Redfin Reports First Quarter 2021 Financial Results

SEATTLE, May 5, 2021 /PRNewswire/ -- Redfin Corporation (NASDAQ: RDFN) today announced financial results for the first quarter ended March 31, 2021. All financial measures, unless otherwise noted, are presented on a GAAP basis and include stock-based compensation, and depreciation and amortization.

Redfin Logo (PRNewsfoto/Redfin)

Revenue increased 40% year-over-year to $268 million during the first quarter. Gross profit was $42 million, an increase of 229% from $13 million in the first quarter of 2020. Real estate services gross profit was $40 million, an increase of 168% from $15 million in the first quarter of 2020. Real estate services gross margin was 24%, compared to 14% in the first quarter of 2020. Operating expenses were $77 million, an increase of 9% from $70 million in the first quarter of 2020. Operating expenses were 29% of revenue, down from 37% in the first quarter of 2020.

Net loss was $36 million, compared to net loss of $60 million in the first quarter of 2020. The dividend on our convertible preferred stock was $2.3 million in the first quarter. Net loss attributable to common stock was $38 million. Stock-based compensation was $12.6 million, up from $7.2 million in the first quarter of 2020. Depreciation and amortization was $4.4 million, up from $3.3 million in the first quarter of 2020. Interest income was $0.2 million and interest expense was $1.3 million, compared to $1.1 million and $2.4 million, respectively, in the first quarter of 2020.

Net loss per share attributable to common stock, diluted, was $0.37, compared to net loss per share, diluted, of $0.64 in the first quarter of 2020.

"After scrambling in the second half of 2020 to hire enough agents and lenders to handle a pandemic-driven surge in demand, Redfin is just about hitting on all cylinders," said Redfin CEO Glenn Kelman. "From the fourth quarter of 2020 to the first quarter of 2021, our year-over-year market-share gains more than doubled, and our year-over-year gross-margin gains also accelerated. We tripled the rate at which we're scheduling home tours instantly and automatically, giving our customers a competitive advantage when homes are selling faster than ever. Our RedfinNow business of buying and selling homes returned to growth and earned its first significant gross profits, and our mortgage business continued to grow at a year-over-year rate of about 200%."

First Quarter Highlights

  • Reached market share of 1.14% of U.S. existing home sales by value in the first quarter of 2021, an increase of 21 basis points from the first quarter of 2020.(1)
  • Saved homebuyers and sellers over $42 million in the first quarter. 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.
  • Redfin's mobile application and website reached 46 million average monthly users in the first quarter, an increase of 30% compared to the first quarter of 2020.
  • Completed the acquisition of RentPath on April 2. RentPath is a leading rental listings company, with sites including ApartmentGuide.com, Rent.com, and Rentals.com. Combined with RentPath, Redfin can now be a nationwide destination for all consumers looking for a home.
  • Continued expansion of RedfinNow by launching in Phoenix, Maryland, Northern Virginia and Washington D.C. in the first quarter of 2021.
  • Launched Redfin Premier service for luxury homes in Lake Tahoe, Los Angeles, Santa Barbara, San Francisco, Seattle and Washington, D.C., expanding from 14 to 20 markets. Redfin Premier offers high-end photography and premium marketing to showcase million dollar homes and reach luxury buyers around the globe.
  • Upgraded our software for customers, agents, partners, home services and mortgage teams, including:
    • Shipped new software for home sale advisors to stay in touch with prospective home sellers and guide them toward the Redfin selling solution that meets their needs whether that is listing with a Redfin agent or getting a cash offer from RedfinNow.
    • Began publishing the commission offered to the buyer agent on homes for sale to give consumers more transparent information about real estate agent fees.
  • Published our 2020 Diversity at Redfin report to track our progress and the next steps in our efforts to make Redfin a better place to work for all people. The share of women and people of color at the company and within leadership roles increased from 2019 to 2020. While there is continued opportunity for improvement, the percentage of Black employees rose from 7.5% to 8.5% and the number of Latinx employees rose from 8.4% to 10.0%.
  • Subsequent to the first quarter, launched our annual media campaign on April 19 featuring on-demand tours.
    • TV ads are airing in 15 markets and on national cable networks: Welcome to Redfin.
    • Supporting listing growth with digital videos on YouTube and Facebook.
    • Developed new radio ads to drive customers to tour with Redfin.

