Zillow Group (Z) Status update summary

Strategic vision, AI acceleration, and platform innovation

• AI is positioned as a transformative force, accelerating the shift from a search-focused platform to an end-to-end real estate transaction ecosystem, integrating rentals, buying, selling, financing, and agent workflows for a seamless experience.

• Proprietary content, deep user context, and industry integration enable unique AI-powered experiences and defensible data moats, with features like AI Mode, BuyAbility, smart messaging, and instant tour booking enhancing consumer and agent efficiency.

• Over 80% of U.S. residential transactions involve agents using at least one product, and more than 60% of vacant units are listed through the platform, supporting a deeply engaged audience of 235 million monthly unique users, with 80% direct traffic.

• New product launches and integrations, such as rental management, credit-building rent payments, digital lease signing, and rich media like 3D tours, drive engagement, recurring revenue, and feed proprietary AI models.

• Continuous product launches and rapid innovation cycles are enabled by AI, with 40% more code shipped per engineer and faster feature deployment.

Financial performance and guidance

• Revenue has grown 43% since 2023, consistently outperforming the housing market, with rentals revenue up 130% since 2022 and rentals now comprising 24% of 2025 revenue.

• EBITDA and free cash flow are growing faster than revenue, with adjusted EBITDA up 59% and adjusted free cash flow up 71% from 2023 to 2025, driven by disciplined cost management and reinvestment in AI and product development.

• Fixed costs have grown below inflation, resulting in net income margin expansion of 590 basis points year-over-year in 2025, with savings redeployed into strategic initiatives.

• Reaffirmed Q1 2026 guidance: total revenue of $700–$710 million and adjusted EBITDA of $160–$175 million; full-year 2026 outlook includes mid-teens revenue growth, ~30% rentals revenue growth, continued adjusted EBITDA margin expansion, and >10% decrease in share-based compensation.

• Set new mid-cycle targets: $5 billion total revenue, 45% adjusted EBITDA margin, and 25% net income margin, assuming a normalized housing market.

Capital management

• Share buybacks remain a key capital management strategy, with over $625 million repurchased in Q1 2026 and an additional $1.25 billion authorized.