Cover
Cover - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-38860 | ||
Entity Registrant Name | Tradeweb Markets Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 83-2456358 | ||
Entity Address, Address Line One | 1177 Avenue of the Americas | ||
Entity Address, City or Town | New York | ||
Entity Address, State or Province | NY | ||
Entity Address, Postal Zip Code | 10036 | ||
City Area Code | 646 | ||
Local Phone Number | 430-6000 | ||
Title of 12(b) Security | Class A common stock, par value $0.00001 | ||
Trading Symbol | TW | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 6.2 | ||
Documents Incorporated by Reference | Part III of this Annual Report on Form 10-K incorporates by reference portions of the Registrant’s Proxy Statement for its 2021 Annual Meeting of Stockholders. The Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2020. | ||
Entity Central Index Key | 0001758730 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Class A Common Stock, par value $0.00001 per share | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 101,674,943 | ||
Class B Common Stock, par value $0.00001 per share | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 96,933,192 | ||
Class C Common Stock, par value $0.00001 per share | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 1,654,825 | ||
Class D Common Stock, par value $0.00001 per share | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 28,884,108 |
Consolidated Statements of Fina
Consolidated Statements of Financial Condition - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Cash and cash equivalents | $ 791,280 | $ 460,711 |
Restricted cash | 1,000 | 1,000 |
Receivable from brokers and dealers and clearing organizations | 368 | 30,641 |
Deposits with clearing organizations | 11,671 | 9,724 |
Accounts receivable, net of allowance for credit losses of $243 and $195 at December 31, 2020 and 2019, respectively | 105,286 | 92,814 |
Furniture, equipment, purchased software and leasehold improvements, net of accumulated depreciation and amortization | 33,814 | 40,405 |
Right-of-use assets | 29,437 | 24,504 |
Software development costs, net of accumulated amortization | 168,030 | 173,086 |
Goodwill | 2,694,797 | 2,694,797 |
Intangible assets, net of accumulated amortization | 1,182,034 | 1,281,441 |
Receivable from affiliates | 111 | 2,525 |
Deferred tax asset | 579,562 | 256,450 |
Other assets | 82,460 | 27,236 |
Total assets | 5,679,850 | 5,095,334 |
Liabilities | ||
Payable to brokers and dealers and clearing organizations | 252 | 30,452 |
Accrued compensation | 129,288 | 119,415 |
Deferred revenue | 23,193 | 23,990 |
Accounts payable, accrued expenses and other liabilities | 42,692 | 32,834 |
Employee equity compensation payable | 1,900 | 1,048 |
Lease liability | 34,463 | 30,955 |
Payable to affiliates | 5,142 | 1,506 |
Deferred tax liability | 19,425 | 21,572 |
Tax receivable agreement liability | 404,332 | 240,817 |
Total liabilities | 660,687 | 502,589 |
Commitments and contingencies (Note 16) | ||
Stockholders' Equity | ||
Preferred stock, $.00001 par value; 250,000,000 shares authorized; none issued or outstanding | 0 | 0 |
Additional paid-in capital | 4,143,094 | 3,329,386 |
Accumulated other comprehensive income | 4,314 | 1,366 |
Retained earnings | 156,041 | 47,833 |
Total stockholders' equity attributable to Tradeweb Markets Inc. | 4,303,451 | 3,378,588 |
Non-controlling interests | 715,712 | 1,214,157 |
Total equity | 5,019,163 | 4,592,745 |
Total liabilities and stockholders' equity | 5,679,850 | 5,095,334 |
Class A Common Stock | ||
Stockholders' Equity | ||
Common stock | 1 | 1 |
Class B Common Stock | ||
Stockholders' Equity | ||
Common stock | 1 | 1 |
Class C Common Stock | ||
Stockholders' Equity | ||
Common stock | 0 | 0 |
Class D Common Stock | ||
Stockholders' Equity | ||
Common stock | $ 0 | $ 1 |
Consolidated Statements of Fi_2
Consolidated Statements of Financial Condition (Parenthetical) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, authorized (in shares) | 250,000,000 | 250,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Class A Common Stock | ||
Common stock, par value per share (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, outstanding (in shares) | 98,075,465 | 66,408,328 |
Class B Common Stock | ||
Common stock, par value per share (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 450,000,000 | 450,000,000 |
Common stock, outstanding (in shares) | 96,933,192 | 96,933,192 |
Class C Common Stock | ||
Common stock, par value per share (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 350,000,000 | 350,000,000 |
Common stock, outstanding (in shares) | 3,139,821 | 8,328,983 |
Class D Common Stock | ||
Common stock, par value per share (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, authorized (in shares) | 300,000,000 | 300,000,000 |
Common stock, outstanding (in shares) | 30,871,381 | 50,853,172 |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | ||
Revenues | |||
Gross revenue | $ 892,659 | $ 775,566 | |
Contingent consideration | 0 | 0 | |
Net revenue | 892,659 | 775,566 | |
Expenses | |||
Employee compensation and benefits | 349,658 | 329,457 | |
Depreciation and amortization | 153,789 | 139,330 | |
Technology and communications | 47,500 | 39,285 | |
General and administrative | 34,822 | 34,960 | |
Professional fees | 28,875 | 28,029 | |
Occupancy | 14,660 | 14,686 | |
Total expenses | 629,304 | 585,747 | |
Operating income | 263,355 | 189,819 | |
Tax receivable agreement liability adjustment | [1] | 11,425 | 33,134 |
Net interest income (expense) | (316) | 2,373 | |
Income before taxes | 274,464 | 225,326 | |
Provision for income taxes | (56,074) | (52,302) | |
Net income | 218,390 | 173,024 | |
Less: Pre-IPO net income attributable to Tradeweb Markets LLC | 166,296 | 83,769 | |
Net income attributable to Tradeweb Markets Inc. and non-controlling interests | 218,390 | 130,672 | |
Less: Net income attributable to non-controlling interests | 52,094 | 46,903 | |
Net income attributable to Tradeweb Markets Inc. | $ 166,296 | $ 83,769 | |
EPS calculations for pre-IPO and post-IPO periods | |||
Basic (in dollars per share) | [2],[3] | $ 0.92 | $ 0.57 |
Diluted (in dollars per share) | [2],[3] | $ 0.88 | $ 0.54 |
Weighted average shares outstanding | |||
Basic (in shares) | [2],[3] | 180,409,462 | 148,013,274 |
Diluted (in shares) | [2],[3] | 188,223,032 | 156,540,246 |
Transaction fees | |||
Revenues | |||
Gross revenue | $ 518,474 | $ 423,583 | |
Subscription fees | |||
Revenues | |||
Gross revenue | 142,358 | 138,731 | |
Commissions | |||
Revenues | |||
Gross revenue | 163,114 | 149,365 | |
Refinitiv market data fees | |||
Revenues | |||
Gross revenue | 59,706 | 55,635 | |
Other | |||
Revenues | |||
Gross revenue | 9,007 | 8,252 | |
TradeWeb Markets Llc | |||
Expenses | |||
Less: Pre-IPO net income attributable to Tradeweb Markets LLC | $ 0 | 42,352 | |
Net income attributable to Tradeweb Markets Inc. | $ 42,352 | ||
EPS calculations for pre-IPO and post-IPO periods | |||
Basic (in dollars per share) | [2],[4] | $ 0.19 | |
Diluted (in dollars per share) | [2],[4] | $ 0.19 | |
Weighted average shares outstanding | |||
Basic (in shares) | [2],[4] | 222,222,197 | |
Diluted (in shares) | [2],[4] | 223,320,457 | |
[1] | See Note 9 – Tax Receivable Agreement. | ||
[2] | In April 2019, the Company completed the Reorganization Transactions and the IPO, which, among other things, resulted in Tradeweb Markets Inc. becoming the successor of Tradeweb Markets LLC for financial reporting purposes. As a result, earnings per share information for the pre-IPO period is not comparable to the earnings per share information for the post-IPO period. Therefore, earnings per share information is being presented separately for the pre-IPO and post-IPO periods. See Note 17 – Earnings Per Share for additional information. | ||
[3] | Presents information for Tradeweb Markets Inc. (post-IPO period). | ||
[4] | Presents information for Tradeweb Markets LLC (pre-IPO period). |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Net income attributable to Tradeweb Markets Inc. | $ 166,296 | $ 83,769 | ||
Foreign currency translation adjustments attributable to Tradeweb Markets Inc. | 3,093 | 1,441 | ||
Comprehensive income attributable to Tradeweb Markets Inc. | 169,389 | 85,210 | ||
Net income attributable to non-controlling interests | 52,094 | 46,903 | ||
Foreign currency translation adjustments attributable to non-controlling interests | 113 | 298 | ||
Comprehensive income attributable to non-controlling interests | $ 52,207 | 47,201 | ||
TradeWeb Markets Llc | ||||
Net income attributable to Tradeweb Markets Inc. | $ 29,307 | $ 130,160 | 42,352 | |
Foreign currency translation adjustments attributable to Tradeweb Markets Inc. | (866) | (3,064) | 988 | |
Comprehensive income attributable to Tradeweb Markets Inc. | $ 28,441 | $ 127,096 | $ 43,340 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity - USD ($) $ in Thousands | Total | Equity Incentive Plan | RSUs | Performance Restricted Stock Unit (PRSU) | Members' Capital | Common Stock | Common StockClass A Common Stock | Common StockClass B Common Stock | Common StockClass C Common Stock | Common StockClass D Common Stock | Common StockEquity Incentive PlanClass A Common Stock | Additional Paid-In Capital | Additional Paid-In CapitalEquity Incentive Plan | Additional Paid-In CapitalRSUs | Additional Paid-In CapitalPerformance Restricted Stock Unit (PRSU) | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Non-Controlling Interests |
Members' capital beginning of period at Dec. 31, 2018 | $ 4,573,200 | |||||||||||||||||
Equity at beginning of period ( in shares) at Dec. 31, 2018 | 0 | 0 | 0 | 0 | ||||||||||||||
Equity at beginning of period at Dec. 31, 2018 | $ 4,572,334 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ (866) | $ 0 | $ 0 | |||||||||
Comprehensive income: | ||||||||||||||||||
Adjustment to Class C Shares and Class P(C) shares in mezzanine capital | (2,369) | (2,369) | ||||||||||||||||
Capital distributions | (20,000) | (20,000) | ||||||||||||||||
Stock-based compensation | 4,674 | 4,674 | ||||||||||||||||
Net income | 42,352 | 42,352 | ||||||||||||||||
Foreign currency translation adjustments | 988 | 988 | ||||||||||||||||
Members' capital end of period at Mar. 31, 2019 | 4,597,857 | |||||||||||||||||
Equity at end of period at Mar. 31, 2019 | 4,597,979 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 122 | 0 | 0 | |||||||||
Equity at end of period (in shares) at Mar. 31, 2019 | 0 | 0 | 0 | 0 | ||||||||||||||
Members' capital beginning of period at Dec. 31, 2018 | 4,573,200 | |||||||||||||||||
Equity at beginning of period ( in shares) at Dec. 31, 2018 | 0 | 0 | 0 | 0 | ||||||||||||||
Equity at beginning of period at Dec. 31, 2018 | 4,572,334 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | (866) | 0 | 0 | |||||||||
Comprehensive income: | ||||||||||||||||||
Net income | 173,024 | |||||||||||||||||
Members' capital end of period at Dec. 31, 2019 | 0 | |||||||||||||||||
Equity at end of period at Dec. 31, 2019 | 4,592,745 | $ 1 | $ 1 | $ 0 | $ 1 | 3,329,386 | 1,366 | 47,833 | 1,214,157 | |||||||||
Equity at end of period (in shares) at Dec. 31, 2019 | 66,408,328 | 96,933,192 | 8,328,983 | 50,853,172 | ||||||||||||||
Members' capital beginning of period at Mar. 31, 2019 | 4,597,857 | |||||||||||||||||
Equity at beginning of period ( in shares) at Mar. 31, 2019 | 0 | 0 | 0 | 0 | ||||||||||||||
Equity at beginning of period at Mar. 31, 2019 | 4,597,979 | $ 0 | $ 0 | $ 0 | $ 0 | 0 | 122 | 0 | 0 | |||||||||
Comprehensive income: | ||||||||||||||||||
Capital distributions | (100,000) | (100,000) | ||||||||||||||||
Net income | 130,672 | 83,769 | 46,903 | |||||||||||||||
Foreign currency translation adjustments | 1,739 | 1,441 | 298 | |||||||||||||||
Effect of the reorganization transactions | 23,275 | (4,497,857) | 4,521,132 | |||||||||||||||
Issuance of common stock, net of offering costs and cancellations (in shares) | 46,000,000 | 96,933,192 | 10,006,269 | 69,282,736 | 301,478 | |||||||||||||
Issuance of common stock, net of offering costs and cancellations | (18,490) | $ 0 | $ 1 | $ 1 | (18,492) | |||||||||||||
Activities related to the follow-on offering and other exchanges of LLC Interests, net of offering costs and cancellations (in shares) | 20,106,850 | (1,677,286) | (18,429,564) | |||||||||||||||
Activities related to the follow-on offering and other exchanges of LLC Interests, net of offering costs and cancellations | 1 | $ 1 | ||||||||||||||||
Tax receivable agreement liability and deferred taxes arising from the reorganization transactions, IPO and follow-on offering and other LLC Interest ownership changes | (4,382) | (4,382) | ||||||||||||||||
Allocation of equity to non-controlling interests | 0 | (1,607,529) | 1,607,529 | |||||||||||||||
Adjustments to non-controlling interests | 0 | 402,424 | (197) | (402,227) | ||||||||||||||
Distributions to non-controlling interests | (38,346) | (38,346) | ||||||||||||||||
Dividends | (35,936) | (35,936) | ||||||||||||||||
Stock-based compensation expense under the PRSU Plan | $ 20,718 | $ 20,718 | ||||||||||||||||
Stock-based compensation expense under the Option Plan | 24,432 | 24,432 | ||||||||||||||||
Payroll taxes paid for stock-based compensation | (8,917) | (8,917) | ||||||||||||||||
Members' capital end of period at Dec. 31, 2019 | 0 | |||||||||||||||||
Equity at end of period at Dec. 31, 2019 | 4,592,745 | $ 1 | $ 1 | $ 0 | $ 1 | 3,329,386 | 1,366 | 47,833 | 1,214,157 | |||||||||
Equity at end of period (in shares) at Dec. 31, 2019 | 66,408,328 | 96,933,192 | 8,328,983 | 50,853,172 | ||||||||||||||
Comprehensive income: | ||||||||||||||||||
Net income | 218,390 | 166,296 | 52,094 | |||||||||||||||
Foreign currency translation adjustments | 3,206 | 3,093 | 113 | |||||||||||||||
Issuance of common stock, net of offering costs and cancellations (in shares) | 25,170,953 | 0 | (5,189,162) | (19,981,791) | 6,496,184 | |||||||||||||
Issuance of common stock, net of offering costs and cancellations | (2,613) | $ 100,830 | $ 0 | $ (1) | (2,612) | $ 100,830 | ||||||||||||
Tax receivable agreement liability and deferred taxes arising from the reorganization transactions, IPO and follow-on offering and other LLC Interest ownership changes | 203,932 | 203,932 | ||||||||||||||||
Deferred taxes arising from issuance of common stock from equity incentive plans | 14,402 | $ 14,402 | ||||||||||||||||
Adjustments to non-controlling interests | 0 | 534,045 | (145) | (533,900) | ||||||||||||||
Distributions to non-controlling interests | (16,752) | (16,752) | ||||||||||||||||
Dividends | (58,088) | (58,088) | ||||||||||||||||
Stock-based compensation expense under the PRSU Plan | 19,100 | $ 5,359 | $ 27,809 | $ 5,359 | $ 27,809 | |||||||||||||
Stock-based compensation expense under the Option Plan | 6,118 | 6,118 | ||||||||||||||||
Payroll taxes paid for stock-based compensation | (76,175) | (76,175) | ||||||||||||||||
Members' capital end of period at Dec. 31, 2020 | $ 0 | |||||||||||||||||
Equity at end of period at Dec. 31, 2020 | $ 5,019,163 | $ 1 | $ 1 | $ 0 | $ 0 | $ 4,143,094 | $ 4,314 | $ 156,041 | $ 715,712 | |||||||||
Equity at end of period (in shares) at Dec. 31, 2020 | 98,075,465 | 96,933,192 | 3,139,821 | 30,871,381 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Cash flows from operating activities | |||||
Net income | $ 29,307 | $ 130,160 | $ 218,390 | $ 173,024 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 33,020 | 48,808 | 153,789 | 139,330 | |
Contingent consideration | 0 | 26,830 | 0 | 0 | |
Vesting of P-1 (C) Shares | 0 | (5,728) | 0 | 0 | |
Stock-based compensation expense | 0 | 0 | 39,286 | 49,824 | |
Deferred taxes | 968 | 2,602 | 65,189 | 15,024 | |
Tax receivable agreement liability adjustment | [1] | 0 | 0 | (11,425) | (33,134) |
(Increase) decrease in operating assets: | |||||
Receivable from/payable to brokers and dealers and clearing organizations, net | 1,265 | (4,640) | 73 | 3,188 | |
Deposits with clearing organizations | (2,248) | 726 | (1,914) | 1,789 | |
Accounts receivable | 8,085 | (28,434) | (11,620) | (4,283) | |
Receivable from/payable to affiliates, net | (1,102) | (1,850) | 6,136 | (2,461) | |
Other assets | (4,695) | (6,371) | (35,109) | (5,648) | |
Increase (decrease) in operating liabilities: | |||||
Accrued compensation | 38,368 | (7,568) | 9,187 | (1,783) | |
Deferred revenue | (396) | (1,396) | (807) | (3,905) | |
Accounts payable, accrued expenses and other liabilities | 639 | 8,793 | 11,194 | (3,550) | |
Employee equity compensation payable | 9,345 | 2,896 | 865 | (16,412) | |
Net cash provided by operating activities | 112,556 | 164,828 | 443,234 | 311,003 | |
Cash flows from investing activities | |||||
Purchase of furniture, equipment, software and leasehold improvements | (9,090) | (6,327) | (11,490) | (15,781) | |
Capitalized software development costs | (7,156) | (19,523) | (31,046) | (28,681) | |
Purchase of equity investments | 0 | 0 | (20,000) | 0 | |
Net cash used in investing activities | (16,246) | (25,850) | (62,536) | (44,462) | |
Cash flows from financing activities | |||||
Pre-IPO capital distributions | (36,000) | (139,350) | (120,000) | ||
Proceeds from stock-based compensation exercises | 100,830 | ||||
Proceeds from issuance of Class A common stock in the IPO and follow-on offerings, net of underwriting discounts | 0 | 0 | 626,267 | 1,971,224 | |
Purchase of LLC Interests | 0 | 0 | (626,267) | (1,971,224) | |
Offering costs from issuance of Class A common stock in the IPO and follow-on offerings | 0 | 0 | (2,508) | (14,943) | |
Dividends | 0 | 0 | (58,088) | (35,936) | |
Capital distributions to non-controlling interests | 0 | 0 | (16,752) | (38,346) | |
Payroll taxes paid for stock-based compensation | 0 | 0 | (76,175) | (8,917) | |
Net cash used in financing activities | (36,000) | (139,350) | (52,693) | (218,142) | |
Effect of exchange rate changes on cash and cash equivalents | (389) | (2,043) | 2,564 | 2,008 | |
Net increase (decrease) in cash and cash equivalents | 59,921 | (2,415) | 330,569 | 50,407 | |
Cash and cash equivalents and restricted cash | |||||
Beginning of period | 351,383 | 353,798 | 461,711 | 411,304 | |
End of period | 411,304 | 351,383 | 792,280 | 461,711 | |
Supplemental disclosure of cash flow information | |||||
Income taxes paid | 2,659 | 5,500 | 19,105 | 43,842 | |
Non-cash financing activities - Items arising from the reorganization transactions, IPO, follow-on offering and other LLC Interest ownership changes: | |||||
Establishment of liabilities under tax receivable agreement | 0 | 0 | 174,940 | 273,951 | |
Deferred tax asset | 0 | 0 | 393,274 | 269,569 | |
Vesting of contingent consideration | 0 | 150,495 | 0 | 0 | |
Conversion of certain cash-settled PRSUs to equity-settled PRSUs | 19,072 | 0 | 0 | 0 | |
Cash, cash equivalents and restricted cash shown in the statement of cash flows | $ 351,383 | $ 353,798 | $ 792,280 | $ 411,304 | |
[1] | See Note 9 – Tax Receivable Agreement. |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity - (Parenthetical) | 9 Months Ended |
Dec. 31, 2019$ / shares | |
Limited Liability Company (LLC) Members' Equity [Abstract] | |
Dividends declared (in dollars per share) | $ 0.24 |
Organization
Organization | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Tradeweb Markets Inc. (the “Corporation”) was incorporated as a Delaware corporation on November 7, 2018 for the purpose of completing certain reorganization transactions in order to carry on the business of Tradeweb Markets LLC (“TWM LLC”) and conducting an initial public offering (“IPO”) as described below under “—Initial Public Offering” and “—Reorganization Transactions.” The Corporation is a consolidating subsidiary of BCP York Holdings, (“BCP”) a company owned by certain investment funds affiliated with The Blackstone Group Inc. (f/k/a The Blackstone Group L.P.) (“Blackstone”), through BCP’s majority ownership interest in Refinitiv Holdings Limited (the “Parent” and, unless otherwise stated or the context otherwise requires, together with all of its subsidiaries, “Refinitiv”). Refinitiv owns a majority ownership interest in the Company (as defined below). The Corporation is a holding company whose principal asset is LLC Interests (as defined below) of TWM LLC. As the sole manager of TWM LLC, the Corporation operates and controls all of the business and affairs of TWM LLC and, through TWM LLC and its subsidiaries, conducts the Corporation’s business. As a result of this control, and because the Corporation has a substantial financial interest in TWM LLC, the Corporation consolidates the financial results of TWM LLC and reports a non-controlling interest in the Corporation’s consolidated financial statements. As of December 31, 2020, Tradeweb Markets Inc. owns 85.1% of TWM LLC and the non-controlling interest holders own the remaining 14.9% of TWM LLC. Unless the context otherwise requires, references to the “Company” refer to Tradeweb Markets Inc. and its consolidated subsidiaries, including TWM LLC, following the completion of the Reorganization Transactions (as defined below), and TWM LLC and its consolidated subsidiaries prior to the completion of the Reorganization Transactions. The Company is a leader in building and operating electronic marketplaces for a global network of clients across the institutional, wholesale and retail client sectors. The Company’s principal subsidiaries include: • Tradeweb LLC (“TWL”), a registered broker-dealer under the Securities Exchange Act of 1934, a member of the Financial Industry Regulatory Authority (“FINRA”), a registered independent introducing broker with the Commodities Future Trading Commission (“CFTC”) and a member of the National Futures Association (“NFA”). • Dealerweb Inc. (“DW”) (formerly known as Hilliard Farber & Co., Inc.). DW is a registered broker-dealer under the Securities Exchange Act of 1934 and a member of FINRA. DW is also registered as an introducing broker with the CFTC and NFA. • Tradeweb Direct LLC (“TWD”) (formerly known as BondDesk Trading LLC), a registered broker-dealer under the Securities Exchange Act of 1934 and a member of FINRA. • Tradeweb Europe Limited (“TEL”), a Multilateral Trading Facility regulated by the Financial Conduct Authority (the “FCA”) in the UK, which maintains branches in Asia which are regulated by certain Asian securities regulators. • TW SEF LLC (“TW SEF”), a Swap Execution Facility (“SEF”) regulated by the CFTC. • DW SEF LLC (“DW SEF”), a SEF regulated by the CFTC. • Tradeweb Japan K.K. (“TWJ”), a security house regulated by the Japanese Financial Services Agency (“JFSA”) and the Japan Securities Dealers Association (“JSDA”). • Tradeweb EU B.V. (“TWEU”), a Trading Venue and Approved Publication Arrangement regulated by the Netherlands Authority for the Financial Markets (“AFM”). Acquisition of Parent Company and Presentation of Financial Statements A majority interest of Refinitiv (formerly the Thomson Reuters Financial & Risk Business) was acquired by BCP on October 1, 2018 (the “Refinitiv Transaction”) from Thomson Reuters Corporation (“TR”). The accompanying consolidated financial statements are presented for two periods: predecessor and successor, which relate to the periods preceding and succeeding the Refinitiv Transaction, respectively. The Refinitiv Transaction results in a new basis of accounting beginning on October 1, 2018 and the financial reporting periods are presented as follows: • The successor period of the Company, reflecting the Refinitiv Transaction, as of and for the year ended December 31, 2020 and as of December 31, 2019 and for the period from October 1, 2018 to December 31, 2018 (the “2018 Successor Period”). • The predecessor period of the Company for the period from January 1, 2018 to September 30, 2018 (the “2018 Predecessor Period”). See Note 2 – Significant Accounting Policies for a description of pushdown accounting applied as a result of the Refinitiv Transaction. Initial Public Offering On April 8, 2019, the Corporation completed its IPO of 46,000,000 shares of Class A common stock, par value $0.00001 per share, of the Corporation (the “Class A common stock”) at a public offering price of $27.00, which included 6,000,000 shares of Class A common stock issued pursuant to the underwriters’ option to purchase additional shares of Class A common stock. The Corporation received $1.2 billion in net proceeds, after deducting underwriting discounts and commissions but before deducting offering expenses, which were used to purchase membership interests of TWM LLC from certain existing equityholders of TWM LLC (and the corresponding shares of common stock were cancelled as described below), at a purchase price per interest equal to the public offering price of $27.00, less the underwriting discounts and commissions payable thereon. See Note 10 – Stockholders’ Equity. Reorganization Transactions Prior to the closing of the IPO, a series of reorganization transactions (the “Reorganization Transactions”) was completed among the Corporation, TWM LLC and the owners of TWM LLC prior to the Reorganization Transactions (collectively, the “Original LLC Owners”), including the following parties: • certain investment and commercial banks (collectively, the “Bank Stockholders”); • members of management; • the Refinitiv Direct Owner, (i) prior to June 28, 2019, a direct subsidiary of Refinitiv that owned interests in an entity that held membership interests of TWM LLC prior to the Reorganization Transactions and contributed such entity to the Corporation (the “Refinitiv Contribution”) in exchange for shares of Class B common stock, par value $0.00001 per share, of the Corporation (the “Class B common stock”) in connection with the completion of the Reorganization Transactions and (ii) on and after June 28, 2019, an indirect subsidiary of Refinitiv that owns shares of Class B common stock which shares were contributed by the direct subsidiary of Refinitiv referred to in the foregoing clause (i); and • an indirect subsidiary (the “Refinitiv LLC Owner” and, together with the Refinitiv Direct Owner, the “Refinitiv Owners”) of Refinitiv. As used herein, references to “Continuing LLC Owners” refer collectively to (i) those Original LLC Owners, including the Refinitiv LLC Owner, certain Bank Stockholders and members of management, that continued to own LLC Interests (as defined below) after the completion of the IPO and Reorganization Transactions, that received shares of Class C common stock, par value $0.00001 per share, of the Corporation (the “Class C common stock”), shares of Class D common stock, par value $0.00001 per share, of the Corporation (the “Class D common stock”) or a combination of both, as the case may be, in connection with the completion of the Reorganization Transactions, and that may redeem or exchange their LLC Interests for shares of Class A common stock or Class B common stock and (ii) solely with respect to the Tax Receivable Agreement (as defined below), also includes those Original LLC Owners, including certain Bank Stockholders, that disposed of all of their LLC Interests for cash in connection with the IPO. The following Reorganization Transactions occurred: • TWM LLC’s limited liability company agreement (the “TWM LLC Agreement”) was amended and restated to, among other things, (i) provide for a new single class of common membership interests in TWM LLC (“LLC Interests”), (ii) exchange all of the then existing membership interests in TWM LLC for LLC Interests and (iii) appoint the Corporation as the sole manager of TWM LLC. See Note 10 – Stockholders’ Equity. • The Corporation’s certificate of incorporation was amended and restated to, among other things, provide for Class A common stock, Class B common stock, Class C common stock and Class D common stock. See Note 10 – Stockholders’ Equity. • The Corporation issued 20,000,000 shares of Class C common stock and 105,289,005 shares of Class D common stock to the Original LLC Owners that received LLC Interests on a one-to-one basis with the number of LLC Interests they owned immediately following the amendment and restatement of the TWM LLC Agreement for nominal consideration (and the Corporation subsequently cancelled 9,993,731 shares of such Class C common stock and 36,006,269 shares of such Class D common stock in connection with the Corporation’s purchase of LLC Interests from certain of the Bank Stockholders using the net proceeds of the IPO). • As a result of the Refinitiv Contribution (described above), the Corporation received 96,933,192 LLC Interests and the Refinitiv Direct Owner received 96,933,192 shares of Class B common stock. See Note 10 – Stockholders’ Equity. • The Corporation’s board of directors adopted a new omnibus equity incentive plan, under which equity awards may be made in respect of shares of Class A common stock. It also assumed sponsorship of an option plan and PRSU plan formerly sponsored by TWM LLC. See Note 12 – Stock-Based Compensation Plans. • The Corporation entered into a tax receivable agreement (the “Tax Receivable Agreement”) with TWM LLC and the Continuing LLC Owners. See Note 9 – Tax Receivable Agreement. LSEG Transaction On August 1, 2019, London Stock Exchange Group plc announced that it has agreed to definitive terms with a consortium including certain investment funds affiliated with Blackstone as well as TR to acquire the Refinitiv business in an all share transaction (the “LSEG Transaction”). The LSEG Transaction closed on January 29, 2021. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies The following is a summary of significant accounting policies: Basis of Accounting The consolidated financial statements have been presented in conformity with accounting principles generally accepted in the United States of America. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and the difference may be material to the consolidated financial statements. Basis of Presentation and Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. As discussed in Note 1—Organization, as a result of the Reorganization Transactions, Tradeweb Markets Inc. consolidates TWM LLC and TWM LLC is considered to be the predecessor to Tradeweb Markets Inc. for financial reporting purposes. As a result, the consolidated financial statements for periods prior to the Reorganization Transactions have been adjusted to combine the previously separate entities for presentation purposes. However, Tradeweb Markets Inc. had no business transactions or activities and no substantial assets or liabilities prior to the Reorganization Transactions. As such, for periods prior to the completion of the Reorganization Transactions, the consolidated financial statements represent the historical financial condition and results of operations of TWM LLC and its subsidiaries. For periods after the completion of the Reorganization Transactions, the consolidated financial statements represent the financial condition and results of operations of the Company and report a non-controlling interest related to the LLC Interests held by the Continuing LLC Owners. Pushdown Accounting A majority interest of Refinitiv (formerly the Thomson Reuters Financial & Risk Business) was acquired by BCP on October 1, 2018 (the “Refinitiv Transaction”) from TR. The Refinitiv Transaction was accounted for by Refinitiv in accordance with the acquisition method of accounting pursuant to Accounting Standards Codification (“ASC”) 805, Business Combinations, and pushdown accounting was applied to Refinitiv to record the fair value of the assets and liabilities of Refinitiv as of October 1, 2018, the date of the Refinitiv Transaction. The Company, as a consolidating subsidiary of Refinitiv, also accounted for the Refinitiv Transaction using pushdown accounting. Under pushdown accounting, the excess of the fair value of the Company above the fair value accounting basis of the net assets and liabilities of the Company is recorded as goodwill. The fair value of assets acquired and liabilities assumed was determined based on assumptions that reasonable market participants would use in the principal (or most advantageous) market for the asset or liability. The adjusted valuations primarily affected the values of our long-lived and indefinite-lived intangible assets, including software development costs. Cash and Cash Equivalents Cash and cash equivalents consists of cash and highly liquid investments (such as short-term money market instruments) with original maturities of less than three months. Allowance for Credit Losses The Company continually monitors collections and payments from its clients and maintains an allowance for credit losses. The allowance for credit losses is based on an estimate of the amount of potential credit losses in existing accounts receivable, as determined from a review of aging schedules, past due balances, historical collection experience and other specific account data. Careful analysis of the financial condition of our counterparties is also performed. Once determined uncollectable, aged balances are written off as credit loss expense, which is included in general and administrative expenses on the consolidated statements of income. See Note 15 – Credit Risk for additional information. Receivable from and Payable to Brokers and Dealers and Clearing Organizations Receivable from and payable to brokers and dealers and clearing organizations consists of proceeds from transactions executed on the Company's wholesale platform which failed to settle due to the inability of a transaction party to deliver or receive the transacted security. These securities transactions are generally collateralized by those securities. Until the failed transaction settles, a receivable from (and a matching payable to) brokers and dealers and clearing organizations is recognized for the proceeds from the unsettled transaction. Deposits with Clearing Organizations Deposits with clearing organizations are comprised of cash deposits. Due to the short-term nature of these deposits, the recorded value has been determined to approximate fair value. Furniture, Equipment, Purchased Software and Leasehold Improvements Furniture, equipment, purchased software and leasehold improvements are carried at cost less accumulated depreciation. Depreciation for furniture, equipment and purchased software is computed on a straight-line basis over the estimated useful lives of the related assets, ranging from three Furniture, equipment, purchased software and leasehold improvements are tested for impairment whenever events or changes in circumstances suggest that an asset’s carrying value may not be fully recoverable in accordance with ASC 360, Property, Plant and Equipment. Software Development Costs The Company capitalizes costs associated with the development of internal use software at the point at which the conceptual formulation, design and testing of possible software project alternatives have been completed, in accordance with ASC 350, Intangibles – Goodwill and Other . The Company capitalizes employee compensation and related benefits and third party consulting costs incurred during the application development stage which directly contribute to such development. Such costs are amortized on a straight-line basis over three years. Costs capitalized as part of the pushdown accounting allocation are amortized over nine years. The Company reviews the amounts capitalized for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable, or that their useful lives are shorter than originally expected. Non-capitalized software costs and routine maintenance costs are expensed as incurred. Goodwill Goodwill is the excess of the fair value of the Company above the fair value accounting basis of the net assets and liabilities of the Company under pushdown accounting. Goodwill is also the cost of acquired companies in excess of the fair value of identifiable net assets at the acquisition date. Goodwill is not amortized, but in accordance with ASC 350, goodwill is tested for impairment annually and between annual tests whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. Goodwill is tested at the reporting unit level, which is defined as an operating segment or one level below the operating segment. An impairment loss is recognized if the estimated fair value of a reporting unit is less than its net book value. Such loss is calculated as the difference between the estimated fair value of goodwill and its carrying value. In 2019, the Company changed the annual date on which goodwill is tested for impairment from July 1st to October 1st to align with the annual impairment testing date of the Company’s Parent. This change did not accelerate, delay, avoid or cause an impairment charge, nor did this change result in adjustments to any previously issued financial statements. Goodwill was last assessed on October 1, 2020 and no impairment of goodwill was identified. Intangible Assets Intangible assets with a finite life are amortized over the estimated lives, ranging from seven Equity Investments Without Readily Determinable Fair Values Equity Investments without a readily determinable fair value are measured at cost, less impairment, plus or minus observable price changes (in orderly transactions) of an identical or similar investment of the same issuer. If the Company determines that the equity investment is impaired on the basis of a qualitative assessment, the Company will recognize an impairment loss equal to the amount by which the investment’s carrying amount exceeds its fair value. Deferred IPO and Follow-On Offering Costs The Company began incurring costs in connection with the filing of a Registration Statement on Form S-1 for an IPO in 2018 and Registration Statements on Form S-1 for follow-on offerings in 2019 and 2020. IPO and follow-on offering costs consist of legal, accounting, and other costs directly related to the Company’s efforts to raise capital. In accordance with ASC 505-10-25, Equity , these costs are recognized in additional paid-in capital within the consolidated statements of financial condition when the offering is effective. As of December 31, 2020, $15.9 million of deferred costs related to the IPO and $5.2 million of deferred costs related to the follow-on offering were recognized in additional paid-in capital in the consolidated statements of financial condition. See Note 10– Stockholders’ Equity. Translation of Foreign Currency Revenues and expenses denominated in foreign currencies are translated at the rate of exchange prevailing at the transaction date. Assets and liabilities denominated in foreign currencies are translated at the rate prevailing at the consolidated statements of financial condition date. Foreign currency re-measurement gains or losses on transactions in nonfunctional currencies are recognized in the consolidated statements of income. Gains or losses on translation in the financial statements of a non-U.S. operation, when the functional currency is other than the U.S. dollar, are included as a component of comprehensive income. Income Tax The Corporation is subject to U.S. federal, state and local income taxes with respect to its taxable income, including its allocable share of any taxable income of TWM LLC, and is taxed at prevailing corporate tax rates. TWM LLC is a multiple member limited liability company taxed as a partnership and accordingly any taxable income generated by TWM LLC is passed through to and included in the taxable income of its members, including the Corporation. Income taxes also include unincorporated business taxes on income earned or losses incurred for conducting business in certain state and local jurisdictions, income taxes on income earned or losses incurred in foreign jurisdictions on certain operations and federal and state income taxes on income earned or losses incurred, both current and deferred, on subsidiaries that are taxed as corporations for U.S. tax purposes. The Company records deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. The Company measures deferred taxes using the enacted tax rates and laws that will be in effect when such temporary differences are expected to reverse. The Company evaluates the need for valuation allowances based on the weight of positive and negative evidence. The Company records valuation allowances wherever management believes it is more likely than not that the Company will not be able to realize its deferred tax assets in the future. The Company records uncertain tax positions in accordance with ASC 740, Income Taxes , on the basis of a two-step process whereby (i) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to income taxes within the provision for income taxes in the consolidated statements of income. Accrued interest and penalties are included within accounts payable, accrued expenses and other liabilities in the consolidated statements of financial condition. The Company has elected to treat taxes due on future U.S. inclusions in taxable income under the global intangible low-taxed income (“GILTI”) provision of the Tax Cuts and Jobs Act as a current period expense when incurred. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation . ASC 718 focuses primarily on accounting for a transaction in which an entity obtains employee services in exchange for stock-based payments. Under ASC 718, the stock-based payments received by the employees of the Company are accounted for either as equity awards or as liability awards. As an equity award, the Company measures and recognizes the cost of employee services received in exchange for awards of equity instruments based on their estimated fair values measured as of the grant date. These costs are recognized as an expense over the requisite service period, with an offsetting increase to additional paid-in capital. As a liability award, the cost of employee services received in exchange for an award of equity instruments is generally measured based on the grant-date fair value of the award. The fair value of that award is remeasured subsequently at each reporting date through the settlement in accordance with ASC 505. Changes in the equity instrument's fair value during the requisite service period are recognized as compensation cost over that period. For periods following the Reorganization Transactions and the IPO, the fair value of new equity instrument grants is determined based on the price of the Class A common stock on the grant date. Under ASC 718, the grant-date fair value of stock-based awards that do not require future service (i.e., vested awards) are expensed immediately. The grant-date fair value of stock-based awards that require future service, and are graded-vesting awards, are amortized over the relevant service period on a straight-line basis, with each tranche separately measured. The grant-date fair value of stock-based awards that require both future service and the achievement of Company performance-based conditions are amortized over the relevant service period for the performance-based condition. If in a reporting period it is determined that the achievement of a performance target for a performance-based tranche is not probable, then no expense is recognized for that tranche and any expenses already recognized relating to that tranche in prior reporting periods are reversed in the current reporting period. Prior to the IPO, the Company awarded options to management and other employees (collectively, the “Special Option Award”) under the Amended and Restated Tradeweb Markets Inc. Option Plan (the “Option Plan”). In accounting for the options issued under the Option Plan, compensation expense is measured and recognized for all awards based on their estimated fair values measured as of the grant date. Costs related to these options are recognized as an expense in the consolidated statements of income over the requisite service period, with an offsetting increase to additional paid-in capital. The non-cash stock-based compensation expense associated with the Special Option Award began being expensed in the second quarter of 2019. Determining the appropriate fair value model and calculating the fair value of the stock-based awards requires the input of highly subjective assumptions, including the expected life of the stock-based awards and the stock price volatility. The Company uses the Black-Scholes pricing model to value some of its stock-based awards. Earnings Per Share Basic earnings per share is computed by dividing the net income attributable to the Company's shares by the weighted-average number of the Company's shares outstanding during the period. For purposes of computing diluted earnings per share, the weighted-average number of the Company’s shares reflects the dilutive effect that could occur if securities that qualify as participating securities were converted into or exchanged or exercised for TWM LLC’s shares, in the pre-IPO period, and the Class A or Class B common stock, in the post-IPO period, using the treasury stock method, as applicable. Shares of Class C and Class D common stock do not have economic rights in Tradeweb Markets Inc. and, therefore, are not included in the calculation of basic earnings per share. Fair Value Measurement The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price). Instruments that the Company owns (long positions) are marked to bid prices, and instruments that the Company has sold, but not yet purchased (short positions) are marked to offer prices. Fair value measurements do not include transaction costs. The fair value hierarchy under ASC 820, Fair Value Measurement prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below: Basis of Fair Value Measurement A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. • Level 1 : Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; • Level 2 : Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly; • Level 3 : Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. Recent Accounting Pronouncements – Adopted In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments – Credit Losses . The ASU provides new guidance for estimating credit losses on certain types of financial instruments by introducing an approach based on expected losses. ASU 2016-13 was adopted on January 1, 2020 using a modified retrospective method of adoption. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. See Note 15 - Credit Risk for additional information. In January 2017, the FASB issued ASU 2017-4, Intangibles – Goodwill and Other . The ASU simplifies the quantitative goodwill impairment test by eliminating the second step of the test. Under this ASU, impairment will be measured by comparing the estimated fair value of the reporting unit with its carrying value. The new guidance does not amend the optional qualitative assessment of goodwill impairment. ASU 2017-4 was adopted on January 1, 2020. The adoption of this ASU did not impact the Company’s consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments in this ASU simplify the accounting for income taxes by removing certain exceptions for investments, intraperiod allocations and interim calculations and include additional guidance in order to reduce complexity in accounting for income taxes. ASU 2019-12 is effective for annual periods beginning after December 15, 2020, with early adoption permitted. ASU 2019-12 was early adopted on January 1, 2020. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-2, Leases (Topic 842) , which requires lessees to recognize a right-of-use asset and a lease liability for all leases with an initial term in excess of twelve months. The asset reflects the present value of unpaid lease payments coupled with initial direct costs, prepaid lease payments and lease incentives. The amount of the lease liability is calculated as the present value of unpaid lease payments. ASU 2016-2 was adopted on January 1, 2019 using the modified retrospective method of adoption. Upon adoption, the Company: • Recorded right-of-use assets of $31.8 million, • Recorded a lease liability of $39.6 million, • Eliminated deferred rent of $4.9 million, • Eliminated leasehold interests of $2.9 million, • Elected to take the optional package of practical expedients, which allows for no reassessment of i. whether any expired or existing contracts are or contain leases, ii. the lease classification for any expired or existing leases, and iii. initial direct costs for any existing leases. |
Restricted Cash
Restricted Cash | 12 Months Ended |
Dec. 31, 2020 | |
Restricted Cash Equivalents [Abstract] | |
Restricted Cash | Restricted CashCash has been segregated in a special reserve bank account for the benefit of brokers and dealers under SEC Rule 15c3-3. The Company computes the proprietary accounts of other broker-dealers (“PAB”) reserve, which requires the Company to maintain minimum segregated cash in the amount of total credits per the reserve computation. As of December 31, 2020 and December 31, 2019, cash in the amount of $1.0 million has been segregated in the PAB reserve account exceeding the requirements pursuant to SEC Rule 15c3-3. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The carrying amount of goodwill at December 31, 2020 and 2019 was $2.7 billion. Intangible Assets Intangible assets with an indefinite useful life consisted of the following at both December 31, 2020 and 2019 (in thousands): Amount Licenses $ 168,800 Tradename 154,300 Total $ 323,100 Intangible assets that are subject to amortization consisted of the following (in thousands): Successor Successor December 31, 2020 December 31, 2019 Amortization Cost Accumulated Net Carrying Cost Accumulated Net Carrying Customer relationships 12 years $ 928,200 $ (174,037) $ 754,163 $ 928,200 $ (96,687) $ 831,513 Content and data 7 years 154,400 (49,629) 104,771 154,400 (27,572) 126,828 $ 1,082,600 $ (223,666) $ 858,934 $ 1,082,600 $ (124,259) $ 958,341 Amortization expense for definite-lived intangible assets was $99.4 million for the year ended December 31, 2020, $99.4 million for the year ended December 31, 2019, and $24.9 million and $19.6 million for the 2018 Successor Period and 2018 Predecessor Period, respectively. The estimated annual future amortization for definite-lived intangible assets through December 31, 2025 is as follows (in thousands): Amount 2021 $ 99,408 2022 $ 99,408 2023 $ 99,408 2024 $ 99,408 2025 $ 93,894 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases The Company has operating leases for corporate offices and data centers with initial lease terms ranging from three The following is a summary of right-of-use assets and liabilities related to operating leases at both December 31, 2020 and 2019 (in thousands): December 31, 2020 December 31, 2019 Operating lease right-of-use assets $ 29,437 $ 24,504 Operating lease liabilities $ 34,463 $ 30,955 Activity related to the Company's leases for the years ended December 31, 2020 and 2019 is as follows (in thousands): Year Ended December 31, 2020 2019 Operating lease expense $ 10,439 $ 10,265 Cash for amounts included in the measurement of operating liability $ 12,060 $ 11,667 At December 31, 2020 and 2019, the weighted average borrowing rate and weighted average lease term are as follows: December 31, 2020 December 31, 2019 Weighted average borrowing rate 2.9 % 2.9 % Weighted average remaining lease term (years) 4.7 5.9 The following table presents the maturity of lease liabilities as of December 31, 2020 (in thousands): Amount 2021 $ 11,612 2022 7,653 2023 5,404 2024 4,416 2025 2,690 Thereafter 5,089 Total future lease payments 36,864 Less imputed interest (2,401) Lease liability $ 34,463 At December 31, 2020, the future minimum lease payments were as follows (in thousands): Amount 2021 $ 11,612 2022 7,653 2023 5,404 2024 4,416 2025 2,690 Thereafter 5,089 Total $ 36,864 At December 31, 2019, the future minimum lease payments were as follows (in thousands): Amount 2020 $ 8,516 2021 5,946 2022 4,143 2023 3,956 2024 3,558 Thereafter 7,633 Total $ 33,752 Rent expense for the 2018 Successor Period and the 2018 Predecessor Period was $2.7 million and $9.0 million, respectively. One U.S. lease is secured by a letter of credit in the amount of $1.2 million, which is guaranteed by Refinitiv. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Revenue Recognition The Company earns transaction fees from transactions executed on the Company’s trading platforms through various fee plans. Transaction fees are generated both on a variable and fixed price basis and vary by geographic region, product type and trade size. For variable transaction fees, the Company charges clients fees based on the mix of products traded and the volume of transactions executed. Transaction fee revenue is recorded at a point in time when the trade occurs and is generally billed monthly. The Company earns subscription fees from granting access to institutional investors to the Company's electronic marketplaces. Subscription fees are recognized into income in the period that access is provided on a monthly basis. Also included in subscription fees are viewer fees earned monthly from institutional investors accessing fixed income market data. The frequency of subscription fee billings varies from monthly to annually, depending on contract terms. Fees received by the Company which are not yet earned are included in deferred revenue on the consolidated statements of financial condition until the revenue recognition criteria has been met. The Company earns commission revenue from its electronic and voice brokerage services on a riskless principal basis. Riskless principal revenues are derived on matched principal transactions where revenues are earned on the spread between the buy and sell price of the transacted product. Securities transactions and related commission income for brokerage transactions are recognized and recorded on a trade-date basis. Commission revenue is collected by the Company when the trade settles or is billed monthly. The Company earns fees from Refinitiv relating to the sale of market data to Refinitiv, which redistributes that data. Included in these fees, which are billed quarterly, are real-time market data fees which are recognized in the period that the data is provided, generally on a monthly basis, and historical data sets which are recognized when the historical data set is provided to Refinitiv. Significant judgements used in accounting for this contract include: • The provision of real-time market data feeds and annual historical data sets are distinct performance obligations. • The performance obligations under this contract are recognized over time from the initial delivery of the data feeds or each historical data set until the end of the contract term. • Determining the transaction price for the performance obligations by using a market assessment analysis. Inputs in this analysis include a consultant study which determined the overall value of the Company's market data and pricing information for historical data sets provided by other companies. Some revenues earned by the Company have fixed fee components, such as monthly minimums or fixed monthly fees, and variable components, such as transaction based fees. The breakdown of revenues between fixed and variable revenues, in thousands, for the years ended December 31, 2020, December 31, 2019, the 2018 Successor Period and the 2018 Predecessor Period is as follows: Successor Successor Successor Predecessor Year Ended December 31, 2020 Year Ended December 31, 2019 October 1, 2018 to January 1, 2018 to (in thousands) Variable Fixed Variable Fixed Variable Fixed Variable Fixed Revenues Transaction fees $ 413,568 $ 104,906 $ 325,178 $ 98,405 $ 73,800 $ 23,330 $ 208,049 $ 65,702 Subscription Fees including Refinitiv market data fees 1,685 200,379 1,736 192,630 425 46,094 1,305 142,676 Commissions 122,608 40,506 109,995 39,370 22,608 10,232 49,367 30,463 Other 598 8,409 834 7,418 — 2,148 40 8,169 Gross revenue $ 538,459 $ 354,200 $ 437,743 $ 337,823 $ 96,833 $ 81,804 $ 258,761 $ 247,010 Deferred Revenue The Company records deferred revenue when cash payments are received or due in advance of services to be performed. The recognized revenue and remaining balance is shown below (in thousands): Amount Deferred revenue balance - December 31, 2019 $ 23,990 New billings 108,327 Revenue recognized (109,124) Deferred revenue balance - December 31, 2020 $ 23,193 |
