Zillow Group A 2025 Q1 Earnings Strong Performance as Net Income Reverses 134.8%

Zillow Group A (ZG) reported its fiscal 2025 Q1 earnings on May 07th, 2025. The company's results exceeded expectations, with both revenue and earnings surpassing analyst projections. Zillow's guidance remains optimistic, with the company anticipating continued momentum and being well-positioned to meet its full-year 2025 objectives. The company is focused on leveraging its expanded services to drive further growth and profitability, highlighting an optimistic outlook for sustainable revenue growth and enhanced customer experiences.

Revenue
Zillow Group A's total revenue increased by 13.0% to $598 million in 2025 Q1, compared to $529 million in 2024 Q1.

Earnings/Net Income
Zillow Group A returned to profitability with an EPS of $0.03 in 2025 Q1, reversing from a loss of $0.10 per share in 2024 Q1, marking a 130.0% positive change. The company achieved a notable turnaround with a net income of $8 million in 2025 Q1, representing a 134.8% positive swing from a net loss of $23 million in 2024 Q1. This EPS recovery is a positive indicator of Zillow's financial health.

Price Action
The stock price of Zillow Group A has edged down 0.61% during the latest trading day, edged up 0.70% during the most recent full trading week, and edged up 1.71% month-to-date.

Post-Earnings Price Action Review
The investment strategy of buying Zillow Group A shares post-revenue increase quarter-over-quarter and holding for 30 days yielded a 19.23% return. However, this significantly underperformed the benchmark's impressive 84.08% return. The strategy's Sharpe ratio was notably low at 0.33, underscoring poor risk-adjusted returns. Additionally, it experienced a maximum drawdown of -12.13%, indicating its susceptibility to market downturns. This highlights the strategy's vulnerability and suggests that investors should exercise caution in relying solely on this approach, as it may not provide sufficient returns when compared to broader market performance.

CEO Commentary
"Zillow Chief Executive Officer Jeremy Wacksman expressed that the strong Q1 results exceeded expectations, showcasing effective execution. He highlighted that the company is on track to achieve its full-year 2025 goals and is poised for sustainable profitable growth. The expansion of services and the scaling of the housing super app across markets are driving increased customer engagement and simplifying transactions for buyers, sellers, and renters, which in turn fosters revenue and profit growth."

Guidance
Zillow Group anticipates continued momentum, indicating that they are well-positioned to meet their full-year 2025 objectives. The company expects to leverage its expanded services to drive further growth and profitability. Forward-looking statements suggest optimism regarding the sustainability of revenue growth, with a focus on enhancing customer experiences and market presence.

Additional News
In recent weeks, Zillow Group has not announced any major mergers or acquisitions. However, the company has been actively engaging in strategic buyback activities, repurchasing $250 million worth of shares in Q1 2025, reflecting confidence in its future prospects. No significant C-level executive changes have been reported during this period, indicating stable leadership. Additionally, Zillow's ongoing expansion of its housing super app and service offerings remains a focal point for the company, as it continues to innovate and enhance its market presence. These efforts aim to drive long-term growth and strengthen Zillow's position in the competitive real estate landscape.