Item 1. Financial Statements
Item 1. FINANCIAL STATEMENTS (UNAUDITED)
EXP WORLD HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
(UNAUDITED)
March 31, 2026
December 31, 2025
ASSETS
CURRENT ASSETS
Cash and cash equivalents
$ 122,149
$ 124,245
Restricted cash
68,210
57,218
Accounts receivable, net of allowance for credit losses of $ 2,539 and $ 2,690 , respectively
123,176
108,838
Prepaids and other assets
15,142
14,567
TOTAL CURRENT ASSETS
328,677
304,868
Property and equipment, net
15,149
14,314
Other noncurrent assets
23,106
23,495
Intangible assets, net
3,413
4,421
Deferred tax assets, net
79,186
77,510
Goodwill
17,635
17,872
TOTAL ASSETS
$ 467,166
$ 442,480
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Accounts payable
$ 13,529
$ 14,613
Customer deposits
68,224
57,204
Accrued expenses
110,753
108,208
Litigation contingency
17,000
17,000
Other current liabilities
1,760
2,676
TOTAL CURRENT LIABILITIES
211,266
199,701
TOTAL LIABILITIES
211,266
199,701
EQUITY
Common Stock, $ 0.00001 par value 900,000,000 shares authorized; 211,059,707 issued and 164,323,924 outstanding at March 31, 2026 and 207,785,762 issued and 161,049,979 outstanding at December 31, 2025
2
2
Additional paid-in capital
1,133,497
1,105,434
Treasury stock, at cost: 46,735,783 shares held at March 31, 2026 and December 31, 2025
( 742,879 )
( 742,879 )
Accumulated earnings (deficit)
( 134,690 )
( 121,622 )
Accumulated other comprehensive income (loss)
( 30 )
1,844
TOTAL EQUITY
255,900
242,779
TOTAL LIABILITIES AND EQUITY
$ 467,166
$ 442,480
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EXP WORLD HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In thousands, except share amounts and per share data)
(UNAUDITED)
Three Months Ended March 31,
2026
2025
Revenues
$ 1,005,541
$ 954,906
Commissions and other agent-related costs
930,194
878,771
Gross profit
75,347
76,135
Operating expenses
General and administrative expenses
64,213
66,871
Technology and development expenses
17,595
16,805
Sales and marketing expenses
2,327
2,835
Total operating expenses
84,135
86,511
Operating income (loss)
( 8,788 )
( 10,376 )
Other (income) expense
Other (income) expense, net
( 268 )
( 943 )
Equity in (income) losses of unconsolidated affiliates
130
( 80 )
Other (income) expense, net
( 138 )
( 1,023 )
Income (loss) before income tax expense
( 8,650 )
( 9,353 )
Income tax (benefit) expense
( 3,552 )
1,671
Net income (loss)
($ 5,098 )
($ 11,024 )
Earnings (loss) per share
Basic, net income (loss)
($ 0.03 )
($ 0.07 )
Diluted, net income (loss)
($ 0.03 )
($ 0.07 )
Weighted average shares outstanding
Basic
162,017,200
154,738,167
Diluted
162,017,200
154,738,167
Comprehensive income (loss):
Net income (loss)
($ 5,098 )
($ 11,024 )
Other comprehensive income (loss):
Foreign currency translation gain (loss), net of tax
( 1,874 )
313
Comprehensive income (loss)
($ 6,972 )
($ 10,711 )
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EXP WORLD HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands)
(UNAUDITED)
Three Months Ended March 31,
2026
2025
Common stock:
Balance, beginning of period
$ 2
$ 2
Balance, end of period
2
2
Treasury stock:
Balance, beginning of period
( 742,879 )
( 686,680 )
Repurchases of common stock
-
( 4,982 )
Balance, end of period
( 742,879 )
( 691,662 )
Additional paid-in capital:
Balance, beginning of period
1,105,434
962,758
Shares issued for stock options exercised
21
300
Agent growth incentive stock-based compensation
8,106
7,497
Agent equity stock-based compensation
18,555
20,756
Other stock-based compensation
1,381
1,853
Balance, end of period
1,133,497
993,164
Accumulated earnings (deficit):
Balance, beginning of period
( 121,622 )
( 68,135 )
Net income (loss)
( 5,098 )
( 11,024 )
Dividends declared and paid ($ 0.05 per share of common stock)
( 7,970 )
( 7,602 )
Balance, end of period
( 134,690 )
( 86,761 )
Accumulated other comprehensive income (loss):
Balance, beginning of period
1,844
( 3,076 )
Foreign currency translation gain (loss)
( 1,874 )
313
Balance, end of period
( 30 )
( 2,763 )
Total equity
$ 255,900
$ 211,980
The accompanying notes are an integral part of these condensed consolidated financial statements.