Software Development Cost
Software Development Cost | 12 Months Ended |
Dec. 31, 2020 | |
Capitalized Computer Software, Net [Abstract] | |
Software Development Cost | Software Development Costs The components of software development costs, net of accumulated amortization are as follows (in thousands): Successor Successor December 31, December 31, Software development costs $ 235,382 $ 204,336 Accumulated amortization (67,352) (31,250) Software development costs, net of accumulated amortization $ 168,030 $ 173,086 Capitalized software development costs and amortization expense are as follows (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 January 1, 2018 Software development costs capitalized $ 31,046 $ 28,681 $ 7,156 $ 19,523 Amortization expense related to capitalized software development costs $ 36,102 $ 26,176 $ 5,074 $ 19,962 Non-capitalized software costs and routine maintenance costs are expensed as incurred and are included in employee compensation and benefits and professional fees on the consolidated statements of income. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesFor the year ended December 31, 2020, total income before the provision for income taxes amounted to $274.5 million, consisting of $251.0 million in the United States and $23.5 million in foreign locations. The provision for income taxes consists of the following (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Current: Federal $ (16,529) $ 21,373 $ — $ — State and Local 5,261 11,537 1,235 5,739 Foreign 2,153 4,368 1,212 3,559 Total current tax expense (9,115) 37,278 2,447 9,298 Deferred: Federal 52,845 (88) 680 1,085 State and local 12,572 18,194 288 1,517 Foreign (228) (3,082) — — Total deferred tax expense 65,189 15,024 968 2,602 Total provision for income taxes $ 56,074 $ 52,302 $ 3,415 $ 11,900 A reconciliation of the U.S. federal statutory tax rate to the effective rate is as follows: Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Statutory U.S. federal income tax rate 21.0 % 21.0 % 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 5.0 3.9 4.7 5.1 Foreign tax rate differential 0.2 (1.1) 3.7 2.5 LLC flow-through structure — — (19.0) (20.2) Non-controlling interest (3.4) (7.2) — — Tax Receivable Agreement adjustment (0.9) (3.1) — — Rate change (0.2) 10.2 — — Equity Compensation (1.8) — — — Other 0.5 (0.5) — — Effective income tax rate 20.4 % 23.2 % 10.4 % 8.4 % The effective tax rate for the year ended December 31, 2020 was less than the U.S. federal statutory rate of 21.0% primarily due to the effect of non-controlling interests and the tax impact of the exercise of equity compensation, partially offset by state, local and foreign taxes. The effective tax rate for the year ended December 31, 2019 is greater than the U.S. federal statutory rate of 21.0% primarily due to the effect of non-controlling interests and other discrete items, partially offset by state and local taxes including the tax impact of state apportionment rate changes on total tax expense as a result of the reduction of the Company's net deferred asset. The effective tax rate increased from the 2018 Successor Period and the 2018 Predecessor Period due to the Reorganization Transactions. Prior to the Reorganization Transactions, income taxes consisted only of business taxes incurred by TWM LLC and certain subsidiaries for business conducted in certain state, local and foreign jurisdictions as well as federal, state and local taxes for certain subsidiaries that are taxed as corporations for U.S. tax purposes. As a result of the Reorganization Transactions, the Corporation is subject to U.S. federal, state and local income taxes with respect to its taxable income, including its allocable share of any taxable income of TWM LLC, and is taxed at prevailing corporate tax rates. The Company’s actual effective tax rate will be impacted by the Corporation’s ownership share of TWM LLC, which is expected to continue to increase over time as Continuing LLC Owners redeem or exchange their LLC Interests for shares of Class A common stock or Class B common stock, as applicable, or the Corporation purchases LLC Interests from Continuing LLC Owners. The Company's consolidated effective tax rate will vary from period to period depending on changes in the mix of earnings, tax legislation and tax rates in various jurisdictions. The components of the Company’s net deferred tax asset (liability) are as follows (in thousands): Successor Successor Year Ended December 31, Year Ended December 31, Deferred tax assets: Investment in partnership $ 509,835 $ 226,241 Net operating losses 21,647 1,753 Tax Receivable Agreement - Interest 13,859 10,395 Employee compensation 23,291 9,888 Tax credits 9,276 8,342 Other 7,150 4,088 Deferred tax assets, gross 585,058 260,707 Valuation Allowance (110) — Total deferred tax assets, net 584,948 260,707 Deferred tax liabilities Goodwill and Intangibles (24,811) (25,829) Total deferred tax liabilities (24,811) (25,829) Total net deferred tax asset (liability) $ 560,137 $ 234,878 The Company expects to obtain an increase in its share of the tax basis of the assets of TWM LLC when LLC Interests are redeemed or exchanged by the Continuing LLC Owners and in connection with certain other qualifying transactions. This increase in tax basis may have the effect of reducing the amounts that the Corporation would otherwise pay in the future to various tax authorities. Pursuant to the Tax Receivable Agreement, the Corporation is required to make cash payments to the Continuing LLC Owners equal to 50% of the amount of U.S. federal, state and local income or franchise tax savings, if any, that the Corporation actually realizes (or in some circumstances are deemed to realize) as a result of certain future tax benefits to which we may become entitled. The Corporation expects to benefit from the remaining 50% of tax benefits, if any, that the Corporation may actually realize. See Note 9 – Tax Receivable Agreement. The tax benefit has been recognized in deferred tax assets on the December 31, 2020 consolidated statement of financial condition. As of December 31, 2020, the Company had tax effected U.S. federal net operating loss carryforwards for income tax purposes of $16.8 million and state and local net operating loss carryforwards of $4.8 million, respectively. If not utilized, the state and local net operating loss carryforwards will begin to expire in 2035. The U.S. federal net operating loss carryforwards can be carried forward indefinitely. The components of the Company’s uncertain tax positions are as follows (in thousands): Successor December 31, Gross unrecognized tax benefits as of January 1 $ 6,512 Increase in current year tax positions 722 Increase in prior year tax positions 1,188 Decrease in prior year tax positions (2,908) Acquired tax positions — Settlements — Gross unrecognized tax benefited as of December 31 $ 5,514 The Company recognizes interest and penalties related to income taxes within the provision for income taxes in the consolidated statements of income. Accrued interest and penalties are included within accounts payable, accrued expenses and other liabilities in the consolidated statements of financial condition. The total amount of interest and penalties accrued as of December 31, 2020 are $2.6 million and $0.5 million, respectively. As a result of the Refinitiv Contribution, the Company assumed the tax liabilities of the contributed entity. The contributed entity is under audit by the State of New Jersey for the tax years 2012 - 2015 and is appealing a tax assessment from an audit by the State of New Jersey for the tax years 2008 - 2011. At December 31, 2020, the tax liability related to the Refinitiv Contribution is $2.7 million and is included within accounts payable, accrued expenses and other liabilities on the consolidated statement of financial condition. The Company is indemnified by Refinitiv for tax liabilities that were assumed by the Company as a result of the Refinitiv Contribution. At December 31, 2020, $2.7 million is included in other assets on the consolidated statement of financial condition related to this indemnification. The above tax positions were recognized using the best estimate of the amount expected to be paid based on available information and assessment of all relevant factors. Due to the uncertainty associated with tax audits, it is possible that at some future date liabilities resulting from these audit could vary significantly from these positions. Nevertheless, based on currently enacted legislation and information currently known to us, the Company believes that the ultimate resolution of these audits will not have a material adverse impact on the Company’s financial condition taken as a whole. Furthermore, the Company anticipates approximately $2.5 million of net uncertain tax benefits will decrease within the next twelve months. |
Tax Receivable Agreement
Tax Receivable Agreement | 12 Months Ended |
Dec. 31, 2020 | |
Tax Receivable Agreement | |
Tax Receivable Agreement | Tax Receivable Agreement In connection with the Reorganization Transactions, the Corporation entered into the Tax Receivable Agreement with TWM LLC and the Continuing LLC Owners, which provides for the payment by the Corporation to a Continuing LLC Owner of 50% of the amount of U.S. federal, state and local income or franchise tax savings, if any, that the Corporation actually realizes (or in some circumstances is deemed to realize) as a result of (i) increases in the tax basis of TWM LLC’s assets resulting from (a) the purchase of LLC Interests from such Continuing LLC Owner, including with the net proceeds from the IPO, the October 2019 follow-on offering and any future offering or (b) redemptions or exchanges by such Continuing LLC Owner of LLC Interests for shares of Class A common stock or Class B common stock or for cash, as applicable, and (ii) certain other tax benefits related to the Corporation making payments under the Tax Receivable Agreement. Payments under the Tax Receivable Agreement are made within 150 days after the filing of the tax return based on the actual tax savings realized by the Corporation. The first payment of the Tax Receivable Agreement was made in January 2021. As of December 31, 2019, the liability was $240.8 million, primarily due to the purchase of LLC Interests by the Corporation using the net proceeds of the IPO and the October 2019 follow-on offering, as well as additional exchanges of LLC Interests by Continuing LLC Owners. During 2020, the liability increased to $404.3 million, primarily due to the April 2020 follow-on offering and additional exchanges of LLC Interests by Continuing LLC Owners. Substantially all payments due under the tax receivable agreement are payable over the fifteen years following the purchase of LLC Interests from Continuing LLC Owners or redemption or exchanges by Continuing LLC Owners of LLC Interests. The Corporation accounts for the income tax effects resulting from taxable redemptions or exchanges of LLC Interests by the Continuing LLC Owners for shares of Class A common stock or Class B common stock or cash, as the case may be, and purchases by the Corporation of LLC Interests from the Continuing LLC Owners by recognizing an increase in deferred tax assets, based on enacted tax rates at the date of each redemption, exchange or purchase, as the case may be. Further, the Corporation evaluates the likelihood that it will realize the benefit represented by the deferred tax asset, and, to the extent that the Corporation estimates that it is more likely than not that it will not realize the benefit, it reduces the carrying amount of the deferred tax asset with a valuation allowance. The impact of any changes in the projected obligations under the Tax Receivable Agreement as a result of changes in the mix of the Company’s earnings, tax legislation and tax rates in various jurisdictions, or other factors that may impact the Corporation’s tax savings, are reflected in income before taxes on the consolidated statement of income in the period in which the change occurs. During the years ended December 31, 2020 and 2019, the Company recognized a Tax Receivable Agreement liability adjustment of $11.4 million and $33.1 million, respectively, in the consolidated statements of income. |
Stockholder's Equity
Stockholder's Equity | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders’ Equity | Stockholders’ Equity Initial Public Offering and Reorganization Transactions As described in Note 1 – Organization, in April 2019, the Corporation completed its IPO of 46,000,000 shares of Class A common stock at a public offering price of $27.00, which included 6,000,000 shares of Class A common stock issued pursuant to the underwriters’ option to purchase additional shares of Class A common stock. The Corporation received $1.2 billion in net proceeds, after deducting underwriting discounts and commissions but before deducting offering expenses, which were used to purchase LLC Interests from certain of the Bank Stockholders (and the corresponding shares of common stock were cancelled as described below), at a purchase price per interest equal to the public offering price of $27.00, less the underwriting discounts and commissions payable thereon. In connection with the IPO, the Reorganization Transactions described below were completed. Amendment and Restatement of Certificate of Incorporation On April 3, 2019, the certificate of incorporation of Tradeweb Markets Inc. was amended and restated to, among other things, provide for the authorization of (i) 250,000,000 shares of preferred stock with a par value of $0.00001 per share (ii) 1,000,000,000 shares of Class A common stock with a par value of $0.00001 per share; (iii) 450,000,000 shares of Class B common stock with a par value of $0.00001 per share; (iv) 350,000,000 shares of Class C common stock with a par value of $0.00001 per share; and (v) 300,000,000 shares of Class D common stock with a par value of $0.00001 per share. Each share of Class A common stock and Class C common stock entitles its holder to one vote on all matters presented to the Corporation’s stockholders generally. Each share of Class B common stock and Class D common stock entitles its holder to ten votes on all matters presented to the Corporation’s stockholders generally. The holders of Class C common stock and Class D common stock have no economic interests in the Corporation (where “economic interests” means the right to receive any dividends or distributions, whether cash or stock, in connection with common stock). These attributes are summarized in the following table: Class of Par Votes Economic Class A common stock $ 0.00001 1 Yes Class B common stock $ 0.00001 10 Yes Class C common stock $ 0.00001 1 No Class D common stock $ 0.00001 10 No Holders of outstanding shares of Class A common stock, Class B common stock, Class C common stock and Class D common stock will vote together as a single class on all matters presented to the Corporation’s stockholders for their vote or approval, except as otherwise required by applicable law. Holders of Class B common stock may from time to time exchange all or a portion of their shares of Class B common stock for newly issued shares of Class A common stock on a one-for-one basis (in which case their shares of Class B common stock will be cancelled on a one-for-one basis upon any such issuance). Continuing LLC Owners that hold shares of Class D common stock may from time to time exchange all or a portion of their shares of Class D common stock for newly issued shares of Class C common stock on a one-for-one basis (in which case their shares of Class D common stock will be cancelled on a one-for-one basis upon such issuance). In addition, with respect to each Bank Stockholder that holds shares of Class D common stock, immediately prior to the occurrence of any event that would cause the combined voting power held by such Bank Stockholder to exceed 4.9%, the minimum number of shares of Class D common stock of such Bank Stockholder that would need to convert into shares of Class C common stock such that the combined voting power held by such Bank Stockholder would not exceed 4.9% will automatically convert into shares of Class C common stock. Each share of Class B common stock will automatically convert into one share of Class A common stock and each share of Class D common stock will automatically convert into one share of Class C common stock (i) immediately prior to any sale or other transfer of such share by a holder or its permitted transferees to a non-permitted transferee or (ii) once the Refinitiv Owners and their affiliates together no longer beneficially own a number of shares of common stock and LLC Interests that together entitle them to at least 10% of TWM LLC’s economic interest. Holders of LLC Interests that receive shares of Class C common stock upon any such conversion may continue to elect to have their LLC Interests redeemed for newly issued shares of Class A common stock as described below (in which case their shares of Class C common stock will be cancelled on a one-for-one basis upon such issuance). In addition, the Corporation’s board of directors adopted the Omnibus Equity Plan, under which equity awards may be made in respect of shares of Class A common stock. It also assumed sponsorship of the Option Plan and a PRSU plan formerly sponsored by TWM LLC. See Note 12 – Stock-Based Compensation Plans. Recapitalization of Tradeweb Markets LLC On April 4, 2019, the TWM LLC Agreement was amended and restated to, among other things, (i) provide for the LLC Interests, (ii) exchange all of the then existing membership interests in TWM LLC for LLC Interests and (iii) appoint the Corporation as the sole manager of TWM LLC. All of the shares of TWM LLC outstanding prior to the Reorganization Transactions were exchanged for 222,222,197 LLC Interests. TWM LLC’s outstanding shares prior to the Reorganization Transactions consisted of the following classes of shares: Shares Class A 146,333 Class C 447 Class P (A) 6,887 Class P (C) 2 Class P-1(A) 6,094 Class P-1 (C) 232 The TWM LLC Agreement requires that TWM LLC at all times maintain (i) a one-to-one ratio between the number of shares of Class A common stock and Class B common stock issued by the Corporation and the number of LLC Interests owned by the Corporation and (ii) a one-to-one ratio between the number of shares of Class C common stock and Class D common stock issued by the Corporation and the number of LLC Interests owned by the holders of such Class C common stock and Class D common stock. LLC Interests held by Continuing LLC Owners are redeemable in accordance with the TWM LLC Agreement, at the election of such holders, for newly issued shares of Class A common stock or Class B common stock, as the case may be, on a one-for-one basis (and such holders’ shares of Class C common stock or Class D common stock, as the case may be, will be cancelled on a one-for-one basis upon any such issuance). In the event of such election by a Continuing LLC Owner, the Corporation may, at its option, effect a direct exchange of Class A common stock or Class B common stock for such LLC Interests of such Continuing LLC Owner in lieu of such redemption. In addition, the Corporation’s board of directors may, at its option, instead of the foregoing redemptions or exchanges of LLC Interests, cause the Corporation to make a cash payment equal to the volume weighted average market price of one share of Class A common stock for each LLC Interest redeemed or exchanged (subject to customary adjustments, including for stock splits, stock dividends and reclassifications) in accordance with the terms of the TWM LLC Agreement. Issuance and Cancellation of Common Stock • As a result of the Refinitiv Contribution, the Corporation received 96,933,192 LLC Interests and the Refinitiv Direct Owner received 96,933,192 shares of Class B common stock. • The Corporation issued 20,000,000 shares of Class C common stock and 105,289,005 shares of Class D common stock to the Original LLC Owners that received LLC Interests on a one-to-one basis with the number of LLC Interests they owned immediately following the amendment and restatement of the TWM LLC Agreement for nominal consideration (the Corporation subsequently cancelled 9,993,731 shares of such Class C common stock and 36,006,269 shares of such Class D common stock in connection with the Corporation’s purchase of LLC Interests from certain of the Bank Stockholders using the net proceeds of the IPO). Following the completion of the Reorganization Transactions, including the IPO and the application of the proceeds therefrom as described above, (i) the investors in the IPO collectively owned 46,000,000 shares of Class A common, representing 2.7% of the combined voting power of all of the Corporation’s common stock and, through the Corporation’s ownership of LLC Interests, 20.7% of the economic interest in TWM LLC; (ii) the Refinitiv Direct Owner owned 96,933,192 shares of Class B common stock, representing 56.4% of the combined voting power of all of the Corporation’s common stock and, through the Corporation’s ownership of LLC Interests, 43.6% of the economic interest in TWM LLC; (iii) the Refinitiv LLC Owner owned 22,988,329 shares of Class D common stock, representing 13.4% of the combined voting power of all of the Corporation’s common stock, and 22,988,329 LLC Interests, representing 10.3% of the economic interest in TWM LLC, (iv) the Continuing LLC Owners (other than the Refinitiv LLC Owner) collectively owned 10,006,269 shares of Class C common stock and 46,294,407 shares of Class D common stock, representing 27.5% of the combined voting power of all of the Corporation’s common stock, and 56,300,676 LLC Interests, representing 25.3% of the economic interest in TWM LLC; and (v) the Corporation owned 142,933,192 LLC Interests, representing 64.3% of the economic interest in TWM LLC. October 2019 Follow-On Offering In the fourth quarter of 2019, Tradeweb Markets Inc. completed an underwritten follow-on offering of 19,881,059 shares of Class A Common stock at a public offering price of $42.00 per share, which included 2,593,181 shares of Class A common stock issued pursuant to the underwriters’ option to purchase additional shares of Class A common stock. Tradeweb Markets Inc. received net proceeds of $810.0 million, after deducting underwriting discounts and commissions but before deducting estimated offering expenses, which were used to purchase (i) 19,835,666 issued and outstanding LLC Interests from certain of the Bank Stockholders and certain executive officers (and the corresponding shares of Class C common stock and/or Class D common stock held by such holders were cancelled) and (ii) 45,393 issued and outstanding shares of Class A common stock from certain executive officers (which shares of Class A common stock were cancelled), at a purchase price per interest and share equal to the public offering price of $42.00, less the underwriting discounts and commissions payable thereon. April 2020 Follow-On Offering In the second quarter of 2020, Tradeweb Markets Inc. completed an underwritten follow-on offering of 12,835,245 shares of Class A Common stock at a public offering price of $50.25 per share, which included 1,674,162 shares of Class A common stock issued pursuant to the underwriters’ option to purchase additional shares of Class A common stock. Tradeweb Markets Inc. received net proceeds of $626.3 million, after deducting underwriting discounts and commissions but before deducting estimated offering expenses, which were used to purchase (i) 12,238,827 issued and outstanding LLC Interests from certain of the Bank Stockholders and certain executive officers (and the corresponding shares of Class C common stock and/or Class D common stock held by such holders were cancelled) and (ii) 596,418 issued and outstanding shares of Class A common stock from certain executive officers (which shares of Class A common stock were cancelled), at a purchase price per interest and share equal to the public offering price per share of $50.25, less the underwriting discounts and commissions payable thereon. Redemptions and Exchanges of LLC Interests In addition to the IPO, the October 2019 follow-on offering and the April 2020 follow-on offering transactions described above, certain Continuing LLC Owners may, from time to time, exercise their redemption rights under the TWM LLC Agreement, pursuant to which LLC Interests are exchanged for newly-issued shares of Class A common stock. Simultaneously, and in connection with these exchanges, shares of Class C and/or Class D common stock are surrendered by the Continuing LLC Owners and cancelled. In connection with these exchanges, Tradeweb Markets Inc. receives LLC Interests, increasing its total ownership interest in TWM LLC. As a result of the Reorganization Transactions, the IPO, the October 2019 follow-on offering, the April 2020 follow-on offering and other exchanges and equity activity, as of December 31, 2020: • The public investors collectively owned 98,075,465 shares of Class A common stock, representing 7.1% of the combined voting power of Tradeweb Markets Inc.’s issued and outstanding common stock and indirectly, through Tradeweb Markets Inc., owned 42.8% of the economic interest in TWM LLC; • Refinitiv collectively owned 96,933,192 shares of Class B common stock and 22,988,329 shares of Class D common stock, representing 86.9% of the combined voting power of Tradeweb Markets Inc.’s issued and outstanding common stock and directly and indirectly, through Tradeweb Markets Inc., owned 52.4% of the economic interest in TWM LLC; and • The Bank Stockholders that continue to own LLC Interests collectively owned 3,139,821 shares of Class C common stock and 7,754,708 shares of Class D common stock, representing 5.9% of the combined voting power of Tradeweb Markets Inc.’s issued and outstanding common stock and directly and indirectly, through Tradeweb Markets Inc., owned 4.8% of the economic interest in TWM LLC. Share Repurchases During the year ended December 31, 2020, the Company withheld 1,509,321 shares of common stock from employee stock option and restricted stock unit awards, at an average price per share of $50.47 and an aggregate value of $76.2 million based on the price of the Class A common stock on the date the relevant withholding occurred. These shares are withheld in order for the Company to cover the payroll tax withholding obligations upon the exercise of stock options and vesting of restricted stock units. |
Non-Controlling Interests
Non-Controlling Interests | 12 Months Ended |
