HOUS - Earnings call transcript Q1 2024 | Anywhere Real Estate Inc.

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Operator

Good morning, and welcome to the Anywhere Real Estate First Quarter 2024 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 available on the company's website. At this time, I would like to turn the conference over to Anywhere Senior Vice President, Alicia Swift. Please go ahead, Alicia.

Alicia Swift

Gavin. you, Thank welcome Call and First XXXX Quarter Good Anywhere to Real Conference for Estate. Earnings morning, the

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

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

other developments. other through forward-looking materially uncertainties subject from statements. April inherently contingencies, XX, Forward-looking statements, macroeconomic these month those litigation, the significant made competitive results are references in regulatory antitrust projections in and of among April XXXX. to which estimates implied of and to and may control management, The and to Actual economic, many are data expressed reflect differ the date or remarks others, and beyond including industry

open Our proceedings. excluding in days. the is segment, timing relocation of business discussion reflects by the these on and in of payments impacted an like-for-like core number franchise franchise The reference be to developments litigation volume reference remarks basis leads. can The the

It Charlotte's of risk. These of onetime and Free anywhere makes or provided $X splits XXXX pro range XXXX. financial sale are not the payments purely no financial increasing degree joint cash for assumptions the venture, Finally, to refinance business. but million Association forecast volume and mortgage legacy home for Realtors. excludes guidance rates, higher flow to illustration higher a National illustrate earnings, our sale by inherently in of a the matter. related tech joint litigation existing commission higher its and home compared as the including underwriter to financial $X.X of to XXXX adjustment in or million performance was to illustration to variable uncertainty subject the million octane is market forma reported high relocation pendant $X.X royalty environment, is Tech a $XXX XXXX venture market existing related home expenses sale million The anticipated includes

potential Important assumptions and communication, broker materially makes Additionally, to release as cause settlements the are for specified the payment assumptions this those our statements impact of negotiation to or regarding that of See antitrust in or quarterly reform additional our regulatory factors and filings. annual earnings could financial our actual SEC differ forward-looking related results forward-looking Bayer illustration from pending well commissions. issued in in today as information. statements no the

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

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

Ryan Schneider

anywhere estate's and excited morning, Thank I'm you, real to to Alicia. success value Good drive by for deliver our shareholders. everyone. position

to financial continue really We and in strategic efforts reductions through how should markets. delivery, more meaningful octane operate, of to anchored I'm about fast-moving how record we translate excited transforming And our foresight industry our demonstrate lead we innovation change. track housing the a cost powerful normal in as

dreams, achieve life a to their them with the homebuyers agents space value reboot to lifestyle for start in relocating first-time XXXX the day, and and The by meaningful big franchisees complexities. sellers moment search these While in employees ongoing I'm their during guide provide and for call time the help our navigate was the the want I first of retiree proud homebuyer, affiliated more estate thanking growing of quarter of housing another Every the how or helps come commitment. agents, the whether decisions. consumers, agents customers market. tough real family

is $XX low part difficult sales. the million XXXX, a first year, as negative and record Remember, into this market operating the solidly of was the target. revenue of of $XX housing But We the exceed operating cost and seasonally quarter we very approximately $X.X of cost a million of are we savings realized permanent and in on move target in quarter this are level slow with because unit to that very billion in hard delivered selling the savings EBITDA. EBITDA Now of our million excited positive. our and I'm track March we season, are $XXX year, to initial deliver working we

and XXXX company. focused to business, continue challenging in and to in invest remain investing business. debt our back for the us we the streamline given to position still Our speaking paying in pulling on capital of our who housing And are investing market, allocation future business priorities the unlike down competitors our growth

example, for strategic growing our existing of value our most So both one new network, for our priorities and proposition franchise by enhancing franchisees. important

new like We are title. bringing them profit sources upward

excellent with providing them our Moxyworks technology We are offering.

data We are help tool. insights to we their businesses listings them through affiliate reducing actionable their our provide using like are anywheres scale and insights to with better costs products direct our franchising run technology,

position. Another luxury sell strategic strengthening And are we leadership and point more million-dollar-plus we is remember, homes love our that than anyone.

brand Realty both to consistently gain continues as share the it market portfolio, of again and QX. rest outperforms in International Sotheby's including our the Our

as finally, corporate Portland New love expensive the new in in cities And with the important year, consecutive to expanding our market homes Our QX. brand Boston for preeminent online City on York we brand selling coming fourth #X continue side position franchise and most Manhattan ranked demonstrate in Corcoran America. the dominates the like we and the was and

other X we closed of $XXX market. under We homes Just to have contract with them and at sales through the $XXX fun QX. in share data X of X million-plus some of million-plus homes end highest listings the currently

our Now brokerage integrating title and customer-facing and back and and digitizing we're operations, both also agent office.