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EXP WORLD HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(UNAUDITED)
Three Months Ended March 31,
2026
2025
OPERATING ACTIVITIES
Net income (loss)
($ 5,098 )
($ 11,024 )
Reconciliation of net income (loss) to net cash provided by operating activities:
Depreciation expense
1,679
1,945
Amortization expense - intangible assets
643
616
Credit (benefit) losses on receivables/bad debt on receivables
( 151 )
605
Equity in loss of unconsolidated affiliates
165
( 80 )
Agent growth incentive stock-based compensation expense
9,073
8,119
Other stock-based compensation
1,446
1,853
Agent equity stock-based compensation expense
18,555
20,756
Deferred income taxes, net
( 1,675 )
( 1,509 )
Changes in operating assets and liabilities:
Accounts receivable
( 14,023 )
( 15,808 )
Prepaids and other assets
( 575 )
( 2,963 )
Customer deposits
11,020
11,685
Accounts payable
( 1,083 )
( 369 )
Accrued expenses
1,512
25,828
Other operating activities
( 917 )
184
NET CASH PROVIDED BY OPERATING ACTIVITIES
20,571
39,838
INVESTING ACTIVITIES
Purchases of property and equipment
( 2,514 )
( 2,553 )
Investments in unconsolidated affiliates
60
( 11,244 )
Capitalized software development costs in intangible assets
365
( 450 )
NET CASH USED IN INVESTING ACTIVITIES
( 2,089 )
( 14,247 )
FINANCING ACTIVITIES
Repurchase of common stock
-
( 4,982 )
Proceeds from exercise of options
21
300
Dividends declared and paid
( 7,970 )
( 7,602 )
NET CASH USED IN FINANCING ACTIVITIES
( 7,949 )
( 12,284 )
Effect of changes in exchange rates on cash, cash equivalents and restricted cash
( 1,637 )
329
Net change in cash, cash equivalents and restricted cash
8,896
13,636
Cash, cash equivalents and restricted cash, beginning balance
181,463
168,588
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE
$ 190,359
$ 182,224
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION:
Cash paid for income taxes
1,397
1,480
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING ACTIVITIES:
Property and equipment purchases in accounts payable
177
214
The accompanying notes are an integral part of these condensed consolidated financial statements.
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eXp World Holdings, Inc.
Notes to the Condensed Consolidated Financial Statements
(UNAUDITED)
(Amounts in thousands, except share amounts and per share data or as noted otherwise)
1.
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
eXp World Holdings, Inc. (the “Company” or “eXp”) operates a cloud-based real estate brokerage and provides related services supporting real estate agents, brokers, and entrepreneurs across North America and international markets through three reportable segments: North American Realty, International Realty, and Other Affiliated Services.
The accompanying consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”), expressed in U.S. dollars, and the Company’s fiscal year ends on December 31. The preparation of these consolidated financial statements and accompanying notes in conformity with U.S. GAAP requires the use of management estimates.
These interim financial statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s 2025 Annual Report.
In management’s opinion, these interim financial statements reflect all normal recurring adjustments necessary for a fair presentation and are not necessarily indicative of results expected for the full year ending December 31, 2026.
2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, and entities in which the Company has a variable interest of which the Company is the primary beneficiary. If the Company has a variable interest in an entity but it is not the primary beneficiary of the entity or does not exercise control over the operations and has less than 50% ownership, it will use the equity or cost method of accounting for investments.
Joint ventures
A joint venture is a contractual arrangement whereby the Company and other parties undertake an economic activity through a jointly controlled entity. Joint control exists when strategic, financial and operating policy decisions relating to the activities require the unanimous consent of the parties sharing control. Joint ventures are accounted for using the equity method and are recognized initially at cost. Joint ventures are typically included in the Other Affiliated Services unless the joint venture specifically supports one of the other reportable segments.
