Redfin (RDFN) reported $221.03 million in revenue for the quarter ended March 2025, representing a year-over-year decline of 2%. EPS of -$0.73 for the same period compares to -$0.57 a year ago.The reported revenue represents a surprise of +0.31% over the Zacks Consensus Estimate of $220.36 million. With the consensus EPS estimate being -$0.69, the EPS surprise was -5.80%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street ex ...

Core Viewpoint - Redfin reported a quarterly loss of $0.73 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.69, and a decline from a loss of $0.57 per share a year ago, indicating ongoing challenges in the real estate market [1] Financial Performance - The company posted revenues of $221.03 million for the quarter ended March 2025, slightly surpassing the Zacks Consensus Estimate by 0.31%, but down from $225.48 million in the same quarter last year [2] - Over the last four quarters, Redfin has exceeded consensus revenue estimates three times, but has only surpassed EPS estimates once [2] Stock Performance - Redfin shares have increased by approximately 17.2% since the beginning of the year, contrasting with a decline of -3.9% in the S&P 500 [3] - The stock's immediate price movement will largely depend on management's commentary during the earnings call [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.17 on revenues of $295.11 million, and for the current fiscal year, it is -$1.05 on revenues of $1.05 billion [7] - The estimate revisions trend for Redfin is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [6] Industry Context - The Real Estate - Operations industry, to which Redfin belongs, is currently ranked in the bottom 36% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which could impact Redfin's stock performance [5]

Visitor and Transaction Metrics - Monthly average visitors increased to 45,659 in Q1 2025, up from 42,680 in Q4 2024, reflecting a growth of approximately 4.6%[138] - Total real estate services transactions decreased to 12,255 in Q1 2025 from 14,363 in Q4 2024, representing a decline of about 14.7%[138] - The average number of lead agents increased to 2,190 in Q1 2025 from 1,927 in Q4 2024, showing a growth of approximately 13.6%[138] - U.S. market share by units was 0.75% in Q1 2025, up from 0.72% in Q4 2024, indicating a growth of about 4.2%[138] - Revenue from the top-10 markets accounted for 55% of total real estate services revenue in Q1 2025, consistent with Q4 2024[138] Revenue and Profitability - Total revenue for the three months ended March 31, 2025, was $221.027 million, a decrease of $4.452 million or 2% compared to $225.479 million in the same period in 2024[173] - Real estate services revenue decreased by $4.902 million or 4%, primarily due to a $5.591 million decrease in brokerage revenue, which was driven by a 2% decrease in brokerage transactions and a 3% decrease in revenue per transaction[175] - Rentals revenue increased by $2.770 million or 6%, while mortgage revenue decreased by $4.501 million or 13%[175] - Gross profit for the three months ended March 31, 2025, was $70.634 million, a slight decrease of $178, while gross margin increased to 32.0% from 31.4% in the same period in 2024[177][178] - Net loss for the three months ended March 31, 2025, was $92.519 million, compared to a net loss of $66.774 million in the same period in 2024, representing an increase in losses[173] Expenses and Cost Management - Operating expenses totaled $156.148 million, an increase of $16.079 million or 11.5% compared to $140.069 million in the same period in 2024[173] - Restructuring and reorganization expenses rose significantly to $20.930 million from $889 thousand in the prior year[173] - Interest expense increased to $7.784 million from $4.874 million, reflecting higher borrowing costs[173] - Total cost of revenue decreased by $4.274 million or 3%, primarily due to a $5.2 million decrease in home-touring and field expenses[177] - Marketing expenses increased by $14.4 million, or 58%, primarily due to a $16.1 million increase in marketing media costs[184] Restructuring and Future Costs - The company recorded $18.9 million in restructuring expenses related to the elimination of approximately 450 employee roles in Q1 2025[132] - The company expects additional restructuring costs between $3.0 million and $4.0 million to be recognized in Q2 2025[132] - Restructuring and reorganization expenses increased by $20.0 million, primarily due to the restructuring of the rentals segment related to the Partnership Agreement with Zillow[186] Cash Flow and Liquidity - Operating cash flows for the three months ended March 31, 2025, were $37.9 million, primarily driven by changes in assets and liabilities[209] - Cash and cash equivalents as of March 31, 2025, totaled $183.5 million[201] - The company expects existing cash and future operational cash flows to meet liquidity needs for at least the next twelve months[205] - Net cash used in investing activities was $3.2 million for the three months ended March 31, 2025, primarily for property and equipment purchases[211] - Net cash provided by financing activities was $24.1 million for the three months ended March 31, 2025, mainly due to a $23.6 million increase in net borrowings under warehouse credit facilities[214] Agreements and Partnerships - A Content License Agreement and Partnership Agreement with Zillow was entered into in February 2025, representing a significant transaction[222] - The upfront payment received under the Partnership Agreement is recognized as deferred revenue and will be recognized on a straight-line basis over the five-year contract term[224] Financial Position and Risks - The company had $576.9 million of convertible senior notes outstanding as of March 31, 2025, with maturities between October 2025 and April 2027[202] - The mortgage business has significant cash requirements due to the time lag between loan origination and sale[204] - The company is exposed to interest rate risk on its term loan, charged at SOFR +575 basis points for the first five full fiscal quarters after closing[233] - The company manages interest rate risk on mortgage loans through forward sales commitments, with changes in fair value recognized as revenue[234] - The investment policy focuses on liquidity and capital preservation, maintaining a portfolio of cash equivalents and investments in various securities[231] - The company does not currently face significant foreign currency exchange rate risk due to limited operations in Canada and minimal foreign currency balances[235] Goodwill and Impairment - Goodwill for the company represents the excess of the purchase price over the fair value of net tangible and identifiable intangible assets acquired, with no impairment charges recorded for the three months ended March 31, 2025 or 2024[227][228] - The fair value of the Rent. reporting unit exceeded its carrying value by approximately 20% based on the annual goodwill impairment test conducted in the fourth quarter of 2024[228]

