Zillow Group (NASDAQ: Z) posts $708M Q1 revenue and higher profit
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Zillow Group reported strong first-quarter 2026 results with revenue of $708 million, up 18% year over year. For Sale revenue grew 12% to $514 million, including $450 million of Residential revenue, up 8%, and $64 million of Mortgages revenue, up 56% driven by purchase loan originations rising 96% to $1.5 billion.
Rentals revenue increased 42% to $183 million, primarily from 57% growth in multifamily revenue. Net income was $46 million with a 6% margin, up from $8 million a year earlier, and diluted EPS rose to $0.19 from $0.03. Adjusted EBITDA was $182 million with a 26% margin, flat year over year.
Net cash provided by operating activities reached $200 million, a 92% increase, and Adjusted free cash flow was $127 million, up 44%. Cash and investments were $788 million after repurchasing 13.5 million shares for $626 million. Average monthly unique users were 220 million, down 3% year over year, while Comscore-reported unique visitors to Zillow’s apps and sites rose 12% to 127 million.
Positive
- Revenue and earnings acceleration: Q1 2026 revenue rose 18% year over year to $708 million while net income increased to $46 million and diluted EPS to $0.19 from $0.03, indicating stronger profitability.
Negative
- None.
Insights
Revenue, profit, cash flow and buybacks all strengthened in Q1 2026.
Zillow grew Q1 2026 revenue to $708M, up 18% year over year, versus a U.S. residential real estate industry that the company cites as growing 2%. Net income rose to $46M and diluted EPS to $0.19, from $0.03 a year earlier. Rentals remained a standout, with revenue up 42% to $183M.
Profitability remained solid: Adjusted EBITDA reached $182M with a 26% margin, unchanged despite incremental legal expenses. Operating cash flow nearly doubled to $200M, and Adjusted free cash flow rose 44% to $127M. Management highlighted strong growth in mortgage originations and multifamily rentals as key drivers.
Zillow ended Q1 with $788M in cash and investments after repurchasing 13.5 million shares for $626M. Guidance calls for Q2 revenue of $750M–$765M and Adjusted EBITDA of $150M–$165M, with expectations for mid-teens full-year revenue growth and Adjusted EBITDA margin expansion in 2026.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Total revenue: $708M
Net income: $46M
Adjusted EBITDA: $182M
+5 more
8 metrics
Total revenue
$708M
Q1 2026, up 18% year over year
Net income
$46M
Q1 2026; margin 6%, up 520 bps year over year
Adjusted EBITDA
$182M
Q1 2026; 26% of revenue
Rentals revenue
$183M
Q1 2026, up 42% year over year
Mortgages revenue
$64M
Q1 2026, up 56% year over year
Operating cash flow
$200M
Net cash provided by operating activities, Q1 2026, up 92% YoY
Share repurchases
$626M
13.5M shares repurchased in Q1 2026
Cash and investments
$788M
End of Q1 2026 balance after buybacks
Key Terms
Adjusted EBITDA, Adjusted free cash flow, multifamily revenue, purchase loan origination volume, +2 more
6 terms
Adjusted EBITDA financial
"Q1 Adjusted EBITDA was $182 million, and Adjusted EBITDA margin was 26%"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
Adjusted free cash flow financial
"We generated $127 million of Adjusted free cash flow in Q1, a 44% increase"
Adjusted free cash flow is the amount of money a company generates from its operations after accounting for essential expenses and investments, like maintaining or upgrading equipment. It shows how much cash is truly available to grow the business, pay debts, or return to shareholders, helping investors see the company's financial health more clearly.
multifamily revenue financial
"Rentals revenue increased 42% year over year to $183 million in Q1, primarily driven by multifamily revenue growing 57%"
purchase loan origination volume financial
"Mortgages revenue increased 56% year over year to $64 million in Q1, primarily due to a 96% increase in purchase loan origination volume to $1.5 billion"
Adjusted EBITDA margin financial
"Adjusted EBITDA margin was 26%, flat year over year despite a 160-basis-point headwind"
Adjusted EBITDA margin shows how much profit a company makes from its core operations, expressed as a percentage of its total revenue, after removing certain one-time or unusual expenses and income. It helps investors understand the company's true earning ability from regular business activities, making it easier to compare performance over time or with other companies. Think of it as measuring the efficiency of a business in turning sales into profits, excluding irregular adjustments.
Earnings Snapshot
Revenue: $708M · Guidance included
Q1 2026
Revenue
$708M
+18% YoY
Net income
$46M
up from $8M YoY
Adjusted EBITDA
$182M
+19% YoY
Rentals revenue
$183M
+42% YoY
For Sale revenue
$514M
+12% YoY
Guidance
For Q2 2026, Zillow expects revenue of $750–$765M and Adjusted EBITDA of $150–$165M, and continues to target mid-teens full-year revenue growth with Adjusted EBITDA margin expansion in 2026.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): May 6, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (I.R.S. Employer Identification No.) | ||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||||||||
(206 ) 470-7000
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | |||||
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. | ||||
Zillow Group, Inc. today issued a press release and a shareholder letter announcing its financial results for the fiscal quarter ended March 31, 2026. The full text of the press release issued in connection with the announcement is furnished as Exhibit 99.1 and the shareholder letter as Exhibit 99.2 to this Current Report on Form 8-K.
The information in this Item 2.02 and Exhibits 99.1 and 99.2 of this Current Report on Form 8-K shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
| Item 9.01 | Financial Statements and Exhibits. | ||||
(d) Exhibits.
| Exhibit Number | Description | |||||||
| 99.1 | Press release dated May 6, 2026 entitled “Zillow Group Reports First-Quarter 2026 Financial Results” issued by Zillow Group, Inc. on May 6, 2026. | |||||||
| 99.2 | Shareholder Letter issued by Zillow Group, Inc. on May 6, 2026. | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Dated: May 6, 2026 | ZILLOW GROUP, INC. | ||||||||||
| By: | /s/ JENNIFER ROCK | ||||||||||
| Name: | Jennifer Rock | ||||||||||
| Title: | Chief Accounting Officer | ||||||||||
Exhibit 99.1
| Contacts: | ||
| Investors | ||
| Brad Berning | ||
| ir@zillowgroup.com | ||
| Media | ||
Gina Cole | ||
| press@zillow.com | ||
Zillow Group Reports First-Quarter 2026 Financial Results
SEATTLE, May 6, 2026 — 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 March 31, 2026.
Complete financial results for the first quarter and outlook for the second quarter and the full year of 2026 can be found in the 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 integrated platform is delivering meaningful value for buyers, sellers, renters and real estate professionals alike,” said Zillow Chief Executive Officer Jeremy Wacksman. “We’re embedding AI throughout the real estate experience in ways that make Zillow increasingly indispensable, and we’re innovating with speed and intention. Zillow’s strong Q1 results reflect the consistency of our execution, the strength of our brand, our audience engagement, and the durability of our multi-year strategy.”
Recent highlights include:
•Zillow Group reported strong first-quarter results.
•Q1 revenue was up 18% year over year to $708 million, near the high end of the company’s outlook range. The residential real estate industry grew by 2% in Q1, according to NAR.1 The company estimates Q1 purchase mortgage origination volume for the industry declined approximately 1% year over year.
◦For Sale revenue was up 12% year over year to $514 million in Q1.
