Zillow Group First Quarter 2017 Financial Results Highlights
First Quarter 2017 Financial Highlights
- Total Revenue increased 32% yoy to a record $245.8M and exceeded the high end of the guidance range.
- Premier Agent Revenue increased 30% yoy to $175.3M.
- The number of Premier Agent accounts spending more than $5,000 per month grew by 98% yoy and increased 86% on a total dollar basis.
- Total sales to Premier Agent advertisers who have been customers for more than one year increased 54% yoy.
- Sales to existing Premier Agent advertisers accounted for 63% of total bookings.
- Other Real Estate Revenue[1] increased 93% to $34.8M.
- Mortgages Revenue increased 23% to $20.3M.
- Display Revenue decreased 9%, as expected, to $15.4M.
- GAAP net loss was $4.6M, or 2% of Revenue, compared to GAAP net loss of $47.6M, or 26% of Revenue, in 1Q16.
- Adjusted EBITDA[2] was $54.8M, or 22% of Revenue, an increase from $1.9M, or 1% of Revenue, in 1Q16.
Operating and Business Highlights
- More than 166M average monthly unique users visited Zillow Group brands’ mobile apps and websites during 1Q17, an increase of 7% yoy, and an all-time high of nearly 180M unique users visited in March 2017.
- Visits to Zillow Group brands’ mobile apps and websites, Zillow, Trulia and, beginning in March 2017, StreetEasy, increased 18% yoy to more than 1.5B in 1Q17. Premier Agent Revenue per visit increased 10% yoy.
- Contacts sent to Premier Agents grew 30% yoy in 1Q17.
- Zillow Group Rentals Revenue grew by more than 100% yoy.
- Zillow Group launched a new brand, RealEstate.com, designed for millennial home shoppers.
Business Outlook
- Zillow Group raised its outlook for the full year.
- FY17 Revenue is expected to be in the range of $1.050B to $1.065B, which represents an increase of 25% at the midpoint.
- FY17 Adjusted EBITDA is expected to be in the range of $215M to $230M, which represents 21% of Revenue at the midpoint.
- The following table presents Zillow Group’s business outlook for the periods presented:
- A reconciliation of forecasted Adjusted EBITDA to forecasted net loss is provided in the press release in the “Quarterly Results” section of Zillow Group’s Investor Relations website.
Forward-Looking Statements
This communication contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that involve risks and uncertainties, including, without limitation, statements regarding our business outlook and future operational plans. Statements containing words such as “may,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “project,” “will,” “projections,” “continue,” “business outlook,” “forecast,” “estimate,” “outlook,” “guidance,” or similar expressions constitute forward-looking statements. Actual results may differ materially. For information about potential factors that may affect Zillow Group’s business and financial results, please review the “Risk Factors” described in Zillow Group, Inc.’s Annual Report on Form 10-K for the year ended December 31, 2016 filed with the Securities and Exchange Commission, or SEC, and in Zillow Group’s other filings with the SEC. Except as may be required by law, Zillow Group does not intend, and undertakes no duty, to update this information to reflect future events or circumstances.
Use of Non-GAAP Financial Measures
This communication includes discussion of Adjusted EBITDA, which is a non-GAAP financial measure not prepared in conformity with accounting principles generally accepted in the United States (“GAAP”). This non-GAAP financial measure is not prepared under a comprehensive set of accounting rules and, therefore, should only be reviewed alongside results reported under GAAP.
We urge you to review our earnings press release as it contains important information about our financial results, including reconciliation tables and related information about this non-GAAP financial measure. The earning press release is available on the Investor Relations section of the Zillow Group website at http://investors.zillowgroup.com/releases.cfm. It is also included as Exhibit 99.1 to our Current Report on Form 8-K as furnished to the SEC on May 4, 2017, which is available on the Investor Relations section of the Zillow Group website at http://investors.zillowgroup.com/sec.cfm and the SEC’s website at www.sec.gov.
[1] Other Real Estate Revenue primarily includes Zillow Group Rentals, agent services, dotloop, Naked Apartments, and other offerings to endemic advertisers that are not traditional display advertising, including New Construction, which includes advertising services for homebuilders.
[2] A reconciliation of Adjusted EBITDA to net loss is provided in the press release in the “Quarterly Results” section of Zillow Group’s Investor Relations website.