Marcus & Millichap, Inc. Reports Results for Fourth Quarter and Full Year 2023
Marcus & Millichap, Inc. reported financial results for Q4 and full year 2023, with total revenue of $166.2 million in Q4 and $645.9 million for the year. The company experienced a net loss of $10.2 million in Q4 and $34.0 million for the year, impacted by higher expenses. Adjusted EBITDA was $(4.5) million in Q4 and $(19.6) million for the year. The company remains focused on growth initiatives despite market disruptions.
Positive
Total revenue for Q4 was $166.2 million, a decrease of 36.7% from Q4 2022.
Net loss for Q4 was $10.2 million, compared to net income of $7.9 million in Q4 2022.
Adjusted EBITDA for Q4 was $(4.5) million, a decrease from $14.1 million in Q4 2022.
Full year 2023 revenue was $645.9 million, a decrease of 50.4% from 2022.
Net loss for 2023 was $34.0 million, compared to net income of $104.2 million in 2022.
Adjusted EBITDA for 2023 was $(19.6) million, down from $165.5 million in 2022.
Negative
Significant decrease in total revenue for both Q4 and full year 2023 compared to the previous year.
Net loss reported for both Q4 and full year 2023, indicating financial challenges.
Adjusted EBITDA showed a significant decrease for both Q4 and full year 2023, reflecting operational difficulties.
Reduction in the number of investment sales and financing professionals from 2022 to 2023.
The reported financial results by Marcus & Millichap indicate a significant decrease in total revenue and net income, with a substantial year-over-year decline. A critical factor contributing to this performance appears to be the ongoing market disruption caused by the Federal Reserve's anti-inflation measures. Increased interest rates have directly impacted real estate valuations, leading to a decrease in transactions and subsequently, brokerage commissions and financing fees. The reported increase in average fee per transaction and size, despite a decline in the number of transactions, suggests a shift towards higher-value but fewer deals.
From a financial perspective, the company's strategy to invest in growth initiatives, even amidst declining earnings, is noteworthy. While this may affect short-term profitability, as evidenced by the reported net loss and negative adjusted EBITDA, it could position the company for a competitive advantage in a recovering market. The strength of the balance sheet and the ongoing share repurchase program are indicative of management's confidence in the long-term prospects of the company. However, the decrease in the number of investment sales and financing professionals could be a concern if it affects the company's market reach and revenue generation capabilities.
Analyzing the broader market dynamics, Marcus & Millichap's performance reflects the challenges facing the commercial real estate (CRE) sector. The Federal Reserve's actions have led to a higher cost of debt capital, which, coupled with interest rate volatility, has resulted in wider bid-ask spreads and reduced investor motivation. The company's focus on the Private Client Market, which accounts for a significant portion of commercial property sales transactions, suggests a strategic targeting of a market segment that may be less sensitive to macroeconomic headwinds.
Looking ahead, the company's management anticipates a potential increase in transactions and pent-up demand release once there is more clarity on interest rates. This outlook, while optimistic, hinges on factors such as the outcome of the presidential election, policy changes and global geopolitical events, which could further impact investor sentiment and CRE demand. The company's investments in technology and strategic acquisitions could enable it to capitalize on long-term growth opportunities, particularly in the fragmented Private Client Market.
The financial results and outlook of Marcus & Millichap provide insights into the broader economic environment and its impact on the commercial real estate sector. The Federal Reserve's fight against inflation through interest rate hikes has a cascading effect on real estate valuations and investor behavior. The reported decrease in transaction activity is a direct consequence of these macroeconomic policies. Moreover, the company's anticipation of a 'soft landing' scenario suggests an expectation that the economy may slow down without entering a full-blown recession.
It is important to consider the potential for a recession, which could further dampen CRE space demand and transactional activity. Additionally, the upcoming presidential election and its associated uncertainties could lead to a wait-and-see approach among investors. The company's proactive measures to strengthen its balance sheet and enhance its platform are prudent steps in preparing for various economic scenarios. The CRE market's resilience will depend on the interplay between monetary policy, investor sentiment and the broader economic health.
