RE/MAX blew analysts’ expectations out of the water Thursday, reporting $71.2 million in revenue during the first three months of 2019.
Leading into the report, analysts had expected RE/MAX revenue to merely hit $65.25 million, an increase of 24 percent year-over-year.
In a statement Thursday, the company explained that revenue during the beginning of the year “increased almost exclusively due to acquisitions, which constituted primarily the Marketing Funds which the company acquired on January 1, 2019.”
The company also reported net income of $4.4 million during the first quarter of 2019.
Adam Contos
Excluding the the Marketing Funds acquisition, RE/MAX’s revenue actually fell 0.4 percent to $52.4 million, the company also revealed Thursday. However, in a statement, CEO Adam Contos said that the company remains “cautiously optimistic about the housing markets in the U.S. and Canada.”
“We remain confident in the continued strength and momentum of our business given the proven ability of RE/MAX agents to perform well in virtually any market cycle,” Contos added.
RE/MAX stock fell slightly prior to the release of the earnings report Thursday, though share prices were up about a dollar compared to one month earlier.
Credit: Google
In addition to reporting earnings Thursday, RE/MAX revealed that its agent count grew during the first three months of 2019 by 3.9 percent year-over-year, for a total of 125,532. In just the U.S. and Canada, however, RE/MAX has 84,031 agents, which represents a decrease of 0.9 percent compared to the same period last year.
In his statement Thursday, Contos also touted Motto Mortgage, saying that he is “pleased” that the lending franchise “in the U.S. continues to expand.” Motto Mortgage — which over the last year has pushed in to a number of new markets — now has 88 total offices.
One day prior to reporting its earnings, RE/MAX had also announced that it would pay investors a quarterly cash dividend of $0.21 per share.
Thursday’s earnings results come amid a tech-centric, multi-front push from RE/MAX.
In February, for example, the company began previewing its forthcoming end-to-end real estate platform — which it hopes will eventually wean consumers off their addiction to Zillow.
Then less than a month later, RE/MAX announced that it had teamed up with Zillow rival Redfin.
Following Thursday’s release, Contos said that the company “is excited about the upcoming, late-summer launch of the next generation of RE/MAX technology.”
RE/MAX previously reported Q4 2018 earnings in February. At the time, the company revealed that during the final quarter of 2018 it pulled in $50.8 million in revenue, beating analysts’ expectations.
However, the company’s total 2018 revenue came in at merely $212.6 million, which fell short of the Zacks consensus estimate of $219.1 million for the year.
Following the release of last quarter’s results, Contos said in a statement that the company was “pleased with our fourth quarter performance as our differentiated business model continued to demonstrate its strength in a correcting market.”
Looking forward, RE/MAX expects its total agent count to increase 4 percent in 2019 as compared to 2018.
The company also anticipates revenue this year to end up somewhere between $287 million and $291 million. Revenue during the second quarter of 2019 alone should come in between $70 million and $73 million — which would be roughly comparable to what RE/MAX pulled in during the quarter that just ended.