CoStar Group Second Quarter 2023 Revenue Increased 13% Year-over-Year and Net New Bookings Were $82 Million. CoStar Group Reaches 105 Million Monthly Visitors.

 

CoStar Group, Inc. (NASDAQ: CSGP), a leading provider of online real estate marketplaces, information and analytics in the property markets, announced today that revenue for the quarter ended June 30, 2023 was $606 million, 13% over revenue of $536 million for the quarter ended June 30, 2022. Net income was $101 million in the second quarter, an increase of 20% over prior year.

“We achieved another great quarter of very strong results in terms of revenue, sales and traffic to our websites,” said Andy Florance, Founder and Chief Executive Officer of CoStar Group. "Overall revenue grew an impressive 13% year-over-year, with Apartments.com revenue growth accelerating to 23% in the second quarter. Our sales team delivered $82 million net new bookings, which is the second highest quarter in our company's history. The Apartments.com team produced record results for the third quarter in a row, with net new bookings up 84% over prior year. Achieving these results despite commercial property transactions plummeting 63% in the second quarter, demonstrates the resilience of our platforms,” continued Florance.

Traffic to all of CoStar Group’s web sites reached a new high of 105 million unique visitors in June, according to Google Analytics, exceeding 100 million in the second quarter for the first time. Traffic to our residential network in the second quarter was 84 million average monthly unique visitors, according to Google Analytics. Homes.com network traffic grew 130% year over year in June to 38 million monthly unique visitors. “I believe we crossed a monumental milestone in June when our residential network became the second most heavily trafficked residential network. We crossed into third place in the first quarter of this year, surpassing Redfin’s first quarter self-reported traffic and estimated rental site traffic. In the second quarter we moved into second place surpassing Realtor.com’s self-reported traffic for their fiscal third quarter. I’m very encouraged by the progress we are making with our Homes.com strategy, as our traffic growth continues ahead of our initial expectations,” said Florance.

CoStar Group’s residential network combines residential rental site and homes for sale site traffic.

Year 2022-2023 Quarterly Results - Unaudited

(in millions, except per share data)

 

2022

 

2023

 

Q1

Q2

Q3

Q4

 

Q1

Q2

 

 

 

 

 

 

 

 

Revenues

$516

$536

$557

$573

 

$584

$606

Net income

89

83

72

124

 

87

101

Net income per share - diluted

0.23

0.21

0.18

0.31

 

0.21

0.25

Weighted average outstanding shares - diluted

394

394

396

406

 

406

407

 

 

 

 

 

 

 

 

EBITDA

158

140

129

155

 

98

105

Adjusted EBITDA

178

159

153

182

 

123

127

Non-GAAP net income

123

112

118

153

 

118

127

Non-GAAP net income per share - diluted

0.31

0.28

0.30

0.38

 

0.29

0.31

2023 Outlook

The Company expects revenue in the range of $2.45 billion to $2.46 billion for the full year of 2023, representing year-over-year growth of approximately 13% at the midpoint of the range. The revenue forecast is lower than prior guidance to reflect lower property transaction volume expectations in the second half of 2023, and the related impact on Ten-X revenue. The Company expects revenue for the third quarter of 2023 in the range of $622 million to $627 million, representing revenue growth of approximately 12% year-over-year at the midpoint of the range.

The Company expects adjusted EBITDA in the range of $510 million to $520 million for the full year of 2023. For the third quarter of 2023, the Company expects adjusted EBITDA in the range of $115 million to $120 million.

The Company expects full year 2023 non-GAAP net income per diluted share in a range of $1.24 to $1.26 based on 407 million shares. For the third quarter of 2023, the Company expects non-GAAP net income per diluted share in a range of $0.29 to $0.30 based on 407 million shares. These ranges include an estimated non-GAAP tax rate of 26% for the full year and the third quarter of 2023.

The preceding forward-looking statements reflect CoStar Group’s expectations as of July 25, 2023, including forward-looking non-GAAP financial measures on a consolidated basis, based on current estimates, expectations, observations, and trends. Given the risk factors, rapidly evolving economic environment, and uncertainties and assumptions discussed in this release and in our quarterly reports on Form 10-Q and annual reports on Form 10-K, actual results may differ materially. Other than in publicly available statements, the Company does not intend to update its forward-looking statements until its next quarterly results announcement.

