Kevin McPherson
MARKETAXESS HOLDINGSAbout Kevin McPherson
Kevin M. McPherson, age 54, is Chief Revenue Officer (CRO) of MarketAxess (MKTX) since July 2023. He joined MarketAxess in 1999 and progressed through sales leadership roles, including U.S. Sales Manager (2008–2014) and Global Head of Sales (2014–2023). He holds a B.A. in business administration from the University of Maine . Company performance in 2024 featured record total revenues of $817.1 million (+9% YoY), net income of $274.2 million, operating income of $340.9 million, and record ADV across products, underlining commercial execution in areas Mr. McPherson leads . His 2024 individual performance highlights include record total credit ADV ($14.2B, +13%), record revenue in emerging markets, eurobonds, municipals, and rates, and leading ~22,000 client meetings .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| MarketAxess | Chief Revenue Officer | Jul 2023–present | Drives global revenue growth, client engagement, and product commercialization . |
| MarketAxess | Global Head of Sales | Jun 2014–Jul 2023 | Led global sales and distribution strategy across products and regions . |
| MarketAxess | U.S. Sales Manager | Jan 2008–Jun 2014 | Managed U.S. sales execution and client coverage . |
| MarketAxess | Sales Representative | Mar 1999–Dec 2007 | Ran West Coast sales and distribution effort . |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Scudder Stevens & Clark | Emerging Markets Fixed Income Group | Jun 1996–Mar 1999 | Traded EM fixed income; supported portfolio administration . |
| State Street Bank & Trust | Accountant and Auditor (FI & Equities portfolios) | Jun 1994–Jun 1996 | Portfolio accounting/audit expertise in institutional asset servicing . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $300,000 | $450,000 | $450,000 |
Performance Compensation
Annual Cash Incentive (2024)
| Metric | Target | Adjusted Operating Income Funding | Individual Funding | Total Funding | Payout |
|---|---|---|---|---|---|
| Cash Incentive | $950,000 | 96% | 83% | 89% | $850,000 |
2024 adjusted operating income was $392.2 million vs. $408.1 million target (96% funding) .
Long-Term Equity Incentives (Grants linked to performance years)
| Component | 2023 Grant (Feb 15, 2024) | 2024 Grant (Feb 15, 2025) |
|---|---|---|
| PSUs – Units (Target) | 3,653 units | 3,740 units |
| PSUs – Grant Date Fair Value ($) | $805,487 | $723,653 |
| RSUs – Units | 3,653 units | 3,740 units |
| RSUs – Grant Date Fair Value ($) | $805,487 | $723,653 |
| Options – Units / Strike | None disclosed for Mr. McPherson | None disclosed for Mr. McPherson |
| PSU Metrics & Vesting | U.S. credit market share (⅓), revenue growth ex-U.S. credit (⅓), operating margin (⅓); 3-year cliff vest | Same metrics/structure; targets linked to prior-year results; 3-year cliff vest |
| RSU Vesting | Ratable over 3 years | Ratable over 3 years |
PSU Funding Outcome (2012 Performance Awards vesting 2025)
| Metric | Weight | 2022 | 2023 | 2024 | Total Funding |
|---|---|---|---|---|---|
| U.S. Credit Market Share | 33% | 94% | 32% | 0% | 42% |
| Revenue Growth ex-U.S. Credit | 33% | 17% | 0% | 25% | 14% |
| Operating Margin | 33% | 71% | 41% | 123% | 79% |
| Aggregate PSU Payout | 100% | 61% | 24% | 50% | 45% of target |
Equity Ownership & Alignment
| Ownership Metric | Value |
|---|---|
| Beneficial Ownership (Shares) | 64,555 shares; <1% of outstanding . |
| Stock Ownership Guidelines | NEOs must hold ≥3× salary; Kevin’s required shares: 5,899; all NEOs in compliance . |
| Hedging/Pledging | Prohibited under Insider Trading Policy (no hedging, no pledging/margin accounts) . |
| Upcoming Vesting Dynamics | RSUs granted Feb 15, 2024 vest in three equal annual tranches; one-third vested Feb 15, 2025; PSUs cliff-vest after 3 years subject to performance . |
Outstanding Equity Awards (as of Dec 31, 2024)
| Award Type | Units Unvested | Vesting Schedule |
|---|---|---|
| RSUs (Jan 31, 2022 grant) | 631 units | Three equal annual installments; vested Jan 31, 2023/2024/2025 . |
| RSUs (Feb 15, 2023 grant) | 1,438 units | Three equal annual installments; vested Feb 15, 2024/2025; final vest Feb 15, 2026 . |
| RSUs (Feb 15, 2024 grant) | 3,653 units | Three equal annual installments; one-third vested Feb 15, 2025 . |
| PSUs (Jan 31, 2022 grant – at target) | 1,911 units | Vested Jan 31, 2025 at 45% performance . |
| PSUs (Feb 15, 2023 grant – at target) | 2,178 units | Cliff vest on 3rd anniversary, subject to performance . |
| PSUs (Feb 15, 2024 grant – at target) | 3,653 units | Cliff vest on 3rd anniversary, subject to performance . |
Company policy prohibits hedging/pledging; directors and executives must observe blackout periods and holding requirements .
