Delaware |
001-38860 | 83-2456358 |
||||||
(State or Other Jurisdiction
of Incorporation)
|
(Commission
File Number)
|
(I.R.S. Employer
Identification No.)
|
||||||
1177 Avenue of the Americas
New York, New York
|
10036 |
|||||||
(Address of Principal Executive Offices) |
(Zip Code) |
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||||
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||||
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||||
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
||||||||||||
Class A common stock, par value $0.00001 | TW | Nasdaq Global Select Market |
Exhibit Number |
Exhibit Description | |||||||
104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
TRADEWEB MARKETS INC. | |||||||||||
Date: October 26, 2023 |
By: | /s/ Douglas Friedman | |||||||||
Name: Douglas Friedman | |||||||||||
Title: General Counsel |
Investor Relations
Ashley Serrao + 1 646 430 6027
Ashley.Serrao@Tradeweb.com
|
Media Relations
Daniel Noonan + 1 646 767 4677
Daniel.Noonan@Tradeweb.com
|
|||||||||||||
TRADEWEB REPORTS THIRD QUARTER 2023 FINANCIAL RESULTS |
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New York, October 26, 2023 – Tradeweb Markets Inc. (Nasdaq: TW), a leading, global operator of electronic marketplaces for rates, credit, equities and money markets, today reported financial results for the quarter ended September 30, 2023. |
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$328.4 million quarterly revenues, an increase of 14.4% (12.5% on a constant currency basis) compared to prior year period
$1.4 trillion average daily volume (“ADV”) for the quarter, an increase of 29.6% compared to prior year period; quarterly ADV records in fully electronic U.S. High Grade credit, global repurchase agreements, Chinese bonds and swaps/swaptions ≥ 1-year; record 16.6% share of fully electronic U.S. High Grade TRACE and a record 7.8% share of fully electronic U.S. High Yield TRACE
$111.6 million net income and $130.8 million adjusted net income for the quarter, increases of 36.9% and 22.8% respectively from prior year period
51.9% adjusted EBITDA margin and $170.4 million adjusted EBITDA for the quarter, compared to 51.0% and $146.3 million respectively for prior year period
$0.46 diluted earnings per share (“Diluted EPS”) for the quarter and $0.55 adjusted diluted earnings per share
$0.09 per share quarterly cash dividend declared; $4.9 million of shares repurchased
|
Billy Hult, CEO of Tradeweb:
“Tradeweb delivered record third-quarter revenues, as heightened focus on fixed income and a sustained period of high interest rates dominated institutional, wholesale and retail client sectors. Reflecting the breadth of Tradeweb’s business, our nearly 30% year-over-year increase in quarterly ADV was fueled by strong volumes in rates, credit, equities and money markets. We continued to grow market share in credit, where our record share of fully-electronic U.S. High Grade TRACE increased by 263 bps compared to the prior year period – and has more than quadrupled over the past five years. We made continued progress against our strategic growth priorities with the closing of the Yieldbroker acquisition during the third quarter. Today, we also announced a new licensing agreement with LSEG Data & Analytics (Refinitiv), allowing LSEG to distribute our market data while providing Tradeweb with increased revenue and flexibility as we grow our market data offering.”
