3Q 2026
Filed Oct 23, 2026MarketAxess Reports Third Quarter 2026 Financial Results EPS of $1.53; $1.86 Excluding Notable Items
Total revenues increased 1% and total trading ADV increased 13%, but GAAP net income declined 21%, diluted EPS declined 17%, and GAAP operating margin declined 560 bps. Excluding notable items, operating margin increased 60 bps and diluted EPS increased 1%.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenues, three months ended September 30, 2026 ($ in thousands)GAAP | $210.4M | (4)% | 1% |
| Total revenues, nine months ended September 30, 2026 ($ in thousands)GAAP | $662.2M | – | 4% |
| Commission revenue, three months ended September 30, 2026 ($ in thousands)GAAP | $179.9M | – | — % |
| Commission revenue, nine months ended September 30, 2026 ($ in thousands)GAAP | $570.3M | – | 3% |
| Information services revenue, three months ended September 30, 2026 ($ in thousands)GAAP | $15.17M | – | 10% |
| Information services revenue, nine months ended September 30, 2026 ($ in thousands)GAAP | $45.71M | – | 15% |
| Post-trade services revenue, three months ended September 30, 2026 ($ in thousands)GAAP | $11.44M | – | 1% |
| Post-trade services revenue, nine months ended September 30, 2026 ($ in thousands)GAAP | $34.65M | – | 4% |
| Technology services revenue, three months ended September 30, 2026 ($ in thousands)GAAP | $3.87M | – | 8% |
| Technology services revenue, nine months ended September 30, 2026 ($ in thousands)GAAP | $11.55M | – | 12% |
| Total expenses, three months ended September 30, 2026 ($ in thousands)GAAP | $136.0M | 6% | 10% |
| Total expenses, nine months ended September 30, 2026 ($ in thousands)GAAP | $397.0M | – | 7% |
| Employee compensation and benefits, three months ended September 30, 2026 ($ in thousands)GAAP | $63.42M | – | 6% |
| Depreciation and amortization, three months ended September 30, 2026 ($ in thousands)GAAP | $19.04M | – | (3)% |
| Technology and communications, three months ended September 30, 2026 ($ in thousands)GAAP | $22.06M | – | 10% |
| Professional and consulting fees, three months ended September 30, 2026 ($ in thousands)GAAP | $14.70M | – | 99% |
| Occupancy, three months ended September 30, 2026 ($ in thousands)GAAP | $3.92M | – | 2% |
| Marketing and advertising, three months ended September 30, 2026 ($ in thousands)GAAP | $2.15M | – | (9)% |
| Clearing costs, three months ended September 30, 2026 ($ in thousands)GAAP | $4.24M | – | 7% |
| General and administrative, three months ended September 30, 2026 ($ in thousands)GAAP | $6.49M | – | 6% |
| Operating income, three months ended September 30, 2026 ($ in thousands)GAAP | $74.39M | – | (13)% |
| Operating income, nine months ended September 30, 2026 ($ in thousands)GAAP | $265.2M | – | — % |
| Operating margin, three months ended September 30, 2026GAAP | 35.4% | (570) bps | (560) bps |
| Operating margin, nine months ended September 30, 2026GAAP | 40.0% | – | (170) bps |
| Net income, three months ended September 30, 2026 ($ in thousands)GAAP | $54.03M | (21)%ართველ | (21)% |
| Net income, nine months ended September 30, 2026 ($ in thousands)GAAP | $200.5M | – | 30% |
| Diluted EPS, three months ended September 30, 2026GAAP | $1.53 | (21)% | (17)% |
| Diluted EPS, nine months ended September 30, 2026GAAP | $5.66 | – | 37% |
| Net income margin, three months ended September 30, 2026GAAP | 25.7% | (560) bps | (700) bps |
| Net income margin, nine months ended September 30, 2026GAAP | 30.3% | – | +600 bps |
| Total expenses excluding notable items, three months ended September 30, 2026 ($ in thousands)non-GAAP | $122.9M | (3)% | — |
| Total expenses excluding notable items, nine months ended September 30, 2026 ($ in thousands)non-GAAP | $380.2M | – | 4% |
| Operating margin excluding notable items, three months ended September 30, 2026non-GAAP | 41.6% | (30) bps | +60 bps |
| Operating margin excluding notable items, nine months ended September 30, 2026non-GAAP | 42.6% | – | +20 bps |
| Net income excluding notable items, three months ended September 30, 2026 ($ in thousands)non-GAAP | $65.65M | (5)% | (4)% |
| Net income excluding notable items, nine months ended September 30, 2026 ($ in thousands)non-GAAP | $214.3M | – | 1% |
| Diluted EPS excluding notable items, three months ended September 30, 2026non-GAAP | $1.86 | (5)% | 1% |
| Diluted EPS excluding notable items, nine months ended September 30, 2026non-GAAP | $6.05 | – | 6% |
| EBITDA, three months ended September 30, 2026 ($ in thousands)non-GAAP | $90.68M | (15)% | (16)% |
| EBITDA, nine months ended September 30, 2026 ($ in thousands)non-GAAP | $318.6M | – | (2)% |
| EBITDA margin, three months ended September 30, 2026non-GAAP | 43.1% | (550) bps | (840) bps |
| EBITDA margin, nine months ended September 30, 2026non-GAAP | 48.1% | – | (310) bps |
