Frontdoor Delivers Exceptional Third-Quarter 2025 Financial Results
Revenue Increased
Gross Profit Margin Increased 60 Basis Points to
Net Income Increased
Adjusted EBITDA(1) Increased
Repurchased
Increasing Full Year Revenue and Adjusted EBITDA Guidance
Financial Results |
|
|||||||||||
|
|
Three Months Ended |
|
|||||||||
|
|
September 30, |
|
|||||||||
(In millions except as noted) |
|
2025 |
|
|
2024 |
|
|
Change |
|
|||
Revenue |
|
$ |
618 |
|
|
$ |
540 |
|
|
|
14 |
% |
Gross Profit |
|
|
353 |
|
|
|
306 |
|
|
|
16 |
% |
Net Income |
|
|
106 |
|
|
|
100 |
|
|
|
5 |
% |
Diluted Earnings per Share |
|
|
1.42 |
|
|
|
1.30 |
|
|
|
9 |
% |
Adjusted Net Income(1) |
|
|
117 |
|
|
|
106 |
|
|
|
11 |
% |
Adjusted Diluted Earnings per Share(1) |
|
|
1.58 |
|
|
|
1.38 |
|
|
|
15 |
% |
Adjusted EBITDA(1) |
|
|
195 |
|
|
|
165 |
|
|
|
18 |
% |
Home Warranties (number in millions) |
|
|
2.11 |
|
|
|
1.95 |
|
|
|
8 |
% |
Third-Quarter 2025 Summary
-
Revenue increased
14% to$618 million 3% increase from price and a12% increase from higher volume primarily driven by the 2-10 acquisition - Gross profit margin increased 60 basis points
-
Net Income and Diluted Earnings Per Share increased
5% to$106 million 9% to$1.42 -
Adjusted EBITDA(1) increased
18% to$195 million -
Share repurchases totaled
$215 million
Updated Full-Year 2025 Outlook
-
Increasing revenue to
$2.07 5 billion$2.08 5 billion -
Increasing Adjusted EBITDA(2) to
$545 million $550 million
“Frontdoor is on pace for another year of record financial performance," said Chairman and Chief Executive Officer Bill Cobb. “Our results are driven by contributions from the 2-10 acquisition and our continuous improvement in execution across the business. Real estate member count increased sequentially for the first time in five years, and our non-warranty business continues to demonstrate robust momentum. We have an extremely attractive business model that generates a tremendous amount of cash, which has us on track to repurchase up to
"We delivered exceptional financial performance in the third-quarter with double digit increases in revenue and Adjusted EBITDA," said Chief Financial Officer Jessica Ross. “Gross profit margin grew 60 basis points to
Third-Quarter 2025 Results
Revenue by Customer Channel |
|
|||||||||||
|
|
Three Months Ended |
|
|||||||||
|
|
September 30, |
|
|||||||||
(In millions) |
|
2025 |
|
|
2024 |
|
|
Change |
|
|||
Renewals |
|
$ |
461 |
|
|
$ |
422 |
|
|
|
9 |
% |
Real estate (First-Year) |
|
|
43 |
|
|
|
36 |
|
|
|
21 |
% |
Direct-to-consumer (First-Year) |
|
|
54 |
|
|
|
49 |
|
|
|
11 |
% |
Other |
|
|
59 |
|
|
|
34 |
|
|
|
73 |
% |
Total |
|
$ |
618 |
|
|
$ |
540 |
|
|
|
14 |
% |
Revenue increased
-
Renewal revenue increased
9% due to the impact of the 2-10 acquisition and higher price realization, partially offset by lower organic volume; -
Real estate revenue increased
21% primarily due to the impact of the 2-10 acquisition; -
Direct-to-consumer revenue increased
11% due to higher organic volume and the impact of the 2-10 acquisition, partially offset by lower price from our promotional strategy to drive new home warranty member growth; and -
Other revenue increased
73% due to the growth of the New HVAC and Moen Programs and the addition of New Home Structural Warranty revenue.
