Compass, Inc. Reports Record Third Quarter 2026 Results
Compass, Inc. (COMP) filed an SEC Form 8-K — Results of Operations and Financial Condition. Compass, Inc. Report s Record Third Quarter 2026 Results All-time Q3 Records for Revenue, Net Income, Adjusted EBITDA and Operating Cash Flow Q3 Revenue +12% YoY 1 ; GAAP Net Income $62 Million; Adjusted EBITDA 2 $306 Million Operating Cash Flow $248 Million; Cash Balance Increas
How this was made
The 30-second read
Why it matters
The earnings beat and record cash generation provide a catalyst for short‑term price appreciation, while the debt reduction capacity improves long‑term fundamentals.
Market read
Compass's strong Q3 performance stands out in a weak housing market, offering a potential trade opportunity.
What to watch
High organic growth relies heavily on the recent Anywhere merger integration, which could face execution risks.
Compass Reports Record Third Quarter 2026 Results, with Revenue of $3.90 billion, GAAP Net Income of $62 million, Adjusted EBITDA of $306 million and Operating Cash Flow of $248 million.
Revenue, GAAP net income, Adjusted EBITDA, operating cash flow and free cash flow reached all-time third-quarter records. The company generated positive GAAP earnings and substantial cash flow despite industry transactions declining year-over-year, while reducing its full-year non-GAAP OPEX range.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, Q3 2026GAAP | $3.90B | – | 111% |
| Pro forma revenue, Q3 2026other | $3.9B | – | 11.6% |
| Organic revenue, Q3 2026non-GAAP | $3.75B | – | 7.4% year-over-year on a pro forma basis |
| Revenue, nine months ended September 30, 2026GAAP | $10.91B | – | – |
| Commissions and other related expenses, Q3 2026GAAP | $2.92B | – | – |
| Sales and marketing expense, Q3 2026GAAP | $107M | – | – |
| Operations and support expense, Q3 2026GAAP | $426M | – | – |
| Technology and development expense, Q3 2026GAAP | $107M | – | – |
| General and administrative expense, Q3 2026GAAP | $72M | – | – |
| Anywhere Merger transaction and integration expenses, Q3 2026GAAP | $28M | – | – |
| Restructuring costs, Q3 2026GAAP | $4M | – | – |
| Depreciation and amortization, Q3 2026GAAP | $145M | – | – |
| Total operating expenses, Q3 2026GAAP | $3.81B | – | – |
| Income (loss) from operations, Q3 2026GAAP | $87M | – | – |
| Investment income, Q3 2026GAAP | $7M | – | – |
| Interest expense, Q3 2026GAAP | −$41M | – | – |
| Income tax benefit, Q3 2026GAAP | $4M | – | – |
| Equity in income of unconsolidated entities, Q3 2026GAAP | $6M | – | – |
| Net income, Q3 2026GAAP | $63M | – | – |
| Net income attributable to Compass, Inc., Q3 2026GAAP | $62M | – | – |
| Net income attributable to Compass, Inc. margin, Q3 2026GAAP | 1.6 % | – | – |
| Net income per share attributable to Compass, Inc., basic, Q3 2026GAAP | $0.08 | – | – |
| Net income per share attributable to Compass, Inc., diluted, Q3 2026GAAP | $0.07 | – | – |
| Adjusted EBITDA, Q3 2026non-GAAP | $306M | – | – |
| Adjusted EBITDA margin, Q3 2026non-GAAP | 7.9 % | – | – |
| Net cash provided by operating activities, Q3 2026GAAP | $248M | – | – |
| Capital expenditures, Q3 2026GAAP | −$8M | – | – |
| Free cash flow, Q3 2026non-GAAP | $240M | – | – |
| Adjusted EBITDA, nine months ended September 30, 2026non-GAAP | $730M | – | – |
| Net income attributable to Compass, Inc., nine months ended September 30, 2026GAAP | $176M | – | – |