Reconciliations of EBITDA, adjusted EBITDA, non-GAAP net income and non-GAAP net income per diluted share to the most directly comparable GAAP measures are shown in detail below, along with definitions for those terms. A reconciliation of forward-looking non-GAAP guidance to the most directly comparable GAAP measure, net income, can be found within the tables included in this release.

Non-GAAP Financial Measures

For information regarding the purpose for which management uses the non-GAAP financial measures disclosed in this release and why management believes they provide useful information to investors regarding the Company’s financial condition and results of operations, please refer to the Company’s latest periodic report.

EBITDA is a non-GAAP financial measure that represents GAAP net income attributable to CoStar Group before interest income or expense, net and other income or expense, net; loss on debt extinguishment; income taxes; depreciation and amortization.

Adjusted EBITDA is a non-GAAP financial measure that represents EBITDA before stock-based compensation expense, acquisition- and integration-related costs, restructuring costs, and settlements and impairments incurred outside the Company’s ordinary course of business. Adjusted EBITDA margin represents adjusted EBITDA divided by revenues for the period.

Non-GAAP net income is a non-GAAP financial measure determined by adjusting GAAP net income attributable to CoStar Group for stock-based compensation expense, acquisition- and integration-related costs, restructuring costs, settlement and impairment costs incurred outside the Company's ordinary course of business and loss on debt extinguishment, as well as amortization of acquired intangible assets and other related costs, and then subtracting an assumed provision for income taxes. In 2023, the Company is assuming a 26% tax rate in order to approximate its statutory corporate tax rate excluding the impact of discrete items.

Non-GAAP net income per diluted share is a non-GAAP financial measure that represents non-GAAP net income divided by the number of diluted shares outstanding for the period used in the calculation of GAAP net income per diluted share. For periods with GAAP net losses and non-GAAP net income, the weighted average outstanding shares used to calculate non-GAAP net income per share includes potentially dilutive securities that were excluded from the calculation of GAAP net income per share as the effect was anti-dilutive.

Operating Metrics

Net new bookings is calculated based on the annualized amount of change in the Company's sales bookings resulting from new subscription-based contracts, changes to existing subscription-based contracts and cancellations of subscription-based contracts for the period reported. Information regarding net new bookings is not comparable to, nor should it be substituted for, an analysis of the Company's revenues over time.

Earnings Conference Call

Management will conduct a conference call to discuss the second quarter 2023 results and the Company’s outlook at 5:00 PM ET on Tuesday, July 25, 2023. A live audio webcast of the conference will be available in listen-only mode through the Investors section of the CoStar Group website: https://investors.costargroup.com. A replay of the webcast audio will also be available in the Investors section of our website for a period of time following the call.

CoStar Group, Inc.

Condensed Consolidated Statements of Operations - Unaudited

(in thousands, except per share data)

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2023

 

2022

 

2023

 

2022

Revenues

 

$

605,906

 

$

536,308

 

 

$

1,190,272

 

$

1,052,133

 

Cost of revenues

 

 

112,362

 

 

100,971

 

 

 

231,558

 

 

196,450

 

Gross profit

 

 

493,544

 

 

435,337

 

 

 

958,714

 

 

855,683

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

Selling and marketing (excluding customer base amortization)

 

 

250,026

 

 

181,344

 

 

 

476,260

 

 

325,341

 

Software development

 

 

63,369

 

 

51,587

 

 

 

129,959

 

 

105,608

 

General and administrative

 

 

90,563

 

 

77,345

 

 

 

180,071

 

 

155,306

 

Customer base amortization

 

 

10,440

 

 

14,878

 

 

 

21,057

 

 

30,970

 

 

 

 

414,398

 

 

325,154

 

 

 

807,347

 

 

617,225

 

Income from operations

 

 

79,146

 

 

110,183

 

 

 

151,367

 

 

238,458

 

Interest income (expense), net

 

 

51,911

 

 

(3,399

)

 

 

95,459

 

 

(11,117

)

Other income, net

 

 

609

 

 

