Release Date: February 27, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Could you elaborate on your cost savings and efficiency opportunities, and how you're balancing profitability with maintaining operational scale in a depressed housing market? A: Selim Freiha, CFO: We've taken significant actions to reduce our fixed cost base, including the disposition of Mainstay and a reduction in force, expecting $85 million in cost savings. In 2025, we'll continue seeking efficiencies. Despite the challenging environment, we've reduced losses by $500 million year-over-year and aim to further reduce them in 2025. We believe our current fixed cost levels can support higher growth without scaling costs back up significantly.
Q: Can you provide an update on the Marketplace in Charlotte and Raleigh and your confidence in expanding it? A: Carrie Wheeler, CEO: We've seen high customer trial rates and good clearance rates in Marketplace, even with less visibility than MLS. Marketplace attracts sellers who aren't ready for MLS due to home condition or other factors. We see potential in offering these homes to buyers facing affordability pressures and will continue testing in our current markets.
Q: How are you managing your debt and liquidity in the current interest rate environment? A: Selim Freiha, CFO: We've extended more than half of our facilities, increasing borrowing capacity at similar or better credit spreads. Over 90% of our $8 billion borrowing capacity is extended through at least 2026. We have $1.1 billion in capital and are constantly evaluating our capital structure to support our balance sheet.
Q: How are you approaching your buy box and market expansion in the current challenging market? A: Carrie Wheeler, CEO: We haven't pulled back on our buy box expansion. Instead, we've improved price segmentation to adjust spreads for different homes. We're focusing on better pricing to optimize conversion without retrenching from our buy box.
Q: How are you managing operating expenses and what efficiencies can we expect throughout the year? A: Selim Freiha, CFO: Operating expenses in Q1 are slightly up due to higher inventory, but we expect costs to decrease over the year as we realize the full impact of cost-saving initiatives. We'll also adjust marketing spend to align with periods when spreads are lower, optimizing effectiveness.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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