CoStar Group Q2 Earnings Call Highlights

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CoStar Group (NASDAQ:CSGP) reported second-quarter 2026 revenue of $925 million, up 18% from a year earlier, while adjusted EBITDA more than doubled to $184 million. The company said the quarter marked a profitability inflection point as it limited operating-cost growth to 2% while continuing investments across its commercial real estate, residential and spatial-data businesses.

Founder and CEO Andrew Florance said net income increased 817% year over year and EBITDA rose 441%. CoStar recorded its 61st consecutive quarter of double-digit revenue growth and maintained its full-year adjusted EBITDA outlook of $780 million to $820 million, which would represent the company’s highest annual adjusted EBITDA result.

Commercial segment growth led by CoStar and LoopNet

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Commercial revenue rose 8% year over year to $481 million, while commercial adjusted EBITDA increased 7% to $172 million. CoStar’s core platform generated $337 million of revenue, up 9%, with subscribers increasing 19% to 327,000. Renewal rates were 93%, and net new bookings from brokers increased 48% year over year, including a multiyear renewal from the company’s largest brokerage client.

LoopNet revenue increased 14% to $87 million. U.S. paid listings rose 9% to 220,000, while paid listings grew 24% in Canada and 52% in the United Kingdom. The company expanded the LoopNet sales force to 225 representatives from 191 a year earlier.

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CoStar Debt Solutions delivered more than $4 million in net new monthly bookings, up 96% year over year, according to Florance. The business is developing benchmarking tools using anonymized and aggregated data from 300 lender clients, representing more than 100,000 active loans and over $1.2 trillion of outstanding debt.

Other commercial revenue declined 5% to $57 million, primarily because of lower transaction volumes at Ten-X. CoStar is restructuring Ten-X, reducing costs by $7 million year to date while revenue declined by $4 million during the process. The company plans to separate Ten-X from LoopNet with dedicated sales, marketing and leadership teams.

During the quarter, CoStar launched rent-benchmark data based on 4 million AI-abstracted lease documents, introduced its CoStar platform in France, added U.K. public-record search capabilities and extended AI-powered lease abstraction into CoStar Real Estate Manager. The company continues to target a second-half 2026 launch of CoStar in Australia.

Residential segment reaches positive EBITDA

Residential revenue increased 33% year over year to $444 million. The residential segment posted record adjusted EBITDA of $12 million, its first profitable quarter since Homes.com launched in the first quarter of 2024. The company said the result reflected personnel-cost reductions, operational efficiencies and early benefits from AI initiatives.

Apartments.com revenue rose 9% to $318 million. Paid properties increased 12% to nearly 93,000, while monthly renewal rates remained at 99%. Average revenue per property was down about 3.6% year over year, which Florance attributed primarily to a mix shift toward smaller communities with lower pricing.

Management said apartment owners remain price sensitive amid elevated supply, widespread concessions and competitive pricing. Florance said CoStar is maintaining pricing discipline, citing third-party analysis that found Apartments.com leads converted to leases at 2.5 times the rate of the next closest competitor.

Homes.com revenue grew 66% to $28.5 million, reaching an annualized run rate of $116 million at quarter-end. Agent subscribers more than doubled year over year to over 36,000, while the average subscriber price rose to $305 in June. The monthly cancellation rate declined to 2.4% from 6.5% a year earlier.

The company plans to introduce a Platinum marketing tier for Homes.com during the third quarter. The offering will include enhanced search placement, social marketing, photography, drone imagery and Matterport tours. Florance said CoStar expects higher-value advertising products, which it refers to as depth advertising, to become a significant source of future Homes.com revenue.

CoStar reduced Homes.com inside sales representatives from 660 at the end of 2025 to about 400, while expanding its field sales team to 50 representatives across Washington, D.C., Tampa, Atlanta, Dallas and Chicago. Management said production per representative increased 19%, and Homes.com net new bookings remained consistent with the first quarter despite the reduction in sales headcount.

Guidance revised for revenue, maintained for EBITDA

Chief Financial Officer Christian Lown said CoStar revised its full-year 2026 revenue outlook to $3.715 billion to $3.755 billion, representing 15% growth at the midpoint. Commercial revenue is expected to be $1.94 billion to $1.96 billion, while residential revenue is projected at $1.775 billion to $1.795 billion.

The company said its lower revenue outlook reflects the Ten-X restructuring, Homes.com sales-force optimization and Apartments.com’s decision to maintain pricing rather than pursue lower-priced competitive offerings. CoStar nevertheless reaffirmed its full-year adjusted EBITDA outlook of $780 million to $820 million and adjusted earnings-per-share guidance of $1.32 to $1.39.

For the third quarter, CoStar expects revenue of $935 million to $945 million and adjusted EBITDA of $190 million to $210 million. The company projected commercial adjusted EBITDA of $162 million to $172 million and residential adjusted EBITDA of $28 million to $38 million.

CoStar repurchased 2.4 million shares for $82.1 million during the second quarter, bringing year-to-date repurchases to 13.75 million shares for $587 million. The company expects $700 million of total share repurchases in 2026.

Zonda deal and CFO transition

CoStar continues to expect its acquisition of new-home construction data and marketplace provider Zonda to close in the second half of 2026, subject to regulatory approval. The company said its guidance does not include any financial contribution from the transaction.

Lown said this would be his final earnings call as CoStar’s CFO before joining Allstate in the same role. Florance announced that Robin Rossmann, who has led CoStar businesses internationally, will succeed Lown as chief financial officer.

About CoStar Group (NASDAQ:CSGP)

CoStar Group, Inc is a provider of information, analytics and online marketplaces for the commercial real estate industry. The company gathers property-level data, builds market analytics and supplies research tools used by brokers, owners, lenders, investors and other real estate professionals to evaluate markets, track inventory and manage listings. CoStar's offerings are delivered primarily through subscription-based platforms that combine proprietary databases, mapping and workflow applications to support decision-making across the property life cycle.

In addition to its core CoStar research service, the company operates prominent online listing and marketing platforms that connect buyers, sellers, tenants and brokers.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected].

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