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Sep 30
Frontdoor Q3 2025 Earnings Report
Frontdoor posted strong third-quarter results with double-digit growth in revenue, net income, and adjusted EBITDA.
Key Takeaways
Frontdoor delivered a robust Q3 2025 performance, with revenue rising to $618 million and net income reaching $106 million. The company saw growth across all customer channels and improved its gross profit margin.
Revenue grew 14% year-over-year to $618 million, driven by volume and pricing gains.
Net income rose 5% to $106 million while adjusted EPS increased to $1.58.
Gross profit margin expanded by 60 basis points to 57%.
Customer retention rate improved to 79.4% and total home service plans increased 8% to 2.11 million.
Frontdoor
Frontdoor
Frontdoor Revenue by Segment
Revenue by Segment
Renewals Revenue
CapyFin.comReal Estate (First-Year) Revenue
CapyFin.comDirect-to-Consumer (First-Year) Revenue
CapyFin.comOther Revenue
CapyFin.com Forward Guidance
Frontdoor raised its full-year 2025 revenue and adjusted EBITDA guidance based on continued momentum from its 2-10 acquisition, improved customer metrics, and channel expansion.
Positive Outlook
- Full-year revenue outlook increased to $2.075B–$2.085B
- Adjusted EBITDA guidance raised to $545M–$550M
- Expected ~10% increase in renewal channel revenue
- Expected ~12% growth in real estate channel revenue
- Customer retention rate improved to 79.4%
Challenges Ahead
- Full-year home warranty member count expected to decline ~2%
- Gross profit margin expected to narrow to ~55.5%
- Increased SG&A costs to $670M–$675M
- Headwinds from inflation in contractor network and parts
- Ongoing integration costs from 2-10 acquisition
Revenue & Expenses
Visualization of income flow from segment revenue to net income