Earnings call transcript Q2 2023

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Operator

Good morning. Welcome to the Anywhere Real Estate Second Quarter 2023 Earnings Conference Call via webcast. Today's call is being recorded and a written transcript will be made available in the Investor Information section of the company's website tomorrow. A webcast replay will also be made available on the company's website.

At this time, I would like to turn the conference over to Anywhere Senior Vice President, Alicia Swift. Alicia. ahead, go Please

Alicia Swift

Good conference welcome Estate. call Rihanna. quarter the XXXX earnings for morning you, to and second Thank Anywhere Real

the Financial today Ryan me call CEO On President, and are Schneider; Charlotte Officer, Anywhere, Chief Simonelli. and with

and the statements As the be the are future and based company its during statements expectations presentation, other shown on about X forward-looking statements the this will environment. Slide results on current of economic making call. current These

significant control litigation. economic, projections uncertainties, industry and are payments including the to liabilities are in And and of inherently estimates incurrence with among developments. litigation, statements, other or that competitive, made connection subject in and which Forward-looking regulatory, are of others many of contingencies, excess macroeconomic accrued pending of beyond and the management, amounts

release statements Actual materially be materially differ earnings that forward-looking results Important today any sell, well say assumptions tender implied those cause those annual our offer factors we nothing or filings. in should from to quarterly or as in specified statements. expressed actual results SEC as solicitation may and could to forward-looking Note an in securities. that our are or purchase, today, construed and differ in the from issued as the

initial For you and XX, have those this that call. of are who remind of listen subsequent today, July not the to presentation, the to herein we earnings the rebroadcast updated as remarks made been

Ryan I Now call the to and will turn Schneider. CEO over our President,

Ryan Schneider

and invest set out even Alicia. challenging our of stronger results Estate line a housing to for Good market, the to expectations delivered you, future. morning, in midst Real an Thank we with Anywhere In everyone. continue

generated of delivered second revenue of EBITDA. $XXX quarter, the billion $X.X During million operating we and

results to seen especially results volume transaction improving sheet. commission long of $XXX our priority in our million And in time. track We with some best savings deliver capital we Our on year-over-year better we've remained our the to on of structure, leverage our expected line this and agent balance year. came focused than was cost with are estimates, closed in a our

And terms. invest franchise today bondholders, business, with expanding transforming leadership further and and similar we as the transaction which we our we to and a exchange and And market housing simplifying into our continue position on from cost announced a base exchange luxury high-margin of Estate Real the drive conduct integrating one to includes importantly, our a position, Anywhere both lead experience, our offering strategic to our transaction our to broader growing benefit stronger future. to agenda, intention consumer debt

Now With and starting market, year $X.X past over the a to decade. tough like look remain our cycle. behind with it six of which unit million the annual if level be would months $X.X And the heading future, transactions, was we the consistent Recession, part QX far in the challenging by us, million we've looks since are a expectations XX% in we reductions this aggressive metrics unit actions the a that down our transaction with But not year-over-year. volume come for you. planned seeing with volume cost investing we and low mid-XXs. XXXX, our we in both industry you is of the lowest towards Great transactions shared seen housing in took for

be declines driven, markets. all almost unit was and saw pretty our consistent decline across we The unit volume

as creating were incredibly even flat seen prices tight mortgage supply year-over-year, this all higher basically we've rate environment. challenges, Our in home inventory

consistent price price by few results. Texas a with trends saw in the and markets, prices in quarter two down particular average York, we increases Florida, New see versus year. the of country, digits, in we trends. in last our bigger significant But Across X% geographic the thirds mid-single about and of our about like California first saw including large However, variation states we on

compared improved as prior to positive, volume in the and more full XXXX the persisted. have in volume the Open guidance. all in both market And month our more quarterly get our volume of is positivity detailed continues And the each prior XXXX comparisons has in to quarter. look quarter, year little this trends with each And consistent compared easier. better comparisons the a year month as to and portfolio to year, QX, than closed

including the the advantages, challenging industry nationally and best level of insurance. franchise Now, is industry, Real some our affects national brands, opportunities octane brokerage, field, playing title, high leading because because unique assets a business and fact mortgage having that market establishes like entire and end-to-end of our it Estate positioned housing six recognized the our we Anywhere prosper from to with

lead important And position on we're anywhere harnessing scale. powerful for long our ever and time generation is when priorities Our market impact even quality lead is ahead technology strategic a term in to than generation charge a tough success. high our at and data more advantages these

examples simplify, streamline that changing and of deliver our first, laser on help automate operate efficiencies include, Some operations. we are to we that focused how

our We and to costs in $XXX cost of business continue of out make to take million XXXX. considerable transformation expect our progress in

share on will Charlotte this And shortly. more

the support capture for Second, us transactions it businesses. make estate brokerage the and to economics we simpler those be to cost we and to our make mortgage operations are title and integrating agent streamline effective national as to for consumer more title easier and real

significant business. put and our growing into love powerful effort franchise we Third,

