third quarter of 2026
Filed Oct 27, 2026CoStar Group Reports Record Third Quarter Revenue of $952 Million; Profitability Surges with Net Income of $74 Million; Highest Ever Adjusted EBITDA of $229 Million, Doubling Year-over-Year; Raises Full-Year 2026 Adjusted EBITDA Guidance
Third-quarter revenue increased 14% year-over-year to $952 million while net income reached $74 million versus a $31 million loss, Adjusted EBITDA doubled to $229 million, and the company increased full-year revenue, Adjusted EBITDA and Adjusted EPS guidance.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, three months ended September 30GAAP | $952M | – | 14% |
| Revenue, nine months ended September 30GAAP | $2.77B | – | – |
| Net new bookings, third quarter of 2026other | $37M | – | – |
| Cost of revenue, three months ended September 30GAAP | $211M | – | – |
| Gross profit, three months ended September 30GAAP | $741M | – | – |
| Selling and marketing expense, three months ended September 30GAAP | $366M | – | – |
| Software development expense, three months ended September 30GAAP | $109M | – | – |
| General and administrative expense, three months ended September 30GAAP | $138M | – | – |
| Customer base amortization, three months ended September 30GAAP | $44M | – | – |
| Total operating expenses, three months ended September 30GAAP | $657M | – | – |
| Income (loss) from operations, three months ended September 30GAAP | $84M | – | – |
| Net income (loss), three months ended September 30GAAP | $74M | – | up $105 million year-over-year |
| Earnings per share - diluted, three months ended September 30GAAP | $0.18 | – | – |
| Weighted-average outstanding shares - diluted, three months ended September 30GAAP | 401.9M | – | – |
| EBITDA, three months ended September 30non-GAAP | $179M | – | up $166 million year-over-year |
| Adjusted EBITDA, three months ended September 30non-GAAP | $229M | – | doubling from the prior year period |
| Adjusted Net Income, three months ended September 30non-GAAP | $153M | – | up 59% year-over-year |
| Adjusted EPS, three months ended September 30non-GAAP | $0.38 | – | up 65% year-over-year |
| Net income (loss), nine months ended September 30GAAP | $132M | – | – |
| Income (loss) from operations, nine months ended September 30GAAP | $163M | – | – |
| Earnings per share - diluted, nine months ended September 30GAAP | $0.32 | – | – |
| EBITDA, nine months ended September 30non-GAAP | $417M | – | – |
| Adjusted EBITDA, nine months ended September 30non-GAAP | $545M | – | – |
| Adjusted Net Income, nine months ended September 30non-GAAP | $375M | – | – |
| Adjusted EPS, nine months ended September 30non-GAAP | $0.92 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Commercial Real Estate, three months ended September 30Includes CoStar revenue of $344 million, LoopNet revenue of $89 million, and Other Commercial Real Estate revenue of $59 million. | $492M | – | – |
| Residential Real Estate, three months ended September 30Not specified. | $460M | – | – |
| Commercial Real Estate EBITDA, three months ended September 30Segment EBITDA. | $163M | – | – |
| Residential Real Estate EBITDA, three months ended September 30Segment EBITDA. | $16M | – | – |
| Commercial Real Estate Adjusted EBITDA, three months ended September 30Segment Adjusted EBITDA. | $180M | – | – |
| Residential Real Estate Adjusted EBITDA, three months ended September 30Segment Adjusted EBITDA. | $49M | – | – |
fourth quarter and full year 2026 outlook
- RevenueFourth quarter of 2026: $976 million to $996 million. Full year 2026: $3.75 billion to $3.77 billion.
- Tax rate26% for the full year and the fourth quarter of 2026
- NoteFull-year 2026 Adjusted EBITDA: $820 million to $840 million.
- NoteFourth-quarter 2026 Adjusted EBITDA: $275 million to $295 million.
- NoteFourth-quarter 2026 Adjusted EBITDA margin: 29% at the midpoint of the range.
- NoteFull-year 2026 revenue growth: approximately 16% year-over-year at the midpoint of the range.
