C
ompass' strategy is to attract more buyers with exclusive listings, said CEO Robert Reffkin. The brokerage aims to accelerate its gap from the industry. In Q4 2023, Compass posted a 21% year-over-year increase in principal agents and significant revenue gains that exceeded guidance.

    Revenue reached $1.4 billion for Q4, up nearly 26% from the same period a year ago, while transactions increased by more than 24%. The company ended the quarter with more cash on hand compared to the prior quarter but remains in the red following its acquisition of @properties Christie's International Real Estate.

    During an earnings call, Reffkin discussed Compass' competitive advantages and aggressive push for private listings. He highlighted the brokerage's ongoing 3-phase marketing strategy and the launch of its Compass One client dashboard. Reffkin emphasized that "depth of inventory, not breadth" will set Compass apart from competitors.

    As of February 16, roughly 35% of Compass' over 22,000 total listings were in its Private Exclusives or Coming Soon channels, with about half listed for over $1 million. Reffkin expressed concerns about NAR's model and Clear Cooperation Policy, stating that it may limit market share gains for top agents and brokerages.

    Following the August practice changes, MLSs are not enforcing the CCP in nearly half of Compass' markets. Reffkin believes this structural change will favor Compass, leading to a widening gap between the brokerage and the industry. He predicts that the free market will reward the best agents and brokerages with higher pay.

    Key numbers include:

    * Revenue: $1.4 billion in Q4, up 25.9% year-over-year

    * Cash and cash equivalents: $223.8 million at the end of Q4

    * Net income/loss: A net loss of $40.5 million in Q4

    * Adjusted EBITDA: $16.7 million in Q4 2024

    * Transactions: Compass agents closed 50,411 total transactions in Q4 2024

    * Agent count: The brokerage ended the year with 17,752 principal agents