What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-04-26 compared with 2023-11-02 · 239 added, 373 removed, 1027 unchanged (37% of the section changed)

9 unchanged sentences

Condensed Consolidated Statements of Financial Condition (Unaudited)

(in thousands, except share data) September 30,

(in thousands, except share data) March 31,

2024 December 31,

3 unchanged sentences

Securities purchased under agreements to resell 502,470 1,512,114

Receivables from broker-dealers and clearing organizations 1,696,495 1,115,185

Receivables from broker-dealers and clearing organizations ($ 22,801 and $ — at fair value, as of March 31, 2024 and December 31, 2023, respectively)

1,270,404 737,724

Trading assets, at fair value:

2 unchanged sentences

Receivables from customers 118,680 106,245

Property, equipment and capitalized software (net of accumulated depreciation of $ 350,220 and $ 460,763 as of September 30, 2023 and December 31, 2022, respectively)

Property, equipment and capitalized software (net of accumulated depreciation of $ 336,866 and $ 367,779 as of March 31, 2024 and December 31, 2023, respectively)

97,436 100,365

1 unchanged sentence

Goodwill 1,148,926 1,148,926

Intangibles (net of accumulated amortization of $ 366,020 and $ 318,013 as of September 30, 2023 and December 31, 2022, respectively)

Intangibles (net of accumulated amortization of $ 396,660 and $ 381,973 as of March 31, 2024 and December 31, 2023, respectively)

242,833 257,520

Deferred tax assets 128,171 133,760

Other assets ($ 74,911 and $ 78,965 , at fair value, as of September 30, 2023 and December 31, 2022, respectively)

Other assets ($ 167,384 and $ 84,521 , at fair value, as of March 31, 2024 and December 31, 2023, respectively)

408,586 303,720

4 unchanged sentences

Securities sold under agreements to repurchase 836,433 1,795,994

Payables to broker-dealers and clearing organizations 540,464 273,843

Payables to broker-dealers and clearing organizations ($ 90,271 and $ 7,661 , at fair value, as of March 31, 2024 and December 31, 2023, respectively)

472,895 1,167,712

Payables to customers 33,485 23,229

9 unchanged sentences

Stockholders' equity

Class A common stock (par value $ 0.00001 ), Authorized — 1,000,000,000 and 1,000,000,000 shares, Issued — 134,865,978 and 133,071,754 shares, Outstanding — 91,455,446 and 98,549,464 shares at September 30, 2023 and December 31, 2022, respectively

Class B common stock (par value $ 0.00001 ), Authorized — 175,000,000 and 175,000,000 shares, Issued and Outstanding — 0 and 0 shares at September 30, 2023 and December 31, 2022, respectively

Class C common stock (par value $ 0.00001 ), Authorized — 90,000,000 and 90,000,000 shares, Issued and Outstanding — 8,607,998 and 9,030,066 shares at September 30, 2023 and December 31, 2022, respectively

Class D common stock (par value $ 0.00001 ), Authorized — 175,000,000 and 175,000,000 shares, Issued and Outstanding — 60,091,740 and 60,091,740 shares at September 30, 2023 and December 31, 2022, respectively

Treasury stock, at cost, 43,410,532 and 34,522,290 shares at September 30, 2023 and December 31, 2022, respectively

Class A common stock (par value $ 0.00001 ), Authorized — 1,000,000,000 and 1,000,000,000 shares, Issued — 136,550,996 and 134,901,037 shares, Outstanding — 88,783,569 and 89,092,686 shares at March 31, 2024 and December 31, 2023, respectively

Class B common stock (par value $ 0.00001 ), Authorized — 175,000,000 and 175,000,000 shares, Issued and Outstanding — 0 and 0 shares at March 31, 2024 and December 31, 2023, respectively

Class C common stock (par value $ 0.00001 ), Authorized — 90,000,000 and 90,000,000 shares, Issued and Outstanding — 8,607,998 and 8,607,998 shares at March 31, 2024 and December 31, 2023, respectively

Class D common stock (par value $ 0.00001 ), Authorized — 175,000,000 and 175,000,000 shares, Issued and Outstanding — 60,091,740 and 60,091,740 shares at March 31, 2024 and December 31, 2023, respectively

Treasury stock, at cost, 47,767,427 and 45,808,351 shares at March 31, 2024 and December 31, 2023, respectively

( 1,202,188 ) ( 1,166,299 )

4 unchanged sentences

stockholders' equity 1,211,722 1,202,727

Noncontrolling interest 245,314 309,528

Virtu Financial, Inc.

1 unchanged sentence

Condensed Consolidated Statements of Financial Condition (Unaudited)

(in thousands, except share data) September 30,

(in thousands, except share data) March 31,

2024 December 31,

Noncontrolling interest 212,355 202,629

Total equity 1,424,077 1,405,356

4 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands, except share and per share data) 2024 2023

39 unchanged sentences

Condensed Consolidated Statements of Changes in Equity (Unaudited)

Three and Nine Months Ended September 30, 2023, and 2022

Three Months Ended March 31, 2024 and 2023

Class A Common Stock Class C Common Stock Class D Common Stock Treasury Stock Additional Paid-in Capital Retained Earnings (Accumulated Deficit) Accumulated Other Comprehensive Income (loss) Total Virtu Financial Inc.

4 unchanged sentences

Share based compensation 2,596,226 — — — — — — — 28,883 — — 28,883 — 28,883

Repurchase of Class C common stock — ( 21,498 ) — — — — — ( 424 ) — — ( 424 ) — ( 424 )

Treasury stock purchases ( 946,267 ) — — — — — ( 1,959,076 ) ( 35,889 ) — ( 16,013 ) — ( 51,902 ) — ( 51,902 )

4 unchanged sentences

— — — — — — — — — ( 22,660 ) — ( 22,660 ) ( 44,929 ) ( 67,589 )

Issuance of common stock in connection with employee exchanges 152,037 — — — — — — — — — — — — —

Repurchase of Virtu Financial Units and corresponding number of Class C common stock in connection with employee exchanges — — ( 152,037 ) — — — — — — — — — — —

Balance at March 31, 2024 136,550,996 $ 1 8,607,998 $ — 60,091,740 $ 1 ( 47,767,427 ) $ ( 1,202,188 ) $ 1,380,457 $ 1,017,547 $ 15,904 $ 1,211,722 $ 212,355 $ 1,424,077

Share based compensation 20,000 — — — — — — — 12,050 — — 12,050 — 12,050

Treasury stock purchases ( 9,147 ) — — — — — ( 2,265,811 ) ( 41,579 ) — ( 165 ) — ( 41,744 ) — ( 41,744 )

Net income — — — — — — — — — 16,702 — 16,702 12,842 29,544

Foreign exchange translation adjustment — — — — — — — — — — 1,503 1,503 1,024 2,527

Net change in unrealized cash flow hedges gains — — — — — — — — — — 4,879 4,879 3,323 8,202

Dividends ($ 0.24 per share of Class A and Class B common stock and participating Restricted Stock Unit and Restricted Stock Awards) and distributions from Virtu Financial to noncontrolling interest

— — — — — — — — — ( 23,908 ) — ( 23,908 ) ( 69,744 ) ( 93,652 )

Balance at June 30, 2023 134,725,247 $ 1 8,856,531 $ — 60,091,740 $ 1 ( 40,720,600 ) $ ( 1,071,784 ) $ 1,335,269 $ 980,481 $ 31,132 $ 1,275,100 $ 277,201 $ 1,552,301

Share based compensation 144,783 — — — — — — — 11,634 $ — — 11,634 — 11,634

Repurchase of Class C common stock — — ( 214,176 ) — — — — — ( 3,596 ) $ — — ( 3,596 ) — ( 3,596 )

Treasury stock purchases ( 38,409 ) — — — — — ( 2,689,932 ) ( 48,717 ) — ( 703 ) — ( 49,420 ) — ( 49,420 )

Net income — — — — — — — — — 61,915 — 61,915 55,678 117,593

Foreign exchange translation adjustment — — — — — — — — — — ( 2,339 ) ( 2,339 ) ( 1,666 ) ( 4,005 )

Net change in unrealized cash flow hedges gains — — — — — — — — — — ( 4,466 ) ( 4,466 ) ( 3,180 ) ( 7,646 )

Dividends ($ 0.24 per share of Class A and Class B common stock and participating Restricted Stock Unit and Restricted Stock Award) and distributions from Virtu Financial to noncontrolling interest

— — — — — — — — — ( 23,492 ) — ( 23,492 ) ( 82,719 ) ( 106,211 )

Repurchase of Virtu Financial Units and corresponding number of Class C common stock in connection with employee exchanges 34,357 — — — — — — — — — — — — —

Issuance of tax receivable agreements in connection with employee exchange — — ( 34,357 ) — — — — — $ — $ — $ — $ — $ — $ —

Balance at September 30, 2023 134,865,978 $ 1 8,607,998 $ — 60,091,740 $ 1 ( 43,410,532 ) $ ( 1,120,501 ) $ 1,343,307 $ 1,018,201 $ 24,327 $ 1,265,336 $ 245,314 $ 1,510,650

Virtu Financial, Inc.

and Subsidiaries

Condensed Consolidated Statements of Changes in Equity (Unaudited)

Three and Nine Months Ended September 30, 2023, and 2022

6 unchanged sentences

Treasury stock purchases ( 902,947 ) — — — — — ( 3,932,499 ) ( 75,568 ) — ( 17,650 ) — ( 93,218 ) — ( 93,218 )

Stock options exercised 246,879 — — — — — — — 4,691 — — 4,691 — 4,691

Net income — — — — — — — — — 57,881 — 57,881 52,202 110,083

6 unchanged sentences

Balance at March 31, 2023 134,714,394 $ 1 8,856,531 $ — 60,091,740 $ 1 ( 38,454,789 ) $ ( 1,030,205 ) $ 1,323,219 $ 987,852 $ 24,750 $ 1,305,618 $ 329,756 $ 1,635,374

Share based compensation — — — — — — — — 9,411 — — 9,411 — 9,411

Repurchase of Class C common stock — — ( 1,800 ) — — — — — ( 52 ) — — ( 52 ) — ( 52 )

Treasury stock purchases — — — — — — ( 1,762,756 ) ( 47,486 ) — — — ( 47,486 ) — ( 47,486 )

Stock options exercised 22,000 — — — — — — — 418 — — 418 — 418

Net income — — — — — — — — — 85,167 — 85,167 63,729 148,896

Foreign exchange translation adjustment — — — — — — — — — — ( 10,773 ) ( 10,773 ) ( 9,037 ) ( 19,810 )

Net change in unrealized cash flow hedges losses — — — — — — — — — — 8,580 8,580 5,482 14,062

Dividends ($ 0.24 per share of Class A and Class B common stock and participating Restricted Stock Units and Restricted Stock Award) and distributions from Virtu Financial to noncontrolling interest

— — — — — — — — — ( 26,067 ) — ( 26,067 ) ( 76,906 ) ( 102,973 )

Issuance of common stock in connection with employee exchanges 21,289 — — — — — — — — — — — — —

Repurchase of Virtu Financial Units and corresponding number of Class C common stock in connection with employee exchanges — — ( 21,289 ) — — — — — — — — — — —

Contributions from noncontrolling interests — $ — — $ — — $ — — $ — $ — $ — $ — $ — $ 39,200 $ 39,200

Balance at June 30, 2022 132,915,640 $ 1 9,030,066 $ — 60,091,740 $ 1 ( 28,998,163 ) $ ( 828,772 ) $ 1,256,760 $ 956,487 $ 13,826 $ 1,398,303 $ 342,105 $ 1,740,408

Share based compensation 131,892 — — — — — — — 9,159 — — 9,159 — 9,159

Treasury stock purchases ( 35,006 ) — — — — — ( 3,439,813 ) ( 80,596 ) — ( 823 ) — ( 81,419 ) — ( 81,419 )

Stock options exercised — — — — — — — — — — — — — —

Net income — — — — — — — — — 40,007 — 40,007 39,867 79,874

Foreign exchange translation adjustment — — — — — — — — — — ( 11,161 ) ( 11,161 ) ( 7,366 ) ( 18,527 )

Net change in unrealized cash flow hedges gains — — — — — — — — — — 18,513 18,513 12,218 30,731

Dividends ($ 0.24 per share of Class A and Class B common stock and participating Restricted Stock Unit and Restricted Stock Award) and distributions from Virtu Financial to noncontrolling interest

— — — — — — — — — ( 25,337 ) — ( 25,337 ) ( 61,981 ) ( 87,318 )

Virtu Financial, Inc.

and Subsidiaries

Condensed Consolidated Statements of Changes in Equity (Unaudited)

Three and Nine Months Ended September 30, 2023, and 2022

Stockholders' Equity Noncontrolling Interest Total Equity

(in thousands, except share and interest data)

Shares Amounts Shares Amounts Shares Amounts Shares Amounts Amounts

Balance at September 30, 2022 133,012,526 $ 1 9,030,066 $ — 60,091,740 $ 1 ( 32,437,976 ) $ ( 909,368 ) $ 1,265,919 $ 970,334 $ 21,178 $ 1,348,065 $ 324,843 $ 1,672,908

See accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited).

