eXp World Holdings’ Q1 Results: A Mixed Quarter Amid Strategic Shifts

eXp World Holdings (NASDAQ: EXPI) reported its first-quarter 2025 earnings, posting revenue of $954.9 million, falling short of the $994.8 million FactSet consensus estimate. While the miss raised immediate concerns, the results also highlighted progress in key areas: narrowing net losses, improving agent satisfaction, and accelerating international expansion. The quarter underscores a company navigating short-term challenges while doubling down on long-term bets—primarily its agent-centric model and technology-driven growth.

Financial Performance: A Delicate Balance

The 1% year-over-year revenue growth to $954.9 million was driven by a more than doubling of international revenue, reflecting entries into markets like Perú and Türkiye. However, North American revenue grew only modestly, as transaction volume fell 2% to 89,643 deals. Sales volume, however, rose 4% to $38.6 billion, signaling a shift toward higher-value transactions—a trend the company aims to capitalize on.

The net loss narrowed to $11.0 million (or $0.07 per share), a 29.5% improvement from the $15.6 million loss in Q1 2024. This was aided by cost discipline and a 78 Net Promoter Score (NPS) among agents, up from 73 a year earlier. Cash reserves grew to $115.7 million, supporting shareholder returns: a $0.05 dividend was declared for June, with $5 million in stock repurchases executed in the quarter.

Operational Strengths and Weaknesses

Agent satisfaction remains a bright spot. The 78 NPS suggests agents are more engaged, even as the total agent count dropped 5% to 81,904—likely due to broader industry attrition. CEO Glenn Sanford emphasized that eXp’s “agent-first” model is attracting talent globally, with international markets now contributing 3.3% of revenue, up from 1.5% in 2024.

On the flip side, the decline in U.S. transaction volume and agent numbers raises questions about domestic competitiveness. eXp faces headwinds from rising interest rates and a cooling housing market, which disproportionately impact high-volume transactions. The company’s focus on high-value deals may mitigate this, but execution is critical.

Strategic Priorities: Tech and Global Reach

eXp’s Q1 results are best viewed through the lens of its long-term strategy:
1. Technology as a Growth Engine: Investments in tools like FrameVR.io and the co-sponsor program (which allows agents to earn fees on deals led by others) aim to boost productivity and income. The open-sourced seller advisory form—a first in the industry—also positions eXp as a transparency leader, potentially attracting consumers and agents.
2. Global Expansion: The company now operates in 26 countries, with international revenue growing faster than domestic sales. Management sees this as a key lever to reduce reliance on the U.S. market, where competition is fiercer.
3. Agent Retention: Despite the 5% agent drop, the NPS improvement suggests efforts like distributing shares (1.8 million shares in 2024) and training programs are working.

Risks and Challenges

• Agent Count Decline: A shrinking domestic agent base could limit transaction growth unless offset by productivity gains or international expansion.
• Market Volatility: The U.S. housing market remains sluggish, with pending home sales down 15% year-over-year in April.
• Profitability Lag: While net losses narrowed, eXp still posted a Q1 loss. Sustaining cash flow without diluting shareholders will require margin improvements.

Outlook and Investment Considerations

eXp’s guidance for 2025 prioritizes agent satisfaction, tech innovation, and international scale over short-term revenue targets. The narrowing net loss and cash reserves ($115.7 million) suggest financial stability, but the revenue miss highlights execution risks.

Investors should weigh:
- Upside: International markets could deliver outsized growth, while agent productivity tools may reverse the transaction volume decline.
- Downside: U.S. market weakness and agent retention challenges could persist.

Conclusion: A Company Betting on Its Model

eXp World Holdings is a high-risk, high-reward play on its agent-centric, tech-enabled real estate platform. The Q1 miss underscores the difficulty of hitting revenue targets in a volatile market, but narrowing losses and agent satisfaction gains suggest the model is intact.

Crucial data points:
- Net Loss Reduction: The 29.5% improvement in net loss reflects cost discipline.
- International Momentum: Doubling international revenue year-over-year signals scalability.
- Agent NPS: At 78, it’s among the highest in the industry, a key metric for retention and growth.

If eXp can stabilize its U.S. agent base, boost productivity through tech, and scale internationally, it could outperform peers in a consolidating real estate market. Until then, investors must accept volatility—both in results and stock price.

In short, eXp’s Q1 results are a mixed bag, but its strategic bets—on agents, technology, and global reach—deserve attention. The question remains: Can execution outpace the headwinds? The answer will shape its long-term prospects.