Douglas Elliman Inc.

Previous wording

The following discussion should be read in conjunction with our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) and Audited Consolidated Financial Statements as of and for the year ended December 31, 2024 and Notes thereto, included in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”), and our Condensed Consolidated Financial Statements and related Notes as of and for the three and six months ended June 30, 2025. Any forward-looking statements are not historical facts, but rather are based on current expectations, estimates, assumptions and projections about our industry, business and future financial results. Any forward-looking statements are subject to several important factors, including those factors discussed under “Risk Factors” in our 2024 Annual Report and this Quarterly Report and “Special Note on Forward-Looking Statements,” that could cause our actual results to differ materially from those indicated in such forward-looking statements. References to “Douglas Elliman” or “Company” refer to Douglas Elliman Inc. Certain references to “Douglas Elliman Realty” refer to the Company’s residential real estate brokerage business, including the operations of Douglas Elliman Realty, LLC and Douglas Elliman of California Inc., unless otherwise specified.

Current wording

The following discussion should be read in conjunction with our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) and Audited Consolidated Financial Statements as of and for the year ended December 31, 2024 and Notes thereto, included in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Annual Report”), and our Condensed Consolidated Financial Statements and related Notes as of and for the three and nine months ended September 30, 2025. Any forward-looking statements are not historical facts, but rather they are based on current expectations, estimates, assumptions and projections about our industry, business and future financial results. Any forward-looking statements are subject to several important factors, including those factors discussed under “Risk Factors” in our 2024 Annual Report and this Quarterly Report and “Special Note on Forward-Looking Statements,” that could cause our actual results to differ materially from those indicated in such forward-looking statements. References to “Douglas Elliman” or “Company” refer to Douglas Elliman Inc. Certain references to “Douglas Elliman Realty” refer to the Company’s residential real estate brokerage business, including the operations of Douglas Elliman Realty, LLC and Douglas Elliman of California Inc., unless otherwise specified.

Previous wording

Douglas Elliman Realty operates the largest residential brokerage company in the New York metropolitan area and also conducts residential real estate brokerage operations in Florida, California, Texas, Colorado, Nevada, Massachusetts, Connecticut, Maryland, Virginia, Washington, D.C., Arizona, New Hampshire and Michigan. We also operate our investment business that invests in select PropTech opportunities through our DOUG Ventures (f/k/a New Valley Ventures LLC)subsidiary.

Current wording

Douglas Elliman Realty operates the largest residential brokerage company in the New York metropolitan area and also conducts residential real estate brokerage operations in Florida, California, Texas, Colorado, Nevada, Massachusetts, Connecticut, Maryland, Virginia, Washington, D.C., and New Jersey. We also operate our investment business that invests in select PropTech opportunities through our DOUG Ventures (f/k/a New Valley Ventures LLC)subsidiary.

Previous wording

Beginning in the first quarter of 2025, our business began to report our financial results as a single reportable segment. Presentation of our financial information for the three and six months ended June 30, 2025 and 2024, and year ended December 31, 2024 is reported as one segment. The accounting policies of the segment are the same as those described in the summary of significant accounting policies. Prior period information has been recast to conform to the current presentation. For more information, see Note 11. “Segment Information” to our condensed consolidated financial statements.

Current wording

Beginning in the first quarter of 2025, our business began to report our financial results as a single reportable segment. Presentation of our financial information for the three and nine months ended September 30, 2025 and 2024, and year ended December 31, 2024 is reported as one segment. The accounting policies of the segment are the same as those described in the summary of significant accounting policies. Prior period information has been recast to conform to the current presentation. For more information, see Note 11, “Segment Information” to our condensed consolidated financial statements.

Previous wording

Adjusted EBITDA attributed to Douglas Elliman is a non-GAAP financial measure. Adjusted EBITDA attributed to Douglas Elliman Margin is the quotient of (x) Adjusted EBITDA attributed to Douglas Elliman divided by (y) revenue. Last twelve months financial measures are non-GAAP financial measures that are calculated by reference to the trailing four-quarter performance for the relevant metric.

Current wording

and other items. Adjusted EBITDA attributed to Douglas Elliman Margin is the quotient of (x) Adjusted EBITDA attributed to Douglas Elliman divided by (y) revenue. Last twelve months financial measures are non-GAAP financial measures that are calculated by reference to the trailing four-quarter performance for the relevant metric.