1,343

 

 

 

1,190

 

 

2,207

 

Income before income taxes

 

 

131,666

 

 

108,127

 

 

 

248,016

 

 

229,548

 

Income tax expense

 

 

31,146

 

 

24,654

 

 

 

60,365

 

 

56,757

 

Net income

 

$

100,520

 

$

83,473

 

 

$

187,651

 

$

172,791

 

 

 

 

 

 

 

 

 

 

Net income per share - basic

 

$

0.25

 

$

0.21

 

 

$

0.46

 

$

0.44

 

Net income per share - diluted

 

$

0.25

 

$

0.21

 

 

$

0.46

 

$

0.44

 

 

 

 

 

 

 

 

 

 

Weighted-average outstanding shares - basic

 

 

405,429

 

 

393,342

 

 

 

404,960

 

 

393,119

 

Weighted-average outstanding shares - diluted

 

 

406,751

 

 

394,478

 

 

 

406,454

 

 

394,356

 

CoStar Group, Inc.

Reconciliation of Non-GAAP Financial Measures - Unaudited

(in thousands, except per share data)

 

Reconciliation of Net Income to Non-GAAP Net Income

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2023

 

2022

 

2023

 

2022

Net income

 

$

100,520

 

 

$

83,473

 

 

$

187,651

 

 

$

172,791

 

Income tax expense

 

 

31,146

 

 

 

24,654

 

 

 

60,365

 

 

 

56,757

 

Income before income taxes

 

 

131,666

 

 

 

108,127

 

 

 

248,016

 

 

 

229,548

 

Amortization of acquired intangible assets

 

 

17,976

 

 

 

22,815

 

 

 

35,657

 

 

 

46,005

 

Stock-based compensation expense

 

 

21,826

 

 

 

18,112

 

 

 

41,871

 

 

 

35,959

 

Acquisition and integration related costs

 

 

(179

)

 

 

504

 

 

 

1,476

 

 

 

2,143

 

Restructuring and related costs

 

 

(51

)

 

 

 

 

 

3,371

 

 

 

 

Settlements and impairments

 

 

(30

)

 

 

 

 

 

(107

)

 

 

 

Other expense, net

 

 

 

 

 

2,063

 

 

 

 

 

 

4,099

 

Non-GAAP income before income taxes

 

 

171,208

 

 

 

151,621

 

 

 

330,284

 

 

 

317,754

 

Assumed rate for income tax expense(1)

 

 

26

%

 

 

26

%

 

 

26

%

 

 

26

%

Assumed provision for income tax expense

 

 

(44,514

)

 

 

(39,421

)

 

 

(85,874

)

 

 

(82,616

)

Non-GAAP net income

 

$

126,694

 

 

$

112,200

 

 

$

244,410

 

 

$

235,138

 

 

 

 

 

 

 

 

 

 

Net income per share - diluted

 

$

0.25

 

 

$

0.21

 

 

$

0.46

 

 

$

0.44

 

Non-GAAP net income per share - diluted

 

$

0.31

 

 

$

0.28

 

 

$

0.60

 

 

$

0.60

 

 

 

 

 

 

 

 

 

 

Weighted average outstanding shares - basic

 

 

405,429

 

 

 

393,342

 

 

 

404,960

 

 

 

393,119

 

Weighted average outstanding shares - diluted

 

 

406,751

 

 

 

394,478

 

 

 

406,454

 

 

 

394,356

 

__________________________

 

 

 

 

 

 

 

 

(1) The assumed tax rate approximates our statutory federal and state corporate tax rate for the applicable period.

