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Redfin Reports Third Quarter 2023 Financial Results

November 2, 2023 4:00 PM

SEATTLE--(BUSINESS WIRE)-- Redfin Corporation (NASDAQ: RDFN) today announced results for its third quarter ended September 30, 2023.

Third Quarter 2023

Third quarter revenue was $269.0 million, a decrease of 12% compared to the third quarter of 2022. Gross profit was $98.3 million, an increase of 8% year-over-year. Real estate services gross profit was $54.1 million, a decrease of 2% year-over-year, and real estate services gross margin was 30%, compared to 26% in the third quarter of 2022.

Net loss was $19.0 million, compared to a net loss of $90.2 million in the third quarter of 2022. Net loss attributable to common stock was $19.3 million. Net loss per share attributable to common stock, diluted, was $0.17, compared to net loss per share, diluted, of $0.83 in the third quarter of 2022.

“In a worsening housing market, Redfin earned an adjusted EBITDA profit, a $59 million improvement over the third quarter of 2022, all while growing traffic and gaining share,” said Redfin CEO Glenn Kelman. “In October, we raised capital, began generating revenues from a new digital business, and launched all-variable agent pay in California. This downturn has only made us stronger.”

Third Quarter Highlights

Business Outlook

The following forward-looking statements reflect Redfin's expectations as of November 2, 2023, and are subject to substantial uncertainty.

For the fourth quarter of 2023 we expect:

Conference Call

Redfin will webcast a conference call to discuss the results at 1:30 p.m. Pacific Time today. The webcast will be open to the public at http://investors.redfin.com. The webcast will remain available on the investor relations website for at least three months following the conference call.

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. 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 December 31, 2022, as supplemented by our quarterly report for the quarter ended September 30, 2023, both of which are available on our Investor Relations website at http://investors.redfin.com and on the SEC website at www.sec.gov. All forward-looking statements reflect our beliefs and assumptions only as of the date of this press release. We undertake no obligation to update forward-looking statements to reflect future events or circumstances.

Non-GAAP Financial Measure

To supplement our consolidated financial statements that are prepared and presented in accordance with GAAP, we also compute and present adjusted EBITDA, which is a non-GAAP financial measure. We believe adjusted EBITDA is useful for investors because it enhances period-to-period comparability of our financial statements on a consistent basis and provides investors with useful insight into the underlying trends of the business. The presentation of this financial measure is not intended to be considered in isolation or as a substitute of, or superior to, our financial information prepared and presented in accordance with GAAP. Our calculation of adjusted EBITDA may be different from adjusted EBITDA or similar non-GAAP financial measures used by other companies, limiting its usefulness for comparison purposes. Our adjusted EBITDA for the three months ended September 30, 2023 and 2022 is presented below, along with a reconciliation of adjusted EBITDA to net loss.

About Redfin

Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, rentals, lending, title insurance, and renovations services. We also run the country's #1 real estate brokerage site. Our home-buying customers see homes first with same day tours, and our lending and title services help them close quickly. Customers selling a home in certain markets can have our renovations crew fix up their home to sell for top dollar. Our rentals business empowers millions nationwide to find apartments and houses for rent. Customers who buy and sell with Redfin pay a 1% listing fee, subject to minimums, less than half of what brokerages commonly charge. Since launching in 2006, we've saved customers more than $1.5 billion in commissions. We serve more than 100 markets across the U.S. and Canada and employ over 4,000 people.

Redfin-F

Redfin Corporation and Subsidiaries

Consolidated Balance Sheets

(in thousands, except share and per share amounts, unaudited)

