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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________________________
FORM 10-Q
_____________________________________________________

☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number: 001-36853
_____________________________________________________
ZILLOW GROUP, INC.
(Exact name of registrant as specified in its charter)
_____________________________________________________

Washington |  | 47-1645716
(State or other jurisdiction of |  | (I.R.S. Employer
incorporation or organization) |  | Identification No.)

1301 Second Avenue, Floor 36,
Seattle, Washington 98101
(Address of principal executive offices) (Zip Code)
(206) 470-7000
(Registrant’s telephone number, including area code)
_____________________________________________________
Securities registered pursuant to Section 12(b) of the Act:

Title of each class | Trading Symbol(s) | Name of each exchange on which registered
Class A Common Stock, par value $0.0001 per share | ZG | The Nasdaq Global Select Market
Class C Capital Stock, par value $0.0001 per share | Z | The Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer |  | ☒ |  |  | Accelerated filer |  | ☐
Non-accelerated filer |  | ☐ |  |  | Smaller reporting company |  | ☐
|  |  |  |  | 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. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of October 23, 2025, 49,633,032 shares of Class A common stock, 6,217,447 shares of Class B common stock and 186,200,151 shares of Class C capital stock were outstanding.

Table of Contents
ZILLOW GROUP, INC.
Quarterly Report on Form 10-Q
For the Three Months Ended September 30, 2025
TABLE OF CONTENTS

|  | Page
PART I – FINANCIAL INFORMATION
| Glossary of Terms | 1
Item 1. | Financial Statements (unaudited) | 4
| Condensed Consolidated Balance Sheets | 4
| Condensed Consolidated Statements of Operations | 5
| Condensed Consolidated Statements of Comprehensive Income (Loss) | 6
| Condensed Consolidated Statements of Shareholders’ Equity | 7
| Condensed Consolidated Statements of Cash Flows | 9
| Notes to Condensed Consolidated Financial Statements | 10
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 24
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 40
Item 4. | Controls and Procedures | 41
PART II – OTHER INFORMATION
Item 1. | Legal Proceedings | 42
Item 1A. | Risk Factors | 43
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 44
Item 5. | Other Information | 45
Item 6. | Exhibits | 46
| Signatures | 47

i

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GLOSSARY OF TERMS
As used in this Quarterly Report on Form 10-Q, the terms identified below have the meanings specified below unless otherwise noted or the context indicates otherwise:

Abbreviation, Acronym or Common Term |  | Definition
Zillow Group, “the Company,” “we,” “us” and “our” |  | Refers to Zillow Group, Inc., unless the context indicates otherwise as used in this Quarterly Report on Form 10-Q
2024 Notes |  | 0.75% Convertible Senior Notes fully settled in September 2024
2025 Notes |  | 2.75% Convertible Senior Notes fully settled in May 2025
2026 Notes |  | 1.375% Convertible Senior Notes fully settled in December 2024
Board |  | Board of Directors of Zillow Group, Inc.
Exchange Act |  | Securities Exchange Act of 1934, as amended
FASB |  | Financial Accounting Standards Board
GAAP |  | Generally accepted accounting principles in the United States
IRLC |  | Interest rate lock commitment
Lenders |  | JPMorgan Chase Bank, N.A., UBS AG, Bank of Montreal, and Bank of Nova Scotia
MBS |  | Mortgage-backed security
MLS |  | Multiple Listing Service
NAR |  | National Association of REALTORS®
Repurchase Authorizations |  | A series of authorizations from the Board to repurchase Class A common stock, Class C capital stock, convertible senior notes, or a combination thereof
SEC |  | United States Securities and Exchange Commission
SOFR |  | Secured Overnight Financing Rate
TTV |  | Total Transaction Value for the residential real estate industry

1

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NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q, including Part I, Item 2 (Management’s Discussion and Analysis of Financial Condition and Results of Operations), contains forward-looking statements based on our management’s beliefs and assumptions and on information currently available to our management. Forward-looking statements include all statements that are not historical facts and generally may be identified by terms such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “could,” “would,” “project,” “plan,” “expect,” “potential,” “might” or the negative or plural of these words or similar expressions.
These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those risks, uncertainties and assumptions described in Part II, Item 1A (Risk Factors) in this Quarterly Report on Form 10-Q and Part I, Item 1A (Risk Factors) in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, including, but not limited to risks related 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 applications 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 NAR, MLSs, 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 targets and disclosures related to environmental, social and governance 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 applications 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 generative 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.
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Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the effect of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
You should not rely on forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, except as required by law, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements, and we undertake no obligation to update publicly any forward-looking statements for any reason after the date of this report to conform these statements to actual results or to changes in our expectations.
In addition, statements such as “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q. While we believe that such information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.
NOTE REGARDING INDUSTRY AND MARKET DATA
This Quarterly Report on Form 10-Q contains market and industry data that are based on our own internal estimates and research, as well as independent industry publications, trade or business organizations and other statistical information from third parties. Third-party information generally states that the information contained therein has been obtained from sources believed to be reliable. We have not independently verified any of the data from third-party sources nor have we validated the underlying economic assumptions relied on therein. The content of, or accessibility through, these market and industry data sources, except to the extent specifically set forth in this Quarterly Report on Form 10-Q, does not constitute a portion of this report and are not incorporated herein, and any sources are an inactive textual reference only.
WHERE YOU CAN FIND MORE INFORMATION
Our filings with the SEC, including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, are available on the “Investors” section of our website at www.zillowgroup.com, free of charge, as soon as reasonably practicable after the electronic filing of these reports with the SEC. The information contained on our website is not a part of this Quarterly Report on Form 10-Q or any other document we file with the SEC.
Investors and others should note that Zillow Group announces material financial information to its investors using its press releases, SEC filings and public conference calls and webcasts. Zillow Group intends to also use the following channels as a means of disclosing information about Zillow Group, its services and other matters, and for complying with its disclosure obligations under Regulation FD:
•Zillow Group Investor Relations Site (https://investors.zillowgroup.com)
•Zillow Group Blog (https://www.zillowgroup.com/news/)
•Zillow Group X Account (https://X.com/zillowgroup)
•Zillow Group LinkedIn Account (https://www.linkedin.com/company/zillow)
The information Zillow Group posts through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following Zillow Group’s press releases, SEC filings and public conference calls and webcasts. This list may be updated from time to time and reflects current updated channels as of the date of this Quarterly Report on Form 10-Q. The information we post through these channels is not a part of this Quarterly Report on Form 10-Q or any other document we file with the SEC, and the inclusion of our website addresses, X Account and LinkedIn Account are as inactive textual references only.
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PART I – FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)
ZILLOW GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, except share data, unaudited)

| September 30, 2025 |  | December 31, 2024
Assets |  |  |
Current assets: |  |  |
Cash and cash equivalents | $ | 874 |  |  | $ | 1,082 |
Short-term investments | 515 |  |  | 776 |
Accounts receivable, net | 157 |  |  | 104 |
Mortgage loans held for sale | 291 |  |  | 159 |
Prepaid expenses and other current assets | 277 |  |  | 210 |
Restricted cash | 5 |  |  | 3 |
Total current assets | 2,119 |  |  | 2,334 |
Contract cost assets | 27 |  |  | 25 |
Property and equipment, net | 371 |  |  | 360 |
Right of use assets | 58 |  |  | 59 |
Goodwill | 2,823 |  |  | 2,823 |
Intangible assets, net | 273 |  |  | 207 |
Other assets | 27 |  |  | 21 |
Total assets | $ | 5,698 |  |  | $ | 5,829 |
Liabilities and shareholders’ equity |  |  |
Current liabilities: |  |  |
Accounts payable | $ | 38 |  |  | $ | 30 |
Accrued expenses and other current liabilities | 133 |  |  | 105 |
Accrued compensation and benefits | 59 |  |  | 57 |
Borrowings under credit facilities | 272 |  |  | 145 |
Deferred revenue | 69 |  |  | 62 |
Lease liabilities, current portion | 13 |  |  | 14 |
Convertible senior notes | — |  |  | 418 |
Total current liabilities | 584 |  |  | 831 |
Lease liabilities, net of current portion | 82 |  |  | 83 |
Other long-term liabilities | 40 |  |  | 67 |
Total liabilities | 706 |  |  | 981 |
Commitments and contingencies (Note 11) |  |  |
Shareholders’ equity: |  |  |
Preferred stock, $0.0001 par value; authorized — 30,000,000 shares; no shares issued and outstanding | — |  |  | — |
Class A common stock, $0.0001 par value; authorized — 1,245,000,000 shares; issued and outstanding — 49,633,032 and 54,333,292 shares as of September 30, 2025 and December 31, 2024, respectively | — |  |  | — |
Class B common stock, $0.0001 par value; authorized — 15,000,000 shares; issued and outstanding — 6,217,447 shares | — |  |  | — |
Class C capital stock, $0.0001 par value; authorized — 600,000,000 shares; issued and outstanding — 186,184,854 and 181,937,981 shares as of September 30, 2025 and December 31, 2024, respectively | — |  |  | — |
Additional paid-in capital | 6,852 |  |  | 6,733 |
Accumulated other comprehensive income (loss) | 2 |  |  | (3) |
Accumulated deficit | (1,862) |  |  | (1,882) |
Total shareholders’ equity | 4,992 |  |  | 4,848 |
Total liabilities and shareholders’ equity | $ | 5,698 |  |  | $ | 5,829 |

See accompanying notes to the condensed consolidated financial statements.
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ZILLOW GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except share data, which are presented in thousands, and per share data, unaudited)

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Revenue: |  |  |  |  |  |  |
For Sale revenue: |  |  |  |  |  |  |
Residential | $ | 435 |  |  | $ | 405 |  |  | $ | 1,286 |  |  | $ | 1,207 |
Mortgages | 53 |  |  | 39 |  |  | 142 |  |  | 104 |
Total For Sale revenue | 488 |  |  | 444 |  |  | 1,428 |  |  | 1,311 |
Rentals | 174 |  |  | 123 |  |  | 462 |  |  | 337 |
Other | 14 |  |  | 14 |  |  | 39 |  |  | 34 |
Total revenue | 676 |  |  | 581 |  |  | 1,929 |  |  | 1,682 |
Cost of revenue | 185 |  |  | 140 |  |  | 490 |  |  | 393 |
Gross profit | 491 |  |  | 441 |  |  | 1,439 |  |  | 1,289 |
Operating expenses: |  |  |  |  |  |  |
Sales and marketing | 214 |  |  | 217 |  |  | 638 |  |  | 588 |
Technology and development | 151 |  |  | 145 |  |  | 453 |  |  | 436 |
General and administrative | 127 |  |  | 123 |  |  | 369 |  |  | 386 |
Impairment costs | 2 |  |  | — |  |  | 2 |  |  | 6 |
Acquisition-related costs | — |  |  | 1 |  |  | — |  |  | 1 |
Total operating expenses | 494 |  |  | 486 |  |  | 1,462 |  |  | 1,417 |
Loss from operations | (3) |  |  | (45) |  |  | (23) |  |  | (128) |
Loss on extinguishment of debt | — |  |  | — |  |  | — |  |  | (1) |
Other income, net | 18 |  |  | 34 |  |  | 58 |  |  | 101 |
Interest expense | (3) |  |  | (9) |  |  | (13) |  |  | (28) |
Income (loss) before income taxes | 12 |  |  | (20) |  |  | 22 |  |  | (56) |
Income tax expense | (2) |  |  | — |  |  | (2) |  |  | (4) |
Net income (loss) | $ | 10 |  |  | $ | (20) |  |  | $ | 20 |  |  | $ | (60) |
Net income (loss) per share: |  |  |  |  |  |  |
Basic | $ | 0.04 |  |  | $ | (0.08) |  |  | $ | 0.08 |  |  | $ | (0.26) |
Diluted | $ | 0.04 |  |  | $ | (0.08) |  |  | $ | 0.08 |  |  | $ | (0.26) |
Weighted-average shares outstanding: |  |  |  |  |  |  |
Basic | 242,326 |  |  | 232,521 |  |  | 241,889 |  |  | 233,553 |
Diluted | 256,243 |  |  | 232,521 |  |  | 254,700 |  |  | 233,553 |

See accompanying notes to the condensed consolidated financial statements.
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ZILLOW GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in millions, unaudited)

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Net income (loss) | $ | 10 |  |  | $ | (20) |  |  | $ | 20 |  |  | $ | (60) |
Other comprehensive income: |  |  |  |  |  |  |
Net unrealized gains on investments | 1 |  |  | 15 |  |  | 5 |  |  | 9 |
Total other comprehensive income | 1 |  |  | 15 |  |  | 5 |  |  | 9 |
Comprehensive income (loss) | $ | 11 |  |  | $ | (5) |  |  | $ | 25 |  |  | $ | (51) |

