Zillow Group (NASDAQ:Z) Posts Earnings Results, Misses Estimates By $0.03 EPS

Zillow Group (NASDAQ:Z) announced its quarterly earnings data on Wednesday. The financial services provider reported $0.55 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.58 by ($0.03), FiscalAI reports. The company had revenue of $724.00 million for the quarter, compared to the consensus estimate of $753.54 million. Zillow Group had a negative net margin of 3.95% and a positive return on equity of 3.18%.

Here are the key takeaways from Zillow Group’s conference call:

• Zillow’s Q3 revenue rose 7% year over year to $724 million, while EBITDA reached $182 million and margin expanded 70 basis points to 25%, despite a difficult housing market. Adjusted diluted EPS was $0.55, compared with $0.44 a year earlier.
• Rentals revenue grew 26% to $220 million, led by 35% growth in multifamily; advertised multifamily properties reached a record 81,000, up 17%. Management sees a path for Rentals to exceed $1 billion in annual revenue.
• Zillow said its Preferred transition is on track to cover more than 75% of connections by year-end and all connections in the first half of 2027; Preferred connections generate 35% more revenue per connection than the legacy model. Zillow Home Loans originations grew 55% in Q3, though executives said higher rates weakened the pipeline and expect the mortgage market to remain pressured.
• AI Mode is now available to all signed-in users; more than 2.5 million people used it from March through September, and users showed deeper engagement, including more home views and tour requests. Management framed AI as a way to strengthen Zillow’s consumer experience and help agents work more efficiently.
• Q4 guidance reflects a tougher outlook: total revenue is expected to be roughly flat year over year, with for-sale and residential revenue down about 9%–15% and EBITDA of $100 million–$135 million. Zillow expects purchase mortgage originations for the industry to decline 10%–15%, citing the sharp rise in mortgage rates and continued affordability pressure.

Zillow Group Price Performance

Shares of Z opened at $30.29 on Friday. Zillow Group has a 1 year low of $26.67 and a 1 year high of $77.07. The company has a 50 day simple moving average of $30.92 and a two-hundred day simple moving average of $38.44. The firm has a market cap of $6.81 billion, a P/E ratio of -58.25, a price-to-earnings-growth ratio of 1.45 and a beta of 1.98.

Zillow Group News Summary

Here are the key news stories impacting Zillow Group this week:

• Positive Sentiment: Third-quarter revenue increased 7% year over year, with the rentals business helping cushion weakness in home sales. Zillow also said its “Zillow Preferred” model can generate more revenue per buyer connection than its prior model. Zillow Revenue Rises as Rentals Help Offset Weak Market for Home Sales How Zillow Is Staying Flexible in a Brittle Housing Market
• Neutral Sentiment: Needham reaffirmed its “hold” rating, signaling no change in its view of the shares. Needham rating information
• Negative Sentiment: Zillow reported third-quarter EPS of $0.55, below the roughly $0.58 consensus, while revenue of $724 million also missed expectations of about $754 million. Zillow misses Q3 earnings and revenue estimates
• Negative Sentiment: The company expects fourth-quarter revenue of $635 million to $665 million and forecasts purchase mortgage originations to decline 10%–15%, indicating continued pressure on its home-financing business. Zillow Q4 outlook
• Negative Sentiment: Housing-market indicators were weak in October: newly pending listings fell 16.8% year over year, while Zillow’s preliminary measure of existing-home sales declined 8.7%. Fewer transactions could weigh on sales-related revenue. October housing market report

Insider Activity

In other news, CEO Jeremy Wacksman sold 9,339 shares of the business’s stock in a transaction on Monday, August 17th. The shares were sold at an average price of $34.18, for a total value of $319,207.02. Following the transaction, the chief executive officer owned 138,574 shares of the company’s stock, valued at approximately $4,736,459.32. The trade was a 6.31% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, Director Claire Cormier Thielke sold 1,187 shares of the company’s stock in a transaction on Thursday, September 3rd. The stock was sold at an average price of $35.71, for a total transaction of $42,387.77. Following the transaction, the director owned 2,375 shares of the company’s stock, valued at approximately $84,811.25. This represents a 33.32% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last 90 days, insiders have sold 38,539 shares of company stock valued at $1,323,800. Company insiders own 25.03% of the company’s stock.

Analysts Set New Price Targets

Z has been the subject of a number of recent analyst reports. Evercore lowered shares of Zillow Group from a “strong-buy” rating to a “hold” rating in a research report on Thursday, August 6th. Weiss Ratings restated a “sell (d)” rating on shares of Zillow Group in a research report on Wednesday, August 19th. Morgan Stanley decreased their price objective on shares of Zillow Group from $60.00 to $35.00 and set an “equal weight” rating on the stock in a research report on Tuesday, October 13th. Jefferies Financial Group lowered their target price on shares of Zillow Group from $75.00 to $60.00 and set a “buy” rating on the stock in a research note on Tuesday, July 14th. Finally, JPMorgan Chase & Co. dropped their target price on shares of Zillow Group from $76.00 to $62.00 and set an “overweight” rating for the company in a report on Tuesday, August 11th. One analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating, eight have issued a Hold rating and one has issued a Sell rating to the company. According to data from MarketBeat, the stock currently has an average rating of “Hold” and a consensus price target of $57.71.

Zillow Group Company Profile

Zillow Group, Inc (NASDAQ: Z) operates a digital real estate marketplace in the United States. Its platforms help consumers search for homes, research neighborhoods and market conditions, connect with real estate professionals, and manage various steps in the home-buying, selling, renting and financing processes.

The company’s portfolio includes Zillow, Trulia, StreetEasy and HotPads, which provide property listings and real estate information. Zillow Group also offers services for real estate professionals, including marketing, lead generation, transaction management and showing coordination through products such as Zillow Premier Agent and ShowingTime+.

Through Zillow Home Loans and other affiliated services, the company provides or facilitates mortgage and closing-related solutions.