Shares of The Real Brokerage Inc (REAX) plunged 5.59% in Thursday's trading session, despite the company reporting better-than-expected first-quarter earnings. The sharp decline suggests investors may be focusing on other aspects of the financial results or broader market conditions.
The real estate technology company reported a Q1 2025 loss of $0.02 per share, beating the average analyst estimate of a $0.04 loss. Revenue for the quarter surged 76.3% year-over-year to $354 million, surpassing Wall Street expectations of $332.92 million. The company's adjusted EBITDA came in at $8.3 million, while gross profit reached $33.9 million.
Despite the apparent beat on both top and bottom lines, investors seemed unimpressed. The net loss of $5 million for the quarter might be a concern, especially as the company had been showing improving profitability in previous quarters. Additionally, while the revenue growth is substantial, the market may have been looking for even stronger performance given the recent rally in the stock, which had risen 10.1% in the quarter leading up to this earnings release. The sell-off could also be attributed to profit-taking or concerns about the sustainability of growth in a challenging real estate market.
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