The Real Brokerage’s first quarter was marked by revenue growth and narrowing losses, but a negative market reaction indicated investor caution. Management attributed the strong results to substantial agent recruitment, with agent count rising 61% and transaction volume outpacing a declining industry backdrop. CEO Tamir Poleg emphasized, “Our agents delivered a 5% year-over-year increase in average transactions per agent, a clear signal that our agents are well equipped to navigate this market with skill and focus.” Growth in high-margin ancillary services, such as mortgage, title, and Real Wallet, also contributed to performance, though profitability remained pressured by a higher proportion of top-producing agents reaching commission caps.
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The Real Brokerage (REAX) Q1 CY2025 Highlights:
- Revenue: $354 million vs analyst estimates of $332.9 million (76.3% year-on-year growth, 6.3% beat)
- EPS (GAAP): -$0.02 vs analyst estimates of -$0.05 ($0.02 beat)
- Adjusted EBITDA: $8.28 million vs analyst estimates of $5.81 million (2.3% margin, 42.4% beat)
- Operating Margin: -1.5%, up from -3.2% in the same quarter last year
- Market Capitalization: $907.3 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions The Real Brokerage’s Q1 Earnings Call
- Darren Aftahi (ROTH Capital Partners) asked about metrics for Leo CoPilot’s impact on agent productivity. CEO Tamir Poleg explained that while Leo currently automates agent support, metrics on its impact for client-facing productivity are still in development.
- Darren Aftahi (ROTH Capital Partners) also inquired about trends in gross margins given the rise in capped agents. CFO Ravi Jani acknowledged ongoing margin pressure but pointed to upcoming fee changes and ancillary service growth as offsetting factors.
- Stephen Sheldon (William Blair) asked about future applications of voice AI for agents. Poleg described plans for Leo to handle agent-specific voice calls and even client interactions, seeing this as a major future differentiator.
- Stephen Sheldon (William Blair) questioned drivers of outlier agent recruitment. Ravi Jani attributed it to Real’s mix of value, technology, and flexibility, rather than a single standout initiative.
- Matthew Erdner (JonesTrading) inquired about onboarding and pipeline strength. Both Poleg and Jani noted a robust agent pipeline and smoother onboarding, supported by additional investment in agent success teams.
Catalysts in Upcoming Quarters
In future quarters, the StockStory team will monitor (1) the rollout and agent adoption of advanced Leo CoPilot AI features, particularly in client-facing use cases; (2) the revenue contribution and user growth from Real Wallet and other ancillary services as new product integrations come online; and (3) any margin improvement resulting from fee program changes and the scaling of higher-margin business lines. The pace of agent recruitment and onboarding efficiency will also be important signposts for sustained growth.
The Real Brokerage currently trades at $4.45, in line with $4.46 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).
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