Quarterly Report for Quarter Ending June 30, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and related notes included elsewhere in this report, as well as our audited financial statements and related notes included in our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2025 (the "Form 10-K"). In addition to historical information, this discussion and analysis here and throughout this report contains forward-looking statements that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements due to a number of factors, including but not limited to, the risks described in the section titled "Risk Factors" in our Form 10-K.

Overview

We are a real estate technology company developing an end-to-end homebuying platform, which we have named reAlpha (hereinafter referred to as the "reAlpha platform"). Our goal is to offer, through our AI-powered platform, a more affordable, streamlined experience for those on the journey to homeownership. The reAlpha platform integrates AI-driven tools to offer, among others, tailored property recommendations, an intuitive visual interface, and certain services, including realty services, mortgage brokering services, and digital title and escrow services within the platform.

Our revenue model revolves around: (i) our homebuying services, which include realty services (e.g., assisting a homebuyer with finding, touring, and closing on homes), mortgage brokering services (e.g., finding and originating a mortgage for the homebuyer that fits their financial situation, needs, credit, and location), and digital title and escrow services (e.g., title, closing and settlement fees) directly to customers, mainly through the reAlpha platform, and (ii) our technology services, including software development services provided by our subsidiaries Naamche, Inc. ("U.S. Naamche") and Realpha Nepal Pvt. Ltd. (f/k/a Naamche, Inc. Pvt. Ltd.) ("reAlpha Nepal Pvt Limited" and together with U.S. Naamche, "reAlpha Nepal") to businesses and the AI-powered conversational platform provided to customers by our subsidiary, AiChat Pte. Ltd. ("AiChat").

We are continuously working to commercialize, enhance and refine our AI technologies to support our homebuying services and technology services and to continue generating revenue. As part of our growth strategy, we also plan to continue identifying and acquiring companies that are complementary to our business, and we intend to generate revenue from integrating such acquired companies and their capabilities into our business. To advance such strategy, we have, in recent years, announced the acquisitions of reAlpha Nepal, AiChat, Hyperfast Title LLC ("Hyperfast"), Debt Does Deals, LLC (f/k/a Be My Neighbor and d/b/a reAlpha Mortgage) ("reAlpha Mortgage") and Prevu, Inc. and its subsidiaries (collectively, "Prevu"), as well as the proposed acquisition of InstaMortgage Inc. ("InstaMortgage"), which would expand our mortgage operations by adding direct lending capabilities.

Before shifting our focus towards the development of our homebuying services and technology services, our operational model was asset-heavy and built on utilizing our proprietary AI-powered technology tools for the acquisition of real estate, converting them into short-term rentals, and enabling individual investors to acquire fractional interests in these real estate properties, allowing such investors to receive distributions based on the properties' performance as a short-term rental. In the first quarter of 2024, we decided to halt these operations due to macroeconomic conditions, such as higher interest rates, inflation, and elevated property prices, which conditions persisted throughout the fiscal year 2024. This led us to sell our last real property asset for such operations, and to recognize the impairment of goodwill and intangible assets under the rental business segment. As a result, in the first quarter of 2025, our Board approved the discontinuation of our short-term rental business operations entirely and this discontinuation meets the criteria for being reported as discontinued operations. We currently have two reportable segments: our homebuying services segment and our technology services segment.

Description of Our Segments

Homebuying Services

Our homebuying services segment consists of our (i) realty services offered by Prevu and our reAlpha Realty, LLC entities (collectively, "reAlpha Realty"); (ii) mortgage brokering services offered by reAlpha Mortgage and (iii) digital title and escrow services offered by Hyperfast. These services are mainly provided through the reAlpha platform, which supports homebuyers with key tasks such as booking property tours, submitting offer letters, mortgage pre-approval and closing transactions. It also provides detailed market insights and comprehensive property data tailored to users' areas of interest.

We seek to differentiate ourselves from competitors primarily through the vertical integration of homebuying services (real estate brokerage, mortgage brokering, title and escrow services) within a single platform; the integration of AI into our homebuying services offerings and our rebate, which is further described below. We have integrated AI into our homebuying services offerings through our development of "Claire," a proprietary, customer-facing AI-powered agent acting as a digital homebuying concierge, and internal AI-powered tools for our loan officers. "Claire" is powered by large language models and provides real-time customer support by answering questions and guiding customers through each step of the homebuying journey through a user-friendly, 24/7 web and iOS interface. "Claire" is complemented by licensed professionals, namely real estate agents and loan officers, who step in when their expertise is needed.

In addition to "Claire," we use AI-powered internal tools, such as our proprietary AI-powered "Loan Officer Assistant," which is intended to reduce manual review time for our loan officers, and the AI-powered "Engagement Agent," which integrates with our customer relationship management system to automate certain intake and scheduling and other pre-application workflows for our loan officers. The "Loan Officer Assistant" automates key loan origination tasks, such as document collection and borrower communication and is designed to help loan officers manage higher volumes with greater efficiency while the "Engagement Agent" is designed to accelerate prospective borrower's connection to loan officers for personalized support, improve prospective borrower engagement and reduce repetitive administrative work related to the intake, follow-up and scheduling processes.

As part of our strategy to differentiate ourselves from competitors and provide a customer-centric homebuying experience, we offer a rebate to homebuyers using the reAlpha platform.

Under our current rebate structure, homebuyers can receive a rebate of up to 1.0% of the home purchase price when using our realty services and an additional rebate of up to 0.5% of the home purchase price when bundling the mortgage brokering services with our realty services, in each case subject to the limitations, terms and conditions described in the buyer agreement (the "current commission rebate"). The current commission rebate is paid to the homebuyer as a rebate towards closing costs, which is reflected on the settlement statement at closing.

