Fathom Holdings Inc.
For the period ended Dec 31, 2025. Filed Mar 30, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Mar 30, 2026
FTHM$0.15-2.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-28.
0001628280-25-015336
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-03-30.
0001628280-26-022057
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 131 previous paragraphs and 123 current paragraphs.
59 unchanged; 53 reworded; 11 added; 16 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 5 previous and 5 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (11)
Current report
In November 2024, the Company acquired My Home Group ("MHG"), a real estate brokerage business in Arizona for total consideration of approximately $4.2 million. The purchase price included initial cash consideration of approximately $0.3 million and 814,672 shares of the Company's common stock with an acquisition date fair value of $2.1 million. $1.0 million of additional consideration, subject to certain adjustments, as defined, was due within one year of the acquisition date; however, no payment was made as the applicable conditions for such consideration were not satisfied. Further, contingent consideration with an initial estimated present value of $0.7 million is due upon the occurrence of certain milestones. The Company will pay the contingent consideration, which may be paid in cash or shares of common stock at the Company’s discretion, equal to the amount by which MHG's net income exceeds defined thresholds during each fiscal year through December 31, 2027. The acquisition was accounted for as a business combination in accordance with ASC 805. Assets acquired and liabilities assumed in the individual acquisitions were recorded on the Company’s consolidated balance sheet at their estimated fair values as of acquisition date, including current assets of $0.1 million and accounts payable and accrued liabilities of $0.2 million. The Company recorded finite-lived intangible assets of approximately $3.2 million and goodwill of approximately $1.4 million.
Current report
For the year ended December 31, 2025, MHG's revenue was $126.7 million. The related earnings do not have a material effect on the Company’s consolidated results of operations. Pro forma information has not been included as it is impracticable to obtain the information due to the lack of availability of historical GAAP financial data.
Current report
In October 2025, the Company acquired START Real Estate ("START"), a real estate brokerage business in the Colorado real estate market, for total consideration of approximately $1.2 million. The purchase price included initial cash consideration of approximately $0.2 million and 157,356 shares of the Company's common stock with an acquisition date fair value of $0.3 million. Contingent consideration with an initial estimated present value of $0.7 million is due upon the occurrence of certain milestones. The Company will pay the contingent consideration, which may be paid in cash or shares of common stock at the Company’s discretion, equal to the amount by which START's net income exceeds defined thresholds during each fiscal year through December 31, 2028. The acquisition was accounted for as a business combination in accordance with ASC 805. Assets acquired and liabilities assumed in the individual acquisitions were recorded on the Company’s consolidated balance sheet at their estimated fair values as of acquisition date, including current assets of $0.04 million and accounts payable and accrued liabilities of $0.1 million. The Company recorded finite-lived intangible assets of approximately $0.8 million and goodwill of approximately $0.3 million. None of the goodwill is expected to be deductible for income tax purposes.
Current report
Financing Transactions
Current report
In September 2025, the Company completed the September 2025 Offering, which resulted in the issuance and sale by the Company of 3,450,000 shares of common stock at an offering price of $2.00 per share, generating gross proceeds of $6.9 million, of which the Company received total net proceeds of $6.5 million, after deducting underwriting discounts and other offering costs.
Current report
The Company's Chief Executive Officer is its Chief Operating Decision Maker ("CODM"), who is responsible for evaluating the performance of the Company's operating segments and allocating resources. 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 CODM. The Company does not conduct business outside of the United States and no single customer accounts for more than 10% of total revenue in any reporting period.
Current report
For the year ended December 31, 2025, total litigation contingency expenses decreased by approximately $1.5 million, or 41.9%, as compared with the year ended December 31, 2024. The decrease was due to reduced legal settlement fees being incurred in the current year, whereas the prior year included substantial legal costs associated with the NAR Settlement and related activities.
Current report
In September 2025, the Company completed an offering of common stock (the "September 2025 Offering"), which resulted in the issuance and sale by the Company of 3,450,000 shares of common stock at an offering price of $2.00 per share, generating gross proceeds of $6.9 million, of which the Company received total net proceeds of $6.5 million, after deducting underwriting discounts and other offering costs.
Current report
Net cash used in operating activities was approximately $20.5 million for the year ended December 31, 2025, compared to $4.7 million for the year ended December 31, 2024. The increase in cash used in operating activities was primarily driven by changes in mortgage activity, where originations of mortgage loans held for sale increased to $248.1 million compared to $234.0 million in 2024, while proceeds from sales and principal payments increased to $244.5 million from $243.8 million, resulting in a larger net cash outflow due to timing differences between loan originations and sales. Non-cash adjustments included $5.8 million of depreciation and amortization, and $3.7 million of stock-based compensation, partially offset by a $7.1 million gain on sale of mortgages. Changes in operating assets and liabilities also contributed to cash usage, primarily due to increases in prepaid and other current assets and accounts receivable, partially offset by increases in accounts payable and accrued liabilities.
Current report
Net cash provided by investing activities was approximately $4.0 million for the year ended December 31, 2025, compared to $3.3 million for the year ended December 31, 2024. Proceeds from the sale of multiple businesses were $7.1 million in 2025 compared to $7.4 million in 2024. Proceeds in 2025 were derived from multiple business dispositions, including the sale of the Company’s LiveBy business and the receipt of a second payment related to the prior-year sale of its insurance business. Proceeds in 2024 were primarily attributable to the sale of the Company’s insurance business. Purchases of intangible assets were $2.8 million in 2025 compared to $3.2 million in 2024, while cash used for acquisitions decreased to $0.2 million from $0.8 million in the prior year.
