SEATTLE, Feb. 10, 2021 /PRNewswire/ -- Zillow Group,
Inc. (NASDAQ:Z and ZG), which is transforming the way people buy,
sell, rent and finance homes, today announced its consolidated
financial results for the three months ended and year ended
December 31, 2020.
Complete financial results, and outlook for the first quarter of
2021, can be found in the company's shareholder letter on the
Investor Relations section of Zillow Group's website at
https://investors.zillowgroup.com/investors/financials/quarterly-results/default.aspx.
"Zillow's strong results reflect exemplary execution and
continued growth during the scary roller-coaster ride that was
2020," said Zillow Group co-founder and CEO Rich Barton. "Many Americans who had previously
dreamed of moving now have the flexibility to do so, and they
flocked to Zillow in record numbers. We are investing aggressively
in new technology and services to help them move. Our customers are
hungry for the kind of seamless experience that we can now provide
at Zillow, and we are poised to capitalize on our strong position
in 2021."
Recent highlights include:
- Consolidated fourth quarter revenue of $789 million and revenue for each segment
exceeded the high end of the company's outlook for the fourth
quarter. Full-year 2020 consolidated revenue grew 22%, despite the
negative impact of COVID-19 on results during the first half of
2020.
- On a GAAP basis, consolidated net income was $46 million for the fourth quarter and a net loss
of $162 million for full year 2020.
Segment income (loss) before income taxes was $145 million, $(67)
million and $7 million for the
IMT, Homes and Mortgages segments, for the fourth quarter, and
$263 million, $(320) million and $5
million, for full year 2020, respectively.
- Fourth-quarter Adjusted EBITDA exceeded the high end of the
company's outlook for all three segments, resulting in consolidated
Adjusted EBITDA of $170 million.
Consolidated Adjusted EBITDA was $343
million for full year 2020, driven primarily by Adjusted
EBITDA margin expansion in the IMT segment, along with improved
Mortgages and Homes segment margins.
- Traffic to Zillow Group's mobile apps and websites reached a
fourth-quarter record of 201 million average monthly unique users,
an increase of 16% year over year, driving 2.2 billion visits
during the quarter, up 27% year over year. The company reported a
record 9.6 billion visits for the full year 2020, up 19% year over
year.
- The company exited 2020 with cash and investments of
$3.9 billion.
Fourth-Quarter and Full-Year 2020 Financial
Highlights
The following table sets forth Zillow Group's financial
highlights for the periods presented (in thousands, unaudited):
|
Three Months
Ended
December 31,
|
|
2019 to 2020
% Change
|
|
Year Ended
December 31,
|
|
2019 to 2020
% Change
|
|
2020
|
|
2019
|
|
|
2020
|
|
2019
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
Homes
segment
|
|
|
|
|
|
|
|
|
|
|
|
Zillow
Offers
|
$
301,703
|
|
$
603,228
|
|
(50)%
|
|
$
1,710,535
|
|
$
1,365,250
|
|
25 %
|
Other (1)
|
2,442
|
|
-
|
|
N/A
|
|
4,840
|
|
-
|
|
N/A
|
Total Homes segment
revenue
|
304,145
|
|
603,228
|
|
(50)%
|
|
1,715,375
|
|
1,365,250
|
|
26 %
|
IMT
segment:
|
|
|
|
|
|
|
|
|
|
|
|
Premier
Agent
|
314,213
|
|
233,482
|
|
35 %
|
|
1,046,954
|
|
923,876
|
|
13 %
|
Other (2)
|
109,625
|
|
86,183
|
|
27 %
|
|
403,278
|
|
353,020
|
|
14 %
|
Total IMT segment
revenue
|
423,838
|
|
319,665
|
|
33 %
|
|
1,450,232
|
|
1,276,896
|
|
14 %
|
Mortgages
segment
|
60,969
|
|
21,054
|
|
190 %
|
|
174,210
|
|
100,691
|
|
73 %
|
Total
revenue
|
$
788,952
|
|
$
943,947
|
|
(16)%
|
|
$
3,339,817
|
|
$
2,742,837
|
|
22 %
|
Other Financial
Data:
|
|
|
|
|
|
|
|
|
|
|
|
Segment income (loss)
before income taxes:
