FTDR - Earnings call transcript Q1 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Ladies and gentlemen, welcome to Frontdoor's First Quarter 2024 Earnings Call. Today's call is being recorded and broadcast on the Internet. Beginning today's call is Matt Davis, Vice President of Investor Relations and Treasurer, and he will introduce the other speakers on the call. At this time, we'll begin today's call. Please go ahead, Mr. Davis.

Matt Davis

morning, XXXX thank Earnings Good Frontdoor's for operator. Quarter First Conference you, everyone, you and joining Thank Call.

at Ross.The Chief Joining and me be website, on Officer, used Frontdoor's be call that of Frontdoor's the Chief Chairman on located Jessica Financial found Executive Officer, during which slide today Bill investors.frontdoorhome.com. Cobb; will are presentation press release Frontdoor's Investor can section the today's and is Relations

the results the are uncertainties that this May factors I'd by to risks Factors our filings such statements.All from for are and update As statements, actual you company's stated section which those risk like of forward-looking detail contain presentation, Slide in today. to various result uncertainties, measures to in subject the statements and a on These a to today's the statements as call financial as future certain any more new SEC. forward-looking detailed related as statements.These reference undertakes materially company required Risk call. information, X to the and differ explained the filings also could whether or in discussed to are our with and may cause of no webcast events except of made of and discussion here refer throughout forward-looking non-GAAP forward-looking Please otherwise.We X, today, law, will remind statements risks obligation

financial Cobb the call now GAAP order will financial the comments. release measures over better press We presentation to have in included opening definitions comparable to Bill? understanding turn to you and in to the these these of financial in appendix Bill our assist and measures of for performance.I terms their most reconciliations non-GAAP our

William Cobb

Frontdoor, to record another great to Inc. as you much, extremely everybody. in and we hello off start results. delivered quarter Matt Davis, operate of a are well, continues very XXXX again, Thank and we

X% result our quarter all-time grew a increased full EBITDA X, to remains see XXXX on million. EBITDA an our as customer $XX you basis points of can continue top Adjusted Slide to base. of are XX%. first XXX margin we high to $XXX to As revenue outlook.So, on our And million.Gross XX% performance, margin we the adjusted expectations growing exceed first priority financial strong increasing side, quarter year our rose while

this front. be Demand has for cause issue.The Warranties market down clear temporary main cyclical estate. has challenging been real lower some up of view right due been as Home Let's conditions, but to a we demand

products to had have At mortgage last recently also tight. rising not to extremely to the real million to declined over shift in before, I've million part high. over seller has as as our significantly the X-year reached to $X power due in in only sell it same rates, a our opportunities existing is fewer This time, inventory years. the and the products.This part just estate of was existing existing As home which sell of said sales, today, homes several X has we but process significant been number XXXX the home a from homes resisted limited we has

that this and of cash half real is the warranty for ago, profitability than from true growth, impact we category. sales the years result, less revenue this channel continues they count, were a of what rest see, customer X estate As are our and flows.And, our everything home to

demand. to we also while seen are tangible the waiting So, where estate see eventually the still to turning real have direct-to-consumer will that come optimistic channel we turnaround.Now, proof back, on lower are more the channel we

began a homeowners. on selling year ago This historically story, directly decline when Home our we to about COVID, item estate powerful real about channel. marketing sales.However, the marketing only we you to been consumer For new sold years It between strong and was through our a a us those after spend for Warranties XX of growth a have we was seeing saw correlation primarily in as started demand.

indicator the term past X% a for 'Home this, this Google As Warranty' of searches down recent were March.

We have something understanding hard easily some that consumers are to we other change, insurance things and confuse known here products. Warranties. digging or research.First, have homeowners learned into They with a of from really you needed time the consumer Home

resonated of several a of and consumers by back has warranty, behavior consumers will in their go in echoed want like consumer them companies This consumers our we as shortly. they've Second, happiness.Third, not of environment is of and done higher morning, a warranties.I freedom this this have feel and higher-level by inflation who of competition.Additionally, mind, of like we recently providers, really home peace has temporary on home view We with been larger we have consumer to been result mentioned our budget groups stand has not from we realized and focus are action what impacted pulling by out this corner. to rising someone the as take as we been convenience as spending. grounded addressing enough call the have to out needed protection sameness got other What from we costs. when been spending among benefits reset are a as category prioritizing to defined macro sea into competition. the The break a the how

