Following our prepared remarks, we will open the call to a Q and A session with our speakers. Let's begin with a review of the forward looking statements. There'll be a number of forward looking statements made today that should be considered in conjunction with the cautionary statements contained in the company's SEC filings. Forward looking statements are subject to various risks and uncertainties that could cause our actual results to differ materially from these statements, please see our filings with the SEC, including our most recently filed annual report on form 10k and quarterly reports on Form 10 Q, for a discussion of specific risks that may affect our business performance and financial condition, we assume no obligation to update or revise any forward looking statements or information. As a reminder, today's call is being recorded, and a replay will also be made available on exp worldholdings.com
now for a few logistics, and we'll get started
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All right, thanks, Denise and thanks everyone for joining us today. It was a busy q3 as as you guys are aware, obviously, we just came off of our big event in Miami, exp, con, 2024, I know there were some investors and some analysts that were attending, it was pretty cool to get some notes even in the background from the event. I think one of our analysts actually sent me a note about our our fun dance. So you want to see something viral, go check that out anyway. You know this this quarter. You know, want to just continue to refocus us on what we're working on. Obviously, we've got EXP North America, and Leo is going to really talk about things that are going on. And Wendy as well on on exp North America are on international. That's where I've been focusing a ton of my time since July, and we've really turned things around in a major way. Obviously, we also have success enterprises. And then, of course, where you're actually seeing right now, which is frame, vr.io, which is truly our digital workplace. Fact, I'm going to invite those of you who are interested to come by our international offices at some point at exp dot world slash International. So just keep that in the back of your mind, but you can come in see how we operate, see how we work. We're working, you know, 24/7 around the globe. But we've really just built this amazing platform where agents are our singular focus. You know, we've spent more than 15 years building out the EXP platform. We just went past our 15 year anniversary at the beginning of October. And you know, we are, we are doing some amazing things. You know, obviously we think about things like our NPS, and, you know, we've got, you know, phenomenal scores on that. You know, we like to think about the idea that if we're above a 70 on our agent NPS, we're in good shape. And we're in great shape right now. We actually increased to 76 but that's going to fluctuate up and down. So the fact that it's above 70 is an amazing number, because we know that if we're above 70, we're really attracting agents in we're growing our market share and and really we think about what we're here to do. We're really here to build the most agent centric real estate brokerage on the planet. Again, Leo will touch on North America. But we did, you know, purchase a few things. We did a few things, you know, lux V teeth. Again, Leo will touch on that, and Wendy as well. But we're also doing a lot of stuff with with AI, with Seth sieglin, we'll, we'll talk about that. So a lot of really, really great stuff International. You know, as I mentioned, that's really where, where I'm focused in July, you know, I, I jumped in with the international team. We have an amazing team on the international side of the business, and we've now grown, you know, our revenue. Just in the last 12 months, we've grown it by 63% and and I mentioned that, and that's a that's a lightning indicator, but it really speaks to the fact that we've got quality agents in the international domain, and we're focusing quite a bit on what we need to do to grow that. In the prior 12 to 18 months, prior to jumping in, we hadn't opened up a single country. We now have three countries that we're going to be opening up in early 2025 we've made great progress on Turkey, Peru and now Egypt, and we've got just an amazing team there working on helping us grow out. You'll see this home Hunter dot global, one of the things that we've learned over the last number of years, and especially, you know, getting involved. I remember Leo and I, we flew over for exp, con International, and we sat with some of the portals that that basically control the real estate industry outside of North America. In North America, we have the benefit of the multiple listing services all basically keeping the portals in check, meaning that no single portal has a has a dominant market share of listings, and certainly there are as money to be made in the portal space. You can certainly look at the market cap of Zillow and realtor.com and