Prior to the implementation of the current commission rebate in mid-January 2026, we offered a rebate whereby eligible homebuyers could receive up to 75% of the buy-side brokerage commission paid in connection with the purchase of a home through the reAlpha platform as a rebate towards closing costs, subject to market-specific commissions and minimums (the "historic commission rebate"). The buy-side brokerage commission was dependent on the geographical market of the home purchased and the percentage of the historic commission rebate available to a homebuyer was determined based on their use of eligible integrated services offered via the reAlpha platform, such as realty, mortgage brokering, and digital title and escrow services. Under this model, homebuyers could receive a 25% rebate when using only realty services, 50% when using two services and 75% when using all three services. The update to the current commission rebate in mid-January 2026 was designed to make the rebate easier for customers to understand.

Currently, all three services (realty, mortgage brokering, and title services) are only available on the reAlpha platform for homebuyers in Florida and Virginia. However, two of the three services are offered to homebuyers in eight additional U.S. states, and at least one service is available in an additional 25 U.S. states and the District of Columbia. While our homebuying services are currently offered in 35 U.S. states and the District of Columbia, we plan to offer our homebuying services (and expand the capabilities of the reAlpha platform) nationwide, subject to factors such as acquiring and maintaining necessary real estate and mortgage licenses in each U.S. state and the District of Columbia, securing additional multiple listing service data, executing effective national marketing campaigns and building scalable technology infrastructure.

Technology Services

Our technology services segment includes: (i) software development services provided to third-party customers by reAlpha Tech Corp.; (ii) software development and other technology support services provided by reAlpha Nepal to us under an intercompany services agreement; and (iii) the AI-powered conversational platform provided to customers by AiChat. We expect that our technology services segment will benefit from the current growth of the AI industry, and we believe that we are well-positioned to take advantage of these current trends due to our early adoption of AI for the development of our technologies.

reAlpha Nepal's Software Development Services

reAlpha Nepal provides services related to the development of technology, AI and applications, as well as other technology support to the reAlpha platform and to third parties. For example, reAlpha Nepal developed the Company's AI-powered tools such as the proprietary, customer-facing "Claire" and our internal AI-powered "Loan Officer Assistant" and "Engagement Agent."

AiChat's Conversational Platform

AiChat provides AI-powered conversational customer experience platforms in the Asia-Pacific ("APAC") region. AiChat's conversational platform enables businesses to automate and optimize customer service, marketing, and e-commerce processes through the integration of major messaging channels in the APAC region, including Facebook Messenger, WhatsApp, Instagram, LINE, and KakaoTalk. AiChat also offers customers the ability to integrate their e-commerce platforms with payment gateways, which is powered by Stripe's financial infrastructure, enabling them to sell products via messaging channels such as WhatsApp Pay directly to their customers. Through these capabilities, AiChat is able to offer customers a comprehensive array of customer service solutions, ranging from customer inquiry and AI-powered recommendations via its AI agents and chatbot capabilities, to completing the purchase through WhatsApp.

AiChat's technology is built on conversational and generative AI models, supporting over 270 languages, including regional languages like Singlish and Bahasa. The conversational platform incorporates features such as contextual memory, real-time analytics, and personalized messaging to facilitate customer interactions. Key functionalities of the platform include automated responses, lead qualification, and customer engagement automation. Further, its recently released next-generation AI agents, which include Voice AI and Agentic AI, can provide human-like interactions and personalize responses based on the context of previous conversations, remembering customer preferences and past interactions to deliver more relevant recommendations. With self-learning and multi-turn contextual awareness, AiChat's next-generation AI agents can scale human-like interactions while maintaining brand consistency, which we believe can improve customer loyalty and overall customer service satisfaction.

AiChat generates revenue through subscription packages of its conversational platforms and next-generation AI agents. These packages are tailored to businesses based on their size, needs and the volume of customer interactions. AiChat offers flexible pricing models, including monthly and annual subscriptions, as well as performance-based pricing for specific integrations and services, such as automated marketing campaigns and e-commerce automation.

Recent Developments

Proposed Merger with InstaMortgage Inc.

On December 19, 2025, we entered into the Merger Agreement (the "Merger Agreement") with InstaMortgage, reAlpha Merger Sub I, Inc. ("Merger Sub"), a newly formed wholly-owned subsidiary of the Company, and the stockholders of InstaMortgage (the "Stockholders"). The Merger Agreement provides that, among other things and on the terms and subject to the satisfaction or waiver of the closing conditions and other conditions set forth therein, Merger Sub will merge with and into InstaMortgage at the effective time (the "Effective Time") of the proposed merger (the "Proposed Merger"), with InstaMortgage surviving the Proposed Merger as a wholly-owned subsidiary of the Company.

Pursuant to the terms and conditions of the Merger Agreement, we agreed to pay the Stockholders an aggregate amount of $8,500,000, subject to certain closing adjustments, consisting of: (i) $500,000 in cash to be paid on the closing date of the Proposed Merger, less any applicable withholding tax payable by the Stockholders in accordance with the terms of the Merger Agreement; (ii) $1,500,000 in shares of our common stock to be issued on the closing date of the Proposed Merger and valued based on the volume-weighted average price ("VWAP") of our common stock as reported on Nasdaq for the ten (10) consecutive trading day period ending on and including the trading day that is one (1) trading day prior to the date of the Merger Agreement; and (iii) $6,500,000 payable in bi-annual payments over three (3) years following the closing date of the Proposed Merger, either in cash or shares of common stock (the "Additional Payment Purchaser Stock"), at our sole discretion, with such Additional Payment Purchaser Stock, if any, valued based on the VWAP of our common stock as reported on Nasdaq, for the ten (10) consecutive trading days ending on the date immediately prior to the date on which such issuance is to be made.