See accompanying notes to the condensed consolidated financial statements.
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ZILLOW GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(in millions, except share data, which are presented in thousands, unaudited)

| Class A Common Stock, Class B Common Stock and Class C Capital Stock |  | Additional Paid-In Capital |  | Accumulated Deficit |  | Accumulated Other Comprehensive Income |  | Total Shareholders’ Equity
Shares |  | Amount |
Balance at July 1, 2025 | 241,132 |  |  | $ | — |  |  | $ | 6,617 |  |  | $ | (1,872) |  |  | $ | 1 |  |  | $ | 4,746 |
Issuance of Class C capital stock upon exercise of stock options | 2,873 |  |  | — |  |  | 121 |  |  | — |  |  | — |  |  | 121 |
Vesting of restricted stock units | 1,584 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Share-based compensation expense | — |  |  | — |  |  | 114 |  |  | — |  |  | — |  |  | 114 |
Settlement of capped call transactions | (3,097) |  |  | — |  |  | 38 |  |  | — |  |  | — |  |  | 38 |
Repurchases of Class A common stock | (457) |  |  | — |  |  | (38) |  |  | — |  |  | — |  |  | (38) |
Net income | — |  |  | — |  |  | — |  |  | 10 |  |  | — |  |  | 10 |
Other comprehensive income | — |  |  | — |  |  | — |  |  | — |  |  | 1 |  |  | 1 |
Balance at September 30, 2025 | 242,035 |  |  | $ | — |  |  | $ | 6,852 |  |  | $ | (1,862) |  |  | $ | 2 |  |  | $ | 4,992 |

| Class A Common Stock, Class B Common Stock and Class C Capital Stock |  | Additional Paid-In Capital |  | Accumulated Deficit |  | Accumulated Other Comprehensive Income (Loss) |  | Total Shareholders’ Equity
Shares |  | Amount |
Balance at July 1, 2024 | 231,407 |  |  | $ | — |  |  | $ | 6,322 |  |  | $ | (1,810) |  |  | $ | (11) |  |  | $ | 4,501 |
Issuance of Class C capital stock upon exercise of stock options | 893 |  |  | — |  |  | 35 |  |  | — |  |  | — |  |  | 35 |
Vesting of restricted stock units | 1,442 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Share-based compensation expense | — |  |  | — |  |  | 124 |  |  | — |  |  | — |  |  | 124 |
Settlement of capped call transactions | (2,141) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Settlement of 2024 Notes | 1,935 |  |  | — |  |  | 1 |  |  | — |  |  | — |  |  | 1 |
Net loss | — |  |  | — |  |  | — |  |  | (20) |  |  | — |  |  | (20) |
Other comprehensive income | — |  |  | — |  |  | — |  |  | — |  |  | 15 |  |  | 15 |
Balance at September 30, 2024 | 233,536 |  |  | $ | — |  |  | $ | 6,482 |  |  | $ | (1,830) |  |  | $ | 4 |  |  | $ | 4,656 |

See accompanying notes to the condensed consolidated financial statements.
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| Class A Common Stock, Class B Common Stock and Class C Capital Stock |  | Additional Paid-In Capital |  | Accumulated Deficit |  | Accumulated Other Comprehensive Income (Loss) |  | Total Shareholders’ Equity
Shares |  | Amount |
Balance at January 1, 2025 | 242,489 |  |  | $ | — |  |  | $ | 6,733 |  |  | $ | (1,882) |  |  | $ | (3) |  |  | $ | 4,848 |
Issuance of Class C capital stock upon exercise of stock options | 4,193 |  |  | — |  |  | 176 |  |  | — |  |  | — |  |  | 176 |
Vesting of restricted stock units | 4,551 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Share-based compensation expense | — |  |  | — |  |  | 343 |  |  | — |  |  | — |  |  | 343 |
Settlement of capped call transactions | (3,097) |  |  | — |  |  | 38 |  |  | — |  |  | — |  |  | 38 |
Settlement of 2025 Notes | 1 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Repurchases of Class A common stock and Class C capital stock | (6,102) |  |  | — |  |  | (438) |  |  | — |  |  | — |  |  | (438) |
Net income | — |  |  | — |  |  | — |  |  | 20 |  |  | — |  |  | 20 |
Other comprehensive income | — |  |  | — |  |  | — |  |  | — |  |  | 5 |  |  | 5 |
Balance at September 30, 2025 | 242,035 |  |  | $ | — |  |  | $ | 6,852 |  |  | $ | (1,862) |  |  | $ | 2 |  |  | $ | 4,992 |

| Class A Common Stock, Class B Common Stock and Class C Capital Stock |  | Additional Paid-In Capital |  | Accumulated Deficit |  | Accumulated Other Comprehensive Income (Loss) |  | Total Shareholders’ Equity
Shares |  | Amount |
Balance at January 1, 2024 | 233,354 |  |  | $ | — |  |  | $ | 6,301 |  |  | $ | (1,770) |  |  | $ | (5) |  |  | $ | 4,526 |
Issuance of Class C capital stock upon exercise of stock options | 2,517 |  |  | — |  |  | 96 |  |  | — |  |  | — |  |  | 96 |
Vesting of restricted stock units | 4,967 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Share-based compensation expense | — |  |  | — |  |  | 385 |  |  | — |  |  | — |  |  | 385 |
Settlement of capped call transactions | (2,141) |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Settlement of 2024 Notes | 1,935 |  |  | — |  |  | 1 |  |  | — |  |  | — |  |  | 1 |
Repurchases of Class A common stock and Class C capital stock | (7,096) |  |  | — |  |  | (301) |  |  | — |  |  | — |  |  | (301) |
Net loss | — |  |  | — |  |  | — |  |  | (60) |  |  | — |  |  | (60) |
Other comprehensive income | — |  |  | — |  |  | — |  |  | — |  |  | 9 |  |  | 9 |
Balance at September 30, 2024 | 233,536 |  |  | $ | — |  |  | $ | 6,482 |  |  | $ | (1,830) |  |  | $ | 4 |  |  | $ | 4,656 |

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ZILLOW GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions, unaudited)

| Nine Months Ended September 30,
| 2025 |  | 2024
Operating activities |  |  |
Net income (loss) | $ | 20 |  |  | $ | (60) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |  |  |
Depreciation and amortization | 199 |  |  | 178 |
Share-based compensation | 295 |  |  | 329 |
Amortization of right of use assets | 6 |  |  | 8 |
Amortization of contract cost assets | 16 |  |  | 14 |
Amortization of debt issuance costs | 1 |  |  | 4 |
Impairment costs | 2 |  |  | 6 |
Accretion of bond discount | (7) |  |  | (23) |
Other adjustments to reconcile net income (loss) to net cash provided by operating activities | (6) |  |  | 14 |
Changes in operating assets and liabilities: |  |  |
Accounts receivable | (53) |  |  | (21) |
Mortgage loans held for sale | (132) |  |  | (64) |
Prepaid expenses and other assets | (67) |  |  | (73) |
Contract cost assets | (18) |  |  | (15) |
Lease liabilities | (9) |  |  | (31) |
Accounts payable | 8 |  |  | 25 |
Accrued expenses and other current liabilities | 32 |  |  | 8 |
Accrued compensation and benefits | 2 |  |  | 2 |
Deferred revenue | 7 |  |  | 5 |
Net cash provided by operating activities | 296 |  |  | 306 |
Investing activities |  |  |
Proceeds from maturities of investments | 338 |  |  | 906 |
Proceeds from sales of investments | 61 |  |  | 13 |
Purchases of investments | (127) |  |  | (668) |
Purchases of property and equipment | (105) |  |  | (109) |
Purchases of intangible assets | (123) |  |  | (21) |
Net cash provided by investing activities | 44 |  |  | 121 |
Financing activities |  |  |
Net borrowings on repurchase agreements | 127 |  |  | 55 |
Repurchases of Class A common stock and Class C capital stock | (438) |  |  | (301) |
Settlement of convertible senior notes | (419) |  |  | (697) |
Proceeds from settlement of capped call transactions | 38 |  |  | — |
Proceeds from exercise of stock options | 176 |  |  | 96 |
Payment of contingent consideration for acquisition | (30) |  |  | — |
Net cash used in financing activities | (546) |  |  | (847) |
Net decrease in cash, cash equivalents and restricted cash during period | (206) |  |  | (420) |
Cash, cash equivalents and restricted cash at beginning of period | 1,085 |  |  | 1,495 |
Cash, cash equivalents and restricted cash at end of period | $ | 879 |  |  | $ | 1,075 |
Supplemental disclosures of cash flow information |  |  |
Noncash transactions: |  |  |
Write-off of fully depreciated property and equipment | $ | 116 |  |  | $ | 63 |
Write-off of fully amortized intangible assets | 58 |  |  | 21 |
Capitalized share-based compensation | 48 |  |  | 56 |

See accompanying notes to the condensed consolidated financial statements.
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ZILLOW GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Index to Notes to Condensed Consolidated Financial Statements

|  | Page
Note 1. | Organization and Description of Business | 10
Note 2. | Summary of Significant Accounting Policies | 11
Note 3. | Financial Instruments | 12
Note 4. | Property and Equipment, Net | 15
Note 5. | Intangible Assets, Net | 15
Note 6. | Debt | 16
Note 7. | Income Taxes | 17
Note 8. | Share Repurchase Authorizations | 18
Note 9. | Share-Based Awards | 18
Note 10. | Net Income (Loss) Per Share | 20
Note 11. | Commitments and Contingencies | 20
Note 12. | Revenue and Contract Balances | 22
Note 13. | Segment Information | 23

Note 1. Organization and Description of Business
Zillow Group 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 and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated real estate professionals, and easier buying, selling, financing and renting experiences.
Our portfolio of affiliates, subsidiaries and brands includes Zillow Premier Agent, Zillow Home Loans, our mortgage origination operations and affiliate lender, Zillow Rentals, Trulia, StreetEasy, HotPads and Out East. In addition, Zillow Group provides a comprehensive suite of marketing software and technology solutions for the real estate industry, including ShowingTime+, Spruce and Follow Up Boss.
Certain Significant Risks and Uncertainties
We operate in a dynamic industry and, accordingly, can be affected by a variety of factors, which are uncertain and difficult to predict. For example, we believe that potential changes in any of the following areas may have a significant impact on us in terms of our future financial position, results of operations or cash flows: 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 navigate industry changes, including as a result of past, pending or future lawsuits, settlements or government investigations; uncertainties related to policy changes, enforcement priorities, or government shutdowns at the federal and state levels; our ability to manage advertising, product inventory and pricing, and to maintain relationships with our real estate partners; our ability to comply with current and future rules and requirements promulgated by NAR, MLSs, or other real estate industry groups or governing bodies, and to maintain or establish relationships with listing and data providers; changes to our rights to use or timely access listing data, or to the quality or quantity of such listing data; our investment of resources to pursue strategies and develop new products and services that may not prove effective or that are not attractive for customers and real estate partners or that do not allow us to compete successfully; our ability to operate and grow the mortgage operations of Zillow Home Loans, our affiliate lender, including the ability to obtain or maintain sufficient financing 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; outcomes of legal proceedings and government investigations; our ability to attract, engage, and retain a highly skilled workforce; protection of Zillow Group’s information and systems against security breaches or disruptions in operations; reliance on third-party services to support critical functions of our business; protection of our brand and intellectual property; and changes in laws or government regulation affecting our business, among other things.
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Note 2. Summary of Significant Accounting Policies
Basis of Presentation
The accompanying condensed consolidated financial statements include Zillow Group, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. These condensed consolidated financial statements have been prepared in conformity with GAAP and applicable rules and regulations of the SEC regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these interim condensed consolidated financial statements should be read in conjunction with the audited financial statements and accompanying notes included in Zillow Group, Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024. The condensed consolidated balance sheet as of December 31, 2024, included herein, was derived from the audited financial statements of Zillow Group, Inc. as of that date. Certain reclassifications of prior period amounts have been made to conform to the current period presentation.
The unaudited condensed consolidated interim financial statements, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly our financial position as of September 30, 2025 and our results of operations, comprehensive income (loss) and shareholders’ equity for the three and nine month periods ended September 30, 2025 and 2024, and cash flows for the nine month periods ended September 30, 2025 and 2024. The results for the three and nine months ended September 30, 2025 are not necessarily indicative of the results to be expected for the year ending December 31, 2025, for any interim period, or for any other future year.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. On an ongoing basis, we evaluate our estimates, including those related to the accounting for certain revenue offerings, amortization period and recoverability of contract cost assets, website and software development costs, recoverability of long-lived assets and intangible assets, share-based compensation, income taxes, business combinations, including the initial and subsequent fair value measurements of assets (primarily intangible assets), liabilities and contingent consideration, and the recoverability of goodwill, among others. To the extent there are material differences between these estimates, judgments or assumptions and actual results, our financial statements will be affected. The health of the housing market and broader economy may result in additional uncertainty with respect to estimates, judgments and assumptions, which may materially impact the estimates previously listed, among others.
Recently Issued Accounting Standards Not Yet Adopted
In December 2023, the FASB issued guidance to enhance the income tax rate reconciliation disclosure requirements and to provide clarity on disclosure requirements for income taxes. This guidance is effective for annual periods beginning after December 15, 2024, and can be applied on a prospective or retrospective basis, with early adoption permitted. We expect to adopt this guidance for the annual period ending December 31, 2025. While we anticipate this guidance will result in additional disclosures related to income taxes, we do not expect this new guidance to have a material impact on our consolidated financial statements.
In November 2024, the FASB issued guidance that will require disclosure of specified information about certain costs and expenses included within an entity’s consolidated financial statements. This guidance is effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027, and can be applied on a prospective or retrospective basis, with early adoption permitted. We have not yet determined the impact the adoption of this guidance will have on our consolidated financial statements.
In September 2025, the FASB issued guidance that modernizes the accounting for internal-use software costs by removing all references to project development stages. Under this guidance, eligible software development costs begin capitalization once management has authorized and committed to funding the project and it is probable the project will be completed and used to perform the function intended. This guidance is effective for annual and interim periods beginning after December 15, 2027, and can be applied on a prospective, retrospective or modified basis, with early adoption permitted. We have not yet determined the impact the adoption of this guidance will have on our consolidated financial statements.
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Note 3. Financial Instruments
We apply the following methods and assumptions in estimating our fair value measurements:
Cash equivalents — The fair value measurement of money market funds is based on quoted market prices in active markets (Level 1). The fair value measurement of other cash equivalents is based on observable market-based inputs principally derived from or corroborated by observable market data (Level 2).
Short-term investments — The fair value measurement of our short-term investments is based on observable market-based inputs or inputs that are derived principally from or corroborated by observable market data by correlation or other means (Level 2).
Restricted cash — The carrying value of restricted cash approximates fair value due to the short period of time that amounts are held in escrow (Level 1).
Mortgage loans held for sale — The fair value of mortgage loans held for sale is generally calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics (Level 2).
Forward contracts — The fair value of mandatory loan sales commitments and derivative instruments such as forward sales of MBSs that are utilized as economic hedging instruments is calculated by reference to quoted prices for similar assets (Level 2).
Contingent consideration — In December 2023, Zillow Group acquired Follow Up Boss for $399 million in cash, net of cash acquired, and contingent consideration of up to $100 million, payable over a three-year period upon achievement of certain performance metrics. During the nine months ended September 30, 2025, we paid $33 million in cash to settle the first earn out payment, most of which represented settlement of the acquisition date fair value. The fair value of the contingent consideration is estimated using a Monte Carlo simulation which considers the probabilities of the achievement of certain performance metrics (Level 3).
The discount rates used in our valuation of contingent consideration are based on our estimated cost of debt and are directly related to the fair value of contingent consideration. An increase in the discount rate, in isolation, would result in a decrease in the fair value measurement. Conversely, a decrease in the discount rate, in isolation, would result in an increase in the fair value measurement. The probabilities of achieving the relevant performance metrics used in our valuation of contingent consideration are directly related to the fair value of contingent consideration, as an increase in the probability, in isolation, would result in an increase in the fair value measurement. Conversely, a decrease in the probability, in isolation, would result in a decrease in the fair value measurement.
During the three and nine months ended September 30, 2025, there were no material changes in the unobservable inputs used in determining the fair value of contingent consideration included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
IRLCs — The fair value of IRLCs is calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics. Expired commitments are excluded from the fair value measurement. Since not all IRLCs will become closed loans, we adjust our fair value measurements for the estimated amount of IRLCs that will not close. This adjustment is effected through the pull-through rate, which represents the probability that an IRLC will ultimately result in a closed loan. For IRLCs that are canceled or expire, any recorded gain or loss is reversed at the end of the commitment period (Level 3).
The pull-through rate is based on estimated changes in market conditions, loan stage and historical borrower behavior. Pull-through rates are directly related to the fair value of IRLCs as an increase in the pull-through rate, in isolation, would result in an increase in the fair value measurement. Conversely, a decrease in the pull-through rate, in isolation, would result in a decrease in the fair value measurement. Changes in the fair value of IRLCs are included within revenue in our condensed
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consolidated statements of operations. The following table presents the range and weighted-average pull-through rates used in determining the fair value of IRLCs as of the dates presented:

