0001213900-26-026653
SEC filingreAlpha Tech Corp. reported a net loss of $17.6 million for FY 2025, an improvement from a $26.0 million loss in FY 2024. Revenue grew 376% year-over-year to $4.5 million, driven by a 77% contribution from homebuying services (primarily mortgage brokerage from reAlpha Mortgage and GTG Financial) and a 23% contribution from technology services (primarily AiChat subscriptions). Gross profit was $2.5 million, yielding a gross margin of 54%, down from 68% in the prior year due to increased direct costs. Operating expenses rose 145% to $18.5 million, primarily from increased wages ($6.5M) and marketing ($5.9M). The company ended the year with $7.8 million in cash, bolstered by $17.7 million in net financing cash flows from equity offerings, but used $11.3 million in operating activities. Management notes substantial doubt about the company's ability to continue as a going concern due to recurring losses and negative cash flows.
For the fiscal year ended December 31, 2025, reAlpha Tech Corp. reported revenue of $4.5 million, a significant increase of 376% compared to $0.9 million in FY 2024. The net loss improved to $17.6 million from $26.0 million in the prior year. The improvement in net loss was partly due to the prior year including an $18.3 million loss from discontinued operations related to the short-term rental business, which was fully discontinued in Q1 2025. From continuing operations, the net loss was $17.6 million in FY 2025 compared to $7.7 million in FY 2024. The company ended the period with $7.8 million in cash and cash equivalents, up from $3.1 million at the end of FY 2024, primarily due to $17.7 million in net cash provided by financing activities from equity offerings.
Revenue growth was driven by the company's two reportable segments. Homebuying services contributed $3.5 million (77% of total revenue), fueled by mortgage brokerage transactions from reAlpha Mortgage ($1.97M) and GTG Financial ($1.42M until its rescission in August 2025), as well as realty services from Prevu following its acquisition in November 2025. Technology services contributed $1.0 million (23% of total revenue), primarily from subscription fees for AiChat's AI conversational platform ($0.76M). The document notes that total transaction volume across homebuying services was $116.2 million for FY 2025, compared to $38.4 million for the partial period in FY 2024 following the acquisition of reAlpha Mortgage.
Gross profit was $2.5 million, yielding a gross margin of 54%, a decrease from 68% in FY 2024. The decline in margin is attributed to higher direct costs associated with delivering mortgage brokerage and technology services, including compensation for personnel. Cost of revenue increased 584% to $2.1 million. Operating expenses rose 145% to $18.5 million, primarily due to increased wages, benefits, and payroll taxes ($6.5M, up from $2.8M), marketing and advertising ($5.9M, up from $0.8M), and professional and legal fees ($3.3M, up from $2.1M). This resulted in an operating loss of $16.0 million. The company reports an Adjusted EBITDA of -$13.7 million for FY 2025, compared to -$5.6 million in FY 2024.
Net cash used in operating activities was $11.3 million for FY 2025, compared to $6.0 million used in FY 2024, reflecting higher operating losses and working capital changes. Net cash used in investing activities was $1.7 million, primarily for acquisitions and capitalized software. Net cash provided by financing activities was $17.7 million, driven by $25.6 million in proceeds from issuance of common stock, partially offset by $5.6 million in debt payments. Total assets were $21.7 million, with goodwill of $7.5 million and intangible assets of $4.3 million. Total liabilities were $9.2 million, including a $4.6 million preferred stock embedded derivative liability and a $4.9 million note payable. Total stockholders' equity was $11.5 million, with an accumulated deficit of $56.0 million.
The company's financial condition raises substantial doubt about its ability to continue as a going concern, as noted by its independent auditor, due to recurring losses, negative cash flows, and the need to raise additional capital. Management's plans to address this include pursuing revenue growth through the integration of acquired companies (Prevu, reAlpha Mortgage, AiChat), expanding services into new geographic markets, and the proposed acquisition of InstaMortgage (expected to close in H1 2026, subject to conditions). The company also intends to utilize capital-raising mechanisms, such as its at-the-market offering program. Key risk factors disclosed include dependence on the cyclical U.S. residential real estate market, intense competition, challenges in technology development and AI integration, regulatory compliance burdens, and ongoing litigation.