you should think about our expense growth is really following our track record of as you were kind of getting at accelerating discretionary spend while still delivering margin expansion. And I think we have this flexibility to accelerate and decelerate. So -- if you looked at last year, top line grew 19%, expenses grew 17%, and I talked before how that probably was in our budget at the beginning of the year, but we accelerated discretionary spend and still delivered 64 basis points of margin improvement.

If you contrast that with an environment like 2023, where we had multiple quarters of single-digit top line growth, we still delivered margin expansion of just under 50 basis points while investing in our platform. And that shows 2 things. It shows our ability but also our willingness to your point, to accelerate and decelerate. This quarter is another example. We delivered almost 100 basis points of margin improvement on a constant currency basis including facing significant step-ups or swings from FX and step-ups from the office and other data infrastructure spend.

So I think we've seen in every environment, we have the ability to manage our expense base. And I'd say, at the highest level, the great thing about our business is that as revenue and our business keeps scaling, we continue to see natural operating leverage. And that allows us to calibrate expenses while still delivering margin but still being able to invest for discretionary and opportunistic things like Billy was just talking about, whether it be AI, or opportunities in EM. And that, for us, is like our North Star and being able to deliver durable long-term revenue growth, that ability to invest through the cycle.

Our next call comes from the line of Jeff Schmitt of William Blair.

So you've talked about EM and EM swaps in particular, being 1 of your key revenue growth opportunities. And I know it's still a small part of the mix, but could you talk about what you're doing on that front and what type of growth you're seeing? .

Yes. It's a good question. It is a small part of our growth, but it's a growing and really important kind of story for us. I think it was like 6% of our revenues in the first quarter of 26%, and that's basically up from like almost like a little bit over 1% in 2022. And we're still scratching the surface of it, right? So like find the wallet, that's really kind of an important thing, right? I think the overall EM revenue wallet exceeds like a little bit over $1.5 billion annually. So it's a big market, significant kind of opportunity for us there.

And it's not to say that you have to pick your day job, but I think it's a little bit of a continuation that I was saying before, just about like how do you wind up servicing your clients around the focus of building solutions, the sufficient search for liquidity. And at some level, that holds true for whatever market we're talking about. But we think we have a really strong leadership position across obviously, our legacy U.S. and European businesses. And we're really proud of what we've been able to accomplish in a short period of time as a public company in EM.

So start with this. It's a -- from our perspective, and we talk about like plotting for growth. It's a multiyear growth opportunity rather than how we think about, and Sarah described this perfectly like a single investment cycle. I do think we're building on this like pretty strong foundation in place vis-a-vis the developed marketplaces. If we were thinking about the EM swaps market for 1 second, I think similar structural growth around that, EM countries continue to finance their growth through this like very big healthy global debt issuance.

We're starting to see something really important, which is the velocity of these markets increase. I would point out something, I think, just like very important, which is the cleared EM swaps market has grown at an over 20% CAGR over the last 5 years. It's still only like 20% electronified. And the market is only a fraction of the size of like the dollar and euro and Starling markets. So I probably just mangled that, which is okay. But you guys hear, as I described that, the beginning of a market really picking up velocity and beginning to go electronic, which is 1 of the reasons why we're so focused in this area.

I think we're starting to see very early success from our perspective around EM hard and local currency credit. That's still, I think, from my perspective, a bigger lift. But excited about kind of how we're thinking our participation in the Middle East, index inclusion in markets like Saudi Arabia are important, obviously continuing evolving clearing frameworks happening there. And then something very important, which is increasing participation from both kind of global and and regional investors there. So we're busy. Recent launches, we've done like Mexican repos, asset swaps I think those are good examples of how something that we really focus on, which is how do you deploy capital ultimately incrementally do something very, very important, which is established liquidity and then ultimately do this thing, which is the magic around it, which is scale, participation across dealers and clients "buy in" really important stuff.

So a lot more work to do, but we feel pretty good about the trajectory. We feel really, really good about the forward opportunity, the wallet the general trend of direction there. And I think focused on something that's important, which is the long-term health of our EM franchise. So that's what you're going to get from us. And thanks for the question.

Our next question comes from the line of Patrick Moly of Piper Sandler. .

Yes. So the DTCC's tokenized treasury pilot is going to go live on Canton in the next couple of months to network that you've obviously been running infrastructure on for some time. So how are you thinking about the potential impact of real-time intraday collateral mobility on fixed income volumes and rates in particular? And then if you could maybe just talk about the broader opportunity and risks as it relates to tokenization and anything you could also share maybe on client conversations and client demand for this tokenized training?

Yes. How are you, Patrick, could you your voice. Sometimes I feel like we're like the best spokesperson out there in the world for Canton, and I said it in a good way, because we're behind them, and we think that they're on to something really important. I think you nailed it in your question around the DTC pilot and how important and meaningful that is. But maybe like Not a half step back a quarter step back. I think for a second, let's just understand, ultimately, what tokenization is is an upgrade to market infrastructure. It does a few things that are very important. It makes settlement faster, more transparent and ultimately has the potential to enable kind of real-time 24/7 collateral movement.

Those are like really important kind of concepts. I say this again, I think the pilot is like a meaningful step because it's bringing U.S. treasuries on chain within a trusted market structure. I think the concept of market -- a trusted market structure is important. And then there's no question that once you do that, you're starting to do something important, which is like broader industry momentum. So these things are kind of coming together. We've been active in the space, to your point, through our tokenized repo activity on our friends at Canton.

And I think that participant set is continuing to grow and becoming more diverse. I would say not that Tradeweb needs to have a big sales pitch around this, but we do bring our own role around this, I think, in terms of helping the industry feel comfort around change because I think we bring a lot of credibility into this. And so we're excited about it and excited to do it. It doesn't disintermediate us. we see risks everywhere, as you would expect us to. We're in the business of always seeing risks, but I don't see the disintermediation around this for us here. I think the execution layer always is going to remain ultimately the most valuable part of the market.

That's where as you know, very well, liquidity is formed, prices discovered. And that's where we operate and live and thrive. So as assets become tokenized think about it this way, as assets become tokenized, they're going to continue to trade through these like electronic workflows, and that execution is our bread and butter. So excited about it. I've made the point before, and I'm trying to get that light bulb to ring off with our friends at Canton. I think the mortgage market given how important that market is, has a settlement process that has the ability to really change, and that's going to be a marketplace that we're going to stay focused on.

We're always looking to have markets have more participants in them. And when you think about a more streamlined and efficient settlement process, that's 1 of those things that allows more participants to flourish in this kind of changing world and changing market environment. So thanks a lot for the question, Patrick.

Our next question comes from the line of Benjamin Budish of Barclays.

I wanted to ask about ICD. I think it's been about 2 years or almost 2 years since you completed that acquisition, Wondering if you could just give us an update where are you in terms of cross-selling, what do balances look like? And what's on the product road map after the addition of T-bills? Any update there would be helpful.

Sure. We're really pleased with how ICD has performed. We think it's performed well, and it's definitely complemented our overall business. It's been a good fit, I'd say, culturally, strategically and financially. So -- specifically this quarter, ICD delivered, and I think we said this in the fifth record revenues and balances year-over-year growth around 8%. Even in April, we're seeing revenue and average daily balance growth rates that are feeding higher than that figure in the first quarter. So -- it's certainly volatile times in terms of like testing large issuances by corporates and then obviously, quite a bit of spending, but that generally has benefited the business because we're seeing those large corporate issuances translate to those balances on ICD.

Away from that activity generally like corporate cash, corporates remain healthy momentum and new client wins, we're seeing that high client retention, which was really important to us when we did the acquisition remain. And then in terms of like our original thesis, certainly around cross-selling, we had 2 focus areas. One was cross-selling our products to ICD clients on their portal and then taking the ICD offering to our client base, particularly internationally. -- that international opportunity is proving compelling -- in Asia, in particular, we think is a white space long term for us.

Corporates are sitting on a lot of cash there, and we think we have a great brand. And so as we think about where we've put our resources, we've completed our Singapore regulatory approvals. We've moved more salespeople into that market. And as we continue to expand our presence, which Billy has been talking about in Asia and EM, more broadly, we think ICD is a complementary another high-quality product to sell into those relationships. So that's 1 of the pieces we're really excited about. On T-bills, which has been on our road map, we completed that last year and cross-selling, generally speaking, other Tradeweb products.

We've completed the core functionality to be able to do that, and we're working through some of the adjacent integrations with things like client treasury management platforms to drive easier adoption. It's been slower, but we're making steady progress. And so overall, I'd say just in terms of the cross-selling, we think the international opportunity is probably more in focus for us right now on the road map. But 1 other point, what I was alluding to is 1 of our original thesis points was around creating enhanced durability for Tradeweb and how ICD acts like a -- has a hedge like quality. When you think about our portfolio across different market environments.

So whether that be risk off environment where people are more apt to keep cash, we see benefits on ICD or in the corporate bond examples that I was talking about, where we've seen heavy issuance that historically weighed on something like our U.S. credit business, where we saw more muted near-term trading activity. Now when you put all those things together through ICD, at that same time, you might see more muted trading activity, you're seeing larger cash balances on the platform, and it's nice to see that hedge like impact happen as we think about building a really durable portfolio from which we grow. So overall, I'd say we feel really good about how ICD has performed, and we're looking forward to continuing to drive growth ahead.

Our next call comes from the line of Alexander Blostein of Goldman Sachs.

Dilly, I was hoping to go back to 1 of the comments you made around Calcin sort of some of the innovation you guys are pursuing there. So interesting partnership, you gave us sort of a high-level view of what that could look like. But any more specificity you could provide on the revenue opportunities for your firm over time when it comes to calcium and production markets. as well as how you guys might deal with regulatory uncertainty that keeps kind of popping up related to this market. .

Yes. Good question, Alex. Ms. Jen and Boca. -- it's good to hear your voice. I hear your question. I think I'll answer it like in the blunt way that you know me. I think it's still early. I think that's important for me to say. I think it's -- I think there's momentum, but it's early, and I want to make sure I kind of say that the right way. I have a very strong view that I don't think -- that I think all predictive markets are not created equally. So we are exceptionally interested and oriented towards financial -- financially oriented predictive markets when Taylor Swift does or doesn't get married is less of an interesting data point to us, as you know. .

They're incredible marketers though, by the way, like they're just kind of everywhere in terms of their marketing. But what I would say, just like extremely specifically is interest is there. And when you see it, it's pretty impressive. So we are seeing like just very, very genuinely very broad interest between the combination of hedge funds, the systematic shops, Alex, that you would expect, nonbank liquidity providers. I think we're starting to get actually like very, very real interest from some of the long-only investors. They're kind of asking about visibility into these contracts.

I think some of the timing has been honestly helped by some of the Fed research, but the demand was already building. I have a very, very strong view that you know very well, which is I think the definition of macro markets in general is continuing to evolve. So I think clients are looking at prediction markets, crypto markets, other nontraditional sources to support their core macro strategies in very, very different ways than they were a year ago. And so we're going to be on top of that trend from the beginning. So -- we started simple, and I think we are quite early. We're launching a free viewer in the second quarter and having clients see select economic and financial event contracts in real time, right alongside swaps and treasuries.

And we think that's like the absolute correct for start. It's pretty low friction. And ultimately, it's about discovery and kind of learning. And I think that's important. The feedback has been positive. The next step, I think, is super important, which is like this normalized -- basically a normalized API feed. So clients can pull this data directly into their OMS, EMS and analytics kind of workflows. When we have a bank pricing risk, Alex, on our platform in the forward curve, they're going to be using data that's important around some of these predictive markets to price that risk, I think we have a very strong view that that's how the market is going to evolve.

And so from my perspective, let's stay kind of thoughtful and disciplined on this. I think there's a lot of headlines as you know very well, particularly on the regulatory side, and we're going to have to see how things play out. But I have a core belief that these are the kind of partnerships that lead to strong innovation and we're the kind of company that are going to place the right bets around these evolutions and I'm very, very willing to kind of continue down that path. So thanks a lot, Alex. Good question and good to hear your voice.

Our next question comes from the line of Chris Allen of KBW. .

I think most stuff has been covered. I wanted to ask quickly just on the February announcement of the partnership with Maxx within U.S. resi mortgages. Wondering if you're seeing any early returns so far. And zooming out a bit, how does the go-forward look in mortgage MBS trading look into the back half of this year 2? .

Yes. It's the same theme, and you guys are kind of like hearing this from Sarah and I, like, I think, like loud and clear. We're placing bets on further evolution, and we're doing that. with a clear eye and I think the right amount of discipline and a good vision for how things are going to continue to evolve in the future. And I think that's really important. And so Maxx is a big piece of this. It's early still and feeling really good about a very different kind of partnership now that we're talking with Maxx versus Alex's question in predictive.

We entered into this like commercial collaboration with this, I think, very straightforward objective of helping to expand institutional access across the U.S. residential private credit marketplace. Maxx has this great reputation. They've been a leading digital exchange for whole loans for a long time, and they connect this very broad network of originators within the institutional buyers of the centralized clearing house, which is unique in a highly fragmented market. So they're the kind of company that we like to partner with.

And I think the mortgage market, and you guys have heard me say this, I think the mortgage market stands out there as this extremely important market within the rates complex. You guys heard about, obviously, Jamie Dimon talking about a bond crisis yesterday and talking about the treasury market, the importance of the mortgage market, as everyone on this call knows, is a big deal. And so we're going to continue to invest in that area of the marketplace, more participants, more velocity of trading, more investments around changing the settlement of that asset class.

We have a historic leadership position in the mortgage market that I think is something that the company is quite proud of, and we're going to take that leadership position into further innovation because that's what makes us excited and charged constantly as a company. So a lot of focus on Maxx, but then also, I think a lot of forward bullishness on the continued evolution and the velocity of trading that exists within 1 of our very first markets I kind of -- I made the joke on the last call, it was my favorite child. It still is my 5 child. We're like entering into that child going to a really good college. The market is doing quite well from an activity perspective. So we're excited about all of that. And thanks a lot for your question.

Thank you. This concludes the question-and-answer session. I would now like to turn it back to Billy Holt for closing remarks. .

Thank you all very much for joining us this morning. Appreciate the questions as always. Any follow-ups, as always, please feel free to reach out to Ashley Samir and the amazing team that we have. Thank you all. Have a great day. .

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

All right. Good morning. We will go ahead and get started. For those of you who do not know me, I'm Patrick O'Shaughnessy, the Capital Markets technology analyst here at Raymond James. Thanks, everybody, for joining us this morning on day 2. Up next, we have Tradeweb Markets. And on their behalf, we have CEO, Billy Hult . Format of this is going to be just a Q&A fireside chat. And Billy, welcome.

Thanks very much for having me. As always. Appreciate it.

So obviously, as you could probably guess, the big topic of the past month and at this conference so far has been AI risk. And I almost feel embarrassed to ask you this question, but do you see any theoretical competitive disruption risk to Tradeweb from AI?

Yes. Great question. It's amazing like how fast kind of time goes because we've gone from kind of like Tradeweb, the origins of Tradeweb was really kind of almost like in like the Liar's Poker world. We're a technology company, but I say this all the time, we're a technology company that like lives and breathes like in the financial services. And we're a pretty big part of the -- really of the fabric of the financial markets and the roots are deep around, obviously, government bonds, mortgage-backed securities, interest rate swaps, credit, ETFs, how do you connect the biggest, most important asset managers, hedge funds in the world to their counterparties. That's the business model of Tradeweb.

So we've gone from the Liar's Poker pizza at 9:00 a.m. to how do you get people to log on to a platform and start beginning to trade electronically. And now here we are in March of '26, kind of talking about AI, which is kind of amazing how quickly things change.

If you want to think about really the concept of, if not like AI proof, but the real way to be on the right side of this evolution around AI, I would say proprietary data is probably, first and foremost, the most important thing to think about.

And then secondly, I would say, like leading market share. And I feel like with what Tradeweb does day in and day out, the bread and butter of how we go about continuing to move markets forward into transparency, we're really kind of living and breathing on the right side of this movement around AI.

We have amazing data in part because we live not just on the institutional side of the business where the PIMCOs of the world connect with the Goldmans of the world, but on the wholesale side of the world where banks offset risk with each other and also on the retail side of the world. So we are able to offer really, I think, best-in-class data, and we've been able to build up these kind of leading market shares all these years, which gives us some pretty good room around AI.

And then on the other side of the coin, how are you guys internally deploying AI to generate market share gains to extend your competitive advantages, et cetera?

Yes. So in like the whole kind of like the Liar's -- I'll keep going with the Liar's Poker analogy, like in the whole Liar's Poker analogy thing, it was all like about like telephone to terminal, telephone to terminal, maybe terminal mouse. And without question, this next leg of what's happening around technology and how technology is being applied into these markets is really about now how we think about algorithms, smart searching, finding liquidity in the markets that we are in with the least amount of footprint possible and almost way that we think about smart searches.

And so we've been, I think, in a good way, front-footed around something that we call AiEX trading, which is really a kind of data-oriented algorithm, smart search in the market, where many of our bigger and more sophisticated clients are no longer on the phone. They're no longer on the mouse. They're no longer on the terminal, but they're aggregating liquidity. We're building models with them. And instead of guessing where the liquidity is in the market, they have a lot of data that reinforces where the liquidity is. And my instinct is, as the market continues to evolve, that's a really strong push around that.

And I think if I was going to describe it to you this way, Patrick, I would say, as you know well, the origins around Tradeweb is we grew up as a company really competing against Bloomberg day 1, very formidable companies, everyone in this room knows well, big, big presence around desktops, et cetera.

And we always had -- we always felt like we had to be ultimately living and breathing in the markets better, but ultimately, also, I would say, innovative around change. And I think as we think about and talk about where we're going around these smart searches and AiEX activity, I would say, as great of a company as Bloomberg is, and they're a great company, as everyone knows, they're a little bit more defensive around this next wave of technology. And my instinct is, obviously, that's because the first and foremost, inclination is towards the terminal. And that's given us an edge.

And then on the topic of competition more broadly, you guys often speak about how Tradeweb's strong relationships with dealers is really critical to your success. But as I kind of think more broadly, the history of the exchange and trading venue space is you see new launches, dealer support, new launches, they get warrants, they get ownership rights. So how do you ensure that Tradeweb maintains those strong dealer relationships given those dynamics?

Yes, it's true. It's not to say that like markets have short memories, but they sometimes have short memories. And so you're right. And I think the inclination on us is to always reinforce something that we've done essentially from day 1, which is understand that this is part of the living and the breathing in the marketplace.

Understand that there's a balance. And there are moments in time, and I'll say this the right way, where we've walked out of BlackRock with an idea that BlackRock has had. And we've -- by the time the elevator has reached a lobby, we've realized that like there's a pretty decent chance that even though that's a great idea, most likely, it's not going to wind up working for the Goldmans or the JPMorgan or the Morgan Stanley in the world. So you have to have a very fine-tuned sense around market structure and the nuances of ultimately trading relationships that exist in the universe.

We had some interesting benefit around this because as you guys know, I think, well around the stories of it all, kind of post crisis, our direct competitor in credit really ran, I think, intelligently ran how we think about an all-to-all strategy. They call it Open Trading, but it's a strategy that ultimately connected sort of the buy-side with other buy-side participants in terms of liquidity provision.

And there were a lot of things, particularly around that moment in time that made sense. But the reality is that's a kind of evolutionary protocol. Actually, it's a revolutionary protocol that actually disrupts the normal engagement of trading, and it opened up a door for us as a company to really bring the banks back in and to restore the banks as primary market makers to their clients.

Those kinds of stories, that kind of track record, I think, goes a long way for us to continue to build out marketplaces with the banks. And from our perspective, just the combination of having the banks gone through -- having gone through the sort of the teeth of regulation to have a little bit of like their swag back in the marketplaces that we live in. We view that as a good thing. Plus there's the reality of the nonbank liquidity providers, the Citadels of the world arriving full speed in our marketplace, that keeps everyone on their toes in a really good way, short memories and all.

So you guys had an interesting graphic in your quarterly slides where you said you're up to 10% market share in risk trades in the interest rate swaps market. And I think there's a lot of noise in the data, interest rate swaps, the compression trades, there's risk trades.

But is it right or kind of appropriate to think of your strategy is kind of enter that space with compression trades? Yes, it's lower fee, but you get your foot in the door, you get those relationships and then you move up to the risk trades from there?

Yes, it is. I mean our -- you've talked a lot about credit. We talk a lot about government bonds. Those are the two markets that everyone kind of goes to quickly. Our global swaps business has been just an absolute killer market for us. We've done exceptionally well. That was the ultimate kind of back alley market that's gone to an electronic market, very transparent. Now the volumes are really strong.

We've gone from, as you know very well, my first year as CEO, we were up kind of 12% growth. Swaps was a big engine on that with 29% growth in 2024, a very strong year in '25. I feel like this year's setup is great for our business. It's a crazy world, obviously. We had a very strong January, up over 15% -- excuse me, very strong February, up over 15% year-over-year growth. A lot of that was fueled by continued very, very strong activity in our global swaps business, particularly maybe not surprisingly, coming out of Europe.

The way that we think about compression has always been let's get into the most sophisticated clients' workflows, show that we know what we're doing around solving for problems and then ultimately, the risk of it all follows. So sometimes not with you, sometimes I'll spend time with a smart analyst, not as smart as you, and they'll be like when is that kind of compression thing going to go away because it's harder to understand where the fee per million goes.

And from our perspective, we kind of hope it never goes away because it's a gateway to ultimately getting after the real risk trades of the most sophisticated clients out there in the ecosystem. And that's kind of what we do, hopefully, best-in-class. That's what we try to do.

And then on the topic of cash U.S. treasuries, market structure there is changing, and we're going to have, at some point, centralized clearing of treasuries, even though it's been delayed. How do you see that playing out and impacting Tradeweb?