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income to EBITDA and Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

 

2023

 

2022

 

2023

 

2022

Net income

 

$

100,520

 

 

$

83,473

 

 

$

187,651

 

 

$

172,791

 

Amortization of acquired intangible assets in cost of revenues

 

 

7,536

 

 

 

7,937

 

 

 

14,600

 

 

 

15,035

 

Amortization of acquired intangible assets in operating expenses

 

 

10,440

 

 

 

14,878

 

 

 

21,057

 

 

 

30,970

 

Depreciation and other amortization

 

 

8,087

 

 

 

7,010

 

 

 

16,033

 

 

 

13,975

 

Interest (income) expense, net

 

 

(51,911

)

 

 

3,399

 

 

 

(95,459

)

 

 

11,117

 

Other income, net

 

 

(609

)

 

 

(1,343

)

 

 

(1,190

)

 

 

(2,207

)

Income tax expense

 

 

31,146

 

 

 

24,654

 

 

 

60,365

 

 

 

56,757

 

EBITDA

 

$

105,209

 

 

$

140,008

 

 

$

203,057

 

 

$

298,438

 

Stock-based compensation expense

 

 

21,826

 

 

 

18,112

 

 

 

41,871

 

 

 

35,959

 

Acquisition and integration related costs

 

 

(179

)

 

 

504

 

 

 

1,476

 

 

 

2,143

 

Restructuring and related costs

 

 

(51

)

 

 

 

 

 

3,371

 

 

 

 

Settlements and impairments

 

 

(30

)

 

 

 

 

 

(107

)

 

 

Adjusted EBITDA

 

$

126,775

 

 

$

158,624

 

 

$

249,668

$

336,540

CoStar Group, Inc.

Condensed Consolidated Balance Sheets - Unaudited

(in thousands)

 

 

 

 

 

 

 

June 30,

2023

 

December 31,

2022

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

5,205,295

 

 

$

4,967,970

 

Accounts receivable

 

 

196,255

 

 

 

166,140

 

Less: Allowance for credit losses

 

 

(15,042

)

 

 

(12,195

)

Accounts receivable, net

 

 

181,213

 

 

 

153,945

 

Prepaid expenses and other current assets

 

 

58,376

 

 

 

63,952

 

Total current assets

 

 

5,444,884

 

 

 

5,185,867

 

 

 

 

 

 

Deferred income taxes, net

 

 

9,724

 

 

 

9,722

 

Property and equipment, net

 

 

359,455

 

 

 

321,250

 

Lease right-of-use assets

 

 

79,491

 

 

 

80,392

 

Goodwill

 

 

2,321,205

 

 

 

2,314,759

 

Intangible assets, net

 

 

295,022

 

 

 

329,306

 

Deferred commission costs, net

 

 

162,391

 

 

 

142,482

 

Deposits and other assets

 

 

17,497

 

 

 

16,687

 

Income tax receivable

 

 

2,005

 

 

 

2,005

 

Total assets

 

$

8,691,674

 

 

$

8,402,470

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

$

61,546

 

 

$

28,460

 

Accrued wages and commissions

 

 

100,915

 

 

 

104,988

 

Accrued expenses

 

 

115,654

 

 

 

89,113

 

Income taxes payable

 

 

11,100

 

 

 

10,438

 

Lease liabilities

 

 

40,329

 

 

 

36,049

 

Deferred revenue

 

 

113,231

 

 

 

103,567

 

Total current liabilities

 

 

442,775

 

 

 

372,615

 

 

 

 

 

 

Long-term debt, net

 

 

989,858

 

 

 

989,210

 

Deferred income taxes, net

 

 

69,280

 

 

 

76,202

 

Income taxes payable

 

 

16,978

 

 

 

14,001

 

Lease and other long-term liabilities

 

 

71,711

 

 

 

80,321

 

Total liabilities

 

$

1,590,602

 

 

$

1,532,349

 

 

 

 

 

 

Total stockholders' equity

 

 

7,101,072

 

 

 

6,870,121

 

Total liabilities and stockholders' equity

 

$

8,691,674

 

 

$

8,402,470

 

CoStar Group, Inc.

Condensed Consolidated Statements of Cash Flows - Unaudited

(in thousands)

 

 

 

Six months ended

June 30,

 

2023

 

2022

Operating activities:

 

 

 

Net income

$

187,651

 

 

$

172,791

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

51,690

 

 

 

64,127

 

Amortization of deferred commissions costs

 

45,267

 

 

 

35,996

 

Amortization of Senior Notes discount and issuance costs

 

1,197

 

 

 

1,178

 

Non-cash lease expense

 

14,147

 

 

 

15,080

 

Stock-based compensation expense

 

41,871

 

 

 

35,959

 

Deferred income taxes, net

 