consumers creating high-quality integrated of the capture nationwide for available This consumers X/X lower someone the rates provide we time experience the closing agents win mortgage is value transaction managing of more and the win a this for them transaction process. assisting now and agents anywhere a else better themselves coordination our paying contract it's should our and close, transaction and seamless either hundreds it, about year. This handle rolled per and title as services focus more part on help of as help a as as faster, them base. to are a could We out is business. service It's should simpler of we U.S., by end will or that proposition, as a lower they mortgage cost frictionless experience. contribute for to and us saving should and should be integrated create from hassle for this win we so the of dollars our to new a more work earning transaction this And title in help a and capture service high-value

some and are the rates in We seeing already brokerage than service large seeing also drive above title to our better and markets back costs. available our locations. more XX% lower and consistently more offices service, and we're of of combining We're using usage earliest X/X transactions of in more to

of generative generative the of able of production continue parts best previous as As our examples to AI calls, I use our AI referred to this is we processes the improve company. to where across we're actually agenda in many one

recent our strategic really like investment assets. Now leverage exciting the and to some finally, opportunities of finding we innovative we're

homes reach, are that partner shifting First, are rental the creating to selling directly national their their and our as opportunities network high-quality integrate curated in to consumers, we homes. finding ability be title selling single-family for great us our to to are companies leads a

agreements, we sold new franchise QX, some with premium to penthouse. X $XXX a Angeles. with seller auctions Many Dubai Remember, And recent different similar our both collect London around hosting first-ever do be listed we X our the And internationally, also we're SIR to recently historic those not million innovation auctions Auction follow and Hong ways live the of Kong as recently real hosted Sotheby's buyer the estate corporate is about London in have our we XXXX. there master auction just later like success saw real City brands. and economic luxury And opened we in of home. and franchising. you million thriving commissions. next is we the more recently concierge seeing seeing auction In where Kong Greater Second, month, while business. for estate homes sell the International at international luxury especially York franchise don't normal auctions Hong a in along $XX concierge we New remember, we're a will been model auction. Dubai's live and brands interesting coverage our auction offices selling Sotheby's We've House, talk TV international that Realty much, homes with through different third, And and in Los expansions, in market,

has in hurting of And turn demand the quarter. up market toughest me market The housing. keeping the overstate challenges off the of limited to in that supply a how inventory issues. creating the continuation the prices hard clearly housing than more housing, showed overall, against having It's supply. to the years. industry in mortgage by QX was affordability rates of last XX the were and cuts. year-over-year book outpaces recent especially and an one XX% quarter markets put with of future more down news Now timing inflation in Unit which transactions are in we price rate high as QX our versus the XXXX market growth saw as the as to supply is let XXXX, That country continue headwind mean higher of and

with the Now as X% volume growth up of closed in X%. down in we've years our our year, units versus first X% about year-over-year was up seen prior was the closed price book, QX volume and quarter X

half both from segment growth again seeing it luxury International continued outperform market that Realty to up as Sotheby's brand our about the meaningly with outperformed closed of X% with the each And Our up year-over-year volume our month during because represents portfolio. about new future was open a improved the closings, future and I'm which and more quarter. volume, our optimistic year-over-year contracts and little unit

volume in year-over-year. April, X% up is And so far our open

X% units. growth a as in first in is really year We up This areas listings. see meaningful million-plus New and improvement how portfolio in in listings more we with growth the luxury time growth growth a ago. excited we And to listings were growth. a are beginning quarter. piece in in York, have that is saw our the XX% that California where brokerage we're us differentiated And like of years quarter saw owned increasingly $X businesses seeing coming listings versus in We for improvement up listings disproportionate year-over-year our from of we're some about couple the in

I and still financial clearly market in the quite for octane is low we're be at to look, desire like by medium-term markets. over stronger and a outlook point believe housing should fueled I Now really continued homeownership. the in strong, but housing demographic going for time, our housing demands cycle, a improve And the

before Charlotte, regulation uncertainty Now turn I over last we there in in the light substantial industry development of since litigation talked. and to is

level most be the once topics its Companies field row, for challenges playing ahead, I Ethical our we leadership. that appreciate second it Anywhere in to on world that, year. opportunities interesting XXth named turn proactive We a Real and of consecutive to the me named With strategy. Companies and World's the also the continues the was Fortune's let litigation excited Anywhere bringing we list these to how and recognize same there both Charlotte. again And one a for for over America's think was the Estate in for there are demonstrated most recently are year to Innovative relative competition will and thinking leadership and