Yes, it is changing. And you're right. And so not that long ago, I made the kind of Liar's Poker story in the beginning. If you had told government bond dealers not that long ago, that nonbank liquidity providers would be the engine of market making in the wholesale side of the market, the most sophisticated machine learning technology-oriented side of the market, I think a lot of people would have been surprised, but it shows you how quickly evolution occurs, which is one of the reasons why from our perspective, from a strategic perspective, we have always wanted to make sure that we're on kind of both sides of market structure, like the wholesale side plus the client side.

And I would say, as we think about clearing, one of the things that I think we would be pretty clear about is that, no pun intended, would be that there will be ultimately, with central clearing, the potential, which I think is the strong word, the potential for more clients to trade picks and spots anonymously on order books, which we think is a good thing for the business. It's one of the reasons why you want to have that kind of full cycle of market structure at your disposal.

And then on the U.S. credit side of things, your market share has been largely range bound since the second quarter of 2024, as has your larger competitors you mentioned earlier. But there's some good stuff happening under the hood as well, particularly with RFQ. Why are you confident that you still have strong momentum in the business?

And I've learned like all these years, and you know this well, Patrick, from the first time we met, like be directionally on the right side of where market share is going, do the right thing for your clients. There's always going to be kind of like fits and starts around market share. It doesn't just come in waves. It was not that long ago that Tradeweb was a rates company and had essentially no presence in credit.

Now we're pound for pound kind of in there as the 1 or the 1A in credit. I think the recipe is going to be the company that can navigate for sure, keeping the banks on side. I think the banks are going to continue to play meaningful roles in credit market making, period. We say that very loudly.

At the same time, embrace protocols to have the Jane Street and the Citadels in the world playing on your side. aggressively. I think multi-asset class matters in credit. We've been able to make a lot of inroads by being the leading treasury platform. I think that helps us in credit because obviously, credit trades on spread. And then I would say, in a lot of ways, the most important thing, and this will probably combine some things I just said is companies like Tradeweb, companies like MarketAxess, companies like Bloomberg, they make their living essentially with the buy-side being proactive in the market and the banks reacting to flow. And that makes a lot of sense to me, but I would say it sort of encapsulates part of the flows that exist on a trading day.

And the other type of flow that exists, which I think this room knows really well, are kind of banks in moments being proactive in the market, either around inventory or around their trading access. Those tend to be the more profitable pieces of the business. They're sensitive pieces of the business. I think it goes back to making sure that you've navigated those relationships the right way and you build technology the right way.

But the next leg of growth, I think, most likely will incorporate banks being the proactive participants in the market in terms of either inventory or trading access. Plus, and a big plus on this one, the ability to ultimately navigate for block trades and complexity.

And I don't think you can navigate for block trades, i.e., risk trades without keeping the banks on side. I don't think that for better or for worse, Wellington connecting out there in the universe with Fidelity will occur around block.

Makes sense. So we've talked about interest rate swaps and U.S. treasuries and U.S. credit. What are some of the other products at Tradeweb that you think are underappreciated long-term growth drivers for the company?

First one that comes to mind, and it's -- again, it's a little bit -- it's an interesting story, like we -- the TBA mortgage market like way back when was the sort of like the second market that the company was in, but it was the first market that took off. And when I say it took off, it immediately had kind of the biggest players playing on -- playing electronically, which can be unusual. A lot of times, those markets kind of evolve electronically. It doesn't take place on the fringes, but it takes place with the types of companies that have the most to gain from transparency, which isn't always like the big guys.

And the mortgage market for a bunch of different reasons, took on a very different kind of character around it all. That market goes from being sort of one of the leading marketplaces -- the current coupon mortgage market can be one of the two or three most important financial instruments in the world to sleepy, depending on where we are in the rates kind of cycle of it all.

We have very strong market share at Tradeweb in mortgages, a combination of the institutional piece and the wholesale piece. I think we have a pretty strong instinct that quite a strong February in mortgages. I think we have a pretty strong instinct that if we go lower in rates from here, the potential of that market really picking up from a volume standpoint is there. And I obviously use the word potential, but I think it's there.

And then I think what we've been very, very focused as a company, we're U.S.-based. We have a big New York presence, for better or worse, a born and raised Manhattan, we have a big global business. And we've done -- I mentioned European swaps. We've done exceptionally well in European swaps. So I think like what we've been able to do as a public company, really building out our presence in EM is a little bit of an underappreciated story.

We started off in the kind of interest rate side of the EM marketplaces. We have our sights set on credit, which we think is a big market where there is room for competition there. We are a New York-based company that does not have any version of a satellite office in London. It's a leadership area of the company. I think our best and brightest kind of in and out of that office all of the time. And I think the lens that we approach to global businesses I think, is one of the more important -- not to say underappreciated, but I would say, I think one of the more important things that we've done over the years.

And remind me, I think it's 40% of your revenue comes from outside of the U.S. right now.

40% and then a combination of Sameer, Sara and Ashley, all much, much smarter than I do have the exact like percentage of growth. It's a very, very big percentage of growth that comes out of our world internationally. It's the kind of world there where the practitioners in that space can understand how clients engage in liquidity his or her direction on the trade, not giving up any information.

And if the bid-ask on the market is within a certain parameter, the client will engage on one side or the other. And then all of a sudden, big versions of risk get traded. And that -- I tell that story with a lot of pride for the international business because they figured out how to do that. And that was phone-based business or kind of Bloomberg message-based business before someone figured out how to do that. And that's a good sign around innovation. It's a practical sign around innovation, I think.

Beyond AI, another big topic of late has been tokenization. What do you think is the role for tokenization to play within Tradeweb?

I think there are markets that we are in that will have, from our perspective, significant benefits on the kind of collateral management settlement side of the world.

And so I had mentioned the TBA mortgage market kind of going from at one point in time, one of the biggest markets in the world or one of the most active markets in the world to sleepy.

One of the things about that market that's unusual is much, much fewer participants in that market. You don't really have the nonbank liquidity providers living in the space like they live in government bonds or swaps or credit. You don't really have systematic trading in that world like you have in the mirror pools of liquidity in the macro world.

One of the reasons why that is, is because for obvious reasons around origination, the settlement cycle is funky. You have 30-day settlement cycles. You have mortgage bankers selling out 90 days from now. And I think that market, in particular, will benefit massively from a shift around collateral management and efficiency around how pools are ultimately transferred back and forth, really interesting possibilities around that. That's just like one example. But I would say like the collateral management of it all more efficiency there is ultimately good for velocity and something that we are for.

What's your current thinking in terms of the timing of implementation of solutions like that where new settlement structures emerge and are real and tangible? And then maybe how does that play together with your investment in mortgage Canton Network?

It's a good question. It's tricky because I would say things tend to evolve at different rates than we think. And we're moving a big, big kind of ocean liner around all of this.

We've had a very long-standing relationship with Don Wilson, who's the founder of DRW. We think he's like top of the list in terms of smart people, practitioners in the space. He's very passionate about it. He'll say very clearly from his perspective, ultimately, all financial transactions will wind up on chain within the next 5 years. And then I'll say like I've always been kind of like a little wrong on timing. He might be wrong on timing to some extent. But I think directionally speaking, he's on to something big.

The challenge is not to say always around the kind of like the herding of the cats of it all. It's just getting everyone online and ultimately making the kinds of investments needed to move this forward.

We've done -- I think one of the reasons why we've connected with him really well is because of the reach that we have to the network. So he likes us, and that's certainly part of it. But more importantly, it's because we're able to go into BlackRock in probably a different way than a Canton Network would on their own and really strike the right chords with firms like that and ultimately, hopefully make that light bulb go off around the efficiencies that the market would have through a better settlement cycles and things like that.

Your largest shareholder, LSE Group, has been on the news recently due to an activist shareholder. In addition to their governance role, they're also a partner in some trading solutions with Tradeweb and a key distribution avenue for your market data. Does LSE's ownership of Tradeweb make Tradeweb a better company?

Yes. I think, first of all, I would say this, like I think the relationship with LSEG is really good. And part of my job as CEO is to do a couple of things.

One is to make sure from our perspective, we coordinate, collaborate and communicate, it's like three Cs. Coordinate, collaborate and communicate with them like really, really well. I think we do that.

The other thing to make an obvious point is to make sure that every single day, we are a separately managed company. And I am not surprisingly like really, really strong about that. We are a trading business. We are a markets business.

And from our perspective, having a partner like LSEG that can be a distributor of our data, we feel like is a great thing.

I think we can kind of close our eyes and maybe wonder where the world goes and think about what our strategy could be like in a region like China and then ask ourselves the question, could we take a real advantage from kind of a London-based company in China as we look to move things forward there? I think that's like a pretty intuitive kind of place to go.

My other instinct is with my Tradeweb CEO hat on all the time, I feel like we're a really good company, and we're going to be a really good company in low rates, high rates, volatile markets, less volatile markets and then ultimately, with whatever the partnership structure that we wind up in. So really excited about kind of where our business is headed.

The progress that we've made as a company from my perspective, good stories. But it's like in the past. And the future just in terms of technology continuing to be applied to the markets that we are in is quite bright. So I'm feeling like directionally, pretty amped and excited about where we're going.

Got it. Maybe time left for one or two more questions.

Prediction markets are obviously a hot topic right now. What's the opportunity to bring the prediction markets to the institutional world? Because right now, it's largely a retail partner.

Yes. It's interesting. I mean, I was -- I think I mentioned this to you last night. I was at a dinner in November with Jeff Sprecher right as they had done -- as ICE had done the Polymarket's deal. And I was not to say like picking his brain because I don't think you pick his brain like very easily.

But I was intrigued by that. And I kept thinking to myself a little bit from Tradeweb's perspective, living and breathing in kind of macro outcomes, there feels like there's some natural inclination for us around these marketplaces.

And so we were able to hook up with Kalshi and I think begin what I would say is the early steps around a partnership with them that I think will start to make an obvious point around data. I think the concept of our clients getting more sophisticated as they price risk is a one-way train.

As they get more sophisticated pricing risk, are they going to look to incorporate the right kinds of predictive markets into their pricing algorithm? I would say so.

To make an obvious point, from our perspective, at Tradeweb, like all predictive markets are not created equally. There are some predictive markets that we are not the least but interested in and then there are some that we would be exceptionally interested as they have a financial construct to them.

And I think you can talk about the pricing of risk. I think you can talk about the -- ultimately, how data informs portfolio management. So I think there's a natural kind of connectivity around that.

And then to your point, does it ultimately evolve to a place where there's actual institutional liquidity in a variety of these marketplaces. I would say hard to know. I think a lot of smart people think that we might get there. And from our perspective, being willing to always place forward bets, I think, in a smart way, we want to make sure we have that fort manned.

So it's interesting. We got -- when we made that press release a couple of weeks ago, we got more inbound calls from some of our biggest clients asking for seminars, asking for opportunities to learn more about it. And so I think we placed the right flag in the right way if this makes sense with the right kind of company around this, and we'll take it from there. But the world evolves like very quickly on these things, and we want to make sure that we're being obviously as thoughtful as possible on it.

Perfect. I think that's a great place to wrap up. So I appreciate everybody for coming this morning, and thank you very much for Billy.

Thank you very much. Thanks a lot.

Thank you.

All right. Hello again. I'm Alex Kramm, senior research analyst at UBS, covering the U.S. exchanges and business services companies. Excited to have Billy Hult here, CEO of Tradeweb. I think Billy it's the first time that we're sharing a stage together.

My honor.

I'll leave it at that. But no, thanks for coming down to Florida. I think it wasn't a hard sell at this time of the year. Anyways, I usually like to start these discussions very big picture.

So maybe just to get us started, over the last few years, Tradeweb has grown revenues at a 15% rate organically. So a lot of different markets and asset classes you guys are in, very diversified business. So maybe just very big picture, what gives you confidence that these businesses can continue to grow at these kind of rates in the next few years, medium term?

Absolutely. Thanks for having me, Alex. Really appreciate it. Great conference. I was mentioning to you before, like amazing combination of investors that like we know really well, plus a bunch of new investors. So it's been like super productive. Sometimes you can be like locked into a room all day and feel like you want to kill yourself. This has been like just like a fantastic group of investors. So really appreciate it. feeling like super amped about '26.

I think you laid to frame out kind of perfectly. And when we kind of think about why we're excited, we probably think about it for a couple of different reasons, one of which may be like the setup, we think the setup plays really well. And so when we think about the setup, you start with kind of like how we arrived here. So it's been an interesting obviously, a bunch of years in the markets and for our business kind of from 0 rate, 0 inflation to the big kind of roof on rates, big inflation burst that occurred.

Now it feels like we're in like this kind of like good zone around having a general kind of frame of reference around where we are in the rates world.

As I kind of say all that, I would say like a couple of kind of interesting pieces around that. It feels like the Fed has kind of more to do. But that being said, there is a lot of discussion on like the timing of it that kind of debate in the market, particularly on the macro side of the market tends to play very, very well for our business. So that becomes kind of a good outcome in terms of the setup. And then the second thing I would say, which I think is really important. We talk about the concept of deregulation and the things that are happening around deregulation. Hard for me to perfectly describe how much oomph the banks have in their markets business in their trading businesses like that big strut is kind of back.

And as you know very well, Alex, including UBS at the top of the list, Tradeweb has always had a very strong kind of partnership connectivity with the big banks. And so to see the, I talked about this on the earnings call, to see the trading numbers and the way that the banks are performing in the businesses that a company like Tradeweb kind of lives and breathes in macro credit, mortgages, et cetera, really, really good outcomes for the banks to be doing as well as that they're doing. So that kind of plays really well to us.

Those are the things that we feel good about that we can't control, but probably more importantly, in terms of the things that we can control I would say there is still like this fundamental reality that Tradeweb as much success as we've had across the board from government bonds, mortgages, credit, ETF global interest rate swaps, like Tradeweb's biggest competitor in a lot of the businesses we're in is the phone. And so when you think about in 2026 why our clients are still oriented towards picking up the phone and you and I have had this conversation doing business like it's 1986.

It's usually because of large market moving trades, risk-oriented trades, big giant blocks or a version of complexity or negotiation in the market. And so a huge area of the company's big focus is really around fundamentally solving those 2 things. And to be able to put the energy and the resource in terms of solving those things with the momentum that we have in our business, to your point, since I've been CEO now in my fourth year it's 11% growth rate, but really a big second half of the year in my first year, then 29% growth, then 16%, 17% growth last year, a really strong December that we had at the end of the year. And then from my perspective, and you guys could probably hear my enthusiasm on the earnings call, a really strong January.

And so to be able to problem solve with a little bit of momentum, I think, is a tremendous advantage. So feeling really good about the kind of multi-asset class setup that we have. And then importantly, technology is going to continue to arrive in the marketplace. And so half a step back, you have to think about what are the companies that are really set up to solve for the clients' problems and to solve for the opportunities. And my instinct is it's going to be the kind of company that has an understanding that relationships matter. This is still a relationship-oriented business and the kind of company that's set up with the network that we have. So that was a long-winded way of saying I'm excited.

I think it sets up great for some of the other things we're going to talk about. And since you just mentioned a lot of macro and the good backdrop that you have, what about what you're specifically doing in the near term? Any initiatives in particular for 2026 that we should be aware of that you're super excited about? Maybe go there for a second.

Yes. So starting with, when you and I first got to know each other back when we were going public as a company, my very strong instinct was there was understandable, not from you, but understandable kind of skepticism that a company that had lived and breathed in the rate space, could they really ultimately compete and be real in credit. And my instinct is, as a public company, one of the things that we've done really well is show that without question, we can compete in credit and without question, we have the ability to be the real leader in credit. So a combination of IG and high yield, a combination of institutional, obviously in wholesale, the company is not going to take its eye off the ball on continuing to move things forward in credit.

That is kind of priority #1. I would say underneath that, we have a great international business. It gets talked about, but maybe not talked about almost as much as it could be talked about. And so in a world where, obviously, geopolitical risk will be a day-to-day thing. Central Bank divergence globally is going to be a day-to-day thing. We talk a lot about the dedollarization kind of piece of the macro environment now. I think having a really built-out international business is really important. So big focus continuing on EM through our international world, a combination of emerging market swaps and emerging market credit will be a big focus for us.

And then I would say, kind of the third thing, if you think about credit, the kind of EM world. And then the third thing I would say is the rates complex will continue to be very, very interesting with more innovations to come, specifically speaking, inside of rates. So it's a little bit of this continuation of what we do. We don't take our eye off the ball in our kind of core businesses, and we continue to try to navigate change that occurs through technology, whether or not that's day-to-day change or change within market structure. They're really important kind of interesting trends to navigate through.

Okay. I want to dig a little bit into the business. And you mentioned it a little bit, but you didn't really lean into interest rate swaps in your last answer. So maybe I want to start there because it is, unless something has changed to your largest business, and you also have a very strong market position in that business. And I sometimes actually think it doesn't get enough attention from investors, quite frankly. So your market share continues to move higher. The business is only 30% or so electronic today. So when we think about interest rate swaps, again, your largest business, where do you think that can go in terms of electronification? And of course, how do you keep your dominant market share position today?

Yes. I was thinking about mentioning, but kind of feeling you were going to ask me so I don't want to kind of bury the lead.

It's a nice how you see me [indiscernible], thank you.

If anyone is ever kind of wondering whether or not things can really change in the markets that we're in, in some ways like the global swaps platform is like the perfect example of how quickly a marketplace can change. And when I say that or when I describe that, what I would say to you is of all the different businesses that we were in, global swaps was like the most back alley of the back alley markets. It was voice-driven, always voice-driven and will always be voice-driven until ultimately, technology arrived in that market. And now to your point, it's our biggest business, most profitable business. And in a lot of ways, I would agree with you I think it's like our most important business. And so that's a big deal.

It's also as transparent and as sort of, whatever the opposite of back alley is, a spotlight oriented as that business has become. It's also a business that Phil has, to your point, a lot of room to go on continued electronic penetration of voice activity. And so we're very, very focused on probably 2 or 3 things inside of the global swaps world. One, I would say, continued risk trades in swaps that we do through micro protocols. I talk a lot about this protocol called request for market. It's just a different way of a client engaging in the marketplace, but it gets after the risk that's really important when you think about those kinds of volumes.

Two, I would say, continued, this is really important, continued market share in emerging market swaps. That's a big emphasis for us. We are going to focus on the non-cleared side of the swaps market as well. I would say, not that there's like any by definition, like low-hanging fruit stuff, that's not low-hanging fruit. It's more structured swaps, it's more voice orientation. It's more negotiated types of trades from our perspective, putting in the work to actually begin to solve for that kind of activity is important.

And then lastly, and this is important, Alex, like we work really hard at Tradeweb around solving different pockets of issues inside of market structure. So the company that you guys here in the audience know really well mostly is focused on the institutional side of the business, but we're also big in retail and also quite big in wholesale, as you know. The wholesale side of the swaps market is largely voice-driven. And so what we're beginning to do is to find the advocates who have benefited from the electronification on the institutional side to be our kind of body guards as we work through the wholesale side of the market in swaps. So there's still as well as that business has been for us.

And I would say probably the most to your point, underappreciated kind of success story of the company, there's still a ton of room around further electronification there. And so that's the thing that we have to do is focus where the activity is.

Okay. Very good. Let me stay on rates. And we should also talk about your legacy business, which you mentioned, right, U.S. treasuries. I believe, still the third largest business for you today. I think electronification is pretty far along. There is more competition. So again, given that it's still a meaningful business and your heritage, where is the incremental growth coming from? And then you entered the wholesale market a little bit more a few years ago. Maybe it's been mixed so far. So is that still a big focus for you? And what's going to turn that around?

Yes. So like, you're right. So like treasuries was like the first market that we were in like way back when. I see Larry in the stands. You were working at Tradeweb and like that's what all Tradeweb was known for was like we were a kind of client dealer treasury platform. So we've come a long way from being obviously a single product business. I think there's a real skill as a company to be ambitious around expansion and not take your ball off of the most important businesses that you're in. So we really work, I think, on achieving that balance.

I would say within government bonds, we have put a lot of time and effort into something that we call AIX. So if I were going to describe that to the room, what I would say is like the first real breakthrough was getting people to stop picking up the phone and calling the salesperson and doing all of that stuff to be using actually Tradeweb through a log-in and a keyboard and a mouse and all of that stuff.

The next big breakthrough, and I think we're still early innings in the breakthrough, but we're in the breakthrough zone is much more of a move towards algorithmic trading. We call it AIX connectivity, but it's basically smart searches that our clients use to find pockets of liquidity in the space, with a tremendous amount of respect towards Bloomberg. And we've essentially been competing with them since day 1 their orientation, not surprisingly because they're so great at like the analytics and the messaging and the desktop of it all. Their orientation is always going to be to be protective of the desktop. And in their protectiveness of the terminal there's an opportunity for us to run with what is this next wave of engagement, which is all going to be around smart searches.

And so when I describe as smart search, what I would say is the random walk of guessing or looking for or trying to understand where liquidity might be, is essentially coming to a version of an end. And so back in the day, when Tradeweb would spend time with a buy-side client and see how that client would actually use Tradeweb they would see that like the client would click on Bank of America and then Citi and then Deutsche Bank, and they would maybe wonder why the client was choosing those 3 dealers.

And the answer was that, that client just had his ticket arranged by like BCD, alphabetical. And the reality is, as we're kind of like thinking about the skill sets continuing to evolve, clients are no longer guessing when they want to buy 50 million 5-year notes, who are the 2 or 3 dealers, they should show that inquiry to. They understand where the kind of act seller is. And my instinct is that's a wave of innovation that's going to be really important, ultimately solving for the things that we care about the most, risk trades and complexity.

So we're really excited about that kind of evolution. And we're putting a lot of energy there. We've hired, as you know, like a bunch of really smart kind of data scientists, and we're kind of plowing through that no one feels by any stretch ever sorry, for Bloomberg. But there's a vulnerability that they have just around the way that the machines are going to connect to markets. I think that's an important trend for us to make sure we're behind the right way.

