8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 02, 2024

Frontdoor, Inc.

(Exact name of Registrant as Specified in Its Charter)

Delaware	001-38617	82-3871179
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
3400 Players Club Parkway,
Memphis, Tennessee		38125
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: 901 701-5000

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, par value $0.01 per share	FTDR	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

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. ☐

Item 2.02 Results of Operations and Financial Condition.

On May 2, 2024, Frontdoor, Inc., issued a press release announcing its financial results for its fiscal quarter ended March 31, 2024. A copy of the press release is attached hereto as Exhibit 99.1 and incorporated herein by reference.

The information contained in Item 2.02 of this Current Report on Form 8-K, including the text of the press release attached as Exhibit 99.1, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description of Exhibit
99.1	Press Release of Frontdoor, Inc., dated May 2, 2024
104	The cover page from this Current Report on Form 8-K, formatted in Inline XBRL

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:	May 2, 2024	By:	/s/ Jessica P. Ross
			Name: Jessica P. Ross Title: Senior Vice President and Chief Financial Officer

EX-99.1

Exhibit 99.1

Frontdoor Announces First-Quarter 2024 Revenue Increased 3% to $378 Million;

Gross Profit Margin Expanded 510 bps to 51%;

Net Income of $34 Million and Adjusted EBITDA(1) of $71 Million;

Raising Full-Year 2024 Gross Profit Margin and Adjusted EBITDA(2) Outlook;

Relaunched the American Home Shield Brand in April

MEMPHIS, TENN. — May 2, 2024 — Frontdoor, Inc. (NASDAQ: FTDR), the nation’s leading provider of home warranties, today announced its first-quarter 2024 results.

Financial Results
	Three Months Ended
	March 31,
$ millions (except as noted)	2024		2023		Change
Revenue	$	378	$	367		3	%
Gross Profit		195		170		14	%
Net Income		34		22		56	%
Diluted Earnings per Share		0.43		0.27		62	%
Adjusted Net Income(1)		35		23		49	%
Adjusted Diluted Earnings per Share(1)		0.44		0.29		54	%
Adjusted EBITDA(1)		71		54		33	%
Home Warranties (number in millions)		1.96		2.09		(6	)%

First-Quarter 2024 Summary

•Revenue increased 3% to $378 million and was comprised of an 11% increase from price that was partly offset by an 8% decline from lower volume

•Gross profit margin expanded 510 basis points to 51% as a result of higher realized price, a transition to higher service fees and continued process improvement initiatives that was partly offset by inflationary cost pressures

•Net income and Diluted earnings per share increased to $34 million and $0.43, respectively

•Adjusted EBITDA(1) increased 33% to $71 million

•Net cash provided from operating activities of $84 million

Full-Year 2024 Outlook

•Maintaining revenue range of $1.81 billion to $1.84 billion

•Increasing gross profit margin range to approximately 50.0%

•Increasing Adjusted EBITDA(2) range to $360 million to $370 million

“Frontdoor continues to operate extremely well and is off to a strong start in 2024," said Chairman and Chief Executive Officer Bill Cobb. “While earnings continue to exceed expectations, our top priority is to find new and innovative ways to increase demand for our services. The American Home Shield brand relaunch is a significant component of this strategy, and I am very pleased with the initial reaction to our new celebrity spokesperson, Rachel Dratch, as 'Warrantina'. We are truly bringing a refreshed and high energy look to our brand and are optimistic it will improve the growth trajectory for home warranties for years to come."

“I am extremely pleased with our first-quarter financial performance,” said Chief Financial Officer Jessica Ross. “We substantially beat our first-quarter Adjusted EBITDA outlook as we continue to deliver and execute on our margin expansion initiatives. As a result, we are increasing our full-year 2024 gross profit margin and Adjusted EBITDA targets while continuing to make investments to drive growth."

First-Quarter 2024 Results

Revenue by Customer Channel
	Three Months Ended
	March 31,
$ millions	2024		2023		Change
Renewals	$	298	$	278		7	%
Real estate (First-Year)		27		33		(17	)%
Direct-to-consumer (First-Year)		36		44		(19	)%
Other		17		11		49	%
Total	$	378	$	367		3	%

First-quarter 2024 revenue increased 3% to $378 million, which was comprised of an 11% increase from price that was partially offset by an 8% decline from lower volume.