Dec. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Non-Controlling Interests | Non-Controlling InterestsIn connection with the Reorganization Transactions, Tradeweb Markets Inc. became the sole manager of TWM LLC and, as a result of this control, and because Tradeweb Markets Inc. has a substantial financial interest in TWM LLC, consolidates the financial results of TWM LLC into its consolidated financial statements. The non-controlling interests balance reported on the consolidated statements of financial condition represents the economic interests of TWM LLC held by the holders of LLC Interests other than Tradeweb Markets Inc. Income or loss is attributed to the non-controlling interests based on the relative ownership percentages of LLC Interests held during the period by Tradeweb Markets Inc. and the other holders of LLC Interests. The following table summarizes the ownership interest in Tradeweb Markets LLC: December 31, 2020 December 31, 2019 LLC Ownership LLC Ownership Number of LLC Interests held by Tradeweb Markets Inc. 195,008,657 85.1 % 163,341,520 73.4 % Number of LLC Interests held by non-controlling interests 34,011,202 14.9 % 59,182,155 26.6 % Total LLC Interests outstanding 229,019,859 100 % 222,523,675 100 % LLC Interests held by the Continuing LLC Owners are redeemable in accordance with the TWM LLC Agreement at the election of the members for shares of Class A common stock or Class B common stock, on a one-for-one basis or, at the Company's option, a cash payment in accordance with the terms of the TWM LLC Agreement. See Note 10 – Stockholders’ Equity. The following table summarizes the impact on equity due to changes in the Corporation’s ownership interest in TWM LLC (in thousands): Successor Successor Net Income Attributable to Tradeweb Markets Inc. and Transfers (to) from the Non-Controlling Interests Year Ended December 31, Year Ended December 31, Net income attributable to Tradeweb Markets Inc. $ 166,296 $ 83,769 Transfers (to) from non-controlling interests: Allocation of equity to non-controlling interests arising from the reorganization transactions and IPO — (1,607,529) Change in non-controlling interests as a result of ownership changes 533,900 402,227 Net transfers (to) from non-controlling interests 533,900 (1,205,302) Change from net income attributable to Tradeweb Markets Inc. and transfers (to) from non-controlling interests $ 700,196 $ (1,121,533) |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation Plans | Stock-Based Compensation Plans Under the Omnibus Equity Plan, the Company is authorized to issue up to 8,841,864 new shares of Class A common stock to employees, officers and non-employee directors. Under this plan, the Company may grant awards in respect of shares of Class A common stock, including performance-based restricted share units (“PRSUs”), stock options, restricted stock units (“RSUs”) and dividend equivalent rights. The awards may have performance-based and time-based vesting conditions. Stock options have a maximum contractual term of 10 years. PRSUs (Equity-Settled) PRSUs are promises to issue actual shares of Class A common stock at the end of a three-year cliff vesting period. The fair value of the equity-settled PRSUs is calculated on the grant date using the stock price of the Class A common stock. The number of shares a participant will receive upon vesting is determined by a performance modifier, which is adjusted as a result of the financial performance of the Company in the grant year. The performance modifier can vary between 0% (minimum) and 200% (maximum) of the target (100%) award amount. On December 31, 2018, certain PRSUs, which were previously cash-settled, were converted to equity-settled PRSUs. No equity-settled PRSUs were granted by the Company prior to December 31, 2018. The conversion was at fair value, using a unit price consistent with the share price of the Company, and as a result of the impact of the performance modifier on PRSUs value, 1,033.2 cash-settled PRSUs were converted into the equivalent value of 2,000,384 equity-settled PRSUs, adjusted retroactively for the recapitalization of TWM LLC described in Note 10 – Stockholders’ Equity, having vesting terms similar to the cash-settled PRSUs. As a result of the modification, which impacted 54 employees, the Company reclassified $19.1 million from employee equity compensation payable to members’ capital in the December 31, 2018 statement of financial condition. A summary of the Company’s outstanding equity-settled PRSUs is presented below: Equity-Settled Weighted Equity - settled PRSUs outstanding at December 31, 2019 3,490,666 $ 14.59 Grants 360,609 $ 38.87 Vests (861,277) $ 9.53 Performance adjustment 360,609 $ 38.87 Forfeitures and adjustments 5,523 $ 13.99 Equity - settled PRSUs outstanding at December 31, 2020 3,356,130 $ 21.09 The following table summarizes information about equity-settled PRSU awards (in thousands): Successor Successor Year Ended December 31, Year Ended December 31, Equity-settled PRSU compensation expense $ 27,809 $ 25,392 Income tax benefit $ (10,261) $ (4,781) The total fair value of PRSUs vested during the year was $39.8 million for the year ended December 31, 2020. The weighted-average grant date fair value of PRSUs granted in 2019 was $21.08. Options Prior to the IPO, the Company awarded options to management and other employees under the Option Plan. Each option award vests one half based solely on the passage of time and one half only if the Company achieves certain performance targets. The time vesting portion of the options has a four-year graded vesting schedule, with accelerated vesting for time-based options granted prior to the IPO. The Company can elect to net-settle exercised options by reducing the shares of Class A common stock to be issued upon such exercise by the number of shares of Class A common stock having a fair market value on the date of exercise equal to the aggregate option price and withholding taxes payable in respect of the number of options exercised. The Company may then pay these employee payroll taxes from the Company’s cash. In accounting for options issued under the Option Plan, or which may be issued under the Omnibus Equity Plan in the future, the Company measures and recognizes compensation expense for all awards based on their estimated fair values measured as of the grant date. Subsequent to the IPO, the Company awarded additional options with a four-year graded vesting schedule, one half vesting based solely on the passage of time and one half vesting only if the Company achieves certain performance targets. Costs related to options are recognized as an expense in the consolidated statements of income over the requisite service period, when exercisability is considered probable, with an offsetting increase to additional paid-in capital. As a result, expense recognition commenced upon the completion of the IPO, with $18.9 million recognized as compensation expense related to options issued under the Option Plan immediately upon the completion of the IPO. The fair value of options is calculated on the grant date using the Black-Scholes model. The significant assumptions used to estimate the fair value as of grant date of the options awarded prior to the IPO did not reflect changes that would have occurred to these assumptions as a result of the IPO. A summary of the Company’s outstanding options is presented below: Options Weighted Options outstanding at December 31, 2019 17,739,744 $ 2.19 Grants — $ — Exercises (8,504,872) $ 1.81 Forfeitures and adjustments 7,011 $ 1.69 Options outstanding at December 31, 2020 9,241,883 $ 2.54 Vested options outstanding at December 31, 2020 4,112,473 $ 1.95 The following table summarizes information about options awards (in thousands): Successor Successor Year Ended December 31, Year Ended December 31, Options compensation expense $ 6,118 $ 24,432 Income tax benefit $ (57,457) $ (8,556) The total intrinsic value of options exercised during the year was $291.8 million and $21.3 million for the years ended December 31, 2020 and 2019. The weighted-average grant date fair value of options granted in 2019 was $8.83. The significant assumptions used to estimate the fair value of the options as of the grant date were as follows: Weighted Average Expected Life (years) 5.7 Weighted Average Risk-Free Interest Rate 2.9 % Weighted Average Expected Volatility 20.0 % Weighted Average Expected Dividend Yield 3.9 % Weighted Average Share Price $ 21.62 Weighted Average Exercise Price $ 21.62 RSUs In 2020, the Company expanded its restricted stock unit (“RSU”) grants under the Omnibus Equity Plan to employees. Previously, RSU grants were limited to non-employee directors. RSUs are promises to issue shares of Class A common stock at the end of a vesting period. RSUs granted to employees vest one-third each year over a three-year period. RSUs granted to non-employee directors vest after one year. The fair value of the RSUs is calculated on the grant date using the stock price of the Class A common stock. A summary of the Company’s outstanding RSUs is presented below: RSUs Weighted RSUs outstanding at December 31, 2019 — $ — Grants 493,878 $ 38.91 Vests — $ — Forfeitures — $ — RSUs outstanding at December 31, 2020 493,878 $ 38.91 The following table shows a summary of RSU activity during the year ended December 31, 2020 (in thousands): Successor Year Ended December 31, RSU compensation expense $ 5,359 Income tax benefit $ (311) Compensation Expense The Company records stock-based compensation expense for employees and directors in the consolidated statements of income. The total stock-based compensation expense for the year ended December 31, 2020, the year ended December 31, 2019, the 2018 Successor Period, and the 2018 Predecessor Period is $40.1 million, $50.7 million, $9.4 million, and $15.9 million, respectively. As of December 31, 2020, total unrecognized compensation expense related to unvested stock-based compensation arrangements and the expected recognition period are as follows (dollars in thousands): Equity-Settled Options RSUs Total unrecognized compensation cost $ 31,355 $ 3,140 $ 13,927 Weighted-average recognition period 1.64 years 1.97 years 2.20 years |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions The Company enters into transactions with its affiliates from time to time which are considered to be related party transactions. Prior to the Reorganization Transactions, the Bank Stockholders were collectively considered to be related parties of the Company. As a result of the Reorganization Transactions, they are no longer considered to be related parties. As a result, the related party transactions listed below include transactions with the Bank Stockholders or their respective affiliates for pre-IPO periods only. At December 31, 2020 and 2019, the following balances with such affiliates were included in the consolidated statements of financial condition in the following line items (in thousands): Successor Successor December 31, 2020 December 31, 2019 Accounts receivable $ 4,009 $ — Receivable from affiliates 111 2,525 Other Assets 2,722 2,731 Accounts payable, accrued expenses and other liabilities 6,140 — Deferred revenue 4,500 4,733 Payable to affiliates 5,142 1,506 The following balances with such affiliates were included in the consolidated statements of income in the following line items (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 January 1, 2018 Revenue: Transaction fees (1) $ — $ 59,643 $ 59,259 $ 159,663 Subscription fees (1) — 5,670 5,718 16,627 Commissions (1) — 16,186 12,401 34,944 Refinitiv market data fees (2) 59,706 55,635 13,467 36,851 Operating Income: Net interest income (expense) (3) — 858 17 34 Shared Services Fees (4) : Technology and communications 2,960 2,960 740 2,220 General and administrative (591) 430 180 539 Occupancy 15 481 155 466 (1) For pre-IPO periods, represents fees and commissions from affiliates of the Bank Stockholders. (2) The Company maintains a market data license agreement with Refinitiv (TR in the predecessor period). Under the agreement, the Company delivers to Refinitiv certain market data feeds which Refinitiv redistributes to its customers. The Company earns license fees and royalties for these feeds. (3) For pre-IPO periods, represents interest income from money market funds invested with and savings accounts deposited with affiliates of the Bank Stockholders. (4) The Company maintains a shared services agreement with Refinitiv (TR in the predecessor period). Under the terms of the agreement, Refinitiv provides the Company with certain real estate, payroll, benefits administration, insurance, content, financial reporting and tax support. The Company reimburses affiliates of Refinitiv (TR in the predecessor period) for expenses paid on behalf of the Company for various services including salaries and bonuses, marketing, professional fees, communications, data costs and certain other administrative services. For the year ended December 31, 2020, the year ended December 31, 2019, the 2018 Successor Period and the 2018 Predecessor Period, the Company reimbursed such affiliates approximately $2.4 million, $6.7 million, $3.8 million, and $28.7 million, respectively, for these expenses. The Company engaged Blackstone Advisory Partners L.P., an affiliate of Blackstone, to provide certain financial consulting services in connection with the IPO, the October 2019 follow-on offering and the April 2020 follow-on offering for fees of $1.0 million, $0.5 million and $0.5 million, respectively, which fe es, with respect to the October 2019 follow-on offering and the April 2020 follow-on offering, were reimbursed by the underwriters. $2.0 million is included in additional paid-in capital on the December 31, 2020 consolidated statement of financial condition related to these offeri ng costs. During 2014, the Company issued Class A Shares and unvested Class P-1(A) Shares to some of the Bank Stockholders as a result of a $120.0 million capital contribution. In connection with this investment, employees invested $5.3 million in the Company and were issued Class C Shares and unvested Class P-1(C) Shares. Certain Class P-1(A) Shares and Class P-1(C) Shares vested on July 31, 2018, based on a formula determined by the Company’s new credit platforms’ revenues and any remaining unvested Class P-1(A) Shares and Class P-1(C) Shares were cancelled and as a result no contingent consideration has been recognized related to these shares subsequent to that date. The Company recognized contingent consideration for the 2018 Predecessor Period of $26.8 million relating to these shares, which is included in net revenue on the consolidated statements of income. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Financial Instruments Measured at Fair Value The Company's financial instruments measured at fair value on the consolidated statements of financial condition as of December 31, 2020 and 2019, have been categorized based upon the fair value hierarchy as follows: Successor Quoted Prices in Significant Observable Inputs (Level 2) Significant Total As of December 31, 2020 Assets Money market funds $ 541,790 $ — $ — $ 541,790 $ 541,790 $ — $ — $ 541,790 As of December 31, 2019 Assets Money market funds $ 219,158 $ — $ — $ 219,158 $ 219,158 $ — $ — $ 219,158 The Company's money market funds are classified within level 1 of the fair value hierarchy because they are valued using quoted market prices in active markets. Financial Instruments Not Measured at Fair Value The Company's financial instruments not measured at fair value on the consolidated statements of financial condition as of December 31, 2020 and 2019, have been categorized based upon the fair value hierarchy as follows: Successor Carrying Value Quoted Prices in Significant Observable Inputs (Level 2) Significant Total As of December 31, 2020 Assets Cash $ 250,490 $ 250,490 $ — $ — $ 250,490 Receivable from brokers and dealers and clearing organizations 368 — 368 — 368 Deposits with clearing organizations 11,671 11,671 — — 11,671 Accounts receivable 105,286 — 105,286 — 105,286 Memberships in clearing organizations 1,586 — — 1,586 1,586 $ 369,401 $ 262,161 $ 105,654 $ 1,586 $ 369,401 Liabilities Payable to brokers and dealers and clearing organizations $ 252 $ — $ 252 $ — $ 252 $ 252 $ — $ 252 $ — $ 252 As of December 31, 2019 Assets Cash $ 242,553 $ 242,553 $ — $ — $ 242,553 Receivable from brokers and dealers and clearing organizations 30,641 — 30,641 — 30,641 Deposits with clearing organizations 9,724 9,724 — — 9,724 Accounts receivable 92,814 — 92,814 — 92,814 Memberships in clearing organizations 1,575 — — 1,575 1,575 $ 377,307 $ 252,277 $ 123,455 $ 1,575 $ 377,307 Liabilities Payable to brokers and dealers and clearing organizations $ 30,452 $ — $ 30,452 $ — $ 30,452 $ 30,452 $ — $ 30,452 $ — $ 30,452 The carrying value of financial instruments not measured at fair value classified within level 1 or level 2 of the fair value hierarchy approximates fair value because of the relatively short term nature of the underlying assets or liabilities. The memberships in clearing organizations, which are included in other assets on the consolidated statements of financial condition, are classified within level 3 of the fair value hierarchy because the valuation requires assumptions that are both significant and unobservable. Financial Instruments Without Readily Determinable Fair Values Included in other assets on the consolidated statements of financial condition are equity investments without readily determinable fair values of $21.1 million and $1.1 million at December 31, 2020 and 2019, respectively. There were no impairments or adjustments to the carrying value of equity investments without readily determinable fair values during the years ended December 31, 2020 and 2019. |
Credit Risk
Credit Risk | 12 Months Ended |
Dec. 31, 2020 | |
Risks and Uncertainties [Abstract] | |
Credit Risk | Credit RiskIn the normal course of business the Company, as agent, executes transactions with, and on behalf of, other brokers and dealers. If the agency transactions do not settle because of failure to perform by either counterparty, the Company may be obligated to discharge the obligation of the non-performing party and, as a result, may incur a loss if the market value of the security is different from the contract amount of the transaction. A substantial number of the Company's transactions are collateralized and executed with, and on behalf of, a limited number of broker-dealers. The Company's exposure to credit risk associated with the nonperformance of these clients in fulfilling their contractual obligations pursuant to securities transactions can be directly impacted by volatile trading markets which may impair the clients' ability to satisfy their obligations to the Company. From time to time, the Company enters into agreements to repurchase to facilitate the clearance of securities. Credit exposure related to these agreements to repurchase, including the risk related to a decline in market value of collateral (pledged or received), is managed by entering into agreements to repurchase with overnight or short-term maturity dates and only entering into repurchase transactions with netting members of the Fixed Income Clearing Corporation (“FICC”). The FICC requires dealer netting members to maintain a minimum of $25.0 million in equity capital and $10.0 million in excess net capital (as defined in Rule 15c3-1 under the Securities Exchange Act of 1934). The FICC operates a continuous net settlement system, whereby as trades are submitted and compared the FICC becomes the counterparty. The FICC also marks to market collateral on a daily basis, requiring member firms to pay or receive margin amounts as part of their daily funds settlement. The Company does not expect nonperformance by counterparties in the above situations. However, the Company's policy is to monitor its market exposure and counterparty risk. In addition, the Company has a policy of reviewing, as considered necessary, the credit standing of each counterparty with which it conducts business. Allowance for Credit Losses The Company may be exposed to credit risk regarding its receivables, which are primarily receivables from financial institutions, including investment managers and broker-dealers. At December 31, 2020, the Company maintained an allowance for credit losses of $0.2 million with regard to these receivables. At December 31, 2019, the allowance for doubtful accounts was $0.2 million. The Company maintains an allowance for credit losses based upon an estimate of the amount of potential credit losses in existing accounts receivable, as determined from a review of aging schedules, past due balances, historical collection experience and other specific account data. Careful analysis of the financial condition of our counterparties is also performed. The Company has evaluated its loss assumptions as a result of the COVID-19 pandemic and determined the current estimate of expected credit losses remains reasonable due to continued strong collections and no deterioration in the accounts receivable aging. Account balances are pooled based on the following risk characteristics: 1. Geographic location 2. Transaction fee type (billing type) 3. Legal entity Write-Offs Once determined uncollectable, aged balances are written off as credit loss expense. This determination is based on careful analysis of individual receivables and aging schedules, which are disaggregated based on the risk characteristics described above. Based on current policy, this generally occurs when the receivable is 360 days past due. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies In the normal course of business, the Company enters into user agreements with its dealers which provide the dealers with indemnification from third parties in the event that the electronic marketplaces of the Company infringe upon the intellectual property or other proprietary right of a third party. The Company's exposure under these user agreements is unknown as this would involve estimating future claims against the Company which have not yet occurred. However, based on its experience, the Company expects the risk of a material loss to be remote. The Company has been named as a defendant, along with other financial institutions, in antitrust class actions (consolidated into two actions) relating to trading practices in United States Treasury securities auctions. The Company has filed a motion to dismiss the actions, believes it has substantial defenses to the other plaintiff's claims and intends to defend itself vigorously. Additionally, the Company was dismissed from a class action relating to an interest rate swaps matter in 2017, but that matter continues against the remaining defendant financial institutions. The Company records its best estimate of a loss, including estimated defense costs, when the loss is considered probable and the amount of such loss can be reasonably estimated. Based on its experience, the Company believes that the amount of damages claimed in a legal proceeding is not a meaningful indicator of the potential liability. At this time, the Company cannot reasonably predict the timing or outcomes of, or estimate the amount of loss, or range of loss, if any, related to its pending legal proceedings, including the matters described above, and therefore does not have any contingency reserves established for any of these matters. Revolving Credit Facility On April 8, 2019, the Company entered into a five year, $500 million senior secured revolving credit facility (“Credit Facility”) with a syndicate of banks. The Credit Facility provides additional borrowing capacity to be used to fund ongoing working capital needs, letters of credit and for general corporate purposes, including potential future acquisitions and expansions. On November 7, 2019, TWM LLC entered into an amendment to the Revolving Credit Facility among TWM LLC and the lenders party thereto, which revised the Revolving Credit Facility to permit the recently consummated LSEG Transaction. The amendment did not otherwise impact the terms of the Revolving Credit Facility and did not impact the amount of borrowings available to TWM LLC under the Revolving Credit Facility. Under the terms of the credit agreement that governs the Credit Facility, borrowings under the Credit Facility bear interest at a rate equal to, at the Company’s option, either (a) a base rate equal to the greatest of (i) the administrative agent’s prime rate, (ii) the federal funds effective rate plus ½ of 1.0% and (iii) one month LIBOR plus 1.0%, in each case plus 0.75%, or (b) LIBOR plus 1.75%, subject to a 0.00% floor. The credit agreement also includes a commitment fee of 0.25% for available but unborrowed amounts and other administrative fees that are payable quarterly. The Credit Facility is available until April 2024, provided the Company is in compliance with all covenants. Financial covenant requirements include maintaining minimum ratios related to interest coverage and leverage. As of December 31, 2020, there were no amounts outstanding under the Credit Facility. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share In April 2019, the Company completed the Reorganization Transactions and the IPO, which, among other things, resulted in the Corporation becoming the successor of TWM LLC for financial reporting purposes. As a result, earnings per share information for the pre-IPO period is not comparable to earnings per share information for the post-IPO period. Thus, earnings per share information is being presented separately for the pre-IPO and post-IPO periods. The following table summarizes the basic and diluted earnings per share calculations for Tradeweb Markets Inc. (post-IPO period): Successor Successor EPS: Post-IPO net income attributable to Tradeweb Markets Inc. Year Ended Year Ended (in thousands, except share and per share amounts) Numerator: Post-IPO net income attributable to Tradeweb Markets Inc. $ 166,296 $ 83,769 Denominator: Weighted average shares of Class A and Class B common stock outstanding - Basic 180,409,462 148,013,274 Dilutive effect of equity-settled PRSUs 2,472,801 2,464,137 Dilutive effect of options 5,179,109 6,062,835 Dilutive effect of RSUs 161,660 Weighted average shares of Class A and Class B common stock outstanding - Diluted 188,223,032 156,540,246 Earnings per share - Basic $ 0.92 $ 0.57 Earnings per share - Diluted $ 0.88 $ 0.54 ______________________ The following table summarizes the basic and diluted earnings per share calculations for Tradeweb Markets LLC (pre-IPO period): Successor Successor Predecessor EPS: Pre-IPO net income attributable to Tradeweb Markets LLC (1) Year Ended December 31, 2019 October 1, 2018 to January 1, 2018 to (in thousands, except share and per share amounts) Numerator: Pre-IPO net income attributable to Tradeweb Markets LLC $ 42,352 $ 29,307 $ 130,160 Denominator: Weighted average LLC Interests outstanding - Basic 222,222,197 222,221,628 215,365,920 Dilutive effect of equity-settled PRSUs 1,098,260 22,223 — Weighted average LLC Interests outstanding - Diluted 223,320,457 222,243,851 215,365,920 Earnings per share - Basic $ 0.19 $ 0.13 $ 0.60 Earnings per share - Diluted $ 0.19 $ 0.13 $ 0.60 (1) Earnings per share and weighted average shares outstanding for the pre-IPO periods have been computed to give effect to the Reorganization Transactions, including the amendment and restatement of the TWM LLC Agreement to, among other things, (i) provide for LLC Interests and (ii) exchange all of the then existing membership interests in TWM LLC for LLC interests. For the year ended December 31, 2020, there were approximately 264,819 average shares underlying RSUs and options that were anti-dilutive. As a result, these shares, which are still outstanding, were excluded from the computation of diluted earnings per share. For the year ended December 31, 2019, there were approximately 128,125 average shares underlying equity-settled PRSUs and options that were anti-dilutive and thus excluded from the computation of diluted earnings per share. LLC Interests held by the Continuing LLC Owners are redeemable in accordance with the TWM LLC Agreement, at the election of such holders, for shares of Class A or Class B common stock of Tradeweb Markets Inc. After evaluating the potential dilutive effect under the if-converted method, the 45,828,289 weighted-average LLC Interests for the assumed exchange of non-controlling interests were determined to be anti-dilutive and thus were excluded from the computation of diluted earnings per share for the year ended December 31, 2020. Shares of Class C and Class D common stock do not have economic rights in Tradeweb Markets Inc. and, therefore, are not included in the calculation of basic earnings per share and are not participating securities for purposes of the computation of diluted earnings per share. |
