RE/MAX's Q3 2025: Contradictions Emerge on Agent Recruitment, Fee Model Changes, Motto Franchise, and Productivity Strategies

Date of Call: October 31, 2025

Financials Results

• Revenue: $73.3M total revenue; excluding marketing funds $55.1M, down 5.6% YOY (organic -5.4%, FX -0.2%)
• EPS: $0.37 adjusted diluted EPS

Guidance:

• Q4 2025: agent count +0% to +1.5% vs Q4 2024; revenue $69.5M–$73.5M (includes marketing funds $17M–$19M); adjusted EBITDA $19M–$23M.
• FY 2025: agent count +0% to +1.5% vs FY 2024; revenue $290M–$294M (includes marketing funds $72M–$74M); adjusted EBITDA $90M–$94M.
• Management tightened the top end of FY revenue and EBITDA ranges; outlook assumes no further currency moves, acquisitions or divestitures.

Business Commentary:

• Agent Count and Recruitment:
• The total RE/MAX agent count reached an all-time high of over 147,500 agents worldwide, with a best third quarter in the U.S. in 3 years.

• This growth was driven by constant operational excellence, steady global growth, and enhanced value proposition through new ideas and products.

• Marketing and Technology Initiatives:

• The Marketing as a Service platform, launched 8-10 weeks ago, showed promising engagement with a low 7-figure annual run rate expected.
• The Lead Concierge program outperformed expectations, contributing to a 7-digit revenue stream, and the RE/MAX Media Network is on track for a similar contribution by year-end.

• These initiatives are aimed at enhancing agent productivity and customer experience, leveraging AI and technology to streamline marketing processes.

• Financial Performance and Margin Improvement:

• Total revenue for Q3 2025 was $73.3 million, with adjusted EBITDA of $25.8 million and a margin improvement of 40 basis points over the previous year.

• The margin improvement was due to operational efficiencies, lower personnel expenses, and strategic use of technology investments.

• Capital Allocation and Share Repurchase:

• RE/MAX Holdings decreased its total leverage ratio to 3.41x, giving it flexibility for capital allocation, including potential share repurchases.
• The company considers repurchasing shares an attractive use of capital given its current price levels.

Sentiment Analysis:

Overall Tone: Positive

• "I've never felt more positive about what lies ahead for our company"; record worldwide agent count of over 147,500; "profitability and margin performance exceeded our expectations"; marketing initiatives described as a 7‑digit revenue contributor and showing early strong engagement.

Q&A:

• Question from Anthony Paolone (JPMorgan Chase & Co, Research Division): Just, Erik, I think you mentioned there were 2 programs. You talked about 7-figure contributions potentially. I think it was marketing and maybe it was Aspire. But I was wondering if maybe you can give a little bit more color around can we expect to see that level of incremental revenue in 2026? And maybe what would the margin perhaps look like? Or just a bit more detail on what that trajectory might be.
  Response: Marketing-as-a-Service is already a 7‑digit revenue contributor in 2025 and is expected to grow in 2026 and internationally; MaaS margins are expected in the high single- to low double-digits, while the RE/MAX Media Network should have margins higher than the core business.

• Question from Anthony Paolone (JPMorgan Chase & Co, Research Division): Okay. And then just 1 other one. Just on M&A in the sector in general. Can you give us any thoughts on where you stand there? And also whether or not that has any implications on just -- you mentioned your recruitment rate and whether you're seeing people move around as a result of M&A in the space.
  Response: Consolidation creates opportunity for RE/MAX; management is seeing increased inbound interest, a robust franchise sales/conversion pipeline and stronger recruitment momentum driven by recent initiatives.

• Question from Nick McAndrew (Zelman & Associates LLC): Erik, maybe 1 for you to start. I think just with Aspire, Ascend and Appreciate now live, could you maybe just walk through what type of agent you're trying to attract with kind of each of those models? And maybe just how franchisees are thinking about those optional models in practice? I mean, are most rolling them out selectively for recruiting and for the existing agent base they already have? Or maybe if you could just add any color there, that would be helpful.
  Response: Aspire targets newer agents and has driven higher recruitment and retention; Appreciate is aimed at retiring/lower‑productivity agents to stay at an affordable rate; Ascend offers lower fixed fees with higher variable share for growth‑oriented agents; rollout is selective and largely incremental.

• Question from Nick McAndrew (Zelman & Associates LLC): Got it. Yes, that makes a lot of sense. And I guess just a follow-up. I think just given all of the investment in digital tools and marketing capabilities this year, whether it's Lead Concierge or the new Marketing as a Service platform, do you have any sense for just whether you're seeing any tangible uptick in productivity of agents or offices that are more actively engaged with these platforms versus those that aren't?
  Response: Early indicators show increased listing engagement and clicks that exceed expectations; however, measurable productivity gains will take longer to materialize given the sales cycle.

• Question from Matthew Erdner (JonesTrading Institutional Services, LLC, Research Division): I'd like to kind of shift gears and talk about Motto a little bit. You guys touched on some of the initiatives that you're doing there. But I'd kind of like to get your guys' sense a little more in depth of kind of the changes you're making there and get an idea of the profitability. And if it's not profitable, kind of that outlook towards profitability?
  Response: Management is re-evaluating Motto under new leadership, shifting toward a more variable, performance‑oriented model to improve franchise economics; it's early and specifics will be shared later (targeted discussion in February).

