Redfin nearly doubled profits over this time last year and revenue is up 35 percent, but the tech-powered real estate brokerage missed Wall Street expectations, and its stock is down as a result.
Redfin in its second quarter as a public company reported earnings of 12 cents per diluted share on $109.5 million in revenue. Analysts surveyed in advance by Yahoo Finance expected earnings of 13 cents per share on $110.6 million in revenue.
Redfin reported quarterly profit of $10.6 million, compared to $5.7 million last year at this time. Redfin accounted for 0.71 percent of U.S. existing home sales by value in the third quarter, an increase of 0.14 percentage points over last year.
“Redfin’s brokerage market-share gains accelerated again in the third quarter, with strong traffic growth and steadily increasing sales in all of our new businesses,” Redfin CEO Glenn Kelman said in a statement. “We also invested in making our service better and more efficient over the coming years while delivering better-than-expected earnings in the quarter, pairing long-term thinking with financial discipline.”
Redfin stock is down close to 7 percent in after-hours trading. Even with today’s dip, Redfin stock is up 44 percent since its IPO in July.
Redfin Now, a service that lets customers sell homes directly to Redfin, accounted for $3.4 million in revenue in the third quarter. The experimental program expedites the process in exchange for customers typically netting lower proceeds than they might in typical sales.
Redfin said it added a couple of new products that make parts of the process easier on agents or automate them all together. The company added a new layer of automation in the third quarter that lets it automatically confirm availability of home tour times. Redfin also rolled out a new speedy offer-writing software called Redfin Fast Offers in Washington, D.C. and Virginia, with expansion to additional markets planned in the coming months.