| September 30, 2025 |  | December 31, 2024
Range | 60% - 100% |  | 47% - 100%
Weighted-average | 82% |  | 82%

We manage our interest rate risk related to IRLCs and mortgage loans held for sale through the use of derivative instruments, generally forward contracts on MBSs, which are commitments to either purchase or sell a financial instrument at a future date for a specified price, and mandatory loan commitments, which are an obligation by an investor to buy loans at a specified price within a specified time period. We do not enter into or hold derivatives for trading or speculative purposes, and our derivatives are not designated as hedging instruments. Changes in the fair value of our derivative financial instruments are recognized in revenue in our condensed consolidated statements of operations.
The following table presents the changes in our IRLCs for the periods presented (in millions):

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Balance, beginning of the period | $ | 9 |  |  | $ | 4 |  |  | $ | 4 |  |  | $ | 3 |
Issuances | 24 |  |  | 17 |  |  | 69 |  |  | 40 |
Transfers | (24) |  |  | (15) |  |  | (64) |  |  | (37) |
Balance, end of period | $ | 9 |  |  | $ | 6 |  |  | $ | 9 |  |  | $ | 6 |

The following table presents the notional amounts of the economic hedging instruments related to our mortgage loans held for sale as of the dates presented (in millions):

| September 30, 2025 |  | December 31, 2024
IRLCs | $ | 508 |  |  | $ | 217 |
Forward contracts(1) | 654 |  |  | 300 |

(1) Represents net notional amounts. We do not have the right to offset our forward contract derivative positions.
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The following table presents the amortized cost, as applicable, and estimated fair market value of assets and liabilities measured at fair value on a recurring basis by category as of the dates presented (in millions):

| September 30, 2025 |  | December 31, 2024
| Amortized Cost |  | Estimated Fair Market Value |  | Amortized Cost |  | Estimated Fair Market Value
Assets |  |  |  |  |  |  |
Cash | $ | 20 |  |  | $ | 20 |  |  | $ | 13 |  |  | $ | 13 |
Cash equivalents: |  |  |  |  |  |  |
Money market funds | 741 |  |  | 741 |  |  | 993 |  |  | 993 |
U.S. government treasury securities | 113 |  |  | 113 |  |  | 75 |  |  | 75 |
Commercial paper | — |  |  | — |  |  | 1 |  |  | 1 |
Short-term investments: |  |  |  |  |  |  |
U.S. government treasury securities | 353 |  |  | 354 |  |  | 594 |  |  | 591 |
Corporate bonds | 152 |  |  | 153 |  |  | 175 |  |  | 176 |
U.S. government agency securities | 7 |  |  | 7 |  |  | 7 |  |  | 7 |
Certificate of deposit | 1 |  |  | 1 |  |  | — |  |  | — |
Commercial paper | — |  |  | — |  |  | 2 |  |  | 2 |
Mortgage origination-related: |  |  |  |  |  |  |
Mortgage loans held for sale | — |  |  | 291 |  |  | — |  |  | 159 |
IRLCs - other current assets | — |  |  | 9 |  |  | — |  |  | 4 |
Forward contracts - other current assets | — |  |  | 1 |  |  | — |  |  | 1 |
Restricted cash | 5 |  |  | 5 |  |  | 3 |  |  | 3 |
Total assets measured at fair value on a recurring basis | $ | 1,392 |  |  | $ | 1,695 |  |  | $ | 1,863 |  |  | $ | 2,025 |
Liabilities |  |  |  |  |  |  |
Mortgage origination-related: |  |  |  |  |  |  |
Forward contracts - accrued expenses and other current liabilities | $ | — |  |  | $ | 1 |  |  | $ | — |  |  | $ | — |
Contingent consideration: |  |  |  |  |  |  |
Contingent consideration - accrued expenses and other current liabilities | — |  |  | 32 |  |  | — |  |  | 33 |
Contingent consideration - other long-term liabilities | — |  |  | 31 |  |  | — |  |  | 58 |
Total liabilities measured at fair value on a recurring basis | $ | — |  |  | $ | 64 |  |  | $ | — |  |  | $ | 91 |

The following table presents available-for-sale investments by contractual maturity date as of September 30, 2025 (in millions):

| Amortized Cost |  | Estimated Fair Market Value
Due in one year or less | $ | 241 |  |  | $ | 241 |
Due after one year | 272 |  |  | 274 |
Total | $ | 513 |  |  | $ | 515 |

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Note 4. Property and Equipment, Net
The following table presents the detail of property and equipment, net as of the dates presented (in millions):

| September 30, 2025 |  | December 31, 2024
Website development costs | $ | 606 |  |  | $ | 564 |
Leasehold improvements | 32 |  |  | 45 |
Computer equipment | 17 |  |  | 18 |
Office equipment, furniture and fixtures | 12 |  |  | 16 |
Construction-in-progress | 3 |  |  | — |
Property and equipment | 670 |  |  | 643 |
Less: accumulated amortization and depreciation | (299) |  |  | (283) |
Property and equipment, net | $ | 371 |  |  | $ | 360 |

We recorded depreciation expense related to property and equipment (other than website development costs) of $3 million for both the three months ended September 30, 2025 and 2024, and $10 million and $11 million for the nine months ended September 30, 2025 and 2024, respectively.
We capitalized website development costs of $45 million and $46 million for the three months ended September 30, 2025 and 2024, respectively, and $144 million and $152 million for the nine months ended September 30, 2025 and 2024, respectively. Amortization expense for website development costs included in cost of revenue was $42 million and $40 million for the three months ended September 30, 2025 and 2024, respectively, and $125 million and $109 million for the nine months ended September 30, 2025 and 2024, respectively.
Note 5. Intangible Assets, Net
The following tables present the detail of intangible assets, net as of the dates presented (in millions):

| September 30, 2025
| Cost |  | Accumulated Amortization |  | Net
Customer relationships | $ | 194 |  |  | $ | (46) |  |  | $ | 148 |
Software | 115 |  |  | (46) |  |  | 69 |
Developed technology | 59 |  |  | (28) |  |  | 31 |
Trade names and trademarks | 47 |  |  | (28) |  |  | 19 |
Purchased content | 23 |  |  | (17) |  |  | 6 |
Total | $ | 438 |  |  | $ | (165) |  |  | $ | 273 |

| December 31, 2024
| Cost |  | Accumulated Amortization |  | Net
Customer relationships | $ | 94 |  |  | $ | (29) |  |  | $ | 65 |
Software | 101 |  |  | (39) |  |  | 62 |
Developed technology | 102 |  |  | (51) |  |  | 51 |
Trade names and trademarks | 47 |  |  | (25) |  |  | 22 |
Purchased content | 22 |  |  | (15) |  |  | 7 |
Total | $ | 366 |  |  | $ | (159) |  |  | $ | 207 |

On February 6, 2025, we entered into a partnership with Redfin Corporation (“Redfin”), making Zillow the exclusive provider of multifamily (properties with 25 or more units) rental listings on Redfin and its sites, including Rent.com and ApartmentGuide.com (together, “Redfin Rental Network”). Pursuant to this rentals partnership, Zillow made a $100 million payment to Redfin that is included in customer relationships in the table above and is being amortized over the estimated useful life of nine years. Zillow also pays Redfin for leads generated through the Redfin Rental Network for an initial period of five years with two optional two-year extensions, subject to the terms of the underlying agreements.
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Amortization expense recorded for intangible assets was $22 million and $20 million for the three months ended September 30, 2025 and 2024, respectively, and $64 million and $58 million for the nine months ended September 30, 2025 and 2024, respectively. We did not record any impairment costs related to intangible assets for the three or nine months ended September 30, 2025 or 2024.
Estimated future amortization expense for intangible assets, including amortization related to future commitments (see Note 11), as of September 30, 2025 is as follows (in millions):

Remainder of 2025 | $ | 20 |
2026 | 72 |
2027 | 61 |
2028 | 37 |
2029 | 29 |
Thereafter | 62 |
Total future amortization expense | $ | 281 |

Note 6. Debt
Credit Facilities
We utilize master repurchase agreements to provide capital for Zillow Home Loans. The following table summarizes certain details related to our outstanding master repurchase agreements as of the dates presented (in millions, except interest rates):

Lender |  | Maturity Date |  | Maximum Borrowing Capacity(1) |  | Outstanding Borrowings at September 30, 2025 |  | Outstanding Borrowings at December 31, 2024 |  | Weighted-Average Interest Rate at September 30, 2025
JPMorgan Chase Bank, N.A.(2) |  | April 28, 2026 |  | $ | 200 |  |  | $ | 120 |  |  | $ | 72 |  |  | 5.87 | %
UBS AG(3) |  | September 4, 2026 |  | 150 |  |  | 78 |  |  | 73 |  |  | 5.88 | %
Bank of Montreal(4) |  | February 26, 2026 |  | 150 |  |  | 74 |  |  | — |  |  | 5.85 | %
Bank of Nova Scotia(5) |  | June 8, 2026 |  | 100 |  |  | — |  |  | — |  |  | — | %
|  | Total |  | $ | 600 |  |  | $ | 272 |  |  | $ | 145 |  |  |

