00013828212023FYfalseP3YP3YP1Yhttp://fasb.org/us-gaap/2023#OtherAssetsCurrentP2Y00013828212023-01-012023-12-3100013828212023-06-30iso4217:USD00013828212024-02-21xbrli:shares00013828212023-12-3100013828212022-12-31iso4217:USDxbrli:shares00013828212022-01-012022-12-3100013828212021-01-012021-12-3100013828212021-12-3100013828212020-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2023-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2022-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2021-12-310001382821us-gaap:PreferredStockMember2020-12-310001382821us-gaap:CommonStockMember2020-12-310001382821us-gaap:AdditionalPaidInCapitalMember2020-12-310001382821us-gaap:RetainedEarningsMember2020-12-310001382821us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-310001382821us-gaap:PreferredStockMember2021-01-012021-12-310001382821us-gaap:CommonStockMember2021-01-012021-12-310001382821us-gaap:AdditionalPaidInCapitalMember2021-01-012021-12-310001382821us-gaap:AdditionalPaidInCapitalMembersrt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember2021-12-310001382821us-gaap:RetainedEarningsMembersrt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember2021-12-310001382821srt:RevisionOfPriorPeriodAccountingStandardsUpdateAdjustmentMember2021-12-310001382821us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-12-310001382821us-gaap:RetainedEarningsMember2021-01-012021-12-310001382821us-gaap:PreferredStockMember2021-12-310001382821us-gaap:CommonStockMember2021-12-310001382821us-gaap:AdditionalPaidInCapitalMember2021-12-310001382821us-gaap:RetainedEarningsMember2021-12-310001382821us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001382821us-gaap:PreferredStockMember2022-01-012022-12-310001382821us-gaap:CommonStockMember2022-01-012022-12-310001382821us-gaap:AdditionalPaidInCapitalMember2022-01-012022-12-310001382821us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-12-310001382821us-gaap:RetainedEarningsMember2022-01-012022-12-310001382821us-gaap:PreferredStockMember2022-12-310001382821us-gaap:CommonStockMember2022-12-310001382821us-gaap:AdditionalPaidInCapitalMember2022-12-310001382821us-gaap:RetainedEarningsMember2022-12-310001382821us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-310001382821us-gaap:PreferredStockMember2023-01-012023-12-310001382821us-gaap:CommonStockMember2023-01-012023-12-310001382821us-gaap:AdditionalPaidInCapitalMember2023-01-012023-12-310001382821us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-01-012023-12-310001382821us-gaap:RetainedEarningsMember2023-01-012023-12-310001382821us-gaap:PreferredStockMember2023-12-310001382821us-gaap:CommonStockMember2023-12-310001382821us-gaap:AdditionalPaidInCapitalMember2023-12-310001382821us-gaap:RetainedEarningsMember2023-12-310001382821us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-12-31rdfn:classOfReceivable0001382821srt:MinimumMember2023-12-310001382821srt:MaximumMember2023-12-310001382821us-gaap:ServiceLifeMember2023-01-012023-12-31rdfn:sublease0001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2023-01-012023-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2022-01-012022-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2021-01-012021-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:CostOfSalesMember2023-01-012023-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:CostOfSalesMember2022-01-012022-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:CostOfSalesMember2021-01-012021-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:ResearchAndDevelopmentExpenseMember2023-01-012023-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:ResearchAndDevelopmentExpenseMember2022-01-012022-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:ResearchAndDevelopmentExpenseMember2021-01-012021-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:SellingAndMarketingExpenseMember2023-01-012023-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:SellingAndMarketingExpenseMember2022-01-012022-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:SellingAndMarketingExpenseMember2021-01-012021-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:GeneralAndAdministrativeExpenseMember2023-01-012023-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-12-310001382821us-gaap:SegmentDiscontinuedOperationsMemberus-gaap:GeneralAndAdministrativeExpenseMember2021-01-012021-12-310001382821us-gaap:SegmentDiscontinuedOperationsMember2023-01-012023-12-310001382821us-gaap:SegmentDiscontinuedOperationsMember2022-01-012022-12-310001382821us-gaap:SegmentDiscontinuedOperationsMember2021-01-012021-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMemberus-gaap:EmployeeSeveranceMember2023-01-012023-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMemberus-gaap:EmployeeSeveranceMember2023-12-310001382821rdfn:AssetWriteOffsMemberus-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2023-01-012023-12-310001382821rdfn:AssetWriteOffsMemberus-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2023-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberus-gaap:OtherRestructuringMemberrdfn:PropertiesSegmentMember2023-01-012023-12-310001382821us-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberus-gaap:OtherRestructuringMemberrdfn:PropertiesSegmentMember2023-12-310001382821rdfn:AcceleratedAmortizationOfDebtIssuanceCostsMemberus-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2023-01-012023-12-310001382821rdfn:AcceleratedAmortizationOfDebtIssuanceCostsMemberus-gaap:DiscontinuedOperationsDisposedOfByMeansOtherThanSaleMemberrdfn:PropertiesSegmentMember2023-12-31rdfn:segment0001382821us-gaap:OperatingSegmentsMemberrdfn:RealEstateSegmentMember2023-01-012023-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:RentalsSegmentMember2023-01-012023-12-310001382821rdfn:MortgageSegmentsMemberus-gaap:OperatingSegmentsMember2023-01-012023-12-310001382821us-gaap:CorporateNonSegmentMember2023-01-012023-12-310001382821us-gaap:IntersegmentEliminationMember2023-01-012023-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:DiscontinuedPropertiesSegmentMember2023-01-012023-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:RealEstateSegmentMember2022-01-012022-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:RentalsSegmentMember2022-01-012022-12-310001382821rdfn:MortgageSegmentsMemberus-gaap:OperatingSegmentsMember2022-01-012022-12-310001382821us-gaap:CorporateNonSegmentMember2022-01-012022-12-310001382821us-gaap:IntersegmentEliminationMember2022-01-012022-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:DiscontinuedPropertiesSegmentMember2022-01-012022-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:RealEstateSegmentMember2021-01-012021-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:RentalsSegmentMember2021-01-012021-12-310001382821rdfn:MortgageSegmentsMemberus-gaap:OperatingSegmentsMember2021-01-012021-12-310001382821us-gaap:CorporateNonSegmentMember2021-01-012021-12-310001382821us-gaap:IntersegmentEliminationMember2021-01-012021-12-310001382821us-gaap:OperatingSegmentsMemberrdfn:DiscontinuedPropertiesSegmentMember2021-01-012021-12-310001382821us-gaap:ForwardContractsMember2023-12-310001382821us-gaap:ForwardContractsMember2022-12-310001382821us-gaap:InterestRateLockCommitmentsMember2023-12-310001382821us-gaap:InterestRateLockCommitmentsMember2022-12-310001382821us-gaap:ForwardContractsMember2023-01-012023-12-310001382821us-gaap:ForwardContractsMember2022-01-012022-12-310001382821us-gaap:ForwardContractsMember2021-01-012021-12-310001382821us-gaap:InterestRateLockCommitmentsMember2023-01-012023-12-310001382821us-gaap:InterestRateLockCommitmentsMember2022-01-012022-12-310001382821us-gaap:InterestRateLockCommitmentsMember2021-01-012021-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MoneyMarketFundsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:USTreasurySecuritiesMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:USTreasurySecuritiesMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:USTreasurySecuritiesMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberrdfn:AgencyBondsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberrdfn:AgencyBondsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberrdfn:AgencyBondsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberrdfn:AgencyBondsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueInputsLevel1Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateLockCommitmentsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateLockCommitmentsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMemberus-gaap:FairValueInputsLevel1Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMemberus-gaap:FairValueInputsLevel2Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMemberus-gaap:FairValueInputsLevel3Member2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:MoneyMarketFundsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberus-gaap:MoneyMarketFundsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:MoneyMarketFundsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:MoneyMarketFundsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:USTreasurySecuritiesMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:USTreasurySecuritiesMemberus-gaap:FairValueInputsLevel1Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:USTreasurySecuritiesMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:USTreasurySecuritiesMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberrdfn:AgencyBondsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberrdfn:AgencyBondsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberrdfn:AgencyBondsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberrdfn:AgencyBondsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:EquitySecuritiesMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel1Memberus-gaap:EquitySecuritiesMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:EquitySecuritiesMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EquitySecuritiesMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMemberus-gaap:FairValueInputsLevel1Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMemberus-gaap:FairValueInputsLevel2Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:ForwardContractsMemberus-gaap:FairValueInputsLevel3Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:InterestRateLockCommitmentsMemberus-gaap:FairValueInputsLevel1Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel2Memberus-gaap:InterestRateLockCommitmentsMember2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:FairValueInputsLevel3Memberus-gaap:InterestRateLockCommitmentsMember2022-12-310001382821rdfn:MarketingpricingMemberrdfn:MeasurementInputPullThroughRateMembersrt:MinimumMemberus-gaap:InterestRateLockCommitmentsMember2023-12-31xbrli:pure0001382821rdfn:MarketingpricingMemberrdfn:MeasurementInputPullThroughRateMembersrt:MaximumMemberus-gaap:InterestRateLockCommitmentsMember2023-12-310001382821rdfn:MarketingpricingMemberrdfn:MeasurementInputPullThroughRateMemberus-gaap:InterestRateLockCommitmentsMember2023-12-310001382821rdfn:MarketingpricingMemberrdfn:MeasurementInputPullThroughRateMembersrt:MinimumMemberus-gaap:InterestRateLockCommitmentsMember2022-12-310001382821rdfn:MarketingpricingMemberrdfn:MeasurementInputPullThroughRateMembersrt:MaximumMemberus-gaap:InterestRateLockCommitmentsMember2022-12-310001382821rdfn:MarketingpricingMemberrdfn:MeasurementInputPullThroughRateMemberus-gaap:InterestRateLockCommitmentsMember2022-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MinimumMemberus-gaap:MeasurementInputPrepaymentRateMember2023-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MaximumMemberus-gaap:MeasurementInputPrepaymentRateMember2023-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMember2023-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MinimumMemberus-gaap:MeasurementInputPrepaymentRateMember2022-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MaximumMemberus-gaap:MeasurementInputPrepaymentRateMember2022-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputPrepaymentRateMember2022-12-310001382821us-gaap:MeasurementInputDefaultRateMemberus-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MinimumMember2023-12-310001382821us-gaap:MeasurementInputDefaultRateMemberus-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MaximumMember2023-12-310001382821us-gaap:MeasurementInputDefaultRateMemberus-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMember2023-12-310001382821us-gaap:MeasurementInputDefaultRateMemberus-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MinimumMember2022-12-310001382821us-gaap:MeasurementInputDefaultRateMemberus-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMembersrt:MaximumMember2022-12-310001382821us-gaap:MeasurementInputDefaultRateMemberus-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMember2022-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMembersrt:MinimumMember2023-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2023-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMember2023-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMembersrt:MinimumMember2022-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMembersrt:MaximumMember2022-12-310001382821us-gaap:ValuationTechniqueDiscountedCashFlowMemberrdfn:MortgageServicingRightsMemberus-gaap:MeasurementInputDiscountRateMember2022-12-310001382821us-gaap:InterestRateLockCommitmentsMember2021-12-310001382821us-gaap:InterestRateLockCommitmentsMember2020-12-310001382821rdfn:MortgageServicingRightsMember2022-12-310001382821rdfn:MortgageServicingRightsMember2021-12-310001382821rdfn:MortgageServicingRightsMember2020-12-310001382821rdfn:MortgageServicingRightsMember2023-01-012023-12-310001382821rdfn:MortgageServicingRightsMember2022-01-012022-12-310001382821rdfn:MortgageServicingRightsMember2021-01-012021-12-310001382821rdfn:MortgageServicingRightsMember2023-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Member2023-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Member2022-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Member2023-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Member2022-12-310001382821rdfn:A05ConvertibleSeniorNotesDue2027Member2023-12-310001382821rdfn:A05ConvertibleSeniorNotesDue2027Member2022-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CashMember2023-12-310001382821us-gaap:FairValueMeasurementsRecurringMemberus-gaap:CashMember2022-12-310001382821us-gaap:LeaseholdImprovementsMember2023-12-310001382821us-gaap:LeaseholdImprovementsMember2022-12-310001382821srt:MinimumMemberus-gaap:SoftwareDevelopmentMember2023-12-310001382821srt:MaximumMemberus-gaap:SoftwareDevelopmentMember2023-12-310001382821us-gaap:SoftwareDevelopmentMember2023-12-310001382821us-gaap:SoftwareDevelopmentMember2022-12-310001382821srt:MinimumMemberus-gaap:OfficeEquipmentMember2023-12-310001382821srt:MaximumMemberus-gaap:OfficeEquipmentMember2023-12-310001382821us-gaap:OfficeEquipmentMember2023-12-310001382821us-gaap:OfficeEquipmentMember2022-12-310001382821rdfn:SoftwareMember2023-12-310001382821rdfn:SoftwareMember2022-12-310001382821us-gaap:FurnitureAndFixturesMember2023-12-310001382821us-gaap:FurnitureAndFixturesMember2022-12-310001382821rdfn:PropertyPlantAndEquipmentGrossExcludingConstructionInProgressMember2023-12-310001382821rdfn:PropertyPlantAndEquipmentGrossExcludingConstructionInProgressMember2022-12-310001382821us-gaap:ConstructionInProgressMember2023-12-310001382821us-gaap:ConstructionInProgressMember2022-12-310001382821us-gaap:CostOfSalesMember2023-01-012023-12-310001382821us-gaap:CostOfSalesMember2022-01-012022-12-310001382821us-gaap:OperatingExpenseMember2023-01-012023-12-310001382821us-gaap:OperatingExpenseMember2022-01-012022-12-310001382821srt:ScenarioForecastMember2024-01-012024-12-3100013828212020-05-112020-05-11rdfn:patent00013828212022-05-232022-05-230001382821rdfn:PurchaseCommitmentsMember2023-12-310001382821us-gaap:TradeNamesMember2023-12-310001382821us-gaap:TradeNamesMember2022-12-310001382821us-gaap:DevelopedTechnologyRightsMember2023-12-310001382821us-gaap:DevelopedTechnologyRightsMember2022-12-310001382821us-gaap:CustomerRelationshipsMember2023-12-310001382821us-gaap:CustomerRelationshipsMember2022-12-310001382821rdfn:RealEstateServicesSegmentMember2023-12-310001382821rdfn:RentalsSegmentMember2023-12-310001382821rdfn:MortgageSegmentsMember2023-12-310001382821us-gaap:CommonStockMember2020-04-012020-04-010001382821us-gaap:CommonStockMember2020-04-010001382821us-gaap:PreferredStockMember2020-04-012020-04-010001382821us-gaap:PreferredStockMember2020-04-0100013828212020-04-012020-04-0100013828212020-04-01utr:D0001382821us-gaap:EmployeeStockMemberrdfn:A2004EquityIncentivePlanMember2023-12-310001382821rdfn:A2004EquityIncentivePlanMember2023-01-012023-12-310001382821rdfn:A2017EquityIncentivePlanMember2017-07-260001382821rdfn:A2017EquityIncentivePlanMember2023-01-012023-12-310001382821rdfn:A2017EquityIncentivePlanMembersrt:MinimumMember2023-01-012023-12-310001382821rdfn:A2017EquityIncentivePlanMembersrt:MaximumMember2023-01-012023-12-310001382821rdfn:A2017EquityIncentivePlanMember2023-12-310001382821rdfn:A2017EquityIncentivePlanMember2022-12-310001382821us-gaap:EmployeeStockMemberrdfn:A2017EmployeeStockPurchasePlanMember2017-07-270001382821us-gaap:EmployeeStockMemberrdfn:A2017EmployeeStockPurchasePlanMember2023-01-012023-12-310001382821rdfn:A2017EmployeeStockPurchasePlanMember2023-12-310001382821rdfn:A2017EmployeeStockPurchasePlanMember2022-12-310001382821us-gaap:EmployeeStockMemberrdfn:A2017EmployeeStockPurchasePlanMember2022-07-012022-07-010001382821us-gaap:EmployeeStockMemberrdfn:A2017EmployeeStockPurchasePlanMember2022-01-012022-01-010001382821us-gaap:RestrictedStockUnitsRSUMember2022-12-310001382821us-gaap:RestrictedStockUnitsRSUMember2023-01-012023-12-310001382821us-gaap:RestrictedStockUnitsRSUMember2023-12-310001382821us-gaap:PerformanceSharesMember2023-12-310001382821us-gaap:PerformanceSharesMember2023-01-012023-12-310001382821srt:MinimumMemberus-gaap:PerformanceSharesMember2023-01-012023-12-310001382821srt:MaximumMemberus-gaap:PerformanceSharesMember2023-01-012023-12-310001382821rdfn:CurrentPeriodMemberus-gaap:PerformanceSharesMember2023-01-012023-12-310001382821rdfn:CurrentPeriodMemberus-gaap:PerformanceSharesMember2022-01-012022-12-310001382821rdfn:CurrentPeriodMemberus-gaap:PerformanceSharesMember2021-01-012021-12-310001382821rdfn:PriorPeriodsMemberus-gaap:PerformanceSharesMember2023-01-012023-12-310001382821rdfn:PriorPeriodsMemberus-gaap:PerformanceSharesMember2022-01-012022-12-310001