Zillow Group (NASDAQ:Z) Posts Quarterly Earnings Results

Key Points

• Zillow exceeded Q2 expectations: Revenue rose 18% year over year to $772 million, while adjusted earnings per share reached $0.52 versus the $0.45 consensus estimate. Rentals and mortgages were particularly strong, with revenue growth of 31% and 75%, respectively.
• AI and integrated services are boosting engagement: Zillow AI users spend more than three times as long on the platform and contact agents at nearly three times the rate of non-users. Zillow Preferred also generates 23% more revenue per connection than its legacy model.
• Near-term pressure remains: Third-quarter revenue guidance of $745 million to $760 million fell below analyst expectations, while the transition to Zillow Preferred is expected to weigh on fourth-quarter For Sale revenue growth. The company is also cutting about 7% of its workforce to generate annualized EBITDA savings.

Zillow Group (NASDAQ:Z - Get Free Report) released its quarterly earnings results on Wednesday. The financial services provider reported $0.52 earnings per share for the quarter, beating analysts' consensus estimates of $0.45 by $0.07, FiscalAI reports. The company had revenue of $772.00 million for the quarter, compared to analysts' expectations of $758.10 million. Zillow Group had a return on equity of 1.41% and a net margin of 2.27%.

Here are the key takeaways from Zillow Group's conference call:

• Q2 results exceeded expectations: Revenue rose 18% year over year to $772 million, EBITDA reached $176 million, and adjusted net income was $118 million. Zillow generated $223 million in year-to-date free cash flow and raised no changes to its full-year revenue outlook of $2.92 billion to $2.96 billion.
• AI and integrated experiences are driving engagement: Users of Zillow AI mode spend more than three times as long on the platform and contact agents at nearly three times the rate of non-users; AI mode is now available to about 20% of signed-in users. Zillow also reported that Zillow Preferred generates 23% more revenue per connection than its legacy model, with the premium expected to reach 35% by year-end.
• Rentals and mortgages delivered strong growth: Rentals revenue increased 31%, multifamily revenue rose 42%, and multifamily properties on the platform grew to 79,000. Mortgages revenue jumped 75%, while purchase loan origination volume increased 95% year over year.
• The Preferred transition will create near-term revenue headwinds: Zillow expects more than 75% of connections to flow through Preferred by the end of 2026, but the shift in revenue recognition, mortgage origination timing, and seasonality is expected to pressure fourth-quarter For Sale revenue growth by 400–600 basis points. Residential revenue is expected to be flat in Q3 and roughly in line with purchase-mortgage industry growth for the full year.
• Zillow eliminated approximately 7% of its workforce, expecting $75 million in annualized EBITDA savings and $140 million including previously planned hiring reductions. The company said the restructuring is intended to improve efficiency without affecting its core growth initiatives, while also consolidating the COO and CFO roles under Jeremy Hofmann.

Zillow Group Stock Performance

Shares of Z stock traded down $2.67 during trading on Thursday, hitting $33.43. 11,500,317 shares of the company were exchanged, compared to its average volume of 4,249,842. The business's 50-day simple moving average is $33.12 and its 200 day simple moving average is $41.84. Zillow Group has a twelve month low of $29.23 and a twelve month high of $93.88. The firm has a market capitalization of $7.65 billion, a price-to-earnings ratio of 133.72, a P/E/G ratio of 1.55 and a beta of 1.98.

Analysts Set New Price Targets

Several analysts have weighed in on the company. UBS Group cut their target price on Zillow Group from $80.00 to $75.00 and set a "buy" rating on the stock in a research note on Tuesday, April 28th. Jefferies Financial Group cut their price objective on shares of Zillow Group from $75.00 to $60.00 and set a "buy" rating on the stock in a research note on Tuesday, July 14th. Deutsche Bank Aktiengesellschaft decreased their target price on shares of Zillow Group from $80.00 to $68.00 and set a "buy" rating for the company in a research report on Friday, May 8th. Zacks Research downgraded shares of Zillow Group from a "strong-buy" rating to a "hold" rating in a research report on Tuesday. Finally, Royal Bank Of Canada lowered their price objective on shares of Zillow Group from $95.00 to $70.00 and set an "outperform" rating on the stock in a research note on Wednesday, June 10th. Two investment analysts have rated the stock with a Strong Buy rating, six have given a Buy rating, seven have given a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and a consensus target price of $71.00.

