Tradeweb Reports Third Quarter 2024 Financial Results
Tradeweb Markets reported strong Q3 2024 financial results with record quarterly revenues of $448.9 million, up 36.7% year-over-year. The company achieved $2.2 trillion in average daily volume (ADV), representing a 55.3% increase from the previous year. Net income reached $130.2 million, up 16.7%, while adjusted net income grew 37.1% to $179.3 million. The company maintained a solid adjusted EBITDA margin of 53.4%. Notable achievements included quarterly ADV records in U.S. government bonds, fully electronic U.S. high yield credit, credit derivatives, and global repurchase agreements. The company declared a $0.10 per share quarterly dividend and repurchased $25.0 million worth of shares.
Tradeweb Markets ha riportato risultati finanziari eccellenti per il terzo trimestre del 2024, con entrate trimestrali record di 448,9 milioni di dollari, in aumento del 36,7% rispetto all'anno precedente. L'azienda ha raggiunto 2,2 trilioni di dollari in volume medio giornaliero (ADV), che rappresenta un aumento del 55,3% rispetto all'anno scorso. Il reddito netto ha raggiunto 130,2 milioni di dollari, in aumento del 16,7%, mentre il reddito netto rettificato è cresciuto del 37,1% fino a 179,3 milioni di dollari. L'azienda ha mantenuto un solido margine EBITDA rettificato del 53,4%. Tra i risultati significativi si annoverano i record trimestrali di ADV in obbligazioni governative statunitensi, credito high yield elettronico statunitense, derivati di credito e accordi di riacquisto globali. L'azienda ha dichiarato un dividendo trimestrale di 0,10 dollari per azione e ha riacquistato azioni per un valore di 25,0 milioni di dollari.
Tradeweb Markets informó resultados financieros sólidos para el tercer trimestre de 2024, con ingresos trimestrales récord de 448,9 millones de dólares, un aumento del 36,7% en comparación con el año anterior. La compañía logró 2,2 billones de dólares en volumen promedio diario (ADV), lo que representa un incremento del 55,3% respecto al año pasado. El ingreso neto alcanzó 130,2 millones de dólares, un aumento del 16,7%, mientras que el ingreso neto ajustado creció un 37,1% hasta 179,3 millones de dólares. La compañía mantuvo un sólido margen EBITDA ajustado del 53,4%. Logros notables incluyeron récords de ADV trimestrales en bonos del gobierno de EE.UU., crédito high yield completamente electrónico de EE.UU., derivados de crédito y acuerdos de recompra globales. La compañía declaró un dividendo trimestral de 0,10 dólares por acción y recompró acciones por un valor de 25,0 millones de dólares.
Tradeweb Markets는 2024년 3분기 강력한 재무 결과를 보고했으며, 분기별 수익이 4억 4,890만 달러로 작년 대비 36.7% 증가했습니다. 이 회사는 일일 평균 거래량(ADV)이 2.2조 달러에 달하며, 이는 작년 대비 55.3% 증가한 수치입니다. 순이익은 1억 3,020만 달러에 도달해 16.7% 증가했으며, 조정된 순이익은 37.1% 증가하여 1억 7,930만 달러를 기록했습니다. 이 회사는 53.4%의 견고한 조정 EBITDA 마진을 유지했습니다. 주목할 만한 성과로는 미국 정부 채권, 전자 거래된 미국 하이일드 신용, 신용 파생상품 및 글로벌 환매 계약에서의 분기별 ADV 기록이 포함됩니다. 이 회사는 주당 0.10달러의 분기 배당금을 선언하고 2,500만 달러 상당의 주식을 다시 매입했습니다.
Tradeweb Markets a annoncé de solides résultats financiers pour le troisième trimestre 2024, avec des revenus trimestriels record de 448,9 millions de dollars, en hausse de 36,7% par rapport à l'année précédente. L'entreprise a atteint 2,2 trillions de dollars en volume quotidien moyen (ADV), représentant une augmentation de 55,3% par rapport à l'année précédente. Le revenu net a atteint 130,2 millions de dollars, en hausse de 16,7%, tandis que le revenu net ajusté a crû de 37,1% pour atteindre 179,3 millions de dollars. L'entreprise a maintenu une solide marge EBITDA ajustée de 53,4%. Parmi les réalisations notables figuraient des records d'ADV trimestriels dans les obligations gouvernementales américaines, le crédit à haut rendement entièrement électronique aux États-Unis, les dérivés de crédit et les accords de rachat mondiaux. L'entreprise a déclaré un dividende trimestriel de 0,10 dollar par action et a racheté pour 25,0 millions de dollars d'actions.
Tradeweb Markets hat starke Finanzzahlen für das 3. Quartal 2024 veröffentlicht, mit einem Rekordquartalsumsatz von 448,9 Millionen Dollar, was einem Anstieg von 36,7% im Vergleich zum Vorjahr entspricht. Das Unternehmen erreichte 2,2 Billionen Dollar im durchschnittlichen täglichen Volumen (ADV), was einen Anstieg von 55,3% im Vorjahresvergleich darstellt. Der Nettogewinn belief sich auf 130,2 Millionen Dollar, was einem Anstieg von 16,7% entspricht, während der bereinigte Nettogewinn um 37,1% auf 179,3 Millionen Dollar wuchs. Das Unternehmen hielt eine solide bereinigte EBITDA-Marge von 53,4%. Zu den bemerkenswerten Erfolgen gehörten Rekorde bei ADV in US-Staatsanleihen, vollständig elektronischen US-Hochzinsanleihen, Kreditderivaten und globalen Rückkaufsvereinbarungen. Das Unternehmen erklärte eine vierteljährliche Dividende von 0,10 Dollar pro Aktie und kaufte Aktien im Wert von 25,0 Millionen Dollar zurück.
