Strong net new bookings growth in CoStar,
LoopNet year-over-year
Apartments.com adds most properties in a
quarter since 2016
Homes.com continues to rapidly scale sales
force
CoStar Group, Inc. (NASDAQ: CSGP), a leading provider of online
real estate marketplaces, information, analytics and 3D digital
twin technology in the property markets, announced today that
revenue for the quarter ended March 31, 2025 was $732 million, up
12% over revenue of $656 million for the quarter ended March 31,
2024. Net loss was $15 million and net loss per diluted share was
$0.04 for the first quarter of 2025, which included a negative
impact of $31 million associated with the Matterport acquisition.
Adjusted EBITDA was $66 million in Q1 2025, an increase of 429%
from Q1 2024.
“CoStar Group delivered another strong quarter of results
achieving 12% year-over-year revenue growth in Q1 2025, our 56th
quarter of double-digit revenue growth as we met the top-end of our
revenue guidance and exceeded the top-end of our Adjusted EBITDA
guidance,” said Andy Florance Founder and Chief Executive Officer
of CoStar Group. “Once again, CoStar Group's commercial information
and marketplace brands1 delivered exceptional results with a 43%
profit margin for Q1 2025. We are gaining sales momentum across the
board. In Q1 2025, our commercial real estate businesses, CoStar
and LoopNet, had very strong annualized net new bookings with
CoStar up 68% year-over-year, the highest level since Q3 2023 and
LoopNet generating an impressive 200% increase year-over-year,
which was LoopNet’s highest level since Q3 2022. In Q1 2025,
Apartments.com added 4,300 properties, the most properties in one
quarter since Q1 2016. Today, our dedicated Homes.com salesforce
has grown to 370 representatives and we believe we will be at 500
sales reps by the end of June, as we continue to gain sales
momentum. In April, Homes.com's demo-to-close rate increased to
over 50%, the highest ever by any CoStar Group sales team. This
demonstrates the strong demand for Homes.com.”
Florance continued, “In one year, the Homes.com Network has
become the second largest in the industry in the United States,
with 104 million average monthly unique visitors 2. In Q1 2025,
unaided consumer awareness grew to 36% up from just 4% before the
February 2024 launch. Importantly, Member agents are winning 61%
more listings than comparable non-Member agents3. Our Net Promoter
Score has risen 85 points since May 2024 to 43 today.”
“We completed the Matterport acquisition in February 2025,” said
Florance. “Matterport is the best way to present physical real
estate spaces online and transform them into data. There are
valuable applications for every type of real estate, and we plan to
deploy Matterport across CoStar Group and meaningfully expand this
unique data set.”
___________________________________________
1 References to “commercial information
and marketplace brands” refer to our consolidated financial
position and results excluding the impact of Homes.com, OnTheMarket
and Matterport.
2 Based on: (1) the Homes.com Network
(which includes Homes.com, the Apartments Network, and the Land
Network) average monthly unique visitors (104 million) for the
quarter ended March 31, 2025, according to Google Analytics, and
(2) Realtor.com’s average monthly unique users (62 million) of
Realtor.com’s web and mobile sites according to internal data, for
the quarter ended December 31, 2024, as reported in News Corp’s
press release on February 5, 2025, (3) Redfin’s monthly average
visitors (42.68 million) for the quarter ended December 31, 2024,
according to Google Analytics, as reported in Redfin’s Form 10-K
filed on February 27, 2025 and (4) Zillow Group’s average
monthly unique users (204 million) for the quarter ended December
31, 2024, as reported in Zillow Group’s shareholder letter dated
February 11, 2025.
3Based on CoStar Group’s internal analysis
comparing Members to non-Members on Homes.com.
