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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2024

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___ to ___

Commission file number 001-38160


Redfin Corporation

(Exact name of registrant as specified in its charter)

Delaware

74-3064240

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

1099 Stewart Street

Suite 600

Seattle

98101

(Address of Principal Executive Offices)

(Zip Code)


(206)			576-8610
Registrant's telephone number, including area code

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.001 par value per share	RDFN	The Nasdaq Stock Market, LLC

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

☒

Yes

☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.

☐

Yes

☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☒

Yes

☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒

Yes

☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statement of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐

Yes

☒

As of the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the registrant's common stock held by its non-affiliates, computed by reference to the price at which the common stock was last sold, was $706,662,982.

The registrant had 126,389,290 shares of common stock outstanding as of February 19, 2025.

DOCUMENTS INCORPORATED BY REFERENCE

The portions of the registrant's proxy statement to be filed in connection with the registrant’s 2025 Annual Meeting of Stockholders that are responsive to the disclosure required by Part III of Form 10-K are incorporated by reference into Part III of this Form 10-K.

Redfin Corporation

Annual Report on Form 10-K

For the Year Ended December 31, 2024

Table of Contents



PART I		Page
Item 1.	Business	1
Item 1A.	Risk Factors	5
Item 1B.	Unresolved Staff Comments	19
Item 1C.	Cybersecurity	20
Item 2.	Properties	21
Item 3.	Legal Proceedings	21
Item 4.	Mine Safety Disclosures	21

PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	22
Item 6.	[Reserved]	23
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	48
Item 8.	Financial Statements and Supplementary Data	50
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	89
Item 9A.	Controls and Procedures	89
Item 9B.	Other information	90
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	91

PART III
Item 10.	Directors, Executive Officers and Corporate Governance	92
Item 11.	Executive Compensation	92
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	92
Item 13.	Certain Relationships and Related Transactions, and Director Independence	92
Item 14.	Principal Accounting Fees and Services	92

PART IV
Item 15.	Exhibits, Financial Statement Schedules	93
Item 16.	Form 10-K Summary	93

	Signatures

As used in this annual report, the terms "Redfin," "we," "us," and "our" refer to Redfin Corporation and its subsidiaries taken as a whole, unless otherwise noted or unless the context indicates otherwise. However, when referencing (i) the 2023 notes, the 2025 notes, the 2027 notes, the terms “we,” “us,” and “our” refer only to Redfin Corporation and not to Redfin Corporation and its subsidiaries taken as a whole, (ii) the Apollo term loan, the terms “we,” “us,” and “our” refer only to Redfin Corporation and its subsidiaries except for Bay Equity LLC, taken as a whole, and (ii) each warehouse credit facility, the terms "we," "us"," and "our" refer to Bay Equity LLC.

Note Regarding Forward-Looking Statements

This annual report contains forward-looking statements. All statements contained in this report other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans, our market growth and trends, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” “could,” “would,” “project,” “plan,” "hope," “potentially,” “preliminary,” “likely,” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including those described under Item 1A. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the effect of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events and trends discussed in this report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Accordingly, you should not rely on forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, performance, or events and circumstances reflected in the forward-looking statements will be achieved or occur. We undertake no obligation to update any of these forward-looking statements for any reason after the date of this report or to conform these statements to actual results or revised expectations.

Note Regarding Industry and Market Data

This annual report contains information using industry publications that generally state that the information contained therein has been obtained from sources believed to be reliable, but such information may not be accurate or complete. While we are not aware of any misstatements regarding the information from these industry publications, we have not independently verified any of the data from third-party sources nor have we ascertained the underlying economic assumptions relied on therein.

Table of Contents

PART I

Item 1. Business

Overview

We help people buy and sell homes. Representing customers in approximately 100 markets in the United States and Canada, we are a residential real estate brokerage. We pair our own agents with our own technology to create a service that is faster, better, and costs less. We meet customers through our listings-search website and mobile application.

We use the same combination of technology and local service to originate, service, and subsequently sell mortgage loans and offer title and settlement services. We also offer digital platforms to connect consumers with available apartments and houses for rent and for other advertising.

Our mission is to redefine real estate in the consumer’s favor.

Representing Customers

Our brokerage efficiency results in savings that we share with our customers. We charge most home sellers a commission of 1% to 1.5%, compared to a more common 2.5% listing fee typically charged by traditional brokerages.

The results of our customer-first approach are clear. We:

•helped customers buy or sell more than 621,000 homes worth more than $316 billion through 2024;

•saved customers approximately $1.8 billion, when compared to a 2.5% commission, since our launch in 2006;

•drew more than 48 million monthly average visitors to our website and mobile application in 2024;

•had listings on the market for an average of 39 days during the twelve months ended July 1, 2024 compared to the industry average of 43 days, according to a study we commissioned; and, according to the same study, approximately 90% of Redfin listings sold within 90 days versus the industry average of approximately 87%.

To serve customers when our own agents can’t due to high demand or geographic limitations, we’ve developed partnerships with over 5,148 agents at other brokerages. Once we refer a customer to a partner agent, that agent, not us, represents the customer from the initial meeting through closing, at which point the agent pays us a portion of her commission as a referral fee.

Complete Customer Solution

Our aim is to combine brokerage, rentals, mortgage, and title services into one solution, sharing information, coordinating deadlines, and streamlining processes so that a consumer's move is easier and often less costly. As we integrate these services more closely over time, we believe we can help consumers move much more efficiently than a combination of stand-alone companies ever could.

Bay Equity underwrites mortgage loans and, after originating each loan, Bay Equity sells most of the loans to third-party mortgage investors, retains a small amount of mortgage servicing rights, and services a small portfolio of loans. Bay Equity is licensed in 48 states and the District of Columbia. These markets accounted for more than 98% of our brokerage's buy-side transactions in 2024.

Title Forward offers title and settlement services. Title Forward has officially launched in 12 states and the District of Columbia. These markets accounted for 67% of our brokerage's transactions in 2024.

Rent. offers an end-to-end digital marketing platform that connects consumers with available apartments and houses for rent across all 50 states and the District of Columbia.

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RedfinNow bought homes directly from homeowners and resold them to homebuyers. In November 2022, we decided to wind-down RedfinNow, and we completed the liquidation of our RedfinNow inventory in the second quarter of 2023.

Competition

The residential brokerage industry is highly fragmented, with numerous active licensed agents and brokerages, and is evolving rapidly in response to technological advancements, changing customer preferences, and new offerings. We compete primarily against other residential real estate brokerages, which include franchise operations affiliated with national or local brands, and small independent brokerages. We also compete with hybrid residential brokerages, which combine Internet technology and brokerage services, and a growing number of others that operate with non-traditional real estate business models. Competition is particularly intense in some of the densely populated metropolitan markets we serve, as they are dominated by entrenched real estate brokerages and are the primary markets for innovative and well-capitalized new entrants.

We believe we compete primarily based on:

•access to timely, accurate data about homes for sale;

•traffic to our website and mobile application, which themselves are subject to competition against real estate data websites that aggregate listings and sell advertising to traditional brokers;

•the speed and quality of our service, including agent responsiveness and local knowledge;

•our ability to hire and retain agents who deliver the best customer service;

•the costs of delivering our service and the price of our service to consumers;

•consumer awareness of our service and the effectiveness of our marketing efforts;

•technological innovation; and

•depth and breadth of local referral networks.

Bay Equity competes with numerous national and local multi-product banks as well as focused mortgage originators. We compete primarily on service, product selection, interest rates, and origination fees.

Title Forward competes with numerous national and local companies that typically focus solely on these services. We compete primarily on timeliness of service and fees.

Rent. competes with companies that provide an online marketplace for residential rental listings and related digital marketing solutions. We compete primarily on the scope and quality of listings we offer on our digital platforms, traffic generated through our websites and mobile applications, and the breadth of our broader marketing services. In February 2025, we announced a partnership with Zillow, Inc. (“Zillow”) to increase the scope and quality of our listings and to monetize our websites through selling leads to Zillow rather than through subscriptions directly to property managers (see Note 15).

Seasonality

For the impact of seasonality on our business, see "Quarterly Results of Operations and Key Business Metrics" under Item 7.

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Our Lead Agents

Our goal is to be the best employer in real estate. At the heart of this goal is an investment in the real estate agents who directly help our customers buy and sell homes. We refer to these agents as our lead agents. Unlike traditional real estate brokerages, where agents work as independent contractors, we employ our lead agents and provide them with health insurance and other benefits as well as the opportunity to earn equity compensation. As a result, our lead agents in 2024 earned a median income that was more than two times as much as agents at competing brokerages. Also in 2024, our lead agents were, on average, more than twice as productive as agents at competing brokerages. And compared to the top-20 brokerages by volume in 2024, our lead agents had the highest annual sales volume. In January 2024, in four pilot markets, we began paying lead agents a larger transaction bonus in lieu of a base salary. We expanded this pay plan to an additional seven markets in May 2024, and to another 25 markets in August 2024. In October 2024, we moved all lead agents to this pay plan.

As of December 31, 2024, we had 4,778 employees. For 2024, our average number of lead agents was 1,765. See "Key Business Metrics - Average Number of Lead Agents" under Item 7.

Our Executive Officers

Below is information regarding our executive officers. Each executive officer holds office until his or her successor is duly elected and qualified or until the officer’s earlier resignation, disqualification, or removal.

•Glenn Kelman, age 54, has served as our chief executive officer since September 2005 and one of our directors since March 2006.

•Bridget Frey, age 47, has been employed by us since June 2011 and has served as our chief technology officer since February 2015.

•Anthony Kappus, age 44, has been employed by us since March 2014 and has served as our chief legal officer since May 2021. Mr. Kappus previously served as our senior vice president - legal affairs from August 2018 to May 2021 and vice president - legal from September 2014 to August 2018.

•Chris Nielsen, age 58, has served as our chief financial officer since June 2013.

•Anna Stevens, age 51, has served as our chief human resources officer since August 2022. Prior to joining Redfin, Ms. Stevens served as the Chief People Officer of HD Supply, Inc., a North American industrial distributor.

•Christian Taubman, age 46, has served as our chief growth officer since April 2021. Mr. Taubman previously served as our chief product officer from October 2019 to April 2021. Prior to joining Redfin, Mr. Taubman served in several different roles with Amazon (a technology company) from April 2011 to October 2019. As Director - Smart Home Verticals from December 2017 to October 2019, Mr. Taubman led employees in product management, software engineering, and program management, with the mission of helping customers to connect more smart devices to Amazon's Alexa virtual assistant.

Our Regulatory Environment

The residential real estate industry is heavily regulated by federal, state, and local governments in the United States. Because of our complete customer solution approach of combining brokerage, rentals, mortgage, title services, a customer may be able to receive more than one real estate-related service from us. Accordingly, some government regulations affect more than one of our operating segments and may impact our ability to offer multiple services to the same customer.

For example, the Real Estate Settlement Procedures Act of 1974 restricts, with some exceptions, kickbacks or referral fees that real estate settlement service providers, such as brokerages, mortgage originators, and title and closing service providers, may pay or receive in connection with the referral of settlement services. Furthermore, the Fair Housing Act of 1968 (the “FHA”) prohibits discrimination in the purchase or sale of homes. The FHA applies to real estate agents, mortgage lenders, title companies, and home sellers, such as RedfinNow, as well as many forms of advertising and communications, including MLS listings and insights about home listings.

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Additionally, our brokerage, mortgage, and title business each requires a license specific to its business from each state in which it operates, and the licensing requirements vary by state. Furthermore, some of our employees who provide services for these businesses must also hold individual licenses. These entity and individual licenses may be costly to obtain and maintain, which may adversely affect our company’s earnings.

Our Website and Public Filings

Our website is www.redfin.com. Through this website, we make available, free of charge, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as soon as reasonably practicable after we file such material with, or furnish it to, the U.S. Securities and Exchange Commission (the "SEC").

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Item 1A. Risk Factors

You should carefully consider the risks described below, together with all other information in this annual report, before investing in any of our securities. The occurrence of any single risk or any combination of risks could materially and adversely affect our business, operating results, financial condition, liquidity, or competitive position, and consequently, the value of our securities. The material adverse effects include, but are not limited to, not growing our revenue or market share at the pace that they have grown historically or at all, our revenue and market share fluctuating on a quarterly and annual basis, an extension of our history of losses and a failure to become profitable, not achieving the revenue and net income (loss) guidance that we provide, and harm to our reputation and brand.

Risks Related to Our Business and Industry

Our business depends significantly on the health of the U.S. residential real estate industry and changes in general economic conditions.

Our success depends largely on the health of the U.S. residential real estate industry. This industry, in turn, is affected by changes in general economic conditions, which are beyond our control. Any of the following factors could reduce the volume of residential real estate transactions, cause a decline in the prices at which homes are bought and sold, or otherwise adversely affect the industry and harm our business:

•seasonal or cyclical downturns in the U.S. residential real estate industry, which may be due to a single factor, or a combination of factors, listed below, or factors which are currently not known to us or that have not historically affected the industry;

•slow economic growth or recessionary conditions;

•increased unemployment rates or stagnant or declining wages;

•inflationary conditions;

•low consumer confidence in the economy or the U.S. residential real estate industry;

•consumer hesitancy to spend or take on debt due to economic uncertainty;

•adverse changes in local or regional economic conditions in the markets that we serve, particularly our top-10 markets and markets into which we are attempting to expand;

•increased mortgage rates, reduced availability of mortgage financing, or increased down payment requirements;

•low home inventory levels, which may result from zoning regulations, higher construction costs including those resulting from potential tariffs, and housing market uncertainty that discourages some home sellers, among other factors;

•lack of affordably priced homes, which may result from home prices growing faster than wages, among other factors;

•volatility and general declines in the stock market or lower yields on individuals' investment portfolios;

•increased barriers to, or expenses associated with, home ownership, including the unavailability of insurance or rising insurance costs that may result from more frequent and severe natural disasters and inclement weather;

•newly enacted and potential federal, state, and local legislative actions, as well as new judicial decisions, that would affect the residential real estate industry generally or in our top-10 markets, including (i) actions or decisions that would increase the tax liability arising from buying, selling, or owning real estate; (ii) actions or decisions that would change the way real estate brokerage commissions are negotiated, calculated, or paid; (iii) actions or decisions that would discourage individuals from owning, or obtaining a mortgage on, more than one home; and (iv) potential reform relating to Fannie Mae, Freddie Mac, and other government sponsored entities that provide liquidity to the mortgage market;

•loss in confidence in the debt, obligations, or operations in the U.S. government, or a shutdown of the U.S. government, which could impact broader credit markets or economic activity;

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•changes that cause U.S. real estate to be more expensive for foreign purchases, such as (i) increases in the exchange rate for the U.S. dollar compared to foreign currencies and (ii) foreign regulatory changes or capital controls that make it more difficult for foreign purchasers to withdraw capital from their home countries or purchase and hold U.S. real estate;

•changed generational views on homeownership and generally decreased financial resources available for purchasing homes; and

•war, terrorism, political uncertainty, competing priorities of the new presidential administration, natural disasters, inclement weather, health epidemics or pandemics, and acts of God, and the effects of such events on the U.S. residential real estate market.

Our real estate services segment is concentrated in certain geographic markets. Our failure to adapt to any substantial shift in the relative percentage of residential housing transactions from these markets to other markets in the United States could adversely affect our financial performance.

For the year ended December 31, 2024, our top-10 markets by real estate services revenue consisted of the metropolitan areas of Boston, Chicago, Denver (including Boulder and Colorado Springs), Los Angeles (including Santa Barbara), Maryland, Northern Virginia, Portland (including Bend), San Diego, San Francisco, and Seattle.

Local and regional conditions in these markets may differ significantly from prevailing conditions in the United States or other parts of the country. Accordingly, events may adversely and disproportionately affect demand for and sales prices of homes in these markets.For example, the recent fires in the Los Angeles area may have an adverse impact on local housing supply, demand, and sale prices in that market. Any overall or disproportionate downturn in demand or home prices in any of our largest markets, particularly if we are unable to increase revenue from our other markets, could adversely affect growth of our revenue, gross profit, profitability, and market share or otherwise harm our business.

Our top markets are primarily major metropolitan areas, where home prices and transaction volumes are generally higher than other markets. As a result, our real estate services revenue, gross margin, and gross profit are generally higher in these markets than in our smaller markets. To the extent there is a long-term net migration to cities outside of these markets, the relative percentage of residential housing transactions may shift away from the top markets where we have historically generated most of our revenue and gross profit. Our inability to adapt to any shift, including failing to increase revenue and gross profit from other markets, could adversely affect our financial performance and market share.

Competition in each of our lines of business is intense.

Many of our competitors across each of our businesses have substantial competitive advantages, such as longer operating histories, stronger brand recognition, greater financial resources, more management, sales, marketing and other resources, superior local referral networks, perceived local knowledge and expertise, and extensive relationships with participants in the residential real estate industry, including third-party data providers such as multiple listing services ("MLSs"). Consequently, these competitors may have an advantage in recruiting and retaining agents, attracting consumers, and growing their businesses. They may also be able to provide consumers with offerings that are different from or superior to those we provide. The success of our competitors could result in our loss of market share and harm our business.

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We have integrated, and may continue to integrate in the future, AI in certain tools and features available on our platform. AI technology presents various operational, compliance, and reputational risks and if any such risks were to materialize, our business and results of operations may be adversely affected.

