Zillow Group (Z) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue grew 17% year-over-year to $581 million, surpassing guidance and driven by strong growth in Residential, Rentals, and Mortgages segments.

• Net loss narrowed to $20 million (3% of revenue), improving from $28 million in Q3 2023.

• Adjusted EBITDA was $127 million (22% margin), up 19% year-over-year and $24 million above guidance midpoint.

• Enhanced markets expanded to 43, driving higher connection and conversion rates, with Showcase reaching nearly 1.5% of new for-sale listings.

• Continued investment in technology, product innovation, and integrated solutions for agents, buyers, and sellers.

Financial highlights

• Q3 2024 revenue: $581 million (+17% year-over-year); gross profit: $441 million (76% margin); net loss: $20 million.

• Adjusted EBITDA: $127 million (22% margin); nine months ended: $386 million (23% margin).

• Cash and investments at quarter-end: $2.2 billion, down from $2.6 billion in Q2 due to convertible debt settlement.

• $301 million in share repurchases during 2024 at an average price of $42; $2 billion repurchased since 2021.

• Operating cash flow for nine months ended: $306 million.

Outlook and guidance

• Q4 2024 revenue expected between $525 million and $540 million, up 12% year-over-year at midpoint.

• Residential revenue guidance: $364–$374 million; rentals revenue to grow mid-20% year-over-year; multifamily rentals to outpace overall rentals.

• Mortgages revenue projected to grow mid-60% year-over-year in Q4.

• Q4 EBITDA expected between $90 million and $105 million (18% margin at midpoint), with full-year 2024 revenue up 14% and EBITDA margin at 22%.

• Management expects sales and marketing expenses to decrease in Q4 2024 in line with typical seasonal media spend.