NEWMARK GROUP, INC.

Previous wording

This discussion summarizes the significant factors affecting our results of operations and financial condition during the three months ended March 31, 2026 and 2025. 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 and six months ended June 30, 2026 and 2025. 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

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.

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 secular and cyclical industry trends, macroeconomic dynamics, and our investments in growth. These factors are discussed below.

Previous wording

Key Business Drivers. The key drivers of our business include our ability to attract and retain revenue generating headcount across our service lines, the productivity of these employees, and industry volumes in these areas. Volumes are largely a factor of economic and job growth, interest rates, and the demand for commercial real estate as an investment and for debt financing. In addition, demand for our services is influenced by secular trends with respect to outsourcing and other services we provide.

Current wording

Key Business Drivers. The key drivers of our business include our ability to attract and retain revenue generating headcount across our service lines, the productivity of these employees, and industry volumes in these areas. Volumes are largely a factor of economic and job growth, interest rates, the demand for commercial real estate as an investment, and the need for related debt and equity financing. Demand for our services is also influenced by secular trends with respect to outsourcing and other services we provide.

Previous wording

Attracting and Retaining Revenue-Generating Headcount. Over the twelve months ended March 31, 2026, we continued to solidify what we believe is our position as the platform of choice for many top professionals. In countries including the U.S., U.K., France, Germany, India, Italy, South Korea, and Singapore, we attracted some of the most prolific and experienced client-facing professionals. 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. Our revenue-generating headcount across Capital Markets, Leasing and Other Commissions, and V&A in the U.S. was flat or up modestly year-on-year on a net basis over the last several quarters. Therefore, strong gains in revenue per average producer and appraiser were the primary driver of our double-digit year-on-year U.S. commission-based revenue growth. We increased both the number of non-U.S. offices and our international revenue-generating headcount by mid-double-digit percentages year-on-year in the first quarter of 2026. As with nearly all newly hired professionals, these recent additions are expected to take at least 6 to 18 months to produce meaningful fees, although we generally record related expenses beginning in their first quarter with the Company. As more of Newmark’s newer team members ramp up, we expect to further improve our productivity and earnings over time, all else equal.

Current wording

Attracting and Retaining Revenue-Generating Headcount. Over the twelve months ended June 30, 2026, we continued to solidify what we believe is our position as the platform of choice for many top professionals. We continue to attract some of the most prolific and experienced client-facing professionals in countries including the U.S., U.K., France, Germany, India, Italy, South Korea, Canada, and Singapore. We believe that these additions further demonstrate the strength of our global brand, and the value of our substantial investments in data analytics, technology, and talent. Our revenue-generating headcount in the U.S. was flat or up modestly year-on-year on a net basis over the last several quarters. Therefore, strong productivity gains were the primary driver of our double-digit percentage year-on-year U.S. revenue growth in second quarter and first half of 2026. We increased both the number of non-U.S. offices and our international revenue-generating headcount by mid-double-digit percentages year-on-year in the second quarter of 2026. As with nearly all newly hired professionals, these recent additions are expected to take at least 6 to 18 months to produce meaningful fees, although we generally record related expenses beginning in their first quarter with the Company. As more of Newmark’s newer team members ramp up, we expect to further improve our productivity and earnings over time, all else equal.

Previous wording

Continued Trends with Respect to Management Services, Servicing Fees and Other. Many of our Management Services offerings continue to benefit from increased outsourcing by corporations and other occupiers, owners of real estate, lenders, and investment funds. We expect these outsourcing trends to persist for the foreseeable future, which should benefit our recurring revenue businesses as we continue to invest in areas including property, project, and facilities management, as well across our growing suite of managed services offerings. Between September 2025 and March 2026, our investments in recurring revenue businesses include the Company’s acquisitions of the Altus appraisal platform, Catella, and RealFoundations, as well as the organic launches of our property and facilities management businesses in India and our new fund administration service line. We believe these newest offerings in Management Services, Servicing Fees and Other will help drive stable and predictable revenue and earnings growth over time.

