Redfin Corporation |
Delaware |
001-38160 | 74-3064240 | |||||||||||||||
(State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
|||||||||||||||
1099 Stewart Street |
Suite 600 | ||||||||||||||||
Seattle |
WA |
98101 |
|||||||||||||||
(Address of principal executive offices) |
(Zip Code) |
(206) | 576-8333 | ||||
Registrant's telephone number, including area code |
(Former name, former address and former fiscal year, if changed since last report) |
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||||
☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||||
☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||||
☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
Common Stock, $0.001 par value per share | RDFN | The Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). | ||||||||
Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | ☐ |
Exhibit Number |
Description |
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99.1 | |||||||||||
104 | Cover page interactive data file, submitted using inline XBRL |
Redfin Corporation | ||||||||||||||
(Registrant) | ||||||||||||||
Date: May 4, 2023 | /s/ Chris Nielsen | |||||||||||||
Chris Nielsen Chief Financial Officer |
March 31, 2023 | December 31, 2022 | ||||||||||
Assets | |||||||||||
Current assets | |||||||||||
Cash and cash equivalents | $ | 149,940 | $ | 239,840 | |||||||
Restricted cash | 2,416 | 2,406 | |||||||||
Short-term investments | 140,531 | 122,259 | |||||||||
Accounts receivable, net of allowances for credit losses of $2,277 and $2,019 | 48,142 | 54,880 | |||||||||
Inventory | 10,685 | 114,273 | |||||||||
Loans held for sale | 192,622 | 199,604 | |||||||||
Prepaid expenses | 33,784 | 34,506 | |||||||||
Other current assets | 14,918 | 8,690 | |||||||||
Total current assets | 593,038 | 776,458 | |||||||||
Property and equipment, net | 52,551 | 55,105 | |||||||||
Right-of-use assets, net | 38,932 | 42,032 | |||||||||
Mortgage servicing rights, at fair value | 35,061 | 36,261 | |||||||||
Long-term investments | 9,572 | 29,480 | |||||||||
Goodwill | 461,349 | 461,349 | |||||||||
Intangible assets, net | 152,525 | 162,272 | |||||||||
Other assets, noncurrent | 11,413 | 11,247 | |||||||||
Total assets | $ | 1,354,441 | $ | 1,574,204 | |||||||
Liabilities, mezzanine equity, and stockholders' equity | |||||||||||
Current liabilities | |||||||||||
Accounts payable | $ | 10,154 | $ | 11,819 | |||||||
Accrued and other liabilities | 92,275 | 109,743 | |||||||||
Warehouse credit facilities | 185,283 | 190,509 | |||||||||
Convertible senior notes, net | 23,468 | 23,431 | |||||||||
Lease liabilities | 18,015 | 19,137 | |||||||||
Total current liabilities | 329,195 | 354,639 | |||||||||
Lease liabilities, noncurrent | 35,757 | 37,298 | |||||||||
Convertible senior notes, net, noncurrent | 928,651 | 1,078,157 | |||||||||
Deferred tax liabilities | 249 | 243 | |||||||||
Total liabilities | 1,293,852 | 1,470,337 | |||||||||
Series A convertible preferred stock—par value $0.001 per share; 10,000,000 shares authorized; 40,000 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 39,925 | 39,914 | |||||||||
Stockholders’ equity |
|||||||||||
Common stock—par value $0.001 per share; 500,000,000 shares authorized; 110,526,884 and 109,696,178 shares issued and outstanding at March 31, 2023 and December 31, 2022, respectively | 110 | 110 | |||||||||
Additional paid-in capital | 775,094 | 757,951 | |||||||||
Accumulated other comprehensive loss | (435) | (801) | |||||||||