We have integrated artificial intelligence (“AI”) technologies in many of our tools and features available on our website and in the tools that our agents use in their daily activities. For example, we may use AI technologies to estimate home values, scale frequently performed tasks, or answer customer questions. We may continue to integrate these technologies in new offerings. Notwithstanding the use of AI on our website and with certain agent activities, we’ve yet to utilize AI within our financial reporting or internal control over financial reporting functions. Given that AI is a rapidly developing technology that is in its early stages of business use, it presents a number of operational, compliance and reputational risks. AI algorithms are currently known to sometimes produce unexpected results and behave in unpredictable ways (e.g., “hallucinatory behavior”) that can generate irrelevant, nonsensical, fictitious, deficient, offensive or factually incorrect content and results, which if incorporated into our platform, may result in reputational harm to us and our agents and be damaging to our brand. Additionally, content, analyses or recommendations that are based on AI might be found to be biased, discriminatory or harmful. Data sets from which Large Language Models learn are at risk of poisoning or manipulation by bad actors, resulting in offensive or undesired output. Similarly, the data set could contain copyrighted material resulting in infringing output. AI output might present ethical concerns or violate current and future laws and regulations, including licensing laws and a variety of federal and state fair lending laws and regulations such as the Fair Housing Act, the Equal Credit Opportunity Act, the Home Mortgage Disclosure Act, and the prohibition against engaging in Unfair, Deceptive, or Abusive Acts or Practices pursuant to the Dodd-Frank act.

We expect that there will continue to be new laws or regulations concerning the use of AI technology, which might be burdensome for us to comply with and may limit our ability to offer or enhance our existing tools and features or new offerings based on AI technology. Further, the use of AI technology involves complexities and requires specialized expertise. We may not be able to attract and retain top talent to support our AI technology initiatives. If any of the operational, compliance or reputational risks were to materialize, our business and results of operations may be adversely affected.

We may be unable to maintain or improve our current technology offerings at a competitive level or develop new technology offerings that meet customer or agent expectations. Our technology offerings may also contain undetected errors or vulnerabilities.

Our technology offerings, including tools, features, and products, are key to our competitive plan for attracting potential customers and hiring and retaining lead agents. As the number of homebuyers and home sellers, renters, agents, and listings shared on our website and mobile application and the extent and types of data grow, our need for additional network capacity and computing power will also grow. Maintaining or improving our current technology, network capacity and computing power to meet evolving industry standards and customer and agent expectations and data growth, as well as developing commercially successful and innovative new technology, is challenging and expensive. For example, the nature of development cycles may result in delays between the time we incur expenses and the time we introduce new technology and generate revenue, if any, from those investments. Anticipated customer demand for a technology offering could also decrease after the development cycle has commenced, and we would not be able to recoup costs, which may be substantial, we incurred.

As standards and expectations evolve and new technology becomes available, we may be unable to identify, design, develop, and implement, in a timely and cost-effective manner, new technology offerings to meet those standards and expectations. As a result, we may be unable to compete effectively, and to the extent our competitors develop new technology offerings faster than us, they may render our offerings uncompetitive or obsolete. Additionally, even if we implemented new technology offerings in a timely manner, our customers and agents may not accept or be satisfied by the offerings.

Furthermore, our development and testing processes may not detect errors and vulnerabilities in our technology offerings prior to their implementation. Any inefficiencies, errors, technical problems, or vulnerabilities arising in our technology offerings after their release could reduce the quality of our services or interfere with our customers' and agents' access to and use of our technology and offerings.

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We may be unable to obtain and provide comprehensive and accurate real estate listings quickly, or at all.

We believe that users of our website and mobile application come to us primarily because of the real estate listing data that we provide. Accordingly, if we were unable to obtain and provide comprehensive and accurate real estate listings data, our primary channels for meeting customers will be diminished. We get listings data primarily from MLSs in the markets we serve. We also source listings data from public records, other third-party listing providers, and individual homeowners and brokers. Many of our competitors and other real estate websites also have access to MLSs and other listings data, including proprietary data, and may be able to source listings data or other real estate information faster or more efficiently than we can. Since MLS participation is voluntary, brokers and homeowners may decline to post their listings data to their local MLS or may seek to change or limit the way that data is distributed. There are industry participants actively working to change local MLS rules to allow brokers and homeowners to exclude more listings from the MLSs. A competitor or another industry participant could also create an alternative listings data service, or their own exclusive listings database, which may reduce the relevancy and comprehensive nature of the MLSs. If MLSs cease to be the predominant source of listings data in the markets that we serve, we may be unable to get access to comprehensive listings data on commercially reasonable terms, or at all, which may result in fewer people using our website and mobile application.

We rely on business data to make decisions and drive our machine-learning technology, and errors or inaccuracies in such data may adversely affect our business decisions and the customer experience.

We regularly analyze business data to evaluate growth trends, measure our performance, establish budgets, and make strategic decisions. While our business decisions are based on what we believe to be reasonable calculations for the applicable period of measurement, there are inherent challenges in measuring and interpreting the data, and we cannot be certain that the data are accurate. Errors or inaccuracies in the data could result in poor business decisions, resource allocation, or strategic initiatives. For example, if we overestimate traffic to our website and mobile application, we may not invest an adequate amount of resources in attracting new customers or we may hire more lead agents in a given market than necessary to meet customer demand.

We also use our business data and proprietary algorithms to inform our machine learning, such as in the calculation of our Redfin Estimate, which provides an estimate on the market value of individual homes. If customers disagree with us or if our Redfin Estimate fails to accurately reflect market pricing such that we are unable to attract homebuyers or help our customers sell their homes at satisfactory prices, or at all, customers may lose confidence in us.

If we are unable to deliver a rewarding experience on mobile devices, whether through our mobile website or mobile application, we may be unable to attract and retain customers.

Developing and supporting a mobile website and mobile application across multiple operating systems and devices requires substantial time and resources. We may not be able to consistently provide a rewarding customer experience on mobile devices and, as a result, customers we meet through our mobile website or mobile application may not choose to use our services at the same rate as customers we meet through our website.

As new mobile devices and mobile operating systems are released, we may encounter problems in developing or supporting our mobile website or mobile application for them. Developing or supporting our mobile website or mobile application for new devices and their operating systems may require substantial time and resources. The success of our mobile website and mobile application could also be harmed by factors outside of our control, such as:

•increased costs to develop, distribute, or maintain our mobile website or mobile application;

•changes to the terms of service or requirements of a mobile application store that requires us to change our mobile application development or features in an adverse manner; and

•changes in mobile operating systems, such as Apple’s iOS and Google’s Android, that disproportionately affect us, degrade the functionality of our mobile website or mobile application, require that we make costly upgrades to our technology offerings, or give preferential treatment to competitors' websites or mobile applications.

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We may be unable to attract homebuyers, home sellers, and rental customers to our websites and mobile applications in a cost-effective manner.

Our websites and mobile applications are our primary channels for meeting new customers. Accordingly, our success depends on our ability to attract homebuyers, home sellers, and rental customers to our websites and mobile applications in a cost-effective manner. To meet customers, we rely heavily on traffic generated from search engines and downloads of our mobile applications from mobile application stores. We also rely on marketing methods such as targeted email campaigns, paid search advertising, social media marketing, podcasts, and TV.

The number of visitors to our websites and downloads of our mobile applications depend in large part on how and where our website and mobile application rank in Internet search results and mobile application stores, respectively. While we use search engine optimization to help our website rank highly in search results, maintaining or improving our search result rankings is not within our control. Internet search engines frequently update and change their ranking algorithms, referral methodologies, or design layouts, which determine the placement and display of a user’s search results. In some instances, Internet search engines may change these rankings, which may have the effect of promoting their own competing services or the services of one or more of our competitors. Similarly, mobile application stores can change how they display searches and how mobile applications are featured. For instance, editors at the Apple App Store can feature prominently editor-curated mobile applications and cause the mobile application to appear larger than other applications or more visibly on a featured list.

Additionally, our marketing efforts may fail to attract the desired number of customers for a variety of reasons, including the possibility that the creative treatment for our advertisements may be ineffective or new third-party email delivery policies may make it more difficult for us to execute targeted email campaigns.

Our business model of employing lead agents subjects us to challenges not faced by our competitors. Our ability to hire and retain a sufficient number of lead agents is critical to our ability to maintain and grow our market share and to provide an adequate level of service to customers who want to work with our lead agents.

As a result of our business model of employing our lead agents, our lead agents generally earn less on a per transaction basis than traditional agents who work as independent contractors at traditional brokerages. Because our model is uncommon in our industry, agents considering working for us may not understand our employee agent model or may not perceive it to be more attractive than the independent contractor compensation model used by most traditional brokerages. Additionally, due to the costs of employing our lead agents, lead agent turnover may be more costly to us than to traditional brokerages. If we are unable to attract, retain, effectively train, motivate, and utilize lead agents, we will be unable to offset the costs of employing them and grow our business. We may also be required to change our compensation model, which could significantly increase our lead agent compensation or other costs.

Also, as a result of employing our lead agents, we incur costs that our brokerage competitors do not, such as employee benefits, expense reimbursement, training, and employee transactional support staff. Because of this, we have significant costs that, in the event of decreased demand in the markets we serve, may result in us being unable to adjust as rapidly as some of our competitors. In turn, such demand declines may impact us more than our competitors.

Conversely, in times of rapidly rising demand we may face a shortfall of lead agents. To the extent our customer demand increases from current levels, our ability to adequately serve the additional customers, and in turn grow our revenue and U.S. market share by value, depends, in part, on our ability to timely hire and retain additional lead agents. To the extent we are unable to hire, either timely or at all, or retain the required number of lead agents to serve our customer demand, we will be unable to maximize our revenue and market share growth. Although we are able to refer excess demand to our partner agents, historically our partner agents have closed transactions with customers they meet at a lower rate than our lead agents and have generated lower revenue per transaction.

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We may not achieve some or all of the expected benefits of our recently announced partnership with Zillow and restructuring of our rentals segment.

On February 6, 2025, we entered into a Content License Agreement (the “Content License”) with Zillow, Inc. (“Zillow”), pursuant to which Zillow will become the exclusive provider of listings for multifamily rental properties with more than 25 units to be listed on Redfin and its sites, Rent.com and ApartmentGuide.com. During the term of the Content License, Zillow will pay Redfin per lead delivered. We also entered into a Partnership Agreement (the “Partnership Agreement”) with Zillow to facilitate Zillow’s entry into advertising agreements with property management companies that currently advertise on our sites. In connection with these agreements, we also announced a planned restructuring of our rentals segment, which is expected to impact approximately 450 rentals employees and result in approximately $18 million and $21 million in total charges in connection therewith, which we expect to be completed by the quarter ending September 30, 2025. If we are unable to implement these agreements and the corresponding restructuring successfully in whole or in part, or should the partnership once implemented fail to produce the expected benefits, our financial results and business may be materially and adversely affected. Additionally, the restructuring may entail higher costs or take more time than anticipated.

Referring customers to our partner agents may harm our business.

We refer customers to third-party partner agents when we do not have a lead agent available due to high demand or geographic limitations. Our dependence on partner agents can be particularly heavy in certain new markets as we build our operations to scale in those markets or during times of rapidly rising demand for our services. Our partner agents are independent licensed agents affiliated with other brokerages, and we do not have any control over their actions. If our partner agents were to provide poor customer service, engage in malfeasance, or otherwise violate the laws and rules to which we are subject, we may be subject to legal claims and our reputation and business may be harmed.

Our arrangements with third-party partner agents may limit our growth and brand awareness. For example, referring customers to partner agents potentially redirects repeat and referral opportunities to the partner agents.

If we do not comply with the rules, terms of service, and policies of REALTOR® associations and MLSs, our access to and use of listings data may be restricted or terminated.

We must comply with the rules, terms of service, and policies of REALTOR® associations and MLSs to access and use MLSs' listings data. We belong to numerous REALTOR® associations and MLSs, and each has adopted its own rules, terms of service, and policies governing, among other things, how MLS data may be used and how listings data must be displayed on our website and mobile application. These rules typically do not contemplate multi-jurisdictional online brokerages like ours and vary widely among markets. They also are in some cases inconsistent with the rules of other REALTOR® associations and MLSs such that we are required to customize our website, mobile application, or service to accommodate differences between rules of REALTOR® associations and MLSs. Complying with the rules of each REALTOR® association and MLS requires significant investment, including personnel, technology and development resources, and the exercise of considerable judgment. In October 2023, Redfin began exiting local REALTOR® associations and the National Association of REALTORS® in some jurisdictions. We could be deemed to be noncompliant by not having these REALTOR® association memberships, or by having both REALTOR® and non-REALTOR® agents working at the same brokerage.

If we are deemed to be noncompliant with a REALTOR® association or MLS’s rules, we may face disciplinary sanctions in that association or MLS, which could include monetary fines, restricting or terminating our access to that MLS’s data, or other disciplinary measures. The loss or degradation of this listings data could materially and adversely affect traffic to our website and mobile application, making us less relevant to consumers and restricting our ability to attract customers. It also could reduce agent and customer confidence in our services and harm our business.

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If we fail to comply with the requirements governing the licensing of our brokerage, mortgage, and title businesses in the jurisdictions in which we operate, then our ability to operate those businesses in those jurisdictions may be revoked.

Redfin, as a brokerage, and our agents must comply with the requirements governing the licensing and conduct of real estate brokerage and brokerage-related businesses in the markets where we operate. Furthermore, we are also required to comply with the requirements governing the licensing and conduct of mortgage and title and settlement businesses in the markets where we operate. Due to the geographic scope of our operations, we and our agents may not be in compliance with all of the required licenses at all times. Additionally, if we enter into new markets, we may become subject to additional licensing requirements. If we or our agents fail to obtain or maintain the required licenses for conducting our brokerage, mortgage, rentals, and title businesses or fail to strictly adhere to associated regulations, the relevant government authorities may order us to suspend relevant operations or impose fines or other penalties.

It’s possible that the net proceeds Bay Equity receives from the sale of mortgage loans it originates may not exceed the loan amount. Additionally, Bay Equity may also be unable to sell its originated loans at all. In that situation, Bay Equity will need to service the loans and potentially foreclose on the home by itself or through a third party, and either option could impose significant costs, time, and resources on Bay Equity. Bay Equity’s inability to sell its originated loans could also expose us to adverse market conditions affecting mortgage loans.

Bay Equity intends to sell most of the mortgage loans that it originates to investors in the secondary mortgage market. Bay Equity's ability to sell its originated loans in the secondary market, and receive net proceeds from the sale that exceed the loan amount, depends largely on there being sufficient liquidity in the secondary market and its compliance with contracts with investors who have purchased the loans.

Demand in the secondary market for mortgage loans, and Bay Equity’s ability to sell the mortgage loans that it originates on favorable terms and in a timely manner, can be hindered by many factors, including changes in regulatory requirements, the willingness of the agencies, aggregators, or other investors to provide funding for and purchase mortgage loans, and general economic conditions. If Bay Equity were unable to sell its originated loans, either initially or following a repurchase, then it may need to service the loans and we would be exposed to adverse market conditions affecting mortgage loans. For example, we may be required to write down the value of the loan, which reduces the amount of our current assets. Additionally, if Bay Equity borrowed under a warehouse credit facility for the loan, then it will be required to repay the borrowed amount, which reduces our cash on hand that is available for other corporate uses. Finally, if a homeowner were unable to make his or her mortgage payments, then we may be required to foreclose on the home securing the loan. Bay Equity may be unable to retain its subservicer on economically feasible terms to foreclose a home. Furthermore, any proceeds from selling a foreclosed home may be significantly less than the remaining amount of the loan due to Bay Equity.

We may not realize the anticipated benefits from, and may incur substantial costs related to, our acquisitions of Rent. and Bay Equity.

We acquired Rent. on April 2, 2021 and Bay Equity on April 1, 2022. The anticipated benefits of each acquisition may not come to fruition. The ongoing integration of Rent. and Bay Equity continues to be challenging and time consuming, and may subject us to additional costs that we have not anticipated in evaluating the transaction. Furthermore, GAAP requires us to test the goodwill associated with these acquisitions at least annually and we review our goodwill and intangible assets for impairment when events change and indicate that an impairment may be appropriate. Depending on the results of these reviews, we may be required to record a non-cash charge to our earnings in the period we determined impairment was appropriate, which may negatively impact our results of operations in that period.

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Cybersecurity incidents could disrupt our business or result in the loss of critical and confidential information.

Cybersecurity incidents directed at us or our third-party service providers can range from uncoordinated individual attempts to gain unauthorized access to information technology systems to sophisticated and targeted measures known as advanced persistent threats. Cybersecurity incidents are also constantly evolving, including the increase in more sophisticated types of phishing, ransomware, or malware attacks, which might interfere with our ability to detect and successfully defend against them. In the ordinary course of our business, we and our third-party service providers collect and store sensitive data, including our proprietary business information, intellectual property and data of our customers and employees, including personally identifiable information. Additionally, we rely on third parties and their security procedures for the secure storage, processing, maintenance, and transmission of information that are critical to our operations. Despite measures designed to prevent, detect, address, and mitigate cybersecurity incidents, such incidents may target us or our third-party providers and, depending on their nature and scope, could potentially result in the misappropriation, destruction, corruption, or unavailability of critical data and confidential or proprietary information (our own or that of third parties, including personally identifiable information of our customers, employees, and independent contractors) and the disruption of business operations. Any real or perceived compromises to our security, or that of our third-party providers, could cause customers to lose trust and confidence in us and stop using our website and mobile applications. In addition, we may incur significant costs for remediation that may include liability for stolen assets or information, repair of system damage, and compensation to customers, employees, and business partners. We may also be subject to government enforcement proceedings and legal claims by private parties.

We process, transmit, and store personal information, and unauthorized access to, or the unintended release of, this information could result in a claim for damages, regulatory action, loss of business, or unfavorable publicity.

