Document and Entity Information
Document and Entity Information | 9 Months Ended |
Sep. 30, 2023 shares | |
Document And Entity Information | |
Document Type | 10-Q |
Document Period End Date | Sep. 30, 2023 |
Document Quarterly Report | true |
Document Transition Report | false |
Entity Registrant Name | EXP WORLD HOLDINGS, INC. |
Entity Incorporation, State or Country Code | DE |
Entity File Number | 001-38493 |
Entity Tax Identification Number | 98-0681092 |
Entity Address, Address Line One | 2219 Rimland Drive, Suite 301 |
Entity Address, City or Town | Bellingham |
Entity Address, State or Province | WA |
Entity Address, Postal Zip Code | 98226 |
City Area Code | 360 |
Local Phone Number | 685-4206 |
Title of 12(b) Security | Common Stock, $0.00001 par value per share |
Trading Symbol | EXPI |
Security Exchange Name | NASDAQ |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 153,798,815 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | Q3 |
Entity Central Index Key | 0001495932 |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 120,141 | $ 121,594 |
Restricted cash | 54,000 | 37,789 |
Accounts receivable, net of allowance for credit losses of $1,803 and $4,014, respectively | 113,344 | 87,262 |
Prepaids and other assets | 12,325 | 8,468 |
TOTAL CURRENT ASSETS | 299,810 | 255,113 |
Property, plant, and equipment, net | 13,862 | 18,151 |
Operating lease right-of-use assets | 14 | 2,127 |
Other noncurrent assets | 7,598 | 1,703 |
Intangible assets, net | 11,458 | 8,700 |
Deferred tax assets | 65,241 | 68,676 |
Goodwill | 24,879 | 27,212 |
TOTAL ASSETS | 422,862 | 381,682 |
CURRENT LIABILITIES | ||
Accounts payable | 9,322 | 10,391 |
Customer deposits | 54,210 | 37,789 |
Accrued expenses | 108,385 | 78,944 |
Current portion of lease obligation - operating lease | 14 | 175 |
TOTAL CURRENT LIABILITIES | 171,931 | 127,299 |
Long-term payable | 5 | 4,697 |
Long-term lease obligation - operating lease, net of current portion | 694 | |
TOTAL LIABILITIES | 171,936 | 132,690 |
EQUITY | ||
Common Stock, $0.00001 par value 900,000,000 shares authorized; 177,900,083 issued and 153,588,186 outstanding at September 30, 2023; 171,656,030 issued and 152,839,239 outstanding at December 31, 2022 | 2 | 2 |
Additional paid-in capital | 757,006 | 611,872 |
Treasury stock, at cost: 24,311,897 and 18,816,791 shares held, respectively | (519,635) | (385,010) |
Accumulated earnings | 11,968 | 20,723 |
Accumulated other comprehensive income | 416 | 236 |
Total eXp World Holdings, Inc. stockholders' equity | 249,757 | 247,823 |
Equity attributable to noncontrolling interest | 1,169 | 1,169 |
TOTAL EQUITY | 250,926 | 248,992 |
TOTAL LIABILITIES AND EQUITY | $ 422,862 | $ 381,682 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowance for credit losses and bad debt | $ 1,803 | $ 4,014 |
Common stock, par value | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized | 900,000,000 | 900,000,000 |
Common stock, shares issued | 180,883,383 | 171,656,030 |
Common stock, shares outstanding | 153,798,815 | 152,839,239 |
Treasury stock, shares | 27,084,568 | 18,816,791 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | ||||
Revenues | $ 1,214,513 | $ 1,238,975 | $ 3,298,056 | $ 3,664,766 |
Operating expenses | ||||
Commissions and other agent-related costs | 1,130,888 | 1,145,853 | 3,044,858 | 3,380,930 |
General and administrative expenses | 78,568 | 89,460 | 232,876 | 256,173 |
Sales and marketing expenses | 3,194 | 3,636 | 9,035 | 11,546 |
Total operating expenses | 1,212,650 | 1,238,949 | 3,286,769 | 3,648,649 |
Operating income | 1,863 | 26 | 11,287 | 16,117 |
Other (income) expense | ||||
Other (income) expense, net | (708) | (78) | (2,887) | 394 |
Equity in losses of unconsolidated affiliates | 354 | 329 | 839 | 1,213 |
Total other (income) expense, net | (354) | 251 | (2,048) | 1,607 |
Income (loss) before income tax expense | 2,217 | (225) | 13,335 | 14,510 |
Income tax (benefit) expense | 868 | (4,627) | 1,111 | (8,115) |
Net income | 1,349 | 4,402 | 12,224 | 22,625 |
Net income attributable to noncontrolling interest | 18 | |||
Net income attributable to eXp World Holdings, Inc. | $ 1,349 | $ 4,402 | $ 12,224 | $ 22,643 |
Earnings per share - Basic | $ 0.01 | $ 0.03 | $ 0.08 | $ 0.15 |
Earnings per share - Diluted | $ 0.01 | $ 0.03 | $ 0.08 | $ 0.14 |
Weighted average shares outstanding - Basic | 153,392,005 | 151,826,315 | 153,065,727 | 150,622,845 |
Weighted average shares outstanding - Diluted | 158,183,888 | 155,915,307 | 156,834,985 | 156,434,440 |
Comprehensive income: | ||||
Net income attributable to eXp World Holdings, Inc. | $ 1,349 | $ 4,402 | $ 12,224 | $ 22,625 |
Comprehensive loss attributable to noncontrolling interests | 18 | |||
Net income attributable to eXp World Holdings, Inc. | 1,349 | 4,402 | 12,224 | 22,643 |
Other comprehensive income: | ||||
Foreign currency translation gain (loss), net of tax | (527) | (521) | 180 | (1,662) |
Comprehensive income attributable to eXp World Holdings, Inc. | $ 822 | $ 3,881 | $ 12,404 | $ 20,981 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated earnings (deficit) | Accumulated other comprehensive income (loss) | Noncontrolling Interest | Total |
Beginning of period at Dec. 31, 2021 | $ 1 | $ (210,009) | $ 401,479 | $ 30,510 | $ 188 | $ 1,364 | |
Repurchase of common stock | (139,635) | ||||||
Issuance of treasury stock | 4,800 | ||||||
Net income attributable to eXp World Holdings, Inc. | 22,643 | (18) | $ 22,625 | ||||
Dividends declared and paid | (18,537) | ||||||
Shares issued for stock options exercised | 2,220 | ||||||
Agent growth incentive stock compensation | 21,793 | ||||||
Stock option compensation | 10,872 | ||||||
Agent equity stock compensation | 1 | 131,230 | |||||
Foreign currency translation gain (loss) | (1,662) | (1,662) | |||||
Transactions with noncontrolling interests | (177) | ||||||
Ending of period at Sep. 30, 2022 | 2 | (344,844) | 567,594 | 34,616 | (1,474) | 1,169 | 257,063 |
Beginning of period at Jun. 30, 2022 | 2 | (289,829) | 509,476 | 37,007 | (953) | 1,169 | |
Repurchase of common stock | (59,815) | ||||||
Issuance of treasury stock | 4,800 | ||||||
Net income attributable to eXp World Holdings, Inc. | 4,402 | 4,402 | |||||
Dividends declared and paid | (6,793) | ||||||
Shares issued for stock options exercised | 1,443 | ||||||
Agent growth incentive stock compensation | 8,523 | ||||||
Stock option compensation | 3,757 | ||||||
Agent equity stock compensation | 44,395 | ||||||
Foreign currency translation gain (loss) | (521) | (521) | |||||
Ending of period at Sep. 30, 2022 | 2 | (344,844) | 567,594 | 34,616 | (1,474) | 1,169 | 257,063 |
Beginning of period at Dec. 31, 2022 | 2 | (385,010) | 611,872 | 20,723 | 236 | 1,169 | 248,992 |
Repurchase of common stock | (134,625) | ||||||
Net income attributable to eXp World Holdings, Inc. | 12,224 | 12,224 | |||||
Dividends declared and paid | (20,979) | ||||||
Shares issued for stock options exercised | 4,761 | ||||||
Agent growth incentive stock compensation | 28,142 | ||||||
Stock option compensation | 7,683 | ||||||
Agent equity stock compensation | 104,548 | ||||||
Foreign currency translation gain (loss) | 180 | 180 | |||||
Ending of period at Sep. 30, 2023 | 2 | (519,635) | 757,006 | 11,968 | 416 | 1,169 | 250,926 |
Beginning of period at Jun. 30, 2023 | 2 | (463,738) | 701,806 | 18,138 | 943 | 1,169 | |
Repurchase of common stock | (55,897) | ||||||