Accumulated deficit | (754,105) | (693,307) | |||||||||
Total stockholders’ equity | 20,664 | 63,953 | |||||||||
Total liabilities, mezzanine equity, and stockholders’ equity | $ | 1,354,441 | $ | 1,574,204 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Revenue | |||||||||||
Service | $ | 212,934 | $ | 217,593 | |||||||
Product | 112,727 | 379,753 | |||||||||
Total revenue | 325,661 | 597,346 | |||||||||
Cost of revenue(1) |
|||||||||||
Service | 154,796 | 165,809 | |||||||||
Product | 114,658 | 358,999 | |||||||||
Total cost of revenue | 269,454 | 524,808 | |||||||||
Gross profit | 56,207 | 72,538 | |||||||||
Operating expenses | |||||||||||
Technology and development(1) |
48,192 | 49,640 | |||||||||
Marketing(1) |
40,908 | 43,342 | |||||||||
General and administrative(1) |
69,962 | 58,966 | |||||||||
Restructuring and reorganization | 1,053 | 5,710 | |||||||||
Total operating expenses | 160,115 | 157,658 | |||||||||
Loss from operations | (103,908) | (85,120) | |||||||||
Interest income | 3,406 | 220 | |||||||||
Interest expense | (1,922) | (3,861) | |||||||||
Income tax expense | (410) | (134) | |||||||||
Gain on extinguishment of convertible senior notes | 42,270 | — | |||||||||
Other expense, net | (234) | (1,911) | |||||||||
Net loss | $ | (60,798) | $ | (90,806) | |||||||
Dividends on convertible preferred stock | (226) | (793) | |||||||||
Net loss attributable to common stock—basic and diluted | $ | (61,024) | $ | (91,599) | |||||||
Net loss per share attributable to common stock—basic and diluted | $ | (0.55) | $ | (0.86) | |||||||
Weighted-average shares to compute net loss per share attributable to common stock—basic and diluted | 110,103,598 | 106,664,140 | |||||||||
Net loss | $ | (60,798) | $ | (90,806) | |||||||
Other comprehensive (loss) income | |||||||||||
Foreign currency translation adjustments | 58 | 4 | |||||||||
Unrealized (loss) gain on available-for-sale debt securities | (424) | 561 | |||||||||
Comprehensive loss | $ | (61,164) | $ | (90,241) |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Cost of revenue | $ | 4,181 | $ | 3,377 | |||||||
Technology and development | 8,209 | 7,965 | |||||||||
Marketing | 1,263 | 1,072 | |||||||||
General and administrative | 5,375 | 4,374 | |||||||||
Total | $ | 19,028 | $ | 16,788 |
Three Months Ended March 31, | |||||||||||
2023 | 2022 | ||||||||||
Operating Activities | |||||||||||
Net loss |
$ | (60,798) | $ | (90,806) | |||||||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Depreciation and amortization | 17,013 | 14,813 | |||||||||
Stock-based compensation | 19,028 | 16,788 | |||||||||
Amortization of debt discount and issuance costs | 1,087 | 1,440 | |||||||||
Non-cash lease expense | 4,816 | 3,169 | |||||||||
Impairment costs | 113 | — | |||||||||
Net (gain) loss on IRLCs, forward sales commitments, and loans held for sale | (8,326) | 60 | |||||||||
Change in fair value of mortgage servicing rights, net | 1,208 | — | |||||||||
Gain on extinguishment of convertible senior notes | (42,270) | — | |||||||||
Other | (1,174) | 2,290 | |||||||||
Change in assets and liabilities: | |||||||||||
Accounts receivable, net | 6,738 | 17,312 | |||||||||
Inventory | 103,588 | 112,734 | |||||||||
Prepaid expenses and other assets | 1,110 | (1,982) | |||||||||
Accounts payable | (1,675) | 9,876 | |||||||||
Accrued and other liabilities, deferred tax liabilities, and payroll tax liabilities, noncurrent | (16,813) | (14,442) | |||||||||
