Real Brokerage : Annual Report of 2025 Annual Report

Published: 2026-04-24 10:54:14 ET REAX

Published on 04/24/2026 at 10:54 am EDT

The Real Brokerage Inc. Management's Discussion and Analysis for the period ended December 31, 2024 and 2023

UNAUDITED

2025

Full Speed Ahead

Annual Report and MD&A The Real Brokerage Inc.

+128148%

The Real Brokerage Inc. Management's

AGnronsusaPl rRoefivtenue Discussion and Analysis for the period

ended December 31, 2024 and 2023

UNAUDITED

Corporate Overview

Real (NASDAQ: REAX) is a real estate experience company working to make life's most complex transaction simple. The fast-growing company combines essential real estate, mortgage and closing services with powerful technology to deliver a single seamless end-to-end consumer experience, guided by trusted agents. With a presence in all 50 states throughout the U.S. and five Canadian provinces, Real supports over 33,000 agents who use its digital brokerage platform and tight-knit professional community to power their own forward-thinking businesses.

Key 2025 Metrics

+56%

Revenue

Revenue increased 56% to $2.0 billion in 2025, from

$1.3 billion in 2024.

+31%

Agents

Reached 31,739 agents as of December 2025, a 31% increase

from 24,140 as of December 2024.

+53%

Value of Homes Sold

The total value of homes sold increased to $75 billion in 2025, 53% higher than in 2024.

+44%

Gross Profit

Gross profit increased 44% to $166 million in 2025, from

$115 million in 2024.

+54%

Transactions

The total number of transactions closed on our platform grew to over 185,000 in 2025, a 54% increase compared with 2024.

+35%

Cash from Operations Cash from operating activities increased 35% to $66 million in 2025, from $49 million in 2024.

To Our Shareholders,

2025 was another breakthrough year for Real. Against a housing market that remained near cyclical lows, we delivered record results, while meaningfully improving the quality of our platform and agent value proposition. Full-year revenue grew 56% to nearly $2.0 billion, gross profit increased 44% to $166 million, and we processed more than 185,000 transactions, all organic. We achieved our first ever quarter of positive GAAP net income, full-year adjusted EBITDA reached $62.9 million

- up 57% year-over-year - and we generated $66 million in operating cash flow. We returned $39 million to shareholders through buybacks while maintaining a debt-free balance sheet.

Our agent base grew to 31,739 by year-end, up 31%, and has since surpassed 33,000. Approximately 85% of that growth continues to come from agents attracting other agents - the most powerful validation of our model and our culture. Transactions per agent continued to outpace the industry, and revenue churn improved to near record lows. The agents choosing Real are among the most productive in the business, and they are staying.

Technology remains a distinct competitive advantage. In 2025, Leo CoPilot - our AI-powered assistant embedded inside our reZEN software - surpassed 700,000 agent interactions and autonomously handled approximately 46% of all support volume in the second half of the year. Our AI automation team, launched mid-year, delivered workflow automations saving thousands of hours annually, allowing us to scale without commensurately scaling headcount.

In Q4, we beta launched HeyLeo.com in certain states. HeyLeo.com is an AI-powered home search portal giving every Real agent their own intelligent client engagement tool, backed by deep MLS integrations and real-time neighborhood data. The transaction lifecycle, from first consumer search to final commission payout, is being rebuilt on our platform.

Our ancillary businesses - One Real Mortgage, One Real Title, and Real Wallet - generated $11.9 million in combined revenue in 2025. Real Wallet's first full year was particularly encouraging: nearly $900,000 in high-margin revenue, over 7,000 active agents, $23 million in deposits, and more than $8 million in credit lines extended to our agents. These businesses generate gross margins significantly higher than core brokerage and create switching costs that deepen agent loyalty over time. We are still early, and believe the opportunity to grow these business lines remains substantial.

We enter 2026 with conviction and a platform unlike anything else in this industry. The housing market will recover - and when it does, we believe Real is well positioned to capture an outsized share. We are not waiting for that tailwind. We are building into it, full speed ahead. Thank you to our 33,000+ agents, our team, and our shareholders for your belief in this mission.

Sincerely,

Chairman and CEO, The Real Brokerage Inc.

Report of Independent Registered Public Accounting Firm (PCAOB ID No. 1197) . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Consolidated Financial Statements: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Consolidated Balance Sheets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Consolidated Statements of Comprehensive Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Consolidated Statements of Changes in Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Consolidated Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Notes to the Consolidated Financial Statements 9-37

We have audited the accompanying consolidated balance sheets of The Real Brokerage Inc. and subsidiaries (the "Company") as of December 31, 2025 and 2024, the related consolidated statements of comprehensive loss, changes in equity, and cash flows, for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 4, 2026 expressed an unqualified opinion on the Company's internal control over financial reporting.

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Revenue Share - Refer to Note 2Y and Note 4 to the financial statements.

Critical Audit Matter Description

revenue sharing plan is based on (1) the number of qualifying agents attracted to the Company and (2) the amount earned by the Company from real estate transactions consummated by such agents.

Revenue share calculation is based on multi-tiered compensation structure and limited to maximum amount to be paid per agent attracted to the Company. The calculation is performed using an internally developed system and is based on conditions determined in the revenue sharing plan.

We identified revenue share expense as a critical audit matter because of the complexity of the automated calculations, significant volume of data and multiple parameters involved in the calculation of revenue share expenses. This required an increased extent of audit effort to audit and evaluate the accuracy of revenue share expenses recorded under the revenue sharing plan.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to revenue share included the following, among others:

With the assistance of our IT specialists, we:

Identified the significant system used to process revenue share transactions and tested the general IT controls over the system, including testing of user access controls, change management controls, and IT operations controls.

Performed testing of automated controls for the system calculation of revenue share and the system determination of qualifying active agents.

We selected samples of agents and tested their association with the respective attracting agent by reading independent contractor agreements and tested appropriateness of the agent as a qualifying agent by obtaining evidence of agents reaching the required sales transaction volume.