Net income attributable to eXp World Holdings, Inc. | 1,349 | 1,349 | |||||
Dividends declared and paid | (7,519) | ||||||
Shares issued for stock options exercised | 3,507 | ||||||
Agent growth incentive stock compensation | 10,238 | ||||||
Stock option compensation | 2,558 | ||||||
Agent equity stock compensation | 38,897 | ||||||
Foreign currency translation gain (loss) | (527) | (527) | |||||
Ending of period at Sep. 30, 2023 | $ 2 | $ (519,635) | $ 757,006 | $ 11,968 | $ 416 | $ 1,169 | $ 250,926 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) shares in Thousands, $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
OPERATING ACTIVITIES | ||
Net income | $ 12,224 | $ 22,625 |
Reconciliation of net income to net cash provided by operating activities: | ||
Depreciation expense | 6,299 | 5,699 |
Amortization expense - intangible assets | 1,849 | 1,455 |
Loss on disposition of business | 472 | 361 |
Allowance for credit losses on receivables/bad debt on receivables | (2,211) | 588 |
Equity in loss of unconsolidated affiliates | 839 | 1,213 |
Agent growth incentive stock compensation expense | 29,912 | 22,828 |
Stock option compensation | 7,659 | 10,872 |
Agent equity stock compensation expense | 104,548 | 131,230 |
Deferred income taxes, net | 3,435 | (10,845) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (23,401) | 13,603 |
Prepaids and other assets | (3,966) | (3,003) |
Customer deposits | 16,421 | (16,135) |
Accounts payable | (1,069) | 1,952 |
Accrued expenses | 28,039 | 4,770 |
Long term payable | (4,692) | |
Other operating activities | 158 | 111 |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 176,516 | 187,324 |
INVESTING ACTIVITIES | ||
Purchases of property, plant, equipment | (4,193) | (9,222) |
Proceeds from sale of business | 330 | |
Acquisition of businesses, net of cash acquired | (9,668) | |
Investments in unconsolidated affiliates | (5,525) | |
Capitalized software development costs in intangible assets | (1,930) | |
NET CASH USED IN INVESTING ACTIVITIES | (11,318) | (18,890) |
FINANCING ACTIVITIES | ||
Repurchase of common stock | (134,625) | (139,635) |
Proceeds from exercise of options | 4,761 | 2,221 |
Transactions with noncontrolling interests | (425) | |
Dividends declared and paid | (20,979) | (18,537) |
NET CASH USED IN FINANCING ACTIVITIES | (150,843) | (156,376) |
Effect of changes in exchange rates on cash, cash equivalents and restricted cash | 403 | (771) |
Net change in cash, cash equivalents and restricted cash | 14,758 | 11,287 |
Cash, cash equivalents and restricted cash, beginning balance | 159,383 | 175,910 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE | 174,141 | 187,197 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOWS INFORMATION: | ||
Cash paid for income taxes | 2,382 | $ 2,933 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Termination of lease obligation - operating lease | 855 | |
Issuance of treasury stock, for acquisition | 4,800 | |
Property, plant and equipment purchases in accounts payable | 27 | $ 20 |
Contingent consideration for disposition of business | 1,209 | |
Property, plant and equipment increase due to transfer of right-of-use lease asset. | $ 1,100 |
DESCRIPTION OF BUSINESS AND BAS
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 9 Months Ended |
Sep. 30, 2023 | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION eXp World Holdings, Inc. (“eXp,” or, collectively with its subsidiaries, the “Company,” “we,” “us,” or “our”) owns and operates a diversified portfolio of service-based businesses whose operations benefit substantially from utilizing our technology platform. We strategically prioritize our efforts to grow our real estate brokerage by strengthening our agent value proposition, developing immersive and cloud-based technology to enable our model and providing affiliate and media services supporting those efforts. Our real estate brokerage is now one of the largest and fastest-growing real estate brokerage companies in the United States and Canada and is rapidly expanding internationally. The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10-01 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These interim financial statements should be read in conjunction with the audited consolidated financial statements and related notes contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 28, 2023 (“2022 Annual Report”). In our opinion, the accompanying interim unaudited condensed consolidated financial statements reflect all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation. Operating results for the nine months ended September 30, 2023 are not necessarily indicative of the results that may be expected for the year ending December 31, 2023. Effective in December 2022, the Company revised the presentation of segment information to reflect changes in the way the Company manages and evaluates the business. As such, we now report operating results through four reportable segments: North American Realty, International Realty, Virbela and Other Affiliated Services, as further discussed in Note 11 – Segment Information Note 11 – Segment Information |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The accompanying interim unaudited condensed consolidated financial statements include the accounts of eXp and its consolidated subsidiaries, including those entities in which we have a variable interest of which we are the primary beneficiary. If the Company has a variable interest in an entity but it is not the primary beneficiary of the entity or exercises control over the operations and has less than 50% ownership, it will use the equity method or the cost method of accounting for investments. Entities in which the Company has less than a 20% investment and where the Company does not exercise significant influence are accounted for under the cost method. Intercompany transactions and balances are eliminated upon consolidation. Variable interest entities and noncontrolling interests A company is deemed to be the primary beneficiary of a variable interest entity (“VIE”) and must consolidate the entity if the company has both: (i) and (ii) Joint ventures A joint venture is a contractual arrangement whereby the Company and other parties undertake an economic activity through a jointly controlled entity. Joint control exists when strategic, financial, and operating policy decisions relating to the activities require the unanimous consent of the parties sharing control. Joint ventures are accounted for using the equity method and are recognized initially at cost. Use of Estimate The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to allowance for credit losses, legal contingencies, income taxes, revenue recognition, stock-based compensation, goodwill, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. Reclassifications When necessary, the Company will reclassify certain amounts in prior-period financial statements to conform to the current period’s presentation. No reclassifications occurred during the current period. Restricted cash Restricted cash consists of cash held in escrow by the Company on behalf of real estate buyers. The Company recognizes a corresponding customer deposit liability until the funds are released. Once the cash transfers from escrow, the Company reduces the respective customers’ deposit liability. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown on the condensed consolidated statements of cash flows. Cash and cash equivalents Restricted cash Total Balance, December 31, 2021 $ 108,237 $ 67,673 $ 175,910 Balance, September 30, 2022 $ 134,545 $ 52,652 $ 187,197 Balance, December 31, 2022 $ 121,594 $ 37,789 $ 159,383 Balance, September 30, 2023 $ 120,141 $ 54,000 $ 174,141 |
