Zillow Posts Profit Beat as Housing Boom Drives Web Traffic
(Bloomberg) -- Zillow Group Inc. reported better-than-expected results for the first quarter, as the white-hot housing market fueled 2.5 billion visits to the company’s websites and apps.
Scrolling Zillow has become a go-to activity for Americans stuck at home pondering real estate upgrades as low interest rates and a shortage of homes to buy fuel the pandemic housing market.
Zillow posted adjusted earnings before interest, taxes, depreciation and amortization of $181 million, according to a statement Tuesday. That beat the average analyst estimate of $131 million.
Zillow’s Premier Agent marketing operation, which sells leads to real estate agents, brought in $334 million in revenue, up 38% from the year before.
The strong housing market didn’t stop Zillow from acquiring houses for its nascent home-flipping business, called Zillow Offers. The company acquired 1,856 homes in the quarter, the most since the third quarter of 2019.
Zillow makes light repairs to the homes and then lists them for sale. The operation lost $58 million in the first quarter.
“We’re seeing a record number of people raise their hands and say they want a Zillow Offer,” Chief Executive Officer Rich Barton said in an interview. “Speed, certainty and convenience are reliable bets, even in a hot market.”
Zillow shares gained in late trading. The stock had slipped 8.9% this year through Tuesday’s close, after nearly tripling in 2020.
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