▪Residential revenue was up 8% year over year in Q1 to $450 million, benefiting from growth across Preferred, Zillow Showcase, the company’s suite of agent software tools and the company’s New Construction marketplace.
▪Mortgages revenue increased 56% year over year to $64 million in Q1, primarily due to a 96% increase in purchase loan origination volume to $1.5 billion.
◦Rentals revenue increased 42% year over year to $183 million in Q1, primarily driven by multifamily revenue growing 57% year over year.
•Net income was $46 million in Q1, and net income margin was 6%, a 520-basis-point increase year over year. Diluted net income per share was $0.19 compared to $0.03 in Q1 a year ago.
•Q1 Adjusted EBITDA was $182 million, and Adjusted EBITDA margin was 26%, flat year over year despite a 160-basis-point headwind from incremental legal expenses.2 Excluding $11 million of incremental year over year legal expenses, Adjusted EBITDA would have been $193 million in Q1, representing a 27% margin.
•Cash and investments3 at the end of Q1 were $788 million, down from $1.3 billion at the end of 2025. During Q1, the company repurchased 13.5 million shares for $626 million.
1 National Association of Realtors® existing homes sold during Q1 2026 multiplied by the average selling price per home for Q1 2026 compared with the same period in 2025
2 Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures; they are not calculated or presented in accordance with U.S. generally accepted accounting principles (“GAAP”). Please see the “Use of Non-GAAP Financial Measures” section below for more information about our presentation of these non-GAAP financial measures, including a reconciliation to the most directly comparable GAAP financial measures for the relevant period.
3 Cash and investments includes Cash and cash equivalents, Restricted cash and Short-term investments.
•Traffic to Zillow Group’s mobile apps and sites in Q1 was down 3% year over year to 220 million average monthly unique users.4 Visits during Q1 were down 3% year over year to 2.3 billion. According to Comscore, which tracks growth trends across the category, average monthly unique visitors to Zillow Group’s mobile apps and sites in Q1 were up 12% year over year to 127 million, and Zillow is the only large company in its category to increase the amount of the real estate audience it reached over the past six quarters.
4 The company counts a unique user the first time an individual accesses one of the company’s mobile apps using a mobile device during a calendar month and the first time an individual accesses one of the company’s websites using a web browser during a calendar month. If an individual accesses the company’s mobile apps using different mobile devices within a given month, the first instance of access by each such mobile device is counted as a separate unique user. If an individual accesses the company’s websites using different web browsers within a given month, the first access by each such web browser is counted as a separate unique user.
First-Quarter 2026 Financial Highlights
The following table sets forth Zillow Group’s financial highlights for the periods presented (in millions, except percentages, unaudited):
Three Months Ended March 31, | 2025 to 2026 % Change | ||||||||||||||||
| 2026 | 2025 | ||||||||||||||||
| Revenue: | |||||||||||||||||
| For Sale revenue: | |||||||||||||||||
| Residential | $ | 450 | $ | 417 | 8% | ||||||||||||
| Mortgages | 64 | 41 | 56% | ||||||||||||||
| Total For Sale revenue | 514 | 458 | 12% | ||||||||||||||
| Rentals | 183 | 129 | 42% | ||||||||||||||
| Other | 11 | 11 | —% | ||||||||||||||
| Total revenue | $ | 708 | $ | 598 | 18% | ||||||||||||
| Other Financial Data: | |||||||||||||||||
| Gross profit | $ | 519 | $ | 459 | |||||||||||||
Net income | $ | 46 | $ | 8 | |||||||||||||
Diluted net income per share | $ | 0.19 | $ | 0.03 | |||||||||||||
| Net cash provided by operating activities | $ | 200 | $ | 104 | |||||||||||||
Non-GAAP Financial Measures:(1) | |||||||||||||||||
| Adjusted EBITDA | $ | 182 | $ | 153 | |||||||||||||
| Adjusted net income | $ | 129 | $ | 105 | |||||||||||||
| Diluted adjusted net income per share | $ | 0.53 | $ | 0.41 | |||||||||||||
| Adjusted free cash flow | $ | 127 | $ | 88 | |||||||||||||
| Percentage of Revenue: | |||||||||||||||||
| Gross profit | 73% | 77% | |||||||||||||||
Net income | 6% | 1% | |||||||||||||||
Adjusted EBITDA(1) | 26% | 26% | |||||||||||||||
Adjusted net income(1) | 18% | 18% | |||||||||||||||
(1) These are non-GAAP financial measures. Please see the “Use of Non-GAAP Financial Measures” section below for more information about our presentation of these non-GAAP financial measures, including a reconciliation to the most directly comparable GAAP financial measures for the relevant period. | |||||||||||||||||
Conference Call and Webcast Information
Zillow Group will host a live webcast to discuss these results today at 2 p.m. Pacific time (5 p.m. Eastern time). Please register for the live event at https://zillow-q1-26-financial-results.open-exchange.net/. A shareholder letter and link to both the live webcast and recorded replay of the call may be accessed in the Quarterly Results section of Zillow Group’s Investor Relations website.
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 company’s business strategies, the execution of those strategies, and their impact on consumers and real estate professionals. Statements containing words such as “may,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “project,” “predict,” “will,” “projections,” “continue,” “estimate,” “outlook,” “guidance,” “would,” “could,” “strive” or similar expressions constitute forward-looking statements. Forward-looking statements are made based on assumptions as of May 6, 2026, 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 health and stability of the economy and United States residential real estate industry, including changes in inflationary conditions, interest rates, housing availability and affordability, labor shortages and supply chain issues; our ability to manage advertising, product inventory and pricing, and to maintain relationships with our real estate partners; our ability to establish or maintain relationships with listing and data providers, which affects traffic to our mobile apps and websites; or changes to our rights to use or timely access listing data, or to the quality or quantity of such listing data; our ability to comply with current and future rules and requirements promulgated by National Association of REALTORS®, multiple listing services, or other real estate industry groups or governing bodies, or decisions to repeal, amend or not enforce such rules and requirements; our ability to navigate industry changes, including as a result of past, pending or future lawsuits, settlements or government investigations, which may include lawsuits, settlements or investigations in which we are not a named party; uncertainties related to policy changes, enforcement priorities, or government shutdowns at the federal and state levels; our ability to continue to innovate and compete to attract customers and real estate partners; our ability to effectively invest resources to pursue new strategies, develop new products and services and expand existing products and services into new markets; our ability to operate and grow Zillow Home Loans’ mortgage operations, including the ability to obtain or maintain sufficient financing to fund the origination of mortgages, meet customers’ financing needs with product offerings, continue to grow origination operations and resell originated mortgages on the secondary market; the duration and impact of natural disasters, climate change, geopolitical events, and other catastrophic events (including public health crises) on our ability to operate, demand for our products or services, or general economic conditions; our public statements, disclosures, targets, and product features related to sustainability matters; our ability to maintain adequate security controls or technology systems, or those of third parties on which we rely, to protect data integrity and the information and privacy of our customers and other third parties; our ability to navigate any significant disruption in service on our mobile apps or websites or in our network; the impact of past, pending or future litigation and other disputes or enforcement actions, which may include lawsuits or investigations to which we are not a party; our ability to attract, engage, and retain a highly skilled workforce; mergers, acquisitions, investments, strategic partnerships, capital-raising activities, or other corporate transactions or commitments by us or our competitors; our ability to continue relying on third-party services to support critical functions of our business; our ability to protect and continue using our intellectual property and prevent others from copying, infringing upon, or developing similar intellectual property, including as a result of artificial intelligence; our ability to comply with domestic and international laws, regulations, rules, contractual obligations, policies and other obligations, or to obtain or maintain required licenses to support our business and operations; our ability to pay our debt or to raise additional capital or refinance our indebtedness on acceptable terms, or at all; actual or anticipated fluctuations in quarterly and annual results of operations and financial position; actual or perceived inaccuracies in the assumptions, estimates and internal or third-party data that we use to calculate business, performance and operating metrics; and volatility of our Class A common stock and Class C capital stock prices.
