CoStar Group 2025-26: 58 Q Double-Digit Growth, Homes.com Surge
FY25 revenue $3.25B (+19%); op income -$72M (reflecting Homes.com investment cycle + Matterport integration); NI $7M; EPS $0.02 (basically zero, GAAP impacted by reinvestment + acquisitions). FCF $41M. Capex $-389M (-39% from $638M FY24). Q3 revenue $834M (+20% YoY); Adj EBITDA $115M (+51% YoY); 58th consecutive quarter of double-digit revenue growth. Q3 segment performance — Commercial Information + Marketplace: 47% profit margin. Residential portals (Apartments.com + Homes.com): Q3 revenue $411M annualizing to $1.644B; +22.7% QoQ / +31.3% YoY. Apartments.com Q3 revenue $303M (+11% YoY) with >$1.2B annual run rate. LoopNet Q3 +10% revenue growth. Matterport Q3 $44M revenue (+12% above expectations). CoStar products Q3 +8% revenue growth. Homes.com fastest-growing revenue product ever launched in CoStar history; 50% of software development costs allocated to AI features. Domain acquisition (Australian residential) contributing. Zillow facing multiple lawsuits — competitive dynamic. Total debt $1.14B (+10%); buyback $575M FY25 (+1,849% from $30M FY24); dividend $0. FY25 raised guide (per Q3): revenue $3.23B-$3.24B (excluding Domain); CoStar product +7% FY; Residential revenue more than double to $210M-$215M; LoopNet +10-11% FY; Q4 CoStar product +8-9%; Q4 Residential $100M-$105M.
Key takeaways
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58 consecutive quarters of double-digit revenue growth — multi-year compounding track record unmatched in real estate data. CoStar Group achieved its 58th consecutive quarter of double-digit revenue growth in Q3 FY25 — over 14 years of unbroken double-digit top-line compounding. This track record is among the longest sustained growth records in any large-cap public company globally. Q3 revenue +20% YoY ($834M) reflects continued multi-segment growth: commercial real estate information + marketplaces + residential portals. Adj EBITDA +51% YoY = even faster operating leverage flow-through. Multi-year compounding thesis fundamentally intact.
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Residential portals (Apartments.com + Homes.com) Q3 revenue $411M annualizing to $1.6B+ — multi-year residential platform inflection. CoStar's residential portals delivered Q3 revenue of $411M (annualizing $1.644B), with +22.7% QoQ and +31.3% YoY growth. Apartments.com Q3 $303M (+11% YoY) crossed $1.2B annual run rate. Homes.com (CoStar's residential search platform competing with Zillow) is "the fastest-growing revenue product ever launched" in CoStar's history. Combined with Domain acquisition (Australian residential), CoStar is building a multi-region residential property platform that materially expands the multi-decade TAM beyond commercial real estate.
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AI investment: 50% of Homes.com software development costs on AI features — multi-year platform moat. CoStar is investing aggressively in AI: 50% of Homes.com software development costs allocated to AI features. The combination of (a) deep proprietary commercial real estate + residential data lake, (b) 30+ years of structured data, (c) AI-native search + recommendations + agent matching, (d) multi-region multi-platform integration creates a structural AI-data moat. Multi-year monetization runway through (i) higher engagement / NPS, (ii) higher conversion, (iii) cross-sell across products, (iv) potential AI agent fees.
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Zillow facing multiple lawsuits — competitive dynamic favorable to Homes.com. Management explicitly highlighted that Zillow (Homes.com's primary competitor) is facing multiple lawsuits affecting its business. Combined with Homes.com's "fastest-growing revenue product ever launched" trajectory + AI investment + sales force expansion, the residential search market dynamics appear increasingly favorable to CoStar's residential platform. Multi-year market share + revenue capture optionality.
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FY25 raised guide: revenue $3.23-$3.24B; residential >2x to $210-$215M — sustained growth setup. FY25 guide raised through the year: total revenue $3.23-$3.24B (excluding Domain). Residential revenue more than doubled to $210-$215M (multi-segment ramp). CoStar product +7% FY; LoopNet +10-11% FY. Q4 CoStar product +8-9%; Q4 Residential $100-$105M. The combination of multi-segment growth + raised guidance + 58 Q double-digit track record positions CoStar for continued multi-year compounding into FY26.
Business
CoStar Group, Inc. is the leading provider of commercial real estate information + marketplaces + residential portals globally, with multi-segment platform:
- Commercial Information + Marketplaces (~50% of revenue, highest margin):
- CoStar Suite + LoopNet (~30% of revenue): Subscription-based commercial real estate research + analytics. CoStar Lender, CoStar product +7% FY guide, LoopNet +10-11% FY.
- Marketplaces (Apartments.com + LoopNet listings + others): Apartments.com $1.2B+ run-rate; LoopNet listings.
- 47% profit margin per Q3.
- Residential Portals (~30% of revenue, fastest growing): Homes.com (US residential search) + Domain (Australian residential, acquired 2025). Q3 revenue $411M annualizing $1.6B+. +31% YoY.
