News Releases
Revenue increased 73% year-over-year to
Net loss was
Net loss per share, basic and diluted, was
"Real estate commerce has probably virtualized itself more in the past two months than it had in the prior 20 years," said Redfin CEO
First Quarter Highlights
- Reached market share of 0.93% of
U.S. existing home sales by value in the first quarter of 2020, an increase of 0.10 percentage points from the first quarter of 2019.(1) - Saved homebuyers and sellers over
$30 million in the first quarter of 2020. This includes the savings Redfin offers buyers through the Redfin Refund and sellers through Redfin's lower listing fee when compared to a 2.5% listing commission typically charged by traditional agents. - Launched Redfin Premier, a luxury service offering enhanced local and international marketing, as well as high-end photography and branding for million-dollar homes. The program was introduced in
Austin ,Boston ,Chicago ,Denver ,Hawaii ,Maryland ,Orange County ,Portland ,Sacramento ,San Diego andNorthern Virginia and will be expanded to other markets over time. - Expanded the brokerage's national footprint by launching agent service in
Flagstaff, AZ.
COVID-19 Actions
Redfin took swift action to respond to COVID-19 and prepare the business to weather the associated economic decline, while strengthening its long-term competitive advantage as the leading technology-powered residential real estate company:
- As soon as cases of COVID-19 were being reported in the
Seattle area, the company instituted new policies to safeguard the health of Redfin customers and employees. StartingMarch 4 , Redfin directed all employees in itsSeattle office to work from home and asked employees across all of its other offices to follow suit beginningMarch 5 . - Starting on
March 4 , Redfin began publishing weekly reports on the impact of COVID-19 on the housing market, real estate listing activity, sales and homebuyer demand, providing transparent information and the latest data to its agents and customers. - Established a company-wide COVID-19 response team to monitor all state and local government orders and provide real-time guidance to employees.
- Pivoted its strategic priorities and business operations, including temporarily pausing making offers for homes through RedfinNow and shifting engineering focus to building software for the virtual brokerage.
- Raised
$110 million through the sale of capital stock toDurable Capital Partners LP . - Rapidly expanded its virtual brokerage capabilities and software in response to health and safety concerns and stay at home orders. Specifically:
- Updated its website and mobile application to highlight virtual services and allow customers to request a live video chat tour with a Redfin agent with one click. The software also lets the customer select their preferred video chat application and provides market-specific messages and touring options based on local ordinances. For the week ended
May 2 , 27% of Redfin tour requests were for video tours. - Increased the prominence and visibility of 3D Virtual Walkthroughs on all Redfin listings.
- Encouraged customers to take advantage of the digital closing capabilities of Redfin Mortgage and Title Forward in markets where the law allows them.
- Cut executive compensation and bonuses, eliminated bonuses for headquarters employees and temporarily cut headquarters salaries between 10% and 15%.
- In April, reduced its number of employees by approximately 400 people, which represented approximately 10% of employees, and placed approximately an additional 1,000 employees on furlough.
- In response to strengthening homebuying demand in late April, began to unwind some of the actions taken in March and early April. RedfinNow will resume making offers on homes in select markets in May. The company also plans to resume television advertising with new ads in select markets, and in early May, asked approximately 135 employees to return from furlough to serve renewed homebuying demand.
(1) We calculate the aggregate value of
Business Outlook
The following forward-looking statements reflect Redfin's expectations as of
For the second quarter of 2020 we expect:
- Total revenue between
$179 million and$189 million , representing a year-over-year decrease between 9% and 4% compared to the second quarter of 2019. Properties segment revenue between$61 million and$65 million is included in the guidance provided. - Net loss between
$26 million and$21 million , compared to net loss of$13 million in the second quarter of 2019. This guidance includes approximately$7.0 million of expected stock-based compensation and$3.5 million of expected depreciation and amortization. The guidance also contains approximately$4.4 million of severance costs and$3.7 million of furlough costs, both including benefits.