2 unchanged sentences

Condensed Consolidated Statements of Cash Flows (Unaudited)

Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands) 2024 2023

25 unchanged sentences

Accounts payable, accrued expenses and other liabilities ( 58,776 ) ( 88,745 )

Net cash provided by operating activities 143,691 290,462

Net cash used in operating activities ( 395,414 ) ( 148,382 )

Cash flows from investing activities

7 unchanged sentences

Purchase of treasury stock ( 51,823 ) ( 93,218 )

Stock options exercised — 5,109

Short-term borrowings, net 140,000 121,055

Proceeds from long-term borrowings — 1,800,000

Repayment of long-term borrowings — ( 18,000 )

1 unchanged sentence

Debt issuance costs — ( 3,953 )

Contributions from noncontrolling interests — 39,200

Net cash used in financing activities ( 385,285 ) ( 466,498 )

Net cash provided by (used in) financing activities 362 ( 46,544 )

Effect of exchange rate changes on cash and cash equivalents ( 3,526 ) 1,648

Net decrease in cash and cash equivalents ( 311,887 ) ( 230,506 )

Net increase (decrease) in cash and cash equivalents ( 426,054 ) ( 229,061 )

Cash, cash equivalents, and restricted or segregated cash, beginning of period 855,460 1,038,242

1 unchanged sentence

Supplementary disclosure of cash flow information

Cash paid for interest $ 142,200 $ 96,572

Cash paid for taxes 6,609 3,471

Virtu Financial, Inc.

1 unchanged sentence

Condensed Consolidated Statements of Cash Flows (Unaudited)

Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands) 2024 2023

Cash paid for interest $ 370,761 $ 168,739

Cash paid for taxes 33,595 100,844

Non-cash investing activities

Share-based and accrued incentive compensation to developers relating to capitalized software 4,101 4,732

Non-cash financing activities

Repurchase of Class C common stock ( 4,020 ) —

See accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited).

7 unchanged sentences

VFI is a Delaware corporation whose primary asset is its ownership interest in Virtu Financial LLC (“Virtu Financial”).

As of September 30, 2023, VFI owned approximately 58.4 % of the membership interests of Virtu Financial.

As of March 31, 2024, VFI owned approximately 57.8 % of the membership interests of Virtu Financial.

VFI is the sole managing member of Virtu Financial and operates and controls all of the businesses and affairs of Virtu Financial and its subsidiaries (the “Group”).

43 unchanged sentences

For a detailed discussion of the Company's significant accounting policies, see Note 2 “Summary of Significant Accounting Policies” in our consolidated financial statements included in Part II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, 2023.

Goodwill represents the excess of the purchase price over the underlying net tangible and intangible assets of the Company’s acquisitions.

Goodwill is not amortized but is assessed for impairment on an annual basis and between annual assessments whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.

Goodwill is assessed at the reporting unit level, which is defined as an operating segment or one level below the operating segment.

The Company assesses goodwill for impairment on an annual basis on July 1 and on an interim basis when certain events occur or certain circumstances exist.

In its impairment assessment as of July 1, 2023, the Company performed a quantitative assessment of each reporting unit and the estimated fair value of each of the reporting units exceeded its respective carrying value, and therefore goodwill was not impaired.

The estimated fair value of each reporting unit was based on valuation techniques the firm believes market participants would use to value these reporting units, and allocated the enterprise value to each reporting unit based on an estimate of relative fair value for each reporting unit.

The carrying value of each reporting unit reflects an allocation of total shareholders’ equity and represents the estimated amount of total shareholders’ equity required to support the activities of the applicable reporting unit under currently applicable regulatory capital requirements.

Accounting Pronouncements Recently Adopted

Derivatives and Hedging - In March 2022, the FASB issued ASU 2022-01, Derivatives and Hedging - Fair Value Hedging - Portfolio Layer Method (Topic 815) .

The ASU expands the scope of permissible hedging, and permits the use of different derivative structures as hedging instruments.

The Company adopted this ASU on January 1, 2023 and it did not have a material impact on its condensed consolidated financial statements.

Liabilities - Supplier Finance Programs - In September 2022, the FASB issued ASU 2022-04, Liabilities—Supplier Finance Programs (Subtopic 405-50) .

This ASU requires new quantitative and qualitative disclosure requirements for a buyer who enters into supplier financing programs.

The Company adopted this ASU on January 1, 2023 and it did not have a material impact on its condensed consolidated financial statements.

The FASB issued ASU 2023-03, Presentation of Financial Statements (Topic 205), Income Statement—Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from Equity (Topic 480), Equity (Topic 505), and Compensation—Stock Compensation (Topic 718):

Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No.

120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280—General Revision of Regulation S-X:

Income or Loss Applicable to Common Stock (SEC Update) in July 2023, and ASU 2023-04, Liabilities (Topic 405):

Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No.

121 (SEC Update) in August 2023.

These ASUs amend and supersede various SEC paragraphs across multiple topics within the Codification to conform to past SEC announcements and guidance issued by the SEC.

As the ASUs do not provide any new accounting standards, no transition or effective dates are associated with them.

As such, the Company considers these adopted as of September 30, 2023 with no material impact on its condensed consolidated financial statements.

Accounting Pronouncements Not Yet Adopted as of September 30, 2023

Fair Value Measurement - In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (Topic 326) .

1 unchanged sentence

Additionally, this ASU requires disclosure of the nature and remaining duration of the sale restriction.

This ASU is effective for periods beginning after December 15, 2023.

The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its condensed consolidated financial statements.

The Company adopted this ASU on January 1, 2024, and it did not have a material impact on its Condensed Consolidated Financial Statements.

Leases - Common Control Arrangements - In March 2023, the FASB issued ASU 2023-01, Leases—Common Control Arrangements (Topic 842) .

This ASU provides updated guidance for accounting for common control leases and leasehold improvements.

This ASU is effective for periods beginning after December 15, 2023.

The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its condensed consolidated financial statements.

The Company adopted this ASU on January 1, 2024, and it did not have a material impact on its Condensed Consolidated Financial Statements.

Investments - Equity Method and Joint Ventures - In March 2023, the FASB issued ASU 2023-02, Investments—Equity Method and Joint Ventures (Topic 323) .

This ASU provides updated guidance for accounting for investments in tax credit structures.

This ASU is effective for periods beginning after December 15, 2023.

The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its condensed consolidated financial statements.

The Company adopted this ASU on January 1, 2024, and it did not have a material impact on its Condensed Consolidated Financial Statements.

Accounting Pronouncements Not Yet Adopted as of March 31, 2024

Business Combinations—Joint Venture Formations - In August 2023, the FASB issued ASU 2023-05, Business Combinations—Joint Venture Formations (Subtopic 805-60) .

1 unchanged sentence

This ASU is effective prospectively for joint ventures formed on or after January 1, 2025.

The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its condensed consolidated financial statements.

The Company does not expect it to have a material impact on its Condensed Consolidated Financial Statements.

Segment Reporting - In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) .

This ASU requires incremental disclosures related to a public entity’s reportable segments.

It aims to provide financial statement users with more disaggregated information, specifically, significant expenses for each reportable segment.

This ASU is effective for fiscal years beginning after December 15, 2023 and for interim periods within fiscal years beginning after December 15, 2024.

The Company does not expect it to have a material impact on its Condensed Consolidated Financial Statements and related disclosures.

Intangibles—Goodwill and Other—Crypto Assets - In December 2023, the FASB issued ASU 2023-08, Intangibles—Goodwill and Other—Crypto Assets (Subtopic 350-60) .

This ASU requires measurement of in-scope crypto assets at fair value and provides updated guidance on presentation and disclosure requirements for crypto assets.

This ASU is effective for periods beginning after December 15, 2024.

The Company is currently evaluating the impact of this ASU on its Condensed Consolidated Financial Statements and related disclosures, and will adopt the disclosure requirements for the periods beginning after December 15, 2024.

Income Taxes - In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) .

This ASU requires disclosure of additional information on effective tax rate reconciliation and income taxes paid.

This ASU is effective for periods beginning after December 15, 2024.

The Company is currently evaluating the impact of this ASU but does not expect it to have a material impact on its Condensed Consolidated Financial Statements and related disclosures.

Earnings per Share

The below table contains a reconciliation of Net income before income taxes and noncontrolling interest to Net income available for common stockholders:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands) 2024 2023

5 unchanged sentences

The calculation of basic and diluted earnings per share is presented below:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands, except for share or per share data) 2024 2023

6 unchanged sentences

Basic earnings per share $ 0.59 $ 0.56

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands, except for share or per share data) 2024 2023

6 unchanged sentences

Diluted earnings per share (1) $ 0.59 $ 0.56

(1) The dilutive impact of unexercised stock options excludes from the computation of EPS 68,988 options for the three months ended September 30, 2023, and 34,622 options for the nine months ended September 30, 2023 because inclusion of the options would have been anti-dilutive.

(1) Excluded from the computation of diluted Earnings per share were 45,814 unexercised stock options for the three months ended March 31, 2024 because inclusion of the options would have been anti-dilutive.

Tax Receivable Agreements

2 unchanged sentences

Subsequent adjustments of the tax receivable agreements obligations due to certain events (e.g., changes to the expected realization of NOLs or changes in tax rates) will be recognized within income before taxes and noncontrolling interests in the Condensed Consolidated Statements of Comprehensive Income.

The Company made its first payment of $ 7.0 million in February 2017, and subsequent payments of $ 12.4 million in September 2018, $ 13.3 million in March 2020, $ 16.5 million in April 2021, $ 21.3 million in March 2022, and $ 23.3 million in April 2023.

Tax receivable payments are expected to range from approximately $ 36.4 thousand to $ 22.0 million per year over the next 15 years.

At September 30, 2023 and December 31, 2022, the Company’s remaining deferred tax assets that relate to the matters described above were approximately $ 146.5 million and $ 162.1 million, respectively, and the Company’s liabilities over the next 15 years pursuant to the tax receivable agreements were approximately $ 215.5 million and $ 238.8 million for September 30, 2023 and December 31, 2022, respectively.

The amounts recorded as of September 30, 2023 and December 31, 2022 are based on best estimates available at the respective dates and may be subject to change after the filing of the Company’s U.S.

Tax receivable payments are expected to range from approximately $ 0.1 million to $ 22.0 million per year over the next 15 years.

At March 31, 2024 and December 31, 2023, the Company’s remaining deferred tax assets that relate to the matters described above were approximately $ 130.2 million and $ 135.7 million, respectively, and the Company’s liabilities over the next 15 years pursuant to the tax receivable agreements were approximately $ 196.3 million and $ 216.5 million for March 31, 2024 and December 31, 2023, respectively.