Lease liabilities | (4,619) | (3,642) | |||||||||
Origination of mortgage servicing rights | (347) | — | |||||||||
Proceeds from sale of mortgage servicing rights | 339 | — | |||||||||
Origination of loans held for sale | (854,085) | (159,186) | |||||||||
Proceeds from sale of loans originated as held for sale | 861,771 | 170,577 | |||||||||
Net cash provided by operating activities | 26,704 | 79,001 | |||||||||
Investing activities | |||||||||||
Purchases of property and equipment | (2,919) | (7,442) | |||||||||
Purchases of investments | (57,556) | (77,596) | |||||||||
Sales of investments | 12,014 | 5,346 | |||||||||
Maturities of investments | 48,483 | 6,500 | |||||||||
Net cash provided by (used in) investing activities | 22 | (73,192) | |||||||||
Financing activities | |||||||||||
Proceeds from the issuance of common stock pursuant to employee equity plans | 143 | 1,887 | |||||||||
Tax payments related to net share settlements on restricted stock units | (3,161) | (2,595) | |||||||||
Borrowings from warehouse credit facilities | 852,988 | 152,386 | |||||||||
Repayments to warehouse credit facilities | (858,214) | (163,144) | |||||||||
Borrowings from secured revolving credit facility | — | 156,799 | |||||||||
Repayments to secured revolving credit facility | — | (219,711) | |||||||||
Cash paid for secured revolving credit facility issuance costs | — | (764) | |||||||||
Principal payments under finance lease obligations | (40) | (217) | |||||||||
Repurchases of convertible senior notes | (108,274) | — | |||||||||
Net cash used in financing activities | (116,558) | (75,359) | |||||||||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (58) | (4) | |||||||||
Net change in cash, cash equivalents, and restricted cash | (89,890) | (69,554) | |||||||||
Cash, cash equivalents, and restricted cash: | |||||||||||
Beginning of period | 242,246 | 718,281 | |||||||||
End of period |
$ | 152,356 | $ | 648,727 |
Three Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||
Mar. 31, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | ||||||||||||||||||||||||||||||||||||||||
Monthly average visitors (in thousands) | 50,440 | 43,847 | 50,785 | 52,698 | 51,287 | 44,665 | 49,147 | 48,437 | |||||||||||||||||||||||||||||||||||||||
Real estate services transactions | |||||||||||||||||||||||||||||||||||||||||||||||
Brokerage | 10,301 | 12,743 | 18,245 | 20,565 | 15,001 | 19,428 | 21,929 | 21,006 | |||||||||||||||||||||||||||||||||||||||
Partner | 3,187 | 2,742 | 3,507 | 3,983 | 3,417 | 4,603 | 4,755 | 4,597 | |||||||||||||||||||||||||||||||||||||||
Total | 13,488 | 15,485 | 21,752 | 24,548 | 18,418 | 24,031 | 26,684 | 25,603 | |||||||||||||||||||||||||||||||||||||||
Real estate services revenue per transaction | |||||||||||||||||||||||||||||||||||||||||||||||
Brokerage | $ | 11,556 | $ | 10,914 | $ | 11,103 | $ | 11,692 | $ | 11,191 | $ | 10,900 | $ | 11,107 | $ | 11,307 | |||||||||||||||||||||||||||||||
Partner | 2,592 | 2,611 | 2,556 | 2,851 | 2,814 | 2,819 | 2,990 | 3,195 | |||||||||||||||||||||||||||||||||||||||
Aggregate | 9,438 | 9,444 | 9,725 | 10,258 | 9,637 | 9,352 | 9,661 | 9,850 | |||||||||||||||||||||||||||||||||||||||
U.S. market share by units(1) |
0.78 | % | 0.76 | % | 0.80 | % | 0.82 | % | 0.79 | % | 0.78 | % | 0.78 | % | 0.77 | % | |||||||||||||||||||||||||||||||
Revenue from top-10 Redfin markets as a percentage of real estate services revenue | 53 | % | 57 | % | 58 | % | 59 | % | 57 | % | 61 | % | 62 | % | 64 | % | |||||||||||||||||||||||||||||||
