Zillow Group, Inc. (ZG) · Nov 4, 2026 · Earnings
Miss — Revenue $724M vs ~$754M consensus; FY26 EBITDA guide cut to $655M-$690M
Zillow earnings show resilient Rentals and adjusted profits, but Q3 revenue missed expectations and 2026 guidance was reduced.
Zillow is midway through a strategic shift from selling advertising leads to owning more of the real-estate transaction through Preferred agents, Zillow Home Loans, software and Rentals. That transition was already expected to pressure reported For Sale revenue; the new information is that the housing slowdown was worse than Zillow had planned for, forcing a lower full-year outlook.
The quarter missed the market’s top-line bar. Revenue was $724 million, below the roughly $754 million published consensus and below Zillow’s prior Q3 outlook of $745 million to $760 million. The shortfall was concentrated in housing-sensitive For Sale and mortgage conversion, while Rentals remained the growth engine.
| Q3 2026 | Q3 2025 | Consensus / prior guide | |
|---|---|---|---|
| Total revenue (Financial Highlights) | $724M (+7%) | $676M | ~$754M consensus |
| Adjusted EPS (Net Income section) | $0.55 | $0.44 | ~$0.58 consensus |
| Adjusted EBITDA (Financial Highlights) | $182M (+10%) | $165M | $180M-$200M guide |
| Rentals revenue (Segment results — Rentals) | $220M (+26%) | $174M | |
| Adjusted free cash flow (Cash Flow statement) | $46M (-57%) | $107M | |
| FY26 revenue outlook (Outlook) | 10%-11% growth | $2.92B-$2.96B prior guide | |
| FY26 Adjusted EBITDA outlook (Outlook) | $655M-$690M | $730M-$760M prior guide |
Rentals and the transaction platform are working, but not yet large enough to offset housing weakness. Rentals revenue grew 26%, multifamily revenue grew 35%, and the number of advertised multifamily properties reached a record 81,000. Preferred is also progressing: two-thirds of buyer connections now go to Preferred agents, versus about one-third a year ago, with full migration still targeted for the first half of 2027.
The core housing business is showing resilience relative to the industry, but reported growth is being squeezed from both sides. Residential revenue fell 4%, while mortgage revenue rose 32%; Zillow says its underlying For Sale and Residential performance outpaced industry purchase-mortgage volume by 600 basis points after adjusting for the Preferred transition. That supports the execution story, but the reported dollars still missed because higher mortgage rates reduced conversion and delayed the benefit of mortgage monetization. 〔0〕
The bigger negative is the outlook reset, not the one-time GAAP loss. The $158 million GAAP loss was dominated by the $165 million Zillow Offers securities settlement, which Zillow excludes from adjusted results and relates to a wound-down business. More important for the ongoing story, Zillow reduced its full-year revenue framework from $2.92 billion-$2.96 billion and Adjusted EBITDA from $730 million-$760 million to roughly 10%-11% revenue growth and $655 million-$690 million of EBITDA.
Bottom line: Zillow is executing well in Rentals and improving monetization per transaction, but the housing downturn is arriving faster than those initiatives can offset. This is a genuine earnings miss accompanied by a material outlook cut, so the near-term business read is modestly weaker even though the longer-term platform strategy remains intact.
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