Anywhere recent its record success, of franchisees. Brands innovative strengthening providing sales the proposition is Beyond value further by franchise and to new years offerings

to results technology our product. Affiliate and launched Insights is Anywhere now recently via franchisees help our As better achieve one our scale data example, using

by product migration the Anywhere's our critical data opportunities from franchisees business on growth, helps And and internal new external to drawing on base, their I run extensive other demand individual on on I'm topics. agent This better them insights provide and actionable love cost franchisees. their hearing on

leader analytics we're Finally, leveraging industry innovative technology our data an the unique Anywhere is scale. and provider

and opportunities the on to being language this We forefront and using committed new we're finding of industry. in exciting our are generative world models large AI

using Now, enhance our backwards, to we and business. look the we've you insights machine the been if analytic like learning

the And me heard are before. agent for with recruiting estate's we But large real forward, future. so example, learning today real model you language machine power you've talk seeing models I'm about going for have

real renovations, augmenting including and are to multiple estate executing this of whole simplify And explore example, designing image-based and And to intrigued For proofs transaction. well marketing, opportunity very innovations and we marketing starting the concept other virtual campaigns. the as photo by opportunities. like these personally I'm AI as

technologies early have pilots a helping efficiently. more software our days. still about really language the where code And employees. models to have in we accuracy. of few our differently. even of excited Now, support company output are us opportunities ensuring looking our analytic our at these importance AI new engineers E.g., large also technologies We early we're new E.g., generative run already experiments using the these are these people are providing to given these

And the new we excited both to broadly. on every these these have specific data committed being real know our how at work forefront it. a we're will And But and estate on we're do train and really of operates. to We models technologies industry company change that about journey. lot to of tune data more

now, to discuss closing more a back later to to to results with for So I'm our in come But thoughts. detail. Charlotte few going I'm turn going over it

Charlotte Simonelli

everyone. morning, Good

second drive improves. which us our to focused what believe housing market with efficiencies, to we actions structure. pleased are market expected. We capital sequentially, improve prudently operate, continue we control, differentiated performance well results being as up on quarter given reimagining the us dynamics We driving cost opportunistic the can remain how and will these for managing cash, enable on and set our when We

part transaction versus and decline. was line operating versus our in will quarter second our costs, year transaction QX results. Now which XX% down offset agent was prior QX commission million EBITDA in capital I we and which prior million year volume the and in highlight a some volume across managed which higher to were revenue flow due slightly cash revolver $XXX with down financial enterprise. used lower $X.X repay our our our $XXX today. business stand by prudently way free we partially cost with $XXX at cash, allocation savings priorities as consistent the in borrowings, to invest million was of QX

benefited lien exchange to XXXX new a for offer $XXX in agreeing capital Consistent from securitization allocation reduce improved to and notes the on portion with priorities our similar XXXX we our cash notes terms. one XXXX quarter and morning XXXX opportunistic financing working transaction senior facility. an and the and secured our approximately approximately debt, this the announced bond with pleased the XXXX million holders exchange million notes intention relocation with remaining capital conduct our Free flow are $XXX we second of to X% for of of in their

these deleverage expense mentioned, flexibility minimal annual interest Ryan retaining while opportunistic with As incremental way an we as forward. going view to our cash transactions

on Now our segment performance. let me business detail go into more

Our includes $XXX Anywhere and generated Brands which million in business, operating relocation, leads EBITDA.

EBITDA transaction year-over-year due and $XX marketing costs. in offset lower declines to revenue decreased to operating related volume Operating primarily million by decreases partially

part marketing was prior and year by commission and lower Anywhere in operating expenses. down versus EBITDA volume costs QX due operating lower offset Our million Advisors million $XX negative to also slightly $XX agent higher

Commission splits the QX in was than were better basis in which up points year-over-year, expected XX quarter. we

lower in even have competitive luxury, our there business, our proactively our managing advantage were backdrop parts in even splits. improved and quarter. than prior been the year are taking of an especially Also, splits where We of

operating services Anywhere $X JV refinance by improved year-over-year was million lower lower savings $XX integrated million declined initiatives Operating was partially purchase $XX EBITDA million and due performance. volumes, in to which operating to EBITDA QX. cost and offset due expenses in of GRA

driving we and As how and operate is we lower to change continue efficiency Ryan costs. said, that

on me cost about structure. provide I additional cost Before detail savings, overall talk the some let our