Redfin Reports First Quarter 2025 Financial Results SEATTLE - May 6, 2025 - Redfin Corporation (NASDAQ: RDFN) today announced results for its first quarter ended March 31, 2025. First Quarter 2025 First quarter revenue was $221.0 million, a decrease of 2% compared to the first quarter of 2024. Gross profit was $70.6 million, flat year-over-year. Real estate services gross profit was $19.9 million, a decrease of 2% year-over-year, and real estate services gross margin was 16%, compared to 15% in the first qu ...

Core Viewpoint - Rocket Companies announced an agreement to acquire Redfin in an all-stock deal, potentially transforming Rocket into a comprehensive real estate player [1] Group 1: Acquisition Details - The acquisition involves Rocket Companies acquiring the tech-focused real estate brokerage Redfin [1] - The deal is structured as an all-stock transaction [1] Group 2: Market Implications - This acquisition could position Rocket Companies as a leading player in the real estate market by integrating mortgage services with real estate brokerage [1] - The move may enhance Rocket's competitive edge in the real estate sector [1]

JPMorgan's Dae K Lee is raising Redfin Corp‘s RDFN stock price target from $7 to $12.50, matching Rocket Companies' RKT acquisition price. The deal values Redfin's equity at about $1.75 billion, pegging it at two times its projected 2026 revenue.Yet, the market isn’t fully convinced, with Redfin stock trading approximately 12% below the offer price.Read Also: Warren Buffett’s Real Estate Brokerage, Compass Discuss DealRegulatory Hurdles? This Analyst Isn't Sweating It"We do not anticipate significant regula ...

Core Viewpoint - Redfin is being acquired by Rocket Companies, but Zillow may emerge as the primary beneficiary of this acquisition [1] Group 1: Acquisition Details - Redfin (RDFN) is being acquired by Rocket Companies (RKT) in a surprising buyout [1] - The deal may not be favorable for either Redfin or Rocket Companies [1] Group 2: Implications for Zillow - Zillow (Z) is positioned to benefit significantly from the acquisition of Redfin [1]

Core Viewpoint - Rowley Law PLLC is investigating potential securities law violations by Redfin and its board of directors regarding the proposed acquisition by Rocket Companies, which is valued at approximately $1.75 billion [1]. Group 1: Acquisition Details - Redfin stockholders will receive 0.7926 shares of Rocket Companies common stock for each share of Redfin stock they hold [1]. - The acquisition transaction is expected to close in the second or third quarter of 2025 [1]. Group 2: Legal Investigation - Rowley Law PLLC is representing shareholders in the investigation concerning the acquisition [1]. - Additional information regarding the investigation can be obtained by contacting Rowley Law PLLC [2].

SAN DIEGO, March 10, 2025 (GLOBE NEWSWIRE) -- Johnson Fistel, LLP has launched an investigation into whether the board members of Redfin Corporation (NASDAQ: RDFN) breached their fiduciary duties in connection with the proposed sale of the Company to Rocket Companies (NYSE: RKT). On March 10, 2025, Redfin announced that it had entered into a definitive merger agreement with Rocket Companies. Under the terms of the deal, Redfin shareholders will receive a fixed exchange ratio of 0.7926 shares of Rocket Compa ...

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...