Newmark Outperforms on AI-Driven Leasing and Capital Markets

Date of Call: Feb 25, 2026

Financials Results

• Revenue: $1.0B, up 15.3% YOY
• EPS: $0.68 per diluted share, up 23.6% YOY

Guidance:

• Total revenues for 2026 expected to be $3.7B-$3.8B, an increase of 13.8% at the midpoint.
• Adjusted EBITDA expected to be $635M-$675M, an increase of 13%-20%.
• Adjusted EPS expected to be $1.82-$1.92, up 12%-19%.
• Capital markets growth expected to be above the revenue midpoint, management/servicing growth roughly in line, and leasing improvement below the midpoint.

Business Commentary:

Revenue and Earnings Growth:

• Newmark reported record total revenues of just over $1 billion, up 15.3% compared to $872.7 million in the previous year.
• The growth was driven by investments in talent and platform improvements, resulting in double-digit top line improvement across all major business lines.

Leasing and Capital Markets:

• The company's leasing business increased by 13.6%, leading to a record quarter, while capital markets increased by 19.2%, reflecting significant activity across office, retail, and multifamily sectors.
• Growth in leasing was supported by strong activity in New York and Texas, and the capital markets gains were attributed to significant debt and investment sales volumes.

Management and Servicing Revenue:

• Newmark improved its full year management and servicing revenues by 12% to a new high of over $1.24 billion.
• This growth resulted from strong organic growth in valuation and advisory services, as well as contributions from recent acquisitions.

AI Impact and Strategic Growth:

• AI-led demand contributed to strong results in office leasing, data centers, capital markets, and valuation services.
• The strategic use of AI and proprietary data is expected to provide efficiency and margin enhancement, supporting future growth.

International Expansion and Market Positioning:

• Newmark's international expansion is expected to grow its market share globally across nearly all business lines over the next several years.
• The expansion strategy involves leveraging client relationships and investing in global talent, particularly in Europe and other key markets.

Sentiment Analysis:

Overall Tone: Positive

• "Newmark's strong momentum continued in the fourth quarter as we improved total revenues and adjusted EPS by 15% and 24%, respectively." "Given the success of our strategy and the favorable macroeconomic backdrop for commercial real estate, we expect to achieve double-digit top and bottom line growth for the third consecutive year in 2026, while generating our best-ever total revenues, adjusted EPS and adjusted EBITDA."

Q&A:

• Question from Alexander Goldfarb (Piper Sandler): Concerns about how AI is impacting office needs and staffing based on client discussions.
  Response: Management sees increased return-to-office activity and views AI as an accelerant that enhances productivity and margin, not a driver of reduced office needs.

• Question from Alexander Goldfarb (Piper Sandler): Expectation for a surge in refinancing due to maturing multifamily debt from 2021.
  Response: Management expects significant debt maturity activity over the next 3 years and anticipates strong investor demand for new opportunities, driving capital markets activity.

• Question from Jade Rahmani (KBW): Risk of property-level data becoming public and its impact on different market segments.
  Response: Management acknowledges some data is confidential but believes they have ample proprietary data to create value for clients, combining it with AI for competitive advantage.

• Question from Jade Rahmani (KBW): How AI advances leading capital markets teams versus newer talent.
  Response: Management sees AI as beneficial for both established teams (enhancing margin) and newer talent (increasing business efficiency), accelerating the firm's strategy of hiring the best talent.

• Question from Julien Blouin (Goldman Sachs): Disruptive risk of AI to middle-market vs. high-tier brokerage peers.
  Response: Management believes smaller, commoditized deals are more at risk, but sees AI as a way to accelerate business processes, allowing more deals with fewer people, which benefits Newmark's platform.

• Question from Julien Blouin (Goldman Sachs): Whether the recent share repurchase authorization increase signals a shift toward more aggressive buybacks.
  Response: Management confirms they will be more aggressive with buybacks given the stock price and earnings outlook, but emphasizes they have low leverage, strong cash flow, and will continue investing in growth.

• Question from Mitch Germain (Citizens JMP Securities): Productivity timeline for international hiring (e.g., in Europe).
  Response: Productivity ramp varies by country (12-18 months typical), with breakeven achieved faster than expected (within 1-4 years) due to strong talent acquisition and platform appeal.

