Frontdoor (NASDAQ:FTDR) Releases Quarterly Earnings Results, Beats Estimates By $0.04 EPS

Key Points

• Frontdoor beat third-quarter estimates, posting adjusted EPS of $1.81 versus $1.77 expected and revenue of $655 million versus $647.7 million expected. Revenue grew 6% year over year, while adjusted EPS rose 15% from a year earlier.
• Membership trends improved: renewals returned to growth, retention rose 30 basis points to 79.7%, and direct-to-consumer members increased 4%. Non-warranty revenue climbed 32%, led by HVAC upgrades.
• Frontdoor raised its full-year revenue and adjusted EBITDA outlook and authorized a new $1 billion share repurchase. It expects about 1% total member growth, though a frozen housing market is expected to weigh on its real estate channel.

Frontdoor (NASDAQ:FTDR - Get Free Report) issued its quarterly earnings data on Thursday. The company reported $1.81 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.77 by $0.04, FiscalAI reports. The firm had revenue of $655.00 million for the quarter, compared to analyst estimates of $647.73 million. Frontdoor had a net margin of 12.72% and a return on equity of 120.90%. Frontdoor's revenue was up 6.0% on a year-over-year basis. During the same period in the previous year, the firm earned $1.58 EPS.

Here are the key takeaways from Frontdoor's conference call:

• Third-quarter revenue rose 6% to $655 million and adjusted EBITDA increased 5% to $205 million, despite weather-related claims costs that reduced gross margin by 200 basis points. Adjusted EPS climbed 15% to $1.81, and adjusted EBITDA exceeded the midpoint of the company’s outlook.
• Total ending members grew 1%, with renewals returning to growth and retention improving 30 basis points year over year to 79.7%. Direct-to-consumer members grew 4%, their eighth consecutive quarter of year-over-year growth.
• Non-warranty revenue increased 32%, led by HVAC upgrades; Frontdoor now expects about $175 million in HVAC upgrade revenue for 2026. The company said only about 3% of its members have purchased a system through the program and plans to expand into appliances.
• Frontdoor expects a frozen housing market to weigh on its real estate channel and lowered its outlook for that channel’s ending members to be flat by year-end 2026. The company still expects approximately 1% total member growth, supported by renewals and direct-to-consumer.
• The company raised its full-year revenue and adjusted EBITDA outlook at the midpoint and announced a new three-year, $1 billion share repurchase authorization. It had repurchased approximately 5% of shares outstanding through September.

Frontdoor Stock Up 1.2%

Frontdoor stock traded up $1.11 during trading on Friday, reaching $97.09. The stock had a trading volume of 1,008,622 shares, compared to its average volume of 637,524. The company has a quick ratio of 1.59, a current ratio of 1.59 and a debt-to-equity ratio of 3.98. Frontdoor has a 52-week low of $48.47 and a 52-week high of $103.07. The stock has a market cap of $6.69 billion, a PE ratio of 24.27 and a beta of 1.60. The business has a 50 day moving average price of $80.90 and a 200 day moving average price of $70.15.

Wall Street Analyst Weigh In

Several brokerages have recently commented on FTDR. JPMorgan Chase & Co. assumed coverage on shares of Frontdoor in a report on Monday, August 24th. They issued a "neutral" rating and a $95.00 price objective on the stock. Benchmark upped their price target on Frontdoor from $80.00 to $96.00 and gave the stock a "buy" rating in a research note on Friday, August 7th. Oppenheimer upped their price target on Frontdoor from $70.00 to $100.00 and gave the stock an "outperform" rating in a research note on Friday, August 7th. Wolfe Research raised Frontdoor to an "outperform" rating in a research note on Monday, August 24th. Finally, Weiss Ratings raised Frontdoor from a "hold (c+)" rating to a "buy (b)" rating in a research note on Wednesday, October 21st. Five research analysts have rated the stock with a Buy rating and two have issued a Hold rating to the stock. Based on data from MarketBeat.com, the stock has a consensus rating of "Moderate Buy" and a consensus price target of $97.40.

Key Headlines Impacting Frontdoor

Here are the key news stories impacting Frontdoor this week:

• Positive Sentiment: Truist Financial raised its price target on FTDR from $105 to $115 and reiterated a “buy” rating. The new target implies about 18% upside from the cited share price. Truist Financial recommendations
• Positive Sentiment: Third-quarter results exceeded expectations: Frontdoor reported EPS of $1.81 versus the $1.77 consensus and revenue of $655 million versus an estimated $647.7 million. Revenue rose 6% year over year, while EPS increased from $1.58 a year earlier. Frontdoor Q3 earnings and revenues beat estimates
• Positive Sentiment: Fourth-quarter revenue guidance of $453 million to $463 million has a midpoint above analysts’ $455.1 million estimate, suggesting a modest near-term outlook beat. Frontdoor Q4 revenue outlook
• Positive Sentiment: A report highlighted a new $1 billion buyback, which could support shareholder returns and demand for the stock. Frontdoor Q3 2026: Heat Wave, Beat, and a New $1B Buyback
• Neutral Sentiment: Full-year 2026 revenue guidance of $2.2 billion is in line with consensus, so it offers little change to current expectations. Frontdoor Q3 2026 earnings call transcript

About Frontdoor

Frontdoor, Inc NASDAQ: FTDR is a provider of home warranties and related home repair services. The company helps homeowners manage the cost and complexity of maintaining household systems and appliances, including heating and cooling equipment, plumbing, electrical systems, water heaters and major kitchen appliances.

Frontdoor operates primarily through its American Home Shield brand, which offers home service plans and access to a network of professional contractors. The company also provides digital tools and services designed to help homeowners diagnose household problems, request service and connect with qualified professionals.

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