What changed in this filing

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Item 1. Financial Statements

2023-11-01 compared with 2023-08-02 · 103 added, 63 removed, 388 unchanged (30% of the section changed)

4 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Cost of services rendered

1 unchanged sentence

Depreciation and amortization expense

Goodwill and intangibles impairment

Restructuring charges

13 unchanged sentences

(In millions, except share data)

September 30,

Current Assets:

2 unchanged sentences

Prepaid expenses and other current assets

Contract asset

Contract assets

Total Current Assets

23 unchanged sentences

2,000,000,000 shares authorized;

86,437,468 shares issued and 80,793,358 shares outstanding as of June 30, 2023 and 86,079,773 shares issued and 81,517,243 shares outstanding as of December 31, 2022

86,502,847 shares issued and 79,617,524 shares outstanding as of September 30, 2023 and 86,079,773 shares issued and 81,517,243 shares outstanding as of December 31, 2022

Additional paid-in capital

2 unchanged sentences

Less treasury stock, at cost;

5,644,110 shares as of June 30, 2023 and 4,562,530 shares as of December 31, 2022

6,885,323 shares as of September 30, 2023 and 4,562,530 shares as of December 31, 2022

Total Shareholders'

5 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

Common Stock:

5 unchanged sentences

Exercise of stock options

Issuance of common stock related to ESPP

Taxes paid related to net share settlement of equity awards

Issuance of common stock related to ESPP

Balance at end of period

15 unchanged sentences

(In millions)

Six Months Ended

Nine Months Ended

September 30,

Cash and Cash Equivalents at Beginning of Period

4 unchanged sentences

Stock-based compensation expense

Goodwill and intangibles impairment

Restructuring charges

9 unchanged sentences

Purchases of property and equipment

Other investing activities

Net Cash Used for Investing Activities

4 unchanged sentences

Net Cash Used for Financing Activities

Cash Increase During the Period

Cash Increase (Decrease) During the Period

Cash and Cash Equivalents at End of Period

6 unchanged sentences

Our home service plan customers usually subscribe to an annual service plan agreement that covers the repair or replacement of major components of more than 20 home systems and appliances, including electrical, plumbing, HVAC systems, water heaters, refrigerators, dishwashers and ranges/ovens/cooktops, as well as optional coverages for electronics, pools, spas and pumps.

Frontdoor also provides a one-stop app for home repair and maintenance.

Frontdoor also provides on-demand home services and a one-stop app for home repair and maintenance.

Enabled by our Streem technology, the app empowers homeowners by connecting them in real time through video chat with pre-qualified experts to diagnose and solve their problems.

Additionally, Frontdoor now offers home service plans under the Frontdoor brand.

As of June 30, 2023, we had 2.1 million active home service plans across all brands in the United States.

As of September 30, 2023, we had 2.0 million active home service plans across all brands in the United States.

Significant Accounting Policies

Our significant accounting policies are described in Note 2 to the audited consolidated financial statements included in our 2022 Form 10-K.

There have been no material changes to our significant accounting policies during the six months ended June 30, 2023.

There have been no material changes to our significant accounting policies during the nine months ended September 30, 2023.

Basis of Presentation

17 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In millions)

11 unchanged sentences

Renewals relate to consecutive contract periods and take place at the end of the first year of a real estate or direct-to-consumer home service plan contract.

Customer payments for renewals are typically received either at the commencement of the renewal period or in installments over the new contract period.

Customer payments for renewals are primarily received in installments over the new contract period.

Real estate home service plans are sold through annual contracts which occur in connection with a real estate sale.

4 unchanged sentences

Direct-to-consumer home service plans are sold through annual contracts which occur in response to our marketing efforts.

Customer payments for direct-to-consumer sales are typically received at the commencement of the contract or in installments over the contract period.

Customer payments for direct-to-consumer sales are primarily received in installments over the contract period.

First-year revenue from the direct-to-consumer channel is classified as direct-to-consumer above.

At the option of the customer, upon renewal of the contract, the future revenue derived from home service plans sold in this channel is classified as Renewal revenue as described above.

