Summary of Significant Accounting Policies

Use of Estimates

The preparation of the accompanying condensed consolidated 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 the disclosure of contingent liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

The Company generates most of its revenue from contracts with customers. The Company’s major streams of revenue are:

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Continuing franchise fees, which are fixed contractual fees paid monthly by REMAX or Motto franchisees or REMAX Independent Region sub-franchisors based on the number of REMAX agents or Motto open offices.

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Annual dues, which are fees charged directly to REMAX agents.

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Broker fees, which are fees on real estate commissions when a REMAX agent assists a consumer with buying or selling a home.

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Marketing Funds fees, which are fixed contractual fees paid monthly by franchisees based on the number of REMAX agents or Motto open offices, which are obligated to be used for marketing campaigns to build brand awareness and to support agent and consumer-facing technology.

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Franchise sales and other revenue, which consists of fees from initial sales of REMAX and Motto franchises, renewals of REMAX franchises and REMAX master franchise fees, as well as data services subscription revenue, preferred marketing arrangements, technology products and subscription revenue, events-related revenue from education and other programs, mortgage loan processing revenue, Marketing Studio revenue (formerly known as Marketing as a Service (“MaaS”)) and advertising revenue.

Deferred Revenue and Capitalized Contract Costs

Deferred revenue is primarily driven by Franchise sales and Annual dues, as discussed above, and is included in “Deferred revenue” and “Deferred revenue, net of current portion” on the Condensed Consolidated Balance Sheets. Other deferred revenue is primarily related to events-related revenue. The activity consists of the following (in thousands):


	Balance at				Revenue		Balance at
	January 1, 2026		New billings		recognized ^(a)		June 30, 2026
Franchise sales	$	18,881	$	2,160	$	(3,963)	$	17,078
Annual dues		11,600		15,227		(14,918)		11,909
Broker fees and Other		3,769		24,737		(24,411)		4,095
	$	34,250	$	42,124	$	(43,292)	$	33,082

(a)	Revenue recognized related to the beginning balance for Franchise sales and Annual dues were $3.8 million and $8.9 million, respectively, for the six months ended June 30, 2026.

Capitalized contract costs include commissions paid on Franchise sales and other contract costs that are recognized as an asset and amortized over the contract life of the franchise agreement. The activity in the Company’s capitalized contract costs (which are included in “Other current assets” and “Other assets, net of current portion” on the Condensed Consolidated Balance Sheets) consist of the following (in thousands):


			Additions to
	Balance at		contract costs		Expense		Balance at
	January 1, 2026		for new activity ^(a)		recognized		June 30, 2026
Capitalized contract costs	$	4,318	$	2,782	$	(1,079)	$	6,021

(a)	Additions to contract costs for new activity that are transacted in Canadian dollars have been translated into U.S. dollars at the balance sheet date.

Transaction Price Allocated to the Remaining Performance Obligations

The following table includes estimated revenue by year, excluding certain other immaterial items, expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period (in thousands):


	Remainder of 2026		2027		2028		2029		2030		2031		Thereafter		Total
Franchise sales	$	2,932	$	4,963	$	3,708	$	2,479	$	1,402	$	530	$	1,064	$	17,078
Annual dues		9,252		2,657		—		—		—		—		—		11,909
Total	$	12,184	$	7,620	$	3,708	$	2,479	$	1,402	$	530	$	1,064	$	28,987

Disaggregated Revenue

In the following table, segment revenue is disaggregated by Company-Owned or Independent Regions, where applicable, by segment and by geographical area (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2026		2025		2026		2025
U.S. Company-Owned Regions	$	29,698	$	31,701	$	57,525	$	61,959
U.S. Independent Regions		1,417		1,499		2,753		2,896
Canada Company-Owned Regions		9,262		9,949		18,775		19,641
Canada Independent Regions		712		689		1,429		1,339
Global		4,205		3,793		8,670		7,842
Fee revenue ^(a)		45,294		47,631		89,152		93,677
Franchise sales and other revenue ^(b)		3,530		3,205		10,228		9,635
Total Real Estate		48,824		50,836		99,380		103,312
U.S.		12,453		13,664		24,840		27,911
Canada		4,017		4,314		8,227		8,687
Global		317		295		586		539
Total Marketing Funds		16,787		18,273		33,653		37,137
Mortgage ^(c)		2,899		3,641		5,705		6,768
Total	$	68,510	$	72,750	$	138,738	$	147,217

(a)	Fee revenue includes Continuing franchise fees, Annual dues and Broker fees.