The amounts recorded as of March 31, 2024 and December 31, 2023 are based on best estimates available at the respective dates and may be subject to change after the filing of the Company’s U.S.

federal and state income tax returns for the years in which tax savings were realized.

4 unchanged sentences

and one non-operating segment:

As of September 30, 2023 and December 31, 2022, the Company’s total amount of goodwill recorded was $ 1,148.9 million.

No goodwill impairment was recognized during the three and nine months ended September 30, 2023 and 2022.

The following table presents the details of goodwill by segment as of September 30, 2023 and December 31, 2022:

As of March 31, 2024 and December 31, 2023, the Company’s total amount of goodwill recorded was $ 1,148.9 million.

No goodwill impairment was recognized during the three months ended March 31, 2024 and 2023.

The following table presents the details of goodwill by segment as of March 31, 2024 and December 31, 2023:

(in thousands) Market Making Execution Services Corporate Total

Balance as of period-end $ 755,292 $ 393,634 $ — $ 1,148,926

As of September 30, 2023 and December 31, 2022, the Company's total amount of intangible assets recorded was $ 273.5 million and $ 321.5 million, respectively.

Acquired intangible assets consisted of the following as of September 30, 2023 and December 31, 2022:

As of September 30, 2023

As of March 31, 2024 and December 31, 2023, the Company's total amount of intangible assets recorded was $ 242.8 million and $ 257.5 million, respectively.

Acquired intangible assets consisted of the following as of March 31, 2024 and December 31, 2023:

As of March 31, 2024

(in thousands) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Useful Lives

19 unchanged sentences

$ 639,493 $ ( 381,973 ) $ 257,520

Amortization expense relating to finite-lived intangible assets was approximately $ 16.0 million and $ 16.1 million for the three months ended September 30, 2023, and 2022, respectively, and $ 48.0 million, and $ 48.8 million for the nine months ended September 30, 2023, and 2022, respectively.

Amortization expense relating to finite-lived intangible assets was approximately $ 14.7 million and $ 16.0 million for the three months ended March 31, 2024 and 2023, respectively.

This is included in Amortization of purchased intangibles and acquired capitalized software in the accompanying Condensed Consolidated Statements of Comprehensive Income.

3 unchanged sentences

Receivables from/Payables to Broker-Dealers and Clearing Organizations

The following is a summary of receivables from and payables to brokers-dealers and clearing organizations at September 30, 2023 and December 31, 2022:

(in thousands) September 30, 2023 December 31, 2022

The following is a summary of receivables from and payables to brokers-dealers and clearing organizations at March 31, 2024 and December 31, 2023:

(in thousands) March 31, 2024 December 31, 2023

Due from prime brokers $ 410,153 $ 208,639

12 unchanged sentences

(1) The Company presents its balances, including outstanding principal balances on all broker credit facilities, on a net-by-counterparty basis within receivables from and payables to broker-dealers and clearing organizations when the criteria for offsetting are met .

Included as a deduction from “Due from prime brokers” and “Net equity with futures commission merchants” is the outstanding principal balance on all of the Company’s prime brokerage credit facilities (described in Note 8 "Borrowings") of approximately $ 93.6 million and $ 212.9 million as of September 30, 2023 and December 31, 2022, respectively.

Included as a deduction from “Due from prime brokers” and “Net equity with futures commission merchants” is the outstanding principal balance on all of the Company’s prime brokerage credit facilities (described in Note 8 “Borrowings”) of approximately $ 170.7 million and $ 175.3 million as of March 31, 2024 and December 31, 2023, respectively.

The loan proceeds from the credit facilities are available only to meet the initial margin requirements associated with the Company’s ordinary course futures and other trading positions, which are held in the Company’s trading accounts with an affiliate of the respective financial institutions.

3 unchanged sentences

The Company is permitted to sell or repledge securities received as collateral and use these securities to secure repurchase agreements, enter into securities lending transactions or deliver these securities to counterparties or clearing organizations to cover short positions.

At September 30, 2023 and December 31, 2022, substantially all of the securities received as collateral have been repledged.

The fair value of the collateralized transactions at September 30, 2023 and December 31, 2022 are summarized as follows:

(in thousands) September 30, 2023 December 31, 2022

At March 31, 2024 and December 31, 2023, substantially all of the securities received as collateral have been repledged.

The fair value of the collateralized transactions at March 31, 2024 and December 31, 2023 are summarized as follows:

(in thousands) March 31, 2024 December 31, 2023

Securities received as collateral:

3 unchanged sentences

In the normal course of business, the Company pledges qualified securities with clearing organizations to satisfy daily margin and clearing fund requirements.

Financial instruments owned and pledged, where the counterparty has the right to repledge, at September 30, 2023 and December 31, 2022 consisted of the following:

(in thousands) September 30, 2023 December 31, 2022

Financial instruments owned and pledged, where the counterparty has the right to repledge, at March 31, 2024 and December 31, 2023 consisted of the following:

(in thousands) March 31, 2024 December 31, 2023

Equities $ 1,441,851 $ 1,222,559

3 unchanged sentences

The following summarizes the Company's short-term borrowing balances outstanding, net of related debt issuance costs, with each described in further detail below.

September 30, 2023

March 31, 2024

(in thousands) Borrowing Outstanding Deferred Debt Issuance Cost Short-term Borrowings, net

3 unchanged sentences

(in thousands) Borrowing Outstanding Deferred Debt Issuance Cost Short-term Borrowings, net

Short-term bank loans 3,944 — 3,944

$ 3,944 $ — $ 3,944

Broker-dealer credit facilities $ — $ — $ —

The Company is a party to two secured credit facilities with a financial institution to finance overnight securities positions purchased as part of its ordinary course broker-dealer market making activities.

Broker-Dealer Credit Facilities

The Company is a party to two secured credit facilities with a financial institution to finance overnight securities positions purchased as part of its ordinary course U.S.

broker-dealer market making activities.

One of the facilities (the “Uncommitted Facility”) is provided on an uncommitted basis with an aggregate borrowing limit of $ 400 million, and is collateralized by VAL's trading and deposit account maintained at the financial institution.

9 unchanged sentences

The facility has an aggregate borrowing limit of $ 10 million, and bears interest at the adjusted SOFR or base rate plus 3.5 % per annum.

On March 20, 2020, VAL entered into a Loan Agreement (the “Founder Member Loan Facility”) with TJMT Holdings LLC (the “Founder Member”), as lender and administrative agent, providing for unsecured term loans from time to time (the “Founder Member Loans”) in an aggregate original principal amount not to exceed $ 300 million.

The Founder Member Loans were available to be borrowed in one or more borrowings on or after March 20, 2020 and prior to September 20, 2020 (the "Founder Member Loan Term").

The Founder Member Loan Facility Term expired as of September 20, 2020 without VAL having borrowed any Founder Member Loans at any time.

The Founder Member is an affiliate of Mr.

Vincent Viola, the Company’s founder and Chairman Emeritus.

Upon the execution of and in consideration for the Lender’s (as defined in the Founder Member Loan Facility) commitments under the Founder Member Loan Facility, the Company delivered to the Founder Member a warrant to purchase shares of the Company’s Class A Common Stock.

Terms of the warrant are set forth in further detail in Note 17 "Capital Structure".

The following summarizes the Company’s broker-dealer credit facilities' carrying values, net of unamortized debt issuance costs, where applicable.

These balances are included within Short-term borrowings on the Condensed Consolidated Statements of Financial Condition.

At September 30, 2023

At March 31, 2024

(in thousands) Interest Rate Financing Available Borrowing Outstanding Deferred Debt Issuance Cost Outstanding Borrowings, net

4 unchanged sentences

$ 1,060,000 $ 140,000 $ ( 1,798 ) $ 138,202

(1) Interest rate for Borrowing Base A Loan and Borrowing Base B Loan under the Committed Facility was 6.75 % and 9.00 %, respectively.

There was no balance outstanding under Borrowing Base B Loan as of March 31, 2024.

At December 31, 2023

8 unchanged sentences

Interest expense is included within Interest and dividends expense in the accompanying Condensed Consolidated Statements of Comprehensive Income.

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands) 2024 2023

6 unchanged sentences

The Company’s international securities clearance and settlement activities are funded with operating cash or with short-term bank loans in the form of overdraft facilities.

At September 30, 2023, there was no balance associated with international settlement activities outstanding under these facilities.

At December 31, 2022, there was $ 3.9 million associated with international settlement activities outstanding under these facilities at a weighted average interest rate of approximately 3.8 %.

These short-term bank loan balances are included within Short-term borrowings on the condensed consolidated statements of financial condition.

At March 31, 2024 and December 31, 2023, there was no balance associated with international settlement activities outstanding under these facilities.

Outstanding short-term bank loan balances are included within Short-term borrowings on the Condensed Consolidated Statements of Financial Condition.

Prime Brokerage Credit Facilities

1 unchanged sentence

The proceeds of these facilities are used to meet margin requirements associated with the products traded by the Company in the ordinary course, and amounts borrowed are collateralized by the Company’s trading accounts with the applicable financial institution.

At September 30, 2023

At March 31, 2024

(in thousands) Weighted Average

12 unchanged sentences

(1) Outstanding borrowings are included with Receivables from/Payables to broker-dealers and clearing organizations within the Condensed Consolidated Statements of Financial Condition.

Interest expense in relation to the facilities was $ 3.3 million and $ 2.6 million for the three months ended September 30, 2023 and 2022, respectively, and $ 10.4 million and $ 5.9 million for the nine months ended September 30, 2023 and 2022, respectively.

Interest expense in relation to the facilities was $ 2.6 million and $ 3.5 million for the three months ended March 31, 2024 and 2023, respectively.

Long-Term Borrowings

The following summarizes the Company’s long-term borrowings, net of unamortized discount and debt issuance costs, where applicable:

At September 30, 2023

At March 31, 2024

(in thousands) Maturity

13 unchanged sentences

$ 1,751,816 $ ( 3,107 ) $ ( 21,504 ) $ 1,727,205

Credit Agreements

In connection with the ITG Acquisition, Virtu Financial, VFH, and Impala Borrower LLC (the "Acquisition Borrower") entered into a credit agreement, with the lenders party thereto, Jefferies Finance LLC, as administrative agent and Jefferies Finance LLC and RBC Capital Markets, as joint lead arrangers and joint bookrunners (the "Acquisition Credit Agreement").

Credit Agreement

On January 13, 2022 (the “Credit Agreement Closing Date”), Virtu Financial, VFH Parent LLC, a Delaware limited liability company and a subsidiary of Virtu Financial (“VFH”), entered into a credit agreement with the lenders party thereto, JPMorgan Chase Bank, N.A.

as administrative agent and JPMorgan Chase Bank, N.A., Goldman Sachs Bank USA, RBC Capital Markets, Barclays Bank plc, Jefferies Finance LLC, BMO Capital Markets Corp., and CIBC World Markets Corp., as joint lead arrangers and bookrunners (the “Credit Agreement”).

The Credit Agreement provides (i) a senior secured first lien term loan in an aggregate principal amount of $ 1,800.0 million, drawn in its entirety on the Credit Agreement Closing Date, the proceeds of which were used by VFH to repay all amounts outstanding under the Acquisition Credit Agreement, to pay fees and expenses in connection therewith, to fund share repurchases under the Company’s repurchase program, and for general corporate purposes, and (ii) a $ 250.0 million senior secured first lien revolving facility to VFH, with a $ 20.0 million letter of credit subfacility and a $ 20.0 million swingline subfacility.

The Credit Agreement provides (i) a senior secured first lien term loan in an aggregate principal amount of $ 1,800.0 million, drawn in its entirety on the Credit Agreement Closing Date, the proceeds of which were used by VFH to repay all amounts outstanding under the previous Credit Agreement, to pay fees and expenses in connection therewith, to fund share repurchases under the Company’s repurchase program, and for general corporate purposes, and (ii) a $ 250.0 million senior secured first lien revolving facility to VFH, with a $ 20.0 million letter of credit subfacility and a $ 20.0 million swingline subfacility.