Regulatory Capital Requirements
Regulatory Capital Requirements | 12 Months Ended |
Dec. 31, 2020 | |
Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract] | |
Regulatory Capital Requirements | Regulatory Capital Requirements TWL, DW and TWD are subject to the Uniform Net Capital Rule 15c3‑1 under the Securities Exchange Act of 1934. TEL is subject to certain financial resource requirements with the FCA in the UK, TWJ is subject to certain financial resource requirements with the FCA in Japan and TWEU is subject to certain finance resource requirements with the AFM in the Netherlands. At December 31, 2020 and 2019, the regulatory capital requirements and regulatory capital for TWL, DW, TWD, TEL, TWJ and TWEU are as follows (in thousands): As of December 31, 2020 TWL DW TWD TEL TWJ TWEU Regulatory Capital $ 49,254 $ 58,026 $ 20,577 $ 59,238 $ 11,066 $ 19,102 Regulatory Capital Requirement 2,438 2,147 731 33,742 3,799 2,562 Excess Regulatory Capital $ 46,816 $ 55,879 $ 19,846 $ 25,496 $ 7,267 $ 16,540 As of December 31, 2019 TWL DW TWD TEL TWJ TWEU Regulatory Capital $ 42,317 $ 52,016 $ 33,807 $ 49,611 $ 11,851 $ 6,217 Regulatory Capital Requirement 2,396 2,026 664 21,856 8,565 1,701 Excess Regulatory Capital $ 39,921 $ 49,990 $ 33,143 $ 27,755 $ 3,286 $ 4,516 As SEFs, TW SEF and DW SEF are required to maintain adequate financial resources and liquid financial assets in accordance with CFTC regulations. The required and maintained financial resources and liquid financial assets at December 31, 2020 and 2019 are as follows (in thousands): As of December 31, 2020 As of December 31, 2019 TW SEF DW SEF TW SEF DW SEF Financial Resources $ 28,476 $ 15,298 $ 21,303 $ 13,707 Required Financial Resources 13,500 6,223 10,500 5,505 Excess Financial Resources $ 14,976 $ 9,075 $ 10,803 $ 8,202 Liquid Financial Assets $ 15,662 $ 8,610 $ 18,168 $ 7,583 Required Liquid Financial Assets 6,750 3,112 5,250 2,753 Excess Liquid Financial Assets $ 8,912 $ 5,498 $ 12,918 $ 4,830 |
Business Segment and Geographic
Business Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Business Segment and Geographic Information | Business Segment and Geographic Information The Company operates electronic marketplaces for the trading of products across the rates, credit, equities and money markets asset classes and provides related pre-trade and post-trade services. The Company’s operations constitute a single business segment because of the integrated nature of these marketplaces and services. Information regarding revenue by client sector is as follows (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Net revenue: Institutional $ 554,330 $ 453,379 $ 103,971 $ 301,918 Wholesale 185,456 171,096 38,153 99,028 Retail 76,352 80,368 19,780 57,766 Market Data 76,521 70,723 16,733 47,059 Contingent consideration — — — (26,830) Net revenue 892,659 775,566 178,637 478,941 Operating expenses 629,304 585,747 146,702 338,607 Operating income $ 263,355 $ 189,819 $ 31,935 $ 140,334 The Company operates in the U.S. and internationally, primarily in the Europe and Asia regions. Revenues are attributed to geographic area based on the jurisdiction where the underlying transactions take place. The results by geographic region are not meaningful in understanding the Company's business. Long-lived assets are attributed to the geographic area based on the location of the particular subsidiary. The following table provides revenue by geographic area (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Net Revenue: U.S. $ 570,064 $ 497,316 $ 115,907 $ 324,304 International 322,595 278,250 62,730 181,467 Gross revenue 892,659 775,566 178,637 505,771 Contingent consideration — — — (26,830) Total $ 892,659 $ 775,566 $ 178,637 $ 478,941 The following table provides information on the attribution of long-lived assets by geographic area (in thousands): Successor Successor December 31, December 31, Long-lived assets U.S. $ 4,091,569 $ 4,200,133 International 16,544 14,100 Total $ 4,108,113 $ 4,214,233 |
Quarterly Results of Operations
Quarterly Results of Operations (Unaudited) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Results of Operations (Unaudited) | Quarterly Results of Operations (Unaudited)The following tables set forth certain unaudited financial data for the Company’s quarterly operations in 2020 and 2019. The following information has been prepared on the same basis as the annual information presented elsewhere in this report and, in the opinion of management, includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the information for the quarterly periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. Tradeweb Markets Inc. (post-IPO) Tradeweb Markets LLC (pre-IPO) Successor Successor Successor Successor Successor Successor Successor Successor Three Months Ended December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, Revenues (in thousands, except share and per share data) Transaction fees $ 134,922 $ 120,582 $ 122,146 $ 140,824 $ 104,245 $ 112,746 $ 103,952 $ 102,640 Subscription fees 36,652 36,217 35,006 34,483 34,333 35,387 34,566 34,445 Commissions 42,913 39,593 38,115 42,493 41,165 37,590 36,413 34,197 Refinitiv market data fees 16,240 14,273 14,565 14,628 15,383 13,251 13,385 13,616 Other 2,349 2,205 2,275 2,178 2,182 2,007 2,169 1,894 Gross revenue 233,076 212,870 212,107 234,606 197,308 200,981 190,485 186,792 Contingent consideration — — — — — — — — Net revenue 233,076 212,870 212,107 234,606 197,308 200,981 190,485 186,792 Expenses Employee compensation and benefits 86,305 83,967 88,866 90,520 76,545 79,644 95,995 77,273 Depreciation and amortization 39,837 38,857 37,919 37,176 36,402 35,133 34,292 33,503 Technology and communications 13,103 12,037 12,042 10,318 10,199 9,527 9,519 10,040 General and administrative 10,302 8,657 7,523 8,340 8,999 7,507 9,365 9,089 Professional fees 7,967 7,388 6,609 6,911 7,048 7,272 6,738 6,971 Occupancy 3,982 3,443 3,509 3,726 3,786 3,640 3,621 3,639 Total expenses 161,496 154,349 156,468 156,991 142,979 142,723 159,530 140,515 Operating income 71,580 58,521 55,639 77,615 54,329 58,258 30,955 46,277 Tax receivable agreement liability adjustment 11,425 — — — 33,134 — — — Net interest income (380) (349) (286) 699 704 636 175 858 Income before taxes 82,625 58,172 55,353 78,314 88,167 58,894 31,130 47,135 Provision for income taxes (16,176) (11,124) (12,945) (15,829) (30,889) (10,316) (6,314) (4,783) Net income 66,449 47,048 42,408 62,485 57,278 48,578 24,816 $ 42,352 Net income attributable to non-controlling interests 11,389 10,236 11,912 18,557 15,949 18,966 11,988 Net income attributable to Tradeweb Markets Inc. $ 55,060 $ 36,812 $ 30,496 $ 43,928 $ 41,329 $ 29,612 $ 12,828 Earnings per share (1) Basic $ 0.29 $ 0.20 $ 0.17 $ 0.26 $ 0.26 $ 0.21 $ 0.09 $ 0.19 Diluted $ 0.28 $ 0.19 $ 0.16 $ 0.25 $ 0.25 $ 0.20 $ 0.09 $ 0.19 Weighted average shares outstanding Basic 189,795,356 187,774,170 177,649,501 166,234,749 157,950,550 142,935,206 142,933,192 222,222,197 Diluted 197,745,297 194,955,695 185,489,824 174,517,244 167,323,520 151,362,643 150,847,183 223,320,457 (1) In April 2019, the Company completed the Reorganization Transactions and the IPO, which, among other things, resulted in Tradeweb Markets Inc. becoming the successor of Tradeweb Markets LLC for financial reporting purposes. As a result, earnings per share information for the pre-IPO period is not comparable to the earnings per share information for the post-IPO period. See Note 17—Earnings Per Share for additional information. Earnings per share for quarterly periods are based on the weighted average common shares outstanding in individual quarters; thus, the sum of earnings per share of the quarters may not equal the amounts reported for the full year. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On January 29, 2021, London Stock Exchange Group plc acquired, from a consortium including certain investment funds affiliated with Blackstone as well as TR, the Refinitiv business in an all share transaction (the “LSEG Transaction”). On February 2, 2021, the Company announced that it entered into a definitive agreement to acquire Nasdaq’s U.S. fixed income electronic trading platform. The Nasdaq platform (formerly known as eSpeed) is a fully executable central order limit book (CLOB) for electronic trading in on-the-run (OTR) U.S. Treasuries. Nasdaq’s CLOB will become part of Dealerweb, serving the Company’s wholesale client sector. The $190 million, all-cash transaction is expected to close later in 2021 subject to the satisfaction of customary closing conditions, including the receipt of required regulatory approvals. On February 2, 2021, Tradeweb Markets Inc., as the sole manager, approved a distribution by TWM LLC to its equityholders, including Tradeweb Markets Inc., in an aggregate amount of approximately $18.8 million, as adjusted by required state and local tax withholdings as well as increases in Tradeweb Markets Inc. shares outstanding between January 26, 2021 and the distribution record date of March 1, 2021, payable on March 11, 2021. On February 3, 2021, the board of directors of Tradeweb Markets Inc. declared a cash dividend of $0.08 per share of Class A common stock and Class B common stock for the first quarter of 2021. This dividend will be payable on March 15, 2021 to stockholders of record as of March 1, 2021. On February 4, 2021, the Company announced that the board of directors authorized a new share repurchase program, primarily to offset annual dilution from stock-based compensation plans. The share repurchase program authorizes the purchase of up to $150.0 million of the Company's Class A common stock at the Company's discretion. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Accounting | Basis of Accounting The consolidated financial statements have been presented in conformity with accounting principles generally accepted in the United States of America. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and the difference may be material to the consolidated financial statements. |
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. As discussed in Note 1—Organization, as a result of the Reorganization Transactions, Tradeweb Markets Inc. consolidates TWM LLC and TWM LLC is considered to be the predecessor to Tradeweb Markets Inc. for financial reporting purposes. As a result, the consolidated financial statements for periods prior to the Reorganization Transactions have been adjusted to combine the previously separate entities for presentation purposes. However, Tradeweb Markets Inc. had no business transactions or activities and no substantial assets or liabilities prior to the Reorganization Transactions. As such, for periods prior to the completion of the Reorganization Transactions, the consolidated financial statements represent the historical financial condition and results of operations of TWM LLC and its subsidiaries. For periods after the completion of the Reorganization Transactions, the consolidated financial statements represent the financial condition and results of operations of the Company and report a non-controlling interest related to the LLC Interests held by the Continuing LLC Owners. Pushdown Accounting A majority interest of Refinitiv (formerly the Thomson Reuters Financial & Risk Business) was acquired by BCP on October 1, 2018 (the “Refinitiv Transaction”) from TR. The Refinitiv Transaction was accounted for by Refinitiv in accordance with the acquisition method of accounting pursuant to Accounting Standards Codification (“ASC”) 805, Business Combinations, and pushdown accounting was applied to Refinitiv to record the fair value of the assets and liabilities of Refinitiv as of October 1, 2018, the date of the Refinitiv Transaction. The Company, as a consolidating subsidiary of Refinitiv, also accounted for the Refinitiv Transaction using pushdown accounting. Under pushdown accounting, the excess of the fair value of the Company above the fair value accounting basis of the net assets and liabilities of the Company is recorded as goodwill. The fair value of assets acquired and liabilities assumed was determined based on assumptions that reasonable market participants would use in the principal (or most advantageous) market for the asset or liability. The adjusted valuations primarily affected the values of our long-lived and indefinite-lived intangible assets, including software development costs. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consists of cash and highly liquid investments (such as short-term money market instruments) with original maturities of less than three months. |
Allowance for Doubtful Accounts | Allowance for Credit Losses The Company continually monitors collections and payments from its clients and maintains an allowance for credit losses. The allowance for credit losses is based on an estimate of the amount of potential credit losses in existing accounts receivable, as determined from a review of aging schedules, past due balances, historical collection experience and other specific account data. Careful analysis of the financial condition of our counterparties is also performed. Once determined uncollectable, aged balances are written off as credit loss expense, which is included in general and administrative expenses on the consolidated statements of income. See Note 15 – Credit Risk for additional information. |
Receivables form and Payable to Brokers and Dealers and Clearing Organizations | Receivable from and Payable to Brokers and Dealers and Clearing Organizations Receivable from and payable to brokers and dealers and clearing organizations consists of proceeds from transactions executed on the Company's wholesale platform which failed to settle due to the inability of a transaction party to deliver or receive the transacted security. These securities transactions are generally collateralized by those securities. Until the failed transaction settles, a receivable from (and a matching payable to) brokers and dealers and clearing organizations is recognized for the proceeds from the unsettled transaction. |
Deposits with Clearing Organizations | Deposits with Clearing Organizations Deposits with clearing organizations are comprised of cash deposits. Due to the short-term nature of these deposits, the recorded value has been determined to approximate fair value. |
Furniture, Equipment, Purchased Software and Leasehold Improvements | Furniture, Equipment, Purchased Software and Leasehold Improvements Furniture, equipment, purchased software and leasehold improvements are carried at cost less accumulated depreciation. Depreciation for furniture, equipment and purchased software is computed on a straight-line basis over the estimated useful lives of the related assets, ranging from three Furniture, equipment, purchased software and leasehold improvements are tested for impairment whenever events or changes in circumstances suggest that an asset’s carrying value may not be fully recoverable in accordance with ASC 360, Property, Plant and Equipment. |
Software Development Costs | Software Development Costs The Company capitalizes costs associated with the development of internal use software at the point at which the conceptual formulation, design and testing of possible software project alternatives have been completed, in accordance with ASC 350, Intangibles – Goodwill and Other . The Company capitalizes employee compensation and related benefits and third party consulting costs incurred during the application development stage which directly contribute to such development. Such costs are amortized on a straight-line basis over three years. Costs capitalized as part of the pushdown accounting allocation are amortized over nine years. The Company reviews the amounts capitalized for impairment whenever events or changes in circumstances indicate that the carrying amounts of the assets may not be fully recoverable, or that their useful lives are shorter than originally expected. Non-capitalized software costs and routine maintenance costs are expensed as incurred. |
Goodwill | Goodwill Goodwill is the excess of the fair value of the Company above the fair value accounting basis of the net assets and liabilities of the Company under pushdown accounting. Goodwill is also the cost of acquired companies in excess of the fair value of identifiable net assets at the acquisition date. Goodwill is not amortized, but in accordance with ASC 350, goodwill is tested for impairment annually and between annual tests whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. Goodwill is tested at the reporting unit level, which is defined as an operating segment or one level below the operating segment. An impairment loss is recognized if the estimated fair value of a reporting unit is less than its net book value. Such loss is calculated as the difference between the estimated fair value of goodwill and its carrying value. In 2019, the Company changed the annual date on which goodwill is tested for impairment from July 1st to October 1st to align with the annual impairment testing date of the Company’s Parent. This change did not accelerate, delay, avoid or cause an impairment charge, nor did this change result in adjustments to any previously issued financial statements. Goodwill was last assessed on October 1, 2020 and no impairment of goodwill was identified. |
Intangible Assets | Intangible Assets Intangible assets with a finite life are amortized over the estimated lives, ranging from seven |
Deferred IPO and Follow-On Offering Costs | Deferred IPO and Follow-On Offering Costs The Company began incurring costs in connection with the filing of a Registration Statement on Form S-1 for an IPO in 2018 and Registration Statements on Form S-1 for follow-on offerings in 2019 and 2020. IPO and follow-on offering costs consist of legal, accounting, and other costs directly related to the Company’s efforts to raise capital. In accordance with ASC 505-10-25, Equity |
Translation of Foreign Currency | Translation of Foreign Currency Revenues and expenses denominated in foreign currencies are translated at the rate of exchange prevailing at the transaction date. Assets and liabilities denominated in foreign currencies are translated at the rate prevailing at the consolidated statements of financial condition date. Foreign currency re-measurement gains or losses on transactions in nonfunctional currencies are recognized in the consolidated statements of income. Gains or losses on translation in the financial statements of a non-U.S. operation, when the functional currency is other than the U.S. dollar, are included as a component of comprehensive income. |
Income Tax | Income Tax The Corporation is subject to U.S. federal, state and local income taxes with respect to its taxable income, including its allocable share of any taxable income of TWM LLC, and is taxed at prevailing corporate tax rates. TWM LLC is a multiple member limited liability company taxed as a partnership and accordingly any taxable income generated by TWM LLC is passed through to and included in the taxable income of its members, including the Corporation. Income taxes also include unincorporated business taxes on income earned or losses incurred for conducting business in certain state and local jurisdictions, income taxes on income earned or losses incurred in foreign jurisdictions on certain operations and federal and state income taxes on income earned or losses incurred, both current and deferred, on subsidiaries that are taxed as corporations for U.S. tax purposes. The Company records deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities. The Company measures deferred taxes using the enacted tax rates and laws that will be in effect when such temporary differences are expected to reverse. The Company evaluates the need for valuation allowances based on the weight of positive and negative evidence. The Company records valuation allowances wherever management believes it is more likely than not that the Company will not be able to realize its deferred tax assets in the future. The Company records uncertain tax positions in accordance with ASC 740, Income Taxes , on the basis of a two-step process whereby (i) the Company determines whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties related to income taxes within the provision for income taxes in the consolidated statements of income. Accrued interest and penalties are included within accounts payable, accrued expenses and other liabilities in the consolidated statements of financial condition. The Company has elected to treat taxes due on future U.S. inclusions in taxable income under the global intangible low-taxed income (“GILTI”) provision of the Tax Cuts and Jobs Act as a current period expense when incurred. |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, Compensation – Stock Compensation . ASC 718 focuses primarily on accounting for a transaction in which an entity obtains employee services in exchange for stock-based payments. Under ASC 718, the stock-based payments received by the employees of the Company are accounted for either as equity awards or as liability awards. As an equity award, the Company measures and recognizes the cost of employee services received in exchange for awards of equity instruments based on their estimated fair values measured as of the grant date. These costs are recognized as an expense over the requisite service period, with an offsetting increase to additional paid-in capital. As a liability award, the cost of employee services received in exchange for an award of equity instruments is generally measured based on the grant-date fair value of the award. The fair value of that award is remeasured subsequently at each reporting date through the settlement in accordance with ASC 505. Changes in the equity instrument's fair value during the requisite service period are recognized as compensation cost over that period. For periods following the Reorganization Transactions and the IPO, the fair value of new equity instrument grants is determined based on the price of the Class A common stock on the grant date. Under ASC 718, the grant-date fair value of stock-based awards that do not require future service (i.e., vested awards) are expensed immediately. The grant-date fair value of stock-based awards that require future service, and are graded-vesting awards, are amortized over the relevant service period on a straight-line basis, with each tranche separately measured. The grant-date fair value of stock-based awards that require both future service and the achievement of Company performance-based conditions are amortized over the relevant service period for the performance-based condition. If in a reporting period it is determined that the achievement of a performance target for a performance-based tranche is not probable, then no expense is recognized for that tranche and any expenses already recognized relating to that tranche in prior reporting periods are reversed in the current reporting period. Prior to the IPO, the Company awarded options to management and other employees (collectively, the “Special Option Award”) under the Amended and Restated Tradeweb Markets Inc. Option Plan (the “Option Plan”). In accounting for the options issued under the Option Plan, compensation expense is measured and recognized for all awards based on their estimated fair values measured as of the grant date. Costs related to these options are recognized as an expense in the consolidated statements of income over the requisite service period, with an offsetting increase to additional paid-in capital. The non-cash stock-based compensation expense associated with the Special Option Award began being expensed in the second quarter of 2019. Determining the appropriate fair value model and calculating the fair value of the stock-based awards requires the input of highly subjective assumptions, including the expected life of the stock-based awards and the stock price volatility. The Company uses the Black-Scholes pricing model to value some of its stock-based awards. |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing the net income attributable to the Company's shares by the weighted-average number of the Company's shares outstanding during the period. For purposes of computing diluted earnings per share, the weighted-average number of the Company’s shares reflects the dilutive effect that could occur if securities that qualify as participating securities were converted into or exchanged or exercised for TWM LLC’s shares, in the pre-IPO period, and the Class A or Class B common stock, in the post-IPO period, using the treasury stock method, as applicable. Shares of Class C and Class D common stock do not have economic rights in Tradeweb Markets Inc. and, therefore, are not included in the calculation of basic earnings per share. |
Fair Value Measurement | Fair Value Measurement The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (the exit price). Instruments that the Company owns (long positions) are marked to bid prices, and instruments that the Company has sold, but not yet purchased (short positions) are marked to offer prices. Fair value measurements do not include transaction costs. The fair value hierarchy under ASC 820, Fair Value Measurement prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurements) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy under ASC 820 are described below: Basis of Fair Value Measurement A financial instrument's level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. • Level 1 : Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; • Level 2 : Quoted prices in markets that are not considered to be active or financial instruments for which all significant inputs are observable, either directly or indirectly; • Level 3 : Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable. |