September 30, 2023

December 31, 2022

Assets

Current assets

Cash and cash equivalents

$

125,803

$

232,200

Restricted cash

1,414

2,406

Short-term investments

41,752

122,259

Accounts receivable, net of allowances for credit losses of $2,529 and $2,223

55,118

46,375

Loans held for sale

137,680

199,604

Prepaid expenses

26,248

34,006

Other current assets

8,811

7,449

Current assets of discontinued operations

132,159

Total current assets

396,826

776,458

Property and equipment, net

48,405

54,939

Right-of-use assets, net

35,150

40,889

Mortgage servicing rights, at fair value

34,773

36,261

Long-term investments

5,474

29,480

Goodwill

461,349

461,349

Intangible assets, net

133,031

162,272

Other assets, noncurrent

10,857

11,247

Noncurrent assets of discontinued operations

1,309

Total assets

$

1,125,865

$

1,574,204

Liabilities, mezzanine equity, and stockholders' equity

Current liabilities

Accounts payable

$

11,996

$

11,065

Accrued and other liabilities

88,191

106,763

Warehouse credit facilities

132,320

190,509

Convertible senior notes, net

23,431

Lease liabilities

16,317

18,560

Current liabilities of discontinued operations

4,311

Total current liabilities

248,824

354,639

Lease liabilities, noncurrent

31,416

36,906

Convertible senior notes, net, noncurrent

799,665

1,078,157

Deferred tax liabilities

260

243

Noncurrent liabilities of discontinued operations

392

Total liabilities

1,080,165

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 September 30, 2023 and December 31, 2022, respectively

39,947

39,914

Stockholders’ equity

Common stock—par value $0.001 per share; 500,000,000 shares authorized; 115,210,998 and 109,696,178 shares issued and outstanding at September 30, 2023 and December 31, 2022, respectively

115

110

Additional paid-in capital

806,330

757,951

Accumulated other comprehensive loss

(257

)

(801

)

Accumulated deficit

(800,435

)

(693,307

)

Total stockholders’ equity

5,753

63,953

Total liabilities, mezzanine equity, and stockholders’ equity

$

1,125,865

$

1,574,204

Redfin Corporation and Subsidiaries

Consolidated Statements of Comprehensive Loss

(in thousands, except share and per share amounts, unaudited)

Three Months Ended September 30,

Nine Months Ended September 30,

2023

2022

2023

2022

Revenue

$

268,956

$

305,774

$

758,595

$

877,639

Cost of revenue

170,616

215,109

501,927

624,089

Gross profit

98,340

90,665

256,668

253,550

Operating expenses

Technology and development

44,392

43,335

139,196

135,678

Marketing

24,095

33,242

97,531

131,352

General and administrative

55,380

57,976

186,584

182,640

Restructuring and reorganization

284

7,159

18,399

Total operating expenses

123,867

134,837

430,470

468,069

Loss from continuing operations

(25,527

)

(44,172

)

(173,802

)

(214,519

)

Interest income

2,060

1,174

8,170

1,948

Interest expense

(1,603

)

(2,219

)

(5,291

)

(6,648

)

Income tax expense

(239

)

(132

)

(882

)

(425

)

Gain on extinguishment of convertible senior notes

6,495

68,848

Other expense, net

(158

)

(902

)

(537

)

(3,077

)

Net loss from continuing operations

(18,972

)

(46,251

)

(103,494

)

(222,721

)

Net loss from discontinued operations

(43,994

)

(3,634

)

(36,476

)

Net loss

$

(18,972

)

$

(90,245

)

$

(107,128

)

$

(259,197

)

Dividends on convertible preferred stock

(335

)

(272

)

(858

)

(1,416

)

Net loss from continuing operations attributable to common stock—basic and diluted

$

(19,307

)

$

(46,523

)

$

(104,352

)

$

(224,137

)

Net loss attributable to common stock—basic and diluted

$

(19,307

)

$

(90,517

)

$

(107,986

)

$

(260,613

)

Net loss from continuing operations per share attributable to common stock—basic and diluted

$

(0.17

)

$

(0.43

)

$

(0.93

)

$

(2.08

)

Net loss attributable to common stock per share—basic and diluted

$

(0.17

)

$

(0.83

)

$

(0.96

)

$

(2.42

)

Weighted-average shares to compute net loss per share attributable to common stock—basic and diluted

114,592,679

108,618,491

112,141,342

107,566,894

Net loss

$

(18,972

)

$

(90,245

)

$

(107,128

)

$

(259,197

)

