8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 27, 2011

MarketAxess Holdings Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-34091	52-2230784
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

299 Park Avenue New York, New York	10171
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (212) 813-6000

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On April 27, 2011, MarketAxess Holdings Inc. (the “Company”) issued a press release announcing the Company’s financial results for its fiscal first quarter ended March 31, 2011. A copy of this press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information included in this Current Report on Form 8-K (including Exhibit 99.1 hereto) that is furnished pursuant to this Item 2.02 shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended. In addition, the information included in this Current Report on Form 8-K (including Exhibit 99.1 hereto) that is furnished pursuant to this Item 2.02 shall not be incorporated by reference into any filing of the Registrant, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference into such filing.

Item 8.01 Other Events

On April 27, 2011, the Company issued a press release announcing that its Board of Directors has approved a regular quarterly dividend to be paid to the holders of the outstanding shares of capital stock. A cash dividend of $0.09 per share of common stock outstanding or issuable upon conversion of outstanding shares of non-voting common stock will be paid on May 25, 2011 to stockholders of record as of the close of business on May 11, 2011.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits:

99.1 Press Release entitled “MarketAxess Reports First Quarter 2011 Record Revenue of $43.6 Million, Record Pre-Tax Income of $17.7 Million and Diluted EPS of $0.27” issued by MarketAxess Holdings Inc. on April 27, 2011.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	MARKETAXESS HOLDINGS INC.
Date: April 27, 2011	By:	/s/ Richard M. McVey
		Name:	Richard M. McVey
		Title:	Chief Executive Officer

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EXHIBIT INDEX

Exhibit
99.1	Press Release entitled “MarketAxess Reports First Quarter 2011 Record Revenue of $43.6 Million, Record Pre-Tax Income of $17.7 Million and Diluted EPS of $0.27” issued by MarketAxess Holdings Inc. on April 27, 2011.

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EX-99.1

Exhibit 99.1

MARKETAXESS REPORTS FIRST QUARTER 2011 RECORD REVENUE OF $43.6 MILLION, RECORD PRE-TAX
INCOME OF $17.7 MILLION AND DILUTED EPS OF $0.27

First Quarter Financial Highlights^*

• Record revenues of $43.6 million, up 25.0%

• Record pre-tax income of $17.7 million, up 59.4%

• Record pre-tax margin of 40.5%, up from 31.8%

• EBITDA of $19.2 million, up 51.3%

• Net income of $10.8 million, up 60.9%

* All comparisons versus first quarter 2010.

NEW YORK, April 27, 2011 — MarketAxess Holdings Inc. (Nasdaq: MKTX), the operator of a leading electronic trading platform for U.S. and European high-grade corporate bonds, emerging markets bonds and other types of fixed-income securities, today announced results for the first quarter ended March 31, 2011.

“Our record first quarter results reflect continuing U.S. high grade market share gains, which have expanded from 7.9% a year ago to 9.9% in the first quarter of 2011, and strong volume growth in our other product category,” said Richard M. McVey, chairman and chief executive officer of MarketAxess. “Operating margins exceeded 40% for the first time and have doubled in the past two years. The pace of margin improvement is a demonstration of the significant operating leverage in our business.”

First Quarter Results

Total revenues for the first quarter of 2011 increased 25.0% to $43.6 million, compared to $34.9 million for the first quarter of 2010. Pre-tax income was a record $17.7 million, compared to $11.1 million for the first quarter of 2010, an increase of 59.4%. Pre-tax margin was 40.5%, compared to 31.8% for the first quarter of 2010. Net income totaled $10.8 million, or $0.27 per share on a diluted basis, compared to $6.7 million, or $0.17 per share on a diluted basis, for the first quarter of 2010.

Commission revenue for the first quarter of 2011 totaled $37.8 million on total trading volume of $135.2 billion, compared to $29.3 million in commission revenue on total trading volume of $99.2 billion for the first quarter of 2010. U.S. high-grade trading volume as a percentage of FINRA’s high-grade TRACE trading volume increased to an estimated 9.9%, compared to an estimated 7.9% for the first quarter of 2010.

Technology products and services revenue, which includes revenue for technology licenses, support and professional services, totaled $3.1 million for the first quarter of 2011, compared to $3.2 million for the first quarter of 2010. Other revenue, which consists of information and user access fees, investment income and other revenue, increased 12.6% to $2.7 million, compared to $2.4 million for the first quarter of 2010.