|
|
|
|
|
|
|
|
|
|
|
|
Homes
segment
|
$
(66,621)
|
|
$
(107,923)
|
|
|
|
$
(320,254)
|
|
$
(312,120)
|
|
|
IMT
segment
|
145,369
|
|
36,221
|
|
|
|
262,984
|
|
80,060
|
|
|
Mortgages
segment
|
7,305
|
|
(12,654)
|
|
|
|
4,514
|
|
(44,962)
|
|
|
Total segment income
(loss) before income taxes
|
$
86,053
|
|
$
(84,356)
|
|
|
|
$
(52,756)
|
|
$
(277,022)
|
|
|
Net income
(loss)
|
$
46,036
|
|
$
(101,210)
|
|
|
|
$
(162,115)
|
|
$
(305,361)
|
|
|
Adjusted EBITDA
(3):
|
|
|
|
|
|
|
|
|
|
|
|
Homes
segment
|
$
(46,890)
|
|
$
(82,525)
|
|
|
|
$
(241,969)
|
|
$
(241,326)
|
|
|
IMT
segment
|
203,093
|
|
87,659
|
|
|
|
556,137
|
|
303,863
|
|
|
Mortgages
segment
|
13,648
|
|
(8,311)
|
|
|
|
28,825
|
|
(23,653)
|
|
|
Total Adjusted
EBITDA
|
$
169,851
|
|
$
(3,177)
|
|
|
|
$
342,993
|
|
$
38,884
|
|
|
Percentage of
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
Segment income (loss)
before income taxes:
|
|
|
|
|
|
|
|
|
|
|
|
Homes
segment
|
(22)%
|
|
(18)%
|
|
|
|
(19)%
|
|
(23)%
|
|
|
IMT
segment
|
34 %
|
|
11 %
|
|
|
|
18 %
|
|
6 %
|
|
|
Mortgages
segment
|
12 %
|
|
(60)%
|
|
|
|
3 %
|
|
(45)%
|
|
|
Total segment income
(loss) before income taxes
|
11 %
|
|
(9)%
|
|
|
|
(2)%
|
|
(10)%
|
|
|
Net income
(loss)
|
6 %
|
|
(11)%
|
|
|
|
(5)%
|
|
(11)%
|
|
|
Adjusted
EBITDA:
|
|
|
|
|
|
|
|
|
|
|
|
Homes
segment
|
(15)%
|
|
(14)%
|
|
|
|
(14)%
|
|
(18)%
|
|
|
IMT
segment
|
48 %
|
|
27 %
|
|
|
|
38 %
|
|
24 %
|
|
|
Mortgages
segment
|
22 %
|
|
(39)%
|
|
|
|
17 %
|
|
(23)%
|
|
|
Total Adjusted
EBITDA
|
22 %
|
|
- %
|
|
|
|
10 %
|
|
1 %
|
|
|
|
(1) Other Homes
segment revenue relates to revenue associated with the title and
escrow services provided through Zillow Closing
Services.
|
(2) Other IMT segment
revenue includes revenue generated by rentals, new construction and
display advertising, as well as revenue from the sale of various
other advertising and business technology solutions for real estate
professionals, including dotloop.
|
(3) Adjusted EBITDA
is a non-GAAP financial measure; it is not calculated or presented
in accordance with U.S. generally accepted accounting principles,
or GAAP. See below for more information regarding our presentation
of Adjusted EBITDA, including a reconciliation of Adjusted EBITDA
to the most directly comparable GAAP financial measure, which is
net income (loss) on a consolidated basis and income (loss) before
income taxes for each segment, for each of the periods
presented.
|
Conference Call and Webcast Information
Zillow Group CEO & co-founder Rich
Barton and CFO Allen Parker
will host a live conference call to discuss the results today at
2 p.m. Pacific Time (5 p.m. Eastern Time). A shareholder letter and
link to both the live webcast and recorded replay of the call may
be accessed on the Quarterly Results section of Zillow Group's
investor relations website. Participants must register in advance
at: https://dpregister.com/sreg/10150693/dfabe47e70 using
conference ID 10150693 to receive emailed instructions. This
process is designed to reduce delays due to operator congestion
when accessing the live call.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934 that involve
risks and uncertainties, including, without limitation, statements
regarding the future performance and operation of our business and
the current and future health and stability of the residential
housing market and economy and our expectations regarding future
shifts in behavior by consumers and employees. Statements
containing words such as "may," "believe," "anticipate," "expect,"
"intend," "plan," "project," "predict," "will," "projections,"
"continue," "estimate," "outlook," "guidance," "would," "could," or
similar expressions constitute forward-looking statements.