Other comprehensive income

Foreign currency translation adjustments

(15

)

27

(73

)

65

Unrealized gain on available-for-sale debt securities

210

34

617

812

Comprehensive loss

$

(18,777

)

$

(90,184

)

$

(106,584

)

$

(258,320

)

(1) Includes stock-based compensation as follows:

Three Months Ended September 30,

Nine Months Ended September 30,

2023

2022

2023

2022

Cost of revenue

$

3,037

$

4,165

$

10,173

$

10,771

Technology and development

8,391

6,353

24,759

20,230

Marketing

1,337

1,002

3,836

2,939

General and administrative

6,035

4,904

16,380

13,022

Total

$

18,800

$

16,424

$

55,148

$

46,962

Redfin Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(in thousands, unaudited)

Nine Months Ended September 30,

2023

2022

Operating Activities

Net loss

$

(107,128

)

$

(259,197

)

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization

48,443

47,438

Stock-based compensation

55,382

51,672

Amortization of debt discount and issuance costs

2,873

4,358

Non-cash lease expense

12,909

11,313

Impairment costs

113

913

Net (gain) loss on IRLCs, forward sales commitments, and loans held for sale

(1,767

)

4,228

Change in fair value of mortgage servicing rights, net

1,065

(1,472

)

Gain on extinguishment of convertible senior notes

(68,848

)

Other

(2,013

)

3,254

Change in assets and liabilities:

Accounts receivable, net

(238

)

(17,052

)

Inventory

114,232

56,990

Prepaid expenses and other assets

9,696

(2,721

)

Accounts payable

177

(1,875

)

Accrued and other liabilities, deferred tax liabilities, and payroll tax liabilities, noncurrent

(19,346

)

(24,202

)

Lease liabilities

(14,864

)

(12,435

)

Origination of mortgage servicing rights

(699

)

(2,774

)

Proceeds from sale of mortgage servicing rights

1,122

1,314

Origination of loans held for sale

(2,798,337

)

(3,091,099

)

Proceeds from sale of loans originated as held for sale

2,858,656

3,082,858

Net cash provided by (used in) operating activities

91,428

(148,489

)

Investing activities

Purchases of property and equipment

(9,235

)

(17,496

)

Purchases of investments

(76,866

)

(145,273

)

Sales of investments

124,681

12,946

Maturities of investments

59,383

66,055

Cash paid for acquisition, net of cash, cash equivalents, and restricted cash acquired

(97,341

)

Net cash provided by (used in) investing activities

97,963

(181,109

)

Financing activities

Proceeds from the issuance of common stock pursuant to employee equity plans

5,790

9,679

Tax payments related to net share settlements on restricted stock units

(15,961

)

(6,650

)

Borrowings from warehouse credit facilities

2,803,589

3,080,606

Repayments to warehouse credit facilities

(2,861,779

)

(3,069,728

)

Borrowings from secured revolving credit facility

552,051

Repayments to secured revolving credit facility

(549,416

)

Cash paid for secured revolving credit facility issuance costs

(764

)

Principal payments under finance lease obligations

(73

)

(680

)

Repurchases of convertible senior notes

(212,401

)

Repayments of convertible senior notes

(23,512

)

Net cash (used in) provided by financing activities

(304,347

)

15,098

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(73

)

(65

)

Net change in cash, cash equivalents, and restricted cash

(115,029

)

(314,565

)

Cash, cash equivalents, and restricted cash:

Beginning of period

242,246

718,281

End of period

$

127,217

$

403,716

Redfin Corporation and Subsidiaries

Supplemental Financial Information and Business Metrics

(unaudited)

Three Months Ended

Sep. 30,
2023

Jun. 30,
2023

Mar. 31,
2023

Dec. 31,
2022

Sep. 30,
2022

Jun. 30,
2022

Mar. 31,
2022

Dec. 31,
2021

Monthly average visitors (in thousands)

