Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 28, 2022 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Fiscal Period Focus | Q3 | |
Document Transition Report | false | |
Entity File Number | 001-38617 | |
Entity Registrant Name | Frontdoor, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 82-3871179 | |
Entity Address, Address Line One | 150 Peabody Place | |
Entity Address, City or Town | Memphis | |
Entity Address, State or Province | TN | |
Entity Address, Postal Zip Code | 38103 | |
City Area Code | 901 | |
Local Phone Number | 701-5000 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | FTDR | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 81,492,761 | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Entity Central Index Key | 0001727263 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Condensed Consolidated Statement of Operations and Comprehensive Income [Abstract] | ||||
Revenue | $ 484 | $ 471 | $ 1,322 | $ 1,263 |
Cost of services rendered | 274 | 217 | 757 | 619 |
Gross Profit | 210 | 254 | 565 | 644 |
Selling and administrative expenses | 137 | 138 | 403 | 392 |
Depreciation and amortization expense | 8 | 8 | 25 | 27 |
Goodwill and intangibles impairment | 14 | 14 | ||
Restructuring charges | 5 | 18 | 2 | |
Interest expense | 8 | 7 | 22 | 32 |
Interest and net investment income | (1) | (1) | (1) | |
Loss on extinguishment of debt | 31 | |||
Income before Income Taxes | 39 | 101 | 85 | 161 |
Provision for income taxes | 11 | 25 | 23 | 39 |
Net Income | 28 | 76 | 63 | 122 |
Other Comprehensive Income, Net of Income Taxes: | ||||
Net unrealized gain on derivative instruments | 9 | 2 | 26 | 10 |
Total Comprehensive Income | $ 37 | $ 79 | $ 89 | $ 131 |
Earnings per Share: | ||||
Basic | $ 0.34 | $ 0.89 | $ 0.77 | $ 1.42 |
Diluted | $ 0.34 | $ 0.89 | $ 0.77 | $ 1.42 |
Weighted-average Common Shares Outstanding: | ||||
Basic | 81.5 | 85.5 | 82 | 85.5 |
Diluted | 81.6 | 85.9 | 82.1 | 85.9 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Financial Position - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Current Assets: | ||
Cash and cash equivalents | $ 244 | $ 262 |
Receivables, less allowance of $4 and $2, respectively | 4 | 7 |
Contract asset | 65 | |
Prepaid expenses and other assets | 29 | 25 |
Total Current Assets | 343 | 295 |
Other Assets: | ||
Property and equipment, net | 64 | 66 |
Goodwill | 503 | 512 |
Intangible assets, net | 149 | 159 |
Operating lease right-of-use assets | 9 | 17 |
Deferred customer acquisition costs | 17 | 16 |
Other assets | 10 | 5 |
Total Assets | 1,095 | 1,069 |
Current Liabilities: | ||
Accounts payable | 89 | 66 |
Accrued liabilities: | ||
Payroll and related expenses | 23 | 24 |
Home service plan claims | 123 | 88 |
Other | 27 | 28 |
Deferred revenue | 113 | 155 |
Current portion of long-term debt | 17 | 17 |
Total Current Liabilities | 391 | 378 |
Long-Term Debt | 596 | 608 |
Other Long-Term Liabilities: | ||
Deferred taxes | 37 | 41 |
Operating lease liabilities | 16 | 19 |
Other long-term obligations | 8 | 21 |
Total Other Long-Term Liabilities | 60 | 81 |
Commitments and Contingencies (Note 8) | ||
Shareholders' Equity: | ||
Common stock, $0.01 par value; 2,000,000,000 shares authorized; 86,053,212 shares issued and 81,490,682 shares outstanding at September 30, 2022 and 85,798,765 shares issued and 83,232,481 shares outstanding as of December 31, 2021 | 1 | 1 |
Additional paid-in capital | 85 | 70 |
Retained earnings | 116 | 53 |
Accumulated other comprehensive income (loss) | 8 | (18) |
Less common stock held in treasury, at cost; 4,562,530 shares at September 30, 2022 and 2,566,284 shares as of December 31, 2021 | (162) | (103) |
Total Equity | 47 | 2 |
Total Liabilities and Shareholders' Equity | $ 1,095 | $ 1,069 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Financial Position (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Condensed Consolidated Statements of Financial Position [Abstract] | ||
Allowance for receivables (in dollars) | $ 4 | $ 2 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 2,000,000,000 | 2,000,000,000 |
Common stock, shares issued (in shares) | 86,053,212 | 85,798,765 |
Common stock, shares outstanding (in shares) | 81,490,682 | 83,232,481 |
Treasury stock (in shares) | 4,562,530 | 2,566,284 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Changes in Equity - USD ($) $ in Millions | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings (Accumulated Deficit) [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Common Stock Held In Treasury [Member] | Total |
Balance at beginning of period at Dec. 31, 2020 | $ 1 | $ 46 | $ (75) | $ (33) | ||
Net income | 122 | $ 122 | ||||
Exercise of stock options | 2 | |||||
Issuance of common stock | 1 | |||||
Taxes paid related to net share settlement of equity awards | (5) | |||||
Stock-based employee compensation | 19 | |||||
Repurchase of common stock | (25) | (25) | ||||
Other comprehensive income, net of tax | 10 | 10 | ||||
Balance at end of period at Sep. 30, 2021 | 1 | 63 | 47 | (24) | (25) | 62 |
Balance at beginning of period at Jun. 30, 2021 | 1 | 57 | (30) | (26) | ||
Net income | 76 | 76 | ||||
Exercise of stock options | 1 | |||||
Stock-based employee compensation | 5 | |||||
Repurchase of common stock | (25) | (25) | ||||
Other comprehensive income, net of tax | 2 | |||||
Balance at end of period at Sep. 30, 2021 | 1 | 63 | 47 | (24) | (25) | 62 |
Balance at beginning of period at Dec. 31, 2021 | 1 | 70 | 53 | (18) | (103) | 2 |
Net income | 63 | 63 | ||||
Taxes paid related to net share settlement of equity awards | (3) | |||||
Stock-based employee compensation | 17 | |||||
Issuance of common stock upon ESPP purchase | 1 | |||||
Repurchase of common stock | (59) | (59) | ||||
Other comprehensive income, net of tax | 26 | 26 | ||||
Balance at end of period at Sep. 30, 2022 | 1 | 85 | 116 | 8 | (162) | 47 |
Balance at beginning of period at Jun. 30, 2022 | 1 | 80 | 88 | (1) | (162) | |
Net income | 28 | 28 | ||||
Stock-based employee compensation | 5 | |||||
Repurchase of common stock | ||||||
Other comprehensive income, net of tax | 9 | |||||
Balance at end of period at Sep. 30, 2022 | $ 1 | $ 85 | $ 116 | $ 8 | $ (162) | $ 47 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Condensed Consolidated Statements of Cash Flows [Abstract] | ||
Cash and Cash Equivalents at Beginning of Period | $ 262 | $ 597 |
Cash Flows from Operating Activities: | ||
Net Income | 63 | 122 |
Adjustments to reconcile net income to net cash provided from operating activities: | ||
Depreciation and amortization expense | 25 | 27 |
Deferred income tax (benefit) provision | (12) | 2 |
Stock-based compensation expense | 17 | 19 |
Goodwill and intangibles impairment | 14 | |
Restructuring charges | 18 | 2 |
Payments for restructuring charges | (2) | (1) |
Loss on extinguishment of debt | 31 | |
Other | (1) | 5 |
Change in working capital: | ||
Receivables | 3 | |
Prepaid expenses and other current assets | (68) | (49) |
Accounts payable | 23 | 20 |
Deferred revenue | (42) | (41) |
Accrued liabilities | 29 | 6 |
Accrued interest payable | (9) | |
Current income taxes | 15 | 7 |
Net Cash Provided from Operating Activities | 80 | 142 |
Cash Flows from Investing Activities: | ||
Purchases of property and equipment | (30) | (23) |
Other investing activities | 5 | |
Net Cash Used for Investing Activities | (25) | (23) |
Cash Flows from Financing Activities: | ||
Borrowings of debt, net of discount | 638 | |
Payments of debt and finance lease obligations | (13) | (990) |
Debt issuance cost paid | (8) | |
Call premium paid on retired debt | (21) | |
Repurchase of common stock | (59) | (25) |
Other financing activities | (2) | (2) |
Net Cash Used for Financing Activities | (74) | (407) |
Cash Decrease During the Period | (19) | (289) |
Cash and Cash Equivalents at End of Period | $ 244 | $ 309 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | Note 1. Basis of Presentation Frontdoor is the leading provider of home service plans in the United States, as measured by revenue, and operates under the American Home Shield, HSA, OneGuard and Landmark brands. Our customizable home service plans help customers protect and maintain their homes, typically their most valuable asset, from costly and unplanned breakdowns of essential home systems and appliances. Our home service plan customers usually subscribe to an annual service plan agreement that covers the repair or replacement of major components of more than 20 home systems and appliances, including electrical, plumbing, HVAC systems, water heaters, refrigerators, dishwashers and ranges/ovens/cooktops, as well as optional coverages for electronics, pools, spas and pumps. Our operations also include our ProConnect on-demand home services business and Streem, a technology platform that uses augmented reality, computer vision and machine learning to, among other things, help home service professionals more quickly and accurately diagnose breakdowns and complete repairs. At September 30, 2022, we had 2.2 million active home service plans across all 50 states and the District of Columbia. We recommend that the accompanying condensed consolidated financial statements be read in conjunction with the audited consolidated financial statements