Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• eXp World Holdings Inc (NASDAQ:EXPI) reported a 2% increase in revenue year-over-year, reaching $1.231 billion, driven by higher real estate sales volume and increased agent productivity.
• The company's international revenue grew by 63%, indicating strong performance and expansion in global markets.
• eXp World Holdings Inc (NASDAQ:EXPI) achieved an agent net promoter score (NPS) of 76, reflecting high agent satisfaction and loyalty.
• The company has successfully attracted high-performing independent brokers and teams, strengthening its market position.
• eXp World Holdings Inc (NASDAQ:EXPI) is leveraging AI technology to enhance agent productivity and operational efficiency, showcasing its commitment to innovation.

Negative Points

• The agent count decreased by 4% year-over-year, attributed to challenging market conditions and strategic decisions to remove unproductive agents.
• Real estate sales transaction units declined by 1% year-over-year, indicating a slight drop in transaction volume.
• General and administrative expenses increased by 2% due to higher employee-related expenses and legal costs associated with an antitrust lawsuit.
• The company recorded a GAAP net loss of $8.5 million, impacted by an $18 million antitrust contingency provision.
• Despite international revenue growth, the agent count in international markets remained flat, highlighting challenges in expanding the agent base.

Q & A Highlights

• Warning! GuruFocus has detected 8 Warning Signs with EXPI.

Q: Can you talk about why you decided to expand into Turkey, Peru, and Egypt in particular? A: Glenn Sanford, CEO, explained that the expansion into these countries was driven by strong leadership opportunities. In Peru, they have a great partner, Ricardo, and in Turkey, they have a leader with a strong real estate background. In Egypt, Ahmad is well-connected and has been building the MLS. The focus is on following leadership rather than just market potential.

Q: What's driving the decrease in agent count? A: Leo Pere, CEO of eXp Realty, noted that macroeconomic factors have led to a decrease in agent count, with many agents leaving the industry entirely. However, retention among more productive agents has improved, and the company is focusing on attracting high-performing agents through various incentive programs.

Q: Can you discuss the timeline and budget for evolving the eXp brand and how you measure success? A: Wendy Forsyth, CMO, stated that the brand update, referred to as the "Glow Up," is complete, but the brand will continue to evolve. Success is measured through both subjective art and objective science, focusing on metrics like share of voice and social media analytics.

Q: What is your stance on the NAR's clear cooperation policy? A: Leo Pere expressed strong support for the policy, emphasizing its importance in maintaining a complete, liquid, and accurate real estate system in North America. He highlighted the benefits for consumers and the reasonable marketing costs it ensures.

Q: Can you give a general update on international trends and expectations for 2025? A: Glenn Sanford highlighted that international revenue is up significantly year-over-year, despite flat agent count. The focus has shifted to productive agent count, and more countries are expected to be announced. Investments in international expansion will continue, with a focus on building strong leadership and enhancing agent value propositions.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.