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Will CoStar's Earnings & Revenue Beat in Q2 Drive the Stock Price?
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Key Takeaways
CSGP's Q2 earnings of $0.17 per share beat estimates by 21.43% and rose 13.3% year over year.
Revenue grew 15.3% to $781.3M, with strength in Information Services and Other Marketplace segments.
CSGP raised full-year revenue guidance to $3.135B-$3.155B, targeting 15% growth at the mid-point.
CoStar Group (CSGP - Free Report) reported non-GAAP earnings of 17 cents per share in the second quarter of 2025, which surpassed the Zacks Consensus Estimate by 21.43%. The company registered earnings of 15 cents per share in the year-ago quarter, increasing 13.3% year over year.
Revenues of $781.3 million beat the Zacks Consensus Estimate by 1.25% and increased 15.3% year over year. This represents the company’s 57th consecutive quarter of double-digit revenue growth. The upside was driven by robust performance in key segments.
CSGP raised its top-line guidance for the third quarter of 2025 based on the second quarter of 2025 results, which bodes well for investors. The company’s shares have also gained 18.9% against the Zacks Computer and Technology sector’s decline of 10.6% in the year-to-date period.
CSGP’s Top-Line Details
CoStar’s revenues (34.7% of revenues) of $270.9 million beat the consensus estimate by 1.12% and increased 7.1% year over year.
CoStar Group, Inc. Price, Consensus and EPS Surprise
In the second quarter of 2025, CoStar Group sites reached 141 million average monthly unique visitors, while the Homes.com Network attracted 111 million.
Information Services’ revenues (5% of revenues) of $39.3 million beat the consensus mark by 6.97% and increased 17.7% year over year.
Multifamily revenues (37.4% of revenues) of $292 million missed the consensus estimate by 0.33% but increased 10.6% year over year.
LoopNet’s revenues (9.7% of revenues) of $75.7 million beat the consensus mark by 1.41% and increased 8.5% year over year.
Second-quarter residential revenues (3.6% of revenues) were $28.4 million, which missed the consensus mark by 8.45% and increased 8.4% year over year.
Other marketplace revenues (9.6% of revenues) of $74.7 million beat the consensus mark by 48.81% and increased 139.4% year over year.
CoStar’s Operating Details
In the reported quarter, selling and marketing expenses increased 10.2% year over year to $394.9 million. As a percentage of revenues, selling and marketing expenses were 50.5% compared with 52.9% in the year-ago quarter.
General and administrative expenses, as a percentage of revenues, contracted 60 basis points (bps) on a year-over-year basis to 15.6%.
Software development expenses, as a percentage of revenues, expanded 70 bps, while Customer base amortization expenses rose 190 basis points year over year.
Operating expenses increased 14.8% year over year to $640.7 million. As a percentage of revenues, operating expenses decreased 30 bps year over year to 82%.
Adjusted EBITDA was $85 million compared with the year-ago quarter’s $40.8 million. The adjusted EBITDA margin expanded 490 bps to 10.9%.
CSGP’s Balance Sheet & Cash Flow Statement
CoStar reported cash and cash equivalents of $3.62 billion as of June.30, 2025, compared with $3.68 billion as of March 31, 2025.
The company had a long-term debt of $992.5 million as of June 30, 2025, compared with $992.2 million as of March 31, 2025.
Cash generated by operating activities was $199.7 million in the reported quarter compared with $53.2 million in the previous quarter.
CSGP Initiates Q3 & 2025 Guidance
For the third quarter of 2025, the company expects revenues between $800 million and $805 million, indicating year-over-year growth of 16% at the mid-point.
The company anticipates adjusted EBITDA between $75 million and $85 million for the third quarter of 2025.
For 2025, revenues are expected to be between $3.135 billion and $3.155 billion, indicating year-over-year growth of 15% at the mid-point.
The company anticipates adjusted EBITDA between $370 million and $390 million for 2025.
Image: Bigstock
Will CoStar's Earnings & Revenue Beat in Q2 Drive the Stock Price?
Key Takeaways
CoStar Group (CSGP - Free Report) reported non-GAAP earnings of 17 cents per share in the second quarter of 2025, which surpassed the Zacks Consensus Estimate by 21.43%. The company registered earnings of 15 cents per share in the year-ago quarter, increasing 13.3% year over year.