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 publicly available filings with the United States Securities and Exchange Commission. 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.
About Zillow Group, Inc.
Zillow Group, Inc. (Nasdaq: Z and ZG) is reimagining real estate to make home a reality for more and more people.
As the most visited real estate app and website in the United States, Zillow connects hundreds of millions of consumers with innovative technology, trusted agents and loan officers, and seamless digital solutions. With industry-leading tools and resources, Zillow supercharges real estate professionals so they can grow their businesses and deliver exceptional client experiences. For renters and housing providers, Zillow offers not only a robust marketplace but a set of end-to-end products and services to streamline applications, leases, payments and more.
Zillow’s ecosystem spans the entire home journey — from dreaming and shopping to renting, buying, selling and financing.
Zillow Group’s affiliates, subsidiaries, and brands include Zillow®, Zillow Premier Agent®, Zillow Home Loans®, Zillow Rentals®, Zillow® New Construction, Trulia®, StreetEasy®, Out East®, HotPads®, Follow Up Boss®, ShowingTime®, dotloop® and Zillow® Closing.
All marks herein are owned by MFTB Holdco, Inc., a Zillow affiliate. Zillow Home Loans, LLC is an Equal Housing Lender, NMLS #10287 (www.nmlsconsumeraccess.org). © 2026 MFTB Holdco, Inc., a Zillow affiliate.
Please visit https://investors.zillowgroup.com, www.zillow.com/news, www.x.com/zillowgroup, and www.linkedin.com/company/zillow, where Zillow Group discloses information about the company, its financial information, and its business that may be deemed material.
Logos for Zillow Group and some of its key brands are available at https://zillow.com/news/logos/.
(ZFIN)
Use of Non-GAAP Financial Measures
To provide investors with additional information regarding our financial results and liquidity, this press release includes references to Adjusted EBITDA, Adjusted net income, Diluted adjusted net income per share, and Adjusted free cash flow, all of which are non-GAAP financial measures not calculated or presented in accordance with GAAP. We have provided a reconciliation below of each non-GAAP financial measure to the most directly comparable GAAP financial measure.
Adjusted EBITDA
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, we believe the exclusion of certain expenses in calculating Adjusted EBITDA facilitates operating performance comparisons on a period-to-period basis.
Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider this measure 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 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 expenditures or contractual commitments;
•Adjusted EBITDA does not reflect interest expense or other income, net;
•Adjusted EBITDA does not reflect income taxes; and
•Other companies, including companies in our own industry, may calculate Adjusted EBITDA differently from the way we do, limiting its usefulness as a comparative measure.
Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including various cash-flow metrics, net income, and our other GAAP results.
Adjusted Net Income and Diluted Adjusted Net Income Per Share
Our presentation of Adjusted net income and Diluted adjusted net income per share excludes the impact of share-based compensation and income taxes. These measures are not key metrics used by our management or Board of Directors to measure operating performance or otherwise manage the business. However, we provide Adjusted net income and Diluted adjusted net income per share as supplemental information to investors, as we believe the exclusion of the results of share-based compensation and income taxes facilitates investors’ operating performance comparisons on a period-to-period basis. You should not consider Adjusted net income and Diluted adjusted net income per share in isolation or as substitutes for analysis of our results as reported under GAAP.
Adjusted Free Cash Flow
We define Adjusted free cash flow as net cash provided by operating activities adjusted for purchases of property and equipment, purchases of intangible assets, net borrowings (repayments) on master repurchase agreements, and the initial payment in connection with the Redfin rentals partnership. Borrowings (repayments) on master repurchase agreements are used to fund Zillow Home Loans mortgage loan originations, and we consider them part of our ongoing liquidity management. The initial payment in connection with the Redfin rentals partnership was considered a one-time and nonrecurring cash flow, and we exclude it from our calculation as we believe it impacts the ability to evaluate the liquidity of our business operations on a period-to-period basis.
We have included Adjusted free cash flow in this press release as it is a key metric used by our management to evaluate the effectiveness of our business strategies and execution and our ability to consistently generate cash from our core operations on a period-to-period basis.
Our use of Adjusted free cash flow has limitations as an analytical tool, and you should not consider this measure in isolation or as a substitute for analysis of our results as reported under GAAP. Adjusted free cash flow does not represent the residual cash flow available for discretionary expenditures. Other companies, including companies in our own industry, may calculate Adjusted free cash flow differently from the way we do, limiting its usefulness as a comparative measure.
Reconciliations of Non-GAAP Financial Measures
The following table presents a reconciliation of Adjusted EBITDA to net income for each of the periods presented (in millions, unaudited):
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
Net income | $ | 46 | $ | 8 | |||||||
| Income taxes | 2 | — | |||||||||
Other income, net | (16) | (22) | |||||||||
| Depreciation and amortization | 65 | 65 | |||||||||
| Share-based compensation | 81 | 97 | |||||||||
| Interest expense | 4 | 5 | |||||||||
| Adjusted EBITDA | $ | 182 | $ | 153 | |||||||
The following table presents a reconciliation of Adjusted net income to net income and associated per-share metrics for each of the periods presented (in millions, except per-share data, unaudited):
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
Net income | $ | 46 | $ | 8 | |||||||
| Share-based compensation | 81 | 97 | |||||||||
| Income taxes | 2 | — | |||||||||
| Adjusted net income | $ | 129 | $ | 105 | |||||||
Diluted net income per share | $ | 0.19 | $ | 0.03 | |||||||
| Diluted adjusted net income per share | $ | 0.53 | $ | 0.41 | |||||||
The following table provides a reconciliation of Adjusted free cash flow to net cash provided by operating activities for the periods presented (in millions, unaudited):
| Three Months Ended March 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net cash provided by operating activities | $ | 200 | $ | 104 | |||||||
| Purchases of property and equipment | (34) | (36) | |||||||||
| Purchases of intangible assets | (10) | (108) | |||||||||
Net borrowings (repayments) on master repurchase agreements | (29) | 28 | |||||||||
| Initial payment in connection with Redfin rentals partnership | — | 100 | |||||||||
| Adjusted free cash flow | $ | 127 | $ | 88 | |||||||
May 6, 2026 Dear Shareholders, Q1 was another quarter of consistent execution and continued momentum across our business. We delivered total revenue of $708 million, up 18% year over year and near the high end of our outlook range. We once again outperformed the broader housing market, which stayed essentially flat. We also delivered $46 million of net income and Adjusted EBITDA1 of $182 million, above our outlook, driven by lower costs than planned. Net cash provided by operating activities was $200 million in Q1, a 92% increase compared with the same period a year ago. We generated $127 million of Adjusted free cash flow2 in Q1, a 44% increase compared with the same period a year ago. And, purchase loan origination volume growth accelerated to 96% year over year to $1.5 billion. These results put us on track toward achieving our full-year goals. In For Sale, revenue grew 12% year over year in Q1 to $514 million, with 8% growth in Residential revenue and 56% growth in Mortgages revenue. In Rentals, Q1 revenue was up 42% year over year, driven by 57% growth in multifamily revenue.3 We are gaining wallet share for broad-based marketing spend with multifamily property managers as they continue to see the strong ROI we are providing to their businesses. Our strategy is straightforward: make moving easier by connecting the entire housing journey into one integrated end-to-end experience supporting renters, buyers, sellers and the professionals who serve them. ZILLOW’S STRATEGY IS ACCELERATED BY AI We have been building advanced technology in residential real estate for 20 years, from the Zestimate to the mobile revolution to computer vision and beyond. As we discussed at our AI Investor Summit,4 we 4https://zillow2026investorday.q4ir.com/home/default.aspx 3Zillow Rentals defines “multifamily” properties as those with 25 or more units. 2Adjusted free cash flow is a non-GAAP financial measure; it is not calculated or presented in accordance with GAAP. Please see the “Use of Non-GAAP Financial Measures” section below for more information about our presentation and calculation of Adjusted free cash flow, including a reconciliation to the most directly comparable GAAP financial measure for the relevant periods. 1Adjusted EBITDA is a non-GAAP financial measure; it is not calculated or presented in accordance with GAAP. Please see the “Use of Non-GAAP Financial Measures” section below for more information about our presentation of Adjusted EBITDA, including a reconciliation to the most directly comparable GAAP financial measure for the relevant period. 1 | Q1 2026