Current report
Net cash provided by financing activities was $15.0 million for the year ended December 31, 2025 compared to $1.2 million for the year ended December 31, 2024. The increase was primarily driven by $9.5 million of gross proceeds from public offerings of common stock in 2025, partially offset by $0.4 million of offering costs. Principal debt repayments were $4.6 million in 2025 compared to $0.6 million in 2024. In 2024, the Company received $5.7 million in debt proceeds, while no new debt was issued in 2025. Borrowings and repayments under warehouse lines of credit were $246.9 million and $236.3 million, respectively, in 2025, compared to $233.3 million and $237.1 million in 2024, reflecting an increase in transaction volume and timing of mortgage loan originations and sales.
Removed paragraphs (16)
Previous report
On November 1, 2024, the Company acquired My Home Group ("MHG"). MHG is a real estate agency group with over 2,200 agents. This acquisition increases the Company's real estate brokerage and ancillary business presence in Arizona and Washington.
Previous report
Stock Offering
Previous report
For the years ended December 31, 2023 and 2022, due in part to the widespread availability of multiple COVID-19 vaccines, the effects of the COVID-19 on business worldwide lessened. However, the continuing impact from COVID-19, as well as the recent increases in interest rates and inflationary pressure in the U.S. and world economies, is not fully known and cannot be estimated as the U.S. and global economies continue to react.
Previous report
Insurance Agency Service Revenue
Previous report
The revenue streams for the Company’s home and other insurance agency services business were primarily comprised of new and renewal commissions paid by insurance carriers. The transaction price was determined based on the estimated commissions to be received over the term of the policy, which were based on estimates of premiums placed, policy changes, and cancellations, net of constraints. Commissions were earned upon the effective date of the associated policies, which was the point at which control of the policy transferred to the client.
Previous report
The Company was also eligible for certain contingent commissions from insurers based on the attainment of specific metrics (e.g., volume growth, loss ratios) related to the underlying policies placed. Revenue for contingent commissions was estimated based on historical and current evidence of achievement toward each insurer’s respective annual metrics and was recognized as the underlying policies contributing to those achievements were placed. Due to the uncertainty in the amount of contingent consideration, the Company constrained estimated revenue to an amount for which a significant negative adjustment was not probable. Contingent consideration was generally received in the first quarter of the subsequent year.
Previous report
The Company sold its home and other insurance agency services business on May 3, 2024.
Previous report
For the year ended December 31, 2024, litigation contingency expenses increased by $3.5 million, or 100%, as compared with the year ended December 31, 2023. The increase in litigation contingency expenses is due to the accrued NAR settlement and related legal expenses.
Previous report
In December 2023, the Company, completed an offering of common stock, which resulted in the issuance and sale by the Company of 2,000,000 shares of common stock, at a public offering price of $2.00 per share and an option to the underwriters to purchase up to additional 450,000 shares. In December 2023, the underwriters exercised their option to purchase the additional shares. The December Offering generated gross proceeds of approximately $4.9 million, of which the Company received approximately $4.2 million, after deducting underwriting discounts and other offering costs.
Previous report
Net cash used in operating activities for the year ended December 31, 2024 consisted of a net loss of $21.6 million, including non-cash charges of $8.8 million of share-based compensation, $5.4 million of depreciation and amortization, and a $5.9 million gain on sale of mortgages. Non-cash lease expense was $2.1 million and was offset by a $2.3 million decrease in operating lease right of use liabilities. Other principal changes in operating assets and liabilities were the $9.8 million positive net effect of sale and payment of mortgage loans held for sale.
Previous report
Net cash provided by investing activities for the year ended December 31, 2024 consisted primarily of $7.4 million related to the sale of our insurance business on May 3, 2024 offset by cash used in investing activities of $3.2 for costs incurred related to intangible assets.
Previous report
Net cash used in financing activities for the year ended December 31, 2024 consisted of $3.8 million of net borrowings on warehouse lines of credit, $5.7 million from the issuance of convertible note payable, partially offset by $0.6 million in debt payments.
Previous report
JOBS Act Transition Period
Previous report
In April 2012, the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”) was enacted. Section 107 of the JOBS Act provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. Thus, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies.
Previous report
Subject to certain conditions, as an emerging growth company, we may rely on certain other exemptions and reduced reporting requirements under the JOBS Act. Certain of these exemptions are, including without limitation, from the requirements of (i) providing an auditor’s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; and (ii) complying with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements, known as the auditor discussion and analysis. We will remain an emerging growth company until the earlier to occur of (1) the last day of the fiscal year (a) following the fifth anniversary of the effectiveness of this registration statement, (b) in which we have total annual gross revenues of at least $1.07 billion, or (c) in which we are deemed to be a “large accelerated filer” under the rules of the U.S. Securities and Exchange Commission, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. Our status as an emerging growth company ends as of December 31, 2025.
Previous report
As part of being an emerging growth company, the Company is also considered a small reporting company ("SRC") as of December 31, 2024. Under the terms of the JOBS Act, a SRC has public float of less than $250 million or has less than $100 million in annual revenue and no public float or public float less than $700 million. Being a SRC allows the Company to include less extensive narrative disclosure than required of other reporting companies, particularly concerning executive compensation. It also provides audited financial statements for two fiscal years, in contrast to non-SRCs, which must provide audited financial statements for three fiscal years.
