tapebrief
CSGP · Q3 2025
Preliminary brief— based on press release only. Full analysis including management tone and Q&A will be added when the transcript is available.

CSGP · Q2 2025 Earnings

CoStar Group

Reported July 22, 2025

30-second summary

Revenue grew 15.3% YoY to $781M with adjusted EBITDA of $85M beating the high end of the prior guide. Net new bookings of $93M jumped 65% QoQ — the standout number on the print — and management raised full-year revenue guidance to $3.135-3.155B (≈15% YoY at midpoint) and adjusted EBITDA to $370-390M. Homes.com NPS moved from 3 in Q4 2024 to 38 this quarter with cancellation under 1%, finally validating the unit economics after years of investment burn.

Headline numbers

EPS

Q2 FY2025

$0.17

Revenue

Q2 FY2025

$0.78B

+15.3% YoY

Gross margin

Q2 FY2025

78.5%

Operating margin

Q2 FY2025

-3.5%

Key financials

Q2 FY2025
MetricQ2 FY2025YoY
Revenue$0.78B+15.3%
EPS$0.17—
Gross margin78.5%—
Operating margin-3.5%—

Guidance

Prior quarter data unavailable — comparison not possible.

Segment KPIs

Q2 FY2025
SegmentQ2 FY2025YoY
CoStar$0.271B+7.1%
Information Services$0.039B+17.7%
Multifamily$0.292B+10.7%
LoopNet$0.076B+8.4%
Residential$0.028B+8.4%
Other Revenues$0.075B+139.4%

Other KPIs

Q2 FY2025
SegmentQ2 FY2025YoY
North America$0.744B+15.6%
International$0.037B+9.7%
Net New Bookings$93 million—
Homes.com Members Added6,300—
Homes.com Member Growth Q1 to Q256%—
Member Agent Listing Win Rate vs Non-Members62% more—
Demo-to-Close Rate>50%—
Homes.com Network Average Monthly Unique Visitors111 million—
Commercial Information and Marketplace Brands Profit Margin43%—
Adjusted EBITDA$85 million—

Management tone

Homes.com flipped from experimental to proven this quarter. NPS moved from 3 in Q4 2024 to 38 in Q2 2025, 6,300 net new members joined (56% QoQ member growth), and early cancellation is under 1%. Andy's framing — "we believe that the majority of home buyers, once they try homes.com, prefer homes.com" — drops the hedging that defined prior calls. The shift signals that the cash-burning experiment is now a defensible asset with measurable retention and ROI.

Matterport is being repositioned from a standalone acquisition to platform infrastructure. Management laid out a concrete B2B pivot, Pro 4 camera roadmap, CoStar-branded rebrand, and integration of 3D tours across every portal (23x more leads with tours attached). The "agentic AI-first operating model" phrasing telegraphs an automation push that wasn't articulated in earlier quarters. The signal: Matterport is no longer an integration story, it's a moat across the entire portfolio.

The Zillow narrative shifted from defensive to opportunistic. Andy spent significant air time on Zillow's 24-hour listing mandate, flagged "serious antitrust concerns," cited the Compass lawsuit, and offered free Homes.com boosts to banned listings. Prior calls treated Zillow as a contained threat; this quarter treats Zillow as policy-vulnerable and Homes.com as the agent-aligned alternative. The "we sell leases. we don't sell leads" tagline — repeated by multiple speakers — encapsulates the rebranded value proposition.

International went from secondary to structural. UK net new bookings are up 257% YTD, LoopNet launches Spain and France in Q4, Domain closes Q3 with an incremental A$2.3B investment, and Andy framed the ACCC investigation into REA Group as "an excellent opportunity" for Domain. The line "over 50% of CRE transactions are cross-border, yet there are no comprehensive pan-European solutions" reframes international from emerging-markets opportunism to a white-space land grab.

LoopNet's guide moved from gradual recovery to a confident double-digit call: Chris stated revenue growth will exceed 10% in H2 2025, with asset-based pricing and portfolio packaging cited as the durability mechanism, not cyclical CRE rebound. Monetization per listing is up YoY despite a CRE market Andy still characterizes as facing "difficulties." This is a structural-tailwind narrative replacing a wait-for-the-cycle narrative.

Recurring themes management leaned on this quarter:

Sales force expansion as primary growth lever (1,800 reps as of Q2, +43% YoY; 750 planned for Homes.com by YE; 500 for Apartments.com)Monetization-per-unit optimization (ASP growth, asset-based pricing, tiered advertising) replacing volume-dependent modelsInternational/cross-border arbitrage (Domain, LoopNet Spain/France, UK +257% YTD bookings; 50%+ CRE transactions are cross-border)Matterport as platform differentiator (integrated across all portals; 67M views in Q2 +193% YoY; 23x more leads with 3D tours)Agent-centric positioning vs. lead-diversion models (Homes.com and Apartments.com frame as pro-agent; anti-Zillow messaging)Profitability as near-term imperative for growth businesses (Matterport losses, VHT windown; focus on margin-accretive sales; Homes.com unit economics scrutinized)

Risks management surfaced:

CRE market challenges, particularly office segment with high vacancy and negative net absorption (Andy: 'CRE market continues to face difficulties')Homes.com penetration still 'very low' vs. established competitors; lengthy path to high NPS/renewal rate parity with Apartments.com (94 NPS)Matterport profitability not yet achieved; requires sales force discipline and capital investment before margin accretionDomain acquisition closing contingent on Q3 close; forward currency swap indicates FX risk mitigation ongoingCompetitive escalation risk from Zillow and REA Group; antitrust investigations could shift competitive dynamics unpredictably

What to watch into next quarter

Whether Homes.com NPS holds above 38 and member growth sustains a double-digit sequential pace — single quarter of inflection is not a trend

Q3 net new bookings: $93M in Q2 was up 65% QoQ; watch whether bookings hold above $80M or if Q2 pulled forward demand

Domain closing mechanics and any guidance reset incorporating ~A$2.3B incremental investment and the acquired revenue stream

LoopNet H2 growth tracking above the 10% commitment — Q3 LoopNet revenue should accelerate from Q2's 8.4% if Chris's call holds

Matterport profitability trajectory and whether the agentic AI / B2B pivot translates to measurable sales productivity by Q4

Operating margin progression: -3.5% in Q2 is a notable gap to the 43% Commercial brands margin, indicating heavy growth-segment burn that should narrow as Homes.com matures

Sources

  1. CoStar Group Q2 2025 Earnings Press Release — https://www.sec.gov/Archives/edgar/data/1057352/000105735225000095/q22025earningspressrelease.htm

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