Conference Call
Redfin will webcast a conference call to discuss the results at
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of federal securities laws, including our future operating results, as described under Business Outlook, and expansion of our Redfin Premiere service offering. We believe our expectations related to these forward-looking statements are reasonable, but actual results may turn out to be materially different. For factors that could cause actual results to differ materially from the forward-looking statements in this press release, please see the risks and uncertainties identified under the heading "Risk Factors" in our annual report for the year ended
About Redfin
Redfin (www.redfin.com) is a technology-powered residential real estate company. Founded by software engineers, we run the country's #1 most-visited brokerage website and offer a host of online tools to consumers, including the Redfin Estimate. We represent people buying and selling homes in over 90 markets in
Redfin may post updates about COVID-19's impact on the
Redfin-F
|
|||||||
Consolidated Statements of Comprehensive Loss |
|||||||
(in thousands, except share and per share amounts, unaudited) |
|||||||
Three Months Ended |
|||||||
2020 |
2019 |
||||||
Revenue |
|||||||
Service |
$ |
111,478 |
$ |
88,768 |
|||
Product |
79,517 |
21,373 |
|||||
Total revenue |
190,995 |
110,141 |
|||||
Cost of revenue(1) |
|||||||
Service |
98,368 |
84,395 |
|||||
Product |
79,748 |
22,993 |
|||||
Total cost of revenue |
178,116 |
107,388 |
|||||
Gross profit |
12,879 |
2,753 |
|||||
Operating expenses |
|||||||
Technology and development(1) |
20,274 |
15,556 |
|||||
Marketing(1) |
25,708 |
33,201 |
|||||
General and administrative(1) |
24,327 |
21,448 |
|||||
Total operating expenses |
70,309 |
70,205 |
|||||
Loss from operations |
(57,430) |
(67,452) |
|||||
Interest income |
1,103 |
2,316 |
|||||
Interest expense |
(2,444) |
(2,136) |
|||||
Other income (expense), net |
(1,346) |
92 |
|||||
Net loss |
$ |
(60,117) |
$ |
(67,180) |
|||
Net loss per share attributable to common stock—basic and diluted |
$ |
(0.64) |
$ |
(0.74) |
|||
Weighted average shares of common stock—basic and diluted |
93,442,706 |
90,610,416 |
|||||
Other comprehensive income |
|||||||
Net loss |
$ |
(60,117) |
$ |
(67,180) |
|||
Foreign currency translation adjustments |
(25) |
1 |
|||||
Unrealized gain on available-for-sale securities |
559 |
— |
|||||
Total comprehensive loss |
$ |
(59,583) |
$ |
(67,179) |
|||
(1) Includes stock-based compensation as follows: |
|||||||
Three Months Ended |
|||||||
2020 |
2019 |
||||||
Cost of revenue |
$ |
1,638 |
$ |
1,465 |
|||
Technology and development |
3,648 |
2,656 |
|||||
Marketing |
375 |
286 |
|||||
General and administrative |
1,550 |
1,999 |
|||||
Total |
$ |
7,211 |
$ |
6,406 |
|
|||||||
Consolidated Balance Sheets |
|||||||
(in thousands, except share and per share amounts, unaudited) |
|||||||
|
|
||||||
Assets |
|||||||
Current assets |
|||||||
Cash and cash equivalents |
$ |
213,940 |
$ |
234,679 |
|||
Restricted cash |
16,772 |
12,769 |
|||||
Short-term investments |
75,049 |
70,029 |
|||||
Accounts receivable, net |
21,821 |
19,223 |
|||||
Inventory |
70,649 |
74,590 |
|||||
Loans held for sale |
44,321 |
21,985 |
|||||
Prepaid expenses |
9,555 |
14,822 |
|||||
Other current assets |
5,243 |
3,496 |
|||||
Total current assets |
457,350 |
451,593 |
|||||
Property and equipment, net |
40,496 |
39,577 |
|||||