Charlotte Simonelli

goals. everyone. We and can solid what performance our the Good strategic to focus against first and quarter our and had executing cost morning, financial on in control, continue operational we savings

as and We our was relocation. QX drive focus results. industry in will transaction will and first billion, emerge was flat to prior us $X.X octane versus growth performance housing financial revenue now market when continue the softness to believe volume enable our leadership quarter highlight execution, stronger by year differentiated financial offset with even essentially cost I improves.

year the the of by while transaction even prior encouraged accruals. the expenses versus volume improving to enterprise are negative lower base. due million, QX operating across We and EBITDA growth, still litigation off a trends absence volume was low $XX improved

million. end quarter to the prudently cash. $XXX flow on is of and in manage cash we continue see $XXX first slowest. We what with was million, free negative normally at QX are our QX hand seasonally result Cash in was This the line

have anticipated onetime and as $XXX another class million positive be million as our year of we onetime tough savings free expect our flow, help litigation million payments the action legacy our capital, We counterbalance programs And operating and robust over $XX.X modestly XXXX cash $XX management this excluding payment between favorable California matter. will items, year housing. in reminder, cash tax a working to discipline

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

Our $XX leads volumes We decreased year-over-year EBITDA generated and time. to approximately million and in EBITDA. lower franchise core our business our anywhere relocation includes QX, primarily its over franchise Operating core were relocation, business. Brands in in And the business, which $X XX%. client due margin operating stability million margins love

more Anywhere X marketing million, prior $XX volume splits costs. X-quarter splits. Commission points basis year operating improved XX.XX%, higher QX QX EBITDA and versus Our Advisors due $XX continuing year-over-year, trend million negative of and operating was were the stable down in lower to

and, EBITDA some amortization split offset brands. benefit, of to California. by for million EBITDA transactions recruiting markets Operating million a however, a in QX. due by of unfavorable $X and part geography driven operating and like negative in from initiatives. improved lesser few benefiting payments year-over-year we reduced prior saw as saw we top Integrated the of one was are greater to degree, environment, lower our operating improvement Services retention $XX is agent share Anywhere mix improved agents higher reclasses in competitive We as in savings cost take This expenses a

savings realize delivered $XXX Moving year. savings cost million first least on cost expect and quarter in of to the cost. this in We $XX approximately million to at

savings our also our XX expect on we the which presentation in cost illustrated XXXX recognized the are year. be remainder of savings cost program, include, items to Slide across important on Some evenly earnings fairly the

the target, is which of XXX% We savings from XXXX the of program million have of $XX identified actions. carryover

efficiencies on of we greater relentless to continue drive across operate our how We all company. a areas changing to have focus

streamlining We processes, and continue roles tasks. by resources optimizing reimagining or certain to realize AI automate cost using savings footprint, to

of actions enhance our this agent often translate the cost be actions housing experience see It also And historically All question and these future full in We while on long in these in to actually drive especially housing the improving our efforts, business financial help will will term. structure the the will the cost the to work side low future. in of to better our cost hard help customer of markets. transformation get P&L our growth believe and could octane how market. over we the

Slide incredibly presentation, our we've XX reductions, the of changes that, forma unit combining share pro Slide our look to for not we higher existing are at the a to delivery generation which Given cost million $XXX $XXX X.X by pro rate in flow consumer wanted same that our X savings unit forma we higher housing XX% housing earnings a million octane target cost we permanent in can if in that, look well a Alongside assuming commission existing million a implies following: shows more to that forma. would a market our any and X us other getting capitalize market. past in-year our our of home and returns. in market. approximately focus clear, approximately cash our illustrated historic new housing EBITDA our normal the XX free more when $XXX it on higher you market. were of to of temporary double-digit be also sale delivery reductions XXXX to X us if million like financial market investments control, combination had sale any taken million together XXXX unit what About actions in we environment. back put a current pro see offset better Similarly, million the down range, including our believe to future as on The range excluding how this million and variable cost I'm the on move X.X mix we P&L. of should through strategic royalties into what flowed to $XXX of years, of relentless financial factors. over market. commissions inflation, home illustration in a total mortgage which This XXXX shows of strong well in could delivery EBITDA presentation cost actions, $XXX housing savings an cost has can to of normal path and million onetime including $XXX million, to the million This margins. includes proud we've $XXX and This in we enabling factors And expenses, to translate as higher we earnings the million payments.

