Anywhere loses $453M Q4, and sets its sights on cost efficiency by 2023
Anywhere, a real estate conglomerate, is not unfamiliar with dealing with volatile housing market conditions. Although the company survived the 2008 Great Recession, executives hope that it will be able weather the shift in housing market conditions between 2022 and 2023.
“I am growing optimist about our situation and the opportunities before us,” Ryan Schneider, Anywhere CEO, said to investors during Thursday’s fourth quarter earnings call. “We are focused on improving the way we operate our company to deliver greater efficiency, and increase our value proposition.”
Schneider’s optimism is not without merit. His firm still has a lot to cover. Anywhere reported revenue of $1.323 Billion in the fourth quarter 2022, a 33% decrease from the previous year. This resulted in a net loss $453 million, compared to a net profit of $47 million a previous year. The firm reported revenue of $6.9 Billion for the full year, down 13% compared to 2021 — a net loss $287 million compared with a net income $343 million a previous year.
Executives attributed the decline in revenue and net loss to the lower volume of home sales and the sale the firm’s title underwriter. Anywhere Brands’ franchise group, Anywhere Brands saw 22% drop in closed sides in 2022 to 911,077. Anywhere Advisors’ owned brokerage group, Anywhere Advisors, saw a 14% annual decline in closed transactions sided to 317,000.
Anywhere Brands saw a 34% decrease in transaction sides during the fourth quarter, while Anywhere Advisors saw a 29% decrease.
Although the firm’s financial results in 2022 were not the best, executives were happy with an increase of 4% in agent count and record agent retention. They also noted that the firm’s commission splits were up by 203 basis points year-over-year and they expect them will increase in the future.
Charlotte Simonelli, CFO of the firm, stated that split pressure will continue to be driven mainly by continued agent mix. Higher-producing agents who earn the highest splits, will continue to drive more volume.
Executives stated that the company’s main focus in 2023 will be cost reductions. Anywhere achieved $150 million cost savings in 2022. Simonelli stated that the firm expects to achieve an additional $200 million cost savings.
Simonelli stated that the operational real estate footprint is the largest portion of our current cost structure. Simonelli stated that this includes both the physical brick and mortar of our brokerage and title operation, as well as other support components such staff, tools, resources, and other activities not related to agents. We are changing the way we deliver services to customers and agents in our physical space locations.
Simonelli also pointed out that Anywhere had reduced its head count by 11% since June 2022. She said that the firm is focusing on technology to improve efficiency for both consumers and agents in the future.
Schneider stated that “Anywhere responded with agility to the difficult 2022 housing market.” “We reimagined our operations and strengthened our financial profile, while continuing to make strategic progress in 2023 and invest for growth.”