eXp, a brokerage that saw some of the most spectacular expansion during the pandemic as agents flocked to its mostly virtual model, saw growth slow in a much more challenging real estate market in the first half of 2022, announcing a cash dividend and stock buyback as the company still reported strong agent, revenue and transaction increases.
“During the second quarter, eXp continued to increase its marketshare and revenue to record levels, reinforcing that our model was built for all market conditions and that our agent value proposition resonates around the world,” said Glenn Sanford, founder, chairman and CEO of eXp, in a statement.
Revenue came in at $1.41 billion, up 42% year-over-year, and eXp’s agent count grew an identical 42%, to a total of 82,856 as of June 30. Closed transactions were up 30%, even as net income fell significantly, from $37 million in Q2 2021 to $9.4 million. eXp claimed that this was due to a one-time VA allowance and reduction in stock-based compensation.
Net income for the first half of the year was $18.2 million, down from $41.9 million in the first half of 2021. The stock repurchase came in at $50 million, and the dividend (for Q3 2022) is equal to $0.045 per share.
eXp stock, which has been battered most of the year, was down nominally in early trading, 2.5% at the opening bell.
Having built his brokerage model on the concept of eliminating physical office space and pushing everything into a customizable, persistent virtual world, Sanford and eXp had a massive head start when the pandemic pushed nearly every real estate company to go remote.
The company saw agent count increase 77% and revenue grow a staggering 115% between Q1 2020 and Q1 2021, and its stock ballooned almost 2,000% during roughly that same period. But how the company operates in a more difficult market is a question that has only partially been answered, with many economists and experts expecting more pain for real estate going forward.
Sanford continued to be bullish on growth, however, highlighting a tech acquisition he claimed will provide “an exponential boost” to agents in Canada, where the company is expanding. eXp also entered the New Zealand market this quarter.
“We are leveraging our core strengths of agent satisfaction and innovation as we continue to redefine the real estate industry,” Sanford added.
CFO Jeff Whiteside was equally confident while still noting the “challenging” market conditions ahead.
“We expect our focus on affiliated services and technology will further strengthen our agent and customer value proposition,” he said in a statement. “We remain confident in our ability to deliver profitable, sustainable growth over the long term.”