Zillow Group A 2025 Q2 Earnings Beats Expectations, Net Income Surges 111.8%

Zillow Group A (ZG) reported its fiscal 2025 Q2 earnings on Aug 06th, 2025. The company exceeded expectations with a strong revenue beat and a significant turnaround in profitability. Management raised confidence for the future, signaling strategic momentum and innovation as key drivers for continued growth.

Revenue
Zillow Group A’s total revenue surged 14.5% year over year to $655 million in Q2 2025, driven by robust performance across core segments. Residential revenue grew to $434 million, supported by expanding agent and software offerings and the New Construction marketplace. Mortgages revenue rose 41% year over year to $48 million, fueled by a 48% increase in purchase loan origination volume. Rentals revenue also saw strong growth, hitting $159 million, with multifamily revenue surging 56%. The "Other" segment contributed $14 million, completing the company’s diverse revenue profile.

Earnings/Net Income
Zillow Group A returned to profitability with an EPS of $0.01 in Q2, a dramatic 114.3% improvement from a loss of $0.07 in the prior-year period. Net income reached $2 million, a 111.8% positive swing from a $17 million net loss in Q2 2024. This turnaround was driven by strong revenue growth and disciplined cost management.

Price Action
The stock has gained 2.88% on the latest trading day, 6.72% over the week, and surged 15.73% month-to-date, reflecting investor optimism.

Post-Earnings Price Action Review
A strategy of buying Zillow Group A shares after a revenue beat on the earnings date and holding for 30 days has historically delivered strong returns. Over the past three years, it returned 87.33%, outperforming the 49.40% benchmark by 37.93%. This strategy also demonstrated solid risk-adjusted returns, with a 23.55% CAGR and zero maximum drawdown, indicating strong performance with minimal downside risk.

CEO Commentary
Zillow CEO Jeremy Wacksman highlighted the company’s strategic execution and innovation as key drivers of growth. He noted that the company not only surpassed revenue expectations but also delivered Adjusted EBITDA at the high end of its outlook range. Wacksman emphasized innovation in real estate tools and the company’s ability to outpace industry growth, with Q2 revenue rising 15% year over year to $655 million—well ahead of the residential real estate industry's 1–2% growth.

Guidance
Zillow Group reported that Q2 revenue outperformed industry growth estimates from Zillow and NAR and indicated expectations for Q3 with a focus on revenue growth, cost management, and continued innovation. While specific Q3 metrics were not disclosed, the company plans to provide full guidance in its shareholder letter and during a scheduled conference call. Cash and investments declined to $1.2 billion due to $419 million in convertible note settlements and $150 million in share repurchases.

Additional News
Zillow Group announced the settlement of $419 million in convertible notes in May 2025 and executed $150 million in share repurchases, reflecting a strategic approach to capital management. The company also reported strong traffic growth, with average monthly unique users increasing 5% year over year to 243 million in Q2. Visits to Zillow Group’s mobile apps and websites rose 4% year over year to 2.6 billion. The company will host a live webcast today to discuss the results, offering further insights into its financial outlook and strategic direction.