The Clap Compass Inc (NYSE: COMP), a real estate brokerage, is cutting costs to try and improve cash flow.
The Deets The real estate market faced numerous challenges in 2022, as Compass reported a net loss of $101 million in Q2 2022. There also seems to be no sign of improvement in the current state of the real estate market.
For that reason, Compass will implement a cost-saving strategy that will follow earlier plans in June of reducing 10% of the workforce. The strategy is expected to save $320 million, pushing Compass towards a positive cash flow.
Why this Matters Compass shares dropped by almost 20% following the news. The stock has dropped by nearly 49% this year, indicating the difficulties faced in the real estate market.