Under the terms of the Merger Agreement, the completion of the Proposed Merger is subject to the satisfaction or waiver of certain customary closing conditions, including, among others, the receipt of the Regulatory Approvals (as defined in the Merger Agreement), in each case subject to certain limitations further described in the Merger Agreement. The Proposed Merger is targeted to close by the end of August 2026, subject to Regulatory Approvals and other customary closing conditions

Reverse Stock Split

On May 20, 2025, we received a deficiency letter from Nasdaq notifying us that our common stock had failed to maintain the minimum $1.00 closing bid price required for continued listing under Nasdaq Listing Rule 5550(a)(2). On March 30, 2026, the Board approved a 1-for-25 reverse stock split of our issued and outstanding shares of common stock, which was previously approved by our stockholders at the 2025 annual meeting of stockholders. Subsequently, we filed an amendment to our certificate of incorporation with the Secretary of State of Delaware on April 28, 2026, pursuant to which the Reverse Stock Split became effective on April 30, 2026. On May 14, 2026, we received written confirmation from Nasdaq notifying us that we have regained compliance with Nasdaq Listing Rule 5550(a)(2).

In connection with the Reverse Stock Split, we also filed an amendment to the Certificate of Designation with the Secretary of State of Delaware on, which became effective immediately upon filing, which amended the formula set forth in the Certificate of Designation for the adjustment of the conversion price of the Series A Preferred Stock upon any stock dividend, subdivision or combination of the Company's outstanding shares of common stock, including in connection with the Reverse Stock Split.

Impact of Macroeconomic Conditions, Cyclicality and Seasonality on our Business

U.S. inflation remained above the Federal Reserve's stated 2% target during the second quarter of 2026, increasing 3.5% over the year ended in June 2026, down from 4.2% over the year ended May 2026. In response to continued inflationary pressures, the Federal Reserve held the target federal funds rate steady at a range of 3.5% to 3.75% at both its April and June 2026 meetings. The Federal Reserve also noted that uncertainty around the economic outlook remained elevated, partly due to geopolitical developments in the Middle East.

Mortgage rates remained elevated during the second quarter of 2026, with the average 30-year fixed mortgage rate remaining near the mid-6% range in June 2026. Elevated borrowing costs, combined with elevated home prices and constrained housing inventory, have continued to affect affordability and home purchase activity. These factors, along with macroeconomic uncertainty, have contributed to mixed transaction volumes across the housing market. For example, in June 2026, existing-home sales in the U.S. increased 2.8% year-over-year to a seasonally adjusted annual rate of 4.09 million, while single-family home sales increased 3.3% year-over-year to a seasonally-adjusted annual rate of 3.73 million.

The residential real estate market is cyclical, with performance influenced by macroeconomic trends, interest rates, credit availability, lending standards and major disruptions in economic or political environments. Local markets may follow different patterns than national trends, leading to regional variations in activity. In addition, transaction volumes follow seasonal patterns, typically peaking in the spring and summer and slowing in the fall and winter. These cyclical and seasonal dynamics, together with prevailing macroeconomic conditions, can create variability in our operating results from quarter to quarter.

Management continues to evaluate the potential effects of current housing market conditions, interest rate trends, and seasonal factors on our operations. The extent of any impact will depend on future developments, including changes in macroeconomic conditions, housing demand, and regulatory or policy actions, all of which are inherently uncertain and difficult to predict. We may adjust elements of our strategy, cost structure, or operational focus in response to these developments to mitigate potential adverse effects and position the business for long-term objectives.

Key Business Metrics

We monitor a number of key performance indicators and non-U.S. GAAP financial measures to evaluate the performance of our business operations and the execution of our strategy. These metrics provide management with insight into transaction activity across our platform, operating efficiency, and trends affecting the scale and overall health of our business. We use these measures, together with our financial results, to assess performance across periods, inform management decision-making, and support financial planning and strategic priorities.

		Six Months Ended
		June 30,				June 30,
		2026				2025
Total transaction volume		$	150,368,178			$	88,388,063
Revenue		$	1,951,406			$	2,178,016
Cash and cash equivalents		$	2,230,607			$	587,311
Gross profit margin			66	%			52	%
Net loss		$	(7,387,812	)		$	(7,667,902	)
Adjusted EBITDA		$	(6,066,798	)		$	(5,625,233	)

Total Transaction Volume

Total transaction volume is a key measure of the operational scale of our homebuying services offerings, and a key indicator of the reAlpha platform's capacity and scalability that supports our revenue and drives expansion across our homebuying services segment. We define total transaction volume as the aggregate dollar volume of transactions generated across our real estate brokerage, mortgage, and title services during the applicable trailing twelve-month period. This includes (i) the closing sale prices of residential properties transacted through our realty services, (ii) the principal loan amounts closed through our mortgage brokerage operations, and (iii) the underlying property transaction value associated with title services provided during the period. We present total transaction volume on a trailing twelve-month basis to provide a view of transaction activity that smooths seasonal fluctuations and reflects the overall economic throughput of our platform. Total transaction volume is influenced by transaction activity across our business, home prices in the markets we serve, mortgage origination activity, service adoption rates, seasonality, and macroeconomic conditions, including interest rate levels and housing affordability. Management believes total transaction volume is useful in understanding period-over-period changes in transaction activity, evaluating the effectiveness of our agent network and marketing initiatives and assessing the overall health and growth trajectory of our business.