Period-over-Period Net Income and Adjusted EBITDA(1) Bridge
(In millions) |
|
Net Income |
|
|
|
Adjusted EBITDA |
|
||||
Three Months Ended September 30, 2024 |
|
$ |
|
100 |
|
|
|
$ |
|
165 |
|
Impact of change in revenue |
|
|
|
47 |
|
|
|
|
|
47 |
|
Sales and marketing costs |
|
|
|
(4 |
) |
|
|
|
|
(4 |
) |
Customer service costs |
|
|
|
(4 |
) |
|
|
|
|
(4 |
) |
Stock-based compensation expense |
|
|
|
(2 |
) |
|
|
|
|
— |
|
Acquisition-related costs |
|
|
|
1 |
|
|
|
|
|
— |
|
Other general and administrative costs |
|
|
|
(11 |
) |
|
|
|
|
(11 |
) |
Depreciation and amortization expense |
|
|
|
(12 |
) |
|
|
|
|
— |
|
Restructuring charges |
|
|
|
3 |
|
|
|
|
|
— |
|
Interest expense |
|
|
|
(10 |
) |
|
|
|
|
— |
|
Interest and net investment income |
|
|
|
1 |
|
|
|
|
|
1 |
|
Provision for income taxes |
|
|
|
(3 |
) |
|
|
|
|
— |
|
Three Months Ended September 30, 2025 |
|
$ |
|
106 |
|
|
|
$ |
|
195 |
|
Third-quarter 2025 Net Income increased
-
$47 million -
Contract claims costs(4) were flat, excluding the impact of claims costs related to the change in revenue. Contract claims costs primarily reflects:
- Low-to-mid-single digit cost inflation across our contractor network, replacement parts and equipment;
-
A lower number of service requests per customer, primarily driven by
$6 million -
Favorable claims cost development of
$5 million $3 million
- Changes in sales and marketing, customer service costs, acquisition-related costs, other general and administrative costs, depreciation and amortization expense, and interest expense are primarily due to the 2-10 acquisition.
Cash Flow
|
|
Nine Months Ended |
|
|||||||
|
|
September 30, |
|
|||||||
(In millions) |
|
2025 |
|
|
2024 |
|
||||
Net cash provided from (used for): |
|
|
|
|
|
|
|
|
||
Operating activities |
|
$ |
|
315 |
|
|
$ |
|
212 |
|
Investing activities |
|
|
|
37 |
|
|
|
|
(31 |
) |
Financing activities |
|
|
|
(210 |
) |
|
|
|
(131 |
) |
Cash increase during the period |
|
$ |
|
142 |
|
|
$ |
|
50 |
|
Net cash provided from operating activities was
Net cash provided from investing activities was
Net cash used for financing activities was
Free Cash Flow(1) increased
Cash as of September 30, 2025 was
Fourth-Quarter 2025 Outlook
-
Revenue of
$415 million $425 million -
Adjusted EBITDA(2) of
$50 million $55 million
Updated Full-Year 2025 Outlook
-
Increasing revenue to
$2.07 5 billion$2.08 5 billion-
~
3% increase in realized price. -
~
10% increase in volume. -
~
10% increase in renewal channel revenue. -
~
3% increase in direct-to-consumer channel revenue. -
~
12% increase in real estate channel revenue. -
~ in other revenue, a$190 million ~ increase versus the prior year.$75 million -
Home warranty member count to decline ~
2% in 2025.
-
~
-
Narrowing gross profit margin to ~
55.5% . -
Increasing SG&A to
$670 million $675 million -
Increasing Adjusted EBITDA(2) to
$545 million $550 million -
Lowering capital expenditures to
~ .$30 million -
Annual effective tax rate of ~
25% .
Third-Quarter 2025 Earnings Conference Call
Frontdoor has scheduled a conference call today, November 5, 2025, at 7:30 a.m. Central time (8:30 a.m. Eastern time). During the call, management will discuss the company’s operational performance and financial results for third-quarter 2025 and respond to questions from the investment community. Participants can register for the conference call by clicking https://www.webcaster5.com/Webcast/Page/3067/53089. Once completed, each participant will receive access details via email. Additionally, the conference call will be available via webcast which will include a slide presentation highlighting the company’s results. To participate via webcast and view the presentation, visit https://investors.frontdoorhome.com.