51,309

52,308

50,440

43,847

50,785

52,698

51,287

44,665

Real estate services transactions

Brokerage

13,075

13,716

10,301

12,743

18,245

20,565

15,001

19,428

Partner

4,351

3,952

3,187

2,742

3,507

3,983

3,417

4,603

Total

17,426

17,668

13,488

15,485

21,752

24,548

18,418

24,031

Real estate services revenue per transaction

Brokerage

$

12,704

$

12,376

$

11,556

$

10,914

$

11,103

$

11,692

$

11,191

$

10,900

Partner

2,677

2,756

2,592

2,611

2,556

2,851

2,814

2,819

Aggregate

10,200

10,224

9,438

9,444

9,725

10,258

9,637

9,352

U.S. market share by units(1)

0.78

%

0.75

%

0.79

%

0.76

%

0.80

%

0.83

%

0.79

%

0.78

%

Revenue from top-10 Redfin markets as a percentage of real estate services revenue

56

%

55

%

53

%

57

%

58

%

59

%

57

%

61

%

Average number of lead agents

1,744

1,792

1,876

2,022

2,293

2,640

2,750

2,485

Mortgage originations by dollars (in millions)

$

1,110

$

1,282

$

991

$

1,036

$

1,557

$

1,565

$

159

$

242

Mortgage originations by units (in ones)

2,786

3,131

2,444

2,631

3,720

3,860

414

591

(1) Prior to the second quarter of 2022, we reported our U.S. market share based on the aggregate home value of our real estate services transactions, relative to the aggregate value of all U.S. home sales, which we computed based on the mean sale price of U.S. homes provided by the National Association of REALTORS® (“NAR”). Beginning in the second quarter of 2022, NAR (1) revised its methodology of computing the mean sale price, (2) restated its previously reported mean sale price beginning from January 2020 (and indicated that previously reported mean sale price prior to January 2020 is not comparable), and (3) discontinued publication of the mean sale price as part of its primary data set. Due to these changes, as of the second quarter of 2022, we report our U.S. market share based on the number of homes sold, rather than the dollar value of homes sold. Our market share by number of homes sold has historically been lower than our market share by dollar value of homes sold. We also stopped reporting the aggregate home value of our real estate services transactions.

Redfin Corporation and Subsidiaries

Supplemental Financial Information

(unaudited, in thousands)

Three Months Ended September 30, 2023

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Revenue

$

177,750

$

47,410

$

32,923

$

10,873

$

$

268,956

Cost of revenue

123,684

10,824

29,629

6,479

170,616

Gross profit

54,066

36,586

3,294

4,394

98,340

Operating expenses

Technology and development

25,711

15,813

800

1,133

935

44,392

Marketing

10,785

12,245

1,088

20

(43

)

24,095

General and administrative

18,418

21,838

6,670

952

7,502

55,380

Total operating expenses

54,914

49,896

8,558

2,105

8,394

123,867

(Loss) income from continuing operations

(848

)

(13,310

)

(5,264

)

2,289

(8,394

)

(25,527

)

Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net

41

42

(73

)

207

6,338

6,555

Net (loss) income from continuing operations

$

(807

)

$

(13,268

)

$

(5,337

)

$

2,496

$

(2,056

)

$

(18,972

)

Three Months Ended September 30, 2023

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Net (loss) income from continuing operations

$

(807

)

$

(13,268

)

$

(5,337

)

$

2,496

$

(2,056

)

$

(18,972

)

Interest income(1)

(41

)

(81

)

(2,886

)

(207

)

(1,732

)

(4,947

)

Interest expense(2)

3,132

1,598

4,730

Income tax expense

37

70

132

239

Depreciation and amortization

3,123

9,681

947

233

312

14,296

Stock-based compensation(3)

11,151

4,255

473

574

2,347

18,800

Gain on extinguishment of convertible senior notes

(6,495

)

(6,495

)

Adjusted EBITDA

$

13,426

$

624

$

(3,601

)

$

3,096

$

(5,894

)

$

7,651

(1) Interest income includes $2.9 million of interest income related to originated mortgage loans for the three months ended September 30, 2023.

(2) Interest expense includes $3.1 million of interest expense related to our warehouse credit facilities for the three months ended September 30, 2023.