believe Zillow is uniquely positioned to lead real estate in this next chapter as well, thanks to three advantages: content, context, and integration. These factors are difficult to replicate and differentiate us from horizontal LLMs and from other real estate companies. First, content: Our comprehensive and increasingly differentiated housing inventory is elevated by proprietary rich media — Zillow 3D HomeⓇ tours, interactive floor plans, virtual staging and SkyTour. More than 10% of new for-sale listings on Zillow today include Zillow 3D Home tours and interactive floor plans, and we expect rich media to become the standard buyers and sellers demand. That growing coverage improves the consumer experience today and makes our AI more capable over time. Our second advantage is context. Seventy percent of everyone who buys or sells a home in America uses Zillow during the process5 — spending an average of two to three hours a week over five months, saving homes, booking tours, messaging agents and preparing offers.6 That is sustained, deep intent that Zillow uniquely understands, and it is the context that compounds for our AI platform. Having a full vantage allows us to do more than answer generic listing questions — we can anticipate what a consumer needs to do next and help them take that action. This leads to our third advantage: integration. For consumers, we connect marketing, search, renting, touring, financing and closing into a single, coherent experience interwoven with professional workflows. Zillow operates at the core of the transaction, not around the edges of it. We handle the complexity, understand the full picture, and help consumers and professionals take action. These three advantages are built on something that matters just as much as the technology itself: two decades of operating in one of the most regulated and complex transaction categories. Structural complexity in housing shapes what AI can do and what it takes to do it well. Transactions are high-dollar, high-stakes, highly personal, and for most people, they happen only a handful of times over their entire lifetime. There are hundreds of thousands of brokers working across several hundred MLSs, powering 1.5 million agents. We’ve spent 20 years navigating this landscape, putting in place the industry relationships 6Zillow internal data and estimates, 2025. 5Comscore data for Q1 2026, calculated as average monthly unique visitors to Zillow Group mobile apps and sites divided by "real estate" unique visitors (as defined by Comscore). 2 | Q1 2026
and infrastructure to provide products and services directly for the transaction — not just observe it from the outside. Our long history of innovation and investment enable us to deliver value that only increases as AI capabilities grow. Zillow’s new consumer-facing AI mode experience is live for about 5% of our audience — available to millions of users — with broader access planned as we test, learn and refine the experience. Early signals are encouraging: Zillow users in AI mode are having deeper, more substantive conversations than they do in traditional search — and we are seeing more actionable engagement as a result. We are also embedding AI throughout the agent and loan officer experience. Follow Up Boss, which top agents in the country rely on to manage their businesses, is becoming an AI-powered workflow engine that handles coordination, prioritization and outreach so agents can stay focused on the judgment, advocacy, trust and human relationships that get deals done. The result is that great agents become, in effect, “super agents” who can take on more transactions, at higher quality, without more hours — all enabled by Zillow. Just as AI is making our two-sided marketplace work smarter for both consumers and agents in For Sale, the same is true in Rentals. For renters, it’s powering more personalized search and helping surface the right next step, and for property managers using AI Assist - Zillow’s embedded AI leasing assistant for multifamily listings, it’s streamlining lead management, applicant screening and lease coordination. Our commitment to AI-fueled efficiency doesn’t stop at our consumer and professional products — it runs all the way through how Zillow itself operates. Our engineers are shipping, on average, 40% more code per engineer,7 teams are prototyping and taking features from concept to launch faster, and employees are using AI to reinvent workflows. Productivity gains go directly back into building more, faster — so we believe the benefits of becoming an AI-native company will compound over time. 7Zillow internal data and estimates, 2025. 3 | Q1 2026
FOR SALE Our thesis is straightforward: integration improves outcomes. We believe when marketing, search, touring, financing and agent collaboration work together, every participant in the transaction gets a better result. For buyers, the integrated experience begins the moment they start shopping. BuyAbilitySM,8 a tool from Zillow Home Loans9 that helps buyers understand what they can afford, has enrolled 4.3 million users as of the end of Q1, up from 3.6 million at the end of 2025. Purchase loan origination volume grew by 96% year over year to a record $1.5 billion in Q1, and Zillow Home Loans is now a top 25 purchase lender in the country.10 Zillow Home Loans averages double-digit adoption across our Enhanced Markets, where the integrated transaction experience is most fully realized. Enhanced Markets accounted for 49% of our connections in Q1, up from 44% in Q4 and well on our way to our intermediate target of at least 75%. Our new Shop with Pre-Approval feature11, which is now available across our platform, gives buyers with a Zillow Home Loans pre-approval a clearer view of monthly costs and whether a listing is within budget. It makes shopping more actionable, signals to us and agents that a buyer is higher-intent, and is one of the clearest expressions yet of what our integrated platform can do to help a buyer shop with confidence. Shop with Pre-Approval is unique to Zillow, and it works in concert with My Agent — the tool that lets buyers designate the agent they’re working with (regardless of whether they’re a Zillow Preferred agent) and shop alongside them — making a buyer’s whole team present and accessible as they use Zillow. Messaging on the Zillow app then threads it all together by letting a buyer, agent and loan officer communicate in one place. We’re also bringing co-shoppers into the cohesive, integrated experience, because a significant portion of buyers aren’t going it alone. On Zillow, buyers can search and collaborate with a 11https://www.youtube.com/watch?v=YcYc3viG3iY 10Zillow internal data and estimates, Q1 2026. 9https://www.zillow.com/homeloans/ 8https://www.zillow.com/homeloans/buyability/ 4 | Q1 2026
