Q1 Earnings: Redfin Posts 45 Percent Revenue Decline While RE/MAX Closes Smaller Margin

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It’s earnings report time! Real estate and mortgage giants have begun publishing their wins and losses for the first quarter of 2023 and we’re tracking all the numbers for you.

RE/MAX Sees Revenue Decline 6.2 Percent

While touting that market performance was largely as expected, RE/MAX posted a total revenue decline of 6.2 percent to $85.4 million in the first quarter of 2023. Net loss attributable to RE/MAX Holdings, Inc. was $0.7 million.

Compared to Q1 of 2022, RE/MAX previously brought in $91 million at the top of last year. The decrease in revenue excluding the Marketing Funds was attributable to negative organic revenue growth of 5 percent and adverse foreign-currency movements of 1 percent. 

“Given the industry conditions, we anticipated pressure on our U.S. agent count to start the year but did see some encouraging trends toward the end of the first quarter,” said Steve Joyce, RE/MAX Holdings Chief Executive Officer. “The quarter had several other operational highlights including agent count growth in Canada and the global regions, regained momentum in Motto franchise sales, and a continued ramp in wemlo’s business. We remain squarely focused on growth, and we believe we’re positioned for improved U.S. agent count performance in the near term.”

RE/MAX’s total agent count increased 0.8 percent in Q1 to 143,523 agents.


Redfin Shrinks Net Loss While Posting Big Revenue Decline

Redfin also released Q1 figures, which show both a big revenue decline alongside smaller losses.

First quarter revenue was $325.7 million, a decrease of 45 percent compared to the first quarter of 2022. Gross profit was $56.2 million, a decrease of 23 percent year-over-year. 

Net loss was $60.8 million, compared to a net loss of $90.8 million in the first quarter of 2022.

“Redfin’s first-quarter revenues and earnings exceeded our expectations, keeping us on track for full-year adjusted EBITDA in 2023,” said Redfin CEO Glenn Kelman. “We’re drawing online visitors away from our main rivals, and our brokerage has gotten more efficient. For the second quarter, we expect gross-margins gains in our core business for the first time since 2021. The two companies we acquired over the past two years to earn additional revenue from the people using our site and our brokerage are also starting to deliver results: Rent’s revenue growth is accelerating, and Bay Equity’s net income improved, with more than one in five Redfin homebuyers getting a mortgage from Bay Equity in the first quarter. And finally, our competitive position has materially improved, as we’ve reduced our debt by more than $300 million, and sold all but five of our RedfinNow homes. We wouldn’t wish a housing downturn on anyone, but it has made Redfin leaner, hungrier and better.”

Real estate services gross profit was $15.8 million, a decrease of 33 percent year-over-year.


Opendoor Sold 35 Percent Less Homes At The Start Of 2023 Compared to 2022

Buy less, sell less appears to be the summation of Opendoor’s latest quarterly numbers. According to a company statement, the iBuyer purchased 1,747 homes, down 81 percent  versus the first quarter of 2022. It also sold far less; 8,274 total homes sold, down 35 percent compared to Q1 of last year.

All of that led to  versus 1Q22 revenue of $3.1 billion, down 39 percent year-over-year. Opendoor’s gross profit was $170 million, which reflects an inventory valuation adjustment on homes remaining in inventory at quarter end of $23 million. Net loss $101 million, versus $28 million in the first quarter of 2022.

“Our Q1 results demonstrate our progress in navigating the housing market transition against an uncertain macro backdrop. We exceeded our sell-through expectations for our longest-held homes and continued to build a new book of inventory with strong margin performance,” said Carrie Wheeler, CEO of Opendoor. “We also took further actions to right-size our cost structure. As we look ahead, we are focused on attracting more sellers, including via the expansion of our partnership channels and product diversification, and driving operational excellence to improve our long-term profitability.”

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