New York, NY - Tuesday, February 18, 2025 - Compass, Inc. (NYSE: COMP) (“Compass” or “the Company”), a leading tech-enabled real estate services company that includes the largest residential real estate brokerage in the United States by sales volume, announced its financial results for the fourth quarter and full-year ended December 31, 2024. 

“Despite a year in which resale transactions experienced a 29-year low, Compass grew both Revenue and Adjusted EBITDA significantly and delivered $122 million in operating cash flow, or $150 million prior to the NAR-related settlement payment. As the market recovers, we believe the combination of our cost discipline and structural advantages, which include our end-to-end proprietary technology platform, national scale, network of top agents, and depth of inventory, positions Compass to capture significant upside,” said Robert Reffkin, Founder and Chief Executive Officer of Compass. “In the fourth quarter, we grew transactions by 24.1% or 3.5x faster than the market where transactions grew by 6.8% year-over-year. This led to quarterly market share of 5.06%, or an increase of 65 basis points, which is our highest year-over-year increase in market share in twelve quarters. Importantly, organic transactions increased by 15.5% year-over-year and organic quarterly market share grew 48 basis points.” 

Reffkin continued, “I believe 2025 will be the year that the gap between Compass and the industry widens. By leveraging our structural advantages and our affiliation with the Christie’s International Real Estate brand, we are positioning ourselves to accelerate our market share gains.” 

Kalani Reelitz, Chief Financial Officer of Compass said, “We continue to strengthen our balance sheet and ended the quarter with a cash balance of $223.8 million. In Q4 2024, we generated positive operating cash flow of $30.5 million and free cash flow of $26.7 million, which made us free cash flow positive in every single quarter in 2024, and for the full-year operating cash flow was $121.5 million and free cash flow was $105.8 million. For the full-year, OPEX came in $8 million below the low-end of our full-year OPEX guide, and we achieved this while still maintaining high-levels of agent retention and growing full-year market share by 49 basis points. These results exhibit our commitment to control costs as we continue to outpace market growth.”

Q4 2024 Highlights:

• Revenue in Q4 2024 increased by 25.9% year-over-year to $1.4 billion as transactions increased 24.1%. Year-over-year organic revenue growth (a non-GAAP measure) was up 20.9%, while revenue growth attributable to the acquisitions completed within the prior 12-months was 5%.  

• GAAP Net loss in Q4 2024 was $40.5 million, an improvement of $43.2 million from a net loss of $83.7 million in Q4 2023. The net loss for Q4 2024 includes non-cash stock-based compensation expense of $31.2 million and depreciation and amortization of $19.7 million. 

• Adjusted EBITDA (a non-GAAP measure) was $16.7 million in Q4 2024 compared to ($23.7) million in Q4 2023, an improvement of $40.4 million. Excluding M&A related transaction costs of $4.2 million, Adjusted EBITDA in Q4 2024 would have been $20.9 million. 

• Operating Cash Flow / Free Cash Flow (a non-GAAP measure): During Q4 2024, operating cash flow was $30.5 million and free cash flow was $26.7 million. 

• Cash and cash equivalents at the end of Q4 2024 was $223.8 million, and there were no outstanding draws on our revolving credit facility at that time.  

Q4 2024 Operational Highlights:

• National market share: In Q4 2024, quarterly market share was 5.06%, an increase of 65 basis points compared to Q4 2023 and an increase of 26 basis points sequentially from Q3 2024. This compares favorably to the 9 basis points increase year-over-year in Q4 2023 compared to Q4 2022 and a 10 basis point increase sequentially from Q3 2023 to Q4 2023. Quarterly organic market share growth year-over-year was 48 basis points in Q4 compared to 24 basis points year-over-year in Q3 2024 compared to Q3 2023.  

• Principal Agents : At the end of Q4 2024, the number of principal agents was 17,752 compared to 14,683 at the end of Q4 2023, an increase of 3,069 or 20.9% year-over-year. Sequentially, from Q3 2024 to Q4 2024, Compass hired 669 principal agents on a gross basis, resulting in a net increase of 210 principal agents as Compass managed out non-producers at the end of the year. We continued the trend of strong agent retention with 96.9% quarterly principal agent retention in Q4 2024, flat versus the prior year quarter.  

• Transactions: Compass agents closed 50,411 total transactions in Q4 2024, an increase of 24.1% compared to Q4 2023 (40,621). Organic transactions in Q4 2024 increased by 15.5% compared to Q4 2023. Transactions for the entire U.S. residential real estate market increased 6.8% for the same period, according to NAR. 

• Gross Transaction Value (“GTV”): GTV was $54.0 billion in Q4 2024, an increase of 29.2% compared to Q4 2023 GTV of $41.8 billion. Organic GTV was $52.1 billion in Q4 2024. The entire U.S. residential real estate market GTV increased 12.6% for the same period, according to NAR.