- NoteFourth-quarter 2026 revenue growth: approximately 10% year-over-year at the midpoint of the range.
- NoteFull-year 2026 Adjusted EPS: $1.38 to $1.41 based on 405 million shares.
- NoteFourth-quarter 2026 Adjusted EPS: $0.46 to $0.50 based on 400 million shares.
- NoteFourth-quarter 2026 GAAP net income: $95 million to $109 million.
- NoteFull-year 2026 GAAP net income: $226 million to $241 million.
- NoteFourth-quarter 2026 EBITDA: $233 million to $253 million.
- NoteFull-year 2026 EBITDA: $651 million to $671 million.
- NoteFourth-quarter 2026 Commercial Real Estate Adjusted EBITDA: $177 million to $187 million.
- NoteFourth-quarter 2026 Residential Real Estate Adjusted EBITDA: $98 million to $108 million.
- NoteFull-year 2026 Commercial Real Estate Adjusted EBITDA: $690 million to $700 million.
- NoteFull-year 2026 Residential Real Estate Adjusted EBITDA: $130 million to $140 million.
- Note2028 Adjusted EBITDA target: $1.25 billion.
Capital returns
- Repurchases of stock were $(668) million for the nine months ended September 30, 2026.
- Repurchase of restricted stock to satisfy tax withholding obligations was $(24) million for the nine months ended September 30, 2026.
What drove it
- Revenue was $952 million, up 14% over revenue of $834 million for the quarter ended September 30, 2025.
- Net new bookings were $37 million for the quarter.
- Selling and marketing expense was $366 million, compared with $418 million in the prior-year quarter.
- General and administrative expense was $138 million, compared with $157 million in the prior-year quarter.
- Commercial Real Estate Adjusted EBITDA was $180 million and Residential Real Estate Adjusted EBITDA was $49 million.
- The company stated that total anticipated cost savings this year are approximately $150 million versus original guidance.
- The company stated it identified potential additional savings of at least $200 million expected to be realized over the next 12 to 18 months.
Concerns
- Cash and cash equivalents declined to $500 million at September 30, 2026 from $1,633 million at December 31, 2025.
- Cash paid for acquisitions, net of cash acquired was $(789) million for the nine months ended September 30, 2026.
- Long-term debt, net was $994 million at September 30, 2026.
- The company cited risks related to realizing benefits from Matterport, Domain and Zonda acquisitions and completing or realizing expected benefits from the Vexcel acquisition.
- The company cited risks from AI technologies, economic uncertainty, real estate market cyclicality, competition, data availability, cyberattacks and litigation.
What to watch
- Fourth-quarter revenue guidance of $976 million to $996 million.
- Fourth-quarter Adjusted EBITDA guidance of $275 million to $295 million and a 29% margin at the midpoint of the range.
- Execution against approximately $150 million of anticipated cost savings this year and at least $200 million of identified potential additional savings over the next 12 to 18 months.
- Commercial Real Estate and Residential Real Estate Adjusted EBITDA guidance for the fourth quarter of 2026.
- Cash use for acquisitions, campuses, other property and equipment, and stock repurchases.
Balance sheet and cash flow
- Cash and cash equivalents were $500 million at September 30, 2026, compared with $1,633 million at December 31, 2025.
- Long-term debt, net was $994 million at September 30, 2026, compared with $993 million at December 31, 2025.
- Total assets were $10,265 million at September 30, 2026, compared with $10,538 million at December 31, 2025.
- Deferred revenue was $250 million at September 30, 2026, compared with $205 million at December 31, 2025.
- Net cash provided by operating activities was $455 million for the nine months ended September 30, 2026, compared with $268 million for the nine months ended September 30, 2025.
- Cash paid for acquisitions, net of cash acquired was $(789) million for the nine months ended September 30, 2026, compared with $(2,347) million for the nine months ended September 30, 2025.
- Purchases of property, equipment, and other assets for new campuses were $(134) million for the nine months ended September 30, 2026, compared with $(246) million for the nine months ended September 30, 2025.
