Strong Revenue Growth
Q1 revenue of $466.0M, up 32% year-over-year.
Re/Max Holdings
· RMAX
May 8th, 2026
Summary
- Earnings Call Date:
- 2026-05-08
- Change Since:
- -4.82%
- Next Earnings Date:
- 2026-08-05
Earnings Call Sentiment
PositiveThe call presents a majority of positive operational and financial developments — strong revenue growth (+32% YoY), significant adjusted EBITDA expansion (+80% YoY), transaction and agent growth (+25% transactions) and tangible progress across ancillary products (Real Wallet, Title, Mortgage). Management also announced a strategic acquisition of RE/MAX with quantified synergies and cross‑sell opportunities. Offsetting risks include an ongoing operating loss (albeit improved), gross margin pressure from capped agent mix, a near‑term step‑up in acquisition costs and the need to execute a complex integration while carrying acquisition-related leverage. On balance, highlights materially outweigh the identified lowlights given the growth, profitability trajectory and clear strategic rationale for scale.
Company Guidance
Management gave directional (not formal) guidance: they expect Q2 revenue to rise sequentially with normal seasonality, but gross margin to trend lower through the year as more agents hit commission caps (Q1 gross margin 9.1% vs 9.6% a year ago), with Q2 YoY margin pressure similar to Q1 and a flatter YoY trend expected in H2. They warned Q2 operating expenses will reflect a material step‑up in RE/MAX acquisition‑related costs (to be reported as non‑recurring) but reiterated the plan to grow OpEx slower than revenue to drive continued YoY improvement in adjusted EBITDA (Q1 adjusted EBITDA $14.9M, +80% YoY) and improved operating loss (Q1 operating loss $3.4M). On the transaction and capital plan they target closing in H2, modeled RE/MAX at roughly $880M enterprise value (~9x trailing adj. EBITDA of ~$94M, ~7x post‑synergies), underwrote $30M of run‑rate cost synergies, will take on debt but expect to delever to ~2x net debt/adjusted EBITDA by the end of the second full fiscal year post‑close, and noted ancillary tailwinds (ancillary revenue $3M, +34%; Real Wallet revenue $436k, ~+250%; weekly debit card spend >$1M; deposits >$25M) that should help margins over time.
Improved Profitability and Liquidity
Operating loss improved to -$3.4M (vs -$5.2M prior year, an improvement of $1.8M); adjusted EBITDA of $14.9M, up 80% year-over-year; operating cash flow of $23.3M; unrestricted cash and short-term investments increased by $30M to a record $62.9M; company carries no debt.
Transaction and Agent Growth
Agents closed nearly 42,000 transactions in Q1, up 25% year-over-year. Agent count was ~33,500 at quarter end and grew to over 33,900 as of May 6 (net increase ~400), with improved retention versus industry trends.
Ancillary Business Momentum
Ancillary revenue $3.0M, up 34% YoY. Real Wallet revenue more than tripled (reported $436K; ~+250% YoY), with 8,000 active agents (23% of base), weekly debit card spend >$1M, deposit balances >$25M and ~$9M of credit extended. One Real Title revenue +22% YoY and One Real Mortgage revenue +20% YoY.
Operational Leverage
Gross profit grew 24% to $42.2M while operating expenses rose 17% to $45.6M; operating expenses as a percentage of revenue improved to 9.8% from 11.1% a year ago. Adjusted EBITDA growth (80%) outpaced revenue growth (32%) — roughly 2.5x — demonstrating leverage in the model.
Strategic RE/MAX Transaction with Quantified Upside
Announced definitive agreement to acquire RE/MAX (implied enterprise value ~ $880M). RE/MAX generated ~$94M of adjusted EBITDA in 2025; transaction multiples ~9x trailing adjusted EBITDA (~7x post-synergies). Management cites $30M of cost synergies and material top‑line cross-sell potential (combined >700,000 U.S. transactions; management estimates a 1% attachment across mortgage/title could generate ~$25M and >$10M of revenue, respectively).
Product & Platform Progress
HeyLeo beta live with 450 agents and ~4,500 on the waitlist; 357 MLS ingested and on track to exceed 400 by end of Q2. Continued rollout of reZEN and Leo AI, positioning for lead-monetization and agent productivity gains.
Tamir Poleg
Thank you, Alex, and good morning, everyone. I will cover our Q1 results and the RE/MAX transaction. Jenna will provide an update on key brokerage initiatives. Ravi will walk through our financials in greater detail, and then I'll come back to close. I'll start with a quick overview of our results. Real delivered another impressive first quarter, and I think the numbers speak for themselves. Revenue of $466 million, up 32%. Operating loss of $3.4 million improved by $1.8 million year-over-year.
Adjusted EBITDA of $14.9 million increased 80%, and our unrestricted cash and investments balance increased by $30 million in the quarter to a record $62.9 million. All of this occurred in one of the softest markets we've seen in years. U.S. existing home sales were essentially flat at trough levels, and Canadian home sales activity declined mid- to high-single digits. Despite this, our agents closed nearly 42,000 transactions, up 25% year-over-year. Gross profit grew faster than operating expenses, and adjusted EBITDA grew 2.5x faster than revenue. That is the model working exactly as we designed. We ended the first quarter with approximately 33,500 agents.
And as of May 6, that number has grown to over 33,900. This is happening while agents across the industry are struggling, transaction volumes are down and productivity is under pressure. The fact that we are both growing rapidly and improving retention in that environment demonstrates the value the platform delivers for agents. On our ancillary businesses, the progress we're making is starting to become very tangible. On Real ...
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