MarketAxess Holdings Inc. disclosed its financial performance for the fourth quarter (Q4) and full year 2023, reporting robust growth in both revenue and trading volumes across various sectors and regions.
The company recorded a remarkable 10.9% year-over-year (YoY) increase in total Q4 revenues, reaching $197.2 million, which included contributions from the acquisition of Pragma and favorable foreign currency fluctuations.
Net income surged by 18% to $69.6 million, resulting in a 16.5% rise in diluted earnings per share (EPS) to $1.84.
For the entire year of 2023, MarketAxess achieved a 5% YoY growth in total revenues, amounting to $753 million.
Net income also rose by 3% to $258 million, while diluted EPS saw a 3% increase to $6.85. Importantly, these results outperformed the figures from Q3 2023.
MarketAxess CEO, Chris Concannon, commented on the year’s achievements, highlighting the enhancement of client relationships, increased engagement with the new trading platform MarketAxess X-Pro, and substantial growth in Average Daily Volume (ADV) across various products and regions.
The company’s outstanding performance stemmed from record revenues in information services, which grew by 14.6% during the quarter, and a 24.1% improvement in post-trade services revenues.
MarketAxess experienced significant volume increases internationally, with ADV from emerging markets and Eurobonds rising by 10.8%.
Municipal bonds ADV reached a record high, increasing by 7.8% YoY. Portfolio trading volumes also reached new heights, surging by 35.8% compared to the previous year.
November was a standout month, with an all-time high of $303 billion in credit trading volume, which continued into December, exceeding investors’ expectations.
Looking ahead, MarketAxess provided guidance for its full-year 2024 revenue, expecting mid-single-digit percentage growth compared to Pragma’s Q4 2023 revenue base.
The company also projected total expenses for 2024 between $480 million and $500 million, including estimated Pragma operating expenses ranging from $33 million to $35 million.
MarketAxess is optimistic about the fixed-income market’s favorable outlook in 2024 and remains committed to leveraging its strong client franchise and investments to drive sustained growth in the coming quarters.
In addition to the financial updates, MarketAxess announced the departure of Chief Financial Officer Christopher Gerosa, effective January 31, 2024.
Gerosa is set to transition to a new role at a technology solutions company serving the commercial banking industry, marking a significant change in leadership.