- Matterport (~10%): 3D virtual tour platform. Q3 $44M (+12% above expectations). Multi-year integration with CoStar.
- Other / Information Services (~10%): STR + News + Land + others.
Strategic moves FY25:
- 58th consecutive Q double-digit revenue growth
- Q3 revenue $834M (+20%); adj EBITDA $115M (+51%)
- Homes.com fastest-growing revenue product ever launched
- 50% of Homes.com software dev costs on AI features
- Apartments.com >$1.2B annual run rate
- Domain (Australia) acquisition contributing
- Matterport integration ongoing (12% above expectations)
- $40M Europe cost savings via streamlining (Q2)
- 2025 raised guidance through year
- $575M FY25 buyback (+1,849% YoY)
- Multi-year sales force expansion + Homes.com NPS
FY25 financial performance
| Metric (FY) | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue ($B) | 2.18 | 2.46 | 2.74 | 3.25 |
| Revenue YoY | n/a | +12% | +11% | +19% |
| Op income ($M) | 451 | 282 | 5 | -72 |
| Op margin | 20.7% | 11.5% | 0.2% | -2.2% |
| Net income ($M) | 370 | 375 | 139 | 7 |
| Diluted EPS ($) | 0.93 | 0.92 | 0.34 | 0.02 |
| FCF ($M) | 420 | 464 | -245 | 41 |
| Capex ($M) | -59 | -25 | -638 | -389 |
| Total debt ($B) | 1.11 | 1.11 | 1.04 | 1.14 |
| Buyback ($M) | -23 | -26 | -30 | -575 |
| Dividends | 0 | 0 | 0 | 0 |
The earnings progression: revenue grew steadily $2.18B → $3.25B (FY22-25, +49% over 3 years). Op income materially compressed: 20.7% (FY22) → -2.2% (FY25) reflecting (a) Homes.com investment cycle, (b) Matterport acquisition + integration costs, (c) Visual Lease + Domain integration, (d) AI software development investment, (e) sales force expansion.
EPS GAAP $0.02 reflects deep reinvestment cycle. Multi-year operating leverage thesis — once Homes.com matures + Matterport / Domain integrate, margin recovery setup multi-year. FCF $41M FY25 (vs -$245M FY24, capex peak rolling off).
Buyback dramatic step-up to $575M FY25 (vs $30M FY24) signals management confidence in undervaluation.
Capital allocation
- Capex: $-389M FY25 (-39% YoY) — Homes.com + Matterport + AI investment cycle moderating.
- Dividends: $0 (no dividend; growth + investment phase).
- Buybacks: $-575M FY25 (+1,849% YoY) — major acceleration.
- Total debt: $1.14B (+10% YoY).
- FCF: $41M FY25 (vs -$245M FY24).
FY26 outlook (per FY25 raised guide; Q4 specific guide pending)
| FY25/FY26 framework | Detail |
|---|---|
| FY25 revenue (raised) | $3.23B to $3.24B (excluding Domain) |
| FY25 CoStar product | +7% growth |
| FY25 Residential revenue | $210M to $215M (more than doubled) |
| FY25 LoopNet | +10% to +11% growth |
| Q4 CoStar product | +8% to +9% |
| Q4 Residential | $100M to $105M |
| Q3 adj EBITDA | $115M (above guide) |
| Multi-year focus | 58 Q double-digit revenue growth; AI investment; multi-region |
Note: FY26 specific guide pending Q4 call. Multi-year framework: continued multi-segment double-digit growth + Homes.com inflection + multi-year capital return.
Key risks
Residential search competitive landscape. Zillow, Redfin, Realtor.com (News Corp), Trulia, Compass, and others compete in residential search.
Commercial real estate cycle dependency. CoStar Suite + LoopNet sales correlate with commercial real estate transaction activity + capex cycle.
Homes.com investment cycle duration. Multi-year Homes.com investment (50% of software dev costs on AI) requires multi-year payback period.
Matterport integration execution. Multi-year Matterport (acquired 2024) integration + sales force expansion + cross-sell.
Domain integration (Australia). Multi-year Australian residential market dynamics + integration.
AI competitive landscape. Zillow + Redfin + emerging AI startups all investing in AI for residential search.
FX (Australian, European operations). Multi-region operations create translation impact.
Multi-product cross-sell complexity. Multi-product portfolio creates sales execution complexity.
Zillow lawsuit dynamics. While currently favorable to CSGP, lawsuit outcomes uncertain and timing unclear.
Capital allocation discipline. $575M buyback at multi-year accelerated pace requires multi-year discipline.
Talent retention. Engineering + sales talent multi-year competitive market.
Cybersecurity + customer data. Multi-region customer data + transaction processing.
Matterport revenue trajectory. Multi-year integration + revenue ramp.
Pricing sustainability. Multi-year pricing actions face customer pushback at some point.
Multi-region regulatory. Multi-region real estate + privacy regulations.
