Segment Information (Tables)

6 Months Ended

Jun. 30, 2020

Segment Information

Schedule of Revenue from External Customers By Segment

The following table presents revenue from external customers by segment (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Continuing franchise fees (a)	$	15,795	$	23,978	$	38,672	$	48,095
Annual dues		8,745		8,819		17,666		17,673
Broker fees (a)		10,426		13,459		19,870		22,047
Franchise sales and other revenue		3,405		4,129		12,068		12,394
Total RE/MAX Franchising		38,371		50,385		88,276		100,209
Continuing franchise fees		943		916		2,209		1,755
Franchise sales and other revenue		127		114		319		234
Total Motto Franchising		1,070		1,030		2,528		1,989
Marketing Funds fees (a)		11,765		18,060		29,287		36,832
Other		1,001		1,906		2,388		3,529
Total revenue	$	52,207	$	71,381	$	122,479	$	142,559

(a) Continuing franchise fees and Marketing Funds fees declined primarily due to the temporary COVID-19 related financial support programs offered to franchisees. Broker fees declined primarily due to reductions in home sale transactions due to the COVID-19 pandemic.

Schedule of Revenue and Adjusted EBITDA of the Company's Reportable Segment

The following table presents a reconciliation of Adjusted EBITDA by segment to income before provision for income taxes (in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Adjusted EBITDA: RE/MAX Franchising	$	19,318	$	30,021	$	40,049	$	54,165
Adjusted EBITDA: Motto Franchising		(741)		(719)		(1,319)		(1,460)
Adjusted EBITDA: Other		332		580		(282)		167
Adjusted EBITDA: Consolidated		18,909		29,882		38,448		52,872
Gain (loss) on sale or disposition of assets		11		16		22		(363)
Equity-based compensation expense		(2,747)		(1,796)		(4,933)		(5,847)
Acquisition-related expense (a)		(328)		(15)		(894)		(87)
Gain on reduction in tax receivable agreement liability		(500)		—		—		—
Fair value adjustments to contingent consideration (b)		(150)		(415)		355		(345)
Interest income		34		342		303		662
Interest expense		(2,187)		(3,154)		(4,869)		(6,309)
Depreciation and amortization		(6,412)		(5,541)		(12,722)		(11,099)
Income before provision for income taxes	$	6,630	$	19,319	$	15,710	$	29,484

(a) Acquisition-related expense includes legal, accounting, advisory and consulting fees incurred in connection with the acquisition and integration of acquired companies.

(b) Fair value adjustments to contingent consideration include amounts recognized for changes in the estimated fair value of the contingent consideration liability. See Note 9, Fair Value Measurements for additional information.