According to Zillow’s latest earnings report, the company’s full year consolidated revenue increased 158 percent year-over-year, culminating in a record $943.9 million that surpassed the $810 million expected by analysts. Zillow’s full-year consolidated revenue more than doubled year-over-year to $2.7 billion, and the real estate company ended 2019 with $2.4 billion in cash, cash equivalents and investments after posting a $0.26 loss—a win over the predicted -$0.30.
Following the release of its earnings report on Wednesday, Feb. 19, Zillow Group Inc. shares gained more than 8 percent in after-hours trading, closing at a 53-week high of $54.47, according to MarketWatch.
What’s driving these numbers? Zillow’s Premier Agent continued on its path of accelerated growth in the fourth quarter, ending the year with $923.9 million in revenue, compared to $898.3 million in 2018—a 3 percent increase. Its Rentals segment, however, saw the biggest increase at 22 percent, up from $134.6 million in 2018 to $164.1 million in revenue for 2019.
“Our Premier Agent business is solid, and we have started 2020 with some of the best retention rates we’ve seen in recent history,” said Rich Barton, Zillow’s CEO and co-founder, in a statement.
Zillow Offers, the company’s iBuyer arm, continues expanding, adding to the company’s revenue growth—the company stepped into the Los Angeles market in December, bringing the service to a total of 23 markets. In Q4 of 2019, Zillow Offers sold 1,902 homes and purchased 1,787, ending with an inventory surplus of 2,707 homes. The “Homes” segment, brought in the most revenue in Q4, increasing by 1.4 percent since 2018 to $603.2 million.
“In all, I’d characterize 2019 as tumultuously remarkable,” said Barton. “We’re in the midst of a multi-year expansion to rewire real estate transactions and streamline how our customers buy, sell, rent and borrow that dramatically expands our market opportunity and profit potential. Our team’s strong execution delivered record Q4 and full-year results that beat our outlook on every measure.”
They lost $5000 on every home they bought. Let’s see how long that lasts
What was their ‘net profit’? Gross revenue is one thing, profit is another.
Exactly what does Zillow do to benefit the average realtor? Do they have a real estate license in any state?
Thank you for stealing and selling our leads.
Interesting how Realtors (specifically the Premiere Agent subscribers, like me) were responsible for $923.9M of Zillow’s revenue and yet the CEO does not consider us Realtors as his customers. He says, “We’re in the midst of a multi-year expansion to rewire real estate transactions and streamline how our customers buy, sell, rent and borrow.” Maybe he is referring to the end user here, but I hope Zillow appreciates the Realtors who purchase Zillow’s advertising products; and I worry if Zillow is going to alienate the source of almost $1B in revenue by ‘rewiring real estate transactions’ (read: cut out the agent and go straight to the consumer).
Come on Inman! When are you going to post what really counts – profit? I can make all the money in the world, but if I spend more than I take in, that really doesn’t matter, does it. This has been consistent with Inman, so the headlines are consistently misleading.
Excellent comment. Dennis. That is exactly what I thought of on their comment of “streamlining how our customers…” translated into cutting realtors out. And, yes, we should be considered their “customers” as we pay them. Remember, Amazon did not make a profit for several years, but their deep pockets enabled them to corner the purchasing market first.
Thank you NAR for selling us out. What is it again that they do for us?
I just divested from Zillow, and I’ve never felt so free.
Zillow has convinced me (twice) that I would get better leads and grow my business by becoming a Premier Agent and spending my hard earned commission on their platform. NEVER AGAIN. What a waste of money! AND why should I fund their war-chest so they can eventually sideline me and other Realtors. Say “NO” to Zillow.
I am a REALTOR, and that fact that some of you all have sold out to Zillow, and we as Realtors, have allowed our industry, in the NEW BUYER, to believe that ZILLOW IS THE SOURCE FOR REAL ESTATE, is our fault as REALTORS, …….
I personally, as a broker have not and do not advertise, and will not on Zillow….. because those of you who have, and do, have sold our souls as REALTORS and if you do not think this technology ultimatle will not cut you our you are living in a pipe dream… it will happen, it is coming, and we are to blame or those of you who have signed agreements to allow Zillow to adverise your listings and sell to up to 3 agents to advertise and be the name and number to call about your listing.