• Question from Matthew Erdner (JonesTrading Institutional Services, LLC, Research Division): Got it. Yes. I appreciate that. And then kind of as a follow-up to that. How do you guys plan on leveraging that agent network that you guys do have, given that you guys are up there pretty much every year in terms of transaction size so the opportunity there is pretty large.
  Response: RE/MAX plans to leverage its agent network via platforms (MaaS, Lead Concierge, Media Network), enhanced post-close engagement and cross‑sell opportunities (including mortgage) to monetize transactions and drive additional revenue streams.

• Question from Thomas Mcjoynt-Griffith (Keefe, Bruyette, & Woods, Inc., Research Division): The first one is just around -- you guys called out the organic revenue impact as taking some impact from the modifications to the standard fee model. Are you guys able to put some magnitude around that number? And then should we think about that as sort of run rating or does it lap after a year? How should we think about that?
  Response: Aspire involves ~1,500 agents and caused a near-term investment headwind; management expects this to be short‑term as agents onboard, train and begin producing, so the impact should dissipate over time.

• Question from Thomas Mcjoynt-Griffith (Keefe, Bruyette, & Woods, Inc., Research Division): Okay. And then in the sort of capital allocation priorities, returning capital through buybacks has been on the list but for the lower end for a while now. I guess, is anything different now that would make you guys more interested in buying back shares now? Should we expect to see some buybacks by year-end? Any more commentary around that?
  Response: Total leverage is now below 3.5x, giving more flexibility; management views buybacks as an attractive use of capital and is evaluating options but provided no specific timing, saying 'more to come.'

Contradiction Point 1

Agent Recruitment and Retention Strategy

It highlights changes in the company's strategy for attracting and retaining agents, which is crucial for its business model and growth.

With Aspire, Ascend, and Appreciate live, could you explain the agent types each model targets and how franchisees are implementing these models? - Nick McAndrew(Zelman & Associates LLC)

2025Q3: Aspire is aimed at newer agents and has shown higher retention rates. It is seen as incremental to existing efforts. - Erik Carlson(CEO)

Can you outline your growth initiatives and the factors driving your guidance for the next quarter? - Sarah Friar(NextGen)

2025Q1: We have had a number of new initiatives that we think will help increase our ability to recruit and retain agents over the course of this year, driving more growth. - Adam Contos(CEO)

Contradiction Point 2

Impact of Fee Model Modifications

It involves differing perspectives on the impact of fee model modifications on the company's financial performance.

Can you quantify the impact of fee model changes on organic revenue? - Thomas McJoynt-Griffith(Keefe, Bruyette, & Woods, Inc., Research Division)

2025Q3: The fee model modifications, specifically the Aspire program, have resulted in a near-term headwind due to the onboarding of new agents. The impact is estimated at about 1,500 agents. - Karri Callahan(CFO)

How much of the reduced guidance range is due to brokerage volume declines versus agent-driven recurring fees? - Thomas McJoynt-Griffith(Keefe, Bruyette, & Woods, Inc., Research Division)

2025Q2: The reduced guidance is influenced by a delay in ramping up the RE/MAX Media network, a tempered outlook on broker fees, and the near-term impact of Aspire. - Karri Callahan(CFO)

Contradiction Point 3

Motto Franchise Model and Strategy

It pertains to the company's strategy for its Motto franchise, which is a key component of its revenue growth strategy and impacts the overall financial performance of the company.

What are Motto's recent changes and their impact on profitability? - Matthew Erdner(JonesTrading Institutional Services, LLC, Research Division)

2025Q3: We have reevaluated the mortgage opportunity, with Motto being the main focus. We are changing the model to be less fixed and more variable. - Erik Carlson(CEO)

What additional revenue opportunities exist beyond the Motto franchise, and what steps is RE/MAX taking to optimize the value proposition for agents? - Anthony Paolone(JPMorgan)

2024Q4: RE/MAX is optimistic about new revenue streams. Lead Concierge is a new initiative that improves customer experience and drives bottom-line growth. Ramping up RE/MAX Media Network is expected to generate significant revenue. - W. Carlson(CEO)

Contradiction Point 4

Agent Productivity and Technology Initiatives

It involves differing expectations and outcomes regarding agent productivity and the impact of technology initiatives, which are key drivers of the company's growth strategy.

Are you seeing an increase in agent productivity from using these digital tools and marketing capabilities? - Nick McAndrew(Zelman & Associates LLC)

2025Q3: We are seeing increased engagement on listings, which should lead to improved productivity over time. It takes time to see results in our sales cycle, but initial green shoots are promising. - Erik Carlson(CEO)

Could you clarify your growth initiatives and the factors behind your next quarter's guidance? - Sarah Friar(NextGen)

2025Q1: Adam Contos: Growth drivers include strong brokerage sales and a focus on productivity and technology. We expect an improvement in overall productivity, with tech services and tools enhancing agent efficiency. - Adam Contos(CEO)

Contradiction Point 5

Agent Recruitment and Retention Strategies

It involves the company's approach to agent recruitment and retention, which directly impacts the stability and growth of its agent network, affecting revenue and overall business performance.

Can you quantify the impact of fee model changes on organic revenue? - Thomas McJoynt-Griffith(Keefe, Bruyette, & Woods, Inc., Research Division)

2025Q3: We anticipate that the fee model modifications, specifically the Aspire program, will result in a near-term headwind to organic revenue due to the onboarding of new agents. - Karri Callahan(CFO)

Are there trends in U.S. agent demographics joining the network? - Nick McAndrew(Zelman & Associates LLC)

2024Q4: The demographic remains mixed, with new agents struggling and experienced agents staying. RE/MAX aims to stabilize U.S. agent count by improving the value proposition and supporting agent onboarding. - W. Carlson(CEO)