Average number of lead agents |
1,876 | 2,022 | 2,293 | 2,640 | 2,750 | 2,485 | 2,370 | 2,456 | |||||||||||||||||||||||||||||||||||||||
RedfinNow homes sold | 191 | 474 | 530 | 423 | 617 | 600 | 388 | 292 | |||||||||||||||||||||||||||||||||||||||
Revenue per RedfinNow home sold (in ones) | $ | 573,571 | $ | 538,788 | $ | 550,903 | $ | 604,120 | $ | 608,851 | $ | 622,519 | $ | 599,963 | $ | 571,670 | |||||||||||||||||||||||||||||||
Mortgage originations by dollars (in millions) | $ | 991 | $ | 1,036 | $ | 1,557 | $ | 1,565 | $ | 159 | $ | 242 | $ | 258 | $ | 261 | |||||||||||||||||||||||||||||||
Mortgage originations by units (in ones) | 2,444 | 2,631 | 3,720 | 3,860 | 414 | 591 | 671 | 749 |
Three Months Ended March 31, 2023 | |||||||||||||||||||||||||||||||||||||||||
Real estate services | Properties | Rentals | Mortgage | Other | Corporate Overhead and Intercompany Eliminations | Total | |||||||||||||||||||||||||||||||||||
Revenue | $ | 127,296 | $ | 112,727 | $ | 42,870 | $ | 36,489 | $ | 7,428 | $ | (1,149) | $ | 325,661 | |||||||||||||||||||||||||||
Cost of revenue | 111,494 | 114,658 | 9,765 | 29,213 | 5,473 | (1,149) | 269,454 | ||||||||||||||||||||||||||||||||||
Gross profit | 15,802 | (1,931) | 33,105 | 7,276 | 1,955 | — | 56,207 | ||||||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||||
Technology and development | 28,895 | 529 | 15,964 | 643 | 1,224 | 937 | 48,192 | ||||||||||||||||||||||||||||||||||
Marketing | 25,060 | 505 | 14,326 | 980 | 10 | 27 | 40,908 | ||||||||||||||||||||||||||||||||||
General and administrative | 19,618 | 523 | 26,302 | 6,929 | 1,053 | 15,537 | 69,962 | ||||||||||||||||||||||||||||||||||
Restructuring and reorganization | — | — | — | — | — | 1,053 | 1,053 | ||||||||||||||||||||||||||||||||||
Total operating expenses | 73,573 | 1,557 | 56,592 | 8,552 | 2,287 | 17,554 | 160,115 | ||||||||||||||||||||||||||||||||||
Loss from operations | (57,771) | (3,488) | (23,487) | (1,276) | (332) | (17,554) | (103,908) | ||||||||||||||||||||||||||||||||||
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net | — | 814 | 45 | (60) | 115 | 42,196 | 43,110 | ||||||||||||||||||||||||||||||||||
Net loss | $ | (57,771) | $ | (2,674) | $ | (23,442) | $ | (1,336) | $ | (217) | $ | 24,642 | $ | (60,798) |
Three Months Ended March 31, 2023 | |||||||||||||||||||||||||||||||||||||||||
Real estate services | Properties | Rentals | Mortgage | Other | Corporate Overhead and Intercompany Eliminations | Total | |||||||||||||||||||||||||||||||||||
Net loss | $ | (57,771) | $ | (2,674) | $ | (23,442) | $ | (1,336) | $ | (217) | $ | 24,642 | $ | (60,798) | |||||||||||||||||||||||||||
Interest income(1) |
— | (814) | (80) | (2,490) | (115) | (2,387) | (5,886) | ||||||||||||||||||||||||||||||||||
Interest expense(2) |
— | — | — | 2,615 | — | 1,921 | 4,536 | ||||||||||||||||||||||||||||||||||
Income tax expense | — | — | 43 | 68 | — | 299 | 410 | ||||||||||||||||||||||||||||||||||
Depreciation and amortization | 4,432 | 122 | 10,152 | 988 | 216 | 1,103 | 17,013 | ||||||||||||||||||||||||||||||||||
Stock-based compensation(3) |
9,593 | 248 | 3,616 | 1,258 | 561 | 3,752 | 19,028 | ||||||||||||||||||||||||||||||||||
Restructuring and reorganization(4) |
— | — | — | — | — | 1,053 | 1,053 | ||||||||||||||||||||||||||||||||||
Impairment(5) |
— | — | — | — | — | 113 | 113 | ||||||||||||||||||||||||||||||||||