We process, transmit, and store personal information to provide services to our customers and as an employer. As a result, we are subject to certain contractual terms, as well as federal, state, and foreign laws and regulations designed to protect personal information. While we take measures to protect the security and privacy of this information, it is possible that our security controls over personal data and other practices we follow may not prevent the unauthorized access to, or the unintended release of, personal information. If such unauthorized access or unintended release occurred, we could suffer significant damage to our brand and reputation, customers could lose confidence in the security and reliability of our services, and we could incur significant costs to address and fix these security incidents. These incidents could also lead to lawsuits and regulatory investigations and enforcement actions.

Privacy, data protection, and data usage laws and regulations are complex and rapidly evolving. Any failure or alleged failure to comply with these laws could result in a claim for damages, regulatory action, loss of business, or unfavorable publicity.

We use evolving tools and technology, such as pixels, in the operation of our websites. We are from time to time involved in, and may in the future be subject to, enforcement actions and private third-party claims arising from the laws to which we are subject. This includes third party claims relying on older legislation as the basis for allegations of consumer data privacy violations against companies using new technology. Companies using tracking technology, including Redfin, have been the subjects of recent data privacy lawsuits brought by third-parties alleging that the use of this modern technology violates consumer privacy as defined by older laws. Many of these lawsuits have not been fully litigated, or have settled, resulting in a current state of uncertainty in the law. In addition, many cyber carriers are reconsidering how, and if, to cover losses related to pixel-based claims. Our use of such technology could subject us to expensive litigation, and to greater loss exposure due to insurance limits.

We rely on third-party licensed technology, and the inability to maintain these licenses or errors in the software we license could result in increased costs or reduced service levels.

We use certain licensed third-party software in our technology. Our reliance on this third-party software may become costly if the licensor increases the price for the license or changes the terms of use and we cannot find commercially reasonable alternatives. Even if we were to find an alternative, integration of our technology with new third-party software may require substantial investment of our time and resources.

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Any undetected errors or defects in the third-party software we license could prevent the deployment or impair the functionality of our technology, delay new service offerings, or result in a failure of our website or mobile application.

For example, we host our website and mobile applications using Amazon Web Services (“AWS”). A prolonged AWS service disruption affecting our website and mobile applications would negatively impact our ability to serve our customers and could damage our reputation with current and potential customers, expose us to liability, cause us to lose customers, or otherwise harm our business. In the event that our AWS service agreements are terminated, or there is an interruption or lapse of service, or elimination of AWS services or features that we use, we could experience interruptions in access to our subscription offerings as well as significant delays and additional expense in changing to a different cloud infrastructure provider and re-architecting our website and mobile applications for deployment on a different cloud infrastructure service provider. This could materially adversely affect our business, results of operations and financial condition.

Our fraud detection processes and information security systems may not successfully detect all fraudulent activity by third parties aimed at our employees or customers, which could adversely affect our reputation and business results.

Third-party actors have attempted in the past, and may attempt in the future, to conduct fraudulent activity by engaging with our customers by, for example, posting fake real estate and rental listings on our sites, including our Redfin Rental Tools platform, and attempting to solicit personal information or money from customers, and by engaging with our employees by, for example, making fake requests for transfer of funds or sensitive information. We make a large number of wire transfers in connection with loan and real estate closings and process sensitive personal data in connection with these transactions. Though we have sophisticated fraud detection processes and have taken other measures to identify fraudulent activity on our mobile applications, websites and internal systems, we may not be able to detect and prevent all such activity. Similarly, the third parties we use to effectuate these transactions may fail to maintain adequate controls or systems to detect and prevent fraudulent activity. Persistent or pervasive fraudulent activity may cause customers and business partners to lose trust in us and decrease or terminate their usage of our services, or could result in financial loss and harm our business.

We use open source software in some aspects of our technology and may fail to comply with the terms of one or more of these open source licenses.

Our technology incorporates software covered by open source licenses. The terms of various open source licenses have not been interpreted by U.S. courts, and if they were interpreted, such licenses could be construed in a manner that imposes unanticipated restrictions on our technology. If portions of our proprietary software are determined to be subject to an open source license, we could be required to publicly release the affected portions of our source code, re-engineer all or a portion of our technologies, or otherwise be limited in our use of such software, each of which could reduce or eliminate the value of our technologies.

Moreover, our processes for controlling our use of open source software may not be effective. If we do not comply with the terms of an open source software license, we could be required to seek licenses from third parties to continue offering our services on terms that are not economically feasible, to re-engineer our technology to remove or replace the open source software, to discontinue the use of certain technology if re-engineering could not be accomplished on a timely basis, to pay monetary damages, to make generally available the source code for our proprietary technology, or to waive certain intellectual property rights.

We may be unable to secure intellectual property protection for all of our technology and methodologies, enforce our intellectual property rights, or protect our other proprietary business information.

Our success and ability to compete depends in part on our intellectual property and our other proprietary business information. To protect our proprietary rights, we rely on trademark, copyright, and patent law, trade-secret protection, and contractual provisions and restrictions. However, we may be unable to secure intellectual property protection for all of our technology and methodologies or the steps we take to enforce our intellectual property rights may be inadequate. Furthermore, we may also be unable to protect our proprietary business information from misappropriation.

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If we are unable to secure intellectual property rights, our competitors could use our intellectual property to market offerings similar to ours and we would have no recourse to enjoin or stop their actions. Additionally, any of our intellectual property rights may be challenged by others and invalidated through administrative processes or litigation. Moreover, even if we secured our intellectual property rights, others may infringe on our intellectual property and we may be unable to successfully enforce our rights against the infringers because we may be unaware of the infringement or our legal actions may not be successful. Finally, others may misappropriate our proprietary business information, and we may be unaware of the misappropriation or unable to enforce our legal rights in a cost-effective manner. If any of these events were to occur, our ability to compete effectively would be impaired.

We are subject to a variety of federal, state and local laws, and our compliance with these laws, or the enforcement of our rights under these laws, may increase our expenses, require management's resources, or force us to change our business practices.

We are currently subject to a variety of, and may in the future become subject to additional, federal, state, and local laws. The laws include, but are not limited to, those relating to real estate, brokerage, title, mortgage, advertising, privacy, competition, and consumer protection, labor and employment, and intellectual property. These laws and their related regulations may evolve frequently and may be inconsistent from one jurisdiction to another. Additionally, certain of these laws and regulations were created for traditional real estate brokerages, and it may be unclear how they affect us given our business model that is unlike traditional brokerages or certain of our services that historically have not been offered by traditional brokerages.

These laws can be costly for us to comply with or enforce. Additionally, if we are unable to comply with and become liable for violations of these laws, or if courts or regulatory bodies provide unfavorable interpretations of existing regulations, our operations in affected markets may become prohibitively expensive, consume significant amounts of management's time, or need to be discontinued.

We are subject to costs associated with defending and resolving proceedings brought by government entities and claims brought by private parties.

We are from time to time involved in, and may in the future be subject to, government investigations or enforcement actions and private third-party claims arising from the laws to which we are subject or the contracts to which we are a party. Such investigations, actions, and claims include, but are not limited to, matters relating to employment law (including misclassification), intellectual property, privacy and data protection, consumer protection, website accessibility, competition and antitrust laws, the Real Estate Settlement Procedures Act of 1974, the Fair Housing Act of 1968 or other fair housing statutes, cybersecurity incidents, data breaches, and commercial or contractual disputes. They may also relate to disputes, including, but not limited to, failure to disclose property defects, failure to meet client legal obligations, negligence, commission disputes, personal injury or property damage claims, and vicarious liability based upon conduct of individuals or entities outside of our control, including partner agents, third-party contractor agents, clients, and users of Redfin’s sites or products. See Note 7 to our consolidated financial statements for a discussion of pending third-party claims that we believe may be material to us.

Any such investigations, actions, or claims can be costly to defend or resolve, require significant time from management, or result in negative publicity. Furthermore, to the extent we are unsuccessful in defending an action or claim, we may be subject to civil or criminal penalties, including significant fines or damages, the loss of ability to operate in a jurisdiction, or the need to change certain business practices (including redesigning, or obtaining a license for, our technology or modifying or ceasing to offer certain services). Misclassification claims may also require us to reclassify independent contractor associate agents as employees, thereby subjecting them to wage and hour laws, and resulting in related tax and employment liabilities. Agents may also opt out of our platform given the loss of flexibility under an employment model.

The real estate market may be severely impacted by industry changes as the result of certain class action lawsuits, settlements, or government investigations.

The real estate industry faces significant pressure from private lawsuits and investigations by the Department of Justice (the “DOJ”) into antitrust issues.

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In April 2019, the National Association of REALTORS® (“NAR”) and certain brokerages and franchisors (including Realogy Holdings Corp., HomeServices of America, Inc. RE/MAX, and Keller Williams Realty, Inc.) were named as defendants in a class action complaint in federal district court for the Western District of Missouri alleging a conspiracy to violate federal antitrust laws by, among other things, requiring residential property sellers in Missouri to pay inflated commission fees to buyer brokers (the “NAR Class Action”). On October 31, 2023, a jury found NAR and various of its co-defendants liable and awarded plaintiffs nearly $1.8 billion in damages (an award that was subject to trebling). Class action suits raising similar claims are already pending in this and other jurisdictions and the outcome of the NAR Class Action may result in additional such actions being filed. Redfin has been named as one of several defendants in similar putative class action suits as described under the caption “Lawsuits Alleging Antitrust Violations” above under Item 8, Note 7: Commitments and Contingencies.

On May 3, 2024, we entered into a settlement term sheet (the “Proposed Settlement”) and on June 26, 2024, we executed a settlement agreement (the “Settlement Agreement”) to resolve, on a nationwide basis, all claims asserted in two of those lawsuits pending in the United States District Court for the Western District of Missouri (the “Gibson Action” and the “Umpa Action” each as defined under Item 8, Note 7). The Settlement Agreement resolves all claims in those two lawsuits and similar claims on behalf of home sellers (including those who sold and bought a home) (subject to opt-outs and objections) on a nationwide basis against Redfin (the “Claims”) and releases Redfin, its subsidiaries, and its employees and contractors from the Claims. Neither the Proposed Settlement nor the Settlement Agreement include any admissions of liability.

Under the Settlement Agreement, Redfin paid $9.3 million (the “Settlement Amount”) into a qualified settlement fund on August 26, 2024. The Settlement Amount is included in other current assets and accrued and other liabilities in our consolidated balance sheets as of December 31, 2024. In the first quarter of 2024, we recorded the Settlement Amount to general and administrative in our consolidated statements of comprehensive loss. Redfin also agreed to implement or continue certain practices outlined in the Settlement Agreement.

On July 15, 2024, the United States District Court for the Western District of Missouri issued an Order Granting Preliminary Approval of the Settlement Agreement and the court entered an Order granting final approval of the Settlement Agreement on November 4, 2024. On December 3, 2024, a member of the proposed settlement class filed a notice of appeal, appealing the court’s order granting final approval of the Settlement Agreement. On December 16, 2024, additional members of the settlement class separately appealed. The appeals are currently pending before the United States Court of Appeals for the Eighth Circuit.

The district court’s order granting final approval of the Settlement Agreement may be overturned by the United States Court of Appeals for the Eighth Circuit and, if so, we may be forced to continue litigating the Gibson Action and Umpa Action, as well as other similar class action suits. Defending against class action litigation is costly, may divert time and money away from our operations, and imposes a significant burden on management and employees. Also, the results of any such litigation or investigation cannot be predicted with certainty, and any negative outcome could result in payments of substantial monetary damages or fines, and/or undesirable changes to our operations or business practices, and accordingly, our business, financial condition, or results of operations could be materially and adversely affected.

On March 15, 2024, NAR entered a settlement agreement to resolve on a class-wide basis the claims against NAR in the NAR Class Action. In addition to a monetary payment of $418 million, NAR agreed to change certain business practices, including changes to cooperative compensation and buyer agreements. The NAR settlement agreement: (1) prohibits NAR and REALTOR® MLSs from requiring that listing brokers or sellers make offers of compensation to buyer brokers or other buyer representatives; (2) prohibits NAR, REALTOR® MLSs and MLS participants from making an offer of compensation on the MLS; and (3) requires all REALTOR® MLS participants to enter into a written buyer agreement specifying compensation before taking a buyer on tour. The NAR settlement received preliminary court approval on April 23, 2024 and final court approval on November 27, 2024. Several notices of appeal have been filed, appealing the court’s order granting final approval of the NAR settlement. The matter is currently pending before the United States Court of Appeals for the Eighth Circuit.

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These revised NAR rules and practices went into effect on August 17, 2024. The revised NAR rules and practices may require changes to our business model, including changes to agent and broker compensation and how we meet home buyers. Without mandated commission sharing, for example, we may see the introduction of hourly or a la carte services. Or, if buyers now compensate brokers, they may be more likely to contact listing agents directly, which could drive down dual agent broker commissions. Home lending rules and norms do not currently allow buyers to include buyer’s agent compensation in the balance of a home loan, which may impair the ability of homebuyers to pay their agent fees when purchasing a home. The amended rules and regulations requiring us to get a buyer agreement signed before we take a home buyer on a first tour may dissuade buyers from hiring Redfin, thereby reducing the fees we receive from our agents. These and other shifts in the model for agent and broker compensation could significantly change the brokerage landscape overall and may adversely affect our financial condition and results of operations. In addition, given that these matters remain subject to appeal, it is possible that the revised rules and practices may be subject to additional changes in the future, including the potential that they may be rolled back in whole or in part.

In addition to the NAR Class Action and various similar private actions already pending, beginning in 2018, the DOJ began investigating NAR for violations of the federal antitrust laws. The DOJ and NAR appeared to reach a resolution in November 2020, resulting in the filing of a Complaint and Proposed Consent Judgment pursuant to which NAR agreed to adopt certain rule changes, such as increased disclosure of commission offers. The DOJ has since sought to continue its investigation of NAR, and on April 5, 2024, a federal appeals court decided that the DOJ could reopen its investigation. On October 10, 2024, NAR filed a petition for writ of certiorari, asking the Supreme Court of the United States to review the federal appeals court’s decision. On January 13, 2025, the Supreme Court of the United States denied NAR’s petition for certiorari. The DOJ may expand its investigations into the practices of individual local REALTOR® associations or MLSs. This could result in further changes to industry standards or brokerage operations in some or all of our markets. It is uncertain what effect, if any, the resumption of the DOJ’s investigation could have on the larger real estate industry, including any further government enforcement action, private litigation, or settlement that may result therefrom.

Risks Related to Our Indebtedness

Our term loan facility provides our lenders with a first-priority lien against substantially all of our and our subsidiaries’ assets, and contains financial covenants and other restrictions on our actions, which could limit our operational flexibility and otherwise adversely affect our financial condition.

Our term loan facility restricts our ability to, among other things:

•use our accounts receivable, inventory, trademarks and most of our other assets as security in other borrowings or transactions;

•incur additional indebtedness, except for (i) indebtedness secured on a pari passu basis in an amount up to $50,000,000, (ii) indebtedness secured on a junior and subordinated basis or subordinated in right of payment to our senior lenders, and (iii) unsecured indebtedness;

•incur liens upon our property;

•dispose of certain assets;

•purchase or acquire equity interests;

•declare dividends or make certain distributions;

•enter into related party transactions; and

•undergo a merger or consolidation or other transactions.

Our term loan facility also requires that we maintain aggregate consolidated liquidity (defined as unrestricted cash plus cash equivalents) of $75.0 million, tested on a quarterly basis. Our ability to comply with these and other covenants is dependent upon several factors, some of which are beyond our control.

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Our failure to comply with the covenants or payment requirements, or the occurrence of other events specified in our term loan facility, could result in an event of default under the term loan facility, which would give our lenders the right to terminate their commitments to provide additional loans under the term loan facility and to declare all borrowings outstanding, together with accrued and unpaid interest and fees, to be immediately due and payable. In addition, we have granted our lenders first-priority liens against substantially all of our and our subsidiaries’ assets as collateral (other than the assets of our subsidiary Bay Equity LLC). Failure to comply with the covenants or other restrictions in the term loan facility could result in a default. If the debt under our term loan facility was to be accelerated, we may not have sufficient cash on hand or be able to sell sufficient collateral to repay it, which would have an immediate adverse effect on our business and operating results.

We may not have sufficient cash flow to make the payments required under our current indebtedness, and a failure to make payments when due may result in the entire principal amount of our indebtedness becoming due prior to maturity, which may result in our bankruptcy.

Our ability to make scheduled payments of the principal of or to pay interest on our indebtedness, including amounts payable under our 2027 notes and any borrowings under our term loan facility or other future indebtedness, depends on having sufficient cash on hand when the payments are due. Our cash availability, in turn, depends on our future performance, which is subject to the other risks described in Item 1A. If we are unable to generate sufficient cash flow to make the payments when due, then we may be required to adopt one or more alternatives, such as selling assets, refinancing the notes, or raising additional capital. However, we may not be able to engage in any of these activities or engage in these activities on desirable terms, which could result in a default on our debt obligations.

In addition, holders of our convertible senior notes have the right to require us to repurchase their notes upon the occurrence of a fundamental change at a repurchase price equal to 100% of the principal amount of the notes to be repurchased, plus any accrued and unpaid interest. Furthermore, holders of our notes have the right to convert their notes upon any of the conditions described below:

•during any calendar quarter, if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price of the notes on each applicable trading day;

•during the five business day period after any five consecutive trading day period in which the trading price per $1,000 principal amount of the notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate of the notes on each such trading day;

•if we call any or all of the notes for redemption, at any time prior to the close of business on the scheduled trading day prior to the redemption date; or

•upon the occurrence of specified corporate events.

If any of these conversion features under a tranche of our notes are triggered, then holders of such notes will be entitled to convert the notes at any time during specified periods at their option. Upon conversion, we will be required to make cash payments in respect of the notes being converted, unless we elect to deliver solely shares of our common stock to settle such conversion (other than paying cash in lieu of delivering any fractional share).