|
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SELECT FINANCIAL RESULTS |
3Q23 | 3Q22 | Change |
Constant
Currency
Change(1)
|
ADV (US $bn)
(Unaudited)
|
|||||||||||||||||||||||||||||||||||||||
(dollars in thousands except per share amounts)(Unaudited) | Asset Class | Product | 3Q23 | 3Q22 | YoY | |||||||||||||||||||||||||||||||||||||||
GAAP Financial Measures | Rates | Cash | $ | 361 | $ | 324 | 11.5 | % | ||||||||||||||||||||||||||||||||||||
Total revenue | $ | 328,357 | $ | 287,115 | 14.4 | % | 12.5 | % | Derivatives | 492 | 329 | 49.7 | % | |||||||||||||||||||||||||||||||
Rates | $ | 172,832 | $ | 148,167 | 16.6 | % | 14.6 | % | Total | 853 | 653 | 30.7 | % | |||||||||||||||||||||||||||||||
Credit | $ | 90,062 | $ | 78,101 | 15.3 | % | 13.8 | % | Credit | Cash | 13 | 9 | 39.6 | % | ||||||||||||||||||||||||||||||
Equities | $ | 20,890 | $ | 21,277 | (1.8) | % | (4.8) | % | Derivatives | 17 | 20 | (15.3) | % | |||||||||||||||||||||||||||||||
Money Markets | $ | 15,763 | $ | 12,969 | 21.5 | % | 20.0 | % | Total | 30 | 29 | 2.1 | % | |||||||||||||||||||||||||||||||
Market Data | $ | 22,956 | $ | 21,222 | 8.2 | % | 6.9 | % | Equities | Cash | 9 | 9 | 7.7 | % | ||||||||||||||||||||||||||||||
Other | $ | 5,854 | $ | 5,379 | 8.8 | % | 8.8 | % | Derivatives | 9 | 7 | 34.8 | % | |||||||||||||||||||||||||||||||
Net income | $ | 111,630 | $ | 81,566 | 36.9 | % | Total | 19 | 16 | 19.7 | % | |||||||||||||||||||||||||||||||||
Net income attributable to Tradeweb Markets Inc. (2) |
$ | 98,614 | $ | 69,083 | 42.7 | % | Money Markets | Cash | 522 | 401 | 30.3 | % | ||||||||||||||||||||||||||||||||
Total | 522 | 401 | 30.3 | % | ||||||||||||||||||||||||||||||||||||||||
Diluted EPS | $ | 0.46 | $ | 0.33 | 39.4 | % | Total | $ | 1,424 | $ | 1,099 | 29.6 | % | |||||||||||||||||||||||||||||||
Net income margin | 34.0 | % | 28.4 | % | +559 | bps | ||||||||||||||||||||||||||||||||||||||
Non-GAAP Financial Measures | ||||||||||||||||||||||||||||||||||||||||||||
Adjusted EBITDA (1) |
$ | 170,360 | $ | 146,334 | 16.4 | % | 16.5 | % |
(1) Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted Net Income, Adjusted Diluted EPS and constant currency change are non-GAAP financial measures. See "Non-GAAP Financial Measures" below and the attached schedules for additional information and reconciliations of such non-GAAP financial measures.
(2) Represents net income less net income attributable to non-controlling interests.
|
|||||||||||||||||||||||||||||||||||
Adjusted EBITDA margin (1) |
51.9 | % | 51.0 | % | +92 | bps | +181 | bps | ||||||||||||||||||||||||||||||||||||
Adjusted EBIT (1) |
$ | 155,772 | $ | 133,114 | 17.0 | % | 17.2 | % | ||||||||||||||||||||||||||||||||||||
Adjusted EBIT margin (1) |
47.4 | % | 46.4 | % | +108 | bps | +192 | bps | ||||||||||||||||||||||||||||||||||||
Adjusted Net Income (1) |
$ | 130,794 | $ | 106,491 | 22.8 | % | 23.0 | % | ||||||||||||||||||||||||||||||||||||
Adjusted Diluted EPS (1) |
$ | 0.55 | $ | 0.45 | 22.2 | % | 22.2 | % | ||||||||||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Revenues | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||||||||||||||||||
Transaction fees and commissions | $ | 263,485 | $ | 228,015 | $ | 776,544 | $ | 717,489 | ||||||||||||||||||
Subscription fees | 46,361 | 41,342 | 136,483 | 124,337 | ||||||||||||||||||||||
Refinitiv market data fees | 15,460 | 15,370 | 46,515 | 46,354 | ||||||||||||||||||||||
Other | 3,051 | 2,388 | 8,677 | 7,559 | ||||||||||||||||||||||
Total revenue | 328,357 | 287,115 | 968,219 | 895,739 | ||||||||||||||||||||||
Expenses | ||||||||||||||||||||||||||
Employee compensation and benefits | 116,016 | 102,720 | 334,433 | 330,601 | ||||||||||||||||||||||
Depreciation and amortization | 46,559 | 44,778 | 137,850 | 133,998 | ||||||||||||||||||||||