Other revenue primarily includes revenue generated by on-demand home services and Streem, as well as administrative fees and ancillary services attributable to our home service plan contracts.

Other revenue primarily includes revenue generated by on-demand home services, as well as administrative fees and ancillary services attributable to our home service plan contracts.

Deferred Customer Acquisition Costs

We capitalize the incremental costs of obtaining a contract with a customer, primarily sales commissions, and recognize the related expense using the input method in proportion to the costs expected to be incurred in performing services under the contract, over the expected customer relationship period.

Deferred customer acquisition costs were $ 14 million and $ 16 million as of June 30, 2023 and December 31, 2022, respectively.

Amortization of deferred customer acquisition costs was $ 5 million and $ 6 million for the three months ended June 30, 2023 and 2022, respectively, and $ 8 million and $ 10 million for the six months ended June 30, 2023 and 2022, respectively.

There were no impairment losses related to these capitalized costs during the three months ended June 30, 2023 and 2022.

We capitalize the incremental costs of obtaining a contract with a customer and recognize the related expense using the input method in proportion to the costs expected to be incurred in performing services under the contract, over the expected customer relationship period.

Deferred customer acquisition costs were $ 12 million and $ 16 million as of September 30, 2023 and December 31, 2022, respectively.

Amortization of deferred customer acquisition costs was $ 5 million and $ 6 million for the three months ended September 30, 2023 and 2022, respectively, and $ 13 million and $ 15 million for the nine months ended September 30, 2023 and 2022, respectively.

There were no impairment losses related to these capitalized costs during the three months ended September 30, 2023 and 2022.

Receivables, Less Allowance

5 unchanged sentences

These timing differences are created when the recognition of revenue in proportion to the costs expected to be incurred in performing the services under the contract are accelerated as compared to the recognition of revenue on a straight-line basis over the contract period.

Contract assets were $ 14 million as of June 30, 2023.

Contract assets were $ 72 million as of September 30, 2023.

Our contract liabilities consist of deferred revenue which is recognized when cash payments are received in advance of the performance of services, including when the amounts are refundable.

Amounts are recognized as revenue in proportion to the costs expected to be incurred in performing services under our contracts.

A summary of the changes in deferred revenue for the six months ended June 30, 2023 is as follows:

A summary of the changes in deferred revenue for the nine months ended September 30, 2023 is as follows:

(In millions)

3 unchanged sentences

Balance at end of period

There was approximately $ 47 million and $ 94 million of revenue recognized during the three and six months ended June 30, 2023, respectively, that was included in the deferred revenue balance as of December 31, 2022.

Intangible Assets

There was approximately $ 25 million and $ 120 million of revenue recognized during the three and nine months ended September 30, 2023, respectively, that was included in the deferred revenue balance as of December 31, 2022.

Goodwill and Intangible Assets

Goodwill and indefinite-lived intangible assets are not amortized and are subject to assessment for impairment on an annual basis or more frequently if circumstances indicate a potential impairment.

An assessment for impairment is performed on October 1 of every year.

In connection with the preparation of our condensed consolidated financial statements for the third quarter of 2022, we determined that indicators of a potential goodwill and intangible assets impairment were present for our Streem reporting unit.

In particular, we will be more focused on integrating Streem’s technology into our core business and will be less focused on selling this technology platform to third-party business-to-business customers as a software-as-a-service platform.

This shift in focus resulted in significantly lower projected revenue for Streem.

We performed an interim impairment analysis of the Streem reporting unit as of September 30, 2022.

In performing the discounted cash flow analysis, we determined that the carrying amount of the Streem reporting unit exceeded its fair value.

An impairment charge of $ 14 million was recognized during the third quarter of 2022, which comprised the remaining net carrying amount of Streem’s goodwill of $ 9 million and intangible assets of $ 5 million.

The balance of goodwill was $ 503 million as of September 30, 2023 and December 31, 2022.

There were no goodwill impairment charges recorded in the three and nine months ended September 30, 2023.

The following table provides a summary of the components of our intangible assets:

As of June 30, 2023

As of September 30, 2023

As of December 31, 2022

5 unchanged sentences

(1) Not subject to amortization.

