Zillow just reported its best year ever, in nearly every way

Lending

Zillow Group, the online real estate giant that includes brands like Zillow, Trulia, SreetEasy, HotPads, and Naked Apartments, just turned in its best year ever from a revenue and traffic perspective, but still posted a net loss for the year, the company said Tuesday afternoon.

Zillow Group reported its fourth quarter and full-year 2016 financial results on Tuesday, and the company stated that it brought in more revenue than ever before in 2016.

For the full year, Zillow Group’s revenue was $846.6 million, up 31% from 2015 when its revenue was $644.7 million. For the fourth quarter, Zillow Group’s revenue was $227.6 million, up 34% year-over-year.

But despite bringing in record revenue in 2016, Zillow Group still posted a net loss for the year.

According to Zillow’s report, its GAAP net loss for 2016 was $220.4 million, which represented 24% of its revenue. The net loss was impacted by the $130 million settlement with Move, which operates Realtor.com for the National Association of Realtors and is owned by News Corp.

The settlement stemmed from allegations that Errol Samuelson, who was once Move’s chief strategy officer, stole trade secrets and proprietary information from Move before joining Zillow in 2013.

Overall, Zillow’s 2016 net loss was up from 2015’s GAAP net loss of $148.9 million.

In the fourth quarter, Zillow reported a GAAP net loss of $23.5 million, or 10% of revenue, compared to GAAP net loss of $25.7 million, or 15% of revenue, in the same period last year.

Those results are a reversal from the previous quarter, when the online real estate giant turned in its largest profit ever.

In the third quarter of 2016, Zillow actually ended a nearly three-year run in the red, posting its first quarterly profit since the fourth quarter of 2013.

According to Zillow, it posted GAAP net income of $6.8 million, or 3% of its revenue, in the third quarter of 2016, compared to GAAP net loss of $26 million, or 15% of revenue, in the same period last year.

But now, Zillow is back in the red, at least for now.

While the bottom line still may be a bit of a struggle, one place Zillow isn’t struggling is in traffic.

According to Zillow, more than 140 million average monthly unique users visited Zillow Group’s various websites during the fourth quarter of 2016, an increase of 13% year-over-year.

Traffic to Zillow Group brands’ mobile apps and websites reached an annual seasonal peak of more than 171 million unique users in May 2016, the company said.

According to Zillow Group CEO Spencer Rascoff, those figures represent record traffic for Zillow.

Rascoff said the company is pleased with its 2016 results and predicts that the company will hit $1 billion in revenue in 2017.

“Zillow Group had a fantastic year in 2016. We set records for annual revenue and site traffic, and ended on a strong note with solid fourth quarter results that were ahead of expectations,” Rascoff said.

“We executed on all of our strategic priorities for the year and completed the roll out of our self-serve account interface to premier agents nationally,” Rascoff continued. “In 2017, we are committed to further extending our audience leadership in the online real estate category. We expect to pass the $1 billion annual revenue mark in 2017, and we will press our advantage with continued investment across all Zillow Group’s brands and emerging marketplaces.”

Broken down in more detail, Zillow reported that its fourth quarter revenue increased 34% to $227.6 million, up from $169.4 million in the fourth quarter of 2015.  

The company breaks down its revenue as follows:

  • Marketplace Revenue increased 42% to $210.6 million from $148.3 million in the fourth quarter of 2015
  • Premier Agent Revenue increased 32% to $164.3 million from $124.4 million in the fourth quarter of 2015
  • Other Real Estate Revenue increased 145% to $29.8 million from $12.2 million in the fourth quarter of 2015
  • Mortgages Revenue increased 41% to $16.5 million from $11.7 million in the fourth quarter of 2015
  • Display Revenue decreased 20% to $17.0 million from $21.1 million in the fourth quarter of 2015

For the year, the company breaks down its revenue as follows:

  • Marketplace Revenue increased 40% to $778.1 million from $555.9 million in 2015
  • Premier Agent Revenue grew 35% to $604.3 million from $446.9 million in 2015
  • Other Real Estate Revenue grew 192% to $102.6 million from $35.2 million in 2015
  • Mortgages Revenue grew 61% to $71.1 million from $44.3 million in 2015
  • Display Revenue decreased 23% to $68.5 million from $88.8 million in 2015

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