Technology and communications | 19,733 | 16,816 | 56,001 | 48,626 | ||||||||||||||||||||||
General and administrative | 6,700 | 6,892 | 31,692 | 24,806 | ||||||||||||||||||||||
Professional fees | 10,479 | 9,400 | 32,321 | 25,832 | ||||||||||||||||||||||
Occupancy | 4,132 | 3,699 | 12,283 | 10,857 | ||||||||||||||||||||||
Total expenses | 203,619 | 184,305 | 604,580 | 574,720 | ||||||||||||||||||||||
Operating income | 124,738 | 102,810 | 363,639 | 321,019 | ||||||||||||||||||||||
Net interest income (expense) | 17,465 | 3,413 | 45,065 | 3,507 | ||||||||||||||||||||||
Other income (loss), net | (1,907) | — | (2,022) | — | ||||||||||||||||||||||
Income before taxes | 140,296 | 106,223 | 406,682 | 324,526 | ||||||||||||||||||||||
Provision for income taxes | (28,666) | (24,657) | (90,920) | (63,915) | ||||||||||||||||||||||
Net income | 111,630 | 81,566 | 315,762 | 260,611 | ||||||||||||||||||||||
Less: Net income attributable to non-controlling interests | 13,016 | 12,483 | 40,210 | 40,219 | ||||||||||||||||||||||
Net income attributable to Tradeweb Markets Inc. | $ | 98,614 | $ | 69,083 | $ | 275,552 | $ | 220,392 | ||||||||||||||||||
Earnings per share attributable to Tradeweb Markets Inc. Class A and B common stockholders: | ||||||||||||||||||||||||||
Basic | $ | 0.47 | $ | 0.34 | $ | 1.31 | $ | 1.08 | ||||||||||||||||||
Diluted | $ | 0.46 | $ | 0.33 | $ | 1.30 | $ | 1.06 | ||||||||||||||||||
Weighted average shares outstanding: | ||||||||||||||||||||||||||
Basic | 211,618,475 | 205,721,162 | 210,444,082 | 204,767,261 | ||||||||||||||||||||||
Diluted | 213,491,634 | 208,329,469 | 212,276,908 | 207,748,037 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
Reconciliation of Net Income to Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted EBIT and Adjusted EBIT Margin | September 30, | September 30, | ||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||
Net income |
$ | 111,630 | $ | 81,566 | $ | 315,762 | $ | 260,611 | ||||||||||||||||||
Merger and acquisition transaction and integration costs (1) |
4,614 | 43 | 6,411 | 40 | ||||||||||||||||||||||
Net interest (income) expense |
(17,465) | (3,413) | (45,065) | (3,507) | ||||||||||||||||||||||
Depreciation and amortization |
46,559 | 44,778 | 137,850 | 133,998 | ||||||||||||||||||||||
Stock-based compensation expense (2) |
525 | 2,675 | 1,960 | 13,839 | ||||||||||||||||||||||
Provision for income taxes |
28,666 | 24,657 | 90,920 | 63,915 | ||||||||||||||||||||||
Foreign exchange (gains) / losses (3) |
(6,076) | (3,972) | (4,242) | (6,306) | ||||||||||||||||||||||
Tax receivable agreement liability adjustment (4) |
— | — | — | — | ||||||||||||||||||||||
Other (income) loss, net |
1,907 | — | 2,022 | — | ||||||||||||||||||||||
Adjusted EBITDA |
$ | 170,360 | $ | 146,334 | $ | 505,618 | $ | 462,590 | ||||||||||||||||||
Less: Depreciation and amortization |
(46,559) | (44,778) | (137,850) | (133,998) | ||||||||||||||||||||||
Add: D&A related to acquisitions and the Refinitiv Transaction (5) |
31,971 | 31,558 | 95,217 | 95,088 | ||||||||||||||||||||||
Adjusted EBIT |
$ | 155,772 | $ | 133,114 | $ | 462,985 | $ | 423,680 | ||||||||||||||||||
Net income margin (6) |
34.0 | % | 28.4 | % | 32.6 | % | 29.1 | % | ||||||||||||||||||
Adjusted EBITDA margin (6) |
51.9 | % | 51.0 | % | 52.2 | % | 51.6 | % | ||||||||||||||||||
Adjusted EBIT margin (6) |
47.4 | % | 46.4 | % | 47.8 | % | 47.3 | % |
(1) |
Represents incremental direct costs associated with the acquisition and integration of completed and potential mergers and acquisitions. These costs generally include legal, consulting, advisory, due diligence, severance and other third party costs incurred that directly relate to the acquisition transaction or its integration. | ||||