EXPECTED CREDIT LOSSES
EXPECTED CREDIT LOSSES | 9 Months Ended |
Sep. 30, 2023 | |
EXPECTED CREDIT LOSSES [Abstract] | |
EXPECTED CREDIT LOSSES | 3. EXPECTED CREDIT LOSSES The Company is exposed to credit losses primarily through trade and other financing receivables arising from revenue transactions. The Company uses the aging schedule method to estimate current expected credit losses (“CECL”) based on days of delinquency, including information about past events and current economic conditions. The Company’s accounts receivable is separated into three categories to evaluate allowance under the CECL impairment model. The receivables in each category share similar risk characteristics. The three categories include agent non-commission based fees, agent short-term advances, and commissions receivable for real estate property settlements. The Company increases the allowance for expected credits losses when the Company determines all or a portion of a receivable is uncollectable. The Company recognizes recoveries as a decrease to the allowance for expected credit losses. Receivables from real estate property settlements totaled $107,133 and $79,135 of which the Company recognized expected credit losses of $25 and $3,127, respectively as of September 30, 2023 and December 31, 2022. As of September 30, 2023 and December 31, 2022 agent non-commission based fees receivable and short-term advances totaled $8,014 and $12,141, of which the Company recognized expected credit losses of $1,778 and $887, respectively. |
PLANT, PROPERTY AND EQUIPMENT,
PLANT, PROPERTY AND EQUIPMENT, NET | 9 Months Ended |
Sep. 30, 2023 | |
PLANT, PROPERTY AND EQUIPMENT, NET | |
PLANT, PROPERTY AND EQUIPMENT, NET | 4. PLANT, PROPERTY AND EQUIPMENT, NET Plant, property and equipment, net consisted of the following: September 30, 2023 December 31, 2022 Computer hardware and software $ 36,528 $ 34,206 Furniture, fixture, and equipment 2,252 20 Total depreciable property and equipment 38,780 34,226 Less: accumulated depreciation (25,675) (19,282) Depreciable property, net 13,105 14,944 Assets under development 757 3,207 Property, plant, and equipment, net $ 13,862 $ 18,151 For the three months ended September 30, 2023 and 2022 depreciation expense was $2,136 and $2,129, respectively. For the nine months ended September 30, 2023 and 2022, depreciation expense was $6,299 and $5,699, respectively. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2023 | |
GOODWILL AND INTANGIBLE ASSETS | |
GOODWILL AND INTANGIBLE ASSETS | 5. GOODWILL AND INTANGIBLE ASSETS Goodwill was $24,879 as of September 30, 2023 and $27,212 as of December 31, 2022. As of September 30, 2023, the Company recorded cumulative translation adjustment of $23 related to Canadian goodwill. During the third quarter of 2023, the Company disposed of its Showcase Web Sites LLC business, which resulted in a reduction of goodwill of $2,310, this business was included in the North American Realty segment. The Company has a risk of future impairment to the extent that individual reporting unit performance does not meet projections. Additionally, if current assumptions and estimates, including projected revenues and income growth rates, terminal growth rates, competitive and consumer trends, market-based discount rates, and other market factors, are not met, or if valuation factors outside of the Company’s control change unfavorably, the estimated fair value of goodwill could be adversely affected, leading to a potential impairment in the future. For the three and nine months ended September 30, 2023, no events occurred that indicated it was more likely than not that goodwill was impaired. Definite-lived intangible assets were as follows: September 30, 2023 December 31, 2022 Gross Accumulated Net Carrying Gross Accumulated Net Carrying Amount Amortization Amount Amount Amortization Amount Trade name $ 3,242 ($ 970) $ 2,272 $ 3,459 ($ 841) $ 2,618 Existing technology 8,754 (3,639) 5,115 3,995 (2,458) 1,537 Non-competition agreements 460 (125) 335 461 (125) 336 Customer relationships 1,655 (617) 1,038 1,895 (551) 1,344 Licensing agreement 208 (208) - 210 (181) 29 Intellectual property 2,836 (138) 2,698 2,836 - 2,836 Total intangible assets $ 17,155 ($ 5,697) $ 11,458 $ 12,856 ($ 4,156) $ 8,700 Definite-lived intangible assets are amortized using the straight-line method over an asset’s estimated useful life. Amortization expense for definite-lived intangible assets for the three months ended September 30, 2023 and 2022 was $654 and $638, respectively. Amortization expense for definite-lived intangible assets for the nine months ended September 30, 2023 and 2022 was $1,849 and $1,455, respectively. The Company has no indefinite-lived assets. |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2023 | |
STOCKHOLDERS' EQUITY | |
STOCKHOLDERS' EQUITY | 6. STOCKHOLDERS’ EQUITY The following table represents a share reconciliation of the Company’s common stock issued for the periods presented: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Common stock: Balance, beginning of quarter 177,900,083 163,286,569 171,656,030 155,516,284 Shares issued for stock options exercised 610,132 681,139 802,939 2,044,193 Agent growth incentive stock compensation 387,999 1,184,446 1,774,438 2,098,770 Agent equity stock compensation 1,985,169 3,410,310 6,649,976 8,903,217 Balance, end of quarter 180,883,383 168,562,464 180,883,383 168,562,464 The Company’s equity programs described below are administered under the stockholder approved 2015 Equity Incentive Plan. The purpose of the equity plan is to retain the services of valued employees, directors, officers, agents, and consultants and to incentivize such persons to make contributions to the Company and motivate excellent performance. Agent Equity Program The Company provides agents and brokers the opportunity to elect to receive 5% of commissions earned from each completed real estate transaction in the form of common stock (the “Agent Equity Program” or “AEP”). If agents and brokers elect to receive portions of their commissions in common stock, they are entitled to receive the equivalent number of shares of common stock, based on the fixed monetary value of the commission payable. The Company recognizes a 10% discount on these issuances as an additional cost of sales charge during the periods presented. During the three months ended September 30, 2023 and 2022, the Company issued 1,985,169 and 3,410,310 shares of common stock, respectively, to agents and brokers with a value of $38,897 and $44,395, respectively, inclusive of discount. During the nine months ended September 30, 2023 and 2022, the Company issued 6,649,976 and 8,903,217 shares of common stock, respectively, to agents and brokers with a value of $104,548 and $131,230, respectively, inclusive of discount. Agent Growth Incentive Program The Company administers an equity incentive program whereby agents and brokers become eligible to receive awards of the Company’s common stock through agent attraction and performance benchmarks (the “Agent Growth Incentive Program” or “AGIP”). The incentive program encourages greater performance and awards agents with common stock based on achievement of performance milestones. Awards typically vest after performance benchmarks are reached and three years of subsequent service is provided to the Company. Share-based performance awards are based on a fixed-dollar amount of shares based on the achievement of performance metrics. As such, the awards are classified as liabilities until the number of share awards becomes fixed once the performance metric is achieved. For the three months ended September 30, 2023 and 2022 the Company’s stock compensation expense attributable to the Agent Growth Incentive Program was $11,764 and $5,800, respectively, of which the total amount of stock compensation attributable to liability classified awards was $1,458 and ($985), respectively. For the nine months ended September 30, 2023 and 2022 the Company’s stock compensation expense attributable to the Agent Growth Incentive Program was $29,912 and $22,828, respectively, of which the total amount of stock compensation attributable to liability classified awards was $2,796 and $3,466, respectively. The following table illustrates changes in the Company’s stock compensation liability for the periods presented: Amount Balance, December 31, 2022 $ 3,885 Stock grant liability increase year to date 2,796 Stock grants reclassified from liability to equity year to date (1,094) Balance, September 30, 2023 $ 5,587 Stock Option Awards Stock options are granted to directors, officers, certain employees and consultants with an exercise price equal to the fair market value of common stock on the grant date and the stock options expire 10 years from the date of grant. These options typically have time-based restrictions with equal and periodically graded vesting over a three-year period. During the three months ended September 30, 2023 and 2022 the Company granted 445,380 and 394,657 stock options, respectively, to employees with an estimated grant date fair value of $10.71 and $8.50 per share, respectively. During the nine months ended September 30, 2023 and 2022, the Company granted 1,973,943 and 1,167,042 stock options, respectively, to employees with an estimated grant date fair value of $8.87 and $11.21 per share, respectively. The fair value was calculated using a Black Scholes-Merton option pricing model. Stock Repurchase Plan In December 2018, the Company’s board of directors (the “Board”) approved a stock repurchase program authorizing the Company to purchase up to $25.0 million of its common stock, which was later amended in November 2019 increasing the authorized repurchase amount to $75.0 million. In December 2020, the Board approved another amendment to the repurchase plan, increasing the total amount authorized to be purchased from $75.0 million to $400.0 million. In May 2022, the Board approved an increase to the total amount of its buyback program from $400.0 million to $500.0 million. In June 2023, the Board approved an increase to the total amount of its buyback program from $500.0 million to $1.0 billion. Purchases under the repurchase program may be made in the open market or through a 10b5-1 plan and are expected to comply with Rule 10b-18 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The timing and number of shares repurchased depends upon market conditions. The repurchase program does not require the Company to acquire a specific number of shares. The cost of the shares that are repurchased is funded from cash and cash equivalents on hand. 10b5-1 Repurchase Plan The Company maintains an internal stock repurchase program with program changes subject to Board consent. From time to time, the Company adopts written trading plans pursuant to Rule 10b5-1 of the Exchange Act to conduct repurchases on the open market. On January 10, 2022, the Company and Stephens Inc. entered into a form of Issuer Repurchase Plan (“Issuer Repurchase Plan”) which authorized Stephens to repurchase up to $10.0 million of its common stock per month. On May 3, 2022, the Board approved and on May 6, 2022, the Company entered into a form of first amendment to the Issuer Repurchase Plan to increase monthly repurchases from $10.0 million of its common stock per month up to $20.0 million. On September 27, 2022, the Board approved, and the Company entered into, a form of second amendment to the Issuer Repurchase Plan, to decrease the monthly repurchases from $20.0 million of its common stock per month to $13.3 million, in anticipation of volume decreases in connection with the contraction in the real estate market. On December 27, 2022, the Board approved, and the Company entered into, a form of third amendment to the Issuer Repurchase Plan, to decrease the monthly repurchases from $13.3 million of its common stock per month to $10.0 million, in connection with ongoing contractions in the real estate market. On May 10, 2023, the Board approved and, on May 11, 2023, the Company entered into, a form of fourth amendment to the Issuer Repurchase Plan, to increase the monthly repurchase amounts during 2023 due to actual and projected changes in the Company’s cash and cash equivalents; specifically, to permit purchases of up to: (i) $17.0 million during May 2023, (ii) $22.0 million during June 2023, (iii) $18.67 million during any calendar month commencing July 1, 2023 through and including September 30, 2023, and (iv) $12.0 million during any calendar month commencing October 1, 2023 through and including December 31, 2023. On June 26, 2023, the Board approved, and the Company entered into, a form of fifth amendment to the Issuer Repurchase Plan to increase the maximum aggregate buyback from $500.0 million to $1.0 billion in accordance with the repurchase program limit. For accounting purposes, common stock repurchased under the stock repurchase programs is recorded based upon the settlement date of the applicable trade. Such repurchased shares are held in treasury and are presented using the cost method. These shares are considered issued but not outstanding. The following table shows the share changes in treasury stock for the periods presented: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Treasury stock: Balance, beginning of quarter 24,311,897 11,487,691 18,816,791 6,751,692 Repurchases of common stock 2,761,943 4,716,026 8,257,049 9,452,025 Forfeiture to treasury stock for acquisition 10,728 - 10,728 - Issuance of treasury stock for acquisition - (343,331) - (343,331) Balance, end of quarter 27,084,568 15,860,386 27,084,568 15,860,386 |
EARNINGS PER SHARE
EARNINGS PER SHARE | 9 Months Ended |
Sep. 30, 2023 | |
EARNINGS PER SHARE | |
