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    REAX
    Earnings call· Jun 2026(Q2 FY26)

    Real Brokerage Q2 FY26 earnings call REAX

    Aug 6, 2026 Source

    Executive summary

    The Real Brokerage Inc. Q2 FY26 — Strong Growth and Profitability Ahead of RE/MAX Merger

    The Real Brokerage delivered significant growth and improved core profitability in Q2 FY26, driven by market share gains and agent productivity, despite a challenging housing market. The company is progressing towards its proposed merger with RE/MAX, which is expected to close in H2 2026, aiming for substantial cost synergies and an enhanced technology platform. Management remains focused on innovation and agent support to drive long-term value, independent of market conditions.

    Highlights

    5

    • Revenue increased 30% year-over-year to over $700 million.

    • Adjusted EBITDA increased 38% year-over-year to $27.6 million.

    • Agent count grew 26% year-over-year to approximately 35,350, exceeding 36,000 as of the call date.

    • Ended the quarter with a record $86.6 million in unrestricted cash and short-term investments.

    • Ancillary revenue grew 28% year-over-year to $4.2 million, with Real Wallet up 140%.

    Concerns

    3

    • Gross margin declined to 8.3% from 8.9% in the prior year, primarily due to a mix effect from more post-cap transactions.

    • Reported operating loss of $7 million, compared to operating income of $1.7 million in Q2 2025, due to $11.6 million in acquisition-related costs.

    • Canadian market showed weakness, with average transactions per agent down 9% year-over-year.

    Guidance & targets

    7
    CategoryTargetConfidence
    Cost synergies from RE/MAX transaction
    $30 million
    high materiality
    High
    Q3 FY26 Revenue
    declining sequentially from the second quarter
    medium materiality
    High
    Q3 FY26 Adjusted EBITDA
    declining sequentially from the second quarter
    medium materiality
    High
    Q3 FY26 Gross Margin
    lower year-over-year
    medium materiality
    High
    Q4 FY26 Gross Margin
    relatively flat year-over-year
    medium materiality
    Medium
    Combined Company 2027 Guidance
    preliminary 2027 guidance
    high materiality
    High
    Post-RE/MAX Closing Capital Allocation
    prioritize debt repayment and deleveraging
    high materiality
    High

    Operational metrics

    22
    Agent Count
    35,350up 26% year-over-year
    Q2 FY26 end
    Closed Transactions
    62,380up 27% year-over-year
    Q2 FY26
    Average Agent Productivity
    up 3%
    Q2 FY26
    Average Agent Productivity
    down 9%
    Q2 FY26
    Average Revenue per Transaction
    up 2%
    Q2 FY26
    Ancillary Revenue
    $4.2 millionup 28% year-over-year
    Q2 FY26
    Real Wallet Revenue Growth
    140%year-over-year
    Q2 FY26
    One Real Title Revenue Growth
    29%year-over-year
    Q2 FY26
    One Real Mortgage Revenue Growth
    10%year-over-year
    Q2 FY26
    Gross Profit
    $58.3 millionup 22% year-over-year
    Q2 FY26
    Gross Margin
    8.3%vs 8.9% in prior year
    Q2 FY26

    Decline primarily due to mix effect from higher proportion of post-cap transactions.

    Capped Agents in Closed Transactions
    42%up 300 basis points year-over-year
    Q2 FY26
    Total Operating Expenses
    $65.3 million
    Q2 FY26
    Acquisition-Related Costs
    $11.6 million
    Q2 FY26

    Associated with the pending RE/MAX transaction.

    Adjusted EBITDA
    $27.6 millionup 38% year-over-year
    Q2 FY26
    Adjusted EBITDA Margin
    3.9%from 3.7% in prior year
    Q2 FY26
    Unrestricted Cash and Short-term Investments
    $86.6 millionup from $49.9 million at start of year
    Q2 FY26 end

    Record level.

    HeyLeo MLS Coverage
    close to 90%
    current
    Title JV Attach Rate
    45%
    Q2 FY26
    Title Company-wide Attach Rate
    3.24%
    Q2 FY26
    Highest Title JV Attach Rate
    67-80%
    Q2 FY26
    US Existing Home Sales (market context)
    ~4 million20% below typical 5.2 million
    past 3 years

    Industry KPIs

    1
    MetricValueDetails
    Mortgage origination loan servicing10%%

    Deals & partnerships

    1
    RE/MAXAcquisition of RE/MAX, combining an iconic global brand with Real's modern AI-enabled technology platform and economic model.

