Frontdoor, Inc. Q2 FY2026 Earnings Call
With Bill Cobb (Chairman and CEO) and Jason Bailey (SVP and CFO).
Frontdoor is a company that’s on a mission to make home ownership simple. We have the culture and drive of a billion-dollar startup, and are committed to transforming the home services industry. Our company has more than 50 years of unmatched expertise as the nation’s largest provider of home service plans.
More about Frontdoor, Inc.
Last year, we responded to more than four million service requests from customers who depend on us for financial protection and professional repairs when a covered item breaks down. At Frontdoor, we wake up every day and obsess about how to take the hassle out of our customer’s lives. We’re inquisitive and innovative, never satisfied with the status quo. We solve problems and make lives better, and enjoy what we do. Our leadership team has a dynamic mix of experience in disrupting industries, changing how consumers receive products and services, creating leading digital platforms, and ensuring a world-class customer experience. They don’t just talk about culture, they live it, and it's one of ownership, accountability, problem solving, and doing great things every day. Our family of brands includes American Home Shield (the home warranty plan industry founder and leader), HSA, Landmark and OneGuard. We serve more than two million customers across the U.S. through a network of approximately 17,000 pre-qualified contractor firms that employ over 60,000 technicians.
1Prepared remarks3 speakers
Thank you, operator. Good morning, everyone, thank you for joining Frontdoor's second quarter 2026 earnings conference call. Joining me today are Bill Cobb, Chairman and CEO, and Jason Bailey, Senior Vice President and CFO. The press release and slide presentation that will be used during today's call can be found on the investor relations section of Frontdoor's website, which is located at www.investors.frontdoorhome.com. As stated on slide three of the presentation, I'd like to remind you that this call and…
Thanks, Matthew, good morning, everyone. Frontdoor delivered exceptional results in the second quarter across all key areas of the business. At the mid-year mark, we are driving member growth, with total ending member count up 1%, the first organic growth in five years. We are successfully scaling our non-warranty and other business, which is rapidly approaching a quarter of a billion dollars in annual revenue. We're delivering structurally higher margins, we continue to maintain capital discipline.
We expect to…
Thanks, Bill. We had an excellent quarter, and I want to start by focusing on how we keep delivering these strong results. It starts with a predictable, renewal-driven base that gives us a recurring revenue foundation. On top of that, operational excellence is driving structurally higher margins than just a few years ago. That combination generates a lot of cash, where we converted adjusted EBITDA to free cash flow at more than 60%. We're putting that cash to work, returning around $900 million to shareholders…
Thank you, Jason. Before we open it up to questions, I want to emphasize three key takeaways. First, our total member count is past the inflection point. Even with one of the most challenging housing markets we've seen in a generation, we're growing total member count again. Second, our operating model is doing what we built it to do quarter after quarter. We are delivering structurally higher margins in line with our long-term targets. Third, we expect to finish our latest share repurchase authorization…