It feels like an understatement to say that News Corp. Chief Executive Officer Robert Thomson is bullish on the future of realtor.com. News Corp. is the parent corporation of such companies as Dow Jones and The Wall Street Journal — and Move, Inc., which operates the real estate portal realtor.com. And the portal is clearly one of the jewels in News Corp.’s fiscal crown.
- News Corp.'s total revenue declined by $100 million year-over-year.
- However, realtor.com was once more mentioned as a very successful News Corp. product, with revenues increasing 35 percent year-over-year.
- Enhanced listings for Realtors and more integrated collaboration with other News Corp. products were named as future opportunities for the company.
It feels like an understatement to say that News Corp. Chief Executive Officer Robert Thomson is bullish on the future of realtor.com.
News Corp. is the parent corporation of such companies as Dow Jones and The Wall Street Journal — and Move, Inc., which operates the real estate portal realtor.com. And the portal is clearly one of the jewels in News Corp.’s fiscal crown.
“We are particularly pleased by the early returns at Move, which we acquired just over a year ago and whose realtor.com network has become the fastest-growing player in the still-emerging U.S. digital real estate market,” said Thomson in the latest News Corp. earnings call (for the second quarter in the 2016 fiscal year).
“The quarter presented challenges,” noted Thomson at the beginning of the call. He blamed the year-over-year revenue decline on “foreign currency fluctuations.”
The losses were not insignificant. Year-over-year, total News Corp. revenue was down by about $100 million. The company reported $2.16 billion in revenue for this quarter, compared to $2.26 billion in the same quarter last year.
But you wouldn’t know that by looking at the digital real estate services revenue — which grew 35 percent, according to News Corp. “The successful integration of realtor.com and growth of REA contributed materially to our performance,” Thomson said, adding that realtor.com had become the “world’s largest player” in digital real estate services “by most measures.”
Thomson said that he expects News Corp.’s global digital real estate presence to grow as REA works to acquire IProperty, the “preeminent digital property company” in Southeast Asia.
For the quarter, average monthly unique users increased by 37 percent year-over-year to approximately 39 million users, driven by a 57 percent boost in mobile users, said Thomson. For some perspective — in January 2016, Thomson said realtor.com clocked 50 million monthly unique visitors, compared to 30 million in October 2014, the month before News Corp. acquired Move.
“We are significantly ahead of schedule in revenue growth and in the trajectory of EBITDA (earnings before interest, taxes, depreciation and amortization) for Move,” said Thomson. “Even with the investment required to enhance the site, we firmly expect positive EBITDA for this fiscal year. That result will not come at the expense of investment in the product or the brand and should be the harbinger of increasing EBITDA in coming years.”
Later in the call, Thomson praised the portal again, stating that realtor.com’s success is indicative of News Corp.’s future financial health. “We are particularly pleased that realtor.com has been transformed, and through its success, is transforming the character of News Corp.,” he said.
No pressure, Move!
For the most recent quarter, Move’s revenue expanded 35 percent year-over-year on a standalone basis. “User engagement continued to grow briskly,” noted Thomson, who said that both pageviews and minutes on the site have increased significantly.
News Corp.’s digital real estate services were definitely in the black in Q2. Total digital real estate services revenue increased 35 percent — $54 million. And Move’s revenue as a company also increased 35 percent year-over-year, from $65 million to $87 million.
The parent corporation attributed this growth to the Connection for Co-Brokerage product, non-listing media revenue and market share gains for Top Producer.
How realtor.com wraps in with other products — and what’s next
The real estate portal was brought up several times during the call, including Thomson’s recap of News Corp.’s print journalism assets.
Advertising year-over-year at The Wall Street Journal was “softer,” according to Thomson, who added, “it’s worth pointing out that the real estate categories showed significant ad strength,” driven digitally by Mansion Global and in print by the Mansion residential section, he said.
And this performance is “highlighting the value that News Corp. brings to Realtors and the efficacy of the relationship with realtor.com,” said Thomson. “We believe these complimentary platforms are clearly worth more than the sum of their parts.”
He noted that News Corp. is using the portal to boost its other products, too — like Checkout 51, a digital coupon app that Thomson said now has more than 5 million users. That’s at least partially due to realtor.com; Thomson said that News Corp. was “using our powerful platforms, including realtor.com, to drive adaptation of the app.”
Thomson alluded to some changes coming to the portal that he said would be geared toward Realtors — like enhanced listings and mining Move’s relationship with CoStar, which provides information for commercial and multifamily real estate, to help Realtors keep tabs on renters in multifamily units who might be looking to buy.
“Importantly, we are now in a position to share learnings, mobile software and display modules across our digital property platforms to ensure we optimize the experience for users and the revenue for our customers,” said Thomson.
And even though News Corp. has notoriously deep pockets, Bedi A. Singh, News Corp.’s chief financial officer, did mention that $4 million was spent in Q2 on the ongoing litigation with real estate portal Zillow.