Recent Accounting Pronouncements –Adopted | Recent Accounting Pronouncements – Adopted In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2016-13, Financial Instruments – Credit Losses . The ASU provides new guidance for estimating credit losses on certain types of financial instruments by introducing an approach based on expected losses. ASU 2016-13 was adopted on January 1, 2020 using a modified retrospective method of adoption. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. See Note 15 - Credit Risk for additional information. In January 2017, the FASB issued ASU 2017-4, Intangibles – Goodwill and Other . The ASU simplifies the quantitative goodwill impairment test by eliminating the second step of the test. Under this ASU, impairment will be measured by comparing the estimated fair value of the reporting unit with its carrying value. The new guidance does not amend the optional qualitative assessment of goodwill impairment. ASU 2017-4 was adopted on January 1, 2020. The adoption of this ASU did not impact the Company’s consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. The amendments in this ASU simplify the accounting for income taxes by removing certain exceptions for investments, intraperiod allocations and interim calculations and include additional guidance in order to reduce complexity in accounting for income taxes. ASU 2019-12 is effective for annual periods beginning after December 15, 2020, with early adoption permitted. ASU 2019-12 was early adopted on January 1, 2020. The adoption of this ASU did not have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-2, Leases (Topic 842) , which requires lessees to recognize a right-of-use asset and a lease liability for all leases with an initial term in excess of twelve months. The asset reflects the present value of unpaid lease payments coupled with initial direct costs, prepaid lease payments and lease incentives. The amount of the lease liability is calculated as the present value of unpaid lease payments. ASU 2016-2 was adopted on January 1, 2019 using the modified retrospective method of adoption. Upon adoption, the Company: • Recorded right-of-use assets of $31.8 million, • Recorded a lease liability of $39.6 million, • Eliminated deferred rent of $4.9 million, • Eliminated leasehold interests of $2.9 million, • Elected to take the optional package of practical expedients, which allows for no reassessment of i. whether any expired or existing contracts are or contain leases, ii. the lease classification for any expired or existing leases, and iii. initial direct costs for any existing leases. |
Equity Securities without Readily Determinable Fair Value | Equity Investments Without Readily Determinable Fair Values Equity Investments without a readily determinable fair value are measured at cost, less impairment, plus or minus observable price changes (in orderly transactions) of an identical or similar investment of the same issuer. If the Company determines that the equity investment is impaired on the basis of a qualitative assessment, the Company will recognize an impairment loss equal to the amount by which the investment’s carrying amount exceeds its fair value. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Intangible Assets Which Have an Indefinite Useful Life | Intangible assets with an indefinite useful life consisted of the following at both December 31, 2020 and 2019 (in thousands): Amount Licenses $ 168,800 Tradename 154,300 Total $ 323,100 |
Intangible Assets That are Subject to Amortization | Intangible assets that are subject to amortization consisted of the following (in thousands): Successor Successor December 31, 2020 December 31, 2019 Amortization Cost Accumulated Net Carrying Cost Accumulated Net Carrying Customer relationships 12 years $ 928,200 $ (174,037) $ 754,163 $ 928,200 $ (96,687) $ 831,513 Content and data 7 years 154,400 (49,629) 104,771 154,400 (27,572) 126,828 $ 1,082,600 $ (223,666) $ 858,934 $ 1,082,600 $ (124,259) $ 958,341 |
Estimated Annual Future Amortization for Existing Intangible Assets | The estimated annual future amortization for definite-lived intangible assets through December 31, 2025 is as follows (in thousands): Amount 2021 $ 99,408 2022 $ 99,408 2023 $ 99,408 2024 $ 99,408 2025 $ 93,894 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Activity Related to the Company's Leases | The following is a summary of right-of-use assets and liabilities related to operating leases at both December 31, 2020 and 2019 (in thousands): December 31, 2020 December 31, 2019 Operating lease right-of-use assets $ 29,437 $ 24,504 Operating lease liabilities $ 34,463 $ 30,955 Activity related to the Company's leases for the years ended December 31, 2020 and 2019 is as follows (in thousands): Year Ended December 31, 2020 2019 Operating lease expense $ 10,439 $ 10,265 Cash for amounts included in the measurement of operating liability $ 12,060 $ 11,667 At December 31, 2020 and 2019, the weighted average borrowing rate and weighted average lease term are as follows: December 31, 2020 December 31, 2019 Weighted average borrowing rate 2.9 % 2.9 % Weighted average remaining lease term (years) 4.7 5.9 |
Schedule of Maturity of Lease Liabilities and Future Minimum Lease Payments | The following table presents the maturity of lease liabilities as of December 31, 2020 (in thousands): Amount 2021 $ 11,612 2022 7,653 2023 5,404 2024 4,416 2025 2,690 Thereafter 5,089 Total future lease payments 36,864 Less imputed interest (2,401) Lease liability $ 34,463 At December 31, 2020, the future minimum lease payments were as follows (in thousands): Amount 2021 $ 11,612 2022 7,653 2023 5,404 2024 4,416 2025 2,690 Thereafter 5,089 Total $ 36,864 At December 31, 2019, the future minimum lease payments were as follows (in thousands): Amount 2020 $ 8,516 2021 5,946 2022 4,143 2023 3,956 2024 3,558 Thereafter 7,633 Total $ 33,752 |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Breakdown of Revenues Between Fixed and Variable Revenues | The breakdown of revenues between fixed and variable revenues, in thousands, for the years ended December 31, 2020, December 31, 2019, the 2018 Successor Period and the 2018 Predecessor Period is as follows: Successor Successor Successor Predecessor Year Ended December 31, 2020 Year Ended December 31, 2019 October 1, 2018 to January 1, 2018 to (in thousands) Variable Fixed Variable Fixed Variable Fixed Variable Fixed Revenues Transaction fees $ 413,568 $ 104,906 $ 325,178 $ 98,405 $ 73,800 $ 23,330 $ 208,049 $ 65,702 Subscription Fees including Refinitiv market data fees 1,685 200,379 1,736 192,630 425 46,094 1,305 142,676 Commissions 122,608 40,506 109,995 39,370 22,608 10,232 49,367 30,463 Other 598 8,409 834 7,418 — 2,148 40 8,169 Gross revenue $ 538,459 $ 354,200 $ 437,743 $ 337,823 $ 96,833 $ 81,804 $ 258,761 $ 247,010 |
Schedule of Recognized Revenue and Remaining Deferred Revenue Balance | The recognized revenue and remaining balance is shown below (in thousands): Amount Deferred revenue balance - December 31, 2019 $ 23,990 New billings 108,327 Revenue recognized (109,124) Deferred revenue balance - December 31, 2020 $ 23,193 |
Software Development Cost (Tabl
Software Development Cost (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Capitalized Computer Software, Net [Abstract] | |
Components of Software Development Costs | The components of software development costs, net of accumulated amortization are as follows (in thousands): Successor Successor December 31, December 31, Software development costs $ 235,382 $ 204,336 Accumulated amortization (67,352) (31,250) Software development costs, net of accumulated amortization $ 168,030 $ 173,086 |
Schedule of Non-capitalized Software Costs and Routine Maintenance Costs | Capitalized software development costs and amortization expense are as follows (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 January 1, 2018 Software development costs capitalized $ 31,046 $ 28,681 $ 7,156 $ 19,523 Amortization expense related to capitalized software development costs $ 36,102 $ 26,176 $ 5,074 $ 19,962 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Components of Provisions for Income Taxes | The provision for income taxes consists of the following (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Current: Federal $ (16,529) $ 21,373 $ — $ — State and Local 5,261 11,537 1,235 5,739 Foreign 2,153 4,368 1,212 3,559 Total current tax expense (9,115) 37,278 2,447 9,298 Deferred: Federal 52,845 (88) 680 1,085 State and local 12,572 18,194 288 1,517 Foreign (228) (3,082) — — Total deferred tax expense 65,189 15,024 968 2,602 Total provision for income taxes $ 56,074 $ 52,302 $ 3,415 $ 11,900 |
Reconciliation of the Statutory Tax Rate | A reconciliation of the U.S. federal statutory tax rate to the effective rate is as follows: Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Statutory U.S. federal income tax rate 21.0 % 21.0 % 21.0 % 21.0 % State and local income taxes, net of federal income tax benefit 5.0 3.9 4.7 5.1 Foreign tax rate differential 0.2 (1.1) 3.7 2.5 LLC flow-through structure — — (19.0) (20.2) Non-controlling interest (3.4) (7.2) — — Tax Receivable Agreement adjustment (0.9) (3.1) — — Rate change (0.2) 10.2 — — Equity Compensation (1.8) — — — Other 0.5 (0.5) — — Effective income tax rate 20.4 % 23.2 % 10.4 % 8.4 % |
Components of Deferred Tax Assets (Liabilities) | The components of the Company’s net deferred tax asset (liability) are as follows (in thousands): Successor Successor Year Ended December 31, Year Ended December 31, Deferred tax assets: Investment in partnership $ 509,835 $ 226,241 Net operating losses 21,647 1,753 Tax Receivable Agreement - Interest 13,859 10,395 Employee compensation 23,291 9,888 Tax credits 9,276 8,342 Other 7,150 4,088 Deferred tax assets, gross 585,058 260,707 Valuation Allowance (110) — Total deferred tax assets, net 584,948 260,707 Deferred tax liabilities Goodwill and Intangibles (24,811) (25,829) Total deferred tax liabilities (24,811) (25,829) Total net deferred tax asset (liability) $ 560,137 $ 234,878 |
Components of Uncertain Tax Positions | The components of the Company’s uncertain tax positions are as follows (in thousands): Successor December 31, Gross unrecognized tax benefits as of January 1 $ 6,512 Increase in current year tax positions 722 Increase in prior year tax positions 1,188 Decrease in prior year tax positions (2,908) Acquired tax positions — Settlements — Gross unrecognized tax benefited as of December 31 $ 5,514 |
Stockholders_ Equity (Tables)
Stockholders’ Equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Class of Common Stock Par Value, Votes and Economic Rights | These attributes are summarized in the following table: Class of Par Votes Economic Class A common stock $ 0.00001 1 Yes Class B common stock $ 0.00001 10 Yes Class C common stock $ 0.00001 1 No Class D common stock $ 0.00001 10 No Shares Class A 146,333 Class C 447 Class P (A) 6,887 Class P (C) 2 Class P-1(A) 6,094 Class P-1 (C) 232 |
Non-Controlling Interests (Tabl
Non-Controlling Interests (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Noncontrolling Interest [Abstract] | |
Summary of Ownership Interest in Non-Controlling Interest | The following table summarizes the ownership interest in Tradeweb Markets LLC: December 31, 2020 December 31, 2019 LLC Ownership LLC Ownership Number of LLC Interests held by Tradeweb Markets Inc. 195,008,657 85.1 % 163,341,520 73.4 % Number of LLC Interests held by non-controlling interests 34,011,202 14.9 % 59,182,155 26.6 % Total LLC Interests outstanding 229,019,859 100 % 222,523,675 100 % |
Summary of Impact on Equity Due to Charges in the Company's Ownership Interest in Non-Controlling Interest | The following table summarizes the impact on equity due to changes in the Corporation’s ownership interest in TWM LLC (in thousands): Successor Successor Net Income Attributable to Tradeweb Markets Inc. and Transfers (to) from the Non-Controlling Interests Year Ended December 31, Year Ended December 31, Net income attributable to Tradeweb Markets Inc. $ 166,296 $ 83,769 Transfers (to) from non-controlling interests: Allocation of equity to non-controlling interests arising from the reorganization transactions and IPO — (1,607,529) Change in non-controlling interests as a result of ownership changes 533,900 402,227 Net transfers (to) from non-controlling interests 533,900 (1,205,302) Change from net income attributable to Tradeweb Markets Inc. and transfers (to) from non-controlling interests $ 700,196 $ (1,121,533) |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Equity-Settled PRSUs Issued | A summary of the Company’s outstanding equity-settled PRSUs is presented below: Equity-Settled Weighted Equity - settled PRSUs outstanding at December 31, 2019 3,490,666 $ 14.59 Grants 360,609 $ 38.87 Vests (861,277) $ 9.53 Performance adjustment 360,609 $ 38.87 Forfeitures and adjustments 5,523 $ 13.99 Equity - settled PRSUs outstanding at December 31, 2020 3,356,130 $ 21.09 |
Schedule of Unrecognized Compensation Expense | The following table summarizes information about equity-settled PRSU awards (in thousands): Successor Successor Year Ended December 31, Year Ended December 31, Equity-settled PRSU compensation expense $ 27,809 $ 25,392 Income tax benefit $ (10,261) $ (4,781) The following table summarizes information about options awards (in thousands): Successor Successor Year Ended December 31, Year Ended December 31, Options compensation expense $ 6,118 $ 24,432 Income tax benefit $ (57,457) $ (8,556) As of December 31, 2020, total unrecognized compensation expense related to unvested stock-based compensation arrangements and the expected recognition period are as follows (dollars in thousands): Equity-Settled Options RSUs Total unrecognized compensation cost $ 31,355 $ 3,140 $ 13,927 Weighted-average recognition period 1.64 years 1.97 years 2.20 years |
Schedule of Options Issued | A summary of the Company’s outstanding options is presented below: Options Weighted Options outstanding at December 31, 2019 17,739,744 $ 2.19 Grants — $ — Exercises (8,504,872) $ 1.81 Forfeitures and adjustments 7,011 $ 1.69 Options outstanding at December 31, 2020 9,241,883 $ 2.54 Vested options outstanding at December 31, 2020 4,112,473 $ 1.95 |
Schedule of Assumptions Used to Estimate the Fair Value of The Options | The significant assumptions used to estimate the fair value of the options as of the grant date were as follows: Weighted Average Expected Life (years) 5.7 Weighted Average Risk-Free Interest Rate 2.9 % Weighted Average Expected Volatility 20.0 % Weighted Average Expected Dividend Yield 3.9 % Weighted Average Share Price $ 21.62 Weighted Average Exercise Price $ 21.62 |
Summary of Outstanding RSUs | A summary of the Company’s outstanding RSUs is presented below: RSUs Weighted RSUs outstanding at December 31, 2019 — $ — Grants 493,878 $ 38.91 Vests — $ — Forfeitures — $ — RSUs outstanding at December 31, 2020 493,878 $ 38.91 |
Summary of RSU Activity | The following table shows a summary of RSU activity during the year ended December 31, 2020 (in thousands): Successor Year Ended December 31, RSU compensation expense $ 5,359 Income tax benefit $ (311) |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Related Party Transactions [Abstract] | |
Schedule of Balances From Transactions With Affiliates Included in the Consolidated Statements | At December 31, 2020 and 2019, the following balances with such affiliates were included in the consolidated statements of financial condition in the following line items (in thousands): Successor Successor December 31, 2020 December 31, 2019 Accounts receivable $ 4,009 $ — Receivable from affiliates 111 2,525 Other Assets 2,722 2,731 Accounts payable, accrued expenses and other liabilities 6,140 — Deferred revenue 4,500 4,733 Payable to affiliates 5,142 1,506 |
Schedule of Affiliates Included in the Consolidated Statements of Income | The following balances with such affiliates were included in the consolidated statements of income in the following line items (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 January 1, 2018 Revenue: Transaction fees (1) $ — $ 59,643 $ 59,259 $ 159,663 Subscription fees (1) — 5,670 5,718 16,627 Commissions (1) — 16,186 12,401 34,944 Refinitiv market data fees (2) 59,706 55,635 13,467 36,851 Operating Income: Net interest income (expense) (3) — 858 17 34 Shared Services Fees (4) : Technology and communications 2,960 2,960 740 2,220 General and administrative (591) 430 180 539 Occupancy 15 481 155 466 (1) For pre-IPO periods, represents fees and commissions from affiliates of the Bank Stockholders. (2) The Company maintains a market data license agreement with Refinitiv (TR in the predecessor period). Under the agreement, the Company delivers to Refinitiv certain market data feeds which Refinitiv redistributes to its customers. The Company earns license fees and royalties for these feeds. (3) For pre-IPO periods, represents interest income from money market funds invested with and savings accounts deposited with affiliates of the Bank Stockholders. (4) The Company maintains a shared services agreement with Refinitiv (TR in the predecessor period). Under the terms of the agreement, Refinitiv provides the Company with certain real estate, payroll, benefits administration, insurance, content, financial reporting and tax support. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Measurements | The Company's financial instruments measured at fair value on the consolidated statements of financial condition as of December 31, 2020 and 2019, have been categorized based upon the fair value hierarchy as follows: Successor Quoted Prices in Significant Observable Inputs (Level 2) Significant Total As of December 31, 2020 Assets Money market funds $ 541,790 $ — $ — $ 541,790 $ 541,790 $ — $ — $ 541,790 As of December 31, 2019 Assets Money market funds $ 219,158 $ — $ — $ 219,158 $ 219,158 $ — $ — $ 219,158 |
Fair Value, by Balance Sheet Grouping | The Company's financial instruments not measured at fair value on the consolidated statements of financial condition as of December 31, 2020 and 2019, have been categorized based upon the fair value hierarchy as follows: Successor Carrying Value Quoted Prices in Significant Observable Inputs (Level 2) Significant Total As of December 31, 2020 Assets Cash $ 250,490 $ 250,490 $ — $ — $ 250,490 Receivable from brokers and dealers and clearing organizations 368 — 368 — 368 Deposits with clearing organizations 11,671 11,671 — — 11,671 Accounts receivable 105,286 — 105,286 — 105,286 Memberships in clearing organizations 1,586 — — 1,586 1,586 $ 369,401 $ 262,161 $ 105,654 $ 1,586 $ 369,401 Liabilities Payable to brokers and dealers and clearing organizations $ 252 $ — $ 252 $ — $ 252 $ 252 $ — $ 252 $ — $ 252 As of December 31, 2019 Assets Cash $ 242,553 $ 242,553 $ — $ — $ 242,553 Receivable from brokers and dealers and clearing organizations 30,641 — 30,641 — 30,641 Deposits with clearing organizations 9,724 9,724 — — 9,724 Accounts receivable 92,814 — 92,814 — 92,814 Memberships in clearing organizations 1,575 — — 1,575 1,575 $ 377,307 $ 252,277 $ 123,455 $ 1,575 $ 377,307 Liabilities Payable to brokers and dealers and clearing organizations $ 30,452 $ — $ 30,452 $ — $ 30,452 $ 30,452 $ — $ 30,452 $ — $ 30,452 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | The following table summarizes the basic and diluted earnings per share calculations for Tradeweb Markets Inc. (post-IPO period): Successor Successor EPS: Post-IPO net income attributable to Tradeweb Markets Inc. Year Ended Year Ended (in thousands, except share and per share amounts) Numerator: Post-IPO net income attributable to Tradeweb Markets Inc. $ 166,296 $ 83,769 Denominator: Weighted average shares of Class A and Class B common stock outstanding - Basic 180,409,462 148,013,274 Dilutive effect of equity-settled PRSUs 2,472,801 2,464,137 Dilutive effect of options 5,179,109 6,062,835 Dilutive effect of RSUs 161,660 Weighted average shares of Class A and Class B common stock outstanding - Diluted 188,223,032 156,540,246 Earnings per share - Basic $ 0.92 $ 0.57 Earnings per share - Diluted $ 0.88 $ 0.54 ______________________ The following table summarizes the basic and diluted earnings per share calculations for Tradeweb Markets LLC (pre-IPO period): Successor Successor Predecessor EPS: Pre-IPO net income attributable to Tradeweb Markets LLC (1) Year Ended December 31, 2019 October 1, 2018 to January 1, 2018 to (in thousands, except share and per share amounts) Numerator: Pre-IPO net income attributable to Tradeweb Markets LLC $ 42,352 $ 29,307 $ 130,160 Denominator: Weighted average LLC Interests outstanding - Basic 222,222,197 222,221,628 215,365,920 Dilutive effect of equity-settled PRSUs 1,098,260 22,223 — Weighted average LLC Interests outstanding - Diluted 223,320,457 222,243,851 215,365,920 Earnings per share - Basic $ 0.19 $ 0.13 $ 0.60 Earnings per share - Diluted $ 0.19 $ 0.13 $ 0.60 (1) Earnings per share and weighted average shares outstanding for the pre-IPO periods have been computed to give effect to the Reorganization Transactions, including the amendment and restatement of the TWM LLC Agreement to, among other things, (i) provide for LLC Interests and (ii) exchange all of the then existing membership interests in TWM LLC for LLC interests. |
Regulatory Capital Requiremen_2
Regulatory Capital Requirements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Broker-Dealer, Net Capital Requirement, SEC Regulation [Abstract] | |
Schedule of Regulatory Capital Requirements | At December 31, 2020 and 2019, the regulatory capital requirements and regulatory capital for TWL, DW, TWD, TEL, TWJ and TWEU are as follows (in thousands): As of December 31, 2020 TWL DW TWD TEL TWJ TWEU Regulatory Capital $ 49,254 $ 58,026 $ 20,577 $ 59,238 $ 11,066 $ 19,102 Regulatory Capital Requirement 2,438 2,147 731 33,742 3,799 2,562 Excess Regulatory Capital $ 46,816 $ 55,879 $ 19,846 $ 25,496 $ 7,267 $ 16,540 As of December 31, 2019 TWL DW TWD TEL TWJ TWEU Regulatory Capital $ 42,317 $ 52,016 $ 33,807 $ 49,611 $ 11,851 $ 6,217 Regulatory Capital Requirement 2,396 2,026 664 21,856 8,565 1,701 Excess Regulatory Capital $ 39,921 $ 49,990 $ 33,143 $ 27,755 $ 3,286 $ 4,516 |
Schedule of Financial Resources and Liquid Financial Resources | The required and maintained financial resources and liquid financial assets at December 31, 2020 and 2019 are as follows (in thousands): As of December 31, 2020 As of December 31, 2019 TW SEF DW SEF TW SEF DW SEF Financial Resources $ 28,476 $ 15,298 $ 21,303 $ 13,707 Required Financial Resources 13,500 6,223 10,500 5,505 Excess Financial Resources $ 14,976 $ 9,075 $ 10,803 $ 8,202 Liquid Financial Assets $ 15,662 $ 8,610 $ 18,168 $ 7,583 Required Liquid Financial Assets 6,750 3,112 5,250 2,753 Excess Liquid Financial Assets $ 8,912 $ 5,498 $ 12,918 $ 4,830 |
Business Segment and Geograph_2
Business Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Information Regarding Revenue by Client Sector | The Company’s operations constitute a single business segment because of the integrated nature of these marketplaces and services. Information regarding revenue by client sector is as follows (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Net revenue: Institutional $ 554,330 $ 453,379 $ 103,971 $ 301,918 Wholesale 185,456 171,096 38,153 99,028 Retail 76,352 80,368 19,780 57,766 Market Data 76,521 70,723 16,733 47,059 Contingent consideration — — — (26,830) Net revenue 892,659 775,566 178,637 478,941 Operating expenses 629,304 585,747 146,702 338,607 Operating income $ 263,355 $ 189,819 $ 31,935 $ 140,334 |
Schedule of Revenue and Long-Lived Assets by Geographic Location | The following table provides revenue by geographic area (in thousands): Successor Successor Successor Predecessor Year Ended December 31, Year Ended December 31, October 1, 2018 to January 1, 2018 to Net Revenue: U.S. $ 570,064 $ 497,316 $ 115,907 $ 324,304 International 322,595 278,250 62,730 181,467 Gross revenue 892,659 775,566 178,637 505,771 Contingent consideration — — — (26,830) Total $ 892,659 $ 775,566 $ 178,637 $ 478,941 The following table provides information on the attribution of long-lived assets by geographic area (in thousands): Successor Successor December 31, December 31, Long-lived assets U.S. $ 4,091,569 $ 4,200,133 International 16,544 14,100 Total $ 4,108,113 $ 4,214,233 |
Quarterly Results of Operatio_2
Quarterly Results of Operations (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Operating Results | The operating results for any quarter are not necessarily indicative of results for any future period. Tradeweb Markets Inc. (post-IPO) Tradeweb Markets LLC (pre-IPO) Successor Successor Successor Successor Successor Successor Successor Successor Three Months Ended December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31, Revenues (in thousands, except share and per share data) Transaction fees $ 134,922 $ 120,582 $ 122,146 $ 140,824 $ 104,245 $ 112,746 $ 103,952 $ 102,640 Subscription fees 36,652 36,217 35,006 34,483 34,333 35,387 34,566 34,445 Commissions 42,913 39,593 38,115 42,493 41,165 37,590 36,413 34,197 Refinitiv market data fees 16,240 14,273 14,565 14,628 15,383 13,251 13,385 13,616 Other 2,349 2,205 2,275 2,178 2,182 2,007 2,169 1,894 Gross revenue 233,076 212,870 212,107 234,606 197,308 200,981 190,485 186,792 Contingent consideration — — — — — — — — Net revenue 233,076 212,870 212,107 234,606 197,308 200,981 190,485 186,792 Expenses Employee compensation and benefits 86,305 83,967 88,866 90,520 76,545 79,644 95,995 77,273 Depreciation and amortization 39,837 38,857 37,919 37,176 36,402 35,133 34,292 33,503 Technology and communications 13,103 12,037 12,042 10,318 10,199 9,527 9,519 10,040 General and administrative 10,302 8,657 7,523 8,340 8,999 7,507 9,365 9,089 Professional fees 7,967 7,388 6,609 6,911 7,048 7,272 6,738 6,971 Occupancy 3,982 3,443 3,509 3,726 3,786 3,640 3,621 3,639 Total expenses 161,496 154,349 156,468 156,991 142,979 142,723 159,530 140,515 Operating income 71,580 58,521 55,639 77,615 54,329 58,258 30,955 46,277 Tax receivable agreement liability adjustment 11,425 — — — 33,134 — — — Net interest income (380) (349) (286) 699 704 636 175 858 Income before taxes 82,625 58,172 55,353 78,314 88,167 58,894 31,130 47,135 Provision for income taxes (16,176) (11,124) (12,945) (15,829) (30,889) (10,316) (6,314) (4,783) Net income 66,449 47,048 42,408 62,485 57,278 48,578 24,816 $ 42,352 Net income attributable to non-controlling interests 11,389 10,236 11,912 18,557 15,949 18,966 11,988 Net income attributable to Tradeweb Markets Inc. $ 55,060 $ 36,812 $ 30,496 $ 43,928 $ 41,329 $ 29,612 $ 12,828 Earnings per share (1) Basic $ 0.29 $ 0.20 $ 0.17 $ 0.26 $ 0.26 $ 0.21 $ 0.09 $ 0.19 Diluted $ 0.28 $ 0.19 $ 0.16 $ 0.25 $ 0.25 $ 0.20 $ 0.09 $ 0.19 Weighted average shares outstanding Basic 189,795,356 187,774,170 177,649,501 166,234,749 157,950,550 142,935,206 142,933,192 222,222,197 Diluted 197,745,297 194,955,695 185,489,824 174,517,244 167,323,520 151,362,643 150,847,183 223,320,457 (1) In April 2019, the Company completed the Reorganization Transactions and the IPO, which, among other things, resulted in Tradeweb Markets Inc. becoming the successor of Tradeweb Markets LLC for financial reporting purposes. As a result, earnings per share information for the pre-IPO period is not comparable to the earnings per share information for the post-IPO period. See Note 17—Earnings Per Share for additional information. |
Organization (Details)
Organization (Details) - USD ($) $ / shares in Units, $ in Billions | Apr. 08, 2019 | Dec. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Jun. 28, 2019 |
Weighted average share price (in dollars per share) | $ 21.62 | ||||
Number of shares canceled (in shares) | 96,933,192 | ||||
Class A Common Stock | |||||
Common stock, par value per share (in dollars per share) | 0.00001 | $ 0.00001 | |||
Class B Common Stock | |||||
Common stock, par value per share (in dollars per share) | 0.00001 | 0.00001 | $ 0.00001 | ||
Number of shares canceled (in shares) | 9,993,731 | ||||
Shares contributed by Refinitiv Owner (in shares) | 96,933,192 | ||||
Class C Common Stock | |||||
Common stock, par value per share (in dollars per share) | 0.00001 | 0.00001 | |||
Shares issued to acquire TWM LLC (in shares) | 20,000,000 | ||||
Number of shares canceled (in shares) | 9,993,731 | ||||
Class D Common Stock | |||||
Common stock, par value per share (in dollars per share) | $ 0.00001 | $ 0.00001 | |||
Shares issued to acquire TWM LLC (in shares) | 105,289,005 | ||||
Number of shares canceled (in shares) | 36,006,269 | ||||
TradeWeb Markets Llc | |||||