Reworded paragraphs (53)
Previous wording
Fathom Holdings Inc. (the “Company”, “Corporate”, “Our”, “We”), headquartered in Cary, North Carolina, is a national, technology-driven, end-to-end real estate services company integrating residential brokerage, mortgage, title, insurance and SaaS offerings for brokers and agents. Our primary operation, Fathom Realty (as defined below), operates as a real estate brokerage company, working with real estate agents to help individuals purchase and sell residential and commercial properties, primarily in the South, Atlantic, Southwest, and Western parts of the United States, with the intention of expanding into all states.
Current wording
Fathom Holdings Inc. (the “Company,” “Our,” or “We”), headquartered in Cary, North Carolina, is a national, technology-driven, end-to-end real estate services company integrating residential brokerage, mortgage, title, and SaaS offerings for brokers and agents. Our primary business, Fathom Realty (as defined below), operates as a real estate brokerage company, working with real estate agents to help individuals purchase and sell residential and commercial properties, primarily in the South, Atlantic, Southwest, and Western parts of the United States, with the intention of expanding into all states.
Previous wording
Fathom Realty Holdings, LLC, a Texas limited liability company (“Fathom Realty”), is a wholly owned subsidiary of Fathom Holdings Inc. Fathom Realty owns 100% of 43 subsidiaries, each an LLC representing the state in which the entity operates (e.g. Fathom Realty NJ, LLC).
Current wording
Fathom Realty Holdings, LLC, a Texas limited liability company (“Fathom Realty”), is a wholly owned subsidiary of the Company. Fathom Realty owns 100% of 43 subsidiaries, each an LLC representing the state in which the entity operates (e.g. Fathom Realty NJ, LLC).
Previous wording
In December 2023, the Company completed an offering of common stock, which resulted in the issuance and sale by the Company of 2,450,000 shares of common stock, at a public offering price of $2.00 per share, generating gross proceeds of approximately $4.9 million, of which the Company received approximately $4.2 million after deducting underwriting discounts and other offering costs.
Current wording
In December 2023, the Company completed an offering of common stock, which resulted in the issuance and sale by the Company of 2,450,000 shares at a public offering price of $2.00 per share, generating gross proceeds of approximately $4.9 million, of which the Company received approximately $4.2 million after deducting underwriting discounts and other offering costs.
Previous wording
On March 10, 2025, the Company issued and sold shares of its common stock to certain investors and members of the Company’s Board in a registered direct offering (the “2025 Offering”). The cash proceeds to the Company from the issuance of the shares of common stock in the 2025 Offering were approximately $2.7 million after deducting the 2025 Offering expense.
Current wording
In March 2025, the Company completed the March 2025 Offering, which resulted in the issuance and sale by the Company of 3,505,364 shares of common stock at an offering price of $0.68 per share and 832,639 shares of common stock at an offering price of $0.72 per share, generating gross proceeds of $3.0 million, of which the Company received total net proceeds of $2.9 million after deducting underwriting discounts and other offering costs. The Company issued and sold shares of its common stock to certain investors and members of the Company’s Board.
Previous wording
Our business is dependent on the economic conditions within the markets in which we operate. Changes in these conditions can have a positive or negative impact on our business. The economic conditions influencing the housing markets primarily include economic growth, interest rates, unemployment, consumer confidence, mortgage availability and supply and demand.
Current wording
Our business depends on the economic conditions of the markets in which we operate. Changes in these conditions can impact our business. The economic conditions influencing the housing markets primarily include economic growth, interest rates, unemployment, consumer confidence, mortgage availability and supply and demand.
Previous wording
In periods of economic growth, demand typically increases resulting in higher home sales transactions and home sales prices. Similarly, a decline in economic growth, increasing interest rates and declining consumer confidence generally decreases demand. Additionally, regulations imposed by local, state and federal government agencies and geopolitical instability, can also negatively impact the housing markets in which we operate.
Current wording
Demand for housing typically increases in periods of economic growth, resulting in higher home sales transactions and home sales prices. Similarly, a decline in economic growth, increasing interest rates and declining consumer confidence generally decreases demand. Additionally, regulations imposed by local, state and federal government agencies and geopolitical instability can negatively impact the housing markets in which we operate.
Previous wording
Due to the increasing interest rates and increasing inflation, the market began a contraction trend beginning in the second quarter of 2022. In 2023, the existing home sales market declined 6.2%, and declined an additional 0.7% in 2024 according to the NAR, which is the lowest the market has been since 1995.
Current wording
Due to rising inflation and increasing mortgage interest rates, the U.S. residential real estate market began a contraction trend in the second quarter of 2022. In 2023, existing home sales declined approximately 6.2% compared to the prior year and declined an additional approximately 0.7% in 2024. In 2025, existing home sales remained at historically subdued levels, totaling approximately 4.06 million units, representing little growth from 2024, one of the lowest annual transaction volumes recorded since 1995.
Previous wording
The Company believes that it continues to be well positioned for growth in all of its businesses in the current economic climate. We have a strong base of agent support, which should drive organic market share growth, retention and productivity. Additionally, we have an efficient operating model with lower fixed costs driven by our cloud-based model, with minimum brick-and-mortar locations.
Current wording
The Company believes that it is well-positioned for growth in all of its businesses in the current economic climate. We have a strong base of agent support, which should drive organic market share growth, retention and productivity. Additionally, we have an efficient operating model with lower fixed costs driven by our cloud-based model, with minimum brick-and-mortar locations.
