Acquisition and Growth - Fathom Holdings Inc. acquired My Home Group, increasing its presence in Arizona and Washington with over 2,200 agents [266]. - Fathom's real estate agent licenses grew by 21% to approximately 14,300 at December 31, 2024, up from approximately 11,795 at December 31, 2023 [285]. Financial Performance - For the year ended December 31, 2024, total revenue decreased by approximately 10.0millionor2.9335.2 million compared to 345.2millionin2023,primarilyduetoadecreaseintransactionvolumecausedbyhistoricallyhighhouseprices[307].−Grosscommissionincomefor2024was314.7 million, a decrease of 10.7millionor3.30.6 million or 3.1% to 20.4millionin2024,drivenbygrowthinmortgageloansandtitleservicetransactions[308].−Totaloperatingexpensesdecreasedbyapproximately9.8 million or 2.7% to 358.6millionin2024,withsignificantreductionsincommissionandservicecosts,generalandadministrativeexpenses,andmarketingexpenses[309].−Generalandadministrativeexpensesdecreasedbyapproximately2.5 million or 6.9% to 33.6millionin2024,primarilyduetotheeliminationofcostsrelatedtotheinsurancebusinesssoldinMay2024[312].−AdjustedEBITDAfor2024is(5,710) thousand, compared to (4,111)thousandin2023,indicatingadeclineinoperationalperformance[333].−Netlossfor2024is(21,577) thousand, slightly improved from (23,981)thousandin2023[333].−Stock−basedcompensationdecreasedto8,839 thousand in 2024 from 12,994thousandin2023,reflectingareductioninequity−relatedexpenses[333].−Depreciationandamortizationexpenseswere5,423 thousand in 2024, down from 5,947thousandin2023,indicatingaslightdecreaseinasset−relatedcosts[333].−Othernetexpensesroseto2,094 thousand in 2024 from 580thousandin2023,highlightingincreasedoperationalcosts[333].MarketTrends−Existinghomesalesdeclinedby6.2404,400, a 6% increase from 382,600inDecember2023[276].−Thecompanyanticipatesa94.7 million, a significant improvement from 10.6millionusedin2023,indicatingbetteroperationalefficiency[324].LegalandCompliance−TheNARsettlementinvolvedapaymentof418 million over four years, resolving claims against the company related to antitrust violations [282]. - Litigation contingency expenses increased to 3,491thousandin2024,withnosuchexpensesreportedin2023,suggestingpotentialongoinglegalchallenges[333].FinancialPosition−AsofDecember31,2024,thecompanyhadcurrentassetsof25.0 million, an increase of 7.6% from 23.2millionin2023,whilecurrentliabilitiesincreasedby18.519.4 million [317]. - The company raised approximately $2.7 million in net proceeds from a registered direct offering of common stock in March 2025, enhancing its liquidity position [317]. Reporting and Transparency - The company continues to exclude significant recurring expenses from Adjusted EBITDA, which may mask underlying performance trends [332]. - The company is committed to transparency in financial reporting by providing Adjusted EBITDA as a supplemental measure for investors [330]. - Goodwill is subject to annual impairment testing, with management believing that the estimated fair value of reporting units exceeds their carrying values [338]. - The company is classified as an emerging growth company and a small reporting company, allowing for reduced reporting requirements under the JOBS Act [346].
