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Zillow Group Reports Strong Financial Performance

On May 7, 2025, Zillow Group, Inc. (NASDAQ: Z and ZG), a major player in the real estate digital marketplace, announced impressive financial outcomes for the first quarter of 2025. These results not only exceeded the company’s own expectations but have also positioned Zillow Group favorably for sustained growth in the upcoming quarters.

Financial Highlights

For the three-month period ending March 31, 2025, Zillow Group reported a consolidated revenue of $598 million, marking a significant year-over-year increase of 13%. This result notably surpassed the midpoint of the company’s revenue outlook by approximately $15 million. This growth is particularly noteworthy as it outperformed the overall residential real estate industry's year-over-year transaction value growth, which was estimated at just 3% according to the National Association of Realtors (NAR).

In-depth insights from the report indicated that the 'For Sale' revenue rose by 8% year-over-year to $458 million. Conversely, residential revenue grew by 6% to $417 million, owing predominantly to advancements in the company's Premier Agent offerings and Zillow Showcase. Interestingly, the mortgage segment witnessed a remarkable 32% rise in revenue, achieving $41 million as the company capitalized on a significant growth in purchase loan origination volumes.

Strategic Positioning

As part of the company's strategic plan, CEO Jeremy Wacksman remarked on how Zillow is effectively executing its growth strategies, indicating that Zillow is focused on expanding its services and solidifying its position as a comprehensive housing super app. He emphasized, "We are on track to meet our full-year 2025 goals, and we’re well-positioned to deliver sustainable profitable growth."

The rental segment also showed promising dynamics, with revenues soaring by 33% year-over-year, driven predominantly by a robust increase in multifamily housing revenue.

Adjusted EBITDA and Net Income

Zillow’s adjusted EBITDA reached $153 million, representing 26% of total revenue and showcasing the company’s ability to maintain cost discipline while expanding its operations. However, the net income stood at $8 million, translating to a 1% net income margin for the quarter.

Cash and investments at the end of the quarter stood at $1.6 billion, reflecting a decrease from the previous quarter, largely attributed to significant share repurchases totaling $250 million.

Traffic Growth

Notably, Zillow's digital ecosystem has expanded, seeing a 5% increase in average monthly unique users to 227 million across its mobile sites and applications. Total visits per month have also climbed to 2.4 billion, marking a 2% year-over-year increase. This growth in digital traffic is critical for fostering relationships with both customers and real estate professionals, further positioning Zillow Group as a leader in the residential real estate market.

Future Outlook

Going into Q2 2025, Zillow Group remains optimistic about its financial trajectory, continually innovating its offerings to enhance user experience and facilitate smoother buying, selling, and renting processes. The company has scheduled a live webcast for May 7, 2025, at 2 p.m. Pacific Time to delve deeper into the financial results and future projections, with further details available on its Investor Relations page.

Overall, Zillow Group's strong financial performance in Q1 serves as a promising indicator of its capability to sustain growth in a competitive market, thereby enhancing its core mission: making home a reality for more people. With continued focus on strategic advancements and maintaining profitability, Zillow is poised to navigate the complexities of the evolving real estate landscape effectively.