Gain on extinguishment of convertible senior notes | — | — | — | — | — | (42,270) | (42,270) | ||||||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | (43,746) | $ | (3,118) | $ | (9,711) | $ | 1,103 | $ | 445 | $ | (11,774) | $ | (66,801) |
Three Months Ended March 31, 2022 | |||||||||||||||||||||||||||||||||||||||||
Real estate services | Properties | Rentals | Mortgage | Other | Corporate Overhead and Intercompany Eliminations | Total | |||||||||||||||||||||||||||||||||||
Revenue | $ | 177,487 | $ | 379,753 | $ | 38,044 | $ | 2,917 | $ | 4,368 | $ | (5,223) | $ | 597,346 | |||||||||||||||||||||||||||
Cost of revenue | 153,784 | 358,866 | 7,193 | 5,517 | 4,671 | (5,223) | 524,808 | ||||||||||||||||||||||||||||||||||
Gross profit | 23,703 | 20,887 | 30,851 | (2,600) | (303) | — | 72,538 | ||||||||||||||||||||||||||||||||||
Operating expenses | |||||||||||||||||||||||||||||||||||||||||
Technology and development | 26,739 | 4,119 | 14,282 | 2,347 | 1,036 | 1,117 | 49,640 | ||||||||||||||||||||||||||||||||||
Marketing | 30,844 | 1,153 | 11,042 | 28 | 53 | 222 | 43,342 | ||||||||||||||||||||||||||||||||||
General and administrative | 22,992 | 2,825 | 24,192 | 1,524 | 712 | 6,721 | 58,966 | ||||||||||||||||||||||||||||||||||
Restructuring and reorganization | — | — | — | — | — | 5,710 | 5,710 | ||||||||||||||||||||||||||||||||||
Total operating expenses | 80,575 | 8,097 | 49,516 | 3,899 | 1,801 | 13,770 | 157,658 | ||||||||||||||||||||||||||||||||||
Income (loss) from operations | (56,872) | 12,790 | (18,665) | (6,499) | (2,104) | (13,770) | (85,120) | ||||||||||||||||||||||||||||||||||
Interest income, interest expense, income tax expense, and other expense, net | — | (1,624) | 469 | 1 | 1 | (4,533) | (5,686) | ||||||||||||||||||||||||||||||||||
Net loss | $ | (56,872) | $ | 11,166 | $ | (18,196) | $ | (6,498) | $ | (2,103) | $ | (18,303) | $ | (90,806) |
Three Months Ended March 31, 2022 | |||||||||||||||||||||||||||||||||||||||||
Real estate services | Properties | Rentals | Mortgage | Other | Corporate Overhead and Intercompany Eliminations | Total | |||||||||||||||||||||||||||||||||||
Net loss | $ | (56,872) | $ | 11,166 | $ | (18,196) | $ | (6,498) | $ | (2,103) | $ | (18,303) | $ | (90,806) | |||||||||||||||||||||||||||
Interest income(1) |
— | (25) | — | (318) | (1) | (194) | (538) | ||||||||||||||||||||||||||||||||||
Interest expense(2) |
— | 1,649 | — | 277 | — | 2,212 | 4,138 | ||||||||||||||||||||||||||||||||||
Income tax expense | — | — | (203) | — | — | 337 | 134 | ||||||||||||||||||||||||||||||||||
Depreciation and amortization | 4,018 | 537 | 9,356 | 302 | 255 | 345 | 14,813 | ||||||||||||||||||||||||||||||||||
Stock-based compensation(3) |
10,140 | 1,537 | 2,240 | 601 | 369 | 1,901 | 16,788 | ||||||||||||||||||||||||||||||||||
Acquisition-related costs(4) |
— | — | — | — | — | 917 | 917 | ||||||||||||||||||||||||||||||||||
Restructuring and reorganization(5) |
— | — | — | — | — | 5,710 | 5,710 | ||||||||||||||||||||||||||||||||||
Adjusted EBITDA | $ | (42,714) | $ | 14,864 | $ | (6,803) | $ | (5,636) | $ | (1,480) | $ | (7,075) | $ | (48,844) |
Q2 2023 | |||||||||||
Low | High | ||||||||||
Net loss | (44) | (35) | |||||||||
Depreciation and amortization | 17 | 17 | |||||||||
Stock-based compensation | 17 | 17 | |||||||||
Restructuring and reorganization | 5 | 5 | |||||||||
Gain on extinguishment of convertible senior notes | (4) | (4) | |||||||||
Adjusted EBITDA | (9) | 1 |