Summary of Significant Accounting Policies

Basis of Consolidation

The condensed consolidated financial statements incorporate the financial statements of the Company and its wholly-owned subsidiaries and controlled entities.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary.

All significant intercompany balances and transactions have been eliminated in consolidation.

Revenue Recognition

The Company generates most of its revenue from contracts with customers. Its principal revenue streams are described below:

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Brokerage. Brokerage revenue consists primarily of commissions earned on the sale of real estate transactions. The Company is contractually obligated to provide services for the fulfillment of transfer of real estate between buyers and sellers (its customers). The Company satisfies its performance obligations through closing of a transaction and provides services between the agents and buyers and sellers as a principal (the Company holds the brokerage license which is essential for the real estate transaction). Accordingly, the Company recognizes revenues in the gross commission amount of consideration.

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Franchise. Franchise revenue consists primarily of fees associated with franchising the REMAX brand. Franchise agreements provide franchisees common use and promotion of REMAX trademarks; access to related marketing and promotional materials; technology; tools and education; standardized supplies and recommended procedures for operations of REMAX offices. The Company concluded that these benefits are highly related and all part of one performance obligation for each franchise agreement, a license of symbolic intellectual property that is billed through a variety of fees as described below.

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Continuing franchise fees are fixed contractual fees paid monthly by regional franchise owners based on the number of affiliated agents in the respective franchised region or office. Continuing franchise fees are recognized in the month for which the fee is billed.

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Annual dues are fixed membership fees paid annually by REMAX agents directly to the Company. The Company defers the annual dues revenue when billed and recognizes the revenue ratably over the applicable 12-month period. See “Deferred Revenue” and “Capitalized Contract Costs” below for a reconciliation of the activity in the Company’s deferred revenue for annual dues.

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Broker fees are assessed against real estate commissions paid by customers when a REMAX agent advises on the purchase or sale of a property. Generally, the amount paid is 1% of the total commission on the transaction and the revenue from broker fees is recognized in the month when a home sale transaction occurs. The Company has pricing components that cap broker fees at certain commission levels. For franchise agreements containing capped broker fee arrangements, revenue is estimated and recognized ratably over the applicable period.

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Franchise sales and renewals are recognized over the contractual term of the franchise agreement, which is typically five years for REMAX. See “Deferred Revenue” and “Capitalized Contract Costs” below for a reconciliation of the activity in the Company’s deferred revenue for franchise sales.

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Marketing Funds fees are fixed contractual fees paid monthly by franchisees based on the number of REMAX agents in the respective franchised region or office. The Company is obligated to use these funds for franchise marketing and related activities to build brand awareness and to support agent marketing technology. Amounts received into the Marketing Funds are recognized as revenue in the month for which the fee is billed.

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All assets of the Marketing Funds are contractually restricted for the benefit of franchisees, and the Company recognizes an equal and offsetting liability on the Company’s balance sheet for all amounts received. This results in recording an equal and offsetting amount of expenses, against all revenues such that there is no impact to overall profitability of the Company from these revenues.

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Other revenue consists primarily of mortgage brokerage, title and escrow, financial technology, mortgage franchising and mortgage processing services. Mortgage brokerage revenue is recognized when loans are

funded, while title and escrow revenue is recognized upon closing of the related transactions. Real Wallet service fees are recognized as services are provided, and interest income on lending products is recognized as earned. Mortgage franchise fees are recognized over the applicable service periods, while mortgage processing revenue is recognized as services are performed.

Deferred Revenue and Capitalized Contract Costs

Deferred revenue primarily relates to franchise sales and renewals, annual dues, and broker fees. Other deferred revenue primarily relates to events and related services. Deferred revenue is included in “Deferred revenue” and “Deferred revenue, net of current portion” on the Condensed Consolidated Balance Sheets. Changes in deferred revenue were as follows (in thousands):


	Balance at				Revenue		Balance at
	August 24, 2026^(a)		New billings		recognized		September 30, 2026
Franchise sales	$	16,694	$	98	$	(1,298)	$	15,494
Annual dues		11,482		2,889		(3,053)		11,318
Broker fees and Other		5,407		3,581		(4,802)		4,186
	$	33,583	$	6,568	$	(9,153)	$	30,998

(a)	The Company assumed contract liabilities in connection with the Transaction on August 24, 2026. Accordingly, the opening contract liability balance presented for purposes of the revenue recognition disclosure is the balance as of the acquisition date rather than as of January 1, 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
	August 24, 2026^(a)		for new activity ^(b)		recognized		September 30, 2026
Capitalized contract costs	$	5,878	$	16	$	(574)	$	5,320

