The Real Brokerage (REAX) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 results with revenue up 74% year-over-year to $372.5 million, driven by a 76% increase in closed transactions and a 79% rise in agent count to 21,770, all organic growth, significantly outperforming a declining industry.

• Launched major technology initiatives, including Leo CoPilot (AI-driven agent platform), Leo for Clients (consumer-facing AI portal), and Real Wallet (financial platform for agents), supporting agent empowerment and operational efficiency.

• Ancillary business lines (mortgage and title) grew 97% year-over-year, with mortgage up over 200%, and are being scaled to enhance margins.

• The company leverages a proprietary software platform, innovative compensation models, and a collaborative culture to drive agent growth and operational efficiency.

• Real maintains a debt-free balance sheet and continues to invest in technology, agent support, and new product rollouts.

Financial highlights

• Q3 2024 revenue was $372.5 million, up from $215 million in Q3 2023; LTM revenue reached $1,095 million.

• Gross profit rose 71% to $32.1 million, with gross margin at 8.6% (vs. 8.7% prior year).

• Adjusted EBITDA improved to $13.3 million from $3.5 million year-over-year.

• Net loss attributable to owners for Q3 2024 was $2.6 million, improved from $4 million in Q3 2023.

• Cash and investments at quarter-end were $32 million; no debt; $15.1 million allocated to share repurchases.

Outlook and guidance

• Expect operating expenses to increase in Q4 due to headcount additions, while revenue will decline sequentially due to industry seasonality.

• Focus remains on scaling technology, agent support, and ancillary services, with attach rates for ancillary products expected to rise by the second half of 2025.

• Plans to launch Leo for Clients, a consumer-facing AI-driven app, in 2025 to streamline the homebuying process and increase ancillary service attachment.

• No immediate plans for international expansion beyond North America.

• Continued agent and revenue growth expected, leveraging a scalable platform and expanding fintech offerings.