how important these are homes.com as well in businesses of agents. However, internationally the portals, there is no MLS to basically keep them in check, you have to actually go and search multiple real estate portals as a consumer. And so one of the things that we're really excited about is a partnership with a platform called home Hunter dot global, and you can go check it out. But if you're searching for property outside of North America, especially in the markets that exp is doing business in, you're going to want to go into the Chrome App Store and the browser extension Store and download the home Hunter dot global extension. The reason being is, if you've ever searched internationally, one you don't know all the websites that the listing that you're looking for might be on, so you need a tool to keep track of all the different websites. And then on top of that, you need to be able to keep track of the listings that you've actually seen on the various different websites. And home Hunter dot global is actually the first tool of its kind that I'm aware of where you as a consumer can keep track of all of that important information, but it also will connect you with an exp agent and also help promote exp listings to those individuals who actually use the home Hunter global extension. So it's a great consumer tool. It's a great agent engagement tool. And again, excited about a lot of things that we're doing. We do have more countries in the wings. We're in active conversations with two to three countries that we are excited about announcing, very shortly, hopefully before the end of the year, we'll have at least one, if not more, countries that we'll be announcing. But there's a lot of good stuff going on on the on the international front and so that with that, let me go ahead and turn it over to Leo, and he can walk you through some of the highlights of North America. Leo,
Thanks Glenn, and thanks to everyone who's joining us today. I'm really thrilled with the number of quality, independent brokers and teams we've brought on during this last quarter. This is success is a direct result of a lot of the strategic growth that we've been focusing on at exp. We're very effectively aligned with our growth team and our marketing efforts to attract some of the most respected and highest performing teams in the industry. These additions are not just a testament to our strategy, but also are significantly strengthening our exp market position. Earlier this year, I spoke about key initiatives that are driving this launch, this growth. We talked about booth thrive, revenue share 2.0 and I'm happy to say these programs are making a notable impact. On July 1, we launched Fast Start attraction bonus, and I'm proud to announce that in q3 alone, we paid over 5 million to agents who are part of this initiative. We also announced more incentives at exp Con last week to further support our icons and our productive agents. The icon incentive program and revenue share capping incentive program are as follows. The icon incentive program will credit icon agents up to 30 front line qualifying agents for 13 months, maximizing the revenue share potential for all seven levels, and the revenue share capping Incentive Program provides an additional revenue stream for ages that have capped by crediting them with 10, FL, two a to maximize their earnings Potentials through levels five to 13 months, both of those programs will start or start in November, 1 on the first quarter call, I mentioned that I promised conversations we're having with small to mid size, independent anticipated influx of new groups joining exp with dozens or even hundreds of agents at a time. I'm pleased to report that we delivered on those promises. During the third quarter, we welcomed several independent brokerages with contributing hundreds of agents and represented hundreds of millions of volume at the same time, these brokerages include award winning teams that have recognized that are recognized powerhouses in their regions to further elevate our pro class, Brandon brittenham and the Maryland Delaware group sold 900 homes last year and are on their joined our company last quarter. Chantel ray in canzo Realty, which was one of the original cloud based brokerage competitors we saw pop up about five years ago. License in over 20 states came over as an entire company, and Michael Levy, with the grand luxury team in New York, came over with just over 200 agents. That's really exciting for us. So we continue to see this momentum. And I can continue to say that there are many, many conversations like that still in process, coming over. So going into 25 we're really excited for the quality and production we continue to attract to the platform. With that, I'll pass it over to our CMO Wendy foresight, who will share some updates and exciting improvements in marketing and programs to enhance our agent value proposition and making exp so attractive to agents. Wendy, Thanks,