and the notes thereto included in our 2021 Form 10-K. The accompanying condensed consolidated financial statements reflect all normal and recurring adjustments that are, in the opinion of management, necessary for the fair presentation of the financial position, results of operations and cash flows for the interim periods presented. The results of operations for any interim period are not indicative of the results that might be achieved for a full year. Macroeconomic Conditions Changes in macroeconomic conditions, including inflation, global supply chain challenges and the persistence of the COVID-19 pandemic, especially as they may affect existing home sales, interest rates, consumer confidence or labor availability, may reduce demand for our services, increase our costs and adversely impact our business. While these macroeconomic conditions generally impact the United States as a whole, we believe our nationwide presence limits the risk of poor economic conditions in any particular region of the United States. During the first nine months of 2022, our financial condition and results of operations were adversely impacted by the following: The challenging home seller’s market, driven, in part, by extremely low home inventory levels, continued to constrain demand for home service plans in the first-year real estate channel. Our contractors continued to be impacted by inflation, including higher labor, fuel and parts and equipment costs. We continue to take actions to mitigate these impacts, including increasing the share of parts and equipment our contractors source through us, increasing the percent of service requests completed by lower-cost preferred contractors and accelerating contractor recruitment efforts. Industry-wide parts availability challenges continued to drive elevated appliance replacement levels due to lack of parts availability, further contributing to increased costs and adversely impacting the customer experience, which was reflected in our customer retention rate. Due to labor availability challenges, we continued to experience workforce retention issues, including difficulties in hiring and retaining employees in customer service operations and throughout our business, and we believe our contractors are experiencing similar workforce challenges. The COVID-19 Pandemic The implications of the ongoing COVID-19 pandemic on our results of operations and overall financial performance remain uncertain. Moreover, as a result of the increase in remote or hybrid working arrangements in response to the pandemic, which trend may continue to persist even as the pandemic continues to subside, a significant number of people may continue to spend greater time at home, which may result in a continued increase in usage of home systems and appliances and demand for our services and a resulting increase in service-related costs. We also expect that industry-wide supply chain challenges may continue to contribute to increased costs and impact the customer experience, which may affect customer retention. Accordingly, the COVID-19 situation remains very fluid, and we continue to adjust our response in real time. It remains difficult to predict the overall continuing impact the COVID-19 pandemic will have on our business. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Significant Accounting Policies [Abstract] | |
Significant Accounting Policies | f Note 2. Significant Accounting Policies Our significant accounting policies are described in Note 2 to the audited consolidated financial statements included in our 2021 Form 10-K. There have been no material changes to the significant accounting policies for the nine months ended September 30, 2022. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2022 | |
Revenue [Abstract] | |
Revenue | Note 3. Revenue The majority of our revenue is generated from annual home service plan agreements entered into with our customers. Our home service plan agreements have one performance obligation, which is to provide for the repair or replacement of essential home systems and appliances, as applicable per the contract. We recognize revenue at the agreed upon contractual amount over time using the input method in proportion to the costs expected to be incurred in performing services under the contracts. Those costs bear a direct relationship to the fulfillment of our obligations under the contracts and are representative of the relative value provided to the customer. As the costs to fulfill the obligations of the home service plans are incurred on an other-than-straight-line basis, we utilize historical evidence to estimate the expected claims expense and related timing of such costs. This adjustment to the straight-line revenue creates a contract asset or contract liability, as described under the heading “Contract balances” below. We regularly review our estimates of claims costs and adjust our estimates when appropriate. We derive substantially all of our revenue from customers in the United States. We disaggregate revenue from contracts with customers into major customer acquisition channels. We determined that disaggregating revenue into these categories depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors. Revenue by major customer acquisition channel is as follows: Three Months Ended Nine Months Ended September 30, September 30, (In millions) 2022 2021 2022 2021 Renewals $ 356 $ 328 $ 949 $ 867 Real estate (1) 51 73 153 207 Direct-to-consumer (1) 64 59 176 157 Other 13 11 44 31 Total $ 484 $ 471 $ 1,322 $ 1,263 _____________________________ (1) First-year revenue only. Renewals Revenue from all customer renewals, whether initiated via the real estate or direct-to-consumer channel, are classified as renewals above. Customer payments for renewals are received either at the commencement of the renewal period or in installments over the contract period. Real estate Real estate home service plans are sold through annual contracts in connection with a real estate sale, and payments are typically paid in full at closing. First-year revenue from the real estate channel is classified as real estate above. Direct-to-consumer Direct-to-consumer home service plans are sold through annual contracts when customers request a service plan in response to marketing efforts or when third-party resellers make a sale. Customer payments are received either at the commencement of the contract or in installments over the contract period. First-year revenue from the direct-to-consumer channel is classified as direct-to-consumer above. Other Other revenue includes revenue generated by our ProConnect on-demand home services business and Streem, as well as administrative fees and ancillary services attributable to our home service plan agreements. Costs to obtain a contract with a customer We capitalize the incremental costs of obtaining a contract with a customer, primarily sales commissions, and recognize the expense using the input method in proportion to the costs expected to be incurred in performing services under the contract, over the expected customer relationship period. Deferred customer acquisition costs were $ 17 million and $ 16 million as of September 30, 2022 and December 31, 2021, respectively. Amortization of these deferred acquisition costs was $ 6 million and $ 5 million for the three months ended September 30, 2022 and 2021, respectively, and $ 15 million for each of the nine-month periods ended September 30, 2022 and 2021. There were no impairment losses in relation to these capitalized costs. Contract balances Timing of revenue recognition may differ from the timing of invoicing to customers. Contracts with customers, including contracts resulting from customer renewals, are generally for a period of one year . We record a receivable related to revenue recognized on services once we have an unconditional right to invoice and receive payment in the future related to the services provided. All accounts receivable are recorded within Receivables, less allowances, in the accompanying condensed consolidated statements of financial position. We invoice our monthly-pay customers on a straight-line basis over the contract term. As a result, a contract asset is created when revenue is recognized on monthly-pay customers before being billed. As of September 30, 2022, a contract asset of $ 65 million was recorded related to the recognition of monthly-pay customer revenue on an other-than-straight-line basis to match the timing of cost recognition. Deferred revenue represents a contract liability and is recognized when cash payments are received in advance of the performance of services, including when the amounts are refundable. Amounts are recognized as revenue in proportion to the costs expected to be incurred in performing services under our contracts. Deferred revenue was $ 113 million and $ 155 million as of September 30, 2022 and December 31, 2021, respectively. Changes in deferred revenue for the nine months ended September 30, 2022 were as follows: (In millions) Deferred Revenue Balance as of December 31, 2021 $ 155 Deferral of revenue 209 Recognition of deferred revenue ( 251 ) Balance as of September 30, 2022 $ 113 There was approximately $ 33 million and $ 155 million of revenue recognized in the three and nine months ended September 30, 2022, respectively, that was included in the deferred revenue balance as of December 31, 2021. Deferred revenue decreased during the nine months ended September 30, 2022, reflecting a decline in the number of first-year real estate home service plans and the recognition of previously deferred amounts on an other than straight-line basis to match the timing of cost recognition. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets [Abstract] | |