Current wording

Continued Trends with Respect to Management Services, Servicing Fees and Other. Many of our Management Services offerings continue to benefit from increased outsourcing by corporations and other occupiers, owners of real estate, lenders, and investors. We expect these outsourcing trends to persist for the foreseeable future, which should benefit our recurring revenue businesses as we continue to invest in areas including property, project, and facilities management, as well across our growing suite of managed services offerings. Between September 2025 and June 2026, our investments in recurring revenue businesses include the Company’s acquisitions of the Altus Appraisal platform, Catella, and RealFoundations, as well as the organic launches of our property and facilities management businesses in India and our new fund administration service line. We believe these recent investments will help drive stable and predictable revenue and earnings growth over time.

Previous wording

Additionally, we operate a high margin and growing loan servicing and asset management business focused on GSE/FHA loans, as well as on bank, private credit, and commercial mortgage-backed securities clients. We expect this business to benefit as the overall amount of commercial and multifamily debt outstanding increases, we continue to gain origination market share, and we drive further cross selling between service lines. As of March 31, 2026, our overall loan servicing and asset management portfolio grew by 14.2% year-on-year to a record $222.1 billion (of which 64.8% was limited servicing and asset management, 35.2% was higher margin primary servicing, and 0.7% was special servicing). We expect our overall portfolio to continue providing a steady stream of income and cash flow over the life of the serviced loans.

Current wording

Additionally, we operate a high margin and growing loan servicing and asset management business focused on GSE/FHA loans, as well as on bank, private credit, and commercial mortgage-backed securities clients. We expect this business to benefit as the overall amount of commercial and multifamily debt outstanding increases, we continue to gain origination market share, and we drive further cross selling between service lines. As of June 30, 2026, our overall loan servicing and asset management portfolio grew by 20.5% year-on-year to $219.3 billion (of which 62.2% was limited servicing and asset management, 37.0% was higher margin primary servicing, and 0.7% was special servicing). We expect our overall portfolio to continue providing a steady stream of income and cash flow over the life of the serviced loans.

Previous wording

These factors, combined with our ability to increase revenue synergies between our service lines, enabled us to grow Management Services, Servicing Fees and Other revenues by a double digit CAGR between 2017 and 2026, and to increase these recurring revenues by 21.2% in the first quarter ended March 31, 2026.

Current wording

These factors, combined with our ability to increase revenue synergies between our service lines, enabled us to grow Management Services, Servicing Fees and Other revenues by an approximately 16% CAGR between 2017 and 2025, and to increase these recurring revenues by 17.7% year-on-year in the quarter ended June 30, 2026.

Previous wording

According to a preliminary estimate by the Bureau of Economic Analysis, U.S. GDP increased 2.0% in the first quarter of 2026, after having expanded 2.1% in 2025 and 2.8% in 2024. According to the Wall Street Journal, U.S. GDP growth was once again led by increased capital expenditures on categories closely tied to artificial intelligence, which may have contributed approximately half of all GDP growth in the quarter, and resulted in overall business investment expanding by more than 10% annualized. While U.K. GDP for the quarter has not yet been released, the consensus is for it to grow by 0.6% year-on-year, after having expanded 1.4% in 2025 and 1.1% in 2024.

Current wording

According to a preliminary estimate by the Bureau of Economic Analysis, U.S. GDP increased at an annualized rate of 1.5% in the second quarter of 2026, after having expanded 2.1% in 2025 and 2.8% in 2024. According to the Wall Street Journal, U.S. GDP growth was led by increased capital expenditures on categories closely tied to AI, which may have contributed more than half of all GDP growth in the quarter. While higher consumer spending also contributed to the rise, these factors were partially offset by lower federal spendings, private inventory investment, nonresidential structure investment, and net exports. While U.K. GDP for the quarter has not yet been released, the consensus is for it to grow by 0.2% year-on-year, after having expanded 1.3% in 2025 and 1.1% in 2024.

Previous wording

According to a preliminary estimate by the Bureau of Labor Statistics, the seasonally adjusted monthly average of U.S. non-farm payroll employment increased by approximately 63,000 in the first quarter of 2026. In comparison, the monthly average grew by 10,000 and 122,000 in full years 2025 and 2024. The March 2026 U.S. unemployment rate (based on U-3) was unchanged versus a year earlier at 4.3% compared with 4.1% a year earlier. Per the Office for National Statistics, the comparable U.K. unemployment rate as of February 2026 (the most recent data available) was 4.9% versus 4.3% a year earlier.