(1) Available borrowing capacity under our master repurchase agreements is primarily uncommitted.
(2) Agreement was amended and renewed on April 29, 2025 to increase the total maximum borrowing capacity from $150 million to $200 million and to extend the maturity date to April 28, 2026.
(3) Agreement was amended and renewed on September 5, 2025 to extend the maturity date to September 4, 2026.
(4) Agreement was entered into on February 27, 2025.
(5) Agreement was entered into on June 9, 2025.
In accordance with the master repurchase agreements, the Lenders have agreed to pay Zillow Home Loans a negotiated purchase price for eligible loans, and Zillow Home Loans has simultaneously agreed to repurchase such loans from the Lenders under a specified timeframe at an agreed upon price that includes interest. The master repurchase agreements contain margin call provisions that provide the Lenders with certain rights in the event of a decline in the market value of the assets purchased under the master repurchase agreements. As of September 30, 2025 and December 31, 2024, $284 million and $151 million, respectively, in mortgage loans held for sale were pledged as collateral under the master repurchase agreements.
Borrowings on the master repurchase agreements bear interest at a floating rate based on SOFR plus an applicable margin, as defined by the governing agreements. The master repurchase agreements include customary representations and warranties, covenants and provisions regarding events of default. As of September 30, 2025, Zillow Home Loans was in compliance with all financial covenants and no event of default had occurred. The master repurchase agreements are recourse to Zillow Home Loans and have no recourse to Zillow Group or any of its other subsidiaries.
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For additional details related to our repurchase agreements, see Note 10 in the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Convertible Senior Notes
During the nine months ended September 30, 2024 and in accordance with our Repurchase Authorizations, we repurchased $88 million aggregate principal amount of the 2025 Notes through open market transactions for $89 million in cash, including accrued interest, resulting in a loss on extinguishment of debt of $1 million recognized in our condensed consolidated statements of operations. See Note 8 for additional information on the Repurchase Authorizations.
The 2025 Notes matured on May 15, 2025, and we settled the remaining $419 million in aggregate principal amount of the 2025 Notes with cash payments totaling $425 million, which included $419 million in principal repayments, $6 million for accrued interest, and a nominal cash payment in lieu of fractional shares, and the issuance of a nominal number of shares of Class C capital stock.
Interest expense associated with our convertible senior notes was not material for the three months ended September 30, 2024 and the nine months ended September 30, 2025. The following table summarizes the interest expense related to our convertible senior notes for the nine months ended September 30, 2024 (in millions):

|  | Contractual Coupon Interest |  | Amortization of Debt Issuance Costs |  | Interest Expense
2026 Notes |  | $ | 5 |  |  | $ | 1 |  |  | $ | 6 |
2025 Notes |  | 9 |  |  | 2 |  |  | 11 |
2024 Notes |  | 3 |  |  | 1 |  |  | 4 |
Total |  | $ | 17 |  |  | $ | 4 |  |  | $ | 21 |

Settlement of Capped Call Transactions
In August 2025, we settled the capped call transactions we entered into in connection with the issuance of the 2026 Notes, resulting in the receipt of approximately 3.1 million shares of Class C capital stock and $38 million in cash. Under applicable Washington State law, the acquisition of a corporation’s own shares is not disclosed separately as treasury stock in the financial statements and such shares are treated as authorized but unissued shares. We record acquisitions of our shares of capital stock as a reduction to capital stock at the par value of the shares reacquired, then to additional paid-in capital until it is depleted to a nominal amount, with any further excess recorded to retained earnings. We recorded an offsetting increase to additional paid-in capital for the settlement of the capped call transactions.
For additional details related to our convertible senior notes and capped call transactions, see Note 10 in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Note 7. Income Taxes
On July 4, 2025, the One Big Beautiful Bill Act (the “Bill”) was enacted into law. The Bill provides for significant U.S. tax law changes and modifications and makes permanent certain key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, the expensing of domestic research costs, and the business interest expense limitation. The provisions of the Bill did not have a material impact on our condensed consolidated financial statements for the three or nine month periods ended September 30, 2025.
We are subject to income taxes in the United States (federal and state) and certain foreign jurisdictions. As of September 30, 2025 and December 31, 2024, we have provided a valuation allowance against our net deferred tax assets that we believe, based on the weight of available evidence, are not more likely than not to be realized. We have accumulated federal tax losses of approximately $1.3 billion as of December 31, 2024, which are available to reduce future taxable income. We have accumulated state tax losses of approximately $66 million (tax effected) as of December 31, 2024.
Our income tax expense or benefit for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account for the relevant period. We update our estimate of the annual effective tax rate on a quarterly basis and make year-to-date adjustments to the tax provision or benefit, as applicable. Income tax expense was not material for the three or nine month periods ended September 30, 2025 or 2024.
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Note 8. Share Repurchase Authorizations
Prior to May 2, 2025, the Board authorized the repurchase of up to $2.5 billion of our Class A common stock, Class C capital stock, convertible senior notes or a combination thereof. On May 2, 2025, the Board authorized the repurchase of up to an additional $1.0 billion of our Class A common stock, Class C capital stock, or a combination thereof, which increased our total cumulative Repurchase Authorizations to $3.5 billion. As of September 30, 2025, $943 million remained available for future repurchases of our stock pursuant to the Repurchase Authorizations.
There were no share repurchases during the three months ended September 30, 2024. The following tables summarize our Class A common stock and Class C capital stock repurchase activity under the Repurchase Authorizations for the periods presented (in millions, except share data, which are presented in thousands, and per share amounts):

| Three Months Ended September 30, 2025 |  |
| Class A common stock |  |  |  |  |  |
Shares repurchased | 457 |  |  |  |  |  |  |
Weighted-average price per share | $ | 83.51 |  |  |  |  |  |  |
Total purchase price | $ | 38 |  |  |  |  |  |  |

| Nine Months Ended September 30, 2025 |  | Nine Months Ended September 30, 2024
| Class A common stock |  | Class C capital stock |  | Class A common stock |  | Class C capital stock
Shares repurchased | 4,701 |  |  | 1,401 |  |  | 1,100 |  |  | 5,996 |
Weighted-average price per share | $ | 71.39 |  |  | $ | 73.19 |  |  | $ | 42.26 |  |  | $ | 42.45 |
Total purchase price | $ | 335 |  |  | $ | 103 |  |  | $ | 46 |  |  | $ | 255 |

Note 9. Share-Based Awards
In connection with the annual review cycle, option awards and restricted stock units are granted under the Zillow Group, Inc. 2020 Incentive Plan during the first quarter of each year and typically vest quarterly over four years. For additional information regarding our share-based awards, see Note 13 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Option Awards
The following table summarizes option award activity for the nine months ended September 30, 2025:

| Number of Shares Subject to Existing Options (in thousands) |  | Weighted- Average Exercise Price Per Share |  | Weighted- Average Remaining Contractual Life (in years) |  | Aggregate Intrinsic Value (in millions)
Outstanding at January 1, 2025 | 29,941 |  |  | $ | 46.58 |  |  | 6.3 |  | $ | 861 |
Granted | 2,299 |  |  | 76.44 |  |  |  |  |
Exercised | (4,193) |  |  | 41.74 |  |  |  |  |
Forfeited or canceled | (422) |  |  | 52.66 |  |  |  |  |
Outstanding at September 30, 2025 | 27,625 |  |  | 49.71 |  |  | 6.0 |  | 793 |
Vested and exercisable at September 30, 2025 | 20,839 |  |  | 47.32 |  |  | 5.3 |  | 656 |

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The following assumptions were used to determine the fair value of option awards granted for the periods presented:

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Expected volatility | 54% |  | 55% |  | 54% - 60% |  | 55% - 61%
Risk-free interest rate | 3.82% |  | 3.74% |  | 3.82% - 4.17% |  | 3.74% - 4.50%
Weighted-average expected life | 5.3 years |  | 5.5 years |  | 5.3 - 6.8 years |  | 5.5 - 6.8 years
Weighted-average fair value of options granted | $46.43 |  | $30.96 |  | $43.34 |  | $31.80

As of September 30, 2025, there was a total of $197 million in unrecognized compensation cost related to unvested option awards.
Restricted Stock Units
The following table summarizes activity for restricted stock units for the nine months ended September 30, 2025:

| Restricted Stock Units (in thousands) |  | Weighted-Average Grant Date Fair Value
Unvested outstanding at January 1, 2025 | 11,729 |  |  | $ | 50.31 |
Granted | 4,568 |  |  | 76.32 |
Vested | (4,551) |  |  | 51.45 |
Forfeited | (849) |  |  | 54.06 |
Unvested outstanding at September 30, 2025 | 10,897 |  |  | $ | 60.43 |

As of September 30, 2025, there was a total of $608 million in unrecognized compensation cost related to unvested restricted stock units.
Share-Based Compensation Expense
The following table presents the effects of share-based compensation expense in our condensed consolidated statements of operations during the periods presented (in millions):

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Cost of revenue | $ | 3 |  |  | $ | 3 |  |  | $ | 9 |  |  | $ | 11 |
Sales and marketing | 18 |  |  | 19 |  |  | 55 |  |  | 57 |
Technology and development | 41 |  |  | 40 |  |  | 119 |  |  | 124 |
General and administrative | 37 |  |  | 46 |  |  | 112 |  |  | 137 |
Total share-based compensation | $ | 99 |  |  | $ | 108 |  |  | $ | 295 |  |  | $ | 329 |

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Note 10. Net Income (Loss) Per Share
For the periods presented, the following table reconciles the denominators used in the basic and diluted net income (loss) per share calculations (in thousands):

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Denominator for basic calculation | 242,326 |  |  | 232,521 |  |  | 241,889 |  |  | 233,553 |
Effect of dilutive securities: |  |  |  |  |  |  |
Option awards | 10,126 |  |  | — |  |  | 9,149 |  |  | — |
Unvested restricted stock units | 3,791 |  |  | — |  |  | 3,662 |  |  | — |
Denominator for dilutive calculation | 256,243 |  |  | 232,521 |  |  | 254,700 |  |  | 233,553 |

For the periods presented, the following Class C capital stock equivalents were excluded from the calculations of diluted net income (loss) per share because their effect would have been antidilutive (in thousands):

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Weighted-average Class C capital stock option awards outstanding | 2,724 |  |  | 27,557 |  |  | 3,225 |  |  | 28,015 |
Weighted-average Class C capital stock restricted stock units outstanding | 109 |  |  | 13,567 |  |  | 1,922 |  |  | 13,705 |
Weighted-average Class C capital stock issuable upon conversion of the 2024 Notes, 2025 Notes and 2026 Notes | — |  |  | 27,276 |  |  | 3,084 |  |  | 30,826 |
Total Class C capital stock equivalents | 2,833 |  |  | 68,400 |  |  | 8,231 |  |  | 72,546 |

Note 11. Commitments and Contingencies
Purchase Commitments
Purchase commitments primarily include various non-cancelable agreements to purchase content related to our mobile applications and websites, certain cloud computing services and payments under certain partnership agreements. The amounts due for non-cancelable purchase commitments as of September 30, 2025 are as follows (in millions):

| Purchase Obligations
Remainder of 2025 | $ | 57 |
2026 | 127 |
2027 | 82 |
2028 | 16 |
2029 | 16 |
Total future purchase commitments | $ | 298 |