The call will be available for replay for approximately 60 days. To access the replay of this call, please call 877-481-4010 and enter conference passcode 53089 (international participants: 919-882-2331, conference passcode 53089). To view a replay of the webcast, visit the company’s https://investors.frontdoorhome.com.
About Frontdoor, Inc.
Frontdoor is the industry leader in home warranties and new home structural warranties, and a leading provider of on-demand home repair and maintenance services. As the parent company of two leading brands – American Home Shield and 2-10 Home Buyers Warranty – totaling more than two million members – we bring over 50 years of experience in the home warranty category, a cultivated national network of independent service contractors, and a reputation for delivering quality service and product innovation. American Home Shield, the leader in home warranties, gives homeowners peace of mind, budget protection and convenience, covering up to 29 home systems and appliances from costly and unexpected breakdowns. 2-10 Home Buyers Warranty is the leader in new home structural warranties, providing home builders with coverage for structural failures. These two brands, together with Frontdoor’s cutting-edge non-warranty services, provide an unbeatable combination that meets the full suite of homeowner repair and maintenance needs. For more information about Frontdoor, Inc., please visit frontdoorhome.com.
Forward-Looking Statements
This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, in particular, projected future performance and any statements about Frontdoor’s plans, strategies and prospects. Forward-looking statements can be identified by the use of forward-looking terms such as “believe,” “expect,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek,” “anticipate,” “project,” “will,” “shall,” “would,” “aim,” or other comparable terms. These forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. Such risks and uncertainties include, but are not limited to: changes in macroeconomic conditions, including inflation, tariffs and global supply chain challenges and changing interest rates, especially as they may affect existing or new home sales, consumer confidence, labor availability or our costs; our ability to successfully implement our business strategies; the ability of our marketing efforts to be successful and cost-effective; our dependence on our first-year direct-to-consumer and real estate acquisition channels and our renewal channel; changes in the source and intensity of competition in our market, including risks related to the development, deployment, and use of artificial intelligence in our business and industry; our ability to attract, retain and maintain positive relations with third-party contractors and vendors; increases in parts, appliance and home system prices, and other operating costs; changes in
Non-GAAP Financial Measures
To supplement Frontdoor’s results presented in accordance with accounting principles generally accepted in
We define "Adjusted EBITDA" as net income before depreciation and amortization expense; goodwill and intangibles impairment; restructuring charges; acquisition-related costs; provision for income taxes; non-cash stock-based compensation expense; interest expense; loss on extinguishment of debt; and other non-operating expenses. We believe Adjusted EBITDA is useful for investors, analysts and other interested parties as it facilitates company-to-company operating performance comparisons by excluding potential differences caused by variations in capital structures, taxation, the age and book depreciation of facilities and equipment, restructuring and acquisition initiatives and equity-based, long-term incentive plans.
We define “Free Cash Flow” as net cash provided from operating activities less property additions. Free Cash Flow is not a measurement of our financial performance or liquidity under
We define “Adjusted Net Income” as net income before: amortization expense; restructuring charges; loss on extinguishment of debt; other non-operating expenses; and the tax impact of the aforementioned adjustments. We believe Adjusted Net Income is useful for investors, analysts and other interested parties as it facilitates company-to-company operating performance comparisons by excluding potential differences caused by items listed in this definition.
We define “Adjusted Diluted Earnings per Share” as Adjusted Net Income divided by the weighted-average diluted common shares outstanding.
We define “Unrestricted Cash” as cash not subject to third-party restrictions. For additional information related to our third-party restrictions, see “Liquidity and Capital Resources — Liquidity” under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2024 Annual Report on Form 10-K filed with the SEC.
See the schedules attached hereto for additional information and reconciliations of such non-GAAP financial measures. Management believes these non-GAAP financial measures provide useful supplemental information for its and investors’ evaluation of Frontdoor’s business performance and are useful for period-over-period comparisons of the performance of Frontdoor’s business. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with
© 2025 Frontdoor, Inc. All rights reserved. The following terms, which may be used in this press release, are trademarks of Frontdoor, Inc. and its subsidiaries: Frontdoor®, American Home Shield®, HSA™, OneGuard®, Landmark Home Warranty®, Streem®, 2-10 HBW®, and related logos and designs. All other trademarks used herein are the property of their respective owners.