Current wording

According to a revised estimate by the Bureau of Labor Statistics, the seasonally adjusted monthly average of U.S. non-farm payroll employment increased by approximately 77,000 in the second quarter of 2026. In comparison, the monthly average grew by 10,000 and 122,000 in full years 2025 and 2024. The June 2026 U.S. unemployment rate (based on U-3) was 4.2% compared with 4.1% a year earlier. Per the Office for National Statistics, the comparable U.K. unemployment rate as of May 2026 (the most recent data available) was 4.9% versus 4.7% a year earlier.

Previous wording

The ten-year U.S. Treasury yield increased by approximately 150 basis points quarter-on-quarter and by 111 basis points year-on-year to 4.3% as of March 31, 2026. The ten-year U.K. Gilt yield increased by approximately 439 basis points quarter-on-quarter and by 241 basis points year-on-year to 4.9% over the same timeframe. The increases are mainly due to the sharp rise in prices for oil, natural gas, and other commodities due to the Middle East conflict. For context, ten-year U.S. Treasury and ten-year U.K. Gilt yields still remain below their 50-year average through December 31, 2025 of approximately 5.8% and 7.0%, respectively.

Current wording

The ten-year U.S. Treasury yield increased by approximately 150 and 240 basis points quarter-on-quarter and year-on-year, respectively to 4.7% as of June 30, 2026. The ten-year U.K. Gilt yield declined by approximately 160 basis points quarter-on-quarter and increased by nearly 270 basis points year-on-year to 4.8% over the same timeframe. The year-on-year increases are mainly due to the sharp rise in prices for oil, natural gas, and other commodities due to the recent Middle East conflict and the closure of or disruption to the Strait of Hormuz. For context, ten-year U.S. Treasury and ten-year U.K. Gilt yields still remain below their 50-year average through December 31, 2025 of approximately 5.8% and 7.0%, respectively.

Previous wording

For the month ending March 31, 2026, the most commonly cited U.S. and U.K. inflation measures were up 3.3% and 3.4%, respectively, versus a year earlier. They have both been higher than the 2% targets set by both the FOMC and MPC since June, 2021, and headline inflation in both countries increased month over month due largely to the aforementioned increase in energy prices. The surveyed economists continue to expect inflation to remain above these targets for at least the next two calendar years. Concerns about continued U.S. GDP growth, above-target inflation, and a possibly stagnant job market may present a challenge to the FOMC's dual mandate. This have reduced clarity in terms of how fast the central bank will lower short term rates. The U.K. has experienced many of these same issues, albeit with lower GDP and labor productivity growth and higher inflation. As a result, both economists and the futures markets expect short-term yields in both countries to be higher for the foreseeable future. The futures market is currently pricing in zero short term benchmark rate cuts in the U.S. through the middle of 2027, and expects a slight increase in such rates in the U.K. and Eurozone by the first quarter of next year.

Current wording

For the month ending June 30, 2026, the U.S. and U.K. consumer price indices were up 3.5% and 2.8%, respectively, versus a year earlier. Inflation has both been higher than the 2% targets set by both the FOMC and MPC since June 2021, and the headline figures in both countries have been elevated in recent months due largely to the aforementioned increase in energy prices. The surveyed economists continue to expect inflation to remain above these targets for at least the next two calendar years. Concerns about continued U.S. GDP growth, above-target inflation, and a potentially slowing job market may present a challenge to the FOMC's dual mandate. This has led more economists to expect the central bank to either maintain or possibly raise short term rates in the near term. The U.K. has experienced many of these same issues, albeit with lower GDP and labor productivity growth and, in most recent periods, higher inflation. As a result, both economists and futures markets expect short-term yields in both countries to be higher for the foreseeable future. The futures market is currently pricing in moderate short term benchmark rate hikes in the U.S., U.K., and Eurozone through at least the second quarter of 2027.

Previous wording

Despite the possibility of flat or rising short term rates, other metrics that are inversely correlated with easier availability of credit for real estate investors remain well below their five year averages in the U.S., and at or below average in the U.K. and Eurozone. We believe this is most positive for commercial real estate capital markets transactions in the U.S., and generally positive for them in the U.K. and Eurozone. These metrics include interest rate volatility as measured by the ICE BofA MOVE Index and credit spreads as indicated by the Bloomberg U.S. Corp BBB/Baa - Treasury 10 Year Spread, as well as similar metrics with respect to the U.K. and Eurozone. Given the stable interest rate environment and historically narrow credit spreads in the U.S., we believe current market conditions remain favorable for a continued recovery of U.S. industry capital markets volumes, and to a lesser extent in the U.K. and Continental Europe. Because of Newmark's ongoing investments in talent outside the U.S., and because our recently hired international revenue generating professionals have yet to fully ramp up, we expect to gain further global market share across our commission-based businesses over the near- and medium-term.