Year 2024-2025 Quarterly
Results - Unaudited
(in millions, except per share
data)
2024
2025
Q1
Q2
Q3
Q4
Q1
Revenues
$656
$678
$693
$709
$732
Net income (loss)
7
19
53
60
(15)
Net income (loss) per share - diluted
0.02
0.05
0.13
0.15
(0.04)
Weighted average outstanding shares -
diluted
407
407
408
408
411
EBITDA
(13)
12
51
73
(1)
Adjusted EBITDA
12
41
76
112
66
2025 Outlook
“This quarter, we delivered strong revenue growth and adjusted
EBITDA growth as we met the top end of our revenue guidance and
exceeded the top-end of our Adjusted EBITDA guidance,” said
Christian Lown, CFO of CoStar Group. The Company now expects
revenue in the range of $3.115 billion to $3.155 billion for the
full year 2025, representing revenue growth of approximately 15%
year-over-year at the midpoint of the range. The Company expects
revenue for the second quarter of 2025 in the range of $770 million
to $775 million, representing revenue growth of approximately 14%
year-over-year at the midpoint of the range.
"With the inclusion of Matterport, we now expect adjusted EBITDA
for the full year of 2025 in the range of $355 million to $385
million, a margin of 12% at the midpoint of the range. For the
second quarter of 2025, we expect adjusted EBITDA in the range of
$50 million to $60 million."
The preceding forward-looking statements reflect CoStar Group’s
expectations as of April 29, 2025, including forward-looking
non-GAAP financial measures on a consolidated basis, based on
current estimates, expectations, observations, and trends. Given
the risk factors, rapidly evolving economic environment, and
uncertainties and assumptions discussed in this release and in our
quarterly reports on Form 10-Q and annual reports on Form 10-K,
actual results may differ materially. Other than in publicly
available statements, the Company does not intend to update its
forward-looking statements until its next quarterly results
announcement.
Reconciliations of EBITDA and adjusted EBITDA to the most
directly comparable GAAP measures are shown in detail below, along
with definitions for those terms. A reconciliation of
forward-looking non-GAAP guidance to the most directly comparable
GAAP measure, net income, can be found within the tables included
in this release.
Non-GAAP Financial Measures
For information regarding the purpose for which management uses
the non-GAAP financial measures disclosed in this release and why
management believes they provide useful information to investors
regarding the Company’s financial condition and results of
operations, please refer to the Company’s latest periodic
report.
EBITDA is a non-GAAP financial measure that represents GAAP net
income attributable to CoStar Group before interest income or
expense, net and other income or expense, net; loss on debt
extinguishment; income taxes and depreciation and amortization
expense.
Adjusted EBITDA is a non-GAAP financial measure that represents
EBITDA before stock-based compensation expense; acquisition- and
integration-related costs; restructuring and related costs; and
settlements and impairments incurred outside the Company’s ordinary
course of business. Adjusted EBITDA margin represents adjusted
EBITDA divided by revenues for the period.
Operating Metrics
Net new bookings is calculated based on the annualized amount of
change in the Company's sales bookings resulting from new
subscription-based contracts, changes to existing
subscription-based contracts and cancellations of
subscription-based contracts for the period reported. Information
regarding net new bookings is not comparable to, nor should it be
substituted for, an analysis of the Company's revenues over
time.
Earnings Conference Call
Management will conduct a conference call to discuss the first
quarter 2025 results and the Company’s outlook at 5:00 PM ET on
Tuesday, April 29, 2025. A live audio webcast of the conference
will be available in listen-only mode through the Investors section
of the CoStar Group website: https://investors.costargroup.com. A
replay of the webcast audio will also be available in the Investors
section of our website for a period of time following the call.
CoStar Group, Inc.