Previous wording

We believe that Non-GAAP Financial Measures are important measures that supplement analysis of our results of operations and enhance an understanding of our operating performance. We believe Non-GAAP Financial Measures provide a useful measure of operating results unaffected by non-recurring items, differences in capital structures and ages of related assets among otherwise comparable companies. Management uses Non-GAAP Financial Measures as measures to review and assess the operating performance of our business, and management and investors should review both the overall performance (GAAP net income) and the operating performance (Non-GAAP Financial Measures) of our business. While management considers Non-GAAP Financial Measures to be important, they should be considered in addition to, but not as substitutes for or superior to, other measures of financial performance prepared in accordance with GAAP, such as operating income, and net income. In addition, Non-GAAP Financial Measures are susceptible to varying calculations and our measurement of Non-GAAP Financial Measures may not be comparable to those of other companies.

Current wording

We believe that Non-GAAP Financial Measures are important measures that supplement analysis of our results of operations and enhance an understanding of our operating performance. We believe Non-GAAP Financial Measures provide a useful measure of operating results unaffected by non-recurring items, differences in capital structures and ages of related assets among otherwise comparable companies. Management uses Non-GAAP Financial Measures as measures to review and assess the operating performance of our business, and management and investors should review both the overall performance (GAAP net income/loss) and the operating performance (Non-GAAP Financial Measures) of our business. While management considers Non-GAAP Financial Measures to be important, they should be considered in addition to, but not as substitutes for or superior to, other measures of financial performance prepared in accordance with GAAP, such as operating income/loss, and net income/loss. In addition, Non-GAAP Financial Measures are susceptible to varying calculations and our measurement of Non-GAAP Financial Measures may not be comparable to those of other companies.

Previous wording

(a)Represents amortization of stock-based compensation. For the last twelve months ended June 30, 2025, $2,828 of stock-based compensation is included within General and administrative expenses and $1,075 is included within Operations and support expenses on the condensed consolidated statements of operations. For the six months ended June 30, 2025, $3,626 of stock-based compensation is included within General and administrative expenses and $533 is included within Operations and support expenses on the condensed consolidated statements of operations. For the six months ended June 30, 2024, $6,308 of stock-based compensation is included within

Current wording

(a)Represents amortization of stock-based compensation. For the last twelve months ended September 30, 2025,$1,103 of stock-based compensation is included within General and administrative expenses and$1,075 is included within Operations and support expenses on the condensed consolidated statements of operations. For the nine months ended September 30, 2025,$5,517 of stock-based compensation is included within General and administrative expenses and$804 is included within Operations and support expenses on the condensed consolidated statements of operations. For the nine months ended September 30, 2024,$9,924 of stock-based compensation is included within General and administrative expenses and$793 is included within Operations and support expenses on the condensed consolidated statements of operations. For the year ended December 31, 2024,$5,510 of stock-based compensation is included within General and administrative expenses and$1,064 is included within Operations and support expenses on the consolidated statements of operations.

Previous wording

(b)Represents equity in (earnings) losses recognized from our investment in an equity method investment that is accounted for under the equity method and is not consolidated in our financial results.

Current wording

(b)Represents equity in (earnings) losses recognized from equity method investment that is accounted for under the equity method and is not consolidated in our financial results.

Previous wording

(c)Represents unusual litigation expense, settlement and related expenses incurred in connection with industry-wide antitrust class action lawsuits and other matters related to employees and agents. For the last twelve months and six months ended June 30, 2025,$17,362 and$2,958, net of amounts recovered from insurance, are included within General and administrative expenses on the condensed consolidated statements of operations, respectively. For the six months ended June 30, 2024, we incurred such expenses of$18,929 with $1,179 being included in General and administrative expenses and $17,750 being included in Antitrust litigation settlement expense in the condensed consolidated statement of operations. For the year ended December 31, 2024, we incurred unusual litigation expense, settlement and related expenses, net of $33,333 with $15,583 being included in General and administrative expenses and $17,750 being included in Antitrust litigation settlement expense on the consolidated statement of operations.

Current wording

(c)Represents unusual litigation expense, settlement and related expenses incurred in connection with industry-wide antitrust class action lawsuits and other matters related to employees and agents. For the last twelve months and nine months ended September 30, 2025,$19,343 and$8,713, net of amounts recovered from insurance, are included within General and administrative expenses on the condensed consolidated statements of operations, respectively. For the nine months ended September 30, 2024, we incurred such expenses of$22,703 with $17,750 being included in Antitrust litigation settlement expense,$3,222 being included in General and administrative expenses and$1,731 being included in Operations and support expenses, in the condensed consolidated statement of operations. For the year ended December 31, 2024, we incurred unusual litigation expense, settlement and related expenses, net of $33,333 with $17,750 being included in Antitrust litigation settlement expense and $15,583 being included in General and administrative expenses on the consolidated statement of operations.

