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Zillow Group Q3 Earnings Report

Note from the editor: This in-depth analysis first appeared on the GEM, Geek Estate’s private prop tech think tank. Interested in signing up and seeing these articles as soon as they are published? Click Here




Earnings Call Highlights

  • GAAP EPS of $.17, marking the first profitable quarter in 3 years
  • Non-GAAP EPS of $.39, beating consensus by 225% ($.12)
  • $656.6M Q3 reported revenue is 14.79% higher than $572M analyst expectation, but still down YoY
  • Reported EBITDA of $152.18M, beating estimates by 105%
  • Gross margin reported at 67.32%, in line with estimates
  • Housing business brought in $299M, up 24%
  • Ended Q3 with 665 homes in inventory, up from 440 in Q2
  • Apps and websites drew an average 236 million unique users this quarter, up 21% YoY
  • Management saw existing home sales climb to the highest level since 2006
  • Nearly two-thirds of Zillow Offers home purchases are closed digitally with a remote notary
  • Jacksonville, Florida was added to the Zillow Offers market which includes 25 other areas
  • “Zillow 2.0” will build upon existing relationships and provide adjacent services in the mortgages and Title and escrow areas 

Management Guidance

  • Q4 guidance revenue set between $709M to $748M, versus an initial market estimate of $682.9M
  • Adjusted EBITDA guidance set for $96.62M

Quotes from Rich Barton, Co-founder and CEO: 

  • “Instead of stretching and wrapping our lives to fit around where we work, we have been forced to find a way to wrap our work to fit around our lives.”
  • “The audience we built over the past 15 years is nearly double the size of our closest competitor and grew more than 30% in Q3.”

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