Amortization expense was $ 1 million and $ 2 million for the three months ended June 30, 2023 and 2022, respectively, and $ 2 million and $ 4 million for the six months ended June 30, 2023 and 2022, respectively.

There were no impairment charges in these periods.

Amortization expense was $ 1 million and $ 2 million for the three months ended September 30, 2023 and 2022, respectively, and $ 3 million and $ 6 million for the nine months ended September 30, 2023 and 2022, respectively.

As indicated above, an impairment charge of $ 5 million was recognized during the three and nine months ended September 30, 2022 related to Streem’s intangible assets.

There were no intangible asset impairment charges for the three and nine months ended September 30, 2023.

We have operating leases primarily for our corporate offices, customer service centers and engineering and technology campuses.

1 unchanged sentence

The weighted-average remaining lease term and weighted-average discount rate related to our operating leases are as follows:

September 30,

Weighted-average remaining lease term (years)

Weighted-average discount rate

We recognized operating lease expense of $ 1 million for each of the three months ended June 30, 2023 and 2022 and $ 2 million for each of the six months ended June 30, 2023 and 2022.

We recognized operating lease expense of $ 1 million for each of the three months ended September 30, 2023 and 2022 and $ 2 million and $ 3 million for the nine months ended September 30, 2023 and 2022, respectively.

These expenses are included in selling and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive income.

Supplemental balance sheet information related to our operating lease liabilities is as follows:

September 30,

(In millions)

3 unchanged sentences

Supplemental cash flow information related to our operating leases is as follows:

Six Months Ended

Nine Months Ended

September 30,

(In millions)

Cash paid on operating lease liabilities (1)

The following table presents the maturities of our operating lease liabilities as of June 30, 2023:

_____________________________

(1) Amount is presented net of cash provided from sublease income.

The following table presents the maturities of our operating lease liabilities as of September 30, 2023:

(In millions)

7 unchanged sentences

On August 10, 2022, we subleased our prior corporate headquarters facility in Memphis, Tennessee.

As a result of us exiting the facility on June 27, 2022, we incurred a non-cash impairment charge of $ 11 million for the three and six months ended June 30, 2022.

As a result of us exiting the facility on June 27, 2022, we incurred a non-cash impairment charge of $ 11 million for the nine months ended September 30, 2 022.

Relocation of Phoenix Customer Service Center

On August 15, 2023, we entered into a new lease in Scottsdale, Arizona, and subsequently decided to exit our lease in Phoenix, Arizona.

As a result, we incurred a non-cash impairment charge of $ 2 million for the three and nine months ended September 30 , 2023.

We are subject to taxation in the United States, various states and foreign jurisdictions.

Substantially all of our income before income taxes for the three months ended June 30, 2023 and 2022 was generated in the United States.

Substantially all of our income before income taxes for the three months ended September 30, 2023 and 2022 was generated in the United States.

We compute interim period income taxes by applying an anticipated annual effective tax rate to our year-to-date income or loss from operations before income taxes, except for significant unusual or infrequently occurring items.

As a result, our estimated tax rate is adjusted each quarter.

The effective tax rate on income before income taxes was 24.8 percent and 23.2 percent for the three months ended June 30, 2023 and 2022, respectively, and 24.9 percent and 25.1 percent for the six months ended June 30, 2023 and 2022, respectively.

The increase in the effective tax rate for the three months ended June 30, 2023 compared to 2022 was primarily due to the impacts of share-based awards and a decrease in income tax credits, partially offset by state income taxes.

The effective tax rate on income before income taxes was 25.3 percent and 28.2 percent for the three months ended September 30, 2023 and 2022, respectively, and 25.1 percent and 26.5 percent for the nine months ended September 30, 2023 and 2022, respectively.

The decrease in the effective tax rate for the three and nine months ended September 30, 2023 compared to 2022 was primarily due to the impact of the goodwill and intangibles impairment recorded in the third quarter of 2022 and the impact of a lower pre-tax income in 2022, offset, in part, by a reduction in income tax credits in 2023 as compared to 2022.