02/16/2024 - 08:00 AM
CALABASAS, Calif. --(BUSINESS WIRE)--
Marcus & Millichap, Inc. (the “Company”, “Marcus & Millichap”, or “MMI”) (NYSE: MMI), a leading national brokerage firm specializing in commercial real estate investment sales, financing, research and advisory services, today reported financial results for the fourth quarter and the year ended December 31, 2023.
Fourth Quarter 2023 Highlights Compared to Fourth Quarter 2022
Total revenue of $166.2 million , compared to $262.4 million
Brokerage commissions of $144.6 million , compared to $235.8 million
Private Client Market brokerage revenue of $94.8 million , compared to $145.6 million
Middle Market and Larger Transaction Market brokerage revenue of $44.1 million , compared to $85.1 million
Financing fees of $15.9 million , compared to $21.6 million
Net loss of $10.2 million , or $0.27 per common share, diluted, compared to net income of $7.9 million , or $0.20 per common share, diluted
Earnings were also impacted by higher expenses related to investments in growth initiatives, including talent acquisition and retention
Adjusted EBITDA of $(4.5) million , compared to $14.1 million
Full Year 2023 Highlights Compared to Full Year 2022
Total revenue of $645.9 million , compared to $1,301.7 million
Brokerage commissions of $559.8 million , compared to $1,170.3 million
Private Client Market brokerage revenue of $373.0 million , compared to $682.0 million
Middle Market and Larger Transaction Market brokerage revenue of $165.9 million , compared to $463.5 million
Financing fees of $66.9 million , compared to $113.0 million
Net loss of $34.0 million , or $0.88 per common share, diluted, compared to net income of $104.2 million , or $2.59 per common share, diluted
Earnings were also impacted by higher expenses related to investments in growth initiatives, including talent acquisition and retention
Adjusted EBITDA of $(19.6) million , compared to $165.5 million
“Our fourth quarter results continued to reflect the ongoing market disruption created by the Fed’s fight against inflation and persistent interest rate volatility impacting real estate valuations,” said Hessam Nadji, president and chief executive officer. “We continue to take advantage of our leading brand and strong financial position to leverage the current period by attracting leading professionals, pursuing strategic investments and acquisitions, and enhancing our technology.”
Mr. Nadji continued, “Looking ahead, uncertainty regarding the timing and scale of the Fed’s plan to lower interest rates continues to weigh on investor motivation. We believe the eventual Fed shift, coupled with growing evidence of an economic soft landing will become catalysts to an increase in transactions and release of pent-up demand held by investors waiting for clarity. With record capital on the sideline, as values adjust we are seeing more buyer activity and offers on well-priced inventory we are bringing to market. MMI’s branding, talent acquisition and platform enhancements are positioning us well to lead in the eventual market recovery. In the interim, our focus remains on maintaining a strong balance sheet, fostering client relationships and strengthening the business for the long term.”
Fourth Quarter 2023 Results Compared to Fourth Quarter 2022
Total revenue for the fourth quarter 2023 was $166.2 million , a decrease of 36.7% compared to $262.4 million for the fourth quarter 2022.
For real estate brokerage commissions, revenue was $144.6 million , a decrease of 38.7% compared to the same period in the prior year. The decline is primarily attributed to a 30.8% decline in transactions. The average transaction size and the average commission per transaction decreased by 3.7% and 11.4% , respectively, compared to the fourth quarter 2022. Private Client Market revenue decreased by 34.9% , and the combined Middle Market and Larger Transaction Market revenue decreased by 48.2% .
For financing fees, revenue was $15.9 million , a decrease of 26.5% from the same period in the prior year, primarily attributed to a 41.9% decline in transactions, while the average fee per transaction and the average transaction size increased by 20.2% and 5.3% , respectively.
