Segment Reporting and Revenue

6 Months Ended

Jun. 30, 2023

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 revenue and gross profit. 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 five operating segments and three reportable segments, real estate services, rentals, and mortgage. As a result of our decision to wind-down RedfinNow operations in November 2022, we report our properties segment as a discontinued operation as we completed wind-down of the business during the three months ended June 30, 2023.

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. Our key revenue components are brokerage revenue, partner revenue, rentals revenue, mortgage revenue, and other revenue.

Information on each of our reportable and other segments and reconciliation to net (loss) income from continuing operations is presented in the tables 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 June 30, 2023
	Real estate services		Rentals		Mortgage		Other		Corporate overhead		Total
Revenue(1)	$	180,641	$	45,356	$	38,426	$	11,133	$	—	$	275,556
Cost of revenue	124,447		10,427		34,266		6,226		—		175,366
Gross profit	56,194		34,929		4,160		4,907		—		100,190
Operating expenses
Technology and development	28,044		16,304		734		1,118		941		47,141
Marketing	16,004		15,938		1,054		16		21		33,033
General and administrative	20,961		25,305		6,724		1,044		7,731		61,765
Restructuring and reorganization	—		—		—		—		6,106		6,106
Total operating expenses	65,009		57,547		8,512		2,178		14,799		148,045
(Loss) income from continuing operations	(8,815)		(22,618)		(4,352)		2,729		(14,799)		(47,855)
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net	—		28		(91)		153		20,553		20,643
Net (loss) income from continuing operations	$	(8,815)	$	(22,590)	$	(4,443)	$	2,882	$	5,754	$	(27,212)

(1) Included in revenue is $95 from providing services to our discontinued properties segment.

	Three Months Ended June 30, 2022
	Real estate services		Rentals		Mortgage		Other		Corporate overhead		Total
Revenue(1)	$	251,809	$	38,248	$	53,098	$	5,894	$	—	$	349,049
Cost of revenue	177,698		7,901		46,316		5,898		—		237,813
Gross profit	74,111		30,347		6,782		(4)		—		111,236
Operating expenses
Technology and development	27,696		14,871		1,904		1,189		1,162		46,822
Marketing	40,765		13,086		1,843		71		157		55,922
General and administrative	24,341		21,824		9,450		850		12,058		68,523
Restructuring and reorganization	—		—		—		—		12,406		12,406
Total operating expenses	92,802		49,781		13,197		2,110		25,783		183,673
Loss from continuing operations	(18,691)		(19,434)		(6,415)		(2,114)		(25,783)		(72,437)
Interest income, interest expense, income tax expense, and other expense, net	(123)		232		(35)		11		(2,171)		(2,086)
Net loss from continuing operations	$	(18,814)	$	(19,202)	$	(6,450)	$	(2,103)	$	(27,954)	$	(74,523)

(1) Included in revenue is $4,740 from providing services to our discontinued properties segment.

	Six Months Ended June 30, 2023
	Real estate services		Rentals		Mortgage		Other		Corporate overhead		Total
Revenue(1)	$	307,937	$	88,226	$	74,915	$	18,561	$	—	$	489,639
Cost of revenue	235,941		20,192		63,479		11,699		—		331,311
Gross profit	71,996		68,034		11,436		6,862		—		158,328
Operating expenses
Technology and development	56,939		32,268		1,377		2,342		1,878		94,804
Marketing	41,064		30,264		2,034		26		48		73,436
General and administrative	40,579		51,607		13,653		2,097		23,268		131,204
Restructuring and reorganization	—		—		—		—		7,159		7,159
Total operating expenses	138,582		114,139		17,064		4,465		32,353		306,603
(Loss) income from continuing operations	(66,586)		(46,105)		(5,628)		2,397		(32,353)		(148,275)
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net	—		73		(151)		268		63,563		63,753
Net (loss) income from continuing operations	$	(66,586)	$	(46,032)	$	(5,779)	$	2,665	$	31,210	$	(84,522)

(1) Included in revenue is $1,244 from providing services to our discontinued properties segment.

	Six Months Ended June 30, 2022
	Real estate services		Rentals		Mortgage		Other		Corporate overhead		Total
Revenue(1)	$	429,295	$	76,292	$	56,015	$	10,263	$	—	$	571,865
Cost of revenue	331,482		15,094		51,834		10,570		—		408,980
Gross profit	97,813		61,198		4,181		(307)		—		162,885
Operating expenses
Technology and development	54,435		29,154		4,251		2,225		2,278		92,343
Marketing	71,608		24,128		1,871		125		379		98,111
General and administrative	47,333		46,015		10,974		1,562		18,780		124,664
Restructuring and reorganization	—		—		—		—		18,115		18,115
Total operating expenses	173,376		99,297		17,096		3,912		39,552		333,233
Loss from continuing operations	(75,563)		(38,099)		(12,915)		(4,219)		(39,552)		(170,348)
Interest income, interest expense, income tax expense, gain on extinguishment of convertible senior notes, and other expense, net	(123)		701		(35)		12		(6,678)		(6,123)
Net loss from continuing operations	$	(75,686)	$	(37,398)	$	(12,950)	$	(4,207)	$	(46,230)	$	(176,471)

(1) Included in revenue is $9,963 from providing services to our discontinued properties segment.