Investments in Equity Securities
We hold investments in certain equity securities that do not have readily determinable fair values and for which we do not exercise significant influence. These investments qualify for and are accounted for using the measurement alternative under Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 321, Investments (“ASC 321”).
Use of Estimates
Preparing financial statements under U.S. GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures. Key areas requiring estimates include credit losses, legal contingencies, revenue recognition, stock-based compensation, and deferred tax assets.
Management bases these estimates on current facts, historical experience, and other reasonable factors. Actual results may differ materially and adversely from these estimates, which could affect future results of operations.
Reclassifications
When necessary, the Company will reclassify certain amounts in prior period financial statements to conform to the current period’s presentation. The Company maintains a consistent presentation across all periods presented.
Restricted cash
Restricted cash consists of cash held in escrow by the Company on behalf of real estate buyers. The Company recognizes a corresponding customer deposit liability until the funds are released. Once the cash transfers from escrow, the Company reduces the respective customers’ deposit liability.
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The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same amounts shown on the condensed consolidated statements of cash flows.
Cash and cash equivalents
Restricted cash
Total
Balance, March 31, 2025
$ 115,655
$ 66,569
$ 182,224
Balance, December 31, 2025
$ 124,245
$ 57,218
$ 181,463
Balance, March 31, 2026
$ 122,149
$ 68,210
$ 190,359
3.
EXPECTED CREDIT LOSSES
The Company evaluates expected credit losses using an aging schedule and records an allowance when amounts are determined to be uncollectible.
As of March 31, 2026 and December 31, 2025, the Company recognized expected credit losses of $ 47 and $ 82 , respectively.
4.
PROPERTY AND EQUIPMENT, NET
Property and equipment, net consisted of the following:
March 31, 2026
December 31, 2025
Computer hardware and software
$ 54,885
$ 53,849
Furniture, fixture, and equipment
2,206
2,206
Total depreciable property and equipment
57,091
56,055
Less: accumulated depreciation
( 43,846 )
( 42,184 )
Depreciable property and equipment, net
13,245
13,871
Assets under development
1,904
443
Property and equipment, net
$ 15,149
$ 14,314
For the three months ended March 31, 2026 and 2025, depreciation expense was $ 1,679 and $ 1,945 , respectively.
5.
GOODWILL AND INTANGIBLE ASSETS
Goodwill was $ 17,635 as of March 31, 2026 and $ 17,872 as of December 31, 2025. As of March 31, 2026, the Company recorded cumulative translation adjustment of $( 237 ) related to Canadian goodwill.
Definite-lived intangible assets, net consisted of the following:
March 31, 2026
Gross
Accumulated
Net Carrying
Amount
Amortization
Amount
Trade name
$ 2,059
($ 1,329 )
$ 730
Existing technology
5,632
( 5,294 )
338
Non-competition agreements
470
( 370 )
100
Customer relationships
2,011
( 1,188 )
823
Licensing agreement
210
( 210 )
-
Intellectual property
1,453
( 31 )
1,422
Total intangible assets
$ 11,835
($ 8,422 )
$ 3,413
December 31, 2025
Gross
Accumulated
Net Carrying
Amount
Amortization
Amount
Trade name
$ 2,068
($ 1,262 )
$ 806
Existing technology
5,996
( 4,871 )
1,125
Non-competition agreements
476
( 368 )
108
Customer relationships
2,011
( 1,051 )
960
Licensing agreement
210
( 210 )
-
Intellectual property
1,453
( 31 )
1,422
Total intangible assets
$ 12,214
($ 7,793 )
$ 4,421
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Definite-lived intangible assets are amortized using the straight-line method over an asset’s estimated useful life. Amortization expense for definite-lived intangible assets for the three months ended March 31, 2026 and 2025 was $ 643 and $ 616 , respectively.
6. STOCKHOLDERS’ EQUITY
The following table represents a share reconciliation of the Company’s common stock issued for the periods presented:
Three Months Ended March 31,
2026
2025
Common stock:
Balance, beginning of period
207,785,762
195,028,207
Shares issued for stock options exercised
7,894
56,412
Agent growth incentive stock-based compensation
632,274
446,657
Agent equity stock-based compensation
2,610,047
2,004,995
Other stock-based compensation
23,730
-
Balance, end of period
211,059,707
197,536,271
Dividends
During the three months ended March 31, 2026, cash dividends paid totaled $ 7,970 . The Board currently intends to continue paying quarterly dividends. However, payment of cash dividends is at the discretion of the Board in accordance with applicable law after considering various factors, including our financial condition, operating results, current and anticipated cash needs and plans for growth. Under Delaware law, we can only pay dividends either out of surplus or out of the current or the immediately preceding year’s earnings. Therefore, no assurance is given that we will pay any future dividends to our common stockholders, or as to the amount of any such dividends.