Leo and hello everyone. Thanks for joining us today. I joined exp a little over six months ago, having a background in real estate, I've watched exp grow and innovate, and I'm excited to be part of the team building this next chapter of this amazing company. I'll start with my first mandate, evolving the EXP brand. On the next slide, I'll walk you through the key focus areas of the EXP 2.0 brand strategy to further align exp image with its leadership position in innovation, technology and Agent empowerment. First, we focused on updating the brand esthetics towards a more modern look and feel, and we call this our brand blow up. We shifted away from the royal blue primary brand color to a dark navy, remove the outdated box logo treatment and aligned all supporting product and program logos for an overall brand consistency. Second, we focused on increasing brand awareness of the EXP brand. On the next slide, I'll walk you through some recent press coverage we secured as part of increasing awareness of EXP initiatives, as part of our brand evolution, we've made tremendous strides in boosting our thought leadership and increasing media visibility. I'm thrilled to share that we've appeared in over 7700 articles across major media outlets such as The Wall Street Journal CNBC and CNN, along with top industry publications like Housing Wire in the news and RIS media, these appearances have generated over 14 point 7 billion views and impressions, giving us an incredible Share of Voice in the industry. This level of exposure is a clear reflection on the growing recognition of EXP leadership and the EXP brand. Establishing a strong brand voice is key as we continue to enhance our value proposition and create even more opportunities for our agents. One exciting opportunity we've been focused on is empowering our agents to compete in the luxury market, which I'll discuss more in the next slide. We launched exp luxury just two years ago, and it's been very well received. We've expanded into all international markets during 2024 and compared to the third quarter 2023 we grew our agent membership by 94% the luxury division offers agents an elite suite of integrated solutions to maximize their earnings potential, sign and sell more high priced listing and not just grow but thrive in the luxury space. I'm delighted to announce that on October 18, exp Realty acquired Lux VT a marketing technology platform that helps agents promote their luxury listings. Our luxury agents have been using this platform to improve their marketing efficiency, build and provide successful strategies for client acquisition and management. Owning this suite of solutions built for the luxury space is an important strategic move that gives exp agents distinct competitive advantages, allowing our agents and the EXP brand to stand out in the luxury market. Moving on to the next slide, I'll wrap up by sharing some ground breaking announcements and exciting new initiatives we unveiled last week at exp con. This year's event was hosted for the first time in Miami, and brought together 4300 attendees. The energy was electric. During exp con, we made several major announcements, enhanced features to reg chair 2.0 that take agent collaboration and growth to the next level. A global partnership with Canva, the world's leading digital design platform, bringing powerful creative design tools to our agents. A partnership with sisu to supercharge agent and team productivity, the acquisition of Lex VT, which I just talked about, the launch of a fully designed and re imagined exp realty.com and exp realty.ca website expansion into three international countries that Glenn mentioned to further grow our global print footprint. And if that wasn't enough, we kicked off exp, first ever hackathon, an innovative event powered by open AI's cutting edge technology where talented participants tackled unique challenges facing exp Realty and a broader real estate industry. Now I'm going to hand it over to Seth Siegler, exp, Chief Innovation Officer, to dive into the exciting AI based innovations we're bringing to life set Awesome. Thanks
Wendy, and thanks everybody. Super excited to be here today to get into our latest tech and innovation. We're really pushing the boundaries and adopting AI based technology across the entire business, really trying to redefine what's possible in real estate tech, setting new standards for the industry itself. Here at exp, we've always been on a relentless journey of innovation, always using technology to really empower agents and transform the way that we do things in the business. And we're really focused on building a future where agents are equipped to be transformative in what they do, giving them the tools that they need to make that possible enable them, enabling them to thrive and succeed at unmatchable levels. That's always our goal. So part of this journey is our unwavering focus on leveraging today's most cutting edge AI solutions to really revolutionize the business in four key areas that we think hold the most opportunity for growth