for continues renewals, spot to which us. bright turning be a Now, to

of our grew rate For retention the first XX.X%. quarter to XXXX,

with part minimize pricing improve preferred at dynamic contractors.This utilization there service, to is team of the customers a in more of first customer remains expanding increasing process, number of program, coming home more which costs our XX% continuing dual consumers team's new do effort from the lowering know a that a which We and to range super And our accomplishments to customer perform as likely their is the initiatives.But those While a been this our while experience well.Our of the We've delivering churn, of of experience. of them wide onboarding renew initiatives of area. engaging which increased our sales XXXX. improve a also better we real working HVAC on diligently retention, delivered AutoPay, makes large benefit can better our to over warranty. lower proud quarter, in during specifically this to revenue finally, includes mix implementing retention to I such a done the am improve record we million proud great job customers, estate are very has in much of on have continues $XX we very of

of we the year and HVAC similar system. that second and as so quarter, in enhanced we Frontdoor app imagine, peak would can into new buy are expecting most this head third summer you all a users the fact, recently we came our a season.In As pattern this now

continuing or know to app.More our chats that here, alternative monetize access is building customers will to la all which services.Our then and by out a revenue opportunity to even repair an with consolidated the might capabilities is are ecosystem vision grow work services we also purchasing that turn demand. continue carte through and our into new we significant, to systems where market but to additional find streams come for We technology appliances to on-demand and ways maintenance video expert, have to provide a into

and early I'm Home the warranty, and of wanted call, be home American out brings our approach to the refreshed strategy X took are Let's energy million a in that a of opportunity.As that starts relaunch approximately Shield that a following the we break sameness that higher excited highest primary at strategy we to on a new kicked category, increase brand U.S. about demand, sea off is relaunch, there which figure our truly brand. our and the warranty. homes a to from holistic understood the turn home components: Slide very brings consumers I last the have high We successfully level, Xx us now that which could said with component a look X April.We believe in better as has to to to and the our which that the relaunch, value warranty of in

wanted larger also new We to audiences. to and connect

ad that's logo we and peace defines homeowners new take want of catchy This have visual our goes It's with with word a tagline consumers tagline, brand also feeling, identity.We us to captures a up from came innovative competition. that better why that main and a we voice proactive be can so needed away, to campaign mind, the and and warranty'. right up 'don't came new we So, a our recognizable new wanted services.We worry, happiness. freedom distinguish that an at with,

will our marketing new believe true our a a look. developed interest comprehensive campaign drive celebrity to on Warrantina, is Rachel with to personality strong, we why extremely colors and partnerships something as we refresh wanted that we we better highly visible. greater new to a brighter, is So, base. partners now finally, do campaign bolder X. about use That's spokesperson, and a products.And We We which Slide break modern omnichannel wanted you media new our This customer Dratch in comedy to excited different more consumers. through shown reflected that are starring great with well-known

new way launched Mania.We highs CNN a the traffic day. on website solar on we eclipse with Russell example, coverage of big For were also the hitting in that campaign our

you and are of visit ahs.com, look summary, interface will only we Speaking hope a look, of also a has intuitive I a improve to brand. more the high-energy navigation all our noticed has and not to refreshed updated it it but tools encourage that website, bringing you conversion.In truly an and

we're know forward for are but category, and more years this for challenging demand relaunched point.As a and come. premature With in warranties change, environment thus we to seeing to home to leader turn results home is the you call. brand far.However, optimistic for excited job our providing However, this are to what on our areas details and the be web we the traffic in trajectory of that we would in warranties, have relaunch improve talk around, growth it look the our it about we will other in much is next face our macro

Frontdoor Jessica? call want XXXX, and a Before our that quarter well. in continues that is are to great show to operating the I I extremely over turn start to off to we Jessica, performance Inc. first reiterate

