Compass, the largest real estate brokerage in the US, has posted a profit for the first time since going public and has increased its market share.
Despite challenging market conditions and slowing transaction volumes in the US, the company achieved an operating cash flow of US$53 million and free cash flow of US$51 million in the second quarter of 2023.
Founder and Chief Executive Officer of Compass, Robert Reffkin, said he was really pleased to post a profit after the company went public on April 1, 2021.
“I am pleased to say we are free cash flow positive in the second quarter of 2023,” Mr Reffkin said.
“Additionally, national market share in Q2 2023 was 4.6 per cent, which marks the third consecutive quarter of market share gains, increasing 45 basis points over the period.”
Mr Reffkin said he was also happy the company continues to retain more than 90 per cent of its principal agents.
While commission expenses as a percentage of revenue also improved by 0.38 per cent.
Mr Reffkin said Compass continued to enhance its proprietary end-to-end platform, with the launch of new features like Performance Tracker, Compass GPT integration as well as 1-click Title & Escrow.
At the end of the second quarter, Compass had 13,633 principal agents, an increase of 429 compared to the same time last year.
Compass agents closed 54,207 transactions in the second quarter down 19 per cent compared to last year..
Similarly, transactions for the entire US residential real estate market declined 21 per cent over the same period.
Slowing transactions saw overall revenue decrease by 26 per cent year-over-year to $1.5 billion driven by macroeconomic factors, combined with a decrease in the price of the average transaction led by fewer sales in high-end markets like California.
Founded in 2012 and based in New York City, the company aims to incorporate a host of technology solutions to assist both buying and selling agents.
