Marcus & Millichap, Inc. Showcases Second Quarter 2024 Financial Results
CALABASAS, Calif. — Marcus & Millichap, Inc. (NYSE: MMI), a distinguished national firm in the commercial real estate sector offering investment sales, financing, research, and advisory services, today unveiled its financial achievements for the second quarter of 2024.
Noteworthy Highlights from the Second Half of 2024
Marcus & Millichap’s President and Chief Executive Officer, Hessam Nadji, expressed optimism over the company’s growth trajectory in the second quarter, emphasizing a remarkable 27% surge in brokerage transaction volume. This growth is attributed to more accurately priced listings, the re-entry of opportunistic capital into the market, and effective internal business-enhancing strategies. Moreover, the downward trend in the 10-year treasury yield alongside expectations for an upcoming easing cycle in interest rates offers additional encouragement.
Nadji pointed out the existing market uncertainties but remains optimistic due to expected lower interest rates and substantial buyer demand backed by record-high capital reserves. He underscores the firm’s continued dedication to innovation, productivity, and strategic talent management as critical factors propelling Marcus & Millichap’s forward momentum.
Second Quarter 2024 Financial Outcomes
For Q2 2024, Marcus & Millichap reported a total revenue of $158.4 million, marking a slight decrease from the previous year’s $162.9 million. A detailed look into the financials reveals a 3.5% decline in real estate brokerage commissions, largely due to a 4.9% decrease in total sales volume, an aftermath of the exorbitant interest rates and limited lending landscape. However, financing fees painted a brighter picture with an 11.0% jump in total financing volume, slightly offset by a decrease in the average fee rate.
Total operating expenses saw a reduction, dropping to $166.4 million from $173.5 million year-over-year. This was mainly a result of a 3.0% decrease in the cost of services and a 5.7% decrease in selling, general, and administrative expenses.
The firm witnessed a net loss of $5.5 million, an improvement compared to the net loss of $8.7 million reported in the same period last year. Similarly, adjusted EBITDA showed positive movement, recording $1.4 million compared to the previous year’s negative $1.1 million.
Six-Month Performance and Prospects
For the first half of 2024, Marcus & Millichap’s total revenue stood at $287.5 million compared to $317.7 million in the same period last year, highlighting a 9.5% decrease. Net loss marginally expanded to $15.5 million from $14.6 million year-over-year.
Strategic Capital Allocation
Aligning with its shareholder value enhancement strategy, Marcus & Millichap’s Board of Directors announced a semi-annual dividend of $0.25 per share due in October 2024. Furthermore, the company has been actively repurchasing shares under its buyback program, emphasizing its strong fiscal prudence and investor confidence.
Forward-Looking Outlook
Despite ongoing market adjustments and uncertainties linked to interest rate movements, Marcus & Millichap remains optimistic. The company’s robust management, strategic investments in technology, and expansive market research capabilities are viewed as pivotal elements for sustained long-term growth. Specifically, the company eyes significant opportunities within the highly fragmented Private Client Market.
Key influencers of the company’s future trajectory include the overall health of the commercial real estate transaction market and the effective deployment of its capital return strategies, encompassing both dividend payments and stock repurchase plans.
Summary
Marcus & Millichap, Inc. continues to chart a path through fluctuating market dynamics with a balanced combination of defensive and aggressive strategies, aimed at capitalizing on its robust market position and extensive industry expertise. As it navigates the uncertainties of 2024, the firm remains well-equipped to seize growth opportunities and drive shareholder value.
About Marcus & Millichap, Inc.
As a leader in commercial real estate services, Marcus & Millichap, Inc. provides unmatched expertise in investment sales, financing, research, and advisory services. With a comprehensive network of 1,726 investment sales and financing professionals across more than 80 offices, the company has solidified its role as a key player in the commercial real estate landscape. For additional details, visit the Marcus & Millichap website.
Note: This article contains forward-looking statements based on current expectations and may differ materially from actual outcomes. These are subject to uncertainties and changes in circumstances, financial trends, or market factors.