In addition, our term loan facility prohibits us from making any cash payments on the conversion or repurchase of our notes if an event of default exists under our term loan facility or if, after giving effect to such conversion or repurchase, we would not be in compliance with the financial covenants under our term loan facility. Our failure to make payments when due may result in an event of default under the indentures governing our convertible senior notes and cause (i) with respect to our 2025 notes, the remaining $73.8 million aggregate principal amount, and (ii) with respect to our 2027 notes, the entire $503.1 million aggregate principal amount, plus, in each case, any accrued and unpaid interest, to become due immediately and prior to the maturity date, and may further result in a default under our term loan facility. Any acceleration of the amounts outstanding under our indebtedness could result in our bankruptcy. In a bankruptcy, our term loan lender first, and the holders of our convertible senior notes second, would have a claim to our assets senior to the claims of holders of our common stock.

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A substantial portion of our mortgage business’s assets are measured at fair value. If our estimates of fair value are inaccurate, we may be required to record a significant write down of our assets.

Bay Equity’s mortgage servicing rights (“MSRs”), interest rate lock commitments (“IRLCs”), and mortgage loans held for sale are recorded at fair value on our balance sheet. Fair value determinations require many assumptions and complex analyses, and we cannot control many of the underlying factors. If our estimates are incorrect, we could be required to write down the value of these assets, which could adversely affect our financial condition and results of operations.

In particular, our estimates of the fair value of Bay Equity’s MSRs are based on the cash flows projected to result from the servicing of the related mortgage loans and continually fluctuate due to a number of factors, including estimated discount rate, the cost of servicing, objective portfolio characteristics, contractual service fees, default rates, prepayment rates and other market conditions that affect the number of loans that ultimately become delinquent or are repaid or refinanced. These estimates are calculated by a third party using financial models that account for a high number of variables that drive cash flows associated with MSRs and anticipate changes in those variables over the life of the MSR. The accuracy of our estimates of the fair value of our MSRs are dependent on the reasonableness of the results of such models and the variables and assumptions that are built into them. If prepayment speeds or loan delinquencies are higher than anticipated, or other factors perform worse than modeled, the recorded value of certain of our MSRs may decrease, which could adversely affect our financial condition and results of operations.

Bay Equity relies on its warehouse credit facilities to fund the mortgage loans that it originates. If one or more of those facilities were to become unavailable, Bay Equity may be unable to find replacement financing on commercially reasonable terms, or at all, and this could adversely affect its ability to originate additional mortgage loans.

Bay Equity relies on borrowings from warehouse credit facilities to fund substantially all of the mortgage loans that it originates. To grow its business, Bay Equity depends, in part, on having sufficient borrowing capacity under its current facilities or obtaining additional borrowing capacity under new facilities. A current facility may become unavailable if Bay Equity fails to comply with its ongoing obligations under the facility or if it cannot agree with the lender on terms to renew the facility. New facilities may not be available on terms acceptable to us. If Bay Equity were unable to secure sufficient borrowing capacity through its warehouse credit facilities, then it may need to rely on our cash on hand to originate mortgage loans. If this cash were unavailable, then Bay Equity may be unable to maintain or increase the amount of mortgage loans that it originates, which will adversely affect its growth.

Each warehouse credit facility contains various restrictive and financial covenants and provides that Bay Equity’s breach or failure to satisfy certain of such covenants constitutes an event of default. In part due to decreased demand in the broader mortgage industry, occasionally Bay Equity may be unable to satisfy certain of these financial covenants. While lenders may waive any breaches of the financial covenants, there is no assurance that every lender will do so. If we were unable to secure a waiver of an event of default from an applicable lender, and such lender determines to enforce is remedies under the applicable warehouse facility, then Bay Equity may lose a portion of its assets, including pledged mortgage loans, and would be unable to rely on such facility to fund its mortgage originations, which may adversely affect Bay Equity’s business. This could trigger similar cross-defaults of Bay Equity’s other warehouse facilities.

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The cross-acceleration and cross-default provisions in the agreements governing our current indebtedness may result in an immediate obligation to repay all of either our 2025 and 2027 convertible senior notes, our warehouse credit facilities, or our term loan facility.

The indentures governing our 2025 and 2027 convertible senior notes contain cross-acceleration and cross-default provisions. These provisions could have the effect of creating an event of default under the indenture for either our 2025 or 2027 convertible senior notes, despite our compliance with that agreement, due solely to an event of default or failure to pay amounts owed under the indenture for the other tranche of convertible senior notes. Accordingly, all or a significant portion of our outstanding convertible senior notes could become immediately payable due solely to our failure to comply with the terms of a single agreement governing either our 2025 or 2027 convertible senior notes. In addition, each of our warehouse credit facilities and term loan facility contain cross-acceleration and cross-default provisions. These provisions could have the effect of creating an event of default under the agreement for any such facility, despite our compliance with that agreement, due solely to an event of default or failure to pay amounts owed under the agreement for another facility. Accordingly, all or a significant portion of our outstanding warehouse indebtedness or outstanding term loan indebtedness could become immediately payable due solely to our failure to comply with the terms of a single agreement governing one of our facilities. While the cross-default provisions in our existing warehouse credit facilities do not pick up defaults under our convertible senior notes and our existing warehouse credit facilities are carved out of the cross-payment default provisions in our 2025 and 2027 senior notes given that they constitute non-recourse debt, any default under our convertible senior notes would trigger an event of default under our term loan facility and, similarly, any default under our term loan facility would trigger the cross-payment default provisions in our 2025 and 2027 senior notes.

Risks Relating to Ownership of Our Common Stock

Our restated certificate of incorporation designates the Court of Chancery of the State of Delaware and the U.S. federal district courts as the exclusive forums for certain types of actions that may be initiated by our stockholders. These provisions may limit a stockholder's ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or employees, which may discourage lawsuits with respect to such claims.

Our restated certificate of incorporation provides that, unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers, or employees to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our restated certificate of incorporation, or our restated bylaws, (iv) any action to interpret, apply, enforce or determine the validity of our restated certificate of incorporation or our restated bylaws, or (v) any action asserting a claim that is governed by the internal affairs doctrine. This exclusive forum provision does not apply to actions arising under the Securities Exchange Act of 1934, or, as described below, the Securities Act of 1933.

Our restated certificate of incorporation further provides that, unless we consent in writing to an alternative forum, the U.S. federal district courts will be the exclusive forum for any complaint asserting a cause of action arising under the Securities Act of 1933. Notwithstanding this provision, stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.

Item 1B. Unresolved Staff Comments

None.

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Item 1C. Cybersecurity

Overview

Our board of directors (the “Board”) recognizes the critical importance of maintaining the trust and confidence of our customers, business partners, stockholders, and employees. Our audit committee oversees our risk management program, and cybersecurity represents an important component of our overall approach to enterprise risk management (“ERM”). Our cybersecurity policies, standards, processes and practices are fully integrated into our ERM program and are based on recognized frameworks established by the National Institute of Standards and Technology, the International Organization for Standardization, and other applicable industry standards. We seek to address cybersecurity risks through a comprehensive, cross-functional approach that focuses on preserving the confidentiality, security and availability of the information that we collect and store by identifying, preventing and mitigating cybersecurity threats and effectively responding to cybersecurity incidents when they occur.

Risk Management and Strategy

As one of the critical elements of our overall ERM approach, our cybersecurity program is focused on the following key areas:

Governance—Our audit committee oversees our ERM program, including the management of risks arising from cybersecurity threats, and are supported by the Information Security Steering Committee (the “ISSC”), the Cybersecurity Incident Response Team (the “CSIRT”), and our information security (“InfoSec”) team. Our audit committee receives presentations and reports on cybersecurity risks, which address a wide range of topics including recent developments, evolving standards, vulnerability assessments, third-party and independent reviews, the threat environment, technological trends and information security considerations arising with respect to our peers and third parties. The ISSC oversees the frameworks the InfoSec team uses to benchmark the controls and maturity of our security program. The ISSC is a cross-functional group that has oversight and input into the roadmap and projects reflecting the maturity benchmarks of the frameworks upon which we base our program, and receives monthly updates as to the status of the roadmap projects. The CSIRT monitors the prevention, detection, mitigation and remediation of cybersecurity threats and incidents in real time, and reports such threats and incidents to the ISSC, who then reports up to our audit committee when appropriate. The audit committee is responsible for escalating cybersecurity threats and incidents to the Board if and when appropriate. We have established frameworks so that our ISSC, audit committee, and board of directors also receive prompt and timely information regarding any cybersecurity incident that meets established reporting thresholds, as well as ongoing updates regarding any such incident until it has been addressed.

To facilitate the success of our cybersecurity risk management program, the CSIRT is composed of multidisciplinary teams throughout Redfin who are deployed to address cybersecurity threats and to respond to cybersecurity incidents. The audit committee consists of at least three members of the Board. The ISSC includes our chief financial officer (“CFO”), our chief legal officer (“CLO”), and other key leaders across the company. Our chief technology officer (“CTO”) oversees our security team. Our CFO has over 30 years of experience managing risks at Redfin, Zappos, Amazon (Home and Garden), Bain & Company and Accenture, including risks arising from cybersecurity threats. Our CLO has 16 years of experience managing risks, including risks arising from cybersecurity threats. Our CTO has over 24 years of experience, including experience managing risks arising from cybersecurity threats across several industries to include health care and business solutions. Our Director of Security has 17 years of experience building and leading cybersecurity teams at Microsoft, Ubisoft, and Citrix Systems.

Collaborative Approach—We have implemented a comprehensive, cross-functional approach to identifying, preventing and mitigating cybersecurity threats and incidents, while also implementing controls and procedures that provide for the prompt escalation of certain cybersecurity incidents, so that decisions regarding the public disclosure and reporting of such incidents can be made in a timely manner. The ISSC and the CSIRT work collaboratively to build and implement a program designed to protect our information systems from cybersecurity threats and to promptly respond to any cybersecurity incidents in accordance with our incident response and recovery plans.

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Technical Safeguards—We deploy technical safeguards that are designed to protect our information systems from cybersecurity threats, including rate-limiting and web application firewalls, anti-malware and anti-phishing technology, access controls, and threat detection systems including posture management tooling. We conduct regular security reviews of our technical components, code, libraries, and environments.

Incident Response and Recovery Planning—We maintain incident response and recovery plans that address our response to a cybersecurity incident. These plans are tested and evaluated on a regular basis.

Third-Party Risk Management—We maintain a risk-based approach to identifying and overseeing cybersecurity risks presented by third parties, including vendors, service providers and other external users of our systems, as well as the systems of third parties that could adversely impact our business in the event of a cybersecurity incident affecting those third-party systems.

Education and Awareness—We provide mandatory training for our personnel regarding cybersecurity threats as a means to equip our employees with effective tools to address cybersecurity threats, and to communicate our evolving information security policies, standards, processes and practices. We engage in the periodic assessment and testing of our policies, standards, processes and practices that are designed to address cybersecurity threats and incidents. These efforts include a wide range of activities, including audits, assessments, tabletop exercises, threat modeling, vulnerability testing and other exercises focused on evaluating the effectiveness of our cybersecurity measures and planning. We regularly engage third parties to perform assessments on our cybersecurity measures, including information security maturity assessments, audits and independent reviews of our information security control environment and operating effectiveness. We report the results of these assessments, audits and reviews to the ISSC, the audit committee, and the Board, and we adjust our cybersecurity policies, standards, processes and practices as necessary based on the information provided by these assessments, audits and reviews.

Insurance—We maintain cyber insurance coverage.

Risks from Cybersecurity Threats

To date we have not experienced any cybersecurity incidents that have materially affected or are reasonably likely to affect our business, including our business strategy, results of operations or financial condition.

Item 2. Properties

None.

Item 3. Legal Proceedings

See "Legal Proceedings" under Note 7 to our consolidated financial statements for a discussion of our material, pending legal proceedings.

Item 4. Mine Safety Disclosures

Not applicable.

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PART II

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information, Holders of Record, and Dividends

Our common stock is listed on The Nasdaq Global Select Market under the symbol “RDFN.”

As of February 19, 2025, we had 203 holders of record of our common stock. Because many of our shares of common stock are held by brokers and other institutions on behalf of stockholders, we are unable to estimate the total number of beneficial owners of our common stock represented by these record holders.

The holders of our convertible preferred stock are entitled to dividends, which accrue daily based on a 360-day fiscal year at a rate of 5.5% per annum based on the issue price and are payable quarterly in arrears on the first business day following the end of each calendar quarter. Assuming we satisfy certain conditions, we will pay dividends in shares of common stock at a rate of the dividend payable divided by $17.95. If we do not satisfy such conditions, we will pay dividends in a cash amount equal to (1) the dividend shares otherwise issuable on the dividends multiplied by (2) the volume-weighted average closing price of our common stock for the ten trading days preceding the date the dividends are payable. Except for the foregoing, we have no intention of paying cash dividends in the foreseeable future.

Stock Performance Graph

The graph below compares the cumulative total return of a $100 investment in our common stock with the cumulative total return of the same investment in the S&P 500 Index and the RDG Composite Index. The period shown commences on December 31, 2018, which was the year in which our common stock first started trading after our initial public offering ("IPO"), and ends on December 31, 2024.

Unregistered Sales of Securities

During the period covered by this annual report, we did not sell any equity securities that were not registered under the Securities Act of 1933.

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Purchases of Equity Securities

During the quarter ended December 31, 2024, there were no purchases of our common stock by or on behalf of us or any of our affiliated purchasers, as such term is defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934. As part of the mandatory redemption of our convertible preferred stock, the following activity occurred during the quarter ended December 31, 2024:


Period	(a) Total number of shares purchased	(b) Average price paid per share	(c) Total number of shares purchased as part of publicly announced plans or programs	(d) Maximum number of shares that may yet be purchased under the plans or programs
October 1-31, 2024	—	—	—	—
November 1-30, 2024	40,000	$1,000	—	—
December 1-31, 2024	—	—	—	—

(a) 40,000 shares were repurchased through the mandatory redemption of our convertible preferred stock, not through a publicly announced plan or program. See Note 10 for more details.

Item 6. [Reserved]

Not applicable.

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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read together with our consolidated financial statements, the accompanying notes, and other information included in this annual report. In particular, the risk factors contained in Item 1A may reflect trends, demands, commitments, events, or uncertainties that could materially impact our results of operations and liquidity and capital resources.

The following discussion contains forward-looking statements, such as statements regarding our future operating results and financial position, our business strategy and plans, our market growth and trends, and our objectives for future operations. See "Note Regarding Forward-Looking Statements" for more information about relying on these forward-looking statements. The following discussion also contains information using industry publications. See "Note Regarding Industry and Market Data" for more information about relying on these industry publications.

When we use the term "basis points" in the following discussion, we refer to units of one‑hundredth of one percent.

Overview

Our mission is to redefine real estate in the consumer’s favor.

Adverse Macroeconomic Conditions and Our Associated Actions

Beginning in the second quarter of 2022 and continuing through the fourth quarter of 2024, a number of economic factors adversely impacted the residential real estate market, including higher mortgage interest rates, lower consumer sentiment, and increased inflation. This shift in the macroeconomic backdrop adversely impacted consumer demand for our services, as consumers weighed the financial implications of selling or purchasing a home and taking out a mortgage.

In response to these macroeconomic and consumer demand developments, we took action to adjust our operations and manage our business towards longer-term profitability despite these adverse macroeconomic factors.

From April 2022, after completing the acquisition of Bay Equity, through December 2024, through involuntary reductions and attrition, we reduced our total number of employees by 39%. These workforce reductions were intended to align the size of our operations with the level of consumer demand for our services at that time.

In November of 2022, we decided to wind-down our properties segment, which included RedfinNow. This was a strategic decision we made in order to focus our resources on our core business in the face of the rising cost of capital. We completed the wind-down of our properties segment in the second quarter of 2023. Results for the properties segment are now reported in discontinued operations for all periods presented. The following discussion and analysis of our financial condition and results of operations include our continued operations for all periods presented.

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Key Business Metrics

In addition to the measures presented in our consolidated financial statements, we use the following key metrics to evaluate our business, develop financial forecasts, and make strategic decisions.


	Year Ended December 31,
	2024			2023			2022
Monthly average visitors (in thousands)	48,129			49,479			49,654
Real estate services transactions
Brokerage	48,982			47,244			66,554
Partner	12,448			14,676			13,649
Total	61,430			61,920			80,203
Real estate services revenue per transaction
Brokerage	$	12,403		$	12,260		$	11,269
Partner	2,838			2,681			2,718
Aggregate	10,465			9,990			9,814
U.S. market share by units(1)	0.76		%	0.76		%	0.80		%
Revenue from top-10 markets as a percentage of real estate services revenue	56		%	55		%	58		%
Average number of lead agents	1,765			1,776			2,426
Mortgage originations by dollars (in millions)	$	4,556		$	4,268		$	4,317
Mortgage originations by units (in ones)	10,891			10,654			10,625

(1) Prior to the second quarter of 2022, we reported our U.S. market share based on the aggregate home value of our real estate services transactions, relative to the aggregate value of all U.S. home sales, which we computed based on the mean sale price of U.S. homes provided by the National Association of REALTORS® (“NAR”). Beginning in the second quarter of 2022, NAR (1) revised its methodology of computing the mean sale price, (2) restated its previously reported mean sale price beginning from January 2020 (and indicated that previously reported mean sale price prior to January 2020 is not comparable), and (3) discontinued publication of the mean sale price as part of its primary data set. Due to these changes, as of the second quarter of 2022, we report our U.S. market share based on the number of homes sold, rather than the dollar value of homes sold. Our market share by number of homes sold has historically been lower than our market share by dollar value of homes sold. We also stopped reporting the aggregate home value of our real estate services transactions.

