MarketAxess NASDAQ: MKTX reported record first-quarter 2026 results, driven by higher trading activity, continued growth in international products, and expanding adoption of newer trading protocols and automation tools.
Chief Executive Officer Chris Concannon said the company “grew total revenue by 12% to a record $233 million,” supported by record trading average daily volume (ADV) and record commission revenue. He added that product areas outside U.S. credit grew 20% and that the company’s newer initiatives generated “approximately 50% of total incremental revenue in the quarter.”
Record revenue, EPS growth, and operating leverage
Chief Financial Officer Ilene Fiszel Bieler said first-quarter revenue of $233 million included “$5 million from our RFQ-hub acquisition and a $3 million benefit from foreign currency translation.” She reported diluted EPS of $2.20, or $2.25 excluding notable items, up 20% year over year.
Bieler said the company’s completed $300 million accelerated share repurchase (ASR) program benefited results, noting a “$0.12 benefit to EPS on a 6% reduction in share count.” She also detailed $0.05 per share of notable items, including repositioning charges and legal-related items.
On profitability and costs, Bieler said non-GAAP expenses rose 8% (including a $2 million foreign-currency headwind), reflecting higher compensation and technology and communications spending tied to talent upgrades and technology modernization. Operating margin was 44% in the quarter, up nearly 200 basis points, which Bieler attributed to “the inherent operating leverage in our model.” Headcount was 859, down from both the prior-year quarter and the fourth quarter of 2025.
Commissions driven by record trading and international strength
Bieler said total commissions revenue rose 12% to $203 million, and that half of the incremental commission revenue—about $11 million—came from emerging markets and Eurobonds on record volumes. Total credit commission revenue increased 9% to a record $184 million, driven by 4% growth in both U.S. high yield and U.S. high grade, 24% growth in emerging markets, and 14% growth in Eurobonds.
The company also reported strong growth in “other commissions,” which include FX, equities, derivatives, and ETF activity. Bieler said this line rose $5 million, or 104%, due to RFQ-hub and higher trading volumes.
Services revenue increased 10% to a record $30 million, including record information services revenue of $14 million, post-trade services revenue of $12 million, and technology services revenue of $4 million, which Bieler said was driven by higher connectivity fees from RFQ-hub.
Outside of operating lines, Bieler said other income declined about $5 million due to lower interest income and increased interest expense tied to ASR-related borrowings. For modeling, she highlighted a “one-time $3 million tax credit” in other net that is “non-recurring.” The effective tax rate declined to 25% from 27% primarily due to higher tax credits and other items.
April volume slowdown, market share noise, and new issue focus
Concannon discussed a decline in April trading volumes following a strong first quarter. He said geopolitical events drove volatility and wider spreads during the quarter, but that the widening was short-lived and spreads returned to historically low levels in April. He attributed April’s lower trading volumes to a return to lower volatility and tighter spreads, strong new issuance, and tougher year-over-year comparisons.
Concannon also addressed factors impacting estimated U.S. high-grade market share in April, including a rise in duplicate TRACE reports. He said the company estimates duplicates inflated U.S. high-grade TRACE volumes “by up to 8% in April,” and that adjusting for duplicates would have increased estimated market share by “approximately 160 basis points.” He added that historically high new issuance also weighed on estimated share because MarketAxess generally has lower share during the first two weeks of new issue trading, and clients’ focus on new issues can crowd out secondary activity.
In response to questions, Concannon said the April slowdown was not limited to U.S. credit and was influenced by holiday-related factors and a broader market pullback after March volatility. He pointed to stronger activity late in the month, saying April 30 was the company’s “fourth largest single day trading record in history,” and said early May activity had improved.
Protocol expansion: blocks, portfolio trading, dealer-initiated, and automation
Concannon highlighted growth across the company’s strategic channels and new initiatives:
- Block trading: MarketAxess generated 35% growth in global block ADV to a record $7 billion across U.S. credit, emerging markets, and Eurobonds. In U.S. high grade in March, he said dealer algos won 30% of block trades on the platform.
- Portfolio trading: Global portfolio trading ADV rose 51% to a record $1.9 billion, and U.S. credit portfolio trading market share increased 100 basis points year over year.
- Dealer-initiated trading: The company reported record dealer-initiated ADV and record Mid-X ADV, with Mid-X volumes of $6.7 billion in April, the “second-highest level of monthly activity,” according to Concannon.
- Automation: Automation volume reached $144 billion in the quarter, which Concannon said was helped by increased adoption of the company’s adaptive algo solution.
Concannon also said U.S. high-yield liquidity provision by long-only clients rose almost 80% compared to last year, which he said improved execution quality for high-yield clients.
Product and technology roadmap: new issue solution, auction, and AI
A key theme in the call was MarketAxess’ push to address new issue workflows. Concannon described a partnership with DirectBooks that will provide clients with integrated access to new issue data and functionality within the MarketAxess user experience, including the ability to submit indications of interest. He said the new solution would launch in pilot form at the end of May with one or two clients and then roll out through the summer.
Concannon said the partnership will enable straight-through processing for allocations starting in August and that in the second half of 2026 the company expects to roll out a “single click-to-trade solution for new issue trading” after a deal breaks, using dealer axes and streaming prices. Separately, he said MarketAxess expects to launch a “new issue block trading solution in the second half of 2026.”
On the company’s closing auction protocol, launched late in 2025, Concannon said MarketAxess has seen more than $11 billion staged in auction orders and more than $7 billion submitted into the auction, though trading volume remains “still light.” He said about 12 large buy-side clients and four dealers are actively participating, and framed the initiative as addressing a need for end-of-day liquidity in fixed income markets.
Concannon also emphasized increased use of artificial intelligence to enhance data products and execution tools. He said the company’s proprietary dataset is a key advantage, pointing to inquiry and response data generated by its network and describing it as “proprietary to MarketAxess.” He cited existing AI-driven offerings including CP+, CP+ for Blocks, Depth of Book, SensAI, and AI Dealer Select, and said the company is exploring “AI-derived, real-time market intelligence,” portfolio optimization, and AI-assisted protocol selection.
He added that MarketAxess continues to invest in technology modernization, including the hiring of Chief Technology Officer William Quan, and said the company is using AI to accelerate development and refactor legacy code.
Capital return and balance sheet update
Bieler said MarketAxess ended the quarter with $537 million in cash equivalents and investments, down from $679 million at year-end 2025, reflecting incentive compensation payments, debt paydown, and dividends. During the quarter the company paid $63 million of credit facility borrowings tied to the ASR and $27 million in dividends; it paid down an additional $20 million after quarter-end, leaving $137 million drawn at the end of April. She also said $205 million remained on the board’s share repurchase authorization as of April 30.
Concannon said the company remains focused on executing its long-term strategy, expanding the “MarketAxess advantage” across its network and data, and balancing investment with expense discipline and capital deployment.
About MarketAxess NASDAQ: MKTX
MarketAxess Holdings Inc operates a leading global electronic trading platform specializing in fixed-income securities and related products. The company's network enables institutional investors and broker-dealers to trade corporate bonds, municipal securities, emerging markets debt, U.S. Treasuries and credit default swaps in an automated, multi-dealer environment. MarketAxess also offers portfolio trading, data analytics, best-execution tools and post-trade services to streamline workflows and enhance price discovery across its marketplace.
In addition to core voice-like trading protocols, MarketAxess provides Open Trading®, an anonymous, all-to-all trading protocol designed to improve liquidity and transaction efficiency.
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