(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information.

Three Months Ended September 30, 2022

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Revenue(1)

$

211,540

$

38,686

$

48,469

$

7,079

$

$

305,774

Cost of revenue

156,632

8,676

43,783

6,018

215,109

Gross profit

54,908

30,010

4,686

1,061

90,665

Operating expenses

Technology and development

25,709

15,385

985

751

505

43,335

Marketing

18,772

12,678

1,653

48

91

33,242

General and administrative

20,244

22,722

7,073

784

7,153

57,976

Restructuring and reorganization

284

284

Total operating expenses

64,725

50,785

9,711

1,583

8,033

134,837

Loss from continuing operations

(9,817

)

(20,775

)

(5,025

)

(522

)

(8,033

)

(44,172

)

Interest income, interest expense, income tax expense, and other expense, net

397

(129

)

40

(2,387

)

(2,079

)

Net loss from continuing operations

$

(9,817

)

$

(20,378

)

$

(5,154

)

$

(482

)

$

(10,420

)

$

(46,251

)

(1) Included in revenue is $4.9 million from providing services to our discontinued properties segment.

Three Months Ended September 30, 2022

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Net loss from continuing operations

$

(9,817

)

$

(20,378

)

$

(5,154

)

$

(482

)

$

(10,420

)

$

(46,251

)

Interest income(1)

(4,049

)

(42

)

(1,115

)

(5,206

)

Interest expense(2)

3,364

2,215

5,579

Income tax expense

(355

)

141

346

132

Depreciation and amortization

4,388

9,683

1,053

241

291

15,656

Stock-based compensation(3)

9,834

3,632

1,209

341

1,408

16,424

Acquisition-related costs(4)

13

13

Restructuring and reorganization(5)

284

284

Impairment(6)

913

913

Adjusted EBITDA

$

4,405

$

(7,418

)

$

(3,436

)

$

58

$

(6,065

)

$

(12,456

)

(1) Interest income includes $4.0 million of interest income related to originated mortgage loans for the three months ended September 30, 2022.

(2) Interest expense includes $3.4 million of interest expense related to our warehouse credit facilities for the three months ended September 30, 2022.

(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information.

(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies.

(5) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention for our rentals segment due to the restructuring and reorganization activities from our acquisition of Rent.

(6) Impairment consists of an impairment loss due to subleasing one of our operating leases.

Nine Months Ended September 30, 2023

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Revenue(1)

$

485,687

$

135,636

$

107,838

$

29,434

$

$

758,595

Cost of revenue

359,625

31,016

93,108

18,178

501,927

Gross profit

126,062

104,620

14,730

11,256

256,668

Operating expenses

Technology and development

82,650

48,081

2,177

3,475

2,813

139,196

Marketing

51,849

42,509

3,122

46

5

97,531

General and administrative

58,997

73,445

20,323

3,049

30,770

186,584

Restructuring and reorganization

7,159

7,159

Total operating expenses

193,496

164,035

25,622

6,570

40,747

430,470

(Loss) income from continuing operations

(67,434

)

(59,415

)

(10,892

)

4,686

(40,747

)

(173,802

)

Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net

41

115

(224

)

475

69,901

70,308

Net (loss) income from continuing operations

$

(67,393

)

$

(59,300

)

$

(11,116

)

$

5,161

$

29,154

$

(103,494

)

(1) Included in revenue is $1.2 million from providing services to our discontinued properties segment.

Nine Months Ended September 30, 2023

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Net (loss) income from continuing operations

$

(67,393

)

$

(59,300

)

$

(11,116

)

$

5,161

$

29,154

$

(103,494

)

Interest income(1)

(41

)

(238

)

(9,062

)

(475

)

(7,400

)

(17,216

)

Interest expense(2)

9,737

5,285

15,022

Income tax expense

123

222

537

882

Depreciation and amortization

12,819

30,068

2,929

756

1,745

48,317

Stock-based compensation(3)

33,041

11,580

2,554

1,696

6,277

55,148

Acquisition-related costs(4)

8

8

Restructuring and reorganization(5)

7,159

7,159

Impairment(6)

113

113

Gain on extinguishment of convertible senior notes

(68,848

)

(68,848

)

Adjusted EBITDA

$

(21,574

)

$

(17,767

)

$

(4,736

)

$

7,138

$

(25,970

)

$

(62,909

)

(1) Interest income includes $9.0 million of interest income related to originated mortgage loans for the nine months ended September 30, 2023.

