Frontdoor, Inc. reported a significant increase in financial performance for the fiscal year ending December 31, 2025, with total revenue reaching $2,093 million, a 14% increase from $1,843 million in 2024. The company also saw net income rise to $255 million, up from $235 million the previous year, and Adjusted EBITDA increased to $553 million from $443 million. This growth was largely attributed to the acquisition of 2-10 Home Buyers Warranty (2-10 HBW) in December 2024, which contributed approximately $188 million to revenue in 2025. The company’s revenue composition remained stable, with 76% derived from existing customer renewals, while new home warranty sales and direct-to-consumer sales accounted for 7% and 8%, respectively.
In terms of operational metrics, Frontdoor had approximately 2.1 million active home warranties as of December 31, 2025, a slight decrease from 2.12 million in 2024. The customer retention rate was reported at 79.2%, down from 79.9% the previous year, reflecting challenges in the real estate market that impacted the number of renewed home warranties. The company’s contractor network, which includes around 17,000 independent contractors, completed 84% of home warranty service requests, indicating a strong reliance on this network for service delivery.
Strategically, Frontdoor has focused on expanding its non-warranty services, including HVAC upgrades and smart home technology installations, which are marketed to its existing warranty customer base. The company has also implemented dynamic pricing strategies to enhance customer acquisition and retention. The acquisition of 2-10 HBW has diversified Frontdoor's offerings, allowing it to provide builder-backed and insurance-backed warranty options, which are expected to drive future growth.
Looking ahead, Frontdoor anticipates continued growth opportunities within the U.S. home services industry, which is valued at over $500 billion. The company plans to leverage its leading position in the home warranty market to expand into adjacent service categories and enhance its technology platform for improved customer engagement. However, the company also faces challenges from macroeconomic conditions, including inflation and high interest rates, which could impact consumer demand and operational costs. Frontdoor remains committed to optimizing its operations and maintaining strong financial health as it navigates these challenges.
About Frontdoor, Inc.
Frontdoor, Inc. is a leading provider of home warranties and structural warranties in the U.S., offering protection for home systems, appliances, and new construction. Its brands include American Home Shield and 2-10 HBW. The company serves homeowners, builders, and real estate partners through a nationwide contractor network, leveraging technology for service efficiency, customer retention, and expansion into non-warranty home services.
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