Monthly Average Visitors

The number of, and growth in, visitors to our website and mobile application are important leading indicators of our business activity because these channels are the primary ways we meet customers. The number of visitors is influenced by, among other things, market conditions that affect interest in buying or selling homes, the level and success of our marketing programs, seasonality, and how our website appears in search results. We believe we can continue to increase visitors, which helps our growth.

Given the lengthy process to buy or sell a home, a visitor during one month may not convert to a revenue-generating customer until many months later, if at all.

When we refer to "monthly average visitors" for a particular period, we are referring to the average number of unique visitors to our website and our mobile applications for each of the months in that period, as measured by Google Analytics, a product that provides digital marketing intelligence. Google Analytics tracks visitors using cookies, with a unique cookie being assigned to each browser or mobile application on a device. For any given month, Google Analytics counts all of the unique cookies that visited our website and mobile applications during that month. Google Analytics considers each unique cookie as a unique visitor. Due to third-party technological limitations, user software settings, or user behavior, it is possible that Google Analytics may assign a unique cookie to different visits by the same person to our website or mobile application. In such instances, Google Analytics would count different visits by the same person as separate visits by unique visitors. Accordingly, reliance on the number of unique cookies counted by Google Analytics may overstate the actual number of unique persons who visit our website or our mobile applications for a given month.

Our monthly average visitors exclude visitors to Rent.'s websites and mobile applications.

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Real Estate Services Transactions

We record a brokerage real estate services transaction when one of our lead agents represented the homebuyer or home seller in the purchase or sale, respectively, of a home. We record a partner real estate services transaction (i) when one of our partner agents represented the homebuyer or home seller in the purchase or sale, respectively, of a home or (ii) when a Redfin customer sold his or her home to a third-party institutional buyer following our introduction of that customer to the buyer. We include a single transaction twice when our lead agents or our partner agents serve both the homebuyer and the home seller of the transaction. Additionally, when one of our lead agents represented RedfinNow in its sale of a home, we included that transaction as a brokerage real estate services transaction. We completed the wind-down of our RedfinNow business in the second quarter of 2023.

Increasing the number of real estate services transactions is critical to increasing our revenue and, in turn, to achieving profitability. Real estate services transaction volume is influenced by, among other things, the pricing and quality of our services as well as market conditions that affect home sales, such as local inventory levels and mortgage interest rates. Real estate services transaction volume is also affected by seasonality and macroeconomic factors.

Real Estate Services Revenue per Transaction

Real estate services revenue per transaction, together with the number of real estate services transactions, is a factor in evaluating revenue growth. We also use this metric to evaluate pricing changes. Changes in real estate services revenue per transaction can be affected by, among other things, our pricing, the mix of transactions from homebuyers and home sellers, changes in the value of homes in the markets we serve, the geographic mix of our transactions, and the transactions we refer to partner agents and any third-party institutional buyer. We calculate real estate services revenue per transaction by dividing brokerage, partner, or aggregate revenue, as applicable, by the corresponding number of real estate services transactions in any period.

We generally generate more real estate services revenue per transaction from representing homebuyers than home sellers. However, we believe that representing home sellers has unique strategic value, including the marketing power of yard signs and other campaigns, and the market effect of controlling listing inventory.

Prior to July 2022, homebuyers who purchased their home using our brokerage services would receive a commission refund in a substantial majority of our markets. In July 2022, we began a pilot program in certain of those markets to eliminate our commission refund. Since this pilot was successful, we eliminated the standard commission refund we had historically provided in all markets in December 2022. The average refund per transaction for a homebuyer was $1,336 in 2022. The elimination of this commission refund increased our real estate services revenue per transaction in 2023, although this metric is also impacted by the factors discussed above. In September 2023, we began a pilot program in certain markets to provide a refund to homebuyers who sign a buyer agency agreement with us before their second home tour. We expanded this pilot program to more markets in the first quarter of 2024.

Beginning in August 2024, we set our fees for homebuyers based on prevailing competitive dynamics and customer response in the geographical regions where we operate. We further offer a discount to homebuyers who agree to work with our lead agents early in their home buying process. These direct fees are reflected in our real estate revenue per transaction for homebuyers.

From 2023 to 2024, the percentage of brokerage transactions from home sellers was essentially unchanged at approximately 44%.

U.S. Market Share by Units

Increasing our U.S. market share by units is critical to our ability to grow our business and achieve profitability over the long term. We believe there is a significant opportunity to increase our share in the markets we currently serve.

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We calculate our market share by aggregating the number of brokerage and partner real estate services transactions. We then divide that number by two times the aggregate number of U.S. home sales, in order to account for both the sell- and buy-side components of each home sale. We obtain the aggregate number of U.S. home sales from the National Association of REALTORS® ("NAR"). NAR data for the most recent period is preliminary and may subsequently be updated by NAR.

Revenue from Top-10 Markets as a Percentage of Real Estate Services Revenue

Our top-10 markets by real estate services revenue are the metropolitan areas of Boston, Chicago, Denver (including Boulder and Colorado Springs), Los Angeles (including Santa Barbara), Maryland, Northern Virginia, Portland (including Bend), San Diego, San Francisco, and Seattle. This metric is an indicator of the geographic concentration of our real estate services segment. We expect our revenue from top-10 markets to decline as a percentage of our total real estate services revenue over time.

Average Number of Lead Agents

The average number of lead agents, in combination with our other key metrics such as the number of brokerage transactions, is a basis for calculating agent productivity and is one indicator of the potential future growth of our business. We systematically evaluate traffic to our website and mobile application and customer activity to anticipate changes in customer demand, helping determine when and where to hire lead agents.

We calculate the average number of lead agents by taking the average of the number of lead agents at the end of each month included in the period.

Mortgage Originations

Mortgage originations is the volume of mortgage loans originated by our mortgage business, measured by both dollar value of loans and number of loans. This volume is an indicator for the growth of our mortgage business. Mortgage originations is affected by mortgage interest rates, the ability of our mortgage loan officers to close loans, and the number of our homebuyer customers who use our mortgage business for a mortgage loan, among other factors.

Prior to April 1, 2022, our mortgage business consisted solely of Redfin Mortgage, LLC. From April 1, 2022 through June 30, 2022, our mortgage business consisted of both Bay Equity LLC and Redfin Mortgage, LLC. We dissolved Redfin Mortgage, LLC on June 30, 2022, and since that time, our mortgage business has consisted solely of Bay Equity LLC.

Components of Our Results of Operations

Revenue

We generate revenue primarily from commissions and fees charged on each real estate services transaction closed by our lead agents or partner agents, from subscription-based product offerings for our rentals business, and from the origination, sales, and servicing of mortgages.

Real Estate Services Revenue

Brokerage Revenue—Brokerage revenue includes our offer and listing services, where our lead agents represent homebuyers and home sellers. We recognize commission-based brokerage revenue upon closing of a brokerage transaction, less the amount of any commission refunds, closing-cost reductions, or promotional offers that may result in a material right. Brokerage revenue is affected by the number of brokerage transactions we close, the mix of brokerage transactions, home-sale prices, commission rates, and the amount we give to customers.

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Partner Revenue—Partner revenue consists of fees paid to us from partner agents or under other referral agreements, less the amount of any payments we make to homebuyers and home sellers. We recognize these fees as revenue on the closing of a transaction. We earn a fixed percentage of the partner agent's commission based on the terms of our referral agreements. Due to variability in factors outside our control, including final sale prices and actual commission rates, we recognize revenue only upon closing of the underlying real estate transaction when such variability has been resolved. Partner revenue is affected by the number of partner transactions closed, home-sale prices, and commission rates. If the portion of customers we introduce to our own lead agents increases, we expect the portion of revenue closed by partner agents to decrease.

Rentals Revenue

Rentals Revenue—Rentals revenue is primarily composed of subscription-based product offerings for internet listing services, as well as lead management and digital marketing solutions. Rentals revenue is affected by the number of product offerings sold, pricing for each product, customer retention, and the mix of product offerings sold to our customers.

Mortgage Revenue

Mortgage Revenue—Mortgage revenue includes fees from the origination and subsequent sale of loans, loan servicing income, interest income on loans held for sale, origination of IRLCs, and the changes in fair value of our IRLCs, forward sales commitments, loans held for sale, and MSRs. Mortgage revenue is affected by loan volume, loan pricing, and market factors that impact the fair value of our MSRs and loans held for sale.

Title Revenue

Title Revenue—Title revenue includes fees earned from title settlement services. Substantially all fees and revenue from title services are recognized when the service is provided.

Monetization Revenue

Monetization Revenue—Monetization revenue includes advertising and Walk Score data services. Substantially all fees and revenue from monetization services are recognized when the service is provided.

Cost of Revenue and Gross Margin

Cost of revenue consists primarily of personnel costs (including base pay, benefits, and stock-based compensation), transaction bonuses, home-touring and field expenses, listing expenses, customer fulfillment costs related to our rentals segment, office and occupancy expenses, interest expense on our mortgage related warehouse facilities, and depreciation and amortization related to fixed assets and acquired intangible assets.

Gross profit is revenue less cost of revenue. Gross margin is gross profit expressed as a percentage of revenue. Our gross margin has and will continue to be affected by a number of factors, but the most important are the mix of revenue from our segments, real estate services revenue per transaction, agent and support-staff productivity, and personnel costs and transaction bonuses.

Operating Expenses

Technology and Development

Our primary technology and development expenses are building software for our customers, lead agents, and support staff to work together on a transaction, and building a website and mobile application to meet customers looking to move. These expenses primarily include personnel costs (including base pay, bonuses, benefits, and stock-based compensation), data licenses, software and equipment, and infrastructure such as for data centers and hosted services. The expenses also include amortization of acquired intangible assets, capitalized internal-use software and website and mobile application development costs. We expense research and development costs as incurred and record them in technology and development expenses.

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Marketing

Marketing expenses consist primarily of media costs for online and offline advertising, as well as personnel costs (including base pay, benefits, and stock-based compensation).

General and Administrative

General and administrative expenses consist primarily of personnel costs (including base pay, benefits, and stock-based compensation), facilities costs and related expenses for our executive, finance, human resources, and legal organizations, depreciation related to our fixed assets, and fees for outside services. Outside services are principally composed of external legal, audit, and tax services. For our rentals business, personnel costs include employees in the sales department. These employees are responsible for attracting potential rental properties and agreeing to contract terms, but they are not responsible for delivering a service to the rental property.

Restructuring and Reorganization

Restructuring and reorganization costs primarily include severance pay and retention bonuses related to workforce reductions and operational efficiency initiatives. As of December 31, 2024, there were no significant outstanding liabilities associated with these restructuring and reorganization activities.

Interest Income, Interest Expense, Income Tax Benefit (Expense), Gain on Extinguishment of Convertible Senior Notes, and Other Expense, Net

Interest Income

Interest income consists primarily of interest earned on our cash, cash equivalents, and investments.

Interest Expense

Interest expense consists primarily of interest payable and the amortization of debt discounts and issuance costs related to our convertible senior notes and term loan. See Note 14 to our consolidated financial statements for information regarding interest on our convertible senior notes.

Income Tax Benefit (Expense)

Income tax benefit (expense) primarily relates to current state income taxes and deferred federal and state income taxes.

Gain on Extinguishment of Convertible Senior Notes

Gain on extinguishment of convertible senior notes relates to gains recognized on the repurchase of our convertible senior notes.

Other Expense, Net

Other expense, net consists primarily of losses related to fixed asset disposals or write-offs and other assets.

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Results of Operations

The following tables set forth our results of operations for the periods presented and as a percentage of our revenue for those periods.


	Year Ended December 31,
	2024		2023		2022

	(in thousands)
Revenue	$	1,042,979	$	976,672	$	1,099,574
Cost of revenue(1)	678,778		646,853		790,455
Gross profit	364,201		329,819		309,119
Operating expenses:
Technology and development(1)	163,927		183,294		178,924
Marketing(1)	114,481		117,863		155,309
General and administrative(1)	235,364		238,790		243,390
Restructuring and reorganization	5,684		7,927		32,353
Total operating expenses	519,456		547,874		609,976
Loss from continuing operations	(155,255)		(218,055)		(300,857)
Interest income	6,348		10,532		6,639
Interest expense	(27,780)		(9,524)		(8,886)
Income tax benefit (expense)	530		(979)		(116)
Gain on extinguishment of convertible senior notes	12,000		94,019		57,193
Other expense, net	(644)		(2,385)		(3,770)
Net loss from continuing operations	$	(164,801)	$	(126,392)	$	(249,797)

(1) Includes stock-based compensation as follows:


	Year Ended December 31,
	2024		2023		2022

	(in thousands)
Cost of revenue	$	11,180	$	12,914	$	15,137
Technology and development	34,339		33,111		26,365
Marketing	5,027		5,148		3,991
General and administrative	20,613		19,528		17,526
Total	$	71,159	$	70,701	$	63,019

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	Year Ended December 31,
	2024		2023		2022

	(as a percentage of revenue)
Revenue	100.0	%	100.0	%	100.0	%
Cost of revenue(1)	65.1		66.2		71.9
Gross profit	34.9		33.8		28.1
Operating expenses:
Technology and development(1)	15.7		18.8		16.3
Marketing(1)	11.0		12.1		14.1
General and administrative(1)	22.6		24.4		22.1
Restructuring and reorganization	0.5		0.8		2.9
Total operating expenses	49.8		56.1		55.4
Loss from continuing operations	(14.9)		(22.3)		(27.3)
Interest income	0.6		1.1		0.6
Interest expense	(2.7)		(1.0)		(0.8)
Income tax benefit (expense)	0.1		(0.1)		—
Gain on extinguishment of convertible senior notes	1.2		9.6		5.2
Other expense, net	(0.1)		(0.2)		(0.3)
Net loss from continuing operations	(15.8)	%	(12.9)	%	(22.6)	%

(1) Includes stock-based compensation as follows:


	Year Ended December 31,
	2024		2023		2022

	(as a percentage of revenue)
Cost of revenue	1.1	%	1.3	%	1.4	%
Technology and development	3.3		3.4		2.4
Marketing	0.5		0.5		0.4
General and administrative	2.0		2.0		1.6
Total	6.9	%	7.2	%	5.8	%

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Comparison of the Years Ended December 31, 2024 and 2023

Revenue


	Year Ended December 31,						Change
	2024			2023			Dollars		Percentage

	(in thousands, except percentages)
Real estate services
Brokerage	$	607,541		$	579,226		$	28,315	5	%
Partner	35,326			39,351			(4,025)		(10)
Total real estate services	642,867			618,577			24,290		4
Rentals	203,739			184,812			18,927		10
Mortgage	139,829			134,108			5,721		4
Title	37,509			25,095			12,414		49
Monetization	19,035			14,080			4,955		35
Total revenue	$	1,042,979		$	976,672		$	66,307	7
Percentage of revenue
Real estate services
Brokerage	58.3		%	59.3		%
Partner	3.4			4.0
Total real estate services	61.7			63.3
Rentals	19.5			18.9
Mortgage	13.4			13.7
Title	3.6			2.6
Monetization	1.8			1.5
Total revenue	100.0		%	100.0		%

In 2024, revenue increased by $66.3 million, or 7%, as compared with 2023. This increase in revenue was primarily attributable to a $24.3 million increase in real estate services revenue. Brokerage revenue increased by $28.3 million and partner revenue decreased by $4.0 million. Brokerage revenue increased 5% during the period, driven by a 4% increase in brokerage transactions and a 1% increase in brokerage revenue per transaction.

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Cost of Revenue and Gross Margin


	Year Ended December 31,						Change
	2024			2023			Dollars		Percentage

	(in thousands, except percentages)
Cost of revenue
Real estate services	$	487,513		$	462,625		$	24,888	5	%
Rentals	47,724			42,086			5,638		13
Mortgage	115,556			118,178			(2,622)		(2)
Title	27,024			23,335			3,689		16
Monetization	961			629			332		53
Total cost of revenue	$	678,778		$	646,853		$	31,925	5

Gross profit
Real estate services	$	155,354		$	155,952		$	(598)	—	%
Rentals	156,015			142,726			13,289		9
Mortgage	24,273			15,930			8,343		52
Title	10,485			1,760			8,725		496
Monetization	18,074			13,451			4,623		34
Total gross profit	$	364,201		$	329,819		$	34,382	10

Gross margin (percentage of revenue)
Real estate services	24.2		%	25.2		%
Rentals	76.6			77.2
Mortgage	17.4			11.9
Title	28.0			7.0
Monetization	95.0			95.5
Total gross margin	34.9			33.8

In 2024, total cost of revenue increased by $31.9 million, or 5%, as compared with 2023. This increase in cost of revenue was primarily attributable to a $27.1 million increase in personnel costs, transaction bonuses, and home-touring and field expenses.

Total gross margin increased 110 basis points, driven primarily by increases in mortgage and title gross margins, and the relative growth of our rentals and monetization businesses. This increase in total gross margin was partially offset by decreases in real estate services, rentals, and monetization gross margins.

In 2024, real estate services gross margin decreased 100 basis points. This was primarily attributable to a 380 basis point increase in personnel costs and transaction bonuses, partially offset by a 270 basis point decrease in home-touring and field expenses, each as a percentage of revenue, as we have eliminated compensation for home-touring and field expenses and replaced it with transaction bonuses for employee agents. We completed this transition to all-variable agent compensation in the quarter ended December 31, 2024.

In 2024, rentals gross margin decreased by 60 basis points. This was primarily attributable to a 120 basis point increase in marketing expense as a percentage of revenue. This was partially offset by a 20 basis point reduction in personnel costs as a percentage of revenue.

