La Rosa Holdings Corp (NASDAQ: LRHC) delivered impressive third-quarter 2024 financial results, signaling robust growth and a strategic expansion within the real estate sector. The company reported a remarkable 188% year-over-year increase in total revenue, reaching $19.6 million for the quarter ended September 30, 2024. This significant jump is largely attributed to the company’s aggressive acquisition strategy and increased pricing.
Residential real estate services were the primary driver of this growth, experiencing a staggering 328% surge to $16.5 million in revenue. This substantial increase reflects the impact of thirteen acquisitions completed since the company’s initial public offering (IPO) in October 2023, including six in Q4 2023 and seven in the first nine months of fiscal year 2024. These acquisitions have significantly expanded La Rosa’s market presence and agent network. Furthermore, the company implemented a price increase on transaction, monthly agent, and annual fees effective September 1, 2023. Management projects that if transaction volumes return to 2023 levels, this fee increase alone will significantly boost revenue in 2024, even excluding the revenue from acquisitions.
While revenue skyrocketed, the company also experienced increased operating expenses. Selling, general, and administrative costs (excluding stock-based compensation) reached approximately $3.0 million, up from $0.99 million in the same period last year. A considerable portion of this increase—$1.1 million—is directly related to the costs associated with the thirteen acquisitions completed since the IPO. Additional factors contributing to increased expenses included higher payroll and benefits, insurance and training costs, and the expenses associated with becoming a publicly traded company. Despite these increased costs, La Rosa’s aggressive growth strategy showcases the company’s focus on market domination.
The company reported a net loss of $3.4 million, or 21 cents per share, for the third quarter, compared to a net loss of $0.34 million, or 6 cents per share, in the year-ago quarter. However, this loss is understandable given the significant investments made in acquisitions and expansion. The substantial increase in revenue strongly suggests that the company is on a path towards profitability.
La Rosa Holdings continues to strengthen its position in the real estate market. Beyond the multiple brokerage acquisitions, the company finalized the purchase of Nona Title Agency, rebranded as Red Door Title. This acquisition expands La Rosa’s service offerings by providing title insurance, creating a seamless end-to-end experience for clients and establishing a high-margin revenue stream with potential for significant growth in 2025. Moreover, the company announced plans to acquire another large real estate brokerage firm boasting over 950 agents and $19 million in 2023 revenue. Simultaneously, the company successfully restructured its debt, improving its overall financial stability and reducing note liabilities by roughly 9.5%.
Looking ahead, La Rosa Holdings projects an impressive annualized revenue run rate of $100 million by the end of 2024. This projection reflects the company’s confidence in its operational scaling, diversified revenue streams, and successful integration of new agents. The company anticipates achieving profitability by 2025, fueled by cost discipline, technological advancements, and a commitment to agent and customer satisfaction. LRHC stock closed Tuesday at $0.7590, up 2.36%. This positive market reaction underscores investor confidence in La Rosa’s growth trajectory and potential for future success.
