Robert Reffkin guided his company to the remarkable achievement by becoming the nation’s largest brokerage based on full year 2021 sales over $254 billion. 2022, however, proved to be a tough year with significant profitability challenges and Compass experienced notable losses.
The company reported $4.9 billion in revenue in 2022 through the third quarter ( 2.1 percent above the same period in 2021) but lost $443 million (representing a 38.9 percent increase in losses from the same period a year ago) resulting in the stock nosediving from $20 at time of IPO, to under $3 (in late 2022).
To attempt to right the ship, Reffkin stepped up and announced large cost-cutting measures, including massive tech layoffs, eliminating cash or equity incentives to recruit or retain agents, and raising splits in order to generate profit. Compass has many superstar agents previously lured with sweet incentives and who will most likely now be fiercely recruited by competitors. Reffkin will need to show resilience, strength, and a deft balance between cost-cutting and delivering services to his agents. 2023 promises to be a daunting year and a big test for Reffkin and Compass.
Nonetheless, Compass begins the year as the nation’s largest brokerage by sales volume and home to over 13,300 agents (most of whom are top producers). He has the tools, resources and agent army to do it and remains therefor one of the most powerful people in residential real estate.