Previous wording

(d) For the last twelve months and six months ended June 30, 2025, expense of$1,517 and benefit of $493, net of amounts recovered from insurance, are included within General and administrative expenses on the condensed consolidated statement of operations, respectively. For the year ended December 31, 2024, $2,010 is included within General and administrative expenses on the consolidated statement of operations.

Current wording

(d) For the last twelve months and nine months ended September 30, 2025, expense of$1,517 and benefit of $493, net of amounts recovered from insurance, are included within General and administrative expenses on the condensed consolidated statement of operations, respectively. For the year ended December 31, 2024, $2,010 is included within General and administrative expenses on the consolidated statement of operations.

Previous wording

The primary components of our operating expenses, the changes, which are described in the following discussion of our results of operations, are summarized below:

Current wording

The primary components of our operating expenses are summarized below:

Previous wording

•Sales and marketing. Sales and marketing expense consists primarily of marketing and advertising expenses, compensation and other personnel-related costs for employees supporting sales, marketing, expansion and related functions, occupancy-related costs and agent acquisition incentives.

Current wording

•Sales and marketing. Sales and marketing expenses consist primarily of marketing and advertising expenses, compensation and other personnel-related costs for employees supporting sales, marketing, expansion and related functions, occupancy-related costs and agent acquisition incentives.

Previous wording

•Operations and support. Operations and support expense consists primarily of compensation and other personnel-related costs for employees supporting agents, third-party consulting and professional services costs (not included in general and administrative or technology), commissions related to escrow transactions, fair value adjustments to contingent consideration for our acquisitions and other related expenses.

Current wording

•Operations and support. Operations and support expenses consist primarily of compensation and other personnel-related costs for employees supporting agents, third-party consulting and professional services costs (not included in general and administrative or technology), commissions related to escrow transactions, fair value adjustments to contingent consideration for our acquisitions and other related expenses.

Previous wording

•General and administrative. General and administrative expense consists primarily of compensation, stock-based compensation expense and other personnel-related costs for administrative employees, including executives, finance and accounting, legal, human resources, communications, property management and escrow services as well as the occupancy costs for our headquarters and other offices supporting our administrative functions and, for the three and six months ended June 30, 2024, transition service fees paid to our former parent, Vector Group, for the use of office space and employees, professional services fees for legal and finance, insurance expenses and talent acquisition expenses.

Current wording

•General and administrative. General and administrative expenses consist primarily of compensation, stock-based compensation expense and other personnel-related costs for administrative employees, including executives, finance and accounting, legal, human resources, communications, property management and escrow services as well as the occupancy costs for our headquarters and other offices supporting our administrative functions and, for the three and nine months ended September 30, 2024, transition service fees paid to our former parent, Vector Group, for the use of office space and employees, professional services fees for legal and finance, insurance expenses and talent acquisition expenses.

Previous wording

•Technology. Technology expense consists primarily of compensation and other personnel-related costs for employees in the product, engineering and technology functions, website hosting expenses, software licenses and equipment, third-party consulting costs, data licenses of PropTech and other related expenses associated with the implementation of our technology initiatives.

Current wording

•Technology. Technology expenses consist primarily of compensation and other personnel-related costs for employees in the product, engineering and technology functions, website hosting expenses, software licenses and equipment, third-party consulting costs, data licenses of PropTech and other related expenses associated with the implementation of our technology initiatives.

Previous wording

As discussed previously, effective on January 1, 2025, we began to report our financial results as a single operating and reportable segment. Therefore, the presentation of our business’s financial information for the three and six months ended June 30, 2025 and 2024 will be reported as one segment. For more information, see Note 11. “Segment Information” to our condensed consolidated financial statements.

Current wording

As discussed previously, effective on January 1, 2025, we began to report our financial results as a single operating and reportable segment. Therefore, the presentation of our business’s financial information for the three and nine months ended September 30, 2025 and 2024 will be reported as one segment. For more information, see Note 11, “Segment Information” to our condensed consolidated financial statements.