Legal Proceedings
We are involved in a number of legal proceedings concerning matters arising in connection with the conduct of our business activities, some of which are at preliminary stages and some of which seek an indeterminate amount of damages. We regularly evaluate the status of legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss or additional loss may have been incurred to determine if accruals are appropriate. We further evaluate each legal proceeding to assess whether an estimate of possible loss or range of loss can be made if accruals are not appropriate. For certain cases described below, management is unable to provide a meaningful estimate of the possible loss or range of possible loss because, among other reasons, (i) the proceedings are in preliminary stages; (ii) specific damages have not been sought; (iii) damages sought are, in our view, unsupported and/or exaggerated; (iv) there is uncertainty as to the outcome of pending appeals or motions; (v) there are significant factual issues to be resolved; and/or (vi) there are novel legal issues or unsettled legal theories presented. For these cases, however, management does not believe, based on currently available information, that the outcomes of these proceedings will have a material effect on our financial position, results of
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operations or cash flow. For the matters discussed below, we have not recorded any material accruals as of September 30, 2025 or December 31, 2024.
On September 17, 2019, International Business Machines Corporation (“IBM”) filed a complaint against us in the U.S. District Court for the Central District of California, alleging, among other things, that the Company has infringed and continues to willfully infringe seven patents held by IBM and seeks unspecified damages, including a request that the amount of compensatory damages be trebled, injunctive relief and costs and reasonable attorneys’ fees. Our motion to transfer venue to the U.S. District Court for the Western District of Washington (the “Court”) was granted on May 28, 2020. On November 25, 2022, Zillow filed a motion to join an Inter Partes Review (“IPR”) petition within Ebates Performance Mktg., Inc. d/b/a Rakuten Rewards v. Int’l Bus. Machs. Corp. (“Rakuten IPR”), IPR2022-00646 concerning one patent in this action, which the Court granted on April 20, 2023. On October 11, 2023, the U.S. Patent and Trial Appeal Board (“PTAB”) ruled on the Rakuten IPR finding the claims of the patent asserted against Zillow unpatentable. IBM appealed the PTAB’s decision on November 21, 2023 (the “PTAB Appeal”), and cross appeals were filed by Ebates Performance Marketing Inc. on November 21, 2023 and by us on December 15, 2023. On March 20, 2024, IBM voluntarily dismissed all claims filed in this action against Zillow with prejudice, with the exception of those pertaining to the patent asserted within the pending PTAB Appeal. On June 21, 2024 we filed our response to the PTAB Appeal. On July 30, 2024, IBM filed its reply in further support of the PTAB Appeal. On September 3, 2024, we filed our reply in further support of our cross-appeal. There is a reasonable possibility that a loss may be incurred related to this matter; however, the possible loss or range of loss is not estimable. We deny the allegations of any wrongdoing and intend to vigorously defend the claims in the lawsuit.
On November 16, 2021, November 19, 2021 and January 6, 2022, three purported class action lawsuits were filed against us and certain of our executive officers, alleging, among other things, violations of federal securities laws on behalf of a class of those who purchased our stock between August 7, 2020 and November 2, 2021. The three purported class action lawsuits, captioned Barua v. Zillow Group, Inc. et al., Silverberg v. Zillow Group, et al. and Hillier v. Zillow Group, Inc. et al. were brought in the Court and were consolidated on February 16, 2022 (the “Federal Securities Suit”). On May 12, 2022, the plaintiffs filed their amended consolidated complaint which alleges, among other things, that we issued materially false and misleading statements regarding our Zillow Offers business. The complaints seek to recover, among other things, alleged damages sustained by the purported class members as a result of the alleged misconduct. On December 7, 2022, the Court rendered its decision granting our previously filed motion to dismiss, in part, and denying the motion, in part. On January 23, 2023, we filed our answer to the consolidated complaint. On March 14, 2024, plaintiffs filed a motion for class certification, which was granted on August 23, 2024. On September 6, 2024, we filed a petition for permission to appeal the class certification order, on September 16, 2024, plaintiffs filed their opposition to our petition, and on September 23, 2024, we filed our reply in further support of the petition. On October 24, 2024, the Ninth Circuit issued an order granting Zillow permission to appeal. On January 8, 2025, we filed our opening brief in the appeal. On March 10, 2025, plaintiffs filed their response brief, and on April 30, 2025, we filed our reply brief. On November 1, 2024, the Court issued an order staying the Federal Securities Suit pending the outcome of the appeal, which was extended on October 10, 2025. On September 26, 2025, the Ninth Circuit affirmed the Court’s class certification. On October 24, 2025, we filed an en banc petition before the Ninth Circuit seeking rehearing of the Ninth Circuit’s September 26th decision. There is a reasonable possibility that a loss may be incurred related to this matter; however, the possible loss or range of loss is not estimable. We deny the allegations of any wrongdoing and intend to vigorously defend the claims in this consolidated lawsuit.
On March 10, 2022, May 5, 2022, July 20, 2022 and October 31, 2024, shareholder derivative suits were filed in the Court and on July 25, 2022, a shareholder derivative suit was filed in the Superior Court of the State of Washington, King County, against us and certain of our executive officers and directors seeking unspecified damages on behalf of the Company and certain other relief, such as reform to corporate governance practices. The plaintiffs (including the Company as a nominal defendant) allege, among other things, that the defendants breached their fiduciary duties by failing to maintain an effective system of internal controls, which purportedly caused the losses the Company incurred when it decided to wind down Zillow Offers operations. Plaintiffs also allege, among other things, violations of Section 14(a) and Section 20(a) of the Exchange Act, insider trading and waste of corporate assets. On August 23, 2023, a second shareholder derivative suit was filed in the Superior Court of the State of Washington, King County. These shareholder derivative lawsuits have since been stayed by the relevant courts and they remain stayed as of September 30, 2025. There is a reasonable possibility that a loss may be incurred related to this matter; however, the possible loss or range of loss is not estimable. The defendants deny the allegations of any wrongdoing and vigorously defend the claims in these lawsuits.
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On September 30, 2025, the Federal Trade Commission filed a complaint in the U.S. District Court for the Eastern District of Virginia against Zillow Group, Inc., Zillow, Inc., and Redfin Corporation. On October 1, 2025, the Attorneys General of the Commonwealth of Virginia and the States of Arizona, Connecticut, New York, and Washington filed a similar complaint against the same parties in the same court. The complaints allege that the partnership entered into between Zillow and Redfin on February 6, 2025, harmed competition for online multifamily rental-listings in violation of federal antitrust laws. The plaintiffs seek injunctive and other equitable relief. We deny the allegations of any wrongdoing and intend to vigorously defend the claims in these lawsuits.
In addition to the matters discussed above, from time to time, we are involved in litigation and claims that arise in the ordinary course of business. Although we cannot be certain of the outcome of any such litigation or claims, nor the amount of damages and exposure that we could incur, we currently believe that the final disposition of such matters will not have a material effect on our business, financial position, results of operations or cash flow. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.
Indemnifications
In the ordinary course of business, we enter into contractual arrangements under which we agree to provide indemnification of varying scope and terms to business partners and other parties with respect to certain matters. For additional information regarding our indemnifications, see Note 15 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Note 12. Revenue and Contract Balances
We recognize revenue when or as we satisfy our performance obligations by transferring control of the promised products or services to our customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those products or services. See Note 2 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 for additional information on our revenue from contracts with customers and contract balances.
Contract Balances
Contract assets totaled $214 million and $157 million as of September 30, 2025 and December 31, 2024, respectively. As of September 30, 2025, the average remaining recognition period for our contract asset related to our Premier Agent Flex offering was five months.
For the three months ended September 30, 2025, the opening balance of deferred revenue was $70 million, of which $55 million was recognized as revenue during the period. For the three months ended September 30, 2024, the opening balance of deferred revenue was $59 million, of which $51 million was recognized as revenue during the period.
For the nine months ended September 30, 2025, the opening balance of deferred revenue was $62 million, of which $57 million was recognized as revenue during the period. For the nine months ended September 30, 2024, the opening balance of deferred revenue was $52 million, of which $50 million was recognized as revenue during the period.
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Note 13. Segment Information
Significant Segment Expenses
The following table presents our significant expense categories included in our reported measure of segment profitability for the periods presented (in millions):

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Revenue | $ | 676 |  |  | $ | 581 |  |  | $ | 1,929 |  |  | $ | 1,682 |
Less: |  |  |  |  |  |  |
Headcount-related expenses, excluding share-based compensation | 300 |  |  | 281 |  |  | 886 |  |  | 817 |
Share-based compensation | 99 |  |  | 108 |  |  | 295 |  |  | 329 |
Depreciation and amortization | 67 |  |  | 63 |  |  | 199 |  |  | 178 |
Marketing and advertising costs | 47 |  |  | 64 |  |  | 154 |  |  | 152 |
Direct product and service costs | 91 |  |  | 48 |  |  | 214 |  |  | 135 |
Third-party professional service fees | 25 |  |  | 14 |  |  | 61 |  |  | 54 |
Facility expenses | 6 |  |  | 5 |  |  | 20 |  |  | 22 |
Impairment costs | 2 |  |  | — |  |  | 2 |  |  | 6 |
Acquisition-related costs | — |  |  | 1 |  |  | — |  |  | 1 |
Other items (1) | 42 |  |  | 42 |  |  | 121 |  |  | 116 |
Loss from operations | (3) |  |  | (45) |  |  | (23) |  |  | (128) |
Loss on extinguishment of debt | — |  |  | — |  |  | — |  |  | (1) |
Other income, net | 18 |  |  | 34 |  |  | 58 |  |  | 101 |
Interest expense | (3) |  |  | (9) |  |  | (13) |  |  | (28) |
Income tax expense | (2) |  |  | — |  |  | (2) |  |  | (4) |
Net income (loss) | $ | 10 |  |  | $ | (20) |  |  | $ | 20 |  |  | $ | (60) |

(1) Other items include software and hardware, taxes, insurance, and data acquisition costs.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q. In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results may differ materially from those described in or implied by any forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report on Form 10-Q, including in Part II, Item 1A (Risk Factors) and in the section titled “Note Regarding Forward-Looking Statements,” and those factors discussed in Part I, Item 1A (Risk Factors) of our Annual Report on Form 10-K for the year ended December 31, 2024.
Overview of our Business
Zillow Group 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 and its affiliates help people find and get the home they want by connecting them with digital solutions, dedicated real estate professionals, and easier buying, selling, financing and renting experiences.
Our portfolio of affiliates, subsidiaries and brands includes Zillow Premier Agent, Zillow Home Loans, our mortgage origination operations and affiliate lender, Zillow Rentals, Trulia, StreetEasy, HotPads and Out East. In addition, Zillow Group provides a comprehensive suite of marketing software and technology solutions for the real estate industry, including ShowingTime+, Spruce and Follow Up Boss.
As of September 30, 2025, we had 7,031 employees, compared to 6,856 employees as of December 31, 2024.
Health of Housing Market
Our financial performance is impacted by changes in the health of the housing market, which is impacted, in turn, by general economic conditions. Current market factors have been driven by low housing inventory, elevated and volatile mortgage interest rates, changes in rental inventory and occupancy rates, as well as home price fluctuations and inflationary conditions. These factors may impact the number of transactions consumers complete using our products and services and demand for our advertising services. According to residential real estate data collected and estimated by Zillow Group as published monthly on our site, TTV increased 6% during the three months ended September 30, 2025 as compared to the three months ended September 30, 2024 and increased 5% during the nine months ended September 30, 2025 as compared to the nine months ended September 30, 2024. We continue to invest in the growth of our business, which we believe has resulted in year over year total revenue results, described below, for the three and nine month periods ended September 30, 2025 as compared to the same periods in the prior year, that exceeded industry performance for the same periods. The extent to which market factors impact our results and financial position will depend on future developments, which are uncertain and difficult to predict.
Revenue Overview
Our revenue is classified into four categories: Residential, Mortgages, Rentals and Other. Our “For Sale revenue” subtotal includes our Residential and Mortgages revenue categories and represents our revenue from participation in residential real estate purchase and sale transactions.
Residential. Residential revenue includes revenue generated by our Premier Agent and new construction marketplaces, as well as revenue from the sale of advertising and business technology solutions for real estate professionals through ShowingTime+, StreetEasy for-sale product offerings and Follow Up Boss.
Premier Agent revenue is generated by the sale of advertising services, as well as marketing and technology products and services, to help real estate agents and brokers grow and manage their businesses and brands. We offer these products and services through our Premier Agent program. Premier Agent products, which include the delivery of validated customer connections, or leads, are offered on a share of voice (“market-based pricing”) and pay for performance (“Flex”) basis. For our market-based pricing offering, connections are distributed to Premier Agent partners in proportion to their share of voice, or a Premier Agent partner’s share of total advertising purchased in a particular zip code. With the Flex model, Premier Agent partners are provided with leads at no initial cost and pay a performance advertising fee only when a real estate transaction is closed with one of the leads, generally within two years.
New construction revenue primarily includes advertising services sold to home builders on a cost per residential community or cost per impression basis.
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Revenue generated through ShowingTime+ includes ShowingTime revenue, which is primarily generated by Appointment Center, a software-as-a-service and call center solution allowing real estate agents, brokerages and MLSs to efficiently schedule real estate viewing appointments on behalf of their customers. Appointment Center services also include call center specialists who provide scheduling support to customers. ShowingTime+ revenue also includes our dotloop real estate transaction management software-as-a-service solution, as well as Zillow Showcase, a listing marketing package.
StreetEasy for-sale revenue primarily consists of our StreetEasy Experts and StreetEasy subscription offerings. StreetEasy Experts is our pay for performance pricing model available in the New York City market for which agents and brokers are provided with leads at no initial cost and pay a performance referral fee only when a real estate purchase transaction is closed with one of the leads. Revenue generated through StreetEasy subscription offerings includes the sale of advertising and a suite of tools to developers, property managers, agents and other market professionals.
Follow Up Boss revenue primarily consists of our software-as-a-service customer relationship management system which provides real estate agents, teams and brokerages with a central hub to manage real estate transactions from connection to close.
Mortgages. Mortgages revenue primarily includes revenue generated through mortgage originations and the related sale of mortgages on the secondary market through Zillow Home Loans and revenue from advertising sold to mortgage lenders and other mortgage professionals on a cost-per-lead basis, including our Custom Quote and Connect services.
Rentals. Rentals revenue includes advertising and a suite of tools sold to property managers on a cost-per-lead, lease, listing or impression basis or for a fixed fee for certain advertising packages through both the Zillow and StreetEasy brands. Rentals revenue also includes revenue generated from our rental applications product, through which potential renters can submit applications to multiple properties for a flat service fee.
Other. Other revenue includes revenue generated primarily by display advertising.
For additional information on our revenue categories, see Note 2 in our Notes to Consolidated Financial Statements in Part II, Item 8 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Financial Overview
For the three months ended September 30, 2025 and 2024, we generated total revenue of $676 million and $581 million, respectively, an increase of 16%. The increase in total revenue was primarily attributable to the following:
Rentals Revenue
•Rentals revenue increased by $51 million, or 41%, to $174 million, due to increases in quarterly revenue per average monthly rentals unique visitor.
For Sale Revenue
•Residential revenue increased by $30 million, or 7%, to $435 million, due to increases in the number of visits and in Residential revenue per visit.
•Mortgages revenue increased by $14 million, or 36%, to $53 million, driven by an increase in mortgage originations revenue as a result of increased total loan origination volume.
During the three months ended September 30, 2025 and 2024, we generated gross profit of $491 million and $441 million, respectively, an increase of 11%.
Key Metrics
Management has identified visits, unique users, For Sale revenue per TTV, and the volume of loans originated through Zillow Home Loans as relevant to investors’ and others’ assessment of our financial condition and results of operations.
Visits
The number of visits is an important metric because it is an indicator of consumers’ level of engagement with our mobile applications, websites and other services. We believe highly engaged consumers are more likely to use our products and services, including Zillow Homes Loans, or be transaction-ready real estate market participants and therefore more sought-after by our Premier Agent partners.
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We define a visit as a group of interactions by users with our Zillow, Trulia and StreetEasy mobile applications and websites. A single visit can contain multiple page views and actions, and a single user can open multiple visits across domains, web browsers, desktop or mobile devices. Visits can occur on the same day, or over several days, weeks or months.
Zillow and StreetEasy measure visits using an internal measurement tool, and Trulia measures visits with Adobe Analytics. Visits to Trulia end after thirty minutes of user inactivity. Visits to Zillow and StreetEasy end after thirty minutes of user inactivity or at midnight. From January 1, 2024 through June 30, 2024, we measured visits to StreetEasy using Google’s Universal Analytics. Since July 1, 2024, we have measured visits to StreetEasy using an internal measurement tool. Through Universal Analytics, visits to StreetEasy ended either: (i) after thirty minutes of user inactivity or at midnight; or (ii) through a campaign change. A visit ends through a campaign change if a visitor arrived via one campaign or source (for example, via a search engine or referring link on a third-party website), left the mobile application or website, and then returned via another campaign or source.
We believe that using an internal measurement tool to measure visits to Zillow and StreetEasy allows us to maintain control over and provide greater insight into our end-to-end data as we enhance our broader long-term analytics strategy, while also becoming less reliant on third-party providers.
The following table presents the number of visits to our mobile applications and websites for the periods presented (in millions, except percentages):

| Three Months Ended September 30, |  | 2024 to 2025 % Change |  | Nine Months Ended September 30, |  | 2024 to 2025 % Change
| 2025 |  | 2024 |  |  | 2025 |  | 2024 |
Visits | 2,546 |  |  | 2,440 |  | 4 | % |  | 7,490 |  | 7,251 |  | 3 | %

