AGNT ended the third quarter with rising revenue and widening losses, as the company continues to steel itself against macroeconomic and housing market challenges.
AGNT, the parent company of eXp Realty, NextHome, FrameVR.io and SUCCESS Enterprises, saw revenue increase 6 percent year over year to $1.3 billion. However, AGNT posted net losses of $4.3 million — which stands in contrast to the $3.5 million net income it reported last year.
The company’s operating expenses increased 7 percent year over year to $87.9 million, partly reflecting AGNT’s investment in a range of new mortgage, seller and showing tools it unveiled at eXpcon early last month.
Despite market headwinds, AGNT CEO Leo Pareja said the company grew its agent count — which includes, at last count, roughly 4,900 agents under NextHome — 5 percent year over year to 87,457. Although AGNT’s agent count growth slowed compared to the previous quarter (6 percent), its agent base has been more productive, recording 131,546 transactions worth $59.3 billion — up 8 percent and 10 percent year over year, respectively.
Leo Pareja
“AGNT’s third-quarter results reflect a business with more agents, and more productive agents, than a year ago, and a financial position that we believe leaves us well-positioned to lead the industry through challenging times,” Pareja said in a written statement. “Our results are driven by the simple belief that when we put agents first, the business gets stronger. I’m excited about what’s ahead, with a platform that gives agents more ways to grow, a team that executes with discipline, and a culture that has never been afraid to move first.”
“We’re embracing the [artificial intelligence] shift that’s reshaping this business, and we’re doing it in a way that works for agents,” he added. “Whatever the market does next, we intend for AGNT to remain the company the rest of the industry is following.”
eXp’s unique AI strategy
In the company’s earnings call, Pareja provided additional insight into eXp’s AI strategy. Instead of spending money to build a proprietary AI assistant, the CEO said the brokerage has focused on adding an integration layer, also called a Model Context Protocol (MCP) connector, that lets each agent use their AI assistant of choice within AGNT OS.
“Why ask agents to change their habits at all? Our agents are already using AI they trust, whether that’s Claude, GPT, or another tool. So we built MCP connectors that meet our agents natively wherever they are today,” he said. “No new app to download, no new login to remember. An agent asks a question and gets the right answer where they are working natively. We’re not trying to outbuild the largest frontier models in the world. We’re going to connect to them instead.”
Pareja said early adoption rates are promising, with the AGNT OS system allowing eXp to be wherever its agents are, which he said should mitigate some of the friction that usually comes with tech innovation.
“This puts us inside of the tools agents already use every day, rather than asking them to adopt something new and diverting their attention away from closing deals and putting a drag on their productivity,” he said. “On operating efficiency, modernizing the systems underneath the business should, over time, reduce friction in transaction processing and how agents are supported.”
“These are early days, so we’ll be careful not to overpromise on timing or financial impact,” he added. “But we’re encouraged by the direction.”
What about NextHome?
NextHome’s exact impact on AGNT was still to be seen during Q3, as the company didn’t share financial metrics for the franchisor.
However, AGNT CFO Jesse Hill said the company was “pleased” with the franchisor’s contribution, which comes from franchise fees. AGNT purchased NextHome in May, saying the acquisition gave its most ambitious agents and team leaders another option for entrepreneurial growth. Hill said NextHome remains a key part of AGNT’s long-term strategy, and that its impact on AGNT will become more pronounced in the coming quarters.
“NextHome is the heart of our strategy to build a multi-model platform, and it contributed to [AGNT’s] revenue growth,” he said. “We’re encouraged that the productivity gains and the transaction growth in our core business are showing up in our numbers, and we’re pleased with how NextHome is adding a franchise platform and reach to agents who prefer that model, as we continue to integrate it.”
Nearing the finish line
Looking ahead, AGNT anticipates revenue will dip in Q4 — landing somewhere between $1 billion and $1.2 billion.
Hill said mortgage rates are the deciding factor in AGNT’s 2027 projections. Mortgage rate fluctuations have thrown homebuyers for a loop, leaving them unable to take advantage of an inventory increase that should’ve led to a robust fall. October’s average rate topped out at 7.61 percent; however, the Federal Reserve’s decision to hold the federal funds rate at 3.75 to 4.00 percent and falling 10-year Treasury yields have allowed rates to drop back to the 7.30 percent range.
“We intend to provide guidance in Q4 for 2027 when we have a stronger finger on the pulse for what interest rates are going to look like, what trends are looking like when we have closed out the year here,” he said. “But just initially, I can tell you we are really focused on operational efficiency and what we can do with our unit economics, and we’re going to continue to focus on that as we head into 2027.”
Hill and Pareja also fielded a question about Open Real Estate, a listing syndication platform that AGNT launched alongside Keller Williams, HomeServices of America and Real REMAX Group. Pareja said that Open Real Estate won’t be included in AGNT’s financial statements, as it’s not expected to have a “material” impact on the company’s expenses.
“Our exposure is limited to our share as one of those founding members,” Pareja said. “Our startup costs and our spend to date have been very modest and not material to AGNT. Going forward, costs will be borne out of all the founding members, not just AGNT alone. As the venture builds out in key leadership and moves ahead with a platform development and expected costs to increase over the next two quarters, we don’t expect that increase to be material to AGNT’s results.”
Hill said AGNT’s “financial model” is strong, with international growth helping eXp reach its profitability goals.
“Our third quarter reflects the strength of the financial model we’ve built and the discipline of the team that runs it,” Hill said in a written statement. “We grew the top line in a housing market that remains challenging, and we’re delivering on our goal to manage the business with discipline while continuing to invest in innovation for our agents.”
“International remained our fastest-growing segment, with revenue up 27 percent and continued progress toward profitability as we scale,” he added. “We ended the quarter with over $111 million in cash and cash equivalents and no debt, which gives us a strong balance sheet and the flexibility to invest where we see the greatest opportunity for agents and shareholders alike.”
This is a developing story and will be updated with information from AGNT’s earnings call at 5 p.m. ET.