Forward-looking statements are made based on assumptions as of
February 10, 2021, and although we
believe the expectations reflected in the forward-looking
statements are reasonable, we cannot guarantee these results.
Differences in Zillow Group's actual results from those described
in these forward-looking statements may result from actions taken
by Zillow Group as well as from risks and uncertainties beyond
Zillow Group's control. Factors that may contribute to such
differences include, but are not limited to, the impact of the
COVID-19 pandemic or other public health crises and any associated
economic downturn on Zillow Group's future financial position,
operations and financial performance; the magnitude, duration and
severity of the COVID-19 pandemic and the availability and
widespread distribution and use of effective vaccines; the impact
of actions taken by governments, businesses and individuals in
response to the COVID-19 pandemic, including changes in laws or
regulations that limit Zillow Group's ability to operate; the
current and future health and stability of the economy, financial
conditions and residential housing market, including any extended
slowdown in the real estate markets as a result of the COVID-19
pandemic or changes that reduce demand for Zillow Group's products
and services, lower Zillow Group's profitability or reduce Zillow
Group's access to credit; Zillow Group's ability to execute on
strategy; Zillow Group's ability to maintain and effectively manage
an adequate rate of growth; Zillow Group's ability to innovate and
provide products and services that are attractive to its users and
advertisers; Zillow Group's investment of resources to pursue
strategies that may not prove effective; Zillow Group's ability to
compete successfully against existing or future competitors; the
impact of pending or future legal proceedings, including those
described in Zillow Group's filings with the Securities and
Exchange Commission, or SEC; Zillow Group's ability to successfully
integrate and realize the benefits of its past or future strategic
acquisitions or investments; Zillow Group's ability to comply with
MLS rules and requirements to access and use listing data, and to
maintain or establish relationships with listings and data
providers; the ability of Zillow Group to operate its mortgage
originations business, including the ability to obtain sufficient
financing; the reliable performance of Zillow Group's network
infrastructure and content delivery processes; Zillow Group's
ability to obtain or maintain licenses and permits to support our
current and future businesses; actual or anticipated changes to our
products and services; the impact of natural disasters and other
catastrophic events; and Zillow Group's ability to protect its
intellectual property. The foregoing list of risks and
uncertainties is illustrative but not exhaustive. For more
information about potential factors that could affect Zillow
Group's business and financial results, please review the "Risk
Factors" described in Zillow Group's Annual Report on Form 10-K for
the year ended December 31, 2019, and
in Zillow Group's Quarterly Report on Form 10-Q for the three
months ended September 30, 2020,
filed with the SEC and in Zillow Group's other filings with the
SEC. Except as may be required by law, Zillow Group does not intend
and undertakes no duty to update this information to reflect future
events or circumstances.
Use of Non-GAAP Financial Measures
To provide investors with additional information regarding our
financial results, this press release includes references to
Adjusted EBITDA in total and for each segment, each a non-GAAP
financial measure. We have provided a reconciliation within this
earnings release of Adjusted EBITDA in total to net income (loss)
and Adjusted EBITDA by segment to income (loss) before income taxes
for each segment, the most directly comparable GAAP financial
measures.
Adjusted EBITDA is a key metric used by our management and board
of directors to measure operating performance and trends and to
prepare and approve our annual budget. In particular, the exclusion
of certain expenses in calculating Adjusted EBITDA facilitates
operating performance comparisons on a period-to-period basis.