Condensed Consolidated
Statements of Operations - Unaudited
(in millions, except per share
data)
Three Months Ended
March 31,
2025
2024
Revenues
$
732.2
$
656.4
Cost of revenues
153.3
141.2
Gross profit
578.9
515.2
Operating expenses:
Selling and marketing (excluding customer
base amortization)
368.9
366.1
Software development
94.5
82.4
General and administrative
141.1
98.5
Customer base amortization
17.2
11.0
621.7
558.0
Loss from operations
(42.8
)
(42.8
)
Interest income, net
38.5
56.2
Other expense, net
(2.4
)
(1.9
)
(Loss) income before income taxes
(6.7
)
11.5
Income tax expense
8.1
4.8
Net (loss) income
$
(14.8
)
$
6.7
Net (loss) income per share - basic
$
(0.04
)
$
0.02
Net (loss) income per share - diluted
$
(0.04
)
$
0.02
Weighted-average outstanding shares -
basic
410.5
405.6
Weighted-average outstanding shares -
diluted
410.5
407.3
CoStar Group, Inc.
Reconciliation of Non-GAAP
Financial Measures - Unaudited
(in millions)
Reconciliation of Net (Loss)
Income to EBITDA and Adjusted EBITDA
Three Months Ended
March 31,
2025
2024
Net (loss) income
$
(14.8
)
$
6.7
Amortization of acquired intangible assets
in cost of revenues
10.5
8.8
Amortization of acquired intangible assets
in operating expenses
17.2
11.0
Depreciation and other amortization
14.3
10.3
Interest income, net
(38.5
)
(56.2
)
Other expense, net (1)
2.4
1.9
Income tax expense
8.1
4.8
EBITDA(2)
$
(0.8
)
$
(12.7
)
Stock-based compensation expense
30.4
22.8
Acquisition and integration related
costs
20.6
2.3
Restructuring and related costs
7.1
—
Settlements and impairments
8.3
—
Adjusted EBITDA(2)
$
65.6
$
12.4
__________________________
(1) Includes $5.0 million and $5.5 million
of amortization and depreciation expense including above-market
lease amortization associated with lessor activities for the three
months ended March 31, 2025 and 2024, respectively.
(2) Totals may not foot due to
rounding.
CoStar Group, Inc.
Condensed Consolidated Balance
Sheets - Unaudited
(in millions)
March 31, 2025
December 31,
2024
ASSETS
Current assets:
Cash and cash equivalents
$
3,680.8
$
4,681.0
Restricted cash
97.4
—
Equity investment
285.6
—
Accounts receivable
232.3
210.7
Less: Allowance for credit losses
(25.3
)
(22.8
)
Accounts receivable, net
207.0
187.9
Prepaid expenses and other current
assets
82.5
81.3
Total current assets
4,353.3
4,950.2
Deferred income taxes, net
49.8
30.6
Property and equipment, net
1,097.6
1,014.9
Lease right-of-use assets
96.7
103.0
Goodwill
3,673.2
2,527.6
Intangible assets, net
957.2
433.2
Deferred commission costs, net
173.9
169.6
Deposits and other assets
26.4
27.7
Total assets
$
10,428.1
$
9,256.8
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable
$
38.7
$
47.0
Accrued wages and commissions
96.5
133.3
Accrued expenses
235.9
163.7
Litigation accrual
95.0
—
Income taxes payable
28.5
23.2
Lease liabilities
28.2
32.0
Deferred revenue
181.4
137.1
Other current liabilities
20.2
16.0
Total current liabilities
724.4
552.3
Long-term debt, net
992.2
991.9
Deferred income taxes, net
7.9
7.6
Income taxes payable
26.1
25.0
Lease and other long-term liabilities
121.3
126.5
Total liabilities
1,871.9
1,703.3
Total stockholders' equity
8,556.2
7,553.5
Total liabilities and stockholders'
equity
$
10,428.1
$
9,256.8
CoStar Group, Inc.
