MarketAxess (NASDAQ:MKTX) CFO Ilene Fiszel Bieler outlined the company’s priorities to accelerate growth and regain momentum in U.S. credit trading, while emphasizing that much of the firm’s near-term expansion is still expected to come from outside the U.S. Speaking at a UBS conference shortly after the company’s earnings release, Bieler discussed product rollouts, protocol mix, investment plans, and capital allocation.
Growth initiatives and multi-year targets
Bieler pointed to MarketAxess’s recently announced three-year targets, including average annual revenue growth of 8% to 9% and margin expansion averaging 75 to 125 basis points over time. She said the company’s new initiatives are intended to support those goals and are being designed to scale globally across markets such as high-grade, high-yield, emerging markets (EM), and Europe.
U.S. credit focus: blocks, portfolio trading, and dealer-initiated protocols
Bieler said MarketAxess’s U.S. credit business was “relatively flat” last year and that reigniting growth is a key focus. She described several initiatives aimed at expanding MarketAxess’s addressable market and capturing trading activity that remains less electronified.
- Blocks and Targeted RFQ: Bieler said a large portion of the U.S. credit market that is not yet electronified is block trading. She noted that MarketAxess’s block average daily volume (ADV) rose 24% last year, including an 18% increase in the U.S., a 27% increase in EM, and a 66% increase in Eurobonds. She said demand to trade blocks electronically exists, but traders remain focused on avoiding information leakage. She attributed stronger progress outside the U.S. to established dealer relationships and “axe” content, while describing the U.S. rollout as still in a pilot stage due to additional content needs.
- Portfolio trading (PT): Bieler said MarketAxess’s U.S. PT share was about 19% last year, representing a 270 basis point year-over-year increase. She highlighted stronger gains in high-yield PT share in the back half of the year, which she said increased by about 800 basis points. She described PT’s overall market usage as “range-bound,” particularly in high-grade, but said high-yield PT has shown more growth, citing figures that reached as high as 15% share in October and 13% more recently. She also noted PT is “not a big revenue opportunity” for the company despite its strategic importance to clients.
- Dealer-initiated trading and Mid-X: Bieler said dealer RFQ has been building and called the Mid-X protocol “very exciting.” She said Mid-X launched in the U.S. at the end of last year and initially ran only a couple of times per week, moving to daily sessions only within the last month. In January, she said Mid-X facilitated about $3.2 billion in volume. Bieler said dealers have provided positive feedback, highlighting streamlined workflow, a one-step process, efforts to contain information leakage, and the ability to anonymously reduce exposure during matching sessions. She said the plan is to expand to more than one session per day.
Closing auction rollout and legacy RFQ strength
Bieler also addressed a newly launched “closing auction” protocol (described in the discussion as close-only at present). She said the initiative reflects MarketAxess’s focus on innovation and market structure change and was developed over years in collaboration with both buy-side and sell-side participants. While she said she would not view it as a major revenue driver in 2026, she pointed to strong early interest, noting that a client forum attracted more than 400 traders, the largest attendance the company has seen for such an event. She characterized adoption as a multi-year process.
On MarketAxess’s traditional client-initiated RFQ and all-to-all franchise, Bieler argued that fixed income market structure has shifted materially. She cited internal research suggesting the mix of trading has moved from roughly 80% client-initiated and 20% dealer in earlier years to about 58% client-initiated, 10% to 12% portfolio trading, and 30% to 31% dealer activity today. She said MarketAxess still has “the deepest and most differentiated liquidity” in RFQ and all-to-all, while noting the company’s newer protocols are meant to expand its “playing field” in response to the evolving mix.
International growth: emerging markets and Eurobonds
Bieler said MarketAxess expects most incremental growth to come from outside the U.S. in the near term. She stated that the company expects about 20% of incremental growth in year one to come from the U.S., rising to 35% by year three.
In emerging markets, she described MarketAxess’s position as a “franchise” with significant runway, adding that the market may be roughly 10% electronified based on the company’s estimates. She cited several growth metrics in EM, including a 27% increase in block ADV, a 172% increase in portfolio trading (on a smaller base), and a 33% increase in dealer activity. She also highlighted an EM protocol called Request for Market, which allows clients to request pricing without revealing the side of the trade, which she said is particularly valuable in EM. Bieler emphasized the importance of local presence, regulatory navigation, and long-built liquidity networks in countries such as Argentina, Mexico, and Brazil, as well as in Asia-Pacific.
In Eurobonds, Bieler characterized the market as more mature and competitive but said MarketAxess has performed well. She described European liquidity as fragmented across jurisdictions and said the firm’s protocols fit the structure of the market, including addressing best execution needs. She added that Europe is often used as a testbed for piloting and scaling new technology across products and regions.
Automation, AI, pricing mix, and capital allocation
On automation, Bieler discussed Auto-X as “classic automation” used across RFQ and all-to-all, describing it as sticky and supportive of efficiency and cost savings for clients. She said MarketAxess has also seen larger tickets go through automation and cited an example of a client using automation for trades above $2 million and increasing automation usage to about 54% of trades. She said the acquisition of Pragma supports a “next generation” of automation through algorithmic trading tools, including plans to integrate capabilities into X-Pro.
On AI, Bieler said MarketAxess categorizes efforts into “corporate AI” (internal efficiency) and “commercial AI” (monetizable products). She said the company focused early on commercial AI, pointing to CP+ as an AI-driven pricing product powered by MarketAxess platform data. She said the platform generated 5.3 trillion inquiries in 2025, up from 4.7 trillion in 2024, and emphasized that the firm monetizes outputs rather than selling raw data. She also discussed work on “AI Select,” aimed at helping clients—particularly in block trading—identify where liquidity may be found and which dealers may be best positioned, as part of an initiative tied to Smart Dealer Select. Internally, she cited areas such as coding, testing, and workflow streamlining under an “AI everywhere” concept.
On pricing, Bieler said traditional RFQ pricing has been “quite steady,” with only small quarter-to-quarter changes. She framed overall fee trends as primarily driven by protocol mix, noting that portfolio trading is the lowest-priced protocol, dealer activity is competitive but incremental for MarketAxess, and block fees tend to be lower than traditional RFQ due to trade size. She said automation is premium-priced and sticky, often associated with smaller tickets. She also noted that only high-grade pricing uses a duration component, while other asset classes are price-based.
Addressing expenses and margins, Bieler reiterated 2026 expense guidance of $530 million to $545 million (versus $499 million on an ex-notables basis in 2025), and said margin expansion targets are averages over time rather than linear. She said the company conducted an efficiency exercise that saved $17 million and self-funded $16 million of investments, citing vendor management and organizational changes. She said MarketAxess expects to continue investing through 2027, including in protocol rollouts, algorithmic tools, emerging markets, and X-Pro enhancements.
Finally, on capital allocation, Bieler said MarketAxess has “significantly stepped up” capital returns, referencing a $300 million accelerated share repurchase program, $120 million in additional buybacks last year, and about $114 million in dividends. She also noted a dividend increase to $0.78 per share. She described M&A as a lower priority behind organic investment and shareholder returns, and said any deal would face a “very high bar” for accretion and strategic fit, while noting the company continues to monitor opportunities.
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.