Ownership interest | 64.30% | 85.10% | 73.40% | ||
Number of LLC Interests held by non-controlling interests | 14.90% | 26.60% | |||
Weighted average share price (in dollars per share) | $ 27 | ||||
Net proceeds | $ 1.2 | ||||
Initial Public Offering | Class A Common Stock | |||||
Issuance of common stock (in shares) | 46,000,000 | ||||
Common stock, par value per share (in dollars per share) | $ 0.00001 | ||||
Weighted average share price (in dollars per share) | $ 27 | ||||
Over-Allotment Option | Class A Common Stock | |||||
Issuance of common stock (in shares) | 6,000,000 | 2,593,181 |
Significant Accounting Polici_3
Significant Accounting Policies - Furniture, Equipment, Purchased Software and Leasehold Improvements and Software Development Cost (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Furniture, Equipment, Purchased Software and Leasehold Improvements | Minimum | |
Furniture, Equipment, Purchased Software and Leasehold Improvements | |
Property, plant, and equipment, useful life | 3 years |
Furniture, Equipment, Purchased Software and Leasehold Improvements | Maximum | |
Furniture, Equipment, Purchased Software and Leasehold Improvements | |
Property, plant, and equipment, useful life | 7 years |
Software Development Costs | |
Furniture, Equipment, Purchased Software and Leasehold Improvements | |
Property, plant, and equipment, useful life | 3 years |
Amortization of pushdown accounting allocation | 9 years |
Significant Accounting Polici_4
Significant Accounting Policies - Intangible Assets (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Minimum | |
Intangible Assets | |
Useful life of intangible assets | 7 years |
Maximum | |
Intangible Assets | |
Useful life of intangible assets | 12 years |
Significant Accounting Polici_5
Significant Accounting Policies - Deferred IPO and Follow-On Offering Costs (Details) $ in Millions | Dec. 31, 2020USD ($) |
Initial Public Offering | |
Subsidiary, Sale of Stock [Line Items] | |
Deferred offering costs | $ 15.9 |
Follow On Offering | |
Subsidiary, Sale of Stock [Line Items] | |
Deferred offering costs | $ 5.2 |
Significant Accounting Polici_6
Significant Accounting Policies - Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | Jan. 01, 2019 | Dec. 31, 2020 | Dec. 31, 2019 |
Lessee, Lease, Description [Line Items] | |||
Right-of-use assets | $ 29,437 | $ 24,504 | |
Lease liability | $ (34,463) | $ (30,955) | |
Package of practical expedients | true | true | |
Cumulative Effect, Period of Adoption, Adjustment | |||
Lessee, Lease, Description [Line Items] | |||
Right-of-use assets | $ 31,800 | ||
Lease liability | 39,600 | ||
Deferred rent | 4,900 | ||
Leasehold Interest | $ 2,900 |
Restricted Cash (Details)
Restricted Cash (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Restricted Cash Equivalents [Abstract] | ||
Restricted cash | $ 1,000 | $ 1,000 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Goodwill | $ 2,694,797 | $ 2,694,797 | ||
Amortization expense | $ 24,900 | $ 19,600 | $ 99,400 | $ 99,400 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Indefinite Lived Intangible Assets (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Intangible assets with indefinite useful lives | ||
Indefinite-lived intangible assets | $ 323,100 | $ 323,100 |
Licenses | ||
Intangible assets with indefinite useful lives | ||
Indefinite-lived intangible assets | 168,800 | 168,800 |
Tradename | ||
Intangible assets with indefinite useful lives | ||
Indefinite-lived intangible assets | $ 154,300 | $ 154,300 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Finite Lived Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Intangible assets that are subject to amortization | ||
Cost | $ 1,082,600 | $ 1,082,600 |
Accumulated Amortization | (223,666) | (124,259) |
Net Carrying Amount | $ 858,934 | $ 958,341 |
Customer relationships | ||
Intangible assets that are subject to amortization | ||
Amortization Period | 12 years | 12 years |
Cost | $ 928,200 | $ 928,200 |
Accumulated Amortization | (174,037) | (96,687) |
Net Carrying Amount | $ 754,163 | $ 831,513 |
Content and data | ||
Intangible assets that are subject to amortization | ||
Amortization Period | 7 years | 7 years |
Cost | $ 154,400 | $ 154,400 |
Accumulated Amortization | (49,629) | (27,572) |
Net Carrying Amount | $ 104,771 | $ 126,828 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Future Amortization (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Estimated annual future amortization for existing intangibles assets | |
2021 | $ 99,408 |
2022 | 99,408 |
2023 | 99,408 |
2024 | 99,408 |
2025 | $ 93,894 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | Jan. 01, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 |
Lessee, Lease, Description [Line Items] | |||||
Right-of-use assets | $ 29,437 | $ 24,504 | |||
Lease liability | 34,463 | 30,955 | |||
Activity related to the Company's leases | |||||
Operating lease expense | 10,439 | 10,265 | |||
Cash for amounts included in the measurement of operating liability | $ 12,060 | $ 11,667 | |||
Weighted average borrowing rate | 2.90% | 2.90% | |||
Weighted average remaining lease term (years) | 4 years 8 months 12 days | 5 years 10 months 24 days | |||
Rent expense | $ 2,700 | $ 9,000 | |||
Package of practical expedients | true | true | |||
ASC 842 | |||||
Activity related to the Company's leases | |||||
Package of practical expedients | true | true | |||
US lease secured by letter of credit | |||||
Activity related to the Company's leases | |||||
Letter of credit guaranteed by Refinitiv | $ 1,200 | ||||
Minimum | |||||
Lessee, Lease, Description [Line Items] | |||||
Initial term of lease | 3 years | ||||
Maximum | |||||
Lessee, Lease, Description [Line Items] | |||||
Initial term of lease | 11 years |
Leases - Maturity of Lease Liab
Leases - Maturity of Lease Liabilities and Future Minimum Lease Payments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Lessee, Operating Lease, Liability, Payment, Due [Abstract] | ||
2021 | $ 11,612 | $ 8,516 |
2022 | 7,653 | 5,946 |
2023 | 5,404 | 4,143 |
2024 | 4,416 | 3,956 |
2025 | 2,690 | 3,558 |
Thereafter | 5,089 | 7,633 |
Total future lease payments | 36,864 | 33,752 |
Less imputed interest | (2,401) | |
Lease liability | $ 34,463 | $ 30,955 |
Revenue - Breakdown of Revenue
Revenue - Breakdown of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | $ 233,076 | $ 212,870 | $ 212,107 | $ 234,606 | $ 197,308 | $ 200,981 | $ 190,485 | $ 186,792 | $ 178,637 | $ 505,771 | $ 892,659 | $ 775,566 |
Variable | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 96,833 | 258,761 | 538,459 | 437,743 | ||||||||
Fixed | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 81,804 | 247,010 | 354,200 | 337,823 | ||||||||
Transaction fees | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 134,922 | 120,582 | 122,146 | 140,824 | 104,245 | 112,746 | 103,952 | 102,640 | 97,130 | 273,751 | 518,474 | 423,583 |
Transaction fees | Variable | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 73,800 | 208,049 | 413,568 | 325,178 | ||||||||
Transaction fees | Fixed | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 23,330 | 65,702 | 104,906 | 98,405 | ||||||||
Subscription Fees including Refinitiv market data fees | Variable | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 425 | 1,305 | 1,685 | 1,736 | ||||||||
Subscription Fees including Refinitiv market data fees | Fixed | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 46,094 | 142,676 | 200,379 | 192,630 | ||||||||
Commissions | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 42,913 | 39,593 | 38,115 | 42,493 | 41,165 | 37,590 | 36,413 | 34,197 | 32,840 | 79,830 | 163,114 | 149,365 |
Commissions | Variable | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 22,608 | 49,367 | 122,608 | 109,995 | ||||||||
Commissions | Fixed | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 10,232 | 30,463 | 40,506 | 39,370 | ||||||||
Other | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | $ 2,349 | $ 2,205 | $ 2,275 | $ 2,178 | $ 2,182 | $ 2,007 | $ 2,169 | $ 1,894 | 2,148 | 8,209 | 9,007 | 8,252 |
Other | Variable | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | 0 | 40 | 598 | 834 | ||||||||
Other | Fixed | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Gross revenue | $ 2,148 | $ 8,169 | $ 8,409 | $ 7,418 |
Revenue - Deferred Revenue (Det
Revenue - Deferred Revenue (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Movement in Deferred Revenue [Roll Forward] | |
Deferred revenue balance - beginning of period | $ 23,990 |
New billings | 108,327 |
Revenue recognized | (109,124) |
Deferred revenue balance - end of period | $ 23,193 |
Software Development Cost (Deta
Software Development Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Software Development Cost | ||||
Software development costs | $ 235,382 | $ 204,336 | ||
Accumulated amortization | (67,352) | (31,250) | ||
Software development costs, net of accumulated amortization | 168,030 | 173,086 | ||
Software development costs capitalized | $ 7,156 | $ 19,523 | 31,046 | 28,681 |
Amortization expense related to capitalized software development costs | $ 5,074 | $ 19,962 | $ 36,102 | $ 26,176 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Tax Disclosure [Line Items] | ||||||||||||
Income before taxes | $ 82,625 | $ 58,172 | $ 55,353 | $ 78,314 | $ 88,167 | $ 58,894 | $ 31,130 | $ 47,135 | $ 32,722 | $ 142,060 | $ 274,464 | $ 225,326 |
Remaining percentage of tax benefits | 50.00% | |||||||||||
Interest accrued | 2,600 | $ 2,600 | ||||||||||
Penalties accrued | 500 | 500 | ||||||||||
Other assets | 82,460 | $ 27,236 | 82,460 | $ 27,236 | ||||||||
Reasonable amount of decrease in uncertain tax benefits | 2,500 | 2,500 | ||||||||||
Refinitiv | ||||||||||||
Income Tax Disclosure [Line Items] | ||||||||||||
Other assets | 2,700 | 2,700 | ||||||||||
Accounts payable, accrued expenses and other liabilities | ||||||||||||
Income Tax Disclosure [Line Items] | ||||||||||||
Accrued income taxes | 2,700 | 2,700 | ||||||||||
United States | ||||||||||||
Income Tax Disclosure [Line Items] | ||||||||||||
Income before taxes | 251,000 | |||||||||||
Foreign | ||||||||||||
Income Tax Disclosure [Line Items] | ||||||||||||
Income before taxes | 23,500 | |||||||||||
New York State | ||||||||||||
Income Tax Disclosure [Line Items] | ||||||||||||
Net operating loss carryforwards | 16,800 | 16,800 | ||||||||||
New York City | ||||||||||||
Income Tax Disclosure [Line Items] | ||||||||||||
Net operating loss carryforwards | $ 4,800 | $ 4,800 |
Income Taxes - Components of Pr
Income Taxes - Components of Provision (Tradeweb Markets LLC and Subsidiaries) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Current: | ||||||||||||
Federal | $ 0 | $ 0 | $ (16,529) | $ 21,373 | ||||||||
State and Local | 1,235 | 5,739 | 5,261 | 11,537 | ||||||||
Foreign | 1,212 | 3,559 | 2,153 | 4,368 | ||||||||
Total current tax expense | 2,447 | 9,298 | (9,115) | 37,278 | ||||||||
Deferred: | ||||||||||||
Federal | 680 | 1,085 | 52,845 | (88) | ||||||||
State and local | 288 | 1,517 | 12,572 | 18,194 | ||||||||
Foreign | 0 | 0 | (228) | (3,082) | ||||||||
Total deferred tax expense | 968 | 2,602 | 65,189 | 15,024 | ||||||||
Total provision for income taxes | $ 16,176 | $ 11,124 | $ 12,945 | $ 15,829 | $ 30,889 | $ 10,316 | $ 6,314 | $ 4,783 | $ 3,415 | $ 11,900 | $ 56,074 | $ 52,302 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of the Statutory Rate (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of the statutory tax rate | ||||
Statutory U.S. federal income tax rate | 21.00% | 21.00% | 21.00% | 21.00% |
State and local income taxes, net of federal income tax benefit | 4.70% | 5.10% | 5.00% | 3.90% |
Foreign tax rate differential | 3.70% | 2.50% | 0.20% | (1.10%) |
LLC flow-through structure | (19.00%) | (20.20%) | 0.00% | 0.00% |
Non-controlling interest | 0.00% | 0.00% | (3.40%) | (7.20%) |
Tax Receivable Agreement adjustment | 0.00% | 0.00% | (0.90%) | (3.10%) |
Rate change | 0.00% | 0.00% | (0.20%) | 10.20% |
Equity Compensation | 0.00% | 0.00% | (1.80%) | 0.00% |
Other | 0.00% | 0.00% | 0.50% | (0.50%) |
Effective income tax rate | 10.40% | 8.40% | 20.40% | 23.20% |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Asset (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Investment in partnership | $ 509,835 | $ 226,241 |
Net operating losses | 21,647 | 1,753 |
Tax Receivable Agreement - Interest | 13,859 | 10,395 |
Employee compensation | 23,291 | 9,888 |
Tax credits | 9,276 | 8,342 |
Other | 7,150 | 4,088 |
Deferred tax assets, gross | 585,058 | 260,707 |
Valuation Allowance | (110) | 0 |
Total deferred tax assets, net | 584,948 | 260,707 |
Deferred tax liabilities | ||
Goodwill and Intangibles | (24,811) | (25,829) |
Total deferred tax liabilities | (24,811) | (25,829) |
Total deferred tax asset (liability) | $ 560,137 | $ 234,878 |
Income Taxes - Uncertain Tax Po
Income Taxes - Uncertain Tax Position (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Gross unrecognized tax benefits as of January 1 | $ 6,512 |
Increase in current year tax positions | 722 |
Increase in prior year tax positions | 1,188 |
Decrease in prior year tax positions | (2,908) |
Acquired tax positions | 0 |
Settlements | 0 |
Gross unrecognized tax benefits as of December 31 | $ 5,514 |
Tax Receivable Agreement (Detai
Tax Receivable Agreement (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | [1] | Sep. 30, 2018 | [1] | Dec. 31, 2020 | Dec. 31, 2019 | |||
Tax Receivable Agreement | ||||||||||||||||
Percentage of amount of U.S. federal, state and local income or franchise tax savings | 50.00% | |||||||||||||||
Tax receivable agreement liability | $ 404,332 | $ 240,817 | $ 404,332 | $ 240,817 | ||||||||||||
Tax receivable agreement liability adjustment | $ 11,425 | $ 0 | $ 0 | $ 0 | $ 33,134 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 11,425 | [1] | $ 33,134 | [1] | ||
[1] | See Note 9 – Tax Receivable Agreement. |
Stockholder's Equity - Initial
Stockholder's Equity - Initial Public Offering and Reorganization Transaction (Details) - USD ($) $ / shares in Units, $ in Billions | Apr. 08, 2019 | Dec. 31, 2020 |
Subsidiary, Sale of Stock [Line Items] | ||
Weighted average share price (in dollars per share) | $ 21.62 | |
Class A Common Stock | Initial Public Offering | ||
Subsidiary, Sale of Stock [Line Items] | ||
Issuance of common stock, net of offering costs and cancellations (in shares) | 46,000,000 | |
Weighted average share price (in dollars per share) | $ 27 | |
Class A Common Stock | Over-Allotment Option | ||
Subsidiary, Sale of Stock [Line Items] | ||
Issuance of common stock, net of offering costs and cancellations (in shares) | 6,000,000 | 2,593,181 |
TradeWeb Markets Llc | ||
Subsidiary, Sale of Stock [Line Items] | ||
Weighted average share price (in dollars per share) | $ 27 | |
Net proceeds | $ 1.2 |
Stockholder's Equity - Amendmen
Stockholder's Equity - Amendment and Restatement of Certificate of Incorporation (Details) | 12 Months Ended | |||
Dec. 31, 2020numberOfVotes$ / sharesshares | Dec. 31, 2019$ / sharesshares | Jun. 28, 2019$ / shares | Apr. 08, 2019 | |
Class of Stock [Line Items] | ||||
Preferred stock, authorized (in shares) | shares | 250,000,000 | 250,000,000 | ||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Class A Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, authorized (in shares) | shares | 1,000,000,000 | 1,000,000,000 | ||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Number of votes per common stock | numberOfVotes | 1 | |||
Conversion ratio | 1 | |||
Class B Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, authorized (in shares) | shares | 450,000,000 | 450,000,000 | ||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | $ 0.00001 | |
Number of votes per common stock | numberOfVotes | 10 | |||
Conversion ratio | 1 | |||
Class C Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, authorized (in shares) | shares | 350,000,000 | 350,000,000 | ||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Number of votes per common stock | numberOfVotes | 1 | |||
Conversion ratio | 1 | |||
Class D Common Stock | ||||
Class of Stock [Line Items] | ||||
Common stock, authorized (in shares) | shares | 300,000,000 | 300,000,000 | ||
Common stock, par value per share (in dollars per share) | $ / shares | $ 0.00001 | $ 0.00001 | ||
Number of votes per common stock | numberOfVotes | 10 | |||
Conversion ratio | 1 | |||
Voting power threshold percentage to require conversion of shares | 4.90% | |||
TradeWeb Markets Llc | ||||
Class of Stock [Line Items] | ||||
Threshold percentage of economic interest for conversion | 10.00% | |||
Minimum | Class D Common Stock | ||||
Class of Stock [Line Items] | ||||
Voting power threshold percentage to require conversion of shares | 4.90% |
Stockholder's Equity - Recapita
Stockholder's Equity - Recapitalization of Tradeweb Markets LLC (Details) - TradeWeb Markets Llc | Apr. 04, 2019shares | Dec. 31, 2020shares |
Class of Stock [Line Items] | ||
Common units exchanged (in shares) | 222,222,197 | |
Cancellation ratio | 1 | |
Class A Common Stock | ||
Class of Stock [Line Items] | ||
Common units exchanged (in shares) | 146,333 | |
Class C Common Stock | ||
Class of Stock [Line Items] | ||
Common units exchanged (in shares) | 447 | |
Class P (A) | ||
Class of Stock [Line Items] | ||
Common units exchanged (in shares) | 6,887 | |
Class P (C) | ||
Class of Stock [Line Items] | ||
Common units exchanged (in shares) | 2 | |
Class P-1(A) | ||
Class of Stock [Line Items] | ||
Common units exchanged (in shares) | 6,094 | |
Class P-1 (C) | ||
Class of Stock [Line Items] | ||
Common units exchanged (in shares) | 232 |
Stockholder's Equity - Issuance
Stockholder's Equity - Issuance and Cancellation of Common Stock (Details) - USD ($) $ / shares in Units, $ in Millions | Apr. 08, 2019 | Dec. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Class of Stock [Line Items] | |||||
Number of shares canceled (in shares) | 96,933,192 | ||||
Weighted average share price (in dollars per share) | $ 21.62 | $ 21.62 | |||
Refinitiv Direct Owner | |||||
Class of Stock [Line Items] | |||||
Shares contributed by Refinitiv Owner (in shares) | 96,933,192 | ||||
Continuing LLC Owners | |||||
Class of Stock [Line Items] | |||||
Percentage of combined voting power of common stock | 27.50% | ||||
Class B Common Stock | |||||
Class of Stock [Line Items] | |||||
Shares contributed by Refinitiv Owner (in shares) | 96,933,192 | ||||
Number of shares canceled (in shares) | 9,993,731 | ||||
Class B Common Stock | Refinitiv Direct Owner | |||||
Class of Stock [Line Items] | |||||
Number of shares owned (in shares) | 96,933,192 | ||||
Number of shares canceled (in shares) | 96,933,192 | ||||
Percentage of combined voting power of common stock | 56.40% | ||||
Class C Common Stock | |||||
Class of Stock [Line Items] | |||||
Shares issued to acquire TWM LLC (in shares) | 20,000,000 | ||||
Number of shares canceled (in shares) | 9,993,731 | ||||
Class C Common Stock | Continuing LLC Owners | |||||
Class of Stock [Line Items] | |||||
Number of shares owned (in shares) | 10,006,269 | ||||
Class D Common Stock | |||||
Class of Stock [Line Items] | |||||
Shares issued to acquire TWM LLC (in shares) | 105,289,005 | ||||
Number of shares canceled (in shares) | 36,006,269 | ||||
Class D Common Stock | Refinitiv LLC Owner | |||||
Class of Stock [Line Items] | |||||
Shares issued to acquire TWM LLC (in shares) | 22,988,329 | ||||
Percentage of combined voting power of common stock | 13.40% | ||||
Number of LLC Interest (in shares) | 22,988,329 | ||||
Class D Common Stock | Continuing LLC Owners | |||||
Class of Stock [Line Items] | |||||
Number of shares owned (in shares) | 46,294,407 | ||||
Class A Common Stock | |||||
Class of Stock [Line Items] | |||||
Number of shares owned (in shares) | 46,000,000 | ||||
Percentage of combined voting power of common stock | 2.70% | ||||
Class A Common Stock | October 2019 Follow-On Offering | |||||
Class of Stock [Line Items] | |||||
Issuance of common stock, net of offering costs and cancellations (in shares) | 19,881,059 | ||||
Weighted average share price (in dollars per share) | $ 42 | $ 42 | |||
Net proceeds | $ 810 | ||||
Stock repurchased and retired (in shares) | 45,393 | ||||
Class A Common Stock | Over-Allotment Option | |||||
Class of Stock [Line Items] | |||||
Issuance of common stock, net of offering costs and cancellations (in shares) | 6,000,000 | 2,593,181 | |||
Shares issued to underwriters (in shares) | 1,674,162 | ||||
Class A Common Stock | April 2020 Follow-On Offering | |||||
Class of Stock [Line Items] | |||||
Issuance of common stock, net of offering costs and cancellations (in shares) | 12,835,245 | ||||
Weighted average share price (in dollars per share) | $ 50.25 | ||||
Net proceeds | $ 626.3 | ||||
Stock repurchased and retired (in shares) | 596,418 | ||||
LLC units | October 2019 Follow-On Offering | |||||
Class of Stock [Line Items] | |||||
Stock repurchased and retired (in shares) | 19,835,666 | ||||
LLC units | April 2020 Follow-On Offering | |||||
Class of Stock [Line Items] | |||||
Stock repurchased and retired (in shares) | 12,238,827 | ||||
TradeWeb Markets Llc | |||||
Class of Stock [Line Items] | |||||
Number of LLC Interest (in shares) | 34,011,202 | 59,182,155 | |||
Ownership percentage, Continuing LLC Owners | 14.90% | 14.90% | 26.60% | ||
Number of LLC Interest held by parent (in shares) | 142,933,192 | 195,008,657 | 163,341,520 | ||
Ownership interest | 64.30% | 85.10% | 85.10% | 73.40% | |
Weighted average share price (in dollars per share) | $ 27 | ||||
Net proceeds | $ 1,200 | ||||
TradeWeb Markets Llc | Continuing LLC Owners | |||||
Class of Stock [Line Items] | |||||
Number of LLC Interest (in shares) | 56,300,676 | ||||
Ownership percentage, Continuing LLC Owners | 25.30% | ||||
TradeWeb Markets Llc | Class B Common Stock | Refinitiv Direct Owner | |||||
Class of Stock [Line Items] | |||||
Percentage of economic interest | 43.60% | ||||
TradeWeb Markets Llc | Class D Common Stock | Refinitiv LLC Owner | |||||
Class of Stock [Line Items] | |||||
Ownership percentage, Continuing LLC Owners | 10.30% | ||||
TradeWeb Markets Llc | Class A Common Stock | |||||
Class of Stock [Line Items] | |||||
Percentage of economic interest | 20.70% |
Stockholder's Equity - Redempti
Stockholder's Equity - Redemptions and Exchange of LLC Interests (Details) - shares | Dec. 31, 2020 | Dec. 31, 2019 | Apr. 08, 2019 |
Tradeweb Markets Inc | Public Investors | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Voting power percentage | 7.10% | ||
Tradeweb Markets Inc | Bank Stockholders | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Voting power percentage | 5.90% | ||
Tradeweb Markets Inc | Class A Common Stock | Public Investors | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of share owned (in shares) | 98,075,465 | ||
Tradeweb Markets Inc | Class C Common Stock | Bank Stockholders | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of share owned (in shares) | 3,139,821 | ||
Tradeweb Markets Inc | Class D Common Stock | Bank Stockholders | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of share owned (in shares) | 7,754,708 | ||
TradeWeb Markets Llc | |||
Subsidiary, Sale of Stock [Line Items] | |||
Ownership interest | 85.10% | 73.40% | 64.30% |
Number of LLC Interests held by non-controlling interests | 14.90% | 26.60% | |
TradeWeb Markets Llc | Public Investors | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of LLC Interests held by non-controlling interests | 42.80% | ||
TradeWeb Markets Llc | Bank Stockholders | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of LLC Interests held by non-controlling interests | 4.80% | ||
Refinitiv | Tradeweb Markets Inc | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Ownership interest | 86.90% | ||
Refinitiv | Tradeweb Markets Inc | Class D Common Stock | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of share owned (in shares) | 22,988,329 | ||
Refinitiv | TradeWeb Markets Llc | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Ownership interest | 52.40% | ||
Refinitiv | TradeWeb Markets Llc | Class B Common Stock | Redemptions and Exchanges of LLC Interests | |||
Subsidiary, Sale of Stock [Line Items] | |||
Number of share owned (in shares) | 96,933,192 |
Stockholder's Equity - Share Re
Stockholder's Equity - Share Repurchsae (Details) $ / shares in Units, $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($)$ / sharesshares | |
Equity [Abstract] | |
Common stock repurchased (in shares) | shares | 1,509,321 |
Average price per share (in dollars per share) | $ / shares | $ 50.47 |
Aggregate value of share repurchase | $ | $ 76.2 |
Non-Controlling Interests (Deta
Non-Controlling Interests (Details) $ in Thousands | Apr. 08, 2019shares | Dec. 31, 2020USD ($) | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($)shares |
Non-Controlling Interests | ||||||||||
Net income attributable to Tradeweb Markets Inc. | $ 55,060 | $ 36,812 | $ 30,496 | $ 43,928 | $ 41,329 | $ 29,612 | $ 12,828 | $ 166,296 | $ 83,769 | |
Allocation of equity to non-controlling interests arising from the reorganization transactions and IPO | 0 | (1,607,529) | ||||||||
Change in non-controlling interests as a result of ownership changes | 533,900 | 402,227 | ||||||||
Net transfers (to) from non-controlling interests | $ 533,900 | (1,205,302) | ||||||||
Change from net income attributable to Tradeweb Markets Inc. and transfers (to) from non-controlling interests | $ (1,121,533) | |||||||||
Class A Common Stock | ||||||||||
Non-Controlling Interests | ||||||||||
Conversion ratio | 1 | |||||||||
Class B Common Stock | ||||||||||
Non-Controlling Interests | ||||||||||
Conversion ratio | 1 | |||||||||
TradeWeb Markets Llc | ||||||||||
Non-Controlling Interests | ||||||||||
Number of LLC Interests held by Tradeweb Markets Inc. (in shares) | shares | 142,933,192 | 195,008,657 | 163,341,520 | |||||||
Number of LLC Interests held by non-controlling interests (in shares) | shares | 34,011,202 | 59,182,155 | ||||||||
Total LLC Interests outstanding (in shares) | shares | 229,019,859 | 222,523,675 | ||||||||
Number of LLC Interests held by Tradeweb Markets Inc. | 64.30% | 85.10% | 73.40% | 85.10% | 73.40% | |||||
Number of LLC Interests held by non-controlling interests | 14.90% | 26.60% | 14.90% | 26.60% | ||||||
Total LLC Interests outstanding | 100.00% | 100.00% | 100.00% | 100.00% |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans - Additional Information (Details) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2020USD ($)employee$ / sharesshares | Dec. 31, 2019USD ($)$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage of performance modifier | 100.00% | |||
Number of employees impacted | employee | 54 | |||
Amount reclassified to members capital | $ 19,100 | |||
Fair value of PRSUs vested | 39,800 | |||
Options compensation expense | $ 9,400 | $ 15,900 | 40,100 | $ 50,700 |
Intrinsic value of options exercised during the year | $ 291,800 | $ 21,300 | ||
Exercises (in dollars per share) | $ / shares | $ 1.81 | $ 8.83 | ||
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage of performance modifier | 0.00% | |||
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Percentage of performance modifier | 200.00% | |||
2019 Omnibus Equity Incentive Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of shares authorized (in shares) | shares | 8,841,864 | |||
Cliff vesting period | 10 years | |||
Equity-Settled PRSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Equity settled PRSU's issued on conversion (in shares) | shares | 2,000,384 | |||
Vests (in dollars per share) | $ / shares | $ 9.53 | $ 21.08 | ||
Options compensation expense | $ 27,809 | $ 25,392 | ||
