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This story originally appeared on Real Estate News.
Redfin CEO Glenn Kelman. (Redfin Photo)
Redfin closed out 2024 with a healthy bump in revenue, but profits were lower as the company continues to adjust to its new agent pay model and “several restructurings” in the past year.
Revenue met expectations, increasing 12% in the fourth quarter and up 7% for the full year, the company reported. The company’s net loss per share was 29 cents, however, higher than investor estimates of around 23 cents per share, totaling more than $36 million for the quarter. During the same period a year ago, Redfin’s net loss was just under $30 million.
Losses were up in part due to the costs associated with transitioning to Redfin Next — the company’s new commission split model — which has brought in more new agents than anticipated.
Redfin Next rolled out nationally in October and appears to be attracting a lot of interest. At the end of the year, the company had 1,927 lead agents — a 14% increase year-over-year — and that momentum has continued into 2025. As of last week, the company said, agent count topped 2,200, a boost of roughly 13% in less than two months.
During a call with investors on Feb. 27, Redfin CEO Glenn Kelman said the company has been pleased with the new hires, who are generally more experienced agents. “The rapid expansion of our sales force is just one of the ways that Redfin plans to go on the attack in 2025,” Kelman said.
Despite the increased revenue and agent count, Redfin’s stock was down around 11% in after-hours trading.
Kelman hopes ‘painful’ restructuring will boost profits
Earlier this month, Zillow announced that it would pay Redfin $100 million for an exclusive rentals syndication agreement — a lucrative partnership for Redfin, but one that also resulted in significant layoffs in the company’s rentals division.
“We’ve gone through several restructurings in 2024 and then we had an especially painful one at the beginning of 2025 because we wanted to put all the chips on the table on growth and to spend less on staffing,” Kelman said.
But the company plans to put those cost savings into a marketing campaign in the first quarter, Kelman said, specifically targeting sellers who are looking for lower listing fees during a period of economic uncertainty.
Redfin is focused on growing market share in 2025, Kelman said, because he doesn’t expect home sales to make a significant recovery. By trimming staff and increasing the brokerage’s sales force, Kelman is expecting a positive EBITDA this year after a $26.5 million miss in 2024.
Private listings even less compelling in a slow market
Asked to weigh in on the Clear Cooperation Policy and the movement toward more private listings, Kelman reiterated his position that pocket listings are bad for consumers. He also said the timing of the CCP debate is unusual since inventory is growing and listings are staying on the market longer.
“As the market softens, where it gets harder to sell a house… it just seems harder to make the argument that you want to debut a listing without getting maximum exposure,” Kelman said.
Key numbers
Revenue: $244.3 million, up 12% compared to the fourth quarter of 2023. For all of 2024, Redfin’s revenue was $1.04 billion, up 7% year-over-year.
Cash and cash equivalents: $124.7 million in the fourth quarter, down from $149.8 million at the end of 2023.
Net income/loss: A loss of $36.4 million, more than the $22.9 million loss at the end of 2023. For the full year, the net loss was $164.8 million, more than the $130 million loss in 2023.
Adjusted EBITDA (earnings before income, taxes, depreciation and amortization): A loss of $2.9 million in Q4, less than the loss of $13.5 million a year prior. For all of 2024, the loss was $26.5 million, an improvement over the $76.4 million loss in 2023.
Average number of lead agents: 1,927 at the end of 2024, up 14% from a year ago. It was also the third straight quarter of agent growth.
Transactions: 14,363 for the fourth quarter, up 7.7% compared to a year ago.
Site traffic: 43 million average monthly users, down 3% from a year ago.
