Revenues from Contracts with Customers

3 Months Ended

Mar. 31, 2024

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 March 31,
	2024		2023
Revenues from contracts with customers:
Leasing and other commissions	$	158,799	$	193,306
Investment sales	70,823		71,993
Mortgage brokerage and debt placement	27,100		17,146
Management services	193,437		159,956
Total	$	450,159	$	442,401
Other sources of revenue(1):
Fair value of expected net future cash flows from servicing recognized at commitment, net	$	16,144	$	14,099
Loan originations related fees and sales premiums, net	16,699		11,963
Servicing fees and other (2)	63,497		52,336
Total	$	546,499	$	520,799

(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.

(2)Beginning in the first quarter of 2024, the portion of Spring11's revenues associated with its servicing and asset management portfolio are no longer reported under “Management services” but are instead recorded as part of “Servicing and other revenues” for all periods from the first quarter of 2023 onwards. For the quarter ended March 31, 2023, $2.1 million was reclassified from “Management services” to “Servicing fees and other”.

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 March 31, 2024 and December 31, 2023 was $2.7 million and $2.7 million, respectively. During the three months ended March 31, 2024 and 2023, Newmark recognized revenue of $0.3 million and $1.5 million, respectively, that was recorded as deferred revenue at the beginning of the 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 March 31, 2024, that will be recognized as revenue in future periods over the life of the customer contracts, in accordance with ASC 606, are approximately $192.5 million. Over half of the remaining performance obligation as of March 31, 2024 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 March 31, 2024 are as follows (in thousands):

2024	$	93,594
2025	60,724
2026	26,566
2027	7,932
2028	3,713
Thereafter	15
Total	$	192,544