Current wording

BofA MOVE Index and credit spreads as indicated by the Bloomberg U.S. Corp BBB/Baa - Treasury 10 Year Spread, as well as similar metrics with respect to the U.K. and Eurozone. Given relatively low interest rate volatility and narrow credit spreads in the U.S., we believe current market conditions remain favorable for a continued recovery of U.S. industry capital markets volumes, and to a lesser extent in the U.K. and Continental Europe. Because of Newmark's ongoing investments in talent, and our recently hired revenue generating professionals have yet to fully ramp up, we expect to gain further global market share across our commission-based businesses over the near- and medium-term.

Previous wording

Industry Leasing Activity. Unless otherwise stated, all industry leasing data is from Newmark Research and/or CoStar. Office remains the majority of activity for both Newmark and the industry.

Current wording

Industry Leasing Activity. Unless otherwise stated, all industry leasing data is from Newmark Research and/or CoStar, is preliminary, and is subject to possible future revisions. Office leasing remains the majority of activity for both Newmark and the industry.

Previous wording

U.S. overall office leasing activity (for deals over 10,000 square feet) totaled nearly 60 million square feet in the first quarter of 2026. This represented a 7.5% improvement year-over-year and was the best performance since the fourth quarter of 2023. The continuing recovery was geographically diverse, with New York City, San Francisco, and Dallas/Fort Worth driving much of the first quarter improvement, although San Francisco continues to have one of the highest vacancy rates among major U.S. markets. Artificial intelligence and other technology companies have become a strong driver of office demand, concentrated in key hubs like San Francisco, New York City, Seattle, Los Angeles, and Austin. With respect to the U.K., London has led the recovery in demand for office space, including from artificial intelligence firms and other technology companies. Net absorption in London has been strongly positive in recent quarters, which largely offset negative absorption in the rest of the U.K. Given improving demand, the overall U.K. office vacancy rate may have peaked in the first quarter of 2026 at 9.1%. With the pipeline of new office construction expected to drop off dramatically beginning this year in Newmark's key markets, the ongoing enhancement of Class B office properties, and the conversion of obsolete space into multifamily and other uses, we expect office fundamentals to continue to improve.

Current wording

U.S. industry office leasing activity (for deals over 10,000 square feet) totaled just over 55 million square feet in the second quarter of 2026. This represented a 9.1% improvement year-over-year, but was roughly 30% below the average for 2018 and 2019. The continuing recovery was geographically diverse, led by New York and San Francisco. This was the 13th consecutive quarter with activity above 3 million square feet in New York City, while it was the third highest quarterly total on record for San Francisco. However, the latter continues to have one of the highest vacancy rates among major U.S. markets. AI and other technology companies have become a strong driver of office demand, concentrated in key hubs like New York and San Francisco, as well as Seattle, Los Angeles, and Austin. With respect to the U.K., London continues to lead the country in demand for office space, including from AI firms and other technology companies, as well as companies in financial services, retail, consulting, and legal services. Office leasing volumes for London increased by approximately 10% year-on-year in the second quarter of 2026. With the pipeline of new U.S. office construction down 85% from the early 2020 peak and U.K. office starts at or near all time lows, and the conversion of obsolete space into multifamily and other uses, we expect office fundamentals to continue to improve in our key markets.

Previous wording

We expect demand for office space to continue to be supported by the reset in values due to near-term debt maturities. We also continue to see increased need for high quality office space in an increasing number of markets, led by ongoing return-to-workplace plans. Placer.ai data for March 2026 indicates that in-person attendance in the U.S. increased to an average of 73.5% of March 2019 pre-pandemic levels versus 66.0% a year earlier. This represented a year-on-year improvement in attendance of 11.4%. According to this same source, Miami and New York were both above 90% of pre-pandemic levels, while Los Angeles and San Francisco posted the strongest year-on-year growth in attendance.