In 2024, mortgage gross margin increased by 550 basis points. This was primarily attributable to a 260 basis point decrease in personnel costs and transaction bonuses, a 160 basis point decrease in office and occupancy expenses, and a 130 basis point decrease in production costs, each as a percentage of revenue.

In 2024, title gross margin increased by 2,100 basis points. This was primarily attributable to a 1,280 decrease in personnel costs and transaction bonuses, and a 340 basis point decrease in production costs, each as a percentage of revenue.

In 2024, monetization gross margin decreased by 50 basis points.

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Operating Expenses


	Year Ended December 31,						Change
	2024			2023			Dollars		Percentage

	(in thousands, except percentages)
Technology and development	$	163,927		$	183,294		$	(19,367)	(11)	%
Marketing	114,481			117,863			(3,382)		(3)
General and administrative	235,364			238,790			(3,426)		(1)
Restructuring and reorganization	5,684			7,927			(2,243)		(28)
Total operating expenses	$	519,456		$	547,874		$	(28,418)	(5)
Percentage of revenue
Technology and development	15.7		%	18.8		%
Marketing	11.0			12.1
General and administrative	22.6			24.4
Restructuring and reorganization	0.5			0.8
Total operating expenses	49.8		%	56.1		%

In 2024, technology and development expenses decreased by $19.4 million, or 11%, as compared with 2023. The decrease was primarily attributable to a $16.4 million decrease in amortization expense, as the intangible technology assets acquired with Rent. completed their amortization.

In 2024, marketing expenses decreased by $3.4 million, or 3%, as compared with 2023. The decrease was primarily attributable to a $1.7 million decrease in outside services, and a $0.8 million decrease in marketing media costs.

In 2024, general and administrative expenses decreased by $3.4 million, or 1%, as compared with 2023. This was primarily attributable to an $8.0 million decrease in company event costs including our annual, in-person company event, which we did not conduct in 2024, a $4.3 million decrease in office and occupancy expenses, and a $2.3 million decrease in personnel costs. This was partially offset by a $9.4 million increase in legal settlements. See Note 7 to our consolidated financial statements for information on these legal matters.

In 2024, restructuring and reorganization expenses decreased by $2.2 million, or 28%, as compared with the same period in 2023.

Interest Income, Interest Expense, Income Tax Benefit (Expense), Gain on Extinguishment of Convertible Senior Notes, and Other Expense, Net


	Year Ended December 31,						Change
	2024			2023			Dollars		Percentage

	(in thousands, except percentages)
Interest income	$	6,348		$	10,532		$	(4,184)	(40)	%
Interest expense	(27,780)			(9,524)			(18,256)		192
Income tax benefit (expense)	530			(979)			1,509		(154)
Gain on extinguishment of convertible senior notes	12,000			94,019			(82,019)		(87)
Other expense, net	(644)			(2,385)			1,741		(73)
Interest income, interest expense, income tax benefit (expense), gain on extinguishment of convertible senior notes, and other expense, net	$	(9,546)		$	91,663		$	(101,209)	(110)
Percentage of revenue
Interest income	0.6		%	1.1		%
Interest expense	(2.7)			(1.0)
Income tax benefit (expense)	0.1			(0.1)
Gain on extinguishment of convertible senior notes	1.2			9.6
Other expense, net	(0.1)			(0.2)
Interest income, interest expense, income tax benefit (expense), gain on extinguishment of convertible senior notes, and other expense, net	(0.9)		%	9.4		%

In 2024, interest income, interest expense, income tax benefit (expense), gain on extinguishment of convertible senior notes, and other expense, net decreased by $101.2 million, as compared with 2023.

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Interest income decreased by $4.2 million primarily due to lower interest rates on our cash, cash equivalents, and investments compared with 2023, and a lower cash balance as compared to 2023.

Interest expense increased by $18.3 million primarily due to interest on our term loan, which we did not have in the full period of 2023. See Note 14 to our consolidated financial statements for further information on our debt.

Gain on extinguishment of convertible senior notes decreased by $82.0 million, due to our paying down a smaller portion of our 2025 and 2027 notes at a discount, where there was $94.0 million of such activity in 2023. See Note 14 to our consolidated financial statements for further information on these transactions.

Comparison of the Years Ended December 31, 2023 and 2022

Revenue


	Year Ended December 31,						Change
	2023			2022			Dollars		Percentage

	(in thousands, except percentages)
Real estate services
Brokerage	$	579,226		$	749,985		$	(170,759)	(23)	%
Partner	39,351			37,091			2,260		6
Total real estate services	618,577			787,076			(168,499)		(21)
Rentals	184,812			155,910			28,902		19
Mortgage	134,108			132,904			1,204		1
Title	25,095			17,425			7,670		44
Monetization	14,080			6,259			7,821		125
Total revenue	$	976,672		$	1,099,574		$	(122,902)	(11)
Percentage of revenue
Real estate services
Brokerage	59.3		%	68.2		%
Partner	4.0			3.4
Total real estate services	63.3			71.6
Rentals	18.9			14.2
Mortgage	13.7			12.1
Title	2.6			1.6
Monetization	1.5			0.5
Total revenue	100.0		%	100.0		%

In 2023, revenue decreased by $122.9 million, or 11%, as compared with 2022. This decrease was partially offset by $134.1 million resulting from our acquisition of Bay Equity, and there were $130.2 million of such revenues in 2022. Excluding these revenues from Bay Equity, this decrease in revenue was primarily attributable to a $168.5 million decrease in real estate services revenue. Brokerage revenue decreased by $170.8 million and partner revenue increased by $2.3 million. Brokerage revenue decreased 23% during the period, driven by a 29% decrease in brokerage transactions and partially offset by a 9% increase in brokerage revenue per transaction.

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Cost of Revenue and Gross Margin


	Year Ended December 31,						Change
	2023			2022			Dollars		Percentage

	(in thousands, except percentages)
Cost of revenue
Real estate services	$	462,625		$	608,027		$	(145,402)	(24)	%
Rentals	42,086			33,416			8,670		26
Mortgage	118,178			126,552			(8,374)		(7)
Title	23,335			21,694			1,641		8
Monetization	629			766			(137)		(18)
Total cost of revenue	$	646,853		$	790,455		$	(143,602)	(18)

Gross profit
Real estate services	$	155,952		$	179,049		$	(23,097)	(13)	%
Rentals	142,726			122,494			20,232		17
Mortgage	15,930			6,352			9,578		151
Title	1,760			(4,269)			6,029		(141)
Monetization	13,451			5,493			7,958		145
Total gross profit	$	329,819		$	309,119		$	20,700	7

Gross margin (percentage of revenue)
Real estate services	25.2		%	22.7		%
Rentals	77.2			78.6
Mortgage	11.9			4.8
Title	7.0			(24.5)
Monetization	95.5			87.8
Total gross margin	33.8			28.1

In 2023, total cost of revenue increased by $143.6 million, or 18%, as compared with 2022. Included in the decrease was $118.0 million resulting from our acquisition of Bay Equity, and there were $118.1 million of expenses in 2022. Excluding these expenses from Bay Equity, this decrease in cost of revenue was primarily attributable to a $128.1 million decrease in personnel costs and transaction bonuses, due to decreased headcount and decreased brokerage transactions, respectively.

Total gross margin increased 570 basis points as compared with 2022, driven primarily by increases in real estate services, mortgage, and other gross margins, and the relative growth of our rentals business compared to our other businesses. This was partially offset by decreases in rentals gross margin.

In 2023, real estate services gross margin increased 250 basis points as compared with 2022. This was primarily attributable to a 410 basis point decrease in personnel costs and transaction bonuses, and a 50 basis point decrease in home-touring and field expenses, each as a percentage of revenue. This was partially offset by a 120 basis point increase in home repair costs, a 40 basis point increase in listing expenses, and a 40 basis point increase in costs from our annual, in-person company event, which we did not conduct in the same period in 2022, each as a percentage of revenue.

In 2023, rentals gross margin decreased by 140 basis points. This was primarily attributable to a 420 basis point increase in marketing expense as a percentage of revenue and due to expanded services. This was partially offset by a 150 basis point reduction in personnel costs as a percentage of revenue.

In 2023, mortgage gross margin increased by 710 basis points. This was primarily attributable to a 910 basis point decrease in personnel costs and transaction bonuses as a percentage of revenue. This was partially offset by a 310 basis point increase in production costs as a percentage of revenue.

In 2023, title gross margin increased by 3,150 basis points. This was primarily attributable to a 2,270 basis point decrease in personnel costs and transaction bonuses, and a 620 basis point decrease in production costs, each as a percentage of revenue.

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In 2023, monetization gross margin increased by 770 basis points. This was primarily attributable to an increase in revenue.

Operating Expenses


	Year Ended December 31,						Change
	2023			2022			Dollars		Percentage

	(in thousands, except percentages)
Technology and development	$	183,294		$	178,924		$	4,370	2	%
Marketing	117,863			155,309			(37,446)		(24)
General and administrative	238,790			243,390			(4,600)		(2)
Restructuring and reorganization	7,927			32,353			(24,426)		(75)
Total operating expenses	$	547,874		$	609,976		$	(62,102)	(10)
Percentage of revenue
Technology and development	18.8		%	16.3		%
Marketing	12.1			14.1
General and administrative	24.4			22.1
Restructuring and reorganization	0.8			2.9
Total operating expenses	56.1		%	55.4		%

In 2023, technology and development expenses increased by $4.4 million, or 2%, as compared with 2022. Included in the increase was $1.7 million resulting from our acquisition of Bay Equity, and there were $1.8 million of expenses in 2022. Excluding these expenses Bay Equity, the increase was primarily attributable to a $3.9 million increase in personnel costs.

In 2023, marketing expenses decreased by $37.4 million, or 24%, as compared with 2022. Included in the decrease was $4.0 million resulting from our acquisition of Bay Equity, and there were $4.7 million of expenses in 2022. Excluding these expenses from Bay Equity, the decrease was primarily attributable to a $37.3 million decrease in marketing media costs as we reduced advertising.

In 2023, general and administrative expenses decreased by $4.6 million, or 2%, as compared with 2022. Included in the decrease was $24.7 million resulting from our acquisition of Bay Equity, and there were $22.8 million of expenses in 2022. Excluding these expenses from Bay Equity, the decrease was primarily attributable to a $6.9 million decrease in personnel costs, a $2.4 million decrease in acquisition-related expenses, and a $2.1 million decrease in legal expenses. This was partially offset by $5.9 million in costs associated with our annual, in-person company event, which we did not conduct in the same period in 2022, and a $0.7 million increase in office and occupancy expenses as we terminated a lease.

In 2023, restructuring and reorganization expenses decreased by $24.4 million or 75%, as compared with the same period in 2022. This decrease is primarily attributable to a lower volume of restructuring activities as compared with 2022, when we decided to wind-down our properties segment.

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Interest Income, Interest Expense, Income Tax Expense, Gain on Extinguishment of Convertible Senior Notes, and Other Expense, Net


	Year Ended December 31,						Change
	2023			2022			Dollars		Percentage

	(in thousands, except percentages)
Interest income	$	10,532		$	6,639		$	3,893	59	%
Interest expense	(9,524)			(8,886)			(638)		7
Income tax expense	(979)			(116)			(863)		744
Gain on extinguishment of convertible senior notes	94,019			57193			36,826		64
Other expense, net	(2,385)			(3,770)			1,385		(37)
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net	$	91,663		$	51,060		$	40,603	80
Percentage of revenue
Interest income	1.1		%	0.6		%
Interest expense	(1.0)			(0.8)
Income tax expense	(0.1)			—
Gain on extinguishment of convertible senior notes	9.6			5.2
Other expense, net	(0.2)			(0.3)
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net	9.4		%	4.7		%

In 2023, interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net increased by $40.6 million as compared to the same period in 2022.

Interest income increased by $3.9 million primarily due to higher interest rates on our cash, cash equivalents, and investments compared with 2022.

Interest expense increased by $0.6 million primarily due to our term loan due in 2028. See Note 14 to our consolidated financial statements for further information on our debt.

Income tax expense decreased by $0.9 million primarily due to state income tax expenses, and items associated with our acquisitions of Rent. and Bay Equity. See Note 13 to our consolidated financial statements.

Gain on extinguishment of convertible senior notes increased by $36.8 million, due to our paying down a portion of our 2025 and 2027 notes at a discount, where there was $57.2 million of such activity in 2022. See Note 14 to our consolidated financial statements for further information on these transactions.

Other expense, net decreased by $1.4 million primarily due to due to the sale of one of our equity investments at a loss in 2022, and we had no such transaction in 2023.

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Quarterly Results of Operations and Key Business Metrics

The following tables set forth our unaudited quarterly statements of operations data for the most recent eight quarters, as well as the percentage that each line item represents of our revenue for each quarter presented. The information for each quarter has been prepared on a basis consistent with our consolidated financial statements and reflect, in the opinion of management, all adjustments of a normal, recurring nature that are necessary for a fair presentation of the financial information contained in those statements. The following quarterly financial data should be read in conjunction with our consolidated financial statements.

Quarterly Results


	Three Months Ended
	Dec. 31, 2024		Sep. 30, 2024		Jun. 30, 2024		Mar. 31, 2024		Dec. 31, 2023		Sep. 30, 2023		Jun. 30, 2023		Mar. 31, 2023
Revenue	$	244,282	$	278,015	$	295,203	$	225,479	$	218,077	$	268,956	$	275,556	$	214,083
Cost of revenue(1)	162,342		176,152		185,617		154,667		144,926		170,616		175,366		155,945
Gross profit	81,940		101,863		109,586		70,812		73,151		98,340		100,190		58,138
Operating expenses:
Technology and development(1)	34,951		40,332		42,215		46,429		44,098		44,392		47,141		47,663
Marketing(1)	22,157		27,186		40,260		24,878		20,332		24,095		33,033		40,403
General and administrative(1)	53,998		58,788		54,705		67,873		52,206		55,380		61,765		69,439
Restructuring and reorganization	952		2,509		1,334		889		768		—		6,106		1,053
Total	112,058		128,815		138,514		140,069		117,404		123,867		148,045		158,558
Loss from continuing operations	(30,118)		(26,952)		(28,928)		(69,257)		(44,253)		(25,527)		(47,855)		(100,420)
Interest income	1,216		1,839		1,461		1,832		2,362		2,060		2,704		3,406
Interest expense	(8,283)		(8,537)		(6,086)		(4,874)		(4,233)		(1,603)		(1,766)		(1,922)
Income tax benefit (expense)	905		12		(559)		172		(97)		(239)		(233)		(410)
Gain on extinguishment of convertible senior notes	—		—		6,314		5,686		25,171		6,495		20,083		42,270
Other expense, net	(85)		(144)		(82)		(333)		(1,848)		(158)		(145)		(234)
Net loss from continuing operations	$	(36,365)	$	(33,782)	$	(27,880)	$	(66,774)	$	(22,898)	$	(18,972)	$	(27,212)	$	(57,310)
Net loss from continuing operations attributable to common stock	$	(36,732)	$	(34,064)	$	(28,071)	$	(67,007)	$	(23,114)	$	(19,307)	$	(27,509)	$	(57,536)
Net loss from continuing operations per share—basic and diluted	$	(0.29)	$	(0.28)	$	(0.23)	$	(0.57)	$	(0.20)	$	(0.17)	$	(0.25)	$	(0.52)

(1) Includes stock-based compensation as follows:


	Three Months Ended
	Dec. 31, 2024		Sep. 30, 2024		Jun. 30, 2024		Mar. 31, 2024		Dec. 31, 2023		Sep. 30, 2023		Jun. 30, 2023		Mar. 31, 2023
Cost of revenue	$	2,577	$	2,819	$	3,045	$	2,739	$	2,741	$	3,037	$	3,001	$	4,135
Technology and development	8,247		9,135		8,718		8,239		8,352		8,391		8,241		8,127
Marketing	1,116		1,131		1,349		1,431		1,312		1,337		1,254		1,245
General and administrative	5,277		5,217		5,119		5,000		3,148		6,035		5,025		5,320
Total	$	17,217	$	18,302	$	18,231	$	17,409	$	15,553	$	18,800	$	17,521	$	18,827

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	Three Months Ended
	Dec. 31, 2024		Sep. 30, 2024		Jun. 30, 2024		Mar. 31, 2024		Dec. 31, 2023		Sep. 30, 2023		Jun. 30, 2023		Mar. 31, 2023

	(as a percentage of revenue)
Revenue	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%	100.0	%
Cost of revenue(1)	66.5		63.4		62.9		68.6		66.5		63.4		63.6		72.8
Gross profit	33.5		36.6		37.1		31.4		33.5		36.6		36.4		27.2
Operating expenses
Technology and development(1)	14.3		14.5		14.3		20.6		20.2		16.5		17.1		22.3
Marketing(1)	9.1		9.8		13.6		11.0		9.3		9.0		12.0		18.9
General and administrative(1)	22.1		21.1		18.5		30.1		23.9		20.6		22.4		32.4
Restructuring and reorganization	0.4		0.9		0.5		0.4		0.4		—		2.2		0.5
Total	45.9		46.3		46.9		62.0		53.8		46.1		53.7		74.1
Loss from continuing operations	(12.4)		(9.7)		(9.8)		(30.7)		(20.3)		(9.5)		(17.3)		(46.9)
Interest income	0.5		0.7		0.5		0.8		1.1		0.8		1.0		1.6
Interest expense	(3.4)		(3.1)		(2.1)		(2.2)		(1.9)		(0.6)		(0.6)		(0.9)
Income tax benefit (expense)	0.4		—		(0.2)		0.1		—		(0.1)		(0.1)		(0.2)
Gain on extinguishment of convertible senior notes	—		—		2.1		2.5		11.5		2.4		7.3		19.7
Other expense, net	—		(0.1)		—		(0.1)		(0.8)		(0.1)		(0.1)		(0.1)
Net loss from continuing operations	(14.9)	%	(12.2)	%	(9.5)	%	(29.6)	%	(10.4)	%	(7.1)	%	(9.8)	%	(26.8)	%

(1) Includes stock-based compensation as follows:


	Three Months Ended
	Dec. 31, 2024		Sep. 30, 2024		Jun. 30, 2024		Mar. 31, 2024		Dec. 31, 2023		Sep. 30, 2023		Jun. 30, 2023		Mar. 31, 2023

	(as a percentage of revenue)
Cost of revenue	1.1	%	1.0	%	1.0	%	1.2	%	1.3	%	1.1	%	1.1	%	1.9	%
Technology and development	3.4		3.3		3.0		3.7		3.8		3.1		3.0		3.8
Marketing	0.5		0.4		0.5		0.6		0.6		0.5		0.5		0.6
General and administrative	2.1		1.9		1.7		2.2		1.3		2.3		1.8		2.5
Total	7.1	%	6.6	%	6.2	%	7.7	%	7.0	%	7.0	%	6.4	%	8.8	%

Our revenue and cost of revenue have typically followed the seasonal pattern of the residential real estate industry. As such, revenue and cost of revenue increase sequentially from the first quarter to the second and third quarters. Fourth quarter revenue typically declines sequentially from the third quarter.