(b)	Franchise sales and other revenue is mostly derived within the U.S.

(c)	Revenue from Mortgage is derived exclusively within the U.S.

Services Provided to the Marketing Funds by Real Estate

Real Estate charges the Marketing Funds for various services it performs or for payments it makes on behalf of the Marketing Funds to third-party vendors. These services are primarily comprised of (a) building and maintaining the remax.com and remax.ca websites and mobile apps, (b) agent and consumer-facing technology via the BoldTrail platform (refer to the Company’s 2025 Annual Report on Form 10-K for further details), (c) dedicated employees focused on consumer-facing marketing initiatives, and (d) various administrative services including customer support of technology, accounting and legal.

Costs charged from Real Estate to the Marketing Funds are as follows (in thousands):


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2026		2025		2026		2025
Technology - operating	$	4,910	$	4,364	$	9,837	$	7,955
Marketing staff and administrative services		2,904		2,256		6,016		4,563
Total	$	7,814	$	6,620	$	15,853	$	12,518

Other Current Assets and Other Assets, Net of Current Portion

Other current assets and Other assets, net of current portion consist of the following (in thousands):


	June 30,		December 31,
	2026		2025
Prepaid expenses	$	10,722	$	10,472
Capitalized contract costs		1,304		1,055
Other		700		413
Other current assets	$	12,726	$	11,940

Capitalized contract costs, net of current portion	$	4,717	$	3,263
Notes receivable, net of current portion		1,625		1,791
Other		938		1,251
Other assets, net of current portion	$	7,280	$	6,305

Leases

The Company leases corporate offices, a distribution center, billboards and certain equipment. As all franchisees are independently owned and operated, there are no leases recognized for any offices used by the Company’s franchisees. All of the Company’s material leases are classified as operating leases. The Company acts as the lessor for sublease agreements on its corporate headquarters, consisting solely of operating leases.

Foreign Currency Derivatives

The Company is exposed to foreign currency transaction gains and losses related to certain foreign currency denominated asset and liability positions, with the Canadian dollar representing the most significant exposure primarily from an intercompany Canadian loan between RMCO and the Canadian entity for RE/MAX INTEGRA (“INTEGRA”). The Company uses short duration foreign currency forward contracts, generally with maturities ranging from a few days to a few months, to minimize its exposures related to foreign currency exchange rate fluctuations. None of these contracts are designated as accounting hedges as the underlying currency positions are revalued through “Foreign currency transaction gains (losses)” on the Condensed Consolidated Statements of Income (Loss) along with the related derivative contracts. Maturities of the foreign currency forward contracts are included within “Net cash provided by operating activities” on the Condensed Consolidated Statements of Cash Flows, with any non-cash portion included as a component of “Changes in operating assets and liabilities” on the Condensed Consolidated Statements of Cash Flows. During the three months ended June 30, 2026, and 2025, the Company recognized a net gain of $0.6 million and net loss of $1.6 million, respectively. During the six months ended June 30, 2026 and 2025, the Company recognized a net gain of $1.2 million and a net loss of $1.5 million, respectively.

The Company has a short-term $44.0 million Canadian dollar forward contract that matures in the third quarter of 2026 that net settles in U.S. dollars based on the prevailing spot rates at maturity.

Arrangement Agreement and Plan of Merger with The Real Brokerage Inc

Arrangement Agreement and Plan of Merger with The Real Brokerage Inc.

On April 26, 2026, RE/MAX Holdings, Inc. (“Holdings” or the “Company”) entered into an Arrangement and Plan of Merger (as may be amended, modified or supplemented from time to time, the “Merger Agreement”) to be acquired by The Real Brokerage Inc. (“Real”). Pursuant to the Merger Agreement, a new holding company, Real REMAX Group Inc., will be formed to combine Real and Holdings into a single publicly traded company (the “Merger”) expected to be listed on the Nasdaq Stock Market under the ticker symbol “REAX.”

Under the terms of the Merger Agreement, each outstanding share of RE/MAX Holdings, Inc. Class A common stock will be converted into the right to receive either (i) 5.15 shares of Real REMAX Group Inc. common stock, to be adjusted to reflect a 10-for-1 share consolidation prior to transaction close, or (ii) $13.80 in cash, subject to proration such that the aggregate cash consideration is between a minimum of $60 million and a maximum of $80 million. Upon closing, ownership of the combined company is expected to be approximately 60% held by former Real shareholders and 40% held by former RE/MAX Holdings, Inc. shareholders, assuming the maximum cash election.

