Core Insights - Zillow Group reported revenue of $676 million for the quarter ended September 2025, reflecting a year-over-year increase of 16.4% and surpassing the Zacks Consensus Estimate of $668.99 million by 1.05% [1] - The company's EPS was $0.44, an increase from $0.35 in the same quarter last year, although it fell short of the consensus estimate of $0.45 by 2.22% [1] Financial Performance Metrics - Average Monthly Unique Users for Zillow's mobile applications and websites reached 250 million, exceeding the analyst estimate of 245.96 million [4] - Total visits to mobile applications and websites were 2.55 billion, surpassing the average estimate of 2.48 billion [4] - Residential revenue was reported at $435 million, above the analyst estimate of $429.27 million, marking a year-over-year increase of 7.4% [4] - Revenue from other segments was $14 million, slightly below the estimated $14.71 million, with no year-over-year change [4] - Mortgage revenue was $53 million, exceeding the average estimate of $50.02 million, representing a significant year-over-year increase of 35.9% [4] - Rental revenue reached $174 million, in line with the average estimate of $174.66 million, showing a year-over-year increase of 41.5% [4] Stock Performance - Zillow's shares have returned -3.3% over the past month, contrasting with the Zacks S&P 500 composite's increase of 3.6% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

Core Insights - Zillow Group reported quarterly earnings of $0.44 per share, missing the Zacks Consensus Estimate of $0.45 per share, but showing an increase from $0.35 per share a year ago, resulting in an earnings surprise of -2.22% [1] - The company posted revenues of $676 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.05% and increasing from $581 million year-over-year [2] - Zillow shares have underperformed the market, losing about 2.8% since the beginning of the year compared to the S&P 500's gain of 17.2% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.41 on revenues of $645.96 million, and for the current fiscal year, it is $1.67 on revenues of $2.57 billion [7] - The estimate revisions trend for Zillow was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Financial - Mortgage & Related Services industry, to which Zillow belongs, is currently in the top 39% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Insights - Zillow Group reported third-quarter earnings that surpassed analyst expectations, with adjusted EBITDA reaching $165 million [1] Company Performance - The third-quarter results indicate a strong performance by Zillow Group, reflecting effective management and strategic positioning in the housing market [1] Market Trends - CEO Jeremy Wacksman discussed the latest trends in the housing market during the earnings announcement, highlighting the company's insights into current market dynamics [1]

Core Insights - The article discusses the current trends and challenges in the real estate market, highlighting the impact of rising interest rates and inflation on property values and sales [1] Group 1: Market Trends - Rising interest rates have led to a slowdown in home sales, with a reported decrease of 15% year-over-year in some regions [1] - Inflation continues to affect construction costs, resulting in a 10% increase in material prices over the past year [1] Group 2: Investment Opportunities - Despite the challenges, certain markets are showing resilience, particularly in suburban areas where demand remains strong [1] - Real estate investment trusts (REITs) are adapting by focusing on sectors like logistics and healthcare, which are less sensitive to economic fluctuations [1]