YES IS IS ABSOLUTELY LUDICROUS THAT WE AS AN INDUSTRY HAVE ALLOWED THIS TO HAPPEN….REALTORS AS A WHOLE, SHOULD COME TOGETHER, RAISE OUR DUES TO WHATEVER NECESSARY TO BECOME THE SOURCE FOR REAL ESTATE AND ADVERTISE AS SUCH, AND REPLACE WHAT ZILLOW HAS CREATED…. YES IT WOULD TAKE MILLIONS… BUT WE COULD DO IT, AND CONTROL OUR FUTURE……
IF WE DONT, WE WILL NOT BE NEEDED IN THE NEAR FUTURE…..AND WILL BE BYPASSED. IF WE CONTROL OUR DATA, THEN WE WILL BE THE SOURCE FOR REAL ESTATE, ZILLOW IS NOT ACCURATE, AND WE ALL KNOW THAT BUT ASK ANYONE UNDER 40 WHERE THEY GO TO GET THEIR VALUES, FIND A REALTORS, OR INQUIRE ABOUT A HOME AND YOU WILL FIND IT IS ZILLOW, AND THEY ACTUALLY BELIEVE THIS IS ACCURATE DATA, AND THE WAY TO BUY A HOME.
A FRIEND OF MY DAUGHTER JUST BOUGHT A HOME, SHE IS IN HER 30’S AND FOUND HER AGENT ON ZILLOW…..AS SHE JUST THOUGHT THIS IS HOW YOU DO IT…. WELL THATS FINE FOR NOW, BUT SOON WE WILL NOT BE NEEDED.
REALTORS NEED TO COME TOGETHER ACROSS THE COUNRTY EVERY BOARD, AND BRING ALL THE MLS TOGETHER AND CONTROL THEIR DATA AND RECREATE WHAT ZILLOW HAS BASICALLY CREATED, BUT SELL THE ADVERTISING BACK TO US AS REALTORS AT LEAST, AND THEN ALLOW YOU AS THE LISING AGENT TO BE THE ONLY ADVERTISER OF YOUR LISTING….. OF COURSE FOR A GOOD FEE…..
I PERSONALLY BELIEVE IN OUR PROFESSION, HAVE BEEN IN THE BUSINESS SINCE I WAS TEENAGER, NOW A BUILDER, AND HAVE SOLD MILLIONS OF DOLLARS WORTH OF HOMES BUT I HATE SEEING WHERE OUR BUSINESS IS GOING RIGHT BEFORE OUR EYES, AND WE ARE SELLING OUR SOULS TO DO IT….. I REPEAT TO MY OWN DETRIMENT, I DO NOT ADVERTISE ON ZILLOW, AND WILL NOT…. BUT ALL THAT DO…. I PERSONALLY AND I THINK THOSE THAT ARE PROFESSIONAL FULL TIME REALTOS LIKE ME WOULD PAY HANDSOMELY TO ADVERTISE OUR PROFESSION AND BECOME THE NEW REAL SOURCE FOR REAL ESTATE…
IF YOU WOULD BE INTERESTED, IN ASSISTING YOUR BOARD IN GETTING TOGETHER NATION WIDE WITH A THE NAR…. ON THIS SAME GOAL PLEASE RESPOND HERE, AND WE WILL BEGIN TO MAKE A MOTION TO OWN OUR OWN DESTINY…. GUESS WHAT THIS NEW SITE AND BUSINESS SHOULD BE OWNED MUTUALLY BY ALL THE MLS /REALTOR BOARDS ACROSS THE COUNTRY JUST LIKE THE NFL… SHARES WITH ITS OWNERS…..IT WOULD BE OWNED BY OUR OWN PROFESSION.
LETS NOT SELL OUT…. STOP SELLING OUT……
If the model of Zillow bothers Realtors too much why don’t they stop buying leads? can a realtor please explain?
“Zillow’s home-buying business spends $1.40 for each $1 of revenue it receives. The firm makes most of its revenue selling leads on buyers to agents it is partnered with.” Source: Finance & Economics Section, Economist Magazine Feb 15th 2020 edition
They are making more money due to the increase in cost for leads. I use to buy leads from Zillow many years ago when it was affordable. It has quadrupled in cost over the last 14 years. I refuse to participate in that model and ended my relationship 4 years ago. It is up to us as Realtors to educate our customers and clients about the inaccuracies of the information on Zillow. We as Realtors are still the best source.