Company: LRHC
Filing Date: 2025-11-19
Form Type: 10-Q
Source: 0001213900-25-112656
Chunk: 85

Company: La Rosa Holdings Corp.
Filing Date: 2025-11-19
Form: 10-Q
Item: Item 1
Chunk 85
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, with the majority of our revenue derived from commissions paid by consumers who transact business with our and our franchisees’
agents, royalties paid by our franchisees, dues and technology fees paid by our sales agents, our franchisees, and our franchisees’
agents. Our major revenue streams come from such sources as: (i) residential real estate brokerage revenue, (ii) revenue from our property
management services, (iii) franchise royalty fees, (iv) fees from the sale or renewal of franchises and other franchise revenue, (v)
coaching, training and assistance fees, (vi) brokerage revenue generated transactionally on commercial real estate, (vii) fees generated
from title services revenue and insurance and (viii) fees from our events and forums. 

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The
majority of our revenue is derived from fees and dues based on the number of agents working under the La Rosa Realty brand. Due to the
low fixed cost structure of both our Company and franchise models, the addition of new sales agents generally requires little incremental
investment in capital or infrastructure. Accordingly, the number of commission producing sales agents in our Company and our franchisees
is the most important factor affecting our results of operations and the addition of new agents can favorably impact our revenue and
our earnings before interest, taxes, depreciation and amortization (“EBITDA”). Historically, the number of agents in the
residential real estate industry has been highly correlated with overall home sale transaction activity. We believe that the number of
agents and those that produce commissions in our network is the primary statistic that drives our revenue. Another major factor is the
cyclicality of the real estate industry that has peaks and valleys depending on macroeconomic conditions that we cannot control. And
finally, our revenues fluctuate based on the changes in the aggregate fee revenue per sales agent as a significant portion of our revenue
is tied to various fees that are ultimately tied to the number of agents, including annual dues, continuing franchise fees, and certain
transaction or service-based fees. Our revenue per agent also increases in other ways including when transaction sides and transaction
sizes increase since a portion of our revenue comes from fees tied to the number and size of real estate transactions closed by our agents.
While the Company was not named as a defendant in any of the recent class action lawsuits alleging antitrust violations, it is possible
that it could be a litigant at some point in the future. Several of these lawsuits have been settled (see our