For a sample of revenue share expenses, we performed detail testing by recalculating the revenue sharing allocation in accordance with the terms of the revenue sharing plan and traced underlying transactions data to third party documents such as settlement statements or residential purchase agreements.

Tel Aviv, Israel March 4, 2026

We have served as the Company's auditor since 2014.

We have audited the internal control over financial reporting of The Real Brokerage Inc. and subsidiaries (the "Company") as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2025, of the Company and our report dated March 4, 2026, expressed an unqualified opinion on those financial statements.

The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Tel Aviv, Israel March 4, 2026

(U.S. dollars and shares in thousands)

‌As of‌

December 31, 2025 December 31, 2024

ASSETS

CURRENT ASSETS

Cash and cash equivalents

33,213

23,376

Restricted cash

26,338

24,089

Investments in financial assets

16,731

9,449

Trade receivables

20,170

14,235

Short-term financing receivables, net

6,231

Other current assets

3,081

1,762

TOTAL CURRENT ASSETS

105,764

72,911

NON-CURRENT ASSETS

Intangible assets, net

4,157

2,575

Goodwill

8,993

Property and equipment, net

2,455

2,116

Investment in equity securities

2,250

Long-term financing receivables, net

2,311

Deferred tax asset

931

TOTAL NON-CURRENT ASSETS

21,097

13,684

TOTAL ASSETS

126,861

86,595

LIABILITIES AND EQUITY

CURRENT LIABILITIES

Accounts payable

1,161

1,374

Accrued liabilities

38,205

25,939

Customer deposits

26,338

24,089

Other payables

9,562

3,050

TOTAL CURRENT LIABILITIES

75,266

54,452

NON-CURRENT LIABILITIES

Deferred tax liability

TOTAL NON-CURRENT LIABILITIES

TOTAL LIABILITIES

75,276

54,452

EQUITY

EQUITY ATTRIBUTABLE TO OWNERS

Common Shares, no par value, unlimited Common Shares authorized, 210,478 Shares issued and outstanding at December 31, 2025; and 202,941 Shares issued and 202,499 outstanding at December 31, 2024

Additional paid-in capital

164,208

138,639

Accumulated deficit

(112,851)

(104,746)

Accumulated other comprehensive income

318

708

Treasury stock, at cost, 0 and 442 Common Shares at December 31, 2025 and December 31, 2024, respectively

(2,455)

EQUITY ATTRIBUTABLE TO OWNERS

51,675

32,146

Non-controlling interests

(90)

(3)

TOTAL EQUITY

51,585

32,143

TOTAL LIABILITIES AND EQUITY

126,861

86,595

The accompanying notes form an integral part of the consolidated financial statements.

(U.S. dollars and shares in thousands, except per share amounts)

2025

2024

Revenues

$ 1,968,416

$ 1,264,639

Cost of Sales

1,802,728

1,149,898

Gross Profit

165,688

114,741

General and administrative expenses

74,359

61,084

Marketing expenses

82,383

57,477

Research and development expenses

17,443

12,156

Settlement of litigation

750

9,250

Operating Expenses

174,935

139,967

Operating Loss

(9,247)

(25,226)

Other income, net

995

496

Finance expenses, net

(554)

(1,723)

Loss Before Tax

(8,806)

(26,453)

Tax Benefit

(740)

Net Loss

$ (8,066)

$ (26,453)

Net income attributable to non-controlling interests

Net Loss Attributable to the Owners of the Company

$ (8,105)

$ (26,541)

Other comprehensive income/(loss), Items that will be

Unrealized gain (loss) on investments in financial assets

(212)

Foreign currency translation adjustment

(178)

794

Total Comprehensive Loss Attributable to Owners of the Company

(8,495)

(25,666)

Total Comprehensive Income Attributable to Non-Controlling Interest

Total Comprehensive Loss

$ (8,456)

$ (25,578)

Loss per share

Basic loss per share

$ (0.04)

$ (0.14)

Diluted loss per share

$ (0.04)

$ (0.14)

Weighted-average shares, basic and diluted

219,873

191,172

reclassified subsequently to profit or loss:

The accompanying notes form an integral part of the consolidated financial statements.

(U.S. dollars in thousands)

Balance at, January 1, 2025

$ 138,639

$ (104,746) $

708

$ (2,455) $

32,146

$ (3) $

32,143

Total net income (loss)

(8,105)

(8,066)

Total other comprehensive loss

(390)

Distributions to non-controlling interests

(126)

Repurchase of common shares

(39,363)

Release of treasury stock

(9,335)

9,335

Retirement of treasury stock

(32,483)

32,483

Exercise of stock options

2,169

Shares withheld for taxes

(2,928)

Equity-settled stock-based payment

68,146

Balance at, December 31, 2025

$ 164,208

$ (112,851) $

318

$ - $

51,675

$ (90) $

51,585

Balance at, January 1, 2024

$ 115,504

$ (78,205) $

(167) $

(257) $

36,875

$ 209

$ 37,084

Total net income (loss)

(26,541)

(26,453)

Total other comprehensive income

875

Distributions to non-controlling interests

(300)

Repurchase of common shares

(36,283)

Release of treasury stock

(34,085)

34,085

Exercise of stock options

6,275

Exercise of warrants

861

Shares withheld for taxes

(2,832)

Equity-settled stock-based payment

52,916

Balance at, December 31, 2024

138,639 $

(104,746) $

708

(2,455) $

32,146 $

(3) $

32,143

The accompanying notes form an integral part of the consolidated financial statements.

