Despite ongoing legal woes and a drop in agents, virtual national brokerage eXp reported year-over-year revenue and profit growth in its Q1 2024 earnings call on Wednesday. Transactions also increased 8% to 110,976 year-over-year, the company reported.
“During the first quarter, our agents closed over $37 billion of transactions, a 12% year-over-year increase, underscoring eXp’s unparalleled scale in the cloud brokerage market we pioneered,” said Glenn Sanford, eXp World Holdings founder, chairman and CEO, on the call. “We continue to provide our agents with the industry’s best platform for growth and the resources they need to navigate today’s dynamic real estate market.”
From the same time period a year ago, revenue has jumped a notable 11% to $943 million, primarily from an increase in agent productivity, despite a current lackluster real estate market.
And while transactions and revenue have increased year-over-year, the firm reported that 85,780 agents were on the platform at the end of March, which is a 2% decline from a year ago, and a drop of 1,730 from Q4 of 2023. On the earnings call, the company said that the exit is “driven by the exiting of non-productive agents.”
Whether this is a consistent coincidence or simply a newfound trend for the company is unknown, but it is worth noting that a continual drop will prove to contradict goals set by Sanford, explaining back in 2021 at EXPCON, that the hope was to potentially expand to 500,000 agents in coming years—a high expectation, especially in the midst of growing uncertainty among agents in the post-Burnett landscape.
But in some related news made public via a press release just prior to the call Wednesday, eXp announced new aspects to its revenue-share program. One of the changes consists of a bonus for agents that recruit peers, and a handful of other changes that are in place to drive agent earnings—something likely implemented to attract agents to a new business model, and help agent count grow to what eXp once hoped was realistic.
One other positive takeaway: Sales volume was up 12% in Q1, reaching $37 billion. eXp still faced a net loss of $15.6 million compared to the $1.5 million net income from last year’s first quarter. There was a $16 million (net of tax, 11.4 million) “antitrust litigation contingency provision,” according to the earnings call.
Sanford remained hopeful surrounding eXp’s future, as shown in the report, and didn’t seem concerned with things like net loss or agent drop. He believes, “Under Leo Pareja’s (eXp realty president) leadership, I am confident that eXp Realty will extend its leadership position in the coming years and continue to redefine what it means to be the most agent-centric real estate brokerage on the planet.”
Sanford briefly discussed the commission lawsuits circulating through the industry in yesterday’s investor call, and mentioned that through the 10 suits brought against eXp, it’s unclear whether or not there will be consolidation of those cases, but the brokerage is not currently looking to settle.
“I think we’re maybe the last of the large brokerages that haven’t settled yet and are presently not in a settlement discussion at the moment. But obviously, we’re open to those conversations. We’ve had some in the past. But right now, we’re still looking at what’s going on,” he said.
“So we’re watching on a day-by-day basis,” Sanford continued, “And if there’s an opportunity to settle for a number that makes sense for us, then we’ll take that opportunity. But if not, we think we’ve got very good arguments on our side of the equation if we were to go sort of the distance, so to speak.”