Goodwill and Intangible Assets | Note 4. Goodwill and Intangible Assets Goodwill and indefinite-lived intangible assets are not amortized and are subject to assessment for impairment on an annual basis or more frequently if circumstances indicate a potential impairment. An assessment for impairment is performed on October 1 of every year. In connection with the preparation of our condensed consolidated financial statements for the third quarter of 2022, we determined that indicators of a potential goodwill and intangible assets impairment were present for our Streem reporting unit. In particular, we will now be more focused on integrating Streem’s technology into the core business and will be less focused on selling this technology platform to third-party business-to-business customers as a software-as-a-service platform. This shift in focus resulted in significantly lower projected revenue for Streem. We performed an interim impairment analysis of the Streem reporting unit as of September 30, 2022. In performing the discounted cash flow analysis, we determined that the carrying amount of the Streem reporting unit exceeded its fair value. An impairment charge of $ 14 million was recognized during the third quarter, which comprised the remaining net book value of Streem’s goodwill of $ 9 million and intangibles of $ 5 million. The balance of goodwill was $ 503 million as of September 30, 2022 and $ 512 million as of December 31, 2021. There were no goodwill or trade name impairment charges recorded in the three or nine months ended September 30, 2021, and there were no accumulated impairment losses recorded as of December 31, 2021. The table below summarizes the other intangible asset balances: As of September 30, 2022 As of December 31, 2021 (In millions) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Trade names (1) $ 141 $ — $ 141 $ 141 $ — $ 141 Customer relationships 173 ( 172 ) — 173 ( 172 ) — Developed technology (2) 19 ( 12 ) 6 25 ( 12 ) 13 Other (3) 32 ( 31 ) 2 37 ( 32 ) 5 Total $ 364 $ ( 216 ) $ 149 $ 375 $ ( 216 ) $ 159 _____________________________ (1) Not subject to amortization. (2) Includes a net $ 3 million impairment relating to the Streem reporting unit, which comprises $ 6 million of gross cost and $ 4 million of accumulated amortization. (3) Includes a net $ 2 million impairment relating to the Streem reporting unit, which comprises $ 4 million of gross cost and $ 2 million of accumulated amortization. Amortization expense was $ 2 million for each of the three months ended September 30, 2022 and 2021 and $ 6 million and $ 8 million for the nine months ended September 30, 2022 and 2021, respectively. The following table outlines expected amortization expense for existing intangible assets for the remainder of 2022 and the next five years : (In millions) 2022 (remainder) $ 1 2023 4 2024 2 2025 — 2026 — 2027 — Total $ 8 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Leases | Note 5. Leases We have operating leases primarily for our corporate offices, customer service centers and engineering and technology campuses. Our leases have remaining lease terms of less than one year to 12 years, some of which include options to extend the leases for up to five years . Renewal options that are reasonably certain to be exercised are included in the lease term. An incremental borrowing rate is used in determining the present value of lease payments unless an implicit rate is readily determinable. Incremental borrowing rates are determined based on our secured borrowing rating and the lease term. The weighted-average remaining lease term and weighted-average discount rate related to operating leases is as follows: As of September 30, December 31, 2022 2021 Weighted-average remaining lease term (years) 8 9 Weighted-average discount rate 5.6 % 5.6 % We recognized operating lease expense of $ 1 million for each of the three-month periods ended September 30, 2022 and 2021 and $ 3 million for each of the nine-month periods ended September 30, 2022 and 2021 . These expenses are included in Selling and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive income. Supplemental cash flow information related to operating leases is as follows: Nine Months Ended September 30, (In millions) 2022 2021 Cash paid for amounts included in the measurement of lease liabilities $ 4 $ 4 Leased assets obtained in exchange for new lease liabilities — 6 Supplemental balance sheet information related to operating leases is as follows: As of September 30, December 31, (In millions) 2022 2021 Other accrued liabilities $ 4 $ 4 Operating lease liabilities 16 19 Total operating lease liabilities $ 20 $ 23 The following table presents maturities of our operating lease liabilities as of September 30, 2022. (In millions) 2022 (remainder) $ 1 2023 (1) 4 2024 (1) 2 2025 (1) 1 2026 (1) 2 2027 2 Thereafter 10 Total lease payments 22 Less imputed interest ( 6 ) Total $ 16 _____________________________ (1) Each of the years ending December 31, 2023 through 2026 presented net of approximately $ 1 million of projected annual sublease income. Sublease of Company Headquarters On August 10, 2022, we subleased our corporate headquarters facility in Memphis, Tennessee. As a result of us exiting the facility on June 27, 2022, we incurred a non-cash impairment charge of $ 11 million for the nine months ended September 30, 2022. There were no such charges for the three months ended September 30, 2022. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Taxes [Abstract] | |
Income Taxes | Note 6. Income Taxes As required by ASC 740, we compute interim period income taxes by applying an anticipated annual effective tax rate to our year-to-date income or loss from operations before income taxes, except for significant unusual or infrequently occurring items. Our estimated tax rate is adjusted each quarter in accordance with ASC 740. The effective tax rate on income was 28.2 percent and 24.3 percent for the three months ended September 30, 2022 and 2021, respectively, and 26.5 percent and 24.4 percent for nine months ended September 30, 2022 and 2021, respectively . The increase in the effective tax rate for both the three and nine months ended September 30, 2022 compared to 2021 is primarily due to share-based awards and impairment of goodwill and intangible assets, offset, in part, by income tax credits and state income taxes. We are subject to taxation in the United States, various states and foreign jurisdictions. Substantially all of our income before income taxes for the nine months ended September 30 , 2022 and 2021 was generated in the United States. |
Restructuring Charges
Restructuring Charges | 9 Months Ended |
Sep. 30, 2022 | |
Restructuring Charges [Abstract] | |
Restructuring Charges | Note 7. Restructuring Charges We incurred restructuring charges of $ 5 million ($ 4 million, net of tax) and less than $ 1 million (less than $ 1 million, net of tax) for the three months ended September 30, 2022 and 2021, respectively, and $ 18 million ($ 13 million, net of tax) and $ 2 million ($ 1 million, net of tax) for the nine months ended September 30, 2022 and 2021, respectively. For the three months ended September 30, 2022, restructuring charges primarily comprised a $ 2 million impairment of certain internally developed software and $ 3 million of severance and other costs. Severance costs of $ 2 million related to a reduction in workforce of seven percent as part of our completed strategic review of our selling, general and administrative expenses. For the nine months ended September 30, 2022, restructuring charges primarily comprised an $ 11 million impairment charge related to our Memphis headquarters facility operating lease right-of-use asset and leasehold improvements, a $ 2 million impairment of certain internally developed software and $ 5 million of severance and other costs. Severance costs of $ 2 million related to a reduction in workforce of seven percent as part of our completed strategic review of our selling, general and administrative expenses. For the three months ended September 30, 2021 , restructuring charges primarily comprised severance costs. For the nine months ended September 30, 2021, restructuring charges comprised $ 1 million of accelerated depreciation of certain technology systems driven by efforts to enhance our technological capabilities and $ 1 million of severance and other costs. The pre-tax charges discussed above are reported in “Restructuring charges” in the accompanying consolidated statements of operations and comprehensive income. As of December 31, 2021, there were less than $ 1 million of restructuring charges accrued, which were paid or otherwise settled during the nine months ended September 30, 2022. As of September 30, 2022, there were $ 2 million in accrued restructuring charges in the accompanying condensed consolidated statements of financial position. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 8. Commitments and Contingencies Accruals for home service plan claims are made using internal actuarial projections, which are based on current claims and historical claims experience. Accruals are established based on estimates of the ultimate cost to settle claims. Home service plan claims take approximately three months to settle, on average, and substantially all claims are settled within six months of incurrence. The amount of time required to settle a claim can vary based on a number of factors, including whether a replacement is ultimately required. In addition to our estimates, we engage a third-party actuary to perform an accrual analysis utilizing generally accepted actuarial methods that incorporate cumulative historical claims experience and information provided by us. We regularly review our estimates of claims costs along with the third-party analysis and adjust our estimates when appropriate. We believe the use of actuarial methods to account for these liabilities provides a consistent and effective way to measure these judgmental accruals. We have certain liabilities with respect to existing or potential claims, lawsuits and other proceedings. We accrue for these liabilities when it is probable that future costs will be incurred and such costs can be reasonably estimated. Any resulting adjustments, which could be material, are recorded in the period the adjustments are identified. Due to the nature of our business activities, we are also at times subject to pending and threatened legal and regulatory actions that arise out of the ordinary course of business. In the opinion of management, based in part upon advice of legal counsel, the disposition of any such matters is not expected, individually or in the aggregate, to have a material adverse effect on our business, financial position, results of operations or cash flows. However, the results of legal actions cannot be predicted with certainty. Therefore, it is possible that our business, financial position, results of operations or cash flows could be materially adversely affected in any particular period by the unfavorable resolution of one or more legal actions. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2022 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | Note 9. Stock-Based Compensation We recognized stock-based compensation expense of $ 5 million ($ 4 million, net of tax) for each of the three-month periods ended September 30, 2022 and 2021 and $ 17 million ($ 15 million, net of tax) and $ 19 million ($ 14 million, net of tax) for the nine months ended September 30, 2022 and 2021, respectively. These charges are included in Selling and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive income. A summary of awards granted under the Omnibus Plan during the nine months ended September 30, 2022 is presented below: Number of Weighted Avg. Weighted Avg. Weighted Avg. Awards Exercise Grant Date Vesting Granted Price Fair Value Period Stock options 568,623 28.64 14.54 4.00 Performance options (1) 272,503 24.74 11.50 4.00 Restricted stock units 1,189,141 27.96 3.00 Performance shares (2) 285,801 28.03 3.00 _____________________________ (1) The number of performance options granted during the nine months ended September 30, 2022 represents the target value of the awards. The performance options contain a market condition that is based on our share price target, and the ultimate number of performance options to be earned depends on the achievement of this market condition. (2) The number of performance shares granted during the nine months ended September 30, 2022 represents the target value of the awards. The performance shares contain a performance condition that is based on our revenue target, and the ultimate number of performance shares to be earned depends on the achievement of this performance condition. As of September 30, 2022 , there was $ 43 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options, restricted stock units (“RSUs”), performance shares and restricted stock awards (“RSAs”). These remaining costs are expected to be recognized over a weighted-average period of 2.29 years. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2022 | |
Long-Term Debt [Abstract] | |
Long-Term Debt | Note 10. Long-Term Debt Long-term debt is summarized in the following table: As of September 30, December 31, (In millions) 2022 2021 Term Loan A maturing in 2026 (1) $ 242 $ 252 Term Loan B maturing in 2028 (2) 371 373 Revolving Credit Facility maturing in 2026 (3) — — Less current portion ( 17 ) ( 17 ) Total long-term debt $ 596 $ 608 _______________________________ (1) As of September 30, 2022 , and December 31, 2021, each presented net of $ 2 million in unamortized debt issuance costs. (2) As of September 30, 2022 , and December 31, 2021, each presented net of $ 3 million in unamortized debt issuance costs and $ 2 million in unamortized original issue discount. (3) As of September 30, 2022, there were $ 2 million of letters of credit outstanding under our $ 250 million Revolving Credit Facility. The letters of credit are posted in lieu of cash to satisfy regulatory requirements in certain states in which we operate. The Credit Agreement contains covenants that limit or restrict our ability, including the ability of certain of our subsidiaries, to incur additional indebtedness, repurchase debt, incur liens, sell assets, make certain payments (including dividends) and enter into transactions with affiliates; therefore, from time to time, our ability to draw on the Revolving Credit Facility may be limited. As of September 30, 2022, the available borrowing capacity under the Revolving Credit Facility was limited by the applicable consolidated first lien leverage ratio contained in the Credit Agreement to $ 199 million. Scheduled Long-term Debt Payments As of September 30, 2022, future scheduled long - term debt payments are $ 4 million for the remainder of 2022, $ 17 million for each of the years ending December 31, 2023 through 2025, $ 205 million for the year ending December 31, 2026 and $ 4 million for the year ending December 31, 2027. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Sep. 30, 2022 | |
Supplemental Cash Flow Information [Abstract] | |
Supplemental Cash Flow Information | Note 11. Supplemental Cash Flow Information Supplemental information relating to the accompanying condensed consolidated statements of cash flows is presented in the following table: Nine Months Ended September 30, (In millions) 2022 2021 Cash paid for (received from): Interest expense $ 21 $ 39 Income tax payments, net of refunds 20 29 Interest income ( 1 ) ( 1 ) |
Comprehensive Income (Loss)
Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2022 | |
Comprehensive Income (Loss) [Abstract] | |
Comprehensive Income (Loss) | Note 12. Comprehensive Income (Loss) Comprehensive income (loss), which includes net income (loss) and unrealized gain (loss) on derivative instruments, is disclosed in the accompanying condensed consolidated statements of operations and comprehensive income and condensed consolidated statements of changes in equity. The following tables summarize the activity in AOCI, net of the related tax effects. Unrealized Loss (In millions) on Derivatives Total Balance as of December 31, 2021 $ ( 18 ) $ ( 18 ) Other comprehensive income before reclassifications: Pre-tax amount 29 28 Tax provision 6 6 After-tax amount 22 22 Amounts reclassified from accumulated other comprehensive income (1) 4 4 Net current period other comprehensive income 27 26 Balance as of September 30, 2022 $ 8 $ 8 Balance as of December 31, 2020 $ ( 33 ) $ ( 33 ) Other comprehensive income before reclassifications: Pre-tax amount 5 5 Tax provision 1 1 After-tax amount 4 4 Amounts reclassified from accumulated other comprehensive income (1) 6 6 Net current period other comprehensive income 10 10 Balance as of September 30, 2021 $ ( 24 ) $ ( 24 ) ___________________________________ (1) Amounts are net of tax. See reclassifications out of AOCI below for further details. Reclassifications out of AOCI included the following components. Amounts Reclassified from Accumulated Other Comprehensive Income (Loss) Nine Months Ended September 30, Condensed Consolidated Statements of (In millions) 2022 2021 Operations and Comprehensive Income Location Loss on interest rate swap contract $ ( 5 ) $ ( 8 ) Interest expense Impact of income taxes 1 2 Provision for income taxes Total reclassifications related to derivatives $ ( 4 ) $ ( 6 ) Total reclassifications for the period $ ( 4 ) $ ( 6 ) |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2022 | |
Derivative Financial Instruments [Abstract] | |