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Total expenses for the first quarter of 2011 increased 9.0% to $25.9 million, compared to $23.8 million for the first quarter of 2010. Full year 2011 expenses are now expected to be towards the upper end of the guidance range of $101 million to $107 million. The increase in expenses during the first quarter of 2011 was primarily due to higher employee compensation and benefits expense of $2.3 million and professional and consulting fees of $0.7 million, offset by a decline in general and administrative expenses of $1.1 million. The decline in general and administrative expenses was primarily due to the settlement of a favorable sales tax reimbursement claim amounting to approximately $0.7 million.

The effective tax rate for the first quarter of 2011 was 39.0%, compared to 39.5% for the first quarter of 2010.

Employee headcount as of March 31, 2011 was 232, compared to 219 as of March 31, 2010.

Dividend

The Company’s board of directors declared a quarterly cash dividend of $0.09 per share of common stock outstanding or issuable upon conversion of outstanding shares of non-voting common stock, to be paid on May 25, 2011 to stockholders of record as of the close of business on May 11, 2011.

Balance Sheet Data

As of March 31, 2011, total assets were $303.7 million and included $196.2 million in cash, cash equivalents and securities. Total stockholders’ equity as of March 31, 2011 was $281.4 million. The Series B preferred stock was automatically converted to common stock on January 24, 2011. This conversion does not impact the computation of diluted weighted-average common shares outstanding.

Non-GAAP Financial Measure

EBITDA is a non-GAAP financial measure. The Company believes that this non-GAAP financial measure, when taken into consideration with the corresponding GAAP financial measure, is important in gaining an understanding of the Company’s operating results. See attached schedule for a full reconciliation of GAAP net income to EBITDA.

Webcast and Conference Call Information

Richard M. McVey, chairman and chief executive officer, T. Kelley Millet, president, and Antonio L. DeLise, chief financial officer, will host a conference call to discuss the Company’s financial results and outlook on Wednesday, April 27, 2011, at 8:30 a.m. Eastern time. To access the conference call, please dial 800-322-2803 (U.S.) or 617-614-4925 (international). The passcode for all callers is 19552021. The Company will also host a live audio Webcast of the conference call on the Investor Relations section of the Company’s website at http://www.marketaxess.com. A replay of the call will be made available by dialing 888-286-8010 (U.S.) or 617-801-6888 (international) for one week after the announcement. The passcode for replay callers is 36426874. The Webcast will also be archived on http://www.marketaxess.com for 90 days following the announcement.

About MarketAxess

MarketAxess operates a leading electronic trading platform that enables investment industry professionals to efficiently trade corporate bonds and other types of fixed-income instruments. MarketAxess’ patented trading technology allows institutional investor clients to request competitive, executable bids or offers from multiple broker-dealers simultaneously, and to execute trades with the broker-dealer of their choice. Over 800 institutional investors are active users of the MarketAxess

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trading platform, accessing the global liquidity provided by MarketAxess’ 81 broker-dealer clients in U.S. high-grade corporate bonds, European bonds, high yield and emerging markets bonds, agency bonds, asset-backed and preferred securities and credit default swaps. MarketAxess also offers a number of trading-related products and services, including: market data to assist clients with trading decisions; connectivity solutions that facilitate straight-through processing; technology services to optimize trading environments; and execution services for exchange-traded fund managers and other clients.

MarketAxess maintains its headquarters in New York and has offices in London, Chicago and Salt Lake City. For more information, please visit www.marketaxess.com.

Cautionary Note Regarding Forward-Looking Statements

This press release may contain forward-looking statements, including statements about the outlook and prospects for Company and industry growth, as well as statements about the Company’s future financial and operating performance. These and other statements that relate to future results and events are based on MarketAxess’ current expectations. Actual results in future periods may differ materially from the those currently expected or desired because of a number of risks and uncertainties, including: the level and intensity of competition in the fixed-income electronic trading industry and the pricing pressures that may result; the variability of our growth rate; the rapidly evolving nature of the electronic financial services industry; the level of trading volume transacted on the MarketAxess platform; the absolute level and direction of interest rates and the corresponding volatility in the corporate fixed-income market; our ability to develop new products and offerings and the market’s acceptance of those products; our exposure to risks resulting from non-performance by counterparties to transactions executed between our clients in which we act as an intermediary in matching back-to-back trades; our dependence on our broker-dealer clients; our ability to enter into strategic alliances and to acquire other businesses and successfully integrate them with our business; our future capital needs and our ability to obtain capital when needed; and other factors. The Company’s actual results and financial condition may differ, perhaps materially, from the anticipated results and financial condition in any such forward-looking statements. The Company undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. More information about these and other factors affecting MarketAxess’ business and prospects is contained in MarketAxess’ periodic filings with the Securities and Exchange Commission and can be accessed at www.marketaxess.com.

