CoStar Group, Inc. (NASDAQ: CSGP) Q2 2025 Earnings | 07/23/2025

CoStar Group, Inc. (CoStar) announced strong financial results for Q2 2025, marking its 57th consecutive quarter of double-digit revenue growth. The company reported record net new bookings and significant growth across its various platforms, particularly Apartments.com and Homes.com, while also providing updates on strategic acquisitions and future outlook.

Q2 2025 Financial Performance

• Revenue: $781 million, a 15% increase year-over-year, exceeding guidance.

• Adjusted EBITDA: $85 million, an impressive 108% increase compared to Q2 2024, also surpassing guidance.

• Net New Bookings: A record $93 million, up 65% quarter-over-quarter and 38% year-over-year.

• Commercial Information and Marketplace Brands Margin: 43%.

• Cash Position: $3.7 billion in cash, with $33 million in net interest income.

• Share Repurchases: Repurchased 585,000 shares for $45 million in Q2, with plans for at least $150 million in repurchases for the year.

• Sales Force Expansion: Grew to 1,800 reps, an increase of over 400 since the beginning of the year and 43% year-over-year.

Segment Performance & Strategic Initiatives

Apartments.com:

• Revenue: $292 million, up 11% year-over-year.

• Net New Bookings: $45 million, a 20% year-over-year increase.

• Growth: Added 3,263 new rooftops in Q2, totaling 7,600 in the first half of 2025 (more than all of 2024).

• Sales Team: Expanding to 500 representatives in 2025.

• Marketing: Generated over 4.8 billion media impressions through a campaign across various channels including streaming video, paid social, digital, and live sports events.

• Traffic & Engagement: Averaged 42 million monthly unique visitors and 234 million network visits. Maintained 68% unaided awareness and delivered significantly more leads and leases than competitors.

• Technology: Launched a NYC-specific search experience, showcasing Matterport 3D tours and upcoming AI-powered voice search. Matterport views were up 193% year-over-year, leading to 23 times more leads.

• Canadian Business: Visits up 31%, leads up 62%, and paying properties grew 300% to over 1,500.

Homes.com:

• Sales Growth: Achieved solidly positive sales growth after initial Q1 churn.

• Residential Annualized Net New Bookings: $12 million.

• Revenue: Grew 8% compared to Q2 2024.

• Membership: Signed 6,300 net new members, a 56% increase.

• Traffic & Engagement: Attracted an average of 111 million unique monthly visitors. Unaided awareness grew from 4% (launch) to 36%.

• Client Satisfaction: Net Promoter Score (NPS) jumped to 38 in Q2 (from 3 in Q4 2024).

• Boost Product: Successfully launched, selling 1,270 boosts in Q2, with nearly 25% of users converting to full memberships.

• Marketing: Launched a new campaign celebrating over 100 million monthly unique visitors, featuring Dan Levy and Heidi Gartner.

• Zillow Competition: CoStar highlighted Zillow's "questionable" tactics (forcing immediate listing marketing) and offered free boosts to listings banned by Zillow.

• New Construction: Plans to launch a robust new home section on Homes.com, with 200 agreements already secured with leading builders.

CoStar Product (Commercial Information):

• Revenue: $271 million, accelerating to 7% year-over-year growth in Q2.

• Net New Bookings: Highest since Q3 2023.

• Sales Force: On track to increase by 20% in 2025, reaching 400 sales representatives.

• Lender Sales: Revenue approaching $100 million with over 400 clients.

• Renewal Rate: Increased to 93%.

• NPS: U.S. sales team reached 70%, Canadian team 63%.

• Subscribers: Grew to 275,000, up 19% year-over-year, driven by STR user migration.

• CRE Market: Office market remains challenging but shows signs of stabilization with sharp decline in new deliveries. Transaction volumes up 43% year-over-year, with office spiking 71%.

International Business (UK & Australia):

• UK Residential Marketplace (OnTheMarket): Inventory up 20% to 800,000 listings. Leads up 12%, page views up 28%. Net new bookings reached a record 100,000 in June.

• Domain Holdings (Australia): Final stages of acquisition, expected to close in Q3 2025. Investigation into primary competitor REA Group by the ACCC creates opportunity for Domain.

LoopNet:

• Net New Business: Generated more in H1 2025 than all of 2024 (up 345% year-over-year).

• Revenue Growth: Accelerated sequentially from Q1, up 8% year-over-year, expected to exceed 10% in H2 2025.

• Strategy: Focus on selling broad subscription packages and asset-based pricing yielding positive outcomes.

• Global Expansion: Launched in Spain, expected in France in Q4. Australia will become part of the LoopNet network post-Domain acquisition.

Matterport:

• Acquisition Rationale: CoStar believes integrating Matterport will accelerate growth and profitability.

• Strategy Shift: Shifting from product-led to B2B approach, focusing on Matterport Pro 3 camera.

• Sales Force Expansion: Plans to significantly expand Matterport's sales force by leveraging CoStar's existing sales teams.

• Product Development: Plans for more advanced cameras (Pro 4, Pro 4 Ultra) and making high-end cameras more accessible.

• VHT Divestiture: Winding down Matterport's loss-making photography business (VHT) to reallocate resources.

Outlook & Guidance

• Full-Year 2025 Revenue Guidance: Increased midpoint to $3.135 billion - $3.155 billion, implying 15% annual growth. This excludes the Domain acquisition.

• Q3 2025 Revenue Expectation: $800 million - $805 million, representing 16% year-over-year growth.

• Full-Year Adjusted EBITDA Guidance: Revised to $370 million - $390 million, reflecting Q2 outperformance and timing of growth investments shifting to H2.

• Q3 2025 Adjusted EBITDA Expectation: $75 million - $85 million.