The term loan borrowings and revolver borrowings under the Credit Agreement bear interest at a per annum rate equal to, at the Company’s election, either (i) the greatest of (a) the prime rate in effect, (b) the greater of (1) the federal funds effective rate and (2) the overnight bank funding rate, in each case plus 0.50 %, (c) an adjusted term SOFR rate with an interest period of one month plus 1.00 % and (d)(1) in the case of term loan borrowings, 1.50 % and (2) in the case of revolver borrowings, 1.00 %, plus, (x) in the case of term loan borrowings, 2.00 % and (y) in the case of revolver borrowings, 1.50 %, or (ii) the greater of (a) an adjusted term SOFR rate for the interest period in effect and (b) (1) in the case of term loan borrowings, 0.50 % and (2) in the case of revolver borrowings, 0.00 %, plus, (x) in the case of term loan borrowings, 3.00 % and (y) in the case of revolver borrowings, 2.50 %.

6 unchanged sentences

Under the Credit Agreement, the term loans will mature on January 13, 2029.

The term loans amortize in annual installments equal to 1.0 % of the original aggregate principal amount of the term loans and the Company repaid $ 18.0 million on January 13, 2023.

The term loans amortize in annual installments equal to 1.0 % of the original aggregate principal amount of the term loans and the Company repaid $ 18.0 million

on January 13, 2023.

On December 12, 2023, the Company made a voluntary prepayment of $ 55.0 million, and the payment is applied toward subsequent annual amortization installments.

The revolving commitments will terminate on January 13, 2025.

As of September 30, 2023, $ 1,782 million was outstanding under the term loans, and there were no amounts outstanding under the first lien revolving facility.

As of March 31, 2024, $ 1,727 million was outstanding under the term loans, and there were no amounts outstanding under the first lien revolving facility.

In October 2019, the Company entered into a five-year $ 525 million floating-to-fixed interest rate swap agreement.

5 unchanged sentences

The effective fixed interest payment obligations remained at 4.5 %, with respect to the earlier maturing swap arrangement, and 4.6 % with respect to the later maturing swap arrangement.

In December 2023, the Company terminated the two interest rate swap arrangements and received $ 55.8 million in proceeds from the counterparty.

The Company therefore dedesignated those cash flow hedges under ASC 815, and the amounts in AOCI related to the terminated swaps are to be amortized through interest expense.

The Company simultaneously entered into a two-year $ 1,525 million floating-to-fixed interest rate swap agreement with the same counterparty.

The new interest rate swap met the criteria to be considered and was designated as a qualifying cash flow hedge under ASC 815 as of December 2023, and it effectively fixed interest payment obligations on $ 1,525 million of principal under the First Lien Term Loan Facility at rate of 7.5 % through November 2025, based on the interest rates set forth in the Credit Agreement.

On July 25, 2016, VFH issued Japanese Yen Bonds (collectively the “SBI Bonds”) in the aggregate principal amount of ¥ 3.5 billion ($ 33.1 million at issuance date) to SBI Life Insurance Co., Ltd.

6 unchanged sentences

In December 2022, the maturity of the SBI Bonds was extended to 2026.

The principal balance was ¥ 3.5 billion ($ 23.4 million) as of September 30, 2023 and ¥ 3.5 billion ($ 26.7 million) as of December 31, 2022.

The Company had a gain of $ 0.8 million and a gain of $ 1.6 million for the three months ended September 30, 2023 and 2022, respectively, and a gain of $ 3.3 million, and a gain of $ 6.5 million, during the nine months ended September 30, 2023 and 2022, respectively, due to changes in foreign currency rates.

As of September 30, 2023, aggregate future required minimum principal payments based on the terms of the long-term borrowings were as follows:

(in thousands) September 30, 2023

The principal balance was ¥ 3.5 billion ($ 23.1 million) as of March 31, 2024 and ¥ 3.5 billion ($ 24.8 million) as of December 31, 2023.

The Company had a gain of $ 1.7 million and $ 0.3 million during the three months ended March 31, 2024 and 2023, respectively, due to changes in foreign currency rates.

As of March 31, 2024, aggregate future required minimum principal payments based on the terms of the long-term borrowings were as follows:

(in thousands) March 31, 2024

Remainder of 2024 $ —

Thereafter 1,692,000

2029 1,692,000

Total principal of long-term borrowings $ 1,750,125

2 unchanged sentences

The fair value of equities, options, on-the-run U.S.

government obligations and exchange traded notes is estimated using recently executed transactions and market price quotations in active markets and are categorized as Level 1 with the exception of inactively traded equities and certain other financial instruments, which are categorized as Level 2.

The Company’s corporate bonds, derivative contracts and other U.S.

government obligations have been categorized as Level 2.

government obligations, exchange traded notes and digital assets is estimated using recently executed transactions and market price quotations in active markets and are categorized as Level 1 with the exception of inactively traded equities and certain other financial instruments, which are categorized as Level 2.

The Company’s corporate bonds, derivative contracts, other U.S.

government obligations and receivables and payables linked to digital assets have been categorized as Level 2.

Fair value of the Company’s derivative contracts is based on the indicative prices obtained from a number of banks and broker-dealers, as well as management’s own analyses.

5 unchanged sentences

Consequently, such financial instruments are classified as Level 2.

Fair value measurements for those items measured on a recurring basis are summarized below as of September 30, 2023:

September 30, 2023

Fair value measurements for those items measured on a recurring basis are summarized below as of March 31, 2024:

March 31, 2024

(in thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Counterparty and Cash Collateral Netting Total Fair Value

12 unchanged sentences

Equity investment $ — $ — $ 84,587 $ — $ 84,587

Digital assets 79,982 — — 79,982

Exchange stock 2,815 — — — 2,815

2 unchanged sentences

Interest rate swap $ — $ 5,753 $ — $ — $ 5,753

Receivables linked to digital assets 17,048 17,048

$ — $ 22,801 $ — $ — $ 22,801

Financial instruments sold, not yet purchased, at fair value:

6 unchanged sentences

$ 2,100,385 $ 3,847,758 $ — $ ( 253,146 ) $ 5,694,997

Payables to broker dealers and clearing organizations:

Payables linked to digital assets $ — $ 90,271 $ — $ — $ 90,271

$ — $ 90,271 $ — $ — $ 90,271

Fair value measurements for those items measured on a recurring basis are summarized below as of December 31, 2023:

16 unchanged sentences

$ 2,716 $ — $ 81,805 $ — $ 84,521

Receivables from broker dealers and clearing organizations:

Interest rate swap — 87,268 — — 87,268

Financial instruments sold, not yet purchased, at fair value:

6 unchanged sentences

$ 1,632,305 $ 4,775,358 $ — $ ( 336,311 ) $ 6,071,352

Payables to broker dealers and clearing organizations:

Interest rate swap $ — $ 7,661 $ — $ — $ 7,661

$ — $ 7,661 $ — $ — $ 7,661

JNX Investment

3 unchanged sentences

The JNX Investment is included within Level 3 of the fair value hierarchy.

As of September 30, 2023 and December 31, 2022, the fair value of the JNX Investment was determined using a weighted average of valuations using 1) the discounted cash flow method, an income approach;

As of March 31, 2024 and December 31, 2023, the fair value of the JNX Investment was determined using a weighted average of valuations using 1) the discounted cash flow method, an income approach;

2) a market approach based on average enterprise value/EBITDA ratios of comparable companies;

2 unchanged sentences

The table below presents information on the valuation techniques, significant unobservable inputs and their ranges for the JNX Investment:

September 30, 2023

March 31, 2024

(in thousands) Fair Value Valuation Technique Significant Unobservable Input Range Weighted Average

9 unchanged sentences

The following presents the changes in the Company's Level 3 financial instruments measured at fair value on a recurring basis:

Three Months Ended September 30, 2023

(in thousands) Balance at June 30, 2023 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at September 30, 2023 Change in Net Unrealized Gains / (Losses) on Investments still held at September 30, 2023

Other assets:

Equity investment $ 71,059 $ — $ 1,340 $ — $ — $ 72,399 $ 1,340

Total $ 71,059 $ — $ 1,340 $ — $ — $ 72,399 $ 1,340

(1) Total realized and unrealized gains/(losses) includes gains and losses due to fluctuations in currency rates as well as gains and losses recognized on changes in the fair value of the JNX Investment.

Three Months Ended September 30, 2022

(in thousands) Balance at June 30, 2022 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at September 30, 2022 Change in Net Unrealized Gains / (Losses) on Investments still held at September 30, 2022

Other assets:

Equity investment $ 77,562 $ — $ ( 5,937 ) $ — $ — $ 71,625 $ ( 5,937 )

Total $ 77,562 $ — $ ( 5,937 ) $ — $ — $ 71,625 $ ( 5,937 )

Nine Months Ended September 30, 2023

(in thousands) Balance at December 31, 2022 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at September 30, 2023 Change in Net Unrealized Gains / (Losses) on Investments still held at September 30, 2023

Three Months Ended March 31, 2024

(in thousands) Balance at December 31, 2023 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at March 31, 2024 Change in Net Unrealized Gains / (Losses) on Investments still held at March 31, 2024

Other assets:

2 unchanged sentences

Nine Months Ended September 30, 2022

(in thousands) Balance at December 31, 2021 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at September 30, 2022 Change in Net Unrealized Gains / (Losses) on Investments still held at September 30, 2022

Three Months Ended March 31, 2023

(in thousands) Balance at December 31, 2022 Purchases Total Realized and Unrealized Gains / (Losses) (1) Net Transfers into (out of) Level 3 Settlement Balance at March 31, 2023 Change in Net Unrealized Gains / (Losses) on Investments still held at March 31, 2023

Other assets:

7 unchanged sentences

The fair value of the Company’s long-term borrowings is based on quoted prices from the market for similar instruments, and is categorized as Level 2 in the fair value hierarchy.

The table below summarizes financial assets and liabilities not carried at fair value on a recurring basis as of September 30, 2023:

September 30, 2023

The table below summarizes financial assets and liabilities not carried at fair value on a recurring basis as of March 31, 2024:

March 31, 2024

Carrying Value Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs

36 unchanged sentences

Securities sold under agreements to repurchase 1,795,994 1,795,994 — 1,795,994 —

Payables to broker dealer and clearing organizations 273,843 273,843 — 273,843 —

Payables to broker-dealers and clearing organizations 1,160,051 1,160,051 — 1,160,051 —

Payables to customers 23,229 23,229 — 23,229 —

7 unchanged sentences

In the tables below, the amounts of financial instruments owned that are not offset in the Condensed Consolidated Statements of Financial Condition, but could be netted against financial liabilities with specific counterparties under legally enforceable master netting agreements in the event of default, are presented to provide financial statement readers with the Company’s estimate of its net exposure to counterparties for these financial instruments.