•Renewal revenue increased 7% due to improved price realization that was partially offset by lower volume;

•Real estate revenue decreased 17% due to lower sales as a result of the challenging real estate market that was partially offset by improved price realization;

•Direct-to-consumer revenue decreased 19% primarily due to lower sales, which we believe was driven by a decline in overall category demand for home warranties; and

•Other revenue increased $6 million due to higher on-demand home services, primarily new HVAC sales.

First-quarter 2024 net income was $34 million, or diluted earnings per share of $0.43.

Period-over-Period Adjusted EBITDA(1) Bridge

(In millions)
Three Months Ended March 31, 2023	$	54
Impact of change in revenue		14
Contract claims costs		10
Sales and marketing costs		(7	)
Customer service costs		1
General and administrative costs		(3	)
Interest and net investment income		1
Three Months Ended March 31, 2024	$	71

First-quarter 2024 Adjusted EBITDA(1) of $71 million increased 33% versus the prior year period, and includes:

•$14 million from higher revenue conversion(3), as price increases were partly offset by lower volume;

•$10 million of lower contract claims costs(4), excluding the impact of claims costs related to the change in revenue. The decrease in contract claims costs reflects:

oA transition to higher service fees that drove a lower number of service requests per customer as well as improved net cost per service request;

oContinued process improvement initiatives, specifically better cost management across our contractor network; partially offset by

oOngoing inflationary cost pressures from our contractor network, replacement parts and equipment; and

oFavorable claims cost development of $1 million, compared to a $6 million favorable cost development in the first quarter of 2023

•$7 million of higher sales and marketing costs, primarily investments to drive direct-to-consumer sales; and

•$3 million of higher G&A costs primarily due to increased personnel costs.

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Cash Flow

	Three Months Ended
	March 31,
(In millions)	2024			2023
Net cash provided from (used for):
Operating activities	$	84		$	60
Investing activities		(10	)		(8	)
Financing activities		(21	)		(7	)
Cash increase during the period	$	53		$	45

Net cash provided from operating activities was $84 million for the three months ended March 31, 2024 and was comprised of $51 million in earnings adjusted for non-cash charges and $34 million in cash provided from working capital, partially offset by $1 million in payments for restructuring charges.

Net cash used for investing activities was $10 million for the three months ended March 31, 2024 and was primarily comprised of capital expenditures related to technology projects.

Net cash used for financing activities was $21 million for the three months ended March 31, 2024 and was primarily comprised of $13 million (including taxes and fees) to repurchase 0.4 million shares and $4 million of scheduled debt payments.

Free Cash Flow(1) was $73 million for the three months ended March 31, 2024.

Cash as of March 31, 2024 was $378 million and was comprised of $165 million of restricted net assets and $213 million of Unrestricted Cash.

Capital Allocation Update

•Consistent with our stated capital allocation strategy, the company repurchased $33 million of shares in March and April. The company expects to continue to use excess cash to repurchase shares under our current 3-year, $400 million authorization, absent any acquisitions.

Second-Quarter 2024 Outlook

•Revenue of $530 million to $540 million, a 2% increase over the prior-year period.

•Adjusted EBITDA(2) of $130 million to $140 million, a 12% increase over the prior-year period.

Updated Full-Year 2024 Outlook

•Revenue to grow approximately 2% to 3% to $1.81 billion to $1.84 billion. Key assumptions include:

oA mid-single digit increase in renewals channel revenue;

oApproximately 10% decline in direct-to-consumer channel revenue;

oA 15% to 20% decline in real estate channel revenue;

oApproximately 30% increase in other revenue, which is primarily driven by the new HVAC program;

oThe number of home warranties is expected to decline 1% to 3%.

•Increasing gross profit margin to approximately 50%.

•SG&A of $580 million to $595 million.

•Increasing Adjusted EBITDA(2) to $360 million to $370 million.