    Aims to better support real estate professionals, improve buyer/seller experience, and build a stronger, more profitable company. Integration management office established, leaders identified, third-party advisors engaged.

    Risks & headwinds

    4
    Challenging Housing Marketpast 3 years

    US existing home sales running ~4 million, 20% below typical 5.2 million.

    Mitigation: Focus on taking market share, attracting productive agents, increasing ancillary adoption, expanding margins, and innovation.

    Canadian Market WeaknessQ2 FY26

    Average transactions per agent down 9% in Canada.

    Mitigation: Agent count continues to grow in Canada, opening new provinces.

    Gross Margin CompressionQ2 FY26

    Gross margin 8.3% vs 8.9% prior year; 42% of closed transaction sides from capped agents, up 300 bps YoY.

    Mitigation: Considered a 'right trade-off' for retaining high-producing agents; fee model changes in September and pickup in ancillary businesses expected to moderate future declines.

    Acquisition-Related CostsQ2 FY26

    $11.6 million

    Mitigation: These are one-time costs related to the merger, expected to lead to synergies and long-term profitability.

    What to watch in Q3 FY26

    5

    RE/MAX Transaction Closing

    H2 2026
    CurrentSecurity holder vote scheduled for August 14
    TargetTransaction closed

    Why it matters

    The closing of this acquisition is foundational to the company's future strategy, growth, and synergy realization.

    Our security holder vote on the RE/MAX transaction is scheduled for August 14. Assuming approval by both Real security holders and RE/MAX's shareholders and satisfaction of the remaining closing conditions, we expect to complete the transaction thereafter in the second half of 2026.

    Q&A highlights

    6

    How is the agent recruiting pipeline looking, and has the pending RE/MAX merger affected it (positively or negatively)?

    Q2 saw robust agent adds, and the RE/MAX deal announcement provided tailwinds, leading to a strong pipeline and over 36,000 agents currently. The focus is on attracting agents from outside the combined Real/RE/MAX group.

    “I think that the announcement of the RE/MAX deal definitely gave us some tailwinds in terms of agents reaching out or teams reaching out and contemplating joining Real. So I think that all in all, it is a positive.”

    asked by Stephen Sheldon · answered by Tamir Poleg

    2 min read5 chapters

    Detailed Narrative

    01

    RE/MAX Transaction Update

    The proposed merger with RE/MAX is a pivotal step for The Real Brokerage, with the security holder vote scheduled for August 14. The transaction is expected to close in H2 2026, assuming necessary approvals and satisfaction of closing conditions. This combination aims to leverage RE/MAX's global brand and agent network with Real's AI-enabled technology and economic model, targeting approximately $30 million in cost synergies within three years of closing.

    02

    Agent Growth and Productivity

    The company continues to attract productive real estate professionals, ending Q2 FY26 with approximately 35,350 agents, representing a 26% year-over-year increase. As of the call date, the agent count has already exceeded 36,000. This growth, coupled with a 1% improvement in average agent productivity and a 2% increase in average revenue per transaction, demonstrates the company's ability to gain market share even in a challenging housing market.

    03

    HeyLeo 2.0 and AI Integration

    HeyLeo, Real's AI relationship management platform for agents, is evolving with the recent beta launch of Leo 2.0. This new version integrates with major real estate CRMs, allowing agents to leverage AI for lead nurturing, consistent client engagement, and identifying when clients are ready to act. Early feedback from over 200 beta agents has been overwhelmingly positive, with Leo generating revenue opportunities from dormant leads, and the company plans to make this technology available to all agents once fully rolled out.

    04

    Ancillary Services Momentum

    Ancillary revenues from Real Wallet, One Real Title, and One Real Mortgage grew a combined 28% year-over-year to $4.2 million in Q2 FY26. Real Wallet saw a 140% growth, One Real Title 29%, and One Real Mortgage 10%. While these services remain relatively small, the company sees significant momentum in mortgage and expects revenue manifestation in late 2026 or early 2027. The integration of mortgage and title flows into HeyLeo is anticipated to further boost these high-margin services.

    05

    Operational Efficiency and Headcount

    The Real Brokerage maintains a lean operating cost structure by aggressively investing in AI to automate internal operations. An in-house AI automation team has automated hundreds of workflows, saving thousands of hours of manual work across various departments. Recent headcount increases were primarily due to converting contract roles, such as state brokers and compliance specialists, to full-time employees, a move that is P&L neutral and aims to better serve agents and drive attach rates for ancillary services.

    AI-generated summary of the company’s earnings call. Not investment advice.