Redfin Corporation (NASDAQ:RDFN) today announced results for its third quarter ended September 30, 2023.
Third Quarter 2023
Third quarter revenue was $269.0 million, a decrease of 12% compared to the third quarter of 2022. Gross profit was $98.3 million, an increase of 8% year-over-year. Real estate services gross profit was $54.1 million, a decrease of 2% year-over-year, and real estate services gross margin was 30%, compared to 26% in the third quarter of 2022.
Net loss was $19.0 million, compared to a net loss of $90.2 million in the third quarter of 2022. Net loss attributable to common stock was $19.3 million. Net loss per share attributable to common stock, diluted, was $0.17, compared to net loss per share, diluted, of $0.83 in the third quarter of 2022.
"In a worsening housing market, Redfin earned an adjusted EBITDA profit, a $59 million improvement over the third quarter of 2022, all while growing traffic and gaining share," said Redfin CEO Glenn Kelman. "In October, we raised capital, began generating revenues from a new digital business, and launched all-variable agent pay in California. This downturn has only made us stronger."
Third Quarter Highlights
- Third quarter market share was 0.78% of U.S. existing home sales by units, compared to 0.75% in the second quarter of 2023.
- Redfin's mobile apps and website reached more than 51 million average monthly users, up 1% compared to the third quarter of 2022.
- Achieved mortgage cross-selling attach rate of 18% in the third quarter, despite strong headwinds.
- Sustained momentum in loyalty sales, with 36% of sales coming from loyalty customers in Q3 2023 compared to 33% in Q3 2022.
- Announced a new construction partnership that will add thousands of new listings to Redfin and provide customers with richer information about newly built homes and communities.
-
Delivered software to improve customer and agent experience while driving customer contacts and boosting traffic to Redfin:
- Added wind risk data to home description pages, making Redfin the first brokerage to publish wind risk information for nearly every for-sale home in the U.S.
- Launched a new design system for rental detail pages, improving the visual appearance and driving significant increases in user engagement. We applied the same design system to the tour checkout process for customers touring with a Redfin partner agent, leading to an increase in contacts.
- Improved call filters on our customer service line, allowing Redfin sales advisors to spend more time helping high-intent customers.
- Simplified Redfin Estimate section for off-market home detail pages, making it easier for consumers to find the information they need and generating a 5% increase in listing contacts.
Business Outlook
The following forward-looking statements reflect Redfin's expectations as of November 2, 2023, and are subject to substantial uncertainty.
For the fourth quarter of 2023 we expect:
- Total revenue between $211 million and $226 million, representing a year-over-year change between (5)% and 2% compared to the fourth quarter of 2022. Included within total revenue are real estate services revenue between $127 million and $137 million, rentals revenue between $49 million and $50 million, mortgage revenue between $26 million and $29 million and other revenue of $9 million to $10 million.
- Total net loss is expected to be between $27 million and $18 million, compared to net loss of $62 million in the fourth quarter of 2022. This guidance includes approximately $20 million in total marketing expenses, $18 million of stock-based compensation, $15 million in depreciation and amortization, $27 million in gains on extinguishment of convertible senior notes and $2 million to $3 million in net interest expense. Adjusted EBITDA loss is expected to be between $19 million and $9 million. Furthermore, we expect to pay a quarterly dividend of 30,640 shares of common stock to our preferred stockholder.
Conference Call
Redfin will webcast a conference call to discuss the results at 1:30 p.m. Pacific Time today. The webcast will be open to the public at http://investors.redfin.com. The webcast will remain available on the investor relations website for at least three months following the conference call.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws, including our future operating results, as described under Business Outlook. We believe our expectations related to these forward-looking statements are reasonable, but actual results may turn out to be materially different. For factors that could cause actual results to differ materially from the forward-looking statements in this press release, please see the risks and uncertainties identified under the heading "Risk Factors" in our annual report for the year ended December 31, 2022, as supplemented by our quarterly report for the quarter ended September 30, 2023, both of which are available on our Investor Relations website at http://investors.redfin.com and on the SEC website at www.sec.gov. All forward-looking statements reflect our beliefs and assumptions only as of the date of this press release. We undertake no obligation to update forward-looking statements to reflect future events or circumstances.
Non-GAAP Financial Measure
To supplement our consolidated financial statements that are prepared and presented in accordance with GAAP, we also compute and present adjusted EBITDA, which is a non-GAAP financial measure. We believe adjusted EBITDA is useful for investors because it enhances period-to-period comparability of our financial statements on a consistent basis and provides investors with useful insight into the underlying trends of the business. The presentation of this financial measure is not intended to be considered in isolation or as a substitute of, or superior to, our financial information prepared and presented in accordance with GAAP. Our calculation of adjusted EBITDA may be different from adjusted EBITDA or similar non-GAAP financial measures used by other companies, limiting its usefulness for comparison purposes. Our adjusted EBITDA for the three months ended September 30, 2023 and 2022 is presented below, along with a reconciliation of adjusted EBITDA to net loss.
About Redfin
Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, title insurance, and renovations services. We also run the country's #1 real estate brokerage site. Our home-buying customers see homes first with same day tours, and our lending and title services help them close quickly. Customers selling a home in certain markets can have our renovations crew fix up their home to sell for top dollar. Our rentals business empowers millions nationwide to find apartments and houses for rent. Customers who buy and sell with Redfin pay a 1% listing fee, subject to minimums, less than half of what brokerages commonly charge. Since launching in 2006, we've saved customers more than $1.5 billion in commissions. We serve more than 100 markets across the U.S. and Canada and employ over 4,000 people.