382821rdfn:PriorPeriodsMemberus-gaap:PerformanceSharesMember2021-01-012021-12-310001382821us-gaap:PerformanceSharesMember2022-01-012022-12-310001382821us-gaap:PerformanceSharesMember2021-01-012021-12-310001382821us-gaap:CostOfSalesMember2021-01-012021-12-310001382821us-gaap:ResearchAndDevelopmentExpenseMember2023-01-012023-12-310001382821us-gaap:ResearchAndDevelopmentExpenseMember2022-01-012022-12-310001382821us-gaap:ResearchAndDevelopmentExpenseMember2021-01-012021-12-310001382821us-gaap:SellingAndMarketingExpenseMember2023-01-012023-12-310001382821us-gaap:SellingAndMarketingExpenseMember2022-01-012022-12-310001382821us-gaap:SellingAndMarketingExpenseMember2021-01-012021-12-310001382821us-gaap:GeneralAndAdministrativeExpenseMember2023-01-012023-12-310001382821us-gaap:GeneralAndAdministrativeExpenseMember2022-01-012022-12-310001382821us-gaap:GeneralAndAdministrativeExpenseMember2021-01-012021-12-310001382821us-gaap:SegmentContinuingOperationsMember2023-01-012023-12-310001382821us-gaap:SegmentContinuingOperationsMember2022-01-012022-12-310001382821us-gaap:SegmentContinuingOperationsMember2021-01-012021-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Memberus-gaap:ConvertibleDebtMember2023-01-012023-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Memberus-gaap:ConvertibleDebtMember2022-01-012022-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Memberus-gaap:ConvertibleDebtMember2021-01-012021-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:ConvertibleDebtMember2023-01-012023-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:ConvertibleDebtMember2022-01-012022-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:ConvertibleDebtMember2021-01-012021-12-310001382821us-gaap:ConvertibleDebtMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2023-01-012023-12-310001382821us-gaap:ConvertibleDebtMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2022-01-012022-12-310001382821us-gaap:ConvertibleDebtMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2021-01-012021-12-310001382821us-gaap:ConvertiblePreferredStockMember2023-01-012023-12-310001382821us-gaap:ConvertiblePreferredStockMember2022-01-012022-12-310001382821us-gaap:ConvertiblePreferredStockMember2021-01-012021-12-310001382821us-gaap:EmployeeStockOptionMember2023-01-012023-12-310001382821us-gaap:EmployeeStockOptionMember2022-01-012022-12-310001382821us-gaap:EmployeeStockOptionMember2021-01-012021-12-310001382821us-gaap:RestrictedStockUnitsRSUMember2023-01-012023-12-310001382821us-gaap:RestrictedStockUnitsRSUMember2022-01-012022-12-310001382821us-gaap:RestrictedStockUnitsRSUMember2021-01-012021-12-310001382821us-gaap:RestrictedStockUnitsRSUMemberrdfn:NonEmployeeDirectorsMember2023-01-012023-12-310001382821us-gaap:DomesticCountryMember2023-12-310001382821us-gaap:DomesticCountryMember2022-12-310001382821us-gaap:StateAndLocalJurisdictionMember2023-12-310001382821us-gaap:StateAndLocalJurisdictionMember2022-12-310001382821us-gaap:ForeignCountryMember2023-12-310001382821us-gaap:ForeignCountryMember2022-12-310001382821us-gaap:DomesticCountryMember2023-01-012023-12-310001382821us-gaap:ResearchMember2023-12-310001382821us-gaap:ResearchMember2022-12-310001382821us-gaap:DomesticCountryMember2022-01-012022-12-3100013828212017-03-310001382821us-gaap:ResearchMember2017-03-312017-03-310001382821us-gaap:DomesticCountryMember2021-01-012021-12-310001382821us-gaap:ForeignCountryMember2023-01-012023-12-310001382821us-gaap:ForeignCountryMember2022-01-012022-12-310001382821us-gaap:ForeignCountryMember2021-01-012021-12-310001382821rdfn:RentPathHoldingsIncMember2023-01-012023-12-310001382821rdfn:CityNationalBankMemberus-gaap:WarehouseAgreementBorrowingsMember2023-12-310001382821rdfn:OriginBankMemberus-gaap:WarehouseAgreementBorrowingsMember2023-12-310001382821us-gaap:WarehouseAgreementBorrowingsMemberrdfn:MTBankMember2023-12-310001382821us-gaap:WarehouseAgreementBorrowingsMemberrdfn:ProsperityBankMember2023-12-310001382821rdfn:RepublicBankTrustCompanyMemberus-gaap:WarehouseAgreementBorrowingsMember2023-12-310001382821us-gaap:WarehouseAgreementBorrowingsMemberrdfn:WellsFargoBankNAMember2023-12-310001382821us-gaap:SecuredDebtMemberrdfn:TermLoanMember2023-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMember2023-12-310001382821us-gaap:SeniorNotesMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2023-12-310001382821us-gaap:WarehouseAgreementBorrowingsMember2023-12-310001382821rdfn:CityNationalBankMemberus-gaap:WarehouseAgreementBorrowingsMember2022-12-310001382821us-gaap:WarehouseAgreementBorrowingsMemberrdfn:ComericaBankMember2022-12-310001382821rdfn:OriginBankMemberus-gaap:WarehouseAgreementBorrowingsMember2022-12-310001382821us-gaap:WarehouseAgreementBorrowingsMemberrdfn:MTBankMember2022-12-310001382821us-gaap:WarehouseAgreementBorrowingsMemberrdfn:ProsperityBankMember2022-12-310001382821rdfn:RepublicBankTrustCompanyMemberus-gaap:WarehouseAgreementBorrowingsMember2022-12-310001382821us-gaap:WarehouseAgreementBorrowingsMemberrdfn:WellsFargoBankNAMember2022-12-310001382821us-gaap:WarehouseAgreementBorrowingsMember2022-12-310001382821us-gaap:LineOfCreditMemberrdfn:FirstLienTermLoanFacilityMember2023-10-200001382821us-gaap:LineOfCreditMemberrdfn:FirstLienTermLoanFacilityMember2023-10-202023-10-200001382821rdfn:Period1Memberus-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMemberrdfn:FirstLienTermLoanFacilityMemberrdfn:SecuredOvernightFinancingRateSOFRMember2023-10-202023-10-200001382821us-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMemberrdfn:Period2Memberrdfn:FirstLienTermLoanFacilityMemberrdfn:SecuredOvernightFinancingRateSOFRMember2023-10-202023-10-200001382821us-gaap:LineOfCreditMemberus-gaap:RevolvingCreditFacilityMemberrdfn:Period3Memberrdfn:FirstLienTermLoanFacilityMemberrdfn:SecuredOvernightFinancingRateSOFRMember2023-10-202023-10-200001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:LineOfCreditMember2023-10-200001382821us-gaap:LineOfCreditMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2023-10-200001382821us-gaap:LineOfCreditMember2023-10-202023-10-200001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMember2023-01-012023-12-310001382821us-gaap:SeniorNotesMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2023-01-012023-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMember2020-10-200001382821us-gaap:SeniorNotesMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2021-04-050001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMemberrdfn:RepurchaseProgramMember2020-10-200001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMemberrdfn:RepurchaseProgramMember2020-10-202020-10-200001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberrdfn:RepurchaseInConjunctionWithApolloTermLoanMemberus-gaap:SeniorNotesMember2020-10-200001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberrdfn:RepurchaseInConjunctionWithApolloTermLoanMemberus-gaap:SeniorNotesMember2020-10-202020-10-200001382821rdfn:RepurchaseInConjunctionWithApolloTermLoanMemberus-gaap:SeniorNotesMemberrdfn:A0ConvertibleSeniorNotesDue2027Member2021-03-250001382821rdfn:RepurchaseInConjunctionWithApolloTermLoanMemberus-gaap:SeniorNotesMemberrdfn:A0ConvertibleSeniorNotesDue2027Member2021-03-252021-03-250001382821rdfn:RepurchaseInConjunctionWithApolloTermLoanMemberus-gaap:SeniorNotesMemberrdfn:A0ConvertibleSeniorNotesDue2027Member2020-10-202020-10-200001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Memberus-gaap:SeniorNotesMember2022-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMember2022-12-310001382821us-gaap:SeniorNotesMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2022-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Memberus-gaap:SeniorNotesMember2023-01-012023-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Memberus-gaap:SeniorNotesMember2022-01-012022-12-310001382821rdfn:A1.75ConvertibleSeniorNotesdue2023Memberus-gaap:SeniorNotesMember2021-01-012021-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMember2022-01-012022-12-310001382821rdfn:A0ConvertibleSeniorNotesDue2025Memberus-gaap:SeniorNotesMember2021-01-012021-12-310001382821us-gaap:SeniorNotesMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2022-01-012022-12-310001382821us-gaap:SeniorNotesMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2021-01-012021-12-310001382821us-gaap:SeniorNotesMember2023-01-012023-12-310001382821us-gaap:SeniorNotesMember2022-01-012022-12-310001382821us-gaap:SeniorNotesMember2021-01-012021-12-310001382821us-gaap:DebtInstrumentRedemptionPeriodOneMemberus-gaap:SeniorNotesMemberrdfn:ConvertibleSeniorNotesMember2023-01-012023-12-31rdfn:tradingDay0001382821us-gaap:SeniorNotesMemberus-gaap:DebtInstrumentRedemptionPeriodTwoMemberrdfn:ConvertibleSeniorNotesMember2023-01-012023-12-31rdfn:businessDay0001382821us-gaap:DebtInstrumentRedemptionPeriodTwoMember2023-01-012023-12-310001382821us-gaap:SeniorNotesMembersrt:MinimumMemberrdfn:CappedCallTransactionMemberrdfn:A05ConvertibleSeniorNotesDue2027Memberus-gaap:CallOptionMember2021-03-252021-03-250001382821us-gaap:SeniorNotesMembersrt:MaximumMemberrdfn:CappedCallTransactionMemberrdfn:A05ConvertibleSeniorNotesDue2027Memberus-gaap:CallOptionMember2021-03-252021-03-250001382821us-gaap:SeniorNotesMemberrdfn:A05ConvertibleSeniorNotesDue2027Member2021-03-252021-03-25