Stock Compensation Programs
Related to the Agent Equity Program, during the three months ended March 31, 2026 and 2025, the Company issued shares of the Company’s common stock to agents and brokers with a value of $ 18,555 and $ 20,756 , respectively, inclusive of discount.
Related to the Agent Growth Incentive Program (“AGIP”), during the three months ended March 31, 2026 and 2025 the Company’s stock-based compensation expense was $ 9,073 and $ 7,922 , respectively, of which the total amount of stock-based compensation attributable to liability classified awards was $ 968 and $ 622 , respectively.
As of March 31, 2026, the total unrecognized compensation costs associated with AGIP, where the performance metric has been achieved and the number of shares awarded are fixed, was $ 58,412 , which is expected to be recognized over a weighted-average period of approximately 2.00 years.
The following table illustrates changes in the Company’s stock-based compensation liability for the periods presented:
Amount
Balance, December 31, 2024
$ 5,045
Stock grant liability increase year to date
2,736
Stock grants reclassified from liability to equity year to date
( 1,999 )
Balance, December 31, 2025
$ 5,782
Stock grant liability increase year to date
968
Stock grants reclassified from liability to equity year to date
-
Balance, March 31, 2026
$ 6,750
Other Restricted Stock Units (“RSUs”)
RSUs may be granted to directors, officers, certain employees and consultants. Each RSU represents the right to receive one share of the Company’s common stock upon vesting, subject to time-based and/or performance-based restrictions. RSUs typically vest over a three-year period with equal and periodically graded vesting or cliff vesting, as applicable. The fair value of RSUs granted is determined based on the closing market price of the Company's common stock on the grant date. The total fair value of RSUs is recognized as stock-based compensation expense over the vesting period, with adjustments for estimated forfeitures.
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During the three months ended March 31, 2026 and 2025, the Company's stock compensation attributable to RSUs was $ 396 and $ 197 , respectively.
As of March 31, 2026, the total unrecognized compensation costs associated with these RSUs was $ 3,124 , which is expected to be recognized over a weighted-average period of approximately 2.14 years.
Stock Option Awards
Stock options are granted to directors, officers, certain employees and consultants with an exercise price equal to the fair market value of common stock on the grant date and the stock options expire 10 years from the date of grant. These options generally have time-based restrictions with equal and periodically graded vesting over a three-year period.
During the three months ended March 31, 2026 and 2025, the Company granted 112,510 and 72,845 stock options, respectively, to employees with an estimated grant date fair value of $ 3.79 and $ 5.66 per share, respectively. The fair values were calculated using a Black Scholes-Merton option pricing model.
Stock Repurchase Plan
The Company’s share repurchase program does not obligate the Company to acquire a minimum amount of shares and it limits the Company’s aggregate repurchases to $ 1.0 billion. Under the program, shares may be repurchased in privately negotiated or open market transactions, including under plans complying with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended. For accounting purposes, common stock repurchased under the stock repurchase program is recorded based upon the trade date of the applicable trade. Such repurchased shares are held in treasury and are presented using the cost method. These shares are considered issued but not outstanding.
During the three months ended March 31, 2026, there were no repurchases of common stock, and no shares were issued from treasury. As of March 31, 2026, and December 31, 2025, the Company held 46,735,783 shares in treasury with a total cost of $ 743 million.
7. SEGMENT INFORMATION
The following table provides information about the Company’s reportable segments and a reconciliation of the total segment revenues to consolidated revenues, commissions and other agent-related costs, and segment adjusted EBITDA to the consolidated income (loss) before income tax expense (benefit) and goodwill (in thousands).