Excellent. I need to turn to U.S. credit, of course. I think it's the one that you mentioned first when it came to 2026 initiatives earlier. So if I go back over the last few years, huge success story. Market share seemingly was only going up in a steady trend. I think at the same time, portfolio trading was becoming a bigger part of the market that helped you because you're a leader there. So -- and still our leader there. Seems like things have gotten a little bit more competitive. So if you look forward from here, what are the biggest opportunities to kind of reaccelerate that market share gain that everybody seemingly cares a lot about.

It's true. 100% right. It's in some ways like the most competitive business that we're in, plus the most scrutinized. And so thus, my concept of like one of the things that we're focused on the most, obviously, is credit. Understanding that story, I think, is important as you guys think about like the approach that a company like Tradeweb takes in credit. So I mentioned how well the banks were doing vis-a-vis the kind of deregulation moment that we're having to make an obvious point that wasn't always the case.

And I think as credit was emerging as a more technology-oriented marketplace reminder, the banks were going through, in some ways, like the teeth of regulation. And then going through the teeth of regulation, they kind of pulled back some of the liquidity that they were providing in credit. So the immediate kind of table stakes protocol in credit, either -- if Chris was on stage, he'd be talking about Open Trading since it's me, I'm talking about all-to-all trading, the immediate protocol in credit that gained traction was a protocol that essentially disintermediated the banks from their clients. It kind of bypassed them in the search for liquidity and allowed BlackRock to connect with Vanguard out there in the liquidity pools, not surprisingly, the banks had a very strong reaction to that, including UBS.

And so Tradeweb, because we have a history of working with the banks, our first kind of foray in terms of being competitive and trying to sort out how we would add value was really through creating and being a part of trading protocols like portfolio trading which is basically the opposite of all-to-all trading. It tends to be more noncompetitive and it breaks down these big, long bid lists and offer lists into a synthesized trade. It's a very, very cool protocol.

As I describe all of that, like massive move in this direction around open trading, all-to-all trading and the massive move in this move in this way around portfolio trading, what I've skipped is the most fundamental and in some ways, straightforward step in this electronification journey which is RFQ trading, right, which is something you remember, Larry, from like way back when. It's like the most basic way, RFQ to few. I'm a buy-side client and I want to ask UBS, JP Morgan and Morgan Stanley to price something.

Ironically, as the market has now evolved and the banks have stepped back in, they've learned a lesson, they're better capitalized. The whole thing is now fitting together better, my very strong instinct is RFQ trading is actually a very strong area of growth within the protocol segments of the market and an area that we put a tremendous amount of time and energy in partially leveraging the strengths that we've kind of gleaned off of AIX and smart search routes.

So credit is so interesting because the market structure developed in different ways than other businesses have. And it's not that we're going back to basics in it, but you have this amazing convergence now of the banks having learned a lesson, Oh, and by the way, firms like Citadel and James Street playing critical and very important roles as liquidity providers. So it's a competitive market. for sure, and a market with a tremendous amount of innovations that have occurred in a relatively short period of time. So the view in-house at Tradeweb is the firm that's going to win is going to be the firm that can keep the banks on site as partners through this next evolution plus continue to invest around innovation, plus, I would say, in a really important way. have the kind of multi-asset class acumen to be able to bring in kind of adjacent markets, government bonds, et cetera, because credit trades on spread and add efficiencies to the client workflows.

Okay. Since we're talking about U.S. credit, I think it's also a good position of time to talk about pricing because it does seem like in that space, in particular, competition is a bigger focus. There's some disruptive competitors out there. So it would be helpful because there's a lot of mix going on, but it would be helpful to also know how is pricing really trending on a like-for-like basis, what's happening in the space. And I know I asked about credit, but maybe since we're talking about pricing broadly are you seeing any pricing pressure elsewhere, for example, in your rates?

Yes, it's a good question. It's a really good question because like talking about all these great stuff and innovations and market share growth, but like pricing matters. And so I fully appreciate your question. I would say like a couple of things to start. One, I made the point that we were -- we've been competing against Bloomberg like since day 1. Everybody kind of knows this. Even though Bloomberg would kind of see that their trading business was for free, it really wasn't.

That being said, from a line traders perspective when Tradeweb is charging because we were commercial from day 1 and Bloomberg wasn't, we dealt with and we understood the realities of innovating and being commercial and understanding that there was someone out there trying to undercut you on fees. So we have a long history on this. The most important lesson, I think, I learned around building these businesses, not that long ago, as I sat down as we were beginning to become marginally real and marginally successful in credit.

And I sat down, Alex, with a guy at Wellington in Boston, a portfolio manager who we knew and who we liked, but he wasn't a good client of ours in credit. And he said to me something along the lines of with respect, if you go down the path of copying exactly what market access does well and charging us less, you will fail. You have to do more. You have to create innovation. You have to do something that actually saves me time and saves me money, and you have to do something from my perspective that's better.

That was a good piece of advice. And that probably led us very clearly down the path of, okay, let's not just do what they do well and charge less. Let's actually figure out like other things to differentiate ourselves at spotting and hedging portfolio trading and things like that. That being said, to your point, from my perspective, I want to be like really clear about this. Never want to like ignore realities of like of price and pricing pressure. And we provide a service and one of the things that matters to me a lot is we are the preferred partner of the industry. And we have a lot of businesses where we have a lot of market share and a lot of momentum. And I never want the company to lose its place, hopefully, always #1 in the queue on like problem solving.

And so we're -- we've been flexible. We've been understanding that there have to be moments in time where we have to shift the pricing model from variable to fixed, and we're going to do those things. That being said, we are not giving up the wallet potential in our business. And we feel like, and I said this on the earnings call and people had a pretty strong reaction to it, the profitability that our partner banks have in the space that we live in is off the charts high, off the charts high.

And so I'm pretty good, and I'll be pretty clear at making sure all these years later that I remind the right person at these firms, how well they're doing in the space, which I think make sure that people keep their eyes on what they should be focusing on, which is the value ultimately that you're bringing into the equation. I say this all the time, Tradeweb has amazing clients, but the most important thing to understand is there's not a client that we have a more important relationship with than UBS does or that Goldman does or that Morgan Stanley does, right? So in some ways, we're the guardian of the bank's relationship with their clients in these really important markets and we understand that. And I think that's a really, really important kind of premise to make sure that is kind of clear. So that's -- it's an interesting time, though, for sure.

All right. Getting -- moving on to some bigger picture questions now. I actually asked about this on the earnings call already, but maybe it's a good time to kind of dig deeper here, which is really this concept of tokenization of assets actually was a big focus already on the -- at this conference over the last couple of days. I know you have some initiatives already in the space, Canton Network, for example, maybe talk about what you're doing in particular, how it can be a driver of the business and how quickly it can play out.

And then, of course, the flip side of it all, if we're going down this route in certain asset classes, how do you actually stay relevant? How do you make sure you're not getting disintermediated as the market maybe market structure evolves and there are other rails, I think I said on the ad side.

That's a really good question. It's a really important kind of time to ask that question. Like 2 things to remind ourselves, like the fixed income market has come a long way. It's gone from back alley to transparent. A lot of the ways that fixed income works, works really, really well. That being said, there's always kind of room for improvement. There's going to be more and more transactions that wind up kind of on chain. We've had a -- we've been a company, I think, that's been pretty good at understanding in a lot of ways, who are the thought leaders in the space, who are the smartest people in the room, how do we make sure we align ourselves with the best practitioners, most innovative person.

Not surprisingly, we always had a pretty close relationship with the hedge fund DRW. They play a significant role inside of the rates dynamic. We know Don Wilson, who's the CEO and the founder of DRW. He's an innovator. So we were very well aware of what he was doing on the digital asset side. sometime around December of '24, January of '25. He placed the phone call in to me. He said, "Hey, look, I think we have a 1 in 3 chance to be the kind of the collateral guardrails of the market.

He's smart, not always right, no one's ever always right, but he's smart. And we had a very strong in-house instinct that he was maybe right and maybe on to something. The good news is he relied on us or he understands the role we play really around almost like herding cats, but we're able to have our own relationship with Goldman or our own relationship with BlackRock and help fill out that network.

So we became kind of early investors and early adopters into the Canton Network. And that's been really good for us. In a lot of ways, we're learning a ton, which I think really, really matters all the time. Plus, we have some strong instincts that there are markets that we live and operate in that could fundamentally benefit from things like efficient, more streamlined settlement structures. I've used the example a lot, Alex, of the TBA mortgage market, which, as big of a market as it can be at various times still settles 30 days, et cetera, out in ways that proclude some types of firms playing really strong roles in that market. It precludes that market from hitting something that you guys hear about a lot that's really important called like velocity.

And so we're for that. And we're for more entrants -- more entrants into that market and we're for more velocity. And so therefore, we can partner with firms like Canton on really helping solve some of these kind of workflow situations. And so feeling like really, really good about this. As you know, we moved one of our most talented people in the company into our Chief Product Officer. He's got a bunch of people working for him. I think the company is trying really hard to put the right level of focus and bandwidth into the continued kind of emerging technology/disruptive world. It's fascinating time around that.

Since you just mentioned emerging technologies, you'll clearly teed me up well again to talk about, I guess, automation and AI in general. You talked about AIX earlier and things like that. But like, yes, maybe just coming back to that or hopefully expanding like what are the biggest use cases on things like AI and how has it already maybe helped your business?

Yes. So it's a couple of things. It's got to make sure you are really bringing the right kind of people in-house with the right skill set. And we've worked very hard on making sure we're the kind of firm that the brightest minds in the space want to work for. So we're really excited, Alex. We hired a woman named Sherry Marcus to run our AI technology and our AI strategy. She's like off the charts. A combination of I think in AI, kind of I don't quite have this at all. Actually, I'm very far away from it. That kind of AI cognitive brain plus she has like real experience of thinking about and working about how machine learning and AI kind of lives and breathes in the market.

She's making our AI expertise or AIXness, the thing that we've already been kind of like running with and running with really well, she's making that better. And that's really important because we view that as like a little bit of a special sauce and a little bit of something that our direct competitor can't compete with us on. And then another thing I would just kind of say is, obviously, like we live and breathe in the world the same way that you guys do. So we're always going to be kind of oriented to like how do we make our day-to-day functions inside of the company, ultimately more efficient and more effective. And so for sure, we're going down the path now where our Investor Relations team, which is amazing, obviously. They're spending more time now around AI stuff to get themselves more organized.

And that's going to -- that's part of life now. I find it very interesting. I made this joke to you before, like I was an English major in college, so it's like all kind of like pinch-me moments to be working out a company and being the CEO of a company that is a bit in the forefront around this, but like specifically around fixed income in the forefront. I view a very basic thing as fundamentally important, which is like all intelligence ultimately is always about learning.

And so I push people, I hope, in the right way to continually kind of learn, specifically in this space, which Ashley and I were just talking about this means like going down like -- not to say like go down rabbit holes to go down rabbit holes but make sure you're trying new things all the time because the shape of it all is shifting and changing pretty dramatically, which is fun.

Okay. Shifting gears, one of the questions I get from investors, a decent amount is about some of these new emerging players in the marketplace. And you mentioned them yourself, Citadel, Jane Street, so some of those companies. So some investors certainly view their growing press as a risk to you. I know you're also partnering in some areas. So maybe just walk through this where are they partners, where are they may be disintermediating you or go around you. How do you see this all playing?

Yes, it's interesting. It's really interesting. It's multidimensional, right? Because there's no question that firms like Citadel firms like Jane, firms like Hudson River are fundamentally now real in fixed income and ascending into the world pretty dramatically. Jane is Jane and their numbers have been phenomenal. And Citadel, I think, put them at the top of the list of one of the most kind of ambitious companies obviously out there in the ecosystem. They're accelerating what Citadel has been able to accomplish in global government bonds, global interest rate swaps. Now they're moving into credit. If the mortgage market moves in new directions, I would imagine that they'll kind of arrive there. They're accelerating.

They're doing that all at a time, not when the banks are back on their heels. That, I think, is actually pretty interesting because we're a long way from the banks kind of being back on their heels and all of the stuff being kind of easy peasy march towards like colonization of markets, like this is going to be a pretty interesting kind of back and forth that will develop. I would say on the kind of frenemy side, don't feel that as much. Again, genuinely don't feel as much like there's some thing that winds up all of a sudden making Citadel like a global operator of markets, and we've somehow got disintermediated. I would say eyes wide open, you have to work pretty hard at getting the relationship in the right level of candidness around problem-solving with those kinds of firms.

Genuinely or generally, I should say, it's when the liquidity comes, they were there, and they'll pay you for it. But if the liquidity doesn't come like they're not around, right? And we've had to work pretty hard on establishing the kind of relationship that has always been the company's little bit of secret sauce, which is idea generation and being the partner with the smartest firms to solve problems. And so I sometimes feel like I'm a better spokesperson for them than they are for us, which is okay because not every relationship is perfectly symmetrical.

But like where this plays out over the next couple of years, I think, will be fascinating. There's no question that we'll be talking about this dynamic for a while because you have the legacy banks that held on to their IP with an oomph in the business an oomph in their staff, understanding what firms like Citadel have been able to accomplish in equities and then you have firms, nonbank liquidity providers, firms like Citadel seeing the levels of profitability that exists inside of fixed income, this is going to be like the NFC West this is going to have like 3 teams that could play in the Super Bowl kind of like in the same conference, it's like strength on strength, sort of.

So it will be a fascinating outcome in terms of this. My instinct is it's good stuff because that's where innovation comes and everyone is kind of running much more aggressively, the concept of, let me hope this electronic thing goes away is kind of out of the equation.

I was going to ask about expenses next but, a, Sarah isn't here. I'm sure you're going to be bought with it anyway. So I'm going to skip ahead looking at the time or if that's okay. If you want to talk to expenses you can.

No, no, man.

But I think more important is capital allocation, in particular around M&A because since you've come in as CEO, I think you've been a little bit more on, I guess, on the forefront of it or at least talking about being more willing and looking and you've done a few deals, but they've been smaller, I guess, relative to the size of the company. So just maybe to finish this off here, where do you think M&A fits into the company today? What are the areas that you want to participate or the areas that we still think there's room for upside in?

Yes. The smaller deals that I think all went like well, which I do think says a fair amount. I think it shows the market that we're capable of doing M&A in a bunch of different ways. That being said, I think not to say I am what I am, what I am. But I do think that the ethos of the company is a lot around ultimately building and there's a reason probably, Alex, why you started with like where do you see the most important opportunities going forward organically because there's a lot there.

And there's a lot of focus inside of the company to continue to build out the presence that we have in all of these businesses. It's quite exciting for us. That being said, we are going to be open-minded and I think, make the kind of choices around M&A that you guys would expect us to. I think there will be consolidation moments that obviously will occur in the space. And I think the general view is that like the momentum that we have in the businesses that we are in gives us opportunity to do the kind of deal that we think makes sense. I will say this just very, very bluntly, culture, I think, is likely exceptionally important.

There's a very strong culture at Tradeweb, and that's not the kind of thing by any stretch that we would be willing to kind of trade off as we look at the opportunities in front of us. But my instinct is, you'll see -- you'll hear and see more from us in the right way on that topic.

Good way to end it, I think. So everyone in the room. Billy, thank you very much. Help me thank him.

Thank you, guys.

Good morning, and welcome to Tradeweb's Fourth Quarter 2025 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.

Thank you, and good morning. Joining me today for the call are our CEO, Billy Hult, who will review our business results and key growth initiatives; and our CFO, Sara Furber, who will review our financial results.

We intend to use the website as a means of disclosing material, nonpublic information and complying with our disclosure obligations under Regulation FD. I'd like to remind you that certain statements in this presentation and during the Q&A may relate to future events and expectations, and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements related to, among other things, our guidance are forward-looking statements. Actual results may differ materially from these forward-looking statements. Information concerning factors that could cause actual results to differ from forward-looking statements is contained in our earnings release, earnings presentation and periodic reports filed with the SEC.

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

Now let me turn the call over to Billy.

Thanks, Ashley. Good morning, everyone, and thank you for joining our fourth quarter earnings call. I am extremely proud of the Tradeweb team that helped produce the best revenue year and quarter in our history, crossing $2 billion in annual revenue for the first time. Our 2025 performance continues our seventh consecutive year as a public company, producing double-digit revenue growth and the 26th consecutive year of record annual revenues.

As I look back at 2025, a few thoughts that come to mind are our clients focus on data-driven tools for larger and more complex trades, the acceleration of automation and the growing interconnectedness of global markets. As we look ahead, our ethos stays the same, continue to put forth rigor and discipline to help drive more innovation across our expanding markets.

Our clients are now operating with an increased level of integration and sophistication across our markets. We saw real traction in the extension of electronic trading into areas that had previously been mostly manual from uncleared swaps and swaptions to block trading and global credit. Liquidity has become more interconnected across assets, regions and time zones, essentially breaking down those historical silos that used to dominate our clients' workflows. At the same time, we have made significant strides alongside our key partners in moving digital assets from something built on a whiteboard to a real advancement in market infrastructure and how our clients are thinking about trading and settlement. As we sit here at the intersection of TradFi and DeFi, we will continue to partner and invest across the digital asset landscape to deepen our network and drive more workflow efficiency solutions for our clients.

Diving into the fourth quarter on Slide 4. Despite tough comparisons, strong client activity, share gains and a risk on environment drove 12.5% year-over-year revenue growth on a reported basis. We continue to balance investing for growth and profitability as fourth quarter adjusted EBITDA margins expanded by 39 basis points relative to the fourth quarter of 2024.

Turning to Slide 5. Rates produced a record revenue quarter, driven by continued organic growth across swaps, global government bonds and mortgages. Credit growth was led by strength across European credit, Munis, CDS and emerging market credit. Money markets revenue growth was led by record quarterly revenues across global repos. ICD balances continue to recover post the tariff volatility and ICD revenues were up 11% relative to the third quarter 2025. Equity saw growth of almost 10% year-over-year, led by growth in global ETFs and equity derivatives. Other revenues grew over 90% year-over-year as our emerging digital asset initiatives continue to scale. Finally, market data revenues were driven by growth in our recently renewed LSEG market data contract and proprietary data products.

Turning to Slide 6. Our record fourth quarter capped off a record revenue year in 2025. Record volumes across all asset classes translated into 19% annual revenue growth on a reported basis. The scale generated by our strong top line results drove 64 basis points of adjusted EBITDA margin expansion, 19% adjusted EPS growth and 32% free cash flow growth. As our growth initiatives continue to scale, we maintained our tradition of constant and focused investment.

Broadly, we enhanced our existing product capabilities, added new clients and forge new partnerships. On the capability front, we achieved many first. We completed the first ever fully electronic bilateral swaptions and U.S. multi-asset package trade across the swaps market. We launched the first electronic platform for Saudi Royal bonds and Mexican repos, and we launched portfolio trading in the European government bond market. We expanded our offering to ICD clients, allowing them to buy treasury bills directly through the platform. Additionally, we enhanced our RFQ offering across U.S. credit and ETFs and rolled out our dealer algo solutions within U.S. treasuries.

Beyond our core markets, we've been very focused on the future, especially the digital asset space. We have partnered with numerous startups and thought leaders and we completed the first ever on-chain U.S. treasury repo transaction done over a weekend and the first ever on-chain auction for brokered CDs. We believe our investments in our core and frontier markets position us well for the future and also help to make 2025 another banner year for Tradeweb.

Moving to Slide 7. 2025 continued the streak of robust revenue growth that we have worked hard to deliver for multiple years now. Specifically, while the majority of our revenues still come from rates, 42% of our annual revenue growth came from our other businesses in 2025. In fact, since the IPO, almost 50% of our revenue growth has come from non-rate businesses, with 45% of that growth from our rapidly expanding international business, which grew at 20% CAGR over the same period.

Our European business continues to anchor our international presence but our Asia Pacific product suite continues to scale. In 2025, our Asian client revenues grew over 35% and European client revenues grew over 25%. Strong momentum across Europe and Asia comes from connecting a global client base to local international markets.

Relentless innovation has been critical to our success. Throughout our history, we have prioritized being first to market which requires constant investment. In the last 5 years, we have invested over $600 million in technology to help shape the future of electronic markets, growing these investments at an average of 16% since 2020. As our investments bear fruit, adjusted EBITDA margins have expanded consistently.

Turning to Slide 8. This quarter saw yet another meaningful decline in intraday volatility from the elevated levels seen in prior periods. Specifically, volatility was down 27% year-over-year and 15% quarter-over-quarter. Despite the lowest intraday volatility that we have seen in the last 4 years, our U.S. treasury revenues increased modestly by 1% year-over-year as continued strength in our institutional channel was offset by weaker retail trends. Our quarterly market share increased sequentially with December market share reaching the highest levels since February of 2025. As we look forward, we are optimistic on a reacceleration in U.S. Treasury business as we penetrate additional parts of the voice market, coupled with continued strong government debt issuance and normalization and rate volatility. Our competitive position remains strong on a relative basis. We exceeded 50% for the seventh consecutive quarter in electronic institutional U.S. treasuries versus our main electronic competitor.

Turning to wholesale U.S. treasuries. Revenues were flat mainly driven by lower volumes across our wholesale streaming protocol partially offset by growth across our sessions protocol. Wholesale remains a strategic priority as we focus on onboarding additional liquidity providers and strengthening our liquidity pools in support of our multi-protocol holistic platform strategy.

In equities, ETFs posted strong double-digit revenue growth as we continue to deepen integration with our clients. During the quarter, we continued to leverage client workflow connectivity by delivering a more automated ETF trading solution in partnership with ION. Our AiEX automation solution has been a key differentiator with our ETF clients with average daily trades increasing over 70% year-over-year. While AiEX is deeply penetrated across European ETFs, we continue to see strong adoption across U.S. ETFs with AiEX average daily trades up 28% quarter-over-quarter. Our efforts to broaden our equity presence beyond our flagship ETF franchise continue to pay off with record institutional equity derivative revenues up 18% year-over-year. Looking ahead, the pipeline remains strong as the benefits of our electronic solutions continue to resonate with our clients. We believe we are well positioned to capitalize on the long-term secular ETF growth story, not just in equities, but across our fixed income business.