co-shopper in real time. This capability became available earlier this year and is already driving better buyer engagement because it brings a naturally collaborative part of the homebuying journey into Zillow’s integrated ecosystem where those discussions can be acted on. For sellers, we continue to expand our suite of products designed to provide differentiated ways to market homes and achieve stronger results. Zillow Preview12 gives pre-market listings broad public exposure on the most visited real estate platform in America. Unlike pre-marketing in a private listing network, Preview puts listings in front of the buying public from day one. With Preview, sellers get real-time signals — views, saves, tour scheduling requests — from Zillow’s large, deeply engaged audience, which is pricing intelligence they can actually use. And Preview listings surface right in a buyer’s regular Zillow search and recommendations, no insider access required. Yesterday, we announced a new Zillow Preview collaboration with Realtor.comⓇ,13 extending the visibility of pre-market inventory across the two most visited real estate platforms in the country. This wide exposure benefits sellers, buyers and agents with unrestricted access to the inventory in more places. New Harris Poll survey data backs up why this matters: nearly 9 in 10 Americans would be interested in viewing pre-listed homes online if they were buying a home, and 85% of soon-to-be sellers said they’d be more likely to hire an agent who can pre-market their home to the broadest online audience.14 We announced Preview just seven weeks ago with five initial brokerage partners, and we have since added more than 60 brokerages. We are currently onboarding agents to use Preview and are excited about the significant agent demand we are seeing as we launch and scale the product. 14Harris Poll survey conducted April 2026. 13https://investors.zillowgroup.com/investors/news-and-events/news/news-details/2026/Zillow-and -Realtor-com-set-a-new-standard-for-pre-market-transparency-extending-Preview-listings-to-b uyers-across-both-platforms/default.aspx 12https://www.zillow.com/agents/preview/ 5 | Q1 2026
After Zillow Preview builds initial momentum and the listing goes active, sellers and agents can choose Zillow Showcase15 to maximize impact. Showcase listings — featuring interactive floor plans, 3D tours, virtual staging and SkyTour — drive more engagement, and sell faster and for more money, than non-Showcase listings.16 Zillow Showcase was on 4.3% of new listings in Q1, up from 3.7% in Q4. Agents using Showcase on the majority of their listings win more new listings than peers who don’t, which is why adoption continues to grow — including through recent enterprise-level agreements with some of the country’s largest brokers and franchisors. Together, Preview and Showcase give sellers and their agents a complete marketing toolkit for the listing lifecycle. For professionals, the tools and infrastructure Zillow provides can increasingly function as an operating system for modern real estate. Follow Up Boss17 is used by more than 80% of the highest-volume real estate teams in the country, with monthly active users up more than 70% since Zillow acquired it at the end of 2023.18 ShowingTime19 enables tours on 90% of all homes for sale in the country20 — 40 million tours were booked through the platform last year. And dotloop facilitates closings for nearly half of all transactions nationwide.21 Zillow Pro brings it all together — giving agents a single, connected system to manage all of their clients, including those who originated outside the Zillow ecosystem. Zillow Pro is in beta and already drawing meaningful interest, with more than 12,000 agents using the product so far. It’s on track for a broader nationwide rollout in the second half of this year. All of our For Sale solutions point to the same conclusion: The more integrated the experience, the better the outcome for all parties. The momentum we’re building gives us conviction as we execute against our $1 billion incremental mid-cycle revenue target in For Sale.22 22Please see slide 25 of our February 2026 Investor Deck for more information about this revenue target. 21Zillow internal data and estimates, 2025. 20Zillow internal data and estimates, 2025. 19https://showingtime.com/ 18Zillow internal data and estimates, 2026. 17https://www.followupboss.com/ 16https://www.zillow.com/agents/showcase-facts/ 15https://www.zillow.com/agents/showcase/ 6 | Q1 2026
RENTALS In Rentals, we are building something that has not previously existed in the category: a true, comprehensive, two-sided marketplace that brings together the most and the widest variety of listings, high-intent demand and modern transaction tools. Our strategy is twofold: First, we’re building a trusted destination for renters to find every type of property — from single-family homes to large apartment communities. Second, we’re modernizing the rental transaction itself, streamlining how renters and property managers connect and manage applications, leases and payments. We reached an all-time high of 76,000 multifamily properties as of the end of Q1, up from 55,000 properties a year ago. Combining these properties with our industry-leading inventory of longtail rentals, Zillow had 2.7 million average monthly active rental listings in Q1, the most in the category. Zillow Rentals attracted 36 million average monthly unique visitors in Q1,23 a lead we continue to widen, and renters rate Zillow as their #1 preferred platform.24 High-quality audience engagement translates to strong outcomes for our partners. Property managers tell us Zillow delivers the highest return on marketing investment in our category — compared with not just other rental platforms, but other digital marketing options available to them, including search and social.25 That ROI drives growing wallet share as property managers renew and upgrade their presence on Zillow, and we see a significant opportunity to capture more of the marketing dollars currently being spent on other advertising platforms. Multifamily was the engine behind our 42% year-over-year increase in Rentals revenue in Q1. In April, we launched a live analytics dashboard for portfolio performance and benchmarking, alongside a paid social product that places listings on Instagram, Facebook and TikTok — fully managed by Zillow. The two are designed to work together: identify which units need more traffic in the dashboard, then dial up social reach instantly. It’s all 25Zillow internal data and estimates, 2025. 24Zillow internal data and estimates, 2025. 23Average monthly rentals unique visitors for Q1 2026 estimated using Comscore data. 7 | Q1 2026
part of the growing list of ways Zillow’s rental platform is leveling up for partners and making it easier for them to fill units faster. The same principles driving our For Sale strategy apply in Rentals: transparency builds trust, integration drives efficiency, and a better experience on both sides of the marketplace compounds over time. Rentals revenue has grown at an average of 32% annually since 2022, significantly outpacing the broader rental advertising market. With a clear path toward our target of $1 billion or more in annual revenue,26 Rentals is one of our most compelling growth opportunities. IN CLOSING Stepping back and putting this quarter in context: We delivered 18% revenue growth, net income of $46 million, $182 million in Adjusted EBITDA, 92% growth in net cash provided by operating activities, and 44% growth in Adjusted free cash flow, all against a housing market that was essentially flat. Our revenue has consistently outperformed industry total transaction value for more than three years now. Our results reflect the durability of a multi-year strategy designed to perform across market cycles — and a platform that operates across the entire housing transaction. Underpinning all that we do is a strong brand millions of people come to for help making one of the biggest financial decisions of their lives. Roughly 80% of our traffic comes directly to us.27 “Zillow” is searched more often than the term “real estate.”28 We have more than twice the daily active app users of our next closest competitor.29 And according to Comscore, Zillow is the only large company in our category that has increased the amount of the real estate audience we reach over the past six quarters.30 When people are ready to move, Zillow is where they start — and, increasingly, where they stay to take their next steps. 30Comscore data for the six quarters ended March 31, 2026. 29Sensor Tower data as of March 31, 2026. 282025 Google Trends report. 27Zillow internal data and estimates, 2026. 26Please see slide 28 of our February 2026 Investor Deck for more information about this revenue target. 8 | Q1 2026
We are focused on helping more people move with confidence, delivering real value to the professionals who serve them, and creating long-term value for shareholders. We’re on track toward achieving our full-year goals, and we are in control of our own path. We look forward to sharing our continued progress, and appreciate your partnership along the way. Sincerely, Jeremy Wacksman Jeremy Hofmann CEO CFO 9 | Q1 2026
