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Why Is CoStar (CSGP) Down 3% Since Last Earnings Report?
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It has been about a month since the last earnings report for CoStar Group (CSGP - Free Report) . Shares have lost about 3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is CoStar due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for CoStar Group, Inc. before we dive into how investors and analysts have reacted as of late.
CoStar Group Q2 Earnings Beats Estimate, Revenue Increased Y/Y
CoStar Group 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’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.
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.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -35.9% due to these changes.
VGM Scores
Currently, CoStar has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for value investors.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, CoStar has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is CoStar (CSGP) Down 3% Since Last Earnings Report?
It has been about a month since the last earnings report for CoStar Group (CSGP - Free Report) . Shares have lost about 3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is CoStar due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent catalysts for CoStar Group, Inc. before we dive into how investors and analysts have reacted as of late.
CoStar Group Q2 Earnings Beats Estimate, Revenue Increased Y/Y
CoStar Group 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’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.
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.
How Have Estimates Been Moving Since Then?
Since the earnings release, investors have witnessed a downward trend in estimates revision.
The consensus estimate has shifted -35.9% due to these changes.
VGM Scores
Currently, CoStar has a poor Growth Score of F, however its Momentum Score is doing a lot better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for value investors.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, CoStar has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.