Financial Performance - Total revenue for Q3 2025 was $676 million, a 16.3% increase from $581 million in Q3 2024[28] - Gross profit for Q3 2025 reached $491 million, compared to $441 million in Q3 2024, reflecting a 11.4% growth[28] - Net income for Q3 2025 was $10 million, a recovery from a net loss of $20 million in Q3 2024[30] - Total revenue for the three months ended September 30, 2025, was $676 million, an increase of 16% compared to $581 million for the same period in 2024[111] - Adjusted EBITDA for the three months ended September 30, 2025 was $165 million, a 30% increase from $127 million in the same period in 2024[137] - Total revenue for the nine months ended September 30, 2025 increased by $247 million, or 15%, to $1.9 billion[133] Revenue Breakdown - For Sale revenue from residential properties was $435 million in Q3 2025, up from $405 million in Q3 2024, marking a 7.4% increase[28] - Rentals revenue increased by $51 million, or 41%, to $174 million, driven by higher quarterly revenue per average monthly rentals unique visitor[111] - Residential revenue rose by $30 million, or 7%, to $435 million, attributed to increased visits and Residential revenue per visit[115] - Mortgages revenue increased by $14 million, or 36%, to $53 million, due to a rise in mortgage originations revenue from higher total loan origination volume[115] - Total loan origination volume for the three months ended September 30, 2025, was $1,281 million, a 56% increase from $819 million in the same period in 2024[128] Expenses and Costs - Total operating expenses for Q3 2025 were $494 million, slightly higher than $486 million in Q3 2024[28] - Cost of revenue increased by $45 million, or 32%, to $185 million for the three months ended September 30, 2025[142] - Cost of revenue increased by $97 million, or 25%, for the nine months ended September 30, 2025, primarily due to increases in lead acquisition costs and depreciation expenses[146] - Sales and marketing expenses rose by $50 million, or 9%, for the nine months ended September 30, 2025, driven by increases in headcount-related expenses[152] - Technology and development expenses increased by $17 million, or 4%, for the nine months ended September 30, 2025, primarily due to headcount-related expenses[155] Assets and Liabilities - Total current assets decreased to $2,119 million as of September 30, 2025, down from $2,334 million at the end of 2024[27] - Total liabilities decreased to $706 million as of September 30, 2025, compared to $981 million at the end of 2024[27] - Shareholders' equity increased to $4,992 million as of September 30, 2025, up from $4,848 million at the end of 2024[27] - Cash, cash equivalents, and restricted cash at the end of the period were $879 million, down from $1,075 million at the end of September 2024[34] Cash Flow - Net cash provided by operating activities was $296 million for the nine months ended September 30, 2025, slightly down from $306 million in 2024[34] - The company reported a net decrease in cash of $206 million during the period, compared to a decrease of $420 million in the prior year[34] - Adjusted free cash flow for the nine months ended September 30, 2025, was $295 million, compared to $231 million in the prior year[168] Share Repurchase and Equity - The company repurchased $438 million of Class A common stock and Class C capital stock during the nine months ended September 30, 2025[34] - Share repurchase authorizations increased to $3.5 billion, with $943 million remaining available for future repurchases as of September 30, 2025[73] - The company repurchased 4.7 million shares of Class A common stock and 1.4 million shares of Class C capital stock during the nine months ended September 30, 2025, for an aggregate purchase price of $438 million[187] Legal and Regulatory Matters - The company is involved in various legal proceedings, but management does not believe these will have a material effect on its financial position as of September 30, 2025[82] - The company is involved in various legal proceedings, including antitrust and intellectual property claims, which may increase as the business expands[209] Market Conditions and Risks - The company operates in a dynamic industry with significant risks including economic stability, interest rates, and regulatory changes[39] - Inflationary pressures have adversely impacted the number of transactions and demand for the company's services, affecting overall revenue[200] - Inflationary pressures may lead to increased costs in labor, marketing, and hosting, potentially affecting the company's financial condition[201] Miscellaneous - The company recorded an increase in unrecognized compensation cost related to unvested option awards totaling $197 million as of September 30, 2025[77] - The company does not maintain a significant balance of foreign currency, thus a 10% fluctuation in exchange rates is not expected to materially impact operations[202] - As of September 30, 2025, the company's disclosure controls and procedures were evaluated as effective by the CEO and CFO[203]

Revenue and Profit - Revenue for the three months ended September 30, 2025, was $676 million, a 16% increase from $581 million in the same period of 2024[3] - Gross profit for the nine months ended September 30, 2025, reached $1,439 million, up 12% from $1,289 million in 2024[3] - For Sale revenue for the twelve months ended September 30, 2025, was $1,856 million, reflecting a 10% increase from $1,682 million in 2024[7] - Net income for the nine months ended September 30, 2025, was $20 million, compared to a net loss of $60 million in the same period of 2024[5] - The company reported an Adjusted EBITDA of $165 million for the three months ended September 30, 2025, compared to $127 million in 2024, marking a 30% increase[3] Loan Origination and User Growth - Total loan origination volume for the three months ended September 30, 2025, was $1,281 million, a 56% increase compared to $819 million in 2024[8] - Average monthly unique users increased by 7% to 250 million in the three months ended September 30, 2025, from 233 million in 2024[6] Assets and Cash Position - Total assets as of September 30, 2025, were $5,698 million, a decrease from $5,829 million as of December 31, 2024[2] - Cash and cash equivalents at the end of the period were $879 million, down from $1,075 million at the end of September 2024[5] Operating Expenses - Total operating expenses for the three months ended September 30, 2025, were $494 million, slightly up from $486 million in 2024[3]

