Earnings Per Share and Weighted-Average Shares Outstanding

9 Months Ended

Sep. 30, 2022

Earnings Per Share and Weighted-Average Shares Outstanding

U.S. GAAP guidance — Earnings (Loss) Per Share provides guidance on the computation and presentation of earnings (loss) per share (“EPS”). Basic EPS excludes dilution and is computed by dividing Net income available to common stockholders by the weighted-average number of shares of common stock outstanding and contingent shares for which all necessary conditions have been satisfied except for the passage of time. Net income (loss) is allocated to Newmark’s outstanding common stock, FPUs, limited partnership units and Cantor units (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings”). In addition, in relation to the Newmark OpCo Preferred Investment, the EPUs issued in June 2018 and September 2018 were entitled to a preferred payable-in-kind dividend which is recorded as accretion to the carrying amount of the EPUs and was a reduction to net income available to common stockholders for the calculation of Newmark’s basic earnings per share and fully diluted earnings per share.

The following is the calculation of Newmark’s basic EPS (in thousands, except per share data):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Basic earnings per share:
Net income available to common stockholders (1)	$	27,964	$	128,549	$	76,848	$	595,198
Basic weighted-average shares of common stock outstanding	177,231		199,413		183,311		189,317
Basic earnings per share	$	0.16	$	0.64	$	0.42	$	3.14

(1)Includes a reduction for dividends on preferred stock or EPUs in the amount of $0.0 million and $6.2 million for the three and nine months ended September 30, 2021, respectively (see Note 1 — “Organization and Basis of Presentation”).

Fully diluted EPS is calculated utilizing net income available to common stockholders plus net income allocations to the limited partnership interests in Newmark Holdings as the numerator. The denominator comprises Newmark’s weighted-average number of outstanding shares of Newmark common stock to the extent the related units are dilutive and, if dilutive, the weighted-average number of limited partnership interests and other contracts to issue shares of common stock, stock options and RSUs. The limited partnership interests generally are potentially exchangeable into shares of Newmark Class A common stock and are entitled to remaining earnings after the deduction for the Preferred Distribution; as a result, they are included in the fully diluted EPS computation to the extent that the effect would be dilutive.

The following is the calculation of Newmark’s fully diluted EPS (in thousands, except per share data):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Fully diluted earnings per share:
Net income available to common stockholders	$	27,964	$	128,549	$	76,848	$	595,198
Allocations of net income to limited partnership interests in Newmark Holdings, net of tax	9,710		—		23,635		—
Net income for fully diluted shares	$	37,674	$	128,549	$	100,483	$	595,198
Weighted-average shares:
Common stock outstanding	177,231		199,413		183,311		189,317


Partnership units (1)	61,501				58,899		—
RSUs (Treasury stock method)	2,604		4,696		3,809		3,816
Newmark exchange shares	2,133		1,172		2,048		1,187
Fully diluted weighted-average shares of common stock outstanding	243,469		205,281		248,067		194,320
Fully diluted earnings per share	$	0.15	$	0.63	$	0.41	$	3.06

(1)Partnership units collectively include FPUs, limited partnership units, and Cantor and BGC units (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings” for more information).

For the three and nine months ended September 30, 2022, 0.9 million and 0.9 million potentially dilutive securities, respectively, were excluded from the computation of fully diluted EPS because their effect would have been anti-dilutive. For the three and nine months ended September 30, 2021, 52.5 million and 73.6 million potentially dilutive securities, respectively, were excluded from the computation of fully diluted EPS because their effect would have been anti-dilutive.