CoStar Group Reports 20% Revenue Growth to $833.6 Million in Q3 2025

CoStar Group, Inc. reported significant financial results for the third quarter of 2025, with revenues reaching $833.6 million, a 20% increase from $692.6 million in the same period last year. The growth was driven by strong performances across various segments, particularly in Other Revenues, which surged by 142% due to the acquisition of Matterport. The Multifamily segment also saw an 11% increase, while Residential revenues nearly doubled, reflecting the impact of the Domain Acquisition and a rise in Homes.com memberships. However, the company recorded a net loss of $30.9 million, compared to a net income of $53 million in the prior year, primarily due to increased operating expenses and a significant rise in customer base amortization expenses.

In terms of operational metrics, CoStar's gross profit for the quarter was $661.4 million, maintaining a gross profit margin of 79%. Operating expenses increased by 35% to $712.5 million, largely driven by higher selling and marketing costs, which rose by 26% due to expanded sales efforts following the acquisitions. General and administrative expenses also saw a notable increase of 48%, reflecting the costs associated with integrating new acquisitions and expanding the workforce. The company’s interest income decreased significantly, falling by 53% to $26 million, attributed to a reduction in cash and cash equivalents.

CoStar's strategic developments included the completion of several acquisitions, notably the Matterport and Domain acquisitions, which are expected to enhance its service offerings and market position. The Matterport acquisition, finalized in February 2025, is anticipated to integrate 3D digital twin technology into CoStar's existing platforms, while the Domain acquisition, completed in August 2025, positions CoStar to leverage Domain's extensive property brands in Australia. These acquisitions are part of CoStar's broader strategy to expand its geographic footprint and enhance its technology capabilities.

As of September 30, 2025, CoStar reported total assets of $10.8 billion, up from $9.3 billion at the end of 2024, largely due to the goodwill generated from recent acquisitions, which totaled $4.9 billion. The company’s cash and cash equivalents decreased to $1.9 billion from $4.7 billion, primarily due to significant cash outflows related to acquisitions. CoStar's employee headcount has also increased, reflecting its growth strategy and the integration of new teams from acquired companies.

Looking ahead, CoStar Group anticipates continued revenue growth driven by its strategic investments in technology and market expansion. The company expects to see improvements in its revenue growth rates across its segments, particularly in Information Services and Residential, as it integrates its acquisitions and enhances its service offerings. However, the company also acknowledges potential challenges, including market conditions and the need to manage increased operational costs effectively.