EARNINGS PER SHARE | 7. EARNINGS PER SHARE Basic earnings per share is computed based on net income attributable to eXp stockholders divided by the basic weighted-average shares outstanding during the period. Dilutive earnings per share is computed consistently with the basic computation while giving effect to all dilutive potential common shares and common share equivalents that were outstanding during the period. The Company uses the treasury stock method to reflect the potential dilutive effect of unvested stock awards and unexercised options. The following table sets forth the calculation of basic and diluted earnings per share attributable to common stock during the periods presented: Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net income attributable to eXp World Holdings, Inc. $ 1,349 $ 4,402 $ 12,224 $ 22,643 Denominator: Weighted average shares - basic 153,392,005 151,826,315 153,065,727 150,622,845 Dilutive effect of common stock equivalents 4,791,883 4,088,992 3,769,258 5,811,595 Weighted average shares - diluted 158,183,888 155,915,307 156,834,985 156,434,440 Earnings per share: Earnings per share attributable to common stock- basic $ 0.01 $ 0.03 $ 0.08 $ 0.15 Earnings per share attributable to common stock- diluted $ 0.01 $ 0.03 $ 0.08 $ 0.14 For three months ended September 30, 2023 and 2022 total outstanding shares of common stock excluded 192,684 and 1,315,861 shares, respectively, from the computation of diluted earnings per share because their effect would have been anti-dilutive. For nine months ended September 30, 2023 and 2022 total outstanding shares of common stock excluded 679,425 and 845,162 shares, respectively, from the computation of diluted earnings per share because their effect would have been anti-dilutive. |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2023 | |
INCOME TAXES | |
INCOME TAXES | 8. INCOME TAXES Our quarterly tax is computed by applying the estimated annual effective tax rate to the year-to-date pre-tax income or loss plus discrete tax items arising in the period. Our provision for income tax expense (benefit) amounted to $1,111 and ($8,115) for the nine months ended September 30, 2023 and 2022, which represent effective tax rates of positive 8.31% and negative 56.22%, respectively. The increase in the provision for income tax expense is primarily attributable to income from operations, lower deductible stock-based compensation windfalls and return to provision true-ups in various jurisdictions. The effective tax rate differs from our statutory rates in both periods primarily due to the impact of the stock- based compensation and R&D tax credit. |
FAIR VALUE MEASUREMENT
FAIR VALUE MEASUREMENT | 9 Months Ended |
Sep. 30, 2023 | |
FAIR VALUE MEASUREMENT | |
FAIR VALUE MEASUREMENT | 9. The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. The fair value hierarchy prioritizes the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined into the following three categories: ● Level 1 – Inputs are quoted market prices in active markets for identical assets or liabilities (these are observable market inputs). ● Level 2 – Inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability (includes quoted market prices for similar assets or identical or similar assets in markets in which there are few transactions, prices that are not current or prices that vary substantially). ● Level 3 – Inputs are unobservable inputs that reflect the entity's own assumptions in pricing the asset or liability (used when little or no market data is available). The Company holds funds in a money market account, which are considered Level 1 assets. The Company values its money market funds at fair value on a recurring basis. As of September 30, 2023 and December 31, 2022, the fair value of the Company’s money market funds was $45,666 and $44,062, respectively. There have been no transfers between Level 1, Level 2 and Level 3 in the period presented. The Company did not have any Level 2 or Level 3 financial assets or liabilities in the period presented. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2023 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | 10. From time to time, the Company is subject to potential liability under laws and government regulations and various claims and legal actions that may be asserted against us that could have a material adverse effect on the business, reputation, results of operations or financial condition. Such litigation includes, but is not limited to, actions or claims relating to cyber-attacks, data breaches, the Real Estate Settlement Procedures Act (“RESPA”), the Telephone Consumer Protection Act of 1991 and state consumer protection laws, antitrust and anticompetition, worker classification, timely filing required SEC filings and non-compliance with contractual or other legal obligations. As of September 30, 2023, there were no matters pending or, to the Company’s knowledge, threatened that the Company believed could have a material adverse impact on the business, reputation, results of operations, or financial condition. There are no proceedings in which any of the Company’s directors, officers or affiliates, or any registered or beneficial stockholder is an adverse party or has a material interest adverse to the Company’s interest. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 9 Months Ended |
Sep. 30, 2023 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | 11. SEGMENT INFORMATION The reportable segments presented below represent the Company’s segments for which separate financial information is available and which is utilized on a regular basis by its chief operating decision maker to assess performance and to allocate resources. In identifying its reportable segments, the Company also considers the nature of services provided by its segments. Management evaluates the operating results of each of its reportable segments based upon revenue and Adjusted EBITDA. Adjusted Segment EBITDA is defined by us as operating profit plus depreciation and amortization and stock-based compensation expenses. The Company’s presentation of Adjusted Segment EBITDA may not be comparable to similar measures used by other companies. The Company’s four reportable segments are as follows: ● North American Realty: includes real estate brokerage operations in the United States and Canada, as well as lead-generation and other real estate support services provided in North America. ● International Realty: includes real estate brokerage operations in all other international locations. ● Virbela: includes Virbela enterprise metaverse technology and the support services offered by eXp World Technologies. ● Other Affiliated Services: includes our SUCCESS ® Magazine and other smaller ventures. The Company also reports corporate expenses, as further detailed below, as “Corporate and other” which include expenses incurred in connection with business development support provided to the agents as well as resources, including administrative, brokerage operations and legal functions. All segments follow the same basis of presentation and accounting policies as those described throughout the Notes to the Audited Consolidated Financial Statements included herein. The Company accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current market prices. The following table provides information about the Company’s reportable segments and a reconciliation of the total segment Revenues to consolidated Revenues and Adjusted Segment EBITDA to the consolidated operating profit and Goodwill (in thousands). Financial information for the comparable prior periods presented have been revised to conform with the current year presentation. Revenues Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 North American Realty $ 1,198,207 $ 1,226,368 $ 3,254,666 $ 3,632,276 International Realty 14,896 10,146 37,644 26,148 Virbela 1,720 2,328 5,694 6,181 Other Affiliated Services 979 1,417 3,729 3,298 Revenues reconciliation: Segment eliminations (1,289) (1,284) (3,677) (3,137) Consolidated revenues $ 1,214,513 $ 1,238,975 $ 3,298,056 $ 3,664,766 Adjusted EBITDA Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 North American Realty $ 27,171 $ 22,445 $ 82,496 $ 91,115 International Realty (2,647) (4,614) (10,105) (9,584) Virbela (1,297) (3,197) (3,789) (8,684) Other Affiliated Services (918) (563) (2,767) (2,139) Corporate expenses and other (3,359) (1,722) (8,829) (13,737) Consolidated Adjusted EBITDA $ 18,950 $ 12,349 $ 57,006 $ 56,971 Operating Profit Reconciliation: Depreciation and amortization expense 2,790 2,767 8,148 7,154 Stock compensation expense 11,764 5,800 29,912 22,828 Stock option expense 2,533 3,756 7,659 10,872 Consolidated operating profit $ 1,863 $ 26 $ 11,287 $ 16,117 Goodwill September 30, 2023 December 31, 2022 North American Realty $ 14,244 $ 16,577 International Realty - - Virbela 8,248 8,248 Other Affiliated Services 2,387 2,387 Segment total 24,879 27,212 Corporate and other - - Consolidated total $ 24,879 $ 27,212 The Company does not use segment assets to allocate resources or to assess performance of the segments and therefore, total segment assets have not been disclosed. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2023 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | 12. SUBSEQUENT EVENTS Quarterly Cash Dividend On October 25, 2023, the Company’s Board of Directors declared a dividend of $0.05 per share which is expected to be payable on November 30, 2023, to stockholders of record as of the close of business on November 16, 2023. The ex-dividend date is expected to be on or around November 15, 2023. The dividend will be paid in cash. Antitrust Litigation Gibson v. National Association of Realtors |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Principles of consolidation | Principles of Consolidation The accompanying interim unaudited condensed consolidated financial statements include the accounts of eXp and its consolidated subsidiaries, including those entities in which we have a variable interest of which we are the primary beneficiary. If the Company has a variable interest in an entity but it is not the primary beneficiary of the entity or exercises control over the operations and has less than 50% ownership, it will use the equity method or the cost method of accounting for investments. Entities in which the Company has less than a 20% investment and where the Company does not exercise significant influence are accounted for under the cost method. Intercompany transactions and balances are eliminated upon consolidation. |
Variable interest entities and noncontrolling interests | Variable interest entities and noncontrolling interests A company is deemed to be the primary beneficiary of a variable interest entity (“VIE”) and must consolidate the entity if the company has both: (i) and (ii) |
Joint ventures | Joint ventures A joint venture is a contractual arrangement whereby the Company and other parties undertake an economic activity through a jointly controlled entity. Joint control exists when strategic, financial, and operating policy decisions relating to the activities require the unanimous consent of the parties sharing control. Joint ventures are accounted for using the equity method and are recognized initially at cost. |
Use of estimates | Use of Estimate The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company regularly evaluates estimates and assumptions related to allowance for credit losses, legal contingencies, income taxes, revenue recognition, stock-based compensation, goodwill, and deferred income tax asset valuation allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected. |
Reclassifications | Reclassifications When necessary, the Company will reclassify certain amounts in prior-period financial statements to conform to the current period’s presentation. No reclassifications occurred during the current period. |
Restricted cash | Restricted cash Restricted cash consists of cash held in escrow by the Company on behalf of real estate buyers. The Company recognizes a corresponding customer deposit liability until the funds are released. Once the cash transfers from escrow, the Company reduces the respective customers’ deposit liability. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown on the condensed consolidated statements of cash flows. Cash and cash equivalents Restricted cash Total Balance, December 31, 2021 $ 108,237 $ 67,673 $ 175,910 Balance, September 30, 2022 $ 134,545 $ 52,652 $ 187,197 Balance, December 31, 2022 $ 121,594 $ 37,789 $ 159,383 Balance, September 30, 2023 $ 120,141 $ 54,000 $ 174,141 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Schedule of Cash | Cash and cash equivalents Restricted cash Total Balance, December 31, 2021 $ 108,237 $ 67,673 $ 175,910 Balance, September 30, 2022 $ 134,545 $ 52,652 $ 187,197 Balance, December 31, 2022 $ 121,594 $ 37,789 $ 159,383 Balance, September 30, 2023 $ 120,141 $ 54,000 $ 174,141 |
PLANT, PROPERTY AND EQUIPMENT_2
PLANT, PROPERTY AND EQUIPMENT, NET (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
PLANT, PROPERTY AND EQUIPMENT, NET | |
Schedule of plant, property and equipment | September 30, 2023 December 31, 2022 Computer hardware and software $ 36,528 $ 34,206 Furniture, fixture, and equipment 2,252 20 Total depreciable property and equipment 38,780 34,226 Less: accumulated depreciation (25,675) (19,282) Depreciable property, net 13,105 14,944 Assets under development 757 3,207 Property, plant, and equipment, net $ 13,862 $ 18,151 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
GOODWILL AND INTANGIBLE ASSETS | |
Schedule of Definite-Lived Assets | September 30, 2023 December 31, 2022 Gross Accumulated Net Carrying Gross Accumulated Net Carrying Amount Amortization Amount Amount Amortization Amount Trade name $ 3,242 ($ 970) $ 2,272 $ 3,459 ($ 841) $ 2,618 Existing technology 8,754 (3,639) 5,115 3,995 (2,458) 1,537 Non-competition agreements 460 (125) 335 461 (125) 336 Customer relationships 1,655 (617) 1,038 1,895 (551) 1,344 Licensing agreement 208 (208) - 210 (181) 29 Intellectual property 2,836 (138) 2,698 2,836 - 2,836 Total intangible assets $ 17,155 ($ 5,697) $ 11,458 $ 12,856 ($ 4,156) $ 8,700 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
STOCKHOLDERS' EQUITY | |
Schedule of common stock issued roll forward | Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Common stock: Balance, beginning of quarter 177,900,083 163,286,569 171,656,030 155,516,284 Shares issued for stock options exercised 610,132 681,139 802,939 2,044,193 Agent growth incentive stock compensation 387,999 1,184,446 1,774,438 2,098,770 Agent equity stock compensation 1,985,169 3,410,310 6,649,976 8,903,217 Balance, end of quarter 180,883,383 168,562,464 180,883,383 168,562,464 |
Changes in the Company's stock compensation liability | Amount Balance, December 31, 2022 $ 3,885 Stock grant liability increase year to date 2,796 Stock grants reclassified from liability to equity year to date (1,094) Balance, September 30, 2023 $ 5,587 |
Schedule of shares repurchased | Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Treasury stock: Balance, beginning of quarter 24,311,897 11,487,691 18,816,791 6,751,692 Repurchases of common stock 2,761,943 4,716,026 8,257,049 9,452,025 Forfeiture to treasury stock for acquisition 10,728 - 10,728 - Issuance of treasury stock for acquisition - (343,331) - (343,331) Balance, end of quarter 27,084,568 15,860,386 27,084,568 15,860,386 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