Employment Terms
| Provision | Key Terms |
|---|---|
| Severance Protection Agreement | CIC Termination: 1.5× (base + Average Annual Bonus), lump sum; Non-CIC Termination: 1.0× (base + Average Annual Bonus), paid over 12 months; Death/Disability: 0.5× (base + Average Annual Bonus), lump sum . |
| Pro Rata Bonus | CIC and Non-CIC: Average Annual Bonus; Death/Disability: 0.5× Average Annual Bonus . |
| Health Benefits | CIC: 18 months; Non-CIC or Death/Disability: 12 months . |
| Equity Treatment | CIC Termination or CIC Non-Continued Award: full vesting of unvested RSUs/PSUs; Non-CIC Termination: continued vesting for one year (per award terms) . |
| Non-Compete | 1 year post-employment for Mr. McPherson; non-solicitation of employees for 2 years; client/vendor non-solicitation for 1 year . |
| Clawbacks | Nasdaq-compliant restatement clawback and broader misconduct clawback (fraud, sexual harassment/assault, material policy violations, restrictive covenant breaches) covering cash and equity . |
| Tax Gross-Ups | No 280G excise tax gross-up; automatic cutback to avoid excise tax unless cutback reduces net after-tax compensation . |
Compensation Structure Analysis
- Pay mix: Significant variable compensation with annual cash tied to adjusted operating income and individual strategic contributions; long-term equity split between PSUs and RSUs; options are not disclosed for Mr. McPherson’s 2024/2025 grants, consistent with “Flex Share” approach favoring RSUs for some NEOs .
- Performance metrics: PSU metrics emphasize market share, non-U.S. credit revenue growth, and operating margin over multi-year periods, aligning with strategic goals and shareholder value creation .
- Clawbacks and guidelines: Robust clawbacks and strict ownership/holding policies strengthen pay-for-performance alignment and behavioral controls .
- Governance & shareholder feedback: 2024 say-on-pay passed with ~94% support following extensive investor engagement; peer group reviewed annually for benchmarking .
Investment Implications
- Alignment and incentive quality: Multi-year PSUs (0–200% payout) tied to market share, margin, and diversified revenue support durable, strategy-driven incentives for CRO; 2022 awards funding at 45% underscores outcome sensitivity to execution in these metrics .
- Retention vs. selling pressure: Significant scheduled RSU/PSU vesting through 2026 naturally supports retention; insider trading policy prohibition on hedging/pledging reduces misalignment risk; blackout policies apply post-departure for directors and to employees generally .
- Downside protection: CIC and non-CIC severance multiples plus health benefits and equity acceleration provide meaningful protection, decreasing near-term departure risk; no excise tax gross-up mitigates shareholder-unfriendly optics .
- Ownership posture: 64,555 shares owned (<1%) with compliance to 3× salary guideline (5,899 shares required) signals baseline alignment; broader restrictions (no hedging/pledging) improve signal quality .
- Execution track record: 2024 records in ADV and multi-product revenue, alongside large client engagement volumes, validate commercial execution under CRO remit; supports confidence in revenue scaling initiatives (portfolio trading, data solutions) embedded in incentive metrics .
Appendix: Company Performance Context (2024)
| Metric | 2024 |
|---|---|
| Total Revenues ($mm) | $817.1 |
| Total Expenses ($mm) | $476.2 |
| Net Income ($mm) | $274.2 |
| Diluted EPS ($) | $7.28 |
| Operating Income ($mm) | $340.9 |
| Adjusted Operating Income ($mm) | $392.2 |
| Record ADV (Total, $bn) | $37.1 |
Say-on-pay approval ~94% (2024) after engagement with holders of ~68% of outstanding shares; peer group includes Tradeweb, Cboe, Nasdaq, MSCI, Virtu, FactSet, Morningstar, and others .