•Capital expenditures of approximately $35 million to $45 million.

•Annual effective tax rate of approximately 25%.

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First-Quarter 2024 Earnings Conference Call

Frontdoor has scheduled a conference call today, May 2, 2024, at 7:30 a.m. Central time (8:30 a.m. Eastern time). During the call, Bill Cobb, Chairman and Chief Executive Officer, and Jessica Ross, Chief Financial Officer, will discuss the company’s operational performance and financial results for first-quarter 2024 and respond to questions from the investment community. To participate on the conference call, interested parties should call 1-833-470-1428 (or international participants, 1-929-526-1599) and enter conference ID 300812. Additionally, the conference call will be available via webcast which will include a slide presentation highlighting the company’s results. To participate via webcast and view the slide presentation, visit Frontdoor’s investor relations home page. The call will be available for replay for approximately 60 days. To access the replay of this call, please call 1-866-813-9403 and enter conference ID 139025 (international participants: +44-204-525-0658, conference ID 139025).

About Frontdoor, Inc.

Frontdoor is reimagining how homeowners maintain and repair their most valuable asset – their home. As the parent company of two leading brands, we bring over 50 years of experience in providing our members with comprehensive options to protect their homes from costly and unexpected breakdowns through our extensive network of pre-qualified professional contractors. American Home Shield, the category leader in home warranties with approximately two million members, gives homeowners budget protection and convenience, covering up to 23 essential home systems and appliances. Frontdoor is a cutting edge, one-stop app for home repair and maintenance. Enabled by our Streem technology, the app empowers homeowners by connecting them in real time through video chat with pre-qualified experts to diagnose and solve their problems. The Frontdoor app also offers homeowners a range of other benefits including DIY tips, discounts and more. For more information about American Home Shield and Frontdoor, please visit frontdoorhome.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, in particular, projected future performance and any statements about Frontdoor’s plans, strategies and prospects. Forward-looking statements can be identified by the use of forward-looking terms such as “believe,” “expect,” “estimate,” “could,” “should,” “intend,” “may,” “plan,” “seek,” “anticipate,” “project,” “will,” “shall,” “would,” “aim,” or other comparable terms. These forward-looking statements are subject to known and unknown risks and uncertainties, many of which may be beyond our control. Such risks and uncertainties include, but are not limited to: changes in macroeconomic conditions, including inflation and global supply chain challenges, especially as they may affect existing home sales, interest rates, consumer confidence or labor availability; the success of our business strategies; the ability of our marketing efforts to be successful or cost-effective; our dependence on our real estate and direct-to-consumer customer acquisition channels and our renewal channel; changes in the source and intensity of competition in our market; our ability to attract, retain and maintain positive relations with third-party contractors and vendors; increases in parts, appliance and home system prices, and other operating costs; our ability to attract and retain qualified key employees and labor availability in our customer service operations; our dependence on third-party vendors, including business process outsourcers, and third-party component suppliers; cybersecurity breaches, disruptions or failures in our technology systems; our ability to protect the security of personal information about our customers; lawsuits, enforcement actions and other claims by third parties or governmental authorities; evolving corporate governance and disclosure regulations and expectations related to environmental, social and governance matters; physical effects of climate change, including adverse weather conditions and Acts of God, along with the increased focus on sustainability; increases in tariffs or changes to import/export regulations; our ability to protect our intellectual property and other material proprietary rights; negative reputational and financial impacts resulting from acquisitions or strategic transactions; requirement to recognize impairment charges; third-party use of our trademarks as search engine keywords to direct our potential customers to their own websites; inappropriate use of social media by us or other parties to harm our reputation; special risks applicable to operations outside the United States by us or our business process outsource providers; a return on investment in our common stock is dependent on appreciation in the price; restrictions in our certificate of incorporation related to an acquisition of us or to our lawsuits against us or our directors or officers; the effects of our significant indebtedness; increases in interest rates increasing the cost of servicing our indebtedness; increased borrowing costs due to lowering or withdrawal of the credit ratings, outlook or watch assigned to us, our debt securities or our credit facilities; and our ability to generate significant cash needed to fund our operations and service our debt. We caution you that forward-looking statements are not guarantees of future performance or outcomes and that actual performance and outcomes, including, without limitation, our actual results of operations, financial condition and liquidity, and the development of new markets or market segments in which we operate, may differ materially from those made in or suggested by the forward-looking statements contained in this news release. For a discussion of other important factors that could cause Frontdoor’s results to differ materially from those expressed in, or implied by, the forward-looking statements included in this document, refer to the risks and uncertainties detailed from time to time in Frontdoor’s periodic reports filed with the SEC, including the disclosure contained in Item 1A.

