CoStar Group delivers robust full-year performance, driven by strong demand for property data, expanding marketplace platforms, and improved operating leverage across its global portfolio.
CoStar Group, Inc., a leading provider of online real estate marketplaces, property information, advanced analytics, and 3D digital twin technology, delivered another year of strong top-line expansion in 2025, underscoring its long-standing record of consistent growth and operational scale. The company reported full-year revenue of $3.2 billion for the year ended December 31, 2025, representing a 19% increase compared to $2.7 billion in 2024. Fourth-quarter revenue reached $900 million, up 27% year-over-year from $709 million in the same quarter of 2024.
The results mark the company’s 59th consecutive quarter of double-digit revenue growth, reinforcing CoStar Group’s position as one of the most resilient and consistently expanding platforms in the global property technology sector.
Strong Revenue Growth Across 2025
Quarterly performance throughout 2025 demonstrated steady momentum:
- Q1 2025 revenue: $732 million
- Q2 2025 revenue: $781 million
- Q3 2025 revenue: $834 million
- Q4 2025 revenue: $900 million
The acceleration into the fourth quarter highlights continued demand across the company’s commercial and residential platforms, including strong contributions from the Homes.com Network and other portfolio brands.
Compared to 2024 quarterly revenue of $656 million, $678 million, $693 million, and $709 million respectively, the year-over-year expansion reflects both organic growth and strategic acquisitions that expanded CoStar’s product capabilities and global footprint.
Profitability Impacted by Strategic Acquisitions
While revenue performance remained robust, GAAP net income for the full year 2025 totaled $7 million, with earnings per diluted share of $0.02. Profitability was significantly impacted by acquisition-related costs tied to the Matterport and Domain transactions, along with integration expenses.
Despite the temporary drag on GAAP net income, adjusted performance metrics present a clearer view of underlying operating strength:
- Adjusted Net Income for 2025: $364 million (up 23% year-over-year)
- Adjusted EBITDA for 2025: $442 million (up 83% year-over-year)
The 83% surge in Adjusted EBITDA reflects meaningful operating leverage as the company scales its platforms and absorbs prior-year marketing and launch investments.
In the fourth quarter alone:
- Net income: $47 million
- GAAP EPS: $0.11
- Adjusted Net Income: $131 million (up 24% year-over-year)
- Adjusted EPS: $0.31 (up 19% year-over-year)
- Adjusted EBITDA: $177 million (up 58% year-over-year)
These results suggest a clear inflection in earnings power as earlier investments begin translating into stronger margin performance.
Homes.com Network Gains Significant Scale
Founder and CEO Andy Florance highlighted the strategic milestone achieved with the national launch of Homes.com and the company’s new AI initiatives. According to Florance, the heavy investment phase associated with the Homes.com brand rollout has now concluded, positioning the business for a period of “significant earnings acceleration.”
In just two years, the Homes.com Network has grown into the second-largest and fastest-growing residential portal network in the United States. During 2025, the network generated more than 2.1 billion views and averaged 108 million monthly unique visitors.
For context:
- Realtor.com reported 62 million average monthly unique users (Q4 2025, per News Corp reporting).
- Zillow Group reported 235 million average monthly unique users for full-year 2025.
With over 31,000 agent subscribers—76% of whom are on annual contracts—the Homes.com Network now generates nearly $100 million in annual run-rate revenue. The strong contractual base provides recurring revenue visibility and strengthens the residential segment’s long-term monetization profile.
Introduction of Homes AI
Florance also announced the launch of “Homes AI,” described as the most sophisticated vertical AI application in real estate. The company plans to deploy this AI capability across every platform in its portfolio.
The strategic aim is to create durable competitive differentiation by embedding artificial intelligence deeply into listing discovery, analytics, customer engagement, and transactional workflows. Management believes this technological layer will widen the competitive moat and enhance platform stickiness for both agents and consumers.
Segment Realignment Reflects Strategic Focus
In the fourth quarter of 2025, CoStar Group transitioned from a geography-based reporting structure to a product portfolio-based segmentation model. The company now reports two primary segments:
- Commercial
- Residential
This shift aligns financial reporting with how management operates the business internally and reflects the growing scale of its residential operations following recent acquisitions.
Prior-period disclosures have been recast to reflect the new presentation format.
Capital Allocation and Share Repurchase Plans
In addition to operational progress, CoStar Group continues to return capital to shareholders.
During Q4 2025, the company completed a $500 million share repurchase program initiated earlier in the year. Looking ahead to 2026, management plans to repurchase an additional $700 million in common stock under its previously authorized $1.5 billion repurchase program.
The buyback strategy signals confidence in long-term earnings growth while also helping offset share dilution from stock-based compensation.
2026 Financial Outlook
The company reaffirmed its 2026 guidance originally issued on January 7, 2026.
Full-Year 2026 Expectations
- Revenue: $3.78 billion to $3.82 billion
- Approximately 17% year-over-year growth at midpoint
- Adjusted EBITDA: $740 million to $800 million
- Implied margin of 20% at midpoint
- Adjusted EPS: $1.22 to $1.33
- Based on approximately 416 million shares
- Estimated non-GAAP tax rate: 26%
Q1 2026 Expectations
- Revenue: $890 million to $900 million
- Approximately 22% year-over-year growth at midpoint
- Adjusted EBITDA: $95 million to $115 million
- Adjusted EPS: $0.16 to $0.19
- Based on 419 million shares
CFO Chris Lown noted that Adjusted EBITDA margins are expected to expand progressively throughout 2026, driven by revenue seasonality at Domain and the timing of marketing expenditures.
Understanding Non-GAAP Measures
CoStar Group provides several non-GAAP financial measures to give investors a clearer understanding of core operating performance.
- EBITDA: GAAP net income (loss) before interest, taxes, depreciation, and amortization.
- Adjusted EBITDA: EBITDA excluding stock-based compensation, acquisition and integration costs, restructuring costs, and non-recurring settlement or impairment expenses.
- Adjusted Net Income: GAAP net income adjusted for stock-based compensation, acquisition-related items, restructuring costs, amortization of acquired intangibles, and other specified adjustments, net of an assumed tax rate.
- Adjusted EPS: Adjusted Net Income divided by diluted shares outstanding.
Management believes these measures better reflect underlying business trends and provide comparability across periods, particularly in years involving major acquisitions and integration costs.
Operating Metrics and Subscription Momentum
The company continues to track net new bookings as a key operating metric. Net new bookings represent the annualized change in subscription-based contracts, incorporating new sales, contract expansions, and cancellations.
While not a direct substitute for revenue analysis, this metric offers insight into forward-looking recurring revenue potential, particularly important given CoStar’s subscription-driven business model.
Strategic Positioning Entering 2026
CoStar Group enters 2026 with:
- Accelerating adjusted profitability
- Expanding residential scale
- Integrated 3D digital twin capabilities via Matterport
- Growing AI-powered product differentiation
- Significant capital return commitments
- A balanced commercial and residential portfolio
The completion of major acquisitions and the national Homes.com rollout positions the company to shift from heavy investment mode into earnings acceleration. Management’s guidance implies expanding margins and sustained double-digit revenue growth, reinforcing long-term growth visibility.
With nearly six decades of consecutive quarterly double-digit revenue growth now achieved, CoStar Group continues to demonstrate its ability to scale across property information, analytics, and digital marketplaces.
As artificial intelligence, digital property modeling, and integrated data ecosystems become increasingly central to real estate transactions, CoStar Group’s strategic investments appear designed to strengthen competitive positioning and expand long-term shareholder value.