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

Ryan Schneider

of what market Thank and industry newer you, executing about uncertainty. proud continues to how on and utilizing for the anywhere we deliver the questions. I'm shareholders will control, ongoing through the your value we franchisees deliver Charlotte. our advantages delivering that, lead our in to estate competitive team housing our agents, real agenda incredibly With challenging strategic XXXX is the and can on and take future.

Operator

from from of question [Operator your first And line Instructions] Matthew comes Bouley the Barclays.

Matthew Bouley

you news should the always has guess your business, their helping they been to part assuming commission kind quarter. pay. business. homebuyers on of what and incrementally communicate value or questioning the are of starting doing I brokerage the consumers sellers differently over What all are negotiating now agents Obviously, rate

Ryan Schneider

Thanks the say things, me a question. let Matt. Well, for of couple

that is an have franchisees. group the is, started of probably of describing. luxury, both and a does our of there's will and say place my more call you're that where of as I more historically agents I kind thing complexity, negotiation First remember, one been just we And awesome with, skew just business

that of hearing totally share to also population. pool untroubled just I'm great a to broader agents they're of communicate lot doing, so agent from but it's for what with our they're learning by us continuing a And

than we've part I to our thing settle future say this brands, We and the been would could thought of had ecosystem because is, scale decision leveraging litigation other September. The in our the we have is working longer plans back hard ago, else, things we are anybody across actually again, agreements be how very across more many way our on we of sharing were thinking buyer right? we X months made this

Like average And better so are better utilizing we're competition I lock And us And agreements optimistic in think that about in business than communicate the probably buyer be I our our value. fingers think the finally, actually in agency than this. they're going our have confidence to or really help agents to our beforehand. have ability then to great. slip agents' ability some their through I

sharing of examples and the do of excited rollout basis and doing best the of advantage we also especially have, but here. luxury we're the the practices, kind kind a already of on what can leverage things focus So these what relative of why we history both our of of terms in kind actions and time we're of a this in are

Matthew Bouley

Excellent.

the the that assuming splits about a agents might pay in this? Second one, lower kind considering right? how of change of for industry a are in the may of do to the the question around how to or mix, of higher-producing you leave of similar so, the to perhaps kind if mix topic, around producing the profitability a you Is commission of there agents anywhere scenario course, agents think agents, like kind see versus And agent thinking in industry? out, lower-producing starting be potential

Ryan Schneider

Yes.

from a as seeing we're industry. company. don't anything as So a litigation We're or just it's And think standpoint. seeing to tied regulation an look, Matt, I already recent that that a

in the markets. leave here industry been like the lowest people market in unit in we've see And XX years. You tough

pretty tough it's out So there.

the have If of are. after and their to will of agents think way have don't with to there lead aren't all listings right? value, are, expect NAR you be I don't agents told my franchisees. good calls or buyers. our who had I settlement agents agents more articulate the in Because you our if the industry, And I happened, all

And leaving terms over lose of it most our productive agents deals be And the nonproductive the is talked of lot so are you because most in trend will affecting agents think to of those are not I we people don't the new. happen. best But going the part economics, low that I doing of about. think or of sleep a yet, industry the in who very

even so or sure this they And headwinds this the stuff in on X% ago. quarter, in there's doing had split of was one something than Charlotte I'm some more called our what, QX margin. agents out top mean, commission deals our a year I

big percent going hits agents XX-plus still when where And deals, of But and so potentially on it agents nonproductive kind the that there, a supporting down. a have already costs margin also a XX% your excited bit, of not of to ecosystem. the but the are put we X starting it's we in macro place are trend mover. by from your into is people you're It's top doing not

And economics so number expect the out, totally agents go play of we'll but to thing down. of see how this the integrated I

Matthew Bouley

Thanks, Understood. luck Great Ryan. color. Good guys.

Operator

next comes from the Anthony line of from JPMorgan. Your question Paolone

Anthony Paolone

it first discussions how just and of to perhaps your buy-side question tell country like in the of commission is, terms guidance a this handle So already that this matter future? see what you're part to guess, looks providing agents these in might might whether as system-wide how you maybe that hear about you think us business to can tangible just trying something there's I look the as unfolds? Just doing you

Ryan Schneider

Yes.

