All right, everybody. Next up, we have all three co-CEOs of BGC Group. We're joined by John Abouliraj right here next to me. We have J.P. Aubin over there on the end and Sean Windiat here in the middle. So BGC is one of the largest energy and wholesale financial brokers in the world or energy and financial wholesale brokers operating across rates, FX, credit, equities, and energy and commodities. Over the last 18 months, BGC has delivered mid-teens organic top-line growth, completed the OTC Global Holdings acquisition, which significantly expanded your energy franchise, and launched FMX into both SOFR and U.S. Treasury futures. So a lot going on, gentlemen. Great to have you back. Thanks very much for having us. All right. So you just put up a record first quarter. There's a lot of rate volatility, commodity dislocations, energy market turmoil, broadly a great setup for your business. Could you talk about how the year is shaped up? Where's the revenue strength most concentrated today? And how are you thinking about, you know, going forward from here, the outlook for the rest of the year?

Yeah, well, I said, you're right. Q1 couldn't have been a better setup for us in terms of the business. You know, we were up 44% in Q1 compared to the previous year in revenue and generating $955 million of revenue. And then, of course, people say, well, it must be because of the, you know, it must be because of the conflict. Well, actually, pre the conflict, we were actually up 41%. And sure, you know, the conflict obviously increased volumes, particularly in, as you mentioned, our biggest asset class in the ECS space, you know, ending up that 44% for the period. But it was the majority of that growth was what I would call standard market growth. It wasn't just market share gains. It's the targeted acquisitions that we've done, the electronic trading platforms that we've built. And that's what really drove our Q1. And then again, for the balance of the first half of the year, April was a quieter period for exchanges, right? You know, as everybody sort of checked back a little bit, but as you saw within our guidance for Q2, you know, still, that would have us up for the first half of the year, you know, 22% for the first half of the year as compared to last year and 13% of that being organic. So we've seen you saw a little bit of a tail off there in April as market participants were digesting what had happened throughout that really volatile month in March. And life has returned to, I don't know what normal is these days, but some level of normality for the month of May.

Sure. So looking back, OTC Global Holdings acquisition seems exceptionally well-timed given the energy market strength that we've seen here recently. You're now much more of an energy play than you were before this acquisition. I think before it was 15% of your revenues today, it's between 30% and 40% is coming from the energy and commodities business. So what impact do you think, you know, you talked a little bit about it, but the geopolitical setup, the things that you're doing in energy specifically, maybe cross-sell opportunities with the legacy franchise, where have you seen success there?

The biggest successes when it comes to the integration on the revenue side of OTC come from the OB business. So the gem in the OTC business is OB, which is, you know, stands for oil brokers, which I'm sure took them a while to come up with. But it's it's they were number one franchise in London. So we had a great franchise in Asia. They're number one in London. And we had a great franchise in the US. Those are mainly follow the sun traded businesses. So to be able to have all three has kind of completed the circle for us and where we were number three or four in the market. You know, we've now taken that to number one or two. And as you say, look, volatility, people are going to go to number one or two, who's got the biggest and the best liquidity. And that's what you've seen happen with the OB acquisition.

Sure. And one of the things I think that's also differentiated about you, a lot of people I don't think understand, it doesn't come up a lot in my conversations, but you have a shipping business that gives you very good insights into what's going on in the world. There's obviously been a lot of dislocation with global shipping lanes here recently. Could you talk about that business, how much of a revenue driver it is for you, and what sort of opportunities you're able to take advantage of with that business?

It's exactly as you said. So the integration of the OTC shipping business and the existing, the brand, it's branded Poten, which is the number one LNG shipping business in the world, gives you the insights to the actual brokers who are looking at a barrel of oil and knowing where we're traveling around and being able to sit there on our data sales business and know what's coming in from those platforms, both on voice, hybrid, and electronic, and give that information to our desks. They're doing a much better job voice broking the barrel of oil on the back of knowing where those ships are going. Got it. I think we've also been fairly clear that we want to expand that business further.

So, you know, how do you think you'd go about doing that? If you don't mind kind of elaborating?

Sure. I mean, well, we will, if, if, if investors return on capital is appropriate, we would make an acquisition in that business. Sure.

