Executive Summary

Q4 revenue rose 25.9% year over year to $1.38B as Compass grew transactions 3.5x faster than the market; Adjusted EBITDA was $16.7M (or $20.9M excluding $4.2M M&A costs) and free cash flow was $26.7M .
Market share climbed 65 bps YoY to 5.06% and 26 bps sequentially; principal agents grew 21% YoY with 96.9% quarterly retention .
Management guided Q1 2025 revenue to $1.35–$1.475B and Adjusted EBITDA to $11–$25M; FY2025 non‑GAAP OpEx guided to $1.005–$1.030B with full‑year positive free cash flow .
vs. guidance: Q4 revenue exceeded the high end of the original range and landed around the midpoint of the Jan 15 raised update; Q4 Adjusted EBITDA finished at the midpoint of the raised update; FY2024 Adjusted EBITDA reached a company record of $126M .
Stock reaction catalysts: evidence of share gains and transaction outperformance versus the market, continued free cash flow generation, and the higher‑margin Christie's International Real Estate (CIRE) acquisition expected to lift consolidated unit economics in 2025 .

What Went Well and What Went Wrong

What Went Well

Share gains and outperformance: Q4 transactions +24.1% vs. +6.8% market; quarterly market share 5.06% (+65 bps YoY) and organic share +48 bps YoY . CEO: “we grew transactions by 24.1% or 3.5x faster than the market…highest year‑over‑year increase in market share in twelve quarters” .
Cash generation and OpEx discipline: FCF +$26.7M in Q4; FY2024 FCF +$105.8M; non‑GAAP OpEx finished $8M below the low end of FY guide; free cash flow positive in every 2024 quarter . CFO: “we converted 160% of our adjusted EBITDA to free cash flow in Q4” due to revenue/EBITDA overperformance and working capital tailwinds .
Platform and services momentum: Title & Escrow attach up >800 bps over the last four quarters; Compass One and Reverse Prospecting launched with early engagement; management expects CIRE (30–35% EBITDA margin business) to improve consolidated margins in 2025 .

What Went Wrong

GAAP profitability remains negative: Q4 GAAP net loss of $40.5M (vs. $83.7M loss LY), with $31.2M SBC and $19.7M D&A in the quarter .
Commission mix pressure: Commissions and related expense were 82.53% of revenue in Q4, +82 bps YoY, driven by M&A and mix of higher‑producing agents on better splits (partly offset by integrated services and affiliate revenue) .
M&A/one‑time items: $4.2M Q4 M&A transaction costs depressed Adjusted EBITDA; litigation charge of $57.5M in Q1 2024 (NAR) and a second $29M settlement payment expected in Q2 2025 affect cash cadence .

Financial Results

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($USD Billions)	$1.7006	$1.4940	$1.3804
GAAP Net Income (Loss) ($USD Millions)	$20.7	$(1.7)	$(40.5)
Diluted EPS ($USD)	$0.04	$(0.00)	$(0.08)
Adjusted EBITDA ($USD Millions)	$77.4	$52.0	$16.7 (ex‑M&A: $20.9)
Free Cash Flow ($USD Millions)	$40.4	$32.8	$26.7
Revenue less Commissions % of Revenue	NA	NA	17.47%

Notes: Q4 revenue +25.9% YoY; organic revenue +20.9% YoY; totals exceeded the high end of original Q4 revenue guidance and were near the midpoint of the Jan 15 update .