Previous wording

Revenues. Our revenues were $271,366 for the three months ended June 30, 2025 compared to $285,751 for the three months ended June 30, 2024. The $14,385 decline in revenues was primarily due to lower commissions and other brokerage income, which was driven by decreased existing home sales compared to the 2024 period, partially offset by increased revenues from our Development Marketing division. In 2025, we experienced a challenging period in May to early June when our results were negatively impacted by economic pressures, which were driven by geopolitical uncertainties, including global economic policies, as well as industry-specific headwinds related to the continuation of elevated mortgage rates, when compared to recent history. In July 2025, cash receipts from existing home sales were 0.9% more than July 2024; and, total brokerage cash receipts, which include existing home sales and receipts from our Development Marketing division, were 2.3% more than July 2024. Furthermore, July 2025 had 22 sales days, consistent with July 2024.

Current wording

Revenues. Our revenues were $262,838 for the three months ended September 30, 2025 compared to $266,316 for the three months ended September 30, 2024. The $3,478 decline in revenues was primarily due to lower commissions and other brokerage income, which was driven by decreased existing home sales and revenues from our Development Marketing division compared to the 2024 period. In the third quarter of 2025, our results continued to be negatively impacted by economic pressures, which were driven by geopolitical uncertainties, including global economic policies, as well as industry-specific headwinds related to the continuation of elevated mortgage rates, when compared to recent history.

Previous wording

Our revenues from commission and other brokerage income were $258,016 for the three months ended June 30, 2025 compared to $272,313 for the three months ended June 30, 2024, a decline of $14,297. In the three months ended June 30, 2025, our commission and other brokerage income generated from the sales of existing homes decreased by $7,747 in New York City, $5,210 in the Florida market, $3,630 in the West region and $831 in the Northeast region, compared to the 2024 period. This was offset by an increase in revenues from Development Marketing of $3,121 in the 2025 period compared to the 2024 period.

Current wording

Our revenues from commission and other brokerage income were $250,354 for the three months ended September 30, 2025 compared to $254,074 for the three months ended September 30, 2024, a decline of $3,720. In the three months ended September 30, 2025, our commission and other brokerage income generated from the sales of existing homes decreased by $5,380 in New York City and $5,603 in the Florida market. Additionally, our revenues from Development Marketing declined by $478. This was partially offset by an increase in revenues in the Northeast region of $4,818 and the West region of $2,923 in the 2025 period compared to the 2024 period.

Previous wording

Operating expenses. Our operating expenses were $276,898 for the three months ended June 30, 2025 compared to $289,424 for the three months ended June 30, 2024. The decline of $12,526 was due primarily to declines in real estate brokerage commissions of $11,863 arising primarily from declines in commissions and other brokerage income.

Current wording

Operating expenses. Our operating expenses were $273,493 for the three months ended September 30, 2025 compared to $273,747 for the three months ended September 30, 2024. The decline of $254 was due primarily to declines in real estate brokerage commissions of $6,362 arising primarily from declines in commissions and other brokerage income as well as improved margins on certain Development Marketing projects. These amounts were partially offset by an increase in general and administrative expenses of $3,561 primarily due to increases in legal and personnel expenses.

Previous wording

Real Estate Agent Commissions. As a result of declines in our commissions and other brokerage income, our real estate agent commissions expense was $204,594 for the three months ended June 30, 2025 compared to $216,457 for the three months ended June 30, 2024, representing a decline of $11,863. Real estate agent commissions expense, as a percentage of revenues, decreased to 75.4% for the three months ended June 30, 2025 compared to 75.8% for the three months ended June 30, 2024.

Current wording

Real Estate Agent Commissions. As a result of declines in our commissions and other brokerage income, as well as a decline in our commission expense as a percentage of revenues, our real estate agent commissions expense was $192,771 for the three months ended September 30, 2025 compared to $199,133 for the three months ended September 30, 2024, representing a decline of $6,362. Real estate agent commissions expense, as a percentage of revenues, decreased to 73.3% for the three months ended September 30, 2025 compared to 74.8% for the three months ended September 30, 2024. This percentage decline was primarily driven by improved margins from our Development Marketing division in the 2025 period.

Previous wording

Operating loss. Operating loss was $5,532 for the three months ended June 30, 2025 compared to $3,673 for the same period in 2024. The $1,859 increase in operating loss was primarily due to decreased revenues during the three months ended June 30, 2025.

