Tech leasing helped lift Newmark's revenues to new highs last quarter, but the brokerage firm is revising its outlook for the rest of the year downward due to macroeconomic volatility.
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Newmark on Thursday reported third-quarter revenue of $937M, up almost 13% from the same period last year and marking its best third quarter on record.
The growth was driven by Newmark's management services business and a leasing bump from the tech sector, including artificial intelligence and data center companies. Manufacturing, legal services, and aerospace and defense tenants also helped boost revenue last quarter.
Despite this growth, Newmark revised its earnings outlook for the full year to a range of $3.7B to $3.8B. This is $75M below its prior guidance, but still above its 2025 figures, The Real Deal first reported.
The firm also gave a wide range for its 2027 guidance, stating its revenue could see anywhere from a 10% gain to a 10% drop.
"We expect industry capital markets volumes to be down through at least the first half of next year, given the recent rise in the level and volatility of rates," Newmark Chief Financial Officer Michael Rispoli said during the firm's Q3 earnings call.
The firm said elevated interest rates have disrupted deals this year, leading to the downward revision.
"We definitely saw deals taking longer to close," Chief Operating Officer Lou Alvarado said.
This week, the Federal Reserve elected to hold interest rates steady, which was widely expected but still contributes to the market's pain as inflation persists.
Longtime Newmark leader Barry Gosin is set to depart by the end of this year. The search is still on for his replacement, with Alvarado and President of Global Asset Services Jack Fuchs emerging as two likely candidates, TRD reported.
The firm is still on track to identify a new CEO by the end of the year.
"I love this company. I will continue to be here to help through the transition," Gosin said. "I'm confident in Newmark's senior leadership, who collectively have decades of experience."
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