Restructuring Charges

We incurred restructuring charges of less than $ 1 million (less than $ 1 million, net of tax) and $ 12 million ($ 9 million, net of tax) for the three months ended June 30, 2023 and 2022, respectively, and $ 1 million ($ 1 million, net of tax) and $ 12 million ($ 9 million, net of tax) for the six months ended June 30, 2023 and 2022, respectively.

For the three and six months ended June 30, 2023, restructuring charges primarily include severance costs.

For the three and six months ended June 30, 2022, restructuring charges primarily comprised an $ 11 million impairment charge related to our prior corporate headquarters facility operating lease right-of-use asset and leasehold improvements and $ 1 million of severance and other costs.

The impairment was the result of vacating the facility with the intent to sublease.

We incurred restructuring charges of $ 5 million ($ 4 million, net of tax) for each of the three months ended September 30, 2023 and 2022 and $ 6 million ($ 5 million, net of tax) and $ 18 million ($ 13 million, net of tax) for the nine months ended September 30, 2023 and 2022, respectively.

For the three and nine months ended September 30, 2023, restructuring charges primarily comprised a $ 2 million impairment charge related to our Phoenix, AZ customer service center’s operating lease right-of-use asset and related fixed assets and $ 2 million of professional fees, with the balance comprised of severance costs.

The impairment charge was the result of our decision to exit the leased property.

For the three months ended September 30, 2022, restructuring charges primarily comprised a $ 2 million impairment of certain internally developed software and $ 3 million of severance and other costs.

Severance costs of $ 2 million related to a reduction in workforce of seven percent as part of our completed strategic review of our selling, general and administrative expenses.

For the nine months ended September 30, 2022, restructuring charges primarily comprised an $ 11 million impairment charge related to our prior corporate headquarters facility operating lease right-of-use asset and leasehold improvements, a $ 2 million impairment of certain internally developed software and $ 5 million of severance and other costs.

Severance costs of $ 2 million related to a reduction in workforce of seven percent as part of our completed strategic review of our selling, general and administrative expenses.

The pre-tax charges discussed above are reported in “Restructuring charges” in the accompanying consolidated statements of operations and comprehensive income.

As of December 31, 2022, there were $ 2 million of restructuring charges accrued, of which $ 1 million were paid or otherwise settled during the six months ended June 30, 2023.

As of June 30, 2023, there were $ 1 million in accrued restructuring charges in the accompanying condensed consolidated statements of financial position.

As of December 31, 2022, there were $ 2 million of restructuring charges accrued, of which $ 1 million were paid or otherwise settled during the nine months ended September 30, 2023.

As of September 30, 2023, there was $ 2 million in accrued restructuring charges in the accompanying condensed consolidated statements of financial position.

Commitments and Contingencies

14 unchanged sentences

Stock-Based Compensation

We recognized stock-based compensation expense of $ 8 million ($ 7 million, net of tax) and $ 6 million ($ 4 million, net of tax) for the three months ended June 30, 2023 and 2022, respectively, and $ 13 million ($ 11 million, net of tax) and $ 12 million ($ 10 million, net of tax) for the six months ended June 30, 2023 and 2022, respectively.

We recognized stock-based compensation expense of $ 8 million ($ 7 million, net of tax) and $ 5 million ($ 4 million, net of tax) for the three months ended September 30, 2023 and 2022, respectively, and $ 21 million ($ 18 million, net of tax) and $ 17 million ($ 15 million, net of tax) for the nine months ended September 30, 2023 and 2022, respectively.

These costs are included in selling and administrative expenses in the accompanying condensed consolidated statements of operations and comprehensive income.

A summary of awards granted under the Omnibus Plan during the six months ended June 30, 2023 is as follows:

A summary of awards granted under the Omnibus Plan during the nine months ended September 30, 2023 is as follows:

Stock options

4 unchanged sentences

The performance options contain a market condition that is based on a per share price target for our common stock, and the ultimate number of performance options that may be earned depends on the achievement of this market condition.

As of June 30, 2023 , there was $ 49 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options, performance options, restricted stock units (“RSUs”), performance shares and restricted stock awards (“RSAs”).