(2) | Represents non-cash stock-based compensation expense associated with the Special Option Award and post-IPO options awarded in 2019 and payroll taxes associated with the exercise of such options. During the three and nine months ended September 30, 2022, this adjustment also includes $2.0 million and $9.4 million, respectively, of non-cash accelerated stock-based compensation expense and related payroll taxes associated with our former CFO and former CEO. |
||||
(3) | Represents unrealized gain or loss recognized on foreign currency forward contracts and foreign exchange gain or loss from the revaluation of cash denominated in a different currency than the entity’s functional currency. |
||||
(4) | Represents income recognized during the applicable period due to changes in the tax receivable agreement liability recorded in the consolidated statement of financial condition as a result of changes in the mix of earnings, tax legislation and tax rates in various jurisdictions which impacted our tax savings. |
||||
(5) | Represents intangible asset and acquired software amortization resulting from acquisitions and intangible asset amortization and increased tangible asset and capitalized software depreciation and amortization resulting from the application of pushdown accounting to the Refinitiv Transaction (where all assets were marked to fair value as of the closing date of the Refinitiv Transaction). |
||||
(6) | Net income margin, Adjusted EBITDA margin and Adjusted EBIT margin are defined as net income, Adjusted EBITDA and Adjusted EBIT, respectively, divided by revenue for the applicable period. |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
Reconciliation of Net Income to Adjusted Net Income and Adjusted Diluted EPS | September 30, | September 30, | ||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
(in thousands, except per share amounts) | ||||||||||||||||||||||||||
Earnings per diluted share |
$ | 0.46 | $ | 0.33 | $ | 1.30 | $ | 1.06 | ||||||||||||||||||
Net income attributable to Tradeweb Markets Inc. |
$ | 98,614 | $ | 69,083 | $ | 275,552 | $ | 220,392 | ||||||||||||||||||
Net income attributable to non-controlling interests (1) |
13,016 | 12,483 | 40,210 | 40,219 | ||||||||||||||||||||||
Net income |
111,630 | 81,566 | 315,762 | 260,611 | ||||||||||||||||||||||
Provision for income taxes |
28,666 | 24,657 | 90,920 | 63,915 | ||||||||||||||||||||||
Merger and acquisition transaction and integration costs (2) |
4,614 | 43 | 6,411 | 40 | ||||||||||||||||||||||
D&A related to acquisitions and the Refinitiv Transaction (3) |
31,971 | 31,558 | 95,217 | 95,088 | ||||||||||||||||||||||
Stock-based compensation expense (4) |
525 | 2,675 | 1,960 | 13,839 | ||||||||||||||||||||||
Foreign exchange (gains) / losses (5) |
(6,076) | (3,972) | (4,242) | (6,306) | ||||||||||||||||||||||
Tax receivable agreement liability adjustment (6) |
— | — | — | — | ||||||||||||||||||||||
Other (income) loss, net |
1,907 | — | 2,022 | — | ||||||||||||||||||||||
Adjusted Net Income before income taxes |
173,237 | 136,527 | 508,050 | 427,187 | ||||||||||||||||||||||
Adjusted income taxes (7) |
(42,443) | (30,036) | (124,472) | (93,982) | ||||||||||||||||||||||
Adjusted Net Income |
$ | 130,794 | $ | 106,491 | $ | 383,578 | $ | 333,205 | ||||||||||||||||||
Adjusted Diluted EPS (8) |
$ | 0.55 | $ | 0.45 | $ | 1.62 | $ | 1.40 |
(1) |
Represents the reallocation of net income attributable to non-controlling interests from the assumed exchange of all outstanding LLC Interests held by non-controlling interests for shares of Class A or Class B common stock. |
||||
(2) | Represents incremental direct costs associated with the acquisition and integration of completed and potential mergers and acquisitions. These costs generally include legal, consulting, advisory, due diligence, severance and other third party costs incurred that directly relate to the acquisition transaction or its integration. | ||||