All right. Fenex, I want to shift to electronic revenues continue to grow. The transition of voice brokerage activity to electronic has been, you know, it's kind of an underlying narrative in the stock for several years. But some of your most recent acquisitions, OTC Global Holdings being one of them, that's a primarily voice brokerage business. So how do you think about the balance between voice and electronic? And what's the strategy going forward to continue driving volumes electronic? What are the things you're doing internally to facilitate that?

Well, I think, look, remember, and for those of you who don't know our company as well, think about the fact that we've got three elements of the business you've got really the voice the traditional voice broking business you've got the hybrid business where where you know a trade starts off voice and then ends up you know then the uh the size increases through uh through either voice or electronic can go either way and then you've got the fully electronic piece um you know over 25 percent of our business is is fully electronic now uh some people would were were looking over the last year and they'd You know, that's slowed down a little bit. You know, it was 25 percent a year ago or 24 percent a year ago. That's slow. Well, by the way, you know, over the last few years, the company's revenues have grown from two point two point two billion, just a few two point two six two to be exact right a few years ago, up to over up to over three billion for the for the trade in 12 months. And as you quite rightly said, in our rates, a traditional biggest asset class of rates in foreign exchange and credit, north of 90% of those businesses have the capability to be traded electronically, which obviously gives a higher margin to the business. But we're an exchange, right? We are an intermediary. And therefore, it's how our clients choose to transact business. And they either choose to transact voice, electronic, or a mixture of the two. Now, in terms of the tremendous opportunity is we now have a huge ECS business, which, as you quite rightly say, is pretty much today all voice. So that really gives us fuel to take that piece of the business electronic. But let's not rush, right? We'll do it. We'll do it as our clients want it. I don't expect you to go there tomorrow, but it's a great opportunity to do exactly what we've done in the other asset classes.

Sure. So if you were to build kind of that Fenex equivalent within energy, like what makes the most natural sense in terms of the offering and the products offered, the assets within ECS that you think could go electronic fastest? What does that market look like?

In terms of the way that some of these are traded now is they're blocking to an exchange, right? So I think turning, when you say turning them electronic, if you're talking about listing a future on FMX, yes, you know, certainly, I mean, I have one of my partners sitting in the stands over there, so I don't want to say too much or he'll hold me to it. But, you know, certainly that's got to be a discussion as to whether the partners in FMX want, you know, to do that. But taking advantage of the energy franchise at some point in the future makes sense in those listed products where you're blocking. In the products where they're traded completely voice, and that is primarily going to be in the non-standard part of the barrel, right? And in terms like, you know, we're number one in biodiesel. As you know, you know, we went and said last year, bought a fats and greases business to pair with our biodiesel desk. And I mean, you know, so things like that, where there's no electronic element to it, bringing that transparency and price discovery in an electronic fashion is certainly part of the plan going forward.

Sure. So maybe double clicking there on FMX, you know, futures launched a little over a year and a half ago. Stepping back, how satisfied have you been with the launch so far and the trajectory of volumes there? And how would you frame for the audience kind of where we are in the J curve of adoption and revenue growth, volume growth, open interest growth within that business?

Well, what's happening recently is great, right? So, you know, I think we said on the earnings call that, you know, at the time when the war started, it was worrisome when you watch your volumes drop. So we'd be we'd be lying if we said that, you know, watching that happen. And, you know, of course, in hindsight, everyone turns and says, well, that's what you would expect for a nascent exchange, which is, you know, SOFR and Treasury Futures would move to where the most volume is. But now being back where we were prior to that gives us greater confidence than we've ever had that the market is demanding a second venue. And we believe that, you know, as we said to you before, we've got the right partners, we've got the right clearer, right? We've got the right technology, we have the right guys leading that business. And, you know, we are more certain today that, you know, the marketplace is apt for, you know, our entry to continue to gain, you know, more market share. And, you know, you're seeing OI and ADV back improving on the trajectory it was before, you know, Iran, which obviously gives us, you know, the ability to look back on that and say, hey, we're glad that happened. But, you know, at the time, it didn't feel like that.

