Zillow Group has announced a first quarter total revenue of $186 million, an increase of 25 per cent year on year (YOY), while EBITA dropped in part due to legal costs.
Real Estate revenue reached $152.5 million an increase of 34 per cent YOY with the results prompting a raise to full-year revenue outlook to a range of $825 million to $835 million.
Mortgages Revenue, which increased 65 per cent to $16.5 million from pro forma revenue of $10 million in the first quarter of 2016
The property portal giant also recorded an all-time high of more than 166 million unique users in March for all its brands including Zillow, Trulia, StreetEasy and HotPads which represents an increase of 22 per cent YOY.
Average monthly unique users during the first quarter reached more than 156 million.
However, Display Revenue decreased 34 per cent to $17 million from $25.6 million in the first quarter of 2015,primarily a result of the company’s strategy to deemphasize display advertising and improve the user experience.
First quarter net loss was reduced to $47.6 million from $58.4 million in the same period last year. The loss includes the impact of $15.7 million in legal costs related to the litigation with News Corp. and the National Association of Realtors.
Adjusted EBITDA was $1.9 million in the first quarter of 2016, or 1 per cent of Revenue, which was a decrease from an EBITDA of $24.5 million (15% of revenue) in the first quarter of 2015.
Adjusted EBITDA in the first quarter of 2016 includes $15.7 million in legal costs related to the litigation with News Corp. and the National Association of Realtors.
- Basic and diluted GAAP net loss per share was $0.27 in the first quarter of 2016, compared to basic and diluted GAAP net loss per share of $0.40 in the same period last year.
- Basic and diluted non-GAAP net loss per share was $0.13 in the first quarter of 2016, compared to basic and diluted non-GAAP net income per share of $0.02 in the same period last year. Non-GAAP net income (loss) per share excludes share-based compensation expense, acquisition-related costs, restructuring costs and income taxes.
Financial highlights for the three months ended March 31, 2016 also include:
Average monthly unique users for the first quarter of 2016 exceeded 156 million.
- All-time high of more than 166 million unique users in March to Zillow Group consumer brands Zillow, Trulia, StreetEasy and HotPads, an increase of 22% year-over-year.
- In March, Zillow Group achieved its highest market share, capturing 63% of the mobile and Web real estate audience.
- When looking at mobile-only, Zillow Group’s market share is even larger, capturing 72% of the category.1
Zillow Group’s Premier Agent business achieved record revenue of $134.5 million in the first quarter of 2016, up 25% year-over-year on a pro-forma basis, and exceeded the high end of guidance.
- Average Revenue Per Advertiser (ARPA) was $487, up 40% year-over-year on a pro-forma basis.
- Total sales to Premier Agent Advertisers who have been customers for more than one year increased 56% year-over-year.
- Sales to existing Premier Agent Advertisers accounted for 71% of total bookings.
- Premier Agent Advertisers who spend more than $5,000 per month:
- Increased 83% year-over-year on a total dollar basis.
- Increased 74% year-over-year in the number of agent advertisers.
Zillow Group says it is continuing to innovate by launching new products and features that enhance consumers’ and agents’ experiences across all mobile and Web platforms.
- Team profiles on Premier Agent platform allow agents on teams to associate themselves with that team, and help them more effectively manage and convert their flow of online leads to commissions.
- New suite of lead management tools enables team leaders to route online leads automatically to their team and track results.
- New self-serve shopping cart for Premier Agents allows for more flexibility in purchasing advertising.
Business Outlook – Second Quarter and Full Year 2016
For the second quarter of 2016, Zillow Group’s Revenue is expected to be in the range of $203 million to $208 million. Adjusted EBITDA for the second quarter is expected to be $15 million to $20 million, and is affected by legal costs associated with the News Corp. and National Association of Realtors litigation, which are anticipated to be between $18 million and $20 million in the second quarter.
For full year 2016, Zillow Group is increasing its outlook for Revenue to a range of $825 million to $835 million, up from a range of $805 million to$815 million.
The 2016 revenue outlook represents a 29 per cent year-over-year increase at the midpoint of the range, compared to a 24 per cent increase from 2014 to 2015,
Adjusted EBITDA outlook remains in the range of $115 million to $125 million, and is affected by legal costs associated with the News Corp. and National Association of Realtors, litigation, which are anticipated to be between $50 million and $55 million in 2016.
|Three Months Ending||Year Ending|
|Zillow Group Outlook as of May 3, 2016||June 30, 2016||December 31, 2016|
|Revenue||$203 to $208||$825 to $835|
|Premier Agent revenue||$146 to $148||$595 to $600|
|Display revenue||$16 to $17||$58 to $60|
|Operating expenses||$237 to $242||***|
|Adjusted EBITDA||$15 to $20||$115 to $125|
|Depreciation and amortization||$24 to $26||$95 to $100|
|Share-based compensation expense||$26 to $28||$105 to $110|
|Capital expenditures||***||$41 to $43|
|Weighted average shares outstanding — basic||178.5 to 180.5||180.0 to 182.0|
|Weighted average shares outstanding — diluted||193.5 to 195.5||194.5 to 196.5|