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Dec 31, 2023
Frontdoor Q4 2023 Earnings Report
Revenue increased, gross profit margin improved, and net income increased.
Key Takeaways
Frontdoor reported an 8% increase in revenue to $366 million and a net income of $9 million for Q4 2023. The gross profit margin increased by 570 basis points to 48%. Adjusted EBITDA increased by $12 million to $45 million.
Revenue increased 8% to $366 million.
Gross profit margin increased 570 basis points to 48%.
Net income was $9 million.
Adjusted EBITDA increased $12 million to $45 million.
Frontdoor
Frontdoor
Frontdoor Revenue by Segment
Revenue by Segment
Renewals Revenue
CapyFin.comOther Revenue
CapyFin.com Forward Guidance
Frontdoor anticipates revenue between $370 million and $380 million and Adjusted EBITDA between $40 million and $50 million for Q1 2024. For the full year 2024, Frontdoor projects revenue between $1.81 billion and $1.84 billion and Adjusted EBITDA between $350 million and $360 million.
Positive Outlook
- Mid-single digit increase in renewals channel revenue.
- Approximately 30% increase in other revenue, which is primarily driven by the new HVAC program.
- Targeting full year share repurchases of approximately $100 million.
- Gross profit margin of 48.5% to 49.5%.
- Annual effective tax rate of approximately 25%.
Challenges Ahead
- Approximately 10% decline in direct-to-consumer channel revenue.
- A 15% to 20% decline in real estate channel revenue.
- The number of home warranties is expected to decline 1% to 3%.
- SG&A of $580 million to $595 million, which is slightly higher than the prior year due to normal cost inflation in general and administrative expenses.
- Adjusted EBITDA of $40 million to $50 million, a decline from the prior-year period as a result of increased marketing investments to drive first-year direct-to-consumer customer count.
Revenue & Expenses
Visualization of income flow from segment revenue to net income