Cushman & Wakefield(US:CWK)2025-10-30 20:36Financial Performance - Revenue for Q3 2025 was $2.6 billion, an increase of 11% compared to Q3 2024[144] - Net income for Q3 2025 was $51.4 million, up $17.7 million from Q3 2024, with diluted earnings per share rising to $0.22 from $0.14[144] - Adjusted EBITDA for Q3 2025 increased by 12% to $159.6 million compared to Q3 2024[144] - Year-to-date revenue for the nine months ended September 30, 2025, was $7.4 billion, an 8% increase from the same period in 2024[144] - Total revenue for Q3 2025 reached $2,605.9 million, an 11% increase compared to $2,344.2 million in Q3 2024[168] - Adjusted EBITDA for Q3 2025 was $159.6 million, a 12% increase from $142.5 million in Q3 2024, with an Adjusted EBITDA margin of 9.0%[168][169] - Net income for Q3 2025 was $51.4 million, representing a 53% increase from $33.7 million in Q3 2024, with a net income margin of 2.0%[168] - Services revenue increased by 6% year-over-year to $920.2 million in Q3 2025, while leasing revenue grew by 9% to $538.3 million[168] - Operating income for Q3 2025 was $107.5 million, a 43% increase compared to $75.2 million in Q3 2024[168] - Net income for the nine months ended September 30, 2025, was $110.6 million, an increase of $92.2 million from the prior year, resulting in a net income margin of 1.5% compared to 0.3%[192] - Adjusted EBITDA for the nine months ended September 30, 2025, was $417.5 million, reflecting a 16% increase or $58.0 million compared to the same period in 2024, with an adjusted EBITDA margin of 8.3%[193] Revenue Breakdown - Capital markets revenue for Q3 2025 rose by 21%, driven by strong performance across all asset classes in the Americas[144] - Services revenue for Q3 2025 increased by 6%, or 7% excluding the impact of a non-core business sale[144] - Capital markets revenue surged by 21% to $204.7 million in Q3 2025, reflecting strong performance in this segment[168] - Revenue for the nine months ended September 30, 2025, was $7.4 billion, an increase of $557.4 million or 8% compared to the same period in 2024, driven by a 20% increase in capital markets revenue[184] - Total revenue for the Americas segment in the nine months ended September 30, 2025, was $5.4 billion, an increase of $331.0 million or 7% from the prior year, driven by an 11% growth in Leasing revenue[200] - EMEA revenue for the three months ended September 30, 2025, was $260.1 million, an increase of $40.2 million or 18% from the same quarter in 2024, with a 12% increase on a local currency basis[205] - APAC revenue for the nine months ended September 30, 2025, was $1.2 billion, a 16% increase from the previous year, with a 17% increase on a local currency basis[216] Costs and Expenses - Total costs and expenses for Q3 2025 were $2,498.4 million, a 10% increase from $2,269.0 million in Q3 2024[168] - Costs of services for the three months ended September 30, 2025, were $2.2 billion, reflecting a $240.2 million or 13% increase compared to Q3 2024, primarily due to higher employment costs[176] - Costs of services for the nine months ended September 30, 2025, were $6.1 billion, reflecting an increase of $449.8 million or 8% compared to the same period in 2024[185] - Operating, administrative, and other expenses for the nine months ended September 30, 2025, were $944.7 million, an increase of $40.3 million or 4% compared to the same period in 2024[186] - Fee-based operating expenses in the Americas for the nine months ended September 30, 2025, were $3.3 billion, an increase of 6% primarily due to higher employment costs of approximately $220.0 million[201] - Fee-based operating expenses in EMEA increased by 3% to $578.3 million, mainly due to higher employment costs and third-party consumables[209] - Fee-based operating expenses in APAC increased by 5% to $782.1 million, driven by higher employment costs and third-party consumables[217] Liquidity and Financing - Liquidity as of September 30, 2025, was $1.7 billion, consisting of $1.1 billion in undrawn revolving credit and $0.6 billion in cash[144] - The company prepaid $300.0 million in principal under its Term Loans year-to-date as of October 29, 2025[143] - The company generated $83.1 million in cash from operating activities during the nine months ended September 30, 2025, a decrease of $9.7 million from the previous year[228] - The company used $233.1 million in cash for financing activities during the nine months ended September 30, 2025, an increase of $35.6 million from the same period in 2024, primarily due to a $50.0 million increase in principal repayments under the 2018 Credit Agreement[230] Market Conditions and Risks - The company faces significant macroeconomic uncertainty that could negatively impact demand for its services[145] - Approximately 30% of the company's revenue for the three and nine months ended September 30, 2025, was transacted in currencies other than USD, compared to 29% for the same periods in 2024[236] - If variable interest rates increased by 100 basis points as of September 30, 2025, the company would incur an incremental interest expense of approximately $8.0 million[235] - A hypothetical 10% increase in the value of the USD against the Singapore dollar, euro, and Australian dollar would have resulted in a revenue decrease of approximately $9.3 million, $12.7 million, and $11.4 million, respectively, for the three months ended September 30, 2025[236] - The company manages foreign exchange risk by establishing local operations, invoicing in local currencies, and using derivative financial instruments such as foreign currency forward contracts[237] Debt and Interest Rates - The 2030 Tranche-1 of the company's Term Loans was repriced in October 2025, reducing the applicable interest rate by 25 basis points to 1-month Term SOFR plus 2.50%[233] - The company's 2028 Notes and 2031 Notes bear fixed interest rates of 6.75% and 8.88%, respectively[233] - The company employs interest rate swap agreements to hedge against interest rate volatility and limit the impact of interest rate changes on earnings and cash flows[234]