(U.S. dollars in thousands)

‌Twelve Months Ended December 31,

2025

2024

OPERATING ACTIVITIES

Net Loss

(8,066)

(26,453)

Adjustments to reconcile net loss to net cash provided by operating

Depreciation and amortization

1,929

1,396

Equity-settled stock-based payment

68,146

52,916

Finance costs

(180)

376

Change in fair value of warrants liability

600

Deferred income taxes, net

(921)

Changes in operating assets and liabilities:

Trade receivables

(5,935)

(7,794)

Financing receivables, net

(8,542)

Other current assets

(1,319)

433

Accounts payable

(213)

803

Accrued liabilities

12,266

12,565

Customer deposits

2,249

11,141

Other payables

6,512

2,748

NET CASH PROVIDED BY OPERATING ACTIVITIES

65,926

48,731

INVESTING ACTIVITIES

Purchase of investment in equity securities

(2,250)

Purchase of property and equipment

(1,100)

(1,045)

Purchase of intangible assets

(2,750)

Purchase of financial assets

(16,053)

(1,692)

Proceeds from sale of financial assets

8,559

6,546

NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES

(13,594)

3,809

FINANCING ACTIVITIES

Repurchase of common shares

(39,363)

(36,283)

Payment of employee taxes on certain stock-based arrangements

(2,928)

(2,832)

Proceeds from exercise of stock options

2,169

6,275

Distributions to non-controlling interest

(126)

(300)

NET CASH USED IN FINANCING ACTIVITIES

(40,248)

(33,140)

Net change in cash, cash equivalents and restricted cash

12,084

19,400

Cash, cash equivalents and restricted cash, beginning of period

47,465

27,655

Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash

410

CASH, CASH EQUIVALENTS AND RESTRICTED CASH, ENDING BALANCE

59,551

47,465

SUPPLEMENTAL DISCLOSURE OF NON-CASH ACTIVITIES

Warrants exercised

861

The accompanying notes form an integral part of the consolidated financial statements

The Real Brokerage Inc. ("Real" or the "Company") is a growing real estate technology company that operates across all 50 U.S. states, the District of Columbia, and five Canadian provinces. As a licensed real estate brokerage, the Company's revenue is generated primarily by processing real estate transactions which entitle us to commissions. The Company pays a portion of its commission revenue to real estate agents who are affiliated with the Company. Real operates as a fully digital brokerage and offers ancillary services such as mortgage origination, title and escrow services, and financial technology and lending products.

The significant accounting policies described below have been applied consistently to all periods presented.

These consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("U.S. GAAP").

The consolidated financial statements incorporate the financial statements of the Company, its wholly-owned subsidiaries and entities in which we have a controlling interest in. Intercompany transactions and balances are eliminated upon consolidation.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Specifically, the results of subsidiaries acquired or disposed of during the year are included in profit or loss from the date the Company gains control until the date when the Company ceases to control the subsidiary.

Where necessary, adjustments are made to the financial statements of subsidiaries to ensure subsidiaries' accounting policies are in line with Company's accounting policies.

All intragroup assets and liabilities, equity, income, expenses, and cash flows relating to transactions between the members of the Company and its subsidiaries are eliminated on consolidation.

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 legal contingencies, income taxes, revenue recognition, stock-based compensation, intangible assets, 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.

We operate in the residential real estate industry and are a technology-focused company. Accordingly, we are affected by a variety of factors that could have a significant negative effect on our future financial position, results of operations, and cash flows. These factors include: negative macroeconomic factors affecting the health of the

residential real estate industry, negative factors disproportionately affecting markets where we derive most of our revenue, intense competition in the residential real estate industry, changes in prevailing interest rates, maintaining and managing rapid growth and maintaining compliance with applicable laws and regulations.

Certain financial instruments, primarily cash and cash equivalents and investments, potentially subject us to concentrations of credit risk. We generally place our cash and cash equivalents and investments with major financial institutions we deem to be of high-credit-quality in order to limit our credit exposure. We maintain our cash accounts with financial institutions where deposits exceed federal insurance limits. Credit risk in regard to accounts receivable is spread across a large number of customers.

These consolidated financial statements are presented in U.S. dollars, which is the Company's functional currency. All amounts have been rounded to the nearest thousands of dollars, unless otherwise noted.

Foreign currency transactions and balances

Transactions in foreign currencies are initially recognized in the financial statements using foreign currency rates prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currencies are translated to the relevant functional currency at the foreign currency rates prevailing at the reporting date. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the foreign currency rate at the date that the fair value was determined. Non-monetary assets and liabilities denominated in a foreign currency and measured at historical cost are translated at the foreign currency rate prevalent at the date of transaction. Foreign currency differences arising on translation are recognized in the consolidated statements of comprehensive loss for determination of net profit or loss during the period.

Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated to the functional currency at foreign currency rates at the reporting date. The income and expenses of foreign operations and cash flows are translated using average exchange rates during the period. Such differences are included in accumulated other comprehensive income or loss. When a foreign operation is disposed of, in part or in full, the relevant amount within accumulated other comprehensive income or loss is transferred to profit or loss.

The Company uses judgment in determining its operating segments by taking into consideration the Chief Operating Decision Maker's ("CODM") assessment of overall performance and decisions such as resource allocations and delegation of authority.

The segment information disclosed in these consolidated Financial Statements reflects historical results consistent with the identifiable reportable segments of The Real Brokerage Inc. and financial information that the CODM reviews to evaluate segment performance and allocate resources among the segments. The CODM is the Company's Chief Executive Officer.

Detailed segment information is disclosed in Note 5.

The Company generates substantially all of its revenue from commissions generated from the sale of real estate properties. Other sources of revenue relate to ancillary services.

The Company is contractually obligated to provide services for the fulfillment of transfer of real estate between buyers and sellers. The Company satisfies its performance obligations through closing of a transaction and provides

services between the agents and buyers and sellers as a principal. Accordingly, the Company recognizes revenues in the gross commission amount of consideration, to which it expects to be entitled to.

Please see Note 3 for more information about the Company's revenues from contracts with customers.

Performance obligations and revenue recognition policies

Revenue is measured based on the consideration specified in a contract with a customer. The Company recognizes revenue upon the satisfaction of its performance obligation when it transfers control over a good or service to a customer.

The following table provides information about the nature and timing of the satisfaction of performance obligations in contracts with customers, including significant payment terms, and related revenue recognition policies.