Key Headlines Impacting Zillow Group

Here are the key news stories impacting Zillow Group this week:

• Positive Sentiment: Zillow exceeded second-quarter expectations, reporting adjusted earnings of $0.52 per share versus the $0.45 consensus estimate and revenue of $772 million versus $758.1 million expected. Revenue increased approximately 18% year over year. Zillow Q2 earnings report
• Positive Sentiment: The company announced leadership promotions, including expanding CFO Jeremy Hofmann’s role to chief operating officer and appointing Cassandra Knight as chief legal and policy officer. Management said the changes are intended to support its integrated housing “super app” strategy. Zillow leadership changes
• Neutral Sentiment: Zillow’s July market report showed home sales up 7% year over year, the strongest annual increase of 2026 so far. However, the gain primarily reflected offers accepted in June, while newly pending sales dropped sharply as mortgage rates reached a one-year high, pointing to a potentially weaker second half. Zillow July market report
• Negative Sentiment: Zillow issued third-quarter revenue guidance of $745 million to $760 million, below the roughly $772.3 million analyst consensus, and full-year revenue guidance of $2.9 billion to $3.0 billion, around or below expectations. The soft forecast is the main reason the earnings beat failed to reassure investors.
• Negative Sentiment: Zillow reported a $4 million net loss because $36 million in restructuring costs outweighed stronger revenue. The company is also eliminating just over 500 positions, or about 7% of its workforce, highlighting cost pressures and a flat housing market. Zillow layoffs report
• Negative Sentiment: Zillow is facing multiple securities-fraud class-action notices related to alleged misrepresentations about an anticompetitive agreement. The August 10 lead-plaintiff deadline adds legal and reputational risk, although the allegations have not been proven. Zillow securities litigation notice

Insiders Place Their Bets

In other Zillow Group news, Director Erik C. Blachford sold 791 shares of the firm's stock in a transaction dated Monday, June 8th. The stock was sold at an average price of $34.80, for a total transaction of $27,526.80. Following the transaction, the director directly owned 34,952 shares in the company, valued at $1,216,329.60. This trade represents a 2.21% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Jeremy Wacksman sold 9,072 shares of the firm's stock in a transaction dated Friday, May 22nd. The shares were sold at an average price of $36.54, for a total value of $331,490.88. Following the transaction, the chief executive officer owned 153,699 shares in the company, valued at approximately $5,616,161.46. This trade represents a 5.57% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 42,910 shares of company stock worth $1,605,732 in the last 90 days. 25.03% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

Institutional investors have recently made changes to their positions in the stock. IFC & Insurance Marketing Inc. bought a new stake in Zillow Group during the fourth quarter worth approximately $68,000. Advisory Services Network LLC bought a new position in shares of Zillow Group in the third quarter valued at approximately $99,000. Northwestern Mutual Wealth Management Co. raised its position in shares of Zillow Group by 186.3% in the second quarter. Northwestern Mutual Wealth Management Co. now owns 1,678 shares of the financial services provider's stock valued at $118,000 after purchasing an additional 1,092 shares during the period. Kestra Advisory Services LLC acquired a new stake in shares of Zillow Group in the fourth quarter worth $153,000. Finally, Lido Advisors LLC acquired a new stake in shares of Zillow Group in the third quarter worth $212,000. 71.01% of the stock is owned by institutional investors.

About Zillow Group

Zillow Group, Inc is an online real estate marketplace company that operates a portfolio of consumer-facing websites and mobile apps designed to connect buyers, sellers, renters, homeowners and real estate professionals. The company's platforms aggregate property listings, rental listings, and related information to help users search for homes, estimate property values and connect with agents and service providers. Zillow generates revenue primarily through advertising and lead-generation services for real estate professionals, property managers and mortgage lenders.

Key products and services include the Zillow and Trulia consumer websites and apps, which provide searchable listings, photos, neighborhood data and the company's automated home valuation tool known as the “Zestimate.” Zillow also offers a rentals marketplace, a mortgage marketplace and tools for home buying and selling such as Zillow Premier Agent for agent advertising and leads, as well as ancillary services designed to support transactions, including closing and title-related offerings.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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