Newmark Group (NMRK) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenues rose 8.1% year-over-year to $633.4M, with all growth organic and driven by strong capital markets, management, servicing, and leasing performance.

• Adjusted EBITDA increased 18.3% to $86.3M, and Adjusted EPS grew 22.2%, reflecting strong operating leverage.

• Ranked #1 U.S. office broker for H1 2024 with over 30% market share; significant market share gains in capital markets and investment sales.

• Management remains focused on expanding recurring revenue streams, cross-selling, and international growth.

• Added top talent globally in affordable housing, debt, investment sales, leasing, and valuation.

Financial highlights

• Q2 2024 total revenues: $633.4M, up 8.1% year-over-year; Adjusted EBITDA: $86.3M, up 18.3%; Adjusted EPS: $0.22, up 22.2%.

• GAAP net income for fully diluted shares was $20.6M, up 132.6% year-over-year; fully diluted EPS: $0.08.

• Capital markets revenue up 14.5%, investment sales fees up 18.2%, and mortgage brokerage and debt placement fees up 46.2%.

• Management services, servicing, and other revenues up 9.2% year-over-year, led by Valuation & Advisory and GCS.

• Office leasing revenues increased nearly 16%, with overall leasing revenues up 2.4%.

Outlook and guidance

• 2024 guidance reiterated: total revenues expected to grow 3–7%, Adjusted EBITDA and Adjusted EPS both up 5–9%.

• Management expects sequential earnings improvement in 2H 2024 and continued organic growth in management and servicing.

• Targeting 50% EBITDA growth by 2026, with $3B+ revenues and $630M+ Adjusted EBITDA.

• Annual share count growth targeted at 2% or less; expects 2–3% growth in 2024 due to RSU recognition.

• Adjusted Earnings tax rate expected at 15–18% for 2024.