Nature of timing of satisfaction of performance obligations including

Type of product or service

significant payment terms

Revenue recognition policies

Commissions from real estate

Customers obtain control of real

Revenue is recognized at a point in

contracts

estate property on the closing date,

time as the purchase agreement is

which is ordinarily when

closed and the sale is executed

consideration is received

Title Fees (Escrow and Title

Customers obtain control of real

Revenue is recognized at a point in

Insurance)

estate property on the closing date,

time when the transaction is closed

which is ordinarily when

and paid

consideration is received

Mortgage Broker

Customers obtain control of real

Revenue is recognized at a point in

estate property on the closing date,

time when the loan has been funded

which is ordinarily when

consideration is received

Wallet

Transaction based fees are

Revenue is recognized either at a

recognized when the service is

point in time or over time depending

performed, while interest income

on the nature of the service

from deposit and credit lines is

provided

recognized over time as it accrues

based on the effective interest rate

Cost of Sales consists primarily of real estate commissions paid to the Company's agents and to outside brokerages in Canada, net of certain fees the company charges the agents, as well as expenses related to mortgage, title, and wallet services.

The Company's real estate agents have the opportunity to receive remuneration in the form of stock-based compensation, whereby those agents are entitled to restricted share units. In addition, the Company grants its employees and members of the board of directors' remuneration in the form of stock-based compensation, whereby employees and the board of directors render services in consideration for equity instruments.

Stock-based payment arrangements

The grant-date fair value excluding the effect of non-market equity-settled stock-based payment arrangements granted to employees is generally recognized as an expense, with a corresponding increase in equity, over the vesting period of the awards. The amount recognized as an expense is adjusted to reflect the number of awards for which the related non-market performance conditions are expected to be met, such that the amount ultimately recognized is based on the number of awards that meet the related service and non-market performance conditions at the vesting date.

For awards that vest in tranches subject only to a service condition (e.g., time-based vesting), the Company recognizes compensation cost over the requisite service period for each separately-vesting tranche as though each tranche of the award is, in substance, a separate award.

2025 Stock Incentive Plan

Under the 2025 Stock Incentive Plan, eligible participants may be granted restricted share units ("RSUs"), which generally vest over a period of up to four years for employees and one to three years for agents, depending on the grant type. The expense in relation to RSUs earned in recognition of service performance conditions is recognized at grant-date fair value during the applicable vesting period with a corresponding increase in equity. Non-bonus RSUs granted under the agent stock purchase program are not subject to forfeiture and will be settled after a year from the date of grant. The expense in relation to such RSUs is recognized at grant-date fair value with a corresponding increase in equity. Please see Note 7.D for more information about the Company's RSUs.

The Company also awards performance-based RSUs which require certain conditions, communicated within each individual award, to be met for vesting to occur. Expense related to the issuance of performance-based RSUs is recorded over the vesting period, is initially based on the fair value of the award on the grant date and is subsequently adjusted at each reporting date based upon the probability that the performance target will be met. The Company accounts for forfeitures as they occur.

The Company accounts for income taxes under the asset and liability method pursuant to ASC 740, Income Taxes. Under this method, the Company recognizes deferred tax assets and liabilities for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recorded for deferred tax assets if it is more likely than not that some portion or all of the deferred tax assets will not be realized based on all available positive and negative evidence.

Tax benefits related to uncertain tax positions are recognized when it is more likely than not that a tax position will be sustained during an audit. Interest and penalties related to unrecognized tax benefits are included within the provision for income tax.

The Company provides loans to its agents with terms of up to three years. The balances reported in the consolidated balance sheets are at the outstanding principal amount less allowance for credit losses. The accrued interest receivables are also included in financing receivables as of the balance sheet date. In estimating the amount of the allowance for credit losses, the Company considers a combination of historical loss data, agent-specific information, current market conditions and reasonable and supportable forecasts of future economic conditions to inform adjustments to historical loss data. Both the allowance for credit losses and the interest income related to financing receivables were immaterial for the years ended December 31, 2025 and December 31, 2024.

The Company's investments in equity securities include securities without readily determinable fair values. For investments without readily determinable fair values, the Company has elected to use the measurement alternative, under which the investment is measured at its cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. This election is reassessed each reporting period to determine whether non-marketable equity investments have a readily determinable fair value, in which case they would no longer be eligible for this election. Indicators of impairment may include negative changes in the industry, unfavorable market conditions, weak financial

performance, or other relevant events and factors. No impairment was recorded in the consolidated statements of comprehensive loss for the years ended December 31, 2025 and 2024.

Recognition and measurement

Items of property and equipment are measured at cost less accumulated depreciation and any accumulated impairment losses. If significant parts of an item of property and equipment have different useful lives, then they are accounted for as separate items (significant components) of property and equipment.

Any gain or loss on disposal of an item of property and equipment is recognized in profit or loss.

Depreciation

Depreciation is calculated to write off the cost of items of property and equipment less their estimated residual values using the straight-line method over their estimated useful lives and is recognized in profit or loss.

The estimated useful lives of property and equipment for current and comparative periods are as follows: Computer hardware and software: 5 years

Furniture and fixtures: 5-10 years

Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted, if appropriate.

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 Note 2P below.

Software development costs include costs to develop software to be used solely to meet internal needs and applications used to deliver our services. These software development costs meet the criteria for capitalization once the preliminary project stage is complete and it is probable that the project will be completed and the software will be used to perform the function intended. Capitalized amounts are presented under property and equipment. And were immaterial for the years ended December 31, 2025 and 2024.

Debt securities that the Company doesn't have the intent and ability to hold to maturity and aren't held principally for the purpose of selling them in the near term are classified as available-for-sale. Debt securities classified as available-for-sale are reported at fair value and subject to impairment testing. Other than impairment losses, unrealized gains and losses are reported, net of the related tax effect, in other comprehensive income. Upon sale, realized gains and losses are reported in net income. No impairment was recorded in the consolidated statements of comprehensive loss for the years ended December 31, 2025 and 2024.