- Record quarterly revenue of $448.9 million (+36.7% YoY)
- Record ADV of $2.2 trillion (+55.3% YoY)
- Net income increased 16.7% to $130.2 million
- Adjusted EBITDA margin improved to 53.4% from 51.9%
- Strong growth across all major segments: Rates (+34.9%), Credit (+31.4%), Equities (+22.1%), Money Markets (+129.2%)
- Successful integration of ICD acquisition expanding into corporate treasury market
- Net income margin decreased by 499 basis points to 29.0% from 34.0%
- Operating expenses increased 42.2% to $289.6 million
- Share of fully electronic U.S. high yield TRACE declined 3 basis points
Insights
A stellar quarter with
Key highlights include record U.S. government bond volumes and breakthrough electronic trading adoption in credit markets, reaching
Strong operational leverage is evident with revenue growth outpacing expense growth. The
The surge in trading volumes reflects broader market trends toward electronic trading adoption and increased market volatility. Notable strength in rates trading, with
Geographic expansion into India and enhanced presence in Asia shows strategic focus on high-growth markets. The integration of ICD adds a valuable corporate treasury client segment, diversifying revenue streams. The FTSE Russell partnership for benchmark pricing further cements Tradeweb's market infrastructure position.
Billy Hult, CEO of Tradeweb:
“We are pleased to report record quarterly revenues of
Throughout the quarter, we worked closely with clients as they navigated a remarkable period of macroeconomic uncertainty and rates volatility. In
Looking ahead, we remain focused on identifying strategic growth opportunities and further expanding our presence across key markets.”
SELECT FINANCIAL RESULTS |
|
3Q24 |
|
|
|
3Q23 |
|
|
Change |
|
Constant Currency Change(1) |
|||
(dollars in thousands except per share amounts)(Unaudited) |
||||||||||||||
GAAP Financial Measures |
||||||||||||||
Total revenue |
$ |
448,915 |
|
$ |
328,357 |
|
36.7 |
% |
36.5 |
% |
||||
Rates |
$ |
233,122 |
|
$ |
172,832 |
|
34.9 |
% |
34.7 |
% |
||||
Credit |
$ |
118,305 |
|
$ |
90,062 |
|
31.4 |
% |
31.3 |
% |
||||
Equities |
$ |
25,514 |
|
$ |
20,890 |
|
22.1 |
% |
22.0 |
% |
||||
Money Markets |
$ |
36,126 |
|
$ |
15,763 |
|
129.2 |
% |
128.2 |
% |
||||
Market Data |
$ |
29,760 |
|
$ |
22,956 |
|
29.6 |
% |
29.2 |
% |
||||
Other |
$ |
6,088 |
|
$ |
5,854 |
|
4.0 |
% |
4.0 |
% |
||||
Net income |
$ |
130,223 |
|
$ |
111,630 |
|
16.7 |
% |
|
|
||||
Net income attributable to Tradeweb Markets Inc.(2) | $ |
113,916 |
|
$ |
98,614 |
|
15.5 |
% | ||||||
Diluted EPS |
$ |
0.53 |
|
$ |
0.46 |
|
15.2 |
% |
|
|
||||
Net income margin |
|
29.0 |
% |
|
34.0 |
% |
-499 |
bps |
|
|
||||
Non-GAAP Financial Measures |
||||||||||||||
Adjusted EBITDA(1) |
$ |
239,816 |
|
$ |
170,360 |
|
40.8 |
% |
39.2 |
% |
||||
Adjusted EBITDA margin(1) |
|
53.4 |
% |
|
51.9 |
% |
+154 |
bps |
+102 |
bps |
||||
Adjusted EBIT(1) |
$ |
223,893 |
|
$ |
155,772 |
|
43.7 |
% |
41.9 |
% |
||||
Adjusted EBIT margin(1) |
|
49.9 |
% |
|
47.4 |
% |
+243 |
bps |
+192 |
bps |
||||
Adjusted Net Income(1) |
$ |
179,332 |
|
$ |
130,794 |
|
37.1 |
% |
35.6 |
% |
||||
Adjusted Diluted EPS(1) |
$ |
0.75 |
|
$ |
0.55 |
|
36.4 |
% |
33.9 |
% |
(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. |
ADV (US $bn) (Unaudited) |
||||||||||
Asset Class |
Product |
|
3Q24 |
|
3Q23 |
YoY |
||||
Rates |
Cash |
$ |
497 |
$ |
361 |
|
||||
|
Derivatives |
|
802 |
|
492 |
|
||||
|
Total |
|
1,298 |
|
853 |
|
||||
Credit |
Cash |
|
15 |
|
13 |
|
||||
|
Derivatives |
|
27 |
|
17 |
|
||||
|
Total |
|
43 |
|
30 |
|
||||
Equities |
Cash |
|
10 |
|
9 |
|
||||
|
Derivatives |
|
13 |
|
9 |
|
||||
|
Total |
|
23 |
|
19 |
|
||||
Money Markets |
Cash |
|
848 |
|
522 |
|
||||
|
Total |
|
848 |
|
522 |
|
||||
|
Total |
$ |
2,212 |
$ |
1,424 |
|
DISCUSSION OF RESULTS
Rates – Revenues of
Credit – Revenues of
Equities – Revenues of
Money Markets – Revenues of
Market Data – Revenues of
Other – Revenues of
Operating Expenses of
Adjusted Expenses of
RECENT HIGHLIGHTS
October 2024
-
FTSE Russell to incorporate a price source change to include Tradeweb FTSE benchmark closing prices for
U.S Treasuries, European Government Bonds andUK Gilts in FTSE’s global fixed income indices, including its premiere World Government Bond Index (WGBI). -
Commemorated the 10-year anniversary of the launch of our
U.S. Credit Platform. - Recognized as Multi-Asset Trading System of the Year - Asia Pacific Awards (FOW) and 100 Women in European Finance - Nawel Khelil (Financial News)
Third Quarter 2024
- Announced the addition of Daniel Maguire to Tradeweb's Board of Directors, effective as of September 18, 2024.
-
Appointed Maxlin Thomas as Head of
India as part of our efforts to further strengthen our global presence. - Completed Tradeweb's acquisition of Institutional Cash Distributors (“ICD”), an investment technology provider for corporate treasury organizations trading short-term investments, adding corporates as a fourth client channel, alongside our existing focus on institutional, wholesale and retail clients.
- Published our fourth annual Corporate Sustainability Report and our second annual standalone Task Force on Climate-Related Financial Disclosure (TCFD) Report.
- Executed the first fully-automated European Government Bond Basis trade, in collaboration with Eurex, with Nomura providing liquidity to Nykredit Bank.
