Key Highlights

  • Revenue grew 6% to USD 655 million, Net Income was USD 116 million and Adjusted EBITDA was USD 205 million.
  • Adjusted EPS grew 15% to USD 1.81 per share, and the company returned USD 259 million through repurchases this year.
  • The board approved a new three-year USD 1 billion share repurchase authorization, announced by management.
  • Non-warranty and other Revenue grew 32% in the third quarter, led by the HVAC upgrade program.

Frontdoor, Inc. (NASDAQ:FTDR) reported third quarter 2026 revenue of USD 655 million, net income of USD 116 million and Adjusted EBITDA of USD 205 million, compared with USD 618 million, USD 106 million and USD 195 million. Adjusted EPS was USD 1.81.

Management said revenue grew 6%, with growth split evenly between price and volume, and that Adjusted EBITDA increased 5% as disciplined cost management helped absorb higher claims from extreme heat.

Nine-Month Results and Revenue Mix

For the nine months ended September 30, 2026, revenue, net income and Adjusted EBITDA were USD 1,752 million, USD 283 million and USD 528 million, versus USD 1,660 million, USD 253 million and USD 494 million.

Nine-month revenue included 75% from existing customer renewals, 7% from home warranty sales made with existing home real estate transactions, 8% from direct-to-consumer sales and 11% from non-warranty and other channels, versus 76%, 7%, 9% and 9% in the prior-year period. Frontdoor describes itself as the leading provider of home warranties and new home builder warranties in the United States by revenue, operating primarily under the American Home Shield, HSA, OneGuard, Landmark and 2-10 HBW brands.

Channels and Repurchases

Renewal revenue grew 4% on higher price and stable volume, and the renewal channel ended the third quarter at approximately 1.6 million members after edging back into growth. Direct-to-consumer ending member count grew 4% to approximately 330,000 members, the eighth consecutive quarter of year-over-year growth.

Management lowered its expectation for real estate channel ending member count to flat by the end of 2026, citing near-term headwinds in housing, while maintaining approximately 1% total member growth for 2026. The first-year real estate channel is about 7% of total revenue.

Non-warranty and other revenue grew 32%, led by the HVAC upgrade program, with approximately USD 175 million of HVAC upgrade revenue anticipated this year, up from USD 13 million four years ago.

Through September the company repurchased approximately 5% of shares outstanding for USD 259 million and now anticipates completing its existing authorization in November, nearly a year early, ahead of the new three-year USD 1 billion authorization.

Housing Backdrop

Management noted that home prices have increased for 39 straight months to an average of about USD 420,000, that Mortgage rates are back above 7%, that about 15% of signed contracts fell through in September, and that existing home sales fell to just under a seasonally adjusted 4 million, a historic low. It views the first-year real estate channel as a long-term option despite its small share of revenue. Reported detail: The board approved a new three-year USD 1 billion share repurchase authorization, announced by management. Non-warranty and other revenue grew 32% in the third quarter, led by the HVAC upgrade program.