Current wording

We expect demand for office space to continue to be supported by the reset in values due to near-term debt maturities. We also continue to see increased need for high quality office space in an increasing number of markets, led by ongoing return-to-workplace plans. Placer.ai data for June 2026 indicates that in-person attendance in the U.S. increased to an average of 75.2% of June 2019 pre-pandemic levels versus 72.8% a year earlier, all on per working day basis. June was the best post-pandemic month in terms of nationwide attendance relative to the same month in 2019. According to this same source, Miami exceeded pre-pandemic levels by 2.7 percentage points, while every other major metropolitan area in the U.S. improved year-on-year, with Los Angeles and San Francisco showing the largest gains. In the U.K., data from Remit Consulting indicate that office attendance in June 2026 reached its highest level since the pandemic began.

Previous wording

New U.S. industrial leasing activity continued its momentum in the first quarter of 2026, growing by more than 12% year-on-year, led by large modern warehouses and distribution centers. This represented the best quarter of new leasing volume since the third quarter of 2022. Tenants in many metropolitan areas are upgrading to newer facilities, and there was a notable uptick in industrial leasing related to data center development in certain markets. The national industrial vacancy rate fell 6 basis points quarter-over-quarter, the first vacancy decline since 2022, signaling that the market may be near peak vacancy. With respect to the U.K., industrial vacancy improved for the third consecutive period to 7.3% in the first quarter of 2026, while leasing volume increased by 3% sequentially and by 8% year-on-year. Leasing demand was driven by e-commerce retailers, supermarkets, food companies, automotive-related occupiers, and construction suppliers. Speculative development for the twelve months ending March 31, 2026, was the lowest in terms of square feet since the twelve months ending September 30, 2020, which should continue to support prime headline rents in the U.K.

Current wording

New U.S. industrial leasing activity continued its momentum in the second quarter of 2026, growing by nearly 29% versus the second quarter of 2025. While it was a relatively easy year-on-year comparison, this was the best quarter of new industrial leasing volume since the third quarter of 2022, led by large modern warehouses and distribution centers. Tenants in many markets are upgrading to newer facilities, and there was a notable uptick in industrial leasing related to data center development in certain markets. The national industrial vacancy rate fell for the second consecutive quarter, signaling the market is past peak vacancy. With respect to the U.K., industrial vacancy fell for the fourth consecutive period to 7.0% in the second quarter of 2026. Occupier activity in the second quarter was led both by new overseas entrants to the U.K. and by domestic firms, particularly those aligned with e-commerce and defense. Speculative development activity remained low in the second quarter of 2026 and far below the five year average, which should continue to support prime headline rents in the U.K.

Previous wording

U.S. retail leasing activity for centers and properties of at least 20,000 square feet fell to 27.5 million square feet in the first quarter of 2026, which was approximately 33% below the trailing ten-year average. Retailers continue to find it difficult to locate space in prime assets, as retail centers built from the year 2000 onward remain in high demand with a national occupancy rate above 97%. Among major markets, Dallas-Fort Worth, Phoenix, and Houston remain the most active. However, at just 5.3%, the overall U.S. retail vacancy rate remains approximately 1.2 percentage points below the long-term average as of March 31, 2026.

Current wording

U.S. retail leasing activity for centers and properties of at least 20,000 square feet fell to 27.5 million square feet in the second quarter of 2026, which was approximately 34% below the trailing ten-year average. Among major markets, Dallas-Fort Worth, Phoenix, and Houston remain the most active. With limited new construction, occupiers continue to have difficulty finding suitable locations. The 8.4 million square feet of positive net absorption, along with a limited number of move-outs, reduced the overall U.S. vacancy rate to 5.2%, which is 1.3 percentage points below the long-term average as of June 30, 2026. Retail properties built from 2000 onward remain the most desirable, with a national availability rate below 3%. In the U.K., retail has entered a more stable phase after its long correction, with annual rental growth positive since 2023 and vacancy now trending downwards.

Previous wording

Against this improving market backdrop, Newmark’s revenues from Leasing and Other Commissions increased by 20.2% for the quarter ended March 31, 2026.

Current wording

Against this generally improving market backdrop, Newmark’s revenues from Leasing and Other Commissions increased by 17.2% for the quarter ended June 30, 2026.