(3) | Represents intangible asset and acquired software amortization resulting from acquisitions and intangible asset amortization and increased tangible asset and capitalized software depreciation and amortization resulting from the application of pushdown accounting to the Refinitiv Transaction (where all assets were marked to fair value as of the closing date of the Refinitiv Transaction). |
||||
(4) | Represents non-cash stock-based compensation expense associated with the Special Option Award and post-IPO options awarded in 2019 and payroll taxes associated with the exercise of such options. During the three and nine months ended September 30, 2022, this adjustment also includes $2.0 million and $9.4 million, respectively, of non-cash accelerated stock-based compensation expense and related payroll taxes associated with our former CFO and former CEO. |
||||
(5) | Represents unrealized gain or loss recognized on foreign currency forward contracts and foreign exchange gain or loss from the revaluation of cash denominated in a different currency than the entity’s functional currency. |
||||
(6) | Represents income recognized during the applicable period due to changes in the tax receivable agreement liability recorded in the consolidated statement of financial condition as a result of changes in the mix of earnings, tax legislation and tax rates in various jurisdictions which impacted our tax savings. |
||||
(7) | Represents corporate income taxes at an assumed effective tax rate of 24.5% applied to Adjusted Net Income before income taxes for the three and nine months ended September 30, 2023 and 22.0% for the three and nine months ended September 30, 2022. |
||||
(8) | For a summary of the calculation of Adjusted Diluted EPS, see “Reconciliation of Diluted Weighted Average Shares Outstanding to Adjusted Diluted Weighted Average Shares Outstanding and Adjusted Diluted EPS” below. |
Reconciliation of Diluted Weighted Average Shares Outstanding to Adjusted Diluted Weighted Average Shares Outstanding and Adjusted Diluted EPS | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
Diluted weighted average shares of Class A and Class B common stock outstanding |
213,491,634 | 208,329,469 | 212,276,908 | 207,748,037 | ||||||||||||||||||||||
Weighted average of other participating securities (1) |
265,681 | 246,238 | 266,453 | 121,115 | ||||||||||||||||||||||
Assumed exchange of LLC Interests for shares of Class A or Class B common stock (2) |
23,080,571 | 28,750,603 | 24,179,583 | 29,667,383 | ||||||||||||||||||||||
Adjusted diluted weighted average shares outstanding |
236,837,886 | 237,326,310 | 236,722,944 | 237,536,535 | ||||||||||||||||||||||
Adjusted Net Income (in thousands) |
$ | 130,794 | $ | 106,491 | $ | 383,578 | $ | 333,205 | ||||||||||||||||||
Adjusted Diluted EPS |
$ | 0.55 | $ | 0.45 | $ | 1.62 | $ | 1.40 |
(1) |
Represents weighted average unvested restricted stock units and unsettled vested performance-based restricted stock units issued to certain retired or terminated employees that are entitled to non-forfeitable dividend equivalent rights and are considered participating securities prior to being issued and outstanding shares of common stock in accordance with the two-class method used for purposes of calculating earnings per share. |
||||
(2) | Assumes the full exchange of the weighted average of all outstanding LLC Interests held by non-controlling interests for shares of Class A or Class B common stock, resulting in the elimination of the non-controlling interests and recognition of the net income attributable to non-controlling interests. |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