Previous wording
Regardless of whether the housing market continues to slow or grow, we continue to believe that we are positioned to leverage our low-cost, high-engagement model, affording agents and brokers increased income and ownership opportunities while offering a scalable solution to brokerage owners looking to prosper in a series of fluctuations in economic activity.
Current wording
Regardless of whether the housing market continues to slow or grow, we believe that we are positioned to leverage our low-cost, high-engagement model, affording agents and brokers increased income and ownership opportunities while offering a scalable solution to brokerage owners looking to prosper in a series of fluctuations in economic activity.
Previous wording
Throughout 2024, historically elevated mortgage interest rates and high home prices have caused inventory levels, as measured in months of supply, to rise. Construction of new homes continues to slow also due to historically elevated mortgage interest rates and the strained availability of labor and materials. According to the NAR, inventory of existing homes for sale in the U.S. was 1.15 million at the end of December 2024 compared to 990,000 at the end of December 2023.
Current wording
Throughout 2024 and continuing into 2025, historically elevated mortgage interest rates and high home prices contributed to subdued transaction activity and increased inventory levels. Construction of new homes also remained constrained due to elevated financing costs and continued challenges related to labor availability and material costs. According to the NAR, inventory of existing homes for sale in the United States was approximately 1.15 million units at the end of December 2024, compared to approximately 990,000 units at the end of December 2023. Inventory levels increased further during 2025 as transaction activity remained below long-term historical averages.
Previous wording
Historically elevated mortgage interest rates are negatively impacting the demand for homebuying. Based on Freddie Mac data, the average rate for a 30-year, conventional fixed rate mortgage was 6.61% in December 2024 and 2023. If inflation continues to moderate into 2025 as anticipated, mortgage rates should decline, which we expect to boost homebuyer demand and homebuilder sentiment. The NAR anticipates transactions to increase by 9% in 2025 ,from 4.06 million existing home sales to 4.5 million existing home sales. According to the NAR, nationwide average sales price for existing homes in December 2024 (preliminary) was $404,400, up 6% from $382,600 in December 2023.
Current wording
Historically elevated mortgage interest rates are negatively impacting the demand for homebuying. Based on Freddie Mac data, the average rate for a 30-year, conventional fixed rate mortgage was 6.21% in December 2025 compared to 6.61% in December 2024. If inflation continues to lessen into 2026 as anticipated, mortgage rates should decline, which we expect to boost homebuyer demand and homebuilder sentiment. The NAR anticipates transactions to increase by 14% in 2026, from 4.06 million existing home sales in 2025 to 4.63 million existing home sales in 2026. According to the NAR, nationwide average sales price for existing homes in December 2025 (preliminary) was $405,400, up 0.4% from $403,700 in December 2024.
Previous wording
In response to these macroeconomic and consumer demand developments, we took action to adjust our operations and manage our business towards longer-term profitability despite these adverse macroeconomic factors. Looking ahead, we remain focused on getting back to positive total company Adjusted EBITDA for the full year 2025.
Current wording
In response to these macroeconomic and consumer demand developments, we adjusted our operations to manage our business towards longer-term profitability despite these adverse macroeconomic factors. Looking ahead, we remain focused on getting back to positive total company Adjusted EBITDA for the full year 2026.
Previous wording
On October 31, 2023, a federal jury in Missouri found that the NAR and certain companies conspired to artificially inflate brokerage commissions, which violates federal antitrust law. The judgment was appealed on October 31, 2023. Additionally, certain other brokerage defendants settled with the plaintiffs, including both monetary and non-monetary settlement terms. That same day, the NAR, EXP World Holdings, Inc., Compass, Inc., Redfin Corporation, Weichert Realtors, United Real Estate, Howard Hann Real Estate Services, and Douglas Elliman, Inc. were named as defendants in Gibson v. National Association of Realtors (U.S. District Court for the Western District of Missouri), alleging a similar fact pattern and antitrust violations. On or about March 15, 2024, NAR agreed to settle the Burnett Ruling, along with a sister litigation, by agreeing to pay $418 million over approximately four years, and changing certain of its rules surrounding agent commissions (the “NAR Settlement”). On November 26, 2024, the NAR Settlement was granted over objections, which resolved the claims against the Company.
Current wording
On October 31, 2023, a federal jury in Missouri found that the NAR and certain companies conspired to artificially inflate brokerage commissions, which violates federal antitrust law. The judgment was appealed on October 31, 2023. Additionally, certain other brokerage defendants settled with the plaintiffs, including both monetary and non-monetary settlement terms. That same day, the NAR, EXP World Holdings, Inc., Compass, Inc., Redfin Corporation, Weichert Realtors, United Real Estate, Howard Hann Real Estate Services, and Douglas Elliman, Inc. were named as defendants in Gibson v. National Association of Realtors (U.S. District Court for the Western District of Missouri), alleging a similar fact pattern and antitrust violations. On or about March 15, 2024, NAR agreed to settle the Burnett Ruling, along with a sister litigation, by agreeing to pay $418 million over approximately four years, and changing certain of its rules surrounding agent commissions (the “NAR Settlement”). In November 2024, the NAR Settlement was granted over objections, which resolved the claims against the Company.
