Financial Trends -- 7/10
Zillow presents a strong financial profile in a historically weak housing market. Total revenue
grew +15.5% in FY2025 to $2.58B, with Rentals accelerating to +39% and Mortgages at +37%.
Adj. EBITDA expanded ~200bps to 24.1%, and the company achieved its first year of GAAP
profitability ($23M net income). FCF was $420M (16.3% margin). The main offsets are decelerating
Residential growth (+7%), persistent gross margin erosion (81% to 74% over four years), and
razor-thin GAAP profitability. Growth is real and company-specific, outpacing the housing market
by 1,000-1,500+ bps annually.
Weight: 25%
FY2025 Revenue
$2,583M
+15.5% YoY | Q4 exiting at +18.1%
FY2025 Adj. EBITDA
$622M
+24.9% YoY | 24.1% margin
FY2025 Adj. FCF
$420M
16.3% FCF margin | First disclosure year
FY2025 GAAP EPS
$0.09
First profitable year | From -$0.48
Revenue Trajectory (USD M, Quarterly)
Quarterly revenue accelerated through FY2025. Revenue grew
from $529M in Q1 2024 to $676M in Q3 2025, with YoY growth improving from +12.8% to +18.1% by
Q4 2025. This is notable given existing home sales remain depressed at ~4M (vs. 5.5-6M normal).
Zillow is outgrowing the housing market by 1,000-1,500+ bps per year through Enhanced Markets,
Rentals expansion, and mortgage integration. Consensus expects FY2026 revenue of ~$2.97B (+15%).
| Metric | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue ($M) | $469M | $506M | $496M | $474M | $529M | $572M | $581M | $554M | $598M | $655M | $676M | $654M |
| YoY Growth | — | — | — | — | 12.8% | 13.0% | 17.1% | 16.9% | 13.0% | 14.5% | 16.4% | 18.1% |
FY2023: $1,945M | FY2024: $2,236M (+15.0%) | FY2025: $2,583M (+15.5%). Data sourced from Daloopa.
Segment YoY Growth Trends (Quarterly)
Rentals is the standout -- accelerating from +24% to +45% YoY.
Rentals grew from +24.2% in Q3 2024 to +44.8% in Q4 2025, now representing 24% of total revenue
($630M). Multifamily was up 63% in Q4. Mortgages remained strong at +32-41% with purchase origination
volume up 67% YoY in Q4. Residential, the largest segment at 66% of revenue, decelerated from ~+11%
to ~+7% but still outperformed the housing market. The divergence between accelerating Rentals/Mortgages
and decelerating Residential is the key dynamic.
Data sourced from Daloopa.
Segment Revenue (Annual, USD M)
Revenue mix shifting toward higher-growth segments.
Rentals grew from $274M (14% of rev) in FY2022 to $630M (24%) in FY2025, a 130% increase in three
years. Mortgages doubled from $96M to $199M. Meanwhile, Residential grew only 12% over the same period
($1,522M to $1,704M). This mix shift drives gross margin erosion (higher-COGS segments growing faster)
but diversifies Zillow away from pure dependence on for-sale housing transactions.
| Metric | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|
| Residential ($M) | $1,522M | $1,452M | $1,594M | $1,704M |
| Residential YoY | — | -4.6% | 9.8% | 6.9% |
| Rentals ($M) | $274M | $357M | $453M | $630M |
| Rentals YoY | — | 30.3% | 26.9% | 39.1% |
| Mortgages ($M) | $119M | $96M | $145M | $199M |
| Mortgages YoY | — | -19.3% | 51.0% | 37.2% |
| Total Revenue ($M) | $1,958M | $1,945M | $2,236M | $2,583M |
| Total YoY Growth | -8.2% | -0.7% | 15.0% | 15.5% |
FY2021 total rev: $2,132M (ex-Homes/iBuying). Segment splits not available pre-FY2022. Data sourced from Daloopa.
Margin Trends
EBITDA margins expanding while gross margins erode -- a mixed signal.
Adj. EBITDA margin expanded from 20.1% (FY2023) to 24.1% (FY2025), gaining ~200bps/year through cost
discipline. The company targets continued expansion in FY2026. However, gross margin has declined
consistently from 81.3% (FY2022) to 74.1% (FY2025) as higher-COGS segments (Rentals, Mortgages) grow
faster. This is a structural mix shift, not an execution issue. The EBITDA expansion despite gross margin
compression shows strong operating leverage below the gross profit line.
| Metric | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|
| Gross Profit ($M) | $1,591M | $1,524M | $1,709M | $1,915M |
| Gross Margin | 81.3% | 78.4% | 76.4% | 74.1% |
| Adj. EBITDA ($M) | $514M | $391M | $498M | $622M |
| EBITDA Margin | 26.3% | 20.1% | 22.3% | 24.1% |
| EBITDA YoY | — | -23.9% | 27.4% | 24.9% |
| Net Income ($M) | $-101M | $-158M | $-112M | $23M |
| Diluted EPS | $-0.42 | $-0.68 | $-0.48 | $0.09 |
FY2025 marks first GAAP-profitable year ($23M net income, $0.09 EPS). Data sourced from Daloopa.
