The company’s earnings report showed that revenue grew 7% between April and June to $295.2 million, but it also lost $27.9 million, just slightly higher than the loss in the second quarter of 2023.
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Redfin nearly stagnated in the second quarter of 2024, with a new report showing the company’s revenue was growing despite losses and web traffic being nearly flat.
According to its second-quarter financial report, the portal and brokerage company’s total revenue was $295.2 million between April and June this year. Compared with the same period in 2023, this is an increase of 7%.
The report also shows that Redfin’s apps and website attract “an average of nearly 52 million monthly users.” In the second quarter of 2023, the company averaged 52 million monthly users.
Glenn Kelman
In the report, Redfin CEO Glenn Kelman celebrated the results, saying “Redfin delivered revenue, profit and market share growth in a still declining market.”
The report showed that gross profit (a figure that calculates profit before production costs and other expenses such as interest or taxes) increased by 9% year-on-year to $109.6 million. The report added that Redfin’s market share accounted for 0.77% of existing U.S. home sales, up from 0.75% a year ago.
Redfin shares were trading in the low $7 range when it reported earnings on Tuesday. Shares were down slightly on both the day and the week, and are down from this time last year, when shares were in the low $10s.
Shares were volatile in after-hours trading following Tuesday’s earnings release, but ultimately trended lower.
Credit: Google
As of Tuesday afternoon, Redfin’s market capitalization was about $848 million.
Redfin last reported earnings in May. At the time, the company revealed that revenue in the first quarter of this year increased 5% year-on-year to $225.5 million. The company also lost $66.8 million in the quarter, up from $60.8 million in the first quarter of 2023.
During a call with investors Tuesday afternoon, Kelman touted the development of Redfin Next, a program launched earlier this year to transition agents from a salary to a commission model. Redfin initially launched the program in four markets in California but has since expanded it to dozens of other markets.
The program will be available in all of the company’s markets by 2025 and help with recruitment, Kelman said on the call. The report adds, “To date, Redfin has signed more than 200 top brokers to join the brokerage business under the Redfin Next umbrella.”
Taking a call from Wall Street analysts during the conference call, Kelman added, “The next dimension for us is teams.” He explained that Redfin wants to build teams around its top producers, which in turn will allow the company to Under the leadership of these top producers, “new agents in the industry are developed.”
“We think this will allow us to expand our hiring,” he added.
Teams have become a major trend in real estate in recent years, playing a role in the rise of established companies like Coldwell Banker and upstarts like eXp Realty. Yet Redfin — perhaps due to its now-gone salaried agent model — has been largely absent from this conversation. However, Kelman’s comments indicate that the company is now looking to get on board with the team more publicly.
Kelman also speculated on the call that Redfin may have a recruiting advantage due to impending changes in industry rules resulting from antitrust lawsuits. Kelman believes the changes “may encourage more agents to consider setting up brokerages with the goal of competing on price, thereby aiding recruitment.”
Later in the call, Kelman discussed the market, saying it “is turning significantly in favor of buyers.” That’s thanks to rising inventory and falling interest rates, though he added that so far, lower interest rates haven’t spurred a big jump in home buying rates.
“This is the first time in many years that a significant rate cut has had no impact on home buying demand,” Kelman said. He later added, “I can’t remember a time when interest rates have fallen so quickly and the market has been so quiet in its response.”
Kelman speculates that this “silent” reaction may be due to anxiety about the upcoming presidential election or the economy. Or, he continued, the latest rate cut may simply be “too late” as many people are on vacation or no longer paying attention to the housing market this year. However, he said it was “inconceivable to me that there wouldn’t be any reaction” and that if “interest rates continue to fall, U.S. home sales should increase.”
“I believe the housing market is about to get better,” Kelman said, “and Redfin is about to take market share.”
Update: This article was updated after publication to add more information from Redfin’s earnings report and comments from the company’s investor call.
Email Jim Dalrymple II