Condensed Consolidated
Statements of Cash Flows - Unaudited
(in millions)
Three Months Ended
March 31,
2025
2024
Operating activities:
Net (loss) income
$
(14.8
)
$
6.7
Adjustments to reconcile net (loss) income
to net cash provided by operating activities:
Depreciation and amortization
47.3
33.3
Amortization of deferred commissions
costs
31.0
27.2
Amortization of Senior Notes discount and
issuance costs
0.6
0.6
Non-cash lease expense
8.4
8.3
Stock-based compensation expense
30.4
22.8
Deferred income taxes, net
(0.5
)
(2.8
)
Credit loss expense
9.4
7.9
Other operating activities, net
(3.4
)
0.1
Changes in operating assets and
liabilities, net of acquisitions:
Accounts receivable
(15.7
)
(15.6
)
Prepaid expenses and other current
assets
7.2
2.2
Deferred commissions
(34.3
)
(38.7
)
Accounts payable and other liabilities
(22.1
)
77.2
Lease liabilities
(9.8
)
(8.1
)
Income taxes payable, net
6.7
5.4
Deferred revenue
12.8
13.1
Net cash provided by operating
activities
53.2
139.6
Investing activities:
Proceeds from sale and settlement of
investments
203.4
—
Proceeds from sale of property and
equipment and other assets
0.1
—
Purchases of property, equipment, and
other assets for new campuses
(53.7
)
(376.7
)
Purchases of property, equipment, and
other assets
(25.5
)
(3.6
)
Purchases of equity securities
(284.8
)
—
Cash paid for acquisitions, net of cash
acquired
(750.1
)
—
Net cash used in investing activities
(910.6
)
(380.3
)
Financing activities:
Repurchase of restricted stock to satisfy
tax withholding obligations
(34.7
)
(26.0
)
Stock repurchase
(18.5
)
—
Proceeds from exercise of stock options
and employee stock purchase plan
6.6
4.6
Principal repayments of financing lease
obligations
(0.7
)
—
Other financing activities
—
(1.1
)
Net cash used in financing activities
(47.3
)
(22.5
)
Effect of foreign currency exchange rates
on cash, cash equivalents, and restricted cash
1.9
(1.1
)
Net decrease in cash, cash equivalents,
and restricted cash
(902.8
)
(264.3
)
Cash, cash equivalents, and restricted
cash at the beginning of period
4,681.0
5,215.9
Cash, cash equivalents, and restricted
cash at the end of period
$
3,778.2
$
4,951.6
CoStar Group, Inc.
Disaggregated Revenues -
Unaudited
(in millions)
Three Months Ended March
31,
2025
2024
North America
International
Total
North America
International
Total
CoStar
$
247.6
$
17.5
$
265.1
$
235.7
$
14.6
$
250.3
Information Services
36.0
3.8
39.8
27.4
5.6
33.0
Multifamily
282.5
—
282.5
254.8
—
254.8
LoopNet
70.0
2.8
72.8
66.4
2.7
69.1
Residential
16.5
10.7
27.2
8.4
10.2
18.6
Other Revenues
44.8
—
44.8
30.6
—
30.6
Total revenues
$
697.4
$
34.8
$
732.2
$
623.3
$
33.1
$
656.4
CoStar Group, Inc.
Results of Segments -
Unaudited
(in millions)
Three Months Ended
March 31,
2025
2024
EBITDA
North America
$
9.1
$
3.2
International
(9.9
)
(15.9
)
Total EBITDA
$
(0.8
)
$
(12.7
)
CoStar Group, Inc.