The following tables set forth the gross and net presentation of certain financial assets and financial liabilities as of September 30, 2023 and December 31, 2022:

September 30, 2023

The following tables set forth the gross and net presentation of certain financial assets and financial liabilities as of March 31, 2024 and December 31, 2023:

March 31, 2024

Gross Amounts of Recognized Assets Amounts Offset in the Condensed Consolidated Statement of Financial Condition Net Amounts of Assets Presented in the Condensed Consolidated Statements of Financial Condition Amounts Not Offset in the Condensed Consolidated Statements of Financial Condition

10 unchanged sentences

Gross Amounts of Recognized Liabilities Amounts Offset in the Condensed Consolidated Statement of Financial Condition Net Amounts of Liabilities Presented in the Consolidated Statement of Financial Condition Amounts Not Offset in the Condensed Consolidated Statements of Financial Condition

(in thousands) Financial Instruments Counterparty Netting/ Cash Collateral Net Amount

(in thousands) Financial Instrument Collateral

Counterparty Netting/ Cash Collateral Net Amount

Offsetting of Financial Liabilities:

11 unchanged sentences

Securities purchased under agreements to resell 1,512,114 — 1,512,114 ( 1,512,114 ) —

Receivables from broker-dealers and clearing organizations

Interest rate swaps 87,268 — 87,268 — — 87,268

Trading assets, at fair value:

7 unchanged sentences

Securities sold under agreements to repurchase 1,795,994 — 1,795,994 ( 1,795,994 ) —

Interest rate swaps 7,661 — 7,661 — — 7,661

Trading liabilities, at fair value:

2 unchanged sentences

Total $ 3,475,372 $ ( 336,311 ) $ 3,139,061 $ ( 3,087,370 ) $ ( 34,423 ) $ 17,268

The following table presents gross obligations for securities sold under agreements to repurchase and for securities lending transactions by remaining contractual maturity and the class of collateral pledged as of September 30, 2023 and December 31, 2022:

September 30, 2023

March 31, 2024

Remaining Contractual Maturity

20 unchanged sentences

Derivative Instruments

The fair value of the Company’s derivative instruments on a gross basis consisted of the following at September 30, 2023 and December 31, 2022:

(in thousands) September 30, 2023 December 31, 2022

The fair value of the Company’s derivative instruments on a gross basis consisted of the following at March 31, 2024 and December 31, 2023:

(in thousands) March 31, 2024 December 31, 2023

Derivatives Assets Financial Statement Location Fair Value Notional Fair Value Notional

16 unchanged sentences

Currency forwards Financial instruments sold, not yet purchased 253,151 27,691,487 339,085 33,560,544

Derivative instruments designated as hedging instruments:

Interest rate swaps Payables to broker-dealers and clearing organizations — — 7,661 1,525,000

Amounts included in receivables from and payables to broker-dealers and clearing organizations represent net variation margin on long and short futures contracts as well as amounts receivable or payable on interest rate swaps.

The following table summarizes the net gain (loss) from derivative instruments not designated as hedging instruments under ASC 815, which are recorded in total revenues, and from those designated as hedging instruments under ASC 815, which are initially recorded in other comprehensive income in the accompanying Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2023 and 2022.

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands) Financial Statements Location 2024 2023

4 unchanged sentences

Interest rate swap on term loan Other, net — ( 463 )

Terminated interest rate swaps Financing interest expense on long-term borrowings ( 11,702 ) —

$ ( 3,193 ) $ 63,721

4 unchanged sentences

These two interest rate swaps met the criteria to be considered qualifying cash flow hedges under ASC 815 in the first quarter of 2020, and as such, the mark-to-market gains (losses) on the instruments were deferred within Other comprehensive income on the Condensed Consolidated Statements of Comprehensive Income beginning in the first quarter of 2020.

The two interest rate swaps were terminated and dedesignated as cash flow hedges in December 2023.

The Company entered into a two-year $ 1,525 million floating-to-fixed interest rate agreement in December 2023.

The two-year interest rate swap met the criteria to be considered as a qualifying cash flow hedge under ASC 815 as of December 2023, and the mark-to-market gains (losses) on the instrument was deferred within Other comprehensive income on the Condensed Consolidated Statements of Comprehensive Income.

Variable Interest Entities

4 unchanged sentences

The Company and its JV partners each pay monthly fees for the use of the microwave communication networks in connection with their respective trading activities, and the JVs may sell excess bandwidth that is not utilized by the JV members to third parties.

As of September 30, 2023, the Company held noncontrolling interests of 12.5 % and 50.0 %, respectively, in these JVs.

As of March 31, 2024, the Company held noncontrolling interests of 12.5 % and 50.0 %, respectively, in these JVs.

The Company has an interest in a JV that offers derivatives trading technology and execution services to broker-dealers, professional traders and select hedge funds.

As of September 30, 2023, the Company held approximately a 9.8 % noncontrolling interest in this JV.

As of March 31, 2024, the Company held approximately a 9.8 % noncontrolling interest in this JV.

The Company has an interest in a JV that operates a member-owned equities exchange with the goal of increasing competition and transparency, while reducing fixed costs and simplifying execution of equity trading in the U.S.

As of September 30, 2023, the Company held approximately a 13.5 % noncontrolling interest in this JV.

As of March 31, 2024, the Company held approximately a 13.5 % noncontrolling interest in this JV.

In the second quarter of 2022, the Company invested in a JV that was formed for the purpose of developing and operating a cryptocurrency trading platform with the goal of increasing competition and transparency, while improving trading performance and reducing operational risk.

As of September 30, 2023, the Company held approximately a 9.3 % noncontrolling interest in this JV.

As of March 31, 2024, the Company held approximately a 6.9 % noncontrolling interest in this JV.

The Company's five JVs noted above meet the criteria to be considered VIEs, which it does not consolidate.

The Company records its interest in each JV under the equity method of accounting and records its investment in the JVs within Other assets and its amounts payable for communication services provided by the applicable JVs within Accounts payable, accrued expenses and other liabilities on the Statements of Financial Condition.

The Company records its pro-rata share of each JV's earnings or losses within Other, net and fees related to the use of communication services provided by the JVs within Communications and data processing on the Condensed Consolidated Statements of Comprehensive Income.

The Company records its pro-rata share of each

JV's earnings or losses within Other, net and fees related to the use of communication services provided by the JVs within Communications and data processing on the Condensed Consolidated Statements of Comprehensive Income.

The Company’s exposure to the obligations of these VIEs is generally limited to its interests in each respective JV, which is the carrying value of the equity investment in each JV.

The following table presents the Company’s nonconsolidated VIEs at September 30, 2023:

The following table presents the Company’s nonconsolidated VIEs at March 31, 2024:

Carrying Amount Maximum Exposure to Loss VIEs' assets

6 unchanged sentences

During the second quarter of 2022, the Company formed a JV to support the growth and expansion of a multi-asset request-for-quote communication platform.

As of September 30, 2023, the Company held a 51 % controlling interest in this entity.

As of March 31, 2024, the Company held a 51 % controlling interest in this entity.

This JV meets the criteria to be considered a VIE, and based on the standard for control set forth above, the Company consolidates this entity and records the interest that the Company does not own as noncontrolling interest in the Condensed Consolidated Financial Statements.

2 unchanged sentences

Disaggregation of Revenues

The following tables present the Company’s revenue from contracts with customers disaggregated by service, and timing of revenue recognition, reconciled to the Company’s segments, for the three and nine months ended September 30, 2023, and 2022:

Three Months Ended September 30, 2023

(in thousands) Market Making Execution Services Corporate Total

Revenues from contracts with customers:

Commissions, net $ 6,343 $ 73,121 $ — $ 79,464

Workflow technology — 21,526 — 21,526

Analytics — 9,286 — 9,286

Total revenue from contracts with customers 6,343 103,933 — 110,276

Other sources of revenue 511,008 8,520 360 519,888

Total revenues $ 517,351 $ 112,453 $ 360 $ 630,164

Timing of revenue recognition:

Services transferred at a point in time $ 517,351 $ 94,152 $ 360 $ 611,863

Services transferred over time — 18,301 — 18,301

Total revenues $ 517,351 $ 112,453 $ 360 $ 630,164

Three Months Ended September 30, 2022

(in thousands) Market Making Execution Services Corporate Total

Revenues from contracts with customers:

Commissions, net $ 10,687 $ 78,506 $ — $ 89,193

Workflow technology — 21,968 — 21,968

Analytics — 9,825 — 9,825

Total revenue from contracts with customers 10,687 110,299 — 120,986

Other sources of revenue 437,199 9,300 ( 6,441 ) 440,058

Total revenues $ 447,886 $ 119,599 $ ( 6,441 ) $ 561,044

Timing of revenue recognition:

Services transferred at a point in time $ 447,886 $ 101,621 $ ( 6,441 ) $ 543,066

Services transferred over time — 17,978 — 17,978

Total revenues $ 447,886 $ 119,599 $ ( 6,441 ) $ 561,044

Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024

(in thousands) Market Making Execution Services Corporate Total

10 unchanged sentences

Total revenues $ 521,008 $ 117,788 $ 4,043 $ 642,839

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

(in thousands) Market Making Execution Services Corporate Total

11 unchanged sentences

Remaining Performance Obligations and Revenue Recognized from Past Performance Obligations

As of September 30, 2023 and 2022, the aggregate amount of the transaction price allocated to the performance obligations relating to workflow technology and analytics revenues that are unsatisfied (or partially unsatisfied) was not material.

As of March 31, 2024 and 2023, the aggregate amount of the transaction price allocated to the performance obligations relating to workflow technology and analytics revenues that are unsatisfied (or partially unsatisfied) was not material.

Contract Assets and Contract Liabilities

2 unchanged sentences

The Company records a contract liability when payment is received prior to the time at which the satisfaction of the service obligation occurs.

Receivables related to revenues from contracts with customers amounted to $ 52.7 million and $ 56.1 million as of September 30, 2023 and December 31, 2022, respectively.

Receivables related to revenues from contracts with customers amounted to $ 57.6 million and $ 56.4 million as of March 31, 2024 and December 31, 2023, respectively.

The Company did not identify any contract assets.

There were no impairment losses on receivables as of September 30, 2023.

There were no impairment losses on receivables as of March 31, 2024.

Deferred revenue primarily relates to deferred commissions allocated to analytics products and subscription fees billed in advance of satisfying the performance obligations.

Deferred revenue related to contracts with customers was $ 8.8 million and $ 9.6 million as of September 30, 2023 and December 31, 2022, respectively.

The Company recognized the full amount of revenue during the nine months ended September 30, 2023 and 2022, that had been recorded as deferred revenue in the respective prior year.

Deferred revenue related to contracts with customers was $ 9.5 million and $ 8.4 million as of March 31, 2024 and December 31, 2023, respectively.

The Company recognized the full amount of revenue during the three months ended March 31, 2024 and 2023, that had been recorded as deferred revenue in the respective prior year.

The Company has not identified any costs to obtain or fulfill its contracts under ASC 606.

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taxation as partnerships.

Accordingly, for the three and nine months ended September 30, 2023 and 2022, the income attributable to these noncontrolling interests was reported in the Condensed Consolidated Statements of Comprehensive Income, but the related U.S.

Accordingly, for the three months ended March 31, 2024 and 2023, the income attributable to these noncontrolling interests was reported in the Condensed Consolidated Statements of Comprehensive Income, but the related U.S.

income tax expense attributable to these noncontrolling interests was not reported by the Company as it is the obligation of the individual partners.

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subsidiaries are subject to foreign income taxes in the jurisdictions in which they operate.

The Company’s provisions for income taxes and effective tax rates were $ 20.5 million, and 14.9 %, and $ 21.7 million, and 21.4 % for the three months ended September 30, 2023 and 2022, respectively and $ 51.1 million, and 16.6 %, and $ 88.4 million, and 17.1 % for the nine months ended September 30, 2023 and 2022, respectively.

The Company’s provisions for income taxes and effective tax rates were $ 28.5 million, and 20.4 %, and $ 24.7 million, and 18.3 % for the three months ended March 31, 2024 and 2023, respectively.

Income tax expense is also affected by the differing effective tax rates in foreign, state and local jurisdictions where certain of the Company’s subsidiaries are subject to corporate taxation.

Included in Other assets on the Condensed Consolidated Statements of Financial Condition at September 30, 2023 and December 31, 2022 are current income tax receivables of $ 45.9 million and $ 54.1 million, respectively.

The balances at September 30, 2023 and December 31, 2022 primarily comprised income tax benefits due to the Company from federal, state, local, and foreign tax jurisdictions based on income before taxes.

Included in Accounts payable, accrued expenses and other liabilities on the Condensed Consolidated Statements of Financial Condition at September 30, 2023 and December 31, 2022 are current tax liabilities of $ 7.5 million and $ 13.4 million, respectively.

The balances at September 30, 2023 and December 31, 2022 primarily comprise income taxes owed to federal, state and local, and foreign tax jurisdictions based on income before taxes.

