• Operating EBITDA: $290 million for 2024, up $35 million from the prior year.
• Free Cash Flow: $50 million, or $70 million excluding a $20 million litigation settlement payment.
• Q4 Operating EBITDA: $52 million, up $24 million year over year.
• Cost Savings: Achieved nearly $125 million, exceeding the target by 25%.
• Luxury Volume Growth: Up nearly 10% for the year and approximately 20% in Q4.
• Franchise Network Growth: Added 67 new franchisees in 2024, with 28 in Q4.
• Q4 Revenue: $1.4 billion, up 9% versus prior year.
• Full Year Revenue: $5.7 billion, up 1% versus prior year.
• Operating, Marketing, and GNA Expenses: Totaled $1.71 billion, down $72 million versus prior year.
• Agent Commission Splits: 80.3% in 2024, up 14 basis points versus prior year.
• Anywhere Brands Operating EBITDA: $521 million, down $6 million due to foreign currency impacts.
• Anywhere Advisors Operating EBITDA: $93 million, up $42 million versus prior year.
• 2025 Operating EBITDA Guidance: Expected to be about $350 million.
• 2025 Cost Savings Target: $100 million.

• Warning! GuruFocus has detected 4 Warning Signs with HOUS.

Release Date: February 13, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Anywhere Real Estate Inc (NYSE:HOUS) delivered industry-leading EBITA in 2024, with a $35 million increase from the prior year, reaching $290 million.
• The company achieved nearly $125 million in cost savings, exceeding their target by 25%, through simplifying, automating, and streamlining operations.
• Anywhere Real Estate Inc (NYSE:HOUS) accelerated its AI agenda, deploying generative AI at scale to improve customer experiences and operational efficiency, resulting in a 40% improvement in lead conversion rates.
• The luxury segment saw significant growth, with luxury volume up nearly 10% for the year and approximately 20% in the fourth quarter, gaining meaningful market share.
• The company expanded its franchise network by adding 67 new franchisees in 2024, including a notable addition of a 400-agent brokerage to the Corcoran brand.

Negative Points

• Anywhere Real Estate Inc (NYSE:HOUS) faces significant one-time cash flow headwinds in 2025, totaling approximately $115 million, due to litigation settlements and legacy tax matters.
• The housing market remains challenged with a lack of supply and pressure on transaction volumes, impacting the company's growth potential.
• The company is dealing with the financial impact of the California wildfires, which have affected about 1,000 agents and several offices, with uncertain effects on future quarters.
• There is ongoing uncertainty and potential volatility in the housing market, which is a significant swing factor for the company's 2025 EBITA outlook.
• The company is navigating complex industry practice changes and regulatory challenges, such as the NAR's clear cooperation policy, which could impact operations and market dynamics.

Q & A Highlights

Q: Can you elaborate on the assumptions behind the 2025 operating EBITA outlook of $350 million? A: Charlotte Simonelli, CFO, explained that the biggest swing factor is the housing market, which has wide-ranging forecasts. The company feels confident about their cost savings and commission splits, which have been consistent over the past quarters. They will update quarterly if assumptions change, but currently, they feel good about their position.

Q: What is Anywhere Real Estate's stance on the clear cooperation policy, and what changes are you advocating for? A: Ryan Schneider, CEO, stated that they advocate for relaxing the policy rather than a full repeal. They believe transparency and access to all inventory benefit both sellers and buyers. They are prepared for a shift to private listings but believe it is not in the best interest of consumers.

Q: Can you discuss the pipeline for new franchisees and whether they are established brokerages or new players? A: Ryan Schneider noted a strong pipeline, with many established brokerages joining due to the value proposition Anywhere offers, including litigation support and industry practice navigation. The company added 67 new franchisees in 2024, including a significant 400-agent brokerage in DC.

Q: How does Anywhere Real Estate plan to leverage its position if the market shifts towards private listing networks? A: Ryan Schneider emphasized that they are ready with technology and resources to support private listings if needed. However, they believe this shift is not beneficial for consumers, as it limits access to inventory and could affect pricing transparency.

Q: How does the adjustment for non-cash compensation and legal matters impact the 2025 guidance of $350 million? A: Charlotte Simonelli stated that the adjustments have a relatively small impact, with $12 million in 2023 and $17 million in 2024. The company expects $60 million EBITA growth in 2025, apples to apples, without significant headwinds or tailwinds from these adjustments.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.