Current wording

Operating loss. Operating loss was $10,655 for the three months ended September 30, 2025 compared to $7,431 for the same period in 2024. The $3,224 increase in operating loss was primarily due to an increase in general and administrative expenses of $3,561, which was primarily due to increases in legal and personnel expenses, and was partially offset by improved gross profit of $2,884 during the three months ended September 30, 2025.

Previous wording

Other (expense) income. Other expense was $17,093 for the three months ended June 30, 2025 compared to other income of $2,066 for the three months ended June 30, 2024. For the three months ended June 30, 2025, other expense primarily consisted of the $16,969 loss from changes in the fair value of the derivative embedded within convertible debt and interest expense of $1,545. These were partially offset by interest income of $1,259. For the three months ended June 30, 2024, other income primarily consisted of interest income of $1,055 and investment income associated with our PropTech investments of $1,020.

Current wording

Other income (expenses). Other expense was $14,276 for the three months ended September 30, 2025 compared to other expense of $20,018 for the three months ended September 30, 2024. For the three months ended September 30, 2025, other expense primarily consisted of the $15,445 loss from change in the fair value of the derivative embedded within convertible debt, partially offset by the $1,225 gain from the monetization of our remaining interest in Bilt Technologies in July 2025. For the three months ended September 30, 2024, other expense primarily consisted of the $20,166 loss from the change in fair value of derivative embedded within convertible debt.

Previous wording

Loss before provision for income taxes. Loss before income taxes was $22,625 and $1,607 for the three months ended June 30, 2025 and 2024, respectively.

Current wording

Loss before provision for income taxes. Loss before income taxes was $24,931 and $27,449 for the three months ended September 30, 2025 and 2024, respectively.

Previous wording

Income tax expense. There was no income tax expense for the three months ended June 30, 2025. Income tax expense was $173 for the three months ended June 30, 2024. Wecalculate our provision for income taxes based upon our estimate of the annual effective income tax rate based on full year projections and apply the annual effective income tax rate against year-to-date pretax income to record income tax expense, adjusted for discrete items, if any. We did not record a provision for income taxes during the three months ending June 30, 2025 because we have established a valuation allowance for the full amount of our deferred tax assets. During the three months ended June 30, 2024, we analyzed the likelihood of utilizing our deferred tax assets and determined it will be more likely than not that the benefits of these deductible differences will not be realized, and as a result we established a valuation allowance for the full amount of the deferred tax assets and recorded a charge of $503, which was offset by the income tax benefit computed at our effective income tax rate of $330. We refine annual estimates as current information becomes available.

Current wording

Income tax expense. Income tax expense was $11 for the three months ended September 30, 2025. There was no income tax expense for the three months ended September 30, 2024. Wecalculate our provision for income taxes for interim reporting periods based upon our estimate of the annual effective income tax rate based on full year projections, which does not include the impact of discrete items. We then apply the annual effective income tax rate against year-to-date pretax income to record income tax expense and then adjust our provision for income tax expense for any discrete items. Because we had established a full valuation allowance against our deferred tax assets as each of September 30, 2024 and September 30, 2025, there were no discrete items for either the three months ended September 30, 2025 or 2024.

Previous wording

The following table sets forth our revenue and operating loss for the six months ended June 30, 2025 compared to the six months ended June 30, 2024:

Current wording

The following table sets forth our revenue and operating loss for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024:

Previous wording

Revenues. Our revenues were $524,769 for the six months ended June 30, 2025 compared to $485,990 for the six months ended June 30, 2024. The $38,779 increase in revenues was primarily due to higher commissions and other brokerage income, driven by an increased number of transactions and higher transaction values from existing home sales in New York City, the Northeast and Florida markets, as well as an increase in revenue from Development Marketing division compared to the 2024 period.

Current wording

Revenues. Our revenues were $787,607 for the nine months ended September 30, 2025 compared to $752,306 for the nine months ended September 30, 2024. The $35,301 increase in revenues was primarily due to higher commissions and other brokerage income, driven by an increased number of transactions and higher transaction values from existing home sales in the Northeast region, as well as an increase in revenue from the Development Marketing division compared to the 2024 period.

Previous wording

Our revenues from commission and other brokerage income totaled $499,159 for the six months ended June 30, 2025, compared to $460,578 for the six months ended June 30, 2024, representing an increase of $38,581. In 2025, our commission and other brokerage income from existing homes sales increased by $9,230 in New York City, $7,578 in the Northeast region (excluding New York City) and $6,559 in the Florida market. Additionally, our revenues from Development Marketing increased by $17,701, primarily related to the Florida market during the 2025 period compared to 2024. This was offset by a decline in revenues in the West region of $2,487 in the 2025 period compared to the 2024 period.