| Effective tax rate, three months ended September 30, 2026GAAP | 27.8% | – | – |
| Effective tax rate excluding notable items, three months ended September 30, 2026non-GAAP | 25.4% | – | – |
| Free cash flow, three months ended September 30, 2026 ($ in thousands)non-GAAP | $85.72M | – | – |
| Free cash flow, nine months ended September 30, 2026 ($ in thousands)non-GAAP | $190.5M | – | – |
| Net cash provided by operating activities, three months ended September 30, 2026 ($ in thousands)GAAP | $247.3M | – | – |
| Net cash provided by operating activities, nine months ended September 30, 2026 ($ in thousands)GAAP | $198.8M | – | – |
| Total trading ADV, three months ended September 30, 2026 ($ in millions)other | $43.76B | – | 13% |
| Total credit trading ADV, three months ended September 30, 2026 ($ in millions)other | $15.55B | – | 7% |
| Total rates trading ADV, three months ended September 30, 2026 ($ in millions)other | $28.20B | – | 16% |
| Total credit average variable transaction fee per million, three months ended September 30, 2026other | $127 | (2)% | (9)% |
| Total rates average variable transaction fee per million, three months ended September 30, 2026other | 4.89 | (1)% | 16% |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Credit commission revenue, three months ended September 30, 2026The decrease was primarily driven by a 4% decrease in U.S. credit commission revenue reflecting lower variable transaction fee per million, partially offset by higher market volumes and fixed distribution fees. | $161.2M | – | (2)% |
| Rates commission revenue, three months ended September 30, 2026Primarily driven by higher U.S. Treasury volumes and improved FPM. | $8.9M | – | 34% |
| Other commission revenue, three months ended September 30, 2026Primarily driven by higher trading volumes. | $9.8M | – | 14% |
| Information services revenue, three months ended September 30, 2026The increase was principally driven by net new contract revenue. | $15.2M | – | 10% |
| Post-trade services revenue, three months ended September 30, 2026Mainly due to net new contract revenue. | $11.4M | – | 1% |
| Technology services revenue, three months ended September 30, 2026Largely reflecting higher broker execution and port fees. | $3.9M | – | 8% |
Capital returns
- The Board declared a quarterly cash dividend of $0.78 per share, payable on November 25, 2026 to stockholders of record as of the close of business on November 11, 2026.
- Cash declined from $678.9 million as of December 31, 2025 primarily reflecting capital allocation activity during the first nine months of 2026, including share repurchases, repayment of $128.0 million of borrowings under the revolving credit facility and quarterly dividends.
- The accelerated stock repurchase agreement settled in 1Q26.
What drove it
- Services revenue of $30.5 million increased 6%, led by information services revenue growth of 10%.
- Total trading ADV increased 13%, with growth across both credit and rates products and market share gains in high yield and municipal bonds.
- Block trading ADV increased 21% to $5.4 billion, including U.S. credit up 24%, Eurobonds up 16% and emerging markets up 15%.
- Total portfolio trading ADV increased 37% to $1.9 billion, including U.S. credit up 39% and emerging markets up 41%.
- Total rates commission revenue increased 34%, primarily driven by higher U.S. Treasury volumes and improved FPM.
- Total expenses excluding notable items were flat compared to the prior year, and operating leverage excluding notable items was +100 bps.
Concerns
- Total commission revenue of $179.9 million was flat compared to the prior year.
- Total credit FPM decreased 9% compared to the prior year, largely due to protocol and product mix and lower duration of bonds traded in U.S. high-grade.
- GAAP operating margin decreased 560 bps to 35.4%, while EBITDA margin decreased 840 bps to 43.1%.
- GAAP net income declined 21% to $54.0 million and diluted EPS declined 17% to $1.53.
- 3Q26 included $13.1 million of merger-related expenses associated with the pending merger with Intercontinental Exchange, Inc.
- Other income was $0.4 million, down from $8.1 million in the prior year, reflecting a prior-year tax credit, lower interest income, higher interest expense and higher foreign currency transaction losses.
- U.S. high-grade estimated market share was 17.4%, down 90 bps year over year.
What to watch
- Completion of the Merger remains subject to MarketAxess stockholder approval, receipt of required regulatory approvals and the satisfaction or waiver of other closing conditions.
- MarketAxess has suspended issuing guidance and withdrew its previously announced 2026 annual guidance and medium-term financial targets.