First-Quarter 2026 Highlights Zillow Group reported strong first-quarter results. ● Q1 revenue was up 18% year over year to $708 million, near the high end of our outlook range. The residential real estate industry grew by 2% in Q1, according to the National Association of REALTORS®. We estimate Q1 purchase mortgage origination volume for the industry declined approximately 1% year over year. ○ For Sale revenue was up 12% year over year to $514 million in Q1. ■ Residential revenue was up 8% year over year in Q1 to $450 million, benefiting from growth across Preferred, Zillow Showcase, our suite of agent software tools and our New Construction marketplace. ■ Mortgages revenue increased 56% year over year to $64 million in Q1, primarily due to a 96% increase in purchase loan origination volume to $1.5 billion. ○ Rentals revenue increased 42% year over year to $183 million in Q1, primarily driven by multifamily revenue growing 57% year over year. ● Net income was $46 million in Q1, and net income margin was 6%, a 520-basis-point increase year over year. Diluted net income per share was $0.19 compared to $0.03 in Q1 a year ago. ● Q1 Adjusted EBITDA was $182 million, and Adjusted EBITDA margin31 was 26%, flat year over year despite a 160-basis-point headwind from incremental legal expenses. Excluding $11 million of incremental year over year legal expenses, Adjusted EBITDA would have been $193 million in Q1, representing a 27% margin. ● Cash and investments32 at the end of Q1 were $788 million, down from $1.3 billion at the end of 2025. During Q1, we repurchased 13.5 million shares for $626 million. ● Traffic to Zillow Group’s mobile apps and sites in Q1 was down 3% year over year to 220 million average monthly unique users.33 Visits during Q1 were down 3% year over year to 2.3 billion. According to Comscore, which tracks growth trends across the category, average monthly unique visitors to Zillow Group’s mobile apps and sites in Q1 were up 12% year over year to 127 million, and we are the only large company in our category to increase the amount of the real estate audience we reach over the past six quarters. 33We count a unique user the first time an individual accesses one of our mobile apps using a mobile device during a calendar month and the first time an individual accesses one of our websites using a web browser during a calendar month. If an individual accesses our mobile apps using different mobile devices within a given month, the first instance of access by each such mobile device is counted as a separate unique user. If an individual accesses our websites using different web browsers within a given month, the first access by each such web browser is counted as a separate unique user. 32Cash and investments includes Cash and cash equivalents, Restricted cash and Short-term investments. 31Adjusted EBITDA margin is a non-GAAP financial measure; it is not calculated or presented in accordance with GAAP. Please see the “Use of Non-GAAP Financial Measures” section below for more information about the presentation and calculation of Adjusted EBITDA margin. 10 | Q1 2026
Select Q1 2026 Results FOR SALE For Sale revenue grew 12% year over year to $514 million in Q1. On a trailing 12-month basis, For Sale revenue per TTV at the end of Q1 was 8.7 basis points, compared with 8.0 basis points for the same period in 2025. RESIDENTIAL Residential revenue increased 8% year over year to $450 million in Q1. The majority of the increase in Residential revenue was due to growth in Zillow Preferred, primarily driven by the expansion of connections alongside our Enhanced Markets growth and strong conversion for our Preferred partners. Zillow Showcase, our suite of agent software tools, and New Construction, were also contributors to Residential revenue growth. Market-Based-Pricing revenue continues to decline as we transition the majority of our agent-related activity to our Preferred partners. MORTGAGES Mortgages revenue increased 56% year over year to $64 million in Q1, driven by 96% growth in our purchase loan origination volume to $1.5 billion. Our mortgage strategy is leading more buyers to choose financing through Zillow Home Loans, which is the main growth driver of our overall Mortgages revenue. RENTALS Rentals revenue increased 42% year over year to $183 million in Q1, primarily driven by a 57% increase in multifamily revenue. Zillow Rentals had 36 million average monthly rentals unique visitors in Q1. We continue to grow our multifamily rentals marketplace, with the number of multifamily properties advertising across Zillow reaching 76,000 at the end of Q1 — an increase of 21,000 properties, or 38%, from the end of Q1 2025. 11 | Q1 2026
NET INCOME AND ADJUSTED EBITDA Net income was $46 million in Q1, and net income margin was 6%, a 520-basis-point increase year over year. Diluted net income per share was $0.19 compared to $0.03 in Q1 a year ago. Q1 Adjusted EBITDA was $182 million, and Adjusted EBITDA margin was 26%, flat year over year despite the 160-basis-point headwind from incremental legal expenses. Excluding $11 million of incremental year over year legal expenses, Adjusted EBITDA would have been $193 million in Q1, representing 27% margin. Total Operating Expenses and Cost of Revenue Total operating expenses and cost of revenue totaled $672 million in Q1, up 1% from Q4 2025 and up 11% year over year. Year-over-year results were impacted by higher cost of revenue, which was up $50 million, primarily associated with higher lead acquisition costs, which were within our expectations as part of the rentals syndication agreement with Redfin, and higher mortgage loan processing costs due to increased purchase loan origination volume. The $12 million year-over-year increase in sales and marketing expenses was primarily due to increases in headcount-related expenses supporting increased purchase loan origination volume. General and administrative expenses were up $2 million due to an increase of $11 million in legal expenses, which was partially offset by a $9 million decrease in headcount-related expenses, driven primarily by a decrease in share-based compensation expense. Adjusted EBITDA expenses34 were $526 million in Q1, up 18% year over year and below our Q1 outlook of $535 million to $540 million. 34Adjusted EBITDA expenses is a non-GAAP financial measure; it is not calculated or presented in accordance with GAAP. Please see the “Use of Non-GAAP Financial Measures” section below for more information about our presentation and calculation of Adjusted EBITDA expenses. 12 | Q1 2026
The following table presents a reconciliation of Adjusted EBITDA expenses to total operating expenses and cost of revenue for the periods presented (in millions, except percentages, unaudited): BALANCE SHEET & CASH FLOW SUMMARY Net cash provided by operating activities was $200 million in Q1 2026, a 92% increase compared with the same period a year ago. We generated $127 million of Adjusted free cash flow in Q1 2026, a 44% increase compared with the same period a year ago. We ended Q1 with cash and investments of $788 million, down from $1.3 billion at the end of 2025. During Q1, we repurchased 13.5 million shares for $626 million. We have approximately $1.3 billion remaining on our share repurchase authorizations as of the end of Q1. With our $500 million undrawn revolving credit facility, we have total liquidity of $1.3 billion, which gives us continued flexibility on our financial priorities to invest in growth, maintain an adequate risk-based capital reserve, pursue potential M&A, and remain opportunistic with share buybacks. 13 | Q1 2026
Outlook The following table presents our outlook for the three months ending June 30, 2026 (in millions): 35 ● In Q2, we expect total revenue of $750 million to $765 million. ○ We expect Q2 year-over-year For Sale revenue growth to be similar to Q1. ■ We expect Residential revenue growth of mid-single digits year over year. ■ We expect Mortgages revenue to grow at similar levels to Q1. ○ We expect Rentals year-over-year revenue growth of approximately 30%. ● Q2 Adjusted EBITDA expenses are expected to be $600 million. ● We expect Adjusted EBITDA of $150 million to $165 million. ○ Excluding expected incremental year-over-year legal costs of approximately $20 million in Q2, we expect Adjusted EBITDA would be $170 million to $185 million. ○ We are planning for approximately $80 million of total advertising spend in Q2, up from $64 million last year. The $16 million incremental year-over-year advertising growth in Q2 is due to the timing of planned product launches that were already included in our original full-year outlook. 35Zillow Group has not provided a quantitative reconciliation of forecasted Adjusted EBITDA to forecasted GAAP net income (loss) within this communication because the Company is unable, without making unreasonable efforts, to calculate certain reconciling items with confidence. These items include but are not limited to: income taxes that are directly impacted by unpredictable fluctuations in the market price of the Company’s capital stock, depreciation and amortization from new acquisitions, impairments of assets, and acquisition-related costs. These items, which could materially affect the computation of forward-looking GAAP net income (loss), are inherently uncertain and depend on various factors, many of which are outside of Zillow Group’s control. The Company has not provided a reconciliation of forecasted Adjusted EBITDA expenses to forecasted total operating expenses and cost of revenue, the most directly comparable GAAP financial measure, for the same reasons. For more information regarding the non-GAAP financial measures discussed in this communication, please see the “Use of Non-GAAP Financial Measures” section below. 14 | Q1 2026