| Net income per share attributable to Compass, Inc., diluted, nine months ended September 30, 2026GAAP | $0.22 | – | – |
| Net cash provided by operating activities, nine months ended September 30, 2026GAAP | $282M | – | – |
| Free cash flow, nine months ended September 30, 2026non-GAAP | $252M | – | – |
| Total non-GAAP operating expenses excluding commissions and other related expenses, Q3 2026non-GAAP | $676M | – | – |
| Cash and cash equivalents, September 30, 2026GAAP | $841M | – | – |
| Long-term debt, September 30, 2026GAAP | $3.14B | – | – |
| Net Debt to Adjusted EBITDA, Q3 2026non-GAAP | 2.7x | – | – |
| Brokerage Gross Transaction Value, Q3 2026other | $138.9B | – | 96.5% |
| Organic Brokerage Gross Transaction Value, Q3 2026other | $133.1B | – | 7.5% year-over-year on a pro forma basis |
| Brokerage total transactions, Q3 2026other | 140,118 | – | 106.4% |
| Organic Brokerage transactions, Q3 2026other | 135,956 | – | decreased by 0.3% year-over-year on a pro forma basis |
| Total Brokerage agents, Q3 2026other | 85,476 | – | – |
| Agent retention rate, Q3 2026other | 95.1% | – | – |
| Franchise Gross Transaction Value, Q3 2026other | $108.9B | – | 1,181% |
| Organic Franchise Gross Transaction Value, Q3 2026other | $104.2B | – | 2.3% year-over-year on a pro forma basis |
| Franchise total transactions, Q3 2026other | 191,809 | – | 2,073% |
| Organic Franchise transactions, Q3 2026other | 189,054 | – | decreased by 3.6% year-over-year on a pro forma basis |
| Net royalty rate per side, Q3 2026other | $486 | – | decrease of 27.4% |
| Organic net royalty per side, Q3 2026other | $470 | – | 3.8% year-over-year on a pro forma basis |
| Title and Escrow transactions, Q3 2026other | 38,757 | – | 406% |
| Average Title and Escrow revenue per transaction, Q3 2026other | $3,590 | – | 1.4% year-over-year on a pro forma basis |
| Funded loan volume across mortgage joint ventures, Q3 2026other | $3.3B | – | 9.9% year-over-year on a pro forma basis |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| BrokerageBrokerage GTV was $138.9 billion and Brokerage agents closed 140,118 total transactions in Q3 2026. | $3.58B | – | – |
| FranchiseFranchise GTV was $108.9 billion and the Franchise network closed 191,809 total transactions in Q3 2026. | $122M | – | – |
| Integrated ServicesTitle and Escrow transactions were 38,757, with average revenue per transaction of $3,590. | $197M | – | – |
Amounts quoted below without a unit are in millions, as in the filing’s tables. Per-share figures are as printed.
Q4 2026 and Full Year 2026 outlook
- Revenue$3.150 billion to $3.350 billion for Q4
- Operating expensesNon-GAAP OPEX of $2.71 billion to $2.73 billion
- NoteAdjusted EBITDA of $100 million to $130 million for Q4
- NoteFree cash flow positive for the full year 2026
- NoteNon-GAAP OPEX range reflects a decrease from the prior range of $2.75 billion to $2.80 billion
What drove it
- Actual Q3 revenue increased by 111% year-over-year, while pro forma revenue increased by 11.6% year-over-year and organic revenue grew 7.4% year-over-year on a pro forma basis.
- Organic Brokerage GTV grew 7.5% year-over-year on a pro forma basis, compared with a 0.7% increase for the entire U.S. residential real estate market.
- Organic Brokerage transactions decreased by 0.3% year-over-year on a pro forma basis, outperforming the 1.8% decline in U.S. residential real estate market transactions.