-
In June 2024, we signed a 16-year lease for our new NYC headquarters, which is expected to commence in July 2025. Including expected double rent from our existing NYC office and other anticipated leasing activity in the second half of 2025, we expect our second half 2025 occupancy expenses to be approximately
higher than the second half of 2024.$7 million - Recognized in numerous awards celebrating our company, as well as our outstanding and diverse talent, including: Best Company - Markets Choice Awards (Markets Media); Best Sustainable Companies to Own (Morningstar); Most Influential in European Finance - Enrico Bruni (Financial News); Rising Star - Allie Hunt (Women in Financial Markets); European Women in Finance Awards - Excellence in Trading Platforms - Alessandra Stagliano (Markets Media)
CAPITAL MANAGEMENT
-
in cash and cash equivalents and an undrawn$1.2 billion credit facility at September 30, 2024$500 million -
As purchase consideration for the August 1, 2024 acquisition of ICD, we paid
in net cash and also issued 41,705 shares of restricted Class A common stock in connection with the acquisition$771.2 million -
Free cash flow for the trailing twelve months ended September 30, 2024 of
, up$797.4 million 23.6% compared to prior year period. See “Non-GAAP Financial Measures” for additional information -
Cash capital expenditures and capitalized software development in the third quarter 2024 of
(excludes amounts paid at closing for acquisitions)$17.0 million -
During the third quarter of 2024, as part of its share repurchase program, Tradeweb purchased 214,795 shares of Class A common stock, at an average price of
, for purchases totaling$116.41 .$25.0 million remained available for repurchase pursuant to the share repurchase program authorization as of September 30, 2024$214.8 million -
in shares of Class A common stock were withheld in the third quarter of 2024 to satisfy tax obligations related to the exercise of stock options and vesting of restricted stock units and performance-based restricted stock units held by employees$2.1 million -
The Board declared a quarterly cash dividend of
per share of Class A common stock and Class B common stock. The dividend will be payable on December 16, 2024 to stockholders of record as of December 2, 2024$0.10
OTHER MATTERS
Updated Full-Year 2024 Guidance*
-
Adjusted Expenses:
- 875 million (trending toward middle of range)$855 -
Acquisition and Refinitiv Transaction related depreciation and amortization expense:
$158 million -
Assumed non-GAAP tax rate: ~
24.5% -25.5% -
Cash capital expenditures and capitalized software development: ~
- 85 million$77 -
LSEG Market Data Contract Revenue:
~ ($80 million ~ in 2025)$90 million
The guidance has been revised to reflect higher adjusted expenses in light of strong business momentum. Depreciation and amortization, assumed non-GAAP tax rate, expenditures and LSEG Market Data Contract Revenue guidance is unchanged from the prior quarter guidance.
*GAAP operating expenses and tax rate guidance are not provided due to the inherent difficulty in quantifying certain amounts due to a variety of factors including the unpredictability in the movement of foreign currency rates. Expense guidance assumes an average 2024 Sterling/US$ foreign exchange rate of 1.24 and includes completed M&A transactions. Guidance amounts for cash capital expenditures and capitalized software development excludes amounts paid at closing for acquisitions.
CONFERENCE CALL
Tradeweb Markets will hold a conference call to discuss third quarter 2024 results starting at 9:30 AM EDT today, October 30, 2024. A live, audio webcast of the conference call along with related presentation materials will be available at https://investors.tradeweb.com/events-and-presentations.
- To join the call via audio webcast, click here: https://edge.media-server.com/mmc/p/8fmfndxv/
- To join the call via phone, please register in advance here: https://register.vevent.com/register/BI7f65d6e977a04267a4a86c5cf7eef76f. Registered participants will receive an email confirmation with a unique PIN to access the conference call.
An archived recording of the call will be available afterward at https://investors.tradeweb.com.
ABOUT TRADEWEB MARKETS
Tradeweb Markets Inc. (Nasdaq: TW) is a leading, global operator of electronic marketplaces for rates, credit, equities and money markets. Founded in 1996, Tradeweb provides access to markets, data and analytics, electronic trading, straight-through-processing and reporting for more than 50 products to clients in the institutional, wholesale and retail markets. Advanced technologies developed by Tradeweb enhance price discovery, order execution and trade workflows while allowing for greater scale and helping to reduce risks in client trading operations. Tradeweb serves more than 2,800 clients in more than 70 countries. On average, Tradeweb facilitated more than