Quarterly Adj. EBITDA ($M) & YoY Growth
| Metric | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | Q3 2025 | Q4 2025 |
|---|---|---|---|---|---|---|---|---|
| Adj. EBITDA ($M) | $125M | $134M | $127M | $112M | $153M | $155M | $165M | $149M |
| EBITDA Margin | 23.6% | 23.4% | 21.9% | 20.2% | 25.6% | 23.7% | 24.4% | 22.8% |
| EBITDA YoY | 20.2% | 20.7% | 18.7% | 62.3% | 22.4% | 15.7% | 29.9% | 33.0% |
| Net Income ($M) | $-23M | $-17M | $-20M | $-52M | $8M | $2M | $10M | $3M |
| Diluted EPS | $-0.10 | $-0.07 | $-0.08 | $-0.22 | $0.03 | $0.01 | $0.04 | $0.01 |
Q4 2024 EBITDA YoY of +62.3% reflects an easy comp. Data sourced from Daloopa.
Consensus Estimates vs. Actuals
| Metric | FY2025A | FY2026E | FY2027E |
|---|---|---|---|
| Revenue | $2,583M | ~$2,970M (+15%) | ~$3,400M (+14%) |
| Adj. EBITDA | $622M (24.1%) | ~$770M (~26%) | ~$930M (~27%) |
| Diluted EPS | $0.09 | Improving | Improving |
| Revenue Target | Management targets +$1.5B incremental revenue before any housing recovery | ||
Street expects sustained mid-teens growth independent of housing recovery.
Consensus embeds continued 15%+ revenue growth driven by Rentals and Mortgages, with EBITDA margin
expanding toward the mid-to-high 20s. Management has framed a $1.5B incremental revenue opportunity
(to ~$4.1B) achievable without any normalization in existing home sales. Enhanced Markets and
Zillow Home Loans adoption are the key execution vectors.
Consensus estimates approximate. Management targets $1.5B incremental rev before housing recovery. Data sourced from Daloopa.
Free Cash Flow (FY2025)
| Metric | Q3 2025 | Q4 2025 | FY 2025 |
|---|---|---|---|
| Operating Cash Flow | $105M | $72M | $368M |
| Capex | ($32M) | ($28M) | ($133M) |
| Adj. Free Cash Flow | $107M | $125M | $420M |
| FCF Margin | 16.3% | ||
$420M adj. FCF at 16.3% margin in first year of disclosure.
FCF was newly disclosed in FY2025. The 16.3% FCF margin on $2.58B revenue is strong for a marketplace
business still investing in growth. Note that adj. FCF ($420M) exceeds operating cash flow ($368M),
suggesting adjustments for items like stock-based compensation or working capital timing.
FCF series newly reported in FY2025. Data sourced from Daloopa.
Traffic KPIs & Share Count
Traffic stabilized while monetization improved; share count rose from converts.
Visits recovered +3.1% YoY in 2025 to 9.6B after declining in 2023-2024. Average monthly unique users
grew +6.3% to 235M. Revenue per visit is expanding as Zillow monetizes through Enhanced Markets.
Diluted share count rose to 254M in FY2025 despite $2.6B in cumulative buybacks at ~$50 avg price,
due to convertible note dilution now that the company is GAAP-profitable. Basic shares have declined.
$2.6B cumulative share repurchases. Convert dilution offsets buybacks on diluted basis. Data sourced from Daloopa.
Acceleration / Deceleration Analysis
| Signal | Detail | Direction |
|---|---|---|
| Total Revenue | +15.0% (FY2024) to +15.5% (FY2025); slight acceleration (+50bps). Intra-year: +13.0% Q1 to +18.1% Q4 | Accelerating |
| Residential | ~+10% (FY2024) to ~+7% (FY2025); decelerating but outperforming market by 1,500+ bps | Decelerating |
| Rentals | +27% (FY2024) to +39% (FY2025); Q4 at +45%. Now 24% of rev. Multifamily +63% in Q4 | Accelerating |
| Mortgages | +51% (FY2024) to +37% (FY2025); decelerating from high base but still strong | Decelerating (from high) |
| Gross Margin | 81.3% (FY2022) to 74.1% (FY2025); persistent 4-year decline from mix shift | Eroding |
| EBITDA Margin | 20.1% (FY2023) to 24.1% (FY2025); +~200bps/year expansion. Company targeting continued gains | Expanding |
| GAAP Profitability | First profitable year: $23M net income ($0.09 EPS) vs. -$112M in FY2024 | Inflection |
Score Derivation
| Factor | Assessment | Impact |
|---|---|---|
| Revenue growth | 15%+ sustained for 2 years despite historically weak housing market | Base 7 |
| Rentals acceleration | 39% growth, 24% of rev, structural long-duration driver | +0.5 |
| Revenue outgrowth vs. market | Consistently outperforming housing market by 1,000-1,500+ bps | +0.5 |
| GAAP profitability inflection | First profitable year, but barely ($23M on $2.6B rev) | +0.5 |
| FCF generation | $420M adj. FCF (16% margin) in first year of disclosure | +0.5 |
| Housing market headwind | Existing home sales ~4M vs. 5.5-6M normal; rates elevated; tariff uncertainty | -0.5 |
| Gross margin erosion | 4-year declining trend from 81% to 74% as mix shifts | -0.5 |
| Share repurchases | $2.6B cumulative, but diluted count rose from converts; net neutral | 0 |
| Residential deceleration | Core segment (66% of rev) slowed from +10% to +7% | -0.5 |
| Final Score | Solid above-market growth with improving profitability, offset by GM erosion and macro | 7/10 |
Data sourced from Daloopa and company earnings call transcripts (Q3 2024 - Q4 2025). Screener period: March 2026.