Revenues
Three Months Ended March 31,
2026
2025
North American Realty
$ 965,103
$ 923,048
International Realty
40,152
31,657
Other Affiliated Services
859
827
Commissions reconciliation:
Segment eliminations
( 573 )
( 626 )
Consolidated revenues
$ 1,005,541
$ 954,906
Commissions and other agent-related costs
Three Months Ended March 31,
2026
2025
North American Realty
$ 896,889
$ 852,058
International Realty
33,100
26,373
Other Affiliated Services
205
340
Commissions reconciliation:
Segment eliminations
-
-
Consolidated commissions and other agent-related costs
$ 930,194
$ 878,771
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Operating Income (Loss)
Three Months Ended March 31,
2026
2025
North American Realty
($ 1,611 )
($ 3,824 )
International Realty
( 3,016 )
( 1,921 )
Other Affiliated Services
( 194 )
( 1,643 )
Segment Operating Income (Loss)
( 4,821 )
( 7,388 )
Corporate expenses and other
( 3,967 )
( 2,988 )
Consolidated Operating Income (Loss)
( 8,788 )
( 10,376 )
Adjusted EBITDA
Three Months Ended March 31,
2026
2025
North American Realty
$ 9,963
$ 7,736
International Realty
( 2,421 )
( 1,615 )
Other Affiliated Services
( 130 )
( 1,455 )
Corporate expenses and other
( 3,359 )
( 2,509 )
Consolidated adjusted EBITDA
$ 4,053
$ 2,157
Income (loss) before income tax expense reconciliation:
Depreciation and amortization expense
2,322
2,561
Stock-based compensation expense
9,073
8,119
Other stock-based compensation expense
1,446
1,853
Other (income) expense, net
( 138 )
( 1,023 )
Consolidated income (loss) before income tax expense
($ 8,650 )
($ 9,353 )
Goodwill
March 31, 2026
December 31, 2025
North American Realty
$ 17,635
$ 17,872
International Realty
-
-
Other Affiliated Services
-
-
Segment and consolidated total
17,635
17,872
8. EARNINGS PER SHARE
Basic earnings (loss) per share is computed based on net income (loss) attributable to eXp stockholders divided by the basic weighted-average shares outstanding during the period. Dilutive earnings (loss) per share is computed consistently with the basic computation while giving effect to all dilutive potential common shares and common share equivalents that were outstanding during the period. The Company uses the treasury stock method to reflect the potential dilutive effect of unvested stock awards and unexercised options.
The following table sets forth the calculation of basic and diluted earnings (loss) per share attributable to common stockholders during the periods presented:
Three Months Ended March 31,
2026
2025
Numerator:
Net income (loss)
($ 5,098 )
($ 11,024 )
Denominator:
Weighted average shares - basic
162,017,200
154,738,167
Dilutive effect of common stock equivalents
-
-
Weighted average shares - diluted
162,017,200
154,738,167
Earnings per share:
Net income (loss) per share - basic
($ 0.03 )
($ 0.07 )
Net income (loss) per share - diluted
($ 0.03 )
($ 0.07 )
For three months ended March 31, 2026 and 2025 total outstanding shares of common stock excluded 3,103,669 and 3,424,959 shares, respectively, from the computation of diluted earnings per share because their effect would have been anti-dilutive.
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9 . INCOME TAXES
Our quarterly tax provision is computed by applying the estimated annual effective tax rate to the year-to-date pre-tax income or loss plus discrete tax items arising in the period. Our provision for income tax expense (benefit) amounted to $( 3.6 ) million and $ 1.7 million for the three months ended March 31, 2026 and 2025, respectively, which represent effective tax rates of 41.1 % and ( 17.9 %), respectively. The effective tax rate differs from our statutory rates in both periods primarily due to foreign and domestic mix of earnings, and stock-based compensation.
The Company is subject to a wide variety of tax laws and regulations in the jurisdictions where it operates. U.S. and international tax reform legislation could affect the Company's effective tax rate. The Company continues to monitor the Organisation for Economic Co-operation and Development’s Base Erosion and Profit Shifting (BEPS) framework—including the legislative adoption of Pillar Two and other tax reform legislation by jurisdiction—to evaluate the potential impact on future periods. The Company does not expect the adoption of Pillar Two rules to have a significant impact on its consolidated financial statements in fiscal year 2026.
10 . FAIR VALUE MEASUREMENT
The Company holds funds in a money market account, which are considered Level 1 assets. The Company values its money market funds at fair value on a recurring basis.
As of March 31, 2026 and December 31, 2025, the fair value of the Company’s money market funds was $ 12,507 and $ 12,397 , respectively.