Redfin-F
Redfin Corporation and Subsidiaries |
|||||||
Consolidated Balance Sheets |
|||||||
(in thousands, except share and per share amounts, unaudited) |
|||||||
|
September 30, 2023 |
|
December 31, 2022 |
||||
Assets |
|
|
|
||||
Current assets |
|
|
|
||||
Cash and cash equivalents |
$ |
125,803 |
|
|
$ |
232,200 |
|
Restricted cash |
|
1,414 |
|
|
|
2,406 |
|
Short-term investments |
|
41,752 |
|
|
|
122,259 |
|
Accounts receivable, net of allowances for credit losses of $2,529 and $2,223 |
|
55,118 |
|
|
|
46,375 |
|
Loans held for sale |
|
137,680 |
|
|
|
199,604 |
|
Prepaid expenses |
|
26,248 |
|
|
|
34,006 |
|
Other current assets |
|
8,811 |
|
|
|
7,449 |
|
Current assets of discontinued operations |
|
— |
|
|
|
132,159 |
|
Total current assets |
|
396,826 |
|
|
|
776,458 |
|
Property and equipment, net |
|
48,405 |
|
|
|
54,939 |
|
Right-of-use assets, net |
|
35,150 |
|
|
|
40,889 |
|
Mortgage servicing rights, at fair value |
|
34,773 |
|
|
|
36,261 |
|
Long-term investments |
|
5,474 |
|
|
|
29,480 |
|
Goodwill |
|
461,349 |
|
|
|
461,349 |
|
Intangible assets, net |
|
133,031 |
|
|
|
162,272 |
|
Other assets, noncurrent |
|
10,857 |
|
|
|
11,247 |
|
Noncurrent assets of discontinued operations |
|
— |
|
|
|
1,309 |
|
Total assets |
$ |
1,125,865 |
|
|
$ |
1,574,204 |
|
Liabilities, mezzanine equity, and stockholders' equity |
|
|
|
||||
Current liabilities |
|
|
|
||||
Accounts payable |
$ |
11,996 |
|
|
$ |
11,065 |
|
Accrued and other liabilities |
|
88,191 |
|
|
|
106,763 |
|
Warehouse credit facilities |
|
132,320 |
|
|
|
190,509 |
|
Convertible senior notes, net |
|
— |
|
|
|
23,431 |
|
Lease liabilities |
|
16,317 |
|
|
|
18,560 |
|
Current liabilities of discontinued operations |
|
— |
|
|
|
4,311 |
|
Total current liabilities |
|
248,824 |
|
|
|
354,639 |
|
Lease liabilities, noncurrent |
|
31,416 |
|
|
|
36,906 |
|
Convertible senior notes, net, noncurrent |
|
799,665 |
|
|
|
1,078,157 |
|
Deferred tax liabilities |
|
260 |
|
|
|
243 |
|
Noncurrent liabilities of discontinued operations |
|
— |
|
|
|
392 |
|
Total liabilities |
|
1,080,165 |
|
|
|
1,470,337 |
|
Series A convertible preferred stock—par value $0.001 per share; 10,000,000 shares authorized; 40,000 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively |
|
39,947 |
|
|
|
39,914 |
|
Stockholders' equity |
|
|
|
||||
Common stock—par value $0.001 per share; 500,000,000 shares authorized; 115,210,998 and 109,696,178 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively |
|
115 |
|
|
|
110 |
|
Additional paid-in capital |
|
806,330 |
|
|
|
757,951 |
|
Accumulated other comprehensive loss |
|
(257 |
) |
|
|
(801 |
) |
Accumulated deficit |
|
(800,435 |
) |
|
|
(693,307 |
) |
Total stockholders' equity |
|
5,753 |
|
|
|
63,953 |
|
Total liabilities, mezzanine equity, and stockholders' equity |
$ |
1,125,865 |
|
|
$ |
1,574,204 |
|
Redfin Corporation and Subsidiaries |
|||||||||||||||
Consolidated Statements of Comprehensive Loss |
|||||||||||||||
(in thousands, except share and per share amounts, unaudited) |
|||||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenue |
$ |
268,956 |
|
|
$ |
305,774 |
|
|
$ |
758,595 |
|
|
$ |
877,639 |
|
Cost of revenue |
|
170,616 |
|
|
|
215,109 |
|
|
|
501,927 |
|
|
|
624,089 |
|
Gross profit |
|
98,340 |
|
|
|
90,665 |
|
|
|
256,668 |
|
|
|
253,550 |
|
Operating expenses |
|
|
|
|
|
|
|
||||||||
Technology and development |
|
44,392 |
|
|
|
43,335 |
|
|
|
139,196 |
|
|
|
135,678 |
|
Marketing |
|
24,095 |
|
|
|
33,242 |
|
|
|
97,531 |
|
|
|
131,352 |
|
General and administrative |
|
55,380 |
|
|
|
57,976 |
|
|
|
186,584 |
|
|
|
182,640 |
|
Restructuring and reorganization |
|
— |
|
|
|
284 |
|
|
|
7,159 |
|
|
|
18,399 |
|
Total operating expenses |
|
123,867 |
|
|
|
134,837 |
|
|
|
430,470 |
|
|
|
468,069 |
|
Loss from continuing operations |
|
(25,527 |
) |
|
|
(44,172 |
) |
|
|
(173,802 |
) |
|
|
(214,519 |
) |
Interest income |
|
2,060 |
|
|
|
1,174 |
