CoStar Group Raises Annual Revenue Forecast, Q2 Earnings Beat Estimates

CoStar Group has received FIRB approval notification for its proposed acquisition of Domain Holdings Australia. The company has also raised its annual revenue forecast as net bookings climb. Q2 adjusted earnings and revenue rose, and the company issued guidance for Q3 and the full year. Various analysts have adjusted their price targets for CoStar Group, with some maintaining a buy rating.

CoStar Group, Inc. (NASDAQ: CSGP) has secured Foreign Investment Review Board (FIRB) approval for its proposed acquisition of Domain Holdings Australia Ltd. (AU: DHG). The acquisition, structured as a scheme of arrangement, is now subject to shareholder and court approvals. Domain Holdings Australia Limited operates in the real estate industry, primarily focusing on property listings and related services.

The acquisition comes as CoStar Group reported strong second-quarter 2025 results, with revenue increasing by 15% year-over-year to $781 million. Net income was $6.2 million, and adjusted EBITDA reached $85 million, up 108% from the previous year. The company also announced its quarterly net new bookings of $93 million, a 65% increase from the prior quarter.

CoStar Group has raised its annual revenue forecast to a range of $3.135 billion to $3.155 billion for the full year 2025, representing a 15% year-over-year growth. The company expects revenue for the third quarter 2025 to be in the range of $800 million to $805 million, representing a 16% year-over-year growth. Adjusted EBITDA guidance for the full year 2025 has been increased to a range of $370 million to $390 million.

Analysts have responded positively to CoStar Group's results. BMO Capital has raised its price target for CoStar Group to $89.00, while maintaining a Market Perform rating. Needham raised its price target to $105, Citi to $100, and Goldman Sachs to $105, all with a Buy rating. JPMorgan increased its price target to $101, reflecting a positive growth outlook.

The acquisition of Domain Holdings Australia Ltd. is expected to enhance CoStar Group's presence in the Australian real estate market, potentially leading to increased market share and revenue growth. However, the success of the acquisition will depend on the outcomes of shareholder and court approvals.

References:
[1] https://www.tipranks.com/news/company-announcements/domain-holdings-gains-firb-approval-for-costar-acquisition
[2] https://www.ainvest.com/news/bmo-capital-maintains-market-perform-costar-group-raises-pt-89-2507/
[3] https://investors.costargroup.com/news-releases/news-release-details/costar-group-q2-revenue-increases-15-year-over-year-achieves-all