Zillow stock falls after Q4 earnings miss

Investing.com -- Zillow Group Inc (NASDAQ: ZG) stock dropped 4% in after-hours trading Tuesday following the company's fourth-quarter earnings report that slightly missed analyst expectations.

The real estate marketplace reported earnings per share of $0.39, falling short of the $0.40 consensus estimate. Revenue came in at $654 million, narrowly beating the $650.23 million analysts had projected and representing an 18% increase from the same quarter last year.

Despite the earnings miss, Zillow's quarterly revenue approached the high end of the company's outlook range. For the full year 2025, Zillow reported revenue of $2.6 billion, up 16% year over year, significantly outperforming the broader residential real estate industry, which grew by just 3% according to NAR data.

The company's performance was driven by strong growth across its business segments. Rentals revenue surged 45% YoY to $168 million, with multifamily revenue growing 63%. For Sale revenue increased 11% YoY to $475 million, while Mortgages revenue jumped 39% to $57 million, fueled by a 67% increase in purchase loan origination volume.

"We delivered strong results in the fourth quarter and throughout 2025, achieving all our reported full-year financial targets, including positive net income, while continuing to gain share in both For Sale and Rentals," said Zillow Chief Executive Officer Jeremy Wacksman. "As we celebrate 20 years of Zillow, our results demonstrate our disciplined and consistent execution of our strategy. With our deeply engaged audience, industry-leading software that powers industry workflows, and two decades of AI innovation, we are uniquely positioned to drive durable growth by making the entire moving journey easier for consumers and the real estate professionals who serve them."

On a GAAP basis, Zillow reported net income of $3 million for the fourth quarter, with a net income margin of 0%, representing a 990-basis-point improvement from the previous year.

Traffic to Zillow's platforms grew 8% YoY to 221 million average monthly unique users during the quarter, while visits increased 2% to 2.1 billion.

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