In expense related about were related office about billion. and line totaled total, $X XXXX, about this G&A $X.X items operating, and expenses $XXX headcount Of expenses million. billion marketing, were

is As about of our come savings represent majority the program. most are expenses, savings XX% our of this our where and cost XXXX of from these

since headcount For estate transaction example, our real services more June and reduced offices footprint, support XX% with in And efficient, integrated to flexible, and the brokerage we be efforts our estate real XXXX. are to our reimagine on have we transform by mortgage. focusing entitled

We year the of reduce about already title XX% and expect with most by brokerage this to actions footprint completed. our

million expected savings, program. to consider million a be of of realized cost two-thirds the slides huge year $XXX inflation combined $XXX by have savings costs. cost details. to accomplishment. expect our not by year our savings million litigation throughout These refer XX, and realized pretty approximately a return savings evenly full Please we $XXX Between further realize we permanent increase. part be when XXXX is offset will which XXXX and in and volumes to savings, will and however The approximately and of be for XX Year-to-date, we XX, will

here we year. focus our in to better our And Our how experience achieved out day investor our XXXX last delivering a work laid reimagine our to while target reinforces nearly and commitment cost agents customers. we we've that savings

Now, updated for our onto estimates XXXX.

First, in transaction volume of be expect versus comparisons closed the prior sequential the in third improvement we year-over-year by year. is This QX down about prior to XX% volumes year. to quarter driven part easier

the We year points. basis Second, of our competitive based split we this pressure XX in on full about experiencing. year-to-date better expect the we're trends, now and actions trends, really improving volume the like split area, XX environment to

our last call. the remain that same as Estimates

to full better we part to XX% and transaction volumes expect to of continue For year-over-year the XX% about towards that year range. likely XXXX, decline

sequentially will throughout We expect year. the also improve still volumes transaction

transactions flow cash other as expenses cash We tough non-recurring management working robust be and capital, this expect the capital, our impact free cash year of will operating programs, modestly and housing. the excludes counterbalance This from discipline our to savings favorable exchange any positive items. debt in

of Finally, savings realize $XXX we XXXX. are track on to in million P&L cost

turn now some remarks. the to me Ryan back closing Let for call

Ryan Schneider

Thank you, Charlotte.

how reflect enhance to the in we and to tough language our quarter about as our I'm I quarter, made our consumer analytic on AI models. this business differently, market navigated the we as large housing I'm results. we reimagine deliver second permanently future to for progress leadership the And environment of excited proud So cost and up team the as and the our with generative base agent to experiment operate experience, rebounds, to when growth streamline set greater

optimistic what's employees, moment agents, this with future. remain over market real I seizing term medium we're our our Estate the franchisees, ahead, housing ability Anywhere Real to to position into looking the the to and lead move estate affiliated to Together Now and about next.

that, take your will questions. With we

Operator

[Operator Matthew with Instructions] Your Barclays. first Bouley question comes from

line open. Your is

Unidentified Analyst

Good morning.

Elizabeth from team have it You [laying] on Matt's today.

had splits trends. just off, commission split Would kind you And a seeing, luxury of the starting term, higher you splits, how overall just around And of details of the if in kind I commission you're Just you're talking thinking mentioned could that maybe expansion the market. splits wondering end kind was moved agent you mind splits the tools? agent little few about offer around with the what comments versus about longer bit a balancing down. of

Charlotte Simonelli

Absolutely.

the benefited have and is in we're But basically, because is environment what still we to recruiting retention, really we're it prior much from quarter has few So quarters and not, a as to the improved, we that, that. while add nearly years seeing not having competitive things.

off we, So as of better. season, improve majority it because rolling lesser as years the on a prior retention. the and And the to the we're environment is impact split recruiting volume we into continues has competitive basically the come just we're,

down prior some like luxury actually different quite And of I brand year. side by are actually versus plans split is side, luxury brand. On the our the all mentioned,

Some plans part time brands. same the reset all we're for of actually year-over-year where that's in we're benefit being did bit some down. split the at seeing January of our And actually

we environment. And agent the the absolutely. it So the overall proposition, competitive trends, relates as value like like we to

ways commission split. lots in is agents So value of other to to that there's the provide not

think that referring remarks. some to his that And Ryan's of helps in overall. balance I prepared definitely

