"Our strategy to expand our institutional trading network throughout the credit crisis is paying off with record revenues and earnings as the markets continue to recover," said Richard M. McVey, chairman and chief executive officer of MarketAxess. "We are pleased with the growth that we are seeing in all of our major product areas and the momentum is building for greater electronic trading in fixed income markets."

First Quarter Results

Total revenues for the first quarter of 2010 increased 41.6% to $34.9 million, compared to $24.6 million for the first quarter of 2009. Pre-tax income was a record $11.1 million, compared to $4.7 million for the first quarter of 2009, an increase of 134.3%. Pre-tax margin was 31.8%, compared to 19.2% for the first quarter of 2009. Net income totaled $6.7 million, or $0.17 per share on a diluted basis, compared to $2.8 million, or $0.08 per share on a diluted basis, for the first quarter of 2009.

Commission revenue for the first quarter of 2010 totaled $29.3 million on total trading volume of $99.2 billion, compared to $20.4 million in commission revenue on total trading volume of $60.1 billion for the first quarter of 2009. U.S. high-grade trading volume as a percentage of FINRA's high-grade TRACE trading volume increased to an estimated 7.9%, compared to an estimated 5.7% for the first quarter of 2009.

Technology products and services revenue, which includes revenue for technology licenses, support and professional services, totaled $3.2 million for the first quarter of 2010, compared to $2.0 million for the first quarter of 2009. Other revenue, which consists of information and user access fees, investment income and other revenue, increased 11.6% to $2.4 million, compared to $2.2 million for the first quarter of 2009.

Total expenses for the first quarter of 2010 increased 19.6% to $23.8 million, compared to $19.9 million for the first quarter of 2009. The increase was primarily due to higher employee compensation sation and benefits expense of $2.5 million and $0.6 million in one-time expenses related to the relocation to our new corporate headquarters and the Haiti Charity Trading Day.

The effective tax rate for the first quarter of 2010 was 39.5%, compared to 40.0% for the first quarter of 2009.

Employee headcount as of March 31, 2010 was 219, compared to 198 as of March 31, 2009.

Dividend

The Company's board of directors declared a quarterly cash dividend of $0.07 per share of common stock outstanding or issuable upon conversion of outstanding shares of non-voting common stock and Series B preferred stock, to be paid on May 26, 2010 to stockholders of record as of the close of business on May 12, 2010.

Balance Sheet Data

As of March 31, 2010, total assets were $272.6 million and included $167.7 million in cash, cash equivalents and securities, and a deferred tax asset of $20.6 million. Total stockholders' equity, including the Series B preferred stock, as of March 31, 2010 was $252.5 million.