(1) We calculate the aggregate value of U.S. home sales by multiplying the total number of U.S. existing home sales by the mean sale price of these homes, each as reported by the National Association of REALTORS®. We calculate our market share by aggregating the home value of brokerage and partner real estate services transactions. Then, in order to account for both the sell- and buy-side components of each transaction, we divide that value by two-times the estimated aggregate value of U.S. home sales.

Business Outlook
The following forward-looking statements reflect Redfin's expectations as of May 5, 2021, and are subject to substantial uncertainty.

For the second quarter of 2021 we expect:

  • Total revenue between $446 million and $457 million, representing a year-over-year increase between 109% and 114% compared to the second quarter of 2020. Included within total revenue are properties segment revenue between $151 million and $156 million, and RentPath revenue between $41 million and $42 million.
  • Total net loss between $38 million and $32 million, compared to total net loss of $7 million in the second quarter of 2020. RentPath's contribution to the net loss is expected to be between $10 million and $9 million. This guidance includes approximately $13 million of expected stock-based compensation, $10 million of expected depreciation and amortization, $6 million of expected transaction fees associated with the RentPath acquisition, and $3 million of expected net interest expense. Net income attributable to common stockholders will include the value of dividends on our convertible preferred stock, which we expect to pay in shares of our common stock.

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, 2020, as supplemented by our quarterly report for the quarter ended March 31, 2021, 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.

About Redfin
Redfin (www.redfin.com) is a technology-powered real estate broker, instant home-buyer (iBuyer), lender, title insurer, and renovations company. We sell homes for more money and charge half the fee. We also run the country's #1 real-estate brokerage site. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can take an instant cash offer from Redfin or have our renovations crew fix up their home to sell for top dollar. Since launching in 2006, we've saved customers more than $1 billion in commissions. We serve more than 95 markets across the U.S. and Canada and employ over 4,100 people.

Redfin-F

Redfin Corporation and Subsidiaries

Consolidated Statements of Comprehensive Loss

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



Three Months Ended March 31,


2021


2020





Revenue




Service

$

175,593



$

111,478


Product

92,726



79,517


Total revenue

268,319



190,995


Cost of revenue(1)




Service

134,851



98,368


Product

91,110



79,748


Total cost of revenue

225,961



178,116


Gross profit

42,358



12,879


Operating expenses




Technology and development(1)

27,678



20,274


Marketing(1)

11,802



25,708


General and administrative(1)

37,391



24,327


Total operating expenses

76,871



70,309


Loss from operations

(34,513)



(57,430)


Interest income

159



1,103


Interest expense

(1,338)



(2,444)


Other income (expense), net

(92)



(1,346)


Net loss

$

(35,784)



$

(60,117)


Dividends on convertible preferred stock

(2,336)




Net loss attributable to common stock—basic and diluted

$

(38,120)



$

(60,117)


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

$

(0.37)



$

(0.64)


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

103,427,764



93,442,706






Net Loss

$

(35,784)



$

(60,117)


Other comprehensive income (loss)




     Foreign currency translation adjustments

$



$

(25)


     Unrealized gain (loss) on available-for-sale securities

(50)



559


Comprehensive loss

$

(35,834)



$

(59,583)



(1) Includes stock-based compensation as follows:



Three Months Ended March 31,


2021


2020





Cost of revenue

$

2,978



$

1,638


Technology and development

5,761



3,648


Marketing

542



375


General and administrative

3,302



1,550


Total

$

12,583



$

7,211


 

