CoStar Group (NasdaqGS:CSGP) FY Conference Transcript

CoStar Group FY Conference Summary Company Overview - Company: CoStar Group (NasdaqGS: CSGP) - Date of Conference: November 20, 2025 - Key Speakers: Chris Lown (CFO), Rich (Head of Investor Relations) Industry Insights Apartments Market - Growth: The apartments business has experienced 13 consecutive quarters of double-digit revenue growth, with a revenue increase from over $50 million to over $1.2 billion since acquisition over 10 years ago [5][6][7] - Market Position: CoStar is the market leader, significantly larger than its closest competitor, with a total addressable market (TAM) exceeding $9 billion [7][8] - Technology Integration: The introduction of Matterport Plus has enhanced customer experience, allowing virtual tours that lead to lower bounce rates and higher engagement [6][8][35] - Sales Strategy: A renewed focus on expanding the sales force by approximately 20% to better capture market opportunities [14][16] Competitive Landscape - Market Dynamics: CoStar faces competition primarily from Zillow and a few smaller players, but believes there is ample opportunity for growth due to low market penetration (15%-20%) [12][21] - Differentiation: CoStar emphasizes its technological edge and superior consumer experience as key differentiators in the market [12][13][21] AI and Technology - AI Integration: CoStar views AI as a transformative force in the industry, enhancing customer experience and operational efficiency [12][28][49] - Data Utilization: The company has over 2.4 trillion records, primarily proprietary, which provides a competitive advantage in data organization and analysis [46][47] Financial Performance - Revenue Growth: The apartments segment has shown consistent growth, with a focus on expanding into smaller property markets [5][21] - Sales Efficiency: The sales team is described as highly efficient, utilizing a metrics-focused approach to drive performance [19] Matterport Technology - Adoption Rates: 90% of users click on listings with Matterport, indicating its effectiveness in driving engagement [40][76] - B2B Strategy: CoStar is shifting its focus to a B2B model for Matterport, targeting larger clients rather than individual photographers [42] Homes Market - Unique Positioning: CoStar differentiates itself by focusing on helping listing agents and home sellers, rather than competing directly with buyer-focused platforms [52][53] - Subscriber Growth: The platform has over 26,000 subscribers and 130,000 paid listings, establishing itself as a market leader [56] Capital Allocation - Buyback Program: CoStar has accelerated its $500 million buyback program, indicating a strategic shift in capital allocation [78][79] Conclusion CoStar Group is positioned as a leader in the real estate technology space, with a strong focus on technology integration, market expansion, and capital efficiency. The company is leveraging AI and proprietary data to enhance its offerings and drive growth across its various platforms.