Group 1 - The Motley Fool is a financial services company founded in 1993, aiming to make the world smarter, happier, and richer [1] - The company reaches millions of people monthly through various channels including premium investing solutions, free guidance, market analysis, personal finance education, and podcasts [1] - The Motley Fool also operates a non-profit organization, The Motley Fool Foundation, contributing to its mission [1]

Core Insights - The real estate technology company Redfin has reported weak third-quarter earnings, primarily attributed to the challenging real estate market rather than any internal issues [1] Company Performance - Redfin's recent earnings report indicates that the company's performance is suffering due to external market conditions [1] - A specific number in the earnings report raises concerns, suggesting potential underlying issues that may need to be addressed [1]

Core Viewpoint - Redfin Corp (NASDAQ:RDFN) has experienced a significant decline of over 22% since the beginning of November, primarily due to a downgrade from Goldman Sachs and ongoing challenges in the real estate market [1][2]. Group 1: Stock Performance - RDFN is currently down 4.7% at $7.98 following a downgrade to "sell" from "neutral" by Goldman Sachs, citing issues such as home affordability and industry competition [1]. - The stock is on track for its fifth consecutive drop, with a total decline of 22.8% since the start of November, falling below its year-to-date breakeven level [2]. - The $8 price level, which previously acted as a ceiling from May to July, may now serve as a support level for the stock [2]. Group 2: Market Sentiment and Options Trading - Despite a 36% quarterly loss, options traders are showing interest in calls, with 23,188 calls purchased compared to 4,953 puts in the past two weeks on major exchanges [3]. - The Schaeffer's Volatility Index (SVI) for Redfin stock is at 81%, indicating low volatility expectations among options traders, ranking in the low 17th percentile of its annual range [4].

Core Insights - Redfin missed profit and sales estimates, leading to a decline in its U.S. market share [1] - The company reduced its full-year adjusted EBITDA guidance significantly [1] Financial Performance - Redfin reported a third-quarter loss of $33.8 million, or $0.28 per share, compared to a loss of $19 million, or $0.17 per share a year ago [1] - Revenue increased by 3.4% to $278 million, but this was below expectations [1] - Adjusted EBITDA fell to $3.9 million from $7.7 million in 2023, a reduction of nearly 50% [1] Market Share and Sales - Redfin's market share of U.S. existing home sales by units decreased to 0.76% from 0.78% a year ago [1] - CEO Glenn Kelman indicated that August and September sales were $7 million below expectations [1] Guidance and Costs - The company revised its full-year adjusted EBITDA loss forecast to between $15 million and $22 million, down from a previous expectation of breakeven [1] - Redfin incurred unexpected costs of $2 million related to changes in agent compensation and an additional $1 million for integrating its rental property program [1]

Redfin Corporation (NASDAQ:RDFN) Q3 2024 Earnings Conference Call November 7, 2024 4:30 PM ET Company Participants Meg Nunnally - Head, IR Glenn Kelman - CEO Chris Nielsen - CFO Conference Call Participants Ygal Arounian - Citi Curtis Nagle - Bank of America John Campbell - Stephens Jay McCanless - Wedbush Operator Good day, ladies and gentlemen and welcome to the Redfin Corporation Quarter Three 2024 Earnings Conference Call. All lines have been placed on a listen-only mode and the floor will be open for q ...

For the quarter ended September 2024, Redfin (RDFN) reported revenue of $278.02 million, up 3.4% over the same period last year. EPS came in at -$0.28, compared to -$0.17 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $280.21 million, representing a surprise of -0.78%. The company delivered an EPS surprise of -40.00%, with the consensus EPS estimate being -$0.20.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and h ...

Redfin (RDFN) came out with a quarterly loss of $0.28 per share versus the Zacks Consensus Estimate of a loss of $0.20. This compares to loss of $0.17 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -40%. A quarter ago, it was expected that this real estate broker would post a loss of $0.27 per share when it actually produced a loss of $0.23, delivering a surprise of 14.81%.Over the last four quarters, the company has surpasse ...

