Core Viewpoint - Newmark Group, Inc. is repurchasing shares from Howard W. Lutnick, complying with U.S. government ethics rules, which will divest his ownership and economic interests in the company [1][4]. Group 1: Share Repurchase Details - Newmark has agreed to repurchase 10,969,523 shares of Class A common stock from Howard W. Lutnick for an aggregate purchase price of $127,027,077, at a price of $11.58 per share [2]. - Following this transaction, Newmark will have $244.9 million remaining under its existing stock repurchase authorization [2]. Group 2: Financial Implications - Newmark's CFO, Michael Rispoli, indicated that this transaction allows the company to acquire a substantial number of shares at a favorable price, supporting the company's expected strong cash generation and future investments in growth [3]. - For the twelve months ending March 31, 2025, Newmark generated revenues exceeding $2.8 billion [6]. Group 3: Ownership and Governance Changes - Mr. Lutnick has agreed to transfer his ownership in Cantor Fitzgerald to trusts for the benefit of his children, with the closing of these transactions expected in the third quarter of 2025 [3]. - The sale of shares will comply with Mr. Lutnick's U.S. government ethics agreement, effectively divesting his ownership, voting, and economic interests in Newmark [4].

Core Insights - Newmark facilitated the largest new office lease in Silicon Valley since 2023, representing Zscaler in a 301,163-square-foot sublease for its new global headquarters [1][2][3] - The new headquarters, located at 4301 and 4401 Great America Parkway in Santa Clara, California, is set to open in summer 2026 and aims to support Zscaler's rapid growth in the zero trust cybersecurity sector [1][2][3] Company Overview - Zscaler is a leader in zero trust cybersecurity, providing AI-powered solutions to protect enterprises [1] - The new facility will enhance Zscaler's innovative environment and accommodate its expanding workforce, reflecting the company's commitment to collaboration and community impact [2][3] Newmark's Role - Newmark's Vice Chairman Mike Saign and Senior Managing Director Rich Hoyt led the team that advised Zscaler on this significant transaction [2] - Newmark Group, Inc. reported revenues exceeding $2.8 billion for the twelve months ending March 31, 2025, and operates approximately 165 offices globally with around 8,100 professionals [4]

[FORM 10-Q](index=1&type=section&id=FORM%2010-Q) [Glossary of Terms, Abbreviations, and Acronyms](index=3&type=section&id=Glossary%20of%20Terms,%20Abbreviations,%20and%20Acronyms) [Where You Can Find More Information](index=13&type=section&id=WHERE%20YOU%20CAN%20FIND%20MORE%20INFORMATION) [Special Note Regarding Forward-Looking Information](index=14&type=section&id=SPECIAL%20NOTE%20REGARDING%20FORWARD-LOOKING%20INFORMATION) This section notes forward-looking statements are subject to risks and uncertainties that may cause actual results to differ - The report contains forward-looking statements based on current expectations, which involve risks and uncertainties that could cause actual results to differ significantly[26](index=26&type=chunk) - Key risk factors include macroeconomic challenges (e.g., conflicts, interest rates, inflation), commercial real estate market changes (e.g., demand shifts, declining values), capital market volatility, competition, integration of acquisitions, and regulatory changes[27](index=27&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk) [PART I - FINANCIAL INFORMATION](index=18&type=section&id=PART%20I%20-%20FINANCIAL%20INFORMATION) [ITEM 1. FINANCIAL STATEMENTS (unaudited)](index=18&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS%20(unaudited)) This section presents Newmark Group, Inc.'s unaudited condensed consolidated financial statements for the period ended March 31, 2025, including balance sheets, statements of operations, comprehensive income, changes in equity, and cash flows, along with detailed explanatory notes [Condensed Consolidated Balance Sheets](index=18&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the company's assets, liabilities, and equity as of March 31, 2025, and December 31, 2024 Condensed Consolidated Balance Sheet Highlights | Metric | March 31, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----- | :----------------------------- | :------------------------------- | | Total Assets | $4,847,743 | $4,710,120 | | Total Liabilities | $3,287,816 | $3,172,051 | | Total Equity | $1,546,991 | $1,524,169 | [Condensed Consolidated Statements