|
|
|
8,170 |
|
|
|
1,948 |
|
Interest expense |
|
(1,603 |
) |
|
|
(2,219 |
) |
|
|
(5,291 |
) |
|
|
(6,648 |
) |
Income tax expense |
|
(239 |
) |
|
|
(132 |
) |
|
|
(882 |
) |
|
|
(425 |
) |
Gain on extinguishment of convertible senior notes |
|
6,495 |
|
|
|
— |
|
|
|
68,848 |
|
|
|
— |
|
Other expense, net |
|
(158 |
) |
|
|
(902 |
) |
|
|
(537 |
) |
|
|
(3,077 |
) |
Net loss from continuing operations |
|
(18,972 |
) |
|
|
(46,251 |
) |
|
|
(103,494 |
) |
|
|
(222,721 |
) |
Net loss from discontinued operations |
|
— |
|
|
|
(43,994 |
) |
|
|
(3,634 |
) |
|
|
(36,476 |
) |
Net loss |
$ |
(18,972 |
) |
|
$ |
(90,245 |
) |
|
$ |
(107,128 |
) |
|
$ |
(259,197 |
) |
|
|
|
|
|
|
|
|
||||||||
Dividends on convertible preferred stock |
|
(335 |
) |
|
|
(272 |
) |
|
|
(858 |
) |
|
|
(1,416 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss from continuing operations attributable to common stock—basic and diluted |
$ |
(19,307 |
) |
|
$ |
(46,523 |
) |
|
$ |
(104,352 |
) |
|
$ |
(224,137 |
) |
Net loss attributable to common stock—basic and diluted |
$ |
(19,307 |
) |
|
$ |
(90,517 |
) |
|
$ |
(107,986 |
) |
|
$ |
(260,613 |
) |
|
|
|
|
|
|
|
|
||||||||
Net loss from continuing operations per share attributable to common stock—basic and diluted |
$ |
(0.17 |
) |
|
$ |
(0.43 |
) |
|
$ |
(0.93 |
) |
|
$ |
(2.08 |
) |
Net loss attributable to common stock per share—basic and diluted |
$ |
(0.17 |
) |
|
$ |
(0.83 |
) |
|
$ |
(0.96 |
) |
|
$ |
(2.42 |
) |
|
|
|
|
|
|
|
|
||||||||
Weighted-average shares to compute net loss per share attributable to common stock—basic and diluted |
|
114,592,679 |
|
|
|
108,618,491 |
|
|
|
112,141,342 |
|
|
|
107,566,894 |
|
|
|
|
|
|
|
|
|
||||||||
Net loss |
$ |
(18,972 |
) |
|
$ |
(90,245 |
) |
|
$ |
(107,128 |
) |
|
$ |
(259,197 |
) |
Other comprehensive income |
|
|
|
|
|
|
|
||||||||
Foreign currency translation adjustments |
|
(15 |
) |
|
|
27 |
|
|
|
(73 |
) |
|
|
65 |
|
Unrealized gain on available-for-sale debt securities |
|
210 |
|
|
|
34 |
|
|
|
617 |
|
|
|
812 |
|
Comprehensive loss |
$ |
(18,777 |
) |
|
$ |
(90,184 |
) |
|
$ |
(106,584 |
) |
|
$ |
(258,320 |
) |
(1) Includes stock-based compensation as follows: |
|||||||||||||||
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
||||||||||||
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Cost of revenue |
$ |
3,037 |
|
|
$ |
4,165 |
|
|
$ |
10,173 |
|
|
$ |
10,771 |
|
Technology and development |
|
8,391 |
|
|
|
6,353 |
|
|
|
24,759 |
|
|
|
20,230 |
|
Marketing |
|
1,337 |
|
|
|
1,002 |
|
|
|
3,836 |
|
|
|
2,939 |
|
General and administrative |
|
6,035 |
|
|
|
4,904 |
|
|
|
16,380 |
|
|
|
13,022 |
|
Total |
$ |
18,800 |
|
|
$ |
16,424 |
|
|
$ |
55,148 |
|
|
$ |
46,962 |
|
Redfin Corporation and Subsidiaries |
|||||||
Consolidated Statements of Cash Flows |
|||||||
(in thousands, unaudited) |
|||||||
|
Nine Months Ended September 30, |
||||||
|
|
2023 |
|
|
|
2022 |
|
Operating Activities |
|
|
|
||||
Net loss |
$ |
(107,128 |
) |
|
$ |
(259,197 |
) |
Adjustments to reconcile net loss to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
48,443 |
|
|
|
47,438 |
|
Stock-based compensation |
|
55,382 |
|
|
|
51,672 |
|
Amortization of debt discount and issuance costs |
|
2,873 |
|
|
|
4,358 |
|
Non-cash lease expense |
|
12,909 |
|
|
|
11,313 |
|
Impairment costs |
|
113 |
|
|
|
913 |
|
Net (gain) loss on IRLCs, forward sales commitments, and loans held for sale |
|
(1,767 |
) |
|
|
4,228 |
|
Change in fair value of mortgage servicing rights, net |
|
1,065 |
|
|
|
(1,472 |
) |
Gain on extinguishment of convertible senior notes |
|
(68,848 |
) |
|
|
— |
|
Other |
|
(2,013 |
) |
|
|
3,254 |
|
Change in assets and liabilities: |
|
|
|
||||
Accounts receivable, net |
|
(238 |
) |
|
|
(17,052 |
) |
Inventory |
|
114,232 |
|
|
|
56,990 |
|
Prepaid expenses and other assets |
|
9,696 |
|
|
|
(2,721 |
) |
Accounts payable |
|
177 |
|
|
|
(1,875 |
) |