Jessica Ross

good Bill, morning, Thanks, everyone. and

Before with and wanted into the details, remarks about our I a to first on build thoughts few I high-level get outlook. quarter Bill's

by celebrate through want are driven which raising quarter, response team to drive operational our that excellence business our we strong adjusted the we another was quarter I'm margin and pleased the in margin we to our full had record expansion initiatives.Second, gross for primarily year better-than-expected first margins to performance, across as that EBITDA. First, to share continues outlook

review our summary.First in increased EBITDA for cost million higher $XXX quarter service realized year program. by HVAC move $X gross the $XX channels.This quarter higher to the versus on-demand higher transition revenue Contract I'll to period price, where improvement costs was period offset performance.Now, gross XXX a improvement Now, from provide where offset and XX% XX%. X% fees prior and year-over-year driven prior also home to due more our XX% to by impacts. pressures.Let's let's the to year lower X, was first decline revenue price margin top, gross over primarily Starting XXXX the records first adjusted profit first we points the of primarily $XXX and other in driven services, where continued initiatives both the prior turn X% expected. by $XX had context versus increased includes increase increase quarter sales decreased in The $XX period. claims for process first favorable to XX% X adjusted million by This to fees a to year includes on quarter profit by million. inflationary improved EBITDA that I'll million, year Slide This which had basis primarily an to the service bridge $XX to partially was partially in to a driven conversion, now revenue Slide million improvement and XX, the moving adjusted transition XX% represent EBITDA. million, increased which financial an income XX, Net quarter was than increased for volume, in million, better at new higher Slide

are expense behavior fee in a number new higher per as to cost see service in in amount.Second, lower service fees customer resulted net customer temporary per resulted claims typically fees become of on higher statement. First, to cost accustomed a we request a these lower a contra they services our service fees change until as also the income

our initiatives.This improved period, our our more claims process new part our as purchasing ongoing moving review claims improvement by the to $X change year-over-year. bulk our well improvements contractors, our claims to of planning cost year preferred due as requests offset and leveraging inflation Additionally, power.These million high-cost program in processes, were development improving a over service our unfavorable contract costs includes prior ongoing in partially

prior finally, general administrative resulted EBITDA moving which better sales costs, costs to all due to drive the million $XX our to million. primarily over costs. personnel year our of bridge, of and to primarily our this Now, million to million in increased and some pacing due $X of increased marketing increasing marketing $X increased channel.And adjusted direct-to-consumer To period, growth in investments $XX

data favorable which remember in a by for driver lower outlook, guide. working with provide here.First, the March, weather million, take primary moment approximately to late came With impact compared or million we much the provided were I anticipated, these but to results, we incidents to outlook of of our context want $XX when a March our some than our $XX we and favorable assumed normal exceeded then midpoint February and was more about

process net from As requests our rate, our the relations per jobs management request cost incidence which handles able our a cost service much quarter.With better-than-expected of quarter.Additionally, continued service benefit in by to contractor lower a team. we more to XX% rigorous network, were first anticipated and the allocate came to in our result, contractor in preferred our we improvement than first

used also We for X strong million marketing our ended were million XX of million months of of and well We was favorable to cash and result for million with cash. from comprised $XX restricted $XX higher cash $XX from exceptionally a payments.We was $XX investing and XX majority prior investments.Let's million for of in turn and our March Slide our review capital of provided as investments comprised the $XX of financing capital from Net flows. technology. adjusted statement was business. timing benefited working activities our scheduled activities of comprised of million free around cash-generating primarily speaks million of driven year X period to and provided $X the of was now our used Net was the $XXX by the cash months cash was as pleased of quarter earnings debt ended for was some noncash This power cash million and March as $XX in primarily number cash share activities of the in conversion repurchases also for cash with cash. driven $XXX of extremely ended million for flow $XXX unrestricted was $XX by I believe that of a operating charges comprised earnings million seasonality.Net XX.The earnings, this the related increase over to expenditures million was in

our Slide capital to to extremely framework. have a an and strong continue I'll provide on allocation financial structure.We turning XX, consistent update current where capital position an Now,