Current wording

Our revenues from commission and other brokerage income totaled $749,513 for the nine months ended September 30, 2025, compared to $714,652 for the nine months ended September 30, 2024, representing an increase of $34,861. For the nine months ended September 30, 2025, our commission and other brokerage income from existing homes sales increased by $12,396 in the Northeast region (excluding New York City). Additionally, our revenues from Development Marketing increased by $17,223, primarily related to the Florida and New York City markets during the 2025 period compared to 2024.

Previous wording

Operating expenses. Our operating expenses were $535,650 for the six months ended June 30, 2025, compared to $531,127 for the six months ended June 30, 2024. The $4,523 increase was primarily due to higher real estate brokerage commissions of $25,646 resulting from increased revenues, partially offset by the $17,750 antitrust litigation settlement expense incurred in 2024.

Current wording

Operating expenses. Our operating expenses were $809,143 for the nine months ended September 30, 2025, compared to $804,874 for the nine months ended September 30, 2024. The $4,269 increase was primarily due to higher real estate brokerage commissions of $19,284 resulting from increased revenues, partially offset by the $17,750 antitrust litigation settlement expense incurred in 2024.

Previous wording

Real Estate Agent Commissions. As a result of increased commissions and other brokerage income, our real estate agent commissions expense was $391,119 for the six months ended June 30, 2025, compared to $365,473 for the six months ended June 30, 2024, representing an increase of $25,646. Real estate agent commissions expense as a percentage of revenues decreased to 74.5% for the six months ended June 30, 2025, compared to 75.2% for the six months ended June 30, 2024. This decline was primarily driven by a higher percentage of commission revenues derived from the Development Marketing division.

Current wording

Real Estate Agent Commissions. As a result of increased commissions and other brokerage income, which were partially offset by a decline in our commission expense as a percentage of revenues, our real estate agent commissions expense was $583,890 for the nine months ended September 30, 2025, compared to $564,606 for the nine months ended September 30, 2024, representing an increase of $19,284. Real estate agent commissions expense as a percentage of revenues decreased to 74.1% for the nine months ended September 30, 2025, compared to 75.1% for the nine months ended September 30, 2024. This decline in percentage was primarily driven by a higher percentage of commission revenues derived from the Development Marketing division.

Previous wording

Sales and Marketing. Sales and marketing expenses were $20,069 for the three months ended June 30, 2025 compared to $22,153 for the three months ended June 30, 2024. The decline in expenses is attributable to expense rationalization efforts to streamline our sales and marketing process.

Current wording

Sales and Marketing. Sales and marketing expenses were $59,519 for the nine months ended September 30, 2025, compared to $62,691 for the nine months ended September 30, 2024. The decline in expenses is attributable to expense rationalization efforts to streamline our sales and marketing process.

Previous wording

Operating loss. Operating loss was $10,881 for the six months ended June 30, 2025, compared to $45,137 for the six months ended June 30, 2024. The $34,256 decrease in operating loss was primarily due to increased revenues, partially offset by higher commission expenses and the $17,750 antitrust litigation settlement expense incurred in 2024.

Current wording

Operating loss. Operating loss was $21,536 for the nine months ended September 30, 2025, compared to $52,568 for the nine months ended September 30, 2024. The $31,032 decline in operating loss was primarily due to the absence of the $17,750 antitrust litigation settlement expense, which was incurred in 2024, as well as improved gross profit of $16,017 and was partially offset by an increase in general and administrative expenses of $5,192 in 2025.

Previous wording

Other (expense) income. Other expense was $18,028 for the six months ended June 30, 2025, compared to other income of $3,040 for the six months ended June 30, 2024. For the six months ended June 30, 2025, other expense primarily consisted of the $17,715 loss from changes in the fair value of the derivative embedded within convertible debt and interest expense of $3,075. These were partially offset by interest income of $2,620. For the six months ended June 30, 2024, other income primarily consisted of interest income of $2,438.

Current wording

Other income (expenses). Other expense was $32,304 for the nine months ended September 30, 2025, compared to other expense of $16,978 for the nine months ended September 30, 2024. For the nine months ended September 30, 2025, other expense primarily consisted of the $33,160 loss from the change in fair value of the derivative embedded within convertible debt and was offset by the $1,225 gain from the monetization of Bilt Technologies. For the nine months ended September 30, 2024, other expense primarily consisted of the $20,166 loss from the change in fair value of derivative embedded within convertible debt.

