Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2023

Summary of Significant Accounting Policies

Schedule of deferred revenue for franchise sales and annual dues

The activity consists of the following (in thousands):

	Balance at				Revenue		Balance at
	January 1, 2023		New billings		recognized (a)		March 31, 2023
Franchise sales	$	25,281	$	2,252	$	(2,372)	$	25,161
Annual dues		14,164		9,475		(8,618)		15,021
Other		6,626		6,366		(10,043)		2,949
	$	46,071	$	18,093	$	(21,033)	$	43,131

(a) Revenue recognized related to the beginning balance for Franchise sales and Annual dues were $2.3 million and $6.4 million, respectively, for the three months ended March 31, 2023.

Schedule of commissions related to franchise sales

The activity in the Company’s capitalized contract costs for commissions (which are included in “other current assets” and “other assets, net of current portion” on the Condensed Consolidated Balance Sheets) consist of the following (in thousands):

			Additions to
	Balance at		contract cost		Expense		Balance at
	January 1, 2023		for new activity		recognized		March 31, 2023
Capitalized contract costs for commissions	$	3,974	$	678	$	(543)	$	4,109

Schedule of transaction price allocated to the remaining performance obligations

The following table includes estimated revenue by year, excluding certain other immaterial items, expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period (in thousands):

	Remainder of 2023		2024		2025		2026		2027		2028		Thereafter		Total
Annual dues	$	14,294	$	727	$	—	$	—	$	—	$	—	$	—	$	15,021
Franchise sales		5,351		6,163		4,947		3,573		2,125		989		2,013		25,161
Total	$	19,645	$	6,890	$	4,947	$	3,573	$	2,125	$	989	$	2,013	$	40,182

Schedule of disaggregated revenue

In the following table, segment revenue is disaggregated by Company-Owned or Independent Regions, where applicable, by segment and by geographical area (in thousands):

	Three Months Ended
	March 31,
	2023		2022
U.S. Company-Owned Regions	$	33,861	$	39,154
U.S. Independent Regions		1,476		1,701
Canada Company-Owned Regions		9,798		10,475
Canada Independent Regions		724		703
Global		3,198		3,092
Fee revenue (a)		49,057		55,125
Franchise sales and other revenue (b)		11,573		9,612
Total Real Estate		60,630		64,737
U.S.		16,305		17,559
Canada		4,763		5,013
Global		274		279
Total Marketing Funds		21,342		22,851
Mortgage (c)		3,188		3,028
Other (c)		241		388
Total	$	85,401	$	91,004

(a) Fee revenue includes Continuing franchise fees, Annual dues and Broker fees.

(b) Franchise sales and other revenue is derived primarily within the U.S.

(c) Revenue from Mortgage and Other are derived exclusively within the U.S.

Schedule of reconciliation of cash, both unrestricted and restricted

The following table reconciles the amounts presented for cash, both unrestricted and restricted, in the Condensed Consolidated Balance Sheets to the amounts presented in the Condensed Consolidated Statements of Cash Flows (in thousands):

	March 31, 2023		December 31, 2022
Cash and cash equivalents	$	96,754	$	108,663
Restricted cash		27,329		29,465
Total cash, cash equivalents and restricted cash	$	124,083	$	138,128

Schedule of cost charges to intersegment

Costs charged from Real Estate to the Marketing Funds are as follows (in thousands):

	Three Months Ended
	March 31,
	2023		2022
Technology − operating	$	1,169	$	4,224
Technology – capital (a)		(203)		631
Marketing staff and administrative services		1,492		1,541
Total	$	2,458	$	6,396