So focused future. absolutely there. call on the out something for we're good That's

Unidentified Analyst

what follow But, such. on been or rates mean, a they're have of top then making issue. kind today's kind for buyers if up, an a buyers? saying But do decision it have is that obviously, is making major on they've a of that just on pulse volumes I view largest the seeing market? of inventory is I home are, issue? and inventory And see to you home kind buyer are kind decision where mostly of pressure for where you for, know Okay. in don't like the concerns agents

Ryan Schneider

kind for a out bunch great hundred are. the Look, world people plus the agents agents XX And at them hear in for of on It's the Thank want world is just to. a thousand biggest we, here Elizabeth. the, of with obviously, as and right? in us they rates that Yes, of the clearly it's just we barrier with tough such question, a to it's mortgage supply need is or sell, you there support more from thing mortgage So to buyers, a it. the a you pulse And X%. X.X a interact asking so have out that mortgage just just, limited. U.S. of when would lot and of whatever of I couple supply regularly, have where, below they with comes now percent houses rates

there at with to a to want mortgage there's so people challenges at houses And buy houses who and rates lot even higher the affordability grace of relative supply. out the for

lack just a very market are the why transaction low transaction the referred choices kind think it's of thing the to, with get actually is mortgage thing help right is low. of of that script, to lack that But so being the is challenges of that's big just dominating And frustrated there. And agents, so can this biggest quality is in supply that's now in in the high housing I critical. rates generation, year I a my supply high piece buyers do with lead out we our anything why tight,

Unidentified Analyst

helpful. really That's you. Thank

Ryan Schneider

you, Elizabeth. Thank

Operator

comes question next KBW. Your with from McJoynt Tommy

line Your open. is

Tommy McJoynt

morning, my Hey, for taking good Thanks guys. questions.

of just expense sale in I million too, savings remain type power action. extent around the the market perhaps guess and put stuck market this to market Can all model, you about the the of sort this $X.X housing what is this one been maybe us in think earnings guideposts your existing EBITDA just first is The some that home having does power help to fully of fast-forwarding backdrop? of

Ryan Schneider

Yes, question, sure. Tommy. Good

both starts is stronger, So, that, absolute market look we to more to there the of the last committed talk transform about that when obviously may year, darn $XXX a cost relative should the Charlotte it taking our the a year. are in we of actions way we're the earnings standpoint to referenced The million our this digital, the is kind today, but competitive good. easiest market's basis company referenced, you the from anyone of not stuff world. that million lot kind day results be the EBITDA more look no you and EBITDA and growth, for be we're our And with look, think look and about And at right more in future, grow pretty what show simpler, if an in to that today's you right? to going automated, driving it, more but the you matter industry on $XXX

opportunities in would big our a working our revenue bucket. that's there's market some add this bottom we've of to been that But even So line. also the on and to more

even If the shoots more this tough And the of you that EBITDA can transaction opportunities economics bring in mortgage into that creates investing that transaction title early that. at think for like on today's the in about ecosystem, integration market. we kind levels, green we're And us. still upside

again, over whether the the things of it's consumer or some lead of some to talked still area that, our investing now. economics or in so kind right things we're in then And we've those about the specific and year can other last consumer the those add insights, of

in grow to gains that, thing in from even our how areas do flow. like about free well a to as low high even you down grow EBITDA and to even that we're market. the add then our using remarks franchise those And middle of, cash octane trying have tell margin talked we're growth the a will the in business, And ability like in I invest our in in this can pretty to market, luxury, we market,

shows we those this flow meaningful generate as enables also, cash EBITDA, things. meaningful free that But quarter generate

like like, actually housing housing we don't tough the market. do better relative rest we a a of well positioned to to think so tough And much we're market, our industry, but I in

Charlotte Simonelli

years. down years two, markets housing XX tend last, And The don't they you the forever. to if years, last three-ish or what, XX last over look

And so us to most of doing, are the are savings benefit permanent, going that into future. the which we're

we're that's of focused as well. how kind so on And that

Tommy McJoynt

to industry questions. can you at I think just understand of lot the like pending Got to the it. But can't what's second the where because this the ask commission-based opine And getting uncertain litigation. I we want we're area about it's see I actual think on action then frankly a us commissions, class on yours of about Thanks. do the of, question, about? business is were help what of a you outcome widespread decoupling an impacts the litigation litigation is which agent if heart buyer's model a really