- Adjusted EBITDA surpassed the high end of guidance, which management attributed to solid non-GAAP OPEX discipline and ongoing cost synergy realization.
- Mortgage joint-venture funded loan volume increased 9.9% year-over-year on a pro forma basis, driven by loan officer recruiting and higher attach rates.
- Website traffic to Compass.com and mobile apps was up 53.6% year-over-year in Q3 and rose to 68.5% year-over-year in September.
- The company onboarded 33,950 real estate professionals from Coldwell Banker Realty, Corcoran, and Sotheby's International Realty as of October 31, 2026.
Concerns
- Management said the housing market had softened over the past few weeks.
- Organic Franchise transactions decreased by 3.6% year-over-year on a pro forma basis.
- Organic Brokerage transactions decreased by 0.3% year-over-year on a pro forma basis.
- Net royalty rate per side decreased by 27.4% year-over-year to $486, driven primarily by newly acquired brands with a lower average sales price compared to the Christie's International Real Estate network.
- Long-term debt was $3.14 billion at September 30, 2026, and Q3 interest expense was $(41) million.
- Anywhere Merger transaction and integration expenses were $28 million in Q3 2026 and $245 million for the nine months ended September 30, 2026.
What to watch
- Q4 2026 revenue guidance of $3.150 billion to $3.350 billion and Adjusted EBITDA guidance of $100 million to $130 million.
- Delivery of full-year 2026 non-GAAP OPEX of $2.71 billion to $2.73 billion and positive free cash flow.
- Ongoing realization of Anywhere cost synergies and integration progress.
- The planned rollout of the Home platform to all real estate professionals in the franchise network starting in Q1 2027.
- Organic transaction trends relative to the broader U.S. residential real estate market.
- Potential redemption of the $500 million 9.75% Notes when first callable in Q2 of 2027.
Balance sheet and cash flow
- Cash and cash equivalents were $841 million at September 30, 2026, compared to $199 million at December 31, 2025.
- Total long-term debt was $3.14 billion at the end of Q3 2026.
- The company had no balance on its revolver at the end of Q3 2026.
- Net Debt to Adjusted EBITDA was 2.7x at the end of Q3 2026, compared with 4.4x when the Anywhere transaction was first announced.
- Net cash provided by operating activities was $248 million in Q3 2026 and $282 million for the nine months ended September 30, 2026.
- Free cash flow was $240 million in Q3 2026 and $252 million for the nine months ended September 30, 2026.
- Proceeds from issuance of convertible notes, net of issuance costs, were $977 million for the nine months ended September 30, 2026.
- Payments for business combinations, net of cash acquired, were $(443) million for the nine months ended September 30, 2026.
- The company stated it remains in a good position to redeem its $500 million 9.75% Notes when they are first callable in Q2 of 2027.
Analysis
Compass reported a record third quarter, with Q3 2026 revenue of $3,897 million, GAAP net income attributable to Compass, Inc. of $62 million and Adjusted EBITDA of $306 million. Revenue increased by 111% from $1,846 million in Q3 2025, reflecting the expanded reported business following the Anywhere acquisition. On a pro forma basis, revenue was $3.90 billion versus $3.49 billion, an increase of 11.6%, while organic revenue of $3.75 billion grew 7.4% on a pro forma basis. GAAP operating income was $87 million versus a loss from operations of $(6) million, and Adjusted EBITDA margin was 7.9% versus 5.1%.
The operational data indicate relative share performance in a subdued housing backdrop. Organic Brokerage GTV grew 7.5% year-over-year on a pro forma basis while U.S. residential real estate market GTV increased 0.7%. Organic Brokerage transactions decreased 0.3%, compared with a 1.8% decline in the broader market. Franchise organic GTV grew 2.3%, but organic Franchise transactions decreased 3.6%. Brokerage agent count ended Q3 at 85,476 versus 83,184 at the end of Q2 2026, while retention declined to 95.1% from 95.5%.