Previous wording
There could also be further changes in real estate industry practices. All of this has prompted discussion of changes to rules established by local or state real estate boards or multiple listing services. All of this may require changes to many brokers’ business models, including changes in agent and broker compensation. For example, many of our competitors may need to develop mechanisms and a plan that enable buyers and sellers to negotiate commissions. In contrast, our flat fee per real estate transaction model has always enabled our agents to negotiate their own fees. Our flat fee makes it so we have never interfered with our agents' ability to negotiate commissions and have no direct incentive to do so. Our flat fee per real estate transaction model enables our agents to freely settle their transaction commissions at their own discretion. The Company will continue to monitor ongoing and similar antitrust litigation against our competitors, however, as our agent compensation model fully supports commission negotiation, we do not expect to have to change our compensation model in a manner that would adversely affect our financial condition and results of operations. However, the litigation and its ramifications could cause unforeseen turmoil in our industry, the impacts of which could have a negative effect on us as an industry participant.
Current wording
There could also be further changes in real estate industry practices. All of this has prompted discussion of changes to rules established by local or state real estate boards or multiple listing services. All of this may require changes to many brokers’ business models, including changes in agent and broker compensation. For example, many of our competitors may need to develop mechanisms that enable buyers and sellers to negotiate commissions. In contrast, our flat fee per real estate transaction model has always enabled our agents to negotiate their own fees. Our flat fee helps us avoid interfering with our agents' ability to negotiate commissions because we have no direct incentive to do so. Our flat fee per real estate transaction model enables our agents to freely settle their transaction commissions at their own discretion. The Company will continue to monitor ongoing and similar antitrust litigation against our competitors, however, as our agent compensation model fully supports commission negotiation, we do not expect to have to change our compensation model in a manner that would adversely affect our financial condition and results of operations. However, the litigation and its ramifications could cause unforeseen turmoil in our industry, the impacts of which could have a negative effect on us as an industry participant.
Previous wording
Due to our low-overhead business model, which leverages our proprietary technology, we can offer our agents the ability to keep significantly more of their commissions compared to traditional real estate brokerage firms. We believe we offer our agents some of the best technology, training, and support available in the industry. We believe our business model and our focus on treating our agents well will attract more agents and higher-producing agents.
Current wording
Due to our low-overhead business model, we can offer our agents the ability to retain significantly more of their commissions compared to traditional real estate brokerage firms. We believe we offer our agents some of the best technology, training, and support available in the industry. We believe our business model and our focus on treating our agents well will attract more agents and higher-producing agents.
Previous wording
Fathom’s real estate agent licenses grew 21% to approximately 14,300 agent licenses at December 31, 2024, up from approximately 11,795 at December 31, 2023.
Current wording
Fathom’s real estate agent licenses decreased 1.2% to approximately 14,135 agent licenses as of December 31, 2025, down from approximately 14,300 as of December 31, 2024.
Previous wording
Beginning January 1, 2023, agents have been primarily able to earn stock grants in the form of stock units based on agent referral metrics achieved. These stock grants typically are granted quarterly and vest in two years.
Current wording
Beginning in January 2023, agents have been primarily able to earn stock grants in the form of stock units based on the achievement of agent referral metrics. These stock grants typically are granted quarterly and vest in two years. The Company discontinued this program during 2025, and no additional stock grants are expected to be issued under this program in the future.
Previous wording
Our CEO, who is our Chief Operating Decision Maker ("CODM"), makes operating decisions and assesses performance based on the services of identified operating segments and has identified three operating and 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.
Current wording
Our CODM makes operating decisions and assesses performance based on the services of identified operating segments and has identified three operating and reportable segments: (1) Real Estate Brokerage, (2) Mortgage, and (3) Title. 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 Title segment, the Company provides title insurance, escrow, and settlement services to facilitate residential real estate transactions.
Previous wording
The CODM reviews revenue and adjusted EBITDA 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 share-based compensation expense. In particular, the Company believes the exclusion of non-cash share-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. See "NON-GAAP FINANCIAL MEASURE" below for more information.
Current wording
The CODM reviews revenue and Adjusted EBITDA 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. We define Adjusted EBITDA as net income (loss), excluding: (i) other income and expense, (ii) costs related to acquisitions, (iii) income taxes, (iv) depreciation and amortization, and (v) share-based compensation expense. In particular, the Company believes the exclusion of non-cash share-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. Refer to Note 17 – Segment Reporting for further information regarding the Company’s business segments.
Previous wording
Our revenue primarily consists of commissions generated from real estate brokerage services. We also have other service revenue, including mortgage lending, title insurance, home and other insurance, and SaaS revenues.
Current wording
Our revenue primarily consists of commissions generated from real estate brokerage services. We also have other service revenue, including mortgage lending, title insurance, and SaaS revenues.
Previous wording
We recognize commission-based revenue on the closing of a transaction, less the amount of any closing-cost reductions. Revenue is affected by the number of real estate transactions we close, the mix of transactions, home sale prices, and commission rates.
Current wording
We recognize commission-based revenue when a transaction closes, less the amount of any closing-cost reductions. Revenue is affected by the number of real estate transactions we close, the mix of transactions, home sale prices, and commission rates.
Previous wording
We recognize revenue streams for our mortgage lending services business which are primarily comprised of loans sold, origination and other fees.
Current wording
We recognize revenue streams for our mortgage lending services business which primarily consists of loans sold, origination and other fees.
Previous wording
Retail origination fees are principally revenues from loan originations and recorded in the statement of operations in other service revenue. Direct loan origination costs and expenses associated with the loans are charged to expenses when the loans are sold. Interest income is interest earned on originated loans prior to the sale of the asset.