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, 2023
or

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)
Delaware74-3064240
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
1099 Stewart StreetSuite 600
SeattleWA98101
(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 classTrading SymbolName of each exchange on which registered
Common Stock, $0.001 par value per shareRDFNThe 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.
YesNo
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act.
YesNo
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.
YesNo
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).
YesNo

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 filerAccelerated filer
Non-accelerated filerSmaller 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).
YesNo

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 $1,353,672,542.

The registrant had 119,241,526 shares of common stock outstanding as of February 21, 2024.

DOCUMENTS INCORPORATED BY REFERENCE

The portions of the registrant's proxy statement to be filed in connection with the registrant’s 2023 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, 2023

Table of Contents
PART IPage
Item 1.
Item 1A.
Item 1B.
Item 1C.
Item 2.
Item 3.
Item 4.
PART II
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
Item 9C.
PART III
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
PART IV
Item 15.
Item 16.




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.

i

Table of Contents
PART I

Item 1. Business

Overview

We help people buy and sell homes. Representing customers in over 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 the 2.5% to 3% typically charged by traditional brokerages.

The results of our customer-first approach are clear. We:
helped customers buy or sell more than 559,000 homes worth more than $281 billion through 2023;
saved customers approximately $1.6 billion, when compared to a 2.5% commission, since our launch in 2006;
drew nearly 50 million monthly average visitors to our website and mobile application in 2023;
had customers buy and sell the same home with us at a 28% higher rate than competing brokerages;
had listings on the market for an average of less than 36 days during the twelve months ended March 1, 2023 compared to the industry average of 40 days, according to a study we commissioned; and, according to the same study, approximately 91% of Redfin listings sold within 90 days versus the industry average of approximately 77%.

To serve customers when our own agents can’t due to high demand or geographic limitations, we’ve developed partnerships with over 5,793 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 2023.

Title Forward offers title and settlement services. Title Forward has officially launched in 27 markets across nine states and the District of Columbia. These markets accounted for 54% of our brokerage's transactions in 2023.

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.

1

Table of Contents
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, our value-added digital marketing solutions, traffic generated through our websites and mobile applications, and the breadth of our broader marketing services.

Seasonality

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

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 2023 earned a median income that was more than two times as much as agents at competing brokerages. Also in 2023, 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 2023, 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.

As of December 31, 2023, we had 4,693 employees. For 2023, our average number of lead agents was 1,776. See "Key Business Metrics - Average Number of Lead Agents" under Item 7.
2

Table of Contents

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 53, has served as our chief executive officer since September 2005 and one of our directors since March 2006.
Bridget Frey, age 46, has been employed by us since June 2011 and has served as our chief technology officer since February 2015.
Anthony Kappus, age 43, 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 57, has served as our chief financial officer since June 2013.
Anna Stevens, age 50, 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 45, 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.