Derivative Financial Instruments | Note 13. Derivative Financial Instruments We currently use a derivative financial instrument to manage risks associated with changes in interest rates. We do not hold or issue derivative financial instruments for trading or speculative purposes. In designating derivative financial instruments as hedging instruments under accounting standards for derivative instruments, we formally document the relationship between the hedging instrument and the hedged item, as well as the risk management objective and strategy for the use of the hedging instrument. This documentation includes linking the derivatives to forecasted transactions. We assess at the time a derivative contract is entered into, and at least quarterly thereafter, whether the derivative item is effective in offsetting the projected cash flows of the associated forecasted transaction. We hedge the interest payments on a portion of our variable rate debt through the use of an interest rate swap agreement. Our interest rate swap contract is classified as a cash flow hedge, and, as such, it is recorded in the accompanying condensed consolidated statements of financial position as either an asset or liability at fair value, with changes in fair value recorded in AOCI. Cash flows related to the interest rate swap contract are classified as operating activities in the accompanying condensed consolidated statements of cash flows. The effective portion of the gain or loss on our interest rate swap contract is recorded in AOCI. These amounts are reclassified into earnings in the same period or periods during which the hedged forecasted debt interest settlement affects earnings. See Note 12 to the accompanying condensed consolidated financial statements for the effective portion of the gain or loss on derivative instruments recorded in AOCI and for the amounts reclassified out of AOCI and into earnings. As the underlying forecasted transactions occur during the next 12 months, the unrealized hedging gain in AOCI expected to be recognized in earnings is $ 3 million, net of tax, as of September 30, 2022 . The amounts that are ultimately reclassified into earnings will be based on actual interest rates at the time the positions are settled and may differ materially from the amount noted above. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Measurements [Abstract] | |
Fair Value Measurements | Note 14. Fair Value Measurements We estimate fair value at a price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market for the asset or liability. The valuation techniques require inputs that the business categorizes using a three-level hierarchy, from highest to lowest level of observable inputs, as follows: unadjusted quoted prices for identical assets or liabilities in active markets ("Level 1"); direct or indirect observable inputs, including quoted prices or other market data, for similar assets or liabilities in active markets or identical assets or liabilities in less active markets ("Level 2"); and unobservable inputs that require significant judgment for which there is little or no market data ("Level 3"). When multiple input levels are required for a valuation, we categorize the entire fair value measurement according to the lowest level of input that is significant to the measurement, even though we may have also utilized significant inputs that are more readily observable. The period-end carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued liabilities approximate fair value because of the short maturity of these instruments. The carrying amount of total debt was $ 613 million and $ 625 million, and the estimated fair value was $ 602 million and $ 630 million as of September 30, 2022 and December 31, 2021, respectively. The fair value of our debt is estimated based on available market prices for the same or similar instruments that are considered significant other observable inputs (Level 2) within the fair value hierarchy. The fair values presented reflect the amounts that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The fair value estimates presented in this report are based on information available to us as of September 30, 2022 and December 31, 2021. We value our interest rate swap contract using a forward interest rate curve obtained from a third-party market data provider. The fair value of the contract is the sum of the expected future settlements between the contract counterparties, discounted to present value. The expected future settlements are determined by comparing the contract interest rate to the expected forward interest rate as of each settlement date and applying the difference between the two rates to the notional amount of debt in the interest rate swap contract. We did not change our valuation techniques for measuring the fair value of any financial assets and liabilities during the nine months ended September 30, 2022 . Transfers between levels, if any, are recognized at the end of the reporting period. There were no transfers between levels during the nine months ended September 30, 2022 and 2021. The carrying amount and estimated fair value of our financial instruments that are recorded at fair value on a recurring basis are as follows: Estimated Fair Value Measurements (In millions) Statement of Financial Position Location Carrying Value Quoted Prices In Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of September 30, 2022: Financial Assets: Interest rate swap contract Prepaid expenses and other assets $ 4 $ — $ 4 $ — Other assets 6 — 6 — Total financial assets $ 10 $ — $ 10 $ — As of December 31, 2021: Financial Liabilities: Interest rate swap contract Other accrued liabilities $ 9 $ — $ 9 $ — Other long-term obligations 15 — 15 — Total financial liabilities $ 24 $ — $ 24 $ — |
Share Repurchase Program
Share Repurchase Program | 9 Months Ended |
Sep. 30, 2022 | |
Share Repurchase Program [Abstract] | |
Share Repurchase Program | Note 15. Share Repurchase Program On September 7, 2021, we announced a three-year repurchase authorization of up to $ 400 million of outstanding shares of our common stock over the three-year period from September 3, 2021 through September 3, 2024. Purchases of outstanding shares are as follows: Three Months Ended Nine Months Ended September 30, September 30, (In millions, except per share data) 2022 2021 2022 2021 Number of shares purchased — 0.5 1.9 0.5 Average price paid per share (1) $ — $ 46.11 $ 30.51 $ 46.11 Cost of shares purchased $ — $ 25 $ 59 $ 25 ________________________________ (1) The average price paid per share is calculated on a trade date basis and excludes commissions. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 16. Earnings Per Share Basic earnings per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted-average number of shares of common stock outstanding during the period, increased to include the number of shares of common stock that would have been outstanding had potentially dilutive shares of common stock been issued. The dilutive effect of stock options, RSUs , performance shares and RSAs are reflected in diluted earnings per share by applying the treasury stock method. Basic and diluted earnings per share are calculated as follows: Three Months Ended Nine Months Ended September 30, September 30, (In millions, except per share data) 2022 2021 2022 2021 Net Income $ 28 $ 76 $ 63 $ 122 Weighted-average common shares outstanding 81.5 85.5 82.0 85.5 Effect of dilutive securities: RSUs (1) 0.2 0.2 0.1 0.2 Stock options (2) — 0.2 — 0.2 Weighted-average common shares outstanding - assuming dilution 81.6 85.9 82.1 85.9 Basic earnings per share $ 0.34 $ 0.89 $ 0.77 $ 1.42 Diluted earnings per share $ 0.34 $ 0.89 $ 0.77 $ 1.42 ___________________________________ (1) RSUs of 0.8 million and 0.3 million shares for the three months ended September 30, 2022 and 2021, respectively, and 1.0 million and 0.3 million shares for the nine months ended September 30, 2022 and 2021, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive. (2) Options to purchase 1.6 million and 0.7 million shares for the three months ended September 30, 2022 and 2021 , respectively, and 1.4 million and 0.6 million shares for the nine months ended September 30, 2022 and 2021, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue [Abstract] | |
Disaggregation of Revenue from Contracts With Customers | Three Months Ended Nine Months Ended September 30, September 30, (In millions) 2022 2021 2022 2021 Renewals $ 356 $ 328 $ 949 $ 867 Real estate (1) 51 73 153 207 Direct-to-consumer (1) 64 59 176 157 Other 13 11 44 31 Total $ 484 $ 471 $ 1,322 $ 1,263 _____________________________ (1) First-year revenue only. |
Movement in Deferred Revenue | (In millions) Deferred Revenue Balance as of December 31, 2021 $ 155 Deferral of revenue 209 Recognition of deferred revenue ( 251 ) Balance as of September 30, 2022 $ 113 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets [Abstract] | |
Schedule of Other Intangible Asset Balances | As of September 30, 2022 As of December 31, 2021 (In millions) Gross Accumulated Amortization Net Gross Accumulated Amortization Net Trade names (1) $ 141 $ — $ 141 $ 141 $ — $ 141 Customer relationships 173 ( 172 ) — 173 ( 172 ) — Developed technology (2) 19 ( 12 ) 6 25 ( 12 ) 13 Other (3) 32 ( 31 ) 2 37 ( 32 ) 5 Total $ 364 $ ( 216 ) $ 149 $ 375 $ ( 216 ) $ 159 _____________________________ (1) Not subject to amortization. (2) Includes a net $ 3 million impairment relating to the Streem reporting unit, which comprises $ 6 million of gross cost and $ 4 million of accumulated amortization. (3) Includes a net $ 2 million impairment relating to the Streem reporting unit, which comprises $ 4 million of gross cost and $ 2 million of accumulated amortization. |