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Quarterly Key Business Metrics


	Dec. 31, 2024			Sep. 30, 2024			Jun. 30, 2024			Mar. 31, 2024			Dec. 31, 2023			Sep. 30, 2023			Jun. 30, 2023			Mar. 31, 2023
Monthly average visitors (in thousands)	42,680			49,413			51,619			48,803			43,861			51,309			52,308			50,440
Real estate services transactions
Brokerage	11,441			13,324			14,178			10,039			10,152			13,075			13,716			10,301
Partner	2,922			3,440			3,395			2,691			3,186			4,351			3,952			3,187
Total	14,363			16,764			17,573			12,730			13,338			17,426			17,668			13,488
Real estate services revenue per transaction
Brokerage	$	12,249		$	12,363		$	12,545		$	12,433		$	12,248		$	12,704		$	12,376		$	11,556
Partner	3,027			3,025			2,859			2,367			2,684			2,677			2,756			2,592
Aggregate	10,373			10,447			10,674			10,305			9,963			10,200			10,224			9,438
U.S. market share by units(1)	0.72		%	0.76		%	0.77		%	0.77		%	0.72		%	0.78		%	0.75		%	0.79		%
Revenue from top-10 Redfin markets as a percentage of real estate services revenue	56		%	56		%	56		%	55		%	55		%	56		%	55		%	53		%
Average number of lead agents	1,927			1,757			1,719			1,658			1,692			1,744			1,792			1,876
Mortgage originations by dollars (in millions)	$	1,035		$	1,214		$	1,338		$	969		$	885		$	1,110		$	1,282		$	991
Mortgage originations by units (in ones)	2,434			2,900			3,192			2,365			2,293			2,786			3,131			2,444

Similar to our revenue, monthly average visitors to our website and mobile application has typically followed the seasonal pattern of the residential real estate industry.

Segment Financial Information

The tables below present, for each of our reportable and other segments, financial information on a GAAP basis and adjusted EBITDA, which is a non-GAAP financial measure, for the years ended December 31, 2024, 2023, and 2022.

See Note 3 to our consolidated financial statements for more information regarding our GAAP segment reporting.

To supplement our consolidated financial statements that are prepared and presented in accordance with GAAP, we also compute and present adjusted EBITDA, which is a non-GAAP financial measure. We believe adjusted EBITDA is useful for investors because it enhances period-to-period comparability of our financial statements on a consistent basis and provides investors with useful insight into the underlying trends of the business. The presentation of this financial measure is not intended to be considered in isolation or as a substitute of, or superior to, our financial information prepared and presented in accordance with GAAP. Our calculation of adjusted EBITDA may be different from adjusted EBITDA or similar non-GAAP financial measures used by other companies, limiting its usefulness for comparison purposes.

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Effective December 31, 2024, we determined that our monetization operating segment, previously included within our other segment, meets the quantitative thresholds for separate reporting under ASC 280. This determination was based on monetization’s segment profit exceeding 10% of the combined reported segment profit. Accordingly, monetization is now reported as a separate reportable segment. We have recast our segment information for all prior periods to conform to the current segment structure. This change in segment reporting has no impact on our historical consolidated balance sheets, results of operations, or cash flows. Segment financial information, including a reconciliation of adjusted EBITDA to net (loss) income from continuing operations, for the years ended December 31, 2024, 2023, and 2022, as recast, is presented below:


	Year Ended December 31, 2024
	Real estate services		Rentals		Mortgage		Title		Monetization		Corporate overhead		Total
Revenue	$	642,867	$	203,739	$	139,829	$	37,509	$	19,035	$	—	$	1,042,979
Cost of revenue	487,513		47,724		115,556		27,024		961		—		678,778
Gross profit	155,354		156,015		24,273		10,485		18,074		—		364,201
Operating expenses
Technology and development	105,268		48,015		2,727		448		3,107		4,362		163,927
Marketing	57,961		53,490		2,988		37		4		1		114,481
General and administrative	74,794		88,447		25,428		3,215		1,520		41,960		235,364
Restructuring and reorganization	—		—		—		—		—		5,684		5,684
Total operating expenses	238,023		189,952		31,143		3,700		4,631		52,007		519,456
(Loss) income from continuing operations	(82,669)		(33,937)		(6,870)		6,785		13,443		(52,007)		(155,255)
Interest income, interest expense, income tax (expense) benefit, gain on extinguishment of convertible senior notes, and other expense, net	(25)		197		(2,968)		690		283		(7,723)		(9,546)
Net (loss) income from continuing operations	$	(82,694)	$	(33,740)	$	(9,838)	$	7,475	$	13,726	$	(59,730)	$	(164,801)


	Year ended December 31, 2024
	Real estate services		Rentals		Mortgage		Title		Monetization		Corporate overhead		Total
Net (loss) income from continuing operations	$	(82,694)	$	(33,740)	$	(9,838)	$	7,475	$	13,726	$	(59,730)	$	(164,801)
Interest income(1)	(67)		(365)		(11,615)		(690)		(283)		(4,944)		(17,964)
Interest expense(2)	—		—		14,208		—		—		24,798		39,006
Income tax expense (benefit)	—		109		—		—		—		(639)		(530)
Depreciation and amortization	12,445		25,038		3,660		109		673		843		42,768
Stock-based compensation(3)	44,423		13,443		1,038		1,119		1,157		9,979		71,159

Restructuring and reorganization(4)	—		—		—		—		—		5,684		5,684

Gain on extinguishment of convertible senior notes	—		—		—		—		—		(12,000)		(12,000)
Legal contingencies(5)	—		—		—		—		—		10,154		10,154
Adjusted EBITDA	$	(25,893)	$	4,485	$	(2,547)	$	8,013	$	15,273	$	(25,855)	$	(26,524)

(1) Interest income includes $11.6 million of interest income related to originated mortgage loans for the year ended December 31, 2024.

(2) Interest expense includes $11.2 million of interest expense related to our warehouse credit facilities for the year ended December 31, 2024.

(3) Stock-based compensation consists of expenses related to stock options, restricted stock units, and our employee stock purchase program. See Note 11 to our consolidated financial statements for more information.

(4) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention due to the restructuring and reorganization activities.

(5) Legal contingencies includes expenses related to material contingent liabilities resulting from litigation or other legal proceedings.

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	Year Ended December 31, 2023
	Real estate services		Rentals		Mortgage		Title		Monetization		Corporate overhead		Total
Revenue(1)	$	618,577	$	184,812	$	134,108	$	25,095	$	14,080	$	—	$	976,672
Cost of revenue	462,625		42,086		118,178		23,335		629		—		646,853
Gross profit	155,952		142,726		15,930		1,760		13,451		—		329,819
Operating expenses
Technology and development	108,201		63,934		2,871		510		3,994		3,784		183,294
Marketing	59,746		53,952		4,064		54		6		41		117,863
General and administrative	76,851		94,252		25,012		2,776		1,241		38,658		238,790
Restructuring and reorganization	—		503		—		—		—		7,424		7,927
Total operating expenses	244,798		212,641		31,947		3,340		5,241		49,907		547,874
(Loss) income from continuing operations	(88,846)		(69,915)		(16,017)		(1,580)		8,210		(49,907)		(218,055)
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net	59		215		(392)		348		364		91,069		91,663
Net (loss) income from continuing operations	$	(88,787)	$	(69,700)	$	(16,409)	$	(1,232)	$	8,574	$	41,162	$	(126,392)

(1) Included in revenue is $1.2 million from providing services to our discontinued properties segment.


	Year ended December 31, 2023
	Real estate services		Rentals		Mortgage		Title		Monetization		Corporate overhead		Total
Net (loss) income from continuing operations	$	(88,787)	$	(69,700)	$	(16,409)	$	(1,232)	$	8,574	$	41,162	$	(126,392)
Interest income(1)	(59)		(338)		(11,238)		(348)		(364)		(9,407)		(21,754)
Interest expense(2)	—		—		12,055		—		—		9,417		21,472
Income tax expense	—		123		289		—		—		567		979
Depreciation and amortization	16,020		39,876		3,864		137		865		2,000		62,762
Stock-based compensation(3)	44,002		14,653		1,466		885		1,361		8,334		70,701
Acquisition-related costs(4)	—		—		—		—		—		8		8
Restructuring and reorganization(5)	—		503		—		—		—		7,424		7,927
Impairment(6)	—		—		—		—		—		1,948		1,948
Gain on extinguishment of convertible senior notes	—		—		—		—		—		(94,019)		(94,019)
Adjusted EBITDA	$	(28,824)	$	(14,883)	$	(9,973)	$	(558)	$	10,436	$	(32,566)	$	(76,368)

(1) Interest income includes $11.2 million of interest income related to originated mortgage loans for the year ended December 31, 2023.

(2) Interest expense includes $11.9 million of interest expense related to our warehouse credit facilities for the year ended December 31, 2023.

(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies.

(5) Restructuring and reorganization expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention due to the restructuring and reorganization activities.

(6) Impairment consists of impairment losses due to subleasing two of our operating leases.

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	Year Ended December 31, 2022
	Real estate services		Rentals		Mortgage		Title		Monetization		Corporate overhead		Total
Revenue(1)	$	787,076	$	155,910	$	132,904	$	17,425	$	6,259	$	—	$	1,099,574
Cost of revenue	608,027		33,416		126,552		21,694		766		—		790,455
Gross profit	179,049		122,494		6,352		(4,269)		5,493		—		309,119
Operating expenses
Technology and development	105,196		59,899		6,034		1,728		1,863		4,204		178,924
Marketing	98,673		51,064		4,889		194		5		484		155,309
General and administrative	88,171		92,728		25,680		2,751		556		33,504		243,390
Restructuring and reorganization	—		—		—		—		—		32,353		32,353
Total operating expenses	292,040		203,691		36,603		4,673		2,424		70,545		609,976
Loss from continuing operations	(112,991)		(81,197)		(30,251)		(8,942)		3,069		(70,545)		(300,857)
Interest income, interest expense, income tax expense (benefit) and other income, net	(123)		1,389		(114)		47		93		49,768		51,060
Net loss from continuing operations	$	(113,114)	$	(79,808)	$	(30,365)	$	(8,895)	$	3,162	$	(20,777)	$	(249,797)

(1) Included in revenue is $17.8 million from providing services to our discontinued properties segment.


	Year ended December 31, 2022
	Real estate services		Rentals		Mortgage		Title		Monetization		Corporate overhead		Total
Net loss from continuing operations	$	(113,114)	$	(79,808)	$	(30,365)	$	(8,895)	$	3,162	$	(20,777)	$	(249,797)
Interest income(1)	—		(24)		(10,499)		(48)		(95)		(6,447)		(17,113)
Interest expense(2)	—		—		8,580		—		—		8,778		17,358
Income tax (benefit) expense	—		(1,077)		—		—		—		1,193		116
Depreciation and amortization	17,526		38,683		3,438		339		750		1,836		62,572
Stock-based compensation(3)	36,652		11,319		4,132		981		515		9,420		63,019
Acquisition-related costs(4)	—		—		—		—		—		2,437		2,437
Restructuring and reorganization(5)	—		—		—		—		—		32,353		32,353
Impairment(6)	—		—		—		—		—		1,136		1,136
Gain on extinguishment of convertible senior notes	—		—		—		—		—		(57,193)		(57,193)
Adjusted EBITDA	$	(58,936)	$	(30,907)	$	(24,714)	$	(7,623)	$	4,332	$	(27,264)	$	(145,112)

(1) Interest income includes $10.5 million of interest income related to originated mortgage loans for the year ended December 31, 2022.

(2) Interest expense includes $8.5 million of interest expense related to our warehouse credit facilities for the year ended December 31, 2022.

(4) Acquisition-related costs consist of fees for external advisory, legal, and other professional services incurred in connection with our acquisition of other companies.

(6) Impairment consists of impairment losses due to subleasing one of our operating leases.

Liquidity and Capital Resources

As of December 31, 2024, we had cash and cash equivalents of $124.7 million.

As of December 31, 2024, we had $576.9 million aggregate principal amount of convertible senior notes outstanding across two issuances maturing between October 15, 2025 and April 1, 2027. See Note 14 to our consolidated financial statements for our obligations to pay semi-annual interest and to repay any outstanding amounts at the notes' maturity. During the year ended December 31, 2024, we repurchased and retired $119.7 million of our 2025 convertible senior notes pursuant to the repurchase program authorized by our board of directors on October 19, 2023, using $107.0 million in cash. As of December 31, 2024, we have repurchased a total of $582.5 million of our 2025 convertible senior notes, using $432.4 million in cash. As of December 31, 2024, we have $17.6 million remaining under the repurchase program for future repurchases.

In addition, as of December 31, 2024, we had $247.5 million principal amount of our term loan, maturing on October 20, 2028.

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On November 30, 2024, all shares of our convertible preferred stock were redeemed in cash. We paid the full issue price of $40.0 million plus a final cash payment of $0.4 million in accrued dividends.

Our mortgage business has significant cash requirements due to the period of time between its origination of a mortgage loan and the sale of that loan. We have relied on warehouse credit facilities with different lenders to fund substantially the entire portion of the mortgage loans that our mortgage business originates. Once our mortgage business sells a loan in the secondary mortgage market, we use the proceeds to reduce the outstanding balance under the related facility. See Note 14 to our consolidated financial statements for more information regarding our warehouse credit facilities.

We believe that our existing cash and cash equivalents, together with cash we expect to generate from future operations, including from our rentals partnership with Zillow (see Note 15), and borrowings from our mortgage warehouse credit facilities, will provide sufficient liquidity to meet our operational needs and our growth for at least the next twelve months, and fulfill our payment obligations with respect to our convertible senior notes and term loan. However, our liquidity assumptions may change or prove to be incorrect, and our future capital requirements may vary materially from those currently planned and depend on many factors. We could exhaust our available financial resources sooner than we currently expect. As a result, we may seek new sources of credit financing or elect to raise additional funds through equity, equity-linked, or debt financing arrangements. We cannot assure you that any additional financing will be available to us on acceptable terms or at all.

Our title and settlement business holds cash in escrow that we do not record in our consolidated balance sheets. See Note 7 to our consolidated financial statements for more information regarding these amounts.

Cash Flows

The following table summarizes our cash flows for the periods indicated:


	Year Ended December 31,
	2024		2023		2022

	(in thousands)
Net cash (used in) provided by operating activities	$	(32,307)	$	56,758	$	40,491
Net cash provided by (used in) investing activities	34,411		97,482		(184,338)
Net cash used in financing activities	(28,108)		(245,415)		(332,094)

Net Cash (Used In) Provided By Operating Activities

Our operating cash flows result primarily from cash generated by commissions paid to us from our real estate services business and sales of homes from our discontinued properties business. Our primary uses of cash from operating activities include payments for personnel-related costs, including employee benefits and bonus programs, marketing and advertising activities, purchases of homes for our properties business, office and occupancy costs, and outside services costs. Additionally, our mortgage business generates a significant amount operating cash flow activity from the origination and sale of loans held for sale.

Net cash used in operating activities was $32.3 million for the year ended December 31, 2024, primarily attributable to our net loss of $164.8 million. This was partially offset by changes in assets and liabilities of $15.9 million and $116.6 million of non-cash items related to stock-based compensation, depreciation and amortization, changes in the fair value of mortgage servicing rights, gain on extinguishment of convertible senior notes, amortization of debt discounts and issuances costs, lease expense related to right-of-use assets, and other non-cash items. The primary source of cash related to changes in our assets and liabilities was a $5.7 million increase in proceeds from sale of loans originated as held for sale. The primary use of cash related to changes in our assets and liabilities was a $15.7 million decrease in lease liabilities.

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Net cash provided by operating activities was $56.8 million for the year ended December 31, 2023, primarily attributable to changes in assets and liabilities of $126.1 million and $60.7 million of non-cash items related to stock-based compensation, depreciation and amortization, changes in the fair value of mortgage servicing rights, gain on extinguishment of convertible senior notes, amortization of debt discounts and issuances costs, lease expense related to right-of-use assets, and other non-cash items. This was offset by a net loss of $130.0 million. The primary source of cash related to changes in our assets and liabilities was a $114.2 million decrease in inventory related to our properties business. The primary use of cash related to changes in our assets and liabilities was a $20.4 million decrease in accounts payable and accrued and other liabilities related to the timing of vendor payments and payroll-related expenses.