(1) |
See “Reconciliations of Non-GAAP Financial Measures” accompanying this release for a reconciliation of Adjusted EBITDA, Free Cash Flow, Adjusted Net Income and Adjusted Diluted Earnings per Share, each a non-GAAP measure, to the nearest GAAP measure. See “Non-GAAP Financial Measures” included in this release for descriptions of calculations of these measures. Amounts presented in the reconciliations and other tables presented herein may not sum due to rounding. |
|
(2) |
A reconciliation of the forward-looking Adjusted EBITDA outlook to net income cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted. For the same reasons, the company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results. |
|
(3) |
Revenue conversion includes the impact of the change in the number of home warranties as well as the impact of year-over-year price changes. The impact of the change in the number of home warranties considers the associated revenue on those plans less an estimate of contract claims costs based on margin experience in the prior year period. |
|
(4) |
Contract claims costs includes the impact of changes in service request incidence, inflation and other drivers associated with the number of home warranties in the prior year period. The impact on contract claims costs resulting from year-over-year changes in the number of home warranties is included in revenue conversion above. |
Frontdoor, Inc.
Consolidated Statements of Operations and Comprehensive Income (Unaudited)
(In millions, except per share data)
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||||||
|
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||||||
Revenue |
|
$ |
|
618 |
|
|
$ |
|
540 |
|
|
$ |
|
1,660 |
|
|
$ |
|
1,461 |
|
Cost of services rendered |
|
|
|
264 |
|
|
|
|
235 |
|
|
|
|
716 |
|
|
|
|
655 |
|
Gross Profit |
|
|
|
353 |
|
|
|
|
306 |
|
|
|
|
944 |
|
|
|
|
806 |
|
Selling and administrative expenses |
|
|
|
174 |
|
|
|
|
154 |
|
|
|
|
498 |
|
|
|
|
456 |
|
Depreciation and amortization expense |
|
|
|
22 |
|
|
|
|
10 |
|
|
|
|
66 |
|
|
|
|
28 |
|
Restructuring charges |
|
|
|
1 |
|
|
|
|
3 |
|
|
|
|
1 |
|
|
|
|
5 |
|
Interest expense |
|
|
|
20 |
|
|
|
|
10 |
|
|
|
|
59 |
|
|
|
|
29 |
|
Interest and net investment income |
|
|
|
(6 |
) |
|
|
|
(5 |
) |
|
|
|
(16 |
) |
|
|
|
(15 |
) |
Income before Income Taxes |
|
|
|
142 |
|
|
|
|
134 |
|
|
|
|
336 |
|
|
|
|
303 |
|
Provision for income taxes |
|
|
|
37 |
|
|
|
|
34 |
|
|
|
|
83 |
|
|
|
|
77 |
|
Net Income |
|
$ |
|
106 |
|
|
$ |
|
100 |
|
|
$ |
|
253 |
|
|
$ |
|
226 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other Comprehensive Loss, Net of Income Taxes: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unrealized loss on derivative instruments, net of income taxes |
|
|
|
(1 |
) |
|
|
|
(4 |
) |
|
|
|
(13 |
) |
|
|
|
(3 |
) |
Total Other Comprehensive Loss, Net of Income Taxes |
|
|
|
(1 |
) |
|
|
|
(4 |
) |
|
|
|
(13 |
) |
|
|
|
(3 |
) |
Comprehensive Income |
|
$ |
|
105 |
|
|
$ |
|
97 |
|
|
$ |
|
240 |
|
|
$ |
|
223 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings per Share: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
|
1.45 |
|
|
$ |
|
1.32 |
|
|
$ |
|
3.44 |
|
|
$ |
|
2.92 |
|
Diluted |
|
$ |
|
1.42 |
|
|
$ |
|
1.30 |
|
|
$ |
|
3.38 |
|
|
$ |
|
2.90 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted-average Common Shares Outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
|
72.8 |
|
|
|
|
76.2 |
|
|
|
|
73.6 |
|
|
|
|
77.4 |
|
Diluted |
|
|
|
74.4 |
|
|
|
|
77.1 |
|
|
|
|
75.0 |
|
|
|
|
78.0 |
|
Frontdoor, Inc.
