• AAA for your home's major systems and appliances.

• ADT for your home's vital systems.

• Best Buy's Geek Squad Protection Plan, but for an entire house.

• Home Service Plans (Home Warranties): These service contracts cover the repair or replacement of major home systems and appliances that break down due to normal wear and tear, connecting customers with a network of pre-qualified service professionals.

Major Customers of Frontdoor (FTDR)

Frontdoor (FTDR) primarily sells home service plans (home warranties) directly to individuals, making its business model predominantly Business-to-Consumer (B2C). Its major brands include American Home Shield, HSA Home Warranty, Landmark Home Warranty, and OneGuard Home Warranties.

The company serves the following categories of individual customers:

• Existing Homeowners: These are individuals who currently own and reside in a home and proactively purchase a home warranty to protect against the cost of unexpected repairs or replacements for their home's major systems and appliances (e.g., HVAC, plumbing, electrical, refrigerators, washers, dryers). They seek to mitigate financial risk and gain peace of mind.
• Home Sellers: Individuals who are in the process of selling their property often purchase a home warranty, typically for a one-year term, to offer to the buyer. This acts as an incentive and a layer of protection against potential post-sale issues, which can help facilitate the sale and provide assurance to the prospective buyer.
• Home Buyers: These are individuals who are purchasing a home and either receive a home warranty as part of their real estate transaction (often paid for by the seller or real estate agent) or choose to purchase one themselves. They seek financial protection against unforeseen breakdowns of home systems and appliances shortly after moving into their new property, especially for older homes.

William C. Cobb, Chairman and Chief Executive Officer

Bill Cobb became Chief Executive Officer of Frontdoor in June 2022, in addition to his role as Chairman of the Board of Directors, which he has held since October 2018. He is recognized for his expertise in consumer-focused, technology, and online-focused businesses. Prior to joining Frontdoor, Cobb served as President and CEO of H&R Block, Inc. from May 2011 through July 2017. He also held various leadership roles at eBay, Inc. from 2000 to 2008, including president of eBay Marketplaces North America. Earlier in his career, from 1987 to 2000, Cobb held marketing and executive positions at PepsiCo and Tricon Global Restaurants (now Yum! Brands), including senior vice president and chief marketing officer for Tricon International and Pizza Hut.

Jason Bailey, Senior Vice President and Chief Financial Officer

Jason Bailey was appointed Senior Vice President and Chief Financial Officer of Frontdoor, effective November 10, 2025. He has over 25 years of progressive leadership experience in finance and public accounting, including more than 15 years of service with Frontdoor and its former publicly traded parent, ServiceMaster. Most recently, Bailey served as VP, Finance, for Frontdoor. His professional experience also includes 11 years of public accounting experience at Deloitte and Arthur Andersen.

Evan Iverson, Senior Vice President and Chief Operating Officer

Evan Iverson was promoted to Senior Vice President and Chief Operating Officer in August 2024. He is responsible for overseeing all aspects of the day-to-day operational functions for the American Home Shield and Frontdoor brands, focusing on enhancing contractor and member experiences. He also manages relationships with approximately 16,000 independent contractors and provides oversight of the company's technology strategy. Iverson joined Frontdoor in January 2019 as Vice President, Operations. Before Frontdoor, he worked at Amazon for over three years, leading product and business teams in solving operations problems with technology and overseeing $3.5 billion in revenue for Fulfillment By Amazon (FBA). He also spent six years at McKinsey leading operations transformations.

Jeffrey A. Fiarman, Senior Vice President, Chief Legal Officer and Corporate Secretary

Jeffrey Fiarman joined Frontdoor in August 2018 as senior vice president, general counsel and corporate secretary. He is described as an entrepreneurial-minded company builder and a strong legal advisor with a track record in business development and leadership. Prior to Frontdoor, Fiarman served as executive vice president, general counsel, and secretary of IDEXX Laboratories. He also held several leadership roles with WW International, Inc. (formerly Weight Watchers International, Inc.), including seven years as executive vice president, general counsel, and secretary, and was a member of the founding leadership team for WW's internet business. Fiarman co-founded a consumer wearable technology company and advised startups and new business ventures. He began his career as an attorney specializing in corporate and tax law at Gibson, Dunn & Crutcher.

Dr. Bala Ganesh, Senior Vice President and Chief Technology Officer

Dr. Bala Ganesh assumed the role of Frontdoor's Senior Vice President and Chief Technology Officer in July 2025. He previously served as a Frontdoor, Inc. board director from July 2023 to June 2025. In his current role, Ganesh is responsible for overseeing all technical aspects of Frontdoor's brands, including strategy, development, and implementation of technology, with a focus on strategic direction and oversight for scalable solutions. He brings extensive experience in digital transformation, cybersecurity, and product development. Prior to Frontdoor, Ganesh was the Chief Technology Officer of OnTrac Logistics and a Partner at AKF Consulting LLC. He also served at United Parcel Service (UPS) for over 10 years in various roles, including Vice President of Engineering, where he managed UPS's global technology innovation strategy, and Vice President of Advanced Technology, where he led the strategy for aerial drones, robotics, sensors, artificial intelligence, and autonomous vehicles. Ganesh served for six years as a fighter pilot in the Indian Air Force.