Turning to Slide 9 for a closer look at credit. Low single-digit revenue growth for the quarter was driven by strong double-digit revenue growth across European credit, municipal bonds, credit derivatives, China bonds and EM credit, which more than offset weakness in U.S. credit, where revenues fell year-over-year, mainly due to retail corporate credit revenues that were down nearly 30% year-over-year, primarily reflecting the better relative yields our clients were getting across money markets and munis.

U.S. credit remains a key growth initiative. We are focused on maintaining our leadership position in our pioneering portfolio and session trading protocols and increasing our block market share. Perhaps most importantly, we continue to increase our RFQ share, which we expect to be the #1 driver of revenue growth in U.S. credit going forward. Our deepening liquidity pool and continuously improving client experience is resonating as we attract more clients and experienced talent across the board. Our efforts to expand into RFQ are seeing early signs of success with our RFQ share of overall TRACE achieving a new quarterly record. Institutional RFQ average daily volume grew over 10% year-over-year with growth across both IG and high yield. We also saw continued block share growth in fully electronic U.S. investment grade and U.S. high yield of over 130 basis points and 65 basis points, respectively. This growth was broad-based, driven by continued adoption of our portfolio trading, RFQ and sessions protocols. More broadly, we saw active user growth of 18% year-over-year during the quarter as we continue to strengthen our U.S. credit client network.

Portfolio trading average daily volume also increased 10% year-over-year with over 20% growth across international PT. Portfolio trading has become a widely used, reliable method for executing trades and managing risk, particularly during periods of market volatility. As the market continues to evolve, we expect adoption to expand as it further embeds itself as an essential part of credit traders toolkits. All trade had a strong quarter with over $200 billion in volume, with average daily volume up over 14% year-over-year. Our all-to-all average daily volume grew over 45% year-over-year, while our sessions average daily volume rose by nearly 10% year-over-year. The team remains focused on expanding our network and increasing the number of responders on the AllTrade platform. In the fourth quarter, we saw the fourth highest level of ETF market maker participation ever across our institutional credit business.

Beyond U.S. credit, we're continuing to prioritize our emerging markets credit expansion efforts. We continue to broaden out our liquidity provider set across key markets, work with our OMS partners on key integrations and expand the functionality around key differentiators such as asset swaps. While still early in the journey, EM credit revenues grew 25% year-over-year in the fourth quarter, signaling strong momentum.

Moving to Slide 10. 2025 represents the 20th anniversary of our electronic interest rate swaps platform. Back in 2005, electronic swaps trading was still an emerging idea. Two decades later, it has become an ecosystem defined by transparency, efficiency and ongoing innovation. Our leading position in the swaps market has been built upon 2 decades of helping to shape global regulations, maintaining a regulated global footprint, cultivating a deep client ecosystem and expanding a broad suite of adjacent global rates products.

Global swaps delivered record quarterly revenues, up over 25% year-over-year, driven by a combination of strong client engagement across our global suite of currencies that drove strong risk trading growth and a 7% increase and weighted average duration. Our quarterly core risk market share, which drives revenues and excludes compression trading was a record, rising over 70 basis points year-over-year. Total market share increased from 20.8% in the fourth quarter of 2024 to 23.3% in the fourth quarter of 2025 due to a combination of strong risk and compression volume growth. During the quarter, we achieved the highest share in our history across euro, other G11 and EM denominated currencies.

The fourth quarter performance was driven by record revenues across Europe, APAC and emerging market swaps, while we produced double-digit revenue growth across dollar swaps. We continue to make progress across emerging market swaps and our rapidly growing RFM protocol. In EM IRS, structural challenges like geographic dispersion, pricing opacity and operational inefficiencies have historically made voice trading in the norm. We're helping to drive more discrete, transparent and efficient execution, especially through innovations like RFM and AiEX. Our fourth quarter EM swaps revenue produced another strong growth quarter, and we believe there is still significant room to grow given the low levels of electronification.

Our RFM protocol which is seeing strong adoption across currencies, also saw average daily volume grow more than 90% year-over-year with further adoption picking up. Looking ahead, we continue to believe the long-term growth potential for swaps remain significant. On a DV01 basis, electronification has continued to increase with 2025 DV01 based electronification up more than 90 basis points year-over-year and growing at an average rate of over 150 basis points annually since 2020, as dealers and clients move a greater share of their workflows electronically. That progress is evident in the performance of our swaps business, which has continued to deliver strong revenue growth in the fourth quarter.

On a notional basis, the cleared swaps market remains approximately 30% electronic, and we see significant opportunity to continue digitizing workflows alongside our clients. In collaboration with them, we expect to drive further workflow innovation in 2026 across both cleared and bilateral swaps markets.

And with that, let me turn it over to Sara to discuss our financials in more detail.

Thanks, Billy, and good morning. As I go through the numbers, all comparisons will be to the prior year period, unless otherwise noted.

Slide 11 provides a summary of our quarterly earnings performance. As Billy recapped earlier, this quarter, we saw record revenues of $521 million that were up 12.5% year-over-year on a reported basis and 9.9% on a constant currency basis given the weakening dollar. We derived approximately 42% of our fourth quarter revenues from international clients and recall that approximately 30% of our revenue base in denominated in currencies other than dollars, predominantly in euros.

Total trading revenues increased 11%, comprised of 10% variable trading revenue growth and 18% growth across fixed trading revenues. Rates fixed revenue growth was primarily driven by an increase in minimum fee floors for certain dealers and by the addition of dealers to our mortgage and U.S. government bond platforms. Credit fixed revenue growth was primarily driven by the previously disclosed introduction of minimum fee floors and the migration of certain dealers to subscription fees.

Other revenues of $13 million for the fourth quarter increased by 94%, primarily driven by growth in our digital initiatives. Specifically, we earned $6.6 million from our commercial relationship with the Canton network from our role as a super validator on the network, where we are compensated in Canton Coins.

Assuming similar Canton Coin pricing as in January of 2026 and based on our current estimate of earned coins, we would expect 2026 Canton related revenue to be similar to 2025, which was approximately $11 million, but this can vary. Overall, the other revenue line will remain variable quarter-to-quarter, reflecting fluctuations in the number of Canton coins earned, Canton Coin value, the number of super validators in the network and periodic tech enhancements for retail clients.

2025 annual adjusted EBITDA margin of 54% increased by 64 basis points on a reported basis when compared to our 2024 full year margins. Our net interest income of $18.8 million increased due to higher cash balances despite lower interest yields. Lastly, this quarter's GAAP results were impacted by both unrealized and realized gains across our strategic investments. Specifically, we recorded $207 million in net gains this quarter, including $180 million of unrealized gains, reflecting the mark-to-market of our Canton Coin Holdings and $25 million in realized gains related to our exchange of Canton coins for warrants in the digital asset treasury company, Tharimmune. As a reminder, these gains are only included in GAAP EPS and are excluded from our non-GAAP adjusted diluted EPS.

Moving on to fees per million on Slide 12 and a highlight of the key trends for the quarter. You can see Slide 18 of the earnings presentation for additional detail regarding our fee per million performance this quarter. For cash rate products, average fees per million were down 5%, primarily due to a mix shift away from U.S. government bonds, which carry a comparatively higher fee per million. For long-tenor swaps, average fees per million were up 2%, primarily due to higher duration. For cash credit, average fees per million decreased 14% due to the migration of certain dealers from fully variable plans to fixed plans across institutional and wholesale U.S. credit and a mix shift away from retail within U.S. credit, which carries a higher fee per million.

For cash equities, average fees per million decreased 10% due to a mix shift away from European ETFs, which carry relatively higher fee per million and a reduction in U.S. ETF fee per million given an increase in notional per share traded. Recall in the U.S., we charge per share and not for the notional value treated. Finally, within money markets, average fees per million decreased 6%, primarily due to a mix shift away from retail CDs, which carry a comparatively higher fee per million.

Slide 13 details our adjusted expenses. At a high level, the scalability and variable nature of our expense base allows us to continue to invest for growth and grow margins. We have maintained a consistent philosophy here. Adjusted expenses for the fourth quarter increased 12% on a reported basis and 9% on a constant currency basis. During the fourth quarter, we continued investments in tech and communications, digital assets, consulting and client relationship development. Adjusted compensation costs grew 5%, driven primarily by an 11% year-over-year increase in head count, partially offset by lower accruals for performance-related variable compensation.

Technology and communication costs increased 24%, primarily due to our continued investments in data strategy and infrastructure and increased software costs. Adjusted professional fees grew 17% due to an increase in tech consultants as we augment our offshore technology operations and due to episodic advisory fees related to legal, tax and consulting services.

Occupancy expenses increased 59%, primarily from increased rent due to the move to our New York City headquarters. Adjusted general and administrative costs increased 27%, primarily due to unfavorable movements in FX and a pickup in travel and entertainment and marketing expenses. Unfavorable movements in FX resulted in a $3.7 million loss in the fourth quarter of '25 versus approximately a $1.1 million gain in the fourth quarter of '24. Excluding FX, adjusted general and administrative costs grew 3%.

Slide 14 details capital management and our guidance. On our cash position and our capital return policy. We ended the fourth quarter in a strong position with approximately $2.1 billion in cash and cash equivalents and free cash flow exceeding $1 billion for the year. We delivered strong free cash flow growth of approximately 32% year-over-year or 22% excluding a timing benefit related to the deferral of certain 2025 tax payments into the first quarter of 2026. We also held approximately $1.6 billion of Canton coins with a fair value of approximately $243 million, which is recorded on our balance sheet under digital assets and other investments at fair value.

With this quarter's earnings, the Board declared a quarterly dividend of $0.14 per Class A and Class B shares, up 17% year-over-year. During the quarter, as part of our 2022 share repurchase program, we repurchased approximately 990,000 shares for $106 million. Additionally, we have repurchased approximately 483,000 shares for approximately $51 million in January. There is currently $23 million remaining to be purchased under the 2022 share repurchase program. Finally, this morning, the Board of Directors approved the 2026 share repurchase program, which authorizes the repurchase of up to $500 million of the company's Class A common stock once the remaining authorization under the '22 share repurchase program is exhausted.

Turning to guidance for 2026. We will continue to invest in the business in 2026 and are expecting adjusted expenses to range between $1.1 billion and $1.16 billion. The midpoint of this range would represent an approximate 11% increase year-over-year, relatively in line with our average expense growth since 2016. We believe we can drive adjusted EBITDA and operating margin expansion compared to 2025 at either end of this range. Although we expect the incremental margin expansion to be more muted as overall margins are higher and we continue to focus on balancing margin expansion with investing for the future.

Specifically, we continue to invest in credit, rates, international markets, ICD and digital assets as key focus areas with a long runway for growth. We also continue to invest in technology that allows us to sustain and build on our leading platform. Some of these investments will take time to scale, but we continue to price innovation in creating durable long-term growth opportunities. Within adjusted non-comp expenses, we expect our quarterly tech and communications expenses to grow in the mid- to high teens over our fourth quarter run rate as we continue to invest in our data strategy and infrastructure to support the growth of our platform and new product initiatives.

We expect annual G&A expenses to be impacted by continued FX losses, primarily impacting the first half of 2026, given current FX rates. We expect the first quarter of 2026 professional fees to step down sequentially by approximately $2 million from the fourth quarter of 2025 related to the previously mentioned episodic expenses. We expect annual occupancy expenses to increase approximately 35% year-over-year, primarily due to the full year effect of our New York City headquarters and the overall expansion of our geographic footprint.

For the first quarter of 2026, we expect net interest income of approximately $15 million, which reflects the current interest rate environment and a seasonally lower cash balance, driven by annual bonus payments and the expected purchase of approximately $70 million of transferable tax credits in Q1 '26. For modeling purposes, we view the first quarter of 2026 as a good starting point for the rest of the year.

For forecasting purposes, our assumed non-GAAP tax rate ranges from 23.5% to 24.5% for the year. We expect CapEx and capitalized software development to range between $107 million and $117 million. The midpoint of our CapEx guidance implies a roughly 9% year-over-year increase. We estimate that approximately 60% of the total spend will be on software development to support our growth initiatives and approximately 40% will be related to growth and maintenance CapEx.

Acquisition and Refinitiv Transaction-related D&A, which we adjust out due to the increase associated with pushdown accounting, is expected to be $160 million in 2026. Lastly, we expect 2026 revenue generated under the master data agreement with LSEG to be approximately $105 million, spread evenly throughout the 4 quarters.

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

Thanks, Sara. Looking toward 2026, we see a constructive market environment taking shape. Even with lower volatility, issuance activity remains strong across governments, corporates and increasingly AI-driven infrastructure investment, supporting relative value trading and hedging flows across markets. Alongside the current regulatory backdrop, coupled with growing cross-border activity, these dynamics play directly to our strengths. With a global multi-asset platform and deep client connectivity, we're well positioned to support the next phase of market structure evolution and to continue delivering scalable, resilient workflow solutions for our clients.

On that note, we reported record volumes and revenues in January, which translated into total revenue growth of 17% year-over-year. Recall January 2025 had 1 extra trading day and also benefited from an $8 million boost in market data tied to the delivery of data sets to LSEG. The revenue recognition of these data sets in 2026 will shift to $2 million being recognized in the first month of every quarter. Adjusting for these two factors, average daily revenue growth was 26% year-over-year, showcasing how our sophisticated clients and dealers continue to be very active across our global markets.

I would like to conclude my remarks by thanking our clients for their business and partnership in the quarter. I want to thank my colleagues for their efforts that contributed to the record quarterly and annual revenues and volumes at Tradeweb.

With that, I will turn it back to Ashley for your questions.

Thanks, Billy. As a reminder, please limit yourself to one question only. Feel free to hop back in the queue and ask additional questions at the end. Q&A will end at 10:30 a.m. Eastern Time. Operator, you can now take our first question. .

[Operator Instructions] The first question today comes from the line of Patrick Moley of Piper Sandler.

So Billy, I was hoping you could elaborate a little bit on your comments there. You made at the end of your prepared remarks on the outlook for the market in 2026. What are some of the major themes that you're focused on this year? And then also, I think the 17% year-over-year revenue growth in January was a lot better than people were expecting. So any color you could give on what drove the strength there would be much appreciated.

Absolutely, Patrick. Thanks for the question. We're working hard. So appreciate your voice on this. It's a really good setup for our business. And maybe for a quick second, Patrick, like let me give a moment of context like even over the last like kind of like 5, 6 years, we've gone from kind of 0 rate, 0 inflation market to this kind of post-pandemic world where there was the kind of roof on rates on the back of that like big inflation burst to kind of where we are now which is around this kind of what feels like this kind of general rate framework. Like we're in the 4% on 10-year notes, right? What we have is this -- obviously, it's been a conducive Fed, I think the feeling that we have here is that there's more to do. But there still is, I think, something very important, which is like real debate on the timing of it all. And those are good outcomes for us. And if you take a little bit of a step back from there, debt markets are growing, right? And we have this very active kind of primary activity issuance world now. Public sector and the private sector need funding, right? So even this past week, as you know well, Oracle issued $25 billion in bonds this week. That leads to rates trading as investors hedge out fixed exposure. I'll make the most obvious point of the day. AI is real, right? The hyperscalers will be selling bonds. And so when you think about the big picture of it for a second, the numbers that are -- that we're talking about, $600 billion of AI infrastructure spend, right? That's going to lead to more rates trading. And those things, from our perspective, are good. As the leading rates trading platform, those are good outcomes for us. And those are the things that we feel good about. So as you know, for example, in January, our global swap platform was up over 40% on revenue, a really strong month for our treasury platform, right? You can see how these things kind of work to our favor. The geopolitical complexity kind of drama whether or not we want to think about like the debasement trade or diversification away from U.S. assets. At a minimum, what we're talking about, obviously, is central bank policy divergence.

From our perspective, what's that going to do? It's going to spur more cross-border trading, more global activity. And we have, as you know well, a global enterprise, and our international business is exceptionally strong. So in January, we saw exceptionally good results from our European swaps business, European government bonds. Very strong numbers coming out of European credit. The revenues there were up 40%. Big news obviously happening this month in Japan, our JGB revenues were up 30% in January.

So the international business that we bring to the table that we've worked very hard on building, I think, is an advantage for us kind of going forward. Getting very just quickly into a version of kind of what's happening with equities. It doesn't take a big leap to understand that perhaps like the index is full, we could be looking at a world where there's more kind of drawdowns there. It's going to be about kind of allocating resource into kind of more sector exposure, more country exposure. Those kinds of thoughts and that kind of theme, I think, plays extremely well to the EGF business that we've worked very hard here on building. And so our global ETF revenues were up 40% in January.

So these are like good outcomes for us a good setup. And then I think as we think about maybe one of the more important components to kind of how we're thinking about '26, sometimes things are kind of in our control and sometimes things can be a little bit out of our control. As you know well, there's this concept, obviously, that I think is really important just around the deregulation of the banks and the way that ultimately that's going to and has led to these extremely strong kind of trading operations coming out of how we think about the legacy banks. But really from our perspective, kind of like the partner banks for us. And so I kind of say this with a little bit of humor like the swag is back for these firms and the numbers kind of prove it. And from my perspective and from Tradeweb's perspective, these are great outcomes for us. These are, in a lot of ways, 25-year relationships that we've had with firms like Goldman and firms like Morgan Stanley, JPMorgan and Citi. And so as risk taking kind of is back in vogue, and the profitability of the business for these partners of ours is extremely high level, I think the quote that I looked at was between Goldman, Morgan Stanley, JPMorgan and Citi in FICC in 2025, they made over $55 billion, right? As a trusted partner in the markets with those kind of firms, it's an incredibly good outcome for us to see the profitability of those businesses. And so that's an important thing as we think about the outcome and the setup for '26.

And then the other thing I would just say is like this concept of risk event is always going to be a part of our world. And it's pretty interesting. If you think about just the way the market kind of tended to shrug off some real risk events in kind of December and January, as you know, the 10-year kind of stayed between like 4.1 and 4.2, around some pretty big headline news, whether or not that was like the Justice Department, with actions against Powell or military action in Iran, these are pretty big headlines. I think there's a thought process sometimes that the market has the ability to only price in what's right in front of it. There are moments from our perspective where that kind of ends. And so the concept of living with exogenous risk is a part of the cadence of how markets develop. And so the last piece of kind of secret sauce around how we think things will develop is ultimately going to be the return of good risk orientation into our world. And so I step back and I say a very good rates framework for activity going forward, kind of green light there; continued cross-border global activity, green light there; diversified equities exposure, green light there; and then a business environment that's keyed positively in the marketplaces off of deregulation.

And I don't love to kind of root for obviously exogenous events, but we know that risk comes back into the system, and that's part of the cadence of our world. So I take these things and I add them up. And I think the reality is that we form a strong picture for our business. And so I'm pumped. I'm excited for what's in store for the markets. I'm excited about Tradeweb's leadership role around all the things I just described. And we're looking forward to a really good '26 on the heels of a very strong January and obviously, very early stage, but a really strong start to February. So it's a good outcome for us and a good marketplace. And thanks for the question.

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

We had a question on AI. And we know automation is a key component of your AiEX Solution. But as you take a step back and look across the entire Tradeweb platform, can you talk about your utilization of AI? And also differentiate between both generative AI and predictive AI models?

Absolutely. And great question. I'll make you kind of left for a quick second. As a kind of ex English major. It's always like a pinch-me moment on our earnings call to kind of have a conversation about AI, so it's kind of really fun for me. But my view and the company's view is always going to be shaped. I think, ultimately, by pragmatism, you expect us to be and we will be always kind of commercially focused. We think about AI and how it's tightly linked truthfully to how we make money. And it's always, from my perspective, very specifically a bit about this kind of transition from how we think about efficiency gains to ultimately the most important thing, which I think is like effectiveness gains. And ultimately, what is that kind of client impact engine kind of thing. And those are really kind of important thoughts.

And so as you know very well, we have this very deep high-quality real-time market data. From my perspective, that's the real strength of Tradeweb. Our proprietary data comes from running and operating kind of markets, first and foremost. And so we see extensive executable pricing, RFQ response behavior execution outcomes. And client decision-making across protocols and asset classes as key to all of this. We've always been built around providing ultimately more efficient workflow tools for our clients. And I think we would say clearly that AI is a natural extension of that. And so we -- as an English major, again, with pride, I'll say, we really employ a very deep bench now of the strongest kind of data scientists, the strongest mines inside of Tradeweb.

And one of the things that we, I think, have done well, and Sara and I talk about this a lot, is the collaboration between those mines and our business. And they sit directly with our product team and working on helping ultimately deliver better analytics and smarter tools. And these are really important kind of behavior patterns, I think, for companies to do those kinds of integrations. And so on the predictive AI side, I would say we are kind of looking at our proprietary data sets to help unlock what we describe as like the next frontier of electronification, something we find particularly valuable across how we would describe less liquid markets and larger notional trades. So that's a focus for us where pricing signals tend to be the weakest. And that's a kind of big area of focus. And so I'll go back a little bit as we're talking about kind of AI or how we think about like super intelligence.

I make a point all the time, which is all intelligence is really ultimately about learning. And as a company, you have to be kind of continuously on this kind of learning journey, this journey about learning and getting better. And so one of the things I know that Sara and I talk about and our ExCom talks about a lot, is the ability to keep learning. I think you have to be willing to make mistakes, you have to be willing to push things into new outcomes. And that's the mindset ultimately that a company needs to continue to move forward on this amazing new path around learning. We can all get smarter. And I'm very excited for Tradeweb to play a very strong leadership role around how AI continues to be applied into the financial markets, and thanks a lot.

And the next question is coming from the line of Alexander Blostein of Goldman Sachs.

Sara, one for you. I was hoping you can talk us through how you're thinking about the interplay between Tradeweb sort of annual expense growth trajectory and margins, so just taking the guidance you provided this morning. Obviously, the revenue backdrop started off really well this year. But as you sort of think about the goal for operating leverage for 2026, is that still the case if revenue moderates and if it does moderate, maybe talk a little bit about the flex you have in the expenses in order to still drive positive operating leverage.