Accrued and other liabilities, deferred tax liabilities, and payroll tax liabilities, noncurrent |
|
(19,346 |
) |
|
|
(24,202 |
) |
Lease liabilities |
|
(14,864 |
) |
|
|
(12,435 |
) |
Origination of mortgage servicing rights |
|
(699 |
) |
|
|
(2,774 |
) |
Proceeds from sale of mortgage servicing rights |
|
1,122 |
|
|
|
1,314 |
|
Origination of loans held for sale |
|
(2,798,337 |
) |
|
|
(3,091,099 |
) |
Proceeds from sale of loans originated as held for sale |
|
2,858,656 |
|
|
|
3,082,858 |
|
Net cash provided by (used in) operating activities |
|
91,428 |
|
|
|
(148,489 |
) |
Investing activities |
|
|
|
||||
Purchases of property and equipment |
|
(9,235 |
) |
|
|
(17,496 |
) |
Purchases of investments |
|
(76,866 |
) |
|
|
(145,273 |
) |
Sales of investments |
|
124,681 |
|
|
|
12,946 |
|
Maturities of investments |
|
59,383 |
|
|
|
66,055 |
|
Cash paid for acquisition, net of cash, cash equivalents, and restricted cash acquired |
|
— |
|
|
|
(97,341 |
) |
Net cash provided by (used in) investing activities |
|
97,963 |
|
|
|
(181,109 |
) |
Financing activities |
|
|
|
||||
Proceeds from the issuance of common stock pursuant to employee equity plans |
|
5,790 |
|
|
|
9,679 |
|
Tax payments related to net share settlements on restricted stock units |
|
(15,961 |
) |
|
|
(6,650 |
) |
Borrowings from warehouse credit facilities |
|
2,803,589 |
|
|
|
3,080,606 |
|
Repayments to warehouse credit facilities |
|
(2,861,779 |
) |
|
|
(3,069,728 |
) |
Borrowings from secured revolving credit facility |
|
— |
|
|
|
552,051 |
|
Repayments to secured revolving credit facility |
|
— |
|
|
|
(549,416 |
) |
Cash paid for secured revolving credit facility issuance costs |
|
— |
|
|
|
(764 |
) |
Principal payments under finance lease obligations |
|
(73 |
) |
|
|
(680 |
) |
Repurchases of convertible senior notes |
|
(212,401 |
) |
|
|
— |
|
Repayments of convertible senior notes |
|
(23,512 |
) |
|
|
— |
|
Net cash (used in) provided by financing activities |
|
(304,347 |
) |
|
|
15,098 |
|
Effect of exchange rate changes on cash, cash equivalents, and restricted cash |
|
(73 |
) |
|
|
(65 |
) |
Net change in cash, cash equivalents, and restricted cash |
|
(115,029 |
) |
|
|
(314,565 |
) |
Cash, cash equivalents, and restricted cash: |
|
|
|
||||
Beginning of period |
|
242,246 |
|
|
|
718,281 |
|
End of period |
$ |
127,217 |
|
|
$ |
403,716 |
|
Redfin Corporation and Subsidiaries |
|||||||||||||||||||||||||||||||
Supplemental Financial Information and Business Metrics |
|||||||||||||||||||||||||||||||
(unaudited) |
|||||||||||||||||||||||||||||||
|
Three Months Ended |
||||||||||||||||||||||||||||||
|
Sep. 30,
|
|
Jun. 30,
|
|
Mar. 31,
|
|
Dec. 31,
|
|
Sep. 30,
|
|
Jun. 30,
|
|
Mar. 31,
|
|
Dec. 31,
|
||||||||||||||||
Monthly average visitors (in thousands) |
|
51,309 |
|
|
|
52,308 |
|
|
|
50,440 |
|
|
|
43,847 |
|
|
|
50,785 |
|
|
|
52,698 |
|
|
|
51,287 |
|
|
|
44,665 |
|
Real estate services transactions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Brokerage |
|
13,075 |
|
|
|
13,716 |
|
|
|
10,301 |
|
|
|
12,743 |
|
|
|
18,245 |
|
|
|
20,565 |
|
|
|
15,001 |
|
|
|
19,428 |
|
Partner |
|
4,351 |
|
|
|
3,952 |
|
|
|
3,187 |
|
|
|
2,742 |
|
|
|
3,507 |
|
|
|
3,983 |
|
|
|
3,417 |
|
|
|
4,603 |
|
Total |
|
17,426 |
|
|
|
17,668 |
|
|
|
13,488 |
|
|
|
15,485 |
|
|
|
21,752 |
|
|
|
24,548 |
|
|
|
18,418 |
|
|
|
24,031 |
|
Real estate services revenue per transaction |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Brokerage |
$ |
12,704 |
|
|
$ |
12,376 |
|
|
$ |
11,556 |
|
|
$ |
10,914 |
|
|
$ |
11,103 |
|
|
$ |
11,692 |
|
|
$ |
11,191 |
|
|
$ |
10,900 |
|
Partner |
|
2,677 |
|
|
|
2,756 |
|
|
|
2,592 |
|
|
|
2,611 |
|
|
|
2,556 |
|
|
|
2,851 |
|
|
|
2,814 |
|
|
|
2,819 |
|
Aggregate |
|
10,200 |
|
|
|
10,224 |
|
|
|
9,438 |
|
|
|
9,444 |
|
|
|
9,725 |
|
|
|
10,258 |
|
|
|
9,637 |
|
|
|
9,352 |
|
U.S. market share by units(1) |
|
0.78 |
% |
|
|
0.75 |
% |
|
|
0.79 |
% |
|
|
0.76 |
% |
|
|
0.80 |
% |
|
|
0.83 |
% |
|
|
