Revenues from Contracts with Customers

6 Months Ended

Jun. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenues from Contracts with Customers

Revenues from Contracts with Customers

The following table presents Newmark’s total revenues separately for its revenues from contracts with customers and other sources of revenues (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2023		2022		2023		2022
Revenues from contracts with customers:
Leasing and other commissions	$	203,611	$	212,825	396,917		$	411,778
Investment sales	77,604		209,053		149,597		361,167
Mortgage brokerage and debt placement	19,330		50,326		36,476		96,615
Management services	178,161		181,329		340,265		366,389
Total	478,706		653,533		923,255		1,235,949
Other sources of revenue(1):
Fair value of expected net future cash flows from servicing recognized at commitment, net	23,046		31,499		37,145		60,971
Loan originations related fees and sales premiums, net	21,593		17,963		33,556		36,264
Servicing fees and other	62,499		52,356		112,687		100,415
Total	$	585,844	$	755,351	$	1,106,643	$	1,433,599

(1)Although these items have customers under contract, they were recorded as other sources of revenue as they were excluded from the scope of ASU No. 2014-9.

Disaggregation of revenues

Newmark’s chief operating decision-maker, regardless of geographic location, evaluates the operating results, including revenues, of Newmark as total real estate services (see Note 3 — “Summary of Significant Accounting Policies” for further discussion).

Contract balances

The timing of Newmark’s revenue recognition may differ from the timing of payment by its customers. Newmark records a receivable when revenue is recognized prior to payment and Newmark has an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, Newmark records deferred revenue until the performance obligations are satisfied.

Newmark’s deferred revenue primarily relates to customers paying in advance or billed in advance where the performance obligation has not yet been satisfied. Deferred revenue is recorded as a contract liability. Deferred revenue at June 30, 2023 and December 31, 2022 was $2.5 million and $2.9 million, respectively. For the three and six months ended June 30, 2023, Newmark recognized revenue of $1.5 million and $3.0 million, respectively, that was recorded as deferred revenue in a previous period. For the three and six months ended June 30, 2022, Newmark recognized revenue of $0.9 million and $1.8 million, respectively, that was recorded as deferred revenue in a previous period.

For Knotel and Deskeo, the Company’s remaining performance obligations that represent contracted customer revenues, that have not yet been recognized as revenue as of June 30, 2023, that will be recognized as revenue in future periods over the life of the customer contracts, in accordance with ASC 606, are approximately $165.4 million. Over half of the remaining performance obligation as of June 30, 2023 is scheduled to be recognized as revenue within the next twelve months, with the remaining to be recognized over the remaining life of the customer contracts, which extends through 2030.

Approximate future cash flows to be received over the next five years as of June 30, 2023 are as follows (in thousands):

2023	$	56,753
2024	60,550
2025	30,067
2026	9,595
2027	4,918
Thereafter	3,520
Total	$	165,403