MarketAxess (MKTX) investor relations material

Growth initiatives and strategic focus

• Three-year targets set for 8%-9% annual revenue growth and margin expansion, with new initiatives focused on scaling globally across high-grade, high-yield, EM, and EU markets.

• Key protocols include X-Pro front end, blocks protocol (notably Targeted RFQ), portfolio trading (PT), and dealer-initiated solutions like Mid-X.

• Blocks protocol saw strong ADV growth: 24% overall, 18% in the U.S., 27% in EM, and 66% in Eurobonds, with further U.S. rollout planned.

• Portfolio trading share in the U.S. reached 19%, with high-yield PT share up to 15% in October; protocol enhancements continue.

• Dealer-initiated Mid-X solution launched in the U.S., ramping up to daily sessions and receiving positive dealer feedback.

Market structure and competitive positioning

• Market structure in fixed income has shifted: client-initiated trades now 58%, PT 11%, dealer 31%, reflecting a more diverse trading landscape.

• Maintains leading liquidity in RFQ and all-to-all, with volumes and differentiated data supporting competitive strength.

• Electronification has driven a 65% increase in credit market volume, with significant TAM remaining.

• Non-U.S. businesses, especially EM and Eurobonds, are major growth drivers, with EM blocks ADV up 27% and PT up 172%.

• Eurobonds benefit from protocol fit and are often used as a testbed for new technology rollouts.

Technology, automation, and AI

• Automation via Auto-X protocol is growing, with sticky adoption and increasing use for larger trades.

• Pragma acquisition enhances next-gen automation through advanced algos, with integration into X-Pro underway.

• AI initiatives split between commercial (e.g., CP+ pricing, AI Select for block trading) and corporate efficiency projects.

• CP+ leverages proprietary data for unique pricing outputs; AI Select aims to optimize dealer selection for clients.

• Internal AI projects focus on workflow streamlining and coding, with a strategy of "AI everywhere."