(6,989

)

 

 

(14,946

)

Credit loss expense

 

13,938

 

 

 

6,890

 

Other operating activities, net

 

540

 

 

 

(1,149

)

 

 

 

 

Changes in operating assets and liabilities, net of acquisitions:

 

 

 

Accounts receivable

 

(40,601

)

 

 

(33,318

)

Prepaid expenses and other current assets

 

(4,220

)

 

 

3,152

 

Deferred commissions

 

(65,028

)

 

 

(54,155

)

Accounts payable and other liabilities

 

54,422

 

 

 

14,098

 

Lease liabilities

 

(16,559

)

 

 

(15,932

)

Income taxes payable, net

 

12,916

 

 

 

(27,770

)

Deferred revenue

 

8,873

 

 

 

8,520

 

Other assets

 

(735

)

 

 

1,578

 

Net cash provided by operating activities

 

298,380

 

 

 

212,099

 

 

 

 

 

Investing activities:

 

 

 

Proceeds from sale of property and equipment and other assets

 

 

 

 

5,034

 

Purchase of Richmond assets

 

(45,621

)

 

 

(25,664

)

Purchases of property and equipment and other assets

 

(8,801

)

 

 

(30,746

)

Cash paid for acquisitions, net of cash acquired

 

 

 

 

(6,331

)

Net cash used in investing activities

 

(54,422

)

 

 

(57,707

)

 

 

 

 

Financing activities:

 

 

 

Repayments of long-term debt assumed in acquisition

 

 

 

 

(2,155

)

Repurchase of restricted stock to satisfy tax withholding obligations

 

(22,445

)

 

 

(19,755

)

Proceeds from exercise of stock options and employee stock purchase plan

 

16,175

 

 

 

7,340

 

Net cash used in financing activities

 

(6,270

)

 

 

(14,570

)

 

 

 

 

Effect of foreign currency exchange rates on cash and cash equivalents

 

(363

)

 

 

(2,832

)

Net increase in cash and cash equivalents

 

237,325

 

 

 

136,990

 

Cash and cash equivalents at the beginning of period

 

4,967,970

 

 

 

3,827,126

 

Cash and cash equivalents at the end of period

$

5,205,295

 

 

$

3,964,116

 

CoStar Group, Inc.

Disaggregated Revenues - Unaudited

(in thousands)

 

 

 

Three Months Ended June 30,

 

2023

 

2022

 

North America

 

International

 

Total

 

North America

 

International

 

Total

CoStar

$

219,573

 

$

9,596

 

$

229,169

 

$

197,380

 

$

9,186

 

$

206,566

Information Services

 

32,213

 

 

9,708

 

 

41,921

 

 

30,511

 

 

7,991

 

 

38,502

Multifamily

 

224,291

 

 

 

 

224,291

 

 

182,359

 

 

 

 

182,359

LoopNet

 

63,268

 

 

2,295

 

 

65,563

 

 

54,603

 

 

1,694

 

 

56,297

Residential

 

12,708

 

 

 

 

12,708

 

 

20,154

 

 

 

 

20,154

Other Marketplaces

 

32,254

 

 

 

 

32,254

 

 

32,430

 

 

 

 

32,430

Total revenues

$

584,307

 

$

21,599

 

$

605,906

 

$

517,437

 

$

18,871

 

$

536,308

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30,

 

2023

 

2022

 

North America

 

International

 

Total

 

North America

 

International

 

Total

CoStar

$

435,386

 

$

18,796

 

$

454,182

 

$

386,484

 

$

18,731

 

$

405,215

Information Services

 

64,313

 

 

19,237

 

 

83,550

 

 

60,782

 

 

14,935

 

 

75,717

Multifamily

 

434,988

 

 

 

 

434,988

 

 

357,836

 

 

 

 

357,836

LoopNet

 

124,447

 

 

4,353

 

 

128,800

 

 

107,291

 

 

3,453

 

 

110,744

Residential

 

25,861

 

 

 

 

25,861

 

 

38,214

 

 

 

 

38,214

Other Marketplaces

 

62,891

 

 

 

 

62,891

 

 

64,407

 

 

 

 

64,407

Total revenues

$

1,147,886

 

$

42,386

 

$

1,190,272

 

$

1,015,014

 

$

37,119

 

$

1,052,133

 

 

 

 

 

 

 

 

 

 

 

CoStar Group, Inc.