and opportunity. So those four areas are agent productivity, operational efficiency and accuracy, internal empowerment and agility. And lastly, future application. So to get into it, starting with agent productivity, our commitment to our agents means that we always need to be there for them whenever they need us. With AI now integrated into our existing expert care desk and the all new Luna 2.0 we've really created an always on support system that offers agents around the clock assistance and really empowers them with instant answers and support whenever they need it wherever they're located. Agents can also get real time info and interaction with their own business via natural language chat using Luna, which is using NLP AI to deeply integrate into several of our existing exp systems in terms of operational efficiency and accuracy, really leaning into the power of AI to create tools and workflows that augment, simplify, streamline and add a lot of scalability to everything that that we're doing, from document processing To transaction processing, software development Our in house task center, a project that we built here, is only accelerating these workflows, smartly, routing tasks, ensuring projects remain on task, and ultimately making operations smoother, more measurable and more effective. So in terms of internal empowerment and agility for the staff. It's not only about helping agents. AI can help us in all sorts of different areas. We're using it also to empower our whole team. Internally. We're enabling our staff to tackle challenges and manage tasks independently supported by AI driven augmentation and assistance in part, thanks to our ever deepening partnership with open AI, the leader in the space, hundreds of our staff members now have access to our enterprise OpenAI platform and have created custom GCT assistance that help them with their daily tasks, enabling them to work smarter, faster and more effectively than ever before, without having to write any code or wait on any solutions to be built for them, they can really take that into their own hands. And then lastly, future applications. So it's, you know, still early days for some of this technology, but we see incredible opportunity for the future, including innovation in education, mentoring as well as rapid prototyping of new ideas and software, and enables us to just move faster and more efficiently. Some of these initiatives are already actually in flight in the early stages, and I'm massively excited about the possibilities that they can bring to transform what we're doing here at EXP and revolutionize even the industry as a whole. So just as exp pioneered the industry as the first cloud based brokerage, we're we're taking a leading position in AI adoption as well. I couldn't be more pumped up to be here helping to drive this initiative forward and ride the wave of innovation it is shaping the way that all industries are are working. And, you know, real estate's no exception there. So we're just looking to continue to transform the way that we serve our agents, clients and our communities. So that brings us to something exciting as part of this commitment, we're launching an investor relations GPT feature on our IR website, so investors can get a small taste of how game changing this technology really is, and save some time of researching exp. Anyone interested in researching and learning more about exp can find the expert GPT feature on the bottom right hand side of each page across our IR website. Expert GPC will search exp filings, press releases, earnings calls, transcripts and IR related materials to find whatever the answer may be to your IR related question. So that's that, and now I'll turn the call over to Kent to walk you through exp third quarter financial highlights.
Thank you. Seth, on the next slide, I will highlight several key matches during the third quarter, 2024 to underscore our progress and strategic initiative, let's start with our agent, net promoter, score of AMTS this quarter, we achieve an AMTS of 76 which is a two point improvement compared to the third quarter of last year. This number continues to be strong as we continue to listen to our agents and invest in programs that drive their productivity through compensation, incentives, sales and marketing and technology, as the team discussed previously, moving on to our agent network, our agent can decrease focus them on a year over year base, reflecting both challenging market conditions in the US and our strategic decision to offer unproductive agents. This move is aligned with our focus on enhancing overall productivity and efficiency, turning to our other operating methods, real estate sales transaction unit decline 1% year over year, while real estate sales volume increase by 5% Realty cost per transaction decrease 1% as we focus on operating efficiency, while continuing to invest in our agent, we believe we are among The most efficient companies in our industry, and we remain focused on reducing our cost