TRADEWEB MARKETS INC. CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) |
||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
|
September 30, |
|
September 30, |
||||||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Revenues |
(dollars in thousands, except per share amounts) |
|||||||||||||||
Transaction fees and commissions |
|
$ |
373,493 |
|
|
$ |
263,485 |
|
|
$ |
1,039,419 |
|
|
$ |
776,544 |
|
Subscription fees |
|
|
51,206 |
|
|
|
46,361 |
|
|
|
151,633 |
|
|
|
136,483 |
|
LSEG market data fees |
|
|
20,512 |
|
|
|
15,460 |
|
|
|
61,593 |
|
|
|
46,515 |
|
Other |
|
|
3,704 |
|
|
|
3,051 |
|
|
|
9,960 |
|
|
|
8,677 |
|
Total revenue |
|
|
448,915 |
|
|
|
328,357 |
|
|
|
1,262,605 |
|
|
|
968,219 |
|
|
|
|
|
|
|
|
|
|
||||||||
Expenses |
|
|
|
|
|
|
|
|
||||||||
Employee compensation and benefits |
|
|
160,161 |
|
|
|
116,016 |
|
|
|
440,484 |
|
|
|
334,433 |
|
Depreciation and amortization |
|
|
57,872 |
|
|
|
46,559 |
|
|
|
157,145 |
|
|
|
137,850 |
|
Technology and communications |
|
|
24,300 |
|
|
|
19,733 |
|
|
|
69,840 |
|
|
|
56,001 |
|
General and administrative |
|
|
20,417 |
|
|
|
6,700 |
|
|
|
44,026 |
|
|
|
31,692 |
|
Professional fees |
|
|
21,434 |
|
|
|
10,479 |
|
|
|
46,558 |
|
|
|
32,321 |
|
Occupancy |
|
|
5,415 |
|
|
|
4,132 |
|
|
|
15,064 |
|
|
|
12,283 |
|
Total expenses |
|
|
289,599 |
|
|
|
203,619 |
|
|
|
773,117 |
|
|
|
604,580 |
|
Operating income |
|
|
159,316 |
|
|
|
124,738 |
|
|
|
489,488 |
|
|
|
363,639 |
|
Tax receivable agreement liability adjustment |
|
|
(870 |
) |
|
|
— |
|
|
|
(870 |
) |
|
|
— |
|
Interest income |
|
|
16,663 |
|
|
|
17,929 |
|
|
|
59,234 |
|
|
|
46,445 |
|
Interest expense |
|
|
(1,446 |
) |
|
|
(464 |
) |
|
|
(3,706 |
) |
|
|
(1,380 |
) |
Other income (loss), net |
|
|
10 |
|
|
|
(1,907 |
) |
|
|
10 |
|
|
|
(2,022 |
) |
Income before taxes |
|
|
173,673 |
|
|
|
140,296 |
|
|
|
544,156 |
|
|
|
406,682 |
|
Provision for income taxes |
|
|
(43,450 |
) |
|
|
(28,666 |
) |
|
|
(134,135 |
) |
|
|
(90,920 |
) |
Net income |
|
|
130,223 |
|
|
|
111,630 |
|
|
|
410,021 |
|
|
|
315,762 |
|
Less: Net income attributable to non-controlling interests |
|
|
16,307 |
|
|
|
13,016 |
|
|
|
50,724 |
|
|
|
40,210 |
|
Net income attributable to Tradeweb Markets Inc. |
|
$ |
113,916 |
|
|
$ |
98,614 |
|
|
$ |
359,297 |
|
|
$ |
275,552 |
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share attributable to Tradeweb Markets Inc. Class A and B common stockholders: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
$ |
0.53 |
|
|
$ |
0.47 |
|
|
$ |
1.69 |
|
|
$ |
1.31 |
|
Diluted |
|
$ |
0.53 |
|
|
$ |
0.46 |
|
|
$ |
1.67 |
|
|
$ |
1.30 |
|
Weighted average shares outstanding: |
|
|
|
|
|
|
|
|
||||||||
Basic |
|
|
213,206,193 |
|
|
|
211,618,475 |
|
|
|
213,026,732 |
|
|
|
210,444,082 |
|
Diluted |
|
|
215,096,974 |
|
|
|
213,491,634 |
|
|
|
214,885,210 |
|
|
|
212,276,908 |
|
TRADEWEB MARKETS INC. RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED) |
||||||||||||||||
|
|
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, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
(dollars in thousands) |
||||||||||||||
Net income |
|
$ |
130,223 |
|
|
$ |
111,630 |
|
|
$ |
410,021 |
|
|
$ |
315,762 |
|
Merger and acquisition transaction and integration costs(1) |
|
|
14,488 |
|
|
|
4,614 |
|
|
|
21,752 |
|
|
|
6,411 |
|
Interest income |
|
|
(16,663 |
) |
|
|
(17,929 |
) |
|
|
(59,234 |
) |
|
|
(46,445 |
) |
Interest expense |
|
|
1,446 |
|
|
|
464 |
|
|
|
3,706 |
|
|
|
1,380 |
|
Depreciation and amortization |
|
|
57,872 |
|
|
|
46,559 |
|
|
|
157,145 |
|
|
|
137,850 |
|
Stock-based compensation expense(2) |
|
|
3,681 |
|
|
|
525 |
|
|
|
5,395 |
|
|
|
1,960 |
|
Provision for income taxes |
|
|
43,450 |
|
|
|
28,666 |
|
|
|
134,135 |
|
|
|
90,920 |
|
Foreign exchange (gains) / losses(3) |
|
|
4,459 |
|
|
|
(6,076 |
) |
|
|
2,097 |
|
|
|
(4,242 |
) |
Tax receivable agreement liability adjustment(4) |
|
|
870 |
|
|
|
— |
|
|
|
870 |
|
|
|
— |
|
Other (income) loss, net |
|
|
(10 |
) |
|
|
1,907 |
|
|
|
(10 |
) |
|
|
2,022 |
|
Adjusted EBITDA |
|
$ |
239,816 |
|
|
$ |
170,360 |
|
|
$ |
675,877 |
|
|
$ |
505,618 |
|
Less: Depreciation and amortization |
|
|
(57,872 |
) |
|
|
(46,559 |
) |
|
|
(157,145 |
) |
|
|
(137,850 |
) |
Add: D&A related to acquisitions and the Refinitiv Transaction(5) |
|
|
41,949 |
|
|
|
31,971 |
|
|
|
111,031 |
|
|
|
95,217 |
|
Adjusted EBIT |
|
$ |
223,893 |
|
|
$ |
155,772 |
|
|
$ |
629,763 |
|
|
$ |
462,985 |
|
Net income margin(6) |
|
|
29.0 |
% |
|
|
34.0 |
% |
|
|
32.5 |
% |
|
|
32.6 |
% |
Adjusted EBITDA margin(6) |
|
|
53.4 |
% |
|
|
51.9 |