Total operating expenses for the fourth quarter 2023 were $183.4 million , compared to $256.6 million for the same period in the prior year. The change was primarily due to reductions of 41.7% in cost of services, partially offset by a 2.9% increase in selling, general and administrative expenses and a 2.3% increase in depreciation and amortization expenses. Cost of services as a percentage of total revenue decreased by 550 basis points to 63.4% compared to the same period during the prior year primarily due to our senior investment sales and financing professionals earning a lower amount of additional commissions due to lower revenue.
Selling, general and administrative expenses for the fourth quarter 2023 were $74.7 million , compared to $72.6 million , for the same period in 2022. The increase was primarily due to costs incurred from consolidation of office space and incremental costs from stock-based compensation, partially offset by a reduction in compensation-related costs, specifically performance-based bonuses.
Net loss for the fourth quarter 2023 was $10.2 million , or $0.27 per common share, diluted, compared to a net income of $7.9 million , or $0.20 per common share, diluted, for the same period in 2022. Adjusted EBITDA for the fourth quarter 2023 was $(4.5) million , compared to $14.1 million for the same period in the prior year, primarily as a result of the decrease in operating income.
Full Year 2023 Results Compared to Full Year 2022
Total revenue for 2023 was $645.9 million , compared to $1,301.7 million for 2022, a decrease of $655.8 million , or 50.4% . Total operating expenses for 2023 decreased by 39.4% to $705.3 million compared to $1,164.3 million for 2022. Cost of services as a percent of total revenues decreased to 63.0% , down 240 basis points compared to 2022. The Company’s net loss for 2023 was $34.0 million , or $0.88 per common share, diluted, compared to a net income of $104.2 million , or $2.59 per common share, diluted, for 2022. Adjusted EBITDA for 2023 decreased to $(19.6) million , from $165.5 million for 2022. As of December 31, 2023, the Company had 1,783 investment sales and financing professionals, compared to 1,904 in 2022.
Capital Allocation
During the twelve months ended December 31, 2023, the Company declared two semi-annual regular dividends totaling $20.4 million , and repurchased 1,260,251 shares of common stock for an aggregate purchase price of $38.9 million .
After accounting for shares repurchased through December 31, 2023, the Company has approximately $71.5 million available to repurchase shares under its share repurchase program. No time limit has been established for the completion of the program, and the repurchases are expected to be executed from time-to-time, subject to general business and market conditions and other investment opportunities, through open market purchases or privately negotiated transactions, including through Rule 10b5-1 plans.
Business Outlook
Notwithstanding the ongoing price discovery and wider than normal bid/ask spreads, the commercial real estate transaction market is poised over the long-term to overcome the near term challenges which are currently expected to extend for the first half of 2024. Accordingly, the Company believes it remains well-positioned to achieve long-term growth.
The Company benefits from its experienced management team, infrastructure investments, industry-leading market research and proprietary technology. The size and fragmentation of the Private Client Market continues to offer long-term growth opportunities through consolidation. This highly fragmented market segment consistently accounts for over 80% of all commercial property sales transactions and over 60% of the commission pool. The top 10 brokerage firms led by MMI have an estimated 20% share of this segment by transaction count.
Key factors that may influence the Company’s business during 2024 include:
Volatility in transactional activity and investor sentiment driven by:
The elevated cost of debt capital
Interest rate uncertainty and the heightened bid-ask spread between buyers and sellers
Risks of a potential recession and its unfavorable impact to CRE space demand
Possible impact to market sentiment related to the presidential election, potential tax and other policy changes which may influence transaction velocity and/or future fluctuations in sales and financing activity
Increase in operating expenses driven by labor costs, insurance, taxes and construction materials
Volatility in each of the Company’s markets
Increase in costs related to in-person events, client meetings, and conferences
Global geopolitical uncertainty, which may cause investors to refrain from transacting
The potential for acquisition activity and subsequent integration
Webcast and Call Information
Marcus & Millichap will host a live webcast today to discuss the financial results at 7:30 a.m. Pacific Time/10:30 a.m. Eastern Time. The webcast will be accessible through the Investor Relations section of Marcus & Millichap's website at ir.marcusmillichap.com and will be archived upon completion of the call. The Company encourages the use of the webcast due to potential extended wait times to access the conference call via dial-in.