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:

Inputs are quoted market prices in active markets for identical assets or liabilities (these are

observable market inputs).

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).

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).

Refer to Note 14 for further information regarding the Company's fair value measurements.

In the consolidated balance sheets, cash and bank balances comprise cash (i.e. cash on hand and demand deposits) and cash equivalents. Cash equivalents consist primarily of money market funds and other short-term (generally with original maturity of three months or less), highly liquid investments that are readily convertible to a known amount of cash and which are subject to an insignificant risk of changes in value. Cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes.

Bank balances for which use by the Company is subject to third party contractual restrictions are included in Restricted cash in the consolidated balance sheets. Restricted cash consists of cash 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. Once the cash is transferred 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 consolidated balance sheet that sum to the total of the same amounts shown on the statement of cash flows.

Cash and cash equivalents

33,213

$ 23,376

Restricted cash

26,338

24,089

Total cash, cash equivalents, and restricted cash, ending balance

59,551

$ 47,465

Goodwill represents the excess of the consideration paid over the estimated fair value of assets acquired and liabilities assumed in a business combination. The Company evaluates goodwill for impairment on an annual basis in the fiscal fourth quarter or on an interim basis if an event occurs or circumstances change that would more likely than not indicate that the fair value of the reporting unit is less than its carrying amount. Generally, this evaluation begins with a qualitative assessment to determine if the fair value of the reporting unit is more likely than not less than its carrying value. If, after assessing these qualitative factors the Company concludes that it is not more likely than not that the fair value of our reporting unit is less than its carrying amount, then the quantitative goodwill impairment test is not necessary. However, if the qualitative factors indicate it is more likely than not that the fair value of our reporting unit is less than its carrying amount, or if the Company elects to skip the qualitative assessment, the Company would perform a quantitative impairment test. The test for impairment requires management to make judgments relating to future cash flows, discount and growth rates and economic and market conditions.

For the years ended December 31, 2025 and 2024, no impairment charges were recorded.

The Company's intangible assets are finite lived and consist primarily of customer relationships and purchased technologies. Determining the fair value of the intangible assets acquired requires management's judgment, often utilizes third-party valuation specialists, and involves the use of significant estimates and assumptions with respect to the timing and amounts of future cash flows, discount rates, replacement costs, and asset lives, among other estimates.

The judgments made in the determination of the estimated fair value assigned to the intangible assets acquired and the estimated useful life of each asset could significantly impact our consolidated financial statements in periods after the acquisition, such as through depreciation and amortization expense.

The Company evaluates its intangible assets for recoverability and potential impairment, or as events or changes in circumstances indicate the carrying value may be impaired.

The Company's intangible assets are finite lived and consist primarily of customer relationships and purchased technologies which are amortized on a straight-line basis over its useful life of 5 years.

The Company periodically evaluates the carrying value of long-lived assets to be held and used when events and circumstances warrant such a review. The carrying value of a long-lived asset is considered impaired when the anticipated undiscounted cash flow from such asset is less than its carrying value. When assets are considered impaired, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long-lived asset. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved.

At the inception of a contract, the Company assesses whether the contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The Company recognizes a right-of-use asset and a lease liability at the lease commencement date. The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset or the site on which it is located, less any lease incentives received.

The right-of-use asset is subsequently depreciated over the lease term. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements (i.e. changes in lease term) of the lease liability.

The lease liability is initially measured at the present value of lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the Company's incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate.

The Company applies the short-term lease recognition exemption to leases that have a lease term of 12 months or less from the commencement date. Lease payments on short-term leases are recognized as expenses on a straight-line basis over the lease term.

As of December 31, 2025 and December 31, 2024, the Company has no outstanding long-term operating or finance lease arrangements for which a right of use asset or lease liability were recognized.

The Company allocates the purchase price of an acquired company, including when applicable, the fair value of contingent consideration between tangible and intangible assets acquired and liabilities assumed from the acquired businesses based on estimated fair values, with any residual of the purchase price recorded as goodwill.

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.

The Company has a revenue sharing plan where its agents can receive additional income from real estate transactions consummated by agents they have attracted to the Company. The amount paid to agents under the revenue sharing plan is based on (1) the number of qualifying agents attracted to the Company and (2) the amount earned by the Company from real estate transactions consummated by such agents. Brokers are eligible to earn up to 1% of the revenue share that is generated by transactions closed in their states. Revenue share expenses are included as part of marketing expenses in the consolidated statements of comprehensive loss.

The Company classifies a warrant to purchase shares of its common stock as a liability on its consolidated balance sheets when either:

the warrant is a freestanding financial instrument which is either mandatorily redeemable, may require the repurchase of the Company's shares, or the Company has an obligation to issue a variable number of shares which monetary value is based solely or predominately on any one of the following:

a fixed monetary amount known at inception.

variations in something other than fair value of the shares.

variations inversely related to changes in fair value of the shares.

the warrant is a freestanding financial instrument that isn't indexed to the company's own stock or doesn't meet the criteria for equity classification per the guidance within ASC 815-40.

Each liability classified warrant is initially recorded at fair value on the grant date using the Black-Scholes model and net of issuance costs, and it is subsequently re-measured to fair value at each subsequent balance sheet date. Changes in fair value of the warrant are recognized as a component of other income (expense), net in the consolidated statements of comprehensive loss. As of December 31, 2025 and December 31, 2024 the Company had no warrants outstanding.

Company shares held by the Company are recognized at the cost of purchase and presented as a deduction from equity. Any gain or loss arising from a purchase, sale, issuance or cancellation of treasury shares is recognized directly in equity.

Advertising costs are expensed as incurred. Advertising costs are included in marketing expenses in the accompanying consolidated statements of comprehensive loss.

Advertising costs for the years ended December 31, 2025, and 2024 were $4.4 million and $3.5 million respectively.

