Here's Why Compass Shares Are Falling Today

Shares of Compass Inc. COMP are falling today following a worse-than-expected earnings report.

Why Is It Moving?

After the bell on Monday, the real estate company announced its second-quarter earnings which fell below the consensus analyst estimates. 

The company reported revenues of $2.02 billion while it was estimated at $2.11 billion. In addition, the company’s earnings per share (EPS) was reported at –$0.19 which is below the estimated –$0.01.

In the earnings report, CEO Robert Reffkin said that the company would implement a cost reduction program due to the recent challenges the real estate industry has been facing. "Given the challenges the real estate market has faced so far this year and the likelihood that this difficult environment will continue for the foreseeable future, we are announcing a significant cost reduction program… We expect to complete all targeted cost reductions by the end of this calendar year."

Finally, Compass announced its quarter-three and updated its full year 2022 guidence in Monday's report. The quarter-three outlook includes expected revenues of $1.4 to $1.5 billion and an adjusted EBITDA of -$85 to -$60 million. 

In its first-quarter earnings report, Compass set a full year revenue outlook of $7.6 billion to $8.0 billion and an adjusted EBITDA outlook of "at least breakeven." Now, the company has cut its previous guidence to include a revenue outlook of $6.15 to $6.45 billion and an adjusted EBITDA outlook of -$225 to -$150 million.

COMP Price Action: Shares are down 14.0% to $4.03 during Tuesday’s pre-market trading session, according to Benzinga Pro.

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