The transaction is intended to qualify as a tax‑free exchange for U.S. federal income tax purposes and is subject to regulatory approvals, the approval by the shareholders of both companies, and customary closing conditions. On July 13, 2026, the U.S. Department of Justice granted early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), related to the Merger. Both companies plan to hold special meetings for their respective shareholders on August 14, 2026. The merger is expected to close in the second half of 2026.

In connection with the Merger, Real has obtained committed financing in an aggregate amount of up to $550 million, led by Morgan Stanley Senior Funding, Inc. and Apollo Global Funding, LLC. The financing is expected to be used to fund the cash portion of the merger consideration and transaction costs and to refinance the Company’s existing indebtedness at closing. The financing commitments are subject to customary terms and conditions and are not expected to be a condition to the completion of the transaction. Merger related transaction costs, primarily related to legal expenses, is recorded to “Merger transaction costs” in the accompanying Condensed Consolidated Statements of Income (Loss) and is primarily recorded to “Accrued liabilities” within the Condensed Consolidated Balance Sheets. Merger related transaction costs are included in the Real Estate segment.

The Merger Agreement contains customary representations, warranties and covenants, including covenants relating to the conduct of the Company's business during the period between execution and closing, and non-solicitation obligations subject to customary exceptions for superior proposals and other matters. Consummation of the Mergers is subject to the satisfaction or waiver of customary closing conditions, including, among others, approval by the Company's stockholders and Real's shareholders, regulatory approvals and the consummation of the RIHI Merger (defined below). The Merger Agreement may be terminated by either party under certain circumstances, including if the Mergers have not closed within nine months (subject to two automatic extensions of 45 days each under specified circumstances), or upon the failure to receive required stockholder or shareholder approvals. Upon termination under certain specified circumstances, a termination fee may be payable by either the Company or Real.

RIHI Merger and Elimination of Up-C Structure

Concurrent with the execution of the Merger Agreement, the Company entered into a separate Agreement and Plan of Merger with RIHI, Inc. (“RIHI”) and certain merger subsidiaries of the Company (the "RIHI Merger Agreement") providing for the merger of a wholly owned subsidiary of the Company with and into RIHI and then the merger of the resulting company with and into another wholly-owned subsidiary of the Company (collectively, the “RIHI Merger”). RIHI is the holder of the single outstanding share of the Company's Class B common stock and of the common units of RMCO not held by the Company. Upon the effectiveness of the RIHI Merger (i) each outstanding share of RIHI common stock will be converted into a number of shares of the Company’s Class A common stock based on exchange ration set forth in the RIHI Merger Agreement, and (ii) the share of the Company’s Class B common stock and the RMCO common units, each held by RIHI will be surrendered to the Company. As a result, the Company will acquire RIHI as the holder of such securities, thereby eliminating the Company’s existing Up-C structure. The share of Company Class A common stock received by the shareholders of RIHI pursuant to the RIHI Merger will thereafter be converted into the right to receive the Merger Consideration (as defined in the Merger Agreement) in the Mergers. Consummation of the RIHI Merger is a condition to closing the Mergers.

Amendment to Tax Receivable Agreement

Concurrently with the execution of the Merger Agreement, the Company and RIHI entered into Amendment No. 1 (the “RIHI TRA Amendment”) to the Tax Receivable Agreement, dated October 7, 2013, between the Company and RIHI (the "RIHI TRA"), pursuant to which the RIHI TRA will terminate upon the closing of the Mergers or any other Qualifying Change of Control (as defined in the RIHI TRA Amendment), and no Early Termination Payment, Tax Benefit Payment (each as defined in the RIHI TRA Amendment) or other payment will be made to RIHI thereunder. If a Qualifying Change of Control does not occur within eighteen months of the date of the RIHI TRA Amendment, the RIHI TRA Amendment will be void and of no further effect.

Support Agreement

In connection with the Merger Agreement, holders of shares of Company common stock representing approximately 38% of the Company's outstanding voting power entered into a support agreement pursuant to which they agreed to vote their shares in favor of the adoption of the Merger Agreement, subject to customary terms and conditions.

For additional information on the Merger, see the Company’s Current Report on Form 8-K filed with the SEC on April 28, 2026.