Exp World Q2 2026 Earnings Report

Exp World EPS Results

• Actual EPS: -$0.02
• Consensus EPS: $0.08
• Beat/Miss: Missed by -$0.10
• One Year Ago EPS: N/A

Exp World Revenue Results

• Actual Revenue: $1.45 billion
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: +10.70%

Exp World Announcement Details

• Quarter: Q2 2026
• Date: 8/4/2026
• Time: Before Market Opens
• Conference Call Date: Tuesday, August 4, 2026
• Conference Call Time: 5:00PM ET

Exp World (NASDAQ:AGNT) is a cloud-based real estate services company best known for operating eXp Realty, a residential real estate brokerage. Through its virtual business model, eXp Realty provides real estate professionals with brokerage support, training, collaboration tools and technology designed to help agents serve buyers and sellers.

The company also operates eXp Commercial, which focuses on commercial real estate services. Its broader technology platform has included virtual collaboration and workplace solutions intended to support distributed organizations and real estate professionals.

eXp World Holdings was founded in 2002 by Glenn Sanford, who serves as its chairman and chief executive officer. The company has expanded its brokerage operations across the United States and internationally, serving real estate professionals and clients in multiple markets. The company’s common stock trades on Nasdaq under the symbol EXPI; AGNT does not correspond to eXp World Holdings.

Exp World Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Record second-quarter results: Revenue rose 11% year over year to $1.4 billion, while Adjusted EBITDA increased 129% to $25.7 million, above the company’s guidance range. Sales transactions grew 12% and productivity per agent increased 6%.
• Positive Sentiment: AGNT reported continued operating leverage from its technology investments, including AI tools that have reviewed more than 5 million documents and increased files handled per transaction analyst by 19%. Management said further cost savings and workflow efficiencies remain available as AI capabilities improve.
• Positive Sentiment: The international segment posted 44% year-over-year revenue growth, while its operating loss narrowed 57% and Adjusted EBITDA loss improved 66%. Management attributed momentum to expansion into new countries, the Nexus operating system and international agent-sponsorship initiatives.
• Positive Sentiment: AGNT said its multi-model strategy is gaining traction through the combination of eXp Realty and NextHome, with NextHome adding approximately 4,900 agents. Although its current financial contribution is modest, management views the franchise platform as a potential avenue to capture agents whose franchise agreements are coming due.
• Negative Sentiment: Management expects housing activity to remain softer through the end of 2026 amid persistent inflation, geopolitical uncertainty, elevated Treasury yields and the Federal Reserve’s restrictive stance. Full-year revenue guidance was maintained at $4.85 billion-$5.15 billion, while the company expects continued elevated legal costs in the second half.

Presentation

[Denise Garcia, Investor Relations Representative at AGNT]

Afternoon. Welcome to the AGNT second quarter 2026 earnings fireside chat via live stream and our metaverse on the web, Frame. My name is Denise Garcia, and I manage investor relations for AGNT, formerly eXp World Holdings. Today, we will begin our earnings fireside chat with remarks from Leo Pareja, CEO of eXp Realty, Jesse Hill, Chief Financial Officer of AGNT, and Glenn Sanford, Founder, CEO, and Chairman of AGNT. Following our prepared remarks, we will open the call to a Q&A session with our speakers. Let's begin with a review of the forward-looking statements. There'll be a number of forward-looking statements made today that should be considered in conjunction with the cautionary statements contained in the company's SEC filings. Forward-looking statements are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements.

[Denise Garcia, Investor Relations Representative at AGNT]

Please see our filings with the SEC, including our most recently filed annual report on Form 10-K and quarterly reports on Form 10-Q, for a discussion of specific risks that may affect our business, performance, and financial condition. We assume no obligation to update or revise any forward-looking statements or information. As a reminder, today's call is being recorded and a replay will also be made available on agnt.inc. For a few logistics and we'll get started.

[Denise Garcia, Investor Relations Representative at AGNT]

While in Frame, if you need help, just use the Help button at the bottom right to link with tech support. Should you wish to ask a question during our presentation, you can enter your questions by scanning the QR code presented on this screen with your mobile phone or go to slido.com and type in the event code AGNT. From there, you can submit a question or vote up an existing question by giving a thumbs-up for that question to be asked. This screen will remain up on the right-hand side of the stage. I'll turn the fireside chat over to our speakers before opening the call to questions. Leo, you may begin.