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").
3

Table of Contents
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;
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, 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 expenses associated with home ownership, including 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;
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;
4

Table of Contents
changed generational views on homeownership and generally decreased financial resources available for purchasing homes; and
war, terrorism, political uncertainty, 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, which is our largest segment by gross profit, 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, 2023, 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. 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.

5

Table of Contents
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 redesign homes, 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.

6

Table of Contents
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. A competitor or another industry participant could also create an alternative listings data service, 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.

7

Table of Contents
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, and traditional media, including TV, radio, and billboards.

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 compensation 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 base pay, 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.

8

Table of Contents
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.

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, 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.

9

Table of Contents
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.

The growth of Rent.'s business depends on its ability to attract property managers' advertising spending.

Rent.'s growth depends on advertising revenue generated primarily through property managers. Rent.'s ability to attract and retain advertisers may be adversely affected by any of the following factors:
Rent.’s ability to generate high, and growing, levels of traffic to its family of websites and mobile applications;
a prolonged period of high occupancy within rental properties, or continued increase of new units coming on the rental market, reducing the need for our advertising services;
a prolonged period of low occupancy, putting downward pressure on the marketing budgets and operating cash flows of our property manager customers;
declining quantity and quality of renter leads it provides to property managers;
its inability to keep pace with changes in technology and features expected by renters when visiting an online rental portal;
its failure to offer an attractive return on investment to advertisers;
the inability of property managers to evict tenants for delinquent rent payments; and
increased property manager operating costs may impact their ability to pay for our services.

Rent. does not have long-term contracts with many of its advertisers, and these advertisers may choose to end their relationships with Rent. with little or no advance notice. As Rent.'s existing subscriptions for advertising terminate, it may not be successful in securing new subscriptions.

10

Table of Contents
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 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.

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 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 occur to 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 and employees) 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.

11

Table of Contents
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.

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.

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.

12

Table of Contents
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.

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 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 ordinary-course brokerage disputes, including, but not limited to, failure to disclose property defects, failure to meet client legal obligations, 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 and third-party contractor agents. See Note 8 to our consolidated financial statements for a discussion of pending third-party claims that we believe may be material to us.

13

Table of Contents
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 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.

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 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 is 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. Subsequently, Redfin has been named as one of several defendants in similar class action suits as described under the caption “Class Act Complaint” above under Item 1. Legal Proceedings.

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.

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 the question of whether the earlier settlement forecloses further investigation is currently being litigated. 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 settlement that may result therefrom.

Beyond monetary damages, the various class action suits seek to change real estate industry practices and, along with the DOJ investigation, have prompted state and local real estate boards or multiple listing services to discuss and consider changes to long-established rules and regulations. To the extent adopted, such amended rules and regulations may require changes to our business model, including changes to agent and broker compensation. Even if commission sharing remains the norm, it may no longer be mandated, which may lead to the introduction of hourly or a la carte services. If buyers end up having to compensate their brokers, they may be more likely to contact listing agents directly, driving down dual agent broker commissions. Home lending rules and norms do not currently allow for homebuyers to include buyer’s agent compensation in the balance of a home loan, which may impair the ability of homebuyers to pay buyers’ agent fees when purchasing a home. Such potential changes in the model for agent and broker compensation could reduce the fees we receive from our agents and, in turn, adversely affect our financial condition and results of operations.
14

Table of Contents

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.

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;
15

Table of Contents
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 $193.4 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.

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.

16

Table of Contents
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.

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.
17

Table of Contents

Risks Related to Our Convertible Preferred Stock

We may be required to make cash payments to our preferred stockholders before our preferred stock's final redemption date of November 30, 2024, and any cash payments may materially reduce our net working capital.

On November 30, 2024, we will be required to redeem all shares of our convertible preferred stock then outstanding and pay accrued dividends on those shares. A preferred stockholder has the option of receiving cash, shares of our common stock, or a combination of cash and shares for this redemption. However, before this redemption, we may be required to make cash payments to our preferred stockholders in the two situations described below, and any such cash payments will reduce our cash available for other corporate uses and may materially reduce our net working capital.

Dividends accrue on each $1,000 of our outstanding convertible preferred stock at a rate of 5.5% per year and are payable quarterly. Assuming we satisfy the "equity conditions" (as defined in the certificate of designation governing our preferred stock), we will pay dividends in shares of our common stock. These conditions principally include (i) we have ensured the liquidity and transferability of our common stock held by the preferred stockholders, (ii) we have issued common stock and paid cash to the preferred stockholders, as required by the certificate of designation, (iii) we are not in bankruptcy or have had a bankruptcy proceeding instituted against us, and (iv) we have not breached an agreement that governs the preferred stockholders' rights with respect to the preferred stock and such breach materially and adversely impacts our business or a preferred stockholder's economic benefits under the agreement. However, if we fail to satisfy these "equity conditions," then we must pay cash dividends in amount equal to (i) the number of shares of our common stock that we would have issued as dividends, assuming we satisfied the conditions, multiplied by (ii) the volume-weighted-average closing price of our common stock for the ten trading days preceding the date the dividends are payable.

A preferred stockholder has the right to require us to redeem its preferred stock for cash following the occurrence of a "triggering event" (as defined in the certificate of designation governing our preferred stock). These events are similar in nature to the "equity conditions" described above. The cash payment, for each share of preferred stock, would equal the sum of (i) $1,000, (ii) any accrued dividends on the preferred stock, and (iii) an amount equal to all scheduled dividend payments (excluding any accrued dividends) on the preferred stock for all remaining dividend periods from the date the preferred stockholder requests redemption through November 29, 2024.

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.

18

Table of Contents
Item 1B. Unresolved Staff Comments

None.

19

Table of Contents
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 is involved in direct oversight of 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.

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 by management 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.

20

Table of Contents
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 functionality, access controls, and threat detection systems including posture management tooling. We ensure the ongoing security and improves these technical safeguards through regular security reviews of components, code, libraries, and environments.

Incident Response and Recovery Planning—We have established and 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. The results of such assessments, audits and reviews are reported 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, including any previous cybersecurity incidents, that have materially affected or are reasonably likely to affect our business, including our business strategy, results of operations or financial condition.

21

Table of Contents
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.

22

Table of Contents
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 21, 2024, we had 202 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, 2023.

Item 5 graph.jpg

23

Table of Contents
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.

Purchases of Equity Securities

During the quarter ended December 31, 2023, 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.

Item 6. [Reserved]

Not applicable.
24

Table of Contents
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

We help people buy and sell homes. Representing customers in over 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.

Adverse Macroeconomic Conditions and Our Associated Actions

Beginning in the second quarter of 2022 and continuing through the fourth quarter of 2023, 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 2023, through involuntary reductions and attrition, we reduced our total number of employees by 40%, including a reduction in lead agents of 40%. 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.
25

Table of Contents
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,
202320222021
Monthly average visitors (in thousands)49,479 49,654 47,113 
Real estate services transactions
Brokerage47,244 66,554 76,680 
Partner14,676 13,649 17,899 
Total61,920 80,203 94,579 
Real estate services revenue per transaction
Brokerage$12,260 $11,269 $11,076 
Partner2,681 2,718 3,020 
Aggregate9,990 9,814 9,551 
U.S. market share by units(1)
0.76 %0.80 %0.77 %
Revenue from top-10 markets as a percentage of real estate services revenue55 %58 %62 %
Average number of lead agents1,776 2,426 2,396 
Mortgage originations by dollars (in millions)$4,268 $4,317 $988 
Mortgage originations by units (in ones)10,654 10,625 2,643 
(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.

