NASDAQ$FTDR

Frontdoor Inc. · Q4 2020 earnings

Q4 2020 earnings · · Investor relations

Briefing

Frontdoor reported an 8% increase in revenue and a net income of $2 million for Q4 2020.

Frontdoor Inc. announced solid Q4 2020 results with an 8% increase in revenue to $323 million. However, net income decreased significantly to $2 million, and adjusted EBITDA fell by 33% to $32 million due to increased contract claims, sales and marketing, and customer service costs.

  • Revenue increased by 8% to $323 million.
  • Net income was $2 million, a decrease from $19 million in the prior year.
  • Adjusted EBITDA decreased by 33% to $32 million.
  • The company is focused on initiatives to drive double-digit revenue growth and improve customer retention.

Headline financials

Total Revenue

$323M

Previous: $300M+7.7%
EPS (adj)

$0.08

Previous: $0.25-68.0%
Home Warranties

2.3M

Previous: 2.2+102272627.3%
Capital Expenditures

$6M

Previous: $7M-14.3%
Free Cash Flow

$47M

Previous: $39M+20.5%
Net Income

$2M

Previous: $19M-89.5%
Operating Income

$1M

Previous: $23M-95.7%
Gross Profit

$137M

Previous: $139M-1.4%
Cash & Equivalents

$597M

Previous: $428M+39.5%
Total Assets

$1.41B

Previous: $1.25B+12.4%
Stock-Based Comp

$4M

Previous: $2M+100.0%

Revenue & EPS history

Frontdoor · Revenue · Quarterly

$323M

Q4 2020+7.7%vs Q4 2019
Beat estimate in 9 of 13 quarters(69%)
ActualEstimate

Revenue by segment

Frontdoor · $226M total across 2 segments · Q4 2020

  • Renewals
    $220M+7.8%
  • Non-warranty and other
    $6M+100.0%

Forward guidance

Frontdoor anticipates revenue between $1.63 billion and $1.65 billion for the full year 2021 and expects first-quarter revenue between $325 million and $330 million.

Tailwinds

  • Revenue of $1.63 billion to $1.65 billion for full-year 2021, approximately 11% to 12% higher than the prior year.
  • Gross profit margin of approximately 48% for full-year 2021.
  • Capital expenditures of $35 million to $45 million, primarily consisting of technology investments.
  • First-quarter 2021 revenue of $325 million to $330 million.
  • Adjusted EBITDA of $30 million to $35 million for first-quarter 2021.

Headwinds

  • Adjusted EBITDA of $280 million to $300 million for full-year 2021.
  • Gross profit margin reflects a continuation of higher appliance service requests into the first half of 2021.
  • Adjusted EBITDA reflects a continuation of higher service request demand.
  • Adjusted EBITDA reflects additional investments in automation.
  • The company anticipates higher inflation.

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 Q4 2020

Historical avgQ4 2020

+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

Earnings price reactions
QuarterReport dateReaction (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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