PART I FINANCIAL INFORMATION [Financial Statements](index=5&type=section&id=Item%201.%20Financial%20Statements) This section presents CoStar Group's unaudited condensed consolidated financial statements for the three and six months ended June 30, 2023, covering operations, balance sheets, cash flows, and accounting policies [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's H1 2023 financial performance, showing revenue growth, operating income decline, and net income increase Consolidated Statements of Operations (Six Months Ended June 30) | Financial Metric | 2023 (in thousands) | 2022 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | **Revenues** | $1,190,272 | $1,052,133 | 13% | | Gross Profit | $958,714 | $855,683 | 12% | | Selling and marketing | $476,260 | $325,341 | 46% | | **Income from operations** | $151,367 | $238,458 | -37% | | Interest income (expense), net | $95,459 | $(11,117) | NM | | **Net income** | $187,651 | $172,791 | 9% | | Net income per share - diluted | $0.46 | $0.44 | 4.5% | [Condensed Consolidated Balance Sheets](index=10&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2023, total assets increased to **$8.69 billion**, driven by higher cash, with total liabilities rising to **$1.59 billion** and equity growing to **$7.10 billion** Balance Sheet Summary | Account | June 30, 2023 (in thousands) | Dec 31, 2022 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $5,205,295 | $4,967,970 | | Total current assets | $5,444,884 | $5,185,867 | | Goodwill | $2,321,205 | $2,314,759 | | **Total assets** | **$8,691,674** | **$8,402,470** | | Total current liabilities | $442,775 | $372,615 | | Long-term debt, net | $989,858 | $989,210 | | **Total liabilities** | **$1,590,602** | **$1,532,349** | | **Total stockholders' equity** | **$7,101,072** | **$6,870,121** | [Condensed Consolidated Statements of Cash Flows](index=13&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations increased to **$298.4 million** in H1 2023, with cash and cash equivalents rising by **$237.3 million** overall Cash Flow Summary (Six Months Ended June 30) | Cash Flow Activity | 2023 (in thousands) | 2022 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $298,380 | $212,099 | | Net cash used in investing activities | $(54,422) | $(57,707) | | Net cash used in financing activities | $(6,270) | $(14,570) | | **Net increase in cash and cash equivalents** | **$237,325** | **$136,990** | [Notes to Condensed Consolidated Financial Statements](index=16&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes explain accounting policies and financial data, including revenue recognition, acquisitions, segment reporting, long-term debt, and goodwill - Subscription-based contracts are the primary revenue source, accounting for approximately **95%** of total revenues for the first six months of 2023[8](index=8&type=chunk) - The company operates in two segments: North America (U.S. and Canada) and International (Europe, Asia-Pacific, Latin America)[2](index=2&type=chunk) - Goodwill is tested for impairment annually or more frequently if indicators exist, with no impairments recognized during H1 2023[28](index=28&type=chunk)[233](index=233&type=chunk) Disaggregated Revenue by Service (Six Months Ended June 30, 2023) | Service | North America (in thousands) | International (in thousands) | Total (in thousands) | | :--- | :--- | :--- | :--- | | CoStar | $435,386 | $18,796 | $454,182 | | Information Services | $64,313 | $19,237 | $83,550 | | Multifamily | $434,988 | $0 | $434,988 | | LoopNet | $124,447 | $4,353 | $128,800 | | Residential | $25,861 | $0 | $25,861 | | Other Marketplaces | $62,891 | $0 | $62,891 | | **Total Revenues** | **$1,147,886** | **$42,386** | **$1,190,272** | Long-Term Debt (as of June 30, 2023) | Component | Amount (in thousands) | | :--- | :--- | | 2.800% Senior Notes due July 15, 2030 | $1,000,000 | | Senior Notes unamortized discount and issuance costs | $(10,142) | | **Long-term debt, net** | **$989,858** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=36&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses H1 2023 financial performance, noting revenue growth, operating income decline from marketing investments, and a strong **$5.2 billion** cash liquidity position [Overview and Services](index=36&type=section&id=Overview%20and%20Services) CoStar Group, a leading real estate information and marketplace provider, saw accelerated Multifamily revenue growth in H1 2023, while Residential revenue decreased - Multifamily (Apartments.com) revenue growth accelerated in H1 2023 due to higher sales volumes from increased pricing on renewals and more properties listed[79](index=79&type=chunk) - LoopNet revenue growth also accelerated due to an increase in the average price for listings[262](index=262&type=chunk) - Residential revenues decreased in H1 2023 due to the discontinuation of certain non-strategic products, a trend expected to continue for the full year[86](index=86&type=chunk)[81](index=81&type=chunk) [Development, Investments and