(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 presents revenue expected to be recognized from unsatisfied or partially unsatisfied performance obligations as of September 30, 2026 (in thousands):


	Remainder of 2026		2027		2028		2029		2030		2031		Thereafter		Total
Franchise sales	$	1,393	$	4,838	$	3,641	$	2,485	$	1,466	$	575	$	1,096	$	15,494
Annual dues		5,306		6,012		—		—		—		—		—		11,318
Total^(a)	$	6,699	$	10,850	$	3,641	$	2,485	$	1,466	$	575	$	1,096	$	26,812

(a)

This amount differs from total deferred revenue of $31.0 million because deferred revenue also includes approximately $4.2 million related to broker fees and other arrangements for which the Company expects to recognize substantially all of the associated revenue within one year and has elected to apply the practical expedient not to disclose the related remaining performance obligations.

Disaggregated Revenue

In the following table, revenue is disaggregated by segment and by geographical area (in thousands):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2026		2025		2026		2025
U.S.	$	612,538	$	494,620	$	1,668,786	$	1,288,888
Canada		81,458		69,361		180,996		162,486
Global		1,503		1,326		4,643		3,127
Brokerage		695,499		565,307		1,854,425		1,454,501
U.S.		18,500		-		18,500		-
Canada		6,526		-		6,526		-
Global		2,072		-		2,072		-
Franchise		27,098		—		27,098		—
U.S.		5,245		3,163		12,271		8,581
Canada		86		79		260		195
Other		5,331		3,242		12,531		8,776
Total	$	727,928	$	568,549	$	1,894,054	$	1,463,277

Cash, Cash Equivalents and Restricted Cash

In the Condensed Consolidated Balance Sheets, cash and cash equivalents include cash on hand, demand deposits, and highly liquid investments, including money market funds, that are readily convertible into known amounts of cash and subject to an insignificant risk of changes in value.

Restricted cash consists primarily of funds held in escrow on behalf of real estate customers and funds contractually restricted for franchise marketing and related activities. Escrow funds are held on behalf of buyers and sellers in connection with real estate transactions and are not available for the Company's general operating purposes. The Company recognizes corresponding liabilities for customer deposits and restricted Marketing Funds balances, as applicable.

The following table reconciles cash, cash equivalents, and restricted cash reported within the Condensed Consolidated Balance Sheets to the total of the same amounts shown on the condensed consolidated statements of cash flows:


	September 30, 2026		December 31, 2025
Cash and cash equivalents	$	102,526	$	33,213
Restricted cash:
Marketing Funds ^(a)		18,591		—
Settlement Fund ^(b)		1,500		—
Customer Deposits & Other ^(c)		42,215		26,338
Total cash, cash equivalents and restricted cash	$	164,832	$	59,551

(a)	All cash held by the Marketing Funds is contractually restricted, pursuant to the applicable franchise agreements.

(b)	Represents the amount held in the qualified settlement escrow fund under the Batton Settlement Agreement (as defined below). See Note 14, Commitments and Contingencies, for additional information.

(c)	Customer deposits and other cash is held in escrow by the Company’s brokers and agents on behalf of real estate buyers where the Company does not have unilateral access to the funds. The Company recognizes a corresponding customer deposit liability until the funds are released.

Accounts And Notes Receivable

Accounts and Notes Receivable

Accounts receivable arise primarily from Brokerage and Franchise operations and generally do not bear interest. The Franchise business also provides limited financing of certain franchise sales through the issuance of notes receivable, with associated interest recognized in interest income. Amounts collected on notes receivable are included in “Net cash provided by operating activities”. As of September 30, 2026, the current portion of notes receivable was approximately $2.0 million and is included in “Accounts and notes receivable, net of allowances” on the Condensed Consolidated Balance Sheets.

The Company maintains allowances for expected credit losses on accounts and notes receivable based on historical experience, customer-specific credit risk, and current and forecasted economic conditions. Changes in the allowances are recognized in “General and administrative expenses” in the accompanying Condensed Consolidated Statements of Comprehensive Income (Loss). As of September 30, 2026, the total allowance for expected credit losses related to the Franchise business was $0.7 million.