Reconciliation of Non-GAAP
Financial Measures with Quarterly Results - Unaudited
(in millions)
Reconciliation of Net (Loss)
Income to EBITDA and Adjusted EBITDA
2024
2025
Q1
Q2
Q3
Q4
Q1
Net income (loss)
$6.7
$19.2
$53.0
$59.8
$(14.8)
Amortization of acquired intangible
assets
19.8
18.1
16.5
19.8
27.7
Depreciation and other amortization
10.3
10.1
10.6
13.1
14.3
Interest income, net
(56.2)
(53.5)
(55.6)
(47.2)
(38.5)
Other expense, net (1)
1.9
1.5
1.6
2.2
2.4
Income tax expense
4.8
16.7
24.7
25.2
8.1
EBITDA(2)
$(12.7)
$12.1
$50.8
$72.9
$(0.8)
Stock-based compensation expense
22.8
22.7
21.8
21.8
30.4
Acquisition and integration related
costs
2.3
6.0
4.4
16.7
20.6
Restructuring and related costs
—
—
0.2
0.5
7.1
Settlements and impairments
—
—
(1.3)
—
8.3
Adjusted EBITDA(2)
$12.4
$40.8
$75.9
$111.9
$65.6
__________________________
(1) Includes $5.0 million and $5.5 million
of amortization and depreciation expense including above-market
lease amortization associated with lessor activities for the three
months ended March 31, 2025 and 2024, respectively.
(2) Totals may not foot due to
rounding.
CoStar Group, Inc.
Reconciliation of
Forward-Looking Guidance - Unaudited
(in millions)
Reconciliation of
Forward-Looking Guidance, Net (Loss) Income to Adjusted
EBITDA
Guidance Range
Guidance Range
For the Three Months
For the Year Ending
Ending June 30, 2025
December 31, 2025
Low
High
Low
High
Net (loss) income
$
(27.0
)
$
(18.0
)
$
29.0
$
46.0
Amortization of acquired intangible
assets
43.0
43.0
155.0
155.0
Depreciation and other amortization
13.0
13.0
55.0
55.0
Interest income, net
(32.0
)
(32.0
)
(130.0
)
(130.0
)
Other expense, net
2.0
2.0
8.0
8.0
Income tax (benefit) expense
(4.0
)
(3.0
)
22.0
35.0
Stock-based compensation expense
49.0
49.0
174.0
174.0
Acquisition and integration related
costs
3.0
3.0
24.0
24.0
Settlements and impairments
1.0
1.0
9.0
9.0
Restructuring and related costs
2.0
2.0
9.0
9.0
Adjusted EBITDA
$
50.0
$
60.0
$
355.0
$
385.0
About CoStar Group
CoStar Group (NASDAQ: CSGP) is a global leader in commercial
real estate information, analytics, online marketplaces and 3D
digital twin technology. Founded in 1986, CoStar Group is dedicated
to digitizing the world’s real estate, empowering all people to
discover properties, insights, and connections that improve their
businesses and lives.
CoStar Group’s major brands include CoStar, a leading global
provider of commercial real estate data, analytics, and news;
LoopNet, the most trafficked commercial real estate marketplace;
Apartments.com, the leading platform for apartment rentals; and
Homes.com, the fastest-growing residential real estate marketplace.
CoStar Group’s industry-leading brands also include Matterport, a
leading spatial data company whose platform turns buildings into
data to make every space more valuable and accessible, STR, a
global leader in hospitality data and benchmarking, Ten-X, an
online platform for commercial real estate auctions and negotiated
bids and OnTheMarket, a leading residential property portal in the
United Kingdom.
CoStar Group’s websites attracted over 130 million average
monthly unique visitors in the first quarter of 2025, serving
clients around the world. Headquartered in Arlington, Virginia,
CoStar Group is committed to transforming the real estate industry
through innovative technology and comprehensive market
intelligence. From time to time, we plan to utilize our corporate
website as a channel of distribution for material company
information. For more information, visit CoStarGroup.com.
