Earnings Results: Zillow is almost done selling homes, but stock slumps as the hard part is still to come

by | Aug 4, 2022 | Stock Market

Zillow Group Inc. is almost done selling all the homes it bought in a flurry that led to a flameout of its iBuying business, but its plans for the future led to shares plunging in extended trading Thursday on a disappointing forecast. Zillow

on Thursday reported second-quarter earnings of $8 million, or 3 cents a share, on revenue of $1.01 billion, down from $1.31 billion in revenue a year ago. After adjusting for stock compensation and other effects, the real-estate services business reported earnings of 47 cents a share, up from 44 cents a share a year ago.

Analysts on average expected Zillow to report adjusted earnings of 35 cents a share on sales of $985 million, according to FactSet. Shares declined more than 8% in after-hours trading immediately following the release of the results Thursday, after closing with a 0.2% increase at $38.13. Zillow is expected to continue showing large declines in revenue as it exits the iBuying business and laps the periods in which it frantically sold houses that it bought in too large a quantity and at high prices last year, an effort that included just 71 homes for sale at the end of the second quarter. For the third quarter, executives predict $431 million to $461 million in revenue, a sharp decline from $1.74 billion in the same period a year ago an …

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