[Management View]
CoStar Group reported Q2 2025 revenue of $781 million, a 15% YoY increase, marking its 57th consecutive quarter of double-digit revenue growth. Adjusted EBITDA surged 108% YoY to $85 million, exceeding guidance. Key strategic priorities include expanding the sales force, enhancing digital product offerings, and reallocating resources from underperforming segments like Matterport's VHT business to higher-return opportunities.

[Outlook]
The company raised its 2025 revenue guidance to $3.135-$3.155 billion, reflecting 15% annual growth. Adjusted EBITDA guidance was also increased to $370-$390 million. Q3 2025 revenue is expected to range between $800-$805 million, a 16% YoY increase at the midpoint. CoStar plans to close the Domain Holdings acquisition in Q3 2025, unlocking new international markets.

[Financial Performance]
- Revenue: $781M (+15% YoY)
- Adjusted EBITDA: $85M (+108% YoY)
- Net New Bookings: $93M (+65% QoQ, +38% YoY)
- Apartments.com Revenue: $292M (+11% YoY)
- Homes.com Membership Growth: +6,300 members (+56% QoQ)
- LoopNet Revenue: +8% YoY
- Matterport Revenue: $44M (beat guidance)

[Q&A Highlights]

**Question 1:** Have you observed any wallet share loss or pricing pressure at Apartments.com due to competition from Zillow?
**Answer:** Management stated there has been no loss of share or pricing pressure. Apartments.com maintains strong NPS, renewal rates, and growing bookings. Competitors are acquiring lower-quality advertisers at lower ASPs, while Apartments.com focuses on delivering leases, not just leads.

**Question 2:** What is driving the improved NPS scores for Homes.com, and where is there room for further ROI improvement?
**Answer:** The NPS improvement is attributed to better client communication, product education, and the integration of Matterport offerings. Homes.com is still in its early stages, with significant potential for further NPS and ROI growth as the sales force matures and clients better understand the platform's value.

**Question 3:** Can you elaborate on pricing trends across your business segments, including Homes.com and LoopNet?
**Answer:** Homes.com pricing is focused on penetration rather than maximizing ASP, with rates ranging from $200/month for small players to $7,500/month for larger clients. LoopNet's asset-based pricing is gaining traction, driving higher monetization per listing.

**Question 4:** What are your expectations for Homes.com membership growth for the rest of the year?
**Answer:** While specific guidance was not provided, management highlighted strong momentum, with 6,300 net new members added in Q2. The focus remains on profitable penetration growth.

**Question 5:** Is there seasonality in commercial bookings outside of Apartments.com?
**Answer:** CoStar bookings are generally stable throughout the year, with a slight lift in Q4. Apartments.com typically sees stronger bookings in Q2, and Homes.com is expected to follow a similar pattern as it matures.

**Question 6:** How is Homes.com pricing evolving, and what is the broader strategy?
**Answer:** Pricing is shifting to focus on listing-side value, asset volume, and rental portfolios. The strategy emphasizes profitable penetration growth, with plans to introduce depth advertising in the future.

**Question 7:** What is the addressable market for Homes.com, and how does the sales force align with this opportunity?
**Answer:** The addressable market includes 500,000-750,000 viable agents. With 750 sales reps planned by year-end, each rep will manage approximately 1,000 clients or prospects, emphasizing long-term relationship building and upselling opportunities.

[Sentiment Analysis]
Management displayed confidence in competitive positioning, growth potential, and strategic initiatives. Analysts were positive, commending strong results and strategic clarity, though some sought more granularity on pricing and growth metrics.

[Quarterly Comparison]
| Metric | Q2 2025 | Q1 2025 | YoY Change (%) |
|-------------------------|-----------------|-----------------|----------------|
| Revenue | $781M | $678M | +15% |
| Adjusted EBITDA | $85M | $41M | +108% |
| Net New Bookings | $93M | $56M | +65% QoQ |
| Apartments.com Revenue | $292M | $263M | +11% YoY |
| Homes.com Membership | +6,300 members | +4,000 members | +56% QoQ |

[Risks and Concerns]
1. Competitive pressures from Zillow and other players in the rental and residential markets.
2. Execution risks in integrating acquisitions like Domain Holdings and Matterport.
3. Potential macroeconomic headwinds affecting the commercial real estate market.

[Final Takeaway]
CoStar delivered a record-breaking quarter, driven by strong performance across its core segments and strategic investments in sales force expansion and product innovation. Apartments.com and Homes.com continue to differentiate through high NPS and innovative offerings, while LoopNet and international markets show promising growth. The company’s focus on profitable penetration and strategic acquisitions positions it well for sustained growth, though competitive and macroeconomic risks warrant monitoring.