What does Compass do and what are its main business segments?

What is the market's earnings forecast for Compass next quarter?

What guidance did Compass's management provide for the next earnings period?

What were the key takeaways from Compass's earnings call?

What were the key takeaways from Compass’s earnings call?

What factors drove the changes in Compass's revenue and profit?

What is Compass's gross profit margin?

Did Compass beat or miss consensus estimates last quarter?

- **Revenue Growth**: $1.85 billion (+23.6% YoY), outpacing market by 20+ percentage points in total transactions.
- **EBITDA Expansion**: $93.6 million adjusted EBITDA (+80% YoY), driven by OpEx control and margin improvements.
- **AI Adoption**: Compass AI 2.0 to automate 70% of agent tasks, with ChatGPT generating organic leads for top agents.
- **Merger Synergies**: >$300 million net cost savings target, including $150 million first-year benefits from Anywhere deal.
- **Agent Expansion**: 851 new agents in Q3, guiding to 700-800 annually, supported by platform investments and market share gains.

**【CEO Summary Section】**
- **Record Q3 Performance**: Revenue of $1.85 billion (+23.6% YoY), adjusted EBITDA of $93.6 million (+80% YoY), and free cash flow of $73.6 million, all records for a third quarter.
- **Market Outperformance**: Organic transactions grew 7% YoY vs. 2% market growth, with 20+ percentage points of outperformance in total transactions.
- **AI and Agent Growth**: Launched Compass AI 2.0 to 851 new agents, aiming to automate 70% of agent tasks. Generative AI like ChatGPT is driving organic leads for top agents.
- **Anywhere Merger Synergies**: Increased net cost synergy target to >$300 million (11% of combined OpEx), with $150 million realized in first year post-close.
- **Agent Recruitment**: Added 851 principal agents in Q3, guiding to 800 in Q4 and 700-800 annually, driven by platform differentiation and market support.

**【CFO Financial Commentary】**
- **Revenue and Margins**: GAAP revenue $1.85 billion, commissions as % of revenue 81.4%, up 73 bps YoY due to higher-margin Christie's business.
- **OpEx Control**: Full-year 2025 OpEx guidance reduced to $1.00 billion-$1.005 billion, down $34 million from prior midpoint, excluding $7.5 million merger costs.
- **Free Cash Flow**: $73.6 million Q3, highest for any third quarter, with $2.9 million net income excluding merger costs.
- **M&A Impact**: 2025 M&A contributed $50 million to revenue growth, with organic growth 11% YoY.

**【Q&A Highlights】**
- **Synergy Execution**: CEO commits to >$300 million synergies, citing Christie's playbook of agent growth, attach rate improvements, and OpEx savings.
- **AI Lead Generation**: Top agents report free leads from ChatGPT, driven by verified transaction history and performance data.
- **Franchise Strategy**: Scaling Compass platform to franchises, testing enterprise sales processes and transaction management efficiencies.
- **Legal Costs**: Ongoing legal expenses in OpEx, with some expected to continue into 2026, but no material impact on guidance.

Compass, Inc. (COMP) Q3 2025 Earnings Call Transcript

- **Revenue Records**: Q2 revenue ($2.06B) and EBITDA ($126M) set all-time highs, with organic growth outpacing the market by 22%.
- **Agent Dominance**: Recruited 832 agents (53% YoY), highest retention (97.5%) and T&E attach rates (700 bps YoY) reflect agent preference for Compass' platform.
- **Cost Efficiency**: $50-75M EBITDA improvement program for 2026, with OpEx growth (3-4%) lagging revenue (21%).
- **Strategic Momentum**: M&A pipeline at record levels, T&E expansion to 70% of markets, and AI-driven Compass 2.0 beta testing in Q3.
- **Market Resilience**: 6.09% market share (up 96 bps YoY), outperforming market in both transactions and attach rates despite housing challenges.