But I think as well, John, what's really what's exciting and with some of our earlier meetings today is you think it's really mirroring what happened in cash treasuries. But in cash in Fenix UST, that that started obviously started with a, you know, with lower market share in times of in times of particular volatility. you saw a dip and then you saw a recovery and here we are you know with our cash you know fenix ust with a market share of uh in excess of 40 percent so uh so we're we're very encouraged and actually as john jp and myself we're talking about just only only half an hour or so ago when you see something like that happen in the month of you know in the uh in the month of march when you see or end of end of february beginning of march when you see that and actually you see the trajectory, not then go, it actually went back to the levels it was and has continued to grow again, as John said, gives us tremendous confidence that with the partners that we have and the demand that we've got from the client base for the competition, it gives us even more confidence today.

One of the more cited, I think, selling points when FMX was launching was the ability to cross margin. So for futures with swaps collateral at LCH, any chance you could help just break down or quantify how much of that benefit FMX users are actually realizing today? What are those conversations like? Any color on that?

Sure. I mean, we've spoken about the number of FCMs that have onboarded. So, you know, what percentage of the market that is. And like everything else that we talk about when it comes to FMX and how laborious it is to get to those next stages, this is part of that process. And so what's happening in terms of the benefit is you have six of those FCMs ready to offer a cross-margining benefit. At last count, I think three more would be ready by the end of the year. And then you would have something like the 12 that you and I have spoken about before ready by the end of kind of Q1 of next year, which would give you 90 plus percent of liquidity available that could receive that cross-margining benefit going forward. But as you rightly point out, in terms of talking to new participants or non-partner participants, that's a big part of the story. So offering it from the six that are ready to do it now is certainly a huge, huge selling point for FMX. Sure.

Switching gears, you've done three acquisitions over the last year or so. I mentioned one of them. At this conference last year, You told us that with OTC integrated, you expected to lean more toward buybacks unless other opportunities surfaced. So a year on, can you talk about how that's played out? Where does the pipeline of potential M&A sit today? What's attractive? And is there an appetite for maybe doing something more transformational?

Look, in terms of in terms of our capital return, nothing has changed. You know, you saw from our overall share count was as fractionally low year over year. In terms of our buybacks, we tend to do those more in the second half of the year. You have slightly more uses for cash in Q1. But every decision that we make is EPS is all about what's the best value to our shareholder. And as you can imagine, when you do an acquisition, you mentioned three, when you do transformational ones like OTC, there's a lot of incoming calls, of course, to BGC. And if something is going to be of good value for our shareholders, then, of course, we will maintain acquisition mode. And if there isn't something that's readily available, then we'll continue to buy back stock. But both of those things will be highly beneficial for the shareholder.

Do you feel like there's any, from an asset class perspective, do you feel like there's any gaps that are glaring that you would be looking to address potentially through M&A? And how do you balance, as you look across the different franchises, investing for growth organically versus M&A?

Oh, sorry, go for it. Sorry, Jake. We noticed on ECS, where we are leaders there, right? The shipping market remains so fragmented, so fragmented. So obviously, we have incoming calls due to our current critical size on that product, on that asset today. And we're looking at every options. But definitely, shipping is the segment where we want to invest.

So for people in the audience who might not be as familiar with that business, can you talk about the economics of it and how you make money in that business specifically? I think that would be helpful to kind of just help people get a better grasp of that. You mean the way the shipping business works and how you make money off of that, where you sit, just an overview of kind of what the business looks like in terms of operations and also the revenue model.

So, again, thanks to our market share and critical size, we match roughly all the shipping routes in the world, but we can grow more, definitely. So we have OTC, Shipping Business, plus Poten, which is the leading in this segment, but we can grow larger. Now with the war, the conflict, we have different routes in the shipping business. And, again, that's where we have to invest more. We're leaders in oil, right? That's shipping the next move. Got it.

All right. So earlier we had Yuval Ruz up here from Digital Asset. They're working with the DTCC on tokenizing treasuries on Canton, which is the network that they use. But one of the things he said was that banks and financial institutions, through tokenization collateral mobility, increased collateral efficiency, could see 50% plus improvement improvement in balance sheet efficiency. And there's a thought out there that this is going to lead to volumes, especially among large financial institutions, just given the fact that they have these efficiency improvements, we're going to see a huge boost in volumes. How do you think about that as an inter-dealer broker where you sit? Are you paying attention to that? Do you view it as a tailwind of the business? And is there anything maybe related to tokenization that you guys would be looking at or you think would benefit the business?