[Leo Pareja, CEO at eXp Realty]

Thanks, Denise. Before I get into the numbers, I just want to ground everyone in what AGNT is today. AGNT is a global operating system for modern real estate entrepreneur and a multi-model platform where independent agents, franchise owners, and team leaders all find a home built for the way they want to grow. Two models, maximum optionality. That's the thesis behind everything I'll walk through today. Which brings me how the multi-model platform actually comes together. eXp Realty remains the undisputed cloud-based leader in our industry. NextHome offers a premier franchise experience. Together, these two brands expand our agent offering and let us serve a wider segment of the market than either brand could reach alone. NextHome is a complementary growth engine that unlocks multi-model reach across distinct market segments. We have seasoned operators in both brands driving execution and aligned incentives.

[Leo Pareja, CEO at eXp Realty]

We share a global referral network connecting eXp agents with NextHome franchisees worldwide, and we're consolidating back office legal technology resources, driving efficiencies across both brands. We are witnessing the financialization of the real estate industry. Across private equity and public company acquisitions, there's about 400,000 agents who find themselves at a franchise over the next couple of years they may no longer feel aligned with, and now we have an opportunity to convert entire franchises as those agreements come due. Let's look at the platform built by agents for agents actually produced this quarter. This was a record revenue quarter, and it was built on agent success. We ended the quarter with 87,338 agents, up 6% year-over-year. Transactions grew even faster. Over 132,000 real estate sale transactions, up 12% year-over-year. Revenue came in at $1.4 billion, up 11% year-over-year.

[Leo Pareja, CEO at eXp Realty]

Productivity, transactions per agent was up 6%. Put simply, record revenue driven by increased agent productivity. That's not just agent counting doing the work. That's our agents doing more and doing it better, which is exactly why retention of the best agents matters so much, and that's our next slide. We continue to see our least productive cohorts churn out of the industry entirely, not just out of eXp. 67% of non-productive agents in the U.S. who left eXp actually left the industry altogether in Q2. Meanwhile, we're growing productivity with teams. 41% of new Q2 agents joined on teams, and agents on teams are 78% more productive than individual agents. Our co-sponsor program just hit a one-year anniversary. Here's what we found. Agents with a co-sponsor show 40% higher production and have 10% higher retention rate. This was a deliberate strategy.

[Leo Pareja, CEO at eXp Realty]

Attract productive agents, put them in a structure that makes them more productive, and retain them. It's working. I want to shift gears and talk about how we're building the platform underneath all of this. Everything I just walked through is only possible because the platform we're building underneath it. AGNT OS brings everything an agent needs to run their business together in one place. Instead of agents juggling a dozen disconnected logins and tools, AGNT OS, which operates the Hub for eXp Realty agents, is the operating system for the agent's business. No more needing to find where to log in. All agents have to do is exprealty.com, log in as an agent, and you'll be taken to the Hub. Then they can download the Hub app to their phone. The app is available on both Apple and Android.

[Leo Pareja, CEO at eXp Realty]

Group chats, text, SkySlope, My eXp University, Marketplace, and everything you need to run your business is now live directly inside the Hub. This is the foundation for our AI native platform I want to spend the rest of my time talking about. We're transforming eXp into an AI native platform. One built to give agents the tools they need to be productive and manage their business, and to increase on their own operating efficiency at the same time. And it's working. I'll share some examples from the second quarter. DocAI, our review assistant, has been trained on thousands of documents. It has now reviewed over 5 million documents and validated 22,000 daily uploads at a score of 100%. Task center automation resulted in 19% year-over-year increase in files handled per transaction analyst. Our AI enhanced expert care now resolves the majority of incoming chats automatically.