Alex, it's a great question. I think when we talk about operating leverage and margins expenses, I think it's actually a really important reminder in terms of what's our top priority. And our top priority is investing for revenue growth through various cycles. And so when you think about that, the way we've designed our expense base is to support that and to deliver and be able to deliver positive operating leverage across all these different revenue environments and through the cycles.

And so like what does that really mean? That means when you think about our expense base, roughly 55%, so a little bit more than half is fixed. And the remainder is about 45%, a meaningful portion are variable or discretionary. So variable being things like automatically rightsized with revenues commissions, performance-driven compensation, exchange fees. Discretionary being things more like marketing T&E, the pace of hiring, planter, things that are within our control. And that balance allows us to maintain operating leverage through different environments. And we can do things in both directions. We can accelerate the pace of spend and we can decelerate the pace of spend. We can do that with the flexibility while still protecting which I think is really that first priority, investment strategies that are often multiyear that drive long-term revenue growth through the cycle.

And so obviously, as the size of the company has scaled and as our revenues have scaled, there's also natural operating leverage that falls to the bottom line. Billy talked about being pragmatic earlier. I would say all of this is great. Flexibility is great as a theoretical point. But the reality is, I think we've already demonstrated our willingness and ability to execute on that flexibility. So if you think back and you got to think back a little bit, but if you think back to the first half of 2023, the environment was such that the top line revenue for Tradeweb grew about 5%. And even in that environment, we paced expenses and we're able to deliver positive margins. So 43 basis points of margin expansion for EBITDA.

Contrast that with just a year later in 2024, you'll remember the top line grew 29%. We were able to accelerate our investments in expenses significantly, and therefore, margin expansion was around 90 basis points. Last year, same thing. You had a really different environment in the first half of the year and the second half of the year. So I think we've proven our ability and flexibility. But most importantly, like our strategic lens is on continuing to invest, continuing to innovate and having that flexibility to do it when our clients need it, which means doing it through the cycles. But thanks for the question. Hopefully, that helps.

And our next question is coming from the line of Ken Worthington of JPMorgan.

My question is on mortgage. So Tradeweb's mortgage business was one of its slower growing businesses in 4Q '25. As one of Tradeweb's most dominant legacy and most electronic markets, how do you think about the outlook for mortgage trading in 2026, particularly primary and refi activity rebounds? And then maybe as a second part to this, are the innovations that we're seeing at firms like ICE and others in mortgage tech, are these innovations possibly going to have an impact -- positive impact on your business over time? What are you sort of thinking there?

Ken, I feel like you almost complemented and in sold it off at the same time with that very excellent question. And it's always great to hear your voice. I mean, you've known us for a while. And obviously, you know me as a CEO, but to make you for a quick second, I'm also a father, too. And so you also, I think, understand very well like that expression that all of us parents have which is kind of like all of our children are equally smart, all of our children are the most beautiful. We love all our children the same. All of our children or favorite children. I think there's a possibility that like the mortgage business might be my actual favorite child, which haven't told anyone that yet until we write the second. Because in a lot of ways, it kind of represents some of the best things about the company for a long time. It's the most electronic market that we have. It's the market that we have the highest market share in. It's the first market that were in to have what I would describe to you as something like very important, which is like real risk flow. We talk about risk like all of the time, the lease of risk and credit. The mortgage market, I think, for a bunch of reasons, one of which was kind of like the ethos of kind of how mortgage bankers kind of dealt in the market was always very comfortable trading real risk electronically in comp. And those are the kinds of characteristics that play very well to electronified marketplaces. And then it was the first market that we were in that actually we wound up kind of expanding into wholesale. So it was the starting point for us to ultimately move into the wholesale side of the market and build out these really important near kind of liquidity pool. So it's got the kind of the favorite childness around all of those things. But the reality is, which you framed properly is that, that market can go sleepy at times. It could be a sleepy market depending on where rates are. And then when it wakes up, it can wind up being one of the sort of 2 or 3 most important kind of coupons ultimately in global markets. So there's very big different levels of activity depending on where we are in the rate cycle.

I think the reality is we are kind of out of sleepy zone. We have primary issuance increasing. We have actively managing kind of pipeline risk adjustments around duration and convexity exposure kind of happening. And so the market is without question kind of coming to life. We also, as you know, I think, had pretty big headlines in January with the GSE commentary coming out of the administration. The administration wants lower mortgage rates, and they tend to get sometimes what they want. And so there was a material pickup in activity in January. Our revenues were up 15%. I think the outlook for that business is quite strong, particularly if we break lower on rates. And I think the future of it is going to have ultimately, I think, and very importantly, a larger group of players as participants. If you really think about it is kind of interesting. The systematic players that are very strong companies, as you know, Ken, very well in adjacent marketplaces like government bonds have largely, I think, because of the cycles that the business goes through have largely stayed out of the mortgage market. But we see those types of companies ultimately coming into that market. And from our perspective, I think that kind of pushes things towards a more velocity-driven marketplace, which is good for business.

I follow pretty closely things that Jeff does on the mortgage servicing side. I think he's been kind of right on his thesis all along. Tough to time it. I would say. But ultimately, as he makes origination and he makes the servicing aspect of the marketplace more efficient, those become good aspects of secondary trading, and we feel like we'll ultimately also be ironically the beneficiary of that as well. So in an interesting way, kind of rooting for him on the efficiency play that he's been working on, and we think directionally, he's been right in terms of that area of the business needing a step-up in technology. But I appreciate the question, and thanks very much, Ken.

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

Billy, I saw you on a panel on tokenization a few weeks back. It sounds like you're doing a lot on that topic, a lot of initiatives. So maybe today, can you talk a little bit more specifically what you're doing and maybe some of the timing of those initiatives that you're going right now? Also, since -- I'm sure there's a lot going on, where do you actually see the biggest revenue opportunities coming out of this? And then on the other side of the coin, because I need to ask, since you're kind of pretty critical connecting buy and sell side today as those underlying markets potentially change here and get digitized or tokenized, how do you ensure that you're not going to get disintermediated as people may be looking for new rails, et cetera?

Yes. All good questions, Alex. Appreciate it very much. As I'm sure you heard me kind of on the panel confusing everyone. Let me -- just for a quick second, I'm going to actually kick this to Sara, who's been spending a ton of time on this. And I'm really looking forward to kind of hearing you, Sara, kind of describe this like perfectly. So you take it.

I'll start just kind of where you left off, which is a little bit of a big picture and how do we think about this intermediation. On tokenization, we don't really view it as disintermeding what we do. We think of it as an infrastructure upgrade. It's not replacing market structure, and in particular doesn't really impact price discovery. So as we see things evolve, we think people still need platforms that connect buyers and sellers. They need to be supported in terms of price discovery, they need to manage that risk transfer. And importantly, deeply integrate into institutional workflows which are things that we think we are still well positioned to do given how long we've been investing in this space. And can do it, whether it be traditional rails or on these digitized more modern rails.

What we do see tokenization impacting are things like settlement and collateral mobility. And I know, Billy, you talked about this on the panel, which we think frees up capital increases velocity of trading over time. We've talked about potential for 24/7 trading before. All positives from our seat in terms of the big picture. More specific to us and Billy and I and Chris Bruner here have been spending a lot of time on this. We've been at this for a while. So for the last 3 years, and I would add with my CFO hat on, in a remarkably capital-efficient way, we've built out a leadership position whether it be digital assets, blockchain networks or tokenization. And today, I'll give you one specific example, we feel like we are positioned to be the premier venue for tokenized trading for U.S. treasuries. We've talked about this, I think, on other earnings calls, we've completed multiple rounds of fully unchain repo trades, utilizing tokenized treasuries as collateral and versus stable coins with the notion of expanding for other forms of collateral like digital cash. So that's already been in the works since the third quarter of last year.

More recently, which I think is interesting in a little bit to your timing point, we think we're sitting in a unique position during what you would argue might be a milestone year. The SEC delivered a no action letter to DTCC this December. And Tradeweb is positioned as the non-equity venue really leading the charge for their pilot program were trillions of assets that sit at DTCC will now be tokenized on an opt-in basis from their clients. And so if you think about what that means, that program can launch at the second half of this year, that opens up a real opportunity, and we think tokenized treasuries, given what we've already put into the market, will be a place to start. And from there, we'll grow.

I don't think anything changes overnight. Billy and I talk about that. We think clients, as we know better than anyone, take time to change. We do see interest. But I think the reality is the tokenized rails, digitization and blockchain will operate side by side with a lot of traditional rails in the marketplace. And we think we can bridge that quite well for clients. And as a result, I think from a revenue opportunity, it's early to say exactly how it plays out, but we see opportunities to drive revenue in our traditional trading business, as a result. As well as new opportunities given our leadership position on some of these networks, developing apps and bringing other market participants given our institutional and dealer network onto some of these digitized rails. But...

I think that's spot on, Sara. And then for a quick second, Alex, kind of like almost like tying your question a little bit in an interesting way back to kind of what Ken was asking about. Like if you just think about for one second, just about the concept of obviously, the guardrails of collateral management and ultimately, problem-solving around kind of settlement. I was talking about my favorite child before the mortgage market, which has in a lot of ways within the fixed income complex, the most onerous settlement cycle. And I think that settlement cycle in a lot of ways is one of the reasons why there are the types of entities that have been performing exceptionally well in other markets have tended to either stay away from or have a lower impact in that market. And for sure, as we see the continued advancement of blockchain, and we've talked a lot about our partnership with Canton. As we see that continued advancement there, we've identified the mortgage market as one of those businesses where, from our perspective, a great commercial outcome would be onboarding more participants, and we see a streamlined settlement process as a very important outcome there. So that's an area of focus and attention for us that has a good commercial outcome. And good to hear your voice.

And the next question will be coming from the line of Tyler Mulier of William Blair.

I'm on for Jeff Schmidt. We had one question on share buybacks, given the strength in the quarter in January, a new authorization. So there's stock down a fair amount over the last 6 months. I think it's now trading your near the lowest PE since going public. Is there a potential for you to increase your buybacks at all?

Thanks, Jeff. We're definitely giving more thoughts to buybacks. I think you've heard us talk about our positioning in view of the forward market and the macro environment and our business performance, not only in January, but that momentum continuing in February. So we remain confident in what we can drive and deliver. And we do think that you've seen the stock dislocate from some of those fundamentals. You've already seen us, and I think you're aware of this, you've already seen us be more aggressive. So in the fourth quarter and through January, we've repurchased about $150 million of stock and the Board authorized an additional $500 million plan. So we think we have the flexibility to continue to do it. I think from our seat it's one piece of our capital allocation framework. So it's one that we definitely have in our arsenal. But we also feel quite strongly that we have a lot of opportunity to grow the business organically. We have the opportunity to pursue inorganic investments and M&A. And obviously, share repurchases, particularly when the stock as from what we think is our fundamental growth opportunity, we'll use that tool as well.

And the next question will be coming from the line of Simon Clinch of Rothschild.

Billy, I was wondering if you could characterize the competitive environment in credit today. This is clearly a focus of the investment community, particularly given to have the market share data out there over time. So what do you see as the biggest catalyst for improvement in share or trade war tenors from this point? And how that sort of competitive dynamic shapes up over the next 1 year to 5 years?

Yes. Good question. And I would agree completely. It's competitive. And I would agree completely with you that it's a focus of the analyst world and the investor. I wouldn't go so far as to say it's an obsession, but it's a focus for sure. And I would start by saying just as a reiteration, like we feel very, very comfortable competing. Its part of who we are. We've been competing day 1 as we built this company over 25, 27 years with Bloomberg. The competitive framework is something that's comfortable to us. I think the path forward on continuing to grow revenue and grow share is going to be pretty straightforward. You have to be onside with the banks. I described that before when I was talking about the going forward to '26. If you're on the wrong side with the banks as this next leg of evolution occurs in credit, you're on the wrong side. And we think our relationships with the banks is a game changer for us there. You have to continue to be able to link markets. And so again, we feel like our footprint in treasuries is kind of important there.

Obviously, the cross-asset piece of how we approach the market, I think, is important. Data, pre-trade data, the ability to present clients with the best data, I think, is, again, very important principles for us to keep in mind. And then ultimately, I'm going to get into kind of the two things that we feel very strongly about, which is solving for risk and solving for what we would describe to you as banks' inventories and banks' trading access. And to make an obvious point, if you don't do the first three things I described at the highest level, which is partnership, the ability to bring in other marketplaces and ultimately have the best data that you cannot solve for ultimately what is risk trading and what is complexity. And so month-to-month, quarter-to-quarter, we are focused on the credit business. We grew revenues, as you know, quite well in the month of January. So we're feeling good directionally about how we're positioned there. It is an enormous focus for me and for the company to continue in a competitive environment to be best-in-class there, and that's the mandate for us as a company. And appreciate it. Good question.

And our next question is coming from the line of Bill Katz of TD Cowen.

It's Bradley Hayes on for Bill Katz. Following up on tokenization, as assets increasingly become tokenized, how are you thinking about the impact for the swaps market? In particular, is there risk to volume from a contract functionality?

Sure. Why don't I jump in with that. I think similar to how we talked about tokenization, smart contracts really takes away the friction in the swaps market potentially that sits downstream past execution in terms of the value chain that we're in. So it really stream affirmation, confirmations, clearing that post-trade life cycle management, which we think is really helpful and only further electronification and the trading velocities in the space. But from our seat, it doesn't disintermediate or really impact the value that we are offering in terms of our markets.

Thank you. And at this time, I would like to go ahead and turn the call back over to Billy Hult, CEO, for closing remarks. Please go ahead.

Great. I know Sara and I both appreciate a very busy day for everyone on the call. Appreciate your time. Thank you all very much for joining us. Any follow-up questions, obviously, please feel free to reach out to, Ashley Samir and our great team. Everyone, have a great day. Thanks very much.

Thank you all for attending today's program. You may now disconnect.

Alright, well, good morning everybody. Thank you for joining us for the next session. It's my pleasure to introduce Billy Hult, Tradeweb's CEO. Tradeweb, as many of you know, is one of the largest and most diversified operators of electronic markets around the world.

Over the course of 2025, Tradeweb delivered record results across many of its products, supporting industry-leading earnings growth. Over the next 30 minutes, we'll spend some time with Billy on the future of fixed income electronic markets, how he thinks about Tradeweb's growth opportunities in the year ahead and just how the market structure is evolving broadly, lots to talk about. Thank you so much for being here. Always great to see you.

Absolutely.

Why don't we start with a question on a bit of a forward given just the time of the year. As I mentioned, Tradeweb is wrapping up another really strong year, nearly high teens kind of earnings per share growth, mostly driven by revenues, of course, which is super important. Despite what's been pretty tough comps year-over-year for you guys. So as you think about the trading comps still being relatively tough this year into '26, what are kind of some of the bigger kind of top line organic drivers you're leaning into '26 that will hopefully sustain this level up?

Absolutely, Alex. Great to see you. Usually, we kind of twin with our Oura rings. I gave mine up.

I switched. Did you see that? Yes, I'm done.

Since I've gone blind, now we can kind of twin with eyeglasses. We will have an eyeglass contest. I've been doing this now with you, I think, 4 years I've been -- as everyone in here kind of knows, CEO of Tradeweb now, this is the end of my third year. Really strong growth over the last 3 years.

I kind of think about sort of 11% growth in my first year as CEO, 29% growth 2 years ago. To your point, we're going to be up around kind of 17%, 18%. I kind of think about like what's that environment been like? First thing my brain goes to is the obvious, Alex, you and I talk about this a lot, like debt markets continue to grow. One of the most important kind of concepts is obviously, like the central banks have been kind of quieter in the spaces that as buyers in the space -- spaces that Tradeweb kind of lives and breathes in. Those tend to be a very good environment for our business.

And then plus this kind of concept of like private sector intermediation being really back in vogue. I think those are 3 really strong principles. And then as I kind of described that kind of growth, I would say, in a very interesting way, obviously, like very different over a 3-year period, kind of rate regimes. We went from that kind of concept of like the big rate hikes, then not higher for longer. And now we're obviously like at a different moment in time now.

I continue to be obviously extremely excited about the forwards of my business. As you know, I tend to be -- I think, in a really good way. I would say, like an internal optimist, I believe in the concept of behavior change all the time. And I feel like we're entering into another very, very good environment for our business, particularly on the macro rate side of the world.

I was at a very interesting dinner last night, 2 of the best kind of economists in the world, an-ex central banker was in the room. And it's like the 3 smartest people I've heard talking about rates and they couldn't agree on like the direction of the next like 6 months. And as I'm hearing that, I'm like well, this is a good time to be in the rates business with that kind of indecision at the highest level around thinking.

So feeling really good about this kind of continued evolution of kind of phone-based business into the electronic world. When I think about kind of the drivers kind of going forward, I would start from our perspective, clearly, with the swaps market, which has been just an incredible business for us, and I see it continuing. I think there's going to be continued micro trading protocols that will continue to pick up traditional voice trades in the swaps market. I've talked a lot about this concept of request for a market that has been a very strong protocol that we launched in Europe. It's still being implemented in the U.S., particularly with the macro hedge fund world. We think that's really good.

I also like the concept of what we're doing really around electronifying noncleared swaps. So we did our first electronic swaps and trade very recently. We think there's continued path there. The international side of our swaps business is still like very early innings. And I would specifically point to areas of the market around Australia and Japan as areas of focus.

And then I would kind of come back home a bit and talk about how kind of Tradeweb has always kind of lives and breathes around different pieces, as you know, Alex, in the market structure from kind of retail to wholesale to institutional -- the institutional side of our business rightly so gets a lot of play. We've always mirrored the concept of wholesale liquidity along with our institutional businesses.

And I have a pretty strong feeling that there is continued opportunity in our swaps business on the wholesale side. As we kind of enter into 2026, the wholesale side of the swaps business, even with all of the regulation that's gone into the market and all of the electronification on the institutional side is still kind of like a sort of like 1996 market, very phone-based, voice-oriented market.

And as these strong players arrive on the institutional side in swaps, I think there's going to be a pretty strong push to kind of unleash the wholesale side of the market and move that into a more electronic direction. So feeling quite good directionally speaking, around how the business is set up into next year and kind of highlighting a component of our international business plus our swaps business there's pretty big areas to feel good about.

Great. Awesome. Well, like why don't we double click into some of this? I did want to spend a little bit more time with you on swaps, just given the fact that's your largest and probably still your fastest-growing business, I think revenues there are up like 35% or something like that year-over-year. So quite substantial.

So you talked about some of the key drivers of volumes from a structural perspective there. Maybe one, double-click into sort of the catalyst, what could drive further acceleration on that wholesale side of the market, like one particularly about client behavior that's is right for this move. And then number two, we talk a lot about volumes, but obviously, fee per million is important. And there's a time that goes into that. So I don't want to spend the next like 30 minutes talking about fee per million and swaps. But help us understand how the macro dynamic with the direction of the yield curve could impact that? And anything notable within mix on that fee per million?

That's always a tricky one. But let me kind of start with maybe like a slightly -- nothing is easy. As you guys know very well, like the swaps market was like historically, like the most back alley of all back alley markets. And Dodd-Frank and regulation kind of changed the arc of that market, took it from a noncleared kind of back alley market, trade on, keep that trade on with a counterparty and take that trade-off for the counterparty, all of those things to make electronification were difficult.

As the institutional market began to go more electronic, the voice market on the wholesale side just kind of stayed quite negotiated. And what I've actually, I think in an interesting way, uncovered through a little bit of kind of old school kind of connecting the dots is as kind of new entrants continue to emerge on the institutional side, firms like Citadel, as a highlight and all of the conversations with them are about how do I increase my market share with different types of clients in the institutional world, we've begun to kind of have, I think, in-depth conversations about the faster the speed limit, the better, the more flow that I can get through the electronic pipes, the better.

This is a big blueprint of our strategy. We need to unclog some of the transactions that occur in the voice world, on the wholesale side to continue with that speed limit going higher on the institutional side. So there's -- becoming this thing, which you've heard me kind of say before this kind of like light bulb moment where there is now, I think, a like-mindedness from the strongest players on the institutional side to really work with, I think, trusted partners on beginning to unleash that market. And I think it's really, really important.

We've seen versions of that happen in the government bond market and then very, very specifically in the TBA mortgage market, which is also a very interesting market. So that's like a good kind of pattern recognition moment for us and an area of focus for me. We're still going to do things, Alex, because you've been always very focused on this around trying to understand our business from a fee per million perspective and compression and all of that.

We're still going to do things where we can, which I described, I think, very clearly as like solving our clients' problems. And as you know, we've always kind of lived and breathed on the client side very comfortably in the asset manager world. That's been a kind of comfort zone for us. But not surprisingly, over the past bunch of years, we've really focused in on the macro world. The macro hedge fund world as being a big driver of volumes going forward. It can be more difficult for clients to, in some ways, interact with. Your going to get like one at that very quickly to solve a problem there. And we kind of view the concept of really solving for kind of compression needs as something important.

And so what we've seen in swaps very specifically as we've solved for compression needs, we've created kind of workflow solutions. We earn the risk trades on the other side of it. And there's been a very strong symmetry from our perspective, kind of around that. And so not to say that I'm a genius, let's do more of that. And so we're always in there with these types of clients that tend to be difficult. They tend to like the phone. How do I make sure I hear my important counterparty at Goldman Sachs' voice?

We're really into kind of solving the immediate problem, and that has been on some level, compression and then earning into risk. So hard to say exactly from a kind of compression perspective into risk, always where that goes. I would say, generally speaking, obviously, lower rate environment, steeper yield curve will be ultimately a good outcome for the fee side of our swaps business.

And we think we're kind of pressing the right buttons there, most importantly in terms of the things that you can control pressing the right buttons on solving for problems and then earning into risk. I've always kind of said very clearly like it's about getting after risk trades, whether or not we're talking about rates or credit and then it's ultimately solving for how we think about complexity and negotiation. Those are the next legs of where we're going with this.