KPIs and Operating Metrics

KPI	Q2 2024	Q3 2024	Q4 2024
Market Share (%)	5.13%	4.80%	5.06%
Principal Agents (Period End)	16,997	17,542	17,752
Transactions (Units)	60,390	55,872	50,411
GTV ($USD Billions)	$65.0	$57.7	$54.0
Cash & Equivalents ($USD Millions)	$185.8	$211.2	$223.8

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance/Update	Change
Revenue	Q4 2024	$1.225B–$1.325B (10/30)	Raised to $1.36B–$1.39B (1/15)	Raised
Adjusted EBITDA	Q4 2024	$0–$10M (10/30)	Raised to $15–$18M (1/15)	Raised
Revenue	FY 2024	$5.47B–$5.57B (10/30)	Raised to $5.61B–$5.64B (1/15)	Raised
Adjusted EBITDA	FY 2024	$109M–$119M (10/30)	Raised to $124M–$127M (1/15)	Raised
Non‑GAAP OpEx	FY 2024	$876M–$896M (10/30)	“Slightly below low end” expected (1/15)	Improved
Revenue	Q1 2025	—	$1.350B–$1.475B	New
Adjusted EBITDA	Q1 2025	—	$11M–$25M	New
Non‑GAAP OpEx	FY 2025	—	$1.005B–$1.030B (incl. ~$105M from CIRE, $10M 2024 wrap)	New
Free Cash Flow	FY 2025	—	Positive for full year	New

Earnings Call Themes & Trends

Topic	Q2 2024 (7/31)	Q3 2024 (10/30)	Q4 2024 (2/18)	Trend
Platform & AI (Compass One, Reverse Prospecting, Make‑Me‑Sell)	T&E integrations underway; Compass Make‑Me‑Move planned Aug launch; client dashboard beta slated for Oct	Reverse Prospecting launched; Compass One beta live; continued AI integration	Compass One national launch 2/3; 14,950 invites in week one; +43% client engagement; Reverse Prospecting adoption; Make‑Me‑Sell entries ~9,500	Accelerating adoption
Title & Escrow attach	Integration focus, full integration expected by Q3	+700 bps attach over prior three quarters	+800+ bps attach over prior four quarters; aim to more than double 2025 T&E EBITDA	Improving attach/profit
Macro / Housing volume	“Historically low” volume backdrop; still FCF positive 4 of last 5 quarters	Market declined 1.9% YoY; Compass transactions +16.1%	Market +6.8% YoY; Compass +24.1% and organic +15.5%	Outperforming market
Market share & agents	Market share 5.13%; 24% YoY principal agent growth; 97.3% retention	Market share 4.80%; 20% YoY principal agent growth; 97.8% retention	Market share 5.06%; +21% YoY principal agents; 96.9% retention	Sustained gains
NAR settlement / industry structure	Litigation charge noted in EBITDA reconciliation	—	Management frames post‑NAR as structural tailwind for large brokerages/top agents; cites widening performance gap	Emerging tailwind
M&A	Parks and Latter & Blum added in Q2	Integration ongoing; guidance maintained	Closed Christie's International Real Estate 1/13/25; expected ~$500M run‑rate revenue; higher margin profile	Margin mix positive

Management Commentary

CEO framing of performance and strategy: “In the fourth quarter, we continued to widen the gap between Compass and the industry… increased revenue and adjusted EBITDA… accelerated our market share gains… and generated another quarter of positive free cash flow” .
Margin mix and CIRE: “Revenue, less commissions… as a percentage of revenue in the fourth quarter was 17.47%. Had [CIRE] been consolidated… we would have expected… ~18.2%, and… higher than 18.2% in full year 2025” .
Industry structure: “Post‑NAR settlement… the artificial market restraints… are now gone… the crème will rise to the top… which should disproportionately benefit Compass because we have the best agents” .
Inventory strategy: “As of Feb 16, 2025, homeowners are marketing more than 7,500 listings as a Compass Private Exclusive or Compass Coming Soon… ~35% of 22,138 listings are Private Exclusive/Coming Soon… 55% of new listings this month started off as such” .
CFO on OpEx and FCF: “Full‑year OpEx came in $8M below the low end of our guidance… we delivered free cash flow in every single quarter in 2024… converted 160% of our adjusted EBITDA to free cash flow in Q4 due to timing items” .

