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Zillow's Q1 Earnings Beat Estimates on Solid Y/Y Revenue Growth
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Key Takeaways
ZG Q1 revenues rose 18% to $708M, topping estimates on strength across all business segments.
Zillow mortgage revenues jumped 56% as purchase loan origination surged 96% year over year.
Zillow sees Q2 revenues of $750M-$765M, with rental revenues projected to grow about 30%.
Zillow Group, Inc. (ZG - Free Report) reported strong first-quarter 2026 results, with both adjusted earnings and revenues surpassing the Zacks Consensus Estimate.
The company reported an 18% year-over-year increase in total revenues, mainly driven by growth in the mortgages segment due to higher loan origination activity, with significant increases in rental revenues, especially from multifamily listings, and continued momentum in its residential and agent-focused services.
Net Income
On a GAAP basis, the company reported a net income of $46 million or 19 cents per share compared with $8 million or 3 cents per share in the year-ago quarter. Solid top-line growth primarily boosted the net income.
Non-GAAP net income in the reported quarter was $129 million or 53 cents per share compared with $105 million or 41 cents per share in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate by 10 cents.
Zillow Group, Inc. Price, Consensus and EPS Surprise
Quarterly revenues increased to $708 million from $598 million in the year-ago quarter. Healthy growth in all segments boosted the top line. The top line beat the Zacks Consensus Estimate of $704.3 million.
Residential revenues increased 8% to $450 million, backed by growth in Zillow Preferred, driven by expanded connections through Enhanced Markets and strong conversion rates for Preferred partners. Zillow Showcase and new construction also contributed to the growth.
The Mortgages segment generated $64 million in revenues compared with $41 million in the year-earlier quarter, mainly due to 96% growth in purchase loan origination as the company’s mortgage strategy is encouraging more buyers to use Zillow Home Loans.
Rental revenues rose 42% to $183 million, primarily driven by 57% increase in multifamily revenues.
Other Details
During the quarter, the company recorded a gross profit of $519 million compared with $459 million in the prior-year quarter, with respective margins of 73% and 77%. The operating expenses during the quarter were $483 million, up from $468 million in the prior-year quarter.
Adjusted EBITDA was $182 million compared with $153 million a year ago, with respective margins of 26% each.
Cash Flow & Liquidity
In the first quarter, Zillow generated $200 million in cash from operations compared with $104 million in the year-earlier quarter. As of March 31, 2026, it had $678 million in cash and cash equivalents, with $80 million of lease liabilities (net of current portion).
Outlook
For the second quarter of 2026, Zillow expects total revenues in the range of $750-$765 million. Total adjusted EBITDA is expected in the band of $150 million to $165 million. Management expects Mortgages’ revenues to grow at similar levels to the first quarter. Residential revenues are projected to grow in the mid-single-digits year over year, while rental revenues are expected to grow approximately 30% year over year.
For 2026, the company expects mid-teens revenue growth, with rental revenues up approximately 30% year over year.
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release second-quarter fiscal 2026 earnings on May 19. The Zacks Consensus Estimate for earnings is pegged at $2.33 per share, suggesting growth of 37.06% from the year-ago reported figure.
Keysight has a long-term earnings growth expectation of 17.45%. The company delivered an average earnings surprise of 4.58% in the last four reported quarters.
Workday, Inc. (WDAY - Free Report) is set to release first-quarter fiscal 2027 earnings on May 21. The Zacks Consensus Estimate for earnings is pegged at $2.49 per share, implying growth of 11.7% from the year-ago reported figure.
Workday has a long-term earnings growth expectation of 20.16%. The company delivered an average earnings surprise of 8.53% in the last four reported quarters.
Analog Devices, Inc. (ADI - Free Report) is set to release second-quarter fiscal 2026 earnings on May 20. The Zacks Consensus Estimate for earnings is pegged at $2.88 per share, implying growth of 55.7% from the year-ago reported figure.
Analog Devices has a long-term earnings growth expectation of 21.89%. The company delivered an average earnings surprise of 6.11% in the last four reported quarters.