EARNINGS PER SHARE | |
Schedule of calculation of basic and diluted earnings per share | Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net income attributable to eXp World Holdings, Inc. $ 1,349 $ 4,402 $ 12,224 $ 22,643 Denominator: Weighted average shares - basic 153,392,005 151,826,315 153,065,727 150,622,845 Dilutive effect of common stock equivalents 4,791,883 4,088,992 3,769,258 5,811,595 Weighted average shares - diluted 158,183,888 155,915,307 156,834,985 156,434,440 Earnings per share: Earnings per share attributable to common stock- basic $ 0.01 $ 0.03 $ 0.08 $ 0.15 Earnings per share attributable to common stock- diluted $ 0.01 $ 0.03 $ 0.08 $ 0.14 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
SEGMENT INFORMATION | |
Schedule of segment's financial information | The following table provides information about the Company’s reportable segments and a reconciliation of the total segment Revenues to consolidated Revenues and Adjusted Segment EBITDA to the consolidated operating profit and Goodwill (in thousands). Financial information for the comparable prior periods presented have been revised to conform with the current year presentation Revenues Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 North American Realty $ 1,198,207 $ 1,226,368 $ 3,254,666 $ 3,632,276 International Realty 14,896 10,146 37,644 26,148 Virbela 1,720 2,328 5,694 6,181 Other Affiliated Services 979 1,417 3,729 3,298 Revenues reconciliation: Segment eliminations (1,289) (1,284) (3,677) (3,137) Consolidated revenues $ 1,214,513 $ 1,238,975 $ 3,298,056 $ 3,664,766 Adjusted EBITDA Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 North American Realty $ 27,171 $ 22,445 $ 82,496 $ 91,115 International Realty (2,647) (4,614) (10,105) (9,584) Virbela (1,297) (3,197) (3,789) (8,684) Other Affiliated Services (918) (563) (2,767) (2,139) Corporate expenses and other (3,359) (1,722) (8,829) (13,737) Consolidated Adjusted EBITDA $ 18,950 $ 12,349 $ 57,006 $ 56,971 Operating Profit Reconciliation: Depreciation and amortization expense 2,790 2,767 8,148 7,154 Stock compensation expense 11,764 5,800 29,912 22,828 Stock option expense 2,533 3,756 7,659 10,872 Consolidated operating profit $ 1,863 $ 26 $ 11,287 $ 16,117 Goodwill September 30, 2023 December 31, 2022 North American Realty $ 14,244 $ 16,577 International Realty - - Virbela 8,248 8,248 Other Affiliated Services 2,387 2,387 Segment total 24,879 27,212 Corporate and other - - Consolidated total $ 24,879 $ 27,212 |
DESCRIPTION OF BUSINESS AND B_2
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION (Details) | 9 Months Ended |
Sep. 30, 2023 segment | |
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION | |
Number of reportable segments | 4 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Schedule of Cash) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | ||||
Cash and cash equivalents | $ 120,141 | $ 121,594 | $ 134,545 | $ 108,237 |
Restricted cash | 54,000 | 37,789 | 52,652 | 67,673 |
Total cash, cash equivalents, and restricted cash | $ 174,141 | $ 159,383 | $ 187,197 | $ 175,910 |
EXPECTED CREDIT LOSSES (Narrati
EXPECTED CREDIT LOSSES (Narrative) (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Accounts receivable, allowance for credit losses and bad debt | $ 1,803,000 | $ 4,014,000 |
Agent Noncommission Based Fees | ||
Accounts Receivable, before Allowance for Credit Loss | 8,014,000 | 12,141,000 |
Accounts receivable, allowance for credit losses and bad debt | 1,778,000 | 887,000 |
Commissions Receivable for Real Estate Property Settlements | ||
Accounts Receivable, before Allowance for Credit Loss | 107,133,000 | 79,135,000 |
Accounts receivable, allowance for credit losses and bad debt | $ 25,000 | $ 3,127 |
PLANT, PROPERTY AND EQUIPMENT_3
PLANT, PROPERTY AND EQUIPMENT, NET (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
PLANT, PROPERTY AND EQUIPMENT, NET | ||||
Depreciation expense | $ 2,136 | $ 2,129 | $ 6,299 | $ 5,699 |
PLANT, PROPERTY AND EQUIPMENT_4
PLANT, PROPERTY AND EQUIPMENT, NET (Schedule of Fixed assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Total depreciable property and equipment | $ 38,780 | $ 34,226 |
Less: accumulated depreciation | (25,675) | (19,282) |
Depreciable property, net | 13,105 | 14,944 |
Assets under development | 757 | 3,207 |
Property, plant, and equipment, net | 13,862 | 18,151 |
Computer hardware and software | ||
Total depreciable property and equipment | 36,528 | 34,206 |
Furniture, fixtures and equipment | ||
Total depreciable property and equipment | $ 2,252 | $ 20 |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Goodwill | $ 24,879,000 | $ 24,879,000 | $ 27,212,000 | ||
Goodwill, impairment loss | 0 | 0 | |||
Amortization expense - intangible assets | 654,000 | $ 638,000 | 1,849,000 | $ 1,455,000 | |
Indefinite-lived intangible assets (excluding goodwill) | 0 | $ 0 | |||
Goodwill reduction | 2,310,000 | ||||
Adjustment | CANADA | |||||
Cumulative translation adjustment | $ 23,000 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS (Schedule of Definite-Lived Assets) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $ 17,155 | $ 12,856 |
Accumulated Amortization | (5,697) | (4,156) |
Net Carrying Amount | 11,458 | 8,700 |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 3,242 | 3,459 |
Accumulated Amortization | (970) | (841) |
Net Carrying Amount | 2,272 | 2,618 |
Existing technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 8,754 | 3,995 |
Accumulated Amortization | (3,639) | (2,458) |
Net Carrying Amount | 5,115 | 1,537 |
Non-competition agreements | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 460 | 461 |
Accumulated Amortization | (125) | (125) |
Net Carrying Amount | 335 | 336 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 1,655 | 1,895 |
Accumulated Amortization | (617) | (551) |
Net Carrying Amount | 1,038 | 1,344 |
Licensing agreement | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 208 | 210 |
Accumulated Amortization | (208) | (181) |
Net Carrying Amount | 0 | 29 |
Intellectual property | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 2,836 | 2,836 |
Accumulated Amortization | (138) | 0 |
Net Carrying Amount | $ 2,698 | $ 2,836 |
STOCKHOLDERS' EQUITY (Narrative
STOCKHOLDERS' EQUITY (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Agent Equity Award Program | ||||
Stock issued for services, shares | 1,985,169 | 3,410,310 | 6,649,976 | 8,903,217 |
Stock issued for services, value | $ 38,897 | $ 44,395 | $ 104,548 | $ 131,230 |
Percentage of commission potentially redeemed in common stock | 5% | |||
Percentage of discount of market price, date of issuance | 10% | |||
Agent Growth Incentive Program | ||||
Stock issued for services, shares | 387,999 | 1,184,446 | 1,774,438 | 2,098,770 |
Stock based compensation | $ 11,764 | $ 5,800 | $ 29,912 | $ 22,828 |
Amount of stock compensation attributable to liability classified awards | $ 1,458 | $ (985) | $ 2,796 | $ 3,466 |
Stock Options | ||||
Vesting period | 3 years | |||
Stock options granted, shares | 445,380 | 394,657 | 1,973,943 | 1,167,042 |
Share-based award expiration period | 10 years | |||
Grant date fair value | $ 10.71 | $ 8.50 | $ 8.87 | $ 11.21 |
STOCKHOLDERS' EQUITY (Schedule
STOCKHOLDERS' EQUITY (Schedule of common stock issued) (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Common Stock, Shares, Issued, Beginning Balance | 177,900,083 | 163,286,569 | 171,656,030 | 155,516,284 |