Ryan Schneider

is this of understand, participation Well, nature litigation participation rule. the mandatory I about, about as of the it's the

a believe sever These a could offenses on liability. including in our we're dispute very do. I'm a going I lot going on trials we're got it out antitrust strong stuff, the cases think the coming joint and of to But, uncertainty. to on. to and speculating on which have co-defendants what that this substantial trial We've it. vigorously class and lot not this ability we them. themselves, belief And focused October actions speculating and against focused have of is of in have up defend We're come we we've a got pretty allegations vigorously. of kind litigation But very really defend

just the our good Tommy. on of We we'll at always should queue. you a darn good, be think pretty developments. do we it leave job latest And there, probably So people updating looking

Tommy McJoynt

thanks. Okay,

Operator

Soham Bhonsle BTIG. with Your next from comes question

Your open. line is

Soham Bhonsle

continue time, sort coming this doing Thanks sort you my as go more, the one Should to than is Hey, the these good and sort guys. the on and a based think see, on of wash, I of we first down over of principles being being opportunistic or deals? taking interest the questions. wash a on in program. of morning, here, to expense do for being debt market then exchange want Charlotte, just forward this

Charlotte Simonelli

I this see Yes, interest nominal do I is that did incremental a that, expense deleverage, over this it. been like way forward. we past kind and going great of reason that's of as We opportunistic. a my mentioned and prepared done this do remarks, so trying to the very to mine why similar as in that's see as a deleverage reason try really to really we've the few transaction, philosophy done years, this primary the so that's we've that's, highlight

Soham Bhonsle

you and that half and things from I are that down, guess, maybe guess, just sort bit thinking you and how I guiding the mortgage confidence about industry the that hit sort down of of things so sort XQ, XX%, with Ryan, transaction those in Okay, sort that, suggest improvement seeing slowed that I volume, what's on volumes, a of on to that the like June, giving guys XX little is think in of are hitting right of and then, so of that guide? implies right back the side, line we're

Ryan Schneider

kind ways, just Yes, of seen market, it, it mortgage the we've easier number continuing, in around of the guess some dominate that to April, of was June, true May, that's I different mortgage of comparison, to the through also within better, so, guide, it kind two May, of we're XXst than the benefit let's of true closed, some let of all you. last every, other we're it's are in with so we're trends in so, move was of kind I the comparisons the consistent the seeing far stuff July in basically like doing in quarter, that happened but that we year before we're I with opens and July or July data the not our, that look numbers gave keep last the look seeing the said, weeks getting Friday, mean, going having so true kind true call the data was but the are effectively, getting, June, the what that the we're June April, to in continue portfolio better was true it true that's it been in having our

expectation should that us the of. out year so have the Fannie and it's data of kind what's like all look so when of X.X million XX forecasters have, seen us just at stuck much year units listings we some the July new have of so have of big have opens, you some of the have, with, that but ecosystem we and but kind so that full guidance in of coming of that's toward that then basis, Goldman part versus geographically the kind bluntly, at data it of Sachs million whole full last kind we state, in, decline kind trending and think gives we and swings of units range, coming and that that Mae kind pulling data, is of we that to us our and nationally, we range even it good, we we XX% appointment we're we we're sense have pretty most around the And we on end the year, we're we have of all every then seeing again, from are of a the landed to of that we we X.X better with it, XX again kind better have who data, for the that's at year, of have consistent of thing, kinds we it including that's haven't kind data, the that

Soham Bhonsle

is just environment, agent Ryan, more can could I maybe on squeeze the other good models the in out on about competitive maybe here, but service sign what there? broadly of obviously yourselves side seeing splits you or just models full between sound independence on Got Just sort recruitment versus like it. curious that. talk one And if a you're the

Ryan Schneider

fewer, there trends you're in front. you data, saying I are now at think Yes, I the look, that industry data two mean, industry look the if right agent

moving So competitive than or one any better is fewer piece a are now five the environment. that's of moving six the in been past there And agents years. have clearly time

The COVID the we especially typically other fees XXXX. too in industry leaving and happening on stuff and by agents, when the thing saw that do. stuff, non-producing you now get, frankly, like way this lower is, front the in And and licensing agent fees agents QX right

happening. the And of first to. And those kind think both on Charlotte everybody's mean of trends referred easy I is of competitive doesn't recruiting. still partly environment so there. are mean because And one focused not it's better It out the doesn't

little, I better But it's And it very ago. We're focused years years on it. sure, or year a a different ago was, than than it's was so again, for ago. four or three like it even, think

pretty from net we the others winner other market. the, competitors like numbers. who, pull a to comparisons. of play And some we head more higher those like We're there's mass Charlotte of that some head of our against, And there's often we much end. And with full companies the from in spectrum, industry, in shows aggressively look because up our in the results them. much we more who that talked all the about. pull then And But compete of when some big certain

don't a in stuff even that some tough have. we we And companies we experience some market, of lot assets and got a have some and some, both financial

a like we're so, up in success lot even market. the us Charlotte agent including for to doing, on said a we're And greater set side, trying is stronger of what

Soham Bhonsle

color. lot a the for Thanks Great.