of Operations](index=19&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's revenues, expenses, and net income for the three months ended March 31, 2025, and 2024 Condensed Consolidated Statements of Operations Highlights | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | Change (YoY) | | :----- | :----------------------------------------------- | :----------------------------------------------- | :----------- | | Total Revenues | $665,494 | $546,499 | +21.8% | | Total Operating Expenses | $683,763 | $569,097 | +20.1% | | Income (loss) from operations | $(17,519) | $(22,612) | +22.5% | | Consolidated net income (loss) | $(15,949) | $(26,316) | +39.4% | | Net income (loss) available to common stockholders | $(8,766) | $(16,254) | +46.1% | | Basic earnings per share | $(0.05) | $(0.09) | +44.4% | [Condensed Consolidated Statements of Comprehensive Income](index=20&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) This section presents comprehensive income, including net income and other items, for the periods presented Condensed Consolidated Statements of Comprehensive Income Highlights | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :----- | :----------------------------------------------- | :----------------------------------------------- | | Consolidated net income (loss) | $(15,949) | $(26,316) | | Foreign currency translation adjustments | $5,927 | $(2,911) | | Comprehensive income (loss), net of tax | $(10,022) | $(29,227) | [Condensed Consolidated Statements of Changes in Equity](index=21&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) This section details changes in total equity, including stockholders' equity and noncontrolling interests Condensed Consolidated Statements of Changes in Equity Highlights | Metric | March 31, 2025 (in thousands) | January 1, 2025 (in thousands) | | :----- | :----------------------------- | :----------------------------- | | Total Stockholders' Equity | $1,321,327 | $1,205,525 | | Noncontrolling Interests | $225,664 | $318,644 | | Total Equity | $1,546,991 | $1,524,169 | - Dividends declared and paid per share of common stock remained constant at **$0.03** for both periods[38](index=38&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=22&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section outlines cash flows from operating, investing, and financing activities for the periods presented Condensed Consolidated Statements of Cash Flows Highlights | Metric | Three Months Ended March 31, 2025 (in thousands) | Three Months Ended March 31, 2024 (in thousands) | | :----- | :----------------------------------------------- | :----------------------------------------------- | | Net cash used in operating activities | $(179,404) | $(68,783) | | Net cash used in investing activities | $(5,444) | $(7,354) | | Net cash provided by financing activities | $147,625 | $56,140 | | Net increase (decrease) in cash and cash equivalents and restricted cash | $(37,223) | $(19,997) | | Cash and cash equivalents and restricted cash at end of period | $267,642 | $238,709 | [Notes to Condensed Consolidated Financial Statements](index=23&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed explanations and disclosures for the figures presented in the condensed consolidated financial statements, covering organization, accounting policies, equity, debt, and various other financial instruments and commitments [(1) Organization and Basis of Presentation](index=23&type=section&id=(1)%20Organization%20and%20Basis%20of%20Presentation) This note describes Newmark's commercial real estate business and the basis of financial statement presentation - Newmark is a leading commercial real estate advisor and service provider, offering diverse integrated services including capital markets, leasing, valuation, property management, and flexible workspace solutions[43](index=43&type=chunk) - The financial statements are prepared in conformity with U.S. GAAP, with certain reclassifications made for current presentation[44](index=44&type=chunk) - Newmark receives administrative services from Cantor, with allocated expenses included as "Fees to related parties," which management believes reasonably reflect service utilization[46](index=46&type=chunk)[48](index=48&type=chunk) [(2) Limited Partnership Interests in Newmark Holdings and BGC Holdings](index=25&type=section&id=(2)%20Limited%20Partnership%20Interests%20in%20Newmark%20Holdings%20and%20BGC%20Holdings) This note details limited partnership interests in Newmark Holdings and BGC Holdings, covering