For realty transactions, we include the full closing sale price for each transaction, regardless of whether our brokerage represented the buyer, the seller, or both sides of the transaction, in accordance with applicable laws and disclosure requirements. Since customers may utilize more than one of our services in connection with a single underlying property transaction, the same property transaction value may be included in more than one component of total transaction volume. As a result, total transaction volume may exceed the dollar value of unique underlying residential property transactions completed during the period. This metric also excludes rental transactions that may be offered by Prevu to customers from time to time, which are not material to our operations.

Further, although our revenue is primarily generated as a percentage of total transaction volume, it does not directly correspond to revenue recognized in the period. As such, total transaction volume is not a measure of revenue and is not directly comparable to revenue recognized during the six months ended June 30, 2026. Total transaction volume reflects the full value of the underlying transactions generated during the applicable trailing twelve-month period, whereas revenue reflects only the commissions, fees and other amounts recognized during the applicable six-month financial reporting period. The relationship between total transaction volume and revenue may also vary depending on the mix of services provided, the timing of revenue recognition, customer adoption of multiple services and applicable fee arrangements. Accordingly, changes in total transaction volume may not correspond directly or proportionately with changes in revenue and it should not be viewed as a measure or predictor of revenue for any particular financial reporting period.

As of June 30, 2026, our total transaction volume, measured on a trailing twelve-month basis, increased to approximately $150.4 million, or approximately a 70% increase, compared to June 30, 2025, which increase was primarily driven by the expansion, scaling and full integration of reAlpha Mortgage's mortgage brokerage operations into our business, as well as the expansion of our real estate brokerage footprint and integrated realty-and-mortgage service coverage following the acquisition of Prevu. The increase in total transaction volume did not result in a proportionate increase in revenue, primarily due to the mix of services contributing to transaction volume, including the impact of Prevu following its acquisition in November 2025.

Revenue

Revenue represents income earned from services provided across our homebuying services and technology services segments. We generate revenue primarily from real estate brokerage commissions, mortgage brokerage fees, and other service-related revenues, which are recognized in accordance with U.S. GAAP. For more information regarding our discussion of revenue, see "Results of Operations" below.

For the six months ended June 30, 2026, revenue was $1,951,406, compared to $2,178,016 for the six months ended June 30, 2025, representing a decrease of approximately 10%.

Management evaluates revenue growth as an indicator of transaction activity across our platform and the effectiveness of our integrated service offerings. Revenue is influenced by transaction volume, customer adoption of multiple services, home prices in the markets we serve, mortgage origination activity, and prevailing market conditions, including interest rate levels and housing affordability.

Cash and cash equivalents

Cash and cash equivalents represent our primary source of liquidity and include unrestricted cash and highly liquid investments available to fund our operations and support strategic initiatives. Management monitors cash and cash equivalents to assess our liquidity position, working capital needs, and ability to support ongoing operations, platform development, and market expansion activities.

Cash and cash equivalents are influenced by operating performance, timing of transaction activity, capital raising activities, debt service requirements, and investments in technology, research and development, and acquisitions. As of June 30, 2026, cash and cash equivalents were $2,230,607, higher than the balance as of June 30, 2025 but lower than the $7,783,529 as of December 31, 2025, reflecting significant operating cash burn during the current period.

Gross profit margin

Gross profit margin represents gross profit as a percentage of revenue and reflects the efficiency of our operations after direct costs associated with delivering our homebuying services and technology services.

Management evaluates gross profit margin as an indicator of operating efficiency and unit economics across our services. Gross profit margin is influenced by service mix, total transaction volume, pricing dynamics, compensation and commission structures, and costs associated with operating and supporting our platform, including technology and service delivery expenses.

In the six months ended June 30, 2026, our gross profit margin increased to approximately 66% from 52% in the six months ended June 30, 2025. This increase in gross profit margin was mainly a result of lower cost of revenues, which was primarily due to the rescission of the GTG Financial and the absence of the cost of operations from GTG Financial, which had historically incurred higher cost of revenues than our other operating subsidiaries, and the increase in subscription-related revenue from AiChat's platform, which also carries higher gross profit margins than our real estate and mortgage operations, resulting in an overall higher profit gross margin for the current period.

Net loss

Net loss represents loss from continuing operations before tax. Management uses this measure to evaluate our underlying business performance and to plan and forecast its operations.

In the six months ended June 30, 2026, our net loss, narrowed by approximately 4% to $(7,387,812), compared to $(7,667,902) for the six months ended June 30, 2025. This change was primarily a result of lower marketing and advertising expenses, driven by reduced non-cash marketing expense recognized in connection with the MMC media-for-equity transaction, as well as lower professional and legal fees following the absence of prior-year costs associated with financing and capital-raising activities. This decrease was partially offset by higher wages, benefits and payroll taxes resulting from increased headcount following our recent acquisition, as well as restructuring costs incurred in connection with a reduction in force implemented during the current period. For additional discussion regarding the drivers of the period-over-period change, see "Results of Operations" below.

Adjusted EBITDA

We use Adjusted EBITDA, a non-U.S. GAAP financial measure, to evaluate our operating performance and facilitate comparisons across periods and with peer companies. We reconcile our Adjusted EBITDA to our net income (loss) adjusted to exclude interest expense, depreciation and amortization, changes in fair value of contingent consideration and preferred stock, share-based compensation, and other non-cash, non-operating, or non-recurring items that we believe are not indicative of our core business operations. We believe this measure provides useful insight into our ongoing performance; however, it should not be considered a substitute for, or superior to, net income or other financial information prepared in accordance with U.S. GAAP. For more information about how we use this non-GAAP financial measure in our business, the limitations of this measure, and reconciliation of this measure to the most directly comparable GAAP financial measure, see the section titled "Non-GAAP Financial Measures" below.