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Risk Factors in our 2023 Annual Report on Form 10-K filed with the SEC, as such factors may be updated from time to time in Frontdoor’s periodic filings with the SEC. Except as required by law, Frontdoor does not undertake any obligation to update or revise the forward-looking statements to reflect new information or events or circumstances that occur after the date of this news release or to reflect the occurrence of unanticipated events or otherwise. Readers are advised to review Frontdoor’s filings with the SEC, which are available from the SEC’s EDGAR database at sec.gov, and via Frontdoor’s website at frontdoorhome.com.

Non-GAAP Financial Measures

To supplement Frontdoor’s results presented in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”), Frontdoor has disclosed the non-GAAP financial measures of Adjusted EBITDA, Free Cash Flow, Adjusted Net Income, Adjusted Diluted Earnings Per Share, and Unrestricted Cash.

We define "Adjusted EBITDA" as net income before depreciation and amortization expense; goodwill and intangibles impairment; restructuring charges; provision for income taxes; non-cash stock-based compensation expense; interest expense; loss on extinguishment of debt; and other non-operating expenses. We believe Adjusted EBITDA is useful for investors, analysts and other interested parties as it facilitates company-to-company operating performance comparisons by excluding potential differences caused by variations in capital structures, taxation, the age and book depreciation of facilities and equipment, restructuring initiatives and equity-based, long-term incentive plans.

We define “Free Cash Flow” as net cash provided from operating activities less property additions. Free Cash Flow is not a measurement of our financial performance or liquidity under U.S. GAAP and does not purport to be an alternative to net cash provided from operating activities or any other performance or liquidity measures derived in accordance with U.S. GAAP. Free Cash Flow is useful as a supplemental measure of our liquidity. Management uses Free Cash Flow to facilitate company-to-company cash flow comparisons, which may vary from company-to-company for reasons unrelated to operating performance.

We define “Adjusted Net Income” as net income before: amortization expense; restructuring charges; loss on extinguishment of debt; other non-operating expenses; and the tax impact of the aforementioned adjustments. We believe Adjusted Net Income is useful for investors, analysts and other interested parties as it facilitates company-to-company operating performance comparisons by excluding potential differences caused by items listed in this definition.

We define “Adjusted Diluted Earnings per Share” as Adjusted Net Income divided by the weighted-average diluted common shares outstanding.

We define “Unrestricted Cash” as cash not subject to third-party restrictions. For additional information related to our third-party restrictions, see “Liquidity and Capital Resources — Liquidity” under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2023 Annual Report on Form 10-K filed with the SEC.

See the schedules attached hereto for additional information and reconciliations of such non-GAAP financial measures. Management believes these non-GAAP financial measures provide useful supplemental information for its and investors’ evaluation of Frontdoor’s business performance and are useful for period-over-period comparisons of the performance of Frontdoor’s business. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant to be considered in isolation or as a substitute for the related financial information prepared in accordance with U.S. GAAP. In addition, these non-GAAP financial measures may not be the same as similarly entitled measures reported by other companies.

© 2024 Frontdoor, Inc. All rights reserved. The following terms, which may be used in this press release, are trademarks of Frontdoor, Inc. and its subsidiaries: Frontdoor®, American Home Shield®, HSA™, OneGuard®, Landmark Home Warranty®, Streem®, the Streem logo and the Frontdoor logo. All other trademarks used herein are the property of their respective owners.