This news release and the Company’s earnings conference call
contain “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements
include, but are not limited to, statements about CoStar Group's
plans, objectives, expectations, beliefs and intentions and other
statements including words such as “hope,” “anticipate,” “may,”
“likely,” “might,” “believe,” “expect,” “observe,” “consider”,
“think,” “intend,” “envision,” “will,” “should,” “could”, “would,”
“plan,” “target,” “goal,” “estimate,” “predict,” “continue,”
“commit,” and “potential” or the negative of these terms or other
comparable terminology. . Such statements are based upon the
current beliefs and expectations of management of CoStar Group and
are subject to many risks and uncertainties. Actual results may
differ materially from the results anticipated in the
forward-looking statements and the assumptions and estimates used
as a basis for the forward-looking statements. The following
factors, among others, could cause or contribute to such
differences: our inability to attract and retain new clients; our
inability to successfully develop and introduce new or updated
online marketplace services, information, and analytics; our
inability to compete successfully against existing or future
competitors in attracting advertisers and in general; the effects
of fluctuations and market cyclicality; the effects of global
economic uncertainties and downturns or a downturn or consolidation
in the real estate industry; our inability to hire qualified
persons for, or retain and continue to develop our sales force, or
unproductivity of our sales force; our inability to retain and
attract highly capable management and operating personnel; the
downward pressure that our internal and external investments may
place on our operating margins; our inability to increase brand
awareness; our inability to maintain or increase internet traffic
to our marketplaces, and the risk that the methods, including
Google Analytics, that we use to measure average monthly unique
visitors to our portals may misstate the actual number of unique
persons who visit our network of mobile applications and websites
for a given month or may differ from the methods used by
competitors; our inability to attract new advertisers; our
inability to successfully identify, finance, integrate, and/or
manage costs related to acquisitions; our inability to complete
certain strategic transactions if a proposed transaction is subject
to review or approval by regulatory authorities pursuant to
applicable laws or regulations; our inability to realize the
benefits of the acquisition of Matterport; the effects of
cyberattacks and security vulnerabilities, and technical problems
or disruptions; the significant costs associated with undertaking a
large infrastructure project to build out our campus in Richmond,
Virginia; our inability to generate increased revenues from our
current or future geographic expansion plans; the risks related to
acceptance of credit cards and debit cards and facilitation of
other customer payments; the effects of climate related events and
other events beyond our control; the effects related to attention
to environmental, social and governance matters; our inability to
obtain and maintain accurate, comprehensive, or reliable data; our
inability to obtain and maintain stable data feeds, or disruption
of our data feeds; our inability to enforce or defend our ownership
and use of intellectual property; the effects of use of new and
evolving technologies, including artificial intelligence, on our
ability to protect our data and intellectual property from
misappropriation by third parties; our inability to defend against
potential legal liability for collecting, displaying, or
distributing information; our inability to obtain or retain
listings from real estate brokers, agents, property owners, and
apartment property managers; our inability to maintain or establish
relationships with third-party listing providers; our inability to
comply with the rules and compliance requirements of Multiple
Listing Services; the risks related to international operations;
the effects of foreign currency exchange rate fluctuations; our
indebtedness; the effects of a lowering or withdrawal of the
ratings assigned to our debt securities by rating agencies; the
effects of any actual or perceived failure to comply with privacy
laws and standards; the effects of changes in tax laws,
regulations, or fiscal and tax policies; the effects of third-party
claims, litigation, regulatory proceedings, or government
investigations; and risks related to return on investment. More
information about potential factors that could cause results to
differ materially from those anticipated in the forward-looking
statements include, but are not limited to, those stated in CoStar
Group’s filings from time to time with the Securities and Exchange
Commission (the "SEC"), including in CoStar Group’s Annual Reports
on Form 10-K and Quarterly Reports on Form 10-Q, each of which is
filed with the SEC, including in the “Risk Factors” section of
those filings, as well as CoStar Group’s other filings with the SEC
(including Current Reports on Form 8-K) available at the SEC’s
website (www.sec.gov). All forward-looking statements are based on
information available to CoStar Group on the date hereof, and
CoStar Group assumes no obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by appliable
law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250429388378/en/
Investor Relations: Rich Simonelli Head of Investor
Relations CoStar Group Investor Relations (202) 346-6784
getrich@costar.com
News Media: Matthew Blocher Vice President CoStar Group
Corporate Marketing & Communications (202) 346-6775
mblocher@costar.com
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