• Inventory: The Compass 3-Phased Marketing Strategy helps homeowners benefit from the same strategies used by the most sophisticated and profit-driven sellers of homes in the industry - real estate developers and homebuilders - by listing first as a Compass Private Exclusive and then as a Compass Coming Soon, before going active on the MLS or public real estate websites. Early results of implementing the Compass 3-Phased Marketing Strategy have been promising, with a growing number of sellers opting into the program and seeing positive outcomes by avoiding unnecessary days on market, price drop history, and negative insights displayed on their listing prior to it being made active on the MLS and public real estate websites. Below are a few data points on our progress so far and results from an internal analysis of listings that went through the Compass 3-Phased Marketing Strategy:  

• As February 16, 2025, homeowners are marketing more than 7,500 listings as a Compass Private Exclusive or a Compass Coming Soon, which are only available by working with a Compass agent or by searching Compass.com:

• Roughly half the Compass Private Exclusive and Compass Coming Soon listings were above a $1 million list price, with the other half being below a $1 million list price, which suggests that this listing strategy is resonating with homeowners across all price points. 

• Of Compass’ 22,138 listings, approximately 35% currently are either a Compass Private Exclusive or Compass Coming Soon.

• So far in February, 55% of all new Compass listings started as a Compass Private Exclusive or Compass Compass Coming Soon.   

• For Compass sell-side transactions from January 1, 2024 through December 31, 2024, properties where the homeowner chose to pre-market as a Compass Private Exclusive and/or a Compass Coming Soon before going active on the MLS:

  • Received an accepted offer 20% faster on average or 8 days faster on average once active on the MLS, than Compass listings without pre-marketing; and

  • Created value for homeowners as only 13% of Compass listings on average that were pre-marketed had a price drop, compared to 19% for Compass listings without pre-marketing. This means approximately 30% fewer listings, on average, took a price drop once active on the MLS vs. Compass listings that were not pre-marketed15.

• Compass also completed an internal analysis to better understand the relationship between close price and pre-marketing as a Compass Private Exclusive and/or a Compass Coming Soon, before going active on the MLS. This analysis examined Compass sell-side transactions of all residential property types in 2024 and found that homes pre-marketed as a Compass Private Exclusive and/or a Compass Coming Soon before going active on the MLS were associated with a 2.9% higher average close price compared to Compass-sold properties that were not pre-marketed in 2024. 

  • At Compass’ average price point of roughly $1 million, homeowners who chose to pre-market their home with a Compass agent were, therefore, likely to have realized a $29,000 premium on what is often the most valuable asset most people own, compared to those who listed directly on the MLS.

• Platform: The Compass end-to-end proprietary technology platform allows real estate agents to perform their primary workflows, from first contact to close, with a single log-in and without leaving the Compass platform. Highlights from Q4 2024 include: 

  • Compass One-click Title Integration: Title & Escrow attach rates improved by more than 800 basis points over the past four quarters as the contribution from our One-click Title integration continues to drive our attach rates higher for agents who utilize the integration than agents who do not.

  • Compass One: The industry’s premier all-in-one client dashboard that is designed to connect buyers and sellers with their agent to provide 24/7 transparency before, during, and after the transaction launched in beta in October 2024 and nationally on February 3, 2025. In the first week after the launch, agents sent 14,950 invitations to clients and we have seen a 43% increase in client engagement as measured by the change in weekly active users.

  • Compass Reverse Prospecting: Launched in late October, Reverse Prospecting provides home sellers with exclusive insights such as real-time updates on how often agents and their clients are looking at, commenting on, favoriting, or sharing listings across the Compass platform, and approximately 8,350 agents have used the feature. In less than three months since its launch, dozens of transactions have been created by matching buyers and sellers through the Compass Reverse Prospecting tool. 

  • Compass Make-Me-Sell: A feature in our platform that allows homeowners to share an aspirational price with their agent that would compel them to move continues to gain traction with approximately 9,500 entries in the platform. With a full launch expected in Q1 2025, we believe this tool will help convert a portion of our 100+ million CRM contacts into passive ‘willing-to-sell’ inventory that will only be available to Compass agents. 

Additional information can be found in the Company’s Q4 2024 Earnings Presentation, which can be found in the Investor Relations section of the Compass website at https://investors.compass.com. 

Q1 2025 Outlook: 

• Revenue of $1.350 billion to $1.475 billion for Q1.

• Adjusted EBITDA of $11 million to $25 million for Q1.

Full Year 2025 Outlook:

• Non-GAAP OPEX of $1.005 billion to $1.030 billion. Included in the range is an increase of 2024 OPEX of 3-4%, $10 million of wrap around OPEX from 2024 M&A and $105 million of OPEX from the Christie’s International Real Estate acquisition that closed on January 13, 2025. 

• Free cash flow positive for the full year 2025.

Original Article: Compass, Inc. Reports Fourth Quarter and Full-Year 2024 Results