Zillow raked in $1.3 billion in revenue between April and June of this year, besting its haul from also-impressive recent quarters, though the company also saw its overall profit fall from previous highs, the company announced Thursday in a second-quarter earnings report.
The online giant’s report revealed that in total it saw a net income of about $10 million in the second quarter of 2021. That’s up compared to one year ago, when Zillow suffered a net loss of nearly $85 million — and when the coronavirus was first impacting the housing market. However, it’s down compared to the first quarter of 2021, when the company pulled in $52 million in net income, as well as compared to the final quarter of 2020, when net income hit $46 million.
Both of those previous two quarters were, respectively, the most profitable on record for Zillow.
While net income lagged during the second quarter of the year, Zillow did see revenue soar 70 percent year over year, ultimately hitting $1.3 billion. That beat analysts’ expectations that the company would report $1.27 billion in revenue.
Significantly, analysts had expected profitability to be down thanks to more spending on product development and advertising.
In the report, Zillow co-founder and CEO Rich Barton framed his company’s latest earnings figures as part of a long term strategy.
“Zillow is making rapid and significant progress toward building a seamless, integrated real estate experience for our customers and partners,” Barton said in a statement that was included in the report. “Our strong second-quarter results show how well we’re executing on the three- to five-year growth objectives we announced in 2019.”
Thursday’s report also shows that Zillow’s iBuying business has grown significantly over the last year. In total, the company brought in more than $772 million in revenue from its Zillow Offers program during the quarter, which was an increase of 70 percent year over year. That’s also up from last quarter, when iBuying scored the company nearly $701 million in revenue.
Barton singled out Zillow Offers in the report, saying the program “continues to accelerate as we offer more customers a fast, fair, flexible and convenient way to move.”
“Zillow Offers is proving attractive to sellers even in this sizzling-hot seller’s market,” he continued.
In a call with investors, Barton also said Zillow bought 3,805 homes during the second quarter, while it sold 2,086. The company is also on track to be purchasing 5,000 homes per month in the near future, and according to Barton consumers who previously thought of Zillow merely as a portal are “starting to understand and take advantage of the reality that we now offer so much more.”
Barton added during the call that even in a hot market, Zillow Offers’ value proposition has remained “more than durable.”
Premier Agent — Zillow’s lead generation program for real estate professionals — was another standout in the report, with revenue from the program hitting $348 million. That’s up 82 percent compared to the same period last year.
Zillow also brought in $56 million from its mortgage segment. While that number pales in comparison to the figures from iBuying and lead sales, it’s also a 68 percent year-over-year jump.
Zillow stock spent most of Thursday treading water in the lead up to the report, ultimately closing down very slightly for the day at $110.30 per share. After the report came out, the company’s share price bounced around in after hours trading, but ultimately ended up higher than the day’s closing price.
When trading ended Thursday, Zillow had a market cap of just over 27 billion.
Barton ultimately concluded in Thursday’s report that current market trends should ultimately favor Zillow.
“We expect millennial-buyers, low interest rates, and the increasing adoption of location-flexible work policies, to fuel interest in moving for many years to come,” he said. “And these movers will increasingly demand e-commerce-like solutions where Zillow excels.”
Update: This post was updated after publication with additional information from Zillow’s earnings report, and from an investor call with company leaders.