For those unable to access the webcast, callers from the United States and Canada should dial 1-877-407-9208 ten minutes prior to the scheduled call time. International callers should dial 1-201-493-6784.
Replay Information
For those unable to participate during the live broadcast, a telephonic replay of the call will also be available from 1:30 p.m. Eastern Time on Friday, February 16, 2024 through 11:59 p.m. Eastern Time on Friday, March 1, 2024 by dialing 1-844-512-2921 in the United States and Canada or 1-412-317-6671 internationally and entering passcode 13743289.
About Marcus & Millichap, Inc.
Marcus & Millichap, Inc. is a leading national brokerage firm specializing in commercial real estate investment sales, financing, research and advisory services. As of December 31, 2023, the Company had 1,783 investment sales and financing professionals in more than 80 offices who provide investment brokerage and financing services to sellers and buyers of commercial real estate. The Company also offers market research, consulting and advisory services to our clients. Marcus & Millichap closed 7,546 transactions in 2023, with a sales volume of $43.6 billion . For additional information, please visit www.MarcusMillichap.com .
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This release includes forward-looking statements, including the Company’s business outlook for 2024, market consensus on interest rate decreases in 2024 and for the 2024 economic forecast, our expectations of 2024 commercial real estate sales activity in the wake of reduced interest rates, the execution of our capital return program, including a semi-annual dividend and stock repurchase program, and expectations for market share growth. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting the financial condition of our business. Forward-looking statements should not be read as a guarantee of future performance or results and will not necessarily be accurate indications of the times at, or by, which such performance or results may be achieved. Forward-looking statements are based on information available at the time those statements are made and/or management’s good faith belief as of that time with respect to future events and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to:
general uncertainty in the capital markets, a worsening of economic conditions, and the rate and pace of economic recovery following an economic downturn;
changes in our business operations;
market trends in the commercial real estate market or the general economy, including the impact of inflation and increased interest rates;
our ability to attract and retain qualified senior executives, managers and investment sales and financing professionals;
the impact of forgivable loans and related expense resulting from the recruitment and retention of agents;
the effects of increased competition on our business;
our ability to successfully enter new markets or increase our market share;
our ability to successfully expand our services and businesses and to manage any such expansions;
our ability to retain existing clients and develop new clients;
our ability to keep pace with changes in technology;
any business interruption or technology failure, including cybersecurity risks and ransomware attacks, and any related impact on our reputation;
changes in interest rates, availability of capital, tax laws, employment laws or other government regulation affecting our business;
our ability to successfully identify, negotiate, execute and integrate accretive acquisitions; and
other risk factors included under “Risk Factors” in our most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q.
In addition, in this release, the words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” "goal," “expect,” “predict,” “potential,” “should” and similar expressions, as they relate to our Company, our business and our management, are intended to identify forward-looking statements. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this release may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements.
Forward-looking statements speak only as of the date of this release. You should not put undue reliance on any forward-looking statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements. We have not filed our Form 10-K for the year ended December 31, 2023. As a result, all financial results described in this earnings release should be considered preliminary, and are subject to change to reflect any necessary adjustments or changes in accounting estimates, that are identified prior to the time we file our Form 10-K.
