eXp has sluggish fourth quarter but posts record annual revenue
The Washington-based real estate giant missed revenue estimates in Q4 but increased agent count to more than 86,000.
Despite a slowdown in revenue in the fourth quarter, 2022 was a record year for eXp World Holdings.
The company, which includes eXp Realty, posted $933 million in revenue during the fourth quarter, down from $1.08 billion in the fourth quarter of 2021. The quarterly revenue total was the lowest since the first quarter of 2021. Analyst John Campbell of Stephens had a fourth quarter revenue estimate of just under $1.02 billion.
For the year, however, revenue was way up at $4.6 billion, an increase of 22% compared to 2021 and their highest annual revenue to date.
Agent count was also up, totaling 86,203 at the end of 2022, a 21% increase compared to the end of 2021. While a big jump, the increase was slightly lower than what analysts expected.
eXp Realty founder and CEO Glenn Sanford addressed those expectations in the company's earnings call after the numbers were released, saying the slowdown in the housing market means more agents are leaving the industry.
Sanford noted that he had an "aspirational" goal of reaching 500,000 agents at eXp, possibly within five years. However, he believes anywhere from 200,000-400,000 people will leave the industry in the next 12-24 months.
If that happens, he would expect eXp's agent count to be closer to 400,000 in five years. "As long as we focus on building a really great agent value proposition… then eventually we'll get [to 500,000]," Sanford said.
Total transactions increased 15% to 511,859 in 2022, but for the fourth quarter, transactions decreased 13% year-over-year to 109,168 despite the growth in agent count.
The company's stock was trading 17 cents higher early in after-hours trading at $12.25 per share.
Key numbers
Revenue: Consolidated Q4 revenue was $933 million, and full-year 2022 revenue from continuing operations was $4.6 billion. The Q4 revenue was down 13.6% year-over-year, while the full-year 2022 revenue was up 22% compared to 2021.
Cash and cash equivalents: Cash and investments at the end of Q4 were $121.6 million, compared to $108.2 million at the end of 2021.
Net Income: Net income of $15.4 million in 2022 with a net loss of $7.2 million in the fourth quarter of 2022.
EBITDA (earnings before interest, taxes, depreciation and amortization): Adjusted EBITDA was $60.5 million in 2022. Adjusted EBITDA was $3.6 million in the fourth quarter of 2022 compared to $13.1 million in the fourth quarter of 2021.
Earnings per diluted share: $0.10 in 2022 with a loss per diluted share of $(0.05) in the fourth quarter of 2022.
Notable moves
Glenn Sanford reclaimed the CEO role at eXp Realty in January; previously, he was CEO of the parent company, eXp World Holdings, while Jason Gesing helmed eXp Realty. In announcing the leadership change, Sanford said he was "excited to be the hands-on leader for the next period of growth for the company."
The brokerage expanded globally in 2022, adding six new international offices. In late 2022 eXp announced operations in Dubai, its 24th market. In an earnings call, eXp leaders said they expected to add around five new countries by the end of the year.