Reconciliation of Operating Expenses to Adjusted Expenses | September 30, | September 30, | ||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||||
Operating Expenses |
$ | 203,619 | $ | 184,305 | $ | 604,580 | $ | 574,720 | ||||||||||||||||||
Merger and acquisition transaction and integration costs (1) |
(4,614) | (43) | (6,411) | (40) | ||||||||||||||||||||||
D&A related to acquisitions and the Refinitiv Transaction (2) |
(31,971) | (31,558) | (95,217) | (95,088) | ||||||||||||||||||||||
Stock-based compensation expense (3) |
(525) | (2,675) | (1,960) | (13,839) | ||||||||||||||||||||||
Foreign exchange gains / (losses) (4) |
6,076 | 3,972 | 4,242 | 6,306 | ||||||||||||||||||||||
Adjusted Expenses |
$ | 172,585 | $ | 154,001 | $ | 505,234 | $ | 472,059 |
(1) |
Represents incremental direct costs associated with the acquisition and integration of completed and potential mergers and acquisitions. These costs generally include legal, consulting, advisory, due diligence, severance and other third party costs incurred that directly relate to the acquisition transaction or its integration. | ||||
(2) | Represents intangible asset and acquired software amortization resulting from acquisitions and intangible asset amortization and increased tangible asset and capitalized software depreciation and amortization resulting from the application of pushdown accounting to the Refinitiv Transaction (where all assets were marked to fair value as of the closing date of the Refinitiv Transaction). |
||||
(3) | Represents non-cash stock-based compensation expense associated with the Special Option Award and post-IPO options awarded in 2019 and payroll taxes associated with the exercise of such options. During the three and nine months ended September 30, 2022, this adjustment also includes $2.0 million and $9.4 million, respectively, of non-cash accelerated stock-based compensation expense and related payroll taxes associated with our former CFO and former CEO. |
||||
(4) | Represents unrealized gain or loss recognized on foreign currency forward contracts and foreign exchange gain or loss from the revaluation of cash denominated in a different currency than the entity’s functional currency. |
Trailing Twelve Months Ended September 30, |
||||||||||||||
Reconciliation of Cash Flow from Operating Activities to Free Cash Flow | 2023 | 2022 | ||||||||||||
(in thousands) | ||||||||||||||
Cash flow from operating activities | $ | 709,328 | $ | 616,473 | ||||||||||
Less: Capitalization of software development costs | (41,517) | (36,127) | ||||||||||||
Less: Purchases of furniture, equipment and leasehold improvements | (22,722) | (25,123) | ||||||||||||
Free Cash Flow | $ | 645,089 | $ | 555,223 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
EPS: Net income attributable to Tradeweb Markets Inc. | September 30, | September 30, | ||||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||||||||||||
(in thousands, except share and per share amounts) | ||||||||||||||||||||||||||
Numerator: | ||||||||||||||||||||||||||
Net income attributable to Tradeweb Markets Inc. | $ | 98,614 | $ | 69,083 | $ | 275,552 | $ | 220,392 | ||||||||||||||||||
Less: Distributed and undistributed earnings allocated to unvested RSUs and unsettled vested PRSUs (1) |
(124) | (82) | (348) | (111) | ||||||||||||||||||||||
Net income attributable to outstanding shares of Class A and Class B common stock - Basic and Diluted |
$ | 98,490 | $ | 69,001 | $ | 275,204 | $ | 220,281 | ||||||||||||||||||
Denominator: | ||||||||||||||||||||||||||
Weighted average shares of Class A and Class B common stock outstanding - Basic | 211,618,475 | 205,721,162 | 210,444,082 | 204,767,261 | ||||||||||||||||||||||
Dilutive effect of PRSUs | 504,945 | 746,043 | 380,740 | 796,090 | ||||||||||||||||||||||