Revenues of $781.3 million beat the Zacks Consensus Estimate by 1.25% and increased 15.3% year over year. This represents the company’s 57th consecutive quarter of double-digit revenue growth. The upside was driven by robust performance in key segments.
CSGP raised its top-line guidance for the third quarter of 2025 based on the second quarter of 2025 results, which bodes well for investors. The company’s shares have also gained 18.9% against the Zacks Computer and Technology sector’s decline of 10.6% in the year-to-date period.
CSGP’s Top-Line Details
CoStar’s revenues (34.7% of revenues) of $270.9 million beat the consensus estimate by 1.12% and increased 7.1% year over year.
CoStar Group, Inc. Price, Consensus and EPS Surprise
CoStar Group, Inc. price-consensus-eps-surprise-chart | CoStar Group, Inc. Quote
In the second quarter of 2025, CoStar Group sites reached 141 million average monthly unique visitors, while the Homes.com Network attracted 111 million.
Information Services’ revenues (5% of revenues) of $39.3 million beat the consensus mark by 6.97% and increased 17.7% year over year.
Multifamily revenues (37.4% of revenues) of $292 million missed the consensus estimate by 0.33% but increased 10.6% year over year.
LoopNet’s revenues (9.7% of revenues) of $75.7 million beat the consensus mark by 1.41% and increased 8.5% year over year.
Second-quarter residential revenues (3.6% of revenues) were $28.4 million, which missed the consensus mark by 8.45% and increased 8.4% year over year.
Other marketplace revenues (9.6% of revenues) of $74.7 million beat the consensus mark by 48.81% and increased 139.4% year over year.
CoStar’s Operating Details
In the reported quarter, selling and marketing expenses increased 10.2% year over year to $394.9 million. As a percentage of revenues, selling and marketing expenses were 50.5% compared with 52.9% in the year-ago quarter.
General and administrative expenses, as a percentage of revenues, contracted 60 basis points (bps) on a year-over-year basis to 15.6%.
Software development expenses, as a percentage of revenues, expanded 70 bps, while Customer base amortization expenses rose 190 basis points year over year.
Operating expenses increased 14.8% year over year to $640.7 million. As a percentage of revenues, operating expenses decreased 30 bps year over year to 82%.
Adjusted EBITDA was $85 million compared with the year-ago quarter’s $40.8 million. The adjusted EBITDA margin expanded 490 bps to 10.9%.
CSGP’s Balance Sheet & Cash Flow Statement
CoStar reported cash and cash equivalents of $3.62 billion as of June.30, 2025, compared with $3.68 billion as of March 31, 2025.
The company had a long-term debt of $992.5 million as of June 30, 2025, compared with $992.2 million as of March 31, 2025.
Cash generated by operating activities was $199.7 million in the reported quarter compared with $53.2 million in the previous quarter.
CSGP Initiates Q3 & 2025 Guidance
For the third quarter of 2025, the company expects revenues between $800 million and $805 million, indicating year-over-year growth of 16% at the mid-point.
The company anticipates adjusted EBITDA between $75 million and $85 million for the third quarter of 2025.
For 2025, revenues are expected to be between $3.135 billion and $3.155 billion, indicating year-over-year growth of 15% at the mid-point.
The company anticipates adjusted EBITDA between $370 million and $390 million for 2025.
CSGP’s Zacks Rank & Stocks to Consider
CoStar currently carries a Zacks Rank #3 (Hold).
Allegro Micro Systems (ALGM - Free Report) , Alkami Technology (ALKT - Free Report) and Meta Platforms (META - Free Report) are some better-ranked stocks that investors can consider in the broader Computer and Technology sector.
Allegro Micro Systems, Alkami Technology and Meta Platforms each sport a Zacks Rank of 1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Allegro Micro Systems shares have gained 65.8% year to date. ALGM is scheduled to release first-quarter fiscal 2026 results on July 31.
Alkami Technology shares have plunged 23.3% year to date. ALKT is set to report its second-quarter 2025 results on July 30.
Meta Platforms shares have returned 20.5% year to date. META is scheduled to release second-quarter 2025 results on July 30.