MARCUS & MILLICHAP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
Three Months Ended
December 31,
Years Ended
December 31,
2023
2022
2023
2022
Revenue:
Real estate brokerage commissions
$
144,559
$
235,827
$
559,752
$
1,170,310
Financing fees
15,877
21,615
66,898
112,978
Other revenue
5,807
5,007
19,277
18,422
Total revenue
166,243
262,449
645,927
1,301,710
Operating expenses:
Cost of services
105,427
180,724
406,645
850,894
Selling, general and administrative
74,702
72,629
285,023
300,009
Depreciation and amortization
3,315
3,239
13,627
13,406
Total operating expenses
183,444
256,592
705,295
1,164,309
Operating (loss) income
(17,201
)
5,857
(59,368
)
137,401
Other income, net
5,733
4,368
19,855
5,336
Interest expense
(216
)
(161
)
(888
)
(708
)
(Loss) income before (benefit) provision for income taxes
(11,684
)
10,064
(40,401
)
142,029
(Benefit) provision for income taxes
(1,451
)
2,153
(6,366
)
37,804
Net (loss) income
$
(10,233
)
$
7,911
$
(34,035
)
$
104,225
(Loss) earnings per share:
Basic
$
(0.27
)
$
0.20
$
(0.88
)
$
2.61
Diluted
$
(0.27
)
$
0.20
$
(0.88
)
$
2.59
Weighted average common shares outstanding:
Basic
38,415
39,461
38,659
39,893
Diluted
38,415
39,678
38,659
40,186
MARCUS & MILLICHAP, INC.
KEY OPERATING METRICS SUMMARY
(Unaudited)
Total sales volume was approximately $11.9 billion for the three months ended December 31, 2023, encompassing 1,947 transactions consisting of $8.7 billion for real estate brokerage (1,413 transactions), $1.4 billion for financing (237 transactions) and $1.8 billion in other transactions, including consulting and advisory services (297 transactions). Total sales volume was $43.6 billion for the year ended December 31, 2023, encompassing 7,546 transactions consisting of $30.8 billion for real estate brokerage (5,475 transactions), $6.7 billion for financing (1,076 transactions) and $6.1 billion in other transactions, including consulting and advisory services (995 transactions). As of December 31, 2023, the Company had 1,684 investment sales professionals and 99 financing professionals. Key metrics for real estate brokerage and financing activities (excluding other transactions) are as follows:
Three Months Ended
December 31,
Years Ended
December 31,
Real Estate Brokerage
2023
2022
2023
2022
Average Number of Investment Sales Professionals
1,705
1,799
1,744
1,817
Average Number of Transactions per Investment
Sales Professional
0.83
1.14
3.14
5.01
Average Commission per Transaction
$
102,306
$
115,431
$
102,238
$
128,450
Average Commission Rate
1.66
%
1.80
%
1.82
%
1.72
%
Average Transaction Size (in thousands)
$
6,168
$
6,407
$
5,630
$
7,473
Total Number of Transactions
1,413
2,043
5,475
9,111
Total Sales Volume (in millions)
$
8,716
$
13,090
$
30,823
$
68,088
Three Months Ended
December 31,
Years Ended
December 31,
Financing (1)
2023
2022
2023
2022
Average Number of Financing Professionals
98
86
96
86
Average Number of Transactions per Financing
Professional
2.42
4.74
11.21
24.92
Average Fee per Transaction
$
54,468
$
45,325
$
50,677
$
44,546
Average Fee Rate
0.89
%
0.78
%
0.81
%
0.74
%
Average Transaction Size (in thousands)
$
6,133
$
5,823
$
6,254
$
5,984
Total Number of Transactions
237
408
1,076
2,143
Total Financing Volume (in millions)
$
1,453
$
2,376
$
6,729
$
12,823
(1)
Operating metrics exclude certain financing fees not directly associated to transactions.