Profitability and cash conversion were central to the release. Q3 operating cash flow was $248 million and free cash flow was $240 million, compared with $75 million and $74 million, respectively, in Q3 2025. The company ended the period with $841 million of cash and cash equivalents, no revolver balance and $3.14 billion of long-term debt. Net Debt to Adjusted EBITDA was 2.7x, and management said it remained positioned to redeem the $500 million 9.75% Notes when first callable in Q2 of 2027. Interest expense rose to $(41) million from $(2) million as the capital structure reflects acquisition-related financing.
The segment mix now includes meaningful Franchise and Integrated Services revenue. Brokerage generated $3,578 million of Q3 revenue, Franchise generated $122 million and Integrated Services generated $197 million. Title and Escrow transactions totaled 38,757, and average Title and Escrow revenue per transaction was $3,590, up 1.4% year-over-year on a pro forma basis. Mortgage joint-venture funded loan volume was $3.30 billion, up 9.9% year-over-year on a pro forma basis, which management attributed to loan officer recruiting and higher attach rates.
For Q4, Compass guided to revenue of $3.150 billion to $3.350 billion and Adjusted EBITDA of $100 million to $130 million. For the full year, it reduced the non-GAAP OPEX range to $2.71 billion to $2.73 billion from $2.75 billion to $2.80 billion and expects positive free cash flow. The key execution points are whether cost synergy realization and expense discipline continue as management describes a recent softening in housing conditions, whether organic transaction performance remains ahead of the market, and how quickly the company can extend its Home platform across the franchise network beginning in Q1 2027.
Management, verbatim
In a housing market where transactions were down year-over-year, Compass delivered record financial and operational results in Q3.
Robert Reffkin, Founder and Chief Executive Officer of Compass
Adjusted EBITDA surpassed the high-end of our guidance range driven by solid OPEX discipline and ongoing cost synergy realization, while organic Brokerage GTV outperformed the market by 680 basis points on a pro forma basis.
Robert Reffkin, Founder and Chief Executive Officer of Compass
Our Q3 results also demonstrate the cash flow generative nature of our business. In a quarter where industry transactions were down year-over-year, we generated $248 million in operating cash flow and $240 million in free cash flow.
Scott Wahlers, Chief Financial Officer of Compass
Not in the filing
stated, not guessed- Gross margin was not reported.
- GAAP gross profit was not reported.
- Q4 2026 gross margin guidance was not reported.
- Q4 2026 operating expense guidance was not reported.
- Q4 2026 tax rate guidance was not reported.
- Q4 2026 free cash flow guidance was not reported.
- A reconciliation of Q4 Adjusted EBITDA guidance to GAAP net income or loss was not provided because the company stated that certain excluded expenses cannot be reasonably calculated or predicted.
- Share repurchases were not reported.
- Dividends were not reported.
- Previous-release outlook was not provided, so no reported results were compared with prior guidance.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
Compass, a NYSE‑listed real‑estate brokerage, filed an 8‑K reporting its Q3 2026 financials.
Ticker impact
Compass reported record Q3 2026 results with revenue up 111% YoY to $3.90B and GAAP net income of $62M.
likely upward pressure as the market prices in the earnings beat and strong cash flow.
The company delivered all‑time high revenue, net income and cash flow in a down‑market environment, improving its balance sheet and enabling debt repayment.
Market effects
Positive earnings may lift the broader real‑estate services sector and peers such as Redfin and Zillow.
Strengthens sentiment for U.S. residential real‑estate markets despite overall transaction slowdown.
Compass's global footprint means the results could influence international real‑estate brokerage sentiment.
Counterpoint
The surge in revenue may be unsustainable if housing demand continues to soften, risking a future slowdown.
Key entities
- ExecutiveRobert Reffkin
Founder and CEO who commented on the results.
- ExecutiveScott Wahlers
Chief Financial Officer who highlighted cash flow and debt metrics.
