Zillow Group (Z) Q2 2026 earnings summary

Executive summary

• Q2 revenue rose 18% YoY to $772M, above guidance; adjusted EBITDA was $176M, a 23% margin, and adjusted net income was $118M.

• Mortgages and Rentals led growth, with revenue up 75% and 31%, respectively; total industry transaction value grew 6%.

• Net loss was $4M, versus net income of $2M in Q2 2025; $36M of restructuring costs were recorded outside EBITDA expenses.

• Preferred transition is advancing; management expects higher revenue per connection but cited near-term revenue mix, timing and seasonal headwinds.

• Zillow AI mode was live to ~20% of signed-in users; users spent over 3x longer and contacted an agent at nearly 3x the rate of non-users.

Financial highlights

• Q2 revenue was $772M, up 18% YoY; adjusted EBITDA was $176M, up 14%, and adjusted diluted EPS was $0.52 versus $0.40 a year earlier.

• Net loss was $4M; gross profit was $562M, with gross margin of 73% versus 75% in Q2 2025.

• Operating expenses rose 14% to $572M, including $36M in restructuring costs; Q2 EBITDA expenses were $596M, excluding $10M of FTC matter litigation expenses.

• YTD adjusted free cash flow was $223M, up 19% YoY; Q2 adjusted free cash flow was $96M versus $100M in Q2 2025.

• Cash and investments were $682M at quarter-end; cash, investments and restricted cash totaled $688M.

Outlook and guidance

• Q3 revenue guidance is $745M–$760M, implying ~11% YoY growth at midpoint; EBITDA guidance is $180M–$200M, with a 25% margin at midpoint.

• Q3 For Sale revenue growth is expected at 5%–7%; Residential revenue is expected flat YoY as 600–700 bps shift to Mortgages, which is expected to grow over 50%.

• Q3 Rentals revenue growth is expected in the high 20% range YoY; EBITDA expenses are forecast at $560M–$565M, with headcount-related expenses expected to decrease after restructuring.

• FY26 revenue guidance remains $2.92B–$2.96B, with mid-teens growth; Rentals revenue is expected to grow ~30%. FY EBITDA guidance is $730M–$760M, with continued margin expansion.

• FY26 For Sale growth faces a 400–600 bps headwind from seasonality and mortgage revenue timing; purchase mortgage originations are assumed down low-to-mid single digits.