Employee and Operational Changes - The company reduced its total number of employees by 40% from April 2022 to December 2023, including a 40% reduction in lead agents, to align operations with consumer demand [149]. - The company completed the wind-down of its properties segment, including RedfinNow, in the second quarter of 2023, focusing resources on its core business [150]. Website and Market Performance - Monthly average visitors to the company's website and mobile application were 49,413 thousand in September 2024, a decrease from 51,619 thousand in June 2024 [158]. - Real estate services transactions totaled 16,764 in September 2024, down from 17,573 in June 2024 [158]. - The average revenue per brokerage transaction was $12,363 in September 2024, compared to $12,545 in June 2024 [158]. - The company's U.S. market share by units was 0.76% in September 2024, slightly down from 0.77% in June 2024 [158]. - Revenue from the top-10 Redfin markets accounted for 56% of real estate services revenue in September 2024, consistent with June 2024 [158]. Financial Performance - Revenue for Q3 2024 reached $278.015 million, a 3.9% increase from $268.956 million in Q3 2023 [193]. - Gross profit for Q3 2024 was $101.863 million, compared to $98.340 million in Q3 2023, resulting in a gross margin of 36.6% [193]. - Operating expenses totaled $128.815 million in Q3 2024, up from $123.867 million in Q3 2023, with technology and development expenses at $40.332 million [193]. - Net loss from continuing operations for Q3 2024 was $33.782 million, compared to a loss of $18.972 million in Q3 2023 [193]. - Total revenue for the three months ended September 30, 2024, increased by $9.1 million, or 3%, compared to the same period in 2023, primarily driven by a $4.7 million increase in other segment revenue and a $4.3 million increase in rentals revenue [196]. - Total gross profit for the three months ended September 30, 2024, was $101.9 million, representing an increase of $3.5 million, or 4%, compared to the same period in 2023 [214]. - Total revenue for the nine months ended September 30, 2024, increased by $40.1 million, or 5%, to $798.7 million compared to $758.6 million in the same period in 2023 [212]. Cost and Expense Management - Total cost of revenue increased by $5.5 million, or 3%, compared to the same period in 2023, mainly due to a $5.0 million increase in personnel costs and transaction bonuses [198]. - Operating expenses decreased by $23.1 million, or 5%, to $407.4 million, with significant reductions in technology and development expenses by $10.2 million (7%) and marketing expenses by $5.2 million (5%) [220]. - Interest expense increased significantly to $8.537 million in Q3 2024 from $1.603 million in Q3 2023 [193]. - General and administrative expenses increased by $3.4 million, or 6%, compared to the same period in 2023, mainly due to higher legal settlements and services expenses [206]. Mortgage and Interest Rates - Mortgage originations by dollars were $1,214 million in September 2024, down from $1,338 million in June 2024 [158]. - Mortgage originations are influenced by interest rates and customer demand, impacting the growth of the mortgage business [176]. - A hypothetical 10% change in interest rates would not have a material impact on the company's financial results for the fourth quarter of 2024 [274]. Adjusted EBITDA and Non-GAAP Measures - Adjusted EBITDA is presented as a non-GAAP financial measure to enhance comparability of financial statements and provide insight into underlying business trends [228]. - Adjusted EBITDA for the three months ended September 30, 2024, was $3,948 thousand, down from $7,651 thousand in the same period of 2023, a decrease of approximately 48.3% [231][234]. Cash Flow and Financing Activities - Cash and cash equivalents as of September 30, 2024, were $165.7 million, providing liquidity for operational needs [242]. - Net cash used in operating activities for the nine months ended September 30, 2024, was $(96.0) million, primarily due to the net loss [252]. - Net cash provided by investing activities was $36.6 million for the nine months ended September 30, 2024, mainly from sales of U.S. government securities [255]. - The company repurchased $5.0 million principal amount of 2025 convertible notes and $71.9 million principal amount of 2027 convertible notes for a total repurchase price of $57.1 million [270]. Impairment and Risk Management - Goodwill impairment testing indicated that the estimated fair values of all reporting units substantially exceeded their carrying values, with no impairment charges recorded [268]. - The company does not currently face significant foreign currency exchange rate risk due to limited operations in Canada [276]. - The company manages interest rate risk through forward sales commitments related to mortgage loans held for sale [275].

REDFIN Redfin Reports Third Quarter 2024 Financial Results SEATTLE - November 7, 2024 - Redfin Corporation (NASDAQ: RDFN) today announced results for its third quarter ended September 30, 2024. Third Quarter 2024 Third quarter revenue was $278.0 million, an increase of 3% compared to the third quarter of 2023. Gross profit was $101.9 million, an increase of 4% year-over-year. Real estate services gross profit was $48.7 million, a decrease of 10% year-over-year, and real estate services gross margin was 28%, ...

Core Viewpoint - Redfin (RDFN) is expected to report a quarterly loss of $0.20 per share, a decline of 17.7% year-over-year, with revenues projected at $280.21 million, reflecting a 4.2% increase compared to the previous year [1] Group 1: Earnings Estimates - Analysts predict a quarterly loss of $0.20 per share for Redfin, indicating a 17.7% decline from the same period last year [1] - The consensus EPS estimate has remained unchanged over the last 30 days, suggesting a reevaluation of initial estimates by analysts [1] Group 2: Revenue Estimates - The consensus estimate for 'Revenue- Real estate services' is $177.07 million, showing a -0.4% change from the prior-year quarter [4] - 'Revenue- Rentals' is expected to be $50.75 million, indicating a year-over-year increase of 7% [4] - 'Revenue- Partner revenue' is projected at $9.65 million, reflecting a -17.1% change year-over-year [4] - 'Revenue- Brokerage revenue' is estimated to reach $166.96 million, a +0.5% change from the year-ago quarter [5] Group 3: Transaction Estimates - Total 'Real estate services transactions' are expected to be 17.03 million, down from 17.43 million in the previous year [5] - 'Real estate services transactions - Partner' are projected at 3.67 million, compared to 4.35 million last year [6] - 'Real estate services transactions - Brokerage' should arrive at 13.3 million, slightly up from 13.08 million in the same quarter last year [8] Group 4: Key Metrics - The average number of lead agents is expected to be 1,717, down from 1,744 in the same quarter last year [6] - 'Real estate services revenue per transaction - Aggregate' is estimated at $10.46 million, compared to $10.20 million last year [7] - 'Monthly average visitors' are projected at 54.15 million, an increase from 51.31 million in the previous year [7] - 'Real estate services revenue per transaction - Partner' is expected to be $2.67 million, slightly down from $2.68 million last year [8] - 'Real estate services revenue per transaction - Brokerage' is forecasted to reach $12.61 million, compared to $12.70 million last year [9] Group 5: Market Performance - Redfin shares have shown a return of +7.3% over the past month, outperforming the Zacks S&P 500 composite's +0.7% change [9] - With a Zacks Rank 2 (Buy), Redfin is expected to outperform the overall market in the near future [9]