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AR

Anywhere Real Estate Inc. (HOUS)·Q1 2025 Earnings Summary

Executive Summary

  • Revenue $1.204B (+7% YoY) with a clear top-line beat vs consensus ($1.150B); diluted EPS was -$0.70, slightly below consensus (-$0.54). Operating EBITDA was approximately break-even at -$1M, a $12M YoY improvement, supported by $14M cost savings and luxury-led share gains . Estimates retrieved from S&P Global.*
  • Management reaffirmed FY 2025 Operating EBITDA “about $350M,” Q2 2025 Operating EBITDA similar to Q2 2024, and cost savings of ~$100M for 2025; FCF (ex one-time) similar to 2024 .
  • Luxury brands continued to materially outperform: combined closed transaction volume +16% YoY, driving outperformance vs NAR’s ~3% market growth; April volumes were “basically flat” amid macro volatility, with luxury still up in April .
  • Balance sheet and leverage remain the central investor debate: net corporate debt (ex securitizations) $2.562B; Net Debt Leverage Ratio 7.2x; revolver borrowings were $690M as of April 28, 2025 .
  • Strategic catalysts: proactive stance advocating broad, public listing distribution; accelerated AI deployment (agent productivity and operations); and continued franchise growth and luxury share gains .

What Went Well and What Went Wrong

What Went Well

  • Luxury leadership and share gains: luxury volume +16% YoY, with notable performance from Sotheby’s International Realty, Corcoran, and Coldwell Banker Global Luxury; Q1 outperformed NAR’s ~3% market volume growth . “We continue to sell more luxury real estate than anyone else, gaining share…” .
  • Cost actions and segment resilience: Operating EBITDA improved by $12M YoY to roughly break-even; Franchise Group Operating EBITDA rose +$7M YoY to $97M, with margin +300bps to 48% . CFO: “We realized $14M of cost savings and are on target to achieve $100M…85% identified” .
  • Recruiting momentum and AI initiatives: ~650 producing agents added; agent recruiting program delivered +30% YoY; piloting AI assistants, listing image evaluation, and automating complex documents to lower costs and improve speed .

What Went Wrong

  • EPS miss and Integrated Services drag: diluted EPS -$0.70; Title Group Operating EBITDA declined to -$18M (vs -$15M) due to volume-related expenses, unfavorable commercial mix, timing of certain expenses, and investment in expansion (upward) .
  • Commission rate pressure and mix: average broker commission rates fell modestly (Franchise: -2bps; Owned: -6bps), with more pressure in luxury given higher $5M/$10M+ deal mix; splits rose 39bps YoY to 80.4% .
  • Leverage and liquidity watch: Net Debt Leverage Ratio 7.2x and revolver borrowings at $690M, with 2026 exchangeable notes refinancing timing subject to markets; management will be “ready to go” but is watching volatility closely .

Financial Results

Summary Financials and Trajectory

MetricQ1 2024Q3 2024Q4 2024Q1 2025
Revenue ($USD Billions)$1.126 $1.535 $1.362 $1.204
Operating EBITDA ($USD Millions)-$13 $94 $52 -$1
Net (Loss)/Income ($USD Millions)-$101 $7 -$64 -$78
Diluted EPS ($USD)-$0.91 $0.06 -$0.58 -$0.70

Q1 2025 vs Consensus (S&P Global)

MetricConsensusActualSurprise
Revenue ($USD Billions)$1.150*$1.204 Beat
Primary EPS ($USD)-$0.54*-$0.70 Miss
EBITDA ($USD Millions)-$4.5*-$5.0*In line/slight miss*

Values retrieved from S&P Global.*

Segment Performance (Q1 2025 vs Q1 2024)

SegmentRevenue Q1 2024 ($MM)Revenue Q1 2025 ($MM)Op EBITDA Q1 2024 ($MM)Op EBITDA Q1 2025 ($MM)Op EBITDA Margin Q1 2024Op EBITDA Margin Q1 2025
Franchise Group$200 $204 $90 $97 45% 48%
Owned Brokerage Group$919 $990 -$59 -$47 -6% -5%
Title Group$71 $78 -$15 -$18 -21% -23%
Corporate & Other (elims/expenses)-$64 -$68 -$29 -$33 N/AN/A

KPIs

KPIQ1 2024Q1 2025
Franchise closed homesale sides144,775 137,089
Franchise average homesale price$470,119 $516,999
Franchise average broker commission rate2.43% 2.41%
Net royalty per side$417 $453
Owned brokerage closed homesale sides50,513 49,461
Owned average homesale price$709,506 $799,750
Owned average broker commission rate2.41% 2.35%
GCI per side (owned)$17,946 $19,720
Title purchase units21,325 21,349
Title refinance units2,025 2,504
Agent commission splits80.0%+ run rate; 80.0% in Q1’24 80.4% (+39bps YoY)

