10-Q: RE/MAX Holdings Reports Q2 2026 Results Amid Merger

RE/MAX Holdings, Inc. reported a 5.8% decrease in total revenue to $68.5 million and a net loss attributable to the company of $4.3 million for the second quarter of 2026.

Summary

• Total revenue for the second quarter of 2026 was $68.5 million, a decrease of 5.8% compared to the prior year.
• Revenue excluding Marketing Funds decreased by 5.1% to $51.7 million, driven by negative organic revenue growth.
• The company reported a net loss attributable to RE/MAX Holdings, Inc. of $4.3 million for the quarter, compared to a net income of $4.7 million in the prior year.
• Adjusted EBITDA decreased by 12.6% to $22.9 million, with a margin of 33.5%, down from 36.1% in the prior year.
• Total agent count increased by 1.5% to 149,267, while U.S. and Canada combined agent count decreased by 2.2%.
• Motto open offices decreased significantly by 32.0% to 149.
• The company is proceeding with its merger with The Real Brokerage Inc., with shareholder meetings scheduled for August 14, 2026, and an expected closing in the second half of 2026.
• The company recorded $11.5 million in merger transaction costs during the quarter.

Sentiment

Score: 3

Explanation: StockSavvy.ai views this filing as having a negative sentiment due to declining revenues, net losses, and a significant decrease in Adjusted EBITDA, despite the pending merger.

Positives

• Total agent count increased by 1.5% to 149,267 globally.
• U.S. REMAX franchise sales increased by 20.0% to 42.
• Canada REMAX franchise sales increased by 82.4% to 31.
• The company announced significant agent conversions in the Greater Toronto Area (over 1,200 agents) and Rhode Island (over 300 agents).
• The U.S. Department of Justice granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act for the merger.

Negatives

• Total revenue decreased by 5.8% to $68.5 million for the quarter.
• Net income attributable to RE/MAX Holdings, Inc. was a loss of $4.3 million, a significant decline from a $4.7 million profit in the prior year.
• Adjusted EBITDA decreased by 12.6% to $22.9 million, and the Adjusted EBITDA margin declined to 33.5%.
• U.S. and Canada combined agent count decreased by 2.2%.
• Motto open offices decreased by 32.0% to 149.
• The company incurred $11.5 million in merger transaction costs during the quarter.
• The company recorded $8.5 million in settlement and impairment charges related to the Batton Settlement.

Risks

• The pending merger with The Real Brokerage Inc. could have a material adverse effect on the business, results of operations, financial condition, and stock price, regardless of whether it is consummated.
• The company is subject to restrictions on its business activities during the pendency of the merger, which could prevent it from pursuing strategic opportunities.
• The company faces ongoing litigation risks, including antitrust litigations in the U.S. and Canada, which could result in significant costs and liabilities.
• Fluctuations in interest rates could impact the company's borrowing costs under its Senior Secured Credit Facility.
• Currency fluctuations, particularly with the Canadian dollar, can affect revenue and operating income.
• The company's business is subject to the cyclical nature of the real estate and mortgage markets.
• The company's ability to attract and retain employees, agents, and franchisees could be impacted by the uncertainty surrounding the merger.

Future Outlook

The company is focused on navigating market softness while positioning the business for longer-term growth through initiatives to enhance its value proposition for franchisees and agents, including new technology and marketing solutions. The merger with The Real Brokerage Inc. is expected to close in the second half of 2026, creating a combined publicly traded company.

Management Comments

• In response to challenging conditions, we remain focused on initiatives designed to enhance our value proposition for franchisees and agents by improving recruiting and onboarding and increasing flexibility by aligning economics more closely with transaction activity.
• Collectively, these initiatives reflect our strategic focus on navigating market softness while positioning the business for longer-term growth.
• We believe this initiative enhances our affiliates marketing capabilities and complements our broader focus on technology, distribution and consumer engagement.

Industry Context

StockSavvy.ai notes that the real estate brokerage industry continues to face macroeconomic headwinds, including challenging housing and mortgage market conditions and broader economic uncertainty, impacting agent counts and revenue. The pending merger with The Real Brokerage Inc. signals a trend towards consolidation in the industry.

Comparison to Industry Standards

• The company's revenue decline of 5.8% in Q2 2026, while concerning, reflects broader industry pressures affecting real estate services. Competitors like Anywhere Real Estate and Keller Williams are also navigating similar market dynamics.
• The decrease in Motto open offices by 32.0% suggests a contraction in the mortgage brokerage franchise sector, potentially due to higher interest rates and tighter lending conditions impacting new business formation.
• The increase in U.S. REMAX franchise sales (20.0%) and Canada REMAX franchise sales (82.4%) indicates a potential for brand resilience and successful recruitment efforts despite overall market softness, which may outperform industry averages for franchise acquisition in the current climate.

Legal Proceedings

• U.S. Antitrust Litigation: RE/MAX, LLC settled claims for $55.0 million, with final approval granted on May 9, 2024. Appeals are ongoing.
• Batton Action: RE/MAX, LLC entered into a settlement for $8.5 million, with final approval granted on August 4, 2026.
• Homie Technology, Inc. lawsuit alleging antitrust claims was dismissed by the court on July 15, 2025, and an appeal is pending.
• Canadian Competition Act Litigation: RE/MAX OA settled claims for $7.8 million Canadian dollars, with court approval on October 8, 2025.

Stakeholder Impact

• Shareholders: The pending merger offers a mix of cash and stock consideration, with potential for value fluctuation. The merger's success or failure carries significant implications for shareholder value.
• Agents and Franchisees: The company is implementing programs to align economics with transaction activity and enhance value proposition. Uncertainty around the merger may affect their decisions to remain with or join the network.
• Creditors: The merger includes refinancing of existing indebtedness, which could impact the capital structure and terms for creditors.
• Employees: Uncertainty regarding roles and integration post-merger could impact employee retention and morale.

Next Steps

• Hold special shareholder meetings on August 14, 2026, to vote on the merger.
• Complete the merger with The Real Brokerage Inc. in the second half of 2026, subject to closing conditions.
• Integrate operations with The Real Brokerage Inc. post-merger.
• Continue to invest in technology and marketing solutions to support affiliate success.

Key Dates

Recommendation

The company is undergoing a significant merger, which introduces considerable uncertainty. While the underlying business faces revenue declines and net losses, the potential for a combined entity with The Real Brokerage Inc. warrants a cautious 'hold' approach. Investors should monitor the merger's progress and the combined company's performance post-completion.

Keywords

real estate franchising, mortgage franchising, REMAX, Motto Mortgage, agent count, revenue, Adjusted EBITDA, merger