Expansion](index=38&type=section&id=Development%2C%20Investments%20and%20Expansion) The company prioritizes significant investment in Homes.com, LoopNet expansion, and CoStar platform enhancements, expecting increased marketing costs and reduced operating income - Continuing to develop and invest heavily in the Homes.com residential marketplace, with plans to increase marketing investment to build website traffic[90](index=90&type=chunk) - Investing in LoopNet's sales capabilities and marketing to accelerate its revenue growth, including further brand expansion in Europe[267](index=267&type=chunk) - Enhancing the CoStar platform by adding analytics for commercial property investment funds and integrating STR benchmarking products[91](index=91&type=chunk)[268](index=268&type=chunk) [Results of Operations](index=45&type=section&id=Results%20of%20Operations) This section details H1 2023 operating results, with total revenues growing 13% to **$1.2 billion**, operating income falling 37% due to marketing, and net income increasing 9% Revenue by Service (Six Months Ended June 30) | Service | 2023 (in thousands) | 2022 (in thousands) | Change (%) | | :--- | :--- | :--- | :--- | | CoStar | $454,182 | $405,215 | 12% | | Multifamily | $434,988 | $357,836 | 22% | | LoopNet | $128,800 | $110,744 | 16% | | Residential | $25,861 | $38,214 | -32% | | **Total Revenues** | **$1,190,272** | **$1,052,133** | **13%** | - Selling and marketing expenses for H1 2023 increased by **$151 million** (46%), primarily due to a **$100 million** increase in marketing for residential brands and a **$45 million** increase in personnel and events costs[111](index=111&type=chunk)[114](index=114&type=chunk)[295](index=295&type=chunk) - North America EBITDA decreased **32%** to **$201 million** in H1 2023, while International EBITDA decreased **55%** to **$2 million**, both impacted by higher personnel and marketing costs[119](index=119&type=chunk) [Liquidity and Capital Resources](index=52&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$5.2 billion** in cash and equivalents and **$298 million** net cash from operations, with future capital needs for campus expansion - Cash and cash equivalents stood at **$5.2 billion** as of June 30, 2023, an increase from **$5.0 billion** at the end of 2022[120](index=120&type=chunk)[128](index=128&type=chunk) - The company is expanding its Richmond, VA campus, with total expected cash expenditures of approximately **$170 million** for 2023, and the project is expected to be substantially completed in 2025[124](index=124&type=chunk)[126](index=126&type=chunk) - Net cash provided by operating activities increased by **$86 million** to **$298 million** for the first six months of 2023 compared to the same period in 2022[129](index=129&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=57&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from foreign currency and interest rate changes, with 4% of H1 2023 revenues in foreign currencies and interest rate exposure from its **$5.2 billion** cash holdings - Approximately **4%** of H1 2023 revenues were foreign currency denominated; a 10% U.S. dollar strengthening would have increased revenues by about **$4.5 million**[317](index=317&type=chunk) - The company holds **$5.2 billion** in cash and cash equivalents, subject to interest rate risk that impacts interest income[304](index=304&type=chunk) - The company's **$1.0 billion** in Senior Notes are fixed-rate, and no amounts were outstanding under the **$750 million** variable-rate credit facility, minimizing current interest expense risk from rate changes[318](index=318&type=chunk) [Controls and Procedures](index=58&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were effective as of June 30, 2023, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of June 30, 2023[307](index=307&type=chunk) - No material changes were made to internal control over financial reporting during the most recent fiscal quarter[308](index=308&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=59&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in incidental litigation, but management does not expect any current lawsuit to materially affect its financial position or results - The company is not currently a party to any lawsuit or proceeding that is expected to have a material adverse effect on its financial position or results[310](index=310&type=chunk) [Risk Factors](index=59&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's 2022 Annual Report on Form 10-K - There have been no material changes to the risk factors as previously disclosed in the 2022 Form 10-K[323](index=323&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=59&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 9,834 common shares in Q2 2023 from employees for tax withholding on restricted stock vesting, not a public buyback Issuer Purchases of Equity Securities (Q2 2023) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 1-30, 2023 | 285 | $68.94 | | May 1-31, 2023 | 39 | $76.95 | | June 1-30, 2023 | 9,510 | $80.91 | | **Total** | **9,834** | **$80.55** |