I got you. That makes sense. Before we move on from REITs, I did want to spend maybe a minute or 2 on the cash side of the business, the treasury market, there's a couple of interesting dynamics that have been going on there, right, where you talked about the market share of your platform relative to kind of the observable industry volumes. It appears like it sort of stalled out at around 20% or so.

But underneath the surface, there's obviously a lot of important things going on, one of them being basis risk trading has been done mostly over the phone and therefore, that just kind of creates a bit of a denominator of noise in terms of how what you get market share. So how do you think about, one, trade of as opportunity to break into that part of the market whether or not it's in the TAM or not? And just talk to us about the sort of the organic and things like that.

It's an interesting question as I think the room knows well, government bonds like the first market that we were in like way back when. So it's like it's about as home court of a business that we could have. And so as you know, because I think you were the one that acted like as we were getting kind of questions on our last earnings call about like what's going on with your treasury market shares, the guys were like, this is our home court. What are we doing here?

And I think it takes a moment for us to be very, very specific that in the past, and I'll say this like very clearly, there had been kind of moments of stress in the marketplace, moments of extreme volatility, where I would have described to the room where kind of traditional electronic business would kind of recede into a reversion into kind of phone-based business. I can't see the right prices on a screen. Let me pick up the phone and call in a kind of relationship trade. And this is kind of like the practical realities of our business.

I think as we navigated through kind of a very stressful obvious marketplace in that kind of January, February, kind of March period of time, specifically around tariffs on, tariffs off, et cetera. We saw the opposite. And I want to be very clear about that. We saw a real, real stickiness of traditional electronic behavior, specifically speaking through a bunch of innovations that we've launched into the market, specifically around kind of smart searches for liquidity.

That's a really important comment. But what we also saw was areas of the market where we had begun to make inroads specifically speaking to your point around kind of pieces of the base -- of the treasury basis trade which is still traditionally dominated by voice behavior, big risk trades, let me make sure I'm actually hearing the right guys' voice kind of activity that the volumes in that market really spiked.

And as you know, because we've talked about kind of acquisitions that we've done, 1 of which is an acquisition that we bought called r8fin, which is an algorithmic platform that kind of lives around that space. We've identified that before that as an area of focus for us. We were just probably like in some ways, like 6 months behind being perfectly on the screws there.

But as you know, I'm ambitious, and I kind of run the company in an ambitious way. So huge areas of focus. All the time for us in a home court market to really get after that kind of business because we feel that's fundamentally important with, in some ways, the biggest and most sophisticated players driving the volume. So that's a big area of focus, and I think you kind of framed it perfectly.

Got it. Okay. So why don't we spend the next several minutes on the credit business, it's your second largest business, starting with the bulk of it, which is U.S. IG and U.S. high yield. The market share for you guys, and frankly, for your largest peer as well have been kind of range-bound this year for them that have been range-bound longer than that, which is naturally back to the question, and I was like, how are we kind of done -- like have we kind of reached the ceiling in terms of what's truly electronifiable in the U.S. credit space.

So one, curious to get your thoughts on that. And two, if the answer is no, there's more to go, which I'm sure that's what's going to be the answer. What are you guys are doing to sort of reaccelerate reinvigorate growth for Tradeweb in this part of the market?

Yes, it's a good question. Definitely a lot more to do. So a lot more room there, and I would have a long history around obviously kind of driving behavior change and driving kind of paper markets into electronic markets and credits are an extremely fun business for us to be in. And I think we've done over a period of time exceptionally well there. So I really would kind of not read too much into a moment in time, particularly when there's a competitive element to it.

That being said, the company has more work to do to get after that next level of growth. And I see that next level of growth really coming kind of in 2 different ways. First, I would say, Alex, as you know, a lot of the cadence that is done around these electronic platforms in general tends to be done around the buy side being proactive and ultimately, the dealers, their counterparties reacting to flow.

That is a very fundamentally important part of the market, but it's only part of the cadence. The other part of the cadence that I find to be extremely important, which I think very clearly is going to be fundamentally important to getting that next level of growth is the dealers being much more proactive electronically in the space, both in terms of straightforward dealer RFQs, but then I would say underneath that, something equally important, which is access and inventory. And access and inventory are important.

They tend to be kind of real trading opportunities that have historically gone through kind of sales forces, how do I get something very valuable to me to my most important client or clients at the right price at the right moment. Interesting kind of problem to solve for. It's a big piece of the cadence of the market that has been under electronified. Feel very strongly that Tradeweb, as we've kind of really kind of run with that, as you know, like almost like the balance in the market. I say this like all the time, like BlackRock and PIMCO are very important clients to Tradeweb. They're not more informing clients to trade with than they are with Goldman Sachs or JPMorgan.

So understand your role in the kind of ecosystem where the electronic interface between 2 important entities. And I think we've run our platform truthfully with that kind of humility around understanding these are extremely important trading relationships. And as we built things like portfolio trading, which has brought the banks back into the equation as real market makers, we've done that deliberately. And I think that puts us in a good position as the kind of industry problem solver around this next leg of flow, dealers being proactive around inventory and access, very, very important thing.

Other thing I would say is just around next level of growth. The credit market like missed a stop. And when I say that, it's kind of gone in like 2 directions. It's gone. And as you know, the sort of like all trade direction or market access calls at Open Trading, which is like big anonymous giant nets of where do I find liquidity out there kind of in the universe because liquidity is hard to find.

And it's also gone into something very interesting, obviously, which is like portfolio trading, which is a very tight net, more complexity and bringing the banks back into the equation. So it's gone like way over here. And then in some ways, way over here, what it has kind of missed so far is almost the out of central casting kind of traditional RFQ to view.

And so ultimately, how do I start getting more comfortable around risk trades and sending them into 2 or 3 dealers have a significant amount of comfort that the information is going to be shared correctly and the dealers are going to respond back with the kind of levels where I can transact on. We've seen so much signs of progress in the market, particularly with the firm like Citadel kind of accelerating into credit and then therefore, keeping in a good way, the Goldmans and the JPs and the cities on their toes that our feeling is the market is going to find this kind of sweet spot of maybe the stop they should have hit a bunch of years ago, which is like this traditional almost like traditional RFQ business.

And so I think we sit well around solving this next level of growth but fully understand, it's been a difficult year. We made so much progress kind of early. And now we see, as everybody kind of knows the behavior change comes in spurts. And that there's a patience that I would kind of describe around that, that you need.

The way you framed it, if I were to paraphrase a little bit, it feels like there is almost really increasing protocol convergence because you guys were early and incredible in portfolio trading, same thing, I would say, in sessions. And now you're kind of coming after the RFQ world the opposite is happening at some of your other competitors, which naturally begs the question about price. I mean, that's probably one of the more critical questions on top of investors' minds like aren't we going to be at a point where pricing compression will start to accelerate across this whole ecosystem. How do you think about that? How do you defend your product?

Yes, it's a really good question. So let me see if I can describe it. The way -- because I mentioned something which is like the importance of kind of understanding where you are in the totem pole and understanding these really, really seismic relationships with BlackRock, PIMCO into a Goldman, JP, that's like kind of grown up transaction world.

And when you preserve that relationship after it has been disintermediated on some level, you've created a lot of value. And we've all kind of seen how the banks have, in some ways, kind of benefited from kind of coming back into the market as real counterparties, again, to their clients when it had kind of slipped away from them in some ways when you think about that concept of open trading and the disintermediation around that.

And so one of my responsibilities, as you can imagine, is to make sure I am constantly ringing the bell on that value that has been created. That being said, and again, I kind of -- I say this with the bluntness that you know, court awareness around fees and the reality of this is something very, very important. So what we've worked on with the team is getting them to understand like, again, back to the totem pole, like where is the value of what we're creating.

I would say from my perspective, I've been more amenable to understand that there should be -- if not few really understanding around the wholesale side of the business, which is ultimately in a lot of ways, less valuable business to our clients and be very, very strong around wallet preservation in an area of the world where we've created significant value to the community.

And that's an important, I think, distinction that needs to be understood and heard. And again, as we kind of continue to do things around creating these efficiencies and the value around access and inventories and figuring out the cadence between those things and those instruments and the most important clients. My optimism in a lot of ways relies on the fact that understanding that's valuable stuff.

You're into real pieces of the trading community. We're not talking about kind of nuisance oriented business that kind of collides out there in the air. And so it's important to think about that. I was -- in the conversations, Alex, that I have, especially with the buy side, it's like keep investing, keep solving problems. And that's an important principle. Like it's not -- hey, let me talk to you about where we are with the kind of few models.

Yes, I mean, it drives efficiency through the -- at the end of the day, which is how you guys approach this. So there's a lot of focus on U.S. credit, but you guys have, I think, in a really interesting story outside the U.S. as well, predominantly related to merger market credit.

I think it's been an important area of growth focus for you as well. Maybe spend a couple of minutes on how you view the penetration of electronic venues and emerging market credit. What sort of role do you guys play? What are your goals there? What gives you the right to win that kind of stuff?

We've done really, really well in the EM region like in general, that's been a big, big push for us. Not surprisingly, we kind of started off like sweet spot there, which was like our rates world. EM swaps has been a big driver us there. That's allowed us to make, I think, the right version of penetration into credit so far, very, very early innings there for us.

I think we still have to keep building out really strong sales engagement in that world and then beginning to see a lot of pickup in kind of like the go-to protocols that we've lived in, which I would start by saying kind of portfolio trading, that's beginning to become a kind of leading-edge driver for us around early successes that we're having.

In EM Credit plus, I think probably as importantly, the concept of what we had early on as a strength, which was bringing in kind of the rates market into products that trade on spread is also a differentiator for us in the EM region. So when we think about our international business, Alex, and how well our international business quite honestly, has done I would say, kind of like focus #1 inside of that is continued acceleration in EM credit very specifically. And we think there's the same kinds of openings in that area of the world that were our original openings in the U.S. in credit.

Got it. Okay. We're going to shift gears entirely. Talk about different kind of innovation, which has been kind of all over this conference for the last 2 days, which is tokenization. So prospects of tokenization really kind of accelerated across financial markets. And I think the world is still trying to kind of figure out like what's real, what's not, what's the real use case that adds a lot of value in the near term versus what's kind up high in the sky.

So how are you thinking about that ecosystem across sort of the products that you're active in, what role could Tradeweb play in that? And as part of that, maybe talk a little bit about your partnership with Canton Network, I think it's pretty important.

Yes. It's interesting. I like the way you described it is cool, we're still kind of learning there too. And you do get a lot of different opinions. We do a really interesting kind of once a year real like bringing storm session with BlackRock, and that's obviously like almost like a front and center conversation with them like not to say caution, but where is this going?

A year ago, I got a phone call from Don Wilson at DRW, who we've known for a long time inside of trade. We have big rates client, a lot of activity. They were never like our best client, but huge amounts of respect for him as a practitioner and as an entrepreneur, and he called me up and he said, I think we're really on to something with Canton. I think we have like a strong odds of being the guardrails for collateral management. We kind of need you. You guys are not much like Diplomat, but like you're good at bringing in the ecosystem. You can go see Goldman, and you can see JPMorgan. You can help us kind of broaden out this network.

And I was like, I think he's right a lot. So we're going to take this very seriously, and we're going to continue to learn through our investment with Canton. I am practical, as you know. And I take a half a step back and here's what I would say, which I think is actually like very interesting. We've lived in the rates complex for a long time, and we've done pretty well. We have a very, very strong from my perspective, mortgage platform, TBA mortgage platform, a combination of institutional and wholesale.

As you know, Alex, that's an interesting market. There are moments in time depending on where the rates world is, where it can be like 1 or 2 or 3 steps removed from like the heat spot of fixed income and then there are moments in time where kind of rates are lower when it's like 2 of the 3 most important kind of coupons in the world and that's how that market kind of operates.

It has for kind of origination reasons like very inefficient kind of settlement processes. It has a much more limited amount of participants in that world, considering how important of a market it is. It has almost no what I would describe to you guys as like algorithmic kind of driven execution or activity.

It's got a lot of room to kind of change as a trading platform at a moment in time where perhaps kind of we're heading lower into rates and that market is going to become, again, a kind of front and center business. And when I think about all of that and I think about a market that is really looking for a different kind of settlement structure ultimately settles in 30 days, 60 days, 90 days. This is like -- this is -- we're not talking about going from like T+1 to T+0.

I see a very, very interesting opportunity and a very pragmatic way for a company like Tradeweb, which lives and breeds around that as being a fundamentally important marketplace to play a leadership role around creating a more efficient marketplace and therefore, because we're commercial bringing in much different types of the ecosystem of the players who are big volume-oriented players in adjacent markets. And that's interesting. Like all these years later to see how a market like that has the potential to evolve really, really interesting.

The point you may hear really on the potential to evolve is key here, right? Because nobody actually really knows and there's a lot of people that are believers and there are others that are like, if anybody don't fix it.

I have lived in that. And again, it's a little bit of a more sort of dramatic version of the moment I had yesterday at the dinner where we are like the 3 smartest people in the world on the kind of rate thing, not an agreement about what's going to happen not in like 2 years in like 2 months, right? And this is a -- you got a wide range of views on it, like T+1 to real-time settlement like who cares, right?

As you think about that ecosystem, is this likely to be an organic build for you guys? Or if there's more evidence that this is becoming a more meaningful part, that's something that you might look to do something inorganically as well?

We love the beginning stages of the partnership that we've created with Canton. And those guys, we think that with a healthy dose of respect, we think they're very, very smart and they're on to something, and the way they've been able to attract really important pieces of the ecosystem into their world this year is important. There will be parts of it that we would be very obviously willing to build ourselves, and we will particularly like the execution pieces of it.

But we think we're on to something with the early-stage relationship that we have with Canton. And I feel very comfortable that that's the kind of right bet for us to make at this moment in time, very clearly, Alex, with the understanding of something you said, which is like there is this kind of natural bit of back and forth, plus a natural bit of uncertainty around directionally where it's all going.

It's been interesting, I also say this like to be able to be a part of this, and I think in a meaningful way, and then be able to sort of have the kind of conversations, I think that Tradeweb is known for, which is like brainstorm, idea generation and start to have conversations with the kind of players because we're in this around like where is kind of institutional crypto execution going. And is there a role for Tradeweb to play around that. And some of those doors, the conversational doors have been opened because of how we've partnered and been, I think, opportunistic around the Canton piece of it, which is cool.

All right. For my last question, maybe just bring this a little bit more closer to home here. You guys announced your monthly, I guess, a couple of days ago, for November, really good momentum in rates still. So it doesn't seem like there's a tremendous change from kind of the direction of travel you've been on. I think on the last earnings call, you talked about Q4 revenues trending something in the up 9% range year-over-year for October. Any other thoughts on kind of how Q4 is shaping out.

Only thoughts are like -- you made the point about tough comps fully hear you. October was an interesting month for us because as you know very well, like a little bit of like one hand tied behind our back around the government shutdown. We obviously flourish around payroll events, those are huge, huge volume days for us.

So that was -- no one is going to feel bad for me, but that was like a frustrating kind of moment around that. I feel like when you look at kind of like November of '25 versus November of '24, where people were like vis-a-vis the election and the volatility and the buildup around that. That's like the perfect environment for your business. I feel bad for you, Billy, next year, November of '25. Like I feel like we did extremely well. Sameer gave me the stat around average daily revenue for the month average daily revenue, which doesn't roll off my tongue.

I think it was like 16% or 17%, obviously, 1 less trading day in the month of November. That's like significant growth from my perspective when you're thinking about kind of what last year was like and the challenges that we've had in credit. I speak bluntly the challenges that we've had in credit over the past bunch of months in terms of moving that market share. I think it speaks to the wide range of our platform, and again, the leading edge that we have around the rates world in our macro business.

Yes, great. Well, it's a great note to end it on. Billy, thank you so much. Always great to see you. Thanks for the time.

Thank you.

Good morning, and welcome to Tradeweb's Third Quarter 2025 Earnings Conference Call. As a reminder, today's call is being recorded and will be available for playback.

To begin, I'll turn the call over to Head of Treasury, FP&A and Investor Relations, Ashley Serrao. Please go ahead.

Thank you, and good morning. Joining me today for the call are our CEO, Billy Hult, who will review our business results and key growth initiatives and our CFO, Sara Furber, who will review our financial results.

We intend to use the website as a means of disclosing material, nonpublic information and complying with our disclosure obligations under Regulation FD. I'd like to remind you that certain statements in this presentation and during the Q&A may relate to future events and expectations, and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements related to, among other things, our guidance are forward-looking statements. Actual results may differ materially from these forward-looking statements. Information concerning factors that could cause actual results to differ from forward-looking statements is contained in our earnings release, earnings presentation and periodic reports filed with the SEC.

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

Information regarding market and industry data, including sources, is in our earnings presentation. References to year-to-date results on today's call mean results for the 9 months ended September 30, 2025.

Now let me turn the call over to Billy.

Thanks, Ashley. Good morning, everyone, and thank you for joining our third quarter earnings call. We delivered another strong quarter, surpassing $500 million in quarterly revenues for the third consecutive quarter. Year-to-date revenues as of the third quarter are up 21% or 17% organically, putting us on track for another year of double-digit revenue growth. We believe change is constant. The current macro environment is defined by historically low interest rate volatility, tight credit spreads and muted equity volatility.

At the same time, geopolitical uncertainty and the rapid rise of artificial intelligence continue to reshape how we work and live. We've consistently thrived amid change, and we believe we're well positioned to keep doing so. From the emergence of decentralized finance to shifting regulatory frameworks, we believe our global fixed income platform and network put us in the catbird seat, helping our clients solve their real-world intangible challenges. While the pendulum may be swinging away from globalization, fixed income and ETF markets are becoming increasingly interconnected. Clients and major dealers are thinking globally and nonbank liquidity providers are expanding their global presence, bringing new technology and data capabilities to the ecosystem.

As clients seek more time and cost-efficient ways to interact across markets, we remain focused on delivering innovative collaborative solutions that enhance liquidity and efficiency across the global fixed income ecosystem. Diving into the third quarter, despite muted volatility, strong client activity drove 13% year-over-year revenue growth on a reported basis. We produced strong third quarter revenue growth despite facing increasingly tougher year-over-year comparisons, especially in August, which last year defied the typical seasonal slowdown and was exceptionally active as macro growth fears grip the market and the yen carry trade collapsed. Our international revenues continue to scale higher delivering 25% year-over-year growth as our strategic initiatives in EM and APAC continue to pay off. We continue to balance investing for growth and profitability as adjusted EBITDA margins expanded by 54 basis points relative to the third quarter of 2024.

Turning to Slide 5. Rates produced its second highest revenue quarter driven by continued organic growth across swaps and global government bonds, while mortgages produced record revenues. Credit growth was led by strength across munis, European credit and emerging market credit. Money markets revenue growth was led by the addition of ICD and aided by record quarterly revenues across global repos. ICD continues to build back balances post the April volatility that led to some large clients drawing down their money market fund balances to tactically buy back shares in the market and increase spending ahead of potential tariffs.

ICD revenues were up 7% relative to the second quarter of 2025. Equities posted another strong growth quarter with revenues up 17% year-over-year, led by growth in global ETFs and equity derivatives. Other revenues grew over 50% as we see growing contributions from our emerging digital asset initiatives. Finally, market data revenues were driven by growth in our proprietary data products. We have reached an agreement in principle to renew the LSEG market data agreement, which is up for renewal at the end of October, for an additional 3 years striking the right balance between maintaining the integrity of our platform and commercializing our rich data sets.

We expect this agreement will not only generate significant more revenue for Tradeweb, which Sara will touch on later, but it also maintains flexibility to grow our proprietary data business. We also see additional upside as we build more products to enhance the trading experience of our clients.

Turning to Slide 6. This quarter saw a significant drop in intraday volatility from the off-the-chart levels seen in prior periods, specifically it was down 19% year-over-year and 30% quarter-over-quarter. All in, U.S. treasury revenues decreased slightly by 2% year-over-year as positive revenue growth across our institutional channel was more than offset by weaker wholesale trends, a business that tends to thrive when there is heightened volatility. One of the trends that has attracted a lot of attention this year is the rise of voice activity in tandem with, and not at the expense of, electronic trading.

Year-to-date, electronic industry average daily volume saw a 10% increase year-over-year. We also saw a 26% increase in industry voice average daily volume. This distinction is very important. Electronic trading remains robust and should continue to rise, but we are operating with a continued paradigm of extreme market conditions, this time marked by unusually low volatility. This is driving more complex voice-centric package trades in the market, a mix shift that weighed on our U.S. treasury market share, which stood at 22% in the third quarter.

However, our share is rebounding. It increased quarter-over-quarter with September reaching the highest levels since March of this year. In addition, this week, we did our first package trade with a bespoke swap versus the U.S. Treasury. This is an entry point into a world of more complex package trades across the deep liquidity we have in U.S. treasuries and swaps. Our competitive position remains strong on a relative basis, we exceeded 50% for the sixth consecutive quarter in institutional U.S. treasuries versus our main electronic competitor.

During the quarter, we expanded our dealer algorithmic execution capabilities. We expect additional global dealer algos to be onboarded in the coming months, further enhancing our unified multi-dealer and multi-asset platform. Finally, attacking voice packaged trades remains a main focus for the team, and we believe we have all the solutions in-house, especially with our r8fin asset.

Turning to wholesale U.S. treasuries. Revenues were down 6%, mainly driven by lower volumes across our central limit order book, partially offset by growth across our wholesale streaming protocol. Wholesale continues to be a strategic priority as we focus on expanding our network of liquidity providers and strengthening our liquidity pools in alignment with our multi-protocol platform strategy. In equities, ETFs posted strong double-digit revenue growth as we continue to deepen integration with our clients. A key differentiator with our ETF clients has been our AiEX automation solution with average daily trades increasing over 90% year-over-year. While AiEX is deeply penetrated across European ETFs, we are now seeing strong adoption across U.S. ETFs with AiEX average daily trades up 70% quarter-over-quarter.

Our efforts to broaden our equity presence beyond our flagship ETF franchise continued to pay off with institutional equity derivative revenues up 16% year-over-year. Looking ahead, the pipeline remains strong as the benefits of our electronic solutions continue to resonate with our clients.