there's then I few Tony, future commonplace. place full kind XX it way. of buyer where is a say that the use today about they're a So agreements in yet like would states But there's others doing no and

of agreements them not for new idea at thing. us a necessarily the is using buyer So all

of own to from the be and settlement the agreements there. settlement needs the for exist. the things the some even put do And of buyer and industry exist need wanted to to in that states build don't and our some to need updated NAR even in we build we buyer do agreements However, that

doing a of the in middle And for pool then we're so us, And of big experimentation. that. it's

themselves, a have training here franchisees practice best We of different or is it thousand on for of rolled the on I knew that. think sharing the there's on a I in of value things bioagreements. your we've And We've thing. be but agreements this settlement already articulating market agreements things the longer like we U.S., lot on not said, huge couple important many of and a timing, advantage they're bit launched and of thing a and than pricing been our have where we have the little them would just working in an an like because anyone future. buyer And the else because a out and the

of in to the settlements least because kind lot doesn't. will on there of it other the in agents worked good Now in life, they're that's operating having is share scale of no they're But future. and is long markets, end do there have longer to conversations terms yet. But country. cross-pollinate we of thing We kind and agreements. offers things the and works especially the familiar lot sharing time, from terms to having data mandatory state you operated our these work change successful from. of and kind places example and on especially in differently a right? of system. a a are been stories well you're where your like best and advantage has haven't State with how kind from markets our being to Again, Tony, And so them, we compensation and place at think, bringing stories, with of there's Washington get the in little I with ecosystem, the is of how where where going an that are all for again, where what shock them slight there some not powerful a than they're be have XXX,XXX more And then some of agents a having what the the to a of examples really for there these are world that places stuff But

Anthony Paolone

Got a buyer? what out be offers commission you year borne amount the bit it. look remain guess, from will so, it be that other of different. do Or be the if navigated a And would there or? will that be will structure think the will just be do to do of if you such there will you you like website some think think by that And portal the I compensation, or offer perhaps mechanism that some just your now

Ryan Schneider

Yes.

of clearly mean, settlement look, that. So NAR broker on has is the I offers displaying explicit websites compensation an part of

obviously, in question a that's more is for question of think I their complicated. but that's So your settlement, very Look, them.

reminding buy them negotiating is real and I answer my the and think could for I is possible employees buyers? or actually my with my agents home right offers new thing right? furnace absolutely be agents or just Sure, sales think they replaced that paid pay of and working I don't compensation is anyone franchisees sorry, to we thing. that's future, thing, not the by knows. you to And But can what a to we this keep want in talking more about the not us credit hey, sellers, include, a but you house, needs offers can want like to be that's kind can of

written, that And lot rules rules. think whether because been rules of kind a yet to not they're then Tony, experimentation. we're there's there's little of of And going so, settlement MLS I or lot handicapped all a still right, have be a

other others anybody for how be, we'll might those scenarios, on do, communicate opportunities operate. affects as challenges, because or how our be to go face market, with we and So in thoughtful the thinking things may here to them out macro it's see, or but to I share cost And tough our And going assets practices. about best base to everybody going as I there would that's some think to some planning there's how to that there's well, we're like moves be is about same we relative again, there that change. like it thinking agents change the strategic it's whether through going the whether

Operator

the question from next of Your from BTIG. comes Soham line Bhonsle

Soham Bhonsle

to sort agents bigger for how I here. on And term. fair think one U.S. in first I Ryan, here, long today. the need and effectively And we're environment brokers you compete pressure see long you. of your Mostly do boutiques some in at to some term? if Curious think new that be XXX-oddhousand to consolidation commission in there's the guess, thoughts fact going the the in brokers on rate of space

Ryan Schneider

get going think litigation only on see inevitable. I pressure year. a said there even commission last some the I've what's business. way is developments happened it can obviously, even of ever or consolidation the much over economics is normal scale revenue was look And year because consolidation inevitable the think publicly, that, got I and and our accelerate scale, business side. mean I how what more deal regulatory with is I that this you mean is it you efficient especially the services as of a is And last more before there's if Charlotte octane of have showed, I one to scale. got right, this at is you cost to thought you've to high-value housing there. to pressure, if get on just the at deliver we one way side focus market, and how on just your even

think So it's I inevitable.

on quite it's know And friends probably reason in that, not a matters reminded believe the I And and there's in another can I on world our inevitable portal views that that up lot do. think that. but matter recently. one of is brand of I technology good providing industry. kind our everyone think brands And I stage stood different

also. think And will in future I helpful so that the be

Now can at I advantages the of very it's because going that side, with here and is right strange and tell ours, I thing think on payments our hoping bigger companies. over a overhang I I in and great macro, have for still there's that. also a consolidation right think at today. I inevitable just with the from are will am consolidation moment revenue do scale a a brands were X litigation litigation the on there looking of think to And ongoing I'm but incredibly lot especially you, cautious differentiate lot tough this that's time players the company like a But we're both uncertainty