Net cash provided by operating activities was $40.5 million for the year ended December 31, 2022, primarily attributable to changes in assets and liabilities of $244.7 million and $116.9 million of non-cash items related to stock-based compensation, depreciation and amortization, gain on extinguishment of convertible senior notes, amortization of debt discounts and issuance costs, lease expense related to right-of-use assets, and other non-cash items. This was offset by a net loss of $321.1 million. The primary source of cash related to changes in our assets and liabilities was a $243.9 million decrease in inventory related to the wind-down of RedfinNow. The primary use of cash related to changes in our assets and liabilities was a $48.9 million decrease in accounts payable and accrued and other liabilities related to the timing of vendor payments and payroll related expenses.

Net Cash Provided By (Used In) Investing Activities

Our primary investing activities include acquisitions of other companies and the purchase of investments and property and equipment, primarily related to capitalized software development expenses and leasehold improvements.

Net cash provided by investing activities was $34.4 million for the year ended December 31, 2024, primarily attributable to $45.6 million in net sales and maturities of U.S. government securities, partially offset by $11.2 million in purchases of property and equipment.

Net cash provided by investing activities was $97.5 million for the year ended December 31, 2023, primarily attributable to $109.5 million in net sales and maturities of U.S. government securities, partially offset by $12.1 million in purchases of property and equipment.

Net cash used in investing activities was $184.3 million for the year ended December 31, 2022, primarily attributable to cash paid for our acquisition of Bay Equity of $97.3 million, $65.5 million in net investments in U.S. government securities, and $21.5 million in purchases of property and equipment.

Net Cash Used In Financing Activities

Our primary financing activities have come from (i) our initial public offering in August 2017, (ii) sales of our common stock and 2023 notes in July 2018, our common stock and convertible preferred stock in April 2020, our 2025 notes in October 2020, and our 2027 notes in March 2021, (iii) our term loan entered into in October 2023, and (iv) the sale of our common stock pursuant to stock option exercises and our ESPP. Additionally, we generate a significant amount of financing cash flow activity due to borrowings from and repayments to our warehouse credit facilities and, historically, our secured revolving credit facility, which we terminated on December 29, 2022.

Net cash used in financing activities was $28.1 million for the year ended December 31, 2024, primarily attributable to $107.0 million used in connection with repurchases of our 2025 notes, $40.0 million used for the redemption of our convertible preferred stock, and a $5.3 million decrease in net borrowings under our warehouse credit facilities. This was partially offset by $125.0 million cash proceeds from the additional draw on our term loan.

Net cash used in financing activities was $245.4 million for the year ended December 31, 2023, primarily attributable to $241.8 million used in connection with repurchases of our 2025 notes, $57.1 million used to extinguish a portion of our 2025 and 2027 notes as part of the closing of our term loan, $23.5 million used to pay the remaining principal of our 2023 notes, and a $38.5 million decrease in net borrowings under our warehouse credit facilities. This was partially offset by $125.0 million cash proceeds from the closing of our term loan.

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Net cash used in financing activities was $332.1 million for the year ended December 31, 2022, primarily attributable to a $199.8 million decrease in net borrowings under our secured revolving credit facility, $83.6 million used in connection with repurchases of our 2025 notes, and a $51.1 million decrease in net borrowings under our warehouse credit facilities.

Critical Accounting Policies and Estimates

Discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and related disclosure of contingent assets and liabilities, revenue, and expenses at the date of the financial statements. Generally, we base our estimates on historical experience and on various other assumptions in accordance with GAAP that we believe to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies and estimates are those that we consider the most important to the portrayal of our financial condition and results of operations because they require our most difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. Based on this definition, we have identified the critical accounting policies and estimates addressed below. In addition, we have other key accounting policies and estimates that are described in Note 1 to our consolidated financial statements.

Revenue Recognition

Our key revenue components are brokerage revenue, partner revenue, rentals revenue, mortgage revenue, title revenue, and monetization revenue. Of these, we consider the most critical of our revenue recognition policies to be those related to commissions and fees charged on brokerage transactions closed by our lead agents. We recognize commission-based brokerage revenue upon closing of a brokerage transaction, less the amount of any commission refunds, closing-cost reductions, or promotional offers that may result in a material right. We determined that brokerage revenue primarily contains a single performance obligation that is satisfied upon the closing of a transaction, at which point the entire transaction price is earned. We evaluate our brokerage contracts and promotional pricing to determine if there are any additional material rights and allocate the transaction price based on standalone selling prices. Partner revenue consists of fees paid to us from partner agents or under other referral agreements, less the amount of any payments we make to homebuyers and home sellers. We earn a fixed percentage of the partner agent's commission based on the terms of our referral agreements. Due to variability in factors outside our control, including final sale prices and actual commission rates, we recognize revenue only upon closing of the underlying real estate transaction when such variability has been resolved.

Rentals revenue is primarily recognized on a straight-line basis over the term of the contract, which is generally less than one year. Revenue is presented net of sales allowances, which are not material.

Mortgage revenue is recognized (1) when an interest rate lock commitment is made to a customer, adjusted for a pull-through percentage, (2) for origination fees, when the purchase or refinance of a loan is complete, and (3) when the fair value of our interest rate lock commitments, forward sale commitments, and loans held for sale are recorded at current market quotes.

Title revenue includes fees earned from title settlement services. Substantially all fees and revenue from title services are recognized when the service is provided.

Monetization revenue includes advertising and Walk Score data services. Substantially all fees and revenue from monetization services are recognized when the service is provided.

We have utilized the practical expedient in ASC 606, Revenue from Contracts with Customers, and elected not to capitalize contract costs for contracts with customers with durations less than one year. We do not have significant remaining performance obligations or contract balances.

See Note 1 to our consolidated financial statements for further discussion of our revenue recognition policy.

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Goodwill

Goodwill represents the excess of the purchase price over the fair value of the net tangible assets and identifiable intangible assets acquired in a business combination. Goodwill is not amortized, but is subject to impairment testing. We assess the impairment of goodwill on an annual basis, during the fourth quarter, or whenever events or changes in circumstances indicate that goodwill may be impaired. We assess goodwill for possible impairment by performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying amount. When utilizing a quantitative assessment, we determine fair value at the reporting unit level based on a combination of an income approach and market approach. The income approach is based on estimated future cash flows, discounted at a rate that approximates the cost of capital of a market participant, while the market approach is based on guideline public company multiples and adjusted for the specific size and risk profile of the reporting units. To determine the fair value of a reporting unit, we consider discounted cash flow models and market data of comparable guideline companies. The assumptions used in these models are consistent with those we believe a market participant would use and adjusted for the specific size and risk profile of the reporting units. For Rent., we incorporated our expectations regarding the Zillow partnership deal and estimated economic impacts on the business into our valuation model (see Note 15).

Based on our annual goodwill impairment test performed for all five reporting units in the fourth quarter of 2024, the estimated fair values of four reporting units substantially exceeded their carrying values, and for the Rent. reporting unit, the fair value exceeded its carrying value by approximately 20%. No goodwill impairment charges were recorded in the years ended December 31, 2024 or 2023.

Recent Accounting Standards

For information on recent accounting standards, see Note 1 to our consolidated financial statements.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Our primary operations are within the United States. We are exposed to market risks in the ordinary course of our business. These risks primarily consist of fluctuations in interest rates.

Interest Rate Risk

Our investment policy allows us to maintain a portfolio of cash equivalents and investments in a variety of securities, including U.S. treasury and agency issues, bank certificates of deposit that are 100% insured by the Federal Deposit Insurance Corporation, and SEC-registered money market funds that consist of a minimum of $1 billion in assets and meet the above requirements. The goals of our investment policy are liquidity and capital preservation. We do not enter into investments for trading or speculative purposes.

As of December 31, 2024, we had cash and cash equivalents of $124.7 million. Declines in interest rates would reduce future investment income. Assuming no change in our outstanding cash and cash equivalents during the first quarter of 2025, a hypothetical 10% change in interest rates, occurring during and sustained throughout that quarter, would not have a material impact on our financial results for that quarter.

We are exposed to interest rate risk on our term loan. Interest is charged at the Secured Overnight Financing Rate ("SOFR") +575 basis points for the first five full fiscal quarters after closing, with step-downs to SOFR +550 basis points and SOFR +525 basis points thereafter upon achieving agreed performance metrics.

We are also exposed to interest rate risk on our mortgage loans held for sale and IRLCs associated with our mortgage loan origination services. We manage this interest rate risk through the use of forward sales commitments on both a best efforts whole loans basis and on a mandatory basis. Forward sales commitments entered into on a mandatory basis are done through the use of commitments to sell mortgage-backed securities. We do not enter into or hold derivatives for trading or speculative purposes. The fair value of our IRLCs and forward sales commitments are reflected in other current assets and accrued and other liabilities, as applicable, with changes in the fair value of these commitments recognized as revenue. The net fair value change for the periods presented were not material. See Note 4 to our consolidated financial statements for a summary of the fair value of our forward sales commitments and our IRLCs.

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Foreign Currency Exchange Risk

As our operations in Canada have been limited, and we do not maintain a significant balance of foreign currency, we do not currently face significant foreign currency exchange rate risk.

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Item 8. Financial Statements and Supplementary Data

Index to Consolidated Financial Statements


			Page
Reports of Independent Registered Public Accounting Firm (PCAOB ID No.34)			51
Consolidated Balance Sheets			53
Consolidated Statements of Comprehensive Loss			54
Consolidated Statements of Cash Flows			55
Consolidated Statements of Changes in Mezzanine Equity and Stockholders' Equity			56
Index to Notes to Consolidated Financial Statements			57

Index to Consolidated Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of Redfin Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Redfin Corporation and subsidiaries (the "Company") as of December 31, 2024 and 2023, the related consolidated statements of comprehensive loss, cash flows, and changes in mezzanine equity and stockholders' equity, for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 27, 2025, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Goodwill Valuation – Rentals Reporting Unit –– Refer to Footnote 1 and 8 to the Financial Statements

Critical Audit Matter Description

The Company performed an impairment evaluation of the goodwill for the Rentals reporting unit by comparing the estimated fair value of the reporting unit to its carrying value. In order to estimate the fair value of the reporting unit, management is required to make significant estimates and assumptions related to the discount rate and forecasts of future revenues and Earnings Before Interest Taxes Depreciation & Amortization ("EBITDA") margins, including the impact to estimates of the Zillow partnership deal as disclosed in Note 15 to the financial statements. Changes in these assumptions could have a significant impact on the fair value of the reporting unit, the amount of any goodwill impairment charge, or both. The Company’s overall goodwill balance was $461.3 million as of December 31, 2024, of which $159.2 million related to the Rentals reporting unit.The Company performed its annual quantitative test for goodwill impairment during the fourth quarter of 2024. The Company determined that the fair value of the Rentals reporting unit exceeded its carrying value by approximately 20 percent; therefore, no impairment was recognized during the year ended December 31, 2024.

We identified the impairment evaluation of goodwill for the Rentals reporting unit as a critical audit matter because of the inherent subjectivity involved in management's estimates and assumptions related to the discount rate and forecasts of future revenues and EBITDA margins, including the impact on estimates and assumptions of the Zillow partnership deal as disclosed in Note 15 to the financial statements. The audit procedures to evaluate the reasonableness of management's estimates and assumptions related to the selection of the discount rate and forecasts of future revenues and EBITDA margins required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the selection of the discount rate and forecasts of future revenues and EBITDA margins for the Rentals reporting unit included the following:

•We tested the effectiveness of controls over management's goodwill impairment evaluation, including those over the selection of the discount rate and management's development of forecasts of future revenues and EBITDA margins.

•We evaluated the reasonableness of management's forecasts of future Revenue and EBITDA margins by comparing the forecasts to (1) historical results, (2) internal communications to management and those charged with governance, (3) forecasted information included in analyst and industry reports for the industry that the reporting unit operates within, and (4) expected deal terms related to price per lead generation.

•We performed lookback procedures related to the final contractual terms of the Zillow partnership deal, which involved the comparison of the actual deal terms to the estimates and assumptions used in the forecasts of future Revenue and EBITDA margins.

•With the assistance of our fair value specialists, we evaluated the reasonableness of the discount rate by (1) testing the source information underlying the determination of the discount rate; (2) testing the mathematical accuracy of the calculations; and (3) developing a range of independent estimates and comparing those to the discount rate selected by management.

/s/ Deloitte & Touche LLP

Seattle, Washington

February 27, 2025

We have served as the Company's auditor since 2013.

Index to Consolidated Financial Statements

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the stockholders and the Board of Directors of Redfin Corporation

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Redfin Corporation and subsidiaries (the “Company”) as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2024, of the Company and our report dated February 27, 2025, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP

Seattle, Washington

February 27, 2025

Index to Consolidated Financial Statements

Redfin Corporation and Subsidiaries

Consolidated Balance Sheets

(in thousands, except share and per share amounts)


	December 31,
	2024		2023
Assets
Current assets
Cash and cash equivalents	$	124,743	$	149,759
Restricted cash	229		1,241
Short-term investments	—		41,952
Accounts receivable, net of allowances for credit losses of $4,571 and $3,234	48,730		51,738
Loans held for sale	152,426		159,587
Prepaid expenses	26,853		33,296
Other current assets	22,457		7,472

Total current assets	375,438		445,045
Property and equipment, net	41,302		46,431
Right-of-use assets, net	23,713		31,763
Mortgage servicing rights, at fair value	2,736		32,171
Long-term investments	—		3,149
Goodwill	461,349		461,349
Intangible assets, net	99,543		123,284
Other assets, noncurrent	8,376		10,456

Total assets	$	1,012,457	$	1,153,648
Liabilities, mezzanine equity, and stockholders' (deficit) equity
Current liabilities
Accounts payable	$	16,847	$	10,507
Accrued and other liabilities	82,709		90,360
Warehouse credit facilities	146,629		151,964
Convertible senior notes, net	73,516		—
Lease liabilities	12,862		15,609

Total current liabilities	332,563		268,440
Lease liabilities, noncurrent	19,855		29,084
Convertible senior notes, net, noncurrent	498,691		688,737
Term loan	243,344		124,416

Deferred tax liabilities	672		264

Total liabilities	1,095,125		1,110,941
Commitments and contingencies (Note 7)
Series A convertible preferred stock—par value $0.001 per share; 10,000,000 shares authorized; 0 and 40,000 shares issued and outstanding at December 31, 2024 and 2023, respectively	—		39,959
Stockholders’ (deficit) equity
Common stock—par value $0.001 per share; 500,000,000 shares authorized; 126,389,289 and 117,372,171 shares issued and outstanding at December 31, 2024 and 2023, respectively	126		117
Additional paid-in capital	905,506		826,146
Accumulated other comprehensive loss	(166)		(182)
Accumulated deficit	(988,134)		(823,333)
Total stockholders’ (deficit) equity	(82,668)		2,748
Total liabilities, mezzanine equity, and stockholders’ (deficit) equity	$	1,012,457	$	1,153,648

See Notes to the consolidated financial statements.

Index to Consolidated Financial Statements

Redfin Corporation and Subsidiaries

Consolidated Statements of Comprehensive Loss

(in thousands, except share and per share amounts)


	Year Ended December 31,
	2024		2023		2022
Revenue	$	1,042,979	$	976,672	$	1,099,574
Cost of revenue	678,778		646,853		790,455
Gross profit	364,201		329,819		309,119
Operating expenses
Technology and development	163,927		183,294		178,924
Marketing	114,481		117,863		155,309
General and administrative	235,364		238,790		243,390
Restructuring and reorganization	5,684		7,927		32,353
Total operating expenses	519,456		547,874		609,976
Loss from continuing operations	(155,255)		(218,055)		(300,857)
Interest income	6,348		10,532		6,639
Interest expense	(27,780)		(9,524)		(8,886)
Income tax benefit (expense)	530		(979)		(116)
Gain on extinguishment of convertible senior notes	12,000		94,019		57,193
Other expense, net	(644)		(2,385)		(3,770)
Net loss from continuing operations	(164,801)		(126,392)		(249,797)
Net loss from discontinued operations	—		(3,634)		(71,346)
Net loss	$	(164,801)	$	(130,026)	$	(321,143)

Dividends on convertible preferred stock	$	(1,073)	$	(1,074)	$	(1,560)

Net loss from continuing operations attributable to common stock—basic and diluted	$	(165,874)	$	(127,466)	$	(251,357)
Net loss attributable to common stock—basic and diluted	$	(165,874)	$	(131,100)	$	(322,703)

Net loss from continuing operations per share attributable to common stock—basic and diluted	$	(1.36)	$	(1.13)	$	(2.33)
Net loss per share attributable to common stock—basic and diluted	$	(1.36)	$	(1.16)	$	(2.99)

Weighted-average shares used to compute net loss per share attributable to common stock—basic and diluted	121,677,971		113,152,752		107,927,464

Net loss	$	(164,801)	$	(130,026)	$	(321,143)
Other comprehensive income
Foreign currency translation adjustments	(24)		(71)		94
Unrealized gain on available-for-sale securities	40		690		533
Comprehensive loss	$	(164,785)	$	(129,407)	$	(320,516)

See Notes to the consolidated financial statements.

Index to Consolidated Financial Statements

Redfin Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(in thousands)


	Year Ended December 31,
	2024		2023		2022
Operating Activities
Net loss	$	(164,801)	$	(130,026)	$	(321,143)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	42,768		62,851		64,907
Stock-based compensation	71,159		70,935		68,257
Amortization of debt discount and issuance costs	3,116		3,620		6,137
Non-cash lease expense	11,815		16,269		16,234
Impairment costs	—		1,948		1,136

Net (gain) loss on IRLCs, forward sales commitments, and loans held for sale	(19)		(1,992)		14,427
Change in fair value of mortgage servicing rights, net	(892)		3,198

Redfin Corp 10-K