**【CEO Summary Section】**
- **Record Financial Performance**: Q2 revenue reached $2.06 billion (21.1% YoY growth), with organic revenue up 8.7%. Adjusted EBITDA hit $126 million (63% YoY increase), and GAAP net income rose to $39.4 million (90% YoY growth). Free cash flow was $68 million, a new quarterly record.
- **Market Share Expansion**: Market share increased to 6.09% (up 96 bps YoY), outpacing the market by 22% in transaction growth. Organic transactions grew 6.3% vs. the market's 0.9% decline.
- **Agent Recruitment & Retention**: Recruited 832 gross principal agents organically (53% YoY growth), with retention at 97.5%. The T&E business saw record attach rates (700 bps YoY improvement), and Compass AI platform engagement rose 37% YoY.
- **Strategic Initiatives**: Launched One-Click Title & Escrow in New York, with T&E attach rates nearing 50% in mature markets. AI integration in Compass 2.0 aims to enhance agent productivity and operational efficiency.

**【CFO Financial Commentary】**
- **Financial Highlights**: GAAP net income of $39.4 million, free cash flow of $68 million, and $177 million in cash on hand. Non-GAAP OpEx was $250 million, up 15% YoY due to M&A, but OpEx growth rate (3-4%) lagged revenue growth (21%).
- **Cost Efficiency Program**: Launched a $50-75 million incremental EBITDA improvement program for 2026, driven by AI adoption, process efficiencies, and inflationary cost offsets. 2025 OpEx guidance revised to $1.01-1.02 billion (down $25 million from prior range).
- **Guidance**: Q3 2025 revenue expected $1.725-1.85 billion, with adjusted EBITDA $60-80 million. Full-year OpEx savings of $600 million over three years remain on track.

**【Q&A Key Highlights】**
- **Industry Dynamics**: CEO Robert Reffkin criticized MLS/portals for controlling agent behavior, citing Compass' success in offering choice (e.g., private exclusives). Broker CEOs pursuing M&A with Compass to counter external control, with M&A pipeline at record levels.
- **Agent Recruitment**: 832 gross adds (53% YoY) driven by advocacy for agent autonomy. Retention improved 20 bps YoY, with top agents prioritizing client service over MLS compliance.
- **T&E Growth**: Attach rates near 75% for One-Click users, with T&E revenue at record highs. Expansion to 70% of markets by year-end expected to accelerate contribution.
- **Market Outlook**: July pending sales up 5% YoY, but overall market remains challenging. Compass' tech-enabled platform and cost discipline position it to gain share in downturns.


Compass, Inc. (COMP) Q2 2025 Earnings Call Transcript

- **Revenue Superiority**: Q1 revenue +28.7% YoY ($1.36B), transactions +27.8% vs. market -2.1%. Adjusted EBITDA turned positive at $15.6M.
- **Agent Growth Engine**: 700 new principals (35% YoY), 96.6% retention. Title/Escrow attach rates +695 bps YoY.
- **Strategic Wins**: Christie's adds 4 affiliates in 2.5 months; Title/Escrow unit EBITDA matches brokerage levels when attached.
- **Cost Discipline**: Organic OpEx +3-4% YoY; Q2 free cash flow $19.5M despite $29M legal payment.
- **Market Outlook**: 2025 sees flat prices, modest volume growth; 3-phase marketing gains 49% client adoption with no downside risk.

**【CEO Summary Section】**
- Q1 revenue increased 28.7% YoY to $1.36 billion, driven by organic growth (14.6%) and M&A. Total transactions rose 27.8% YoY, outpacing the market decline of 2.1%. Adjusted EBITDA turned positive at $15.6 million, up from -$20 million YoY.
- Agent recruitment hit 700 gross principals (35% YoY growth), with retention at 96.6%. Title & Escrow attach rates improved 695 bps YoY, and the Christie's acquisition added 4 new affiliates ahead of plan.
- Emphasized long-term strategy: 3-4% organic OpEx growth, expanding Title/Escrow margins (targeting 25-30%), and 5x Christie's affiliate network. Unit economics: attaching Title/Escrow can double brokerage EBITDA contribution.