0.79 |
% |
|
|
0.78 |
% |
Revenue from top-10 Redfin markets as a percentage of real estate services revenue |
|
56 |
% |
|
|
55 |
% |
|
|
53 |
% |
|
|
57 |
% |
|
|
58 |
% |
|
|
59 |
% |
|
|
57 |
% |
|
|
61 |
% |
Average number of lead agents |
|
1,744 |
|
|
|
1,792 |
|
|
|
1,876 |
|
|
|
2,022 |
|
|
|
2,293 |
|
|
|
2,640 |
|
|
|
2,750 |
|
|
|
2,485 |
|
Mortgage originations by dollars (in millions) |
$ |
1,110 |
|
|
$ |
1,282 |
|
|
$ |
991 |
|
|
$ |
1,036 |
|
|
$ |
1,557 |
|
|
$ |
1,565 |
|
|
$ |
159 |
|
|
$ |
242 |
|
Mortgage originations by units (in ones) |
|
2,786 |
|
|
|
3,131 |
|
|
|
2,444 |
|
|
|
2,631 |
|
|
|
3,720 |
|
|
|
3,860 |
|
|
|
414 |
|
|
|
591 |
|
(1) Prior to the second quarter of 2022, we reported our U.S. market share based on the aggregate home value of our real estate services transactions, relative to the aggregate value of all U.S. home sales, which we computed based on the mean sale price of U.S. homes provided by the National Association of REALTORS® ("NAR"). Beginning in the second quarter of 2022, NAR (1) revised its methodology of computing the mean sale price, (2) restated its previously reported mean sale price beginning from January 2020 (and indicated that previously reported mean sale price prior to January 2020 is not comparable), and (3) discontinued publication of the mean sale price as part of its primary data set. Due to these changes, as of the second quarter of 2022, we report our U.S. market share based on the number of homes sold, rather than the dollar value of homes sold. Our market share by number of homes sold has historically been lower than our market share by dollar value of homes sold. We also stopped reporting the aggregate home value of our real estate services transactions. |
Redfin Corporation and Subsidiaries |
|||||||||||||||||||||||
Supplemental Financial Information |
|||||||||||||||||||||||
(unaudited, in thousands) |
|||||||||||||||||||||||
|
Three Months Ended September 30, 2023 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Revenue |
$ |
177,750 |
|
|
$ |
47,410 |
|
|
$ |
32,923 |
|
|
$ |
10,873 |
|
$ |
— |
|
|
$ |
268,956 |
|
|
Cost of revenue |
|
123,684 |
|
|
|
10,824 |
|
|
|
29,629 |
|
|
|
6,479 |
|
|
|
— |
|
|
|
170,616 |
|
Gross profit |
|
54,066 |
|
|
|
36,586 |
|
|
|
3,294 |
|
|
|
4,394 |
|
|
|
— |
|
|
|
98,340 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Technology and development |
|
25,711 |
|
|
|
15,813 |
|
|
|
800 |
|
|
|
1,133 |
|
|
|
935 |
|
|
|
44,392 |
|
Marketing |
|
10,785 |
|
|
|
12,245 |
|
|
|
1,088 |
|
|
|
20 |
|
|
|
(43 |
) |
|
|
24,095 |
|
General and administrative |
|
18,418 |
|
|
|
21,838 |
|
|
|
6,670 |
|
|
|
952 |
|
|
|
7,502 |
|
|
|
55,380 |
|
Total operating expenses |
|
54,914 |
|
|
|
49,896 |
|
|
|
8,558 |
|
|
|
2,105 |
|
|
|
8,394 |
|
|
|
123,867 |
|
(Loss) income from continuing operations |
|
(848 |
) |
|
|
(13,310 |
) |
|
|
(5,264 |
) |
|
|
2,289 |
|
|
|
(8,394 |
) |
|
|
(25,527 |
) |
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net |
|
41 |
|
|
|
42 |
|
|
|
(73 |
) |
|
|
207 |
|
|
|
6,338 |
|
|
|
6,555 |
|
Net (loss) income from continuing operations |
$ |
(807 |
) |
|
$ |
(13,268 |
) |
|
$ |
(5,337 |
) |
|
$ |
2,496 |
|
|
$ |
(2,056 |
) |
|
$ |
(18,972 |
) |
|
Three Months Ended September 30, 2023 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Net (loss) income from continuing operations |
$ |
(807 |
) |
|
$ |
(13,268 |
) |
|
$ |
(5,337 |
) |
|
$ |
2,496 |
|
|
$ |
(2,056 |
) |
|
$ |
(18,972 |
) |
Interest income(1) |
|
(41 |
) |
|
|
(81 |
) |
|
|
(2,886 |
) |
|
|
(207 |
) |
|
|
(1,732 |
) |
|
|
(4,947 |
) |
Interest expense(2) |
|
— |
|
|
|
— |
|
|
|
3,132 |
|
|
|
— |
|
|
|
1,598 |
|
|
|
4,730 |
|
Income tax expense |
|
— |
|
|
|
37 |
|
|
|
70 |
|
|
|
— |
|
|
|
132 |
|
|
|
239 |
|
Depreciation and amortization |
|
3,123 |
|
|
|
9,681 |
|
|
|
947 |
|
|
|
233 |
|
|
|
312 |
|
|
|
14,296 |
|
Stock-based compensation(3) |
|
11,151 |
|
|
|
4,255 |
|
|
|
473 |
|
|
|
