In This Article:
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Total Revenue: $598 million, up 13% year-over-year.
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For-Sale Revenue: $458 million, up 8% year-over-year.
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Residential Revenue: $417 million, up 6% year-over-year.
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Mortgages Revenue: $41 million, up 32% year-over-year.
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Rentals Revenue: $129 million, up 33% year-over-year.
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Adjusted EBITDA: $153 million, with a margin of 26%, up 200 basis points year-over-year.
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GAAP Net Income: $8 million, representing 1% of revenue.
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Cash and Investments: $1.6 billion at the end of Q1.
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Convertible Debt: $419 million outstanding, expected to settle before the end of Q2.
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Multifamily Properties: 55,000 at the end of Q1, up 38% year-over-year.
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Share Repurchases: $250 million in Q1, with an additional $1 billion authorization approved.
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Zillow Group Inc (NASDAQ:Z) exceeded its Q1 2025 outlook, achieving strong top-line growth and GAAP profitability.
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The company reported a 13% year-over-year increase in total revenue, reaching $598 million, with significant growth in rentals and mortgages revenue.
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Zillow Group Inc (NASDAQ:Z) expanded its EBITDA margin by 200 basis points year-over-year to 26%, demonstrating effective cost management.
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The company continues to lead in the residential real estate market with 227 million average monthly unique users and 4x the app engagement of the next competitor.
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Zillow Group Inc (NASDAQ:Z) is successfully executing its housing super app strategy, integrating services like Premier Agent and Zillow Home Loans to enhance customer experience and drive growth.
Negative Points
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The high-end housing market outperformed, contributing to growth, while the middle and lower end remained flat, posing challenges for broader market performance.
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The macroeconomic environment remains uncertain, with the housing market expected to continue bouncing along the bottom.
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Zillow Group Inc (NASDAQ:Z) faces challenges in expanding its Enhanced Markets, requiring methodical rollout and integration with Zillow Home Loans and Premier Agent partners.
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The company anticipates increased expenses in Q2 2025, driven by seasonal marketing and costs associated with the Redfin rentals partnership.
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Despite strong growth in rentals, the overall housing market remains constrained by affordability challenges and limited inventory, impacting transaction volumes.
Q & A Highlights
Q: Can you elaborate on the factors driving the acceleration in the rentals business, particularly with multifamily units? A: Jeremy Wacksman, COO, explained that the strategy of building a comprehensive marketplace with a national database of rental listings is driving growth. With over 2 million listings, Zillow is becoming the preferred choice for renters. The increase in multifamily properties and the quality of leads provided to advertisers are key growth drivers. CFO Jeremy Hofmann added that rentals revenue grew 33% in Q1, with expectations of 40% growth for the full year.