Condensed Consolidated Statements of Financial Position (Unaudited)
(In millions, except share data)
|
|
As of |
|
|||||||
|
|
September 30, |
|
|
December 31, |
|
||||
|
|
2025 |
|
|
2024 |
|
||||
Assets: |
|
|
|
|
|
|
|
|
||
Current Assets: |
|
|
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
|
563 |
|
|
$ |
|
421 |
|
Marketable securities |
|
|
|
— |
|
|
|
|
15 |
|
Receivables, less allowance of |
|
|
|
10 |
|
|
|
|
10 |
|
Prepaid expenses and other current assets |
|
|
|
39 |
|
|
|
|
42 |
|
Contract assets |
|
|
|
77 |
|
|
|
|
— |
|
Assets held for sale |
|
|
|
5 |
|
|
|
|
— |
|
Total Current Assets |
|
|
|
695 |
|
|
|
|
488 |
|
Other Assets: |
|
|
|
|
|
|
|
|
||
Property and equipment, net |
|
|
|
59 |
|
|
|
|
73 |
|
Goodwill |
|
|
|
971 |
|
|
|
|
967 |
|
Intangible assets, net |
|
|
|
400 |
|
|
|
|
448 |
|
Operating lease right-of-use assets |
|
|
|
7 |
|
|
|
|
8 |
|
Long-term marketable securities |
|
|
|
— |
|
|
|
|
38 |
|
Deferred reinsurance |
|
|
|
68 |
|
|
|
|
65 |
|
Deferred customer acquisition costs |
|
|
|
13 |
|
|
|
|
11 |
|
Other assets |
|
|
|
15 |
|
|
|
|
11 |
|
Total Assets |
|
$ |
|
2,227 |
|
|
$ |
|
2,107 |
|
Liabilities and Shareholders' Equity: |
|
|
|
|
|
|
|
|
||
Current Liabilities: |
|
|
|
|
|
|
|
|
||
Accounts payable |
|
$ |
|
104 |
|
|
$ |
|
71 |
|
Accrued liabilities: |
|
|
|
|
|
|
|
|
||
Payroll and related expenses |
|
|
|
36 |
|
|
|
|
44 |
|
Home warranty claims |
|
|
|
71 |
|
|
|
|
74 |
|
Income taxes payable |
|
|
|
36 |
|
|
|
|
1 |
|
Other |
|
|
|
31 |
|
|
|
|
28 |
|
Deferred revenue |
|
|
|
94 |
|
|
|
|
123 |
|
Current portion of long-term debt |
|
|
|
29 |
|
|
|
|
29 |
|
Total Current Liabilities |
|
|
|
401 |
|
|
|
|
369 |
|
Long-Term Debt |
|
|
|
1,151 |
|
|
|
|
1,170 |
|
Other Long-Term Liabilities: |
|
|
|
|
|
|
|
|
||
Deferred tax liabilities, net |
|
|
|
52 |
|
|
|
|
49 |
|
Operating lease liabilities |
|
|
|
18 |
|
|
|
|
20 |
|
Unearned insurance premium |
|
|
|
238 |
|
|
|
|
233 |
|
Long-term deferred revenue |
|
|
|
20 |
|
|
|
|
12 |
|
Other long-term liabilities |
|
|
|
32 |
|
|
|
|
16 |
|
Total Other Long-Term Liabilities |
|
|
|
360 |
|
|
|
|
329 |
|
Commitments and Contingencies |
|
|
|
|
|
|
|
|
||
Shareholders' Equity: |
|
|
|
|
|
|
|
|
||
Common stock, |
|
|
|
1 |
|
|
|
|
1 |
|
Additional paid-in capital |
|
|
|
184 |
|
|
|
|
152 |
|
Retained earnings |
|
|
|
784 |
|
|
|
|
530 |
|
Accumulated other comprehensive loss |
|
|
|
(14 |
) |
|
|
|
— |
|
Less treasury stock, at cost; 15,956,609 shares as of September 30, 2025 and 12,120,225 shares as of December 31, 2024 |
|
|
|
(639 |
) |
|
|
|
(444 |
) |
Total Shareholders' Equity |
|
|
|
316 |
|
|
|
|
239 |
|
Total Liabilities and Shareholders' Equity |
|
$ |
|
2,227 |
|
|
$ |
|
2,107 |
|
Frontdoor, Inc.