**【CFO Financial Commentary】**
- Q1 GAAP net loss was $51 million, narrower than $133 million YoY due to a $57.5 million antitrust charge. Free cash flow reached $19.5 million, a Q1 record, though Q2 may see headwinds from $29 million class action payment.
- Q2 guidance: Revenue $2-2.15 billion (17-24% YoY), EBITDA $115-135 million. Organic OpEx growth remains 3-4%, with total OpEx $1.017-1.042 billion. Stock-based comp jumps to $55 million Q2 due to share price timing, but dilution remains ~1% per quarter.

**【Q&A Key Takeaways】**
- **Market Volatility**: March tariff fears slowed transactions, but Q1 was near guidance. Q2 tracking as expected, with April activity stable. CEO sees 2025 as similar to 2024: flat prices, modest volume growth.
- **3-Phase Marketing**: 49% of Q1 clients used private exclusives, with no downside risk. NAR's CCP rule allows private listings, and agents report higher client satisfaction. Competitors are copying the strategy.
- **Agent Recruitment**: 700 organic adds vs. 6-7k annual target. Retention stable at 96.6%. Platform tools (e.g., one-click title) and inventory depth drive demand. Competitors' cost-cutting creates recruiting opportunities.
- **OpEx Seasonality**: Q2 OpEx may rise slightly due to annual comp cycles, but 3-4% organic growth target holds. Christie's integration tracking ahead of synergy goals.


Compass (COMP)-8 May 25-2025 Q1 Earnings call transcript

- **Revenue Surge**: Q4 2024 revenue up 25.9% YoY to $1.38B, outpacing market growth 3.5x. Q1 2025 guide implies >25% YoY growth.
- **Market Share Leap**: Q4 2024 market share +65bps YoY to 5.06%, fastest growth in 12 quarters. Agent count +21% YoY.
- **3-Phase Marketing Success**: Pre-marketed homes sold 2.9% higher, 20% faster on market, 30% fewer price drops. 35% listings now pre-marketed.
- **Christie's Impact**: $500M+ annual revenue, targeting 5x affiliate count. 2025 affiliate EBITDA to more than double.
- **Profitability Boost**: 2024 free cash flow $106M (first full year positive). 2025 OpEx growth capped at 3-4%.

**【CEO Key Highlights】**
- **Revenue Growth**: Q4 2024 revenue of $1.38B (+25.9% YoY), driven by 24.1% transaction growth vs. 6.8% market growth. Q1 2025 guide implies >25% YoY growth at midpoint.
- **Market Share Expansion**: Q4 2024 market share increased 65bps YoY to 5.06%, fastest growth in 12 quarters. Agent count +21% YoY to 30,69 agents.
- **3-Phase Marketing Strategy**: 35% of listings now pre-marketed as Private Exclusives/Coming Soon, reducing days on market by 20% and price drops by 30%. Homes pre-marketed sold for 2.9% higher on average.
- **Christie's Acquisition**: $500M+ annual revenue contribution, targeting 5x current affiliate count. 30-35% EBITDA margin business expected to double 2025 EBITDA.

**【CFO Financial Breakdown】**
- **Profitability**: Q4 2024 adjusted EBITDA $16.7M (excl. $4.2M M&A costs → $20.9M). Full year 2024 free cash flow $106M, first full year of positive FCF.
- **Cost Control**: 2024 OpEx $888M (-$56M YoY), targeting 3-4% organic growth in 2025. Q4 OpEx $224.4M (+$0.8M YoY, -5% ex M&A).
- **Balance Sheet**: $234M cash as of Q4, $50M revolver draw for Christie's acquisition. 2025 FCF guidance: solidly positive, 70-80% EBITDA conversion.

**【Q&A Key Takeaways】**
- **Agent Recruitment**: 669 agents added organically in Q4, 96.9% retention. Private Exclusives/Coming Soon tools top reason agents join Compass.
- **Christie's Growth**: 2 new international markets launched, 1 domestic affiliate signed. Expect 2025 EBITDA from affiliate business to more than double.
- **Free Cash Flow Use**: Prioritize balance sheet strength, tech investment, and long-term shareholder returns. No immediate buyback plans.
- **Commission Trends**: Top agents gaining market share, commission splits reflecting productivity. No material impact on Compass margin from split degradation.


COMP

COMP fundamentals

Earnings Call

You can ask Aime