The Company holds investments in equity securities without readily determinable fair values. These investments are accounted for under the measurement alternative method in accordance with ASC 321 . As of March 31, 2026, the carrying value of these investments was $ 12,235 . There were no transfers between levels of the fair value hierarchy, and the Company held no Level 2 financial instruments during the periods presented.
11. COMMITMENTS AND CONTINGENCIES
From time to time, the Company is subject to potential liability under laws and government regulations and various claims and legal actions that may be asserted against us that could have a material adverse effect on the business, reputation, results of operations, cash flows or financial condition. Such litigation includes, but is not limited to, actions or claims relating to cyber-attacks, data breaches, the Real Estate Settlement Procedures Act (“RESPA”), the Telephone Consumer Protection Act of 1991 (“TCPA”) and state consumer protection laws, antitrust and anticompetition, worker classification, timely filing required filings with the Securities and Exchange Commission (the “SEC”), stockholder derivative actions, non-compliance with contractual or other legal obligations, and beginning with the May 2026 acquisition of NextHome, franchise laws and regulations, including the Federal Trade Commission’s Franchise Rule (16 C.F.R. Part 436), state franchise disclosure and registration requirements, and franchise relationship laws governing termination, renewal, and transfer rights.
Antitrust Litigation
The Company and its affiliated brokerage entities are among several defendants in certain sell-side and buy-side class action lawsuits, as detailed below.
Sell-Side Class Action Lawsuits
The Company is currently named in eight U.S. and one Canadian putative sell-side class action lawsuits alleging that the Company participated in a system that resulted in sellers of residential property paying inflated buyer broker commissions in violation of U.S. federal and state antitrust laws and federal Canadian antitrust laws, as applicable.
On December 9, 2024, the Company and certain of its subsidiaries entered into a Settlement Agreement (the “Settlement”) with plaintiffs in the U.S. antitrust lawsuit 1925 Hooper LLC, et al. v. The National Association of Realtors et al., Case No. 1:23-cv-05392- SEG (United States District Court for the Northern District of Georgia, Atlanta Division), which was filed on November 22, 2023 against the Company and other U.S. brokerage defendants (the “Hooper Action”). The Settlement resolves all claims set forth in the Hooper Action and similar claims on a nationwide basis against the Company (collectively, the “Sell-Side Claims”) and releases the Company, its subsidiaries and affiliates, and their independent contractor real estate agents in the U.S. from the Sell-Side Claims. By the terms of the Settlement, the Company agreed to make certain changes to its business practices and to pay a total settlement amount of $ 34.0 million (not in thousands) in two equal installments of $ 17.0 million (not in thousands) into a qualified settlement escrow fund. The Company funded the first installment during the fiscal quarter ended June 30, 2025. On March 31, 2026, the United States District Court for the Northern District of Georgia granted final approval of the Settlement. However, during the quarter ended March 31, 2026,
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certain objectors filed a notice of appeal of the final approval to the Eleventh Circuit Court of Appeals. The effectiveness of the settlement agreement is predicated on the outcome of the appeal. Despite the appeal, the remaining $ 17.0 million (not in thousands) installment is due on or before June 27, 2026, and the Company intends to pay this amount from available cash.
The Settlement and any actions taken to carry out the Settlement are not an admission or concession of liability, or of the validity of any claim, defense, or point of fact or law on the part of any party. The Company continues to deny the material allegations of the complaints in the antitrust litigation. The Company entered into the Settlement after considering the risks and costs of continuing the litigation.
The Company continues to vigorously defend against the claims in the Canadian putative class action antitrust lawsuit Kevin McFall v. Canadian Real Estate Association, et al., Case No. T-119-24-ID 1 (Federal Court of Canada), filed on January 18, 2024. Management is currently unable to reasonably estimate the possible loss or range of possible loss for the Canadian antitrust litigation because, among other reasons, (i) the proceeding is in preliminary stages, (ii) specific damage amounts have not been sought, (iii) damages sought are, in our opinion, unsupported and/or exaggerated, (iv) there are significant factual issues to be resolved; and/or (v) there are novel legal issues or unsettled legal theories presented. While the Company does not expect such litigation to have a material adverse effect on our business, results of operations, cash flows or financial condition, due to the complexities inherent in such litigation, including the uncertainty of legal processes and potential developments in the cases, the ultimate liability may differ from current expectations.
