Zillow Stock Slides After Q4 Earnings Miss Estimates

Zillow Group, Inc. has reported its financial results for the fourth quarter, revealing key insights into the company's performance. Following the announcement, the company's stock experienced a decline in after-hours trading.

Financial Highlights

For the fourth quarter, Zillow reported earnings of 27 cents per share. This figure fell short of the analyst consensus estimate of 29 cents. However, the company achieved quarterly revenue of $554 million, surpassing the expected $544.96 million and reflecting an increase from $474 million in the same quarter of the previous year.

• For Sale Revenue: Increased by 15% year-over-year, reaching $428 million.
• Residential Revenue: Rose by 11% year-over-year to $387 million, primarily due to improvements in conversion rates and the expansion of Zillow Showcase.
• Mortgages Revenue: Jumped by 86% year-over-year, totaling $41 million, mainly due to a significant increase in purchase loan origination volume, which rose by 90% to $923 million.
• Rentals Revenue: Grew by 25% year-over-year to $116 million, aided by a 41% increase in multifamily revenue.

CEO's Remarks

CEO Jeremy Wacksman commented on the company’s performance, stating, "2024 was a remarkable year for Zillow: We achieved our stated goals for the year — including double-digit revenue growth — and we expect to keep up our momentum in 2025." This optimism reflects the company's strategies aimed at sustaining growth.

Looking Ahead

Looking to the future, Zillow anticipates first-quarter revenue to fall between $575 million and $590 million, which is below the analyst estimate of $600.84 million. This outlook suggests that the company is bracing for a potentially challenging quarter.

Market Reaction

In response to these earnings results and guidance, Zillow Group's shares fell by 6.09% in after-hours trading, settling at $81.06. This indicates that investor sentiment may be cautious following the earnings miss and lower revenue projections for the upcoming quarter.

Zillow, Earnings, Revenue