Current wording
Retail origination fees are principally revenues from loan originations and are recorded in the statement of operations in other service revenue. Direct loan origination costs and expenses associated with the loans are expensed when the loans are sold. Interest income is interest earned on originated loans prior to the sale of the asset.
Previous wording
The Company generates revenue from subscription and services related to the use of the LiveBy platform. The SaaS contracts are generally annual contracts paid monthly in advance of service and cancellable upon 30 days’ notice after the first year. The Company’s subscription arrangements do not provide customers with the right to take possession of the software supporting the platform. Subscription revenue, which includes support, is recognized on a straight-line basis over the non-cancellable contractual term of the arrangement, generally beginning on the date that the Company’s service is made available to the customer and is recorded as other service revenue in the statement of operations.
Current wording
The Company generated revenue from subscription and services related to the use of the LiveBy platform. The SaaS contracts are generally annual contracts paid monthly in advance of service and cancellable upon 30 days’ notice after the first year. The Company’s subscription arrangements do not provide customers with the right to take possession of the software supporting the platform. Subscription revenue, which includes support, is recognized on a straight-line basis over the non-cancellable contractual term of the arrangement, generally beginning on the date that the Company’s service is made available to the customer and is recorded as other service revenue in the statement of operations. The Company sold LiveBy in November 2025.
Previous wording
Commission and service costs consists primarily of agent commissions, less fees paid by the Company to agents, order fulfillment, share-based compensation for agents, title searches, and direct cost to fulfill the services provided for our brokerage, mortgage lending, title service, insurance services and other services provided.
Current wording
Commission and service costs consist primarily of: agent commissions, less fees paid by the Company to agents; order fulfillment; share-based compensation for agents; title searches; and direct costs to fulfill the services provided for our brokerage, mortgage lending, title service, and other services provided.
Previous wording
General and administrative expenses consist primarily of fees for professional services and personnel costs, related to including base pay, bonuses, benefits, and share based compensation. Professional services principally consist of external legal, audit, and tax services. In the short term, we expect general and administrative expenses to increase in absolute dollars due to the anticipated growth of our business and to meet the increased compliance requirements associated with operation as a public company. However, in the long term, we anticipate general and administrative expenses as a percentage of revenue to decrease over time, if and as revenue increases.
Current wording
General and administrative expenses consist primarily of fees for professional services and personnel costs, including base pay, bonuses, benefits, and share-based compensation. Professional services principally consist of external legal, audit, and tax services. In the short term, we expect general and administrative expenses to increase in absolute dollars due to the anticipated growth of our business and to meet the increased compliance requirements associated with operation as a public company. However, in the long term, we anticipate general and administrative expenses as a percentage of revenue to decrease over time, if and as revenue increases.
Previous wording
Marketing expenses consist primarily of online and traditional advertising, as well as costs for marketing and promotional materials. Advertising costs are expensed as they are incurred. We expect marketing expenses to increase in absolute dollars as we continue to expand our advertising programs, and promote of our newly acquired business lines, but we anticipate marketing expenses as a percentage of revenue to decrease over time, if and as our revenue increases.
Current wording
Marketing expenses consist primarily of online and traditional advertising, as well as costs for marketing and promotional materials. Advertising costs are expensed as they are incurred. We expect marketing expenses to increase in absolute dollars as we continue to expand our advertising programs and promote our newly acquired business lines, but we anticipate marketing expenses as a percentage of revenue to decrease over time, if and as our revenue increases.
Previous wording
U.S. federal and state income tax benefits for a portion of historical net losses was recognized in the period ended December 31, 2024. Previously, we have not recognized the tax benefits because of the uncertainty of realizing a future benefit from those items. As a result of certain acquisitions during the period ended December 31, 2022, we realized a portion of the pre-existing deferred tax assets due to the reversal of taxable temporary differences. As of December 31, 2024, we had federal net operating loss carryforwards of approximately $54.6 million and state net operating loss carryforwards of approximately $28.9 million. Of the federal net operating losses $1.0 million are subject to expiration beginning in 2035 and $53.6 million carry forward indefinitely. State net operating losses will begin to expire, if not utilized, in 2032. Utilization of the net operating loss carryforwards may be subject to an annual limitation according to Section 382 of the Internal Revenue Code of 1986 as amended, and similar state law provisions.
Current wording
In 2025, we recognized a U.S. federal and state income tax benefits for a portion of historical net losses. Previously, we had not recognized the tax benefits because of the uncertainty of realizing a future benefit from those items. As a result of certain acquisitions during the period ended December 31, 2022, we realized a portion of the pre-existing deferred tax assets due to the reversal of temporary book-tax differences. As of December 31, 2025, we had federal net operating loss carryforwards of approximately $59.2 million and state net operating loss carryforwards of approximately $33.5 million. Of the federal net operating losses $1.0 million are subject to expiration beginning in 2035 and $58.2 million carry forward indefinitely. State net operating losses will begin to expire, if not utilized, in 2032. Utilization of the net operating loss carryforwards may be subject to an annual limitation according to Section 382 of the Internal Revenue Code of 1986 as amended, and similar state law provisions.
Previous wording
For the year ended December 31, 2024, gross commission income decreased by approximately $10.7 million or 3.3%, as compared with the year ended December 31, 2023. This decrease was primarily attributable to a decrease in transaction volume caused by historically high house prices. During the year ended December 31, 2024, transaction volume decreased by 3.0% to approximately 37,000 transactions compared to approximately 38,139 transactions for the year ended December 31, 2023. During the year ended December 31, 2024, average revenue per transaction increased by 2.1% to $8,712 from $8,532 during the year ended December 31, 2023.
