Erik Carlson, CEO, RE/MAX Holdings
Illustration by Lanette Behiry/Real Estate News

RE/MAX: Growing US agent count a top priority as revenue falls 

Losses rose as revenue, U.S. agent count dropped. After a leadership shakeup, CEO Erik Carlson said having "the right people" is "vital to our future success."

February 23, 2024
4 minutes

On her first day as RE/MAX president, Amy Lessinger told investors her "first and foremost priority" will be to stabilize and grow agent count in the U.S.

The company lost 6% of its U.S. and Canada agents in 2023, with further attrition in January.

Revenue also declined, and at the same time, expenses rose more than 18% for the quarter, culminating in a net loss of $10.9 million in Q4 and a net loss of $69 million for the full year.

RE/MAX Holdings CEO Erik Carlson said the company's losses weren't due to management issues — and weren't as bad as anticipated in a down year for the real estate market as a whole. 

Still, the company announced the departure of RE/MAX CEO and President Nick Bailey and the promotion of Lessinger to the president role, along with promotions of two other top leaders — Abby Lee and Susie Winders — to executive vice president roles.

"Since my arrival, among my highest priorities is focusing on our people and our leadership team," Carlson said during an earnings call Friday. "Having the right people in the right positions is absolutely vital to our future success. These are well-deserved and positive changes that I believe will help us navigate the road ahead and realize our full potential."

What RE/MAX had to say

Carlson discussed the company's $55 million settlement agreement in the commissions cases, which is moving toward final approval, saying it could give RE/MAX a leg up over its competitors.

"Many people have suggested the proposed settlement is a differentiator that will actually create a new competitive advantage," he told investors. " We certainly hope so and think it can be."

Carlson acknowledged that the settlement was a hit to the company's balance sheet but said it was worthwhile. "While the settlement came at a significant financial cost, we believe it was the right decision for all of our stakeholders," he said. "We view it as an investment in the brand, the network, the franchisees and most importantly, the agents."

Carlson was also upbeat about the direction of the market. "Looking ahead to 2024, we believe there are many reasons to be optimistic — encouraging interest rate trends, improving customer sentiment, and ongoing pent-up demand bode well for progressively better housing market performance moving forward."

Key numbers

Revenue: $76.6 million in Q4, a decline of 5.7% compared to the same quarter a year ago. Full-year revenue fell 7.8% to $325.7 million.

Cash and cash equivalents: RE/MAX ended the year with $82.6 million, a decrease of $26.0 million from December 31, 2022.

Net income/loss: A loss of $10.9 million for the quarter, a further drop from a loss of $2.6 million a year prior. Compared to the previous quarter, however, losses improved. The company posted its biggest quarterly loss on record in Q3 — $59.5 million — which it largely attributed to the $55 million the company agreed to pay in the commissions lawsuit settlements

For the year, RE/MAX reported a net loss of $69 million, down significantly from a net income of $4.8 million in 2022.

Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization): $23 million, down 13.4% year-over-year. For 2023, EBITDA fell 20.8% to $96.3 million.

Agent count: 144,835 at the end of 2023, up slightly from 144,014 at the end of 2022. U.S. and Canada agent count slid more than 6% for the year, but growth elsewhere helped it eke out a 0.6% gain globally. 

RE/MAX lost agents in January, reporting a total of 143,497 agents as of Jan. 31, 2024, and 79,416 agents in the U.S. and Canada.

Motto Mortgage franchises: 264 offices at the end of 2023, an increase of 6.5% for the year.

Notable moves

Erik Carlson was named CEO in November, coming to RE/MAX from the DISH Network. He replaced interim CEO Steve Joyce, who remains on the company's board of directors.

The company also announced a handful of new franchise offices which added about 120 agents to the brand in December and another 110 in January.

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