Ryan Schneider

you. Thank

Operator

Paolone from question JP Anthony next Your with Morgan. comes

open. is line Your

Anthony Paolone

Can one down quarter, the guess median if just Thanks. looking Good up in morning. on on the just about I using differently? I'm do at down share Are Like ‘XX. first side? about you is just And are it side. you following the is looking you the share I guys guys guess at NAR I competitive feel ‘XX. the like landscape, you just guess price on lost data share? comment is just, you that,

Ryan Schneider

two price numbers But, look were remember drags, California We I don't think we was down know two mid-single were down the our I feel big ‘XX, Tony, markets. if portfolio from that. kind those everybody. said any biggest I our in even [XXXX]. down prepared the in especially way, a on. NAR New true York And remarks, in we're those But by are there's and for right like side I mean, of rounding the digits. are

little heavy when we're don't the So to keeping little you've NAR, if of we're reweight worst kind the it, like I a has been thing I to don't to and holding know. down probably us they're we're we're two me kind I But in if that's that so, share. when like ‘XX, right know in reweight maybe around we And of But, we're, got a you down at them, want basically number better. map of better. a and bit ‘XX up think night us in it little kind kind maybe geographies, I watch share. a not of, bit. feels

Anthony Paolone

the And not then, as accrue Okay. one, Good. the second to a to for sense whether give G&A, in on Thanks quarter? or in continued that. lawsuits you you can

Ryan Schneider

Yes, any quarter. we accruals do didn't this

several You class litigation matters, the got to remember, the there's accruals cover actions.

to quarters non-cash do quarter quarter. including of charges, about accruals But other We were with And type the But, We items, don't incentive have unusual out any strong or it's non-cash a accruals legal we we you're having those nice talking things break three also charges. headwind long-term in in row recurring that. other non have, doing operating a not accruals there. done, those where didn't a a accruals, the couple our of extraordinary comp, other out. to other do aggregate performance, our where we're

didn't in quarter. table And keep development we the updates every And It we quarter Tony, show have accrual. XX-Qs. is that the of this in quarterly a was litigation But, required a complex. big an evolves you litigation that our the X(a), where our But, release. aggregation in the providing discussion press we'll group

a without should of accrual quarters. we've previous you But talking out. this check in kind So always the those some was been about quarter

Anthony Paolone

Okay.

said? understood So, you were quarter, it in but that. accruals But just I the that is sure what there makes other

Ryan Schneider

No, nothing, no, no, no, nothing, basically, no, no.

Charlotte Simonelli

have do down year. look to moving there's you the prior savings. always G&A versus on pieces. Ryan's cost other But the it's point, if And we other, at there's And quarter,

Unidentified Analyst

the you having if those exchanged, Okay. And just the, a is in Do a I of for one lot that gain? some there taxable just does you given then is general business on Just to how get I the year? understand. on work? exchange this Or get, anticipate guess you offer. last cover weakness year? that this the pay taxed do bonds that

Charlotte Simonelli

announce We to Yes. we did offer. that do an planned

there haven't We gone yet.

can if based were So you by to evaluating that the I there's I'm I about look something that obviously on that much tax law. and if time. to full And that getting we're the of not those things, can at really be say case, happen, but this we're, can types ahead in limited be there what securities say of. if of implications structure was moment they But there's at really

Anthony Paolone

Okay. Thank you.

Operator

& Your McKeveny with next question comes Zelman Ryan from Associates.

is open. line Your

Ryan McKeveny

sides, terms if I'm and Hey, your homes there. by for more how of skew around scale, can you're there's point. side, side And think questions. then maybe a and thoughts back size I'm market, and can listing new between given by price anything taking just pace total guess in thanks it's I your of takes curious normal to any you a of my transaction their rough what or to terms sides or have about get homeowners listing to start, but on I good assumption and the baseline listings guess do market that coming actually curious And specifically what to XX:XX, it or you whether maybe add buyer you share seeing listing a is splits between if it's morning. one the breakdown guess in I

might kind green encouraging Just listings, more or signs you shoots that seeing to suggest will any be there's market? of to curious coming if be the

Ryan Schneider

Yes.