Consolidated Statements of Cash Flows (Unaudited)
(In millions)
|
|
Nine Months Ended |
|
|||||||
|
|
September 30, |
|
|||||||
|
|
2025 |
|
|
2024 |
|
||||
Cash and Cash Equivalents at Beginning of Period |
|
$ |
|
421 |
|
|
$ |
|
325 |
|
Cash Flows from Operating Activities: |
|
|
|
|
|
|
|
|
||
Net Income |
|
|
|
253 |
|
|
|
|
226 |
|
Adjustments to reconcile net income to net cash provided from operating activities: |
|
|
|
|
|
|
|
|
||
Depreciation and amortization expense |
|
|
|
66 |
|
|
|
|
28 |
|
Deferred income tax benefit |
|
|
|
10 |
|
|
|
|
— |
|
Stock-based compensation expense |
|
|
|
25 |
|
|
|
|
20 |
|
Other |
|
|
|
1 |
|
|
|
|
2 |
|
Changes in: |
|
|
|
|
|
|
|
|
||
Prepaid expenses and other current assets |
|
|
|
(79 |
) |
|
|
|
(74 |
) |
Deferred reinsurance |
|
|
|
(4 |
) |
|
|
|
— |
|
Deferred customer acquisition costs |
|
|
|
(2 |
) |
|
|
|
— |
|
Accounts payable |
|
|
|
33 |
|
|
|
|
14 |
|
Deferred revenue |
|
|
|
(21 |
) |
|
|
|
(12 |
) |
Accrued liabilities |
|
|
|
(12 |
) |
|
|
|
(10 |
) |
Deferred insurance premiums |
|
|
|
7 |
|
|
|
|
— |
|
Current income taxes |
|
|
|
37 |
|
|
|
|
18 |
|
Net Cash Provided from Operating Activities |
|
|
|
315 |
|
|
|
|
212 |
|
Cash Flows from Investing Activities: |
|
|
|
|
|
|
|
|
||
Purchases of property and equipment |
|
|
|
(20 |
) |
|
|
|
(31 |
) |
Business acquisitions, net of cash acquired |
|
|
|
3 |
|
|
|
|
— |
|
Purchases of available-for-sale securities |
|
|
|
(6 |
) |
|
|
|
— |
|
Sales and maturities of available-for-sale securities |
|
|
|
60 |
|
|
|
|
— |
|
Net Cash Provided from (Used for) Investing Activities |
|
|
|
37 |
|
|
|
|
(31 |
) |
Cash Flows from Financing Activities: |
|
|
|
|
|
|
|
|
||
Repayments of debt |
|
|
|
(22 |
) |
|
|
|
(13 |
) |
Repurchases of common stock |
|
|
|
(195 |
) |
|
|
|
(120 |
) |
Other financing activities |
|
|
|
7 |
|
|
|
|
2 |
|
Net Cash Used for Financing Activities |
|
|
|
(210 |
) |
|
|
|
(131 |
) |
Cash Increase During the Period |
|
|
|
142 |
|
|
|
|
50 |
|
Cash and Cash Equivalents at End of Period |
|
$ |
|
563 |
|
|
$ |
|
375 |
|
Reconciliations of Non-GAAP Financial Measures
The following table presents reconciliations of Net Income to Adjusted Net Income.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||
(In millions, except per share amounts) |
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||
Net Income |
|
$ |
106 |
|
|
$ |
100 |
|
|
$ |
253 |
|
|
$ |
226 |
|
Amortization expense |
|
|
13 |
|
|
|
1 |
|
|
|
38 |
|
|
|
2 |
|
Acquisitions-related Costs |
|
|
2 |
|
|
|
3 |
|
|
|
6 |
|
|
|
9 |
|
Restructuring Charges |
|
|
1 |
|
|
|
3 |
|
|
|
1 |
|
|
|
5 |
|
Tax Impact of Adjustments |
|
|
(3 |
) |
|
|
(1 |
) |
|
|
(10 |
) |
|
|
(2 |
) |
Adjusted Net Income |
|
$ |
117 |
|
|
$ |
106 |
|
|
$ |
288 |
|
|
$ |
240 |
|
Adjusted Earnings per Share: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
1.61 |
|
|
$ |
1.39 |
|
|
$ |
3.91 |
|
|
$ |
3.11 |
|
Diluted |
|
$ |
1.58 |
|
|
$ |
1.38 |
|
|
$ |
3.84 |
|
|
$ |
3.08 |
|
Weighted-average Common Shares outstanding: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
72.8 |
|
|
|
76.2 |
|
|
|
73.6 |
|
|
|
77.4 |
|
Diluted |
|
|
74.4 |
|
|
|
77.1 |
|
|
|
75.0 |
|
|
|
78.0 |
|
The following table presents reconciliations of net cash provided from operating activities to Free Cash Flow.