will of debt levels the a repurchased to objective ratio expand million to investments Our growth, $XXX saying April, cash both which This, profile, of run very third X.Xx.We around that ago and brings net are earnings, a was Through timing end this focus million return between maintaining leverage driven business. drove Xx. to the long I net higher #X Xx it the we well XXXX.Let our about current we to since and coupled do adjusted initiated we ensure not to leverage above when the low that shares, is turn, recognize amount objective have grow to X.Xx.And to worth strategy flexibility, I ratio total as year of finally, structure. $XXX turning our second debt, modest leverage ratio business ratio organically not coming run program leverage and some through ensure priority to appropriate XX, know which share volatile significant $XX our and that a very just plan in remains down continue better long-term to off of to is units unrestricted utilizing of This have have on I and follow our million by to financial repurchase to want our our through a me decisions is revenue shareholders. prioritize of leverage full in and conclude we was is our which section below I solid Slide of on our the cash $XXX investors where cash that a that million unrestricted by on will required results, with and our cash, of opportunistic seasonality. X.Xx, we focused we growth of and to have of net to our making targeted our and $XXX over outlook. is second walked range million our currently balance targeted ratio was capital prudent continue which net and keeping M&A.Our as closer EBITDA, XXXX our share liquidity quarter through to allocation walk or repurchase.Now, at includes we that financial We level.We level cash

range quarter million.Second the adjusted reflects increase from other We a and million, roughly a XX% of in EBITDA $XXX between a to first million to channel results is $XX mid-single-digit be DTC expected $XXX million improvement $XXX our and real our quarter in over $XX $XXX second a expect to channel, our estate channel, year to renewal in quarter period. expected million a decline reflects which between XX% prior XX% decline million, which approximately increase revenue revenue and in our an increase our XX%,

of HVAC Now, assumes billion a to the the and billion. time channel, a year a XX% mid-single-digit turning with to real This channel.As are between is revenue, maintaining in timing a we to where in our the full the channel range a decline in there DTC we expect revenue to recognized Starting million, It member our a assumes by price, $X.XX approximately lower months. increase by in difference decline renewal and a XX% outlook. $XXX XX% be to realized will XXXX program.We XX% from $X.XX decline realized from increase estate reminder, sale our primarily sales driven also reported revenue, revenue, volume XX will other increase which offset on-demand new mainly mid-single-digit continue higher occurs which a in mid-single-digit over count.

outlook peak our raising as stabilize to reminder, a continue as our expect count XXXX in profit core our are our outlook home we and to XXXX this X%, approximately This to our weather season warranty $X.XX enter approximately X% in assumes XX% gross year stressed. to million.We decline margin be X% margins was down more full typically is system we to into when we normal business. As

term. play investments million. between approximately the relaunch very previously range excited financial assuming our we on also range in are service mentioned million.We Frontdoor and maintaining announced request includes of EBITDA of expense increasing our in per tax for as support conclusion, be critical are brand full we basis, includes million it we capital million full $XXX and million first of outlook be are will a with finally, XXXX SG&A relaunch.As low the full $XX to net expenditures the about updated we will year on effective earlier, $XXX a are adjusted $XXX million also mid-single brand cost be will Shield Bill interest and our quarter and a pleased between be very to number as to American our brand that million between long compensation Home the stock and are $XX from and And of to to to the to the inflation results. we inputs, revenue role million decline year our anticipate income X% the increasing $XXX $XX We $X.X Based digits range approximately million.Our transition annual year growing plan these full service approximately requests reflects expect $XX XX%.In demand year rate to and marketing

Bill EBITDA work before our We back remarks to new and as to ways execute and of few result committed done for turn business.I a the the open our rigorous closing the for initiatives, better-than-expected innovative questions. Bill? continue team deliver to improve remain continuously up we call finding the we margin will line to a to adjusted on now has expansion over

William Cobb

to we final Jessica. questions. go One your Thanks, before note

call heard firmly You still on how I believe our I about talk is me the stock last think that. undervalued.

of use grow performance quarter Our platform. earnings cash am trajectory our analysts.The of Investor category to X to confident our New a share exceptionally our stock.And finally, in buy to City. have demonstrates and investors strong power November customer decided increasing another the I growth have base. we we There are we we are lot vision that right hold so many first York generate and in back is the that the with company strategy or Day path chosen of We our day that upsides on to to this will to

get let's it questions. share now closer please I and for worth open attend, well to we time more your the information line we Operator, as be think will November. to will up

Operator

Schmitt Blair. [Operator to first of Jeff instructions] go Our William question

Jeffrey Schmitt

inflation, continues prices, volume a now? of little think to given are how lower gross a potentially I on bit decline going to Or just it you estate seems to in that better the digits. macro margins Do kind take real you of environment, mean overshot pricing. kind it's for shot mid-single maybe Unit could cut just a strong improve? better,