Results of Segments - Unaudited

(in thousands)

 

 

 

 

 

 

 

 

 

Three Months Ended

June 30,

 

Six Months Ended

June 30,

 

2023

 

2022

 

2023

 

2022

EBITDA

 

 

 

 

 

 

 

North America

$

104,614

 

$

138,527

 

$

201,270

 

$

294,489

International

 

595

 

 

1,481

 

 

1,787

 

 

3,949

Total EBITDA

$

105,209

 

$

140,008

 

$

203,057

 

$

298,438

CoStar Group, Inc.

Reconciliation of Non-GAAP Financial Measures with Quarterly Results - Unaudited

(in millions, except per share data)

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income to Non-GAAP Net Income

 

 

 

 

 

 

 

 

 

 

 

2022

 

2023

 

 

Q1

Q2

Q3

Q4

 

Q1

Q2

Net income

 

$89.3

$83.5

$72.3

$124.4

 

$87.1

$100.5

Income tax expense

 

32.1

24.7

25.1

35.2

 

29.2

31.1

Income before income taxes

 

121.4

108.1

97.4

159.5

 

116.4

131.7

Amortization of acquired intangible assets

 

23.2

22.8

36.6

20.0

 

17.7

18.0

Stock-based compensation expense

 

17.8

18.1

18.1

21.1

 

20.0

21.8

Acquisition and integration related costs

 

1.6

0.5

1.1

2.2

 

1.7

(0.2)

Restructuring and related costs

 

0.2

2.0

 

3.4

(0.1)

Settlements and impairments

 

4.1

2.0

 

(0.1)

Other expense, net

 

2.0

2.1

2.1

 

Non-GAAP income before income taxes(1)

 

166.1

151.6

159.6

206.7

 

159.1

171.2

Assumed rate for income tax expense (2)

 

26%

26%

26%

26%

 

26%

26%

Assumed provision for income tax expense

 

(43.2)

(39.4)

(41.5)

(53.8)

 

(41.4)

(44.5)

Non-GAAP net income(1)

 

$122.9

$112.2

$118.1

$153.0

 

$117.7

$126.7

 

 

 

 

 

 

 

 

 

Non-GAAP net income per share - diluted

 

$0.31

$0.28

$0.30

$0.38

 

$0.21

$0.25

 

 

 

 

 

 

 

 

 

Weighted average outstanding shares - basic

 

392.9

393.3

394.7

404.2

 

404.5

405.4

Weighted average outstanding shares - diluted

 

394.2

394.5

396.2

406.1

 

406.2

406.8

__________________________

 

 

 

 

 

 

 

 

(1) Totals may not foot due to rounding.

(2) The assumed tax rate approximates our statutory federal and state corporate tax rate for the applicable period.

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income to EBITDA and Adjusted EBITDA

 

 

 

 

 

 

 

 

 

 

 

2022

 

2023

 

 

Q1

Q2

Q3

Q4

 

Q1

Q2

Net income

 

$89.3

$83.5

$72.3

$124.4

 

$87.1

$100.5

Amortization of acquired intangible assets

 

23.2

22.8

36.6

20.0

 

17.7

18.0

Depreciation and other amortization

 

7.0

7.0

7.2

7.9

 

7.9

8.1

Interest expense (income), net

 

7.7

3.4

(10.7)

(32.6)

 

(43.5)

(51.9)

Other (income) expense, net

 

(0.9)

(1.3)

(1.4)

0.2

 

(0.6)

(0.6)

Income tax expense

 

32.1

24.7

25.1

35.2

 

29.2

31.1

EBITDA(1)

 

$158.4

$140.0

$129.1

$155.1

 

$97.8

$105.2

Stock-based compensation expense

 

17.8

18.1

18.1

21.1

 

20.0

21.8

Acquisition and integration related costs

 

1.6

0.5

1.1

2.2

 

1.7

(0.2)

Restructuring and related costs

 

0.2

2.0

 

3.4

(0.1)

Settlements and impairments

 

4.1

2.0

 

(0.1)

Adjusted EBITDA(1)

 

$177.9

$158.6

$152.7

$182.3

 

$122.9

$126.8

__________________________

 

 

 

 

 

 

 

 

(1) Totals may not foot due to rounding.