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Media and Investor Relations Contacts:

Tony DeLise	William McBride
MarketAxess Holdings Inc.	Gavin Anderson & Co.
+1-212-813-6017	+1-212-515-1970

Florencia Panizza
MarketAxess Holdings Inc.
+1-212-813-6029

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MarketAxess Holdings Inc.
Consolidated Statements of Operations

	Three Months Ended
	March 31,
	2011		2010
	($ in thousands, except per share data)
	(unaudited)
Revenues
Commissions
U.S. high-grade	$	26,378	$	19,776
Eurobond		4,617		5,492
Other		6,790		4,039
Total commissions		37,785		29,307
Technology products and services		3,108		3,164
Information and user access fees		1,689		1,634
Investment income		299		291
Other		728		488
Total revenues		43,609		34,884
Expenses
Employee compensation and benefits		16,268		13,933
Depreciation and amortization		1,562		1,616
Technology and communications		2,500		2,417
Professional and consulting fees		2,872		2,138
Occupancy		766		938
Marketing and advertising		974		628
General and administrative		1,001		2,129
Total expenses		25,943		23,799
Income before taxes		17,666		11,085
Provision for income taxes		6,886		4,384
Net income	$	10,780	$	6,701
Per Share Data:
Earnings per share:
Basic	$	0.30	$	0.18
Diluted	$	0.27	$	0.17
Cash dividends declared per common share	$	0.09	$	0.07
Weighted-average common shares:
Basic		36,507		33,626
Diluted		39,301		39,306

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MarketAxess Holdings Inc.
Consolidated Condensed Balance Sheet Data

	March 31, 2011		December 31, 2010
	($ in thousands)
	(unaudited)
Assets
Cash and cash equivalents	$	116,567	$	124,994
Securities available-for-sale		79,663		72,552
Deferred tax assets, net		20,241		19,813
All other assets		87,259		82,162
Total assets	$	303,730	$	299,521
Liabilities and Stockholders’ Equity
Total liabilities	$	22,346	$	34,730
Series B Preferred Stock		—		30,315
Total stockholders’ equity		281,384		234,476
Total liabilities and stockholders’ equity	$	303,730	$	299,521

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MarketAxess Holdings Inc.
Reconciliation of Non-GAAP Financial Measures

	Three Months Ended
	March 31,
	2011		2010
	($ in thousands)
	(unaudited)
Net income	$	10,780	$	6,701
Add back:
Interest expense		16		21
Provision for income taxes		6,886		4,384
Depreciation and amortization		1,562		1,616
Earnings before interest, taxes, depreciation and amortization (EBITDA)	$	19,244	$	12,722

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MarketAxess Holdings Inc.
Volume Statistics

	Total Trading Volume
	Three Months Ended
	March 31,
	2011		2010
	($ in millions)
	(unaudited)
U.S. high-grade — multi dealer 1
fixed-rate	$	82,267	$	58,666
floating-rate		2,938		2,845
Eurobond		11,313		16,019
Other1		38,661		21,672
Total	$	135,179	$	99,202

	Average Daily Volume
	Three Months Ended
	March 31,
	2011		2010
	($ in millions)
	(unaudited)
U.S. high-grade1	$	1,374	$	1,008
Eurobond		180		254
Other1		624		355
Total	$	2,178	$	1,617
Number of U.S. Trading Days 2		62		61
Number of U.K. Trading Days 3		63		63

1	Consistent with FINRA TRACE reporting standards, both sides of trades are included in the Company’s reported volumes when the Company executes trades on a riskless principal basis between two counterparties.
2	The number of U.S. trading days is based on the SIFMA holiday recommendation calendar.
3	The number of U.K. trading days is based on the U.K. Bank holiday schedule.

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