What caused FTDR's Q3 earnings to fall short of forecasts?

Frontdoor's Q3 earnings fell short of forecasts due to a combination of factors:

1. **Revenue Shortfall**: Frontdoor missed analysts' revenue expectations by 0.7% in Q3, reporting revenues of $540 million, up 3.1% year-on-year. This was primarily due to a decline in home service plans, which averaged 3.9% year-on-year declines over the past two years, indicating potential market saturation or increasing competition.
2. **Earnings Impact**: The company's earnings per share (EPS) were not impacted as it met analysts' EPS estimates. However, the revenue shortfall and the overall mixed performance of the specialized consumer services sector led to a decline in share prices, with Frontdoor's stock dropping 22.6%.
3. **Market Conditions**: The specialized consumer services sector faced challenging market conditions, with revenues beating analysts' consensus estimates by only 0.6% while next quarter's revenue guidance was 0.5% below. This suggests that while Frontdoor outperformed its peers in terms of revenue growth, it still faced broader industry headwinds that affected investor sentiment.

In conclusion, Frontdoor's Q3 earnings fell short of forecasts primarily due to a decline in home service plans and challenging market conditions in the specialized consumer services sector.