Soham Bhonsle

free guess, then And just about And that $XXX to the then I on cash. in sheet, Great. back the cash just Okay. tying balance flow. Charlotte, right, there's million

cash You're this $XXX the but on payments guiding free onetime sort operating year. of then flow million you this to business, positive have in modestly core

baking into positive maybe expense? sort operating you free flow And about just what intend can that to you fund then your you're So talk guidance? cash also of how

Charlotte Simonelli

Yes.

generating last the happen So start don't when the of right in almost. possibility the right we and pay depending of now timing we'll have a is that if now, things on bit in these flow the about cash positive to approved free QX, there's May, settlement settlement until

So tax we'll revolver. California also in second the likely quarter. fund The likely to is matter that from hit the

good the The revolver. ton then the our be flow likely on free moving same cash a the by that And the for shipping and funded of sort we'll so generation, reason, back away positive we start we into at news start have is revolver. capacity revolver. of And will

As items. the guidance, positive, onetime so excluding modestly that's the we far when say as

And baked that performance normal our so what's the of business. is into

those business, how year, payments. the on would it So the perform excluding onetime

be there's that it if will So is payments negative to but a helps. that payments, take the guidance, probability us onetime the onetime positive, with excluding the

Soham Bhonsle

positive what cash need have market kind that volumes And to operating do hit flow? you like contemplated you of of free sort

Charlotte Simonelli

to it's part, free sort right? that a of call octane cash of we'd is you, us to flow quite slide said $XXX financial in million cash believe, we there's shared big market, amount normal going what in Well, to to, a million units. X.X I normal And So free million that's Yes. we've take housing the million what with X $XXX flow. a of

Now also excludes onetime any items. that

of we're it's either like absent housing positive million. likely sort to million the So that modestly onetime right this normal $XXX horrible a But in in $XXX housing item, in market market, now.

So hopefully, help. that will

Soham Bhonsle

guess can more if I I then sneak And in. just one

this you that just could as what will that for sort put you million year, talk well. On scenario? cost in of Can about exceed the you that $XXX savings number suggested like you

Charlotte Simonelli

improve how cost even right? to the, also satisfaction, permanent just always because think profitability. That's help so Yes. that we something way. is this we it doing enhance satisfaction, but about are looking journey, we'll obviously, agent a consumer to be our operate, Well, for

year start our million million that fact going we that next benefit $XXX are the this we're just So year that will that million upon $XX of now this hadn't anticipated than we going to things to $XXX-plus take had savings, to what's with carryover us year. into act the higher

costs journey stop It's don't this just on pretty our XXX% for have endless we target a probably working of us. we year. is because that achieved So

we're were right actions not on what's what now. new that feverishly working higher us to So is anticipated and that's take going

Operator

Your line from next question KBW. the McJoynt Tommy of from comes

Thomas Mcjoynt-Griffith

back on is questions, less the offers can that listings practice off to to then websites. by-product, guess future compensation of of of out to websites if perhaps the you And made it a that But no brokerage those? the I of Anthony's anywhere longer going on so, MLSs? to and as one displaying plan changes NAR the post of what it was carve settlement the Actually, alluded Is compensation see do just MLS. business on as as does as one brokerage appear offers of in be for such those

Ryan Schneider

written. yet Tony see. of referenced, And XXX too So the it's was MLSs. to we'll I as we're questions, in work to of kind reason the part do, see, the early of speculate like on different actual will of we'll answer think, to the on I to be rules I those is answer on Tommy, is they are what either remember, how answer are think the going ecosystems these unfortunately, part And

effectively. are people So going here there's you've the no that got actual United writing rules the guarantee technical the XXX rules States. across same Like look to

a industry, right? industry. MLSs. from the There parties in large this But be innovation means I going data bit think more who there's the mean I we're are brokerages, future There of there ecosystem wait there and are do of MLSs. a standpoint. the and to this third going of a for So in work both number we're on are it to do what what little portals see, in with are

how think make of play the to a XX have all of more of players will X the those on lot each how I choices. we'll clarity will companies kind so months, And how kind in ecosystem will evolve, even in different different both ecosystem and

So really early. is it too

And is over some sorted of summer. stuff the supposed to out be that

want But can the we time theory to at we'll clearly you feel what clarity some So hypotheses we think about but that not next just some are we you. game with to doing thing talk have to we agency set up to most ahead which they're is And make to think the with their for we and agreements, and important agents we charging going sure our actually again, customers think we're issue I least some hopefully, the do more watching helpful are do. buyer us. are we're and have think of be closely, great, kind success