In the six months ended June 30, 2026, our Adjusted EBITDA was $(6,066,798), compared to $(5,625,233) in the six months ended June 30, 2025, a decrease of approximately 8%. This decrease reflects a change in the mix of adjustments. The prior-year period benefited from larger non-cash and financing-related add-backs for non-recurring items, including a $250,000 GEM commitment fee, $230,774 of equity offering costs, $242,502 of loan discount amortization, and higher interest expense of $253,950, that did not recur, or were significantly lower, in 2026. This decline in add-backs more than offset an increase in non-cash share-based compensation adjustments, which rose to $712,342 from $271,644, as well as $68,244 of expense related to restructuring incurred in the current period.

Critical Accounting Policies

The unaudited condensed consolidated financial statements included in this report have been prepared in accordance with U.S. GAAP and reflect the application of estimates and assumptions that require significant judgment by management. These estimates affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosures and are based on a combination of historical experience, current business conditions, and other factors available to management. Actual results could differ materially from those estimates due to the inherent uncertainty in assumptions and external conditions.

There have been no material changes to the Company's critical accounting policies or the methods used in applying those policies during the three months ended June 30, 2026. For a full description of our critical accounting policies and significant estimates, refer to the audited consolidated financial statements and accompanying notes included in our Form 10-K, and "Note 2 - Summary of Significant Accounting Policies" to the unaudited condensed consolidated financial statements included in this report.

Results of Operations

Three Months Ended June 30, 2026, Compared with Three Months Ended June 30, 2025

		Three months ended
		June 30,				June 30,
		2026				2025
Revenue		$	1,110,343			$	1,252,381
Cost of revenue			(377,396	)			(630,916	)
Gross profit		$	732,947			$	621,465
Operating expense			(3,628,021	)			(4,710,595	)
Operating loss			(2,895,074	)			(4,089,130	)
Other expense			(154,191	)			(728,604	)
Loss from continuing operations before tax			(3,049,265	)			(4,817,734	)

Revenue. Revenue was $1,110,343 for the three months ended June 30, 2026, compared to $1,252,381 for the three months ended June 30, 2025, representing a decrease of approximately 11%. Revenue for the three months ended June 30, 2026, consisted of $821,169 from our homebuying services segment, and $289,174 from our technology services segment, compared to $1,030,472 and $221,909, respectively, for the three months ended June 30, 2025.

The decrease in revenue from our homebuying services segment was primarily attributable to the absence of revenue from GTG Financial in the current period following the rescission of the GTG Financial acquisition in August 2025. GTG Financial contributed $568,206 of revenue during the three months ended June 30, 2025. This decrease was partially offset by an increase in revenue generated from real estate brokerage transactions through Prevu's operations, which contributed $369,572 during the three months ended June 30, 2026, compared to no such revenue during the three months ended June 30, 2025. Although we recently modified our commission rebate structure, we have not experienced a material change in revenue generated by our homebuying services segment under the new structure. We continue to evaluate the impact of this change on revenue, total transaction volume, and customer adoption.

Revenue from our technology services segment increased primarily due to higher subscription revenue from AiChat's platform, which generated $244,175 during the three months ended June 30, 2026, compared to $158,660 during the three months ended June 30, 2025.

Cost of revenue. Cost of revenue was $377,396 for the three months ended June 30, 2026, compared to $630,916 for the three months ended June 30, 2025, a decrease of approximately 40%. The decrease was primarily attributable to the absence of direct costs associated with the operations of GTG Financial, which had historically incurred higher cost of revenue than our other homebuying services operating subsidiaries. Cost of revenue for the current period reflects direct expenses associated with delivering our mortgage brokerage, real estate brokerage, and technology services, including compensation-related costs for personnel supporting loan origination and customer interactions.

Operating expenses. Operating expenses were $3,628,021 for the three months ended June 30, 2026, compared to $4,710,595 for the three months ended June 30, 2025, a decrease of approximately 23%. The decrease in operating expenses was primarily driven by a decrease in marketing and advertising expenses, as well as a reduction in professional and legal fees. The decrease in marketing and advertising expenses was primarily attributable to the absence of non-cash marketing expense recognized under the MMC media-for-equity transaction (see "Note 10 - Mezzanine Equity and Preferred Stock Embedded Derivative Liability" for more information), with marketing and advertising expenses decreasing to $178,076 for the three months ended June 30, 2026, from $1,483,672 for the three months ended June 30, 2025 . As the Company fully utilized all marketing credits under the MMC program in prior periods, there were no non-cash marketing expenses recognized during the three months ended June 30, 2026. Professional and legal fees decreased primarily due to lower legal, accounting, and other professional service costs incurred during the three months ended June 30, 2026, declining to $650,294 from $1,003,732 for the three months ended June 30, 2025. The prior-year period included higher legal and professional fees associated with financing and capital-raising activities that did not occur during the current period. During the three months ended June 30, 2026, the Company also implemented a restructuring plan, including a reduction in force, to improve operating efficiency and better align its cost structure with its strategic objectives. While the related restructuring costs were not material to the current-period operating expense variance, management expects these initiatives to support a more efficient operating cost structure over time.

Other expenses. Other expense was $154,191 for the three months ended June 30, 2026, compared to $728,604 for the three months ended June 30, 2025. The decrease in other expense was primarily attributable to lower interest expense, which decreased to $16,790 for the three months ended June 30, 2026, from $242,639 for the three months ended June 30, 2025, following the repayment of debt outstanding during the prior comparable period, as well as lower financing-related costs, including the absence of amortization of commitment fees incurred in the prior-year period. These decreases were partially offset by a smaller gain recognized from the change in fair value of contingent consideration (see "Note 12 - Commitments and Contingencies-Contingent Consideration" for more information), which was $21,677 for the three months ended June 30, 2026, compared to $174,000 for the three months ended June 30, 2025.