2026 OUTLOOK Our Q1 results and our Q2 outlook put us on track to achieve our full year goals. For the full year 2026, we continue to expect: ○ Mid-teens total revenue growth year over year. ■ Rentals year-over-year revenue growth of approximately 30%. ○ Fixed cost base of approximately $1.1 billion to grow with inflation. ○ Variable cost base to grow ahead of revenue in the first half of 2026 and then trend toward being in line with revenue growth by year end. ○ Modest growth in our advertising spend to accelerate consumer awareness of our expanding offerings. ○ Adjusted EBITDA margin expansion year over year. ■ Our structural revenue growth drivers and cost levers are well intact. We expect these structural drivers to result in Adjusted EBITDA growing faster than revenue, and net income growing faster than both revenue and Adjusted EBITDA. ○ Our full-year outlook implies margins will expand meaningfully in the back half of the year. For the second half of 2026 there are four main drivers of our expected margin expansion: ■ First we expect to continue to leverage fixed costs, which is within our control. ■ Second, we expect variable expense growth will decelerate as we move through the year. In the first half of 2026, we expect variable costs to be a headwind of more than 400 basis points to Adjusted EBITDA margins. By year end, we expect that headwind to be close to neutral - a meaningful swing that flows directly to the bottom line. ■ Third, we expect that legal expenses will be an approximately 200 basis point headwind to Adjusted EBITDA margins in the first half of 2026. We expect legal expenses will be less of a headwind to margins in the second half of the year as we get through the FTC trial. ■ Last, our advertising spend is more heavily weighted in Q2 this year than in prior years due to planned product launches. In the back half of the year, we expect advertising to follow a more typical seasonal pattern - meaning less year-over-year pressure on margins than we expect in Q2. ○ We are updating our outlook for share-based compensation expense to be down more than 15% year over year, compared with down more than 10% year over year previously. ○ We are planning for the macro housing environment to continue to bounce along the bottom of the housing cycle. 15 | Q1 2026
Forward-Looking Statements This communication 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 our future targets and opportunities; the future growth, performance and operation of our business; our business strategies and ability to translate such strategies into financial performance; and the health of, and our impact on, the residential real estate industry. Statements containing words such as “may,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “project,” “predict,” “will,” “projections,” “continue,” “estimate,” “outlook,” “opportunity,” “guidance,” “would,” “could,” “strive,” “path,” “positioned,” “on track,” “target,” “goal,” or similar expressions constitute forward-looking statements. Forward-looking statements are made based on assumptions as of May 6, 2026, 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 health and stability of the economy and United States residential real estate industry, including changes in inflationary conditions, interest rates, housing availability and affordability, labor shortages and supply chain issues; our ability to manage advertising, product inventory and pricing, and to maintain relationships with our real estate partners; our ability to establish or maintain relationships with listing and data providers, which affects traffic to our mobile apps and websites; or changes to our rights to use or timely access listing data, or to the quality or quantity of such listing data; our ability to comply with current and future rules and requirements promulgated by National Association of REALTORS®, multiple listing services, or other real estate industry groups or governing bodies, or decisions to repeal, amend or not enforce such rules and requirements; our ability to navigate industry changes, including as a result of past, pending or future lawsuits, settlements or government investigations, which may include lawsuits, settlements or investigations in which we are not a named party; uncertainties related to policy changes, enforcement priorities, or government shutdowns at the federal and state levels; our ability to continue to innovate and compete to attract customers and real estate partners; our ability to effectively invest resources to pursue new strategies, develop new products and services and expand existing products and services into new markets; our ability to operate and grow Zillow Home Loans’ mortgage operations, including the ability to obtain or maintain sufficient financing to fund the origination of mortgages, meet customers’ financing needs with product offerings, continue to grow origination operations and resell originated mortgages on the secondary market; the duration and impact of natural disasters, climate change, geopolitical events, and other catastrophic events (including public health crises) on our ability to operate, demand for our products or services, or general economic conditions; our public statements, disclosures, targets, and product features related to sustainability matters; our ability to maintain adequate security controls or technology systems, or those of third parties on which we rely, to protect data integrity and the information and privacy of our customers and other third parties; our ability to navigate any significant disruption in service on our mobile apps or websites or in our network; the impact of past, pending or future litigation and other disputes or enforcement actions, which may include lawsuits or investigations to which we are not a party; our ability to attract, engage, and retain a highly skilled workforce; mergers, acquisitions, investments, strategic partnerships, capital-raising activities, or other corporate transactions or commitments by us or our competitors; our ability to continue relying on third-party services to support critical functions of our business; our ability to protect and continue using our intellectual property and prevent others from copying, infringing upon, or developing similar intellectual property, including as a result of artificial intelligence; our ability to comply with domestic and international laws, regulations, rules, contractual obligations, policies and other obligations, or to obtain or maintain required licenses to support our business and operations; our ability to pay our debt or to raise additional capital or refinance our indebtedness on acceptable terms, or at all; actual or anticipated fluctuations in quarterly and annual results of operations and financial position; actual or perceived inaccuracies in the assumptions, estimates and internal or third-party data that we use to calculate business, performance and operating metrics; and volatility of our Class A common stock and Class C capital stock prices. 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 16 | Q1 2026
