CoStar Group ((CSGP)) has held its Q3 earnings call. Read on for the main highlights of the call.
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The recent earnings call for CoStar Group conveyed a generally positive sentiment, highlighting robust revenue and EBITDA growth, successful AI integration, and beneficial impacts from recent acquisitions. However, the company is navigating challenges related to market competition, including legal issues faced by Zillow, and some seasonal impacts on bookings.
Strong Revenue Growth
CoStar Group reported impressive revenue figures for the third quarter of 2025, achieving $834 million, which represents a 20% increase year-over-year. This marks the 58th consecutive quarter of double-digit revenue growth, underscoring the company’s consistent financial performance.
Significant EBITDA Increase
The company also saw a substantial rise in adjusted EBITDA, which climbed to $115 million in Q3 2025, marking a 51% increase over the previous year. The commercial information and marketplaces brand achieved a notable margin of 47%, reflecting efficient operational management.
Residential Portals Revenue Growth
Residential portals, including Apartments.com, demonstrated strong performance with a 22.7% quarter-over-quarter and 31.3% year-over-year revenue growth. Apartments.com alone contributed $303 million in Q3 revenue, marking an 11% increase year-over-year.
Homes.com Performance
Homes.com showed remarkable growth, with net new annualized bookings increasing by 1,225% year-over-year and a 53% quarter-over-quarter growth in net new bookings, indicating a strong market presence and user engagement.
AI Integration Success
The integration of AI technologies, particularly the launch of AI Smart Search on Homes.com, has enhanced user engagement significantly, with users submitting 51% more leads after viewing a listing page.
Domain Acquisition Impact
The acquisition of Domain contributed $25 million in revenue from late August to the end of September, with notable audience growth and product improvements in Australia, highlighting the strategic value of this acquisition.
Zillow Legal Challenges
Zillow, a competitor, is currently facing multiple lawsuits, including allegations of antitrust violations and copyright theft, as well as a class-action lawsuit over deceptive practices, which could impact its market position.
Seasonal Trends Impact
Despite an increased sales force, CoStar experienced a 10% sequential decline in bookings, suggesting potential seasonal impacts on their business operations.
Forward-Looking Guidance
Looking ahead, CoStar Group maintains a positive outlook, projecting full-year revenue to be between $3.23 billion and $3.24 billion, with adjusted EBITDA expected to range from $415 million to $425 million. The company anticipates continued growth, driven by its commercial information and marketplace businesses, as well as its residential real estate portals.
In conclusion, CoStar Group’s earnings call reflected a strong financial performance with significant growth in revenue and EBITDA. The company’s strategic initiatives, including AI integration and acquisitions, have positively impacted its operations. While challenges such as market competition and seasonal trends exist, CoStar’s forward-looking guidance remains optimistic, indicating a promising future trajectory.