Moreover, the company incurred $29 million in restructuring charges, of which $25 million was for severance pay originating from past layoffs. The firm posted a net loss of $154 million compared to a net loss of $100 million in the third quarter of 2021 as lower revenues and restructuring costs more than offset reduction in commission and operating expenses.
The company is braced for further bad times ahead, Reffkin said: “The past 12 months have been tough and the next 18 months fear that they can be tougher,” he told investors and financial journalists.
“Compass will be diligent and persistent. We’re focused on getting to the other side. Since the second quarter of this year, we have been aggressively meeting down our expenses to adapt to this rapidly deteriorating market and already achieve significant cost reductions in our technology, engineering and other operating expenses through a variety of measures, including reductions in force.”
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Nevertheless, the CEO pointed to improved efficiencies moving forward that will aid the firm in navigating choppy waters: “With our heavy investment period behind us, we are operating the business more efficiently,” he said. “We have achieved significant market share gains among weakening competitors. We have built an incredibly strong agent network, a highly regarded brand in the most advanced technology platform that helps us recruit agents and make them more productive. We believe that the actions we have taken to date and cost reduction initiatives currently in place put us on pace to deliver our targeted non-GAAP operating expense run rate of between $1.05 billion and $1.15 billion exiting 2022.”