- Purchases of property, equipment, and other assets were $(60) million for the nine months ended September 30, 2026, compared with $(77) million for the nine months ended September 30, 2025.
- Net cash used in investing activities was $(981) million for the nine months ended September 30, 2026, compared with $(2,750) million for the nine months ended September 30, 2025.
- Net cash used in financing activities was $(706) million for the nine months ended September 30, 2026, compared with $(162) million for the nine months ended September 30, 2025.
- Cash, cash equivalents, and restricted cash at the end of the period was $500 million at September 30, 2026, compared with $2,035 million at September 30, 2025.
Analysis
CoStar reported record third-quarter revenue of $952 million, up 14% from $834 million in the prior-year period. Net new bookings were $37 million. Commercial Real Estate revenue was $492 million, including $344 million at CoStar, $89 million at LoopNet and $59 million in Other Commercial Real Estate. Residential Real Estate revenue was $460 million. The release also reported 121 million average monthly unique visitors in the third quarter of 2026.
Profitability improved sharply. GAAP net income was $74 million, compared with a net loss of $31 million in the prior-year quarter, while income from operations was $84 million compared with an operating loss of $51 million. EBITDA was $179 million compared with $13 million, and Adjusted EBITDA was $229 million compared with $114 million. Adjusted Net Income rose to $153 million from $96 million and Adjusted EPS increased to $0.38 from $0.23.
The expense profile reflected the company's efficiency initiative. Selling and marketing expense declined to $366 million from $418 million and general and administrative expense declined to $138 million from $157 million, while revenue increased. Commercial Real Estate produced $180 million of Adjusted EBITDA and Residential Real Estate generated $49 million of Adjusted EBITDA, compared with a $(69) million Adjusted EBITDA result in Residential Real Estate in the prior-year quarter. The company cited approximately $150 million of total anticipated cost savings this year versus its original guidance and identified at least $200 million of potential additional savings over the next 12 to 18 months.
Capital allocation and liquidity remain important follow-through items. For the nine months ended September 30, operating cash flow was $455 million, while acquisitions used $(789) million, campus-related property and equipment purchases used $(134) million, other property and equipment purchases used $(60) million, and stock repurchases used $(668) million. Cash and cash equivalents were $500 million at September 30, 2026, and long-term debt, net was $994 million.
Management raised its full-year 2026 outlook. Revenue guidance is $3.75 billion to $3.77 billion and Adjusted EBITDA guidance is $820 million to $840 million. Fourth-quarter guidance calls for revenue of $976 million to $996 million, Adjusted EBITDA of $275 million to $295 million, and Adjusted EPS of $0.46 to $0.50. The company stated that the full-year Adjusted EBITDA midpoint increased by $30 million from its July 2026 guidance and cumulatively by $60 million from its February 2026 guidance.
Management, verbatim
CoStar Group generated outstanding profitability growth in the third quarter, delivering on our commitment to expand margins as we exit a period of investment.
Andy Florance, Founder and Chief Executive Officer of CoStar Group
Adjusted EBITDA doubled year-over-year and was considerably above the high end of our $190 million to $210 million guidance range.
Andy Florance, Founder and Chief Executive Officer of CoStar Group
Our ongoing deep expense review has identified potential additional savings of at least $200 million that we believe will improve efficiency without sacrificing revenue growth.
Andy Florance, Founder and Chief Executive Officer of CoStar Group
Not in the filing
stated, not guessed- Gross margin for the third quarter of 2026 and comparable periods was not reported.
- Free cash flow was not reported.
- Third-quarter operating cash flow was not reported.
- Dividend amount and dividend guidance were not reported.
- A prior outlook document was not provided; therefore, row-by-row comparisons of actual results with prior guidance cannot be completed.
- Prior-year and prior-quarter percentage changes for most income statement and segment metrics were not printed.
- Revenue growth rates for individual Commercial Real Estate and Residential Real Estate segments were not printed.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.