CoStar Group(US:CSGP)2024-04-24 21:30Financial Performance - For the three months ended March 31, 2024, net income was $6.7 million, a decrease of 92.3% compared to $87.1 million for the same period in 2023[85]. - Total comprehensive income for the same period was $2.4 million, down from $91.2 million in the prior year, reflecting a significant decline[85]. - Revenues for Q1 2024 reached $656.4 million, a 12.3% increase from $584.4 million in Q1 2023[112]. - Gross profit for Q1 2024 was $515.2 million, compared to $465.2 million in Q1 2023, reflecting a gross margin improvement[112]. - Operating expenses totaled $558.0 million in Q1 2024, up from $393.0 million in Q1 2023, driven by increased selling and marketing expenses[112]. - Basic net income per share for Q1 2024 was $0.02, down from $0.22 in Q1 2023[112]. - Cash provided by operating activities was $139.6 million for Q1 2024, compared to $123.2 million in Q1 2023[93]. - Total revenues for the three months ended March 31, 2024, were $656.4 million, an increase of 12.3% compared to $584.4 million for the same period in 2023[209]. Cash and Liquidity - As of March 31, 2024, the company reported cash and cash equivalents of $4.8 billion, down from $5.1 billion as of December 31, 2023[39]. - Cash and cash equivalents at the end of Q1 2024 were $4,951.6 million, down from $5,055.7 million at the end of Q4 2023[93]. - The company reported a net cash used in investing activities of $380.3 million in Q1 2024, compared to $19.6 million in Q1 2023[93]. - The company’s cash and cash equivalents decreased from $5,215.9 million as of December 31, 2023, to $4,951.6 million as of March 31, 2024, a decline of approximately 5.1%[115]. Debt and Liabilities - The company’s total face amount of long-term debt remained stable at $1 billion as of March 31, 2024[29]. - Total liabilities increased from $1,581.1 million as of December 31, 2023, to $1,691.9 million as of March 31, 2024, an increase of approximately 7%[115]. - The company had $1.4 million of deferred debt issuance costs as of March 31, 2024, related to the 2020 Credit Agreement[30]. - Accounts payable surged from $23.1 million as of December 31, 2023, to $113.6 million as of March 31, 2024, indicating a significant increase in current liabilities[115]. Equity and Stock Performance - The balance of total stockholders' equity as of March 31, 2023, was $6,965.6 million, compared to $6,870.1 million at the end of 2022, indicating a growth of 1.4%[91]. - Total stockholders' equity remained relatively stable, increasing slightly from $7,338.6 million as of December 31, 2023, to $7,342.6 million as of March 31, 2024[115]. - The number of common shares outstanding as of April 22, 2024, was 408,342,326[53]. Tax and Regulatory Compliance - The effective tax rate for the three months ended March 31, 2024, was approximately 42%, an increase from 25% in the same period of 2023[45]. - The company has maintained compliance with all filing requirements under the Securities Exchange Act of 1934 for the past 90 days[52]. Acquisitions and Market Expansion - The company completed the acquisition of OnTheMarket in December 2023, enhancing its market presence in the UK[110]. - CoStar Group's acquisition of Business Immo was completed on April 5, 2022, enhancing its market presence in commercial real estate news services in France[58]. - The acquisition of OnTheMarket was completed for a total consideration of £96.0 million ($120.4 million), enhancing the company's market presence in the UK[190]. Revenue Recognition and Deferred Revenue - Subscription-based revenues accounted for approximately 96% of total revenues for the three months ended March 31, 2024, compared to 95% for the same period in 2023[125]. - Remaining contract consideration for which revenue has not been recognized due to unsatisfied performance obligations was approximately $394 million at March 31, 2024, expected to be recognized over the next five years[211]. - Total deferred revenue increased to $117.2 million as of March 31, 2024, up from $104.3 million at December 31, 2023, representing a growth of 8.3%[209]. - The company’s deferred revenue results from amounts billed in advance to customers, recognized as obligations are satisfied[154]. Goodwill and Impairment - The company’s goodwill as of March 31, 2024, was $2.3837 billion, reflecting a decrease from $2.3862 billion as of December 31, 2023[28]. - Goodwill is tested for impairment at least annually, with the assessment based on a projected discounted cash flow model that includes significant assumptions such as discount rate and growth rate[145]. Operational Developments - The company is continuing to develop its residential marketplaces, launching Homes.com memberships in February 2024 to promote agent profiles and listings[49]. - The company plans to expand its residential marketing investment to increase brand awareness and drive users to its website[49]. - The company continues to focus on expanding its online platforms, including Homes.com and Land.com, to enhance its service offerings in the real estate market[79]. - The company intends to build out space in the newly acquired office tower to support anticipated growth and expansion of operations[173]. Stock-Based Compensation - The company reported a total stock-based compensation expense of $22.8 million for the three months ended March 31, 2024, compared to $20.0 million for the same period in 2023, reflecting an increase of approximately 14%[136]. - The company recorded stock-based compensation expense for stock options and restricted stock awards, amounting to $0.8 million for the three months ended March 31, 2024[164].