% |
|
|
53.5 |
% |
|
|
52.2 |
% |
Adjusted EBIT margin(6) |
|
|
49.9 |
% |
|
|
47.4 |
% |
|
|
49.9 |
% |
|
|
47.8 |
% |
(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 certain other transaction expenses and 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, 2024, this adjustment also includes |
(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, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
(dollars in thousands, except per share amounts) |
||||||||||||||
Earnings per diluted share |
|
$ |
0.53 |
|
|
$ |
0.46 |
|
|
$ |
1.67 |
|
|
$ |
1.30 |
|
Net income attributable to Tradeweb Markets Inc. |
|
$ |
113,916 |
|
|
$ |
98,614 |
|
|
$ |
359,297 |
|
|
$ |
275,552 |
|
Net income attributable to non-controlling interests(1) |
|
|
16,307 |
|
|
|
13,016 |
|
|
|
50,724 |
|
|
|
40,210 |
|
Net income |
|
|
130,223 |
|
|
|
111,630 |
|
|
|
410,021 |
|
|
|
315,762 |
|
Provision for income taxes |
|
|
43,450 |
|
|
|
28,666 |
|
|
|
134,135 |
|
|
|
90,920 |
|
Merger and acquisition transaction and integration costs(2) |
|
|
14,488 |
|
|
|
4,614 |
|
|
|
21,752 |
|
|
|
6,411 |
|
D&A related to acquisitions and the Refinitiv Transaction(3) |
|
|
41,949 |
|
|
|
31,971 |
|
|
|
111,031 |
|
|
|
95,217 |
|
Stock-based compensation expense(4) |
|
|
3,681 |
|
|
|
525 |
|
|
|
5,395 |
|
|
|
1,960 |
|
Foreign exchange (gains) / losses(5) |
|
|
4,459 |
|
|
|
(6,076 |
) |
|
|
2,097 |
|
|
|
(4,242 |
) |
Tax receivable agreement liability adjustment(6) |
|
|
870 |
|
|
|
— |
|
|
|
870 |
|
|
|
— |
|
Other (income) loss, net |
|
|
(10 |
) |
|
|
1,907 |
|
|
|
(10 |
) |
|
|
2,022 |
|
Adjusted Net Income before income taxes |
|
|
239,110 |
|
|
|
173,237 |
|
|
|
685,291 |
|
|
|
508,050 |
|
Adjusted income taxes(7) |
|
|
(59,778 |
) |
|
|
(42,443 |
) |
|
|
(171,323 |
) |
|
|
(124,472 |
) |
Adjusted Net Income |
|
$ |
179,332 |
|
|
$ |
130,794 |
|
|
$ |
513,968 |
|
|
$ |
383,578 |
|
Adjusted Diluted EPS(8) |
|
$ |
0.75 |
|
|
$ |
0.55 |
|
|
$ |
2.16 |
|
|
$ |
1.62 |
|
(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 certain other transaction expenses and 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, 2024, this adjustment also includes |
(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 |
(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. |
The following table summarizes the calculation of Adjusted Diluted EPS for the periods presented:
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, |
|||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
Diluted weighted average shares of Class A and Class B common stock outstanding |
|
|
215,096,974 |
|
|
213,491,634 |
|
|
214,885,210 |
|
|
212,276,908 |
Weighted average of other participating securities(1) |
|
|
126,903 |
|
|
265,681 |
|
|
137,252 |
|
|
266,453 |
Assumed exchange of LLC Interests for shares of Class A or Class B common stock(2) |
|
|
23,076,235 |
|
|
23,080,571 |
|
|
23,077,298 |
|
|
24,179,583 |
Adjusted diluted weighted average shares outstanding |
|
|
238,300,112 |
|
|
236,837,886 |
|
|
238,099,760 |
|
|
236,722,944 |
Adjusted Net Income (in thousands) |
|
$ |
179,332 |
|
$ |
130,794 |
|
$ |
513,968 |
|
$ |
383,578 |
Adjusted Diluted EPS |
|
$ |
0.75 |
|
$ |
0.55 |
|
$ |
2.16 |
|
$ |
1.62 |
(1) |
|
Represents the weighted average of unvested stock awards and unsettled vested stock awards 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, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
|
(dollars in thousands) |
||||||||||||||
Operating expenses |
|
$ |
289,599 |
|
|
$ |
203,619 |
|
|
$ |
773,117 |
|
|
$ |
604,580 |
|
Merger and acquisition transaction and integration costs(1) |
|
|
(14,488 |
) |
|
|
(4,614 |
) |
|
|
(21,752 |
) |
|
|
(6,411 |
) |
D&A related to acquisitions and the Refinitiv Transaction(2) |
|
|
(41,949 |
) |
|
|
(31,971 |
) |
|
|
(111,031 |
) |
|
|
(95,217 |
) |
Stock-based compensation expense(3) |
|
|
(3,681 |
) |
|
|
(525 |
) |
|
|
(5,395 |
) |
|
|
(1,960 |
) |
Foreign exchange gains / (losses)(4) |
|
|
(4,459 |
) |
|
|
6,076 |
|
|
|
(2,097 |
) |
|
|
4,242 |
|
Adjusted Expenses |
|
$ |
225,022 |
|
|
$ |
172,585 |
|
|
$ |
632,842 |
|
|
$ |
505,234 |
|
(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 certain other transaction expenses and 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, 2024, this adjustment also includes |
(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 |
|
|
2024 |
|
|
|
2023 |
|
|
|
(dollars in thousands) |
||||||
Cash flow from operating activities |
|
$ |
860,477 |
|
|
$ |
709,328 |
|
Less: Capitalization of software development costs |
|
|
(46,312 |
) |
|
|
(41,517 |
) |
Less: Purchases of furniture, equipment and leasehold improvements |
|
|
(16,791 |
) |
|
|
(22,722 |
) |
Free Cash Flow |
|
$ |
797,374 |
|
|
$ |
645,089 |
|
TRADEWEB MARKETS INC.