exchangeability and income allocations - Newmark Holdings limited partnership interests were distributed to BGC Holdings holders, with an Exchange Ratio of **0.9271** as of March 31, 2025, impacting exchangeability into Class A common stock[62](index=62&type=chunk)[74](index=74&type=chunk) - Founding/Working Partners Units (FPUs) and other limited partnership units (LPUs) generally receive quarterly net income allocations, recognized as compensation expense, contingent on services provided by unit holders[66](index=66&type=chunk)[69](index=69&type=chunk) - Cantor holds limited partnership interests (Cantor Units) reflected as noncontrolling interests, receiving quarterly net income (loss) allocations[73](index=73&type=chunk) [(3) Summary of Significant Accounting Policies](index=28&type=section&id=(3)%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines Newmark's key accounting policies, including revenue recognition for various service lines and segment reporting - Revenue from management services, servicing fees, and other is recognized as services are performed or on an accrual basis for servicing fees[78](index=78&type=chunk)[81](index=81&type=chunk) - Leasing commissions are recognized at lease signing, while capital markets revenue (investment sales, mortgage origination) is recognized upon service provision, closing of sale, or commitment to originate/sell loans[82](index=82&type=chunk)[84](index=84&type=chunk)[85](index=85&type=chunk) - Newmark operates as one reportable segment (real estate services) and reported total revenues of **$665.5 million** for Q1 2025, with the U.S. contributing the majority (**$575.0 million**)[95](index=95&type=chunk)[96](index=96&type=chunk)[99](index=99&type=chunk) [(4) Earnings Per Share and Weighted-Average Shares Outstanding](index=31&type=section&id=(4)%20Earnings%20Per%20Share%20and%20Weighted-Average%20Shares%20

Core Insights - Leasing activity in the Harwood District reached a record-breaking 342,163 square feet in 2024, with transactions valued at over $200 million, indicating strong demand for its offerings [2][6] - The Harwood District is recognized as a premier example of integrated urban development, blending hospitality, art, nature, and design, with a Walk Score of 94, making it one of the most walkable mixed-use environments in Dallas [3][4] - Harwood International emphasizes a commitment to delivering premier experiences that enhance productivity and well-being for tenants, supported by extensive amenities and cultural integration [7][11] Company Overview - Harwood International, founded in 1988, is an international real estate firm known for creating landmark properties characterized by design excellence and prime locations [10] - The company has received numerous accolades, including ENR's "Best Office Project in the World" for the Rolex Building and recognition for Hôtel Swexan, which was awarded a One MICHELIN Key in 2024 [11] - Harwood International integrates art into its developments, enhancing the connection between people and place, and is committed to sustainability and energy efficiency [11] Market Dynamics - The Harwood District has historically maintained over 90 percent occupancy and leads the market in leasing rates, driven by its luxury experience and exceptional design [2] - The upcoming Goldman Sachs project in 2027 and the establishment of the Texas Stock Exchange are expected to further boost the growth of the Harwood District [1] - Dallas is set to gain global attention with events like the FIFA World Cup 26 and the expansion of the Kay Bailey Hutchison Convention Center, positioning the city for economic momentum [1][6] Amenities and Lifestyle - The Harwood District offers a unique work-life balance with direct access to wellness programming, state-of-the-art fitness centers, and vibrant social spaces [7] - Culinary experiences, including MICHELIN-recognized restaurants, enhance the district's appeal, contributing to a luxury lifestyle office environment [8][9] - The district features over 20 world-class restaurants, bars, and cultural venues, enriching the neighborhood and attracting tenants [8]

Core Viewpoint - The research service "Asia Value & Moat Stocks" targets value investors looking for Asia-listed stocks that exhibit a significant disparity between market price and intrinsic value, focusing on deep value balance sheet bargains and wide moat stocks [1] Group 1: Investment Focus - The service emphasizes deep value balance sheet bargains, which include net cash stocks, net-nets, low price-to-book (P/B) stocks, and sum-of-the-parts discounts [1] - It also highlights wide moat stocks, which are characterized by strong earnings power at a discount, including high-quality businesses and hidden champions [1] Group 2: Market Emphasis - The primary focus of the investment ideas is on the Hong Kong market, providing a range of watch lists with monthly updates for investors [1]