Current wording
For the year ended December 31, 2025, gross commission income increased by approximately $84.0 million, or 26.7%, as compared with the year ended December 31, 2024. This increase was primarily attributable to a 14.6% increase in transaction volume to approximately 42,405 real estate transactions from approximately 37,000 transactions in the prior year. Our transaction volume increased primarily due to the addition of My Home Group in November 2024. Average revenue per transaction increased by 7.9% to $9,404 for year ended December 31, 2025, compared to $8,712 for the year ended December 31, 2024.
Previous wording
For the year ended December 31, 2024, other service revenue was approximately $20.4 million, a 3.1% increase from 2023. This revenue increase is primarily attributable to an increase in mortgage loans and title service transaction volume, which were primarily attributable to organic growth and walkovers, partially offset by the reduction of insurance revenue as a result of our sale of our insurance business in May 2024.
Current wording
For the year ended December 31, 2025, other service revenue was approximately $21.7 million, a 6.2% increase from 2024. This revenue increase is primarily attributable to an increase in mortgage loans and title service transaction volume, which were primarily attributable to organic growth and walkovers.
Previous wording
For the year ended December 31, 2024, commission and service costs decreased by approximately $10.0 million, or 3.2%, as compared with the year ended December 31, 2023. Commission and service cost primarily includes costs related to agent commissions, net of fees paid to us by our agents and commission costs for our mortgage and other ancillary business. These costs generally correlate with recognized revenues. As such, the decrease in commission and service costs compared to the same period in 2023 was primarily due to a decrease in agent commissions paid due to lower transaction volume mainly due to historically elevated interest rates.
Current wording
For the year ended December 31, 2025, commission and service costs increased by approximately $79.4 million, or 25.9%, as compared with the year ended December 31, 2024. Commission and service costs primarily includes costs related to agent commissions, net of fees paid to us by our agents and commission costs for our mortgage and other ancillary business. These costs generally correlate with recognized revenues. As such, the increase in commission and service costs compared to the same period in 2024 was primarily due to an increase in agent commissions paid due to higher transaction volume.
Previous wording
For the year ended December 31, 2024, general and administrative expenses decreased by approximately $2.5 million, or 6.9%, as compared with the year ended December 31, 2023. This decrease is primarily attributable due to the elimination of costs attributable to our insurance business effective upon its sale in May 2024.
Current wording
For the year ended December 31, 2025, general and administrative expenses decreased by approximately $0.5 million, or 1.5%, as compared with the year ended December 31, 2024. This decrease is primarily due to a $3.0 million decrease in stock compensation expense, partially offset by an increase in compensation expense related to the Company's investment in growth.
Previous wording
For the year ended December 31, 2024, marketing expenses decreased by approximately $0.2 million, or 4.0%, as compared with the year ended December 31, 2023. The decrease in marketing expenses is primarily related to an decrease in marketing investment for our brokerage business.
Current wording
For the year ended December 31, 2025, total marketing expenses decreased by approximately $0.6 million, or 11.0%, as compared with the year ended December 31, 2024. The decrease in marketing expenses is primarily due to the Company's reduced reliance on external marketing agencies.
Previous wording
For the year ended December 31, 2024, technology and development expenses increased by approximately $0.4 million, or 5.6%, as compared with the year ended December 31, 2023. This increase is primarily attributable to our ongoing investment in the intelliAgent platform and our LiveBy business.
Current wording
For the year ended December 31, 2025, total technology and development expenses increased by approximately $0.7 million, or 10.1%, as compared with the year ended December 31, 2024. This increase is primarily due to our ongoing investment in the intelliAgent platform.
Previous wording
For the year ended December 31, 2024, depreciation and amortization expenses decreased by approximately $0.9 million or 29.2% from the year ended December 31, 2023. The decrease in depreciation and amortization expense is primarily attributable due to the absence of depreciation and amortization related to our insurance business that we sold effective May 3, 2024.
Current wording
For the year ended December 31, 2025, depreciation and amortization expenses decreased by approximately $0.01 million, or 0.4%, as compared with the year ended December 31, 2024. The decrease was due to the absence of amortization related to our insurance business that we sold in May 2024.
Previous wording
The Company recorded an income tax benefit of$1 million and an income tax expense of $0.1 million for the years ended December 31, 2024 and 2023, respectively. The tax benefit for the period ended December 31, 2024 primarily the result of the release of a portion of the valuation allowance against historical deferred tax assets. The Company maintains a valuation allowance on the remaining net deferred tax assets at year-end due to historical operating losses.
Current wording
The Company recorded an income tax expense of $0.1 million and an income tax benefit of $1.0 million for the years ended December 31, 2025 and 2024, respectively. The tax benefit for the period ended December 31, 2025 primarily the result of the release of a portion of the valuation allowance against historical deferred tax assets. The Company maintains a valuation allowance on the remaining net deferred tax assets at year-end due to historical operating losses.
Previous wording
To date, our principal sources of liquidity have been revenues and the net proceeds we received through public offerings and private sales of our common stock, as well as proceeds from loans. As of December 31, 2024, our cash totaled approximately $7.1 million, which represented a decrease of $0.3 million compared to December 31, 2023. As of December 31, 2024, we had net working capital of approximately $5.6 million, which represented a decrease of $1.3 million compared to December 31, 2023. In March 2025, we raised approximately $2.7 million in net proceeds of a registered director offering of common stock.