Turning to Slide 7. Global Rates continue to deliver diversified revenue growth across an expanding range of products and geographies. Rates have been a core growth engine for us with year-to-date revenues up 23% year-over-year and averaging 16% annual growth since 2019 with international being a highlight. Even with our scale, the majority of Global Rates products still trade over the phone or chat. That's a significant opportunity. We are leaning into it by building more innovative electronic solutions that make markets more efficient, transparent and connected across swaps, government bonds and mortgages.

We are pushing into new voice-centric markets like bilateral and multi-asset package swaps, specified pool trading and mortgages and packaged trading across global government bonds. Altogether, we estimate these initiatives to open up a revenue TAM of nearly $500 million annually. By capturing share from traditional voice trading and continuing to innovate with clients, we continue to strengthen our competitive position in Global Rates.

Moving to Slide 8. We have spent years building our strong global interest rate swaps foundation, and it's paying off. Clients continue to shift more of their workflow from voice to electronic and we're right at the center of that change. What started as a regulatory push has evolved into a structural movement. Clients and dealers have never been so invested in building out more efficient workflow options for their voice flow. From 2019 through 2024, swaps revenues have grown at more than 20% on average. And year-to-date, we have accelerated to 40% year-over-year. Just like our broader rate franchise, the growth has been diverse, over 30% year-to-date revenue growth in European and dollar swaps, over 70% across APAC and our emerging market initiatives alone added over 500 basis points to our total swaps year-to-date revenue growth.

We are seeing a client base that's deeply engaged, active, cross-currency and increasingly electronic. And while compression can sometimes mask the strength of the business, the underlying trend is clear. We continue to grow our overall risk market share. Even with all of that progress, the majority of swaps trading is still voice-driven, which means there's plenty of room ahead for continued electronification. Our team continues to innovate around that opportunity. We're expanding our presence in emerging market swaps, building multi-asset package swaps capabilities across our clear developed market currencies and making early headway in the bilateral swap space.

Each of these initiatives opens new ways for clients to connect, trade and unlock efficiency on Tradeweb. Focusing on the third quarter, global swaps delivered record revenues driven by a combination of strong client engagement, a dynamic macro backdrop, a favorable mix shift towards risk trading and a 7% year-over-year increase in weighted average duration. Altogether, global swaps revenues grew over 30% year-over-year. Core risk market share, which excludes compression trading had a record, rising over 130 basis points year-over-year. Total market share declined from 22.4% in third quarter '24 to 21.2% in third quarter 2025, largely due to a significant reduction in European client-related compression volumes, which carry much lower fee rates.

The third quarter highlighted the continued global expansion of our swaps franchise. We achieved record revenues across EM and institutional dollar swaps revenues, while European swaps revenues rose nearly 30% year-over-year. Our strong performance was supported by an 8% year-over-year increase in global active users. We continue to make progress across emerging market swaps and our rapidly growing request for market protocol. Our third quarter EM swaps revenues produced another strong quarter, while our RFM protocol also saw average daily volume more than double year-over-year with adoption picking up.

You can see Slide 17 of the earnings presentation for our usual global swaps disclosure. Looking ahead, we continue to believe the long-term growth potential for swaps remains significant with just 30% of the cleared swaps market currently electronified, there is substantial runway to digitize workflows alongside our clients. Our clients have stayed very engaged given the fluid global macroeconomic backdrop, and we continue to partner with them to create better workflow solutions across a growing part of the cleared markets and make inroads into the uncleared swaps market.

This month, we launched the first fully electronic swaption package trading protocol in the market, a major step forward in bringing transparency efficiency and 2-way pricing to a product that has historically traded almost entirely by voice.

Shifting to Global Credit on Slide 9, low single-digit revenue growth for Global Credit was driven by strong double-digit revenue growth in both European credit and municipal bonds, which more than offset weakness in U.S. credit, where revenues fell year-over-year, mainly due to retail corporate credit revenues that were down nearly 30% year-over-year, primarily reflecting the better relative yields our clients were getting across money markets and munis. Automation continues to resonate with Global Credit AiEX average daily trades, increasing 5% year-over-year.

U.S. credit remains a key growth initiative. We are focused on maintaining our leadership position in our pioneering portfolio and session trading protocols and increasing our block market share, perhaps most importantly, continuing to increase our RFQ share which we expect to be the #1 driver of revenue growth in U.S. credit going forward.

Our deepening liquidity pool and continuously improving client experience is resonating as we attract more clients and experienced talent across the board. We achieved record block share for the quarter in fully electronic U.S. investment grade at 10%. Our volume growth was driven by continued adoption of our Portfolio Trading, RFQ and sessions protocols. Institutional RFQ average daily volume grew 13% year-over-year with double-digit growth in both IG and high yield. Our efforts to expand into RFQ are seeing continued signs of success with our IG RFQ share of overall TRACE up over 60 basis points year-over-year. Portfolio Trading average daily volume also increased over 10% year-over-year, with over 30% growth across international Portfolio Trading. During the quarter, we saw our largest line item portfolio trade at over 4,000 lines. Additionally, we saw our largest ever international portfolio trade at nearly $1.4 billion. We saw double-digit active user growth across the U.S. and international PT, and we continue to expect adoption of the Portfolio Trading solution to expand.

AllTrade had a strong quarter with over $200 billion in volume with average daily volume up almost 10% year-over-year. Our all-to-all average daily volume grew over 35% year-over-year while sessions average daily volume rose by nearly 10% year-over-year.

The team remains focused on expanding our network and increasing the number of responders on the AllTrade platform. We saw record responder rates across IG and we also saw strong ETF market maker participation across institutional credit with volume showing strong year-over-year gains.

Moving to Slide 10. One aspect of the Tradeweb story that often doesn't get enough attention is how far we've come internationally. Over the past few years, we've built tremendous momentum outside the U.S. with international revenues growing at a 19% compound annual growth rate from 2019 through 2024. And so far this year, they're up more than 30% year-over-year. Today, over half of our overall revenue growth is coming from outside the United States and about 1/5 of that is from regions beyond Europe and the U.K., mainly Asia. Regions that were once viewed as future opportunities have now become meaningful contributors to our business.

This success stems from the strength of our global presence and the deep relationships we've built with our international clients. Importantly, these clients aren't just engaging with Tradeweb for international fixed income products, they're increasingly turning to the platform for our home court U.S. products as well, underscoring the global reach and versatility of our offering.

Building on the success of our international expansion, we've also seen strong early results from our emerging markets initiative, much like our broader international strategy. We've been leveraging our established developed market presence to drive growth in these regions, and we believe it is working. Traders in emerging markets are deeply engaged with Tradeweb and increasingly drawn to our multi-asset class model trading an average of more than 5 products on our platform.

We're now pacing at over $100 million in annual revenue from emerging markets, nearly triple what we achieved in 2023. Yet even with this progress, we're only beginning to tap into a total addressable market exceeding $1.5 billion. Across emerging market swaps in particular, long-standing challenges such as geographic dispersion, pricing opacity and operational inefficiencies have traditionally made voice trading the default. That dynamic is changing. Tradeweb is helping to lead the shift towards electronification by providing clients with more discrete, transparent and efficient execution, innovations like our RFM protocol and AiEX are playing a key role in that evolution.

Beyond swaps, we're also seeing encouraging momentum in emerging markets cash credit, where revenues are up more than 40% year-over-year. Last week, we announced the successful launch of the first electronic bond alternative trading system in Saudi Arabia, a foundational moment for a fixed income market structure in the Kingdom and a testament to our growing geographic footprint. The opportunity ahead remains significant, not only within global fixed income and ETF markets, but also as we continue to build brand recognition and expand our footprint across more countries. And with that, let me turn it over to Sara to discuss our financials in more detail.

Thanks, Billy, and good morning. As I go through the numbers, all comparisons will be to the prior year period, unless otherwise noted.

Slide 11 provides a summary of our quarterly earnings performance. As Billy recapped earlier, this quarter, we saw revenues of $509 million that were up 13% year-over-year on a reported basis and 11% on a constant currency basis given the weakening dollar. We derived approximately 42% of our third quarter revenues from international clients and recall that approximately 30% of our revenue base is denominated in currencies other than dollars, predominantly in euros. Our variable revenues increased by 11% and total trading revenues increased by 13%. Total fixed revenues related to our 4 major asset classes were up 28% on a reported basis and 26% on a constant currency basis. Rates fixed revenue growth was primarily driven by an increase in minimum fee floors for certain dealers and by the addition of dealers to our mortgage and U.S. government bond platforms.

Credit fixed revenue growth was primarily driven by the previously disclosed introduction of minimum fee floors and the migration of certain dealers to subscription fees. Other revenues increased 52%, primarily driven by our digital initiatives. Specifically, we earned $2.3 million from our work with the Canton Network, where we are compensated in Canton Coins. This item will be variable quarter-to-quarter, reflecting fluctuations in the number of Canton Coins earned, Canton Coin prices and periodic tech enhancements for retail clients. Year-to-date adjusted EBITDA margin of 54.2% increased by 90 basis points on a reported basis when compared to our 2024 full year margins.

Lastly, this quarter's GAAP results include a $15 million realized gain from the sale of Canton Coins. For the first 9 months of 2025, we also recorded unrealized gains of $50.6 million. As a reminder, realized and unrealized gains are included in GAAP EPS and excluded from non-GAAP adjusted diluted EPS. As of the end of the third quarter, we held approximately 1.7 billion Canton Coins with a fair value of approximately $56 million, which is recorded on our balance sheet under other assets.

Moving on to fees per million on Slide 12, and I'll highlight of the key trends for the quarter. You can see Slide 19 of the earnings presentation for additional detail regarding our fee per million performance this quarter. For cash rates products, average fees per million were down 7%, primarily due to a mix shift away from U.S. government bonds, which carry a comparatively higher fee per million and a shift towards mortgages, which carry a lower fee per million.

For long-tenor swaps, average fees per million were up 21%, primarily due to a decline in compression activity. For cash credit, average fees per million decreased 15% due to the migration of certain dealers from fully variable plans to fix plans across institutional and wholesale U.S. credit and a mix shift away from retail within the U.S. credit which carries a higher fee per million.

For cash equities, average fees per million increased 1% due to higher fee per million in EU ETFs. And finally, within money markets, average fees per million decreased 4%, primarily due to a mix shift away from retail CDs, which carry a comparatively higher fee per million.

Slide 13 details our adjusted expenses. At a high level, the scalability and variable nature of our expense base allow us to continue to invest for growth and grow margins. We have maintained a consistent philosophy here. Adjusted expenses for the third quarter increased 12% on a reported basis and 11% on a constant currency basis.

During the third quarter, we continued investments in tech and communications, digital assets, consulting and client relationship development. Adjusted compensation costs grew 6%, driven by a 12% year-over-year increase in headcount and higher salaries, partially offset by lower accruals for performance-related variable compensation. Technology and communication costs increased 39%, primarily due to our continued investments in data strategy and infrastructure. Adjusted professional fees grew 6%, mainly due to an increase in tech consultants as we augment our offshore technology operations and build incremental scalability. This was partially offset by lower legal fees. Occupancy expenses increased 23%, primarily from increased rent due to the move of our new New York City headquarters, including duplicate rent of $241,000 in the quarter. Excluding duplicate rent, occupancy expense grew 18%.

Adjusted general and administrative costs increased 30%, primarily due to a pickup in travel and entertainment and unfavorable movements in FX. Unfavorable movements in FX resulted in a $1 million loss in the third quarter of '25 versus approximately a $400,000 gain in the third quarter of '24. Excluding FX, adjusted general and administrative costs grew 19%.

Slide 14 details capital management and our guidance. On our cash position and capital return policy, we ended the third quarter in a strong position with $1.9 billion in cash and cash equivalents, and free cash flow reached approximately $987 million for the trailing 12 months. Our net interest income of $19.8 million increased due to higher cash balances despite lower interest yields and included a onetime payment of $2.4 million related to interest income from a tax refund. With this quarter's earnings, the Board declared a quarterly dividend of $0.12 per Class A and Class B shares, up 20% year-over-year.

Turning to guidance for 2025. We are tightening our adjusted expense guidance to $1 billion to $1.025 billion. In the fourth quarter, we expect a similar sequential dollar increase in technology and communication expenses as we are seeing this quarter driven by continued investment in platform infrastructure, AI and data. We expect to see continued double-digit growth in technology and communications through 2026 based off the fourth quarter run rate. We expect fourth quarter professional fees to see a seasonal pickup similar to the fourth quarter of 2024. We expect adjusted G&A to rise sequentially, primarily due to an expected $4 million in FX losses based on where current FX rates are coupled with the usual seasonal rise in T&E, marketing and charity.

Lastly, we estimate fourth quarter occupancy expenses to increase by $1.5 million over the third quarter, primarily due to the move to our New York City headquarters in September, along with higher data center costs. All in, with these investments in FX-related impacts, we continue to expect our 2025 adjusted EBITDA margin to exceed 2024 levels although expansion will be more modest than last year as we support our current and future organic growth.

As Billy mentioned, we reached an agreement in principle to renew our market data contract with LSEG for a duration of 3 years that will see the contract increase in value by 9% annually, effective as of November 1. We are still in the process of formalizing the contract and finalizing the cadence of revenue recognition, and we'll provide an update on our fourth quarter earnings call. In the interim, for modeling purposes, you can use $22 million in revenue from the LSEG market data agreement for the fourth quarter, which is derived using the current monthly implied rate for the third quarter for October and growing that by 9% for November and December.

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

Thanks, Sara. 2025 is shaping up to be another banner year for Tradeweb even as the markets present their share of challenges. We have a data-driven Fed that reacts to each new data point and that, in turn, is influencing how our clients think about risk and express it through our platform. Across our client base, a clear theme is emerging, what I'd like to call, mechanized flow. Put simply, our clients are becoming increasingly systematic and data-driven in how they trade and that evolution aligns perfectly with how our global platform is built. That said, we're in a period where the market feels somewhat on autopilot with the lack of fresh data that makes it difficult for our clients to war game and position effectively. Low volatility and limited data or near-term headwinds, not just for us, but for the broader market.

Still, we believe the setup heading into 2026 is constructive. Volatility will normalize, data will return. And when it does, our clients will once again need to hedge and reposition their global books of risk. And importantly, the firm is not standing still. We are focused on what we can control, building innovative solutions across our clients' execution workflows to win market share from the voice markets. I remain incredibly proud of what we've achieved this year and confident in the opportunities ahead as we continue to partner with our clients to help redefine how the world trades fixed income.

Overall, revenue growth is trending approximately 9% higher relative to October 2024, which was exceptionally strong given the election volatility. While overall revenue growth is lower than we expected, this growth is happening in an environment of low volatility, fewer data points and without the benefit of an election year.

Our international business continued its strong revenue performance with October growth of nearly 20% year-over-year. The diversity of our growth remains a theme as we are seeing double-digit volume growth across global swaps, European government bonds, U.S. high yield, European credit, munis, China bonds, global ETFs and global repo. Our IG share is tracking below September levels, while our high-yield share is tracking above September levels.

Finally, I would like to thank our clients for their business and partnership in the quarter and recognize my colleagues for their efforts that contributed to the strong quarterly revenues and volumes at Tradeweb.

With that, I will turn it back to Ashley for your questions.

Thanks, Billy.

[Operator Instructions]

Q&A will end at 10:30 a.m. Eastern Time. Operator, you can now take our first question.

[Operator Instructions]

Our first question comes from the line of Chris Allen with Citi.

I wanted to get a little bit more on rate environment. Billy, as you noted, volatility in activity levels have been low. It sounds like clients are sitting on their hands to an extent. Just wondering, from your perspective, what potential catalysts are ahead that could spark volatility and improve activity. Also, you noted the lack of data impacting activity. Is there any way to gauge the impact of the government shutdown and the lack of releases on activity levels?

Yes. Chris, how are you? Thanks for the question. Speaking of volatility, I want to congratulate you on surviving your golf round with Sameer. October, I think, was like the lowest rate volatility since 2021. So your question is kind of interesting and I think timely. And Chris, obviously, when we kind of think about it to make an obvious point, our clients rely on data to make forward decisions starting with where to deploy capital, how do you position risk? When are you kind of leaning in? When are you risk on? And when are you kind of risk off. So your question is a good one. And I said this in my closing remarks a little bit, so let me get to it. Like I think for sure, from our perspective, part of the muted activity -- and I think mute is the right word.

Part of the muted activity, I think we've seen recently is tied to the lack of data points. That's obviously directly correlated to the government shutdown. Many of our clients, as you know, now are kind of more systematic and they rely on this kind of like they rely on as a war game and shape the forward strategy like real precise data, market makers and hedge funds have become very important to the financial ecosystem.

And I do think we've done a really good job of being like very front-footed on that trend. And so data is their fuel and there's no other way for me to describe that. So I think without overdoing it, I think they have been a little bit in this kind of like wait and -- wait and see mode as they traffic through the U.S. markets. I think the Fed, in an interesting way is maybe -- I don't want to say flying blind, but maybe a little bit -- I think there was a perception that they were a little bit on kind of autopilot.

I think something around that in an interesting way kind of naturally maybe sets up for surprises. And I think yesterday is a really good kind of indication around how kind of surprises kind of seep into the marketplace. So I think the rate cut announcement yesterday was accompanied by some new perspective, some new data. I think that interestingly, did kind of spark our markets.

We saw a very big selloff on the short end of the curve yesterday. The Fed announced that it will end QT, which we believe pretty strongly is a positive for our business. And I think they surprisingly raised questions about the pace of future cuts, which leads to this kind of activity around repositioning. So new data always sparks volatility. And I would say, looking ahead, we have growing, I think, descent within the Fed, so rate expectations and yield curve keeps changing.

Reminder, as we look to the forward, midterms, believe it or not, time is going so fast, midterms are looming. I'll make this point very specifically. We know that this is a regime that, by no means, kind of flies below the radar and the geopolitical landscape continues to remain very uncertain. And so these are, from our perspective, all potential catalysts for volatility and activity.

And so as I say all that, what I would say also, as you know very well, we operate a global business and its business, I would say, as usual, for our international clients, they are not being weighed down by data drought at all. So as we kind of reflect a little bit on the third quarter, even with volatility, roughly, I think it's roughly 20% below long-term averages.

From my perspective, we still delivered positive revenue growth in institutional treasuries, double-digit growth across mortgages. I think that's an important comment. European governments, global swaps have done well. Big picture, trends of higher global debt push for greater efficiency, leveraging electronic trading continue.

That's a really important kind of comment from me. And I think the recent move lower in rates has, without question, reinvigorated our leading mortgage business where we have significant market share and has been a flagship franchise for us for a long time. It delivered record revenues. Looking ahead, and I say this like very kind of clearly, I think it's a great time to be in the macro markets, global backdrop, you have moderate growth, using inflation, but also this kind of thing I said before, Chris, which is continued uncertainty and some structural challenges, tariffs on, tariffs off. We think we've been through move a little bit. I always say this very loud and clear, control what you can control. You know that we are not a company that remotely stand still.

So the focus is always going to be on expanding the electronic pie, building new solutions, continuing to compete with the voice markets, grow our overall revenue wallet. Very proud that we launched. We had our first electronic swaption trade this month for U.S. multi-asset package trade continuing to innovate and be front-footed. So good questions, Chris, and appreciate it always.

Our next question comes from the line of Jeff Schmitt with William Blair.

Electronic market share for treasuries has been down in recent months, I think, under 60% or even 55% of industry volumes. What's driving that greater mix of voice trades? I think you've pointed out package trades in the past. Is that still the case? And do you see this as a structural issue? Or could it be more temporary?

Yes, it's a really good question. And I don't see it structural, but let me get into it. I think your frame is a good one, and we say this all the time, and I've been really clear about this, like our biggest competition is the phone. It's the 1996 way of still doing business, not the 2026 way that the market will do business. And so when I think about sort of the holy grail of it all, it continues to be going after these kind of larger complex trades that continue to be transacted on the phone. Voice trading has always been a part of the U.S. treasury market, and there are certain strategies within the treasury market like basis trades and you mentioned it before, asset swaps, swap spreads that I would say have kind of historically lent themselves to more kind of 1996 kind of voice execution. They're often kind of more complex, multi-leg trades, larger notionals, and it's made it more kind of better suited for that type of activity.

Interestingly also, and let me kind of comment again with a bit of bluntness on this because it sort of does tie together with lower volatility and that little bit of -- a little conviction on rate direction, I think the instinct that we have is clients tend to focus on sort of more arbitrage opportunities within treasuries or between something like treasuries and futures and swaps. And so I think the instinct is these tend to be large notional package trades that remain predominantly voice-driven for now.

And I think we make a very strong point about saying for now because that's where a lot of the focus of that rates business is. And so yes, to your point, that has led to sort of parts of that market where voice volumes have been growing at a faster pace than the kind of straightforward kind of electronic flow that we live and breathe in.

I think what I would say is from a good news perspective, and again, this kind of speaks a little bit to the focus that we have, I think the share around what you described kind of bottomed in kind of April and May. And I would say that we've been seeing, I think, a real kind of reacceleration of our share through September and into October.

And I would say we expect that to continue. And then I kind of always kind of say like what's the big picture here. So kind of stepping back, I think the very strong instinct is always the advent of investment and new technology. It's a trend that has been unfolding for years. And it's -- like I would say, it's like hard to call kind of top around this continued expansion of electronification. We see it much as this kind of one-way train with a lot of room to run.

We're going to continue to apply kind of AI around the AiEX pricing. We think the move into the kind of how we think about the Defi ecosystem with stable coin and tokenization are very good trends for us. And across fixed income, electronic trading continues to grow because electronic trading continues to grow because it delivers this efficiency, competition, transparency, all of the processing and to make an obvious point, and it's really important that you hear me say this, these benefits are hard, if not impossible to replicate in the voice market, which gives us that kind of optimism as we continue to fine-tune and go after more of the complexity in the market.

