REMAX Holdings’ first earnings report since agreeing to be acquired by The Real Brokerage showed the franchisor’s core North American operations remain under pressure even as its global agency count continues to grow. The results provide more detail about the business Real, which is one of the best-known brands in residential real estate with a global franchise network and about 150,000 agents, is still under pressure in the U.S. and Canada.
In an SEC filing released Friday, the Denver-based franchisor reported first-quarter revenue of $70.2 million, which was $53.4 million, down 5.7 percent, or 4 percent, from the year-ago period, excluding fees collected for marketing programs. Adjusted EBITDA decreased 19.3% to $15.6 million. REMAX also reported a net loss attributable to the company of $9.7 million. This compares to a loss of $2 million in the first quarter of 2025. Adjusted earnings per share decreased to $0.16 from $0.24 in the prior-year period.
The company does not plan to hold a quarterly earnings call and said it does not plan to hold one in future quarters pending the merger with Real. REMAX also said it does not intend to provide quarterly or annual guidance during this period and that the transaction is expected to close in the second half of 2026, pending regulatory and shareholder approvals.
REMAX’s total number of agents increased 2.1% year over year to 149,192. However, this growth was driven by markets outside the US and Canada, where the number of agents increased by 6.7% to 75,900. In the US, REMAX agent count decreased 4.8% to 47,443. The number of agents in the U.S. and Canada combined decreased by 2.3% to 73,292. The company’s number of US offices also decreased by 4.7% from the same period last year, from 3,080 to 2,935.
REMAX attributes some of the revenue decline to changes to its standard pricing model, including its Aspire and Ascend programs, and a reduction in the number of U.S. distributors. Ordinary revenue, which includes recurring franchise fees and annual fees, decreased by 10.2% year-on-year. Continuing franchise fees alone decreased from $29.4 million to $25.8 million.
Motto Mortgage’s footprint continues to shrink
The pressure also extended to REMAX’s mortgage franchise business, even though Real executives pointed to mortgage lending as a potential source of future upside given the combined deal base.
REMAX’s Motto Mortgage open offices decreased by 29.9% year-on-year, from 224 locations to 157 locations. The company announced that it continues to lay off Motto franchisees who have received significant financial relief or are experiencing financial distress, including 13 Motto franchisees in the first quarter. The number of offices receiving short-term financial relief decreased to 22 from 58 in the same period last year.
Real CEO Tamir Poleg told investors on an earnings call this week that the Real and REMAX networks combined closed more than 700,000 U.S. transaction sides last year, creating potential upside for the company’s mortgage, title and fintech businesses. Mr. Poleg estimated that a 1% mortgage accretion rate across this base would generate approximately $25 million in high-margin income for the combined company.
Mr. Poleg also pointed to the productivity of REMAX agents, noting that the average REMAX agent closes more than 10 deals per year, which is approximately double the industry average and the average for Real’s own agents.
Real investors raise debt issues
The results also draw renewed attention to how Real plans to deal with REMAX’s debt, which has emerged as one of the key financial issues surrounding the merger. REMAX ended the quarter with a debt balance of $436 million, less unamortized debt discount and issuance costs, compared to $436.8 million at year-end 2025. In contrast, Real ended the quarter debt-free with $62.9 million in unrestricted cash and short-term investments.
During Real’s earnings call on Thursday, CFO Ravi Jani answered the most-voted question asked through Real’s retail investor Q&A portal: whether the company is concerned about taking on REMAX’s debt and how long it expects to pay it back.
Jani said Real was approaching leverage “very carefully,” adding that both businesses are asset-light and cash-generating businesses. He said REMAX’s franchise recurring revenue provides visibility into future free cash flow and that deleveraging will be the top priority for post-merger capital allocation.
Jani said Real expects to double its net debt-to-adjusted EBITDA by the end of its second full year after closing. He also said that the combined company’s leverage will be lower than REMAX’s standalone leverage on a net leverage basis.
Operating under trading period constraints
When Real and REMAX announced their merger agreement on April 26, leaders indicated that the deal was expected to close in the second half of 2026, subject to shareholder and regulatory approvals. Once completed, the newly combined Real ReMax Group will rank among the top three companies in the real estate industry by size, behind Compass International Holdings and Keller Williams.
Real executives say their three biggest priorities before closing are retaining agents and franchisees, ensuring operational stability from day one, and realizing $30 million in expected run-rate savings from duplicative overhead and corporate costs.
REMAX’s latest quarterly report also identified risks associated with the transaction, including the possibility that the merger and its announcement could adversely impact the company’s ability to retain its agents, franchisees and talent. The filing also warns that the transaction could distract management, lead to unexpected costs and litigation, and limit REMAX’s ability to pursue certain business opportunities and strategic transactions while the merger is pending.
Although the company had $62.5 million remaining under its existing $100 million stock repurchase authorization at the end of the quarter, REMAX did not conduct any stock repurchases during the first quarter and is restricted from repurchasing without Real’s approval while the transaction is pending.
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