NASDAQ$FTDR
Frontdoor Inc. · Q2 2022 earnings
Q2 2022 earnings · · Investor relations
Briefing
Frontdoor's financial performance was impacted by claims cost inflation and a challenging real estate market.
Frontdoor reported a 5% increase in revenue to $487 million in Q2 2022. Net income was $33 million, and Adjusted EBITDA was $77 million. The company's outlook reflects a challenging macroeconomic environment and claims cost inflation.
- Revenue increased 5% to $487 million, driven by double-digit growth in renewal and direct-to-consumer channels, offset by a 26% decline in real estate channel revenue.
- Gross profit margin was 43%, reflecting a 23% increase in the cost per service request due to macroeconomic factors and contractor-related inflation.
- Net income was $33 million.
- Adjusted EBITDA was $77 million.
Headline financials
Revenue & EPS history
Frontdoor · Revenue · Quarterly
$487M
Revenue by segment
Frontdoor · $365M total across 2 segments · Q2 2022
- Renewals$347M+9.8%95.1%
- Non-warranty and other$18M+38.5%4.9%
Forward guidance
Frontdoor updated its full-year 2022 outlook, with revenue expected to be in the range of $1.63 billion to $1.65 billion and gross margin in the range of 41% to 42%.
Tailwinds
- Revenue of $470 million to $480 million, reflecting an increase in direct-to-consumer and renewal revenue versus the prior year period that is partly offset by a decline in the real estate channel revenue.
- Upper-single digit revenue growth in the direct-to-consumer and renewal channels
- SG&A range updated to $525 million to $535 million. This is a $30 million reduction from the original 2022 outlook as a result of meaningful cost reductions across the business.
- Capital expenditures of $35 million to $45 million, primarily consisting of technology investments.
- Annual effective tax rate of approximately 23 percent.
Headwinds
- Gross profit margin range updated to 41 percent to 42 percent, driven primarily by the deteriorating macroeconomic conditions and the acceleration of inflationary cost pressures, that is partly offset by higher pricing and process improvement efforts.
- Adjusted EBITDA of $65 million to $75 million, a decline from the prior year period as a result of the accelerating inflationary cost trends and the impact of lower real estate channel revenue.
- A nearly 30 percent decline in real estate channel revenue
- The consolidated revenue growth for the home service plan business is anticipated to be in the low single digits.
- Revenue growth is mostly driven by higher price and product mix while customer growth is expected to decline approximately five percent.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 20 quarterly earnings reports · overlaid with Q2 2022
+1.5%
Avg return
Earnings day
+1.6%
Avg return
5 days after
-0.1%
Avg return
30 days after
59%
20 / 34 earnings
Positive
+25.0%
Q1 2025
Best reaction
-34.2%
Q4 2017
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q1 2026 | +13.3% | +8.8% | +2.3% | |
| Q4 2025 | +16.9% | +22.8% | -4.7% | |
| Q3 2025 | -15.8% | -24.1% | -19.3% | |
| Q2 2025 | -4.0% | -6.2% | +8.2% | |
| Q1 2025 | +25.0% | +30.0% | +33.8% | |
| Q4 2024 | -19.2% | -26.4% | -33.5% | |
| Q3 2024 | +10.7% | +17.9% | +19.9% | |
| Q1 2024 | +12.6% | +16.8% | +15.0% | |
| Q4 2023 | -5.1% | -6.8% | -1.4% | |
| Q3 2023 | +13.4% | +21.2% | +19.5% | |
| Q2 2023 | +5.6% | +4.6% | -4.8% | |
| Q1 2023 | +11.7% | +15.1% | +19.5% | |
| Q4 2022 | +4.3% | +1.6% | -1.3% | |
| Q3 2022 | +12.9% | +12.2% | +12.8% | |
| Q2 2022 | -0.9% | -5.4% | -12.5% | |
| Q1 2022 | -12.9% | -14.3% | -21.4% | |
| Q4 2021 | -6.6% | -8.1% | -11.9% | |
| Q3 2021 | -11.8% | -6.7% | -16.5% | |
| Q2 2021 | -13.8% | -14.7% | -14.2% | |
| Q1 2021 | +2.0% | +1.6% | +1.0% | |
| Q4 2020 | -1.3% | -3.9% | -0.2% | |
| Q3 2020 | +4.0% | +9.0% | +9.1% | |
| Q2 2020 | +7.0% | +3.8% | +0.1% | |
| Q1 2020 | +5.5% | +6.2% | +12.5% | |
| Q4 2019 | -2.1% | +0.9% | -20.1% | |
| Q3 2019 | -5.3% | -4.7% | -3.9% | |
| Q2 2019 | +16.5% | +14.9% | +17.5% | |
| Q1 2018 | +0.2% | -0.7% | +4.0% | |
| Q1 2019 | +11.9% | +12.0% | +17.6% | |
| Q4 2016 | +12.7% | +13.0% | +8.9% | |
| Q2 2018 | +12.7% | +13.0% | +8.9% | |
| Q4 2018 | +13.6% | +25.2% | +22.2% | |
| Q4 2017 | -34.2% | -36.6% | -35.4% | |
| Q3 2018 | -29.0% | -36.4% | -36.0% |
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