26

Table of Contents
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 our commission refund 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 has 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.

From 2022 to 2023, the percentage of brokerage transactions from home sellers was essentially unchanged at approximately 43%.

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.

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.

27

Table of Contents
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.

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. 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.
28

Table of Contents

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.

Other Revenue

Other Revenue—Other services revenue includes fees earned from title settlement services, Walk Score data services, and advertising. Substantially all fees and revenue from other 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.

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 expenses primarily consist of personnel-related costs associated with employee terminations, furloughs, or retention payments associated with wind-down activities.

29

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

Income tax expense primarily relates to current state income taxes recorded for the year, partially offset by a deferred income tax benefit generated by the reduction to a deferred tax liability created through our April 2, 2021 acquisition of Rent.

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) Income, Net

Other (expense) income, net consists primarily of realized and unrealized gains and losses on investments and other assets, including impairment costs on our subleases. See Note 4 to our consolidated financial statements for information regarding unrealized losses on our investments.

30

Table of Contents
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,
202320222021
(in thousands)
Revenue$976,672 $1,099,574 $1,058,638 
Cost of revenue(1)
646,853 790,455 665,419 
Gross profit329,819 309,119 393,219 
Operating expenses:
Technology and development(1)
183,294 178,924 143,481 
Marketing(1)
117,863 155,309 136,851 
General and administrative(1)
238,790 243,390 208,722 
Restructuring and reorganization7,927 32,353 — 
Total operating expenses547,874 609,976 489,054 
Loss from continuing operations(218,055)(300,857)(95,835)
Interest income10,532 6,639 635 
Interest expense(9,524)(8,886)(7,491)
Income tax (expense) benefit(979)(116)6,107 
Gain on extinguishment of convertible senior notes94,019 57,193 — 
Other (expense) income, net(2,385)(3,770)5,360 
Net loss from continuing operations$(126,392)$(249,797)$(91,224)
(1) Includes stock-based compensation as follows:
Year Ended December 31,
202320222021
(in thousands)
Cost of revenue$12,914$15,137$12,388
Technology and development33,11126,36521,172
Marketing5,1483,9912,142
General and administrative19,52817,52613,843
Total$70,701$63,019$49,545

31

Table of Contents
Year Ended December 31,
202320222021
(as a percentage of revenue)
Revenue100.0 %100.0 %100.0 %
Cost of revenue(1)
66.2 71.9 62.9 
Gross profit33.8 28.1 37.1 
Operating expenses:
Technology and development(1)
18.8 16.3 13.6 
Marketing(1)
12.1 14.1 12.9 
General and administrative(1)
24.4 22.1 19.7 
Restructuring and reorganization0.8 2.9 — 
Total operating expenses
56.1 55.4 46.2 
Loss from continuing operations(22.3)(27.3)(9.1)
Interest income1.1 0.6 0.1 
Interest expense(1.0)(0.8)(0.7)
Income tax (expense) benefit
(0.1)— 0.6 
Gain on extinguishment of convertible senior notes9.6 5.2 — 
Other (expense) income, net(0.2)(0.3)0.5 
Net loss from continuing operations(12.9)%(22.6)%(8.6)%
(1) Includes stock-based compensation as follows:
Year Ended December 31,
202320222021
(as a percentage of revenue)
Cost of revenue1.3 %1.4 %1.2 %
Technology and development3.4 2.4 2.0 
Marketing0.5 0.4 0.2 
General and administrative2.0 1.6 1.3 
Total7.2 %5.8 %4.7 %

Comparison of the Years Ended December 31, 2023 and 2022

Revenue
Year Ended December 31,
Change
20232022DollarsPercentage
(in thousands, except percentages)
Real estate services
Brokerage$579,226 $749,985 $(170,759)(23)%
Partner39,351 37,091 2,260 
Total real estate services618,577 787,076 (168,499)(21)
Rentals184,812 155,910 28,902 19 
Mortgage134,108 132,904 1,204 
Other39,175 23,684 15,491 65 
Total revenue
$976,672 $1,099,574 $(122,902)(11)
Percentage of revenue
Real estate services
Brokerage59.3 %68.2 %
Partner4.0 3.4 
Total real estate services63.3 71.6 
Rentals18.9 14.2 
Mortgage13.7 12.1 
Other4.1 2.1 
Total revenue
100.0 %100.0 %

32

Table of Contents
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.

Cost of Revenue and Gross Margin
Year Ended December 31,
Change
20232022DollarsPercentage
(in thousands, except percentages)
Cost of revenue
Real estate services$462,625 $608,027 $(145,402)(24)%
Rentals42,086 33,416 8,670 26 
Mortgage118,178 126,552 (8,374)(7)
Other23,964 22,460 1,504 
Total cost of revenue$646,853 $790,455 $(143,602)(18)
Gross profit
Real estate services$155,952 $179,049 $(23,097)(13)%
Rentals142,726 122,494 20,232 17 
Mortgage15,930 6,352 9,578 151 
Other15,211 1,224 13,987 1,143 
Total gross profit$329,819 $309,119 $20,700 
Gross margin (percentage of revenue)
Real estate services25.2 %22.7 %
Rentals77.2 78.6 
Mortgage11.9 4.8 
Other38.8 5.2 
Total gross margin33.8 28.1 

In 2023, total cost of revenue decreased 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.

33

Table of Contents
In 2023, other gross margin increased by 3,360 basis points. This was primarily attributable to a 2,270 basis point decrease in personnel costs and transaction bonuses, and a 590 basis point decrease in production costs, each as a percentage of revenue.

Operating Expenses
Year Ended December 31,
Change
20232022DollarsPercentage
(in thousands, except percentages)
Technology and development$183,294 $178,924 $4,370 %
Marketing117,863 155,309 (37,446)(24)
General and administrative238,790 243,390 (4,600)(2)
Restructuring and reorganization7,927 32,353 (24,426)(75)
Total operating expenses$547,874 $609,976 $(62,102)(10)
Percentage of revenue
Technology and development18.8 %16.3 %
Marketing12.1 14.1 
General and administrative24.4 22.1 
Restructuring and reorganization0.8 2.9 
Total operating expenses56.1 %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.

34

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

Year Ended December 31,
Change
20232022DollarsPercentage
(in thousands, except percentages)
Interest income$10,532 $6,639 $3,893 59 %
Interest expense(9,524)(8,886)(638)
Income tax expense
(979)(116)(863)744 
Gain on extinguishment of convertible senior notes94,019 57,193 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 income1.1 %0.6 %
Interest expense(1.0)(0.8)
Income tax expense(0.1)— 
Gain on extinguishment of convertible senior notes9.6 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, net9.4 %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 with 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 increased 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.
35

Table of Contents
Comparison of the Years Ended December 31, 2022 and 2021

Revenue
Year Ended December 31,
Change
20222021DollarsPercentage
(in thousands, except percentages)
Real estate services
Brokerage$749,985 $849,288 $(99,303)(12)%
Partner37,091 54,046 (16,955)(31)
Total real estate services787,076 903,334 (116,258)(13)
Rentals155,910 121,877 34,033 28 
Mortgage132,904 19,818 113,086 571 
Other23,684 13,609 10,075 74 
Total revenue
$1,099,574 $1,058,638 $40,936 
Percentage of revenue
Real estate services
Brokerage68.2 %80.2 %
Partner3.4 5.1 
Total real estate services71.6 85.3 
Rentals14.2 11.5 
Mortgage 12.1 1.9 
Other 2.1 1.3 
Total revenue
100.0 %100.0 %

In 2022, revenue increased by $40.9 million, or 4%, as compared with 2021. Included in the increase was $155.9 million from our acquisition of Rent., and there was $121.9 million of such revenue in 2021. Also included in the increase was $130.2 million resulting from our acquisition of Bay Equity, and there was no such revenue in 2021. Excluding these revenues from Rent. and Bay Equity, revenue decreased by $123.3 million due to a $116.3 million decrease in real estate services revenue. Brokerage revenue decreased by $99.3 million and partner revenue decreased by $17.0 million. Brokerage revenue decreased 12% during the period, driven by a 13% decrease in brokerage transactions and partially offset by a 2% increase in brokerage revenue per transaction.