Right-of-use assets, net |
49,972 |
52,004 |
|||||
Long-term investments |
26,711 |
30,978 |
|||||
|
11,382 |
11,504 |
|||||
Other non-current assets |
8,923 |
10,557 |
|||||
Total assets |
$ |
594,834 |
$ |
596,213 |
|||
Liabilities and stockholders' equity |
|||||||
Current liabilities |
|||||||
Accounts payable |
$ |
2,909 |
$ |
2,122 |
|||
Accrued liabilities |
58,456 |
38,022 |
|||||
Other payables |
11,717 |
7,884 |
|||||
Warehouse credit facilities |
42,586 |
21,302 |
|||||
Secured revolving credit facility |
8,901 |
4,444 |
|||||
Current lease liabilities |
11,533 |
11,408 |
|||||
Total current liabilities |
136,102 |
85,182 |
|||||
Non-current lease liabilities |
57,254 |
59,869 |
|||||
Convertible senior notes, net |
121,292 |
119,716 |
|||||
Total liabilities |
314,648 |
264,767 |
|||||
Commitments and contingencies |
|||||||
Stockholders' equity |
|||||||
Common stock—par value |
94 |
93 |
|||||
Additional paid-in capital |
591,421 |
583,097 |
|||||
Accumulated other comprehensive income |
575 |
42 |
|||||
Accumulated deficit |
(311,904) |
(251,786) |
|||||
Total stockholders' equity |
280,186 |
331,446 |
|||||
Total liabilities and stockholders' equity |
$ |
594,834 |
$ |
596,213 |
|
|||||||
Consolidated Statements of Cash Flows |
|||||||
(in thousands, unaudited) |
|||||||
Three Months Ended |
|||||||
2020 |
2019 |
||||||
Operating Activities |
|||||||
Net loss |
$ |
(60,117) |
$ |
(67,180) |
|||
Adjustments to reconcile net loss to net cash used in operating activities: |
|||||||
Depreciation and amortization |
3,307 |
1,637 |
|||||
Stock-based compensation |
7,211 |
6,406 |
|||||
Amortization of debt discount and issuance costs |
1,730 |
1,507 |
|||||
Non-cash lease expense |
2,254 |
1,216 |
|||||
Impairment costs |
1,420 |
— |
|||||
Other |
(989) |
— |
|||||
Change in assets and liabilities: |
|||||||
Accounts receivable, net |
(2,598) |
(890) |
|||||
Inventory |
3,941 |
(15,612) |
|||||
Prepaid expenses and other assets |
3,409 |
1,441 |
|||||
Accounts payable |
514 |
14,848 |
|||||
Accrued liabilities and other payables |
20,626 |
21,764 |
|||||
Lease liabilities |
(2,693) |
(1,459) |
|||||
Origination of loans held for sale |
(132,697) |
(49,850) |
|||||
Proceeds from sale of loans originated as held for sale |
111,233 |
39,015 |
|||||
Net cash used in operating activities |
(43,449) |
(47,157) |
|||||
Investing activities |
|||||||
Purchases of property and equipment |
(3,406) |
(3,151) |
|||||
Purchases of investments |
(33,267) |
— |
|||||
Sales of investments |
31,608 |
— |
|||||
Maturities of investments |
1,597 |
— |
|||||
Net cash used in investing activities |
(3,468) |
(3,151) |
|||||
Financing activities |
|||||||
Proceeds from the issuance of shares resulting from employee equity plans |
4,103 |
3,732 |
|||||
Tax payments related to net share settlements on restricted stock units |
(3,307) |
(818) |
|||||
Borrowings from warehouse credit facilities |
131,310 |
48,557 |
|||||
Repayments to warehouse credit facilities |
(110,025) |
(38,097) |
|||||
Borrowings from secured revolving credit facility |
11,854 |
— |
|||||
Repayments to secured revolving credit facility |
(7,398) |
— |
|||||
Other payables—deposits held in escrow |
3,684 |
3,968 |
|||||
Principal payments for finance lease obligations |
(15) |
— |
|||||
Net cash provided by financing activities |
30,206 |
17,342 |
|||||
Effect of exchange rate changes on cash and cash equivalents |
(25) |
— |
|||||