The Company is subject to various legal proceedings and claims that arise in the ordinary course of business, some of which involve claims for damages that are substantial in amount. The Company is also from time to time subject to legal proceedings outside the ordinary course. Some of these matters may be covered by insurance, which contain deductibles, exclusions, claim limits and aggregate policy limits. While the ultimate liability for these legal proceedings cannot be determined, the Company uses judgment in the evaluation of claims and the need for accrual for loss contingencies quarterly. The Company records an accrual for litigation related losses where the likelihood of loss is both probable and estimable. The Company records legal fees for litigation as the legal services are provided.

Recently Adopted Accounting Pronouncement

The FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures ("ASU 2023-09"), to require disaggregated information about a reporting entity's effective tax rate reconciliation, as well as information on income taxes paid. The new requirements should be applied on a prospective basis, with an option to apply them retrospectively. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The Company has adopted ASU 2023-09 for the year ended December 31, 2025 using the prospective method.

New Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses ("DISE" or "ASU 2024-03") which requires enhanced disclosure of the nature of expenses included in the income statement. The new standard requires disclosures about specific types of expenses included in the functional expense captions presented on the face of the income statement as well as disclosures about selling expenses. DISE will be effective for annual reporting periods beginning after December 15, 2026, with early adoption permitted. The Company is currently evaluating the impact ASU 2024-03 will have on its consolidated financial statements and related disclosures.

In July 2025, FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets ("ASU 2025-05"), which introduces an optional practical expedient for all entities in developing reasonable and supportable forecasts when estimating expected credit losses. ASU 2025-05 is effective for annual periods beginning after December 15, 2025, with early adoption permitted. The Company is currently evaluating the impact ASU 2025-05 will have on its consolidated financial statements and related disclosures.

In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40) ("ASU 2025-06"), which amends the requirements for the capitalization of internal-use software. ASU 2025-06 is effective for annual periods beginning after December 15, 2027. The Company is currently evaluating the impact ASU 2025-06 will have on its consolidated financial statements and related disclosures.

In the following table, revenue (in thousands) from contracts with customers is disaggregated by major service lines.

2025

2024

Main revenue streams

Commissions

$ 1,956,483

$ 1,255,799

Title

5,035

4,788

Mortgage Broker Income

6,009

4,010

Wallet

889

Total Revenue

$ 1,968,416

$ 1,264,639

The following table presents cost of sales and a breakdown of operating expenses (in thousands):

2025

2024

Cost of Sales

$ 1,802,728

$ 1,149,898

Operating Expenses

General and Administrative Expenses

74,359

61,084

Salaries and Benefits

38,903

27,081

Stock-Based Compensation for Employees

8,416

9,324

Administrative Expenses

3,155

3,816

Professional Fees

18,337

16,437

Depreciation and Amortization Expense

1,929

1,396

Other

3,619

3,030

Marketing Expenses

82,383

57,477

Salaries and Benefits

1,686

1,048

Stock-Based Compensation for Employees

160

Stock-Based Compensation for Agents

14,727

10,077

Revenue Share

60,520

42,727

Other

5,290

3,596

Research and Development Expenses

17,443

12,156

Salaries and Benefits

10,321

6,400

Stock-Based Compensation for Employees

1,158

949

Software, Cloud G Tools

5,793

3,219

Other

171

1,588

Settlement of Litigation

750

9,250

Total Operating Expenses

$ 174,935

$ 139,967

Total Cost of Sales and Operating Expenses

$ 1,977,663

$ 1,289,865

The Company identifies an operating segment as a component of the business that (i) engages in business activities from which it may earn revenues and incur expenses, (ii) has discrete financial information available, and (iii) is regularly reviewed by the Company's Chief Operating Decision Maker to assess performance and allocate resources.

Segment information is prepared on the same basis used by the CODM, who is the Company's Chief Executive Officer, to manage the business and make decisions regarding allocating resources performance evaluation. Based on this assessment, the Company has identified the following operating segments:

Once operating segments are identified, the Company evaluates each segment using both quantitative and qualitative analysis, including current and historical revenue and profitability for each operating segment, to determine whether the segments have similar operating characteristics and whether they meet the criteria for separate disclosure under ASC 280.

Based on this evaluation, the Company has determined that it operates as three reportable segments - North American Brokerage, One Real Title and One Real Mortgage, each of which meets the quantitative thresholds for separate disclosure under ASC 280-10-50-12 and which collectively comprise more than 90% of the Company's total revenue and income (loss) from operations. Real Wallet does not meet any of the quantitative thresholds for separate disclosure under ASC 280 and is therefore included within "Other Segments". Prior period segment information has been recast to reflect the change in the number of reportable segments and allocate revenue, cost of sales and operating expenses between the various segments.

The CODM evaluates segment performance using revenue, gross profit and operating income (loss). These metrics are used to assess performance, identify trends affecting the segments, develop forecasts and make strategic operating decisions. All segments follow the same basis of presentation and accounting policies as those described throughout the notes to the consolidated financial statements and as included herein.

Brofierage One Real Title Mortgage Segments

Total

Revenues

$ 1,956,483 $ 5,035 $ 6,009 $ 889

$ 1,968,416

Cost of sales

1,798,494 890 3,140 204

1,802,728

Gross Profit

$ 157,989 $ 4,145 $ 2,869 $ 685

$ 165,688

Operating Expenses(1)(2)

160,294 8,266 5,031 1,344

174,935

Operating Loss

$ (2,305) $ (4,121) $ (2,162) $ (659)

$ (9,247)

Reconciliation of loss (segment

Other income, net

995

Finance expense, net

(554)

Loss Before Tax

$ (8,806)

1Operating expenses includes General

and administrative expenses, Marketing expenses, Research and

development, and

loss)

settlement of litigation expenses.

2Operating expenses includes Revenue share expense of approximately $60,520 thousand and is recorded in the North American Brokerage segment.

Brofierage

One Real Title

Mortgage

Segments

Total

Revenues

$ 1,255,799

$ 4,788

$ 4,010

$ 1,264,639

Cost of sales

1,147,072

671

2,155

1,149,898

Gross Profit

$ 108,727

$ 4,117

$ 1,855

$ 114,741

Operating Expenses(1)(2)

128,953

6,814

3,774

426

139,967

Operating Loss

$ (20,226)

$ (2,697)

$ (1,919)

$ (384)

$ (25,226)

Reconciliation of loss (segment

Other income, net

496

Finance expenses, net

(1,723)

Loss Before Tax

$ (26,453)

loss)

1Operating expenses includes General and administrative expenses, Marketing expenses, Research and development, and settlement of litigation expenses.

2Operating expenses includes Revenue share expense of approximately $42,727 thousand and is recorded in the North American Brokerage segment.

Segment revenue reported above represents revenue generated from external customers. There were no intersegment sales in the current and in the prior year.

Segment assets and liabilities are not regularly provided to the Chief Operating Decision Maker and, accordingly, are not disclosed.

2025

2024

North American Brokerage

1,150

609

One Real Title

673

676

One Real Mortgage

106

111

Other Segments

Total

1,929

1,396

The amount of revenue from external customers, by geography, is shown in the table below (in thousands):

2025

2024

United States

$ 1,748,894

$ 1,109,616

Canada

219,522

155,023

Total revenue by region

$ 1,968,416

$ 1,264,639

Non-current assets, by geography, are shown in the tables below (in thousands):

Canada

Israel

India

United States

Total

Non-Current Assets

Intangible Assets

$ -

$ 4,157

Goodwill

8,993

Property and Equipment

208

2,227

2,455

Total

$ 10

$ 208

$ 15,377

$ 15,605

Canada

Israel

United States

Total

Non-Current Assets

Intangible Assets

$ 2,575

Goodwill

8,993

Property and Equipment

2,089

2,116

Total

$ 13,657

$ 13,684

Basic loss per share is computed by dividing net loss attributable to common shareholders for the period by the weighted average number of common shares outstanding ("Common Shares") outstanding during the period.

Diluted loss per share is calculated by dividing net loss attributable to common shareholders by the weighted average number of Common Shares outstanding, adjusted for the effect of potentially dilutive securities. For the periods presented, the Company incurred a net loss; accordingly, all potentially dilutive securities were anti-dilutive and have been excluded from the calculation of diluted loss per share. As a result, basic and diluted loss per share are the same.

For periods with net income, the Company applies the treasury stock method to calculate the potential dilutive effect of unvested RSUs and unexercised stock options in periods in which the Company reports net income. The Company does not pay dividends or have participating securities outstanding.

The following table outlines the number of Common Shares (in thousands) and basic and diluted loss per share.

Twelve Months Ended December 31,

2025

2024

Weighted-average number of Common Shares - basic and diluted

219,873

191,172

Loss per share

Basic and diluted loss per share

$ (0.04)

$ (0.14)

The following potential ordinary shares (in thousands) are anti-dilutive and are therefore excluded from the weighted average number of common shares for the purpose of diluted earnings per share.

Twelve Months Ended December 31,

2025

2024

Options

10,704

14,991

RSU

17,515

24,619

Total

28,219

39,610

Stock option plan (equity-settled)

The Company maintains equity-settled stock-based compensation plans under which stock options, restricted stock units, and other stock-based awards may be granted to directors, officers, employees, agents, and other service providers, including independent contractors, of the Company.

On January 20, 2016, the Company established a stock option plan (the "Stocfi Option Plan") that entitles key management personnel and employees to purchase shares in the Company. Under the Stock Option Plan, holders of vested Options are entitled to purchase Common Shares for the exercise price as determined at the grant date.

On February 26, 2022, the Company established an omnibus incentive plan (the "Omnibus Incentive Plan"), which was approved by shareholders on June 13, 2022. The Omnibus Incentive Plan provides for the issuance of RSUs and stock options, subject to an overall limit of up to 20% of the issued and outstanding Common Shares as of the applicable award date thereof (being 35.6 million Common Shares, less RSUs and Options outstanding under other equity incentive plans).

On July 13, 2022, the Company adopted an amended and restated omnibus incentive plan (the "AGR Plan"), which was approved by shareholders on June 9, 2023. Under the AGR Plan, the maximum number of Common Shares issuable pursuant to outstanding options at any time was limited to 15% of the aggregate number of issued and outstanding Common Shares as of the applicable award date less the number of Common Shares issuable pursuant to Options under the AGR Plan or any other security-based compensation arrangement of the Company. The AGR Plan also authorized the issuance of up to 70,000,000 RSUs. The RSU limit is separate and distinct from the maximum number of Common Shares reserved for issuance pursuant to Options under the AGR Plan. Since June 1, 2025, no further awards may be granted under the Stock Option Plan, Omnibus Incentive Plan, or AGR Plan; however, these security-based incentive compensation plans continue to govern the previously issued securities under such plans.

On April 14, 2025, the Company adopted the 2025 Stock Incentive Plan (the "2025 Plan"), which was approved by shareholders on May 30, 2025. The 2025 Plan authorizes the issuance of up to 50,000,000 Common Shares for stock-based compensation awards, and other stock-based awards. As of December 31, 2025, 38,419,871 shares remain available for issuance under the 2025 plan.

The fair value of the Options has been measured using the Black-Scholes option pricing model. The Black-Scholes model requires management to make certain assumptions, including the expected life of the stock options, expected volatility, and risk-free interest rate. Service and non-market performance conditions attached to the awards are not considered in measuring fair value. The assumptions used to estimate the fair value of stock options granted during the years ended December 31, 2025 and December 31, 2024, were as follows:

As of

December 31, 2025

December 31, 2024

Share price

$4.50 to $5.10

$4.31 to $6.50

Expected volatility (weighted-average)

46% to 60%

69.4% - 95%

Expected life (weighted-average)

2.46 to 3.91 years

3.9 to 10 years

Expected dividends

- %

Risk-free interest rate (based on US government bonds)

4.39 - 4.45%

4.19 - 4.26%

Weighted-average grant date fair value

$4.73

$5.28

Expected volatility has been based on an evaluation of historical volatility of the Company's share price.