The following table sets forth the number of transactions, sales volume and revenue by commercial real estate market segment for real estate brokerage:
Three Months Ended December 31,
2023
2022
Change
Real Estate Brokerage
Number
Volume
Revenue
Number
Volume
Revenue
Number
Volume
Revenue
(in millions)
(in thousands)
(in millions)
(in thousands)
(in millions)
(in thousands)
<$1 million
209
$
125
$
5,680
208
$
111
$
5,098
1
$
14
$
582
Private Client Market
($1 – <$10 million )
1,043
3,447
94,772
1,565
5,546
145,586
(522
)
(2,099
)
(50,814
)
Middle Market
($10 – <$20 million )
85
1,194
19,567
154
2,131
38,476
(69
)
(937
)
(18,909
)
Larger Transaction
Market (≥$20 million )
76
3,950
24,540
116
5,302
46,667
(40
)
(1,352
)
(22,127
)
1,413
$
8,716
$
144,559
2,043
$
13,090
$
235,827
(630
)
$
(4,374
)
$
(91,268
)
Year Ended December 31,
2023
2022
Change
Real Estate Brokerage
Number
Volume
Revenue
Number
Volume
Revenue
Number
Volume
Revenue
(in millions)
(in thousands)
(in millions)
(in thousands)
(in millions)
(in thousands)
<$1 million
809
$
483
$
20,894
936
$
560
$
24,809
(127
)
$
(77
)
$
(3,915
)
Private Client Market
($1 – <$10 million )
4,097
13,616
372,979
6,850
24,474
682,019
(2,753
)
(10,858
)
(309,040
)
Middle Market
($10 – <$20 million )
303
4,117
73,007
735
9,980
188,593
(432
)
(5,863
)
(115,586
)
Larger Transaction
Market (≥$20 million )
266
12,607
92,872
590
33,074
274,889
(324
)
(20,467
)
(182,017
)
5,475
$
30,823
$
559,752
9,111
$
68,088
$
1,170,310
(3,636
)
$
(37,265
)
$
(610,558
)
MARCUS & MILLICHAP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except for shares and par value)
(Unaudited)
December 31,
2023
2022
Assets
Current assets:
Cash, cash equivalents, and restricted cash
$
170,753
$
235,873
Commissions receivable
16,171
8,453
Prepaid expenses
8,813
9,411
Income tax receivable
9,299
8,682
Marketable debt securities, available-for-sale (amortized cost of $169,018 and $254,682
at December 31, 2023 and December 31, 2022, respectively, and $0 allowance for
credit losses)
168,881
253,434
Advances and loans, net
3,574
4,005
Other assets, current
16,203
7,282
Total current assets
393,694
527,140
Property and equipment, net
27,450
27,644
Operating lease right-of-use assets, net
90,058
87,945
Marketable debt securities, available-for-sale (amortized cost of $69,537 and $72,819 at
December 31, 2023 and December 31, 2022, respectively, and $0 allowance for credit
losses)
67,459
68,595
Assets held in rabbi trust
10,838
9,553
Deferred tax assets, net
46,930
41,321
Goodwill and other intangible assets, net
51,183
55,696
Advances and loans, net
175,827
169,955
Other assets, non-current
14,972
15,859
Total assets
$
878,411
$
1,003,708
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable and accrued expenses
$
8,126
$
11,450
Deferred compensation and commissions
55,769
75,321
Operating lease liabilities
18,336
16,984
Accrued bonuses and other employee related expenses
19,119
38,327
Other liabilities, current
3,919
9,933
Total current liabilities
105,269
152,015
Deferred compensation and commissions
47,771
64,461
Operating lease liabilities
69,407
65,109
Other liabilities, non-current
10,690
8,614
Total liabilities
233,137
290,199
Commitments and contingencies
—
—
Stockholders’ equity:
Preferred stock, $0.00 01 par value:
Authorized shares – 25,000,000; issued and outstanding shares – none at December 31, 2023
and 2022, respectively
—
—
Common stock, $0.00 01 par value:
Authorized shares – 150,000,000; issued and outstanding shares – 38,412,484 and
39,255,838 at December 31, 2023 and 2022, respectively
4
4
Additional paid-in capital
153,740
131,541
Retained earnings
492,298
585,581
Accumulated other comprehensive loss
(768
)
(3,617
)
Total stockholders’ equity
645,274
713,509
Total liabilities and stockholders’ equity
$
878,411
$
1,003,708
MARCUS & MILLICHAP, INC.