Thomas Mcjoynt-Griffith

I commission in to million in XX.X% increase like the from on X.X% implies XX% That in midpoint you're makes did the to using call illustration to forma the gears. looks And to of What's XXXX. it, it million transaction on a guess sort In X.X then analysis switching of would home just that impact pro going XX, volumes to helpful the get it relative EBITDA, this that splits it at $XXX you existing your $XXX of sales. sense. Slide be

Charlotte Simonelli

normal basis increases, XXX it's increase. Yes. with more like a There's of It's XX a not It's modest increase but points increase. not or volume modest anything of an material. implied as

Thomas Mcjoynt-Griffith

basis So of hearing increased commission less increase transaction volumes XX%, kind XX than I'm that Is what would splits correctly. points.

Charlotte Simonelli

not it's number increase. the but in used disclosing a Like our modest exact forma, I'm pro yes,

Ryan Schneider

have world, at before. of kind but in you're will brands quarter, You seen, units, $X.X if be increase the different or that the trends numbers of had to numbers than $X.X commission whether start we've million, again. you million right? those record starting, remember get that could kind you our this this one go of it's started seen low down you'd today's stabilization of with in We've if we've splits past even referenced area kind this where same And the different depending in on some

on a more just some in of would normal good So the market just octane, that a there's more normal less market give our the you're forma grasp give of as housing a a gives extrapolation housing a us you thinking. this But on would hopefully, octane as maybe work pro cost us. financial well of sense little think kind Charlotte's than And it got this. I

Charlotte Simonelli

modest environment, the split. in thing volume competitive mind, splits different. assuming the to to that increase in a the similar drove changes over that going competitive here commission our the keep be would time. If commission only bigger And is much more right, environment, create like Like that is what in increases we're is something

Operator

of Your from Ryan next line question comes from & the Associates. Zelman McKeveny

Ryan McKeveny

small commission guess, a of one and that a move just you bps quarter's discussed what been look and that bit franchise brokerage. looks to? rates that. at just a I call final downtick attribute to it know movement, have results, little factors I lot know but if we I can like X would in there. here the lower, one X it, But a lot, on

Ryan Schneider

an for actually really year, by basis were driven Yes. X in points, increase we homes. for business, homes. increased again, flat. full owned the our we by example, price down our ABCR points of that X year. In And higher-priced Frankly, brokerage mix were brands last frankly, was business, then driven basis in the And remember,

dependent and about So having ABCR because seeing of more there's the of mix good around, numbers homes thing, Ryan, the real the on the pretty quite kind with these selling what we're expensive of range lower days moving ABCR. just price a keep is albeit we home that number the small homes is

Charlotte Simonelli

due And amortization. the in to the first also see sometimes that quarter, tend result we to

like the payments things other and ABCR about amortization talking smaller you're prior of a If business driven and brands over by base.

Ryan McKeveny

it. Got

things hear. Okay. called is you the the around like health And more franchisees? in the franchise maybe are good side, obviously, at share strength sense. sales on performance I how market. going? then gains franchise which actual guess Sotheby's, the some and very housing franchise guess broadly network, general or tough thoughts across of about I financial new That could the renewals anything out And you to the share makes

Charlotte Simonelli

Yes.

last, as X we much far take we're market to softer I where don't that franchisees, of we they're that There's a on pretty of the we've stay the that similar helping best that We're quarters. things. of when top in know, franchisees. they over the to of We're a spot. the sort their decisions been make health making our to business sure place much run process gets it As We're a so healthy were the with sort in to analyzing on talking them weekly basis. a X

a have bit are housing market, debt from worse while we super actually. it's bad than been would in a we healthy stable perspective So a little pretty

best make sort some sure so a always another there's we're our holding come throughout quarter franchisee right through the now, in one So effort things franchisees things help foot be on and that versus lot our own forward out. that's of we're whole, that to one, putting could and because to our go this But of we time. some

Ryan Schneider

about, and that have do Yes. help their like to be that to deliver, it? kind effect be year through think to we've here, ago is the of a record one tough got talked for but if way which gone year and our going sales when drive uncertain fall, I excited, year I the quality a who their the insights year to got really starting up, having down an people to thing. hopefully are had you're comes navigate that's interest. it solid franchise was sales, things we to us, foresight good costs down, of our and really multiple it a talked you we're technology. about going have of is in up, it has future, I and with flat, settled I before. flight the a shown I increase a this franchise saw talked and bad the And litigation and leader then. that bad. We profits XX we in debt Well, industry And how their XXXX, asked think On flat is market a do some kind to an in as big we questions provide mean about inbounds

kind And like it, the mounts we're fair both the uncertain flight quality of to, so of value the right but call we we feeling this future. from that in also now have prop sales franchise kind