Core Viewpoint - Newmark Group (NMRK) reported quarterly earnings of $0.21 per share, exceeding the Zacks Consensus Estimate of $0.19 per share, and showing an increase from $0.15 per share a year ago, indicating a positive earnings surprise of 10.53% [1] Financial Performance - The company achieved revenues of $665.49 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 11.04%, compared to $546.5 million in the same quarter last year [2] - Over the last four quarters, Newmark Group has exceeded consensus EPS estimates three times and topped revenue estimates two times [2] Stock Performance - Newmark Group shares have declined approximately 13.7% since the beginning of the year, while the S&P 500 has decreased by 5.5% [3] - The stock's immediate price movement will largely depend on management's commentary during the earnings call [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.25, with expected revenues of $687.2 million, and for the current fiscal year, the estimate is $1.42 on $3.01 billion in revenues [7] - The estimate revisions trend for Newmark Group is mixed, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market in the near future [6] Industry Context - The Real Estate - Operations industry, to which Newmark Group belongs, is currently ranked in the bottom 41% of over 250 Zacks industries, indicating potential challenges ahead [8]

Financial Data and Key Metrics Changes - The company reported a 21.8% increase in revenues, reaching $665.5 million compared to $546.5 million in the previous year [9] - Adjusted EPS increased by 40% to $0.21 from $0.15, and adjusted EBITDA rose by 40.5% to $89.2 million from $63.5 million [11] - The adjusted EBITDA margin improved by approximately 180 basis points to 13.4% [11] Business Line Data and Key Metrics Changes - Capital markets revenues grew by 32.7%, reflecting a 62.5% volume improvement across all major property types [10] - Leasing fees increased by 31%, driven by strong activity in New York City, Boston, and a rebound in the San Francisco Bay Area [6] - Management services and servicing revenues rose by over 10%, marking the seventh consecutive period of year-on-year improvement [9] Market Data and Key Metrics Changes - The company experienced double-digit growth across every major business line, indicating robust market performance [5] - The capital markets segment outpaced the industry in both investment sales and origination [5] - The company noted potential geopolitical headwinds that could dampen industry activity, despite current strong performance [7] Company Strategy and Development Direction - The company aims to enhance capabilities across various verticals and geographies while diversifying into more service lines and alternative property types [6] - There is a focus on building a scalable and sustainable enterprise, leveraging deep client relationships and brand strength to gain market share [7] - The company is cautious about acquisitions, preferring organic growth and talent acquisition over large-scale mergers [42] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current business environment, noting that deals and leases continue to progress without significant pullbacks [18] - The company maintains its 2025 outlook, citing macroeconomic uncertainties as a reason for a cautious approach despite strong first-quarter performance [33] - There is confidence in the recurring revenue model, with 40% of revenues and earnings being recurring, providing good visibility into the second half of the year [34] Other Important Information - The company ended the quarter with $157.1 million in cash and cash equivalents and a net leverage ratio of 1.3 times [12] - There is $371.9 million remaining under the share repurchase program, with plans for future buybacks as conditions allow [11] Q&A Session Summary Question: Insights on client relationships and macro uncertainty - Management noted that deals are still progressing and there hasn't been a significant change in decision-making despite macro uncertainties [18] Question: Stock buybacks in the current economic climate - The CFO expressed confidence in engaging in stock buybacks, citing a clean balance sheet and low net leverage [21] Question: Differentiation in management services - The company highlighted its managed service program and focus on partnership with investor clients as key differentiators in management services [24] Question: Current appetite for M&A versus talent acquisition - Management indicated a careful approach to acquisitions, preferring organic growth and talent acquisition while remaining open to strategic purchases [42] Question: Outlook for multifamily housing - Management emphasized the ongoing demand for multifamily housing, citing a shortage and changing consumer behaviors as supportive factors [48]