As of September 30, 2023 , there was $ 41 million of total unrecognized compensation cost, net of estimated forfeitures, related to unvested stock options, performance options, restricted stock units (“RSUs”), performance shares and restricted stock awards (“RSAs”).

These remaining costs are expected to be recognized over a weighted-average period of 2.84 years.

1 unchanged sentence

A summary of our debt is as follows:

September 30,

(In millions)

5 unchanged sentences

_______________________________

(1) Term Loan A is presented net of unamortized debt issuance costs of $ 1 million and $ 2 million as of June 30, 2023 and December 31, 2022, respectively.

(2) Term Loan B is presented net of unamortized debt issuance costs of $ 3 million and unamortized discount of $ 1 million as of June 30, 2023 and December 31, 2022.

(1) Term Loan A is presented net of unamortized debt issuance costs of $ 1 million and $ 2 million as of September 30, 2023 and December 31, 2022, respectively.

(2) Term Loan B is presented net of unamortized debt issuance costs of $ 2 million and $ 3 million as of September 30, 2023 and December 31, 2022, respectively, and unamortized discount of $ 1 million as of September 30, 2023 and December 31, 2022.

In March 2023, in connection with the planned phase-out of LIBOR, we amended our Credit Facilities to replace LIBOR with SOFR as the benchmark rate under the Credit Agreement.

This change was effective in March 2023 for the Term Loan A and the Revolving Credit Facility and in June 2023 for the Term Loan B.

As of June 30, 2023, we had $ 2 million of letters of credit outstanding under our $ 250 million Revolving Credit Facility, and the available borrowing capacity under the Revolving Credit Facility was $ 248 million.

As of June 30, 2023, we were in compliance with the covenants under the Credit Agreement.

As of September 30, 2023, we had $ 2 million of letters of credit outstanding under our $ 250 million Revolving Credit Facility, and the available borrowing capacity under the Revolving Credit Facility was $ 248 million.

As of September 30, 2023, we were in compliance with the covenants under the Credit Agreement.

Scheduled Debt Payments

The following table presents future scheduled debt payments as of June 30, 2023:

The following table presents future scheduled debt payments as of September 30, 2023:

(In millions)

5 unchanged sentences

Supplemental information relating to our accompanying condensed consolidated statements of cash flows is as follows:

Six Months Ended

Nine Months Ended

September 30,

(In millions)

19 unchanged sentences

A summary of reclassifications out of AOCI is as follows:

Six Months Ended

Nine Months Ended

September 30,

(In millions)

16 unchanged sentences

See Note 12 to the accompanying condensed consolidated financial statements for the effective portion of the gain or loss on derivative instruments recorded in AOCI and for the amounts reclassified out of AOCI and into earnings during the periods presented.

As the underlying forecasted transactions occur during the next 12 months, we estimate the unrealized hedging gain in AOCI expected to be recognized in earnings is $ 6 million, net of tax, as of June 30, 2023.

The amounts ultimately reclassified into earnings during the next 12 months will be determined based on the actual interest rates in effect at the time the positions are settled, and as a result, they could differ materially from our estimate noted above.

7 unchanged sentences

The period-end carrying amounts of cash and cash equivalents, receivables, accounts payable and accrued liabilities approximate their fair values due to the short-term maturities of these financial instruments.

As of June 30, 2023 and December 31, 2022, the carrying amounts of our total debt were $ 601 million and $ 609 million, respectively, and the estimated fair values were $ 598 million and $ 613 million, respectively.

As of September 30, 2023 and December 31, 2022, the carrying amounts of our total debt were $ 597 million and $ 609 million, respectively, and the estimated fair values were $ 600 million and $ 613 million, respectively.

The fair value of our debt was estimated based on available market prices for the same or similar instruments that are considered significant other observable inputs (Level 2) within the fair value hierarchy and was based on information available to us as of the respective period end dates.

2 unchanged sentences

The expected future settlements are determined by comparing the contract interest rate to the expected forward interest rate as of each settlement date and applying the difference between these two rates to the notional amount of debt in the interest rate swap contract.

