Digital real estate services continued to be the driving force behind News Corp’s earnings streak, according to the company’s first-quarter fiscal 2022 earnings results released on Thursday.
Those services include realtor.com parent company Move and Australia-based REA Group, which saw revenue increases of 30 percent and 62 percent, respectively.
The media conglomerate’s revenue increased 18 percent year-over-year to $2.5 billion, as the company maintained its profitability after several quarters of net losses during the height of the pandemic. News Corp Chief Executive Robert Thomson said in a statement, “that the first quarter of Fiscal 2022 was the most profitable of its kind since the re-launch of News Corp in 2013.”
“Digital Real Estate Services was again a source of express growth, with both REA Group and Move benefiting from robust yield growth, increased audience and expansion into adjacencies,” Thomson said. “The US housing market is sturdy, with price rises, moderating more properties coming to the market and longer listing times all of which works in our favor.”
“As for the house flipping flip-flop by Zillow, we have always been focused on the digital markets, not on bricks and mortar and certainly not sorting out the septic tank or papering over wall cracks,” he added. “We’ve concentrated on our core competency and never took on excessive balance sheet risk or chase what appeared to us to be very low-margin returns.”
During Q1, Move and REA Group raked in $426 million. Move’s revenue rose 30 percent annually to $180 million thanks to continued growth with realtor.com’s referral services and lead generation products. The portal’s referral services generated 32 percent of Move’s Q1 revenue, as lead volume declined 18 percent in the midst of market normalization.
Despite the dip in lead volume, News Corp said realtor.com’s referral and lead generations services continue to be a main driver of success. “The traditional lead generation product continued to see strong demand from agents, driving improvements in sell-through and yield, while the referral model benefited from record average home values and transaction volume,” the earnings report explained.
Realtor.com’s traffic remained robust, with the site’s average monthly unique users growing 7 percent year over year to 97 million.
In a blog post released minutes after the earnings report, Realtor.com CEO David Doctorow said the platform is primed to lead the proptech space as their concierge model, traditional lead-gen and marketing products continue to grab the attention and loyalty of consumers and real estate professionals.
“I’m even more convinced that Realtor.com’s open marketplace and collaborative approach is the best path forward for everyone in the real estate industry – consumers and professionals alike,” Doctorow said. “Our business lies at the intersection of high tech and human touch, and Realtor.com aims to leverage technology to its best purpose – making it easier for people to buy, sell and rent homes and enhancing the ways in which agents, brokers, lenders and title providers support their clients and collaborate toward closing.”
“We’re playing the long game, looking market-by-market at how we can best serve agents, brokers, and the millions of buyers and sellers who visit Realtor.com every month,” he added.
The CEO also addressed the recent downfall of Zillow Offers and subsequent doubts about Zestimates, saying the company’s seller marketplace will continue to be the best place consumers can go for accurate and reliable real estate data.
“While one of our competitors recently had to shut down its iBuying program, our Seller’s Marketplace is open for business,” he said. “It’s open to iBuying companies as well as brokers with iBuyer programs, but instead of capturing homeowners and funneling them into a closed system, we help people learn about all of their options and make a choice that’s right for them – whether they decide to accept an iOffer or sell their home on the open market with an agent who can best help them.”
“Integrating and evolving technology in any industry creates tremendous opportunities for progress, but can also produce unintended, negative consequences, and the real estate industry is no exception,” he added. “That’s why Realtor.com displays three AVMs from widely respected sources on most for-sale listings on our site.”
Overall, News Corp. revenues for the quarter were $2.5 billion, while net income increased 468 percent from $47 million in Q1 2021 to $267 million in Q1 2022. The company’s EBITDA (earnings before interest, taxes, depreciation, and amortization) increased 53 percent year over year to $410 million.