CoStar Group, Inc.

Reconciliation of Forward-Looking Guidance - Unaudited

(in thousands, except per share data)

 

Reconciliation of Forward-Looking Guidance, Net Income to Non-GAAP Net Income

 

 

 

 

 

Guidance Range

 

Guidance Range

 

For the Three Months

 

For the Year Ending

 

Ending September 30, 2023

 

December 31, 2023

 

Low

 

High

 

Low

 

High

 

 

 

 

 

 

 

 

Net income

$

86,000

 

 

$

90,000

 

 

$

376,000

 

 

$

383,000

 

Income tax expense

 

32,000

 

 

 

33,000

 

 

 

138,000

 

 

 

141,000

 

Income before income taxes

 

118,000

 

 

 

123,000

 

 

 

514,000

 

 

 

524,000

 

Amortization of acquired intangible assets

 

19,000

 

 

 

19,000

 

 

 

73,000

 

 

 

73,000

 

Stock-based compensation expense

 

23,000

 

 

 

23,000

 

 

 

89,000

 

 

 

89,000

 

Acquisition and integration related costs

 

 

 

 

 

 

 

1,000

 

 

 

1,000

 

Restructuring and related costs

 

 

 

 

 

 

 

3,000

 

 

 

3,000

 

Non-GAAP income before income taxes

 

160,000

 

 

 

165,000

 

 

 

680,000

 

 

 

690,000

 

Assumed rate for income tax expense(1)

 

26

%

 

 

26

%

 

 

26

%

 

 

26

%

Assumed provision for income tax expense

 

(41,600

)

 

 

(42,900

)

 

 

(176,800

)

 

 

(179,400

)

Non-GAAP net income

$

118,400

 

 

$

122,100

 

 

$

503,200

 

 

$

510,600

 

 

 

 

 

 

 

 

 

Net income per share - diluted

$

0.21

 

 

$

0.22

 

 

$

0.92

 

 

$

0.94

 

Non-GAAP net income per share - diluted

$

0.29

 

 

$

0.30

 

 

$

1.24

 

 

$

1.26

 

 

 

 

 

 

 

 

 

Weighted average outstanding shares - diluted

 

407,000

 

 

 

407,000

 

 

 

406,800

 

 

 

406,800

 

__________________________

 

 

 

 

 

 

 

(1) The assumed tax rate approximates our statutory federal and state corporate tax rate for the applicable period.

 

 

 

 

 

 

 

 

Reconciliation of Forward-Looking Guidance, Net Income to Adjusted EBITDA

 

 

 

 

 

Guidance Range

 

Guidance Range

 

For the Three Months

 

For the Year Ending

 

Ending September 30, 2023

 

December 31, 2023

 

Low

 

High

 

Low

 

High

Net income

$

86,000

 

 

$

90,000

 

 

$

376,000

 

 

$

383,000

 

Amortization of acquired intangible assets

 

19,000

 

 

 

19,000

 

 

 

73,000

 

 

 

73,000

 

Depreciation and other amortization

 

9,000

 

 

 

9,000

 

 

 

34,000

 

 

 

34,000

 

Interest income, net

 

(54,000

)

 

 

(54,000

)

 

 

(203,000

)

 

 

(203,000

)

Other income, net

 

 

 

 

 

 

 

(1,000

)

 

 

(1,000

)

Income tax expense

 

32,000

 

 

 

33,000

 

 

 

138,000

 

 

 

141,000

 

Stock-based compensation expense

 

23,000

 

 

 

23,000

 

 

 

89,000

 

 

 

89,000

 

Acquisition and integration related costs

 

 

 

 

 

 

 

1,000

 

 

 

1,000

 

Restructuring and related costs

 

 

 

 

 

 

 

3,000

 

 

 

3,000

 

Adjusted EBITDA

$

115,000

 

 

$

120,000

 

 

$

510,000

 

 

$

520,000

 