Our use of Adjusted EBITDA in total and for each segment has
limitations as an analytical tool, and you should not consider
these measures in isolation or as a substitute for analysis of our
results as reported under GAAP. Some of these limitations are:
- Adjusted EBITDA does not reflect our cash expenditures or
future requirements for capital expenditures or contractual
commitments;
- Adjusted EBITDA does not reflect changes in, or cash
requirements for, our working capital needs;
- Adjusted EBITDA does not consider the potentially dilutive
impact of share-based compensation;
- Although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized may have to be replaced
in the future, and Adjusted EBITDA does not reflect cash capital
expenditure requirements for such replacements or for new capital
expenditure requirements;
- Adjusted EBITDA does not reflect impairment costs;
- Adjusted EBITDA does not reflect the gain (loss) on
extinguishment of the 2021 Notes;
- Adjusted EBITDA does not reflect interest expense or other
income;
- Adjusted EBITDA does not reflect income taxes; and
- Other companies, including companies in our own industry, may
calculate Adjusted EBITDA differently than we do, limiting its
usefulness as a comparative measure.
Because of these limitations, you should consider Adjusted
EBITDA in total and for each segment alongside other financial
performance measures, including various cash flow metrics, net
income (loss), and income (loss) before income taxes for each
segment and our other GAAP results.
About Zillow Group, Inc.
Zillow Group, Inc. (NASDAQ: Z and ZG) is reimagining real estate
to make it easier to unlock life's next chapter.
As the most visited real estate website in the United States, Zillow® and its affiliates
offer customers an on-demand experience for selling, buying,
renting or financing with transparency and nearly seamless
end-to-end service. Zillow Offers® buys and sells homes directly in
dozens of markets across the country, allowing sellers control over
their timeline. Zillow Home Loans™, our affiliate lender, provides
our customers with an easy option to get pre-approved and secure
financing for their next home purchase. Zillow recently
launched Zillow Homes, Inc., a licensed brokerage entity, to
streamline Zillow Offers transactions.
Zillow Group's affiliates and subsidiaries include Zillow®,
Zillow Offers®, Zillow Premier Agent®, Zillow Home Loans™, Zillow
Closing Services™, Zillow Homes, Inc., Trulia®, Out East®,
StreetEasy® and HotPads®. Zillow Home Loans, LLC is an Equal
Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org).
Please visit http://investors.zillowgroup.com,
www.zillowgroup.com/ir-blog, and www.twitter.com/zillowgroup, where
Zillow Group discloses information about the company, its financial
information, and its business that may be deemed material.
The Zillow Group logo is available at
http://zillowgroup.mediaroom.com/logos-photos.
(ZFIN)
Adjusted EBITDA
The following tables present a reconciliation of Adjusted EBITDA
to the most directly comparable GAAP financial measure, which is
net income (loss) on a consolidated basis and income (loss) before
income taxes for each segment, for each of the periods presented
(in thousands, unaudited):
|
Three Months
Ended
December 31, 2020
|
|
Homes
|
|
IMT
|
|
Mortgages
|
|
Corporate
Items (2)
|
|
Consolidated
|
Reconciliation of
Adjusted EBITDA to Net Income and Income (Loss) Before Income
Taxes:
|
|
|
|
|
|
|
|
|
|
Net income
(1)
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
$
46,036
|
Income tax
expense
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
601
|
Income (loss) before
income taxes
|
$
(66,621)
|
|
$
145,369
|
|
$
7,305
|
|
$
(39,416)
|
|
$
46,637
|
Other
income
|
-
|
|
-
|
|
(1,146)
|
|
(1,657)
|
|
(2,803)
|
Depreciation and
amortization expense
|
4,114
|
|
21,973
|
|
1,967
|
|
-
|
|
28,054
|
Share-based
compensation expense
