Shares of Redfin were up more than 6 percent in after-hours trading after the real estate company posted its third quarter earnings report. Revenue grew 70 percent year-over-year to $239 million while earnings per share was $0.07, up from $0.04.
Analysts expected revenue of $230 million and EPS of $0.04.
Redfin’s strong results were powered by the Properties division, which includes the company’s RedfinNow initiative for buying homes directly from consumers, spiffing them up and selling them. The Properties segment brought in $80.9 million in revenue, up from $11.4 million last year, with a $745,000 loss. Redfin expanded RedfinNow to Austin, Houston, and San Antonio this quarter.
“Redfin’s third quarter was strong across the board, with accelerating revenues and year-over-year gross-margin gains in every one of our businesses,” Redfin CEO Glenn Kelman said in a statement. “We’re investing more in better service, but also in disruptive technologies that let people tour and buy homes without an agent. We’ve expanded instant offers for homeowners from six to ten markets, and are now showing homebuyers the commissions that a seller is offering their agent. These are big strides toward our long-term goal of redefining real estate in the consumers’ favor.”
Redfin quietly launched a program in April called Redfin Direct that lets homebuyers without an agent make offers on homes directly through its website, bringing back an initiative the company first tried more than a decade ago. The so-called “Buy-It Button” is part of what Kelman has called Redfin’s second act of changing how homes are bought and sold. Redfin said it received 68 Direct offers in the third quarter, resulting in 18 closings. It also expanded “Direct Access for RedfinNow,” which lets buyers use their phone to unlock doors and tour homes without an agent.
The company’s stock is up slightly this year, trading at $18.54 when the market closed Wednesday.
Redfin finds itself in the midst of an incredibly active real estate tech market. Crosstown rival Zillow has redefined its entire business around buying and selling homes directly. Others such as Compass, which just opened a new Seattle engineering office, are also competing.
Editor’s note: This post was updated to reflect the $745 million loss in the Properties segment.