36

Table of Contents
Cost of Revenue and Gross Margin
Year Ended December 31,
Change
20222021DollarsPercentage
(in thousands, except percentages)
Cost of revenue
Real estate services$608,027 $603,320 $4,707 %
Rentals33,416 21,739 11,677 54 
Mortgage126,552 26,096 100,456 385 
Other22,460 14,264 8,196 57 
Total cost of revenue$790,455 $665,419 $125,036 19 
Gross profit
Real estate services$179,049 $300,014 $(120,965)(40)%
Rentals122,494 100,138 22,356 22 
Mortgage6,352 (6,278)12,630 (201)
Other1,224 (655)1,879 (287)
Total gross profit$309,119 $393,219 $(84,100)(21)
Gross margin (percentage of revenue)
Real estate services22.7 %33.2 %
Rentals78.6 82.2 
Mortgage4.8 (31.7)
Other5.2 (4.8)
Total gross margin28.1 37.1 

In 2022, total cost of revenue increased by $125.0 million, or 19%, as compared with 2021. Included in the increase was $33.4 million resulting from our acquisition of Rent., and there were $21.7 million of such expenses in 2021. Also included in the increase was $118.1 million resulting from our acquisition of Bay Equity, and there were no such expenses in 2021. Excluding these expenses from Rent. and Bay Equity, cost of revenue decreased by $4.8 million, primarily due to the shut-down of Redfin Mortgage.

Total gross margin decreased 900 basis points as compared with 2021, driven primarily by decreases in real estate services and rentals gross margin. This was partially offset by increases in mortgage and other gross margin.

In 2022, real estate services gross margin decreased 1,050 basis points as compared with 2021. This was primarily attributable to a 930 basis point increase in personnel costs and transaction bonuses as a percentage of revenue.

In 2022, rentals gross margin decreased by 360 basis points. This was primarily attributable to a 210 basis point increase in marketing expenses and a 210 basis point increase in personnel costs, each as a percentage of revenue and due to expanded services. This was partially offset by a 90 basis point reduction in outside services costs as a percentage of revenue.

In 2022, mortgage gross margin increased by 3,650 basis points. This was primarily attributable to a 3,160 basis point decrease in personnel costs and transaction bonuses as a percentage of revenue.

In 2022, other gross margin increased by 1,000 basis points. This was primarily attributable to a 470 basis point decrease in personnel costs and transaction bonuses as a percentage of revenue.

37

Table of Contents
Operating Expenses
Year Ended December 31,
Change
20222021DollarsPercentage
(in thousands, except percentages)
Technology and development$178,924 $143,481 $35,443 25 %
Marketing155,309 136,851 18,458 13 
General and administrative243,390 208,722 34,668 17 
Restructuring and reorganization32,353 — 32,353 N/A
Total operating expenses$609,976 $489,054 $120,922 25 
Percentage of revenue
Technology and development 16.3 %13.6 %
Marketing14.1 12.9 
General and administrative22.1 19.7 
Restructuring and reorganization2.9 0.0 
Total operating expenses55.4 %46.2 %

In 2022, technology and development expenses increased by $35.4 million, or 25%, as compared with 2021. Included in the increase was $52.3 million resulting from our acquisition of Rent., and there were $39.0 million such expenses in 2021. Also included in the increase was $1.8 million resulting from our acquisition of Bay Equity, and there were no such expenses in 2021. Excluding these expenses from Rent. and Bay Equity, technology and development expenses increased by $20.3 million. The increase was primarily attributable to a $12.5 million increase in personnel costs.

In 2022, marketing expenses increased by $18.5 million, or 13%, as compared with 2021. Included in the increase was $51.1 million resulting from our acquisition of Rent., and there were $36.1 million such expenses in 2021. Also included in the increase was $4.7 million resulting from our acquisition of Bay Equity, and there were no such expenses in 2021. Excluding these expenses from Rent. and Bay Equity, marketing expenses decreased by $1.2 million. The decrease was primarily attributable to a $2.1 million decrease in marketing media costs. This was partially offset by a $2.8 million increase in personnel costs.

In 2022, general and administrative expenses increased by $34.7 million, or 17%, as compared with 2021. Included in the increase was $90.8 million resulting from our acquisition of Rent., and there were $71.5 million in such expenses in 2021. Also included in the increase was $22.8 million resulting from our acquisition of Bay Equity, and there were no such expenses in 2021. Excluding these expenses from Rent. and Bay Equity, general and administrative expenses decreased by $7.5 million. The decrease was primarily attributable to a $7.3 million decrease in advertising campaign and contractor expenses for recruiting employees, and a $6.5 million decrease in acquisition transaction expenses. This was partially offset by a $4.2 million increase in internet-based services, and a $2.2 million increase in personnel costs due to increased headcount.

In 2022, restructuring and reorganization expenses increased by $32.4 million and there were no such expenses in 2021.

38

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

Year Ended December 31,
Change
20222021DollarsPercentage
(in thousands, except percentages)
Interest income$6,639 $635 $6,004 946 %
Interest expense(8,886)(7,491)(1,395)(19)
Income tax (expense) benefit
(116)6,107 (6,223)102 
Gain on extinguishment of convertible senior notes
57,193 — 57,193 N/A
Other (expense) income, net
(3,770)5,360 (9,130)(170)
Interest income, interest expense, income tax (expense) benefit, gain on extinguishment of convertible senior notes, and other (expense) income, net
$51,060 $4,611 $46,449 (1,007)
Percentage of revenue
Interest income0.6 %0.1 %
Interest expense(0.8)(0.7)
Income tax (expense) benefit0.0 0.6 
Gain on extinguishment of convertible senior notes
5.2 0.0 
Other (expense) income, net
(0.3)0.5 
Interest income, interest expense, income tax (expense) benefit, gain on extinguishment of convertible senior notes, and other (expense) income, net4.7 %0.5 %

In 2022, interest income, interest expense, income tax (expense) benefit, gain on extinguishment of convertible senior notes, and other (expense) income, net increased by $46.4 million as compared to the same period in 2021.

Interest income increased by $6.0 million primarily due to higher interest rates on our cash, cash equivalents, and investments compared with 2021.

Interest expense increased by $1.4 million primarily due to a full year of amortization for our 2027 notes as compared to a partial year in 2021, resulting in $0.5 million in additional expense in 2022.

Income tax (expense) benefit decreased by $6.2 million primarily due to a one-time income tax benefit from the Rent. acquisition in 2021, where no such benefit was recognized in 2022.

Gain on extinguishment of convertible senior notes increased by $57.2 million, due to our paying down a portion of our 2025 notes at a discount, where there was no such activity in 2021. See Note 14 to our consolidated financial statements for further information on these transactions.

In 2022, other income, net became other expense, net, a change of $9.1 million primarily due to (1) the fair value of one of our investments being recorded in 2021, where we did not have this recording during 2022, and the subsequent sale of that investment at a loss, (2) impairment of leases, and (3) losses on various property and equipment disposals.