Included in Other assets on the Condensed Consolidated Statements of Financial Condition at March 31, 2024 and December 31, 2023 are current income tax receivables of $ 54.7 million and $ 44.3 million, respectively.

The balances at March 31, 2024 and December 31, 2023 primarily comprised income tax benefits due to the Company from federal, state, local, and foreign tax jurisdictions based on income before taxes.

Included in Accounts payable, accrued expenses and other liabilities on the Condensed Consolidated Statements of Financial Condition at March 31, 2024 and December 31, 2023 are current tax liabilities of $ 10.6 million and $ 6.8 million, respectively.

The balances at March 31, 2024 and December 31, 2023 primarily comprise income taxes owed to federal, state and local, and foreign tax jurisdictions based on income before taxes.

Deferred income taxes arise primarily due to the amortization of the deferred tax assets recognized in connection with the IPO (see Note 4 “Tax Receivable Agreements”), the Acquisition of KCG, and the ITG Acquisition, differences in the valuation of financial assets and liabilities, and other temporary differences arising from the deductibility of compensation, depreciation, and other expenses in different time periods for book and income tax return purposes.

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Accordingly, the need to establish valuation allowances for deferred tax assets is assessed periodically with appropriate consideration given to all positive and negative evidence related to the realization of the deferred tax assets.

At September 30, 2023 and December 31, 2022, the Company did not have any U.S.

federal net operating loss carryforwards and therefore the Company did not record a deferred tax asset related to federal net operating loss carryforwards.

At September 30, 2023 and December 31, 2022, the Company recorded deferred income taxes related to state and local net operating losses of $ 0.4 million.

These net operating losses will begin to expire in 2039.

The Company did not record a valuation allowance against this deferred tax asset.

As a result of the ITG Acquisition, the Company had non-U.S.

net operating losses of $ 65.4 million and $ 64.6 million at September 30, 2023 and December 31, 2022, respectively, and recorded a related deferred tax asset of $ 12.3 million and $ 12.4 million, respectively.

A valuation allowance of $ 12.3 million and $ 12.4 million was recorded against this deferred tax asset at September 30, 2023 and December 31, 2022, respectively as it is more likely than not that a substantial portion of this deferred tax asset will not be realized.

As a result of the Acquisition of KCG, the Company had non-U.S.

net operating losses at September 30, 2023 and December 31, 2022 of $ 239.3 million, and recorded a related deferred tax asset of $ 44.9 million in both years.

A full valuation allowance was also recorded against this deferred tax asset at both September 30, 2023 and December 31, 2022 as it is more likely than not that this deferred tax asset will not be realized.

No valuation allowance against the remaining deferred taxes was recorded as of September 30, 2023 and December 31, 2022 because it is more likely than not that these deferred tax assets will be fully realized.

At March 31, 2024 and December 31, 2023, the Company did not have any U.S.

federal, state or local net operating loss carryforwards and therefore the Company did not record a deferred tax asset related to any federal net operating loss carryforwards.

As a result of the acquisitions of ITG and KCG, the Company has non-U.S.

net operating losses at March 31, 2024 and December 31, 2023, of $ 303.4 million and $ 304.5 million, respectively, and has recorded related deferred tax assets of $ 56.9 million and $ 57.1 million, respectively.

A full valuation allowance was recorded against these deferred tax assets at March 31, 2024 and December 31, 2023 as it is more likely than not that these deferred tax assets will not be realized.

No valuation allowance against the remaining deferred taxes was recorded as of March 31, 2024 and December 31, 2023 because it is more likely than not that these deferred tax assets will be fully realized.

The Company is subject to taxation in U.S.

federal, state, local and foreign jurisdictions.

As of September 30, 2023, the Company’s tax years for 2015 through 2022 and 2016 through 2022 were subject to examination by U.S.

As of March 31, 2024, the Company’s tax years for 2015 through 2022 and 2016 through 2022 were subject to examination by U.S.

tax authorities, respectively.

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Penalties, if any, are recorded in Operations and administrative expense and interest received or paid is recorded in Other, net or Operations and administrative expense in the Condensed Consolidated Statements of Comprehensive Income, respectively.

The Company had $ 7.0 million of unrecognized tax benefits as of September 30, 2023, all of which would affect the Company’s effective tax rate if recognized.

The Company has determined that there are no uncertain tax positions that would have a material impact on the Company’s financial position as of September 30, 2023.

The Company had $ 7.6 million of unrecognized tax benefits as of March 31, 2024, all of which would affect the Company’s effective tax rate if recognized.

The Company has determined that there are no uncertain tax positions that would have a material impact on the Company’s financial position as of March 31, 2024.

Commitments, Contingencies and Guarantees

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In September 2023, the SEC filed an action against the Company alleging violations of federal securities laws with respect to the Company’s information barriers policies and procedures for a specified time period in and around January 2018 to April 2019 and related statements made by the Company during such period.

The Company believes it has meritorious defenses and intends to defend itself vigorously.

Specifically, the Company plans to assert, among other defenses, that it maintained reasonable policies, procedures and controls to protect data during the period consistent with applicable law, that related statements made to clients and investors were true and accurate, and that the statute of limitations has expired with respect to certain claims.

In a matter related to the SEC investigation noted above, on May 19, 2023, the Company and certain of its current and former executive officers were named as defendants in Hiebert v.

The Company believes it has meritorious defenses and is defending itself vigorously.

Specifically, the Company is asserting, among other defenses, that it maintained reasonable policies, procedures and controls to protect data during the period consistent with applicable law, that related statements made to clients and investors were true and accurate, and that the statute of limitations has expired with respect to certain claims.

In matters related to the SEC investigation noted above, the Company and certain of its current and former executive officers were named as defendants on May 19, 2023 in Hiebert v.

Virtu Financial, Inc., No.

The complaint was filed by a purported stockholder in the Eastern District of New York on behalf of a putative class and asserts that the Company made materially false and misleading statements and omissions in its public filings in violation of federal securities laws, and is expected to be amended and restated by the newly appointed lead plaintiff.

The Company also received a request for information pursuant to Section 220 of the Delaware General Corporation Law from counsel for a purported stockholder.

The Company believes it has meritorious defenses against pending or contemplated claims that its public disclosures in relation to the SEC investigation were inadequate or misleading.

23-cv-03770 and on October 31, 2023 in City of Birmingham Retirement and Relief System v.

Virtu Financial, Inc., No.

The complaints were each filed by purported stockholders in the Eastern District of New York on behalf of a putative class and assert that the Company made materially false and misleading statements and omissions in its public filings in violation of federal securities laws.

The complaints were subsequently consolidated and recaptioned in re Virtu Financial, Inc.

Securities Litigation , No.

The Company also has received requests for information related to the SEC investigation pursuant to Section 220 of the Delaware General Corporation Law from counsel for purported stockholders.

The Company believes it has meritorious defenses against pending or contemplated claims that its public disclosures were inadequate or misleading.

The Company maintains that such disclosures were true and accurate and compliant with applicable law and will defend itself vigorously.

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The Company believes it has meritorious defenses against any unwinding of transactions, which it has asserted, and will continue to defend itself vigorously.

On December 1, 2022, the Company’s subsidiary, along with several other parties, was named as a defendant in Northwest Biotherapeutics, Inc.

On December 1, 2022, the Company’s subsidiary, along with several other parties, was named as a defendant in N orthwest Biotherapeutics, Inc.

Canaccord Genuity LLC, et al No.

1:22-cv-10185.

The complaint alleges that defendants engaged in market manipulation in the plaintiff’s stock during a period from 2018 to 2022.

The complaint did not specify the amount of alleged damages.

The initial complaint alleged that defendants engaged in market manipulation in the plaintiff’s stock during a period from 2018 to 2022.

A first amended complaint was filed on April 10, 2023, bringing substantially the same allegations as the initial complaint.

The first amended complaint was dismissed with leave to amend on February 14, 2024.

Plaintiff filed a second amended complaint on March 18, 2024.

Neither the operative complaint nor prior iterations specify the amount of alleged damages.

The Company believes that the claims are without merit and is defending itself vigorously.

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Further, in 2023, the SEC proposed amendments to expand and update Regulation Systems Compliance and Integrity (SCI) and to restrict volume based tiered pricing by equity exchanges in certain cases, approved an amendment to adopt a revised funding model for the Consolidated Audit Trail (CAT), and has indicated that additional rule proposals may be forthcoming.

If adopted, these or other potential rule changes could adversely affect the Company’s business or the Company’s industry.

Additionally, rules to amend the definitions of “dealer” and “government securities dealer” within the Exchange Act were recently adopted, and are expected to broaden the scope of these registrant categories.

These pending or potential rule changes, to the extent adopted, could adversely affect the Company’s business or the Company’s industry.

As indicated above, from time to time, the Company is the subject of requests for information and documents from the SEC, the Financial Industry Regulatory Authority (“FINRA”), state attorneys general, and other regulators and governmental authorities.

It is the Company's practice to cooperate and comply with the requests for information and documents.

Additional information regarding legal and regulatory risks is described within the “Risk Factors” section under the sub header of “Legal and Regulatory Risks” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022, as filed with the Securities and Exchange Commission ("SEC") on February 17, 2023 (the "2022 Form 10-K").

As indicated above, the Company is currently the subject of various regulatory reviews and investigations by state, federal and foreign regulators and SROs, including the SEC and FINRA.

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The Company's maximum exposure under these arrangements is currently unknown, as any such exposure could relate to claims not yet brought or events which have not yet occurred.

For example, in November 2013, KCG sold Urban Financial of America, LLC (“Urban”), the reverse mortgage origination and securitization business previously owned by Knight Capital Group, Inc., to an investor group now known as Finance of America Reverse, LLC (“FAR”).

Pursuant to the terms of the Stock Purchase Agreement between KCG and FAR, Virtu has certain continuing obligations related to KCG's prior ownership of Urban.

Consistent with standard business practices in the normal course of business, the Company enters into contracts that contain a variety of representations and warranties and general indemnifications.

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Lease assets and liabilities are summarized as follows:

(in thousands) Financial Statement Location September 30, 2023 December 31, 2022

(in thousands) Financial Statement Location March 31, 2024 December 31, 2023

Operating leases

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Weighted average remaining lease term and discount rate are as follows:

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Weighted average remaining lease term

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The components of lease expense are as follows:

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in thousands) 2024 2023

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Total Finance lease cost $ 2,991 $ 2,332

Future minimum lease payments under operating and finance leases with non-cancelable lease terms, as of September 30, 2023, are as follows:

Future minimum lease payments under operating and finance leases with non-cancelable lease terms, as of March 31, 2024, are as follows:

(in thousands) Operating Leases Finance Leases

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as reported within the Condensed Consolidated Statements of Financial Condition to the sum of the same such amounts shown in the Condensed Consolidated Statements of Cash Flows.

(in thousands) September 30, 2023 December 31, 2022

(in thousands) March 31, 2024 December 31, 2023

Cash and cash equivalents $ 399,585 $ 820,436

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The Founder Member controls approximately 86.5 % of the combined voting power of our common stock as a result of its ownership of our Class A, Class C and Class D Common Stock.

The Company holds approximately a 58.4 % interest in Virtu Financial at September 30, 2023.

The Company holds approximately a 57.8 % interest in Virtu Financial at March 31, 2024.

During the period prior to the Company's IPO and certain reorganization transactions consummated in connection with the IPO, Class A-2 profits interests and Class B interests in Virtu Financial were issued to Employee Holdco (as defined below) on behalf of certain key employees and stakeholders.

In connection with these reorganization transactions, all Class A-2 profits interests and Class B interests were reclassified into Virtu Financial Units.

As of September 30, 2023 and December 31, 2022, there were 4,040,772 and 4,462,840 Virtu Financial Units outstanding held by Employee Holdco (as defined below), respectively, and 422,068 and 328,999 of such Virtu Financial Units and corresponding Class C Common Stock were exchanged into Class A Common Stock, forfeited or repurchased during the nine months ended September 30, 2023, and 2022, respectively.