Previous wording

Industry Capital Markets Activity. We believe that we once again gained share in Capital Markets in the first quarter of 2026, while overall industry volumes continued to improve. For example, based on their analysis of the most recently available data from MSCI and/or the MBA, Newmark Research estimates that U.S. notional investment sales volumes were up by approximately by 33% and 28%, respectively, year-on-year in the three and twelve months ending March 31, 2026. Activity improved by double digit percentages nationally across nearly every major property type. In comparison, Newmark's U.S. Investment Sales volumes improved by approximately 32% and 43%, respectively, year-on-year in the three and twelve months ending March 31, 2026. Preliminary MSCI data indicates that global investment sales volumes excluding the U.S. grew by at least 2% year-on-year over the twelve months ending March 31, 2026, although this source often revises such figures upwards at a later date. Due to our international investments, we grew our non-U.S. Investment Sales volumes by 65% over the same period, albeit from a lower base.

Current wording

Industry Capital Markets Activity. We believe that we continue to gain share in Capital Markets, while overall industry volumes continued to improve. For example, based on their analysis of the most recently available data from MSCI and/or the MBA, Newmark Research estimates that U.S. notional investment sales volumes were up by approximately by 28% and 29%year-on-year in the three and twelve months ending June 30, 2026, respectively. Activity improved by double digit percentages nationally across nearly every major property type. In comparison, Newmark's U.S. Investment Sales volumes improved by approximately 73% and 53% year-on-year over same respective periods. Preliminary MSCI data indicates that global investment sales volumes excluding the U.S. were up 1% year-on-year over the twelve months ending June 30, 2026, although this source often revises such figures upwards at a later date. Due to our international investments, we grew our non-U.S. Investment Sales volumes by 132% over the same trailing twelve months, albeit from a low base.

Previous wording

Based on their analysis of historical figures from the MBA and MSCI lending data, Newmark Research estimates that U.S. commercial and multifamily originations increased by 29% and 40%, respectively, in the three and twelve months ending March 31, 2026 versus a year earlier. In comparison, Newmark increased its U.S. Total Debt volumes by approximately 112% and 79%, respectively, over these same periods. While we continue to generate nearly all debt volumes in the U.S., we expect to increase our international mortgage brokerage and debt placement platform as we continue to invest in non-U.S. talent.

Current wording

Newmark faced challenging year-on-year comparisons in the second quarter of 2026 due to our approximately 135% improvement in Total Debt volumes in the year earlier period, which included the $7.1 billion AI data center construction loan related to the Stargate Project. On a trailing twelve month basis, we continued to gain share. Based on their analysis of historical figures from the MBA and MSCI lending data, Newmark Research estimates that U.S. commercial and multifamily originations increased by 21% and 37%, respectively, in the three and twelve months ending June 30, 2026 versus the year earlier periods. In comparison, Newmark’s U.S. Total Debt volumes declined by approximately 19% and grew by 43%, respectively, over these same periods.

Previous wording

From time to time, we may also enter into agreements with employees and partners to grant bonus and salary advances or other types of loans. These advances and loans are repayable in the timeframes outlined in the underlying agreements. In addition, we also enter into deferred compensation agreements with employees providing services to us. The costs associated with such plans are generally amortized over the period in which they vest. See Note 27 — “Compensation” and Note 28 —

Current wording

From time to time, we may also enter into agreements with employees and partners to grant bonus and salary advances or other types of loans. These advances and loans are repayable in the timeframes outlined in the underlying agreements. In addition, we also enter into deferred compensation agreements with employees providing services to us. The costs associated with such plans are generally amortized over the period in which they vest. See Note 27 — “Compensation” and Note 28 — “Commitments and Contingencies” to our accompanying unaudited condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q.

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 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.”

Current wording

“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

Leasing and Other Commission revenues increased by $42.0 million, or 20.2%, to $250.0 million for thethree months ended March 31, 2026 compared to the three months ended March 31, 2025, which was driven by strong activity across office, retail, and industrial.

Current wording

Leasing and Other Commission revenues increased by $40.8 million, or 17.2%, to $278.0 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025, which was driven by significantly higher office volumes in key markets including New York City, the San Francisco Bay Area, and Los Angeles.

Previous wording

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

Current wording

Other income (loss), net was $16.0 thousand and $0.2 million for the three months ended June 30, 2026 and 2025, respectively. The income for the three months ended June 30, 2025 related to recoveries from forfeited shares of restricted Newmark Class A common stock.

