By Shaina Mishkin

Home sales have been stuck at low levels, but Zillow Group's revenue is growing regardless. That didn't stop the stock from falling immediately after the company reported first-quarter earnings and second-quarter guidance.

The real estate listings and technology company on Wednesday reported 19 cents a share under generally accepted accounting principles, or GAAP, standards on $708 million in revenue, up 18% from one year prior. Analysts polled by FactSet had expected a 10 cent per-share profit on $705 million in revenue. Its adjusted earnings before interest, taxes, depreciation, and amortization, or Ebitda, was $182 million, beating the roughly $168 million expected by analysts.

Investors were likely more focused on the company's second-quarter guidance. Zillow expects revenue in a range from $750 million to $765 million in its second quarter, about in-line with consensus expectations calling for $761 million, but its second-quarter adjusted Ebitda expectations, in a range of $150 million to $165 million, is lower than the $190 million consensus foresees.

Zillow stock was down 9% in after-hours trading shortly following the report after closing 2.3% higher on Wednesday.

The results come as Zillow continues to integrate its varied businesses. "For consumers, we connect marketing, search, renting, touring, financing and closing into a single, coherent experience interwoven with professional workflows," CEO Jeremy Wacksman and Chief Financial Officer Jeremy Hofmann wrote in a letter to investors.

Revenue expanded across product categories. Residential revenue, which includes its for-sale agent services businesses and software, grew 8% to $450 million. Zillow's revenue from its mortgage business increased 56% to $64 million, while rentals revenue was up 42% to $183 million.

Legal costs and ramped-up advertising spending are headwinds to Ebitda in the current quarter, Hofmann said. "That said, when we look at the first half in aggregate, we are right on plan," he said, noting that the company is reiterating its expectations for full-year revenue growth in the mid-teens and expanding Ebitda margins.

Zillow's results came "against a housing market that was essentially flat," the letter stated. Indeed, existing-home sales measured by the National Association of Realtors have remained in a relatively weak range as buyers remain stretched and mortgage rates swing.

"We have proven time and again, this quarter included and what we expect to occur into the future, that we can grow revenue quite nicely, expand margins even further, and expand net income even further than that, regardless of the housing market," Hofmann said to Barron's in a Wednesday interview.

Write to shaina.mishkin@dowjones.com

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May 06, 2026 16:28 ET (20:28 GMT)

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