|
|
Nine Months Ended |
|
|||||||
|
|
September 30, |
|
|||||||
(In millions) |
|
2025 |
|
|
2024 |
|
||||
Net cash provided from operating activities |
|
$ |
|
315 |
|
|
$ |
|
212 |
|
Property additions |
|
|
|
(20 |
) |
|
|
|
(31 |
) |
Free Cash Flow |
|
$ |
|
296 |
|
|
$ |
|
181 |
|
The following table presents reconciliations of Net Income to Adjusted EBITDA.
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
||||||||||||||
|
|
September 30, |
|
|
September 30, |
|
||||||||||||||
(In millions) |
|
2025 |
|
|
2024 |
|
|
2025 |
|
|
2024 |
|
||||||||
Net Income |
|
$ |
|
106 |
|
|
$ |
|
100 |
|
|
$ |
|
253 |
|
|
$ |
|
226 |
|
Depreciation and amortization expense |
|
|
|
22 |
|
|
|
|
10 |
|
|
|
|
66 |
|
|
|
|
28 |
|
Restructuring charges |
|
|
|
1 |
|
|
|
|
3 |
|
|
|
|
1 |
|
|
|
|
5 |
|
Acquisition-related costs |
|
|
|
2 |
|
|
|
|
3 |
|
|
|
|
6 |
|
|
|
|
9 |
|
Provision for income taxes |
|
|
|
37 |
|
|
|
|
34 |
|
|
|
|
83 |
|
|
|
|
77 |
|
Non-cash stock-based compensation expense |
|
|
|
8 |
|
|
|
|
6 |
|
|
|
|
25 |
|
|
|
|
20 |
|
Interest expense |
|
|
|
20 |
|
|
|
|
10 |
|
|
|
|
59 |
|
|
|
|
29 |
|
Other |
|
|
|
— |
|
|
|
|
— |
|
|
|
|
1 |
|
|
|
|
— |
|
Adjusted EBITDA |
|
$ |
|
195 |
|
|
$ |
|
165 |
|
|
$ |
|
494 |
|
|
$ |
|
394 |
|
Key Business Metrics
|
|
As of September 30, |
|
|
|||||
|
|
2025 |
|
|
2024 |
|
|
||
Number of home warranties (in millions) |
|
|
2.11 |
|
|
|
1.95 |
|
|
Renewals |
|
|
1.58 |
|
|
|
1.50 |
|
|
First-Year Direct-To-Consumer |
|
|
0.32 |
|
|
|
0.27 |
|
|
First-Year Real Estate |
|
|
0.21 |
|
|
|
0.18 |
|
|
Increase (Reduction) in number of home warranties(1) |
|
|
8 |
|
% |
|
(4 |
) |
% |
Customer retention rate(1) |
|
|
79.4 |
|
% |
|
77.7 |
|
% |
(1) |
Customer retention rate is presented on a rolling 12-month basis in order to avoid seasonal anomalies. As of September 30, 2025, excluding the 2-10 home warranties acquired on December 19, 2024, the reduction in home warranties was one percent, and the customer retention rate was 78.1 percent. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20251105000942/en/
For further information, contact:
Investor Relations:
Matt Davis
901.701.5199
ir@frontdoorhome.com
Media:
Alison Bishop
901.701.5198
mediacenter@frontdoorhome.com
Source: Frontdoor, Inc.