biggest would data seeing in an referred home at probably expect more listings So, pressure ago, listings the given a about, size scale, on right July rest Ryan, down that look, you than assumption, the versus improve talked look market market. the listings, the as XX:XX in question, a of buyer, July it's the year to versus earlier clearly buyer we've is we're mass we're in supply side and listings if in our as way luxury the seeing totally sell the you and I first-time on and issue actually

in, product, on XX% got kind people that, that's on this, I the it to our at mortgages people of X%, is I've point home strong look buying to of ton with obviously into moving X.X% going resell the view little that XX-plus X the there's pretty and luxury spoke and who, ago, down builder X thing interested communicated, of home mortgage I or have that in what have and very but because I to moving rates leadership mortgage the, month So a people mortgages was of and of the or XX% the market, rates, the because what it's some a inventory that they're a part really in especially think it's, to Ryan below green they're we're builders here four, in one they're price we're I seeing of percent take, We the also the earlier terms position, rate. X.X%, is CEOs. percentage shoots product of below one referred of

so issue, an that, some it XX to In they'll there's mortgage affordability days are a house in buy X.X%, clear to want could fact, not move if so guys those being side and downs on mortgage delivered me next product evidence rates, down to buy CEO their told ready it's unlock the and I'm down, are consumers both they're X is more that, on market, they're even not, mortgages of they affordability, on. buying and to are X% the some terms really that of supply and mortgage me down, it it focused the tough really kind both so supply mortgages buying for X% tough to without in rates what any the buy, X.XX tells X% other and to but me real X.X% that, consumers for take side, to this there at bringing to in then absolutely those would, buy, demand but to

invest, real that Now, can normal to what willing and this do both rooting and builders. about more to what homes some the with We what octane excited our and market, homebuilder a cost really we're flow, for market, the it, again, with in to look the, our are home ability the moving even get could on to changes a all with other actions but but, free a gives, think innovations our we're of I tough you quarter, that see I'm much, imagine going like. do earnings, our doing cash right, in is path consumers much, obviously gives all us as

Ryan McKeveny

helpful, Yes, Ryan. that's really

I thinking is markets? homeowners biggest just on, in you've different of these the out in, guess question, of entities I sellers of it's Second the and pulling of curious seeing companies point, this insurance as about, some so and topic buyers agents how been or we've homeowners some country. few markets? guess times, is out at if a sale of you're the markets. those mentioned And all some pulling not activity it more of and in point recently focal home bigger I one kind markets tangible of one California other state as of guess, well seeing is a impact your those and on of insurance any you're parts headlines of this

Ryan Schneider

come it. And really I'm great it's lot. agents of a watching cities. Florida on it in come franchisees. doesn't It hearing headlines there's we're up and does is California. up lot. gets a mean not not, of just a a a really come this just little it's something It issue, more not Yes, doesn't tale question up though, or two doesn't Florida from about kind That even

of than maybe to greater they're talk because else the and see kind properties the the anywhere that price more for U.S., like share thing point that there do you And And in than few not of hard City. kind just probably New the remember are California about. York has other higher we both reason in luxury insurable, a thing sell basically,

advantages, is anecdotal, I the day that about Realty these at unlikely Now, show kind example, up as with just advantages, government et pretty to a our, with I've something in taxes really watching. talked of headwind any it weather it's, kind end for a, isn't the idea have think home put the it kind we're and state the it to cetera, one is the Southeast in California last tax in I of just the forces Whereas, along yet to quarter, tend going but insurance the of mean, from another one But U.S. in of Leader of to headwind. it's other thing. be market I available a International things. Florida world, doesn't its

but radar bigger versus like on the radar the it's issues I at probably some enough do notice. there's Florida So anecdotal that when comparison. more look you but But the California on again, anecdotal,

Ryan McKeveny

Got it.

much. very Okay. Thank you

Ryan Schneider

you, Thank Ryan.

Operator

Your Stephens comes John Inc. next question Campbell with from

open. is line Your

John Campbell

Hey, Good guys. morning.

Ryan Schneider

Good morning, John.

