Segment Reporting and Revenue

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Segment Reporting and Revenue

Segment Reporting and Revenue

In its operation of our business, our management, including our chief operating decision maker ("CODM"), who is also our chief executive officer, evaluates the performance of our operating segments based on our statement of operations results, inclusive of net loss. We do not analyze discrete segment balance sheet information related to long-term assets, substantially all of which are located in the United States. We have six operating segments and four reportable segments, real estate services, properties, rentals, and mortgage. As a result of our decision to wind-down RedfinNow operations, we plan to report our properties segment as a discontinued operation beginning with the period during which we complete wind-down of the business.

We generate revenue primarily from commissions and fees charged on each real estate services transaction closed by our lead agents or partner agents, from the sale of RedfinNow homes, from subscription-based product offerings for our rentals business, and from the origination, sales, and servicing of mortgages. Our key revenue components are brokerage revenue, partner revenue, properties revenue, rentals revenue, mortgage revenue, and other revenue.

Information on each of the reportable and other segments and reconciliation to consolidated net loss is presented in the table below. We have assigned certain previously reported expenses to each segment to conform to the way we internally manage and monitor our business. We allocated indirect costs to each segment based on a reasonable allocation methodology, when such costs are significant to the performance measures of the segments.

	Three Months Ended September 30, 2022
	Real estate services		Properties		Rentals		Mortgage		Other		Corporate Overhead and Intercompany Eliminations		Total
Revenue	$	211,540	$	299,663	$	38,686	$	48,469	$	7,079	$	(4,920)	$	600,517
Cost of revenue	156,632		332,251		8,676		43,783		6,018		(4,920)		542,440
Gross profit	54,908		(32,588)		30,010		4,686		1,061		—		58,077
Operating expenses
Technology and development	25,709		4,728		15,385		985		751		505		48,063
Marketing	18,772		506		12,678		1,653		48		91		33,748
General and administrative	20,244		3,029		22,722		7,073		784		7,153		61,005
Restructuring and reorganization	—		—		—		—		—		284		284
Total operating expenses	64,725		8,263		50,785		9,711		1,583		8,033		143,100
Loss from operations	(9,817)		(40,851)		(20,775)		(5,025)		(522)		(8,033)		(85,023)
Interest income, interest expense, income tax expense, and other expense, net	—		(2,814)		397		(129)		40		(2,716)		(5,222)
Net loss	$	(9,817)	$	(43,665)	$	(20,378)	$	(5,154)	$	(482)	$	(10,749)	$	(90,245)

	Three Months Ended September 30, 2021
	Real estate services		Properties		Rentals		Mortgage		Other		Corporate Overhead and Intercompany Eliminations		Total
Revenue	$	257,795	$	238,417	$	40,406	$	5,013	$	3,193	$	(4,750)	$	540,074
Cost of revenue	161,449		238,397		7,395		6,705		3,576		(4,750)		412,772
Gross profit	96,346		20		33,011		(1,692)		(383)		—		127,302
Operating expenses
Technology and development	20,732		3,602		13,849		2,910		586		1,979		43,658
Marketing	33,894		645		14,113		149		42		300		49,143
General and administrative	18,383		2,258		23,264		2,334		533		7,623		54,395
Total operating expenses	73,009		6,505		51,226		5,393		1,161		9,902		147,196
Income (loss) from operations	23,337		(6,485)		(18,215)		(7,085)		(1,544)		(9,902)		(19,894)
Interest income, interest expense, income tax expense, and other expense, net	(56)		(1,456)		311		1		1		2,144		945
Net income (loss)	$	23,281	$	(7,941)	$	(17,904)	$	(7,084)	$	(1,543)	$	(7,758)	$	(18,949)

	Nine Months Ended September 30, 2022
	Real estate services		Properties		Rentals		Mortgage		Other		Corporate Overhead and Intercompany Eliminations		Total
Revenue	$	640,835	$	942,022	$	114,979	$	104,484	$	17,341	$	(14,883)	$	1,804,778
Cost of revenue	488,114		946,955		23,769		95,616		16,590		(14,883)		1,556,161
Gross profit	152,721		(4,933)		91,210		8,868		751		—		248,617
Operating expenses
Technology and development	80,144		13,531		44,539		5,236		2,975		2,784		149,209
Marketing	90,380		2,480		36,806		3,525		173		468		133,832
General and administrative	67,578		9,064		68,738		18,047		2,346		25,931		191,704
Restructuring and reorganization	—		—		—		—		—		18,670		18,670
Total operating expenses	238,102		25,075		150,083		26,808		5,494		47,853		493,415
Loss from operations	(85,381)		(30,008)		(58,873)		(17,940)		(4,743)		(47,853)		(244,798)
Interest income, interest expense, income tax expense, and other expense, net	(123)		(5,682)		1,098		(164)		51		(9,579)		(14,399)
Net loss	$	(85,504)	$	(35,690)	$	(57,775)	$	(18,104)	$	(4,692)	$	(57,432)	$	(259,197)

	Nine Months Ended September 30, 2021
	Real estate services		Properties		Rentals		Mortgage		Other		Corporate Overhead and Intercompany Eliminations		Total
Revenue	$	678,602	$	503,588	$	82,954	$	15,823	$	10,261	$	(11,520)	$	1,279,708
Cost of revenue	453,790		496,948		14,965		19,406		10,323		(11,520)		983,912
Gross profit	224,812		6,640		67,989		(3,583)		(62)		—		295,796
Operating expenses
Technology and development	60,862		9,512		27,616		7,814		1,538		5,482		112,824
Marketing	86,823		1,423		26,724		413		105		855		116,343
General and administrative	60,813		6,765		46,413		5,686		1,466		30,209		151,352
Total operating expenses	208,498		17,700		100,753		13,913		3,109		36,546		380,519
Income (loss) from operations	16,314		(11,060)		(32,764)		(17,496)		(3,171)		(36,546)		(84,723)
Interest income, interest expense, income tax expense, and other expense, net	(87)		(2,538)		523		2		2		4,210		2,112
Net income (loss)	$	16,227	$	(13,598)	$	(32,241)	$	(17,494)	$	(3,169)	$	(32,336)	$	(82,611)