Previous wording

Loss before provision for income taxes. Loss before income taxes was $28,909 for the six months ended June 30, 2025, and $42,097 for the six months ended June 30, 2024.

Current wording

Loss before provision for income taxes. Loss before income taxes was $53,840 for the nine months ended September 30, 2025, and $69,546 for the nine months ended September 30, 2024 due to the factors described above.

Previous wording

Income tax expense. There was no income tax expense for the six months ended June 30, 2025. Income tax expense was $1,368 for the six months ended June 30, 2024. We calculate our provision for income taxes based upon our estimate of the annual effective income tax rate based on full year projections and apply the annual effective income tax rate against year-to-date pretax income to record income tax expense, adjusted for discrete items, if any. During the six months ended June 30, 2024, the we analyzed the likelihood of utilizing its deferred tax assets and determined it will be more likely than not that the benefits of these deductible differences will not be realized, and as a result we established a valuation allowance for the full amount of the deferred tax assets and recorded a charge of $9,021 and current period valuation allowance of $977, in addition to state income tax benefit of $8,630. We refine annual estimates as current information becomes available.

Current wording

Income tax expense. Income tax expense was $11 for the nine months ended September 30, 2025, compared to $1,368 for the nine months ended September 30, 2024. Wecalculate our provision for income taxes for interim reporting periods based upon our estimate of the annual effective income tax rate based on full year projections, which does not include the impact of discrete items. We then apply the annual effective income tax rate against year-to-date pretax income to record income tax expense and then adjust our provision for income tax expense for any discrete items. Because we had established a full valuation allowance against our deferred tax assets as each of September 30, 2024 and September 30, 2025, there were no discrete items for either the nine months ended September 30, 2025 or 2024. We refine annual estimates as current information becomes available.

Previous wording

As of June 30, 2025, DOUG Ventures had investments (at a carrying value) of approximately$11,496 in PropTech companies. This amounts to approximately 2% of the value of Douglas Elliman’s total assets, which totaled approximately $489 million as of June 30, 2025. In July 2025, we monetized our remaining investment in Bilt Technologies for $1,533 and will record a gain of $1,225 during the three months ended September 30, 2025.

Current wording

As of September 30, 2025, DOUG Ventures had investments (at a carrying value) of approximately$11,402 in PropTech companies. This amounts to approximately 2% of the value of Douglas Elliman’s total assets, which totaled approximately $481 million as of September 30, 2025. In July 2025, we monetized our remaining investment in Bilt Technologies for $1,533 and recorded a gain of $1,225 during the three months ended September 30, 2025.

Previous wording

Cash used in operations was $4,975 for the six months ended June 30, 2025, compared to $25,973 for the six months ended June 30, 2024. The decline in the cash used from operations in the 2025 period was attributable to a reduction in operating loss and lower liability payments (primarily cash bonuses) in the 2025 period, which were offset by the impact of increased development marketing closings in 2025 (which resulted in net realizations of contract assets and liabilities) as well as the absence of an income tax refund in the 2025 period.

Current wording

Cash provided by operations was $505 for the nine months ended September 30, 2025, compared to cash used in operations of $16,987 for the nine months ended September 30, 2024. The change in the cash activity from operations in the 2025 period was attributable to a reduction in operating loss and lower liability payments (primarily cash bonuses) in the 2025 period which were offset by the net impact of increased development marketing closings in 2025 as well as the absence of an income tax refund in the 2025 period.

Previous wording

Cash provided by investing activities was $7,548 for the six months ended June 30, 2025, compared to cash used in investing activities of $629 for the six months ended June 30, 2024. For the six months ended June 30, 2025, cash provided by investing activities was comprised of the proceeds from sale of short-term investments of $97,677 and proceeds from the sale of investments of $78 in our PropTech business. These inflows were partially offset by the purchase of short-term investments of $87,873, long-term investments of $83, and capital expenditures of $2,251. For the six months ended June 30, 2024, cash used in investing activities was comprised of capital expenditures of $2,967 and the purchase of long-term investments of $185 in our PropTech business. This was offset by $2,523 of distributions from our investments in equity securities.

