Newmark(NMRK) - 2025 Q1 - Quarterly Report

FORM 10-Q Glossary of Terms, Abbreviations, and Acronyms Where You Can Find More Information Special Note Regarding Forward-Looking Information 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] - 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][28][29] PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS (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 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 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 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 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] Condensed Consolidated Statements of Cash Flows 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 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 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] - The financial statements are prepared in conformity with U.S. GAAP, with certain reclassifications made for current presentation[44] - Newmark receives administrative services from Cantor, with allocated expenses included as "Fees to related parties," which management believes reasonably reflect service utilization[46][48] (2) Limited Partnership Interests in Newmark Holdings and BGC Holdings 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][74] - 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][69] - Cantor holds limited partnership interests (Cantor Units) reflected as noncontrolling interests, receiving quarterly net income (loss) allocations[73] (3) Summary of Significant Accounting Policies 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][81] - 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][84][85] - 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][96][99] [(4) Earnings Per Share and Weighted-Average Shares Outstanding](index=31&type=section&id=(4)%20Earnings%20Per%20Share%20and%20Weighted-Average%20Shares%20