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Zillow's Q1 Earnings Beat Estimates on Solid Y/Y Revenue Growth
Key Takeaways
Zillow Group, Inc. (ZG - Free Report) reported strong first-quarter 2026 results, with both adjusted earnings and revenues surpassing the Zacks Consensus Estimate.
The company reported an 18% year-over-year increase in total revenues, mainly driven by growth in the mortgages segment due to higher loan origination activity, with significant increases in rental revenues, especially from multifamily listings, and continued momentum in its residential and agent-focused services.
Net Income
On a GAAP basis, the company reported a net income of $46 million or 19 cents per share compared with $8 million or 3 cents per share in the year-ago quarter. Solid top-line growth primarily boosted the net income.
Non-GAAP net income in the reported quarter was $129 million or 53 cents per share compared with $105 million or 41 cents per share in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate by 10 cents.
Zillow Group, Inc. Price, Consensus and EPS Surprise
Zillow Group, Inc. price-consensus-eps-surprise-chart | Zillow Group, Inc. Quote
Revenues
Quarterly revenues increased to $708 million from $598 million in the year-ago quarter. Healthy growth in all segments boosted the top line. The top line beat the Zacks Consensus Estimate of $704.3 million.
Residential revenues increased 8% to $450 million, backed by growth in Zillow Preferred, driven by expanded connections through Enhanced Markets and strong conversion rates for Preferred partners. Zillow Showcase and new construction also contributed to the growth.
The Mortgages segment generated $64 million in revenues compared with $41 million in the year-earlier quarter, mainly due to 96% growth in purchase loan origination as the company’s mortgage strategy is encouraging more buyers to use Zillow Home Loans.
Rental revenues rose 42% to $183 million, primarily driven by 57% increase in multifamily revenues.
Other Details
During the quarter, the company recorded a gross profit of $519 million compared with $459 million in the prior-year quarter, with respective margins of 73% and 77%. The operating expenses during the quarter were $483 million, up from $468 million in the prior-year quarter.
Adjusted EBITDA was $182 million compared with $153 million a year ago, with respective margins of 26% each.
Cash Flow & Liquidity
In the first quarter, Zillow generated $200 million in cash from operations compared with $104 million in the year-earlier quarter. As of March 31, 2026, it had $678 million in cash and cash equivalents, with $80 million of lease liabilities (net of current portion).
Outlook
For the second quarter of 2026, Zillow expects total revenues in the range of $750-$765 million. Total adjusted EBITDA is expected in the band of $150 million to $165 million. Management expects Mortgages’ revenues to grow at similar levels to the first quarter. Residential revenues are projected to grow in the mid-single-digits year over year, while rental revenues are expected to grow approximately 30% year over year.
For 2026, the company expects mid-teens revenue growth, with rental revenues up approximately 30% year over year.
Zacks Rank
Zillow currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Upcoming Releases
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release second-quarter fiscal 2026 earnings on May 19. The Zacks Consensus Estimate for earnings is pegged at $2.33 per share, suggesting growth of 37.06% from the year-ago reported figure.
Keysight has a long-term earnings growth expectation of 17.45%. The company delivered an average earnings surprise of 4.58% in the last four reported quarters.
Workday, Inc. (WDAY - Free Report) is set to release first-quarter fiscal 2027 earnings on May 21. The Zacks Consensus Estimate for earnings is pegged at $2.49 per share, implying growth of 11.7% from the year-ago reported figure.
Workday has a long-term earnings growth expectation of 20.16%. The company delivered an average earnings surprise of 8.53% in the last four reported quarters.
Analog Devices, Inc. (ADI - Free Report) is set to release second-quarter fiscal 2026 earnings on May 20. The Zacks Consensus Estimate for earnings is pegged at $2.88 per share, implying growth of 55.7% from the year-ago reported figure.
Analog Devices has a long-term earnings growth expectation of 21.89%. The company delivered an average earnings surprise of 6.11% in the last four reported quarters.