Previous wording

Interest expense, net decreased by $1.6 million, or 18.5%, to $6.9 million during thethree months ended March 31, 2026 compared to the three months ended March 31, 2025.

Current wording

Interest expense, net decreased by $1.6 million, or 17.8%, to $7.4 million during the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to a $1.7 million increase in interest income.

Previous wording

Management Services, Servicing Fees and Other revenues increased by $60.1 million, or 21.2%, to $344.0 million for thethree months ended March 31, 2026 compared to the three months ended March 31, 2025. This increase was led by double-digit organic growth from Valuation and Advisory, our high margin servicing and asset management platform, and Newmark’s expanding suite of other Management Services businesses. These results also benefited from recent acquisitions.

Current wording

Management Services, Servicing Fees and Other revenues increased by $112.9 million, or 19.4%, to $695.2 million for thesix months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was led by double digit percentage organic growth from Valuation and Advisory, our high margin servicing and asset management platform, and Newmark’s expanding suite of outsourcing businesses. This improvement also reflects recent acquisitions.

Previous wording

Compensation and employee benefits expense increased by $116.1 million, or 29.1%, to $515.6 million for thethree months ended March 31, 2026 compared to the three months ended March 31, 2025. The increase reflects higher commission-based revenues, expenses related to global growth initiatives and costs recorded by recently acquired companies.

Current wording

Compensation and employee benefits expense increased by $200.8 million, or 23.5%, to $1,055.3 million for thesix months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase reflects higher commission-based revenues, costs recorded by recently acquired companies, expenses related to global growth initiatives, and pass through expenses related to the growth of Newmark's Occupier Solutions and Property Management businesses.

Previous wording

Fees to related parties decreased by $1.0 million, or 10.9%, to $8.5 million for thethree months ended March 31, 2026 compared to the three months ended March 31, 2025.

Current wording

Fees to related parties decreased by $0.8 million, or 4.3%, to $16.6 million for thesix months ended June 30, 2026 compared to the six months ended June 30, 2025.

Previous wording

Depreciation and amortization for thethree months ended March 31, 2026 decreased by $0.1 million, or 0.3%, to $46.2 million compared to the three months ended March 31, 2025.

Current wording

Depreciation and amortization for thesix months ended June 30, 2026 increased by $3.2 million, or 3.6%, to $92.2 million compared to the six months ended June 30, 2025 primarily due to a $4.7 million increase in MSR amortization.

Previous wording

Other income (loss), net was $0.6 million of income for thethree months ended March 31, 2026 consisting of recoveries from forfeited shares of restricted Newmark Class A common stock.

Current wording

Other income (loss), net was $0.7 million and $1.0 million of income for thesix months ended June 30, 2026 and 2025, respectively, which consisted of recoveries from forfeited shares of restricted Newmark Class A common stock.

Previous wording

Provision for income taxes increased by$13.5 million, or 134.1%, to$3.4 million for the three months ended March 31, 2026 compared to thethree months ended March 31, 2025 primarily due to the impact of change in the level and geographic mix of pre-tax earnings and 2025 tax benefit from revaluation of deferred tax assets due to a corporate ownership change. In general, our consolidated effective tax rate can vary from period to period depending on, among other factors, the level, geographic and business mix of our earnings.

Current wording

Provision for income taxes increased by$18.9 million, or 322.7%, to$13.0 million for the six months ended June 30, 2026 compared to thesix months ended June 30, 2025 primarily due to the impact of change in the level and geographic mix of pre-tax earnings and 2025 tax benefit from revaluation of deferred tax assets due to a corporate ownership change. In general, our consolidated effective tax rate can vary from period to period depending on, among other factors, the level, geographic and business mix of our earnings.

Previous wording

Net income attributable to noncontrolling interests increased by $9.4 million, or 130.6%, to $2.2 million for thethree months ended March 31, 2026 compared to the three months ended March 31, 2025. This increase was primarily driven by higher pre-tax income.

Current wording

Net income attributable to noncontrolling interests increased by $4.4 million, or 291.9%, to $5.9 million for thesix months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was primarily driven by higher pre-tax income.

Previous wording

The primary sources of liquidity for our business are the cash on our balance sheet, cash flow provided by operations, and the $600.0 million revolving Credit Facility, which was increased to $900.0 million on April 17, 2026.

Current wording

The primary sources of liquidity for our business are the cash on our balance sheet, cash flow provided by operations, and the $900.0 million revolving Credit Facility.

Previous wording

Our future capital requirements will depend on many factors, including 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, 2026, our debt consisted of $600.0 million aggregate principal amount of 7.500% Senior Notes with a carrying amount of $597.0 million and $235.0 million outstanding under the Credit Facility with a carrying amount of $235.0 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 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 June 30, 2026, our debt consisted of $600.0 million aggregate principal amount of 7.500% Senior Notes with a carrying amount of $597.3 million and $270.0 million outstanding under the Credit Facility with a carrying amount of $270.0 million, in each case exclusive of our warehouse facilities described under “—Warehouse Facilities Collateralized by U.S. Government Sponsored Enterprises.”

Previous wording

Total assets were $5.3 billion as of March 31, 2026 and $5.0 billion as of December 31, 2025.

Current wording

Total assets were $5.2 billion as of June 30, 2026 and $5.0 billion as of December 31, 2025.

Previous wording

Total liabilities were $3.6 billion as of March 31, 2026 and $3.3 billion as of December 31, 2025.

Current wording

Total liabilities were $3.4 billion as of June 30, 2026 and $3.3 billion as of December 31, 2025.

Previous wording

As of March 31, 2026, we had cash and cash equivalents of $212.1 million. Additionally, we had $365.0 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 June 30, 2026, we had cash and cash equivalents of $259.7 million. Additionally, we had $630.0 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

On April 17, 2026, Newmark amended and restated the Credit Agreement, which among other things, increased its revolving Credit Facility to $900.0 million and extended the maturity date to April 17, 2030. The Company has the right to increase the Credit Facility to up to $1.1 billion, subject to certain conditions being met. The interest rate on any borrowing under the Credit Facility would have been approximately 5.27% as of market close on April 17, 2026.

Current wording

On April 17, 2026, Newmark amended and restated the Credit Agreement, which among other things, increased its revolving Credit Facility to $900.0 million and extended the maturity date to April 17, 2030. The Company has the right to increase the Credit Facility to up to $1.1 billion, subject to certain conditions being met.

Previous wording

During thethree months ended March 31, 2026, there were $175.0 million of borrowings and $15.0 million of repayments under the Credit Facility. As of March 31, 2026, there were $235.0 million of borrowings outstanding under the Credit Facility. As of March 31, 2026, borrowings under the Credit Facility carried an interest rate of 5.27%, with a weighted-average interest rate of 5.28% for thethree months ended March 31, 2026. As of December 31, 2025, there were $75.0 million of borrowings under the Credit Facility.

Current wording

During thesix months ended June 30, 2026, there were $285.0 million of borrowings and $90.0 million of repayments under the Credit Facility. As of June 30, 2026, there were $270.0 million of borrowings outstanding under the Credit Facility. As of June 30, 2026, borrowings under the Credit Facility carried an interest rate of 5.25%, with a weighted-average interest rate of 5.28% for thesix months ended June 30, 2026. As of December 31, 2025, there were $75.0 million of borrowings under the Credit Facility.

Previous wording

On January 12, 2024, Newmark closed its offering of $600.0 million aggregate principal amount of the 7.500% Senior Notes. The notes are general senior unsecured obligations of Newmark. Cantor purchased $125.0 million aggregate principal amount of 7.500% Senior Notes in the offering, and still holds such notes as of March 2, 2026. The Company received net proceeds from the offering of the 7.500% Senior Notes of approximately $594.7 million after deducting the initial purchasers’

Current wording

On January 12, 2024, Newmark closed its offering of $600.0 million aggregate principal amount of the 7.500% Senior Notes. The notes are general senior unsecured obligations of Newmark. Cantor purchased $125.0 million aggregate principal amount of 7.500% Senior Notes in the offering, and still holds such notes as of March 2, 2026. The Company received net proceeds from the offering of the 7.500% Senior Notes of approximately $594.7 million after deducting the initial purchasers’ discounts and estimated offering expenses. The notes bear interest at a rate of 7.500% per year, payable in cash on January 12 and July 12 of each year, commencing July 12, 2024. The 7.500% Senior Notes will mature on January 12, 2029.