Segment Reporting

6 Months Ended

Jun. 30, 2023

Segment Reporting

Segment Reporting

Note 17. Segment Reporting

The Company identifies an operating segment as a component: (i) that engages in business activities from which it may earn revenues and incur expenses; (ii) that has available discrete financial information; and (iii) whose operating results are regularly reviewed by the Chief Operating Decision Maker (“CODM”) to allocate resources and to assess the operating results and financial performance of each operating segment.

Our Chief Operating Decision Maker makes operating decisions and assesses performance based on the services of identified operating segments and has identified three reportable segments: Real Estate Brokerage; Mortgage; and Technology. Through its Real Estate Brokerage segment, the Company provides real estate brokerage services. Through its Mortgage segment, the Company provides residential loan origination and underwriting services. Through its Technology segment, the Company provides SaaS solutions and data mining for third party customers and continues to develop its intelliAgent platform for current use by the Company’s real estate agents.

Revenue and Adjusted EBITDA are the primary measures used by the CODM to evaluate financial performance of the reportable segments and to allocate resources. Adjusted EBITDA represents the revenues of the operating segment less operating expenses directly attributable to the respective operating segment. Adjusted EBITDA is defined by us as net income (loss), excluding other income and expense, costs related to acquisitions, income taxes, depreciation and amortization, and stock-based compensation expense. In particular, the Company believes the exclusion of non-cash stock-based compensation expense related to restricted stock awards and stock options and transaction-related costs provides a useful supplemental measure in evaluating the performance of our operations and provides better transparency into our results of operations. The Company’s presentation of Adjusted EBITDA might not be comparable to similar measures used by other companies.

The Company does not allocate assets to its reportable segments as they are not included in the review performed by the CODM for purposes of assessing segment performance and allocating resources. The balance sheet is managed on a consolidated basis and is not used in the context of segment reporting.

Key operating data for the reportable segments for the three and six months ended June 30, 2023 and 2022 are set forth in the tables below (amounts in thousands):

		Revenue
		Three Months Ended			Six Months Ended
		June 30,			June 30,
	2023		2022		2023		2022
Real Estate Brokerage	$	94,633	$	122,053	$	167,803	$	206,097
Mortgage		2,019		2,642		3,483		5,506
Technology		792		656		1,549		1,301
Corporate and other services (a)		2,645		2,828		4,795		5,357
Total revenue	$	100,089	$	128,179	$	177,630	$	218,261

	Adjusted EBITDA
	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2023		2022		2023		2022
Real Estate Brokerage	$	2,570	$	1,755	$	3,868	$	2,709
Mortgage		(237)		(860)		(804)		(1,350)
Technology		(418)		(325)		(630)		(693)
Total Segment Adjusted EBITDA		1,915		570		2,434		666
Corporate and other services (a)		(1,457)		(2,554)		(3,345)		(4,763)
Total Company Adjusted EBITDA		458		(1,984)		(911)		(4,097)
Depreciation and amortization		1,510		1,343		2,867		2,405
Other expense (income), net		83		234		226		571
Income tax expense		25		160		37		185
Stock based compensation		3,185		1,941		6,005		4,348
Transaction-related costs		—		7		—		60
Net loss	$	(4,345)	$	(5,669)	$	(10,046)	$	(11,666)

(a) Transactions between segments are eliminated in consolidation. Such amounts are eliminated through the Corporate and other services line.