Unique Users
Measuring unique users is important to us because much of our revenue depends in part on our ability to connect home buyers and sellers, renters and individuals with or looking for a mortgage to real estate, rental and mortgage professionals, products and services. Growth in consumer traffic to our mobile applications and websites increases the number of impressions, clicks, connections, leads and other events we can monetize to generate revenue. For example, our revenue depends in part, on users accessing our mobile applications and websites to engage in the sale, purchase, renting and financing of homes, including with Zillow Home Loans, and a significant portion of our Residential revenue, Rentals revenue and Other revenue depends on advertisements being served to users of our mobile applications and websites.
We count a unique user the first time an individual accesses one of our mobile applications 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 applications 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 more than one of our mobile applications within a given month, the first access to each mobile application 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. If an individual accesses more than one of our websites in a single month, the first access to each website is counted as a separate unique user since unique users are tracked separately for each domain.
Zillow, StreetEasy, and HotPads measure unique users using an internal measurement tool, and Trulia measures unique users with Adobe Analytics. From January 1, 2024 through June 30, 2024, we measured unique users for StreetEasy and HotPads using Google’s Universal Analytics. Since July 1, 2024, we have measured unique users for StreetEasy and HotPads using an internal measurement tool.
Due to technological limitations, user software settings, or user behavior, our internal measurement tool and Universal Analytics may assign a unique cookie to different instances of access by the same individual to our mobile applications and websites. In such instances, although these tools capture the number of unique users in accordance with the defined methodology, there are inherent limitations in measuring the number of unique individuals accessing our mobile applications and websites.
We believe that using an internal measurement tool to measure unique users of Zillow, StreetEasy and HotPads allows us to maintain control over and provide greater insight into our end-to-end data as we enhance our broader long-term analytics strategy, while also becoming less reliant on third-party providers.
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The following table presents our average monthly unique users for the periods presented (in millions, except percentages):

| Three Months Ended September 30, |  | 2024 to 2025 % Change |  | Nine Months Ended September 30, |  | 2024 to 2025 % Change
| 2025 |  | 2024 |  |  | 2025 |  | 2024 |
Average monthly unique users | 250 |  | 233 |  | 7 | % |  | 240 |  | 227 |  | 6 | %

For Sale Revenue Per Total Transaction Value
For Sale revenue per TTV is an important metric because it is an indicator of our For Sale revenue performance relative to the residential real estate industry. To evaluate how our investments drive performance relative to industry growth, we use this metric to measure our ability to both connect and convert more buyers and sellers to transact with us and to grow revenue per customer transaction.
We calculate For Sale revenue per TTV as total For Sale revenue for the relevant period divided by the aggregate TTV for the same period. TTV is calculated as the number of existing residential homes sold during the relevant period multiplied by the average sales price of existing residential homes sold during the same period according to residential real estate data collected and estimated by Zillow Group, as published monthly on our site. For Sale revenue and TTV have historically been affected by seasonal fluctuations in the residential real estate market. We generally expect For Sale revenue to peak during the three months ending June 30 or September 30. As such, we measure performance and present our For Sale revenue per TTV on a trailing twelve-month basis to account for seasonality.
The following table presents our For Sale revenue per TTV for the periods presented:

| Twelve Months Ended September 30, |  | 2024 to 2025 % Change
| 2025 |  | 2024 |
For Sale revenue (in millions) | $ | 1,856 |  |  | $ | 1,682 |  |  | 10 | %
Total Transaction Value (in trillions) (1) | $ | 1.8 |  |  | $ | 1.7 |  |  | 7 | %
For Sale revenue per Total Transaction Value (in basis points) | 10.1 |  | 9.8 |  | 3 | %

(1) Estimate for the twelve months ended September 30, 2025 is as of October 2025.
Loan Origination Volume
Loan origination volume is an important metric as it is a measure of how successful we are at the origination of mortgage loan products through our Zillow Home Loans mortgage origination operations, which directly impacts our Mortgages revenue. Loan origination volume represents the total value of mortgage loan originations closed through Zillow Home Loans during the period.
The following table presents loan origination volume by purpose and in total for Zillow Home Loans for the periods presented (in millions, except percentages):

| Three Months Ended September 30, |  | 2024 to 2025 % Change |  | Nine Months Ended September 30, |  | 2024 to 2025 % Change
| 2025 |  | 2024 |  |  | 2025 |  | 2024 |
Purchase loan origination volume | $ | 1,276 |  |  | $ | 812 |  |  | 57 | % |  | $ | 3,183 |  |  | $ | 2,169 |  |  | 47 | %
Refinance loan origination volume | 5 |  |  | 7 |  |  | (29) | % |  | 20 |  |  | 14 |  |  | 43 | %
Total loan origination volume | $ | 1,281 |  |  | $ | 819 |  |  | 56 | % |  | $ | 3,203 |  |  | $ | 2,183 |  |  | 47 | %

During the three and nine months ended September 30, 2025, total loan origination volume increased 56% and 47%, respectively, compared to the three and nine months ended September 30, 2024. This increase was primarily driven by the continued growth in Zillow Home Loans purchase loan originations in line with our strategic priorities.
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Results of Operations
Given continued uncertainty surrounding the health of the housing market, interest rate environment and inflationary conditions, financial performance for current and prior periods may not be indicative of future performance.
Revenue

|  |  |  |  |  |  |  |  | % of Total Revenue
| Three Months Ended September 30, |  | 2024 to 2025 |  | Three Months Ended September 30,
| 2025 |  | 2024 |  | $ Change |  | % Change |  | 2025 |  | 2024
| (in millions, except percentages, unaudited)
Revenue: |  |  |  |  |  |  |  |  |  |  |
For Sale revenue: |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 435 |  |  | $ | 405 |  |  | $ | 30 |  |  | 7 | % |  | 64 | % |  | 70 | %
Mortgages | 53 |  |  | 39 |  |  | 14 |  |  | 36 |  |  | 8 |  |  | 7 |
Total For Sale revenue | 488 |  |  | 444 |  |  | 44 |  |  | 10 |  |  | 72 |  |  | 76 |
Rentals | 174 |  |  | 123 |  |  | 51 |  |  | 41 |  |  | 26 |  |  | 21 |
Other | 14 |  |  | 14 |  |  | — |  |  | — |  |  | 2 |  |  | 2 |
Total revenue | $ | 676 |  |  | $ | 581 |  |  | $ | 95 |  |  | 16 | % |  | 100 | % |  | 100 | %

|  |  |  |  |  |  |  |  | % of Total Revenue
| Nine Months Ended September 30, |  | 2024 to 2025 |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | $ Change |  | % Change |  | 2025 |  | 2024
| (in millions, except percentages, unaudited)
Revenue: |  |  |  |  |  |  |  |  |  |  |
For Sale revenue: |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 1,286 |  |  | $ | 1,207 |  |  | $ | 79 |  |  | 7 | % |  | 67 | % |  | 72 | %
Mortgages | 142 |  |  | 104 |  |  | 38 |  |  | 37 |  |  | 7 |  |  | 6 |
Total For Sale revenue | 1,428 |  |  | 1,311 |  |  | 117 |  |  | 9 |  |  | 74 |  |  | 78 |
Rentals | 462 |  |  | 337 |  |  | 125 |  |  | 37 |  |  | 24 |  |  | 20 |
Other | 39 |  |  | 34 |  |  | 5 |  |  | 15 |  |  | 2 |  |  | 2 |
Total revenue | $ | 1,929 |  |  | $ | 1,682 |  |  | $ | 247 |  |  | 15 | % |  | 100 | % |  | 100 | %

Three Months Ended September 30, 2025 compared to Three Months Ended September 30, 2024
Total revenue increased $95 million, or 16%, to $676 million:
Rentals Revenue
•Rentals revenue increased $51 million, or 41%, driven by a 46% increase in quarterly revenue per average monthly rentals unique visitor to $4.97 for the three months ended September 30, 2025 from $3.42 for the three months ended September 30, 2024. The increase in quarterly revenue per average monthly rentals unique visitor was driven by a 62% increase in multifamily rentals revenue due to growth in multifamily property listings and in revenue per property as property managers upgraded to more comprehensive advertising packages. We calculate quarterly revenue per average monthly rentals unique visitor by dividing total Rentals revenue for the period by the average monthly rentals unique visitors for the period and then dividing by the number of quarters in the period. Average monthly rentals unique visitors decreased 3% to 35 million during the three months ended September 30, 2025 from 36 million during the three months ended September 30, 2024. We have estimated average monthly rentals unique visitors using Comscore data, which measures average monthly unique visitors on rental listings on Zillow, Trulia and HotPads mobile apps and websites, and on Realtor.com and Redfin and its sites, including Rent.com and ApartmentGuide.com.
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For Sale Revenue
•Residential revenue increased $30 million, or 7%. The increase in Residential revenue was partially driven by a 4% increase in the number of visits to 2.5 billion for the three months ended September 30, 2025 from 2.4 billion for the three months ended September 30, 2024. Residential revenue was also positively impacted by an increase in Residential revenue per visit to $0.171 for the three months ended September 30, 2025 from $0.166 for the three months ended September 30, 2024, primarily due to growth in our Premier Agent revenue driven by continued improvement in our ability to connect high-intent customers to agents, an increase in ShowingTime+ revenue driven by increasing adoption of our software services by sellers and listing agents, and continued growth in new construction revenue. We calculate Residential revenue per visit by dividing the revenue generated by our Residential offerings by the number of visits in the period. We expect Residential revenue to decrease in absolute dollars during the three months ending December 31, 2025, primarily due to the impact of seasonality on the residential real estate market.
•Mortgages revenue increased $14 million, or 36%, driven by a $14 million increase in mortgage originations revenue. The increase in mortgage originations revenue was primarily due to a 56% increase in total loan origination volume to $1.3 billion for the three months ended September 30, 2025 from $819 million for the three months ended September 30, 2024, primarily driven by continued growth in Zillow Home Loans purchase loan origination volume. The increase in mortgage originations revenue was partially offset by a 6% decrease in gain on sale margin. Gain on sale margin represents the net gain on sale of mortgage loans divided by total loan origination volume for the period. Net gain on sale of mortgage loans includes all components related to the origination and sale of mortgage loans, including the net gain on sale of loans into the secondary market, loan origination fees, unrealized gains and losses associated with changes in fair value of IRLCs and mortgage loans held for sale, realized and unrealized gains or losses from derivative financial instruments and the provision for losses relating to representations and warranties.
Nine Months Ended September 30, 2025 compared to Nine Months Ended September 30, 2024
Total revenue increased $247 million, or 15%, to $1.9 billion:
Rentals Revenue
•Rentals revenue increased $125 million, or 37%, driven by a 25% increase in quarterly revenue per average monthly rentals unique visitor to $4.53 for the nine months ended September 30, 2025 as compared to $3.62 for the nine months ended September 30, 2024. The increase in quarterly revenue per average monthly rentals unique visitor was driven by a 56% increase in multifamily rentals revenue due to growth in multifamily property listings and in revenue per property as property managers upgraded to more comprehensive advertising packages. The increase in Rentals revenue was also driven by growth in average monthly rentals unique visitors, which increased 10% to 34 million during the nine months ended September 30, 2025 from 31 million during the nine months ended September 30, 2024.
For Sale Revenue
•Residential revenue increased $79 million, or 7%. The increase in Residential revenue was partially driven by a 3% increase in the number of visits to 7.5 billion for the nine months ended September 30, 2025 from 7.3 billion for the nine months ended September 30, 2024. Residential revenue was also positively impacted by a 3% increase in Residential revenue per visit to $0.172 for the nine months ended September 30, 2025 from $0.166 for the nine months ended September 30, 2024, primarily due to growth in our Premier Agent revenue driven by continued improvement in our ability to connect high-intent customers to agents, an increase in ShowingTime+ revenue driven by increasing adoption of our software services by sellers and listing agents, and continued growth in new construction revenue.
•Mortgages revenue increased $38 million, or 37%. This increase was driven by a $38 million increase in mortgage originations revenue. The increase in mortgage originations revenue was primarily due to a 47% increase in total loan origination volume to $3.2 billion for the nine months ended September 30, 2025 from $2.2 billion for the nine months ended September 30, 2024, primarily driven by continued growth in Zillow Home Loans purchase loan origination volume. The increase in mortgage originations revenue was also attributable to an 2% increase in gain on sale margin.
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Adjusted EBITDA
The following tables summarize net income (loss) and Adjusted EBITDA for each of the periods presented (in millions, except percentages):