[Leo Pareja, CEO at eXp Realty]

CARLO, our comprehensive advertising review logic operator to review agents' advertising and signage and log broker supervision automatically, is now deployed across residential brokerage operations with commercial in progress. Broker Assistant delivers immediate, scalable after-hour support for policies, procedures, and guidance across our state sites and eXp Hub. FastCAP, our AI-powered agent development tool, features a role-play accelerator that's been used over 2,800x this quarter for scalable on-demand skills development. While we're building AI native tools here domestically, our international business has been building its own operating system, Nexus, which I'll show on the next slide. Nexus brings every tool our international agents use into one connected system, from a project management tool that keeps every transaction on track, to our global property search platform, connecting buyers and sellers across borders in one seamless experience. This isn't six disconnected tools bolt together.

[Leo Pareja, CEO at eXp Realty]

It's one system, four foundations, one identity, one data layer, one AI layer, and built to scale from day one. We're seeing the momentum we've created in our international business show up in the numbers. In the second quarter, international revenue grew 44% year-over-year, while at the same time, we cut our international operating loss by 57% year-over-year and reduced our Adjusted EBITDA loss by 66% year-over-year. This is the same pattern we're seeing domestically with AI native tooling. Give agents a better platform and the efficiency follows. Which brings me to how I'd sum up the quarter. We're controlling the controllable, and it shows. Record revenue with increased operating efficiency. We're transforming into a multi-model AI native platform that give agents the tools they need to be productive and manage their business. As I walk through, it's working.

[Leo Pareja, CEO at eXp Realty]

We like our position. We're playing offense on AI and efficiency, and defense on the balance sheet. With that, I'll hand over the call to Jesse to walk through the second quarter financial results. Jesse?

[Jesse Hill, CFO at AGNT]

Thank you, Leo. Now I'll walk us through our consolidated operational and financial highlights for the second quarter 2026, beginning on the next slide. Starting with operational metrics on a consolidated basis, we ended the quarter with over 87,000 agents, with continued low attrition among our most productive agent cohorts. Productivity per person, or PPP, was up over 6% at 5.5, while volume increased 15% for the quarter. Higher PPP drove sales transactions up 12% year-over-year, resulting in over 132,000 sales transactions in the second quarter. On the next slide, I'll walk through our second quarter financials. Starting with revenue, we generated $1.4 billion in the second quarter, up 11% year-over-year at the high end of our guidance range, despite continued pressures in the macroeconomic environment. Gross profit was $98.8 million, up 7% year-over-year.

[Jesse Hill, CFO at AGNT]

Prior investments in technology and process improvements are strengthening both our top and bottom lines, excluding one-time items. Operating income was $1.6 million for the quarter, up 169% year-over-year compared to an operating loss position in the second quarter of 2025. Operating expenses were $97.2 million, $200,000 above the high end of our guidance range, primarily driven by one-time non-recurring costs. Adjusted EBITDA was $25.7 million for the quarter and above the high end of our guidance range of $21 million and up 129% year-over-year. Finally, we ended the quarter with $111.2 million in cash on the balance sheet, up 18% year-over-year. On the next slide, I'll walk through our financial results by segment.

[Jesse Hill, CFO at AGNT]

The North American Realty segment continues to be our largest revenue and profit generator, with revenue of $1.4 billion for the quarter, up 10% year-over-year, and Adjusted EBITDA of $30.7 million, up 55% year-over-year. International continues to be our fastest growing segment, with revenue of $46.4 million, up 44% year-over-year. While we continue to invest in expansion, the segment posted an operating loss of $1.8 million, which was 57% improved year-over-year, and a negative Adjusted EBITDA of $1.3 million, which was 66% improved year-over-year. Our other segment contributed $0.7 million in revenue, roughly flat year-over-year, with an Adjusted EBITDA improving 92% to a loss of $0.2 million. On a consolidated basis, that's $1.4 billion in revenue, up 11%, $1.6 million in operating income, up 169%, and $25.7 million Adjusted EBITDA, up 129% year-over-year.

[Jesse Hill, CFO at AGNT]

On the next slide, I'll review our updated outlook for 2026 and the third quarter. Looking ahead, our focus remains on innovation, efficiency, growth and agent success. We are providing our outlook for the third quarter and updating the full year 2026. Starting with the third quarter, we expect revenue in the range of $1.35 billion-$1.45 billion, expenses in the range of $85 million-$90 million, and Adjusted EBITDA in the range of $17 million-$22 million. For the year, we continue to expect revenue in the range of $4.85 billion-$5.15 billion, as productivity gains continue to be offset by a challenging macroeconomic environment. We now expect operating expenses in the range of $355 million-$365 million, and we have tightened the range of our Adjusted EBITDA guidance to $50 million-$60 million for 2026.