Dilutive effect of options | 1,110,175 | 1,661,705 | 1,240,923 | 1,940,970 | ||||||||||||||||||||||
Dilutive effect of RSUs | 258,039 | 200,559 | 211,163 | 243,716 | ||||||||||||||||||||||
Dilutive effect of PSUs | — | — | — | — | ||||||||||||||||||||||
Weighted average shares of Class A and Class B common stock outstanding - Diluted | 213,491,634 | 208,329,469 | 212,276,908 | 207,748,037 | ||||||||||||||||||||||
Earnings per share - Basic | $ | 0.47 | $ | 0.34 | $ | 1.31 | $ | 1.08 | ||||||||||||||||||
Earnings per share - Diluted | $ | 0.46 | $ | 0.33 | $ | 1.30 | $ | 1.06 | ||||||||||||||||||
(1) |
During the three months ended September 30, 2023 and 2022, there was a total of 265,681 and 246,238, respectively, and during the nine months ended September 30, 2023 and 2022, there was a total of 266,453 and 121,115, respectively, weighted average unvested RSUs and unsettled vested PRSUs that were considered a participating security for purposes of calculating earnings per share in accordance with the two-class method. |
Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
September 30, | ||||||||||||||||||||||||||||||||||||||||||||||||||
2023 | 2022 | $ Change | % Change | |||||||||||||||||||||||||||||||||||||||||||||||
Revenues | Variable | Fixed | Variable | Fixed | Variable | Fixed | Variable | Fixed | ||||||||||||||||||||||||||||||||||||||||||
(dollars in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Rates | $ | 114,128 | $ | 58,704 | $ | 93,673 | $ | 54,494 | $ | 20,455 | $ | 4,210 | 21.8 | % | 7.7 | % | ||||||||||||||||||||||||||||||||||
Credit | 82,484 | 7,578 | 71,724 | 6,377 | 10,760 | 1,201 | 15.0 | % | 18.8 | % | ||||||||||||||||||||||||||||||||||||||||
Equities | 18,567 | 2,323 | 18,969 | 2,308 | (402) | 15 | (2.1) | % | 0.6 | % | ||||||||||||||||||||||||||||||||||||||||
Money Markets | 11,433 | 4,330 | 8,507 | 4,462 | 2,926 | (132) | 34.4 | % | (3.0) | % | ||||||||||||||||||||||||||||||||||||||||
Market Data | 115 | 22,841 | — | 21,222 | 115 | 1,619 | N/M | 7.6 | % | |||||||||||||||||||||||||||||||||||||||||
Other | — | 5,854 | — | 5,379 | — | 475 | — | 8.8 | % | |||||||||||||||||||||||||||||||||||||||||
Total revenue | $ | 226,727 | $ | 101,630 | $ | 192,873 | $ | 94,242 | $ | 33,854 | $ | 7,388 | 17.6 | % | 7.8 | % |
Three Months Ended | ||||||||||||||||||||
September 30, | YoY | |||||||||||||||||||
2023 | 2022 | % Change | ||||||||||||||||||
Rates | $ | 2.10 | $ | 2.23 | (5.7) | % | ||||||||||||||
Rates Cash | $ | 2.42 | $ | 2.23 | 8.5 | % | ||||||||||||||
Rates Derivatives | $ | 1.87 | $ | 2.24 | (16.4) | % | ||||||||||||||
Rates Derivatives (greater than 1 year) |
$ | 2.72 | $ | 3.46 | (21.4) | % | ||||||||||||||
Other Rates Derivatives (1) |
$ | 0.22 | $ | 0.27 | (19.1) | % | ||||||||||||||
Credit | $ | 43.26 | $ | 38.03 | 13.7 | % | ||||||||||||||
Cash Credit (2) |
$ | 162.20 | $ | 168.74 | (3.9) | % | ||||||||||||||
Credit Derivatives, China Bonds and U.S. Cash “EP” | $ | 5.75 | $ | 7.12 | (19.3) | % | ||||||||||||||
Equities | $ | 15.50 | $ | 18.69 | (17.1) | % | ||||||||||||||
Equities Cash | $ | 25.42 | $ | 29.33 | (13.3) | % | ||||||||||||||
Equities Derivatives | $ | 5.50 | $ | 5.28 | 4.1 | % | ||||||||||||||
Money Markets | $ | 0.35 | $ | 0.33 | 4.8 | % | ||||||||||||||
Total | $ | 2.51 | $ | 2.73 | (8.2) | % | ||||||||||||||
Total excluding Other Rates Derivatives (3) |
$ | 2.81 | $ | 3.05 | (7.9) | % |
(1) |
Includes Swaps/Swaptions of tenor less than 1 year and Rates Futures. |
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(2) | The “Cash Credit” category represents the “Credit” asset class excluding (1) Credit Derivatives (2) China Bonds and (3) U.S. High Grade and High Yield electronically processed (“EP”) activity. | ||||
