Revenues from Contracts with Customers

9 Months Ended

Sep. 30, 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 September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Revenues from contracts with customers:
Leasing and other commissions	$	214,581	$	203,268	$	581,937	$	600,185
Investment sales	99,223		94,707		261,777		244,304
Mortgage brokerage and debt placement	42,195		24,479		97,555		60,955
Management services	211,977		190,697		604,177		526,848
Total	567,976		513,151		$	1,545,446	$	1,432,292
Other sources of revenue(1):
Fair value of expected net future cash flows from servicing recognized at commitment, net	26,220		20,997		$	65,759	$	58,142
Loan originations related fees and sales premiums, net	21,070		19,083		56,423		52,639
Servicing fees and other (2)	70,646		63,052		198,158		179,853
Total	$	685,912	$	616,283	$	1,865,786	$	1,722,926

(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 is no longer reported under “Management services” but is instead recorded as part of “Servicing fees” for all periods from the first quarter of 2023 onwards. For the three and nine months ended September 30, 2023, $2.2 million and $6.3 million, respectively, was reclassified from “Management services” to “Servicing fees.”

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 September 30, 2024 and December 31, 2023 was $1.5 million and $2.7 million, respectively. For the three and nine months ended September 30, 2024, Newmark recognized revenue of $0.04 million and $1.3 million, respectively, that was recorded as deferred revenue in a previous period. For the three and nine months ended September 30, 2023, Newmark recognized revenue of $0.2 million and $1.7 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 September 30, 2024 and that will be recognized as revenue in future periods over the life of the customer contracts in accordance with ASC 606, are approximately $184.8 million. Over half of the remaining performance obligations as of September 30, 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 September 30, 2024 are as follows (in thousands):

2024	$	30,329
2025	92,171
2026	45,242
2027	12,529
2028	4,247
Thereafter	252
Total	$	184,770