OTHER INFORMATION
(Unaudited)
Adjusted EBITDA Reconciliation
Adjusted EBITDA, which the Company defines as net (loss) income before (i) interest income and other, including net realized gains (losses) on marketable debt securities, available-for-sale and cash, cash equivalents, and restricted cash, (ii) interest expense, (iii) (benefit) provision for income taxes, (iv) depreciation and amortization, and (v) stock-based compensation. The Company uses Adjusted EBITDA in its business operations to evaluate the performance of its business, develop budgets and measure its performance against those budgets, among other things. The Company also believes that analysts and investors use Adjusted EBITDA as a supplemental measure to evaluate its overall operating performance. However, Adjusted EBITDA has material limitations as a supplemental metric and should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under U.S. generally accepted accounting principles (“U.S. GAAP”). The Company finds Adjusted EBITDA to be a useful management metric to assist in evaluating performance, because Adjusted EBITDA eliminates items related to capital structure, taxes and non-cash items. Considering the foregoing limitations, the Company does not rely solely on Adjusted EBITDA as a performance measure and also considers its U.S. GAAP results. Adjusted EBITDA is not a measurement of the Company’s financial performance under U.S. GAAP and should not be considered as an alternative to net income, operating income or any other measures calculated in accordance with U.S. GAAP. Because Adjusted EBITDA is not calculated in the same manner by all companies, it may not be comparable to other similarly titled measures used by other companies.
A reconciliation of the most directly comparable U.S. GAAP financial measure, net income, to Adjusted EBITDA is as follows (in thousands):
Three Months Ended
December 31,
Years Ended December 31,
2023
2022
2023
2022
Net (loss) income
$
(10,233
)
$
7,911
$
(34,035
)
$
104,225
Adjustments:
Interest income and other (1)
(4,689
)
(3,992
)
(17,890
)
(7,951
)
Interest expense
216
161
888
708
(Benefit) provision for income taxes
(1,451
)
2,153
(6,366
)
37,804
Depreciation and amortization
3,315
3,239
13,627
13,406
Stock-based compensation
8,338
4,637
24,146
17,312
Adjusted EBITDA
$
(4,504
)
$
14,109
$
(19,630
)
$
165,504
(1)
Other includes net realized gains (losses) on marketable debt securities available-for-sale.
Glossary of Terms
Private Client Market segment: transactions with values from $1 million to up to but less than $10 million
Middle Market segment: transactions with values from $10 million to up to but less than $20 million
Larger Transaction Market segment: transactions with values of $20 million and above
Certain Adjusted Metrics
Real Estate Brokerage
Following are actual and as adjusted metrics excluding any large transactions in our real estate brokerage business in excess of $300 million:
Three Months Ended
December 31, 2023
Year Ended
December 31, 2023
(actual)
(as adjusted)
(actual)
(as adjusted)
Total Sales Volume Decrease
(33.4)%
(33.4)%
(54.7)%
(51.9)%
Average Commission Rate (Decrease) Increase
(7.8)%
(7.8)%
5.8%
2.2%
Average Transaction Size Decrease
(3.7)%
(3.7)%
(24.7)%
(20.0)%
View source version on businesswire.com: https://www.businesswire.com/news/home/20240216250379/en/
Investor Relations :
Investor Relations
InvestorRelations@marcusmillichap.com
Source: Marcus & Millichap, Inc.
What was Marcus & Millichap's total revenue for Q4 2023?
Marcus & Millichap's total revenue for Q4 2023 was $166.2 million.
What was the net loss reported by Marcus & Millichap for Q4 2023?
Marcus & Millichap reported a net loss of $10.2 million for Q4 2023.
How did Marcus & Millichap's Adjusted EBITDA for Q4 2023 compare to Q4 2022?
Marcus & Millichap's Adjusted EBITDA for Q4 2023 was $(4.5) million, a decrease from $14.1 million in Q4 2022.
What was Marcus & Millichap's full year 2023 revenue?
Marcus & Millichap's full year 2023 revenue was $645.9 million.
What was the net loss reported by Marcus & Millichap for full year 2023?
Marcus & Millichap reported a net loss of $34.0 million for full year 2023.
How did Marcus & Millichap's Adjusted EBITDA for full year 2023 compare to 2022?
Marcus & Millichap's Adjusted EBITDA for full year 2023 was $(19.6) million, down from $165.5 million in 2022.