Financial Data and Key Metrics Changes - The company reported a 22% increase in revenues, reaching $665.5 million compared to $546.5 million in the previous year [5][8] - Earnings metrics grew approximately 40%, with adjusted EPS increasing by 40% to $0.21 from $0.15 [10] - Adjusted EBITDA was $89.2 million, up 40.5% from $63.5 million, with an adjusted EBITDA margin improvement of approximately 180 basis points to 13.4% [10] Business Line Data and Key Metrics Changes - Capital markets revenues grew by 33%, with a 62.5% volume improvement across all major property types, including a 40% increase in GSE FHA origination volumes [5][8] - Leasing fees increased by 31%, driven by heightened activity in New York City, Boston, and a strong rebound in the San Francisco Bay Area [6][8] - Management and servicing revenues rose by over 10%, marking the seventh consecutive period of solid year-on-year improvement [8] Market Data and Key Metrics Changes - The company noted strong double-digit growth in office and retail leasing volumes, contributing to the overall increase in leasing revenues [8] - Despite potential geopolitical headwinds, the company anticipates further market share gains over time [7] Company Strategy and Development Direction - The company is focused on enhancing capabilities across various verticals and geographies while diversifying into more service lines and alternative property types [6] - The management emphasized a strategy of organic growth, with a careful approach to acquisitions, prioritizing talent acquisition over large-scale mergers [42][43] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the current business environment, noting that deals and leases continue to progress without significant pullbacks [17][18] - The company maintains its 2025 outlook, citing macroeconomic uncertainties as a reason for a cautious approach despite strong performance in the first quarter [11][36] Other Important Information - The company ended the quarter with $157.1 million in cash and cash equivalents and a net leverage ratio of 1.3 times [11] - There is $371.9 million remaining under the share repurchase program, with management indicating a willingness to engage in buybacks as conditions allow [10][20] Q&A Session Summary Question: Insights on client relationships and macro uncertainty - Management noted that deals are still progressing and there hasn't been a significant change in decision-making despite macro uncertainties [17][18] Question: Transaction market activity - Management indicated that there hasn't been a noticeable slowdown in putting properties on the market, although interest rate changes could influence future decisions [19] Question: Stock buybacks in the current environment - Management expressed confidence in engaging in stock buybacks, citing a clean balance sheet and low net leverage [20] Question: Differentiation in management services - Management highlighted unique offerings such as managed service programs and a focus on partnership with investor clients as key differentiators [24][25] Question: Guidance maintenance despite strong performance - Management explained that while the first quarter was strong, macroeconomic conditions warranted a cautious approach to guidance [34][36] Question: Current appetite for M&A - Management stated that growth has been primarily organic, but they remain open to acquisitions if they align with strategic goals [42][43] Question: Outlook for multifamily housing - Management indicated a strong demand for multifamily housing, driven by a shortage and changing consumer behaviors [47][48] Question: Competitive environment for recruiting - Management asserted that Newmark remains a desirable employer, with ongoing recruitment efforts focused on maintaining high revenue per capita [52][54]

Financial Performance - Total revenues for Q1 2025 were $665.5 million, a 21.8% increase compared to $546.5 million in Q1 2024[5] - GAAP net income improved to a loss of $8.8 million, a 46.1% reduction from a loss of $16.3 million in the previous year[5] - Post-tax adjusted earnings rose to $54.3 million, reflecting a 45.2% increase from $37.4 million in Q1 2024[5] - Total revenues for FY 2025 are projected to be between $2,900 million and $3,100 million, representing a year-on-year increase of 6% to 13% from the FY 2024 actual of $2,738.5 million[19] - Adjusted Earnings Per Share for FY 2025 is expected to be in the range of $1.40 to $1.50, reflecting a year-on-year growth of 14% to 22% from the FY 2024 actual of $1.23[19] - Adjusted EBITDA for FY 2025 is forecasted to be between $495 million and $545 million, indicating an 11% to 22% increase compared to the FY 2024 actual of $445.3 million[19] - Total revenues for Q1 2025 reached $665.5 million, a 21.7% increase from $546.5 million in Q1 2024[41] - Management services, servicing fees, and other revenues increased to $283.9 million, up 10.5% from $256.9 million year-over-year[41] - Leasing and other commissions rose to $208.1 million, a 30.9% increase compared to $158.8 million in the same period last year[41] - Capital markets revenues grew by 32.6% to $173.5 million from $130.8 million year-over-year[41] - Adjusted Earnings before noncontrolling interests and taxes for Q1 2025 was $62.85 million, up 46% from $42.91 million in Q1 2024[84] - Post-tax Adjusted Earnings for Q1 2025 reached $54.35 million, compared to $37.42 million in Q1 2024, reflecting a 45% year-over-year increase[84] - Adjusted EBITDA for Q1 2025 was $89.20 million, a 40% increase from $63.48 million in Q1 2024[92] Expenses and Liabilities - Total expenses for Q1 2025 were $683.8 million, a 20.1% increase from $569.1 million in Q1 2024[10] - Total operating expenses increased to $683.8 million, up 20.2% from $569.1 million in Q1 2024[41] - Cash and cash equivalents decreased to $157.1 million from $197.7 million at the end of 2024, while total corporate debt rose to $770.9 million[14] - Total liabilities rose to $3.29 billion, compared to $3.17 billion at the end of Q4 2024[39] Capital and Liquidity - Newmark's net leverage ratio was 1.3 times as of March 31, 2025[14] - Total corporate debt as of March 31, 2025, was $770.9 million, resulting in a net leverage ratio of 1.3 times based on trailing twelve-month Adjusted EBITDA of $471.0 million[99] - Newmark's liquidity is defined as the sum of cash and cash equivalents, marketable securities, and reverse repurchase agreements, less securities lent out[77] - The company’s liquidity excludes marketable securities financed and does not include the value of undrawn revolving credit lines[6] Dividends and Share Count - A quarterly dividend of $0.03 per share was declared, payable on May 29, 2025[16] - The company aims for annual share count growth of 2% or less over time[20] - Future dividends payable by the company will be at the discretion of its Board of Directors, based on the fully diluted share count[69] Market Outlook - The outlook for FY 2025 is contingent on the recovery of industry leasing and capital markets activity, amidst macroeconomic uncertainties[19] - Newmark's total revenues include non-cash gains from originated mortgage servicing rights, which are recognized at commitment[23] - The company continues to focus on its Management Services, Servicing, and Asset Management businesses, which are considered resilient and recurring revenue streams[24] Notable Transactions - Recent notable transactions include a $360 million sale of two office towers and a $2.3 billion construction financing for a data center[32] Operational Metrics - Newmark generated revenues of over $2.8 billion for the twelve months ended March 31, 2025[102] - As of March 31, 2025, Newmark operated from 165 offices with approximately 8,100 professionals across four continents[102] - Newmark provides a comprehensive suite of services and products tailored to various clients, including owners, occupiers, investors, and startups[102]

Newmark Group, Inc. (Nasdaq: NMRK) First Quarter 2025 Financial Results Presentation April 30, 2025 Property Type: Office N M R K .C OM Disclaimers Discussion of Forward-Looking Statements References in this document to "we," "us," "our," the "Company" and "Newmark" mean Newmark Group, Inc., and its consolidated subsidiaries. Statements in this document regarding Newmark that are not historical facts are "forward-looking statements" that involve risks and uncertainties, which could cause actual results to d ...