Compass Posts $51M Loss in Banner Quarter

Compass was bigger and better in the first quarter.

The residential giant reported a net loss of $51 million in the first quarter, up from a $133 million loss in the same period in 2024, according to its earnings report.

The firm’s revenue increased 29 percent to $1.4 billion, with just over 9 percent of the growth attributed to its acquisition of @properties and Christie’s International Real Estate — a deal the company closed in January. The company reported that its organic revenue growth accounted for 15 percent.

Compass nabbed record free cash flow in the first quarter with $19.5 million. After going public in 2021, Compass set its sights on becoming cash flow positive, a goal it achieved in the second quarter of 2023.

Following the milestone, the firm logged its first cash flow positive year in 2024 and has reported cash flow positivity in seven of the last eight quarters.

“Our strategy remains unchanged,” CEO Robert Reffkin said on the Thursday earnings call. “Compass will continue to outgrow the market.”

Headcount, dealcount on the rise

Compass’ revenue expansion was powered by a 28 percent rise in transactions, despite a disruption in deals in March following concerns over President Donald Trump’s talk, and later, implementation of wide-ranging tariffs. Reffkin said that in March, deals fell to their lowest levels since 2009.

“It’s not a surprise that there’s volatility,” Reffkin said, adding that the implementation of the policies drove deals down in April as well. The executive said he expects prices to remain stable for the remainder of the year as more inventory hits the market.

Transactions, minus mergers and acquisitions, rose 7 percent compared to the previous year, which beat a transaction decline of 2 percent across the overall market.

The brokerage grew its market share to 6 percent from just over 5 percent in the previous quarter and under 5 percent in the same period last year.

The company posted an adjusted EBITDA — earnings before interest, taxes, depreciation and amortization — of $16 million, up from negative $20 million in the first quarter last year.

Compass ended the quarter with $127 million in cash. The firm paid $105 million in cash during the period as part of the Christie’s acquisition.

Earlier this quarter, Compass finalized its $444 million deal to buy @properties and Christie’s, which the firm estimated will boost its revenue by $500 million this year. During the period, Compass also acquired the D.C.-based luxury brokerage, Washington Fine Properties, and its 150 agents.

With the acquisitions under its belt, Compass increased its principal agent count by 42 percent, most of them as a result of bringing new firms into the fold.

“There is a significant amount of brokerage fragmentation that exists in the market today,” Reffkin said. “Our M&A pipeline remains healthy.”

Platforms, policies and private exclusives

Reffkin has been at the forefront of the industry’s battle over private exclusive listings, which heated up at the start of the year when the company began implementing its three-phased marketing strategy. The company reported that 48 percent of homeowners who listed with Compass in the first quarter first listed their home as a private exclusive.

Reffkin’s war path has included campaigning for the end of the National Association of Realtors’ Clear Cooperation Policy. The chief executive on Thursday’s earnings call addressed the trade group’s decision in March to keep the policy and emphasized that office exclusives, or Compass private exclusives, are allowed to continue.

“Over the next year, I expect to see more private listings than ever before, which will add to Compass’ inventory advantage,” Reffkin said.