Performance Shares Settled With Cash [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Cash settled PRSU's converted (in shares) | shares | 1,033.2 | |||
Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Cliff vesting period | 4 years | |||
Options compensation expense | $ 6,118 | $ 24,432 | ||
Options | Initial Public Offering | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options compensation expense | $ 18,900 |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans - PRSUs Settlement (Details) - Equity-Settled PRSUs - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
PRSUs | ||
Balance outstanding at beginning of period (in shares) | 3,490,666 | |
Grants (in shares) | 360,609 | |
Vests (in shares) | (861,277) | |
Performance adjustment (in shares) | 360,609 | |
Forfeitures (in shares) | 5,523 | |
Balance options outstanding at end of period (in shares) | 3,356,130 | 3,490,666 |
Weighted Average Grant-Date Fair Value | ||
Balance outstanding at beginning of period (in dollars per share) | $ 14.59 | |
Grants (in dollars per share) | 38.87 | |
Vests (in dollars per share) | 9.53 | $ 21.08 |
Performance adjustment (in dollars per share) | 38.87 | |
Forfeitures (in dollars per share) | 13.99 | |
Balance outstanding at end of period (in dollars per share) | $ 21.09 | $ 14.59 |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans - PSRUs Settle Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options compensation expense | $ 9,400 | $ 15,900 | $ 40,100 | $ 50,700 |
Equity-Settled PRSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options compensation expense | 27,809 | 25,392 | ||
Income tax benefit | $ (10,261) | $ (4,781) |
Stock-Based Compensation Plan_5
Stock-Based Compensation Plans - Outstanding Options (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Options | ||
Options outstanding at beginning of period (in shares) | 17,739,744 | |
Grants (in shares) | 0 | |
Exercises (in shares) | (8,504,872) | |
Forfeitures and adjustments (in shares) | 7,011 | |
Options outstanding at end of period (in shares) | 9,241,883 | 17,739,744 |
Vested options outstanding (in shares) | 4,112,473 | |
Weighted Average Grant Date Fair Value | ||
Options outstanding at beginning of period (in dollars per share) | $ 2.19 | |
Grants (in dollars per share) | 0 | |
Exercises (in dollars per share) | 1.81 | $ 8.83 |
Forfeitures and adjustments (in dollars per share) | 1.69 | |
Options outstanding at end of period (in dollars per share) | 2.54 | $ 2.19 |
Vested options outstanding (in dollars per share) | $ 1.95 |
Stock-Based Compensation Plan_6
Stock-Based Compensation Plans - Option Award Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options compensation expense | $ 9,400 | $ 15,900 | $ 40,100 | $ 50,700 |
Options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options compensation expense | 6,118 | 24,432 | ||
Income tax benefit | $ (57,457) | $ (8,556) |
Stock-Based Compensation Plan_7
Stock-Based Compensation Plans - Assumptions (Details) | 12 Months Ended |
Dec. 31, 2020$ / shares | |
Share-based Payment Arrangement [Abstract] | |
Weighted Average Expected Life (years) | 5 years 8 months 12 days |
Weighted Average Risk-Free Interest Rate | 2.90% |
Weighted Average Expected Volatility | 20.00% |
Weighted Average Expected Dividend Yield | 3.90% |
Weighted average exercise price (in dollars per share) | $ 21.62 |
Weighted average share price (in dollars per share) | $ 21.62 |
Stock-Based Compensation Plan_8
Stock-Based Compensation Plans - Summary of Outstanding RSUs (Details) - RSUs | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
RSUs | |
Balance options outstanding at end of period (in shares) | shares | 493,878 |
Grants (in shares) | shares | 493,878 |
Vests (in shares) | shares | 0 |
Forfeitures (in shares) | shares | 0 |
Balance outstanding at beginning of period (in shares) | shares | 0 |
Weighted Average Grant-Date Fair Value | |
Balance outstanding at beginning of period (in dollars per share) | $ / shares | $ 0 |
Grants (in dollars per share) | $ / shares | 38.91 |
Vests (in dollars per share) | $ / shares | 0 |
Forfeitures (in dollars per share) | $ / shares | 0 |
Balance outstanding at end of period (in dollars per share) | $ / shares | $ 38.91 |
Stock-Based Compensation Plan_9
Stock-Based Compensation Plans - Summary of RSU Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options compensation expense | $ 9,400 | $ 15,900 | $ 40,100 | $ 50,700 |
RSUs | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Options compensation expense | 5,359 | |||
Income tax benefit | $ (311) |
Stock-Based Compensation Pla_10
Stock-Based Compensation Plans - Unrecognized Compensation Expense (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Equity-Settled PRSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total unrecognized compensation cost | $ 31,355 |
Weighted-average recognition period | 1 year 7 months 20 days |
Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total unrecognized compensation cost | $ 3,140 |
Weighted-average recognition period | 1 year 11 months 19 days |
RSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total unrecognized compensation cost | $ 13,927 |
Weighted-average recognition period | 2 years 2 months 12 days |
Related Party Transactions - Ba
Related Party Transactions - Balances (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Related Party Transactions [Abstract] | ||
Accounts receivable | $ 4,009 | $ 0 |
Receivable from affiliates | 111 | 2,525 |
Other Assets | 2,722 | 2,731 |
Accounts payable, accrued expenses and other liabilities | 6,140 | 0 |
Deferred revenue | 4,500 | 4,733 |
Payable to affiliates | $ 5,142 | $ 1,506 |
Related Party Transactions - Co
Related Party Transactions - Consolidated Statements of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenue: | ||||||||||||
Revenue | $ 233,076 | $ 212,870 | $ 212,107 | $ 234,606 | $ 197,308 | $ 200,981 | $ 190,485 | $ 186,792 | $ 178,637 | $ 478,941 | $ 892,659 | $ 775,566 |
Shared Services Fees: | ||||||||||||
Technology and communications | 13,103 | 12,037 | 12,042 | 10,318 | 10,199 | 9,527 | 9,519 | 10,040 | 9,907 | 26,598 | 47,500 | 39,285 |
General and administrative | 10,302 | 8,657 | 7,523 | 8,340 | 8,999 | 7,507 | 9,365 | 9,089 | 11,837 | 23,056 | 34,822 | 34,960 |
Occupancy | $ 3,982 | $ 3,443 | $ 3,509 | $ 3,726 | $ 3,786 | $ 3,640 | $ 3,621 | $ 3,639 | 3,308 | 10,732 | 14,660 | 14,686 |
Affiliated Entity | ||||||||||||
Operating Income: | ||||||||||||
Net interest income (expense) | 17 | 34 | 0 | 858 | ||||||||
Shared Services Fees: | ||||||||||||
Technology and communications | 740 | 2,220 | 2,960 | 2,960 | ||||||||
General and administrative | 180 | 539 | (591) | 430 | ||||||||
Occupancy | 155 | 466 | 15 | 481 | ||||||||
Transaction fees | Affiliated Entity | ||||||||||||
Revenue: | ||||||||||||
Revenue | 59,259 | 159,663 | 0 | 59,643 | ||||||||
Subscription fees | Affiliated Entity | ||||||||||||
Revenue: | ||||||||||||
Revenue | 5,718 | 16,627 | 0 | 5,670 | ||||||||
Commissions | Affiliated Entity | ||||||||||||
Revenue: | ||||||||||||
Revenue | 12,401 | 34,944 | 0 | 16,186 | ||||||||
Refinitiv market data fees | Affiliated Entity | ||||||||||||
Revenue: | ||||||||||||
Revenue | $ 13,467 | $ 36,851 | $ 59,706 | $ 55,635 |
Related Party Transactions - Na
Related Party Transactions - Narrative (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
Apr. 30, 2019 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2014 | |
Related Party Transactions | ||||||||||||||
Consulting service fee for IPO | $ 1,000 | |||||||||||||
Consulting service fee for follow on offering | $ 500 | $ 500 | ||||||||||||
Adjustment to additional paid in capital due to consulting service fee | $ 2,000 | |||||||||||||
Contingent consideration recognized | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 0 | $ 26,830 | 0 | $ 0 | ||
Refinitiv | Operating Expense Reimbursement | ||||||||||||||
Related Party Transactions | ||||||||||||||
Related party expense | $ 3,800 | $ 2,400 | $ 6,700 | |||||||||||
TR | Operating Expense Reimbursement | ||||||||||||||
Related Party Transactions | ||||||||||||||
Related party expense | $ 28,700 | |||||||||||||
Banks | ||||||||||||||
Related Party Transactions | ||||||||||||||
Capital contribution | $ 120,000 | |||||||||||||
Employees | ||||||||||||||
Related Party Transactions | ||||||||||||||
Investment by employees | $ 5,300 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value of Financial Instruments | ||
Total assets measured at fair value | $ 541,790 | $ 219,158 |
Equity investments | 21,100 | 1,100 |
Quoted Prices in active Markets for Identical Assets (Level 1) | ||
Fair Value of Financial Instruments | ||
Money market funds | 541,790 | 219,158 |
Quoted Prices in active Markets for Identical Assets (Level 1) | Money market funds | ||
Fair Value of Financial Instruments | ||
Money market funds | 541,790 | 219,158 |
Significant Observable Inputs (Level 2) | ||
Fair Value of Financial Instruments | ||
Money market funds | 0 | 0 |
Significant Observable Inputs (Level 2) | Money market funds | ||
Fair Value of Financial Instruments | ||
Money market funds | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value of Financial Instruments | ||
Money market funds | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Money market funds | ||
Fair Value of Financial Instruments | ||
Money market funds | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Financial Instruments Not Measured at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value of Financial Instruments | ||
Receivable from brokers and dealers and clearing organizations | $ 368 | $ 30,641 |
Deposits with clearing organizations | 11,671 | 9,724 |
Accounts receivable | 105,286 | 92,814 |
Total assets | 5,679,850 | 5,095,334 |
Payable to brokers and dealers and clearing organizations | 252 | 30,452 |
Total liabilities | 660,687 | 502,589 |
Fair Value, Nonrecurring | ||
Fair Value of Financial Instruments | ||
Cash | 250,490 | 242,553 |
Receivable from brokers and dealers and clearing organizations | 368 | 30,641 |
Deposits with clearing organizations | 11,671 | 9,724 |
Accounts receivable | 105,286 | 92,814 |
Memberships in clearing organizations | 1,586 | 1,575 |
Total assets | 369,401 | 377,307 |
Payable to brokers and dealers and clearing organizations | 252 | 30,452 |
Total liabilities | 252 | 30,452 |
Quoted Prices in active Markets for Identical Assets (Level 1) | ||
Fair Value of Financial Instruments | ||
Cash | 541,790 | 219,158 |
Quoted Prices in active Markets for Identical Assets (Level 1) | Fair Value, Nonrecurring | ||
Fair Value of Financial Instruments | ||
Cash | 250,490 | 242,553 |
Receivable from brokers and dealers and clearing organizations | 0 | 0 |
Deposits with clearing organizations | 11,671 | 9,724 |
Accounts receivable | 0 | 0 |
Memberships in clearing organizations | 0 | 0 |
Total assets | 262,161 | 252,277 |
Payable to brokers and dealers and clearing organizations | 0 | 0 |
Total liabilities | 0 | 0 |
Significant Observable Inputs (Level 2) | ||
Fair Value of Financial Instruments | ||
Cash | 0 | 0 |
Significant Observable Inputs (Level 2) | Fair Value, Nonrecurring | ||
Fair Value of Financial Instruments | ||
Cash | 0 | 0 |
Receivable from brokers and dealers and clearing organizations | 368 | 30,641 |
Deposits with clearing organizations | 0 | 0 |
Accounts receivable | 105,286 | 92,814 |
Memberships in clearing organizations | 0 | 0 |
Total assets | 105,654 | 123,455 |
Payable to brokers and dealers and clearing organizations | 252 | 30,452 |
Total liabilities | 252 | 30,452 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value of Financial Instruments | ||
Cash | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Fair Value, Nonrecurring | ||
Fair Value of Financial Instruments | ||
Cash | 0 | 0 |
Receivable from brokers and dealers and clearing organizations | 0 | 0 |
Deposits with clearing organizations | 0 | 0 |
Accounts receivable | 0 | 0 |
Memberships in clearing organizations | 1,586 | 1,575 |
Total assets | 1,586 | 1,575 |
Payable to brokers and dealers and clearing organizations | 0 | 0 |
Total liabilities | 0 | 0 |
Total | Fair Value, Nonrecurring | ||
Fair Value of Financial Instruments | ||
Cash | 250,490 | 242,553 |
Receivable from brokers and dealers and clearing organizations | 368 | 30,641 |
Deposits with clearing organizations | 11,671 | 9,724 |
Accounts receivable | 105,286 | 92,814 |
Memberships in clearing organizations | 1,586 | 1,575 |
Total assets | 369,401 | 377,307 |
Payable to brokers and dealers and clearing organizations | 252 | 30,452 |
Total liabilities | $ 252 | $ 30,452 |
Credit Risk (Details)
Credit Risk (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Credit Risk | ||
Total stockholder's equity | $ 4,303,451 | $ 3,378,588 |
Excess net capital | 10,000 | |
Allowance for doubtful accounts | 243 | $ 195 |
Minimum | ||
Credit Risk | ||
Total stockholder's equity | $ 25,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Apr. 08, 2019USD ($) | Dec. 31, 2020USD ($)action |
Revolving credit facility | ||
Commitments and Contingencies | ||
Term of debt | 5 years | |
Maximum borrowing capacity | $ 500,000,000 | |
Commitment fee | 0.25% | |
Amount outstanding | $ 0 | |
Revolving credit facility | Federal funds | ||
Commitments and Contingencies | ||
Spread | 0.50% | |
Revolving credit facility | One-month LIBOR | ||
Commitments and Contingencies | ||
Spread | 1.00% | |
Revolving credit facility | Base rate | ||
Commitments and Contingencies | ||
Spread | 0.75% | |
Revolving credit facility | LIBOR | ||
Commitments and Contingencies | ||
Spread | 1.75% | |
Floor | 0.00% | |
Antitrust Actions Related To Trading Practices | ||
Commitments and Contingencies | ||
Number of actions | action | 2 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |||||
Numerator: | ||||||||||||||||
Pre-IPO net income attributable to Tradeweb Markets LLC | $ 166,296 | $ 83,769 | ||||||||||||||
Denominator: | ||||||||||||||||
Weighted average outstanding - Basic (in shares) | 189,795,356 | 187,774,170 | 177,649,501 | 166,234,749 | 157,950,550 | 142,935,206 | 142,933,192 | 222,222,197 | 222,221,628 | [1],[2] | 215,365,920 | [1],[2] | 180,409,462 | [1],[3] | 148,013,274 | [1],[3] |
Weighted average outstanding - Diluted (in shares) | 197,745,297 | 194,955,695 | 185,489,824 | 174,517,244 | 167,323,520 | 151,362,643 | 150,847,183 | 223,320,457 | 222,243,851 | [1],[2] | 215,365,920 | [1],[2] | 188,223,032 | [1],[3] | 156,540,246 | [1],[3] |
Earnings per share - Basic (in dollars per share) | $ 0.29 | $ 0.20 | $ 0.17 | $ 0.26 | $ 0.26 | $ 0.21 | $ 0.09 | $ 0.19 | $ 0.13 | [1],[2] | $ 0.60 | [1],[2] | $ 0.92 | [1],[3] | $ 0.57 | [1],[3] |
Earnings per share - Diluted (in dollars per share) | $ 0.28 | $ 0.19 | $ 0.16 | $ 0.25 | $ 0.25 | $ 0.20 | $ 0.09 | $ 0.19 | $ 0.13 | [1],[2] | $ 0.60 | [1],[2] | $ 0.88 | [1],[3] | $ 0.54 | [1],[3] |
Shares excluded from computation of diluted earnings per share (in shares) | 264,819 | 128,125 | ||||||||||||||
PRSU | ||||||||||||||||
Denominator: | ||||||||||||||||
Dilutive effect (in shares) | 2,472,801 | 2,464,137 | ||||||||||||||
Options | ||||||||||||||||
Denominator: | ||||||||||||||||
Dilutive effect (in shares) | 5,179,109 | 6,062,835 | ||||||||||||||
RSUs | ||||||||||||||||
Denominator: | ||||||||||||||||
Dilutive effect (in shares) | 161,660 | |||||||||||||||
Potential Dilutive | ||||||||||||||||
Denominator: | ||||||||||||||||
Shares excluded from computation of diluted earnings per share (in shares) | 45,828,289 | |||||||||||||||
TradeWeb Markets Llc | ||||||||||||||||
Numerator: | ||||||||||||||||
Pre-IPO net income attributable to Tradeweb Markets LLC | $ 42,352 | $ 29,307 | $ 130,160 | $ 0 | $ 42,352 | |||||||||||
Denominator: | ||||||||||||||||
Weighted average outstanding - Basic (in shares) | 222,222,197 | 222,221,628 | 215,365,920 | 222,222,197 | [1],[2] | |||||||||||
Weighted average outstanding - Diluted (in shares) | 222,243,851 | 215,365,920 | 223,320,457 | [1],[2] | ||||||||||||
Earnings per share - Basic (in dollars per share) | $ 0.19 | $ 0.13 | $ 0.60 | $ 0.19 | [1],[2] | |||||||||||
Earnings per share - Diluted (in dollars per share) | $ 0.19 | $ 0.13 | $ 0.60 | $ 0.19 | [1],[2] | |||||||||||
TradeWeb Markets Llc | PRSU | ||||||||||||||||
Denominator: | ||||||||||||||||
Dilutive effect (in shares) | 1,098,260 | 22,223 | 0 | |||||||||||||
[1] | In April 2019, the Company completed the Reorganization Transactions and the IPO, which, among other things, resulted in Tradeweb Markets Inc. becoming the successor of Tradeweb Markets LLC for financial reporting purposes. As a result, earnings per share information for the pre-IPO period is not comparable to the earnings per share information for the post-IPO period. Therefore, earnings per share information is being presented separately for the pre-IPO and post-IPO periods. See Note 17 – Earnings Per Share for additional information. | |||||||||||||||
[2] | Presents information for Tradeweb Markets LLC (pre-IPO period). | |||||||||||||||
[3] | Presents information for Tradeweb Markets Inc. (post-IPO period). |
Regulatory Capital Requiremen_3
Regulatory Capital Requirements (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
TWL | ||
Regulatory Capital Requirements | ||
Regulatory Capital | $ 49,254 | $ 42,317 |
Regulatory Capital Requirement | 2,438 | 2,396 |
Excess Regulatory Capital | 46,816 | 39,921 |
DW | ||
Regulatory Capital Requirements | ||
Regulatory Capital | 58,026 | 52,016 |
Regulatory Capital Requirement | 2,147 | 2,026 |
Excess Regulatory Capital | 55,879 | 49,990 |
TWD | ||
Regulatory Capital Requirements | ||
Regulatory Capital | 20,577 | 33,807 |
Regulatory Capital Requirement | 731 | 664 |
Excess Regulatory Capital | 19,846 | 33,143 |
TEL | ||
Regulatory Capital Requirements | ||
Regulatory Capital | 59,238 | 49,611 |
Regulatory Capital Requirement | 33,742 | 21,856 |
Excess Regulatory Capital | 25,496 | 27,755 |
TWJ | ||
Regulatory Capital Requirements | ||
Regulatory Capital | 11,066 | 11,851 |
Regulatory Capital Requirement | 3,799 | 8,565 |
Excess Regulatory Capital | 7,267 | 3,286 |
TWEU | ||
Regulatory Capital Requirements | ||
Regulatory Capital | 19,102 | 6,217 |
Regulatory Capital Requirement | 2,562 | 1,701 |
Excess Regulatory Capital | 16,540 | 4,516 |
TW SEF | ||
Regulatory Capital Requirements | ||
Financial Resources | 28,476 | 21,303 |
Required Financial Resources | 13,500 | 10,500 |
Excess Financial Resources | 14,976 | 10,803 |
Liquid Financial Assets | 15,662 | 18,168 |
Required Liquid Financial Assets | 6,750 | 5,250 |
Excess Liquid Financial Assets | 8,912 | 12,918 |
DW SEF | ||
Regulatory Capital Requirements | ||
Financial Resources | 15,298 | 13,707 |
Required Financial Resources | 6,223 | 5,505 |
Excess Financial Resources | 9,075 | 8,202 |
Liquid Financial Assets | 8,610 | 7,583 |
Required Liquid Financial Assets | 3,112 | 2,753 |
Excess Liquid Financial Assets | $ 5,498 | $ 4,830 |
Business Segment and Geograph_3
Business Segment and Geographic Information - Revenue by Client Sector (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Business Segment and Geographic Information | ||||||||||||
Gross revenue | $ 233,076 | $ 212,870 | $ 212,107 | $ 234,606 | $ 197,308 | $ 200,981 | $ 190,485 | $ 186,792 | $ 178,637 | $ 505,771 | $ 892,659 | $ 775,566 |
Contingent consideration | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (26,830) | 0 | 0 |
Net revenue | 233,076 | 212,870 | 212,107 | 234,606 | 197,308 | 200,981 | 190,485 | 186,792 | 178,637 | 478,941 | 892,659 | 775,566 |
Operating expenses | 161,496 | 154,349 | 156,468 | 156,991 | 142,979 | 142,723 | 159,530 | 140,515 | 146,702 | 338,607 | 629,304 | 585,747 |
Operating income | $ 71,580 | $ 58,521 | $ 55,639 | $ 77,615 | $ 54,329 | $ 58,258 | $ 30,955 | $ 46,277 | 31,935 | 140,334 | 263,355 | 189,819 |
Institutional | ||||||||||||
Business Segment and Geographic Information | ||||||||||||
Gross revenue | 103,971 | 301,918 | 554,330 | 453,379 | ||||||||
Wholesale | ||||||||||||
Business Segment and Geographic Information | ||||||||||||
Gross revenue | 38,153 | 99,028 | 185,456 | 171,096 | ||||||||
Retail | ||||||||||||
Business Segment and Geographic Information | ||||||||||||
Gross revenue | 19,780 | 57,766 | 76,352 | 80,368 | ||||||||
Market Data | ||||||||||||
Business Segment and Geographic Information | ||||||||||||
Gross revenue | $ 16,733 | $ 47,059 | $ 76,521 | $ 70,723 |
Business Segment and Geograph_4
Business Segment and Geographic Information - Revenue and Long-lived Assets by Geographic Region (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Business Segment and Geographic Information | ||||||||||||
Gross revenue | $ 233,076 | $ 212,870 | $ 212,107 | $ 234,606 | $ 197,308 | $ 200,981 | $ 190,485 | $ 186,792 | $ 178,637 | $ 505,771 | $ 892,659 | $ 775,566 |
Contingent consideration | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (26,830) | 0 | 0 |
Net revenue | 233,076 | $ 212,870 | $ 212,107 | $ 234,606 | 197,308 | $ 200,981 | $ 190,485 | $ 186,792 | 178,637 | 478,941 | 892,659 | 775,566 |
Long-lived assets | 4,108,113 | 4,214,233 | 4,108,113 | 4,214,233 | ||||||||
U.S. | ||||||||||||
Business Segment and Geographic Information | ||||||||||||
Gross revenue | 115,907 | 324,304 | 570,064 | 497,316 | ||||||||
Long-lived assets | 4,091,569 | 4,200,133 | 4,091,569 | 4,200,133 | ||||||||
International | ||||||||||||
Business Segment and Geographic Information | ||||||||||||
Gross revenue | $ 62,730 | $ 181,467 | 322,595 | 278,250 | ||||||||
Long-lived assets | $ 16,544 | $ 14,100 | $ 16,544 | $ 14,100 |
Quarterly Results of Operatio_3
Quarterly Results of Operations (Unaudited) - Operating Results (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2019 | Sep. 30, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |||||
Revenues | |||||||||||||||||
Gross revenue | $ 233,076 | $ 212,870 | $ 212,107 | $ 234,606 | $ 197,308 | $ 200,981 | $ 190,485 | $ 186,792 | $ 178,637 | $ 505,771 | $ 892,659 | $ 775,566 | |||||
Contingent consideration recognized | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 26,830 | 0 | 0 | |||||
Net revenue | 233,076 | 212,870 | 212,107 | 234,606 | 197,308 | 200,981 | 190,485 | 186,792 | 178,637 | 478,941 | 892,659 | 775,566 | |||||
Expenses | |||||||||||||||||
Employee compensation and benefits | 86,305 | 83,967 | 88,866 | 90,520 | 76,545 | 79,644 | 95,995 | 77,273 | 80,436 | 209,053 | 349,658 | 329,457 | |||||
Depreciation and amortization | 39,837 | 38,857 | 37,919 | 37,176 | 36,402 | 35,133 | 34,292 | 33,503 | 33,020 | 48,808 | 153,789 | 139,330 | |||||
Technology and communications | 13,103 | 12,037 | 12,042 | 10,318 | 10,199 | 9,527 | 9,519 | 10,040 | 9,907 | 26,598 | 47,500 | 39,285 | |||||
General and administrative | 10,302 | 8,657 | 7,523 | 8,340 | 8,999 | 7,507 | 9,365 | 9,089 | 11,837 | 23,056 | 34,822 | 34,960 | |||||
Professional fees | 7,967 | 7,388 | 6,609 | 6,911 | 7,048 | 7,272 | 6,738 | 6,971 | 8,194 | 20,360 | 28,875 | 28,029 | |||||
Occupancy | 3,982 | 3,443 | 3,509 | 3,726 | 3,786 | 3,640 | 3,621 | 3,639 | 3,308 | 10,732 | 14,660 | 14,686 | |||||
Total expenses | 161,496 | 154,349 | 156,468 | 156,991 | 142,979 | 142,723 | 159,530 | 140,515 | 146,702 | 338,607 | 629,304 | 585,747 | |||||
Operating income | 71,580 | 58,521 | 55,639 | 77,615 | 54,329 | 58,258 | 30,955 | 46,277 | 31,935 | 140,334 | 263,355 | 189,819 | |||||
Tax receivable agreement liability adjustment | 11,425 | 0 | 0 | 0 | 33,134 | 0 | 0 | 0 | 0 | [1] | 0 | [1] | 11,425 | [1] | 33,134 | [1] | |
Net interest income (expense) | (380) | (349) | (286) | 699 | 704 | 636 | 175 | 858 | 787 | 1,726 | (316) | 2,373 | |||||
Income before taxes | 82,625 | 58,172 | 55,353 | 78,314 | 88,167 | 58,894 | 31,130 | 47,135 | 32,722 | 142,060 | 274,464 | 225,326 | |||||
Provision for income taxes | (16,176) | (11,124) | (12,945) | (15,829) | (30,889) | (10,316) | (6,314) | (4,783) | (3,415) | (11,900) | (56,074) | (52,302) | |||||
Net income | 66,449 | 47,048 | 42,408 | 62,485 | 57,278 | 48,578 | 24,816 | $ 42,352 | $ 29,307 | $ 130,672 | $ 130,160 | 218,390 | 173,024 | ||||
Net income attributable to non-controlling interests | 11,389 | 10,236 | 11,912 | 18,557 | 15,949 | 18,966 | 11,988 | 52,094 | 46,903 | ||||||||
Net income attributable to Tradeweb Markets Inc. | $ 55,060 | $ 36,812 | $ 30,496 | $ 43,928 | $ 41,329 | $ 29,612 | $ 12,828 | $ 166,296 | $ 83,769 | ||||||||
Earnings per share | |||||||||||||||||
Basic (in dollars per share) | $ 0.29 | $ 0.20 | $ 0.17 | $ 0.26 | $ 0.26 | $ 0.21 | $ 0.09 | $ 0.19 | $ 0.13 | [2],[3] | $ 0.60 | [2],[3] | $ 0.92 | [2],[4] | $ 0.57 | [2],[4] | |
Diluted (in dollars per share) | $ 0.28 | $ 0.19 | $ 0.16 | $ 0.25 | $ 0.25 | $ 0.20 | $ 0.09 | $ 0.19 | $ 0.13 | [2],[3] | $ 0.60 | [2],[3] | $ 0.88 | [2],[4] | $ 0.54 | [2],[4] | |
Weighted average shares outstanding | |||||||||||||||||
Basic (in shares) | 189,795,356 | 187,774,170 | 177,649,501 | 166,234,749 | 157,950,550 | 142,935,206 | 142,933,192 | 222,222,197 | 222,221,628 | [2],[3] | 215,365,920 | [2],[3] | 180,409,462 | [2],[4] | 148,013,274 | [2],[4] | |
Diluted (in shares) | 197,745,297 | 194,955,695 | 185,489,824 | 174,517,244 | 167,323,520 | 151,362,643 | 150,847,183 | 223,320,457 | 222,243,851 | [2],[3] | 215,365,920 | [2],[3] | 188,223,032 | [2],[4] | 156,540,246 | [2],[4] | |
Transaction fees | |||||||||||||||||
Revenues | |||||||||||||||||
Gross revenue | $ 134,922 | $ 120,582 | $ 122,146 | $ 140,824 | $ 104,245 | $ 112,746 | $ 103,952 | $ 102,640 | $ 97,130 | $ 273,751 | $ 518,474 | $ 423,583 | |||||
Subscription fees | |||||||||||||||||
Revenues | |||||||||||||||||
Gross revenue | 36,652 | 36,217 | 35,006 | 34,483 | 34,333 | 35,387 | 34,566 | 34,445 | 33,052 | 107,130 | 142,358 | 138,731 | |||||
Commissions | |||||||||||||||||
Revenues | |||||||||||||||||
Gross revenue | 42,913 | 39,593 | 38,115 | 42,493 | 41,165 | 37,590 | 36,413 | 34,197 | 32,840 | 79,830 | 163,114 | 149,365 | |||||
Refinitiv market data fees | |||||||||||||||||
Revenues | |||||||||||||||||
Gross revenue | 16,240 | 14,273 | 14,565 | 14,628 | 15,383 | 13,251 | 13,385 | 13,616 | 13,467 | 36,851 | 59,706 | 55,635 | |||||
Other | |||||||||||||||||
Revenues | |||||||||||||||||
Gross revenue | $ 2,349 | $ 2,205 | $ 2,275 | $ 2,178 | $ 2,182 | $ 2,007 | $ 2,169 | $ 1,894 | $ 2,148 | $ 8,209 | $ 9,007 | $ 8,252 | |||||
[1] | See Note 9 – Tax Receivable Agreement. | ||||||||||||||||
[2] | In April 2019, the Company completed the Reorganization Transactions and the IPO, which, among other things, resulted in Tradeweb Markets Inc. becoming the successor of Tradeweb Markets LLC for financial reporting purposes. As a result, earnings per share information for the pre-IPO period is not comparable to the earnings per share information for the post-IPO period. Therefore, earnings per share information is being presented separately for the pre-IPO and post-IPO periods. See Note 17 – Earnings Per Share for additional information. | ||||||||||||||||
[3] | Presents information for Tradeweb Markets LLC (pre-IPO period). | ||||||||||||||||
[4] | Presents information for Tradeweb Markets Inc. (post-IPO period). |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 03, 2021 | Feb. 02, 2021 | Mar. 31, 2019 | Dec. 31, 2019 | Feb. 04, 2021 |
Subsequent Event [Line Items] | |||||
Capital distributions | $ 20,000 | $ 100,000 | |||
Dividends declared (in dollars per share) | $ 0.24 | ||||
Subsequent Event | |||||
Subsequent Event [Line Items] | |||||
Capital distributions | $ 18,800 | ||||
Subsequent Event | Class B Common Stock | |||||
Subsequent Event [Line Items] | |||||
Dividends declared (in dollars per share) | $ 0.08 | ||||
Subsequent Event | Class A Common Stock | |||||
Subsequent Event [Line Items] | |||||
Dividends declared (in dollars per share) | $ 0.08 | ||||
Share repurchase program, amount authorized | $ 150,000 |