|
||||||||||||||||
The following table summarizes the basic and diluted earnings per share calculations for Tradeweb Markets Inc.: |
||||||||||||||||
|
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
EPS: Net income attributable to Tradeweb Markets Inc. |
|
September 30, |
|
September 30, |
||||||||||||
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
|
|
(dollars in thousands, except per share amounts) |
|||||||||||||||
Numerator: |
|
|
|
|
|
|
|
|
||||||||
Net income attributable to Tradeweb Markets Inc. |
|
$ |
113,916 |
|
|
$ |
98,614 |
|
|
$ |
359,297 |
|
|
$ |
275,552 |
|
Less: Distributed and undistributed earnings allocated to participating securities(1) |
|
|
(68 |
) |
|
|
(124 |
) |
|
|
(231 |
) |
|
|
(348 |
) |
Net income attributable to outstanding shares of Class A and Class B common stock - Basic and Diluted |
|
$ |
113,848 |
|
|
$ |
98,490 |
|
|
$ |
359,066 |
|
|
$ |
275,204 |
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator: |
|
|
|
|
|
|
|
|
||||||||
Weighted average shares of Class A and Class B common stock outstanding - Basic |
|
|
213,206,193 |
|
|
|
211,618,475 |
|
|
|
213,026,732 |
|
|
|
210,444,082 |
|
Dilutive effect of PRSUs |
|
|
625,822 |
|
|
|
504,945 |
|
|
|
564,996 |
|
|
|
380,740 |
|
Dilutive effect of options |
|
|
363,623 |
|
|
|
1,110,175 |
|
|
|
470,816 |
|
|
|
1,240,923 |
|
Dilutive effect of RSUs and RSAs |
|
|
405,562 |
|
|
|
258,039 |
|
|
|
367,375 |
|
|
|
211,163 |
|
Dilutive effect of PSUs |
|
|
495,774 |
|
|
|
— |
|
|
|
455,291 |
|
|
|
— |
|
Weighted average shares of Class A and Class B common stock outstanding - Diluted |
|
|
215,096,974 |
|
|
|
213,491,634 |
|
|
|
214,885,210 |
|
|
|
212,276,908 |
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings per share - Basic |
|
$ |
0.53 |
|
|
$ |
0.47 |
|
|
$ |
1.69 |
|
|
$ |
1.31 |
|
Earnings per share - Diluted |
|
$ |
0.53 |
|
|
$ |
0.46 |
|
|
$ |
1.67 |
|
|
$ |
1.30 |
|
(1) |
|
During the three months ended September 30, 2024 and 2023, there was a total of 126,903 and 265,681, respectively, and during the nine months ended September 30, 2024 and 2023, there was a total of 137,252 and 266,453, respectively, weighted average unvested or unsettled vested stock awards that were considered a participating security for purposes of calculating earnings per share in accordance with the two-class method. |
TRADEWEB MARKETS INC. REVENUES BY ASSET CLASS (UNAUDITED) |
||||||||||||||||||||||||||
|
|
Three Months Ended |
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
September 30, |
|
|
|
|
||||||||||||||||||||
|
|
2024 |
|
2023 |
|
$ Change |
|
% Change |
||||||||||||||||||
Revenues |
|
Variable |
|
Fixed |
|
Variable |
|
Fixed |
|
Variable |
|
Fixed |
|
Variable |
|
Fixed |
||||||||||
|
|
(dollars in thousands) |
||||||||||||||||||||||||
Rates |
|
$ |
173,698 |
|
$ |
59,424 |
|
$ |
114,128 |
|
$ |
58,704 |
|
$ |
59,570 |
|
|
$ |
720 |
|
|
52.2 |
% |
|
1.2 |
% |
Credit |
|
|
109,518 |
|
|
8,787 |
|
|
82,484 |
|
|
7,578 |
|
|
27,034 |
|
|
|
1,209 |
|
|
32.8 |
% |
|
16.0 |
% |
Equities |
|
|
23,218 |
|
|
2,296 |
|
|
18,567 |
|
|
2,323 |
|
|
4,651 |
|
|
|
(27 |
) |
|
25.0 |
% |
|
(1.2 |
)% |
Money Markets |
|
|
31,928 |
|
|
4,198 |
|
|
11,433 |
|
|
4,330 |
|
|
20,495 |
|
|
|
(132 |
) |
|
179.3 |
% |
|
(3.0 |
)% |
Market Data |
|
|
104 |
|
|
29,656 |
|
|
115 |
|
|
22,841 |
|
|
(11 |
) |
|
|
6,815 |
|
|
(9.6 |
)% |
|
29.8 |
% |
Other |
|
|
513 |
|
|
5,575 |
|
|
— |
|
|
5,854 |
|
|
513 |
|
|
|
(279 |
) |
|
N/M |
|
|
(4.8 |
)% |
Total revenue |
|
$ |
338,979 |
|
$ |
109,936 |
|
$ |
226,727 |
|
$ |
101,630 |
|
$ |
112,252 |
|
|
$ |
8,306 |
|
|
49.5 |
% |
|
8.2 |
% |
N/M = not meaningful |
TRADEWEB MARKETS INC. AVERAGE VARIABLE FEES PER MILLION DOLLARS OF VOLUME (UNAUDITED) |
|||||||||
|
|
Three Months Ended |
|
|
|||||
|
|
September 30, |
|
YoY |
|||||
|
|
2024 |
|
2023 |
|
% Change |
|||
Rates |
|
$ |
2.07 |
|
$ |
2.10 |
|
(1.4 |
)% |
Rates Cash |
|
$ |
2.45 |
|
$ |
2.42 |
|
1.1 |
% |
Rates Derivatives |
|
$ |
1.85 |
|
$ |
1.87 |
|
(1.5 |
)% |
Rates Derivatives (greater than 1 year) |
|
$ |
3.19 |
|
$ |
2.72 |
|
17.2 |
% |
Other Rates Derivatives(1) |
|
$ |
0.22 |
|
$ |
0.22 |
|
1.1 |
% |
|
|
|
|
|
|
|
|||
Credit |
|
$ |
39.76 |
|
$ |
43.26 |
|
(8.1 |
)% |
Cash Credit(2) |
|
$ |
151.90 |
|
$ |
162.20 |
|
(6.3 |
)% |
Credit Derivatives, China Bonds and |
|
$ |
5.71 |
|
$ |
5.75 |
|
(0.7 |
)% |
|
|
|
|
|
|
|
|||
Equities |
|
$ |
15.82 |
|
$ |
15.50 |
|
2.1 |
% |
Equities Cash |
|
$ |
27.68 |
|
$ |
25.42 |
|
8.9 |
% |
Equities Derivatives |
|
$ |
5.99 |
|
$ |
5.50 |
|
9.0 |
% |
|
|
|
|
|
|
|
|||
Money Markets |
|
$ |
0.54 |
|
$ |
0.35 |
|
55.0 |
% |
|
|
|
|
|
|
|
|||
Total |
|
$ |
2.29 |
|
$ |
2.51 |
|
(8.5 |
)% |
Total excluding Other Rates Derivatives(3) |
|
$ |
2.69 |
|
$ |
2.81 |
|
(4.4 |
)% |
(1) |
|
Includes Swaps/Swaptions of tenor less than 1 year and Rates Futures. |