For further information, contact:

Investor Relations:	Media:
Matt Davis	Tom Collins
901.701.5199	901.701.5198
ir@frontdoorhome.com	mediacenter@frontdoorhome.com

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(1)See “Reconciliations of Non-GAAP Financial Measures” accompanying this release for a reconciliation of Adjusted EBITDA, Free Cash Flow, Adjusted Net Income and Adjusted Diluted Earnings per Share, each a non-GAAP measure, to the nearest GAAP measure. See “Non-GAAP Financial Measures” included in this release for descriptions of calculations of these measures. Amounts presented in the reconciliations and other tables presented herein may not sum due to rounding.

(2)A reconciliation of the forward-looking second-quarter and full-year 2024 Adjusted EBITDA outlook to net income cannot be provided without unreasonable effort because of the inherent difficulty of accurately forecasting the occurrence and financial impact of the various adjusting items necessary for such reconciliation that have not yet occurred, are out of our control, or cannot be reasonably predicted. For the same reasons, the company is unable to assess the probable significance of the unavailable information, which could have a material impact on its future GAAP financial results.

(3)Revenue conversion includes the impact of the change in the number of home warranties as well as the impact of year-over-year price changes. The impact of the change in the number of home warranties considers the associated revenue on those plans less an estimate of contract claims costs based on margin experience in the prior year period.

(4)Contract claims costs includes the impact of changes in service request incidence, inflation and other drivers associated with the number of home warranties in the prior year period. The impact on contract claims costs resulting from year-over-year changes in the number of home warranties is included in revenue conversion above.

6

Frontdoor, Inc.

Consolidated Statements of Operations and Comprehensive Income (Unaudited)

(In millions, except per share data)

	Three Months Ended
	March 31,
	2024			2023
Revenue	$	378		$	367
Cost of services rendered		184			197
Gross Profit		195			170
Selling and administrative expenses		135			125
Depreciation and amortization expense		9			9
Restructuring charges		—			1
Interest expense		10			10
Interest and net investment income		(5	)		(3	)
Income before Income Taxes		45			29
Provision for income taxes		11			7
Net Income	$	34		$	22
Other Comprehensive Income (Loss), Net of Income Taxes:
Unrealized gain (loss) on derivative instruments, net of income taxes		2			(2	)
Total Other Comprehensive Income (Loss), Net of Income Taxes		2			(2	)
Comprehensive Income	$	35		$	20
Earnings per Share:
Basic	$	0.43		$	0.27
Diluted	$	0.43		$	0.27
Weighted-average Common Shares Outstanding:
Basic		78.3			81.5
Diluted		79.0			81.9

7

Frontdoor, Inc.

Condensed Consolidated Statements of Financial Position (Unaudited)

(In millions, except share data)

	As of
	March 31,			December 31,
	2024			2023
Assets:
Current Assets:
Cash and cash equivalents	$	378			325
Receivables, less allowance of $4 and $5, respectively		4			6
Prepaid expenses and other current assets		30			32
Total Current Assets		412			363
Other Assets:
Property and equipment, net		64			60
Goodwill		503			503
Intangible assets, net		143			143
Operating lease right-of-use assets		7			3
Deferred customer acquisition costs		11			12
Other assets		6			5
Total Assets	$	1,146			1,089
Liabilities and Shareholders' Equity:
Current Liabilities:
Accounts payable	$	70			76
Accrued liabilities:
Payroll and related expenses		18			38
Home warranty claims		64			76
Other		33			22
Deferred revenue		158			102
Current portion of long-term debt		17			17
Total Current Liabilities		360			331
Long-Term Debt		573			577
Other Long-Term Liabilities:
Deferred tax liabilities, net		25			25
Operating lease liabilities		20			16
Other long-term liabilities		5			5
Total Other Long-Term Liabilities		51			46
Commitments and Contingencies
Shareholders' Equity:
Common stock, $0.01 par value; 2,000,000,000 shares authorized; 86,871,669 shares issued and 78,296,296 shares outstanding as of March 31, 2024 and 86,553,387 shares issued and 78,378,511 shares outstanding as of December 31, 2023		1			1
Additional paid-in capital		120			117
Retained earnings		330			296
Accumulated other comprehensive income		7			6
Less treasury stock, at cost; 8,575,373 shares as of March 31, 2024 and 8,174,876 shares as of December 31, 2023		(296	)		(283	)
Total Shareholders' Equity		162			136
Total Liabilities and Shareholders' Equity	$	1,146			1,089

8

Frontdoor, Inc.