[Jesse Hill, CFO at AGNT]

We intend to stay financially flexible, reserving the right to invest where we see meaningful opportunities to support our agents, strengthen our technology platform and enhance long-term shareholder value. Now I will turn the call over to Glenn to wrap it up before we open up the call to questions. Glenn.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

Hey, thanks Jesse, and thanks everyone for being here. First and foremost, AGNT is the platform. It has really four businesses underneath of it. eXp Realty is still the engine. It's the most agent-centric real estate brokerage on the planet. Now we have two models. We have the eXp Realty and NextHome, which is the franchise structure for those agents or broker-owners who want to run small teams and in some cases, larger enterprises on top of it. But the agent is really still the center of the relationship and their opportunities to grow whatever size business that they want to grow. International, as you know, it's growing. It's doing very well. We added a number of countries last year, we're excited about the continued growth. One of our stated goals is to be in 50 countries by 2030.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

We think that that's a realistic goal. We expect that our continued investments will get us into new countries fairly rapidly. If you look at countries like Peru, Ecuador, especially South America, of course we've got our first eXp Con taking place in Colombia next year. We're making big investments in that. Of course, Frame is the platform that we're in right now. It continues to literally create the communication and collaboration layer for the entire enterprise. You can think about the idea that we have almost 90,000 people, actually over 90,000 when you think about staff and other people that use the platform, that turn to Frame on a regular basis to collaborate with our overall enterprise. SUCCESS, it's a cultural and training layer. SUCCESS Coaching has now had over 100 people go through our SUCCESS certified coaching platform.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

We just relaunched that this year. With Matthew and Kristen very continuous serve in larger leadership roles at SUCCESS, we're excited about how that continues to roll out for the balance of the year. Today, I'm happy to announce that Amy Cosper has joined us as editor in chief for SUCCESS Magazine as well. As we move toward 2027, we also have a bulk app and magazine subscription that we're going to be offering. We're already starting to offer to other large enterprises, but we're excited about the work that this team is doing to really create some real opportunities in the SUCCESS Magazine ecosystem. One thing that I've talked about over time is the single thread leader model, but I want to start to think about it as the AI enhanced leadership model.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

Originally we were talking about agile org design, agile scale, aligned teams, now all of our staff have access to at least one enterprise AI in their day-to-day work. This has really allowed us to build things like our Hub, build things like our DocAI, where we're using AI to not just read things in an OCR fashion, but to actually be opinionated about the things that it's advising the company on. With the models improving the way they are, we're just in the early stages of seeing where AI can take us over the next few years. Obviously, we invented the cloud-based model back in 2009. Our competitors generally are still tethered to legacy offices, commission structures, and software and hardware stack that take years to move, if they can even move off of them.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

We've had none of that to work around since we've been on the cloud since 2009. We actually invented the term cloud-based brokerage. We've been distributed and technology focused from day one, so AI's been a more natural transition given our infrastructure. We've talked a little bit about eXp Hub. We've got AI co-pilots for agent workflow. We've got a listing intelligence platform that we're continuing to build out. We now have an app store marketplace that was enabled because we built our entire replacement for Workplace by Facebook, given it went away. Now we've got the most robust communication platform that is not tied to a SaaS contract. Really, this goes back to the idea that the name change really wasn't cosmetic.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

We referred, obviously, to eXp Realty as the most agent-centric real estate brokerage. We've made AGNT platform much more overt, and that's a moat we continue to invest in. With that, I'll turn it back to Denise for Q&A.

[Denise Garcia, Investor Relations Representative at AGNT]

Thanks, Glenn. We pick it off with a question for each of our speakers before we turn the call to the analysts and ask their questions. Leo, can you give us an update on the macro and what you're expecting in the second half of 2026?