(2) |
|
The “Cash Credit” category represents the “Credit” asset class excluding (1) Credit Derivatives (2) China Bonds and (3) |
(3) |
|
Included to contextualize the impact of short-tenored Swaps/Swaptions and Rates Futures on totals for all periods presented. |
TRADEWEB MARKETS INC. AVERAGE DAILY VOLUME (UNAUDITED)(1) |
|||||||||||||||||
|
|
|
2024 Q3 |
|
2023 Q3 |
|
YoY |
||||||||||
Asset Class |
Product |
|
ADV (USD mm) |
|
Volume (USD mm) |
|
ADV (USD mm) |
|
Volume (USD mm) |
|
ADV |
||||||
Rates |
Cash |
|
$ |
496,603 |
$ |
31,860,816 |
|
$ |
361,421 |
$ |
22,842,103 |
|
37.40 |
% |
|||
|
|
|
|
221,864 |
|
14,199,309 |
|
|
142,641 |
|
8,986,371 |
|
55.54 |
% |
|||
|
European Government Bonds |
|
|
42,964 |
|
2,835,614 |
|
|
37,251 |
|
2,421,306 |
|
15.34 |
% |
|||
|
Mortgages |
|
|
221,999 |
|
14,207,950 |
|
|
174,436 |
|
10,989,473 |
|
27.27 |
% |
|||
|
Other Government Bonds |
|
|
9,775 |
|
617,943 |
|
|
7,093 |
|
444,954 |
|
37.82 |
% |
|||
|
Derivatives |
|
|
801,512 |
|
51,882,416 |
|
|
491,837 |
|
31,422,421 |
|
62.96 |
% |
|||
|
Swaps/Swaptions ≥ 1Y |
|
|
439,683 |
|
28,436,368 |
|
|
325,350 |
|
20,746,985 |
|
35.14 |
% |
|||
|
Swaps/Swaptions < 1Y |
|
|
352,589 |
|
22,850,905 |
|
|
164,178 |
|
10,529,049 |
|
114.76 |
% |
|||
|
Futures |
|
|
9,239 |
|
595,143 |
|
|
2,310 |
|
146,388 |
|
300.01 |
% |
|||
|
Total |
|
|
1,298,114 |
|
83,743,233 |
|
|
853,258 |
|
54,264,524 |
|
52.14 |
% |
|||
Credit |
Cash |
|
|
15,251 |
|
980,526 |
|
|
12,980 |
|
824,984 |
|
17.49 |
% |
|||
|
|
|
|
6,433 |
|
411,704 |
|
|
4,228 |
|
266,368 |
|
52.15 |
% |
|||
|
|
|
2,649 |
|
169,509 |
|
|
2,339 |
|
147,359 |
|
13.23 |
% |
||||
|
|
|
|
775 |
|
49,578 |
|
|
611 |
|
38,465 |
|
26.88 |
% |
|||
|
|
|
|
276 |
|
17,679 |
|
|
217 |
|
13,668 |
|
27.33 |
% |
|||
|
European Credit |
|
|
2,092 |
|
138,095 |
|
|
1,869 |
|
121,475 |
|
11.96 |
% |
|||
|
Municipal Bonds |
|
|
380 |
|
24,300 |
|
|
334 |
|
21,054 |
|
13.62 |
% |
|||
|
Chinese Bonds |
|
|
2,371 |
|
151,721 |
|
|
3,231 |
|
206,794 |
|
(26.63 |
)% |
|||
|
Other Credit Bonds |
|
|
276 |
|
17,939 |
|
|
152 |
|
9,802 |
|
81.69 |
% |
|||
|
Derivatives |
|
|
27,338 |
|
1,773,907 |
|
|
16,955 |
|
1,081,813 |
|
61.24 |
% |
|||
|
Swaps |
|
|
27,338 |
|
1,773,907 |
|
|
16,955 |
|
1,081,813 |
|
61.24 |
% |
|||
|
Total |
|
|
42,589 |
|
2,754,433 |
|
|
29,936 |
|
1,906,796 |
|
42.27 |
% |
|||
Equities |
Cash |
|
|
10,308 |
|
665,138 |
|
|
9,475 |
|
601,081 |
|
8.79 |
% |
|||
|
|
|
|
7,608 |
|
486,909 |
|
|
7,402 |
|
466,323 |
|
2.78 |
% |
|||
|
European ETFs |
|
|
2,700 |
|
178,229 |
|
|
2,073 |
|
134,758 |
|
30.25 |
% |
|||
|
Derivatives |
|
|
12,507 |
|
802,100 |
|
|
9,451 |
|
596,615 |
|
32.33 |
% |
|||
|
Convertibles/Swaps/Options |
|
|
9,279 |
|
595,271 |
|
|
6,285 |
|
396,969 |
|
47.63 |
% |
|||
|
Futures |
|
|
3,228 |
|
206,829 |
|
|
3,166 |
|
199,646 |
|
1.97 |
% |
|||
|
Total |
|
|
22,815 |
|
1,467,238 |
|
|
18,926 |
|
1,197,696 |
|
20.55 |
% |
|||
Money Markets |
Cash |
|
|
848,171 |
|
59,556,275 |
|
|
522,065 |
|
33,065,896 |
|
62.46 |
% |
|||
|
Repurchase Agreements (Repo) |
|
|
647,745 |
|
41,687,516 |
|
|
505,191 |
|
32,000,195 |
|
28.22 |
% |
|||
|
Other Money Markets |
|
|
200,427 |
|
17,868,759 |
|
|
16,874 |
|
1,065,701 |
|
1087.75 |
% |
|||
|
Total |
|
|
848,171 |
|
59,556,275 |
|
|
522,065 |
|
33,065,896 |
|
62.46 |
% |
|||
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
ADV (USD mm) |
Volume (USD mm) |
|
ADV (USD mm) |
Volume (USD mm) |
|
YoY |
||||||||
|
Total |
|
$ |
2,211,690 |
$ |
147,521,178 |
|
$ |
1,424,185 |
$ |
90,434,913 |
|
55.3 |
% |
(1) |
|
We acquired Yieldbroker, r8fin and ICD on August 31, 2023, January 19, 2024 and August 1, 2024, respectively. Total volume reported includes volumes from each acquired business subsequent to the closing date of the applicable acquisition. |
To access historical traded volumes, go to https://www.tradeweb.com/newsroom/monthly-activity-reports/
BASIS OF PRESENTATION
Tradeweb Markets Inc. (unless the context otherwise requires, together with its subsidiaries, referred to as “we,” “our,” “Tradeweb,” “Tradeweb Markets” or the “Company”) closed its IPO on April 8, 2019. As a result of certain reorganization transactions (the “Reorganization Transactions”) completed in connection with the IPO, on April 4, 2019, Tradeweb Markets Inc. became a holding company whose principal assets consist of its direct and indirect equity interest in Tradeweb Markets LLC (“TWM LLC”) and related deferred tax assets. As the sole manager of TWM LLC, Tradeweb Markets Inc. operates and controls all of the business and affairs of TWM LLC and, through TWM LLC and its subsidiaries, conducts its business. As a result of this control, and because Tradeweb Markets Inc. has a substantial financial interest in TWM LLC, Tradeweb Markets Inc. consolidates the financial results of TWM LLC and its subsidiaries.
Numerical figures included in this release have been subject to rounding adjustments and as a result totals may not be the arithmetic aggregation of the amounts that precede them and figures expressed as percentages may not total
Please refer to the Company's previously filed Quarterly Reports on Form 10-Q and Annual Report on Form 10-K for capitalized terms not otherwise defined herein.
UNAUDITED INTERIM RESULTS
The interim financial results presented herein for the three and nine months ended September 30, 2024 and 2023 are unaudited. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year.
FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements within the meaning of the federal securities laws. Statements related to, among other things, our guidance, including full-year 2024 guidance and full-year 2024 and 2025 revenue guidance related to the LSEG market data license agreement, pending and completed acquisitions, future performance, the industry and markets in which we operate, our expectations, beliefs, plans, strategies, objectives, prospects and assumptions and future events are forward-looking statements.
We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control. These and other important factors, including those discussed under the heading “Risk Factors” in the documents of Tradeweb Markets Inc. on file with or furnished to the SEC, may cause our actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Given these risks and uncertainties, you are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements contained in this release are not guarantees of future events or performance and future events, our actual results of operations, financial condition or liquidity, and the development of the industry and markets in which we operate, may differ materially from the forward-looking statements contained in this release. In addition, even if future events, our results of operations, financial condition, or liquidity, and events in the industry and markets in which we operate, are consistent with the forward-looking statements contained in this release, they may not be predictive of events, results or developments in future periods. Any forward-looking statement that we make in this release speaks only as of the date of such statement. Except as required by law, we do not undertake any obligation to update or revise, or to publicly announce any update or revision to, any of the forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this release.
NON-GAAP FINANCIAL MEASURES
This release contains “non-GAAP financial measures,” including Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted Net Income, Adjusted Net Income per diluted share ("Adjusted Diluted EPS"), Adjusted Expenses, Free Cash Flow and constant currency change, which are supplemental financial measures that are not calculated and presented in accordance with GAAP. We make use of non-GAAP financial measures in evaluating our past results and future prospects. We present these non-GAAP financial measures because we believe they assist investors and analysts in comparing our operating performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core operating performance.
Management and our board of directors use Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT and Adjusted EBIT margin to assess our financial performance and believe they are helpful in highlighting trends in our core operating performance, while other measures can differ significantly depending on long-term strategic decisions regarding capital structure, the tax jurisdictions in which we operate and capital investments. Further, our executive incentive compensation is based in part on components of Adjusted EBITDA.
We use Adjusted Net Income and Adjusted Diluted EPS as supplemental metrics to evaluate our business performance in a way that also considers our ability to generate profit without the impact of certain items. Each of the normal recurring adjustments and other adjustments included in Adjusted Net Income and Adjusted Diluted EPS help to provide management with a measure of our operating performance over time by removing items that are not related to day-to-day operations or are non-cash expenses.
We use Adjusted Expenses as a supplemental metric to evaluate our underlying operating performance over time by removing items that are not related to day-to-day operations or are non-cash expenses.
We use Free Cash Flow to assess our liquidity in a way that considers the amount of cash generated from our core operations after non-acquisition related expenditures for capitalized software development costs and furniture, equipment and leasehold improvements.
We present certain changes on a “constant currency” basis. Since our consolidated financial statements are presented in
See the attached schedules for reconciliations of the non-GAAP financial measures contained in this release to their most comparable GAAP financial measure. Non-GAAP financial measures have limitations as analytical tools, and you should not consider these non-GAAP financial measures in isolation or as alternatives to net income attributable to Tradeweb Markets Inc., net income, net income margin, earnings per share, operating income, operating expenses, cash flow from operating activities or any other financial measure prepared or derived in accordance with GAAP. You are encouraged to evaluate each adjustment included in the reconciliations. In addition, in evaluating Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBIT, Adjusted EBIT margin, Adjusted EBT, Adjusted Net Income, Adjusted Diluted EPS, Adjusted Expenses and Free Cash Flow, you should be aware that in the future, we may incur expenses similar to the adjustments in the presentation of these non-GAAP financial measures.
Our presentation of non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. In addition, the non-GAAP financial measures contained in this release may not be comparable to similarly titled measures used by other companies in our industry or across different industries.
MARKET AND INDUSTRY DATA
This release includes estimates regarding market and industry data that we prepared based on our management’s knowledge and experience in the markets in which we operate, together with information obtained from various sources, including publicly available information, industry reports and publications, surveys, our clients, trade and business organizations and other contacts in the markets in which we operate. In presenting this information, we have made certain assumptions that we believe to be reasonable based on such data and other similar sources and on our knowledge of, and our experience to date in, the markets in which we operate. While such information is believed to be reliable for the purposes used herein, no representations are made as to the accuracy or completeness thereof and we take no responsibility for such information.
TRADEWEB SOCIAL MEDIA
Investors and others should note that Tradeweb announces material financial and operational information using its investor relations website, press releases, SEC filings and public conference calls and webcasts. Information about Tradeweb, its business and its results of operations may also be announced by posts on the Company’s accounts on the following social media channels: Instagram, LinkedIn and X (formerly Twitter). The information that we post through these social media channels may be deemed material. As a result, we encourage investors, the media, and others interested in Tradeweb to monitor these social media channels in addition to following our investor relations website, press releases, SEC filings and public conference calls and webcasts. These social media channels may be updated from time to time on our investor relations website.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241028544767/en/
Investor Relations
Ashley Serrao + 1 646 430 6027
Ashley.Serrao@Tradeweb.com
Media Relations
Daniel Noonan + 1 646 767 4677
Daniel.Noonan@Tradeweb.com
Source: Tradeweb Markets Inc.
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