Fathom Holdings 2025 Q1 Earnings Beats Expectations as Net Income Narrows 4.7%

Fathom Holdings (FTHM) reported its fiscal 2025 Q1 earnings on May 13th, 2025. Fathom Holdings exceeded analyst expectations with a robust 32% revenue growth year-over-year, surpassing projections by 12%. The company has also indicated a positive outlook with expectations to achieve adjusted EBITDA profitability in the second quarter of 2025. Fathom Holdings remains committed to expanding its agent network and enhancing transaction efficiency through its Elevate program. The company’s strategic focus on a technology-driven platform is anticipated to continue driving business growth amid industry challenges.

Revenue

Fathom Holdings demonstrated strong revenue performance across its segments in 2025 Q1. The Real Estate Brokerage segment generated $88.88 million, reflecting substantial growth. The Mortgage division contributed $2.60 million, while the Technology sector added $1.06 million. Corporate and other services accounted for $1.05 million, with intersegment revenue elimination totaling $453,000. Overall, these segments culminated in a total revenue of $93.14 million.

Earnings/Net Income

Fathom Holdings narrowed its losses to $0.24 per share in Q1 2025 from $0.31 per share in Q1 2024, marking a 22.6% improvement. The net loss was reduced to $5.65 million, a 4.7% improvement from the previous year's $5.93 million. Despite ongoing challenges, the improvement in EPS indicates positive progress.

Price Action

The stock price of Fathom Holdings has climbed 4.13% during the latest trading day, has climbed 6.44% during the most recent full trading week, and has surged 32.67% month-to-date.

Post Earnings Price Action Review

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CEO Commentary

Marco Fregenal, Chief Executive Officer, expressed pride in Fathom Holdings' performance in Q1 2025, stating, "We exceeded public expectations" with a revenue increase of 32.1% to $93.1 million. He credited the team's dedication amidst challenges like elevated mortgage rates and global economic uncertainty, emphasizing "the results we are sharing today are a direct reflection of that discipline and execution." Fregenal highlighted the successful launch of the Elevate program, aimed at enhancing agent productivity and profitability. He maintained an optimistic outlook, asserting that Fathom is well-positioned to benefit from market shifts and remains focused on achieving adjusted EBITDA profitability in the second quarter.

Guidance

Fathom Holdings anticipates achieving adjusted EBITDA profitability in Q2 2025. The CEO noted a goal to onboard approximately 100 new agents per month into the Elevate program by the end of the year. Despite ongoing economic uncertainties, Fathom is encouraged by its growth trajectory and the potential for further improvements in market activity, particularly with the Elevate initiative expected to significantly enhance gross profit margins per transaction.

Additional News

In recent non-earnings related developments, Fathom Holdings has announced the successful completion of a registered direct offering, raising approximately $2.7 million in cash proceeds. This strategic move is aimed at bolstering the company's financial position and supporting its growth initiatives. Additionally, Fathom Holdings has expanded its technology portfolio by enhancing its cloud-based software offerings, which are integral to its real estate services platform. The company is focused on leveraging its proprietary tools to improve transaction efficiency and agent productivity. Furthermore, Fathom Holdings has strengthened its executive team with the appointment of a new chief technology officer, who will spearhead the company's innovation efforts and drive technological advancements across its service offerings.