And so I say this all the time, like I can get like a bit intense, but broad adoption does take time. It requires a thing that we know about really well, which is behavior change. behavior change from clients. But I think from our perspective, at Tradeweb, and Sara and I talk about this all the time, we're not complacent, but we're confident, I think, that the direction of travel around the ongoing electronification is pretty clear. So thanks very much for the question. Good to hear your voice.

Maybe just like amplifying one of the points that you made earlier in the earlier part of this call, when we talk about the percent of electronification in U.S. treasuries and Billy said this, it sometimes gets lost. The actual electronic ADV in this treasury market is up double digits year-to-date, right? So Billy is talking about this episodic increased voice flow that we have an opportunity to help electronify around packaged traits. But not to lose sight of the underlying business, the underlying industry trend is actually up 10% year-over-year. So both things are healthy opportunities.

Yes. Very good point, Sara.

Our next question comes from the line of Dan Fannon.

Sorry about the background noise here. But there's a general narrative around lower rates and what that means -- is that for trading volumes for -- and so I was curious about how the outlook for rates, given where the Fed funds curve is say, what you think about the outlook for the next year.

Yes. Good question. And maybe I'll take a little bit of this, and sir, you come in with me on this as well. And good morning to whoever said that I don't know on the call as well. So you and I know each other, Dan. So I've been at the company now it's amazing, I think it's like 25-plus years, getting older by the day. we've grown revenues every year, I say this very proudly because it has nothing to do with me. But every year, kind of irrespective of the rate environment. This is now -- I'm going to say this like pretty clearly 9 straight -- 9 straight quarters of double-digit revenue growth that we've kind of managed to do that, as you know, very well through a bunch of different kind of market environments because the focus is obviously always on building more innovative solutions to attack this thing I was saying before around more parts of the voice market.

So I want to make sure I'm really clear about that because that ethos has not changed over the past 25 years. And so maybe for a second, just like specifically around your question. Your question is not oversimplified, but I think in some ways, the view around that, as you know, I think, is a little bit oversimplified. This environment, from our perspective, I think, is constructive for us, right?

So we think about real yields of 2% to 3% on the short end, which we think makes fixed income quite an attractive income-generating tool. We think about the concept of kind of sustained upward sloping yield curve, which we think incentivized is something very, very important, which is duration extension. We think benefiting our higher duration products. I think that's like a really important thing for you to hear from me. Continued issuance would support and should support velocity and future secondary supply.

And so with respect to rates, we think it's very, very important to draw what I would say is a very clear and sharp distinction between lower rates and 0 rates. These are very different environments. I think history shows that trading volumes kind of ebb and flow in ways that you know very well, Dan, with volatility and policy expectations.

It's not just absolute level of rates. And so as rates trend lower, we expect private intermediation, which is something I've talked about a lot, it's back in vogue. The banks are capitalized and stronger than ever. Client-driven activity is going to continue to remain active. And we think -- and we're starting to hear this, that obviously, the central banks will remain a smaller part of the market than they were a few years ago. And so we think that's a very good environment for us. And Sara, if you want to add?

I think in addition to what Billy is talking about around what's really driving business volumes, I think it's also important to remember that lower interest rates actually impacts in a positive way, 2 of our biggest businesses around swaps and cash credit fee per million. So if you think about it, and I know we've talked a little bit about this before, but if you were just to take rates and drop them by 100 basis points across the curve, swap fee per million would increase by 4% or 5%, cash credit fee per million by 2%.

And as a reminder, it's because both of those businesses and fee structures operate on PV-01 or DV-01, so on the risk notional that's being traded. And then I know earlier, we talked about the shape of the curve, that also has a positive impact in terms of duration being extended in our products. And so as you think about the impact of that on fee per million, a 1-year increase in duration. So if you take it 10 years going to 11 years in a business like swaps, fee per million can go up 7% to 8% and credit a little bit less, but around 2%. So obviously, like when we think about our business, the way the business mix changes is the biggest driver of revenue. But structurally, when rates go down, there is this positive impact on fee per million holding all else constant, which I think is something sometimes people forget.

It's amazing, sir. If you look back at that kind of last period, Dan, of 0 rates, which is obviously a very different and kind of more challenging environment than what Sara was describing as kind of lower rates. So we're really kind of talking about that sort of like 2019 to 2021 time period where the Fed was kind of a large buyer. And you've heard me talk about that when the Fed was a large buyer in the market. I think U.S. treasury industry volumes were flat, but at that time, our revenue -- our revenues grew 14%, which is what you're describing, Sara. And swaps -- interest rate swaps volumes were down 14%, but our revenues were up 23% that year, which I think speaks a lot to how we are commercial in more challenging environments. And I think it's a good question, Dan. So we appreciate you always.

Our next question comes from the line of Alex Blostein with Goldman Sachs.

So I wanted to spend a minute on the topic of tokenized assets, obviously, quite an evolving landscape there. What are the opportunities, I guess, in risk that you see for Tradeweb on both of those fronts.

Great. Nice to hear from you, Alex. Maybe I'll start and Billy, feel free to chime in. I think -- look, it's a great question, and we are definitely spending a lot of time on tokenization and digital assets more broadly. So maybe let me cover a little bit about what we mean when we're talking about digital assets because I think everybody talks about different components about it. For Tradeweb, when we're talking about tokenization, stablecoins in digital assets, we're really talking about further modernizing the way financial assets trade. And so if you think about that, it's a natural extension of what we've done and what Billy and the team have done for 25 years in terms of electronifying voice markets, it's what we feel we do best. It's more efficiently enabling the transfer of risk. And so our goal, just like when we talk about electronifying markets is, we want to be a market leader.

We want to allow our clients to trade tokenized assets on blockchains. It's programmable, it's interoperable. It provides huge client benefits from our standpoint, faster settlement, things like 24/7 trading, data synchronization, I would love less reconciliation personally and capital efficiency, which is probably one of the biggest drivers. So from our seat, there's a lot of opportunity here when there's so much opportunities for our clients, and we have a right to win, which is sort of the first part of what I was getting at. And we've been at it for a while. We've been at it for over 3 years, given the regulatory tailwinds that appear to be lining up.

We think this is a real significant opportunity for us. And I think I say this with some appropriate humility, I think we feel we're well ahead of our peers in being able to provide both traditional and digital rails side by side for our clients at scale. So all of those components, I think, matter as we think about the forwards. We've made a number of targeted investments. I think, Alex, you've seen us do that in an effort to provide this end-to-end service, like connecting issuance, trading and settlement, being able to handle the cash leg and the asset leg as you think about tokenized assets.

And so I don't need to read the laundry list, but digital asset holdings, finality, securitize and of course, our work with Canton Network. The thing that's exciting, I think, especially from my seat as a CFO is we're really generating revenue. This is having a real impact.

And so obviously, early innings, but this year, we've already generated $5 million year-to-date from our work as a validator and super validator on the Canton Network. That's in addition to having 1.7 billion coins on our balance sheet, which are worth approximately $55 million. So I think there's real financial benefits. The digital business for us is something that we continue to invest in. We intend to expand our work with the Canton Network and obviously want to be part of growing that and building trading applications on it. So we think this is the beginning of our digital business. And I think it's really important to recognize that because we've been in this for a long time. It's not just financial investments, it's inorganic and organic like people at Tradeweb embedding these technologies and mortgages in repo in all of our traditional businesses.

I think, obviously, you can tell we're excited about it, always trying to be balanced. When we talk about the risks. I think complacency is probably the biggest risk that Billy and I spend a lot of time talking about. We don't take our position in the ecosystem lightly. We don't ever expect to be the only solution or only platform out there. But we do think, given how long we've been at it and some of the things that we can do uniquely and maybe more importantly -- and Billy like I know you feel strongly about this, who we've partnered with very strategically. We think we're in a good position to evolve with the market that going to keep changing.

It's always like a good question we still like, Alex. It's always a good question from Alex. I think it's impossible to look at kind of 2025 and not say that in exactly the way that you described it really, really well, Sara, that crypto exposure to gold and the [indiscernible] stocks have not become kind of macro products in our world.

And so when we kind of -- when I say that, Alex, about kind of crypto, I mean, I think it's fair to say that ultimately, we see institutional grade crypto as part of the kind of broader macro toolkit and we plan to play a role there. And part of the kind of partnerships, Sara, that you were alluding to, and I think very specifically around kind of the Canton Network partnership that we have is very, very important to us because we see kind of best-in-class there, and we see real potential partners with us in the kind of go-forward evolution potentially around that marketplace becoming more institutional.

And so as everybody here knows, the routes around that market are always, by definition, going to be kind of 24/7 stuff. And so as this kind of ties in, the general feeling is as fixed income products kind of follow that route around tokenization and 24/7 liquidity, we're going to play a leadership role with the potential, Alex, ability to pivot as a leader around institutional crypto trading. So this is all kind of very, very important and interesting stuff that I think is going to define really the next couple of years of electronic marketplaces.

Our next question comes from the line of Simon Clinch -- I'm sorry -- yes, Simon Clinch with Rothschild & Company.

I was wondering if you could talk -- maybe give us a sense of how to think about the next stages of electronification in the U.S. credit in particular? And how Tradeweb is positioned to both drive and benefit from this trend, specifically in terms of like the technologies you have in the pipeline to accelerate this opportunity, how value trading fits into the frame, particularly in the case of blocks? And ultimately, how we should think about the revenue benefits that accrue from this opportunity?

Sure. I said before about kind of to be kind of super focused, but also with an understanding that human behavior change takes a little bit of time. So I'll make the most obvious point on this entire earnings call. Electronification and credit has never been and will never be kind of straight line stop. And so what we've seen is periods of gradual progress -- gradual progression followed from our perspective by kind of sharp accelerations when what we would say very key ingredients come together: better technology, improved data, shifts in trading behavior and more efficient post-trade process.

These are the kind of pieces of the ingredients that need to come together. And I'll say it this way for a second. At the same time, I think it's important to recognize and understand something that's embedded in your question, which is the credit market is structurally different from other asset classes. And I'll say it this way. I think from our perspective, I think liquidity in that marketplace can be a little bit fragile. It's a fragmented markets with thousands of individual bonds, sometimes limited depth that can change very quickly when conditions move.

And so the market itself, I would say this, like in my entire career, it's a challenge. And I say that optimistically because I think challenges plays to kind of Tradeweb strengths. So in a complex market, I think there's a real difference between just what we would say is like adding technology for technology sake and building balanced real solutions and collaborations with our partners.

I mean I think that is front and center, a fundamental ethos to how we partner with the buy side and with the dealers. We still feel exceptionally strong that we are right sided on Portfolio Trading. We think bringing the dealers back into the equation as market makers is a fundamentally important part of the marketplace. I would say there needs to be very strong and continued work on ultimately delivering the dealers' balance sheets and inventories to the most sophisticated, most important clients.

I think that's an important endeavor that we are working on. And ultimately, as you know well, this piece of the market is going to be defined as innovations that ultimately land, again, this concept of the holy grail around risk trades.

And so we have our best and brightest in the credit business, working on this all the time. I feel very, very strong and proud around how we've landed in credit, and the company is extremely focused into 2026 and continuing to make progress there. So appreciate it, Simon.

Our next question comes from the line of Craig Siegenthaler with Bank of America.

This is Elias Abboud on for Craig. You launched treasury trading on ICD last quarter. Can you update us on what adoption has looked like? Do you have any plans to launch more products in ICD? And then bigger picture, you're still sitting on a lot of cash. Is there more opportunities for M&A in the corporate channel going forward?

It's Sara. I'll take that. I think we are really excited. We've seen early interest from our Tivo launch on ICD, which we did at the end of the second quarter, and we've already had a few clients execute their first trades this month. So good momentum and progress there. What's been encouraging even beyond that is some of the largest potential clients we have in our pipeline, those who previously passed on ICD are now more focused on reengaging because of this added ability to bring Tradeweb products onto the platform, the ICD portal.

So I think holistically, we continue to see momentum around that strategy. Obviously, it takes time in their long sales cycles. Beyond that, we're very focused on making the whole experience when we brought Tradeweb and ICD together to be more seamless. So there's work that we're doing to integrate straight through processing between our organizations and platforms and obviously, a couple of aspects on the custody relationship. So more to come on that, but I think good progress.

And beyond ICD, the second part of your question, just in terms of bigger picture sitting on cash and M&A. Look, I think Billy has been really clear. We are an ambitious company, and we continue to consistently evaluate buy versus build, investments, outright M&A. Just because we have the cash does not mean that we're going to be lacking in discipline. So the bar is high, and we have a number of strategic and financial objectives that anything that we deploy capital against has to meet, but I think you've heard us talk about some of the areas that we're most excited about on this call, whether it be digital, an area that we're evaluating continued investments, both inorganically and organically.

Billy's talked about institutional crypto. As that world evolves, I think there are things that we can do to accelerate our technology build there and areas that are adjacent to some of our markets like private credit. So in particular, we're focused on where the biggest opportunities are the growth in the marketplace that are adjacent to what we do, where we think we have a right to win. And so I think the inorganic question is much more than just M&A from our seat. It's a combination of partnerships investments as well as looking at acquisitions. So I hope that helps.

Our next question comes from the line of Ken Worthington with JPMorgan.

Maybe following up here. Sara, you highlighted in that '25 would be an investment year, remain open to evaluating M&A opportunities, like if and where appropriate, when you're looking at the product suite as it stands today, are there particular protocols, technologies, geographies that you think could better amplify Tradeweb's value proposition? And to Alex's question earlier, you spent a lot of time on digital and the Canton Network. Are there pieces particularly on the digital side, that would be helpful to fill in here.

Yes, obviously. Billy, feel free to jump in. I think -- I'd say I'd characterize, we don't see any major gaps across our asset classes, protocol, geography set. We think we're highly global, really diversified across client channels as well as asset classes. But we do consistently evaluate where can we amplify or accelerate. And so the areas I probably just highlighted are areas that we would call more frontier markets on the adjacent standpoint that I think are our biggest opportunity is to add potential asset classes, like when Billy talks about institutional crypto, we think of that as an adjacent asset class and in some ways, an extension of clients, right, more crypto-native firms.

So that would be an area that I'd highlight. It's interesting when you take a different lens around digital, and you asked a little bit about life cycle, I think that's like a really good adding dimension to look at. Sometimes, people think Tradeweb is only focused on what I would call the match, like the execution.

The reality is our offering goes from pre-trade analytics to execution to post-trade in a lot of different scenarios. I think what's really interesting about some of the work we're doing in the digital space is it can make our participation across the full trading life cycle even more efficient, both from providing a service from -- to clients, but also from a capital perspective. So I would say, if anything, as the world evolves and we don't think it will be binary, I think our role and opportunity across the trading life cycle, that opportunity kind of grows in multiple dimensions beyond just purely a trade execution.

Our next question is from the line of Benjamin Budish with Barclays.

Billy, in your prepared remarks, you talked a lot about very low levels of market volatility and what that's doing to electronic share. I'm just curious, I think earlier in the Q&A, you talked about your outlook for [ e-share ]. Maybe just on market volumes in general, both TRACE and U.S. Treasury. What are your thoughts on? Why is that the case it feels like uncertainty remains quite high. The comps are fairly tough, but like what do you think are the reasons that market volumes have been a little bit lower? And how do you think about how that unfolds over the next 6, 12 months?

It's a little bit of what I was saying before, and it's a really good question. There's been a little bit of the kind of Fed on autopilot, lack of data. Your question is a really interesting one. And as I'm kind of thinking about it, when you think about '26, you know that factors around kind of timing of rate cuts is going to be very, very important, like continued kind of fiscal developments. There's going to be macro data surprises. We know that credit risk are coming to light. That's a big deal.

So we feel kind of like volatility and client activity is big time coming back into the marketplace. You know that we're going to kind of win in the storm, right? We've shown our ability to win in the storm consistently, whether or not that storm was way back when kind of COVID or the regional crisis, that storm that took place or then just very, very recently, obviously around kind of liberation moments within the marketplace.

We're going to win in the storm. I feel very strongly that we're also going to win in the comp and we have been winning in the comp. And so that's where we kind of talk about this kind of concept of mechanized flow. And back to the basics around RFQ technology. These environments play very, very well for us in part because of our ability to kind of engage them with clients and to put innovations into the marketplace at periods of calm, I think, plays extremely well to our strengths down the road.

So I kind of say this with a little bit of a wink. Nobody knows anything. The very strong instinct is comm markets lead to something very different and we've seen little even pieces of that as of yesterday afternoon when the market just saw something different than I had expected to see an activity kind of surged very quickly in volatility search.

As a consequence of that, it's going to be a very interesting, I think, market dynamic into 2026. And I think our general feeling here is, and kind of Sara said it with humbleness, but with a tremendous amount of confidence, I think we sit extremely well positioned to be that partner to the industry. So as always, Ben, a very good question and appreciate it, thank you.

You know it's interesting, I think, also in what you're saying as you think about our ability to win in the storm and in the comp, the financial model supports that as well, which I think is a really important and unique advantage. So we've had a market environment that was extremely volatile in the beginning half of the year and last year.

And as you think about one of the things that we do as an organization, as a management team, we've accelerated a lot of investment to invest through the cycle, in particular, been able to deploy a lot of capital in those environments for things that are new initiatives, which I know Ash and Sameer have highlighted in some of the new slides that we put out, but new initiatives like in spec pools, in bilateral swaps and obviously, in government bonds and being able to do those through the cycle, regardless of if it's like highly volatile or not as volatile, I think, really sets that groundwork for us to perform in all different environments.

So that ability to have sustained investment through the cycle, I think is a complement, a different way of looking at kind of why I think Billy's point around we can win in either environment is really backed up.

Our next question comes from the line of Alex Kramm with UBS.

Late here, but look, there's been a lot of questions today, I feel like on electronification of various markets, both longer term. The one that hasn't come up is actually our largest business, which is interest rate swaps. And I think, Billy, you mentioned earlier in your prepared remarks, only 30% of the market is -- of the cleared IRS market is electronic today. So this may be a little bit nitpicky, but I feel like I've heard that number for multiple years, maybe even back to the IPO. So just wondering, is it just a very rounded number? Is there just not good data out there? Or has the market actually not electronified more in the last few years? It's just all been market growth that you've been participating in?

You have a good memory, Alex. And it's such a good memory, and it's just a good question and I'm definitely going to have to have Sara answer it, but I'll first by acknowledging. I thought I had a good memory until I got to know you, but it's a very good question.

Actually, it's a great question because it does give us an opportunity to unpack something, which is true across a bunch of different aspects around our business because it is so nuanced and there's so many layers in it. So swaps, yes, is one of our biggest businesses, most important and growing most quickly, that 30% number, like a lot of things, is this monolithic large pie and can mask a lot of the underlying trends that are really important. So swaps and that 30% number, as an example, include compression, right? And as we've talked about every quarter, compression volumes can be really large, obviously don't come with the same amount of revenue and can distort what's going on.

So if I take out compression trades and really focus on what we call risk-based swap share for electronification or some people would call like DV01 based swaps in that market, you can really see that electronification trend much more clearly.

So in terms of that piece, that risk base, which really drives revenue in 2020, the total electronification was 10%. And if we compare to where we are now, that number is 19%. So that's 150 basis points per annum over that 5-year period. And I think really gets to what you're saying, which is like, oh, okay, there is some real movement and actually that movement, what moves revenue. So when you know our revenues have moved in excess of double digits, you kind of have that clearer picture.

It's not the only way to look at it. I'd say the other big driver we spend a lot of time talking about, but gets buried in that 30% is emerging markets. So emerging markets in 2020 was like 1%. I don't know if you can even measure 1%, but 1% electronic, it really wasn't electronic at all. And now as we fast forward to where the market is in 2025, and we obviously view ourselves as a leader in that market, it's at 18%, so that market is growing 300 basis points year-over-year in terms of electronification. So to your point, sometimes when you're trying to cover a broad universe with a single stat, it cannot do justice to some of the underlying trends that are really important, especially when you think about what drives our revenue opportunity going forward and our investment dollars. So thanks for the question. I don't know if you want to add anything.

That's perfect.

And our last question comes from the line of Kyle Voigt with KBW.

Maybe a question on capital priorities. Just given the pullback in share price, have your capital allocation priorities shifted at all? And I guess, why haven't you stepped up for purchases in light of that pullback in the share price? And then you addressed some of the inorganic investment outlook in a prior question, but also maybe you could address the priorities for organic investments from an asset class or product perspective as we're looking out over the next year.

Great question. Okay. So there's a near-term view and a long-term view, and I don't want to conflate those. Long term, there's really no change in our capital management philosophy. But I think to the point and sort of the temperature around that question, given where the share price is, we do have a fundamental value on what the company is worth and don't really feel the valuation fully reflects all the opportunities we have in front of us. So we're definitely actively looking at share repurchases and being opportunistic in the market.

Obviously, we have to wait till the window opens up again into your point a little bit about why we weren't active in the earlier part of the market. There are times when the window is open and isn't, and we have an active set of M&A targets and pipeline activities that we look at. So I think don't take that as we think this is where the stock should trade, I do think as we think longer term, the waterfall isn't really any different than it's been over the last 5 years, at least since I've been here.

First and foremost, organic, then M&A then share repurchases and then dividends, which we like to grow in line with earnings. On the organic front, and I think we've talked a lot about the inorganic front on this call, and Billy feel free to chime in, I think some of the areas where we continue to invest, obviously, EM has been a big focus for us. swaps and credit, really a consistent focus for us. And then increasingly, things like AI, our data infrastructure strategy and digital are areas that we're spending a lot of time all organically, even if they're complemented by inorganic strategies. So those are all things that we see large TAMs for and our ability to leverage what we do well to drive long-term growth.

Perfectly said. I would only mess it up by adding something in, but as always a great question, thank you.

Thank you. And this will conclude our Q&A session. I will pass it back to Billy Hult for his final comments.

Thank you all very much for joining us this morning. As always, if you have any follow-up questions, please feel free to reach out to Ashley, Sameer and the team. Have a great day, everybody, and thank you.

And with that, we conclude our conference. Thank you for participating. You may all disconnect.