|  |  |  |  |  |  |  |  | % of Revenue
| Three Months Ended September 30, |  | 2024 to 2025 |  | Three Months Ended September 30,
| 2025 |  | 2024 |  | $ Change |  | % Change |  | 2025 |  | 2024
Net income (loss) | $ | 10 |  |  | $ | (20) |  |  | $ | 30 |  |  | 150 | % |  | 1 | % |  | (3) | %
Adjusted EBITDA | $ | 165 |  |  | $ | 127 |  |  | $ | 38 |  |  | 30 | % |  | 24 | % |  | 22 | %

|  |  |  |  |  |  |  |  | % of Revenue
| Nine Months Ended September 30, |  | 2024 to 2025 |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | $ Change |  | % Change |  | 2025 |  | 2024
Net income (loss) | $ | 20 |  |  | $ | (60) |  |  | $ | 80 |  |  | 133 | % |  | 1 | % |  | (4) | %
Adjusted EBITDA | $ | 473 |  |  | $ | 386 |  |  | $ | 87 |  |  | 23 | % |  | 25 | % |  | 23 | %

To provide investors with additional information regarding our financial results, we have disclosed Adjusted EBITDA, a non-GAAP financial measure, in this Quarterly Report on Form 10-Q. We have provided a reconciliation below of Adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measure.
We have included Adjusted EBITDA in this Quarterly Report on Form 10-Q as it is a key metric used by our management and Board 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 impairment costs;
•Adjusted EBITDA does not reflect acquisition-related costs;
•Adjusted EBITDA does not reflect loss on extinguishment of debt;
•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 (loss) and our other GAAP results.
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The following table presents a reconciliation of Adjusted EBITDA to net income (loss) for each of the periods presented (in millions, unaudited):

| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Net income (loss) | $ | 10 |  |  | $ | (20) |  |  | $ | 20 |  |  | $ | (60) |
Income taxes | 2 |  |  | — |  |  | 2 |  |  | 4 |
Other income, net | (18) |  |  | (34) |  |  | (58) |  |  | (101) |
Depreciation and amortization | 67 |  |  | 63 |  |  | 199 |  |  | 178 |
Share-based compensation | 99 |  |  | 108 |  |  | 295 |  |  | 329 |
Impairment costs | 2 |  |  | — |  |  | 2 |  |  | 6 |
Acquisition-related costs | — |  |  | 1 |  |  | — |  |  | 1 |
Loss on extinguishment of debt | — |  |  | — |  |  | — |  |  | 1 |
Interest expense | 3 |  |  | 9 |  |  | 13 |  |  | 28 |
Adjusted EBITDA | $ | 165 |  |  | $ | 127 |  |  | $ | 473 |  |  | $ | 386 |

Costs and Expenses, Gross Profit and Other Items

|  |  |  |  |  |  |  |  | % of Total Revenue
| Three Months Ended September 30, |  | 2024 to 2025 |  | Three Months Ended September 30,
| 2025 |  | 2024 |  | $ Change |  | % Change |  | 2025 |  | 2024
| (in millions, except percentages, unaudited)
Cost of revenue | $ | 185 |  |  | $ | 140 |  |  | $ | 45 |  |  | 32 | % |  | 27 | % |  | 24 | %
Gross profit | 491 |  |  | 441 |  |  | 50 |  |  | 11 |  |  | 73 |  |  | 76 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |
Sales and marketing | 214 |  |  | 217 |  |  | (3) |  |  | (1) |  |  | 32 |  |  | 37 |
Technology and development | 151 |  |  | 145 |  |  | 6 |  |  | 4 |  |  | 22 |  |  | 25 |
General and administrative | 127 |  |  | 123 |  |  | 4 |  |  | 3 |  |  | 19 |  |  | 21 |
Impairment costs | 2 |  |  | — |  |  | 2 |  |  | — |  |  | — |  |  | — |
Acquisition-related costs | — |  |  | 1 |  |  | (1) |  |  | (100) |  |  | — |  |  | — |
Total operating expenses | 494 |  |  | 486 |  |  | 8 |  |  | 2 |  |  | 73 |  |  | 84 |
Other income, net | 18 |  |  | 34 |  |  | (16) |  |  | (47) |  |  | 3 |  |  | 6 |
Interest expense | 3 |  |  | 9 |  |  | (6) |  |  | (67) |  |  | — |  |  | 2 |
Income tax expense | 2 |  |  | — |  |  | 2 |  |  | — |  |  | — |  |  | — |

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|  |  |  |  |  |  |  |  | % of Total Revenue
| Nine Months Ended September 30, |  | 2024 to 2025 |  | Nine Months Ended September 30,
| 2025 |  | 2024 |  | $ Change |  | % Change |  | 2025 |  | 2024
| (in millions, except percentages, unaudited)
Cost of revenue | $ | 490 |  |  | $ | 393 |  |  | $ | 97 |  |  | 25 | % |  | 25 | % |  | 23 | %
Gross profit | 1,439 |  |  | 1,289 |  |  | 150 |  |  | 12 |  |  | 75 |  |  | 77 |
Operating expenses: |  |  |  |  |  |  |  |  |  |  |
Sales and marketing | 638 |  |  | 588 |  |  | 50 |  |  | 9 |  |  | 33 |  |  | 35 |
Technology and development | 453 |  |  | 436 |  |  | 17 |  |  | 4 |  |  | 23 |  |  | 26 |
General and administrative | 369 |  |  | 386 |  |  | (17) |  |  | (4) |  |  | 19 |  |  | 23 |
Impairment costs | 2 |  |  | 6 |  |  | (4) |  |  | (67) |  |  | — |  |  | — |
Acquisition-related costs | — |  |  | 1 |  |  | (1) |  |  | (100) |  |  | — |  |  | — |
Total operating expenses | 1,462 |  |  | 1,417 |  |  | 45 |  |  | 3 |  |  | 76 |  |  | 84 |
Loss on extinguishment of debt | — |  |  | 1 |  |  | (1) |  |  | (100) |  |  | — |  |  | — |
Other income, net | 58 |  |  | 101 |  |  | (43) |  |  | (43) |  |  | 3 |  |  | 6 |
Interest expense | 13 |  |  | 28 |  |  | (15) |  |  | (54) |  |  | 1 |  |  | 2 |
Income tax expense | 2 |  |  | 4 |  |  | (2) |  |  | (50) |  |  | — |  |  | — |

Cost of Revenue
Cost of revenue consists of expenses related to operating our mobile applications and websites, including associated headcount-related expenses, such as salaries, benefits, bonuses and share-based compensation expense, as well as revenue-sharing costs related to our commercial business relationships, depreciation expense, and costs associated with hosting our mobile applications and websites. Cost of revenue also includes amortization costs related to capitalized website and development activities, amortization of software, amortization of certain intangible assets and other costs to obtain data used to populate our mobile applications and websites, and amortization of certain intangible assets recorded in connection with acquisitions, including developed technology. Cost of revenue also includes credit card fees and ad serving costs paid to third parties, direct costs to provide our rental applications product, and direct costs to originate mortgage loans, including underwriting and processing costs.
Three Months Ended September 30, 2025 compared to Three Months Ended September 30, 2024
Cost of revenue increased $45 million, or 32%, primarily driven by increases of $33 million in lead acquisition costs, primarily associated with our rentals partnership with Redfin, $8 million in ad serving costs to support the growth of our rentals marketplace, and $3 million in depreciation and amortization expense primarily due to an increase in amortization of website development costs.
Nine Months Ended September 30, 2025 compared to Nine Months Ended September 30, 2024
Cost of revenue increased $97 million, or 25%, due to increases of $58 million in lead acquisition costs, primarily associated with our rentals partnership with Redfin, $17 million in depreciation and amortization expense primarily due to an increase in amortization of website development costs, $14 million in ad serving costs to support the growth of our rentals marketplace, $4 million in headcount-related expenses, including share-based compensation expense, as we continue to invest in human capital to grow our business, and $4 million in software and hardware costs.

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Gross Profit
Gross profit is calculated as revenue less cost of revenue. Gross margin is gross profit expressed as a percentage of revenue. Our gross profit has and will continue to be affected by a number of factors, including the mix of revenue from our various product offerings.
Three Months Ended September 30, 2025 compared to Three Months Ended September 30, 2024
Gross profit increased by $50 million, or 11%, primarily due to an increase in revenue, discussed above. Total gross margin decreased from 76% to 73%, primarily due to increased lead acquisition costs associated with our rentals partnership with Redfin.
Nine Months Ended September 30, 2025 compared to Nine Months Ended September 30, 2024
Gross profit increased by $150 million, or 12%, primarily due to an increase in revenue, discussed above. Total gross margin decreased from 77% to 75%, primarily due to increased lead acquisition costs associated with our rentals partnership with Redfin.
Sales and Marketing
Sales and marketing expenses consist of advertising costs and other sales expenses related to promotional and marketing activities, headcount-related expenses, including salaries, commissions, benefits, bonuses and share-based compensation expense for sales, sales support, customer support, including the customer connections team and mortgage loan officers and specialists, marketing and public relations employees, depreciation expense and amortization of certain acquired intangible assets, including trade names and trademarks and customer relationships.
Three Months Ended September 30, 2025 compared to Three Months Ended September 30, 2024
Sales and marketing expenses decreased $3 million, or 1%, due to a decrease of $18 million in marketing and advertising costs primarily driven by the timing of our rentals advertising campaigns. This decrease was partially offset by a $10 million increase in headcount-related expenses, including share-based compensation expense, as we continue to invest in human capital to grow our business, and a $2 million increase in depreciation and amortization expense.
Nine Months Ended September 30, 2025 compared to Nine Months Ended September 30, 2024
Sales and marketing expenses increased $50 million, or 9%, due to increases of $38 million in headcount-related expenses, including share-based compensation expense, as we continue to invest in human capital to grow our business and $5 million in depreciation and amortization expense.
Technology and Development
Technology and development expenses consist of headcount-related expenses, including salaries, benefits, bonuses and share-based compensation expense for individuals engaged in the design, development and testing of our products, mobile applications and websites and the tools and applications that support our products. Technology and development expenses also include equipment and software maintenance costs and depreciation expense.
Three Months Ended September 30, 2025 compared to Three Months Ended September 30, 2024
Technology and development expenses increased $6 million, or 4%, primarily due to an increase of $4 million in headcount-related expenses, including share-based compensation expense, as we continue to invest in human capital to grow our business.
Nine Months Ended September 30, 2025 compared to Nine Months Ended September 30, 2024
Technology and development expenses increased $17 million, or 4%, due to increases of $10 million in headcount-related expenses, including share-based compensation expense, as we continue to invest in human capital to grow our business, and $5 million in software and hardware costs.
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General and Administrative
General and administrative expenses consist of headcount-related expenses, including salaries, benefits, bonuses and share-based compensation expense for executive, finance, accounting, legal, human resources, recruiting, corporate information technology costs and other administrative support. General and administrative expenses also include legal settlement costs and estimated legal liabilities, legal, accounting and other third-party professional service fees, rent expense, depreciation expense, change in the fair value of contingent consideration, and bad debt expense.
Three Months Ended September 30, 2025 compared to Three Months Ended September 30, 2024
General and administrative expenses increased $4 million, or 3%, due to increases of $9 million in third-party professional service fees, including legal expenses, and $2 million in software and hardware costs. These increases were partially offset by decreases of $8 million in headcount-related expenses, including share-based compensation expense, driven primarily by equity award actions that occurred in August 2022 and impacted the three months ended September 30, 2024.
Nine Months Ended September 30, 2025 compared to Nine Months Ended September 30, 2024
General and administrative expenses decreased $17 million, or 4%, primarily due to decreases of $21 million in headcount-related expenses, including share-based compensation expense, driven primarily by equity award actions that occurred in August 2022 and impacted the nine months ended September 30, 2024, $3 million due to the change in fair value of contingent consideration associated with our acquisition of Follow Up Boss, and $3 million in facility expenses driven by cost savings associated with changes in the use of certain office space in our lease portfolio. These decreases were partially offset by increases of $5 million in software and hardware costs and $4 million in third-party professional service fees, including legal expenses.
Other Income, net
Other income, net consists primarily of interest income earned on our cash, cash equivalents and investments.
Other income, net decreased $16 million and $43 million for the three and nine months ended September 30, 2025, respectively, as compared to the three and nine months ended September 30, 2024, primarily driven by lower interest income on investments due to a decrease in our investment balances as a result of the settlement of the 2024 Notes, 2025 Notes and 2026 Notes.
Interest Expense
Interest expense consists primarily of interest on our previously outstanding convertible senior notes, including the amortization of deferred issuance costs, and on our master repurchase agreements related to our Zillow Home Loans operations.
Interest expense decreased $6 million and $15 million for the three and nine months ended September 30, 2025, respectively, as compared to the three and nine months ended September 30, 2024, primarily due to the settlement of the 2024 Notes, 2025 Notes and 2026 Notes.
Income Taxes
On July 4, 2025, the One Big Beautiful Bill Act (the “Bill”) was enacted into law. The Bill provides for significant U.S. tax law changes and modifications and makes permanent certain key elements of the Tax Cuts and Jobs Act, including 100% bonus depreciation, the expensing of domestic research costs, and the business interest expense limitation. The provisions of the Bill did not have a material impact on our condensed consolidated financial statements for the three or nine month periods ended September 30, 2025.
We are subject to income taxes in the United States (federal and state) and certain foreign jurisdictions. As of September 30, 2025 and December 31, 2024, we have provided a valuation allowance against our net deferred tax assets that we believe, based on the weight of available evidence, are not more likely than not to be realized. There is a reasonable possibility that within the next several years, sufficient positive evidence will become available to demonstrate that a significant portion of the valuation allowance against our U.S. net deferred tax assets will no longer be required. We have accumulated federal tax losses of approximately $1.3 billion as of December 31, 2024, which are available to reduce future taxable income. We have accumulated state tax losses of approximately $66 million (tax effected) as of December 31, 2024.
Income tax expense was not material for the three and nine month periods ended September 30, 2025 or 2024.
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Liquidity and Capital Resources
Our primary sources of liquidity and capital resources are cash flows from operations, debt financing and equity offerings. Our cash requirements consist principally of working capital, general corporate needs and mortgage loan originations. We continue to invest in the development and expansion of our operations using available cash flows from operations. Ongoing investments include, but are not limited to, improvements in our technology platforms, investments in new products and services, and continued investments in sales and marketing. We also use cash flows from operations to service our debt obligations and to repurchase Class A common stock, Class C capital stock, or a combination thereof through our Repurchase Authorizations or otherwise.
Sources of Liquidity
As of September 30, 2025 and December 31, 2024, we had cash and cash equivalents, investments and restricted cash of $1.4 billion and $1.9 billion, respectively. Cash and cash equivalents balances consist of operating cash on deposit with financial institutions, money market funds, and, from time to time, U.S. government treasury securities and commercial paper. Investments consist of fixed income securities, which include U.S. government treasury securities, investment grade corporate securities, U.S. government agency securities, certificates of deposit and commercial paper. Restricted cash primarily consists of amounts used to fund customer home purchases in our mortgage origination operations. Amounts on deposit with third-party financial institutions exceed the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation insurance limits, as applicable. As of September 30, 2025, Zillow Group and its subsidiaries were in compliance with all debt covenants specified in the facilities described below.
We believe that cash from operations and cash and cash equivalents and investment balances will be sufficient to meet our ongoing operating activities, working capital, capital expenditures, strategic acquisitions and investments and other capital requirements for at least the next 12 months. We believe we will meet longer-term expected future cash requirements and obligations through a combination of cash flows from operations, debt financing and equity offerings, as applicable.
Summarized Cash Flow Information
The following table presents selected cash flow data for the periods presented (in millions, unaudited):