Schedule of Expected Amortization Expense for Intangible Assets | (In millions) 2022 (remainder) $ 1 2023 4 2024 2 2025 — 2026 — 2027 — Total $ 8 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Weighted Average Remaining Lease Term and Discount Rate | As of September 30, December 31, 2022 2021 Weighted-average remaining lease term (years) 8 9 Weighted-average discount rate 5.6 % 5.6 % |
Supplemental Cash Flow Related to Leases | Nine Months Ended September 30, (In millions) 2022 2021 Cash paid for amounts included in the measurement of lease liabilities $ 4 $ 4 Leased assets obtained in exchange for new lease liabilities — 6 |
Supplemental Balance Sheet Information Related to Leases | As of September 30, December 31, (In millions) 2022 2021 Other accrued liabilities $ 4 $ 4 Operating lease liabilities 16 19 Total operating lease liabilities $ 20 $ 23 |
Maturities of Lease Liabilities | (In millions) 2022 (remainder) $ 1 2023 (1) 4 2024 (1) 2 2025 (1) 1 2026 (1) 2 2027 2 Thereafter 10 Total lease payments 22 Less imputed interest ( 6 ) Total $ 16 _____________________________ (1) Each of the years ending December 31, 2023 through 2026 presented net of approximately $ 1 million of projected annual sublease income. |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Stock-Based Compensation [Abstract] | |
Summary of Awards Granted | Number of Weighted Avg. Weighted Avg. Weighted Avg. Awards Exercise Grant Date Vesting Granted Price Fair Value Period Stock options 568,623 28.64 14.54 4.00 Performance options (1) 272,503 24.74 11.50 4.00 Restricted stock units 1,189,141 27.96 3.00 Performance shares (2) 285,801 28.03 3.00 _____________________________ (1) The number of performance options granted during the nine months ended September 30, 2022 represents the target value of the awards. The performance options contain a market condition that is based on our share price target, and the ultimate number of performance options to be earned depends on the achievement of this market condition. (2) The number of performance shares granted during the nine months ended September 30, 2022 represents the target value of the awards. The performance shares contain a performance condition that is based on our revenue target, and the ultimate number of performance shares to be earned depends on the achievement of this performance condition. |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Long-Term Debt [Abstract] | |
Schedule of Long-Term Debt | As of September 30, December 31, (In millions) 2022 2021 Term Loan A maturing in 2026 (1) $ 242 $ 252 Term Loan B maturing in 2028 (2) 371 373 Revolving Credit Facility maturing in 2026 (3) — — Less current portion ( 17 ) ( 17 ) Total long-term debt $ 596 $ 608 _______________________________ (1) As of September 30, 2022 , and December 31, 2021, each presented net of $ 2 million in unamortized debt issuance costs. (2) As of September 30, 2022 , and December 31, 2021, each presented net of $ 3 million in unamortized debt issuance costs and $ 2 million in unamortized original issue discount. (3) As of September 30, 2022, there were $ 2 million of letters of credit outstanding under our $ 250 million Revolving Credit Facility. The letters of credit are posted in lieu of cash to satisfy regulatory requirements in certain states in which we operate. The Credit Agreement contains covenants that limit or restrict our ability, including the ability of certain of our subsidiaries, to incur additional indebtedness, repurchase debt, incur liens, sell assets, make certain payments (including dividends) and enter into transactions with affiliates; therefore, from time to time, our ability to draw on the Revolving Credit Facility may be limited. As of September 30, 2022, the available borrowing capacity under the Revolving Credit Facility was limited by the applicable consolidated first lien leverage ratio contained in the Credit Agreement to $ 199 million. |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of Supplemental Information Relating to the Accompanying Condensed Consolidated Statements of Cash Flows | Nine Months Ended September 30, (In millions) 2022 2021 Cash paid for (received from): Interest expense $ 21 $ 39 Income tax payments, net of refunds 20 29 Interest income ( 1 ) ( 1 ) |
Comprehensive Income (Loss) (Ta
Comprehensive Income (Loss) (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Comprehensive Income (Loss) [Abstract] | |
Summary of the Activity in AOCI, Net of the Related Tax Effects | Unrealized Loss (In millions) on Derivatives Total Balance as of December 31, 2021 $ ( 18 ) $ ( 18 ) Other comprehensive income before reclassifications: Pre-tax amount 29 28 Tax provision 6 6 After-tax amount 22 22 Amounts reclassified from accumulated other comprehensive income (1) 4 4 Net current period other comprehensive income 27 26 Balance as of September 30, 2022 $ 8 $ 8 Balance as of December 31, 2020 $ ( 33 ) $ ( 33 ) Other comprehensive income before reclassifications: Pre-tax amount 5 5 Tax provision 1 1 After-tax amount 4 4 Amounts reclassified from accumulated other comprehensive income (1) 6 6 Net current period other comprehensive income 10 10 Balance as of September 30, 2021 $ ( 24 ) $ ( 24 ) ___________________________________ (1) Amounts are net of tax. See reclassifications out of AOCI below for further details. |
Schedule of Reclassifications Out of Accumulated Other Comprehensive Income (Loss) | Amounts Reclassified from Accumulated Other Comprehensive Income (Loss) Nine Months Ended September 30, Condensed Consolidated Statements of (In millions) 2022 2021 Operations and Comprehensive Income Location Loss on interest rate swap contract $ ( 5 ) $ ( 8 ) Interest expense Impact of income taxes 1 2 Provision for income taxes Total reclassifications related to derivatives $ ( 4 ) $ ( 6 ) Total reclassifications for the period $ ( 4 ) $ ( 6 ) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Measurements [Abstract] | |
Schedule of the Carrying Amount and Estimated Fair Value of the Company's Financial Instruments that are Recorded at Fair Value on a Recurring Basis | Estimated Fair Value Measurements (In millions) Statement of Financial Position Location Carrying Value Quoted Prices In Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) As of September 30, 2022: Financial Assets: Interest rate swap contract Prepaid expenses and other assets $ 4 $ — $ 4 $ — Other assets 6 — 6 — Total financial assets $ 10 $ — $ 10 $ — As of December 31, 2021: Financial Liabilities: Interest rate swap contract Other accrued liabilities $ 9 $ — $ 9 $ — Other long-term obligations 15 — 15 — Total financial liabilities $ 24 $ — $ 24 $ — |
Share Repurchase Program (Table
Share Repurchase Program (Table) | 9 Months Ended |
Sep. 30, 2022 | |
Share Repurchase Program [Abstract] | |
Purchase Of Outstanding Shares | Three Months Ended Nine Months Ended September 30, September 30, (In millions, except per share data) 2022 2021 2022 2021 Number of shares purchased — 0.5 1.9 0.5 Average price paid per share (1) $ — $ 46.11 $ 30.51 $ 46.11 Cost of shares purchased $ — $ 25 $ 59 $ 25 ________________________________ (1) The average price paid per share is calculated on a trade date basis and excludes commissions. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share | Three Months Ended Nine Months Ended September 30, September 30, (In millions, except per share data) 2022 2021 2022 2021 Net Income $ 28 $ 76 $ 63 $ 122 Weighted-average common shares outstanding 81.5 85.5 82.0 85.5 Effect of dilutive securities: RSUs (1) 0.2 0.2 0.1 0.2 Stock options (2) — 0.2 — 0.2 Weighted-average common shares outstanding - assuming dilution 81.6 85.9 82.1 85.9 Basic earnings per share $ 0.34 $ 0.89 $ 0.77 $ 1.42 Diluted earnings per share $ 0.34 $ 0.89 $ 0.77 $ 1.42 ___________________________________ (1) RSUs of 0.8 million and 0.3 million shares for the three months ended September 30, 2022 and 2021, respectively, and 1.0 million and 0.3 million shares for the nine months ended September 30, 2022 and 2021, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive. (2) Options to purchase 1.6 million and 0.7 million shares for the three months ended September 30, 2022 and 2021 , respectively, and 1.4 million and 0.6 million shares for the nine months ended September 30, 2022 and 2021, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive. |
Basis of Presentation (Narrativ
Basis of Presentation (Narrative) (Details) | 9 Months Ended |
Sep. 30, 2022 item state | |
Number of active home service plans | 2,200,000 |
Number of States in which Entity Operates | state | 50 |
Minimum [Member] | |
Number of systems or appliances covered under service plans | 20 |
Revenue (Narrative) (Details)
Revenue (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Revenue [Abstract] | |||||
Capitalized Contract Cost, Net | $ 17,000,000 | $ 17,000,000 | $ 16,000,000 | ||
Capitalized Contract Cost, Amortization | 6,000,000 | $ 5,000,000 | 15,000,000 | $ 15,000,000 | |
Capitalized Contract Cost, Impairment Loss | 0 | $ 0 | 0 | $ 0 | |
Deferred revenue | 113,000,000 | $ 113,000,000 | $ 155,000,000 | ||
Contracts with customers, period | 1 year | ||||