The following table outlines the number of Options (in thousands) and weighted-average exercise price:

Outstanding at beginning of year

14,991 $

1.09

21,943 $

0.92

Granted

4.73

100

5.28

Forfeited/ Expired

(43)

0.71

(88)

1.3

Exercised

(4,284)

0.54

(6,964)

0.6

Outstanding at end of period

10,704 $

1.32

14,991 $

1.09

Exercisable at end of period

8,976 $

1.26

11,702 $

0.96

The Options outstanding as of December 31, 2025 had a weighted average exercise price of $1.32 (December 31, 2024: $1.09) and a weighted-average remaining contractual life of 6.0 years (December 31, 2024: 6.6 years).

The fair value of stock options vested, and the intrinsic value of stock options exercised are as follows:

For the Year Ended

Fair value of options vested

1.51 $

1.38

Intrinsic value of options exercised

4.14 $

4.11

The Company grants restricted share units to agents, employees, and other service providers under its stock-based payment arrangements. Each RSU entitles the holder to receive one Common Share upon vesting and may be settled in Common Shares or, at the Company's discretion, in cash. RSUs are historically and expected to be equity-settled and therefore classified as equity awards.

RSUs are subject to service-based vesting conditions and, in certain cases, performance-based vesting conditions. Stock-based compensation expense for RSUs is recognized over the applicable vesting period based on the grant-date fair value of the award and the estimated number of RSUs expected to vest, with a corresponding increase to additional paid-in capital. RSUs that do not vest are forfeited.

Agent RSUs

The Company grants RSUs to agents through multiple stock-based payment arrangements that are designed to support agent retention, production, and engagement. Agent RSUs are subject to service-based vesting conditions and are forfeited if the applicable vesting conditions are not satisfied. The Company recognizes expense from the issuance of these RSUs during the applicable vesting period based on the grant-date fair value of the award and the estimated number of RSUs expected to vest, with a corresponding increase in additional paid-in capital.

Agent Purchase Program RSUs

Under the Company's agent stock purchase program, ("Agent Purchase Program"), agents may acquire RSUs using a portion of their commissions that is withheld by the Company. RSUs acquired under this program are not subject to forfeiture and are settled after a year from the date of grant. Stock-based compensation expense related to

these RSUs is recognized in the period in which the RSUs are granted and is classified within cost of sales, with a corresponding increase to equity.

Bonus RSUs Related to the Agent Purchase Program RSUs

As an incentive to participate in the Agent Purchase Program and remain with the Company following the purchase, the Company grants incentive-based RSUs ("Bonus RSUs"). Bonus RSUs vest one year from the grant date and are subject to forfeiture if the applicable service conditions are not satisfied. The number of Bonus RSUs granted is determined as a percentage of commissions withheld under the Agent Purchase Program, with the applicable percentage dependent on whether the agent has reached their contractual commission cap. Stock-based compensation expense related to Bonus RSUs is recognized over the vesting period and is classified within marketing expense.

Production- and Service-Based Agent RSUs

The Company also grants RSUs to agents in connection with achieving specified production milestones, attracting and retaining productive agents, and making defined contributions to the Company's agent community. These awards include, among others, production-based Elite awards, capping awards, attracting awards, and cultural or service-based awards. Such RSUs generally vest over a period of up to three years and are subject to forfeiture if vesting conditions are not met. Stock-based compensation expense related to these awards is recognized over the vesting period and is classified within marketing expense.

Employee RSUs

RSUs granted to full-time employees ("FTEs") are generally subject to service-based vesting conditions and typically vest over a four-year period. Stock-based compensation expense related to employee RSUs is recognized over the vesting period and is classified within general and administrative, research and development, or marketing expense based on the employee's functional department.

Performance-Based RSUs

The Company also grants performance-based RSUs that vest upon the achievement of specified performance conditions. Stock-based compensation expense for performance-based RSUs is recognized over the vesting period based on the grant date fair value of the award and the number of awards expected to vest, which is reassessed at each reporting period based on the probability that the performance conditions will be achieved. If it is determined that the performance conditions will not be met, previously recognized compensation expense is reversed. As of December 31, 2025, there are no performance-based RSUs outstanding.

Grants

During the year ended December 31, 2025, the Company granted RSU awards relating to approximately 20.0 million Common Shares with a weighted average grant date fair value of $4.28 per share. During the year ended December 31, 2024, the Company granted RSUs relating to approximately 17.8 million, with a weighted average grant date fair value of $4.26 per share.

RSU Activity

The following table illustrates the Company's stock activity (in thousands of units) for the RSUs under its equity plan. Once fully vested, awards are either settled in stock or the equivalent cash value, as determined at the

Company's discretion. RSUs are historically and expected to be equity-settled and therefore are classified as equity awards.

Restricted Share

Units

Balance at, December 31, 2023

27,609

Granted

17,769

Vested and Issued

(19,376)

Forfeited

(1,383)

Balance at, December 31, 2024

24,619

Granted

20,022

Vested and Issued

(13,110)

Forfeited

(4,139)

Balance at, December 31, 2025

27,392

The following table provides a detailed breakdown of the stock-based compensation expense (in thousands) as reported in the consolidated statement of loss.

Total

Options Expense

RSU

Expense

Options Expense

RSU

Expense

Total

Cost of Sales - Agent Stock-Based Compensation

- $ 43,685 $ 43,685 $

- $ 32,537 $ 32,537

Marketing Expenses - Agent

Stock-Based Compensation 233 14,494 14,727 382 9,695 10,077

Marketing Expenses - FTE Stock-Based Compensation

160

Research and Development -

General and Administrative -FTE Stock-Based Compensation

783

7,633

1,763

7,561

FTE Stock-Based Compensation 3 1,155 1,158 24 925 949

Disclaimer

The Real Brokerage Inc. published this content on April 24, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on April 24, 2026 at 14:53 UTC.