Shares issued for stock options exercised, shares | 610,132 | 681,139 | 802,939 | 2,044,193 |
Common Stock, Shares, Issued, Ending Balance | 180,883,383 | 168,562,464 | 180,883,383 | 168,562,464 |
Agent Equity Award Program | ||||
Agent equity stock compensation, shares | 1,985,169 | 3,410,310 | 6,649,976 | 8,903,217 |
Agent Growth Incentive Program | ||||
Agent equity stock compensation, shares | 387,999 | 1,184,446 | 1,774,438 | 2,098,770 |
STOCKHOLDERS' EQUITY (Changes i
STOCKHOLDERS' EQUITY (Changes in the Company's stock compensation liability) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
STOCKHOLDERS' EQUITY | |
Balance, at beginning of period | $ 3,885 |
Stock grant liability increase year to date | 2,796 |
Stock grants reclassified from liability to equity year to date | (1,094) |
Balance, at end of period | $ 5,587 |
STOCKHOLDERS' EQUITY (Schedul_2
STOCKHOLDERS' EQUITY (Schedule of shares repurchased) (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Treasury stock: | ||||
Balance, beginning of quarter | 24,311,897 | 11,487,691 | 18,816,791 | 6,751,692 |
Repurchase of common stock, shares | 2,761,943 | 4,716,026 | 8,257,049 | 9,452,025 |
Forfeiture to treasury stock for acquisition | 10,728 | 10,728 | ||
Issuance of treasury stock for acquisition | (343,331) | (343,331) | ||
Balance, end of quarter | 27,084,568 | 15,860,386 | 27,084,568 | 15,860,386 |
STOCKHOLDERS' EQUITY (Stock Rep
STOCKHOLDERS' EQUITY (Stock Repurchase Plan) (Narrative) (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Jun. 26, 2023 | May 31, 2023 | Dec. 27, 2022 | Sep. 27, 2022 | May 31, 2022 | May 06, 2022 | Jan. 10, 2022 | Dec. 31, 2020 | Nov. 30, 2019 | Dec. 31, 2018 |
STOCKHOLDERS' EQUITY | |||||||||||||
Stock repurchase program authorized amount | $ 1,000,000 | $ 1,000,000 | $ 500,000 | $ 500,000 | $ 400,000 | $ 75,000 | $ 25,000 | ||||||
Stock repurchase program authorized amount per month | $ 10,000 | $ 13,300 | $ 20,000 | $ 10,000 | |||||||||
Maximum | |||||||||||||
STOCKHOLDERS' EQUITY | |||||||||||||
Stock repurchase program authorized amount per month | $ 18,670 | ||||||||||||
Maximum | Forecast [Member] | |||||||||||||
STOCKHOLDERS' EQUITY | |||||||||||||
Stock repurchase program authorized amount per month | $ 12,000 | ||||||||||||
Maximum | Scenario, Plan [Member] | |||||||||||||
STOCKHOLDERS' EQUITY | |||||||||||||
Stock repurchase program authorized amount per month | $ 22,000 | $ 17,000 |
EARNINGS PER SHARE (Schedule of
EARNINGS PER SHARE (Schedule of calculation of basic and diluted earnings (loss) per share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
EARNINGS PER SHARE | ||||
Net income attributable to eXp World Holdings, Inc. | $ 1,349 | $ 4,402 | $ 12,224 | $ 22,643 |
Weighted average shares - basic | 153,392,005 | 151,826,315 | 153,065,727 | 150,622,845 |
Dilutive effect of common stock equivalents | 4,791,883 | 4,088,992 | 3,769,258 | 5,811,595 |
Weighted average shares - diluted | 158,183,888 | 155,915,307 | 156,834,985 | 156,434,440 |
Earnings per share attributable to common stock- basic | $ 0.01 | $ 0.03 | $ 0.08 | $ 0.15 |
Earnings per share attributable to common stock- diluted | $ 0.01 | $ 0.03 | $ 0.08 | $ 0.14 |
Shares excluded, anti-dilutive | 192,684 | 1,315,861 | 679,425 | 845,162 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
INCOME TAXES | ||||
Income tax (benefit) expense | $ 868 | $ (4,627) | $ 1,111 | $ (8,115) |
Effective income tax rate | 8.31% | 56.22% |
FAIR VALUE MEASUREMENTS (Narrat
FAIR VALUE MEASUREMENTS (Narrative) (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Money Market Funds | ||
Money market funds | $ 45,666 | $ 44,062 |
SEGMENT INFORMATION (Narrative)
SEGMENT INFORMATION (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2023 segment | |
SEGMENT INFORMATION | |
Number of reportable segments | 4 |
SEGMENT INFORMATION (Financial
SEGMENT INFORMATION (Financial Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Segment Reporting Information [Line Items] | |||||
Revenues | $ 1,214,513 | $ 1,238,975 | $ 3,298,056 | $ 3,664,766 | |
Consolidated Adjusted EBITDA | 18,950 | 12,349 | 57,006 | 56,971 | |
Depreciation and amortization expense | 2,790 | 2,767 | 8,148 | 7,154 | |
Stock compensation expense | 11,764 | 5,800 | 29,912 | 22,828 | |
Stock option expense | 2,533 | 3,756 | 7,659 | 10,872 | |
Operating profit | 1,863 | 26 | 11,287 | 16,117 | |
Goodwill | 24,879 | 24,879 | $ 27,212 | ||
Operating segments | |||||
Segment Reporting Information [Line Items] | |||||
Goodwill | 24,879 | 24,879 | 27,212 | ||
Operating segments | North American Realty | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 1,198,207 | 1,226,368 | 3,254,666 | 3,632,276 | |
Consolidated Adjusted EBITDA | 27,171 | 22,445 | 82,496 | 91,115 | |
Goodwill | 14,244 | 14,244 | 16,577 | ||
Operating segments | International Realty | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 14,896 | 10,146 | 37,644 | 26,148 | |
Consolidated Adjusted EBITDA | (2,647) | (4,614) | (10,105) | (9,584) | |
Operating segments | Virbela | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 1,720 | 2,328 | 5,694 | 6,181 | |
Consolidated Adjusted EBITDA | (1,297) | (3,197) | (3,789) | (8,684) | |
Goodwill | 8,248 | 8,248 | 8,248 | ||
Operating segments | Other Affiliated Services | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 979 | 1,417 | 3,729 | 3,298 | |
Consolidated Adjusted EBITDA | (918) | (563) | (2,767) | (2,139) | |
Goodwill | 2,387 | 2,387 | $ 2,387 | ||
Operating segments | Corporate expenses and other | |||||
Segment Reporting Information [Line Items] | |||||
Consolidated Adjusted EBITDA | (3,359) | (1,722) | (8,829) | (13,737) | |
Segment eliminations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | $ (1,289) | $ (1,284) | $ (3,677) | $ (3,137) |
SUBSEQUENT EVENTS (Narrative) (
SUBSEQUENT EVENTS (Narrative) (Details) - $ / shares | Oct. 31, 2023 | Oct. 25, 2023 | Oct. 26, 2023 | Sep. 30, 2023 | Dec. 31, 2022 |
Common stock outstanding | 153,798,815 | 152,839,239 | |||
Subsequent Event | |||||
Dividends Payable, Amount Per Share | $ 0.05 | ||||
Dividends Payable, Date to be Paid | Nov. 30, 2023 | ||||
Dividends Payable, Date Declared | Oct. 25, 2023 | ||||
Dividends Payable, Date of Record | Nov. 16, 2023 | ||||
Loss Contingency, Inestimable Loss | Gibson v. National Association of Realtors |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) | $ 1,349 | $ 4,402 | $ 12,224 | $ 22,643 |
Insider Trading Arrangements
Insider Trading Arrangements - Glenn Sanford [Member] | 3 Months Ended |
Sep. 30, 2023 shares | |
Trading Arrangements, by Individual | |
Material Terms of Trading Arrangement | On September 29, 2023, Glenn Sanford, the Company’s Chairman of the Board, Chief Executive Officer and Chief Executive Officer of eXp Realty, LLC, adopted a Rule 10b5–1 trading arrangement (as defined in Item 408 of Regulation S-K). The duration of the trading arrangement is through January 10, 2025. The aggregate number of shares of the Company’s common stock that may be sold pursuant to the trading arrangement is 945,000. |
Name | Glenn Sanford |
Title | Chairman of the Board, Chief Executive Officer and Chief Executive Officer of eXp Realty, LLC |
Rule 10b5-1 Arrangement Adopted | true |
Expiration Date | January 10, 2025 |
Sale of Stock Arrangement [Member] | |
Trading Arrangements, by Individual | |
Aggregate Available | 945,000 |