Company: LRHC
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001213900-25-032211
Chunk: 2092

Company: La Rosa Holdings Corp.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 7
Chunk 2092
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0% 

    Total Gross Profit 
    $5,953,279  
    $2,841,168  
    $3,112,111  
     110%
  
    Total Gross Margin 
     8.6% 
     8.9% 
     -0.4% 

Real Estate Brokerage Services (Residential)

Costs related to residential
real estate brokerage services increased $3.654 million, or 217%, in the year ended December 31, 2024 against the comparable prior year
period. The increase was driven in part by $8,945 million of cost of revenue from the seven acquisitions completed during fiscal year
2024. In addition we saw a full year impact from the six acquisitions from the 4th Quarter of 2023. The gross profit increased
$3.654 million, or 216.7%, from 2023 to 2024 primarily attributable to the fee increases enacted in September of 2023 and gross profit
from acquisitions. Due to these factors our gross margin increased to 9.4% compared to our 2023 gross margin of 8.2%.

Franchising Services

The Company uses external
software that supports the Company’s franchises, which is directly used to manage real estate transactions that generates revenue.
The software is classified as a cost of revenue, and the Company expects to continue to use the software for a significant portion of
2025, with internally developed options coming online in the latter half of 2025. The decrease in cost of franchising revenue is due to
the six acquisitions from 2023 and six from 2024, which no longer contribute to the cost of franchising revenue, as well as a reduction
of price per usage of the software costs based on our review of usage of the software in 2023. The gross profit decreased $570 thousand,
or 138.7%, from 2023 to 2024 primarily attributable to the reduction in the cost of revenue.

Coaching Services

Costs related to coaching
services decreased $20 thousand, or 6.1%, in the year ended December 31, 2024 against the comparable prior year period. Costs related
to coaching services moved proportionally with the change in related revenue. Gross profit decreased by $40 thousand, or 13.5%, due to
new initiatives to drive recruiting which impacted coaching programs.

Property Management

Costs related to property
management services increased $