Newmark Group Inc Q2 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Mitchell Germain - Citizens - Analyst : Thank you and congrats on the quarter. Barry, obviously you referenced the global investment sales number three, and obviously you're making investments outside the US. I'm curious how the opportunity in Germany has been transpiring to date.

Question: Mitchell Germain - Citizens - Analyst : Great, thanks for that. Do you think the capital markets activity is sustainable, or are you seeing maybe a little bit of a pull forward given some of the future uncertainty?

Question: Mitchell Germain - Citizens - Analyst : Great, thanks for that. And then just some thoughts on capital allocation. Mike, you talked about some of the free cash flow growth. You bought back shares, but we've obviously seen a rallies 25% plus since you did that. So, where is investment dollars? Obviously they're going to new broker acquisitions, but could we potentially see you guys consider some M&A here? Is buyback still on the table? Some thoughts around that, please?

Question: Mitchell Germain - Citizens - Analyst : Thank you. I appreciate it and great quarter. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 30, 2025 / 2:00PM, NMRK.OQ - Q2 2025 Newmark Group Inc Earnings Call

Question: Alexander Goldfarb - Piper Sandler - Analyst : Hey, good morning down there, and Barry, thanks for the opening comments, just obviously tragic, Mike, appreciate the free cash flow emphasis in the slide, I think it's very helpful to help, understand the economics of the business which, this quarter just really impressive. Along those lines, data centres have been, huge in the news. Clearly, Barry, you've spoken before that it's been a focus of the company, but I think in prior comments you talked about keeping it restrained, like using the example. I think it was you or one of your colleagues use the example of like life science which boomed and then cooled off dramatically so. As you look at data centres today, is the view still that it's akin to life science in the sense that right now that area is booming, but you want to keep, your personnel, appropriately staffed versus it's more enduring, in which case there's room to expand and invest further in your data centre offering.

Question: Alexander Goldfarb - Piper Sandler - Analyst : Okay, and the second question is--

Question: Alexander Goldfarb - Piper Sandler - Analyst : Okay, the second question is, in your leasing [stats], San Francisco led, more so than New York and just want to get some more perspective on that is that. Our sense of market visits is that AI is a small part but growing, but the larger tech companies still have too much space. So, curious what's driving your business is it that you're advising tech in resizing their business, or is AI just booming a lot more than we anticipated? Just want to understand better the drivers of the dramatic booming in your San Francisco leasing growth.

Question: Alexander Goldfarb - Piper Sandler - Analyst : Thank you.

Question: Jason Sampson - KBW - Analyst : Hi, this is actually Jason Sampson on for Jade. First, I just want to say congrats on the strong quarter. In your presentation, you provided a revenue target for management services for 2029. We applaud the long-term view. And are there any other 2029 targets that you're thinking about in terms of total revenue, capital markets, leasing, or adjusted for cash flow? Thanks.

Question: Jason Sampson - KBW - Analyst : Great, thank you. And to touch on data centres first, could you provide more colour on your deal on what your deal flow looks like and as well as fee ranges on those deals, specifically if you broker a new development capitalization, what are fees earned and are those negotiated in dollars or as a commission rate?

Question: Jason Sampson - KBW - Analyst : Great, thank you. And then to pivot to capital markets and leasing, what growth rates do you expect are reasonable to see in the second half?

Question: Jason Sampson - KBW - Analyst : Great, thank you.

Question: Julian Blouin - Goldman Sachs - Analyst : Thank you for the question and congrats on another strong quarter I guess digging into a little bit more into those comments around the pipeline I guess as we look into July does it feel like there was sort of a re-acceleration in activity relative to what seemed to be a slower May and June for the industry?

Question: Julian Blouin - Goldman Sachs - Analyst : Got it. That's helpful. And it sounds like there wasn't any change to sort of how you're thinking about the 2026 targets. I guess, do you, is it just that you feel even more confident that they're sort of what you've put out there of $1.75 and $630 million of adjusted EBITDA are achievable or was there any temptation to maybe increase those targets?

Question: Julian Blouin - Goldman Sachs - Analyst : Got it. That makes sense and maybe one last one, just in New York City, I'm wondering if you're sort of expecting or seeing any impacts from the, mayoral race there, when you talk to your teams or your clients are you seeing any signs of caution from buyers, in Manhattan it looked like New York City property sales volumes were maybe a little subdued in June, wondering if there's anything to read into there.

Question: Julian Blouin - Goldman Sachs - Analyst : Okay great thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 30, 2025 / 2:00PM, NMRK.OQ - Q2 2025 Newmark Group Inc Earnings Call

Question: Patrick O'Shaughnessy - Raymond James - Analyst : Hey, good morning. So, with the new disclosure your adjusted for cash flow, do you, what are your expectations in terms of adjusted fee cash flow in 2025 and I guess bigger picture or longer term to you kind of have a framework in terms of like targeted conversion ratio, what that cash flow should look like as compared to your adjusted net income?

Question: Patrick O'Shaughnessy - Raymond James - Analyst : Yeah, that's very helpful. Speaking of hiring talent, with industry broker driving is generally trending better, is it getting any harder to poach top talent away from competitors?

Question: Patrick O'Shaughnessy - Raymond James - Analyst : Got it. Thank you. And then lastly from me, you spoke about the likelihood of doing some M&A in the back half of the year. Can you remind us both strategically and financially what your criteria is for M&A?

Question: Patrick O'Shaughnessy - Raymond James - Analyst : All right, thank you.