574 |
|
|
|
2,347 |
|
|
|
18,800 |
|
Gain on extinguishment of convertible senior notes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(6,495 |
) |
|
|
(6,495 |
) |
Adjusted EBITDA |
$ |
13,426 |
|
|
$ |
624 |
|
|
$ |
(3,601 |
) |
|
$ |
3,096 |
|
|
$ |
(5,894 |
) |
|
$ |
7,651 |
|
(1) Interest income includes $2.9 million of interest income related to originated mortgage loans for the three months ended September 30, 2023. |
(2) Interest expense includes $3.1 million of interest expense related to our warehouse credit facilities for the three months ended September 30, 2023. |
(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information. |
|
Three Months Ended September 30, 2022 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Revenue(1) |
$ |
211,540 |
|
|
$ |
38,686 |
|
|
$ |
48,469 |
|
|
$ |
7,079 |
|
|
$ |
— |
|
|
$ |
305,774 |
|
Cost of revenue |
|
156,632 |
|
|
|
8,676 |
|
|
|
43,783 |
|
|
|
6,018 |
|
|
|
— |
|
|
|
215,109 |
|
Gross profit |
|
54,908 |
|
|
|
30,010 |
|
|
|
4,686 |
|
|
|
1,061 |
|
|
|
— |
|
|
|
90,665 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Technology and development |
|
25,709 |
|
|
|
15,385 |
|
|
|
985 |
|
|
|
751 |
|
|
|
505 |
|
|
|
43,335 |
|
Marketing |
|
18,772 |
|
|
|
12,678 |
|
|
|
1,653 |
|
|
|
48 |
|
|
|
91 |
|
|
|
33,242 |
|
General and administrative |
|
20,244 |
|
|
|
22,722 |
|
|
|
7,073 |
|
|
|
784 |
|
|
|
7,153 |
|
|
|
57,976 |
|
Restructuring and reorganization |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
284 |
|
|
|
284 |
|
Total operating expenses |
|
64,725 |
|
|
|
50,785 |
|
|
|
9,711 |
|
|
|
1,583 |
|
|
|
8,033 |
|
|
|
134,837 |
|
Loss from continuing operations |
|
(9,817 |
) |
|
|
(20,775 |
) |
|
|
(5,025 |
) |
|
|
(522 |
) |
|
|
(8,033 |
) |
|
|
(44,172 |
) |
Interest income, interest expense, income tax expense, and other expense, net |
|
— |
|
|
|
397 |
|
|
|
(129 |
) |
|
|
40 |
|
|
|
(2,387 |
) |
|
|
(2,079 |
) |
Net loss from continuing operations |
$ |
(9,817 |
) |
|
$ |
(20,378 |
) |
|
$ |
(5,154 |
) |
|
$ |
(482 |
) |
|
$ |
(10,420 |
) |
|
$ |
(46,251 |
) |
(1) Included in revenue is $4.9 million from providing services to our discontinued properties segment. |
|
Three Months Ended September 30, 2022 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Net loss from continuing operations |
$ |
(9,817 |
) |
|
$ |
(20,378 |
) |
|
$ |
(5,154 |
) |
|
$ |
(482 |
) |
|
$ |
(10,420 |
) |
|
$ |
(46,251 |
) |
Interest income(1) |
|
— |
|
|
|
— |
|
|
|
(4,049 |
) |
|
|
(42 |
) |
|
|
(1,115 |
) |
|
|
(5,206 |
) |
Interest expense(2) |
|
— |
|
|
|
— |
|
|
|
3,364 |
|
|
|
— |
|
|
|
2,215 |
|
|
|
5,579 |
|
Income tax expense |
|
— |
|
|
|
(355 |
) |
|
|
141 |
|
|
|
— |
|
|
|
346 |
|
|
|
132 |
|
Depreciation and amortization |
|
4,388 |
|
|
|
9,683 |
|
|
|
1,053 |
|
|
|
241 |
|
|
|
291 |
|
|
|
15,656 |
|
Stock-based compensation(3) |
|
9,834 |
|
|
|
3,632 |
|
|
|
1,209 |
|
|
|
341 |
|
|
|
1,408 |
|
|
|
16,424 |
|
Acquisition-related costs(4) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
13 |
|
|
|
13 |
|
Restructuring and reorganization(5) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
284 |
|
|
|
284 |
|
Impairment(6) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
913 |
|
|
|
913 |
|
Adjusted EBITDA |
$ |
4,405 |
|
|
$ |
(7,418 |
) |
|
$ |
(3,436 |
) |
|
$ |
58 |
|
|
$ |
(6,065 |
) |
|
$ |
(12,456 |
) |
(1) Interest income includes $4.0 million of interest income related to originated mortgage loans for the three months ended September 30, 2022. |
(2) Interest expense includes $3.4 million of interest expense related to our warehouse credit facilities for the three months ended September 30, 2022. |
(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information. |
(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies. |
(5) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention for our rentals segment due to the restructuring and reorganization activities from our acquisition of Rent. |