Q&A Highlights

Agent growth and recruiting edge: Private Exclusives/Coming Soon viewed by agents as a top listing tool; management expects this to attract agents in 2025; CIRE affiliate expansion already adding markets .
Modeling M&A impact: CIRE expected ~$500M annual revenue with typical seasonal gating (Q1 weakest, Q2 strongest); lapping Parks and Latter & Blum in early 2025 .
Marketing and OpEx discipline: Awareness for Compass One/3‑phase marketing primarily leverages agents’ 100M+ CRM contacts and in‑platform materials to stay within 3–4% organic OpEx growth .
Free cash flow uses and SBC: 2025 FCF to fortify balance sheet and reinvest in tech/inventory; shareholder returns considered longer‑term; SBC expected roughly in line with Q4 run‑rate .
Agent adds/run‑rate and pipeline: Targeting 600–700 gross adds per quarter with ~97.5% quarterly retention; M&A pipeline remains active while integrating CIRE .

Estimates Context

S&P Global consensus: Unavailable at the time of request due to data access limits; as a result, we cannot provide a vs‑consensus comparison for revenue/EPS/EBITDA this quarter (S&P Global data unavailable).
Context vs guidance: Management indicated Q4 revenue exceeded the high end of the original range and finished near the midpoint of the raised Jan 15 update; Q4 Adjusted EBITDA was at the midpoint of the raised update .

Key Takeaways for Investors

Compass is growing faster than the market and gaining share, supported by differentiated inventory tools (Private Exclusives/Coming Soon), strong agent retention, and a scaled platform .
Sustainable cash generation with tight OpEx discipline: free cash flow positive every quarter in 2024; FY2025 guided to positive FCF despite a $29M NAR payment in Q2 .
Margin mix poised to improve in 2025 with higher‑margin CIRE and rising Title & Escrow attach; management highlighted a pro‑forma uplift to revenue less commissions % .
Structural industry changes post‑NAR could accelerate share gains for larger brokerages/top agents—management sees this as a multi‑year tailwind .
Watch Q1 2025 execution: revenue guide $1.35–$1.475B and Adjusted EBITDA $11–$25M; investors should monitor progress on attach rates, agent adds, and early CIRE integration benefits .

Financial Statements and KPIs (Detail)

Metric	Q4 2023	Q4 2024
Revenue ($USD Billions)	$1.0964	$1.3804
GAAP Net Income (Loss) ($USD Millions)	$(83.7)	$(40.5)
Diluted EPS ($USD)	$(0.17)	$(0.08)
Adjusted EBITDA ($USD Millions)	$(23.7)	$16.7
Free Cash Flow ($USD Millions)	$(41.0)	$26.7
Market Share (%)	4.41% (implied)	5.06%

Segment breakdown: Compass reports an integrated, tech‑enabled brokerage with attached services; no separate GAAP segments disclosed in Q4 filings. Key service attach trends and affiliate economics are discussed qualitatively and via specific attach/margin commentary .

Additional Relevant Press Releases (Q4 2024 timeframe)

Jan 15, 2025: Raised Q4 and FY2024 outlook for revenue and Adjusted EBITDA; indicated FY non‑GAAP OpEx slightly below the low end of the range; reiterated FY2024 FCF positive .
Dec 2, 2024: Announced agreement to combine with Christie's International Real Estate and @properties to accelerate domestic/international growth and add higher‑margin affiliate operations; expected closing in 2025 .

Appendix: Balance Sheet and Cash Flow Highlights

Cash and equivalents: $223.8M at Q4‑end; no revolving credit facility draws then; in January 2025, $50M drawn with $100M cash used to fund CIRE purchase .
FY2024 operating cash flow $121.5M; free cash flow $105.8M; capital expenditures $15.7M .

All figures cited from company documents as indicated in brackets. Where S&P Global consensus estimates were requested, they were unavailable at time of request (S&P Global data unavailable).

Compass, Inc. (COMP)·Q4 2024 Earnings Summary