Net change in cash, cash equivalents, and restricted cash |
(16,736) |
(32,966) |
|||||
Cash, cash equivalents, and restricted cash: |
|||||||
Beginning of period |
247,448 |
439,055 |
|||||
End of period |
$ |
230,712 |
$ |
406,089 |
|
|||||||||||||||||||||||||||||||||||
Supplemental Financial Information and Business Metrics |
|||||||||||||||||||||||||||||||||||
(unaudited) |
|||||||||||||||||||||||||||||||||||
Three Months Ended |
|||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||
Monthly average visitors (in thousands) |
35,519 |
30,595 |
35,633 |
36,557 |
31,107 |
25,212 |
29,236 |
28,777 |
25,820 |
||||||||||||||||||||||||||
Real estate services transactions |
|||||||||||||||||||||||||||||||||||
Brokerage |
10,751 |
13,122 |
16,098 |
15,580 |
8,435 |
9,822 |
12,876 |
12,971 |
7,285 |
||||||||||||||||||||||||||
Partner |
2,479 |
2,958 |
3,499 |
3,357 |
2,125 |
2,749 |
3,333 |
3,289 |
2,237 |
||||||||||||||||||||||||||
Total |
13,230 |
16,080 |
19,597 |
18,937 |
10,560 |
12,571 |
16,209 |
16,260 |
9,522 |
||||||||||||||||||||||||||
Real estate services revenue per transaction |
|||||||||||||||||||||||||||||||||||
Brokerage |
$ |
9,520 |
$ |
9,425 |
$ |
9,075 |
$ |
9,332 |
$ |
9,640 |
$ |
9,569 |
$ |
9,227 |
$ |
9,510 |
$ |
9,628 |
|||||||||||||||||
Partner |
2,535 |
2,369 |
2,295 |
2,218 |
2,153 |
2,232 |
2,237 |
2,281 |
2,137 |
||||||||||||||||||||||||||
Aggregate |
8,211 |
8,127 |
7,865 |
8,071 |
8,134 |
7,964 |
7,790 |
8,048 |
7,869 |
||||||||||||||||||||||||||
Aggregate home value of real estate services transactions (in millions) |
$ |
6,098 |
$ |
7,588 |
$ |
9,157 |
$ |
8,986 |
$ |
4,800 |
$ |
5,825 |
$ |
7,653 |
$ |
7,910 |
$ |
4,424 |
|||||||||||||||||
U.S. market share by value |
0.93 |
% |
0.94 |
% |
0.96 |
% |
0.94 |
% |
0.83 |
% |
0.81 |
% |
0.85 |
% |
0.83 |
% |
0.73 |
% |
|||||||||||||||||
Revenue from top-10 Redfin markets as a percentage of real estate services revenue |
61 |
% |
62 |
% |
63 |
% |
64 |
% |
64 |
% |
66 |
% |
66 |
% |
68 |
% |
66 |
% |
|||||||||||||||||
Average number of lead agents |
1,826 |
1,526 |
1,579 |
1,603 |
1,503 |
1,419 |
1,397 |
1,415 |
1,327 |
|
|||||||
Supplemental Financial Information |
|||||||
(unaudited, in thousands) |
|||||||
Three Months Ended |
|||||||
2020 |
2019 |
||||||
Real estate services revenue |
|||||||
Brokerage revenue |
$ |
102,351 |
$ |
81,314 |
|||
Partner revenue |
6,285 |
4,576 |
|||||
Total real estate services revenue |
108,636 |
85,890 |
|||||
Properties revenue |
79,098 |
21,373 |
|||||
Other revenue |
4,250 |
3,047 |
|||||
Intercompany eliminations |
(989) |
(169) |
|||||
Total revenue |
$ |
190,995 |
$ |
110,141 |
|||
Cost of revenue |
|||||||
Real estate services |
$ |
93,562 |
$ |
80,784 |
|||
Properties |
79,299 |
22,993 |
|||||
Other |
6,244 |
3,780 |
|||||
Intercompany eliminations |
(989) |
(169) |
|||||
Total cost of revenue |
$ |
178,116 |
$ |
107,388 |
|||
Gross profit by segment |
|||||||
Real estate services |
$ |
15,074 |
$ |
5,106 |
|||
Properties |
(201) |
(1,620) |
|||||
Other |
(1,994) |
(733) |
|||||
Total gross profit |
$ |
12,879 |
$ |
2,753 |
|||
Gross margin (percentage of revenue) |
|||||||
Real estate services |
13.9 |
% |
5.9 |
% |
|||
Properties |
(0.3) |
(7.6) |
|||||
Other |
(46.9) |
(24.1) |
|||||
Total gross margin |
6.7 |
2.5 |
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SOURCE Redfin
Investor Relations, Elena Perron, 206-576-8610, ir@redfin.com, or Public Relations, Mariam Sughayer, 206-876-1322, press@redfin.com