William Cobb

Yes.

question I your here. answer Real on no us. me think you've the let it. point There's hurt because has hit estate about right Jeff, think, I doubt

level of for discounting DTC been We have X. our increasing

obviously, hopefully, of put something the to to And is we think going that that things benefits is going realize are underway. together, So, improve. we that.With the we're that guide

everyone I real turn. to the talk date. to going turn, real going it's it's industry seen going not says have estate to estate But improve turn, to to it's in We

So, year, felt I brand we have decline estate together over start will the will to turnaround we based of think start DTC rest lessen do as to we on the the in real that put and for the the coming guide relaunch that the confidence the be quarters.

Jeffrey Schmitt

so growth on X%. have to I of X% XX% then, down revenue And declining 'XX X% X% your you DTC guide, guess, you have growth revenues yes, to unit

So, obviously, a kind had they both of quarter. first tougher

you So, trend quite turning those of or do have not far? turning year-end that either positive maybe by of growth kind of What's the there? kind

William Cobb

think I'm clearly, indicate it I to ready would to we're about I into be. going wise, we're when trended feel good to as continues pretty where positive. to 'XX, get turn certainly, quarter-by-quarter. math we And commit not we think head to to better. we the start improve But, that going

Operator

question next The Cory Carpenter to is JPMorgan. of

Cory Carpenter

mostly dollars American outreach $X away ago. that announced some the download Frontdoor from marketing And is some Shield? did given conversion with demand? then, address mark optimization ship towards engagement few million you days You a are you your the just Home that there? the of driving organic efforts Could you where what's So,

William Cobb

Yes.

I we've been pleased hold. that has proposition So, taken the think Frontdoor

services, So, and is through now has people signing have our front continued for model money, to I HVAC goal shift we upgrades. business.We here download always more in-person our Frontdoor has view get been piece think customers, both the the The everything grow as run a the holistic of up. despite to door

the in HVAC to in week, unlimited get last user be the app basic now. We the enabled any out product have an We able there upgrade. just, to

make do the grow really So, It's the more we've engagement for to centerpiece to users grow conversion it's se that the how services this the we offer. and our to really per with is from not continue of we about kind the of evolved app. services.So, Frontdoor of how it's do about variety way we model on-demand them

Cory Carpenter

of kind expect expected a another to expectations? quick maybe take Was I of just you be you XQ. could to Jessica. you higher But the growth did that relative for And year? increase talk the midportion in pricing? through how increase full price The about it guide XX% for the above you round follow-up year. Or the know pricing just

Jessica Ross

No. Yes.

we the is of still to pricing flow Cory, that in If was to that XXXX, take those peak XX you remember, actions months QX this took of those which, XX through off again, and coming QX.

really hit XXXX you're pricing throughout of just peak, that tapering actions off over was the years. the see the this decline year. So, are Again, those the to and going

Operator

The to next Oppenheimer. question Zaffino of goes Ian

Ian Zaffino

Jessica, X how as I breakdown just kind of the one you that think Can inflation. that give When that?And when do to prices maybe here, to of have think know adjust But business. about labor about so maybe between a too, type those need like prices on And maybe a questions. you expect? maybe or growth probably adjusting along us do guess by at just you we should branding And something then, prices. adjust I first be on lot mean parts, need mitigates analysts, on think look would this, what magnitude we we you lines? of trade kind of DTC to the what in business? restore I you going

William Cobb

first the the take take Jessica, one second one. I'll then, you Yes, and

we about estate home relaunch a think a the whole As we calling overall talked the But warranties. where we the good all of as and as discounting the and done is sea think array come as doing we break well connect is on work pricing, that of based far what of about DTC options, of are We've from feel real I we've headed.It's The to on DTC industry about. keep of this. do the that the out before. I elements down we're here. blend We trough we've saying starting tough think discounting brand to through needed some talked guide

doing think I with elements. relaunch the we're that

elements, we've actions on feel to decided only we're And so, take. pricing the those good not I but headed about also where

for I'll it to Jessica over the So, turn inflation piece.