Redfin Corporation and Subsidiaries

Consolidated Balance Sheets

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



March 31, 2021


December 31, 2020





Assets




Current assets




Cash and cash equivalents

$

1,241,255



$

925,276


Restricted cash

101,790



20,544


Short-term investments

140,843



131,561


Accounts receivable, net of allowances for credit losses of $182 and $160

47,416



54,719


Inventory

97,371



49,158


Loans held for sale

43,447



42,539


Prepaid expenses

15,224



12,131


Other current assets

7,014



4,898


Total current assets

1,694,360



1,240,826


Property and equipment, net

47,649



43,988


Right-of-use assets, net

47,932



44,149


Long-term investments

6,906



11,922


Goodwill and intangibles, net

10,894



11,016


Other assets, noncurrent

8,836



8,619


Total assets

$

1,816,577



$

1,360,520


Liabilities, mezzanine equity and stockholders' equity




Current liabilities




Accounts payable

$

15,568



$

5,644


Accrued liabilities

75,754



69,460


Other payables

19,117



13,184


Warehouse credit facilities

40,663



39,029


Secured revolving credit facility

48,851



23,949


Convertible senior notes, net

23,428



22,482


Lease liabilities

12,611



11,973


Total current liabilities

235,992



185,721


Lease liabilities and deposits, noncurrent

53,333



49,339


Convertible senior notes, net, noncurrent

1,136,974



488,268


Payroll tax liabilities, noncurrent

6,812



6,812


Total liabilities

1,433,111



730,140


Commitments and contingencies (Note 7)




Series A convertible preferred stock—par value $0.001 per share; 10,000,000 shares authorized; 40,000 shares issued and outstanding

39,834



39,823


Stockholders' equity




Common stock—par value $0.001 per share; 500,000,000 shares authorized; 103,983,585 and 103,000,594 shares issued and outstanding, respectively

104



103


Additional paid-in capital

641,702



860,556


Accumulated other comprehensive income

161



211


Accumulated deficit

(298,335)



(270,313)


Total stockholders' equity

343,632



590,557


Total liabilities, mezzanine equity and stockholders' equity

$

1,816,577



$

1,360,520






 

Redfin Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(in thousands, unaudited)


Three Months Ended March 31,


2021


2020





Operating Activities




Net loss

$

(35,784)



$

(60,117)


Adjustments to reconcile net loss to net cash used in operating activities:




Depreciation and amortization

4,341



3,307


Stock-based compensation

12,583



7,211


Amortization of debt discount and issuance costs

855



1,730


Non-cash lease expense

2,533



2,254


Impairment costs



1,420


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

(1,052)



(494)


Other

109



(119)


Change in assets and liabilities:




Accounts receivable, net

7,303



(2,598)


Inventory

(48,213)



3,941


Prepaid expenses and other assets

(3,359)



4,934


Accounts payable

5,947



514


Accrued liabilities, other payables, and non-current payroll tax liabilities

8,873



18,725


Lease liabilities

(2,951)



(2,693)


Origination of loans held for sale

(227,090)



(132,697)


Proceeds from sale of loans originated as held for sale

225,140



111,233


Net cash provided by (used in) operating activities

(50,765)



(43,449)


Investing activities




Purchases of property and equipment

(5,285)



(3,406)


Purchases of investments

(67,877)



(33,267)


Sales of investments



31,608


Maturities of investments

63,589



1,597


Net cash used in investing activities

(9,573)



(3,468)


Financing activities




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

3,411



4,103


Tax payments related to net share settlements on restricted stock units

(10,860)



(3,307)


Borrowings from warehouse credit facilities

216,382



131,310


Repayments to warehouse credit facilities

(214,747)



(110,025)


Borrowings from secured revolving credit facility

71,177



11,854


Repayments to secured revolving credit facility

(46,275)



(7,398)