Factors” described in Zillow Group’s publicly available filings with the United States Securities and Exchange Commission (“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. No Incorporation by Reference This communication includes website addresses and references to additional materials found on those websites, including Zillow Group’s websites. These websites and materials are not incorporated by reference herein or in our other filings with the SEC. Use of Estimates and Statistical Data This communication includes estimates and other statistical data made by independent third parties and by Zillow Group relating to the housing market, the mortgage-rate environment, connections, conversion, engagement, growth, rental listings and other data about Zillow Group’s audience and performance and the residential real estate industry and purchase loan origination industry. These data involve a number of assumptions and limitations, which may significantly impair their accuracy, and you are cautioned not to give undue weight to such estimates. Projections, assumptions and estimates of future performance are necessarily subject to a high degree of uncertainty and risk. Use of Non-GAAP Financial Measures To provide investors with additional information regarding our financial results, this communication includes references to Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDA expenses, and Adjusted free cash flow, all of which are non-GAAP financial measures not calculated or presented in accordance with U.S. generally accepted accounting principles (“GAAP”). We have provided a reconciliation below of each non-GAAP financial measure to the most directly comparable GAAP financial measure. Adjusted EBITDA, Adjusted EBITDA margin and Adjusted EBITDA expenses These non-GAAP measures are key metrics used by our management and board of directors to measure operating performance and trends and to prepare and approve our annual budget. In particular, we believe the exclusion of certain expenses in calculating these measures facilitates operating performance comparisons on a period-to-period basis. Our use of these non-GAAP financial measures 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 include, but are not limited to, the fact that such non-GAAP measures: • Do not reflect changes in, or cash requirements for, our working capital needs; • Do 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 these non-GAAP measures do not reflect cash capital expenditure requirements for such replacements or for new capital expenditures or contractual commitments; • Do not reflect impairment costs; • Do not reflect interest expense or other income, net; • Do not reflect income taxes; and • May be calculated differently by other companies, including companies in our own industry, from the way we do, limiting their usefulness as comparative measures. Because of these limitations, you should consider these measures alongside other financial performance measures, including various cash-flow metrics, net income, and our other GAAP results. 17 | Q1 2026
Adjusted Free Cash Flow We define Adjusted free cash flow as net cash provided by operating activities adjusted for purchases of property and equipment, purchases of intangible assets, net borrowings (repayments) on master repurchase agreements, and the initial payment in connection with the Redfin rentals partnership. Borrowings (repayments) on master repurchase agreements are used to fund Zillow Home Loans mortgage loan originations, and we consider them part of our ongoing liquidity management. The initial payment in connection with the Redfin rentals partnership was considered a one-time and nonrecurring cash flow, and we exclude it from our calculation as we believe it impacts the ability to evaluate the liquidity of our business operations on a period-to-period basis. We have included Adjusted free cash flow in this communication as it is a key metric used by our management to evaluate the effectiveness of our business strategies and execution and our ability to consistently generate cash from our core operations on a period-to-period basis. Our use of Adjusted free cash flow has limitations as an analytical tool and you should not consider this measure in isolation or as a substitute for analysis of our results as reported under GAAP. Adjusted free cash flow does not represent the residual cash flow available for discretionary expenditures. Other companies, including companies in our own industry, may calculate Adjusted free cash flow differently from the way we do, limiting its usefulness as a comparative measure. We have provided a reconciliation above of Adjusted EBITDA expenses to total operating expenses and cost of revenue, the most directly comparable GAAP financial measure. The following tables present a reconciliation of Adjusted EBITDA to net income, the most directly comparable GAAP financial measure, and a calculation of Adjusted EBITDA expenses for each of the periods presented (in millions, unaudited): Three Months Ended March 31, 2026 December 31, 2025 September 30, 2025 June 30, 2025 March 31, 2025 Net income $ 46 $ 3 $ 10 $ 2 $ 8 Income taxes 2 — 2 — — Other income, net (16) (19) (18) (18) (22) Depreciation and amortization 65 65 67 67 65 Share-based compensation 81 95 99 99 97 Impairment costs — — 2 — — Interest expense 4 5 3 5 5 Adjusted EBITDA $ 182 $ 149 $ 165 $ 155 $ 153 Three Months Ended March 31, 2026 December 31, 2025 March 31, 2025 Calculation of Adjusted EBITDA Expenses: Revenue $ 708 $ 654 $ 598 Less: Adjusted EBITDA (182) (149) (153) Adjusted EBITDA expenses $ 526 $ 505 $ 445 18 | Q1 2026
The following table presents a reconciliation of Adjusted free cash flow to net cash provided by operating activities for the periods presented (in millions, unaudited): Three Months Ended March 31, 2026 2025 Net cash provided by operating activities $ 200 $ 104 Purchases of property and equipment (34) (36) Purchases of intangible assets (10) (108) Net borrowings (repayments) on master repurchase agreements (29) 28 Initial payment in connection with Redfin rentals partnership — 100 Adjusted free cash flow $ 127 $ 88 The following tables present certain financial data, non-GAAP measures and associated year-over-year percentage changes for each of the periods presented (in millions, except percentages and margin basis points, unaudited): Three Months Ended March 31, 2025 to 2026 % Change2026 2025 Revenue: For Sale revenue: Residential $ 450 $ 417 8% Mortgages 64 41 56% Total For Sale revenue 514 458 12% Rentals 183 129 42% Other 11 11 —% Total revenue $ 708 $ 598 18% Other Financial Data: Gross profit $ 519 $ 459 13% Net income $ 46 $ 8 475% Net cash provided by operating activities $ 200 $ 104 92% Non-GAAP Financial Measures: Adjusted EBITDA $ 182 $ 153 19% Adjusted free cash flow $ 127 $ 88 44% Three Months Ended March 31, 2025 to 2026 % Change 2025 to 2026 Margin Change Basis Points Percentage of Revenue: 2026 2025 Gross profit 73.3 % 76.8 % (4.6)% (350) Net income 6.5 % 1.3 % 400.0% 520 Adjusted EBITDA 25.7 % 25.6 % 0.4% 10 19 | Q1 2026
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FAQ
How did Zillow Group (Z) perform financially in Q1 2026?
Zillow Group reported Q1 2026 revenue of $708 million, up 18% year over year, with net income of $46 million. Adjusted EBITDA reached $182 million with a 26% margin, and Adjusted free cash flow was $127 million, reflecting stronger profitability and cash generation.
What drove Zillow Group’s revenue growth in Q1 2026?
Revenue growth came from both For Sale and Rentals. For Sale revenue increased 12% to $514 million, including 56% growth in Mortgages to $64 million. Rentals revenue rose 42% to $183 million, mainly from a 57% increase in multifamily revenue and expanding rental inventory.
How did Zillow Group’s mortgage business perform in Q1 2026?
Zillow’s Mortgages revenue increased 56% year over year to $64 million, primarily from purchase loan origination volume rising 96% to $1.5 billion. Management noted that more buyers are choosing financing through Zillow Home Loans, supporting overall segment growth.
What were Zillow Group’s Q1 2026 cash flow and liquidity figures?
Net cash provided by operating activities was $200 million in Q1 2026, up 92% from a year earlier. Adjusted free cash flow reached $127 million, a 44% increase. Zillow ended the quarter with $788 million in cash and investments, plus an undrawn $500 million revolving credit facility.
How much stock did Zillow Group repurchase in Q1 2026?
During Q1 2026, Zillow Group repurchased 13.5 million shares for $626 million. The company reported approximately $1.3 billion remaining on its share repurchase authorizations at quarter-end, providing capacity for additional buybacks alongside other capital priorities.
What guidance did Zillow Group provide for Q2 2026 and full-year 2026?
For Q2 2026, Zillow expects revenue of $750–$765 million and Adjusted EBITDA of $150–$165 million. For full-year 2026, it continues to anticipate mid-teens revenue growth, roughly 30% Rentals growth, and year-over-year expansion in Adjusted EBITDA margin and net income.
How are Zillow Group’s user metrics trending in Q1 2026?
Average monthly unique users across Zillow’s apps and sites were 220 million in Q1 2026, down 3% year over year, with 2.3 billion visits. Comscore data cited by the company shows average monthly unique visitors of 127 million, up 12% year over year in its tracked category.