|
12,319
|
|
35,751
|
|
4,375
|
|
-
|
|
52,445
|
Loss on
extinguishment of 2021 Notes
|
-
|
|
-
|
|
-
|
|
4,943
|
|
4,943
|
Interest
expense
|
3,298
|
|
-
|
|
1,147
|
|
36,130
|
|
40,575
|
Adjusted
EBITDA
|
$
(46,890)
|
|
$
203,093
|
|
$
13,648
|
|
$
-
|
|
$
169,851
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
December 31, 2019
|
|
Homes
|
|
IMT
|
|
Mortgages
|
|
Corporate
Items (2)
|
|
Consolidated
|
Reconciliation of
Adjusted EBITDA to Net Loss and Income (Loss) Before Income
Taxes:
|
|
|
|
|
|
|
|
|
|
Net loss
(1)
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
$
(101,210)
|
Income tax
benefit
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
(458)
|
Income (loss) before
income taxes
|
$
(107,923)
|
|
$
36,221
|
|
$
(12,654)
|
|
$
(17,312)
|
|
$
(101,668)
|
Other
income
|
-
|
|
-
|
|
(350)
|
|
(11,683)
|
|
(12,033)
|
Depreciation and
amortization expense
|
3,030
|
|
19,105
|
|
1,444
|
|
-
|
|
23,579
|
Share-based
compensation expense
|
11,724
|
|
32,333
|
|
2,961
|
|
-
|
|
47,018
|
Interest
expense
|
10,644
|
|
-
|
|
288
|
|
28,995
|
|
39,927
|
Adjusted
EBITDA
|
$
(82,525)
|
|
$
87,659
|
|
$
(8,311)
|
|
$
-
|
|
$
(3,177)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
December 31, 2020
|
|
Homes
|
|
IMT
|
|
Mortgages
|
|
Corporate
Items (2)
|
|
Consolidated
|
Reconciliation of
Adjusted EBITDA to Net Loss and Income (Loss) Before Income
Taxes:
|
|
|
|
|
|
|
|
|
|
Net loss
(1)
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
$
(162,115)
|
Income tax
benefit
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
(7,523)
|
Income (loss) before
income taxes
|
$
(320,254)
|
|
$
262,984
|
|
$
4,514
|
|
$
(116,882)
|
|
$
(169,638)
|
Other
income
|
-
|
|
(5,300)
|
|
(2,369)
|
|
(17,860)
|
|
(25,529)
|
Depreciation and
amortization expense
|
13,315
|
|
89,862
|
|
6,854
|
|
-
|
|
110,031
|
Share-based
compensation expense
|
48,166
|
|
134,691
|
|
14,693
|
|
-
|
|
197,550
|
Gain on
extinguishment of 2021 Notes
|
-
|
|
-
|
|
-
|
|
(1,448)
|
|
(1,448)
|
Impairment
costs
|
-
|
|
73,900
|
|
2,900
|
|
-
|
|
76,800
|
Interest
expense
|
16,804
|
|
-
|
|
2,233
|
|
136,190
|
|
155,227
|
Adjusted
EBITDA
|
$
(241,969)
|
|
$
556,137
|
|
$
28,825
|
|
$
-
|
|
$
342,993
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
December 31, 2019
|
|
Homes
|
|
IMT
|
|
Mortgages
|
|
Corporate
Items (2)
|
|
Consolidated
|
Reconciliation of
Adjusted EBITDA to Net Loss and Income (Loss) Before Income
Taxes:
|
|
|
|
|
|
|
|
|
|
Net loss
(1)
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
$
(305,361)
|
Income tax
benefit
|
N/A
|
|
N/A
|
|
N/A
|
|
N/A
|
|
(4,258)
|
Income (loss) before
income taxes
|
$
(312,120)
|
|
$
80,060
|
|
$
(44,962)
|
|
$
(32,597)
|
|
$
(309,619)
|
Other
income
|
-
|
|
-
|
|
(1,409)
|
|
(38,249)
|
|
(39,658)
|
Depreciation and
amortization expense
|
8,414
|
|
73,369
|
|
5,684
|
|
-
|
|
87,467
|
Share-based
compensation expense
|
32,390
|
|
150,434
|
|
16,078
|
|
-
|
|
198,902
|
Interest
expense
|
29,990
|
|
-
|
|
956
|
|
70,846
|
|
101,792
|
Adjusted
EBITDA
|
$
(241,326)
|
|
$
303,863
|
|
$
(23,653)
|
|
$
-
|
|
$
38,884
|
|
(1) We use income
(loss) before income taxes as our profitability measure in making
operating decisions and assessing the performance of our segments,
therefore, net income (loss) and income tax benefit (expense) are
calculated and presented only on a consolidated basis within our
financial statements.
|
(2) Certain corporate
items are not directly attributable to any of our segments,
including the gain (loss) on extinguishment of the 2021 Notes,
interest income earned on our short-term investments included in
other income and interest costs on our convertible senior notes
included in interest expense.
|
View original content to download
multimedia:http://www.prnewswire.com/news-releases/zillow-group-reports-fourth-quarter-and-full-year-2020-financial-results-301226249.html
SOURCE Zillow Group