Frontdoor Raises Full-Year Outlook as Adjusted EBITDA Growth Accelerates
The home warranty provider raised its full-year revenue guidance to a range of $2.19 billion to $2.21 billion.
Frontdoor (FTDR), the home warranty provider, reported second-quarter revenue of $645 million, an increase of 5% year-over-year.
The company saw a marked acceleration in profitability during the period. Adjusted EBITDA rose 10% year-over-year to $220 million, a sharper increase than the 3% growth to $104 million recorded in the first quarter.
Gross profit margins expanded to 59% in the second quarter, up from 55% in the prior quarter. This margin expansion coincided with a decrease in contract claims costs, which fell by $7 million year-over-year. Favorable weather contributed $5 million to that reduction, reversing a $6 million increase in claims costs seen in the first quarter.
Revenue growth was supported by a 3% increase from realized price and a 1% increase from volume. These figures represent a shift from the first quarter, where price contributed 5% and volume 1% to growth. The home warranty ending member count rose 1% year-over-year to 2.11 million, compared to a flat member count of 2.10 million in the first quarter.
Performance across revenue streams was mixed. Other revenue grew 19% year-over-year, though this was a deceleration from the 23% increase seen in the first quarter. Direct-to-consumer revenue decreased 2% year-over-year, an improvement over the 5% decrease reported in the first quarter.
Frontdoor raised its full-year 2026 revenue guidance to between $2.19 billion and $2.21 billion from a previous range of $2.155 billion to $2.195 billion. The company also increased its full-year adjusted EBITDA guidance to a range of $585 million to $600 million, up from the prior guide of $565 million to $580 million.
Through July 2026, the company spent $181 million on share repurchases, an increase of over 21% compared to the same period in the previous year.