Six Months Ended June 30, 2026, Compared with Six Months Ended June 30, 2025

		Six months ended
		June 30,				June 30,
		2026				2025
Revenue		$	1,951,406			$	2,178,016
Cost of revenue			(666,193	)			(1,037,884	)
Gross profit		$	1,285,213			$	1,140,132
Operating expense			(8,461,389	)			(7,651,521	)
Operating loss			(7,176,176	)			(6,511,389	)
Other (expense) income			(211,636	)			(1,156,513	)
Loss from continuing operations before tax			(7,387,812	)			(7,667,902	)

Revenue. Revenue was $1,951,406 for the six months ended June 30, 2026, compared to $2,178,016 for the six months ended June 30, 2025, representing a decrease of approximately 10%. Revenue for the six months ended June 30, 2026, consisted of $1,398,643 from our homebuying services segment and $552,763 from our technology services segment, compared to $1,782,542 and $395,474, respectively, for the six months ended June 30, 2025.

The decrease in revenue from our homebuying services segment was primarily attributable to the absence of the $954,800 of revenue generated by GTG Financial during the six months ended June 30, 2025, following the rescission of the GTG Financial acquisition in August 2025. This decrease was partially offset by an increase in revenue generated from real estate brokerage transactions through Prevu's operations, which contributed $543,264 during the six months ended June 30, 2026, compared to no such revenue during the six months ended June 30, 2025. Although we recently modified our commission rebate structure, we have not experienced a material change in revenue generated by our homebuying services segment under the new structure. We continue to evaluate the impact of this change on revenue, total transaction volume, and customer adoption.

Although total transaction volume increased, revenue decreased during the six months ended June 30, 2026, primarily due to the absence of revenue from GTG Financial, partially offset by revenue generated through Prevu's operations. In addition, total transaction volume is measured on a trailing twelve-month basis and reflects the full value of the underlying transactions, whereas revenue reflects the commissions, fees and other amounts recognized during the applicable six-month period. Accordingly, changes in total transaction volume may not correspond directly or proportionately with changes in revenue.

Revenue from our technology services segment increased primarily due to higher subscription revenue from AiChat's platform, which generated $462,763 during the six months ended June 30, 2026, compared to $268,212 during the six months ended June 30, 2025.

Cost of revenue. Cost of revenue was $666,193 for the six months ended June 30, 2026, compared to $1,037,884 for the six months ended June 30, 2025, a decrease of approximately 36%. The decrease was primarily attributable to the absence of direct costs associated with the operations of GTG Financial, which had historically incurred higher cost of revenue than our other homebuying services operating subsidiaries. Cost of revenue for the current period reflects direct expenses associated with delivering our mortgage brokerage, real estate brokerage, and technology services, including compensation-related costs for personnel supporting loan origination and customer interactions.

Operating expenses. Operating expenses were $8,461,389 for the six months ended June 30, 2026, compared to $7,651,521 for the six months ended June 30, 2025, an increase of approximately 11%. The increase in operating expenses was primarily driven by higher wages due to our increased headcount following our recent acquisition, which was partially offset by a decrease in marketing and advertising expenses and a reduction in professional and legal fees. Wages, benefits and payroll taxes increased to $4,157,988 for the six months ended June 30, 2026, from $2,636,525 for the six months ended June 30, 2025. Marketing and advertising expenses decreased to $1,440,059 for the six months ended June 30, 2026, from $2,002,611 for the six months ended June 30, 2025. The decrease in marketing and advertising expenses was primarily attributable to lower non-cash marketing expense recognized under the MMC media-for-equity transaction (see "Note 10 - Mezzanine Equity and Preferred Stock Embedded Derivative Liability" for more information), as the Company fully utilized a significant portion of its marketing credits in prior periods. Of the current period amount, approximately $593,429 was non-cash expense recognized in connection with the utilization of pre-paid marketing credits, while our cash marketing and advertising expenses were approximately $846,630 for the six months ended June 30, 2026. Professional and legal fees decreased to $1,380,923 for the six months ended June 30, 2026, from $1,745,891 for the six months ended June 30, 2025. The prior-year period included higher legal and professional fees associated with financing and capital-raising activities that did not occur during the current period. During the six months ended June 30, 2026, the Company also implemented a restructuring plan, including a reduction in force, to improve operating efficiency and better align its cost structure with its strategic objectives. While the related restructuring costs were not material to the current-period operating expense variance, management expects these initiatives to support a more efficient operating cost structure over time.

Other expenses. Other expense was $211,636 for the six months ended June 30, 2026, compared to $1,156,513 for the six months ended June 30, 2025. The decrease in other expense was primarily attributable to lower interest expense, which decreased to $41,465 for the six months ended June 30, 2026, from $447,702 for the six months ended June 30, 2025, following the repayment of debt outstanding during the prior-year period, as well as lower other financing-related costs, including the absence of amortization of commitment fees incurred in the prior-year period. These decreases were partially offset by a smaller gain recognized from the change in the fair value of contingent consideration, which was $40,027 for the six months ended June 30, 2026, compared to $81,000 for the six months ended June 30, 2025 (see "Note 12 - Commitments and Contingencies - Contingent Consideration" for more information).