About CoStar Group

CoStar Group (NASDAQ: CSGP) is a leading provider of online real estate marketplaces, information, and analytics in the property markets. Founded in 1987, CoStar Group conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of real estate information. CoStar is the global leader in commercial real estate information, analytics, and news, enabling clients to analyze, interpret and gain unmatched insight on property values, market conditions and availabilities. Apartments.com is the leading online marketplace for renters seeking great apartment homes, providing property managers and owners a proven platform for marketing their properties. LoopNet is the most heavily trafficked online commercial real estate marketplace with over twelve million monthly global unique visitors. STR provides premium data benchmarking, analytics, and marketplace insights for the global hospitality industry. Ten-X offers a leading platform for conducting commercial real estate online auctions and negotiated bids. Homes.com is the fastest growing online residential marketplace that connects agents, buyers, and sellers. BureauxLocaux is one of the largest specialized property portals for buying and leasing commercial real estate in France. Business Immo is France’s leading commercial real estate news service. Thomas Daily is Germany’s largest online data pool in the real estate industry. Belbex is the premier source of commercial space available to let and for sale in Spain. CoStar Group’s websites attract nearly 100 million unique monthly visitors. Headquartered in Washington, DC, CoStar Group maintains offices throughout the U.S., Europe, Canada, and Asia. From time to time, we plan to utilize our corporate website, CoStarGroup.com, as a channel of distribution for material company information. For more information, visit CoStarGroup.com.

This news release and the Company’s earnings conference call contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about CoStar Group's plans, objectives, expectations, beliefs and intentions and other statements including words such as “hope,” “anticipate,” “may,” “believe,” “expect,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential” or the negative of these terms or other comparable terminology. Such statements are based upon the current beliefs and expectations of management of CoStar Group and are subject to many risks and uncertainties. Actual results may differ materially from the results anticipated in the forward-looking statements and the assumptions and estimates used as a basis for the forward-looking statements. The following factors, among others, could cause or contribute to such differences: the risk that the trends stated or implied by this release or in the earnings conference call cannot or will not be sustained at the current pace or may increase or decrease, including trends and expectations related to revenue, revenue growth, net income, non-GAAP net income, EBITDA, adjusted EBITDA, adjusted EBITDA margin, sales, net new bookings, site traffic and visitors, leads, and renewal rates; the risk that the Company is unable to sustain current Company-wide, CoStar, Apartments or LoopNet net new bookings; the risk that revenues for the third quarter and full year 2023 will not be as stated in this press release; the risk that net income for the third quarter and full year 2023 will not be as stated in this press release; the risk that EBITDA for the third quarter and full year 2023 will not be as stated in this press release; the risk that adjusted EBITDA for the third quarter and full year 2023 will not be as stated in this press release; the risk that non-GAAP net income and non-GAAP net income per diluted share for the third quarter and full year 2023 will not be as stated in this press release; the risk that we may not successfully integrate acquired businesses or assets and may not achieve anticipated benefits of an acquisition, including expected synergies; the risk that the tax rate estimates stated in this press release may change and the risk that we may experience declines in our revenues, revenue growth rates and profitability due to the impact of economic conditions on the real estate industry and our core customer base. More information about potential factors that could cause results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, those stated in CoStar Group’s filings from time to time with the Securities and Exchange Commission (the "SEC"), including in CoStar Group’s Annual Report on Form 10-K for the year ended December 31, 2022 and Quarterly Report on Form 10-Q for the quarters ended March 31, and June 30, 2023, each of which is filed with the SEC, including in the “Risk Factors” section of those filings, as well as CoStar Group’s other filings with the SEC (including Current Reports on Form 8-K) available at the SEC’s website (www.sec.gov). All forward-looking statements are based on information available to CoStar Group on the date hereof, and CoStar Group assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

"CoStar Group Reaches 105 Million Monthly Visitors"

Contacts

Investor Relations:

Cyndi Eakin

Senior Vice President

CoStar Group Investor Relations

(202) 346-6784

ceakin@costar.com

News Media:

Matthew Blocher

Vice President

CoStar Group Corporate Marketing & Communications

(202) 346-6775

mblocher@costar.com

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