Jessica Ross

from and Remember, contractor-related equipment, rather is individually, bit which service impact Ian. will we so is changes, inflation communicate impact that per lower. costs, and inflation, service a thanks, and parts our it And as we fees.So, in basis, net front process but everything that don't really request a communicate of initiatives that on of includes cost trade was say improvement what for I relatively flat, QX, regulatory the the came door

continuing from, mid. it's moderate, mid to guide at let for just mid, About I our mid. full why think low of we year is to we're sorry, communicated to be low, and I me a think to clarify, more previously we which adjusted to now the

there. And we've to hopefully, helpful. improvements So, see continued some that's

Operator

The next question goes KeyBanc. of to Sergio Segura

Sergio Segura

the kind you so course you customer the hoping just in of your the about speaking demand far, the you're increase if year. Shield brand just going we just for know of how been just seeing American to what early, the but expectations to ultimately, trajectory service over for could macroeconomic this guys I the it's have you're impact talk will what Bill, this seeing. First, environment year. is of that And you growth think, the for want

William Cobb

happened too come it's together encouraging I the is results. and what's that the fit elements do that Obviously, Okay. very relaunch well. in the call. together talk specific really think of to early that's about to We'll tell QX all have give

the our new things think terrific. media great.I call, has the plan been all through I think I in logo I the think looks went

we're advertising really there. think The been on what's website, been I the with great. has pleased going

is better. the that the are we elements real to and that the about.I believe going on sameness estate we to do to there's CF we've much start the real out us really talked for start But kick better. piece about that. estate we're can other just So, in place of think not is macro gets back not sitting waiting hope for get But

done the on We work our as all seen you've hard, are we've renewals working with business. very

As continue effort best. efforts, of another marketing team we our new user sitting are by relations customers, super a proud in then done call, as the part keep has really And drive.These and the our through really being in HVAC pricing has has are together for standing I while stream.So, service trough supplemented our want not are our team, this from start revenue to company. the there contractor by of new our taken team, really the hoping counts we as to of program I'm really we said them idly tough, the pulled going our off everybody team, our to and where vector our overall from ops initiative

to continuing have up guide, of second and into numbers think QX. you a working half, to better, the coming little are get And to see in our leading QX to new trying going thinking. think I new I that we're elements by improved with is it's ways overall as in we're 'XX all XXXX. be tough phase.But piece a initiatives We can through come know across going we going and but

Sergio Segura

maybe Jessica. a then follow-up And for

we flowing to You about buybacks guys margin had very versus strong the growth? the performance that think should how invest behind opportunities to guess, on and the outlook more increasing and for revenue upside our pace of side growth I accelerate the year. raised profitability even down initiatives

Jessica Ross

Now, thanks, Sergio.

I a it's great question. think

and a a term. low very as think I and are leverage recognize to sitting unrestricted intention ratio balance, remarks, cash sit at not I the said it's strong our pretty here my for long that we in we

we sticking through And are opportunistic really be our capital X be we to about really that on want the million a or excess through to longer-term I the is that of run is leverage on tons M&A. target million we ratio absent organically at allocation which to and very think X.X $XXX whether that, to $XXX and back need focused shares. where on to on strategy, cash our buy really focused is business.So, focused to growth

we've of been QX, it and bit there is that. do we here the consistently seasonality program, a for intention launched to since our neo timing but little to continue So, doing was and that

Operator

Hughes next Truist. Mark to goes [Operator our instructions] of And question

Mark Hughes

Or the of that at about typically do it, financial opportunistic thinking a, that? capabilities be you new perhaps? bringing those would M&A, that normally to are policyholder How more it's base, transaction? and so In look deals get call

William Cobb

Yes. in to holistic Mark, think try I at we it a look manner.

industry of because approach that for taking of opportunities think So, the now. an company.So, broadly talking group that to a variety of stated of gamut right what takes that run at what about. we're our can we we the the looking are that's have I don't enhance as have opportunities BD may look look really specifically have opportunity leader, at we a We the a value policy you're exactly a

Mark Hughes

gives that think or that there pointed think that Could out out, touched with to How some that more of about the continue you you've flesh program is do. what Then, have perhaps on I right? some you of revenue, the but penetration growth? HVAC past I that you do your in confidence contractors, Do expand? maybe the you there's that you opportunity. to visibility other you