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.

39

Table of Contents
Quarterly Results
Three Months Ended
Dec. 31, 2023Sep. 30, 2023Jun. 30, 2023Mar. 31, 2023Dec. 31, 2022Sep. 30, 2022Jun. 30, 2022Mar. 31, 2022
Revenue$218,077 $268,956 $275,556 $214,083 $221,935 $305,774 $349,049 $222,816 
Cost of revenue(1)
144,926 170,616 175,366 155,945 166,368 215,109 237,813 171,167 
Gross profit73,151 98,340 100,190 58,138 55,567 90,665 111,236 51,649 
Operating expenses:
Technology and development(1)
44,098 44,392 47,141 47,663 43,247 43,335 46,822 45,521 
Marketing(1)
20,332 24,095 33,033 40,403 23,956 33,242 55,922 42,189 
General and administrative(1)
52,206 55,380 61,765 69,439 60,751 57,976 68,523 56,141 
Restructuring and reorganization768 — 6,106 1,053 13,954 284 12,406 5,709 
Total117,404 123,867 148,045 158,558 141,908 134,837 183,673 149,560 
Loss from continuing operations
(44,253)(25,527)(47,855)(100,420)(86,341)(44,172)(72,437)(97,911)
Interest income2,362 2,060 2,704 3,406 4,691 1,174 554 220 
Interest expense(4,233)(1,603)(1,766)(1,922)(2,238)(2,219)(2,217)(2,212)
Income tax (expense) benefit
(97)(239)(233)(410)309 (132)(159)(134)
Gain on extinguishment of convertible senior notes25,171 6,495 20,083 42,270 57,193 — — — 
Other expense, net
(1,848)(158)(145)(234)(693)(902)(264)(1,911)
Net loss from continuing operations
$(22,898)$(18,972)$(27,212)$(57,310)$(27,079)$(46,251)$(74,523)$(101,948)
Net loss from continuing operations attributable to common stock
$(23,114)$(19,307)$(27,509)$(57,536)$(27,223)$(46,523)$(74,873)$(102,742)
Net loss from continuing operations per share—diluted
$(0.20)$(0.17)$(0.25)$(0.52)$(0.25)$(0.43)$(0.70)$(0.96)
(1) Includes stock-based compensation as follows:
Three Months Ended
Dec. 31, 2023Sep. 30, 2023Jun. 30, 2023Mar. 31, 2023Dec. 31, 2022Sep. 30, 2022Jun. 30, 2022Mar. 31, 2022
Cost of revenue$2,741 $3,037 $3,001 $4,135 $4,367 $4,165 $3,615 $2,990 
Technology and development8,352 8,391 8,241 8,127 6,135 6,353 6,768 7,109 
Marketing1,312 1,337 1,254 1,245 1,052 1,002 894 1,043 
General and administrative3,148 6,035 5,025 5,320 4,504 4,904 4,009 4,109 
Total$15,553 $18,800 $17,521 $18,827 $16,058 $16,424 $15,286 $15,251 
40

Table of Contents
Three Months Ended
Dec. 31, 2023Sep. 30, 2023Jun. 30, 2023Mar. 31, 2023Dec. 31, 2022Sep. 30, 2022Jun. 30, 2022Mar. 31, 2022
(as a percentage of revenue)
Revenue100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
Cost of revenue(1)
66.5 63.4 63.6 72.8 75.0 70.3 68.1 76.8 
Gross profit33.5 36.6 36.4 27.2 25.0 29.7 31.9 23.2 
Operating expenses
Technology and development(1)
20.2 16.5 17.1 22.3 19.5 14.2 13.4 20.4 
Marketing(1)
9.3 9.0 12.0 18.9 10.8 10.9 16.0 18.9 
General and administrative(1)
23.9 20.6 22.4 32.4 27.3 19.0 19.6 25.2 
Restructuring and reorganization0.4 0.0 2.2 0.5 6.3 0.1 3.6 2.6 
Total53.8 46.1 53.7 74.0 63.9 44.2 52.6 67.1 
Loss from continuing operations(20.3)(9.5)(17.3)(46.9)(38.9)(14.5)(20.7)(43.9)
Interest income1.1 0.8 1.0 1.6 2.1 0.4 0.2 0.1 
Interest expense(1.9)(0.6)(0.6)(0.9)(1.0)(0.7)(0.6)(1.0)
Income tax (expense) benefit— (0.1)(0.1)(0.2)0.1 0.0 0.0 (0.1)
Gain on extinguishment of convertible senior notes11.5 2.4 7.3 19.7 25.8 0.0 0.0 0.0 
Other expense, net(0.8)(0.1)(0.1)(0.1)(0.3)(0.3)(0.1)(0.9)
Net loss from continuing operations(10.4)%(7.1)%(9.8)%(26.8)%(12.2)%(15.1)%(21.4)%(45.8)%
(1) Includes stock-based compensation as follows:
Three Months Ended
Dec. 31, 2023Sep. 30, 2023Jun. 30, 2023Mar. 31, 2023Dec. 31, 2022Sep. 30, 2022Jun. 30, 2022Mar. 31, 2022
(as a percentage of revenue)
Cost of revenue1.3 %1.1 %1.1 %1.9 %2.0 %1.4 %1.0 %1.3 %
Technology and development3.8 3.1 3.0 3.8 2.8 2.1 1.9 3.3 
Marketing0.6 0.5 0.5 0.6 0.5 0.3 0.3 0.5 
General and administrative1.3 2.3 1.8 2.5 1.9 1.6 1.2 1.8 
Total7.0 %7.0 %6.4 %8.8 %7.2 %5.4 %4.4 %6.9 %

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.

Our 2023 revenue and cost of revenue were impacted by macroeconomic conditions; see “Adverse Macroeconomic Conditions and Our Associated Actions” under Item 7. We completed our acquisition of Bay Equity on April 1, 2022. The acquisition increased revenue, cost of revenue, and operating expenses in the second quarter, third quarter, and fourth quarter of 2022 over their seasonal pattern, because there were no such results in prior quarters.
41

Table of Contents

Quarterly Key Business Metrics
Dec. 31, 2023Sep. 30, 2023Jun. 30, 2023Mar. 31, 2023Dec. 31, 2022Sep. 30, 2022Jun. 30, 2022Mar. 31, 2022
Monthly average visitors (in thousands)
43,861 51,309 52,308 50,440 43,847 50,785 52,698 51,287 
Real estate services transactions
Brokerage10,152 13,075 13,716 10,301 12,743 18,245 20,565 15,001 
Partner3,186 4,351 3,952 3,187 2,742 3,507 3,983 3,417 
Total13,338 17,426 17,668 13,488 15,485 21,752 24,548 18,418 
Real estate services revenue per transaction
Brokerage$12,248 $12,704 $12,376 $11,556 $10,914 $11,103 $11,692 $11,191 
Partner2,684 2,677 2,756 2,592 2,611 2,556 2,851 2,814 
Aggregate9,963 10,200 10,224 9,438 9,444 9,725 10,258 9,637 
U.S. market share by units(1)
0.72 %0.78 %0.75 %0.79 %0.76 %0.80 %0.83 %0.79 %
Revenue from top-10 Redfin markets as a percentage of real estate services revenue55 %56 %55 %53 %57 %58 %59 %57 %
Average number of lead agents
1,692 1,744 1,792 1,876 2,022 2,293 2,640 2,750 
Mortgage originations by dollars (in millions)$885 $1,110 $1,282 $991 $1,036 $