[Leo Pareja, CEO at eXp Realty]

Thanks, Denise. The back half of 2026 is looking to have continued uncertainty from several macro factors. We have sticky inflation, conflict in the Middle East, and as of last week, a very strong emphasis on the weakening of the Japanese yen. This certainly is translated into bond market pressure with a 10-year Treasury yielding climbing to its highest level since January of 2025, roughly touching 4.7%. Last week, the Fed held its federal funds between three and a half and three quarters, signaling their ongoing concerns around inflation, geopolitical uncertainty. A weak Japanese yen is adding to the bond market pressure. We saw last Friday the U.S. Treasury step in to support Japan's weakening position.

[Leo Pareja, CEO at eXp Realty]

Altogether, Fed's holding on rates, Middle Eastern driven energy and inflation pressure in the bond market, pricing shifts, all point to the back half of 2026 housing activity to track softer to year end.

[Denise Garcia, Investor Relations Representative at AGNT]

All right. Thanks, Leo. Jesse, one for you. You just had a record quarter despite a challenging backdrop. What drove the second quarter?

[Jesse Hill, CFO at AGNT]

Yeah, thanks, Denise. We mentioned our over 87,000 agent count. What's more important, we mention this nearly every quarter, is productive agents. We call that our PPP, our productivity per person, improved 6% year-over-year to 5.5 in Q2. Across our sizable agent base, even incremental improvements in agent productivity can result in outsized gains across the overall brokerage. We saw that translate into 15% increase in sales volume in Q2. Sales volume, of course, drives our revenue in the form of Gross Commission Income. Just one other thing to add to this, along the same talk track, actually. We saw a gain in market share. Our U.S. brokerage in Q2 gained 3% in market share relative to the total U.S. real estate market.

[Jesse Hill, CFO at AGNT]

We're proud of our record revenue quarter, we're also happy to see gaining market share in the quarter as well.

[Denise Garcia, Investor Relations Representative at AGNT]

One for you, Glenn. Can you speak to some of the initiatives in international that drove growth there?

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

Well, not the least of it is that last year we opened up eight new countries, a lot of those countries are actually growing quite quickly. Congratulations to everybody on the international team for the hard work that they're doing. We just finished eXp Con International in Paris just a few weeks ago. Well attended by agents from all over the world. The enthusiasm for the eXp model around the world is very tangible, and it definitely was on full display. Things like our co-sponsorship program or international sponsorship program is working really well, where agents can work with in-country agents to bring on the agents that they're looking to attract to the eXp model. Obviously, the legacy brokerage models internationally are even further behind than the domestic U.S. and Canadian-based brokerages. Still a lot of brokerages that are 50/50 splits with their agents, no caps.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

Our model is much more agent-oriented, and the commission splits definitely are appealing. Our worldwide model that's now backed by platforms like LYVVE, and its ability to basically act as a worldwide portal for eXp listings in all countries that we operate in. Last year, we started on a lab experiment in international to build out Nexus. I remember when Felix started to build that out, and it's truly become an AI operating system for all of the international countries, providing things like CRM, valuation tools, marketing tools, transaction management tools. The platform that was built was built by a very small number of people using AI as the tooling infrastructure. We're really talking about less than about four people overall, four or five people overall, building the Nexus operating system.

[Glenn Sanford, Founder, Chairman, and CEO at AGNT]

They're able to build at scale for 27-ish countries around the world, multi-language, multimodal, along with the LYVVE platform. International is running very lean. We'll continue to run lean. Of course, we're seeing a number of countries now turn profitable as we continue to invest in new countries, which we'll likely have more countries toward the end of the year announced and either launched or opening up in early 2027. It's really been a big team effort that's really driven that international growth, but it's going very well.

[Denise Garcia, Investor Relations Representative at AGNT]

Thanks, Glenn. Just as a reminder for the audience, if you'd like to ask a question, you can go to slido.com and enter the event code AGNT, A-G-N-T, and ask a question there. Or you can use the QR code on your mobile device and ask a question in Slido that way. For now, I'll go to the analysts on the stage that are joining us here. Tom White from D.A. Davidson, you can go ahead.

[Tom White, Analyst at D.A. Davidson]

Great. Thanks, Denise. Good evening, everyone. A couple, if I could. I guess just on agent count, I think you said up 6%. What was that kind of excluding NextHome? If I remember, NextHome had, I think, roughly 5,000 agents, it was kind of the legacy business, flattish, and maybe you can also just call out the impact of NextHome on revenues in the quarter.

[Jesse Hill, CFO at AGNT]

Sure. I can take that one, Tom. Thank you for the question. We shared, I believe previously, the NextHome acquisition actually resulted in approximately 4,900 agents. You're correct. It's a modest growth in the organic business in Q2, but we did see some growth there, in our own brokerage, 4,900 from NextHome, then a little over 100 organic. For the second part of your question, sorry, can you remind me?

[Tom White, Analyst at D.A. Davidson]

Oh, just maybe help quantify what the contribution of NextHome did to reported revenue in the quarter.

[Jesse Hill, CFO at AGNT]

Right. Got it. With NextHome, it's important to point out that it's a franchise model, we're not recording revenue in the same way. I'm explaining this for the full audience, Tom, I think you know this. We're not reporting revenue in the same way as we do our traditional U.S. brokerage, which records revenue at Gross Commission Income. NextHome is the franchise model, and we get revenue there in different ways, franchise fees notably. It'll be smaller, more modest contribution, especially in the shorter term with NextHome. That one's more of a strategic bolt-on to create the on-ramp for the multimodal sort of approach that we're taking this year and going forward into the future to create multiple options for agents. Modest contribution to our revenue in Q2 and in the updated guidance. Short answer for you.

[Tom White, Analyst at D.A. Davidson]

Okay. That's great. Leo, the AI native brokerage slide I thought was interesting. I'm curious whether any of those AI innovations that you talked about have started to displace any kind of legacy, maybe SaaS products, that you guys had historically been paying for, and curious whether does that mean that there's kind of a cost-saving opportunity from you guys going forward? Or is it just about AI helping everyone be more efficient?

[Leo Pareja, CEO at eXp Realty]

Yeah, I think it's all the above, Tom, absolutely. Meta gave us notice 18 months ago that we were no longer going to have access to Workplace. We shifted over to Salesforce Slack product, the agents really had a wanting of the previous enterprise feeling, we really were able to build it ground up very quickly because of the AI software writing ability, now it's super tailor-made for us. Not only from an experience standpoint, but also on the financial result. Yes, when people think of AI, I think the real lift is on businesses of scale that do repetitive behavior like we do. DocAI gives us the ability to actually meaningfully impact the workflow, versus these kind of very aspirational agent tech workflows that people pontificate on LinkedIn and other places. This actually has meaningful impact into our daily life.

[Leo Pareja, CEO at eXp Realty]

I actually made a post on social media two hours ago, randomly enough, where I instructed agents to pull out their credit card bill and see all of the SaaS stuff they pay for on a recurring basis. SaaS could also just be a marketing MarTech thing that they do on a monthly basis, that now could be replaced by a Claude skill. Right? I think the whole world is going through, "What am I paying for? How does this add meaningful activity?" I think there's more than one way of looking at it, not of just purely, "I'm going to replace Trello," but more like, "Hey, I'm paying for it in automation," and it could be as simple as Claude Cowork can actually go into your email at noon and pull a list of all the things you need to do.

[Leo Pareja, CEO at eXp Realty]

I'm always pragmatically skeptical of everything, it's show me and let's continue to push the envelope and keep moving forward.

[Tom White, Analyst at D.A. Davidson]

Great. Maybe just one last one from me, then I'll get back in the queue. Jesse, just on operating expenses, they ticked up, I think, $8.5 million-ish or so versus the first quarter. Is that the level that we should sort of think about for the next couple of quarters, or maybe there was something kind of one-time-ish related to NextHome coming on board there? Just any kind of forward color on OpEx?

[Jesse Hill, CFO at AGNT]

Thank you, Tom. We did hit the right end of our bookend, actually $200,000 over on that, we're watching it very diligently. You are correct, though. There are actually two one-times, in legal in particular. We note them in the Q, that total to approximately $8 million. You're asking about the forward look. I would say, use the guidance that we're providing. We tightened actually even the bookends on our OpEx guidance for the back half of the year. We want to make sure that we're sharing that as transparently as possible and sharing what our modeling is showing with you all. We do see heightened legal costs continuing in the back half also, and that's reflected in the guidance.