We did not change our valuation techniques for measuring the fair value of any financial assets and liabilities during the six months ended June 30, 2023 .

We did not change our valuation techniques for measuring the fair value of any financial assets and liabilities during the nine months ended September 30, 2023 .

Transfers between hierarchy levels, if any, are recognized at the end of the reporting period.

There were no transfers between hierarchy levels during the six months ended June 30, 2023.

There were no transfers between hierarchy levels during the nine months ended September 30, 2023.

Our interest rate swap contract is currently our only financial instrument remeasured at fair value on a recurring basis.

2 unchanged sentences

(In millions)

As of June 30, 2023:

As of September 30, 2023:

Prepaid expenses and other current assets

3 unchanged sentences

On September 7, 2021, we announced a three-year repurchase authorization of up to $ 400 million of outstanding shares of our common stock over the three-year period from September 3, 2021 through September 3, 2024.

As of June 30, 2023, we have repurchased a total of 5,552,053 outstanding shares at an aggregate cost of $ 195 million, which is included in treasury stock on the accompanying condensed consolidated statements of financial position, and had $ 205 million remaining available for future repurchases under this program.

As of September 30, 2023, we have repurchased a total of 6,793,266 outstanding shares at an aggregate cost of $ 236 million, which is included in treasury stock on the accompanying condensed consolidated statements of financial position, and we had $ 164 million remaining available for future repurchases under this program.

A summary of repurchases of outstanding shares is as follows:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In millions, except per share data)

3 unchanged sentences

________________________________

(1) The average price paid per share is calculated on a trade date basis and excludes commissions.

(1) The average price paid per share is calculated on a trade date basis and excludes associated fees.

Earnings Per Share

4 unchanged sentences

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In millions, except per share data)

6 unchanged sentences

___________________________________

(1) RSUs of 74,736 shares and 1,009,556 shares for the three months ended June 30, 2023 and 2022, respectively, and 719,660 shares and 866,384 shares for the six months ended June 30, 2023 and 2022, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive.

(2) Stock options to purchase 1,489,773 shares and 1,630,293 shares for the three months ended June 30, 2023 and 2022, respectively, and 1,332,990 shares and 1,416,344 shares for the six months ended June 30, 2023 and 2022, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive.

Performance options to purchase 785,119 shares and 89,836 shares for the three months ended June 30, 2023 and 2022, respectively, and 523,312 shares and 45,166 shares for the six months ended June 30, 2023 and 2022, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive.

(1) RSUs of 59,880 shares and 778,828 shares for the three months ended September 30, 2023 and 2022, respectively, and 471,836 shares and 973,418 shares for the nine months ended September 30, 2023 and 2022, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive.

(2) Stock options to purchase 1,338,410 shares and 1,572,100 shares for the three months ended September 30, 2023 and 2022, respectively, and 1,279,130 shares and 1,442,599 shares for the nine months ended September 30, 2023 and 2022, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive.

Performance options to purchase 710,323 shares and 272,503 shares for the three months ended September 30, 2023 and 2022, respectively, and 605,483 shares and 121,778 shares for the nine months ended September 30, 2023 and 2022, respectively, were not included in the diluted earnings per share calculation because their effect would have been anti-dilutive.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

12 unchanged sentences

Risk Factors in our 2022 Form 10-K filed with the SEC, in addition to the following other factors, risks, trends and uncertainties:

 changes in macroeconomic conditions, including inflation, global supply chain challenges and instability in the banking system as a result of several recent regional bank failures, especially as they may affect existing home sales, interest rates, consumer confidence or labor availability;

 changes in macroeconomic conditions, including inflation and global supply chain challenges, especially as they may affect existing home sales, interest rates, consumer confidence or labor availability;

 increases in parts, appliance and home system prices, and other operating costs;

10 unchanged sentences

 risks related to the COVID-19 pandemic;

 risks related to geopolitical instability;

 compliance with, or violation of, laws and regulations, including consumer protection laws, or lawsuits or other claims by third parties, increasing our legal and regulatory expenses;

22 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements