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Real estate services firm Newmark (NASDAQ:NMRK) beat Wall Street’s revenue expectations in Q1 CY2025, with sales up 21.8% year on year to $665.5 million. The company expects the full year’s revenue to be around $3 billion, close to analysts’ estimates. Its non-GAAP profit of $0.21 per share was 12.9% above analysts’ consensus estimates.

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Newmark (NMRK) Q1 CY2025 Highlights:

• Revenue: $665.5 million vs analyst estimates of $611 million (21.8% year-on-year growth, 8.9% beat)

• Adjusted EPS: $0.21 vs analyst estimates of $0.19 (12.9% beat)

• Adjusted EBITDA: $89.2 million vs analyst estimates of $85 million (13.4% margin, 4.9% beat)

• The company reconfirmed its revenue guidance for the full year of $3 billion at the midpoint

• Management reiterated its full-year Adjusted EPS guidance of $1.45 at the midpoint

• EBITDA guidance for the full year is $520 million at the midpoint, above analyst estimates of $503.8 million

• Operating Margin: -2.7%, up from -4.1% in the same quarter last year

• Free Cash Flow was -$184.8 million compared to -$75.83 million in the same quarter last year

• Market Capitalization: $2.19 billion

StockStory’s Take

Newmark’s first quarter was defined by broad-based revenue gains across capital markets, leasing, and management services, as management attributed the results to both market share gains and ongoing investment in talent and service expansion. CEO Barry Gosin pointed to double-digit increases in every major business line, citing a 33% rise in capital markets and 31% growth in leasing revenues, supported by strong activity in key cities like New York and San Francisco.

Looking ahead, management reaffirmed its full-year outlook but expressed caution due to macroeconomic uncertainty, including interest rate volatility and potential tariff impacts. CFO Mike Rispoli emphasized the company’s visibility into its revenue pipeline for the first half of the year, but noted that the decision to hold guidance steady was driven by a conservative approach given external risks. Rispoli stated, “Had the macroenvironment been different, we certainly would have been considering guiding towards the higher end of the range.”

Key Insights from Management’s Remarks

Management highlighted that Newmark’s first quarter performance was led by significant volume growth and ongoing expansion into new markets and service lines. The company noted that its results outpaced broader industry trends, and that its business mix is increasingly diversified.

• Capital Markets Expansion: Capital markets revenues rose sharply, fueled by a 62.5% increase in deal volume and growth across all major property types. Management cited gains in both investment sales and origination, including a notable 40% increase in government-sponsored enterprise (GSE) and Federal Housing Administration (FHA) origination.

• Leasing Activity Rebound: Office and retail leasing volumes both recorded double-digit growth, with the San Francisco Bay Area, New York City, and Boston highlighted as especially active. Management noted no significant pullback in client decision-making, despite industry macro uncertainty.

• Management Services Diversification: Revenues in management and servicing increased for the seventh consecutive quarter, reflecting growth in areas such as fund administration, property accounting, staffing solutions, and expanded facility management. Leadership emphasized that these recurring revenue streams are becoming a larger part of the business.

• Talent Acquisition Focus: Newmark continued to prioritize strategic hires and expanding its professional base, particularly in Europe and in high-value service lines. Management indicated that hiring high-performing individuals has been more cost-effective than large-scale acquisitions, supporting both organic growth and margin improvement.

• Competitive Environment and Geographic Expansion: The company pointed to successful entry into new markets, including Germany, and highlighted its ability to attract experienced professionals as a differentiator. Management sees continued growth opportunities in both U.S. and international markets, despite competitive recruiting pressures.