[Tom White, Analyst at D.A. Davidson]

Thank you very much. Appreciate it.

[Denise Garcia, Investor Relations Representative at AGNT]

Now I'll go to Matt Filek from William Blair. Matt, if you'd like to ask a question, you can.

[Matt Filek, Analyst at William Blair]

Thank you, Denise, and good evening, everyone. You have Matt Filek on for Steven Sheldon. Appreciate the time. Somewhat related to Tom's first question, can you provide some more detail on how Next Home factors into the revised guidance? You delivered a pretty sizable Adjusted EBITDA beat during the quarter, you narrowed the full-year Adjusted EBITDA range. Just trying to understand how that all pieces together.

[Jesse Hill, CFO at AGNT]

I can take that one. Actually glad for the double-take. I regretted not explaining it a little bit further in detail. We have revised the guidance. It now includes Next Home. I'll say there's hundreds of puts and takes into our internal modeling, right? We did a lot of updates, we held the bookends on top line revenue, which is probably a part of what you're getting at. Next Home now is included. When we say modest, we mean sub 10%, and you can think about that across categories, revenue, expense, key metrics. Next Home is currently less than 10% of our business. I look forward to the day where it grows beyond that and we actually have to break it out and report it separately. I'll keep it to that high level for now. It's sub 10% to the contribution.

[Jesse Hill, CFO at AGNT]

It is reflected in the forward guidance, but it's not material to the overall business.

[Matt Filek, Analyst at William Blair]

Jesse, just as a quick follow-up to that, anything you can share about NextHome in terms of profitability?

[Jesse Hill, CFO at AGNT]

We're not breaking that out at this point in time. Leo, maybe do you want to take it from the strategic play that we're going with NextHome and the multimodal approach?

[Leo Pareja, CEO at eXp Realty]

Matt, I'm not sure that you're asking this, but this is the question Jesse lobbed over to me. When we look at the financialization we're witnessing, you've had private equity and public companies come together and now be multi-brand. We see a huge opportunity with upwards of 400,000 agents in franchises that may be now curious as their franchise agreements come due. That NextHome acquisition was really important as a platform so we can now compete in the space that we think is going to be ripe for opportunity. As Jesse commented earlier, the gross margin in that business is a completely different profile.

[Leo Pareja, CEO at eXp Realty]

As right now, it's not adding meaningfully to the contribution, but we see that as a huge green shoot opportunity for both margin expansion, revenue expansion, and all of the opportunities that you can always click down on, Matt.

[Matt Filek, Analyst at William Blair]

That's helpful, Leo. Thank you for that additional color. I'll switch gears for my last one. In the past, you've talked about using AI to reduce the cost of processing transactions. Was just trying to get a read on what inning you would say you're in with those efforts, trying to understand how much opportunity may remain there.

[Leo Pareja, CEO at eXp Realty]

Yeah, I think the whole world is trying to solve that. I definitely think directionally, there's still way more opportunity. As every day the models get stronger and better, there's also ways of improving the process. I would say we're nowhere near to completely maximizing that opportunity.

[Matt Filek, Analyst at William Blair]

Okay. Very helpful. Thank you, Leo and team. I'll jump back in the queue.

[Denise Garcia, Investor Relations Representative at AGNT]

All right. We have no further questions from the audience. This concludes our second quarter earnings call. Thank you for joining. As always, stay up to date via our website, agnt.inc, for the latest updates on news, results, and events. You can find a recording of this call and our latest investor presentation there, too. Thank you all for your time.

[Jesse Hill, CFO at AGNT]

Thanks, everyone.

[Leo Pareja, CEO at eXp Realty]

Thank you, everyone.

Participants

Executives

• Glenn Sanford, Founder, Chairman, and CEO

Analysts

• Denise Garcia, Investor Relations Representative at AGNT
• Leo Pareja, CEO at eXp Realty
• Jesse Hill, CFO at AGNT
• Tom White, Analyst at D.A. Davidson
• Matt Filek, Analyst at William Blair