In connection with these reorganization transactions, all Class A-2 profits

interests and Class B interests were reclassified into Virtu Financial Units.

As of March 31, 2024 and December 31, 2023, there were 4,040,772 and 4,040,772 Virtu Financial Units outstanding held by Employee Holdco (as defined below), respectively, and none and 173,535 of such Virtu Financial Units and corresponding Class C Common Stock were exchanged into Class A Common Stock, forfeited or repurchased during the three months ended March 31, 2024 and 2023, respectively.

Amended and Restated 2015 Management Incentive Plan

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As a result of the RSU Amendment, currently issued and outstanding RSUs held by the Company's employees, including its executive officers, shall be deemed to be subject to the amended terms of the form award agreement, and any future RSU awards shall also be governed by such amended terms.

Amended and Restated Investment Technology Group, Inc.

2007 Omnibus Equity Compensation Plan

On the ITG Closing Date, the Company assumed the Amended and Restated ITG 2007 Equity Plan and the Assumed Awards.

As of the ITG Closing Date, the aggregate number of shares of Class A Common Stock subject to such Assumed Awards was 2,497,028 and the aggregate number of shares of Class A Common Stock that remained issuable pursuant to the Amended and Restated ITG 2007 Equity Plan was 1,230,406 .

Share Repurchase Program

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The timing and amount of repurchase transactions are determined by the Company's management based on its evaluation of market conditions, share price, cash sources, legal requirements and other factors.

From the inception of the program through September 30, 2023, the Company repurchased approximately 41.2 million shares of Class A Common Stock and Virtu Financial Units for approximately $ 1,065.6 million.

As of September 30, 2023, the Company has approximately $ 154.4 million remaining capacity for future purchases of shares of Class A Common Stock and Virtu Financial Units under the program.

From the inception of the program through March 31, 2024, the Company repurchased approximately 45.6 million shares of Class A Common Stock and Virtu Financial Units for approximately $ 1,145.4 million.

As of March 31, 2024, the Company has approximately $ 74.6 million remaining capacity for future purchases of shares of Class A Common Stock and Virtu Financial Units under the program.

Employee Exchanges

During the nine months ended September 30, 2023, and 2022, pursuant to the exchange agreement by and among the Company, Virtu Financial and holders of Virtu Financial Units, certain current and former employees elected to exchange 186,394 , and 92,930 units, respectively in Virtu Financial held directly or on their behalf by Virtu Employee Holdco LLC (“Employee Holdco”) on a one -for-one basis for shares of Class A Common Stock.

Warrant Issuance

On March 20, 2020, in connection with and in consideration of the Founder Member’s commitments under the Founder Member Loan Facility (as described in Note 8 "Borrowings"), the Company delivered to the Founder Member a warrant (the “Warrant”) to purchase shares of the Company’s Class A Common Stock.

Pursuant to the Warrant, the Founder Member was entitled to purchase up to 3,000,000 shares of Class A Common Stock on or after May 22, 2020 up to and including January 15, 2022.

The Founder Member Loan Facility Term expired on September 20, 2020 without the Company having borrowed any Founder Member Loans thereunder (as described in Note 8 "Borrowings").

The exercise price per share of the Class A Common Stock issuable pursuant to the Warrant was $ 22.98 , which in accordance with the terms of the Warrant, is equal to the average of the volume weighted average prices of the Class A Common Stock for the ten ( 10 ) trading days following May 7, 2020, the date on which the Company publicly announced its earnings results for the first quarter of 2020.

On December 17, 2021, the Founder Member exercised in full the Warrant to purchase 3,000,000 shares of the Company's Class A Common Stock.

The Warrant and Class A Common Stock issued pursuant to the Warrant were offered, issued and sold, in reliance on the exemption from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), set forth under Section 4(a)(2) of the Securities Act relating to sales by an issuer not involving any public offering.

Upon issuance, the fair value of the Warrant was determined using a Black-Scholes-Merton model, and was recorded as a debt issuance cost within Other assets on the Condensed Consolidated Statements of Financial Condition and as an increase

to Additional paid-in capital on the Condensed Consolidated Statements of Changes in Equity.

The balance was amortized on a straight-line basis from March 20, 2020 through September 20, 2020, the date on which the Founder Member Loan Facility expired, and recorded as expense within Debt issue cost related to debt refinancing, prepayment and commitment fees in the Condensed Consolidated Statements of Comprehensive Income.

During the three months ended March 31, 2024 and 2023, pursuant to the exchange agreement by and among the Company, Virtu Financial and holders of Virtu Financial Units, certain current and former employees elected to exchange none and 152,037 units, respectively in Virtu Financial held directly or on their behalf by Virtu Employee Holdco LLC (“Employee Holdco”) on a one -for-one basis for shares of Class A Common Stock.

Accumulated Other Comprehensive Income

The following table presents the changes in Other Comprehensive Income for the three and nine months ended September 30, 2023, and 2022:

Three Months Ended September 30, 2023

(in thousands) AOCI Beginning Balance Amounts recorded

in AOCI Amounts reclassified from AOCI to income AOCI Ending Balance

Net change in unrealized cash flow hedges gains (losses) (1) $ 41,970 $ 3,733 $ ( 8,199 ) $ 37,504

Foreign exchange translation adjustment ( 10,838 ) ( 2,339 ) — ( 13,177 )

Total $ 31,132 $ 1,394 $ ( 8,199 ) $ 24,327

(1) Amounts reclassified from AOCI to income are included within Financing interest expense on long-term borrowings on the Condensed Consolidated Statements of Comprehensive Income.

As of September 30, 2023, the Company expects approximately $ 32.8 million to be reclassified from AOCI into earnings over the next 12 months.

The timing of the reclassification is based on the interest payment schedule of the long-term borrowings.

Three Months Ended September 30, 2022

(in thousands) AOCI Beginning Balance Amounts recorded

in AOCI Amounts reclassified from AOCI to income AOCI Ending Balance

Net change in unrealized cash flow hedges gains (losses) (1) $ 27,486 $ 19,579 $ ( 1,066 ) $ 45,999

Foreign exchange translation adjustment ( 13,660 ) ( 11,161 ) — ( 24,821 )

Total $ 13,826 $ 8,418 $ ( 1,066 ) $ 21,178

(1) Amounts reclassified from AOCI to income are included within Financing interest expense on long-term borrowings on the Consolidated Statements of Comprehensive Income.

Nine Months Ended September 30, 2023

The following table presents the changes in Other Comprehensive Income for the three months ended March 31, 2024 and 2023:

Three Months Ended March 31, 2024

(in thousands) AOCI Beginning Balance Amounts recorded

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(1) Amounts reclassified from AOCI to income are included within Financing interest expense on long-term borrowings on the Consolidated Statements of Comprehensive Income.

As of September 30, 2023, the Company expects approximately $ 32.8 million to be reclassified from AOCI into earnings over the next 12 months.

As of March 31, 2024, the Company expects approximately $ 28.4 million to be reclassified from AOCI into earnings over the next 12 months.

The timing of the reclassification is based on the interest payment schedule of the long-term borrowings.

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

(in thousands) AOCI Beginning Balance Amounts recorded

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Pursuant to the Amended and Restated 2015 Management Incentive Plan as described in Note 17 “Capital Structure”, and in connection with the IPO, non-qualified stock options to purchase shares of Class A Common Stock were granted, each of which vests in equal annual installments over a period of four years from grant date and expires not later than 10 years from the date of grant.

The following table summarizes activity related to stock options for the nine months ended September 30, 2023 and 2022:

The following table summarizes activity related to stock options for the three months ended March 31, 2024 and 2023:

Options Outstanding Options Exercisable

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Forfeited or expired — — — — —

At September 30, 2022 1,521,776 $ 19.00 2.49 1,521,776 $ 19.00

At March 31, 2023 1,521,776 $ 19.00 1.99 1,521,776 $ 19.00

At December 31, 2023 1,511,776 $ 19.00 1.24 1,511,776 $ 19.00

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Forfeited or expired — — — — —

At September 30, 2023 1,511,776 $ 19.00 1.49 1,511,776 $ 19.00

At March 31, 2024 1,511,776 $ 19.00 1.00 1,511,776 $ 19.00

The expected life was determined based on an average of vesting and contractual period.

3 unchanged sentences

The expected dividend yield was determined based on estimated future dividend payments divided by the IPO stock price.

Amended and Restated Investment Technology Group, Inc.

2007 Omnibus Equity Compensation Plan

On the ITG Closing Date, the Company assumed the Amended and Restated ITG 2007 Equity Plan and certain stock option awards, restricted stock unit awards, deferred stock unit awards and performance stock unit awards granted thereunder (" the Assumed Awards").

The Assumed Awards are subject to the same terms and conditions that were applicable to them under the Amended and Restated ITG 2007 Equity Plan, except that (i) the Assumed Awards relate to shares of the Company’s Class A Common Stock, (ii) the number of shares of Class A Common Stock subject to the Assumed Awards was the result of an adjustment based upon an Exchange Ratio (as defined in the ITG Merger Agreement) and (iii) the performance share unit awards were converted into service-based vesting restricted stock unit awards that were no longer subject to any performance based vesting conditions.

Class A Common Stock, Restricted Stock Units and Restricted Stock Awards

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Performance targets are based on the Company's adjusted EBITDA for certain future periods.

For the nine months ended September 30, 2023 and 2022, respectively, there were 868,315 , and 580,710 shares of immediately vested Class A Common Stock granted as part of year-end compensation.

In addition, the Company accrued compensation expense of $ 5.9 million and $ 8.9 million for the three months ended September 30, 2023 and 2022, respectively, and $ 17.9 million, and $ 24.4 million for the nine months ended September 30, 2023 and 2022, respectively, related to immediately vested Class A Common Stock expected to be awarded as part of year-end incentive compensation, which was included in Employee compensation and payroll taxes on the Condensed Consolidated Statements of Comprehensive Income and Accounts payable, accrued expenses and other liabilities on the Condensed Consolidated Statements of Financial Condition.

The following table summarizes activity related to RSUs (including the Assumed Awards) and RSAs for the nine months ended September 30, 2023, and 2022:

For the three months ended March 31, 2024 and 2023, respectively, there were 878,091 and 868,315 shares of immediately vested Class A Common Stock granted as part of year-end compensation.

In addition, the Company accrued compensation expense of $ 4.9 million and $ 5.9 million for the three months ended March 31, 2024 and 2023, respectively, related to immediately vested Class A Common Stock expected to be awarded as part of year-end incentive compensation, which was included in Employee compensation and payroll taxes on the Condensed Consolidated Statements of Comprehensive Income and Accounts payable, accrued expenses and other liabilities on the Condensed Consolidated Statements of Financial Condition.

The following table summarizes activity related to RSUs (including the Assumed Awards) and RSAs for the three months ended March 31, 2024 and 2023:

Number of RSUs and RSAs Weighted

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Vested ( 2,393,550 ) 21.60

At September 30, 2022 4,086,929 $ 27.94

At March 31, 2023 4,930,490 $ 25.18

At December 31, 2023 4,903,174 $ 23.90

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Vested ( 2,596,226 ) 19.79

At September 30, 2023 4,975,336 $ 23.81

(1) Excluded in the number of RSUs and RSAs are 37,500 participating RSAs where the grant date has not been achieved because the performance conditions have not been met.

The Company recognized $ 9.7 million and $ 9.2 million for the three months ended September 30, 2023 and 2022, respectively, and $ 29.8 million, and $ 27.3 million for the nine months ended September 30, 2023 and 2022, respectively, of compensation expense in relation to RSUs.

As of September 30, 2023 and December 31, 2022, total unrecognized share-based compensation expense related to unvested RSUs was $ 67.2 million and $ 54.6 million, respectively, and this amount is to be recognized over a weighted average period of 1.1 and 0.9 years, respectively.

