Zillow Group’s 3Q19 financial results

Property Editor

November 10, 2019

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Results reflect expanded margins in Zillow Group's IMT segment and sharp focus on Zillow Offers execution

Zillow Group, Inc., which is transforming the way people buy, sell, rent, and finance homes, today announced its consolidated financial results for the three months ended Sept. 30, 2019. The company's consolidated quarterly revenue more than doubled year over year, driven by strong results in Zillow Group's Homes segment and solid performance in the Premier Agent business.

"Our third quarter results were strong, demonstrating that Zillow Group's business model expansion to mechanize real estate transactions is gaining traction as consumer demand reveals people want a better, simpler way to buy, sell, rent and finance homes. Our core Premier Agent business is strong, with record revenue that exceeded our outlook. The profitability of our Premier Agent business is foundational to Zillow's success and is the reason we are able to expand Zillow Offers with such confidence and speed. This quarter's results illuminate how Zillow Group is in the most favorable position to lead Real Estate 2.0."

— Zillow Co-Founder and CEO Rich Barton

Recent highlights include:

  • Total third quarter consolidated revenue grew 117% year over year to $745.2 million, driven primarily by significant growth in the Homes segment.
  • Our Premier Agent business drove third quarter IMT revenue to $335.3 million, a year-over-year increase of 7%. IMT segment margin improved year over year, reflecting focused cost control and continued operating leverage from our scale and leadership.
  • Consumer awareness and demand for Zillow Offers is growing rapidly. More than 80,000 homeowners requested an offer from Zillow in the third quarter.
  • Zillow Offers opened eight new markets in the third quarter: Portland, Ore.; Nashville, Tenn.; Miami; San Diego; San Antonio; Austin, Texas; and Fort Collins and Colorado Springs, Colo.
  • The company expects to be in 26 markets by mid-2020, including Los Angeles — the second-largest housing market in the country — by the end of 2019.
  • Traffic to Zillow Group's mobile apps and websites reached an all-time high in the third quarter with average monthly unique users up 5% year over year to 195.6 million. Visits exceeded 2.1 billion, up 11% year over year.

Third Quarter 2019 Financial Highlights

The following table sets forth Zillow Group's financial highlights for the periods presented (in thousands, unaudited):

 

Three Months Ended
September 30,

 

2018 to 2019

% Change

 

Nine Months Ended
September 30,

 

2018 to 2019

% Change

 

2019

 

2018

     

2019

 

2018

   

Revenue:

                     

Homes segment

$

384,626

   

$

11,018

   

3,391%

 

$

762,022

   

$

11,018

   

6,816%

IMT segment:

                     

Premier Agent

240,698

   

232,703

   

3%

 

690,394

   

677,320

   

2%

Rentals

44,430

   

37,319

   

19%

 

124,938

   

99,670

   

25%

Other (1)

50,162

   

43,616

   

15%

 

141,899

   

123,445

   

15%

Total IMT segment revenue

335,290

   

313,638

   

7%

 

957,231

   

900,435

   

6%

Mortgages segment

25,292

   

18,438

   

37%

 

79,637

   

56,766

   

40%

Total revenue

$

745,208

   

$

343,094

   

117%

 

$

1,798,890

   

$

968,219

   

86%

Other Financial Data:

                     

Segment income (loss) before income taxes:

                     

Homes segment

$

(87,870)

   

$

(16,428)

       

$

(204,197)

   

$

(30,879)

     

IMT segment

$

42,053

   

$

6,322

       

$

43,839

   

$

(184)

     

Mortgages segment

$

(12,254)

   

$

(623)

       

$

(32,308)

   

$

(625)

     

Net loss

$

(64,649)

   

$

(492)

       

$

(204,151)

   

$

(22,176)

     

Adjusted EBITDA (2):

                     

Homes segment

$

(67,825)

   

$

(13,409)

       

$

(158,801)

   

$

(25,274)

     

IMT segment

91,102

   

75,363

       

216,204

   

181,764

     

Mortgages segment

(7,435)

   

4,211

       

(15,342)

   

11,985

     

Total Adjusted EBITDA

$

15,842

   

$

66,165

       

$

42,061

   

$

168,475

     

Percentage of Revenue:

                     

Segment income (loss) before income taxes:

                     

Homes segment

(23)

%

 

(149)

%

     

(27)%

   

(280)

%

   

IMT segment

13

%

 

2

%

     

5%

   

%

   

Mortgages segment

(48)

%

 

(3)

%

     

(41)%

   

(1)

%

   

Net loss

(9)

%

 

%

     

(11)%

   

(2)

%

   

Adjusted EBITDA:

                     

Homes segment

(18)

%

 

(122)

%

     

(21)%

   

(229)

%

   

IMT segment

27

%

 

24

%

     

23%

   

20

%

   

Mortgages segment

(29)

%

 

23

%

     

(19)%

   

21

%

   

Total Adjusted EBITDA

2

%

 

19

%

     

2%

   

17

%

   
 

(1) Other revenue primarily includes revenue generated by new construction and display, as well as revenue from the sale of various other marketing and business products and services to real estate professionals.

(2) Adjusted EBITDA is a non-GAAP financial measure; it is not calculated or presented in accordance with U.S. generally accepted accounting principles, or GAAP. See below for more information regarding our presentation of Adjusted EBITDA, including a reconciliation of Adjusted EBITDA to the most directly comparable GAAP financial measure, which is net loss on a consolidated basis and income (loss) before income taxes for each segment, for each of the periods presented.

SOURCE Zillow Group, Inc.

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Acerca de Lucas Vargas:

  • Empezó en Grupo ZAP como el VP de Sales y en 2016 cuando la empresa tenía 60 empleados. Fue nombrado COO de VivaReal tomando el mando de Brian Requarth el Co-Fundador. VivaReal lanzó en Colombia y se trasladó a Brasil. En 2017 se hizo CEO del Grupo ZAP.
  • Ha trabajado en Mexico en PWC y en el Banco Santander
  • Tiene un Master de Business Administration de Harvard
  • En noviembre este año después de la fusión de OLX Brasil y Grupo ZAP fue nombrado el CEO del OLX Business Unit. Lidera la empresa junto con Andries Oudshoorn y Marcos Leite
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Simon Baker is the Founder and Executive Chairman of Online Marketplaces and Property Portal Watch. Involved with property portals for 15 years, he’s a well-recognized expert and industry consultant.
As former CEO/MD of the REA Group for 8 years, Simon led the group to its current market-leading position. When he joined REA Group in 2001, it had $4m in revenues, $6m in losses and an $8m market cap.
By 2008, the company presided over $155m in revenues, $35m in EBITDA and enjoyed a peak market cap of $1b. Simon is currently Chairman of the Mitula Group and Real Estate Investar and a serial portal founder and, investor.