per transaction moving forward. Now, let's discuss our financial matches. Revenue for the third quarter was $1,231,000,000 a 2% increase year over year. Our Q free revenue growth was due to higher real estate sales volume and the increase in agent productivity, which I will detail in the next slide. Third quarter adjusting design, was $23.9 million up to 10% year over year, driven by higher revenue and low SG and a expenses relative to five year quarters, doing down into our two three expenses, general and administrative expenses were $61.4 million of 2% compared to a third quarter of 23 due to higher employee related expenses and increased legal costs related to the anti trust lawsuit, we provided an additional $18 million anti trust lawsuit settlement contingency provision in q3 if you recall, in q1 this year, we provided a 60 million provision for this matter. As of the end of q3 we have provided a total $34 million anti trust contingent provision which was consistent with the current settlement our gap net loss was $8.5 million driven by 18 million anti truck contingency provision, excluding this $18 million contingent distribution. Third quarter adjusted net income of $7.8 million compared to $2.3 million in 2023 of 239% increase year over year. Moving on to cash flow and capital allocation. Q, free adjusted Operating cash flow was $55 million we repurchase $35 million of share during the quarter. The number of share repurchase in q3 was more than after the number of share issue through our agent and employee stock compensation program. On the next slide, I will provide more detail about the driver of revenue increase for the third quarter. This chart shows the driver behind the increase in revenue from the third quarter of 2023 to the third quarter of 2024 in the q3 2023 our revenue stood at $1,230,000,000 as shown by the bar on the left. For the third quarter of 2024 revenue increased $80 million or 2% to $1,231,000,000 as indicated by the bar on the right, this increase were driven by both North America Realty seven, which including US and Canada and our international both contributed about $9 million in additional revenue during the quarter. Let's delve deeper into the North America Realty business. Market transition in the US led to a lower agent which negatively impact our impacted our revenue by approximately $75 million US home sales in third quarter 2024 declined 1.3% year over year, which pressure our agent production, we estimated the decrease in the North America Realty market reduce our revenue by about ten million however, this market decline will more than offset by gain from several areas in our business relative to the performance of the real estate market, An increase in our Asian productivity over prior year and $55 million of revenue higher home sales prices contributing incremental revenue of $32 million Additionally, our strategic focus on expanding our lead referral and other and service services brought in An $8 million hotline growth on the next slide, I will provide an overview of the financial statement. The North America Realty segment continues to be the primary driver of both revenue and profit for the company, despite the challenge us real estate market condition seven revenue was $1,207,000,000 a slight decrease from prior year due to higher home sales price and improved ESP agent was $28.9 million a 6% increase every year due to improved business efficiency. International new segment revenue was $24.2 million an increase of 63% primarily due to increased real estate transaction driven by by improved agent connectivity. Adjust. The EBITDA loss was $1.7 million 37% improvement from five years due to increased revenue and improve business efficiency. Other affiliated services, including frame and success, contributed modest revenue and adjusted with our loss. This slide highlight our solid tier three performance across the key operational and financial metrics, which I have discussed in detail in previous slides looking ahead to the fourth quarter, we continue to anticipate downward pressure on us the system wholesale, which is consistent with third quarter commentary, barring any significant macroeconomic shift. Our gross margin percentage for the fourth quarter is expected to be generally consistent with our typical seasonal pattern and the last year's performance. We plan to continue to investing in our international market and Asian growth initiative to boost productivity. I also noticed that full quarter is seasonally our slowest quarter in terms of real estate transaction, our exp expenses will increase sequentially from Q suite due to the annual USG con event expenses to be recorded in q4 In conclusion, I'm happy to report another quarter of solid expletion, which leaves us well positioned to capitalize the upcoming market growth activities When the real estate market churn and recover positive. We with that, say I like to turn the presentation back to Dean who will facilitate the Q and A session. Thank you. Great.