Bottom line
CoStar Group FY25 is the multi-segment investment cycle + Homes.com inflection + capital return acceleration year: revenue $3.25B (+19%); op income -$72M (reinvestment cycle); NI $7M; EPS $0.02 GAAP; FCF $41M (vs -$245M FY24, capex peak rolling off). Q3 revenue $834M (+20%); adj EBITDA $115M (+51%). 58 consecutive Q double-digit revenue growth. Residential portals Q3 $411M (annualizing $1.6B+; +31% YoY). Apartments.com $1.2B+ run rate. Homes.com fastest-growing revenue product ever; 50% software dev on AI. LoopNet +10% Q3. Matterport $44M Q3 (+12% above guide). Domain (Australia) acquired. Zillow facing lawsuits — competitive dynamic favorable. $575M FY25 buyback (+1,849% YoY). Total debt $1.14B (+10%).
FY25 raised guide: revenue $3.23-$3.24B; CoStar product +7%; Residential >2x to $210-$215M; LoopNet +10-11%; Q4 CoStar product +8-9%; Q4 Residential $100-$105M. FY26 specific guide pending Q4 call.
The risks are real — residential search competitive landscape (Zillow, Redfin, Realtor.com, Trulia, Compass), commercial real estate cycle dependency, Homes.com investment cycle duration, Matterport integration execution, Domain integration (Australia), AI competitive landscape, FX (Australian + European), multi-product cross-sell complexity, Zillow lawsuit dynamics uncertainty, capital allocation discipline, talent retention, cybersecurity + customer data, Matterport revenue trajectory, pricing sustainability, multi-region regulatory.
But the structural thesis (leading provider of commercial real estate information + marketplaces + residential portals globally + 58 consecutive Q double-digit revenue growth + Q3 +20% revenue / +51% adj EBITDA + Apartments.com $1.2B+ run rate + Homes.com fastest-growing revenue product ever + 50% Homes.com software dev on AI features + LoopNet +10% Q3 + Matterport $44M Q3 + Domain Australia acquired + Zillow lawsuit competitive dynamic + 47% Commercial Info + Marketplace profit margin + buyback $575M (+1,849%) + multi-year capital return + multi-year operating leverage thesis post-investment cycle) is intact and FY25 confirms.
Quality global commercial real estate data + residential portal compounder mid-investment-cycle, with 58 Q double-digit track record + Homes.com inflection + multi-year AI investment + capital return acceleration + multi-segment platform + multi-region expansion + multi-year operating leverage runway. The FY25 +19% revenue + Q3 +20% / +51% adj EBITDA + Homes.com record growth + Apartments $1.2B+ + LoopNet +10% + Matterport integration + Domain + AI investment + buyback +1,849% creates one of the cleaner real estate data + portals compounding setups for investors seeking exposure to commercial real estate + residential search + AI-data moat + multi-region expansion + capital return acceleration. The conservative FY25 raised framework + multi-year track record + Homes.com momentum + Matterport / Domain integration + AI investment + post-investment-cycle margin recovery setup + buyback acceleration provides multiple paths to outperformance over a multi-year horizon. Residential competition + commercial cycle + investment cycle duration + integration execution + AI competition remain ongoing risks, but the multi-segment diversification + 58 Q track record + Homes.com momentum + AI moat + capital return support continued compounding through cycles.
Citations
- CoStar Group, Inc. FY25 Form 10-K (filed February 2026, SEC EDGAR).
- CSGP Q3 2025 earnings call, 2025-10-28 — Q3 revenue $834M (+20% YoY); adj EBITDA $115M (+51% YoY); 58th consecutive Q double-digit revenue growth. Commercial Information + Marketplace 47% profit margin. Residential portals: Q3 revenue $411M annualizing $1.644B; +22.7% QoQ / +31.3% YoY. Apartments.com Q3 revenue $303M (+11% YoY); >$1.2B annual run rate. LoopNet Q3 +10% revenue growth. Matterport Q3 $44M revenue (+12% above expectations). CoStar products Q3 +8% revenue growth. Homes.com fastest-growing revenue product ever launched; 50% of software development costs allocated to AI features. Zillow facing multiple lawsuits; Domain acquisition (Australia) contributing strong audience growth. FY25 raised guide: revenue $3.23-$3.24B (excluding Domain); CoStar product +7% FY; Residential revenue more than doubled to $210-$215M; LoopNet +10-11% FY; Q4 CoStar product +8-9%; Q4 Residential $100-$105M.
- CSGP Q2 2025 earnings call, 2025-07-23 — Q2 revenue $781M (+15%); adj EBITDA $85M (+108% YoY); Q2 net new bookings record $93M. Apartments.com $292M Q2 (+11%); Homes.com residential annualized net new bookings $12M; CoStar product $271M (+7%); LoopNet +8% revenue / +345% net new bookings H1. Matterport $44M Q2. $40M Europe cost savings via streamlining.
- CSGP Q1 2025 earnings call — supporting double-digit growth + multi-segment trajectory.
- Internal financial_statements view (consolidated annual + cash flow + capital structure).