(3) | Included to contextualize the impact of short-tenored Swaps/Swaptions and Rates Futures on totals for all periods presented. |
2023 Q3 | 2022 Q3 | YoY | |||||||||||||||||||||||||||
Asset Class | Product | ADV (USD mm) | Volume (USD mm) | ADV (USD mm) | Volume (USD mm) | ADV | |||||||||||||||||||||||
Rates | Cash | $ | 361,432 | $ | 22,842,103 | $ | 324,168 | $ | 20,774,062 | 11.50 | % | ||||||||||||||||||
U.S. Government Bonds | 142,641 | 8,986,371 | 123,736 | 7,919,082 | 15.28 | % | |||||||||||||||||||||||
European Government Bonds | 37,251 | 2,421,306 | 33,347 | 2,167,535 | 11.71 | % | |||||||||||||||||||||||
Mortgages | 174,436 | 10,989,473 | 162,542 | 10,402,677 | 7.32 | % | |||||||||||||||||||||||
Other Government Bonds | 7,104 | 444,954 | 4,544 | 284,767 | 56.36 | % | |||||||||||||||||||||||
Derivatives | 491,883 | 31,422,422 | 328,636 | 21,158,388 | 49.67 | % | |||||||||||||||||||||||
Swaps/Swaptions ≥ 1Y | 326,175 | 20,799,345 | 203,038 | 13,066,309 | 60.65 | % | |||||||||||||||||||||||
Swaps/Swaptions < 1Y | 163,393 | 10,476,689 | 123,817 | 7,978,143 | 31.96 | % | |||||||||||||||||||||||
Futures | 2,316 | 146,388 | 1,780 | 113,936 | 30.10 | % | |||||||||||||||||||||||
Total | 853,316 | 54,264,525 | 652,804 | 41,932,450 | 30.72 | % | |||||||||||||||||||||||
Credit | Cash | 12,981 | 824,984 | 9,300 | 597,520 | 39.58 | % | ||||||||||||||||||||||
U.S. High Grade - Fully Electronic | 4,225 | 266,163 | 3,293 | 210,757 | 28.29 | % | |||||||||||||||||||||||
U.S. High Grade - Electronically Processed | 2,339 | 147,359 | 2,475 | 158,411 | (5.50) | % | |||||||||||||||||||||||
U.S. High Yield - Fully Electronic | 610 | 38,455 | 463 | 29,622 | 31.88 | % | |||||||||||||||||||||||
U.S. High Yield - Electronically Processed | 217 | 13,668 | 351 | 22,482 | (38.24) | % | |||||||||||||||||||||||
European Credit | 1,869 | 121,475 | 1,390 | 90,371 | 34.42 | % | |||||||||||||||||||||||
Municipal Bonds | 334 | 21,054 | 354 | 22,673 | (5.67) | % | |||||||||||||||||||||||
Chinese Bonds | 3,231 | 206,794 | 863 | 56,068 | 274.59 | % | |||||||||||||||||||||||
Other Credit Bonds | 155 | 10,017 | 110 | 7,135 | 40.98 | % | |||||||||||||||||||||||
Derivatives | 16,955 | 1,081,813 | 20,020 | 1,289,959 | (15.31) | % | |||||||||||||||||||||||
Swaps | 16,955 | 1,081,813 | 20,020 | 1,289,959 | (15.31) | % | |||||||||||||||||||||||
Total | 29,936 | 1,906,796 | 29,320 | 1,887,479 | 2.10 | % | |||||||||||||||||||||||
Equities | Cash | 9,479 | 601,332 | 8,804 | 565,934 | 7.67 | % | ||||||||||||||||||||||
U.S. ETFs | 7,402 | 466,323 | 6,299 | 403,162 | 17.50 | % | |||||||||||||||||||||||
European ETFs | 2,077 | 135,009 | 2,504 | 162,772 | (17.06) | % | |||||||||||||||||||||||
Derivatives | 9,451 | 596,615 | 7,009 | 449,209 | 34.83 | % | |||||||||||||||||||||||
Convertibles/Swaps/Options | 6,285 | 396,969 | 4,384 | 281,007 | 43.35 | % | |||||||||||||||||||||||
Futures | 3,166 | 199,646 | 2,625 | 168,202 | 20.60 | % | |||||||||||||||||||||||
Total | 18,930 | 1,197,947 | 15,813 | 1,015,143 | 19.71 | % | |||||||||||||||||||||||
Money Markets | Cash | 522,075 | 33,065,896 | 400,726 | 25,721,492 | 30.28 | % | ||||||||||||||||||||||
Repurchase Agreements (Repo) | 505,191 | 32,000,195 | 382,040 | 24,525,135 | 32.24 | % | |||||||||||||||||||||||
Other Money Markets | 16,884 | 1,065,702 | 18,686 | 1,196,357 | (9.64) | % | |||||||||||||||||||||||
Total | 522,075 | 33,065,896 | 400,726 | 25,721,492 | 30.28 | % | |||||||||||||||||||||||
ADV (USD mm) | Volume (USD mm) | ADV (USD mm) | Volume (USD mm) | YoY | |||||||||||||||||||||||||
Total | 1,424,256 | 90,435,165 | 1,098,663 | 70,556,565 | 29.60 | % |
(1) |
Total volume across Rates (Cash and Derivatives), Credit and Money Markets include Australia and New Zealand estimated volumes from the Yieldbroker business that Tradeweb acquired on August 31, 2023. |