La Rosa Holdings Corp. (LRHC)·Q1 2025 Earnings Summary

Executive Summary

• Q1 2025 revenue was $17.514M (+34% YoY), with gross profit of $1.538M (+32% YoY), driven by 39% growth in residential real estate services; property management grew 17% and commercial nearly doubled off a small base .
• GAAP net loss widened to $(95.7)M (EPS $(5.86)), primarily due to a non‑cash $128.8M loss on issuance of a senior secured convertible note, partially offset by $37.1M mark‑to‑market gains on the note and warrants and a $0.9M derivative liability fair value gain .
• Management emphasized organic growth (agent network >2,800 as of 4/30/25) and said Q2 is tracking ahead of last year; FY2025 revenue forecast of $100M (first communicated April 16) remains intact post‑Q1 .
• Balance sheet optics deteriorated: derivative liability jumped to $81.36M current, flipping to a stockholders’ deficit of $(83.38)M; management plans to restructure warrant‑related derivatives as part of a treasury strategy, a key catalyst for sentiment if executed .

What Went Well and What Went Wrong

• What Went Well

  • Strong top-line expansion in a seasonally slower quarter: revenue +34% YoY to $17.5M; gross profit +32% YoY to $1.5M .
  • Residential services +39% YoY ($14.3M); property management +17% ($3.0M); commercial brokerage nearly doubled to $57K .
  • “With the second quarter already tracking ahead of last year’s pace, we are confident in our ability to deliver continued growth” — CEO Joe La Rosa; agent network >2,800 as of 4/30/25 .

• What Went Wrong

  • Massive GAAP loss from capital structure actions: $(95.7)M net loss (EPS $(5.86)) tied to $128.8M non‑cash loss on issuance of a senior secured convertible note; only partly offset by fair‑value gains .
  • Operating loss remained elevated at $(4.668)M as opex (ex‑SBC) rose to ~$4.3M vs $2.6M YoY on growth and public-company investments .
  • Balance sheet headwinds: current derivative liability surged to $81.36M; stockholders’ equity swung to a $(83.38)M deficit; current notes payable rose to $15.444M, underscoring financing risk until the planned restructuring is executed .

Financial Results

Segment revenue breakdown:

KPIs and footprint:

Notes:

• Q4 2024 detail beyond revenue not disclosed in the April 16 press release; full quarterly P&L line items were not provided in that document .

Guidance Changes

Earnings Call Themes & Trends

(Company did not furnish an earnings call transcript in our document set; themes reflect recent disclosures/press releases.)

Management Commentary

• “Total revenue grew 34% year-over-year to $17.5 million, and gross profit increased 32% to $1.5 million… achieving this level of growth during a seasonally slower period reflects the strength of our platform and the disciplined execution of our organic growth strategy.” — CEO Joe La Rosa .
• “As of April 30, 2025, our agent network has grown to over 2,800 agents nationwide… With the second quarter already tracking ahead of last year’s pace, we are confident in our ability to deliver continued growth” .
• “A significant portion of [the] loss is driven by non-cash and one-time items, primarily related to the change in fair value of our warrant‑related derivative liabilities… we intend to take proactive steps to restructure them… ultimately contributing to improved net income and shareholder equity” .
• “Outstanding performance from our Celebration and BF Prime offices… Celebration revenue +86% YoY to $3.4M; BF Prime revenue +268% vs Q4’24 to $98K” .
• FY posture into 2025 (pre‑Q1): “Revenue for 2025 revenue for $100 Million remains intact… focused on achieving profitability in 2025” .

Q&A Highlights

• No Q1 2025 earnings call transcript was available in our document set; no Q&A items to report from company‑furnished sources.

Estimates Context

• S&P Global consensus: Not available for Q1 2025 EPS and revenue; therefore, a “vs. estimates” comparison is not possible this quarter. Values retrieved from S&P Global.
• Actuals for reference: Revenue $17.514M; EPS $(5.86) (GAAP) .

Key Takeaways for Investors

• Growth durability with mix: Residential remains the engine (+39% YoY) while property management provides steadier contribution (+17% YoY); commercial brokerage is small but improving .
• Capital‑structure overhang dominated GAAP results; the planned restructuring of warrant‑related derivatives is the key swing factor for equity and earnings optics in 2025 .
• Balance sheet risk is visible (current derivative liability $81.36M; equity deficit $(83.38)M); watch follow‑through on treasury actions and liquidity management (current notes payable $15.444M) .
• Momentum into Q2 appears positive (“tracking ahead”), and FY2025 revenue target of $100M was maintained; execution on agent expansion and franchise leverage should support the trajectory .
• Regional proof points (Celebration, FL; BF Prime, PR) demonstrate operational scaling and community penetration that can translate to broader network gains in 2025 .
• Cost discipline remains a work‑in‑progress as growth investments lift opex; path to profitability hinges on scaling revenue, ancillary services (e.g., title), and managing public‑company costs .
• Trading lens: Near‑term stock reaction likely tied less to revenue prints and more to clarity/timing on derivative liability restructuring and financing terms; updates there could reset sentiment materially .