Thanks, Denise, and thanks everyone for joining us today. It was
great. All right. Kent, thank
you. I'll kick it off with a question for everyone on the team first, before we open up to the general audience for questions. First, Glen, can you? Can you talk about why you decided to expand into Turkey, Peru and Egypt in particular? Yeah. So
some of these were conversations that were going on. Peru specifically was one that had been going on for a while, and I think the team was really looking to open up some new countries. So obviously I jumped in in July. We've got a great partner in in Peru with Ricardo and and then we had opportunities to look at a couple other markets, Turkey shared on our social media, but diet is the gentleman opening up in Turkey, large social media following really strong real estate sales background really kind of epitomizes what we're looking for in a leader in in Turkey. And so pretty excited about, about him. And then with, with Ahmad in in Egypt, you know, very well connected build it, building the MLS in Egypt with a strong background and organized real estate, and is really enthusiastic about opening it up. So we're really building around strong leaders. And so these were the three individuals who represented really the best of the best in these markets. We've always say that we really focus on following leadership rather than focusing on the market. I think previously, we may have taken approach which was, let's open up markets because they're good markets. Historically, in West Canada, we opened up different states because we had good leaders. And so we're going back to sort of that approach, and we've got a lot of other great conversations going on as well. So as we meet great leaders, and they can put together the core groups, and we can help them sort of dial in the value propositions that make sense. We are simplifying the opening up of new markets, so we're going to really to two different cap system for international so that'll also play into sort of rapid, our rapid growth model, and we're doing some standardizations around that, which, again, will play out well. We just announced last week, which is probably worth noting, our international sponsorship program, where agents internationally can assist agents anywhere in the world to recruit in their country in that they're not in their rev share groups. So pretty excited about that. So anyway, just a lot of things that we're doing on the international front that is pretty, pretty exciting.
Thanks. All right. Next question is, for Leo, Leo, can you discuss what's driving the decrease in
agent count? Yeah. So you know, the at our size and scale, we're very susceptible to larger macroeconomic behavior from age account. So more than half of the agents who've left exp this year have left the industry. In totality, 62% of non productive agents that left exp left the industry. So if you segment it out, if anyone curious goes to the first page of the appendices. You know, close to 77 78% of the people who left us had zero to two sales. But our retention on the more productive cohort of 21 plus sales has actually decreased. So our retention has increased. So we're, you know, roughly 2% attrition in the more productive part of the cohort. So we've been really focused on that. The rallying cry for this year has been where the Pro is going to grow, and it's really starting to continue to show in the level of talent we're attracting in a lot of the programs. So you know, the one of the programs I'm most excited about is called fast cap that we rolled out and announced at exp con, where we're early signs on brand new agents, getting them into productivity, a six week accountability program. And then we've continued to roll out our Fast Track attraction bonus that we've launched July 1. We got since we've launched out the program, we've paid out $5 million by the way, it has no impact. This is all part of the rush or bucket, so it still maintains the margins we're enjoying. And so we're very focused on growth throughout attraction at exp con, we announced the icon incentive program, where we opened up all seven levels to give them credit for the 30 front line qualifiers, and then the capping one for the first five. So they're all designed to incentify and attract production. So at exp con, I gave a keynote where, you know, based on the economic data that we pull from Fannie and several other economists, were more bullish based on where rates cuts have been from starting the year to ending the year. So you know, we're bullish that 2025 will have an increased transactional count over 23 and 24 which will probably end the year either flat or lower than 23 so we're bullish on all that fun stuff.
Back to you, Wendy, right. Thanks,
thanks. Yeah, Wendy, let's ask you a question. Thank you for joining us today. Can you discuss the timeline and the budget for evolving the EXP brand and and how you measure success? Yeah, absolutely. Thanks. Leah,
thanks. Denise, the good news is the brand update that I talked about, talked about we called it our flow up, but our brand is a living, breathing thing. It will continue to evolve in order to meet market needs, in order to meet our agents needs. So we'll always be looking at how we can continue to evolve and modernize the brand. The second part of your question, Denise, was sort of, how do we monitor success, and what measures do we use? And, you know, I think of marketing as having both elements of art and science. There is the art part of marketing that is very subjective, but what we really lean into is the science part of marketing, and that's the numbers, and looking at how are the marketing things that we're doing performing, and we look at things like share a voice, we look at all of the analytics that are available to us from Social media, to really monitor kind of that science or that science and that art part together. So we always continue to do that and report those numbers. But as as I said, the the beauty of EXP 2.0 is is our branding evolution is ongoing, and we'll continue to to add and improve as we move forward. Great.