Guidance Changes

MetricPeriodPrevious Guidance (Q4 2024)Current Guidance (Q1 2025)Change
Operating EBITDAFY 2025About $350M About $350M Maintained
Cost SavingsFY 2025~$100M ~$100M Maintained
Operating EBITDAQ2 2025Not disclosed Similar to Q2 2024 New
Free Cash Flow (ex one-time)FY 2025Similar to 2024 Similar to 2024 Maintained
One-time payments totalFY 2025~$115M (Antitrust $54M; Legacy tax ~$40M; TCPA $20M) ~$115M (Antitrust $54M; Legacy tax ~$41M; TCPA ~$20M) Legacy tax slightly raised
Revolver borrowings (reference point)Point-in-time$575M (Feb 12, 2025) $690M (Apr 28, 2025) Higher (liquidity use)

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2024 and Q4 2024)Current Period (Q1 2025)Trend
AI/technology initiativesListing Concierge won Inman AI award; continued investment and efficiency programs Scaling generative AI across agent and employee productivity; automating documents; AI-driven ops (e.g., bank statement review) Expanding scope; deeper integration
Luxury performanceLuxury unit share gains; portfolio outperformance Luxury volume +16% YoY; April luxury up; sold 345 $10M+ homes (best Q1 since 2022) Strengthening; key share driver
Macro volatility/ratesOctober 2024 opens/closes up double-digits (seasonality benefits) April opens/closes “basically flat” amid macro volatility; price still up; days-on-market and cancellations flat Near-term volatility; price resilience
Commission/tariffs/macroModest commission rate pressure noted YoY Commission rate down slightly; more pressure in luxury due to high-ticket mix Mild pressure persists
Regulatory/legal (CCP, DOJ focus)Noted scrutiny and litigation risks in press Advocates broad, public listing distribution; supportive of portals limiting certain private listings; franchise private networks as niche capability Clearer stance; transparency-first
Integrated services (Title)Title revenues up; EBITDA modest Title EBITDA down (mix, timing, investment in upward); profitability improves with scale; some units already profitable Investment phase; back-half improvement expected
Balance sheet, refinancingRepaid Term Loan A; repurchased notes at discount Will refinance 2026 exchangeables when market permits; monitoring volatility Prepared; timing driven by markets

Management Commentary

  • CEO on luxury and integrated model: “We continue to sell more luxury real estate than anyone else… Our integrated business model covers every step of the real estate transaction…” .
  • CEO on listings: “Anywhere Real Estate is aggressively advocating for transparency and the broad and public distribution of nearly all listings…” .
  • CFO on transformation and savings: “We realized $14M of cost savings… on target to achieve $100M… 85% of our savings already identified” .
  • CFO on Title/Integrated Services: “Revenue was up $7M; however… offset by higher expenses… unfavorable commercial mix… timing of certain expenses and continued investment in expansion of upward” .

Q&A Highlights

  • Clear Cooperation and listings strategy: Management supports broad, public distribution (including portals limiting certain private listings), retaining private listing capabilities as niche/defensive tools; emphasis on doing “what’s best for the customer” .
  • Commission dynamics: Minimal movement with slight declines in both list- and buy-side; more pressure in luxury given high-end mix; agent splits at ~80% for the 12th consecutive quarter .
  • Integrated services investment drag: Title segment near-term pressure due to mix and timing and investments (upward), with profitability improving as scale builds; back-half savings expected to “step up” materially .
  • April readings and macro: Opens and closes “basically flat”; price growth persists; days-on-market and cancellations unchanged vs Q1 .
  • Refinancing plan: Company “ready to go” on 2026 exchangeables; will be opportunistic given market volatility; exploring syndicated or private options .

Estimates Context

  • Revenue beat: $1.204B actual vs $1.150B consensus; EPS miss: -$0.70 actual vs -$0.54 consensus; EBITDA in line/slight miss (-$5.0M actual vs -$4.5M consensus). Number of estimates: 2 for both EPS and revenue.* Results suggest upward pressure on revenue estimates given luxury strength and price mix, while EPS trajectories may be tempered by Title investment timing and modest commission rate pressure . Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Luxury is the engine: outsized volume growth (+16% YoY) and high-end share gains drove top-line outperformance vs market; luxury remained up in April even as overall volumes were flat .
  • Operating resilience: Operating EBITDA improved $12M YoY to roughly break-even; Franchise margins expanded to 48%, validating high-margin royalty economics .
  • Guidance intact: FY 2025 Operating EBITDA ~$350M and cost savings ~$100M reaffirmed; Q2 2025 Operating EBITDA guided similar to Q2 2024—maintains near-term earnings visibility .
  • Leverage watch: Net Debt Leverage Ratio 7.2x and higher revolver usage ($690M) underscore deleveraging urgency; refinancing 2026 exchangeables is a key 2025–2026 event path dependency .
  • Commission/mix nuances: modest commission rate declines (single-digit bps) and elevated splits continue; luxury mix pressures ABCR but supports price-led revenue .
  • Integrated services: Title drag reflects investment phase and mix/timing; management expects back-half savings and improving unit productivity to support margin expansion .
  • Narrative catalyst: strong stance for transparent listing distribution and accelerating AI deployment are differentiators that support recruiting, customer outcomes, and structural cost reduction .
Note: All quantitative claims and figures are cited from company documents. Consensus estimates marked with * are retrieved from S&P Global.

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