• Question from Mitch Germain (Citizens JMP Securities): Rationale behind the Altus (Canada valuation firm) acquisition.
  Response: The acquisition aims to strengthen Newmark's platform in Canada, enhance valuation talent recruitment, and integrate into Newmark's global appraisal growth strategy.

• Question from Brendan Lynch (Barclays): AI's impact on client priorities in industrial/retail leasing (e.g., power, robotics).
  Response: Management leverages its data center expertise to advise clients on power and locational needs for AI-related facilities, noting power has become an even more critical factor.

• Question from Brendan Lynch (Barclays): Evolution of the competitive landscape for talent and recruiting process.
  Response: Management emphasizes their platform's non-crowded nature, attractive for brokers seeking less internal competition, and states they are not having a problem recruiting top talent.

• Question from Jade Rahmani (KBW): Revenue growth expectations by business line (leasing, management services, capital markets).
  Response: Guidance expects capital markets to outpace the revenue midpoint, management/servicing to be roughly in line, and leasing to be slightly below the midpoint.

Contradiction Point 1

AI's Impact on Office Space and Staffing Needs

Contradiction on whether AI reduces office space requirements.

What was the question from Alexander Goldfarb of Piper Sandler & Co.? - Alexander Goldfarb (Piper Sandler & Co.)

2025Q4: It's still early, but AI is seen as an accelerant, not a driver of reduced office space... The company is not seeing any reduction in office staffing from its clients in primary markets. - Barry Gosin(CEO)

How is AI impacting your clients' (renters/occupiers') office needs, employment, and staffing? - Alexander Goldfarb (Piper Sandler & Co.)

2025Q3: The U.S. requires enormous infrastructure investment... There is significant runway for growth if you believe in AI. - Barry Gosin(CEO) [Implied focus on capital-intensive AI infrastructure, not direct office space impact]

Contradiction Point 2

2026 Revenue Growth Outlook Conservatism

Contradiction on whether the 2026 target is conservative.

What are your thoughts on the earnings report? - Jade Rahmani (Keefe, Bruyette, & Woods, Inc.)

2025Q4: The 2026 targets are considered conservative. The company will provide an updated outlook next quarter... - Michael Rispoli(CFO)

For the 2026 12-15% revenue growth target, how will leasing, management services, and capital markets perform relative to the midpoint? - Jade Rahmani (Keefe, Bruyette, & Woods, Inc.)

2025Q4: On the capital allocation: The share repurchase authorization increase signals a willingness to be more aggressive with buybacks given the stock price and earnings outlook. - Michael Rispoli(CFO) & Barry Gosin(CEO) [Implies confidence in earnings growth]

Contradiction Point 3

AI's Impact on Office Space and Staffing

Contradiction on whether AI leads to reduced office space/staffing.

What are your key priorities for the next quarter? - Alexander Goldfarb (Piper Sandler & Co.)

2025Q4: AI is seen as an accelerant... Newmark sees it as a 'gift'... The company is not seeing any reduction in office staffing from its clients in primary markets. - Barry Gosin(CEO)

How is AI impacting your clients' (renters/occupiers) office needs, employment, and staffing decisions? - Alexander David Goldfarb (Piper Sandler & Co.)

2025Q2: Activity in the Bay Area is coming from all different places... leading to significant leasing demand. - Barry M. Gosin(CEO)

Contradiction Point 4

Growth Expectations for Capital Markets

Contradiction on the growth rate forecast for Capital Markets.

What is your assessment of the company's earnings performance? - Jade Rahmani (Keefe, Bruyette, & Woods, Inc.)

2025Q4: Within the 12-15% revenue growth outlook for 2026... Capital Markets is expected to grow above the midpoint (strong market share gains anticipated). - Michael Rispoli(CFO)

How will leasing, management services, and capital markets perform relative to the midpoint of the 12-15% 2026 revenue growth outlook? - Jason Sabshon (Keefe, Bruyette, & Woods, Inc.)

2025Q2: Expects mid- to high-teens growth for capital markets in H2. - Michael J. Rispoli(CFO)