The Real Brokerage Inc. Delivers 76% Revenue Surge in Q1 2025: AI and Fintech Power Growth

The Real Brokerage Inc. (NASDAQ: REAX) is rewriting the rules of real estate brokerage. In its Q1 2025 earnings release, the company unveiled a 76% year-over-year revenue jump to $354 million, fueled by rapid agent growth, transaction volume surges, and strategic investments in AI and fintech. The results highlight a tech-driven playbook that’s positioning the firm as a disruptor in a traditionally slow-moving industry.

The Financial Engine: Growth Amid Margins Pressures

The Q1 results underscore the company’s ability to scale its platform while navigating margin headwinds. Key financial highlights include:

• Revenue: Up 76% to $354 million, driven by a 77% surge in transaction volume to 33,617 closings (vs. 19,032 in Q1 2024).
• Adjusted EBITDA: Improved 130% to $8.3 million, reflecting operational efficiencies.
• Net Loss: Narrowed to $5.0 million, down from $16.1 million a year earlier.

The gross margin dipped to 9.6% from 10.3% in Q1 2024, as a higher proportion of agents hit annual commission caps. Management emphasized this as a “positive sign of agent productivity,” but it highlights the need for fee structure adjustments to stabilize margins.

Agents Are the Engine

The Real Brokerage’s model hinges on agent acquisition and retention. Its platform now hosts 26,870 agents—a 61% increase from Q1 2024—with a churn rate of just 8.7%. By May 8, the count had risen to 27,700 agents, signaling strong momentum.

Agent growth is underpinned by tools like Leo CoPilot, an AI assistant handling all inbound phone calls and automating compliance tasks. CEO Tamir Poleg called Leo a “moat” that reduces administrative burdens and frees agents to focus on client relationships.

The company also converted 136 contractors in India to full-time employees, improving scalability by reducing the agent-to-employee ratio to 88:1—a 35% improvement over Q4 2024.

Fintech Integration: Real Wallet’s Early Wins

The Real Wallet platform, launched in late 2024, is a fintech game-changer for agents. As of April 2025:
- 3,200 U.S. agents use Real Wallet business checking accounts (FDIC-insured), averaging $8 million in deposits.
- 300 Canadian agents access credit lines tied to their earnings with Real.

Real Wallet generated $126,000 in revenue in Q1 2025—a $700,000+ annualized run rate—and is projected to become a critical ancillary revenue stream. CEO Poleg called it a “core component of our long-term moat,” as it ties agents more tightly to the platform.

The Bigger Picture: Market Resilience and Risks

The U.S. housing market faces affordability challenges, with existing home sales down 2% year-over-year. Yet Real Brokerage’s transaction volume grew 77%, outperforming the broader market.

Risks remain:
- Margin Pressures: Capped agents and rising fixed costs (up 7% to $39.1 million in Q1) could weigh on profitability.
- Market Volatility: A prolonged housing slowdown could test agent retention and transaction volumes.

The Bottom Line: A Tech-Driven Future

The Real Brokerage’s Q1 results are a testament to its AI and fintech bets paying off. With $354 million in revenue and $8.3 million in adjusted EBITDA, the company is scaling profitably even as it invests in growth.

The key catalysts ahead are clear:
1. Leo CoPilot Expansion: Integrating AI into client-facing interactions could supercharge agent productivity.
2. Real Wallet Scalability: The fintech platform’s revenue run rate suggests it could contribute $10 million+ annually within two years.
3. Margin Management: Adjusting fee structures and leveraging high-margin ancillary services (title, mortgage) will be critical to offsetting margin pressures.

Conclusion: A Disruptor with Momentum

The Real Brokerage is proving that tech-driven brokerage isn’t just a fad—it’s a winning strategy. With agent growth outpacing the industry, AI tools boosting productivity, and fintech creating sticky revenue streams, the company is primed for long-term dominance.

Investors should note the risks, but the data is compelling:
- Agent count up 61% year-over-year.
- Adjusted EBITDA up 130% since Q1 2024.
- Real Wallet’s $700,000+ annualized revenue hints at untapped potential.

This isn’t just a Q1 win—it’s a sign of a platform that’s built to scale. For investors willing to look past short-term margin pressures, The Real Brokerage’s tech-first approach could deliver outsized returns in the years ahead.