(6) Impairment consists of an impairment loss due to subleasing one of our operating leases. |
|
Nine Months Ended September 30, 2023 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Revenue(1) |
$ |
485,687 |
|
|
$ |
135,636 |
|
|
$ |
107,838 |
|
|
$ |
29,434 |
|
$ |
— |
|
|
$ |
758,595 |
|
|
Cost of revenue |
|
359,625 |
|
|
|
31,016 |
|
|
|
93,108 |
|
|
|
18,178 |
|
|
|
— |
|
|
|
501,927 |
|
Gross profit |
|
126,062 |
|
|
|
104,620 |
|
|
|
14,730 |
|
|
|
11,256 |
|
|
|
— |
|
|
|
256,668 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Technology and development |
|
82,650 |
|
|
|
48,081 |
|
|
|
2,177 |
|
|
|
3,475 |
|
|
|
2,813 |
|
|
|
139,196 |
|
Marketing |
|
51,849 |
|
|
|
42,509 |
|
|
|
3,122 |
|
|
|
46 |
|
|
|
5 |
|
|
|
97,531 |
|
General and administrative |
|
58,997 |
|
|
|
73,445 |
|
|
|
20,323 |
|
|
|
3,049 |
|
|
|
30,770 |
|
|
|
186,584 |
|
Restructuring and reorganization |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7,159 |
|
|
|
7,159 |
|
Total operating expenses |
|
193,496 |
|
|
|
164,035 |
|
|
|
25,622 |
|
|
|
6,570 |
|
|
|
40,747 |
|
|
|
430,470 |
|
(Loss) income from continuing operations |
|
(67,434 |
) |
|
|
(59,415 |
) |
|
|
(10,892 |
) |
|
|
4,686 |
|
|
|
(40,747 |
) |
|
|
(173,802 |
) |
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net |
|
41 |
|
|
|
115 |
|
|
|
(224 |
) |
|
|
475 |
|
|
|
69,901 |
|
|
|
70,308 |
|
Net (loss) income from continuing operations |
$ |
(67,393 |
) |
|
$ |
(59,300 |
) |
|
$ |
(11,116 |
) |
|
$ |
5,161 |
|
|
$ |
29,154 |
|
|
$ |
(103,494 |
) |
(1) Included in revenue is $1.2 million from providing services to our discontinued properties segment. |
|
Nine Months Ended September 30, 2023 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Net (loss) income from continuing operations |
$ |
(67,393 |
) |
|
$ |
(59,300 |
) |
|
$ |
(11,116 |
) |
|
$ |
5,161 |
|
|
$ |
29,154 |
|
|
$ |
(103,494 |
) |
Interest income(1) |
|
(41 |
) |
|
|
(238 |
) |
|
|
(9,062 |
) |
|
|
(475 |
) |
|
|
(7,400 |
) |
|
|
(17,216 |
) |
Interest expense(2) |
|
— |
|
|
|
— |
|
|
|
9,737 |
|
|
|
— |
|
|
|
5,285 |
|
|
|
15,022 |
|
Income tax expense |
|
— |
|
|
|
123 |
|
|
|
222 |
|
|
|
— |
|
|
|
537 |
|
|
|
882 |
|
Depreciation and amortization |
|
12,819 |
|
|
|
30,068 |
|
|
|
2,929 |
|
|
|
756 |
|
|
|
1,745 |
|
|
|
48,317 |
|
Stock-based compensation(3) |
|
33,041 |
|
|
|
11,580 |
|
|
|
2,554 |
|
|
|
1,696 |
|
|
|
6,277 |
|
|
|
55,148 |
|
Acquisition-related costs(4) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8 |
|
|
|
8 |
|
Restructuring and reorganization(5) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
7,159 |
|
|
|
7,159 |
|
Impairment(6) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
113 |
|
|
|
113 |
|
Gain on extinguishment of convertible senior notes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(68,848 |
) |
|
|
(68,848 |
) |
Adjusted EBITDA |
$ |
(21,574 |
) |
|
$ |
(17,767 |
) |
|
$ |
(4,736 |
) |
|
$ |
7,138 |
|
|
$ |
(25,970 |
) |
|
$ |
(62,909 |
) |
(1) Interest income includes $9.0 million of interest income related to originated mortgage loans for the nine months ended September 30, 2023. |
(2) Interest expense includes $9.7 million of interest expense related to our warehouse credit facilities for the nine months ended September 30, 2023. |
(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information. |
(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies. |
(5) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention due to the restructuring and reorganization activities from our acquisitions of Bay Equity and Rent., and from our June 2022, October 2022, and March 2023 workforce reductions. |
(6) Impairment consists of an impairment loss due to subleasing one of our operating leases. |
|
Nine Months Ended September 30, 2022 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Revenue(1) |
$ |
640,835 |
|
|
$ |
114,979 |
|
|
$ |
104,484 |
|
|
$ |
17,341 |
|
|
$ |
— |
|
|
$ |
877,639 |