I mean, I suppose it depends for us in which part of the business you're talking about. But certainly when we look at tokenization, the same conversations are happening from BGC that you just referenced before, whether it's a DTCC or not. But remember, we also have the aspect of FMX and looking at it from that perspective. And so, you know, our view on it is not dissimilar to what you said, which is it might have the benefit of greater volumes. I think, you know, what we try to do is prepare the business in the event that that won't happen. And if it becomes a tailwind for us, great.

OK, let's talk about non-bank liquidity. We have Joe McCain from Citadel coming up here later this afternoon. Citadel has been pushing harder into credit, harder rate liquidity. How do some of these alternative liquidity providers coming into the rates and fixed income space affect the competitive picture for BGC? Do you view them as a partner, competitor, both?

For Citadel, we view them as an essential partner to what we do across asset classes and across FMX. So they've been a great partner, continue to be a great partner. You know, as they disrupt and we try to disrupt, I'm sure there are many more things that we can talk about and hopefully do together. But we try to view innovation and disruptors as partners in these businesses and see where, you know, we can provide a certain element that, you know, perhaps aids what they're trying to do and vice versa. But no, we very much see them as a partner.

All right. Maybe just finishing off, if we look ahead three years from now, where do you see BGC as a company? What are the milestones investors should be paying attention to? And really, what are the things that you're most excited about in your business specifically as we look out over the next three to five years?

Well, let's start to go back to the sort of three parts of our business. So you've got the traditional, the traditional IDB voice hybrid business. You know, right about three years ago, after zero interest rates, you know, we said that the company is a growth company again. You know, we've grown 13%, 12%, 30%, and then another 22% for the half of this year. So, and that's been in, that's, and I think that is as a result of, that is because we have interest rates again, because remember, we are, think about us as an exchange for everything that doesn't trade in the exchange, right? So, you know, from 2008 to 2022 with zero interest rates, you know, people were trading less. But the business, the business that exists today, where we're at in 2026, excluding our acquisition, really is almost where we were, you know, back in 2008. So that for all the things that we now own. So for us, I think you'll see continued growth, significant growth within the ECS space. You know, you'll see market share gains in terms of rates. When it comes to credit. You'll see movements in credit. I mean, John has spoken significantly on various calls about the movement away from what I would say traditional IDB credit into the portfolio match, into the electronic trading, and that side of it within terms of the credit space. You've already heard the bifurcated market that exists in the ECS space. There's three or four main players in the in in the other asset classes there are still plenty of players in ecs what we've started in terms of in terms of consolidation will continue and by the way we haven't even spoken there in fmx right so yeah i mean for me it's just the ecosystem that we're creating i i hate that word so i apologize for it but you know if we think about the pieces that we're bringing together and what the electronification of our world particularly with ai coming in could look You know, you're talking about API connectivity coming in.

So the data that we're capturing on electronic, fully electronic trading coming in on this side, you sit there, you're the exchange, the exchange spills off that data. again, you are now doing a lot more with that data than what we've traditionally done, which is just basically sell the exhaust of our exchange to a client base. Now you're actually doing drive data products and being able to pair that. And then you're selling that data back to the client base over here. It's almost, if you've got a piece of paper in your hand, just folding back of it. And then you're sitting there saying, no, you own front to back of that market. And And, you know, as you as you gain greater access to new client bases, you know, what we've seen thus far in terms of deployment of, you know, we internally use Claude, but, you know, it could be, you know, a different animal in six months. Who knows? But, you know, what we're able to do in terms of consumption of large amounts of data, you know, and what we've got in terms of 15 years of verifiable bids, offers and trades sitting there that we're now able to consume and use. It's incredibly exciting. And I think we've got the pieces to do something different with with BGC. And hopefully, you know, you said I think you said two to three years, hopefully in two to three years, we won't be sitting here talking about, you know, an inter-dealer broker or something significantly more.

Sure. I think that's an interesting point, too, because there's a lot of exchanges who, you know, the data business has been almost a drag recently, but in your business, in the OTC markets, it's still a relatively untapped opportunity. What is it, less than 5% of revenues today comes from data, probably? That's right, yeah. The rule of thumb on, you know, other exchanges, 15 to 20, so a lot of runway there. Gentlemen, I think we're out of time, but thanks so much for joining us. My pleasure. Thanks for having us.