(2) Interest expense includes $9.7 million of interest expense related to our warehouse credit facilities for the nine months ended September 30, 2023.

(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information.

(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies.

(5) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention due to the restructuring and reorganization activities from our acquisitions of Bay Equity and Rent., and from our June 2022, October 2022, and March 2023 workforce reductions.

(6) Impairment consists of an impairment loss due to subleasing one of our operating leases.

Nine Months Ended September 30, 2022

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Revenue(1)

$

640,835

$

114,979

$

104,484

$

17,341

$

$

877,639

Cost of revenue

488,114

23,769

95,616

16,590

624,089

Gross profit

152,721

91,210

8,868

751

253,550

Operating expenses

Technology and development

80,144

44,539

5,236

2,975

2,784

135,678

Marketing

90,380

36,806

3,525

173

468

131,352

General and administrative

67,578

68,738

18,047

2,346

25,931

182,640

Restructuring and reorganization

18,399

18,399

Total operating expenses

238,102

150,083

26,808

5,494

47,582

468,069

Loss from operations

(85,381

)

(58,873

)

(17,940

)

(4,743

)

(47,582

)

(214,519

)

Interest income, interest expense, income tax expense, and other expense, net

(123

)

1,098

(164

)

51

(9,064

)

(8,202

)

Net loss from continuing operations

$

(85,504

)

$

(57,775

)

$

(18,104

)

$

(4,692

)

$

(56,646

)

$

(222,721

)

(1) Included in revenue is $14.9 million from providing services to our discontinued properties segment.

Nine Months Ended September 30, 2022

Real estate
services

Rentals

Mortgage

Other

Corporate
overhead

Total

Net loss from continuing operations

$

(85,504

)

$

(57,775

)

$

(18,104

)

$

(4,692

)

$

(56,646

)

$

(222,721

)

Interest income(1)

(1

)

(7,296

)

(55

)

(1,876

)

(9,228

)

Interest expense(2)

5,599

6,642

12,241

Income tax expense

(789

)

174

1,040

425

Depreciation and amortization

12,957

28,550

2,425

814

909

45,655

Stock-based compensation(3)

29,644

8,611

2,590

1,151

4,966

46,962

Acquisition-related costs(4)

2,437

2,437

Restructuring and reorganization(5)

18,399

18,399

Impairment(6)

913

913

Adjusted EBITDA

$

(42,903

)

$

(21,404

)

$

(14,612

)

$

(2,782

)

$

(23,216

)

$

(104,917

)

(1) Interest income includes $7.3 million of interest income related to originated mortgage loans for the nine months ended September 30, 2023.

(2) Interest expense includes $5.6 million of interest expense related to our warehouse credit facilities for the nine months ended September 30, 2023.

(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information.

(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies.

(5) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention due to the restructuring and reorganization activities from our acquisitions of Bay Equity and Rent., and from our June 2022, October 2022, and March 2023 workforce reductions.

(6) Impairment consists of an impairment loss due to subleasing one of our operating leases.

Reconciliation of Adjusted EBITDA Guidance to Net Loss Guidance

(unaudited, in millions)

Q4 2023

Low

High

Net loss

(27

)

(18

)

Net interest expense

3

2

Depreciation and amortization

15

15

Stock-based compensation

18

18

Gain on extinguishment of notes

(27

)

(27

)

Adjusted EBITDA

(19

)

(9

)

Note: Figures may not sum due to rounding.

Investor Relations

Meg Nunnally, 206-576-8610

[email protected]

Public Relations

Mariam Sughayer, 206-876-1322

[email protected]

Source: Redfin Corporation

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