CoStar Group, Inc. (NASDAQ:CSGP) Q1 2023 Earnings Conference Call April 25, 2023 5:00 PM ET Company Participants Cyndi Eakin - Head of Investor Relations Andy Florance - Founder & Chief Executive Officer Scott Wheeler - Chief Financial Officer Conference Call Participants George Tong - Goldman Sachs Peter Christiansen - Citi Stephen Sheldon - William Blair John Campbell - Stephens Ashish Sabadra - RBC Mayank Tandon - Needham Jeff Silber - BMO Heather Balsky - Bank of America Ryan Tomasello - KBW Operator Go ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Delaware 52-2091509 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) (202) 346-6500 (Registrant's telephone number, including area code) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sect ...

Financial Data and Key Metrics Changes - Total revenue for 2022 was $2.2 billion, representing a 12% year-over-year growth, coming in at the high end of guidance and above consensus estimates [29] - Fourth quarter revenue grew 13% on a constant currency basis, reaching $573 million, marking the 12th consecutive year of double-digit revenue growth [29] - Adjusted EBITDA for the full year was $672 million, exceeding the high end of guidance and consensus estimates, with a margin improvement of 300 basis points [31][74] Business Line Data and Key Metrics Changes - Apartments.com revenue was $198 million in Q4, a 16% increase year-over-year, and $740 million for the full year, a 10% increase [32] - CoStar revenue for 2022 was $837 million, up 16% from the previous year, with record net new sales [39] - LoopNet revenue for Q4 was $61 million, a 12% increase year-over-year, with net new sales bookings up 198% [42] Market Data and Key Metrics Changes - The U.S. multifamily vacancy rates rose to 7.1%, indicating a challenging environment for property owners [38] - The residential housing market is experiencing softness, with existing home sales down 38% over the past year due to rising mortgage rates [66] - The retail sector showed strong fundamentals, with a fourth quarter vacancy rate of 4.2%, the lowest recorded [65] Company Strategy and Development Direction - The company plans to continue investing in the residential market, particularly Homes.com, with expectations of strong returns similar to past investments in Apartments.com [17][91] - Expansion into Canada for Apartments.com was launched, targeting a $600 million Canadian apartment marketing opportunity [36] - The company aims to achieve 20% annual revenue growth, leveraging its strong brand and sales force [38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to navigate economic uncertainties, citing a resilient business model with high renewal rates and a strong balance sheet [72] - The company anticipates accelerating revenue growth in 2023, with a focus on its commercial information and marketplace businesses [75] - Management noted that the office sector continues to face challenges, but there are signs of recovery as office usage increases [63] Other Important Information - The company achieved a significant milestone by being included in the NASDAQ 100 and S&P 500, reflecting its consistent growth [67] - Employee engagement scores reached 83%, indicating a highly engaged workforce [69] - The company is committed to sustainability, with initiatives to reduce carbon emissions and improve transparency in human capital disclosures [68] Q&A Session Summary Question: Is it easier to find salespeople now compared to 6-12 months ago? - Management indicated that it is easier to find quality candidates due to a larger hiring stage and tightening in other sectors [3][4] Question: How have customer sales cycles changed? - The sales cycle for Apartments.com has shortened, while CoStar's sales cycle remains mixed due to the diverse sectors it serves [8] Question: What gives confidence in the residential business outperforming Apartments.com? - Management highlighted the larger market size and the company's growing experience in operating digital marketplaces as key factors [11][12]

Dividend Policy. We have never declared or paid any dividends on our common stock. We do not anticipate paying any dividends on our common stock during the foreseeable future, but intend to retain any earnings for future growth of our business. Overview The majority of our revenue is generated from service offerings that are distributed to our clients under subscription-based agreements that typically renew automatically and have a term of at least one year. We recognize subscription revenues on a straight- ...

CoStar Group, Inc. (NASDAQ:CSGP) Q3 2022 Earnings Conference Call October 25, 2022 5:00 PM ET Company Participants Cyndi Eakin - SVP, IR & Controller Andrew Florance - Founder, Director, President & CEO Scott Wheeler - CFO Conference Call Participants Peter Christiansen - Citigroup Jeffrey Meuler - Robert W. Baird & Co. Ryan Tomasello - KBW John Campbell - Stephens Ashish Sabadra - RBC Capital Markets Mayank Tandon - Needham & Company Stephen Sheldon - William Blair & Company George Tong - Goldman Sachs Ope ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number 0-24531 CoStar Group, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporati ...

CoStar Group, Inc. (NASDAQ:CSGP) Q2 2022 Earnings Conference Call July 26, 2022 5:00 PM ET Company Participants Cyndi Eakin – Senior Vice President of Investor Relations Andy Florance – Chief Executive Officer and Founder Scott Wheeler – Chief Financial Officer Conference Call Participants George Tong – Goldman Sachs Pete Christiansen – Citi Jeff Meuler – Baird Stephen Sheldon – William Blair Ryan Tomasello – KBW John Campbell – Stephens, Inc. Ashish Sabadra – RBC Gustavo Laguarda – Truist Mayank Tandon – N ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number 0-24531 CoStar Group, Inc. (Exact name of registrant as specified in its charter) Delaware 52-2091509 (State or other jurisdiction ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission file number 0-24531 CoStar Group, Inc. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation o ...