Thank you. Also want to remind everybody that you can ask a question on slido. You can scan the the code that's behind me and and ask your question there. Or you could go to slido com and enter the code EXP and ask a question there. I'll open the mic to Jonathan bass, our covering analyst at Stevens. Jonathan, if you'd like to go ask a question, you can go ahead.
Perfect. Thank you. Yeah. This is Jonathan on from John, thanks for taking my questions. So in recent weeks and months, the NARS clear cooperation policy has become a big talking point within the industry. You know, you have some brokerages and industry participants have come out calling for the policy's end. And then you have others who have come out and defended it. So I'm interested to get you know your guys take on it.
Yeah, thanks. I'll jump in here. It's Leo. I'm actually probably one of the loudest executives on the defending side, you know, and this is extremely top of mind to Glenn and I, as we are battling portals in other countries that can kind of unilaterally change the pricing structure and really affect our bottom line. The US system as it stands, and the sorry, North American system, because Canada system works the same way. Is unique into itself. On the global stage, we have the most complete, the most liquid, most accurate system that exists. And I think for us who practice real estate in this part of the world, we take it for granted sometimes, like things like comps. And you know, if something's as active, and means active with definition of a bedroom and bat count. So we are extremely strong proponents. It is the best thing for the consumer, specifically because it has a total, you know, marketplace with accurate data. And it also keeps the price of marketing at a very reasonable price, because you're not having to pay per impression per month, and how we get billed in other countries. So I'm a very loud proponent of it. I wrote, wrote an op ed piece probably the last 30 days about it, and I'm wheels up to Boston tomorrow, the following day, to speak at an air conference to a couple 1000 agents about my opinions on the subject. So I think it's very important that we defend and maintain the way we do business in North America. Great. Thank you. Leo, alright, we
have another question from Tom White, our covering analyst at Da Davidson, who couldn't be with us on the stage today, but he wanted to to ask if you could, Glen, maybe give us a general update on international what are the agent trends? And what do you expect for 2025
Yeah. So one, what you'll see, obviously, is the the revenue is dramatically up year over year internationally, even though our agent count is fairly flat on an international basis. And the reason, the reason being, is that during our initial years, you know, under previous leadership, it was really focused on agent count, and we're now, we've changed our approach to productive agent count. So we internally, are now tracking our productive agents. I think I might have even mentioned, even on the last call that we're we're working on eventually creating some more transparent metrics around that specific one, because it's an important one from from our perspective. But what we do know is, like, one of the things that we're doing is, in order to be an agent exp internationally, you need to have at least, really at least one year, we say, two years, of experience in the industry, partially because we're new into the market, but it also gives us a great reputation when we Open up in a market that we're not just attracting brand new to the industry people, which is can be a little bit damaging to a reputation, if you if you have new agents that don't know what they're doing. And given that internationally, there's very few rules and a lot of countries on how to actually operate. For us, attracting a professional agent is an important piece to the to the equation. I think what you're going to see is you're going to see us announcing more countries. You're going to see more investment in international expansion, which you know in reality, will translate to higher expense, even though internally, we've got a number of countries that are now profitable inside of international so we know that even though we're opening up countries, these, from an IRR perspective, are actually good investments. As we continue to kind of move forward, we're rebuilding, in fact, you know, last night we launched, and it's very much in beta, but we launched our new exp International website. We're starting to build out our funnels. We're starting to drive traffic into our new exp international headquarters which I talked about earlier in the call, where you can come in and visit, but you'll see a link right on our exp dot international site, where you can click on it and come in and learn about help us find more agents. Help us open up new new markets. And that's being staffed, really, 24 by five. Eventually it'll be 24 by seven. So excited about how that kind of is coming together. We just launched, we've just a little couple months ago, we announced that Regis is now an available opportunity for all agents in all markets I know. Last week at exp con, we announced that Canva is now available to all agents in all markets that exp operates in. I think technically, it's being rolled out here in December, but we keep on working on agent value proposition so it becomes, eventually it's going to become an actual that you're going to want to be at exp, because we roll out so many benefits to agents. We're investing heavily in in our relationship with home Hunter, dot global, so we're going to see a lot of investment going in and break, breaking what I consider to be the stranglehold on the industry. We think there's a lot of brokerages that will that are struggling just to stay in business because of the portal costs. And so we'll be, you know, re directing some of the revenues from from North America, some of the profits, into helping us really establish beach head into to various countries. And as those get established, we'll work on building more beach heads from a portal perspective. So a lot of lot of things that we're working on, on the international front.
