The Real Brokerage (REAX) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 revenue of $341 million, up 84% year-over-year, driven by a 73% increase in closed transactions and a 6% rise in average revenue per transaction.

• Ended the quarter with 19,540 agents, up 70% year-over-year, and surpassed 20,500 agents post-quarter, reflecting robust agent growth.

• Ancillary mortgage and title business lines grew 68% year-over-year, with mortgage revenue up 160%.

• The company leverages proprietary technology, a unique agent compensation model, and a collaborative culture to drive rapid agent and revenue growth.

• Real has expanded agent count over 4x since 2022, despite a 20%+ decline in the broader home sales market.

Financial highlights

• Gross profit was $31.9 million, up 79% year-over-year, with a gross margin of 9.4%.

• Adjusted EBITDA reached a record $14 million, a significant improvement from $2.6 million in Q2 2023.

• Net loss attributable to owners narrowed to $1.1 million from $4.1 million year-over-year.

• Unrestricted cash and investments stood at $33.6 million, with no debt as of June 30, 2024.

• Repurchased 2.7 million shares for $10.6 million under normal course issuer bid.

Outlook and guidance

• Expects meaningful year-over-year growth in Adjusted EBITDA for the remainder of 2024, but cautions against annualizing Q2 results due to seasonality, challenging market conditions, and increased headcount.

• Management emphasizes sustainable, capital-efficient growth and long-term value creation, with a focus on expanding ancillary services and technology-driven margin improvement.

• Ongoing investments planned in people and technology to support agent base expansion and client experience.