Proceeds from issuance of convertible senior notes, net of issuance costs

488,691




Purchases of capped calls related to convertible senior notes

(54,480)




Payments for repurchases and conversions of convertible senior notes

(1,886)




Other payables—deposits held in escrow

6,521



3,684


Principal payments under finance lease obligations

(67)



(15)


Cash paid for secured revolving credit facility issuance costs

(305)




Net cash provided by financing activities

457,562



30,206


Effect of exchange rate changes on cash and cash equivalents

1



(25)


Net change in cash, cash equivalents, and restricted cash

397,225



(16,736)


Cash, cash equivalents, and restricted cash:




Beginning of period

945,820



247,448


End of period

1,343,045



230,712


 

Redfin Corporation and Subsidiaries

Supplemental Financial Information and Business Metrics

(unaudited)



Three Months Ended




Mar. 31,
2021


Dec. 31,
2020


Sep. 30
2020


Jun. 30,
2020


Mar. 31,
2020


Dec. 31,
2019


Sep. 30,
2019


Jun. 30,
2019


Mar. 31,
2019



















Monthly average visitors (in thousands)

46,202



44,135



49,258



42,537



35,519



30,595



35,633



36,557



31,107


Real estate services transactions


















Brokerage

14,317



16,951



18,980



13,828



10,751



13,122



16,098



15,580



8,435


Partner

3,944



4,940



5,180



2,691



2,479



2,958



3,499



3,357



2,125


Total

18,261



21,891



24,160



16,519



13,230



16,080



19,597



18,937



10,560


Real estate services revenue per transaction


















Brokerage

$

10,927



$

10,751



$

10,241



$

9,296



$

9,520



$

9,425



$

9,075



$

9,332



$

9,640


Partner

3,084



3,123



2,988



2,417



2,535



2,369



2,295



2,218



2,153


Aggregate

9,233



9,030



8,686



8,175



8,211



8,127



7,865



8,071



8,134


Aggregate home value of real estate services transactions (in millions)

$

9,621



$

11,478



$

12,207



$

7,576



$

6,098



$

7,588



$

9,157



$

8,986



$

4,800


U.S. market share by value

1.14

%


1.04

%


1.04

%


0.93

%


0.93

%


0.94

%


0.96

%


0.94

%


0.83

%

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

62

%


63

%


63

%


63

%


61

%


62

%


63

%


64

%


64

%

Average number of lead agents

2,277



1,981



1,820



1,399



1,826



1,526



1,579



1,603



1,503


RedfinNow homes sold

171



83



37



162



171



212



168



80



43


Revenue per RedfinNow home sold

$

525,173



$

471,551



$

504,583



$

444,690



$

461,916



$

466,939



$

476,770



$

498,083



$

496,437


 

Redfin Corporation and Subsidiaries

Supplemental Financial Information

(unaudited, in thousands)



Three Months Ended March 31,


2021


2020

Real estate services revenue




Brokerage revenue

$

156,447



$

102,351


Partner revenue

12,162



6,285


Total real estate services revenue

168,609



108,636


Properties revenue

92,726



79,098


Other revenue

9,357



4,250


Intercompany elimination

(2,373)



(989)


Total revenue

$

268,319



$

190,995






Cost of revenue




Real estate services

$

128,216



$

93,562


Properties

91,130



79,299


Other

8,988



6,244


Intercompany elimination

(2,373)



(989)


Total cost of revenue

$

225,961



$

178,116






Gross profit




Real estate services

$

40,393



$

15,074


Properties

1,596



(201)


Other

369



(1,994)


Total gross profit

$

42,358



$

12,879






Gross margin (percentage of revenue)




Real estate services

24.0

%


13.9

%

Properties

1.7



(0.3)


Other

3.9



(46.9)


Total gross margin

15.8



6.7


 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/redfin-reports-first-quarter-2021-financial-results-301284775.html

SOURCE Redfin

Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.