John Campbell

Hey, good morning.

environment. I On still business, obviously, operating tough the mean, brokerage pretty a it's

obviously so sounds growth, pretty extensively you know business Charlotte, a you a down the self-help for think call cost drop a brokerage to splits, this there. million year-over-year. it $XXX on you there's But $XX is lot bit of pressure. million little clearly, less like a segment. had, I saw But only spoke in that's I revenue the or very EBITDA high variable saves.

back you helpful of is far much saves by of growth, going But And the and breakout think could be kind the as if degree a that where of of call like there? towards very spot good saw in maybe is that you business maybe get you margin the to then the segment cost-wise XXXX the question nearer disclosures remaining modest I talk kind or segment. got do to feel here could to, brokerage throughout geared expansion of my you if of directed as savings is, more term, even how just and the brokerage maybe you've

Charlotte Simonelli

the Yes, $X market, million of housing part most more Yes, earlier. I first. the pretty a north savings at last when of because we we goes take believe answer to us benefit do I'll absolutely. are markets, are permanent So it kind will these gave definitely which housing low sizable normalized are and and they I historically get cost to of that

our on yes, of that, the other we on then feedback this really costs of additional things for the the give lot been out a come to brokerage. thanks of to like, taking and highlight the to We've and majority tried so going are here sort that slides. savings because far, occupancy It's people-related detail are of year this, and of feedback cost

Now, updated giving quarter. this numbers we're not XXXX

Clearly, from more likely majority going the me to to more be, constantly the mining costs later basis that we're there's of brokerage, business sitting of are, in just come. title, on and about etc. where costs You'll hear the year, to the across this but have sort

like more and this delivers constantly mean time looking the big at will now even beneficiary the believe the when lot But business gets doesn't also market we a for we're housing working our of ways to make a efficient. we're our agents at magnitude better experience of stuff and that an we're normalized. do to our on our of margins we be same more the our that customers. that We So savings. done And

on the see and follow of different are we've G&A line to benefits that in magnitude marketing P&L. what operating happy can items of because to you done folks and more see the actions So sort that able on that. But of the the of the

John Campbell

guess, that's helpful. the, one on I back can tables And the then, in out, the legal the you very Ryan, press late see expenses, this the in pointed but Okay, release. you definitely of add-backs

secured senior ratio the see it leverage there. can table, think I you

you to obviously up mean ago. You half, are months, if years there's step year EBITDA. XX I last and been over, back maybe adding a to not mean, pretty two operating that look guys a the substantial relative a I

I basis. think on have month a stepped a last look from you're it like you down if XX it at and there. XX might looks But spending it quarter, clearly, lot

ongoing but that a an step provide know you I there, down kind I lower Is know you So spend? crews, detail but spend? don't their can of that to on basis. how legal and was much talked just

Charlotte Simonelli

other that much were and we so there incremental not It's step spend was a it reserves that did. down than no

always that in but year we're something material. there's sure had I'm prior stuff And we year-over-year. nothing lapping, the Now,

really spend. it's of other the new absence there's -- And incremental So then

Ryan Schneider

non-cash other non-cash charges. line that has got Yes, other or John, got remember, long-term unusual extraordinary non item incentives recurring It's charges. comp. It's

actually last that off the in down the just in change do talking little we quarter. number that litigation the table of went bit costs as not thing year yes, upcoming But were before. a is unfortunately we so, it's headwinds given from Charlotte the have one rolling core still things about. a few the said a from It's And trials. And cost

John Campbell

And talk mean, much I Ryan, the legal Okay. you know can't I guys more then just one side. on there.

So MLS, definitely of from bounds. don't as is which diverge the I NAR step rule, it think want Bright from the you the basically participation kind they're But, case. But they But MLS. rule. sounds update of I mean, to moral co-conspirator like named to the saw out in nation's the I the a second are that largest going

bounds proposing but as curious, was specifically you message try to I don't here, corporate-wise, as you what out on rule or of is Bright to a there step a official even maybe or stance MLS more participation the want is far messages So do? guys, to from coming again,

Ryan Schneider

don't on NAR's rule participation not talk we're Period, necessary. literally on record doing. think look we that mandatory We're Bright's is record what going that. John like we're to But about public public about

we've and So that. on a for been while record public about

it. know -- haven't we is what, we that that and been sharing should what everybody about have what So strong view shy

we're and a specific defend view. a everything. it's still and we've so But, thing them, and have on public And we got that going vigorously these to, view trials

buyers is agents, I well. here. agents stop well geographies We and the And operate really So real in sellers necessary we right on the to consumer. rule think don't for for U.S. on for have value there's the commenting for both And think that mind rule there's for create they homeowners. that Mark don't and don't it, it consumers, for

on we're NAR's so rule record. don't think just And is again, necessary. we mandatory public And

John Campbell

color. for Thank agree you. you. with can Thanks the We

Operator

us conference this further for you time. are that, thank There now joining the call we and you disconnect. concludes questions may no at This today. With

Anywhere Real Estate (HOUS) 25 Jul 232023 Q2 Earnings call transcript