|
Cost of revenue |
|
488,114 |
|
|
|
23,769 |
|
|
|
95,616 |
|
|
|
16,590 |
|
|
|
— |
|
|
|
624,089 |
|
Gross profit |
|
152,721 |
|
|
|
91,210 |
|
|
|
8,868 |
|
|
|
751 |
|
|
|
— |
|
|
|
253,550 |
|
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Technology and development |
|
80,144 |
|
|
|
44,539 |
|
|
|
5,236 |
|
|
|
2,975 |
|
|
|
2,784 |
|
|
|
135,678 |
|
Marketing |
|
90,380 |
|
|
|
36,806 |
|
|
|
3,525 |
|
|
|
173 |
|
|
|
468 |
|
|
|
131,352 |
|
General and administrative |
|
67,578 |
|
|
|
68,738 |
|
|
|
18,047 |
|
|
|
2,346 |
|
|
|
25,931 |
|
|
|
182,640 |
|
Restructuring and reorganization |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
18,399 |
|
|
|
18,399 |
|
Total operating expenses |
|
238,102 |
|
|
|
150,083 |
|
|
|
26,808 |
|
|
|
5,494 |
|
|
|
47,582 |
|
|
|
468,069 |
|
Loss from operations |
|
(85,381 |
) |
|
|
(58,873 |
) |
|
|
(17,940 |
) |
|
|
(4,743 |
) |
|
|
(47,582 |
) |
|
|
(214,519 |
) |
Interest income, interest expense, income tax expense, and other expense, net |
|
(123 |
) |
|
|
1,098 |
|
|
|
(164 |
) |
|
|
51 |
|
|
|
(9,064 |
) |
|
|
(8,202 |
) |
Net loss from continuing operations |
$ |
(85,504 |
) |
|
$ |
(57,775 |
) |
|
$ |
(18,104 |
) |
|
$ |
(4,692 |
) |
|
$ |
(56,646 |
) |
|
$ |
(222,721 |
) |
(1) Included in revenue is $14.9 million from providing services to our discontinued properties segment. |
|
Nine Months Ended September 30, 2022 |
||||||||||||||||||||||
|
Real estate
|
|
Rentals |
|
Mortgage |
|
Other |
|
Corporate
|
|
Total |
||||||||||||
Net loss from continuing operations |
$ |
(85,504 |
) |
|
$ |
(57,775 |
) |
|
$ |
(18,104 |
) |
|
$ |
(4,692 |
) |
|
$ |
(56,646 |
) |
|
$ |
(222,721 |
) |
Interest income(1) |
|
— |
|
|
|
(1 |
) |
|
|
(7,296 |
) |
|
|
(55 |
) |
|
|
(1,876 |
) |
|
|
(9,228 |
) |
Interest expense(2) |
|
— |
|
|
|
— |
|
|
|
5,599 |
|
|
|
— |
|
|
|
6,642 |
|
|
|
12,241 |
|
Income tax expense |
|
— |
|
|
|
(789 |
) |
|
|
174 |
|
|
|
— |
|
|
|
1,040 |
|
|
|
425 |
|
Depreciation and amortization |
|
12,957 |
|
|
|
28,550 |
|
|
|
2,425 |
|
|
|
814 |
|
|
|
909 |
|
|
|
45,655 |
|
Stock-based compensation(3) |
|
29,644 |
|
|
|
8,611 |
|
|
|
2,590 |
|
|
|
1,151 |
|
|
|
4,966 |
|
|
|
46,962 |
|
Acquisition-related costs(4) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,437 |
|
|
|
2,437 |
|
Restructuring and reorganization(5) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
18,399 |
|
|
|
18,399 |
|
Impairment(6) |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
913 |
|
|
|
913 |
|
Adjusted EBITDA |
$ |
(42,903 |
) |
|
$ |
(21,404 |
) |
|
$ |
(14,612 |
) |
|
$ |
(2,782 |
) |
|
$ |
(23,216 |
) |
|
$ |
(104,917 |
) |
(1) Interest income includes $7.3 million of interest income related to originated mortgage loans for the nine months ended September 30, 2023. |
(2) Interest expense includes $5.6 million of interest expense related to our warehouse credit facilities for the nine months ended September 30, 2023. |
(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information. |
(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies. |
(5) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention due to the restructuring and reorganization activities from our acquisitions of Bay Equity and Rent., and from our June 2022, October 2022, and March 2023 workforce reductions. |
(6) Impairment consists of an impairment loss due to subleasing one of our operating leases. |
Reconciliation of Adjusted EBITDA Guidance to Net Loss Guidance |
|||||
(unaudited, in millions) |
|||||
|
Q4 2023 |
||||
|
Low |
|
High |
||
Net loss |
(27 |
) |
|
(18 |
) |
Net interest expense |
3 |
|
|
2 |
|
Depreciation and amortization |
15 |
|
|
15 |
|
Stock-based compensation |
18 |
|
|
18 |
|
Gain on extinguishment of notes |
(27 |
) |
|
(27 |
) |
Adjusted EBITDA |
(19 |
) |
|
(9 |
) |
Note: Figures may not sum due to rounding. |
|||||
View source version on businesswire.com: https://www.businesswire.com/news/home/20231102909304/en/