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):


	September 30,		December 31,
	2026		2025
Prepaid expenses	$	13,940	$	2,194
Capitalized contract costs		1,144		—
Taxes Receivable		8,176		296
Other		901		543
Other current assets	$	24,161	$	3,033

Capitalized contract costs, net of current portion	$	4,176	$	—
Notes receivable, net of current portion		2,941		2,308
Other		465		—
Other assets, net of current portion	$	7,582	$	2,308

Leases

The Company determines whether an arrangement contains a lease at inception. The Company’s leases consist primarily of operating leases for office space, and are included within “Operating lease right of use assets”, “Operating lease liabilities” and “Operating lease liabilities, net of current portion” on the Condensed Consolidated Balance Sheets.

Operating lease right-of-use (“ROU”) assets and lease liabilities are recognized at commencement based on the present value of lease payments over the lease term. When an implicit rate is not readily determinable, the Company uses its incremental borrowing rate in determining the present value of lease payments. Renewal options are included in the lease term when reasonably certain to be exercised.

Operating lease expense is recognized on a straight-line basis over the lease term and is recorded to “General and administrative expenses.” Variable lease payments consist of non-lease services related to the lease. Variable lease payments are excluded from the ROU assets and lease liabilities and are expensed as incurred.

The Company has made an accounting policy election not to recognize ROU assets and lease liabilities for leases with terms of 12 months or less that do not contain a purchase option reasonably certain to be exercised. Lease expense for these arrangements is recognized on a straight-line basis over the lease term.

Research and Development

Research and development expense consists primarily of salaries and benefits, stock-based compensation, and other related expenses. The Company expenses research and development costs as incurred and records them in research and development expenses, except as described under “Capitalized Software” above.

Income Taxes

The Company accounts for income taxes using the asset and liability method under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 740, Income Taxes. Deferred tax assets and liabilities are recognized for the future tax consequences of operating loss and tax credit carryforwards, and temporary differences between the financial statement carrying amounts and the tax bases of assets and liabilities. These balances are measured using enacted tax rates expected to apply when the differences reverse. A valuation allowance is recorded to reduce deferred tax assets if it is more likely than not that some or all of the assets will not be realized.

The tax benefit of an uncertain tax position is recognized only if it is more likely than not to be sustained upon examination. Interest and penalties related to unrecognized tax benefits are recorded within the provision for income taxes.

Foreign Currency Derivatives

The Company uses short-term foreign currency forward contracts to manage exposure to foreign currency exchange rate fluctuations, primarily related to Canadian dollar-denominated intercompany balances. These contracts generally mature within a few months and are not designated as accounting hedges. Changes in the fair value of the contracts, together with foreign currency gains and losses on the underlying monetary balances, are recognized in “Other expenses, net” on the Condensed Consolidated Statements of Comprehensive Income (Loss).

Cash flows associated with these contracts are included within “Net cash provided by operating activities” on the Condensed Consolidated Statements of Cash Flows. The net gain recognized by the Company for both the three and nine months ended September 30, 2026 was immaterial.

Goodwill

Goodwill represents the excess consideration transferred over the estimated fair value of identified net assets acquired and liabilities assumed in a business combination. The Company evaluates goodwill for impairment on an annual basis in the fourth fiscal quarter or on an interim basis if an event occurs or circumstances indicate potential impairment.

The Company may first perform a qualitative assessment to determine whether it is more likely than not that a reporting unit’s fair value is less than its carrying value. If the assessment indicates potential impairment, or if the Company elects to bypass the qualitative assessment, a quantitative impairment test is performed by comparing the reporting unit’s fair value with its carrying amount. An impairment loss is recognized to the extent the carrying amount exceeds fair value.

Business Combinations

The Company accounts for business combinations using the acquisition method, under which the purchase consideration is allocated to identifiable tangible and intangible assets acquired and liabilities assumed based on their estimated acquisition-date fair values, with any excess recorded as goodwill. Contingent consideration, when applicable, is measured at fair value as of the acquisition date.

Estimating fair values requires significant judgments, estimates and assumptions including but not limited to: discount rates, future cash flows and the economic lives of acquired intangible assets. These estimates are based on historical experience and information obtained from the management of the acquired companies and are inherently uncertain.

Advertising Costs

Advertising costs are expensed as incurred and included in marketing expenses in the accompanying Condensed Consolidated Statements of Comprehensive Income (Loss).

Related Party Transactions

The Company makes certain payments to one of its directors for services provided in the director’s capacity as a real estate agent. Such payments include commissions, revenue share, and equity-based awards, which are recorded within cost of sales and marketing expenses. These transactions are conducted at arm’s-length terms and are immaterial to the Company.