Ryan McKeveny

from lock-in And Ryan, That's the I a that more squeeze effect inventory uplift talked a saw to in shows side. maybe on the low about in data if quarter, similar one industry-wide suggest it you guess a helpful. could that obviously, in growth base. you the the listing first bit. on And homeowners seems and lessened I has

whether rate that's I'm in homeowners your indications higher back moving to if still sidelines moving happening that's the events, Or for sticking kind guess know, more with don't plans? interest things, sellers sense reasons curious So other of I movement sell given or rates again rate any offsetting of kind of are who life dynamic? their listing does like to with are much those want the it recently, April, then the prospective move? lock seem I And

Ryan Schneider

in X% A lot lock-in increase low the to relative but base mean a is listings sales. decline, than in history. that Look, effect a I an X% loosened. my incredibly or like of quick better think off it's means home like don't answer a horrific still off increase a things X% question. has of Yes, it's in base, such that's low kind I

think has So thing changed. the I lock-in don't

do want sell levels. who but it's some people are at to pretty think selling, historical I

was us, we is more the share that's a for better like, thing wow, more and fact the excited we're there that I about because side those good. lot success there, up the comfort on of our is that lock-in luxury fact driven But in a have economics listings continuing Reality listings increase XX% since in the more the much luxury the us, like For volume and vis-a-vis were more share across think effect, International taken the industry some and still just in outperforming. Sotheby's take lot portfolio small I the listings increase don't of relatively the especially too from price trend That's numbers.

Ryan McKeveny

sense. makes Yes, Got it.

Operator

Inc. question John Campbell Your next comes line Stephens from the of from

John Campbell

recently for is touch like potential Doma, on wanted over acquisition Doma. attach feel What I time? see on can you rates you with This Campbell. announced TRG's of do Bas kind Jonathan do improve and of it John quickly to guys there

Ryan Schneider

up. so we couple where of player So a underwriter. of sold right? Dome they've TRGC brought And brought we it. really of did Berkshire since are with took a kind cash. valuation million the that Opendoor. And in with this just Hathaway, part brought our gone of $XXX Centerbridge has deal done for of that it they've with we in ago, That thing what Lennar's They minority the now used that. in of then, XX% They we in like, Acquisition clarity, now the piece we years now we to like and be own A business,

think than that thing. And so the a still at it there's this the we own worth end call, our was of we chance be this stake when in more will

excited player in origination So top you and rooting we minority speak here, chance the them. if really for is X expand we as a I into market, of they can't a the are this be and this half joint to they distribution look from their for can very we're really to where a Look, stuff. all in much. sit And this for latter a channels an share closing Florida investment mortgage player is make player Texas. homebuilders places TRG venture said, year, too to presence we're got and about that, in. in minority But kinds them to I transaction, Lennar market like of their increase do and equity the like they I expect that think going And both close then

obviously So this be per answer and we're but very not hope your I to that se, really question. seat driver one, excited on them for successful, the in we're helps

John Campbell

could how Yes. and give change the years? here, us maybe latest that's And gears changed business of trends you then couple Cartus last over maybe but for the

Charlotte Simonelli

Yes.

And some last from cyclical are year prior So pent-up of softness. held relocations. in as very year, to impacting the some was tied what doing. sort our of on demand clients, definitely which softer QX macro the of It's is business, back sort kind still our them last it's QX too, but a than clients QX is of having I of mentioned script, and pull

our we very think initiation good was I our share much perspective. is feel performing and But it So client from softer to a relative about still business others. how definitely

come back business back. quickly I pretty macro think when comes the that tends to

So we'll see when happens. that

be this it's I like think for think going a to year, TBD. we

budgets I that can it's our year, but on year think demand we're definitely last planning softness. business QX pent-up than dime flip last modest QX still quickly. clients much prior very softer for sort of some a But from really flop QX change was it have, this year, all and can on dependent that but because a the had

what and tied softer, pulling facing. macro same of for we So strong back our clients but reason, the very QX XXXX demand, they're 'XX, pent-up been due into had a lingered the which it's much just to mostly to

Operator

further would our no like are presentation, today's thank joining and I to now This for there conference. As today's questions, thank you all us. for concludes speakers

You may now disconnect.

Anywhere Real Estate (HOUS) 25 Apr 242024 Q1 Earnings call transcript