At March 31, 2024 4,731,351 $ 22.51

(1) Excluded in the number of RSUs and RSAs are 487,500 and 37,500 participating RSAs for March 31, 2024 and 2023, respectively, where the grant date has not been achieved because the performance conditions have not been met.

The Company recognized $ 10.2 million and $ 10.1 million for the three months ended March 31, 2024 and 2023, respectively, of compensation expense in relation to RSUs.

As of March 31, 2024 and December 31, 2023, total unrecognized share-based compensation expense related to unvested RSUs was $ 67.0 million and $ 55.2 million, respectively, and this amount is to be recognized over a weighted average period of 1.4 years and 0.9 years, respectively.

Awards in which the specific performance conditions have not been met are not included in unrecognized share-based compensation expense.

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broker-dealer in June 2023.

Pursuant to New York Stock Exchange ("NYSE") rules, VAL was also required to maintain $ 1.0 million of capital in connection with the operation of its designated market maker (“DMM”) business as of September 30, 2023.

Pursuant to New York Stock Exchange (“NYSE”) rules, VAL was also required to maintain $ 1.0 million of capital in connection with the operation of its designated market maker (“DMM”) business as of March 31, 2024.

The required amount is determined under the exchange rules as the greater of (i) $ 1.0 million or (ii) $ 75,000 for every 0.1 % of NYSE transaction dollar volume in each of the securities for which the Company is registered as the DMM.

The regulatory capital and regulatory capital requirements of the Company's U.S.

subsidiaries as of September 30, 2023 was as follows:

subsidiaries as of March 31, 2024 was as follows:

(in thousands) Regulatory Capital Regulatory Capital Requirement Excess Regulatory Capital

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RFQ-Hub Americas LLC 1,235 19 1,216

As of September 30, 2023, VAL had $ 31.3 million of cash in special reserve bank accounts for the benefit of customers pursuant to SEC Rule 15c3-3, Computation for Determination of Reserve Requirements, and $ 6.0 million of cash in reserve bank accounts for the benefit of proprietary accounts of brokers.

As of March 31, 2024, VAL had $ 23.4 million of cash in special reserve bank accounts for the benefit of customers pursuant to SEC Rule 15c3-3, Computation for Determination of Reserve Requirements, and $ 6.2 million of cash in reserve bank accounts for the benefit of proprietary accounts of brokers.

The balances are included within Cash restricted or segregated under regulations and other on the Condensed Consolidated Statements of Financial Condition.

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Virtu Americas LLC $ 412,626 $ 1,000 $ 411,626

RFQ-Hub Americas LLC 1,425 15 1,410

As of December 31, 2023, VAL had $ 28.7 million of cash in special reserve bank accounts for the benefit of customers pursuant to SEC Rule 15c3-3, Computation for Determination of Reserve Requirements, and $ 6.1 million of cash in reserve bank accounts for the benefit of proprietary accounts of brokers.

1 unchanged sentence

The Company’s foreign subsidiaries are subject to regulatory capital requirements set by local regulatory bodies, including the Canadian Investment Regulatory Organization (“CIRO”), the Central Bank of Ireland (“CBI”), the Financial Conduct Authority (“FCA”) in the United Kingdom, the Australian Securities and Investments Commission (“ASIC”), the Securities and Futures Commission in Hong Kong (“SFC”), and the Monetary Authority of Singapore (“MAS”).

The regulatory net capital balances and regulatory capital requirements applicable to the Company's foreign subsidiaries as of September 30, 2023 were as follows:

The regulatory net capital balances and regulatory capital requirements applicable to the Company's foreign subsidiaries as of March 31, 2024 were as follows:

(in thousands) Regulatory Capital Regulatory Capital Requirement Excess Regulatory Capital

11 unchanged sentences

(1) Preliminary

As of September 30, 2023, Virtu Europe Trading Limited had $ 0.1 million of segregated funds on deposit for trade clearing and settlement activity, and Virtu ITG Hong Kong Ltd.

As of March 31, 2024, Virtu Europe Trading Limited had $ 40 thousand of segregated funds on deposit for trade clearing and settlement activity, and Virtu ITG Hong Kong Ltd.

had $ 30 thousand of segregated balances under a collateral account control agreement for the benefit of certain customers.

12 unchanged sentences

126,022 73,407 52,615

As of December 31, 2022, Virtu Europe Trading Limited and Virtu Canada Corp had $ 0.1 million and $ 0.4 million, respectively, of funds on deposit for trade clearing and settlement activity, and Virtu ITG Hong Kong Ltd had $ 30 thousand of segregated balances under a collateral account control agreement for the benefit of certain customers.

As of December 31, 2023, Virtu Europe Trading Limited had $ 36 thousand of segregated funds on deposit for trade clearing and settlement activity, and Virtu ITG Hong Kong Ltd had $ 30 thousand of segregated balances under a collateral account control agreement for the benefit of certain customers.

Geographic Information and Business Segments

The Company operates its business in the U.S.

and internationally, primarily in Europe, Asia and Canada.

and internationally, primarily in Europe and Asia.

Significant transactions and balances between geographic regions occur primarily as a result of certain of the Company’s subsidiaries incurring operating expenses such as employee compensation, communications and data processing and other overhead costs, for the purpose of providing execution, clearing and other support services to affiliates.

2 unchanged sentences

The revenues are attributed to countries based on the locations of the subsidiaries.

The following table presents total revenues by geographic area for the three and nine months ended September 30, 2023, and 2022 :

Three Months Ended September 30, Nine Months Ended September 30,

The following table presents total revenues by geographic area for the three months ended March 31, 2024 and 2023 :

Three months ended March 31,

(in thousands) 2024 2023

1 unchanged sentence

Ireland 63,018 53,959

Singapore 22,950 28,901 77,247 106,221

Canada 8,785 12,551 25,283 51,262

Australia 8,049 6,324 21,904 22,592

Others 57,752 43,792

11 unchanged sentences

in addition, the Company will commit capital on behalf of clients as needed.

Client-based, execution-only trading in the segment is done primarily through a variety of access points including:

Client-based, execution-only trading in the segment

is done primarily through a variety of access points including:

(i) algorithmic trading and order routing in global equities and options;

6 unchanged sentences

Segment assets and liabilities are not used for evaluating segment performance or in deciding how to allocate resources to segments.

The Company’s total revenues and income before income taxes and noncontrolling interest (“Pre-tax earnings”) by segment for the three months ended September 30, 2023, and 2022 are summarized in the following table:

(in thousands) Market

Making Execution

Services Corporate Consolidated

Total revenue $ 517,351 $ 112,453 $ 360 $ 630,164

Income before income taxes and noncontrolling interest 130,252 7,814 39 138,105

Total revenue 447,886 119,599 ( 6,441 ) 561,044

Income (loss) before income taxes and noncontrolling interest 99,276 8,993 ( 6,663 ) 101,606

The Company's Pre-tax earnings by segment for the nine months ended September 30, 2023, and 2022 are summarized in the following table:

The Company’s total revenues and income before income taxes and noncontrolling interest (“Pre-tax earnings”) by segment for the three months ended March 31, 2024 and 2023 are summarized in the following table:

(in thousands) Market Making Execution Services Corporate Consolidated Total

Total revenue $ 521,008 $ 117,788 $ 4,043 $ 642,839

Income before income taxes and noncontrolling interest 298,104 16,711 ( 6,478 ) 308,337

Income (loss) before income taxes and noncontrolling interest

126,953 9,243 3,624 139,820

Total revenue $ 498,921 $ 118,478 $ 2,981 $ 620,380

Income before income taxes and noncontrolling interest 448,943 32,005 36,155 517,103

Income (loss) before income taxes and noncontrolling interest

124,109 9,015 1,641 134,765

Related Party Transactions

The Company incurs expenses and maintains balances with its affiliates in the ordinary course of business.

As of September 30, 2023, and December 31, 2022 the Company had net payables to its affiliates of $ 3.0 million and receivables from its affiliates of $ 0.5 million, respectively.

As of March 31, 2024 and December 31, 2023 the Company had net payables to its affiliates of $ 1.8 million and payables to its affiliates of $ 1.5 million, respectively.

The Company has held a minority interest in JNX since 2016 (see Note 9 “Financial Assets and Liabilities”).

The Company pays exchange fees to JNX for the trading activities conducted on its proprietary trading system.

The Company paid $ 2.4 million and $ 3.2 million for the three months ended September 30, 2023 and 2022, respectively, and $ 8.4 million and $ 10.7 million for the nine months ended September 30, 2023 and 2022, respectively, to JNX for these trading activities.

The Company paid $ 2.2 million and $ 2.5 million for the three months ended March 31, 2024 and 2023, respectively, to JNX for these trading activities.

The Company pays monthly use fees to two JVs in which it holds interests (see Note 11 “Variable Interest Entities”).

These monthly fees are for the use of microwave communication networks operated by each of these JVs and are recorded within Communications and data processing on the Condensed Consolidated Statements of Comprehensive Income.

The Company made payments to these JVs of $ 12.6 million and $ 10.5 million for the three months ended September 30, 2023 and 2022, respectively, and $ 25.2 million and $ 21.4 million for the nine months ended September 30, 2023 and 2022, respectively.

The Company made payments to these JVs of $ 7.4 million and $ 6.3 million for the three months ended March 31, 2024 and 2023, respectively.

The Company has an interest in Members Exchange, a member-owned equities exchange.

The Company pays regulatory and transaction fees and receives rebates from trading activities.

The Company made payments of $ 2.2 million and received rebates of $ 2.3 million for the three months ended September 30, 2023 and 2022, respectively, and the Company made payments of $ 2.4 million and received rebates of $ 15.1 million for the nine months ended September 30, 2023 and 2022, respectively.

In the second quarter of 2022, the Company formed a JV to support the growth and expansion of a multi-asset request-for-quote communication platform.

The Company consolidates this JV, and recorded noncontrolling interest of $ 39.2 million in the condensed consolidated statement of changes in equity as of September 30, 2022.

Refer to Note 11 "Variable Interest Entities" for further details.

The Company made payments of $ 1.5 million and $ 0.1 million for the three months ended March 31, 2024 and 2023, respectively.

Subsequent Events

The Company has evaluated subsequent events for adjustment to or disclosure in its Condensed Consolidated Financial Statements through the date of this report, and has not identified any recordable or disclosable events, not otherwise reported in these Condensed Consolidated Financial Statements or the notes thereto, except for the following:

On November 2, 2023, the Company’s Board of Directors declared a dividend of $ 0.24 per share of Class A Common Stock and Class B Common Stock and per participating Restricted Stock Unit and Restricted Stock Award that will be paid on December 15, 2023 to holders of record as of December 1, 2023, and extended the duration of the Company's share repurchase program through December 31, 2024.

On April 19, 2024, the Company entered into an agreement to sell a 49 % interest in the multi-asset request-for-quote communication platform JV previously formed in 2022 and referenced in Note 11 “Variable Interest Entities”.

The sale is subject to various closing conditions including the receipt of certain regulatory approvals.

Upon the closing of the sale, the Company will retain a minority stake in the JV.

On April 24, 2024, the Company’s Board of Directors declared a dividend of $ 0.24 per share of Class A Common Stock and Class B Common Stock and per participating Restricted Stock Unit and Restricted Stock Award that will be paid on June 15, 2024 to holders of record as of June 1, 2024.

On April 24, 2024, the Company’s Board of Directors authorized the expansion of the Company’s current share repurchase program, increasing the total authorized amount by $ 500 million to $ 1,720 million and extended the duration through April 24, 2026.

Since the inception of the program through April 19, 2024, the Company repurchased approximately 45.9 million shares of Class A Common Stock and Virtu Financial Units for approximately $ 1,151.4 million.

Including the additional $ 500 million authorization by its Board, the Company has approximately $ 568.6 million remaining capacity for future purchase of shares of Class A Common Stock and Virtu Financial Units under the program.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements