NEWMARK GROUP INC

Previous wording

This discussion summarizes the significant factors affecting our results of operations and financial condition during the three and nine months ended September 30, 2024 and 2023. We operate in one reportable segment, real estate services. This discussion is provided to increase the understanding of, and should be read in conjunction with, our accompanying unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q.

Current wording

This discussion summarizes the significant factors affecting our results of operations and financial condition during the three months ended March 31, 2025 and 2024. We operate in one reportable segment, real estate services. This discussion is provided to increase the understanding of, and should be read in conjunction with, our accompanying unaudited condensed consolidated financial statements and the notes thereto included elsewhere in this Quarterly Report on Form 10-Q.

Previous wording

Management Services, Servicing Fees and Other

Current wording

There are several factors that impact results across our three main revenue sources (management services, servicing fees and other; leasing and other commissions; and capital markets), including both secular and cyclical industry trends as well as macroeconomic dynamics and our investments in growth. These factors are discussed below.

Previous wording

We also think that the current market conditions have created an opportunity for us to solidify what we believe is our position as the platform of choice for many of the real estate industry’s top professionals. During the nine months of 2024, we hired one of the top multifamily GSE/FHA originators in the U.S., who will work closely with the preeminent U.S. affordable housing investment sales team that we added earlier in the year. We also hired some of the most prolific and experienced debt and structured finance professionals in the U.S. and U.K., as well as some of the most innovative and active U.S. leasing teams. Newmark also opened a flagship office in France, continental Europe’s second largest transaction market, where we attracted some of the most talented leasing and capital markets professionals. In October of this year, our European expansion continued with the launch of our capital markets and leasing businesses in Germany. We believe that these additions further demonstrate the strength of our global brand, and that our substantial investments in data, analytics, and talent position Newmark to capitalize on ongoing macroeconomic trends. Furthermore, our revenue-generating headcount was relatively flat year-on-year as of the end of the third quarter of 2024. Therefore, productivity gains drove the large majority of our total revenue growth, as well as our increased fees across capital markets, leasing, and V&A. As more of our recently hired revenue-generating professionals ramp up, we expect further productivity gains over time.

Current wording

Attracting and Retaining Revenue-Generating Headcount. During 2024 and the first quarter of 2025, we continued to solidify what we believe is our position as the platform of choice for many of the real estate industry’s top professionals. In the U.S., U.K., France, Germany, Singapore, and other locations, we attracted some of the most prolific and experienced revenue-generating employees. We believe that these additions further demonstrate the strength of our global brand, and the value of our substantial investments in data, analytics, and talent. Furthermore, our revenue-generating headcount was up modestly year-on-year as of March 31, 2025, after having been relatively flat year-on-year at the end of each of the four previous quarters. Therefore, productivity gains drove the large majority of our total revenue growth, as well as our increased fees across Capital Markets, Leasing, and Valuation & Advisory. Newly added revenue-generating professionals typically take 6 to 18 months to produce meaningful fees. As more of our recently hired team members ramp up, we expect further productivity gains over time.

Previous wording

Commercial real estate leasing activity has historically been positively correlated with job creation, particularly with respect to office-based employment, and GDP growth. While the solid U.S. economic improvement over the past several quarters has provided a tailwind to leasing activity across industrial, retail and office properties, this has been offset by the negative impact of the post-pandemic rise in remote working. In the U.S., and to a lesser extent in Europe, this has reduced demand for all but premium Class A office properties generally, as well as for retail space in many business districts.

Current wording

Trends in GDP and Job Growth. Commercial real estate leasing activity has historically been positively correlated with job creation, particularly with respect to office-based employment, and GDP growth.

Previous wording

Commercial real estate capital markets transactions involving financing generally utilize medium- or long-term debt, and the interest rates for such debt tend to correlate with movements in benchmark rates with similar tenors, including U.S. Treasuries. Such benchmark rates can be meaningfully impacted by movements in key short-term rates, such as the Fed Funds Target rate. Sudden increases in short term interest rates can therefore have pronounced effects on commercial mortgage origination and investment sales volumes. In 2022, global benchmark interest rates rose at the fastest pace since at least the early 1990s, according to Fitch. U.S. and U.K. ten-year government yields continued to rise through October of 2023, fell over the remainder of that year, but gradually rose over the first nine months of 2024. This led to challenging market conditions across commercial real estate capital markets for Newmark and the industry. Real estate capital market transactions were also lower due to the pullback in commercial and multifamily real estate lending activity as a response to recent bank failures and higher interest rates, as well as the gap between buyer and seller expectations. Most major central banks recently began lowering their short term rates. Partly as a result of this, industry capital markets volumes generally declined by less or grew year-over-year in the third quarter of 2024, as discussed below.

Current wording

Interest Rate Environment. Commercial real estate capital markets transactions involving financing generally utilize medium- or long-term debt, and the interest rates for such debt tend to correlate with movements in benchmark rates with similar tenors, including U.S. Treasuries. Such benchmark rates can be meaningfully impacted by movements in key short-term rates, such as the Fed Funds Target rate. Sudden changes in short term interest rates can therefore have pronounced effects on commercial mortgage origination and investment sales volumes.

Previous wording

While short-term yields are expected to be higher compared with most of the period from the end of 2008 through early 2022, they are expected to stabilize and gradually fall from more recent levels. For context, the upper bound of the Fed Funds Target rate averaged 0.64% from December 31, 2008 through February 28, 2022, and averaged approximately 4.9% and

Current wording

As of March 31, 2025, the most commonly cited U.S. and U.K. inflation measures were at 2.4% and 3.2%, respectively, or still higher than the 2% targets set by both the FOMC and MPC. In addition, most economists expect inflation to remain above these targets for the next two years largely due to the expected impact of tariffs, partially offset by the expected slowing of GDP growth. As a result, short-term yields are expected to be higher compared with most of the period from the end of 2008 through early 2022. For example, the April 2025 Bloomberg consensus was for Fed Funds Target rate target rate to be approximately 4.0% and 3.5%, respectively, by the ends of 2025 and 2026, and for the Bank of England’s short-term target rate to be 3.8%, and 3.4%, respectively, over the same period. For context, the upper bound of the Fed Funds Target rate averaged 0.64% from December 31, 2008 (near the height of the global financial crises) through February 28, 2022 (when the FOMC began raising this rate), and averaged approximately 4.9% and 3.1% over the 50 years and 25 years ended December 31, 2022, respectively. The Official Bank Rate averaged 0.47% from December 31, 2008 through February 28, 2022, and approximately 2.4% and 6.3% over the 25 and 50 years ended December 31, 2024, with both sets of long-term data from Bloomberg.

Previous wording

We expect demand for office space to be driven by the reset in values due to near-term debt maturities. We also continue to see increased need for office space in certain markets, led by ongoing return-to-work plans, as well as new demand driven by companies in technology including artificial intelligence as well as financial services. According to the Freespace Index, the proportion of those attending work in person rose to 81% of 2019 levels in the Americas in September of 2024 compared with 67% a year earlier. The Freespace Index also reports that attendance increased to 73% of 2019 levels from 65% over the same timeframe across locations they track in Europe, the Middle East, and Africa, and to 77% from 69% in the Asia-Pacific region. Other measures with different methodologies also show in-person attendance increasing. For example, the Kastle Barometer, which measures daily occupancy in ten large U.S. cities versus pre-pandemic levels, increased to 52% as of October 11, 2024, versus 47% a year earlier. Placer.ai data comparing September 2024 versus a year earlier indicates that in-person attendance in the U.S. increased to 69% versus 64%. Our management services, leasing, origination, and capital markets professionals continue to actively collaborate with clients to repurpose underutilized spaces and assets, including with respect to conversion of obsolete office or retail properties.

Current wording

We expect demand for office space to be driven by the reset in values due to near-term debt maturities. We also continue to see increased need for office space in an increasing number of markets, led by ongoing return-to-work plans, as well as new demand driven by companies in technology including AI as well as financial services. Placer.ai data for March 2025 indicates that in-person attendance in the U.S. improved to approximately 65% of January 2020 pre-pandemic levels versus 61% a year earlier. Our management services, leasing, origination, and capital markets professionals continue to actively collaborate with clients to repurpose underutilized spaces and assets, including with respect to conversion of obsolete office or retail properties.

Previous wording

As part of our compensation plans, certain employees have been granted limited partnership units in Newmark Holdings and, prior to the Newmark IPO, BGC Holdings, which generally receive quarterly allocations of net income and are generally contingent upon services being provided by the unit holders. As a result of the Corporate Conversion, there are no longer any limited partnership units in BGC Holdings outstanding. Certain Newmark employees also hold N Units that do not participate in quarterly partnership distributions and are not allocated any items of profit or loss. These N Units vest into distribution earnings units over a three- to ten-year period. As prescribed in U.S. GAAP guidance, the quarterly allocations of net income on such limited partnership units are reflected as a component of compensation expense under “Equity-based compensation and allocations of net income to limited partnership units and FPUs” in our accompanying unaudited condensed consolidated statements of operations.

Current wording

As part of our compensation plans, certain employees have been granted limited partnership units in Newmark Holdings and, prior to the Newmark IPO, BGC Holdings, which generally receive quarterly allocations of net income and are generally contingent upon services being provided by the unit holders. As a result of the Corporate Conversion, there are no longer any limited partnership units in BGC Holdings outstanding. Certain Newmark employees also hold N Units that do not participate in quarterly partnership distributions and are not allocated any items of profit or loss. N Units become distribution earning limited partnership units either on a discretionary basis or ratably over a vesting term, if certain revenue thresholds are met at the end of each vesting term. As prescribed in U.S. GAAP guidance, the quarterly allocations of net income on such limited partnership units are reflected as a component of compensation expense under “Equity-based compensation and allocations of net income to limited partnership units and FPUs” in our accompanying unaudited condensed consolidated statements of operations.

Previous wording

We incur income tax expenses based on the location, legal structure, and jurisdictional taxing authorities of each of our subsidiaries. Certain of the Company’s entities are taxed as U.S. partnerships and are subject to the UBT in New York City. U.S. federal and state income tax liability or benefit related to the partnership income or loss, with the exception of the UBT, rests with the partners (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings” to our accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q) rather than the partnership entity. Our accompanying unaudited condensed consolidated financial statements include U.S. federal, state and local income taxes on Newmark’s allocable share of the U.S. results of operations. Outside of the U.S., we operate principally through subsidiary corporations subject to local income taxes.

Current wording

We incur income tax expenses based on the location, legal structure, and jurisdictional taxing authorities of each of our subsidiaries. Certain of the Company’s entities are taxed as U.S. partnerships and are subject to primarily the UBT in New York City. U.S. federal and state income tax liability or benefit related to the partnership income or loss, with the exception of the UBT, rests with the partners rather than the partnership entity (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings” to our accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q). Our accompanying unaudited condensed consolidated financial statements include U.S. federal, state and local income taxes on Newmark’s allocable share of the U.S. results of operations. Outside of the U.S., we operate principally through subsidiary corporations subject to local income taxes.

Previous wording

Newmark is subject to the tax laws and regulations of the U.S. and various non-U.S. jurisdictions. The OECD Pillar Two Framework provides for a minimum global effective tax rate of 15%. The EU Member States formally adopted the EU’s Pillar Two Directive with a subset of rules that became effective January 1, 2024. Other countries are also expected to implement similar legislation. We do not believe this will have a material impact on our tax rate.

Current wording

Newmark is subject to the tax laws and regulations of the U.S. and various non-U.S. jurisdictions. The OECD Pillar Two Framework provides for a minimum global effective tax rate of 15%. The EU Member States formally adopted the EU’s Pillar Two Directive with a subset of rules that became effective January 1, 2024. Other countries are also expected to implement similar legislation. The minimum global effective tax did not have a material impact on our 2024 and 2025 tax rates.

Previous wording

Our pre-tax margins are affected by the mix of revenues generated. For example, servicing revenues tend to have higher pre-tax margins than Newmark as a whole, and margins from originating GSE/FHA loans, which are included in “Capital markets” in our unaudited condensed consolidated statement of operations, tend to be lower, as we retain rights to service loans over time, and because this item includes non-cash GAAP gains attributable to OMSRs, which represent the fair value of expected net future cash flows from servicing recognized at commitment, net. Capital markets transactions tend to have higher pre-tax margins than leasing transactions. Pre-tax earnings margins on our property management and parts of our other GCS businesses are at the lower end of margins for the Company as a whole because they include some revenues that equal their related expenses. These revenues represent fully reimbursable compensation and non-compensation costs and may be referred to as “pass through revenues.”

Current wording

Our pre-tax margins are affected by the mix of revenues generated. For example, servicing revenues tend to have higher pre-tax margins than Newmark as a whole, and margins from originating GSE/FHA loans, which are included in “Capital markets” in our consolidated statement of operations, tend to be lower, as we retain rights to service loans over time, and because this item includes non-cash GAAP gains attributable to OMSRs, which represent the fair value of expected net future cash flows from servicing recognized at commitment, net. Capital markets transactions tend to have higher pre-tax margins than leasing transactions. Pre-tax earnings margins on our property management and parts of our other OS businesses are at the lower end of margins for the Company as a whole because they include some revenues that equal their related expenses. These revenues represent fully reimbursable compensation and non-compensation costs and may be referred to as “pass through revenues.”

Previous wording

Due to the strong desire of many market participants to close real estate transactions prior to the end of a calendar year, our business exhibits certain seasonality, with our revenue tending to be lowest in the first quarter and strongest in the fourth quarter. For the five years from 2019 through 2023, we generated an average of approximately 22% of our revenues in the first quarter and 29% of our revenues in the fourth quarter. Because approximately 30% of our expenses are fixed in a typical year, this seasonality generally leads to higher profitability in the fourth quarter and lower margins in the first quarter, all else equal.

Current wording

Due to the strong desire of many market participants to close real estate transactions prior to the end of a calendar year, our business exhibits certain seasonality, with our revenue tending to be lowest in the first quarter and strongest in the fourth quarter. For the five years from 2020 through 2024, we generated an average of approximately 21% of our revenues in the first quarter and 30% of our revenues in the fourth quarter. Because approximately 30% of our expenses are fixed in a typical year, this seasonality generally leads to higher profitability in the fourth quarter and lower margins in the first quarter, all else equal.

Previous wording

The following table sets forth our unaudited condensed consolidated statements of operations data expressed as a percentage of total revenues for the periods indicated (in thousands):

Current wording

The following table sets forth our consolidated statements of operations data expressed as a percentage of total revenues for the periods indicated (in thousands):

Previous wording

Management services, servicing fees and other revenue increased by $28.9 million, or 11.4%, to $282.6 million for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. This increase reflects growth from our GCS, servicing, and property management businesses, as well as higher V&A fees.

Current wording

Management services, servicing fees and other revenue increased by $27.0 million, or 10.5%, to $283.9 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. This increase reflects growth from V&A fees, as well as new and expanded client mandates across the Newmark’s suite of outsourcing businesses.

Previous wording

Compensation and employee benefits expense increased by $21.0 million to $392.3 million for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The increase reflects improved commission-based revenue.

Current wording

Compensation and employee benefits expense increased by $71.3 million, or 21.7%, to $399.5 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The increase reflects higher commission-based revenues and other costs related to Newmark’s growth initiatives.

Previous wording

Operating, administrative and other expenses increased by $11.0 million, or 7.8%, to $151.9 million for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 primarily related to costs associated with higher revenues from management services, servicing fees, and other.

Current wording

Operating, administrative and other expenses increased by $16.0 million, or 11.6%, to $154.0 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 due to higher pass through costs and other items related to increased revenues.

Previous wording

Fees to related parties increased by $1.4 million, or 22.3%, to $7.6 million for the three months ended September 30, 2024, compared to the three months ended September 30, 2023.

Current wording

Fees to related parties increased by $2.0 million, or 26.9%, to $9.6 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024.

Previous wording

Depreciation and amortization for the nine months ended September 30, 2024 increased by $7.1 million, or 5.8%, to $129.4 million compared to the nine months ended September 30, 2023 due to an increase in intangible asset amortization of $1.5 million and a $5.0 million change in MSR valuation allowance.

Current wording

Depreciation and amortization for the three months ended March 31, 2025 increased by $2.4 million, or 5.4%, to $46.4 million compared to the three months ended March 31, 2024 due to a $4.4 million increase in fixed asset impairment related to terminated leases, offset by a $1.2 million decrease in MSR valuation allowance.

Previous wording

Other income (loss), net of $0.3 million in the three months ended September 30, 2024 primarily consisted of recoveries from forfeited restricted Newmark Class A common stock.

Current wording

Other income (loss), net of $0.8 million in the three months ended March 31, 2025 consisted primarily of recoveries from forfeited restricted Newmark Class A common stock.

Previous wording

Interest expense, net increased by $0.3 million, or 4.3%, to $7.9 million during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 due to higher interest expense on our corporate debt, partially offset by higher interest income, which primarily relates to interest income on employee loans.

Current wording

Interest expense, net increased by $1.3 million, or 17.5%, to $8.5 million during the three months ended March 31, 2025 compared to the three months ended March 31, 2024 primarily due to higher interest expense on our corporate debt.

Previous wording

Provision for income taxes increased by $2.4 million, or 19.6%, to $14.4 million for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. In general, our consolidated effective tax rate can vary from period to period depending on, among other factors, the geographic and business mix of our earnings.

Current wording

Benefit for income taxes increased by$6.5 million, to$10.1 million for thethree months ended March 31, 2025 compared to thethree months ended March 31, 2024 primarily due to revaluation of deferred tax assets in 2025 and larger valuation allowance on international losses in 2024. In general, our consolidated effective tax rate can vary from period to period depending on, among other factors, the level, geography and business mix of our earnings.

Previous wording

Net loss attributable to noncontrolling interests

Current wording

Net loss attributable to noncontrolling interests decreased by $2.9 million, or 28.6%, to $7.2 million for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. This decrease was primarily driven by a lower pre-tax loss and a decline in ownership of Newmark Holdings in Newmark OpCo.

Previous wording

Our future capital requirements will depend on many factors, including our growth, the expansion of our sales and marketing activities, our expansion into other markets, our acquisitions of other companies and hiring of teams of producers, and our results of operations. To the extent that existing cash, cash from operations and credit facilities are insufficient to fund our future activities, we may need to raise additional funds through public equity or debt financing. As of September 30, 2024, our debt consisted of $600.0 million aggregate principal amount of 7.500% Senior Notes with a carrying amount of $595.2 million and $175.0 million outstanding under the Credit Facility with a carrying amount of $175.0 million, in each case exclusive of our warehouse facilities described under “—Warehouse Facilities Collateralized by U.S. Government Sponsored Enterprises.”

Current wording

Our future capital requirements will depend on many factors, including our growth, the expansion of our sales and marketing activities, our expansion into other markets, our acquisitions of other companies and hiring of teams of producers, and our results of operations. To the extent that existing cash, cash from operations and credit facilities are insufficient to fund our future activities, we may need to raise additional funds through public equity or debt financing. As of March 31, 2025, our debt consisted of $600.0 million aggregate principal amount of 7.500% Senior Notes with a carrying amount of $595.9 million and $175.0 million outstanding under the Credit Facility with a carrying amount of $175.0 million, in each case exclusive of our warehouse facilities described under “—Warehouse Facilities Collateralized by U.S. Government Sponsored Enterprises.”

Previous wording

At September 30, 2024, we had cash and cash equivalents of $178.6 million. Additionally, we had $425.0 million available under our committed senior unsecured revolving Credit Facility. We expect to generate cash flows from operations to fund our business and use those funds, and our Credit Facility, to meet our short-term liquidity requirements, which we define as those arising within the next twelve months, and our long-term liquidity requirements, which we define as those beyond the next twelve months.

Current wording

As of March 31, 2025, we had cash and cash equivalents of $157.1 million. Additionally, we had $425.0 million available under our committed senior unsecured revolving Credit Facility. We expect to generate cash flows from operations to fund our business and use those funds, and our Credit Facility, to meet our short-term liquidity requirements, which we define as those arising within the next twelve months, and our long-term liquidity requirements, which we define as those beyond the next twelve months.

Previous wording

Debt, excluding our warehouse facilities, consisted of the following as of September 30, 2024 and December 31, 2023 (in thousands):

Current wording

The carrying value of our debt, excluding our warehouse facilities, consisted of the following as of March 31, 2025 and December 31, 2024 (in thousands):

Previous wording

During thenine months ended September 30, 2024, there were $235.0 million of borrowings and $60.0 million of repayments under the Credit Facility. As of September 30, 2024, there were $175.0 million of borrowings outstanding under the Credit Facility. As of September 30, 2024, borrowings under the Credit Facility carried an interest rate of 6.81%, with a weighted-average interest rate of 6.91% for thenine months ended September 30, 2024. As of December 31, 2023, there were no borrowings under the Credit Facility.

Current wording

During thethree months ended March 31, 2025, there were $115.0 million of borrowings and $15.0 million of repayments under the Credit Facility. As of March 31, 2025, there were $175.0 million of borrowings outstanding under the Credit Facility. As of March 31, 2025, borrowings under the Credit Facility carried an interest rate of 5.92%, with a weighted-average interest rate of 5.92% for thethree months ended March 31, 2025. As of December 31, 2024, there were no borrowings under the Credit Facility.

Previous wording

As of September 30, 2024, Newmark had $1.5 billion of committed loan funding, $1.1 billion of uncommitted loan funding available through three commercial banks, and an uncommitted $400.0 million Fannie Mae loan repurchase facility. Consistent with industry practice, these warehouse facilities are short-term, requiring annual renewal. These warehouse facilities are collateralized by an assignment of the underlying mortgage loans originated under various lending programs and third-party purchase commitments and are recourse only to our wholly owned subsidiary, Berkeley Point Capital, LLC. As of September 30, 2024 and December 31, 2023 we had $1.0 billion and $0.5 billion, respectively, outstanding under “Warehouse facilities collateralized by U.S. Government Sponsored Enterprises” on our accompanying unaudited condensed consolidated balance sheets.

Current wording

As of March 31, 2025, Newmark had $1.5 billion of committed loan funding, $1.1 billion of uncommitted loan funding available through three commercial banks, and an uncommitted $500.0 million Fannie Mae loan repurchase facility. Consistent with industry practice, these warehouse facilities are short-term, requiring annual renewal. These warehouse facilities are collateralized by an assignment of the underlying mortgage loans originated under various lending programs and third-party purchase commitments and are recourse only to our wholly owned subsidiary, Berkeley Point Capital, LLC. As of March 31, 2025 and December 31, 2024 we had $0.8 billion and $0.8 billion, respectively, outstanding under “Warehouse facilities collateralized by U.S. Government Sponsored Enterprises” on our accompanying unaudited condensed consolidated balance sheets.

Previous wording

Total lease liability as of September 30, 2024 was $640.8 million. Of the total amount, $157.0 million of lease liability is within our flexible workspace business whereby the liability is ring-fenced in SPVs with only $36.6 million of guarantees and/or letters of credit with exposure to Newmark. In addition, Newmark had contracted future customer revenues and sub-lease income as of September 30, 2024 amounting to approximately $197.9 million.

Current wording

Total lease liability as of March 31, 2025 was $608.4 million. Of the total amount, $137.5 million of lease liability is within our flexible workspace business whereby the liability is ring-fenced in SPVs with only $20.5 million of guarantees and/or letters of credit with exposure to Newmark. There was an additional $10.0 million of guarantees and/or letters of credit related to lease liabilities not in consolidated SPVs. In addition, Newmark had contracted future customer revenues and sub-lease income as of March 31, 2025 amounting to approximately $177.1 million.

Previous wording

(1) Includes loans, forgivable loans and other receivables from employees and partners in the amount of $209.8 million and $209.6 million for the nine months ended September 30, 2024 and 2023, respectively. Excluding these loans, net cash provided by operating activities excluding loan originations and sales would be $266.2 million and $202.3 million for the nine months ended September 30, 2024 and 2023, respectively.

Current wording

(1) Includes loans, forgivable loans and other receivables from employees and partners in the amount of $117.7 million and $161.1 million for the three months ended March 31, 2025 and 2024, respectively. Excluding these loans, net cash provided by (used in) operating activities excluding loan originations and sales would be $(8.7) million and $59.8 million for the three months ended March 31, 2025 and 2024, respectively.

Previous wording

Cash Flows for the Nine Months Ended September 30, 2024

Current wording

Cash Flows for the Three Months Ended March 31, 2025

Previous wording

For the nine months ended September 30, 2024, we used $412.5 million of cash in operations. Excluding activity from loan originations and sales, cash used in operating activities for the nine months ended September 30, 2024 was $56.4 million. Cash used in operations included $209.8 million of loans, forgivable loan and other receivables from employees and partners primarily for the hiring of revenue generating professionals. Cash used in investing activities was $27.3 million, consisting primarily of cash paid for the purchases of fixed assets. Cash provided by financing activities of $465.4 million primarily related to net borrowings of $225.0 million of corporate debt and net proceeds from warehouse facilities of $487.2 million. This was offset by treasury stock repurchases and unit purchases of $193.5 million, payments to shareholders and partners for dividends and distributions of $47.9 million, and payments of deferred financing costs of $5.4 million.

Current wording

For the three months ended March 31, 2025, we used $179.4 million of cash in operations. Excluding activity from loan originations and sales, cash provided by operating activities for the three months ended March 31, 2025 was $126.4 million. Cash used in operations included $122.3 million of loans, forgivable loans and other receivables from employees and partners primarily for the hiring of revenue generating professionals. Cash used in investing activities was $5.4 million, consisting of cash paid for the purchases of fixed assets. Cash provided by financing activities of $147.6 million primarily related to net borrowings of $100.0 million of corporate debt and net proceeds from warehouse facilities of $66.9 million. This was offset by payments to shareholders and partners for dividends and distributions of $18.3 million.

Previous wording

Cash Flows for the Nine Months Ended September 30, 2023

Current wording

Cash Flows for the Three Months Ended March 31, 2024

Previous wording

For the nine months ended September 30, 2023, we used $485.9 million of cash from operations. Excluding activity from loan originations and sales, cash used from operating activities for the nine months ended September 30, 2023 was $7.3 million. Cash used in investing activities was $38.2 million, consisting of cash paid for acquisitions and purchases of fixed assets. Cash provided by financing activities of $444.5 million primarily related to $55.0 million of net Credit Facility borrowings, and net principal borrowings on warehouse facilities of $472.1 million.

Current wording

For the three months ended March 31, 2024, we used $68.8 million of cash in operations. Excluding activity from loan originations and sales, cash used in operating activities for the three months ended March 31, 2024 was $101.3 million. Cash used in operations included $161.1 million of loans, forgivable loan and other receivables from employees and partners. Cash used in investing activities was $7.4 million, consisting of cash paid for the purchases of fixed assets. Cash provided by financing activities of $56.1 million primarily related net borrowings of $125.0 million of corporate debt, offset by treasury stock repurchases and payments to shareholders and partners for dividends and distributions.

Previous wording

On October 23, 2024, Cantor purchased from Newmark Holdings an aggregate of (i) 500,617 exchangeable limited partnership interests for aggregate consideration of $1,824,045 as a result of the redemption of 500,617 Founding Partner interests, and (ii) 162,086 exchangeable limited partnership interests for aggregate consideration of $506,022 as a result of the exchange of 162,086 Founding Partner interests. Following such purchase, there were no Founding Partner interests in Newmark Holdings remaining in which the partnership had the right to redeem or exchange and with respect to which Cantor had the right to purchase an equivalent number of Cantor Units following such redemption or exchange.

Current wording

As of May 9, 2025, there were 384,738 Founding Partner interests in Newmark Holdings remaining in which Newmark Holdings had the right to redeem or exchange and with respect to which Cantor had the right to purchase an equivalent number of Cantor Units following such redemption or exchange. See Note 23 — “Related Party Transactions Cantor Rights to Purchase Cantor Units from Newmark Holdings” to our accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information regarding Cantor’s rights to purchase Cantor Units pursuant to the terms of the Newmark Holdings limited partnership agreement.

Previous wording

See “—Regulation” in Part I, Item 1, Business, of the Annual Report on Form 10-K for the year ended December 31, 2023, for information related to our regulatory environment.

Current wording

See “—Regulation” in Part I, Item 1, “Business,” of our Annual Report on Form 10-K for the year ended December 31, 2024, for information related to our regulatory environment.

Previous wording

Our fully diluted weighted-average share counts for the nine months ended September 30, 2024 and 2023 were as follows (in thousands):

Current wording

Our fully diluted weighted-average share counts for the three months ended March 31, 2025 and 2024 were as follows (in thousands):

Previous wording

(1)Common stock consisted of Class A shares and Class B shares. For the nine months ended September 30, 2024, the weighted-average number of Class A shares was 151.5 million shares and Class B shares was 21.3 million that were included in our fully diluted EPS computation.

Current wording

(1)Common stock consisted of Class A shares and Class B shares. For the three months ended March 31, 2025, the weighted-average number of Class A shares was 155.1 million shares and Class B shares was 21.3 million that were included in our fully diluted EPS computation.

Previous wording

(2)Partnership units collectively include FPUs, limited partnership units, and Cantor Units (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings” to our accompanying unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information). In general, these partnership units are potentially exchangeable into shares of Newmark Class A common stock. In addition, the partnership units held by Cantor as of September 30, 2024 are generally exchangeable into up to 24.9 million shares of Newmark Class A common stock and/or Newmark Class B common stock. These partnership units also generally receive quarterly allocations of net income, after the deduction of the Preferred Distribution, based on their weighted-average pro rata share of economic ownership of the operating subsidiaries. As a result, these partnership units are included in the fully diluted share count calculation shown above.

Current wording

(2)Partnership units collectively include FPUs, limited partnership units, and Cantor Units (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings” to our accompanying unaudited condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q for more information). In general, these partnership units are potentially exchangeable into shares of Newmark Class A common stock. In addition, the partnership units held by Cantor as of March 31, 2025 are generally exchangeable into up to 18.3 million shares of Newmark Class A common stock and/or Newmark Class B common stock. These partnership units also generally receive quarterly allocations of net income, after the deduction of the Preferred Distribution, based on their weighted-average pro rata share of economic ownership of the operating subsidiaries. As a result, these partnership units are included in the fully diluted share count calculation shown above.

Previous wording

(3)For the nine months ended September 30, 2024, the weighted-average share count included 0.3 million anti-dilutive securities, which were excluded in the computation of fully diluted earnings per share. For the nine months ended September 30, 2023, the weighted-average share count included 4.8 million anti-dilutive securities, which were excluded in the computation of fully diluted earnings per share.

Current wording

(3)For the three months ended March 31, 2025 and 2024, the weighted-average share count included 79.0 million and 81.1 million, respectively, anti-dilutive securities, which were excluded in the computation of fully diluted earnings per share.

Previous wording

We have an effective registration statement on Form S-4 with respect to the offer and sale of up to 20.0 million shares and rights to acquire shares of our Class A common stock from time to time in connection with business combination transactions, including acquisitions of other businesses, assets, properties or securities. As of September 30, 2024, we have issued 2.5 million shares of our Class A common stock under this registration statement.

Current wording

We have an effective registration statement on Form S-4 with respect to the offer and sale of up to 20.0 million shares and rights to acquire shares of our Class A common stock from time to time in connection with business combination transactions, including acquisitions of other businesses, assets, properties or securities. As of March 31, 2025, we have issued 2.7 million shares of our Class A common stock under this registration statement.