Contract asset | 65,000,000 | $ 65,000,000 | |||
Revenue recognized | $ 33,000,000 | $ 155,000,000 |
Revenue (Disaggregation of Reve
Revenue (Disaggregation of Revenue from Contracts with Customers) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Disaggregation of Revenue [Line Items] | |||||
Reportable segment revenues | $ 484 | $ 471 | $ 1,322 | $ 1,263 | |
Renewals [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Reportable segment revenues | 356 | 328 | 949 | 867 | |
Real Estate [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Reportable segment revenues | [1] | 51 | 73 | 153 | 207 |
Direct-To-Consumer [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Reportable segment revenues | [1] | 64 | 59 | 176 | 157 |
Revenue, Other [Member] | |||||
Disaggregation of Revenue [Line Items] | |||||
Reportable segment revenues | $ 13 | $ 11 | $ 44 | $ 31 | |
[1] First-year revenue only. |
Revenue (Movement in Deferred R
Revenue (Movement in Deferred Revenue) (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Revenue [Abstract] | |
Balance as of December 31, 2021 | $ 155 |
Deferral of revenue | 209 |
Recognition of deferred revenue | (251) |
Balance as of September 30, 2022 | $ 113 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Goodwill and Intangible Assets [Abstract] | |||||
Goodwill | $ 503,000,000 | $ 503,000,000 | $ 512,000,000 | ||
Impairment charges | 14,000,000 | ||||
Goodwill impairment charges | 9,000,000 | $ 0 | $ 0 | ||
Intangible asset impairment charges | 5,000,000 | ||||
Accumulated impairment loss | $ 0 | ||||
Amortization expense | $ 2,000,000 | $ 2,000,000 | $ 6,000,000 | $ 8,000,000 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Schedule of Other Intangible Asset Balances) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | ||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | ||||
Gross | $ 364 | $ 364 | $ 375 | |
Accumulated Amortization | (216) | (216) | (216) | |
Net | 149 | 149 | 159 | |
Impairment charges | 14 | |||
Customer Relationships [Member] | ||||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | ||||
Gross | 173 | 173 | 173 | |
Accumulated Amortization | (172) | (172) | (172) | |
Developed Technology [Member] | ||||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | ||||
Gross | [1] | 19 | 19 | 25 |
Accumulated Amortization | [1] | (12) | (12) | (12) |
Net | [1] | 6 | 6 | 13 |
Developed Technology [Member] | Streem Reporting Unit [Member] | ||||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | ||||
Gross | 6 | 6 | 6 | |
Accumulated Amortization | 4 | 4 | 4 | |
Impairment charges | 3 | 3 | ||
Other [Member] | ||||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | ||||
Gross | [2] | 32 | 32 | 37 |
Accumulated Amortization | [2] | (31) | (31) | (32) |
Net | [2] | 2 | 2 | 5 |
Other [Member] | Streem Reporting Unit [Member] | ||||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | ||||
Gross | 4 | 4 | 4 | |
Accumulated Amortization | 2 | 2 | 2 | |
Impairment charges | 2 | 2 | ||
Trade Names [Member] | ||||
Finite Lived and Indefinite Lived Intangible Assets by Major Class [Line Items] | ||||
Gross | [3] | 141 | 141 | 141 |
Net | [3] | $ 141 | $ 141 | $ 141 |
[1] Includes a net $ 3 million impairment relating to the Streem reporting unit, which comprises $ 6 million of gross cost and $ 4 million of accumulated amortization. Includes a net $ 2 million impairment relating to the Streem reporting unit, which comprises $ 4 million of gross cost and $ 2 million of accumulated amortization. Not subject to amortization. |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Schedule of Expected Amortization Expense for Intangible Assets) (Details) $ in Millions | Sep. 30, 2022 USD ($) |
Goodwill and Intangible Assets [Abstract] | |
2022 (remainder) | $ 1 |
2023 | 4 |
2024 | 2 |
2025 | |
2026 | |
2027 | |
Total | $ 8 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Lessee, Lease, Description [Line Items] | ||||
Leases, Renewal Term | 5 years | |||
Operating lease expense | $ 1,000,000 | $ 1,000,000 | $ 3,000,000 | $ 3,000,000 |
Operating lease, impairment loss | $ 0 | $ 11,000,000 | ||
Maximum [Member] | ||||
Lessee, Lease, Description [Line Items] | ||||
Leases, Remaining Lease Term Years | 12 years | |||
Minimum [Member] | ||||
Lessee, Lease, Description [Line Items] | ||||
Leases, Remaining Lease Term Years | 1 year |
Leases (Weighted Average Remain
Leases (Weighted Average Remaining Lease Term and Discount Rate) (Details) | Sep. 30, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Weighted-average remaining lease term (years) | 8 years | 9 years |
Weighted-average discount rate | 5.60% | 5.60% |
Leases (Supplemental Cash Flow
Leases (Supplemental Cash Flow Related to Leases) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 4 | $ 4 |
Leased assets obtained in exchange for new lease liabilities | $ 6 |
Leases (Supplemental Balance Sh
Leases (Supplemental Balance Sheet Information Related to Leases) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Other accrued liabilities | $ 4 | $ 4 |
Operating lease liabilities | 16 | 19 |
Total operating lease liabilities | $ 20 | $ 23 |
Leases (Maturities of Lease Lia
Leases (Maturities of Lease Liabilities) (Details) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 USD ($) | ||
Leases [Abstract] | ||
2022 (remainder) | $ 1 | |
2023 | 4 | [1] |
2024 | 2 | [1] |
2025 | 1 | [1] |
2026 | 2 | [1] |
2027 | 2 | |
Thereafter | 10 | |
Total lease payments | 22 | |
Less imputed interest | (6) | |
Total | 16 | |
Projected annual sublease income | $ 1 | |
[1] Each of the years ending December 31, 2023 through 2026 presented net of approximately $ 1 million of projected annual sublease income. |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Taxes [Abstract] | ||||
Effective tax rate on income from continuing operations (as a percent) | 28.20% | 24.30% | 26.50% | 24.40% |
Restructuring Charges (Narrativ
Restructuring Charges (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 5,000,000 | $ 18,000,000 | $ 2,000,000 | ||
Restructuring charges, net of tax | 4,000,000 | 13,000,000 | 1,000,000 | ||
Operating lease, impairment loss | 0 | 11,000,000 | |||
Severance Costs | 3,000,000 | 5,000,000 | 1,000,000 | ||
Accelerated depreciation related to disposal of technology systems | $ 1,000,000 | ||||
Restructuring charges accrued | $ 2,000,000 | $ 2,000,000 | |||
Selling, General and Administrative Expenses [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Severance cost related to reduction in workforce percentage | 7% | 7% | |||
Workforce Reduction [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Severance Costs | $ 2,000,000 | $ 2,000,000 | |||
Maximum [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Restructuring charges | $ 1,000,000 | ||||
Restructuring charges, net of tax | $ 1,000,000 | ||||
Restructuring charges accrued | $ 1,000,000 | ||||
Developed Technology [Member] | |||||
Restructuring Cost and Reserve [Line Items] | |||||
Impairment charges | $ 2,000,000 | $ 2,000,000 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Stock-Based Compensation [Abstract] | ||||
Stock-based compensation expense | $ 5 | $ 5 | $ 17 | $ 19 |
Stock-based compensation expense, net of tax | 4 | $ 4 | 15 | $ 14 |
Total unrecognized compensation costs related to non-vested stock options, restricted share units and performance shares | $ 43 | $ 43 | ||
Weighted-average period of recognition of stock-based compensation cost | 2 years 3 months 14 days |
Stock-Based Compensation (Summa
Stock-Based Compensation (Summary of Awards Granted) (Details) | 9 Months Ended | |
Sep. 30, 2022 $ / shares shares | ||
Number of Awards Granted | ||
Granted (in shares) | shares | 568,623 | |
Weighted Avg. Exercise Price | ||
Granted (in dollars per share) | $ 28.64 | |
Weighted Average Remaining Contractual Term (in years) | ||
Granted, Weighted Ave Vesting Period | 4 years | |
Granted, Weighted Average Grant Date Fair Value (in dollars per share) | $ 14.54 | |
Performance Options [Member] | ||
Weighted Average Remaining Contractual Term (in years) | ||
Granted (in shares) | shares | 272,503 | [1] |
Grants, Weighted Average Exercise Price (in dollars per share) | $ 24.74 | [1] |
Granted, Weighted Average Grant Date Fair Value (in dollars per share) | $ 11.50 | [1] |
Weighted Avg. Vesting Period | 4 years | [1] |
RSU [Member] | ||
Weighted Average Remaining Contractual Term (in years) | ||
Granted (in shares) | shares | 1,189,141 | |
Granted, Weighted Average Grant Date Fair Value (in dollars per share) | $ 27.96 | |
Weighted Avg. Vesting Period | 3 years | |
Performance Shares [Member] | ||
Weighted Average Remaining Contractual Term (in years) | ||
Granted (in shares) | shares | 285,801 | [2] |
Granted, Weighted Average Grant Date Fair Value (in dollars per share) | $ 28.03 | [2] |
Weighted Avg. Vesting Period | 3 years | [2] |
[1] The number of performance options granted during the nine months ended September 30, 2022 represents the target value of the awards. The performance options contain a market condition that is based on our share price target, and the ultimate number of performance options to be earned depends on the achievement of this market condition. The number of performance shares granted during the nine months ended September 30, 2022 represents the target value of the awards. The performance shares contain a performance condition that is based on our revenue target, and the ultimate number of performance shares to be earned depends on the achievement of this performance condition. |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) - Other [Member] $ in Millions | Sep. 30, 2022 USD ($) |