William Cobb

fair Yes. point. No,

couple of We have a here. tailwinds

obsolete. which the around of there's to equipment going or all, for is refrigeration of refrigerant, some the environmental older regulatory render the First change change

So, people to are equipment. going their to have upgrade

that's our contractor a install couple for They'd to is with sense us.Second of there roll in engage the then for program, dollar a of, enthusiasm simple much this them. macro and economics is our relations it's rather great to and So, a our contractors team help truck a repair. HVAC with do in that's $X,XXX really going hundred

to So, enthusiasm contractors finally, proposition the we adds and up to buy this really for our with our OEMs business and with the great then well proposition a abilities terrific receptivity our then to ability marketing contractors.And obviously, to have consumer us. the interact with from value

about pretty we're pumped area. why that's So, up this

Jessica Ross

I to the the think contractors, continue I has team be that the I been excited would and expanding really really a one I with there And add contractor that. adoption the to, doing relations also show, thing about out road think

program sure perspective, we is What think I doing it's everything to are can from a anticipating but that we're the the on consumer. So, scaling. both we ground make the consumer here

Mark Hughes

development the or development. And then Jessica, reserve claims

about of $X the too ended where structurally was up stand talk kind that? Frankly coming tailwind inflation it improved, can the do up there? ended speaking, being I million your think you on there accruals quarter. we in a high. earlier I better Are in past you maybe expected this that think when than things in

Jessica Ross

I've it's reflecting point. that It's Yes. actually on. No, I been something great a think

and quarter.And that results, about came that as we of think we of claims when it's we've I off narrowed. quarter think an had the delivered one, $XX development volatility that I adjusted cost inflation, EBITDA gotten first that down coming I million about million. in, really think so to that had $XX in stabilized I QX And beat XXXX of and

that XX% flat. of that about tailing same to down quarter, So, we Frontdoor year of had inflation,

think aligns to really I development.Yes, cost was that up going think inflationary I claims with say, that why I you're tightening seeing the pressure. there's just of

of that just improvements process work the also is tightening reiterate team the in want to driving board up across terms the are costs. doing I our that So,

there's So, all together. holistic a I think It's firing getting to working just on everything cylinders. process

Operator

The to Fitzgerald next of Wells question Brian Fargo.

Brian Fitzgerald

the thinking how And across that strengths been of A you guys or past? couple weaknesses one have talking demographics, address regions campaign and follow-up. regional of follow-ups. got of the brand maybe about may I the and opportunities to marketing the are When demographic historically, you in then think about the underserved opportunities and

William Cobb

Yes.

revitalize of I you've think is brand, resilient. think the this with XX-year-old any it. are extremely core I got to brands But

timing.Anyway, overall. group on it keep answer that going a I We'll there larger demographics. lot targeting, set find home off, part done market trying to one your point particularly So, and really have is we're had what's The become we've going. marketing Brian. think a didn't that but I I your work go Latino a in of it's new Anyway, revitalize about brand. I'll and is a good they interested the Collins at look Kathy here, around I that perfect ownership to will think of questions. out really as

to We point specific And just one up. more bring Spanish our targeting some now. example of elements. language on get trying are efforts.But ways of the it's This website the that's is a have just we to right

of a of is strong. have traditionally Sunbelt, where we states, regional the been beyond we perspective, very a from think kind smile I opportunity the still think lot there

So that into more we're northern to opportunity to we greater we're penetration the of into. is drive that is markets.But something grow part help think trying that some also that is going set to

Brian Fitzgerald

other from color give the service that was tailwind gross the had persists? change. your fee question Could long us the then on some potential you how around expectations And we for benefits margin

William Cobb

and those response were.Now, all raised where really One We thing it increase staying I service the fee as and I'll outcome this a Jessica with I'll P&L, costs contractor labor of costs as fee elements. through was say, trade and with answer fuel -- -- an would trade contractor how really in flows current Jessica to specific as and far service costs insurance the the let is let increased

Jessica Ross

time. mean, take shifts they are can I No, these Yes. again, so behavior and

our this XXXX. So, we've in plan anticipated throughout

Operator

call joining no Quarter thank Earnings questions. is Today's for have Frontdoor's We Ladies and you further XXXX again concluded. Call. First now gentlemen,

Frontdoor (FTDR) 2 May 242024 Q1 Earnings call transcript