The key risks to Frontdoor's business (FTDR) include:

1. Macroeconomic Headwinds and Housing Market Sensitivity: Frontdoor's business is highly sensitive to macroeconomic conditions, including rising interest rates, inflation, and a slowdown in home purchases. Weakness in the housing market or discretionary consumer spending can negatively impact plan renewals and new sales. The company's stock has historically demonstrated "very weak downturn resilience," with significant drops during past market corrections, reflecting its high sensitivity to housing market slowdowns and investor sentiment.
2. Significant Indebtedness: The company carries approximately $2.5 billion in debt, largely due to acquisitions. This substantial indebtedness can limit Frontdoor's financial flexibility and increase its vulnerability during economic downturns. Additionally, Frontdoor is exposed to interest rate risks because of its variable-rate indebtedness, which could adversely affect its interest expenses and overall profitability.
3. Reliance on and Challenges within the Contractor Network: Frontdoor's service delivery is heavily dependent on a vast network of around 17,000 independent contractor firms. Any disruptions in this network, or difficulties in maintaining and expanding it, could negatively impact service quality and customer satisfaction, which are crucial for the company's operations and customer retention.

The emergence of tech giants (e.g., Amazon, Google) leveraging their smart home ecosystems and existing service marketplaces to offer comprehensive, subscription-based "Home Care as a Service" solutions represents a clear emerging threat to Frontdoor. These platforms have the potential to integrate predictive maintenance capabilities (using data from smart home devices), direct dispatch of vetted service professionals, and bundled cost coverage into a single, proactive offering that could diminish the value proposition of traditional, reactive home warranty plans.

Frontdoor (FTDR) operates primarily in the home warranty and on-demand home services markets.

• Home Warranty Market:
  • The United States home warranty market was valued at approximately $4.26 billion in 2024 and is projected to reach about $5.68 billion by 2032.
  • North America represented the largest share of the home warranty service market, accounting for $3.56 billion in 2024.
  • The global market for home warranty services is estimated to reach $13.6 billion by 2030.
• On-Demand Home Services Market:
  • The global online on-demand home services market was estimated at $3.71 billion in 2021 and is anticipated to reach $14.7 billion by 2030.
  • Another estimate places the global online on-demand home services market size at $5.15 billion in 2024, projected to grow to $19.65 billion by 2033.
  • North America held the largest share of the global online on-demand home services market, with 35.4% in 2021 and 44.63% in 2023. The U.S. online on-demand home services market is experiencing significant growth.

Frontdoor (FTDR) is expected to drive future revenue growth over the next 2-3 years through several key strategies:

1. Expansion of Non-Warranty Services: Frontdoor anticipates significant growth from its non-warranty offerings, particularly new HVAC sales, with a projected 44% increase in non-warranty revenue. The company also plans to expand into new categories, such as a nationwide appliance replacement pilot in 2026, further diversifying its revenue streams.
2. Customer Growth and Retention: The company is focused on increasing its member base, reporting an 8% growth in its first-year organic direct-to-consumer ending member count and a sequential increase in real estate member count, a milestone not seen in five years. Additionally, Frontdoor has shown improved customer retention rates, which contribute to sustained revenue.
3. Strategic Pricing Initiatives: Frontdoor's revenue growth has been positively impacted by strategic price increases, with pricing contributing to a portion of its overall revenue increase.
4. Synergies from the 2-10 Home Buyers Warranty Acquisition: The acquisition of 2-10 Home Buyers Warranty has been a significant contributor to revenue growth, primarily by increasing volume. The company expects continued contributions and accelerated synergies from this acquisition.

Share Repurchases

• Frontdoor completed its previous three-year, $400 million share repurchase authorization in August 2024.
• The company announced a new three-year, $650 million share repurchase authorization that commenced on September 4, 2024.
• Frontdoor utilized $160 million to repurchase approximately 4 million shares in full-year 2024.

Share Issuance

• No significant share issuances by the company for capital raising purposes were identified within the last 3-5 years, beyond routine employee stock awards.

Inbound Investments

• No large inbound investments by third parties (e.g., strategic partners or private equity firms) in Frontdoor were identified within the last 3-5 years.

Outbound Investments

• Frontdoor entered into an agreement to acquire 2-10 Home Buyers Warranty for $585 million in an all-cash transaction, which was completed in December 2024.
• The acquisition of 2-10 Home Buyers Warranty was partially financed by a new $1.47 billion credit facility that also refinanced existing debt.

Capital Expenditures

• Capital expenditures were $39 million for the full year 2024, an increase from $32 million in 2023.
• The primary focus of capital expenditures has been on technology projects.
• Expected capital expenditures for 2025 are approximately $35 million to $45 million.