Buy-Side Class Action Lawsuit
The Company is currently named in one putative nationwide class action on behalf of home buyers (those who were not also sellers) captioned Batton et al. v. The National Association of Realtors, et al. (U.S. District Court for the Northern District of Illinois Eastern Division), which was filed on November 2, 2023 against the Company and other U.S. brokerage defendants (the “Batton Action”). Plaintiffs in the Batton Action allege that the Company participated in a system that resulted in buyers of residential property paying inflated home prices as a result of sellers paying inflated buyer broker commissions in violation of federal and Illinois antitrust laws. The Company’s motion to dismiss the Batton Action has been denied. As described in the next paragraph, developments in a separate, but related, buy-side action, Tuccori v. At World Properties, et al., United States District Court for the Northern District of Illinois (“Tuccori”), have implications for resolution of the claims asserted against the Company in the Batton Action.
Tuccori, to which the Company was not named as a defendant, is a case that consolidated several purported class actions filed by home buyers. In October 2025, the court preliminarily approved a settlement structure (the “Tuccori Settlement”) which included an opt-in procedure under which other companies subject to home buyer claims could participate in the Tuccori Settlement, subject to preliminary and final court approval. On April 14, 2026, the Company opted into the Tuccori Settlement via an Opt-In Settlement Agreement. The Company anticipates that the Tuccori Settlement will apply to any claims based on any or all of the same factual predicates as those in the Batton Action. While the Company does not expect such litigation to have a material adverse effect on our business, results of operations, cash flows or financial condition, due to the complexities inherent in such litigation, including the uncertainty of legal processes and potential developments in the cases, the ultimate liability may differ from current expectations.
Derivative Litigation
Certain current and former directors and officers of the Company were named as defendants, and the Company was named as a nominal defendant, in a derivative lawsuit in the Court of Chancery of the State of Delaware, first filed on September 25, 2024, entitled Los Angeles City Employees’ Retirement System, on behalf of eXp World Holdings, Inc. v. Glenn Sanford, et al. (C.A. No. 2024-0998-KSJM). The lawsuit alleges that certain current and former directors and officers breached fiduciary duties related to the Company’s response to reports of alleged sexual misconduct involving independent contractor real estate agents affiliated with the Company’s subsidiaries and that certain defendants had improper compensation arrangements allowing them to profit from the Company’s revenue share program in connection therewith. The complaint seeks a court declaration of fiduciary duty breaches, disgorgement of profits, damages with interest, injunctive relief for improved oversight of sexual misconduct allegations, and reimbursement of plaintiffs’ costs, including expert and attorney fees. During the quarter ended March 31, 2026, the Court of Chancery denied the defendants' motion to dismiss. The case will now proceed to discovery. Although the Company does not anticipate that the outcome of such litigation will have a material adverse effect on its business, results of operations, cash flows, or financial condition, the inherent complexities and uncertainties of legal proceedings may result in a liability that differs from current expectations. Management is currently unable to reasonably estimate the possible loss or range of possible loss for this matter because, among other reasons, (i)
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the proceeding is progressing through preliminary stages, (ii) specific damage amounts have not been sought, (iii) there are significant factual issues to be resolved; and/or (iv) there are novel legal issues or unsettled legal theories presented.
12. SUBSEQUENT EVENTS
Quarterly Cash Dividend
On April 23, 2026 , the Company’s Board declared a dividend of $ 0.05 per share which is expected to be payable on June 5, 2026 , to stockholders of record as of the close of business on May 22, 2026 . The ex-dividend date is expected to be on or around May 21, 2026. The dividend will be paid in cash.
NextHome Acquisition
On May 6, 2026, the Company completed the acquisition of NextHome, Inc. (“NextHome”), a national franchised real estate brokerage network. The acquisition represents the Company’s initial entry into the franchised real estate brokerage model. NextHome operates a franchise system through which independent real estate brokerages and agents operate under the NextHome brand pursuant to franchise agreements. The Company will reflect NextHome’s results in its consolidated financial statements beginning in the second quarter of 2026, from the date of acquisition. The initial contribution of NextHome to the Company’s consolidated revenues and results of operations is not expected to be material, though the acquisition introduces a new regulatory framework, including federal and state franchise laws and disclosure requirements.
Text extracted from the filing as submitted to EDGAR. Formatting, tables and exhibits are simplified for reading; the original document is authoritative for anything you rely on.