Consolidated Statements of Cash Flows (Unaudited)

(In millions)

	Three Months Ended
	March 31,
	2024			2023
Cash and Cash Equivalents at Beginning of Period	$	325		$	292
Cash Flows from Operating Activities:
Net Income		34			22
Adjustments to reconcile net income to net cash provided from operating activities:
Depreciation and amortization expense		9			9
Deferred income tax benefit		—			(2	)
Stock-based compensation expense		7			5
Restructuring charges		—			1
Payments for restructuring charges		(1	)		(1	)
Other		1			—
Changes in working capital:
Receivables		1			(1	)
Prepaid expenses and other current assets		2			(6	)
Accounts payable		(7	)		2
Deferred revenue		57			46
Accrued liabilities		(31	)		(24	)
Current income taxes		11			9
Net Cash Provided from Operating Activities		84			60
Cash Flows from Investing Activities:
Purchases of property and equipment		(10	)		(8	)
Net Cash Used for Investing Activities		(10	)		(8	)
Cash Flows from Financing Activities:
Repayments of debt		(4	)		(4	)
Repurchase of common stock		(13	)		—
Other financing activities		(4	)		(3	)
Net Cash Used for Financing Activities		(21	)		(7	)
Cash Increase During the Period		53			45
Cash and Cash Equivalents at End of Period	$	378		$	337

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Reconciliations of Non-GAAP Financial Measures

The following table presents reconciliations of net income to Adjusted Net Income.

	Three Months Ended
	March 31,
(In millions, except per share amounts)	2024		2023
Net Income	$	34	$	22
Amortization expense		1		1
Restructuring charges		—		1
Tax impact of adjustments		—		(1	)
Adjusted Net Income	$	35	$	23
Adjusted Earnings per Share:
Basic	$	0.43	$	0.27
Diluted	$	0.43	$	0.27
Weighted-average common shares outstanding:
Basic		78.3		81.5
Diluted		79.0		81.9

The following table presents reconciliations of net cash provided from operating activities to Free Cash Flow.

	Three Months Ended
	March 31,
(In millions)	2024			2023
Net cash provided from operating activities	$	84		$	60
Property additions		(10	)		(8	)
Free Cash Flow	$	73		$	52

The following table presents reconciliations of net income to Adjusted EBITDA.

	Three Months Ended
	March 31,
(In millions)	2024		2023
Net Income	$	34	$	22
Depreciation and amortization expense		9		9
Restructuring charges		—		1
Provision for income taxes		11		7
Non-cash stock-based compensation expense		7		5
Interest expense		10		10
Adjusted EBITDA	$	71	$	54

Key Business Metrics

	As of March 31,
	2024				2023
Number of home warranties (in millions)		1.96				2.09
Renewals		1.51				1.56
First-Year Direct-To-Consumer		0.27				0.30
First-Year Real Estate		0.19				0.24
Reduction in number of home warranties		(6	)	%		(4	)	%
Customer retention rate(1)		76.3		%		75.9		%

(1)Customer retention rate is presented on a rolling 12-month basis in order to avoid seasonal anomalies.

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Document And Entity Information	May 02, 2024
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Document Type	8-K
Amendment Flag	false
Document Period End Date	May 02, 2024
Entity Registrant Name	Frontdoor, Inc.
Entity Central Index Key	0001727263
Entity Emerging Growth Company	false
Entity File Number	001-38617
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	82-3871179
Entity Address, Address Line One	3400 Players Club Parkway,
Entity Address, City or Town	Memphis
Entity Address, State or Province	TN
Entity Address, Postal Zip Code	38125
City Area Code	901
Local Phone Number	701-5000
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common stock, par value $0.01 per share
Trading Symbol	FTDR
Security Exchange Name	NASDAQ