RE/MAX Holdings, Inc. Q1 FY2025 earnings call

• Erik Carlson noted the first quarter had higher than expected revenue, margins, and profits, with the team focusing on operational excellence. He discussed macroeconomic uncertainty in the real estate market, the National Association of Realtors' modified Clear Cooperation Policy, and RE/MAX's stance on transparency. - Highlights included new initiatives like the refreshed RE/MAX logo, MAX/Engage social influencer platform, global marketing platform, Max/Tech Lead Concierge Program, AI-powered website enhancements, HomeView app, Max/Refer referral system, and the Aspire onboarding program. - Karri Callahan mentioned solid top-line performance from broker fee revenue, lower than anticipated expenses leading to improved margins, and discussed revenue breakdown excluding marketing funds, expense management, and cash flow.

Total revenue for the first quarter was $74.5 million. Adjusted EBITDA was $19.3 million, up 1.5% over Q1 of last year. Adjusted EBITDA margin was 25.9%, an increase of 164 basis points over Q1 2024. Excluding marketing funds, revenue was $55.6 million, a decrease of 4.3% compared to the same period last year due to negative organic growth of 3.2% and adverse foreign currency movements of 1.1%.

• For Q2 2025, expect agent count to increase 1.5% to 2.5% over Q2 2024, revenue in $70 million to $75 million (including marketing funds $17 million to $19 million), and adjusted EBITDA in $22.5 million to $25.5 million. - For full-year 2025, expect agent count range from negative 1% to positive 1% over full year 2024, revenue in $290 million to $310 million (including marketing funds $71 million to $75 million), and adjusted EBITDA in $90 million to $100 million.

Forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from projections. These are discussed in the first quarter 2025 financial results press release and other SEC filings.

Q: Anthony Paolone asked about franchise sales decline and margin growth.

A: Karri Callahan said it was due to annual conference attendance down and Gadberry wind down, but margin performance continued to increase. Erik Carlson talked about industry consolidation and valuations.

Q: Nick McAndrew asked about Aspire program's competitive positioning.

A: Erik Carlson said Aspire helps brokers recruit agents, widens the top of the funnel, and opens up new opportunities.

Q: Stephen Sheldon asked about revenue growth and margin reinvestment.

A: Karri Callahan said focus is on value proposition, and Erik Carlson mentioned purposeful investments for return on capital.

Q: John Campbell asked about international agent growth and pricing.

A: Erik Carlson said momentum is from outstanding operators and brand, with additional opportunities in marketing services.

Q: Tommy McJoynt asked about RE/MAX's agent market share and NAR's clear cooperation policy.

A: Karri Callahan said agents are more productive, and Erik Carlson said RE/MAX stands for consumer transparency and broad listing distribution.