Current wording

Cash provided by investing activities was $8,266 for the nine months ended September 30, 2025, compared to cash used in investing activities of $2,009 for the nine months ended September 30, 2024. For the nine months ended September 30, 2025, cash provided by investing activities was comprised of the proceeds from sale of short-term investments of $97,677 and proceeds from the sale of investments of $1,611 in our PropTech business. These inflows were partially offset by the purchase of short-term investments of $87,873, long-term investments of $108, and capital expenditures of $3,041. For the nine months ended September 30, 2024, cash used in investing activities was comprised of capital expenditures of $4,273 and the purchase of long-term investments of $259 in our PropTech business. This was offset by $2,523 of distributions from our investments in equity securities.

Previous wording

Cash used in financing activities was $85 for the six months ended June 30, 2025, compared to $11 for the six months ended June 30, 2024. For the six months ended June 30, 2025 and 2024, cash used in financing activities was comprised of withholding of shares as payment of payroll tax liabilities in connection with restricted stock vesting of $85 and $11, respectively.

Current wording

Cash used in financing activities was $85 for the nine months ended September 30, 2025, compared to cash provided by financing activities of $46,742 for the nine months ended September 30, 2024. For the nine months ended September 30, 2025, cash used in financing activities was comprised of withholding of shares as payment of payroll tax liabilities in connection with restricted stock vesting of $85. For the nine months ended September 30, 2024, cash provided by financing activities was comprised of proceeds from debt issuance of $48,750. This was offset by deferred financing charges of $1,997 and $11 for payroll tax liabilities associated with restricted stock withheld upon the vesting of restricted stock.

Previous wording

On July 2, 2024, we issued Convertible Notes due 2029 in the aggregate principal amount of $50,000. The Convertible Notes bear interest at a rate of 7.0% per annum, payable in cash, or, at our election, 8.0% per annum paid in kind, due semi-annually. For more information, see Note 7. “Notes Payable and Other Obligations” to our condensed consolidated financial statements.

Current wording

Convertible Notes. On July 2, 2024, we issued the Convertible Notes in the aggregate principal amount of $50,000 that bore interest at a rate of 7.0% per annum, payable in cash, or, at our election, 8.0% per annum paid in kind, due semi-annually. In connection with and upon consummation of the DEPM Sale, on October 24, 2025, we repaid and redeemed all of our Convertible Notes for an aggregate payment of $95,000, including approximately $1,400 of accrued interest. For more information, see Note 7, “Notes Payable and Other Obligations” to our condensed consolidated financial statements.

Previous wording

We continue to evaluate our capital structure and current market conditions related to our capital structure. We regularly review and evaluate potential acquisitions, joint ventures, divestitures, and other strategic transactions. For example, we may acquire, or seek to acquire, additional operating businesses through a merger, purchase of assets, stock acquisition or other means, or to make other revisions to our capital structure, including, if authorized by our Board of Directors and holders of our Convertible Notes, the repurchase of our common stock in open market transactions. These initiatives may limit our liquidity otherwise available.

Current wording

We continue to evaluate our capital structure and current market conditions related to our capital structure. We regularly review and evaluate potential acquisitions, joint ventures, divestitures, and other strategic transactions. For example, we may acquire, or seek to acquire, additional operating businesses through a merger, purchase of assets, stock acquisition or other means, or to make other revisions to our capital structure, including, if authorized by our Board of Directors, the repurchase of our common stock in open market transactions. These initiatives may limit our liquidity otherwise available.

Previous wording

We had cash and cash equivalents of approximately $136,334 as of June 30, 2025 and, in addition to any cash provided from operations, such cash is available to be used to fund such liquidity requirements as well as other anticipated liquidity needs in the normal course of business. Management currently anticipates that these amounts, together with expected cash flows from our operations and proceeds from any available financings, should be sufficient to meet our liquidity needs over the next twelve months. We may acquire or seek to acquire additional operating businesses through mergers, asset purchases, stock acquisitions, or other means, or pursue other investments, which could limit the liquidity otherwise available to us.

Current wording

We had cash and cash equivalents of approximately $143,003 as of September 30, 2025 and, in addition to any cash provided from operations, such cash is available to be used to fund such liquidity requirements as well as other anticipated liquidity needs in the normal course of business. Management currently anticipates that these amounts, together with expected cash flows from our operations and proceeds from any available financings, should be sufficient to meet our liquidity needs over the next twelve months. We may acquire or seek to acquire additional operating businesses through mergers, asset purchases, stock acquisitions, or other means, or pursue other investments, which could limit the liquidity otherwise available to us.