Core Insights - An increasing number of individuals are utilizing financing options through Zillow for home purchases [1] - A growing number of property managers are leveraging Zillow for rental listings [1] Group 1 - More people are buying homes using financing through Zillow [1] - More property managers are using the website for rental listings [1]

Core Insights - Mortgage rates are experiencing fluctuations, with the 30-year fixed mortgage rate increasing to 6.21% and the 15-year fixed rate decreasing to 5.40% [1][16] - The Federal Reserve's recent actions, including rate cuts, are influencing mortgage rates, but significant drops are not expected until at least the end of 2025 [13][17] Mortgage Rates Overview - Current mortgage rates include: - 30-year fixed: 6.21% - 20-year fixed: 5.81% - 15-year fixed: 5.40% - 5/1 ARM: 6.37% - 7/1 ARM: 6.29% - 30-year VA: 5.61% - 15-year VA: 5.08% [5] Refinance Rates - Refinance rates are generally higher than purchase rates, with the current 30-year fixed refinance rate at 6.35% [16] Economic Impact - Economists predict that mortgage rates will remain relatively stable through 2025, despite potential rate cuts from the Federal Reserve [17][18] - The CME FedWatch tool indicates a high probability of further rate cuts in the near future, which may influence mortgage rates [14]

Core Insights - Mortgage rates are currently mixed, with the average 30-year fixed mortgage rate at 6.09%, down four basis points, while the 15-year fixed rate increased by seven basis points to 5.44% [1][18][19] - The current rates are the lowest seen in over a year, suggesting it may be an opportune time for potential homebuyers [1] Current Mortgage Rates - The national average for various mortgage types includes: - 30-year fixed: 6.09% - 15-year fixed: 5.44% - 5/1 ARM: 6.22% [5][18] - These rates are rounded to the nearest hundredth and represent national averages [2][18] Refinance Rates - Mortgage refinance rates are generally higher than purchase rates, although this is not always the case [3] - Current refinance rates are also based on national averages rounded to the nearest hundredth [3] Monthly Payment Calculations - For a $300,000 mortgage at a 30-year term with a 6.09% rate, the monthly payment would be approximately $1,816, with total interest paid over the loan's life amounting to $353,777 [9] - For the same mortgage amount at a 15-year term with a 5.44% rate, the monthly payment would increase to $2,442, with total interest paid being $139,508 [11] Adjustable-Rate Mortgages (ARMs) - ARMs typically start with lower rates than fixed-rate mortgages but can increase after the initial fixed period [12][13] - The 5/1 ARM has a fixed rate for the first five years, after which it adjusts annually [12] Strategies for Lower Rates - To secure lower mortgage rates, borrowers should aim for higher down payments, excellent credit scores, and low debt-to-income ratios [15] - Options such as buying down the interest rate through discount points at closing can also be considered [16]

Core Insights - Zillow's September 2025 housing market report indicates an unexpected surge in real estate activity during a typically slow season, driven by a dip in mortgage rates and a strong stock market [1][4] - New listings increased by 3% year over year in September, reversing a 3% decline from the previous month, while monthly listings dipped by only 2%, outperforming the historical average of a 9% decline [1][2] Inventory and Market Dynamics - Total inventory decreased by 1% from August to September but is 14% higher than the same period last year [2] - The balance of power is shifting, with 15 of the 50 largest metropolitan areas now classified as buyer's markets, up from six last year [2] Buyer and Seller Markets - Zillow's heat index identifies the top buyer-friendly metropolitan areas, while seller-leaning markets remain competitive due to limited housing supply and restrictive land-use regulations [3] - The best seller's markets include major cities such as Miami, New Orleans, Austin, and San Francisco [6] Economic Indicators - The average 30-year fixed mortgage rate has dropped to approximately 6.19%, the lowest point of 2025, contributing to improved affordability [4] - Existing-home sales reached a seven-month high in September, indicating a potential thaw in the housing market rather than overheating [4][5] Future Outlook - Zillow's economists anticipate that the "unseasonably active" fall will extend into the holiday season, fueled by easing borrowing costs and pent-up demand [5] - This period may represent the first significant opportunity for buyers in nearly three years [5]