- The company has suspended earnings conference calls and monthly volumes press releases in light of the Merger.
- Progress in credit FPM, protocol and product mix, and U.S. high-grade market share.
- Client-initiated block trading, portfolio trading and dealer-initiated channel ADV trends.
- Merger-related expenses, which were $13.1 million in 3Q26.
Balance sheet and cash flow
- Cash, cash equivalents, corporate bond investments and U.S. Treasury investments were $539.6 million as of September 30, 2026, compared with $678.9 million as of December 31, 2025.
- Borrowings outstanding under the credit facility were $92.0 million as of September 30, 2026, compared with $220.0 million as of December 31, 2025.
- Accounts receivable, net were $121,653 thousand as of September 30, 2026, compared with $100,989 thousand as of December 31, 2025.
- Receivables from broker-dealers, clearing organizations and customers were $951,461 thousand as of September 30, 2026, compared with $489,211 thousand as of December 31, 2025.
- Payables to broker-dealers, clearing organizations and customers were $690,058 thousand as of September 30, 2026, compared with $325,959 thousand as of December 31, 2025.
- Net cash provided by operating activities was $247,327 thousand in 3Q 2026; free cash flow was $85,716 thousand.
Analysis
MarketAxess reported a modest top-line quarter, with total revenues of $210.4 million, up 1% from the prior year, while total trading ADV increased 13%. Commission revenue of $179.9 million was flat, showing that substantially higher platform activity did not translate into comparable transaction revenue growth. The key offset was pricing and mix: total credit FPM decreased 9%, which the company attributed to protocol and product mix and lower duration of bonds traded in U.S. high-grade.
Revenue mix favored services and rates. Services revenue increased 6% to $30.5 million, led by information services revenue growth of 10% to $15.2 million on net new contract revenue. Rates commission revenue increased 34% to $8.9 million, driven by higher U.S. Treasury volumes and improved FPM, while other commission revenue increased 14% to $9.8 million. Credit commission revenue decreased 2% to $161.2 million despite a 7% increase in total credit ADV, underscoring the effect of the lower credit FPM.
Activity across strategic channels remained strong. Client-initiated block trading ADV increased 21% to $5.4 billion, total portfolio trading ADV increased 37% to $1.9 billion, and dealer-initiated ADV increased 2% to $1.5 billion. Total credit trading ADV increased 7% and total rates trading ADV increased 16%. Estimated market share improved in U.S. high-yield by 90 bps and municipal bonds by 20 bps, but U.S. high-grade estimated market share declined 90 bps to 17.4%.
Reported profitability was weighed down by merger costs. Total expenses increased 10% to $136.0 million, including $13.1 million of merger-related expenses for the pending ICE transaction. GAAP operating margin declined 560 bps to 35.4%, net income declined 21% to $54.0 million, and diluted EPS declined 17% to $1.53. Excluding notable items, expenses were flat, operating margin increased 60 bps to 41.6%, net income was $65.7 million, and diluted EPS increased 1% to $1.86. Lower other income also hurt GAAP results, as other income was $0.4 million compared with $8.1 million in the prior year.
Capital resources declined as the company funded capital allocation activity. Cash, cash equivalents, corporate bond investments and U.S. Treasury investments were $539.6 million at September 30, 2026, compared with $678.9 million at December 31, 2025, while credit-facility borrowings fell to $92.0 million from $220.0 million. The company declared a $0.78 per-share quarterly dividend. In light of the pending merger, MarketAxess has suspended its earnings calls, annual and medium-term guidance, and monthly volumes press releases; it also withdrew its previously announced 2026 annual guidance and medium-term financial targets.
Management, verbatim
In the third quarter, we continued to execute on our product roadmap across major trading protocols. We launched our enhanced X-Pro RFQ experience to U.S. credit clients, bringing price and spread trading, targeted and direct block workflows and AI-powered dealer selection into a single modern interface. We also delivered the new issue workflow in X-Pro, so clients can access primary and secondary markets side-by-side. Within portfolio trading, we rolled out further enhancements, including CP+ pricing and pre-trade analytics, enabling clients to make faster and more informed decisions. Overall, we continue to make great progress across our strategic priorities and remain committed to delivering innovative solutions that enhance the trading experience for our clients.
Chris Concannon, CEO of MarketAxess
Not in the filing
stated, not guessed- Gross margin was not reported.
- Forward financial guidance was not provided. The company suspended issuing guidance and withdrew its previously announced 2026 annual guidance and medium-term financial targets.
- A dollar amount for share repurchases during the period was not reported.
- A prior-quarter value and sequential comparison were not reported for most detailed revenue, expense, cash flow and balance-sheet line items.
- Year-over-year changes were not reported for free cash flow and net cash provided by operating activities.
- No previous release outlook was provided for comparison.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was checked against the filing text, and a metric whose value, prior period and change do not add up is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.