Great and Tom had an additional question he wanted to ask with the two initiatives announced at exp, con, the icon incentive and the revenue share capping, can you give some color as to how you expect those to impact gross margins going forward.
Yeah, so generally speaking, they shouldn't affect gross margins going forward. We've always been a company that has really focused on being the most agent centric real estate brokers on the planet. And when we say agents, we're talking about the agents that are out there listing and selling real estate. And so this will make it more sticky, and so on so forth. We've, you know, these, these programs are specifically geared, and there's some FAQs out there, but they're specifically geared to agents who are actually writing production and are actually running actual real estate teams, and so those are the ones that it's geared toward. And then our revenue share platform pays out 50% of company dollar, regardless, domestically, or 10% internationally, until agent caps. And when I say 10% is 10% of the of the gross commission income internationally, it's it's 50% or 10% of the gross commission income until an agent caps domestically in the entire GCI and and the so it won't actually impact what we pay out. So gross margins won't change, but we do know it's going to impact agents. We've already, already got lots of feedback from productive agents who are really happy about this. We also announced something at exp con, which was the international sponsorship program. I talked about that earlier, but that's, I think going to be something we're going to look at and how we can use that even more domestically, to to create more more growth as well. Great.
We have a couple questions on slido for either you or Leo as agents or business planning for 2025 How do you see the housing market in the US changing, and what should agents take into account as
they look at 2025 I'll jump
into that one. That's one I've been answering for.
Great, go ahead.
Can you okay? That's one I've been answering for the media quite a bit. You know, if we look at where rates started in Jan one to today, they've come down enough where, if and again, we just had a Fed cut a couple hours ago. So assuming rate hold and there's no increases, the typical spread between the 10 year treasury and mortgage rates is somewhere between 150 to 200 basis points, and they've been trending to 250 to 300 basis points. So we have some hope that rates can continue to normalize now that we have the election behind us. So the early additions I've heard or have made, based on the economists suggestions, is that we could see about a 10% bump in total transaction count. So if we in the year somewhere between 3.8 resale 3.8 million resells and 700,000 new construction, we could hopefully see somewhere in that four, four and a half million transactional range for next year. And from you know, we play a finite game of transactions, and with continued market share, that could be great across the platform. So you know what I'm saying to agents, quite a bit is actually to continue to focus on the basics. As the rates come down, it brings people back into the market that just couldn't get there. So there's a portion of consumers that are always making the choice between continuing to rent or enter the property ladder, versus there are sellers who are still rate locked. I think that's that I shared at exp on this. Something as high as 84% of all rates or all mortgages in this country are probably below five, five and a half percent. So there is that rate lock phenomenon that we've been experiencing the exacerbates the market. But the lower the rates come down, the more it'll bring buyers back into the market and hopefully pen defrost and fall some of the sellers that are rate locked, but we are bullish going into 2025 versus the feeling we had this time last year from 23 to 24
great. Thanks, Leo. And one clarifying question, this is our last question on slido, does the agent count include the 2900 agents from the acquisition in q2 Yeah, great. Okay, all right. Well, this concludes our earnings call for the third third quarter. Thank you everyone for joining as always. Please stay connected by visiting ex. world holdings for the latest updates on exp nude.