Non-GAAP Financial Measures

To supplement our financial information presented in accordance with U.S. GAAP, we believe "Adjusted EBITDA," a "non-U.S. GAAP financial measure," as such term is defined under the rules of the SEC, is useful in evaluating our operating performance. We use Adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that this non-U.S. GAAP financial measure may be helpful to investors because it provides consistency and comparability with past financial performance. However, this non-U.S. GAAP financial measure is presented for supplemental informational purposes only, has limitations as an analytical tool, and should not be considered in isolation or as a substitute for financial information presented in accordance with U.S. GAAP. In addition, other companies, including companies in our industry, may calculate a similarly titled non-U.S. GAAP measure differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of this non-U.S. GAAP financial measure as a tool for comparison. A reconciliation is provided below for our non-U.S. GAAP financial measure to the most directly comparable financial measure stated in accordance with U.S. GAAP. Investors are encouraged to review the related U.S. GAAP financial measure and the reconciliation of this non-U.S. GAAP financial measure to its most directly comparable U.S. GAAP financial measure, and not to rely on any single financial measure to evaluate our business.

We use Adjusted EBITDA, a non-U.S. GAAP financial measure, to evaluate our operating performance and facilitate comparisons across periods and with peer companies. We reconcile our Adjusted EBITDA to our net income (loss) adjusted to exclude interest expense, depreciation and amortization, share-based compensation, and other non-cash, non-operating, or non-recurring items that we believe are not indicative of our core business operations. We believe this measure provides useful insight into our ongoing performance; however, it should not be considered a substitute for, or superior to, net income or other financial information prepared in accordance with U.S. GAAP.

The following table provides a reconciliation of net income to Adjusted EBITDA for the periods presented below:

		For the Three Months Ended								For the Six Months Ended
		June 30,								June 30,
		2026				2025				2026				2025
Net loss		$	(3,049,265	)			(4,817,734	)		$	(7,387,812	)			(7,667,902	)
Adjusted to exclude the following
Depreciation and amortization			170,680				131,045				332,739				261,444
Amortization of loan discounts and origination fee			-				121,251				-				242,502
Impairment of capitalized software development- work in progress			-				105,900				-				105,900
Changes in fair value of contingent consideration(1)			(21,677	)			(174,000	)			(40,027	)			(81,000	)
Change in fair value of derivative liability(2)			157,532				417,705				185,032				417,705
Loss on equity method investments			2,951				1,526				5,180				2,398
Interest expense			16,790				191,454				41,465				253,950
GEM commitment fee			-				125,000				-				250,000
Share-based compensation (3)			368,377				192,988				712,342				271,644
Equity offering costs			-				230,774				-				230,774
Impairment of intangible assets(4)			16,039				-				16,039				-
Acquisition-related expenses			-				-				-				87,352
Expense related to restructuring			68,244				-				68,244				-
Adjusted EBITDA		$	(2,270,329	)			(3,474,091	)		$	(6,066,798	)			(5,625,233	)

(1)

Represents non-cash changes in the fair value of contingent consideration payable to reAlpha Mortgage which is calculated based on revenue and EBITDA targets (see "Note 12 - Commitments and Contingencies" for more information).

(2)

Represents non-cash changes in the fair value of derivative liability recorded in connection with our media-for-equity transaction with MMC (see "Note 10 - Mezzanine Equity and Preferred Stock Embedded Derivative Liability" for more information).

(3)

Represents non-cash stock-based compensation expenses recognized during the period (see "Note 11 - Stockholders' Equity" for more information).

(4)

Represents impairment of intangible assets during the period (see "Note 6 - Goodwill and Intangible Assets" for more information).

(5)

Represents restructuring costs incurred in connection with the Plans (see "Note 1 - Organization and Description of Business" for more information).

Liquidity and Capital Resources

Liquidity describes the ability of a company to generate sufficient cash flows to meet the cash requirements of its business operations, including working capital needs, debt service, acquisitions, contractual obligations and other commitments. Our liquidity and capital resources are critical to our ability to execute our business plan and achieve our strategic objectives. Accordingly, to the extent that collections from our operations cannot fund our operations, we intend to utilize equity or debt offerings to raise these funds, although volatility in the capital markets may negatively affect our ability to do so.

We had cash and cash equivalents of $2.2 million as of June 30, 2026, and $7.8 million as of December 31, 2025. Based on our estimates, we believe we do not have sufficient working capital to meet our financial needs for the 12-month period following the date that the unaudited condensed consolidated financial statements included in this report are issued. Further, based on our current operating plans, we estimate that our cash and cash equivalents as of June 30, 2026, will be sufficient to fund our operating expenses and capital expenditure requirements for a period of three months as of the filing date of this report. These conditions, including recurring operating losses, negative operating cash flows, limited cash resources relative to projected cash requirements, and dependence on external financing, raise substantial doubt about our ability to continue as a going concern within one year after the date that the unaudited condensed consolidated financial statements included in this report are issued (see "Note 3 - Going Concern" for more information).

Accordingly, to the extent that collections from our operations cannot fund our operations beyond such period, we intend to utilize equity or debt offerings to raise additional funds, although volatility in the capital markets may negatively affect our ability to do so on terms acceptable to us, or at all. As part of these efforts, we previously raised capital through equity offerings and utilized our At the Market ("ATM") program with H.C. Wainwright & Co., LLC ("Wainwright") to raise working capital, and during the three months ended March 31, 2026, we raised approximately $126,150 in net proceeds through such ATM program (see "Note 11 - Stockholders' Equity" for more information). However, the amount and timing of future proceeds we may receive from the sale of shares of common stock pursuant to the ATM program with Wainwright, if any, will depend on a number of factors, including that we are eligible to use a Registration Statement on Form S-3 to sell shares thereunder, the number of shares we may elect to sell, the timing of such sales and the future market price of our shares of common stock. As of the date of this report, we are unable to sell shares pursuant to the ATM program with Wainwright due to restrictions on the use of our Form S-3, which may have a material adverse impact on our liquidity and ability to raise capital efficiently when needed.