Current wording
To date, our principal sources of liquidity have been revenues and the net proceeds from public offerings and private sales of our common stock, as well as proceeds from loans. As of December 31, 2025, our cash totaled approximately $5.8 million, which represented a decrease of $1.4 million compared to December 31, 2024. As of December 31, 2025, we had net working capital of approximately $2.0 million, which represented a decrease of $3.6 million compared to December 31, 2024. In March 2026, the Company received $2.0 million in proceeds from a subordinated secured promissory note maturing in April 2027.
Previous wording
In March 2025, the Company completed an offering of common stock (the "2025 Offering"), which resulted in the issuance and sale by the Company of 3,505,364 and 832,639 shares of common stock, at a public offering price of $0.68 per share and $0.72 per share respectively, generating gross proceeds of $3.0 million, of which the Company received approximately $2.7 million, after deducting underwriting discounts and other offering costs.
Current wording
In March 2025, the Company completed an offering of common stock (the "March 2025 Offering"), which resulted in the issuance and sale by the Company of 3,505,364 and 832,639 shares of common stock, at a public offering price of $0.68 per share and $0.72 per share, respectively, generating gross proceeds of $3.0 million, of which the Company received approximately $2.9 million, after deducting underwriting discounts and other offering costs.
Previous wording
The Company had cash and cash equivalents of $7.1 million and $7.4 million as of December 31, 2024 and 2023, respectively. As discussed above, the Company also raised approximately $2.7 million in the 2025 Offering. The Company also expects to receive a second installment of $4.0 million related to the sale of its insurance business, which was completed in May 2024. The Company has short-term obligations totaling $4.0 million, consisting of a $3.5 million promissory note due in April 2025 and $0.5 million in liabilities related to the NAR settlement. Management believes that existing cash along with its planned budget, growth from increasing attach rates across the Company’s businesses from internal referrals, reduction of certain expenses given initiatives implemented throughout 2024 and 2025, and the expected ability to achieve sales volumes necessary to cover forecasted expenses, provide sufficient funding for the Company to continue as a going concern for a period of at least one year from the date of the issuance of these consolidated financial statements.
Current wording
The Company had cash and cash equivalents of $5.8 million and $7.1 million as of December 31, 2025 and 2024, respectively. Management believes that existing cash along with its planned budget, the implementation of a $250 transaction fee for Fathom Realty transactions, an increase in monthly fees for MHG agents, growth from increasing attach rates across the Company’s businesses from internal referrals, ongoing expense reduction initiatives executed throughout 2025 and continuing in 2026, the ability to effectively manage working capital, and the expected ability to achieve sales volumes necessary to cover forecasted expenses, provide sufficient funding to continue as a going concern for a period of at least one year from the date of the issuance of these consolidated financial statements.
Previous wording
Our future capital requirements depend on many factors, including any future acquisitions, our level of investment in technology, and our rate of growth into new markets. Our capital requirements might also be affected by factors which we cannot control such as the residential real estate market, interest rates, and other monetary and fiscal policy changes, any of which could adversely affect the manner in which we currently operate. Additionally, as other world events, such as the ongoing conflict in Ukraine and in the Middle East, may impact the economy and our operations in new ways, we will continuously assess our liquidity needs. In the event of a sustained market deterioration, we may need or seek advantageously to obtain additional funding through equity or debt financing, which might not be available on favorable terms or at all and could hinder our business and dilute our existing shareholders.
Current wording
Our future capital requirements depend on many factors, including any future acquisitions, our level of investment in technology, and our rate of growth into new markets. Our capital requirements might also be affected by factors which we cannot control such as the residential real estate market, interest rates, and other monetary and fiscal policy changes, any of which could adversely affect the manner in which we currently operate. Additionally, we will continuously assess our liquidity needs as other world events, such as the ongoing conflict in Ukraine and in the Middle East, may impact the economy and our operations in new ways. In the event of a sustained market deterioration, we may need or seek advantageously to obtain additional funding through equity or debt financing, which might not be available on favorable terms or at all and could hinder our business and dilute our existing shareholders.
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Previous report — wording carried elsewhere
Our business is dependent on the economic conditions within the markets in which we operate. Changes in these conditions can have a positive or negative impact on our business. The economic conditions influencing the housing markets primarily include economic growth, interest rates, unemployment, consumer confidence, mortgage availability, and supply and demand.
Previous report — wording carried elsewhere
In periods of economic growth, demand typically increases resulting in increasing home sales transactions and home sales prices. Similarly, a decline in economic growth, increasing interest rates and declining consumer confidence generally decreases demand. These are the trends we are currently facing. Additionally, regulations imposed by local, state, and federal government agencies can also negatively impact the housing markets in which we operate. Finally, national and global events, including geopolitical instability, that impact economic conditions and financial markets, including interest rates, can adversely impact the housing market.
Previous report — wording carried elsewhere
In April 2023, we entered into a securities purchase agreement (the “Purchase Agreement”) with an accredited investor (the “Holder”) and issued a Senior Secured Convertible Promissory Note in the principal amount of $3,500,000 (the “Note”) in a private placement (the “Offering”). The cash proceeds disbursed to the Company from the issuance of the Note were $3,300,000, after deducting the placement agent fee and purchaser expenses.