Debt Instrument [Line Items] | |
Scheduled long-term debt payments, remainder of 2022 | $ 4 |
Scheduled long-term debt payments, 2023 | 17 |
Scheduled long-term debt payments, 2024 | 17 |
Scheduled long-term debt payments, 2025 | 17 |
Scheduled long-term debt payments, 2026 | 205 |
Scheduled long-term debt payments, 2027 | $ 4 |
Long-Term Debt (Schedule of Lon
Long-Term Debt (Schedule of Long-Term Debt) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | |
Long-term debt [Line Items] | |||
Less current portion | $ (17) | $ (17) | |
Total long-term debt | 596 | 608 | |
Term Loan A Maturing In 2026 [Member] | |||
Long-term debt [Line Items] | |||
Long-term debt | [1] | 242 | 252 |
Unamortized debt issuance costs | 2 | 2 | |
Term Loan B Maturing In 2028 [Member] | |||
Long-term debt [Line Items] | |||
Long-term debt | [2] | 371 | 373 |
Unamortized debt issuance costs | 3 | 3 | |
Unamortized original issue discount | 2 | 2 | |
Revolving Credit Facility Maturing In 2026 [Member] | |||
Long-term debt [Line Items] | |||
Long-term debt | [3] | ||
Letters of credit outstanding | 2 | ||
Maximum borrowing capacity | 250 | ||
Available borrowing capacity | $ 199 | ||
[1] As of September 30, 2022 , and December 31, 2021, each presented net of $ 2 million in unamortized debt issuance costs. As of September 30, 2022 , and December 31, 2021, each presented net of $ 3 million in unamortized debt issuance costs and $ 2 million in unamortized original issue discount. As of September 30, 2022, there were $ 2 million of letters of credit outstanding under our $ 250 million Revolving Credit Facility. The letters of credit are posted in lieu of cash to satisfy regulatory requirements in certain states in which we operate. The Credit Agreement contains covenants that limit or restrict our ability, including the ability of certain of our subsidiaries, to incur additional indebtedness, repurchase debt, incur liens, sell assets, make certain payments (including dividends) and enter into transactions with affiliates; therefore, from time to time, our ability to draw on the Revolving Credit Facility may be limited. As of September 30, 2022, the available borrowing capacity under the Revolving Credit Facility was limited by the applicable consolidated first lien leverage ratio contained in the Credit Agreement to $ 199 million. |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Schedule of Supplemental Information Relating to the Accompanying Condensed Consolidated Statements of Cash Flows) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Cash paid for (received from): | ||
Interest expense | $ 21 | $ 39 |
Income tax payments, net of refunds | 20 | 29 |
Interest income | $ (1) | $ (1) |
Comprehensive Income (Loss) (Su
Comprehensive Income (Loss) (Summary of the Activity in AOCI, Net of the Related Tax Effects) (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance at the beginning of period | $ (18) | $ (33) | |
Other comprehensive income before reclassifications: | |||
Pre-tax amount | 28 | 5 | |
Tax provision | 6 | 1 | |
After-tax amount | 22 | 4 | |
Amounts reclassified from accumulated other comprehensive income | [1] | 4 | 6 |
Net current period other comprehensive income | 26 | 10 | |
Balance at the end of period | 8 | (24) | |
Unrealized Loss On Derivatives [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance at the beginning of period | (18) | (33) | |
Other comprehensive income before reclassifications: | |||
Pre-tax amount | 29 | 5 | |
Tax provision | 6 | 1 | |
After-tax amount | 22 | 4 | |
Amounts reclassified from accumulated other comprehensive income | [1] | 4 | 6 |
Net current period other comprehensive income | 27 | 10 | |
Balance at the end of period | $ 8 | $ (24) | |
[1] Amounts are net of tax. See reclassifications out of AOCI below for further details. |
Comprehensive Income (Loss) (Sc
Comprehensive Income (Loss) (Schedule of Reclassifications Out of Accumulated Other Comprehensive Income (Loss)) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Interest expense | $ (8) | $ (7) | $ (22) | $ (32) |
Provision for income taxes | (11) | (25) | (23) | (39) |
Net Income | $ 28 | $ 76 | 63 | 122 |
Amount Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Net Income | (4) | (6) | ||
Unrealized Loss On Derivatives [Member] | Amount Reclassified From Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||
Interest expense | (5) | (8) | ||
Provision for income taxes | 1 | 2 | ||
Net Income | $ (4) | $ (6) |
Derivative Financial Instrume_2
Derivative Financial Instruments (Narrative) (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2022 USD ($) | |
Derivative Financial Instruments [Abstract] | |
Hedging loss in accumulated other comprehensive income expected to be recognized in earnings, net of tax | $ 3 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Fair Value Measurements [Abstract] | |||
Carrying amount of total debt | $ 613,000,000 | $ 625,000,000 | |
Fair value of total debt | 602,000,000 | $ 630,000,000 | |
Transfers between levels during period | $ 0 | $ 0 |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule of the Carrying Amount and Estimated Fair Value of the Company's Financial Instruments that are Recorded at Fair Value on a Recurring Basis) (Details) - Recurring [Member] - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Carrying Value [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | $ 10 | |
Total financial liabilities | $ 24 | |
Carrying Value [Member] | Other Accrued Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Liabilites | 9 | |
Carrying Value [Member] | Other Long-Term Obligation [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Liabilites | 15 | |
Carrying Value [Member] | Prepaid Expenses And Other Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Assets | 4 | |
Carrying Value [Member] | Other Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Assets | 6 | |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total financial assets | 10 | |
Total financial liabilities | 24 | |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | Other Accrued Liabilities [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Liabilites | 9 | |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | Other Long-Term Obligation [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Liabilites | $ 15 | |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | Prepaid Expenses And Other Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Assets | 4 | |
Estimated Fair Value [Member] | Significant Other Observable Inputs (Level 2) [Member] | Other Assets [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial Assets | $ 6 |
Share Repurchase Program (Narra
Share Repurchase Program (Narrative) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 07, 2021 | |
Share Repurchase Program [Abstract] | ||
Repurchase authorized amount | $ 400 | |
Repurchase authorized period | 3 years |
Share Repurchase Program (Purch
Share Repurchase Program (Purchase of Outstanding Shares) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Share Repurchase Program [Abstract] | ||||
Number of shares purchased | 0.5 | 1.9 | 0.5 | |
Average price paid per share | [1] | $ 46.11 | $ 30.51 | $ 46.11 |
Cost of share purchased | $ 25 | $ 59 | $ 25 | |
[1] The average price paid per share is calculated on a trade date basis and excludes commissions. |
Earnings Per Share (Schedule of
Earnings Per Share (Schedule of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | ||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Net income | $ 28 | $ 76 | $ 63 | $ 122 | |
Weighted-average common shares outstanding | 81.5 | 85.5 | 82 | 85.5 | |
Weighted-average common shares outstanding - assuming dilution | 81.6 | 85.9 | 82.1 | 85.9 | |
Basic earnings per share (in dollars per share) | $ 0.34 | $ 0.89 | $ 0.77 | $ 1.42 | |
Diluted earnings per share (in dollars per share) | $ 0.34 | $ 0.89 | $ 0.77 | $ 1.42 | |
RSU [Member] | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Effect of dilutive securities | [1] | 0.2 | 0.2 | 0.1 | 0.2 |
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 0.8 | 0.3 | 1 | 0.3 | |
Stock Options [Member] | |||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||
Effect of dilutive securities | [2] | 0.2 | 0.2 | ||
Antidilutive securities excluded from computation of diluted earnings per share (in shares) | 1.6 | 0.7 | 1.4 | 0.6 | |
[1] RSUs of 0.8 million and 0.3 million shares for the three months ended September 30, 2022 and 2021, respectively, and 1.0 million and 0.3 million shares for the nine months ended September 30, 2022 and 2021, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive. Options to purchase 1.6 million and 0.7 million shares for the three months ended September 30, 2022 and 2021 , respectively, and 1.4 million and 0.6 million shares for the nine months ended September 30, 2022 and 2021, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive. |