We may also receive proceeds from the cash exercises of warrants outstanding as of June 30, 2026. As of such date, our outstanding warrants are exercisable into an aggregate of 436,022 shares of common stock. If all such warrants other than the GEM Warrants were exercised for cash, we can potentially receive aggregate gross proceeds of $4.7 million. The amount of cash proceeds that we may ultimately receive is dependent upon the trading price of our common stock and other market conditions, and there can be no assurance that such warrants will be exercised.

Further, due to the ongoing disputes with GEM regarding the warrants issued under the GEM Agreement, there is uncertainty regarding the enforceability of such warrants and the potential proceeds therefrom. As a result, we do not expect that such warrants will be exercised while these disputes are pending.

Our business model requires significant capital expenditures to build and maintain the infrastructure and technology required to support our growing operations. In addition, we may incur additional costs associated with compliance, research and development of new products and services, expansion into new markets or geographies, including through strategic acquisitions, and general corporate overhead. As a result, we may require additional financing in the future to fund our operations, which may include additional equity or debt financings or strategic partnerships or investments. If we are unable to obtain additional financing when required, we may be forced to reduce the scope of our operations, delay the launch of new products or services, or take other actions that could adversely affect our business, financial condition, and results of operations. We may also be required to seek additional financing on terms that are unfavorable to us, which could result in the dilution of our stockholders' ownership interests or the imposition of burdensome terms and restrictions.

While we anticipate continued operating losses for the foreseeable future, we expect to generate more significant revenues as we continue investing in the commercialization of our products and technologies and pursuing strategic growth opportunities. However, our ability to raise additional capital will depend on various factors, including market conditions, investor demand, and our financial performance, and there can be no assurance that we will be able to raise additional funds on acceptable terms, if at all.

Contractual Commitments and Obligations

Acquisition of Prevu

In connection with the acquisition of Prevu, we are obligated to pay deferred consideration totaling $2.5 million pursuant to the terms of the Prevu Merger Agreement. The deferred consideration is payable in four equal installments of $625,000 over an 18-month period following the closing date, payable in cash or shares of our common stock, at our sole discretion. On March 16, 2026, we satisfied $617,495 of our deferred consideration obligation through the issuance of shares of common stock. As of June 30, 2026, the remaining deferred consideration of approximately $1,831,349 was classified as a current liability, as all remaining installments are due within the next 12 months (see "Note 9 - Deferred Liabilities" for more information). Subsequent to June 30, 2026, we satisfied an additional deferred consideration installment through the issuance of shares of common stock (see "Note 15 - Subsequent Events" for more information). To the extent we elect to satisfy future payments in cash, such payments will reduce our available liquidity. To the extent we elect to satisfy future payments through the issuance of shares of common stock, existing stockholders will experience dilution.

Proposed Merger with InstaMortgage

On December 19, 2025, we entered into the Merger Agreement to acquire 100% of the outstanding equity of InstaMortgage for total consideration of approximately $8.5 million, payable in a combination of cash and shares of our common stock, including deferred consideration. The transaction is targeted to close by the end of August 2026, subject to regulatory approvals and other customary closing conditions. In connection with this proposed acquisition, we will be required to pay cash consideration of approximately $0.5 million and issue approximately $1.5 million in shares of our common stock if and when the acquisition is consummated. As of June 30, 2026, the $0.5 million cash consideration is being held in escrow. (see "Recent Developments - Proposed Merger with InstaMortgage Inc." for more information).

Cash Flows

The following table summarizes our cash flows from operating, investing, and financing activities for the periods presented.

		Six Months Ended
		June 30,				June 30,
Particulars		2026				2025
Net cash used in operating activities		$	(5,478,111	)		$	(4,602,029	)
Net cash (used in) provided by investing activities		$	(116,862	)		$	191,132
Net cash provided by financing activities		$	42,312			$	1,874,264

Cash Flows from Operating Activities

For the six months ended June 30, 2026, net cash used in operating activities was $5,478,111, compared to $4,602,029 for the six months ended June 30, 2025, an increase of $876,082. The increase in net cash used in operating activities was primarily attributable to higher personnel-related costs, including increased wages and benefits and stock-based compensation associated with additional RSU and common stock grants to employees and directors, as well as changes in working capital during the current period. These increases were partially offset by lower non-cash marketing expense following the utilization of the remaining MMC marketing credits in prior periods.

Cash Flows from Investing Activities

For the six months ended June 30, 2026, net cash used in investing activities was $116,862, compared to net cash provided by investing activities of $191,132 for the six months ended June 30, 2025, a change of $307,994. The change was primarily attributable to the absence of cash acquired as part of business combinations during the six months ended June 30, 2026. During the prior-year period, the Company acquired cash and cash equivalents through business acquisitions, which increased net cash provided by investing activities for such period.

Cash Flows from Financing Activities

For the six months ended June 30, 2026, net cash provided by financing activities was $42,312, compared to $1,874,264 for the six months ended June 30, 2025, a decrease of $1,831,952. Net cash provided by financing activities during the six months ended June 30, 2026, was lower than in the prior-year period primarily because we raised significantly less capital through equity issuances, including through our ATM program, during the current period. In addition, $617,495 of the first deferred consideration payment related to the Prevu acquisition was satisfied through the issuance of common stock during the period. The remaining portion of the installment was not issued as of June 30, 2026 due to pending documentation required to complete the issuance. The $617,495 settlement was a non-cash financing activity and, accordingly, did not affect cash flows from financing activities.

Off-Balance Sheet Transactions

We do not have any off-balance sheet transactions.