What Exp World (AGNT) Said on Its Q3 Earnings Call

Key Points

• Q3 revenue rose 6% to $1.4 billion, but operating income fell 23% to $3.1 million as elevated legal expenses weighed on results; adjusted EBITDA declined 3% to $17.1 million.
• AGNT’s outlook reflects a softening housing market and high legal costs: it forecast Q4 adjusted EBITDA from a $7 million loss to break-even and expects legal expenses to normalize heading into 2027.
• Agent transactions increased 8% and sales volume rose 10%, with the NextHome acquisition contributing to growth; excluding NextHome, transactions were up 1.7%. The company ended the quarter with $111.4 million in cash and no debt.

Exp World NASDAQ: AGNT reported third-quarter revenue growth of 6% as a rise in agent transactions and its acquisition of NextHome helped offset a challenging housing market. Operating income fell 23%, however, as legal expenses weighed on results.

The company, which operates as AGNT, reported revenue of $1.4 billion for the quarter, within its guidance range of $1.35 billion to $1.45 billion. Gross profit also rose 6% to $91 million, while operating income declined to $3.1 million. Adjusted EBITDA, a non-GAAP measure, fell 3% to $17.1 million, near the bottom of the company’s $17 million to $22 million guidance range.

Chief Financial Officer Jesse Hill said heightened legal costs were the primary reason for the decline in operating income. The company updated its full-year outlook, citing softening housing demand and elevated legal expenses.

Guidance reflects housing pressure and legal costs

For the fourth quarter, AGNT projected revenue of $1 billion to $1.2 billion, operating expenses of $93 million to $97 million and adjusted EBITDA ranging from a loss of $7 million to break-even.

For the full year, the company expects revenue of $4.85 billion to $5.05 billion, operating expenses of $362 million to $367 million and adjusted EBITDA of $40 million to $47 million. Hill said rising interest rates had weighed on housing demand as the company entered the fourth quarter.

Legal costs are running above the company’s baseline because of several active matters that management believes are reaching peak activity in 2026, Hill said. He added that the company expects those costs to normalize as it heads into 2027.

Chief Executive Officer Leo Pareja described the market as challenging, noting that existing home sales were on pace to be at or near 4 million again this year. He said the company was planning for a difficult market to persist, while focusing on agent productivity, innovation, operating efficiency and margin expansion. Pareja said he would share the company’s 2027 strategy on its next earnings call.

NextHome contributes to transaction growth

AGNT ended the quarter with 87,457 agents, up 5% from a year earlier, including agents added through the NextHome acquisition in May. Real estate transactions rose 8% to more than 131,000, and sales volume increased 10% to $59.3 billion. Both figures included NextHome; excluding the acquisition, transactions rose 1.7%, Hill said.

Pareja said 44% of agents joining during the quarter were on teams, whose members are 77% more productive than individual agents. He also said more than 90% of attrition came from less productive agents. During the question-and-answer session, he corrected an earlier figure and said 49% of nonproductive U.S. agents who left eXp in the third quarter also left the industry.

North American Realty revenue rose 5% to $1.3 billion, though its operating income fell 10% to $9.5 million. International revenue increased 27% to $51.7 million, and the segment narrowed its operating loss by 14% to $1.9 million. Its adjusted EBITDA loss improved 18% to $1.3 million.

AGNT ended the quarter with $111.4 million in cash and remained debt-free, Hill said. The company is balancing cash reserves with opportunistic share repurchases, he added.

Technology and listing-data initiatives

Pareja highlighted AGNT’s technology plans, including connectors designed to let agents use existing artificial intelligence tools to access company information. He also discussed AGNT OS, an effort to modernize transaction processing, agent payments and support. He cautioned that the initiatives were in their early stages and that the company would not overpromise on timing or financial impact.

AGNT is also one of four founding equity members of Open Real Estate, an initiative announced in October to create shared infrastructure for property listing data. Pareja said the venture is a standalone company that is not consolidated into AGNT’s financial statements. Startup spending has been modest, he said, and the company does not expect anticipated costs over the next two quarters to have a material effect on its results.

As part of its margin-expansion efforts, AGNT also expects to launch Revenos Mortgage, a joint venture powered by Newrez, in early 2027, Pareja said.

About Exp World (NASDAQ:AGNT)

eXp World Holdings, Inc, together with its subsidiaries, provides cloud-based real estate brokerage services for residential homeowners and homebuyers. The company operates through North American Realty, International Realty, Virbela, and Other Affiliated Services segments. It provides Virbela, a cloud-based technologies that provides data, lead generation, and marketing tools for real estate agents and employees. In addition, the company offers SUCCESS print magazine, SUCCESS.com portal, SUCCESS newsletters, SUCCESS podcasts, SUCCESS plus, SUCCESS speakers bureau, and SUCCESS coaching, podcasts, and digital training courses.

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