| Nine Months Ended September 30,
| 2025 |  | 2024
Cash Flow Data: |  |  |
Net cash provided by operating activities | $ | 296 |  |  | $ | 306 |
Net cash provided by investing activities | 44 |  |  | 121 |
Net cash used in financing activities | (546) |  |  | (847) |
Adjusted free cash flow | 295 |  |  | 231 |

Cash Flows Provided By Operating Activities
Our operating cash flows result primarily from cash received from real estate professionals, rental professionals, mortgage professionals, builders and brand advertisers, as well as cash received from sales of mortgages originated by Zillow Home Loans. Our primary uses of cash from operating activities include marketing and advertising activities, mortgages funded through Zillow Home Loans and employee compensation and benefits. Additionally, uses of cash from operating activities include costs associated with operating our mobile applications and websites and other general corporate expenditures.
For the nine months ended September 30, 2025, net cash provided by operating activities was $296 million. This was primarily driven by net income of $20 million, adjusted by share-based compensation of $295 million, depreciation and amortization of $199 million, amortization of contract cost assets of $16 million, accretion of bond discount of $7 million, amortization of right of use assets of $6 million, and $6 million in other adjustments to reconcile net income to net cash provided by operating activities. Changes in operating assets and liabilities decreased net cash provided by operating activities by $230 million. The changes in operating assets and liabilities are primarily related to a $132 million increase in mortgage loans held for sale due to an increase in purchase loan origination volume, a $67 million increase in prepaid expenses and other assets primarily due to an increase in accrued revenue, a $53 million increase in accounts receivable primarily due to an increase in revenue from products and services billed in arrears, an $18 million increase in contract costs assets primarily due to an increase in capitalized sales commissions, and a $9 million decrease in lease liabilities due to contractual lease payments. These changes were partially offset by a $32 million increase in accrued expenses and other current liabilities and an $8 million
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increase in accounts payable, both primarily driven by the timing of payments, and a $7 million increase in deferred revenue attributable to the timing of revenue recognition.
For the nine months ended September 30, 2024, net cash provided by operating activities was $306 million. This was driven by a net loss of $60 million, adjusted by share-based compensation of $329 million, depreciation and amortization of $178 million, accretion of bond discount of $23 million, amortization of contract cost assets of $14 million, amortization of right of use assets of $8 million, impairment costs of $6 million, amortization of debt issuance costs of $4 million, and $14 million in other adjustments to reconcile net loss to cash provided by operating activities. Changes in operating assets and liabilities decreased cash provided by operating activities by $164 million. The changes in operating assets and liabilities are primarily related to a $73 million increase in prepaid expenses and other assets primarily due to an increase in accrued revenue, a $64 million increase in mortgage loans held for sale due to an increase in purchase loan origination volume, a $31 million decrease in lease liabilities due to contractual lease payments, a $21 million increase in accounts receivable primarily due to an increase in revenue from products and services billed in arrears, and a $15 million increase in contract cost assets primarily due to capitalized sales commissions. These changes were partially offset by a $25 million increase in accounts payable driven by the timing of payments, an $8 million increase in accrued expenses and other current liabilities primarily driven by the timing of billings, and a $5 million increase in deferred revenue attributable to the timing of revenue recognition.
Cash Flows Provided By Investing Activities
Our primary investing activities include the purchase and sale or maturity of investments and the purchase of property and equipment and intangible assets.
For the nine months ended September 30, 2025, net cash provided by investing activities was $44 million. This was primarily related to $272 million of net proceeds from maturities and sales of investments, partially offset by $228 million of purchases of property and equipment and intangible assets, including a $100 million payment in connection with the rentals partnership we entered into with Redfin in February 2025.
For the nine months ended September 30, 2024, net cash provided by investing activities was $121 million. This was the result of $251 million of net proceeds from maturities and sales of investments and $130 million of purchases of property and equipment and intangible assets.
Cash Flows Used In Financing Activities
Our primary financing activities include repurchases of Class A common stock and Class C capital stock, the exercise of employee option awards, repayments of borrowings on our master repurchase agreements related to Zillow Home Loans, settlements of convertible senior notes and capped call transactions, and the payment of contingent consideration up to its acquisition-date fair value.
For the nine months ended September 30, 2025, net cash used in financing activities was $546 million, which primarily related to $438 million of cash paid for share repurchases, $419 million of cash paid for the settlement of the 2025 Notes, and $30 million related to the settlement of the acquisition date fair value of the first Follow Up Boss contingent consideration earn out payment. The cash outflows were partially offset by $176 million of proceeds from the exercise of stock options, $127 million of net borrowings on our master repurchase agreements related to Zillow Home Loans, and $38 million of proceeds from the settlement of capped call transactions.
For the nine months ended September 30, 2024, net cash used in financing activities was $847 million, which primarily related to $697 million of cash paid for the settlement of the 2024 Notes and partial repurchase of the 2025 Notes, and $301 million of cash paid for share repurchases. The cash outflows were partially offset by $96 million of proceeds from the exercise of stock options and $55 million of net borrowings on our master repurchase agreements related to Zillow Home Loans.
Adjusted Free Cash Flow
To provide investors with additional information regarding our liquidity, we have disclosed Adjusted free cash flow, a non-GAAP financial measure, in this Quarterly Report on Form 10-Q. We have provided a reconciliation below of Adjusted free cash flow to net cash provided by operating activities, the most directly comparable GAAP financial measure. 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 on repurchase agreements, and the initial payment in connection with the Redfin rentals partnership. Borrowings on 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
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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 Quarterly Report on Form 10-Q 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.
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):

| Nine Months Ended September 30,
| 2025 |  | 2024
Net cash provided by operating activities | $ | 296 |  |  | $ | 306 |
Purchases of property and equipment | (105) |  |  | (109) |
Purchases of intangible assets | (123) |  |  | (21) |
Net borrowings on repurchase agreements | 127 |  |  | 55 |
Initial payment in connection with Redfin rentals partnership | 100 |  |  | — |
Adjusted free cash flow | $ | 295 |  |  | $ | 231 |

Capital Resources
Settlement of 2025 Notes
The 2025 Notes matured on May 15, 2025, and we settled the remaining $419 million in aggregate principal amount of the 2025 Notes with cash payments totaling $425 million, which included $419 million in principal repayments, $6 million for accrued interest, and a nominal cash payment in lieu of fractional shares, and the issuance of a nominal number of shares of Class C capital stock.
Settlement of Capped Call Transactions
In August 2025, we settled the capped call transactions we entered into in connection with the issuance of the 2026 Notes, resulting in the receipt of approximately 3.1 million shares of Class C capital stock and $38 million in cash. Subsequent to this settlement, no capped call transactions remain outstanding.
Refer to Note 6 of our Notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q for additional information regarding our 2025 Notes and capped call transactions.
Share Repurchases
On May 2, 2025, the Board authorized the repurchase of up to an additional $1 billion of our Class A common stock, Class C capital stock, or a combination thereof, which increased our total cumulative Repurchase Authorizations to $3.5 billion as of September 30, 2025. During the nine months ended September 30, 2025, we repurchased 4.7 million shares of Class A common stock and 1.4 million shares of Class C capital stock at an average price of $71.39 and $73.19 per share, respectively, for an aggregate purchase price of $335 million and $103 million, respectively. As of September 30, 2025, $943 million remained available for future repurchases of our stock pursuant to the Repurchase Authorizations, which repurchases decrease our liquidity and capital resources when effected. For additional information on these authorizations, see Notes 10 and 12 of our Notes to Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
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Credit Facilities
Zillow Home Loans operations impact our liquidity and capital resources as a cash intensive business that funds mortgage loans originated for resale in the secondary market. We primarily use debt financing to fund mortgage loan originations. The following table summarizes our master repurchase agreements as of the periods presented (in millions, except interest rates):

Lender |  | Maturity Date |  | Maximum Borrowing Capacity |  | Outstanding Borrowings at September 30, 2025 |  | Outstanding Borrowings at December 31, 2024 |  | Weighted Average Interest Rate at September 30, 2025
JPMorgan Chase Bank, N.A.(1) |  | April 28, 2026 |  | $ | 200 |  |  | $ | 120 |  |  | $ | 72 |  |  | 5.87 | %
UBS AG(2) |  | September 4, 2026 |  | 150 |  |  | 78 |  |  | 73 |  |  | 5.88 | %
Bank of Montreal(3) |  | February 26, 2026 |  | 150 |  |  | 74 |  |  | — |  |  | 5.85 | %
Bank of Nova Scotia(4) |  | June 8, 2026 |  | 100 |  |  | — |  |  | — |  |  | — | %
|  | Total |  | $ | 600 |  |  | $ | 272 |  |  | $ | 145 |  |  |

(1) Agreement was amended on April 29, 2025 to increase the total maximum borrowing capacity from $150 million to $200 million and to extend the maturity date to April 28, 2026.
(2) Agreement was amended and renewed on September 5, 2025 to extend the maturity date to September 4, 2026.
(3) Agreement was entered into on February 27, 2025.
(4) Agreement was entered into on June 9, 2025.
Refer to Note 6 of our Notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q for additional information on Zillow Home Loans’ master repurchase agreements.
Contractual Obligations and Other Commitments
Credit Facilities - Includes principal amounts due for amounts borrowed under the master repurchase agreements to finance mortgages originated through Zillow Home Loans. Principal amounts under the master repurchase agreements are due when the related mortgage loan is sold to an investor or directly to an agency. As of September 30, 2025, we have outstanding principal amounts of $272 million. Amounts exclude an immaterial amount of estimated interest payments.
Operating Lease Obligations - Our lease portfolio comprises operating leases for our office space. During the three months ended September 30, 2025, there were no material changes to our operating lease obligations disclosed in Note 9 of the Notes to the Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
Contingent Consideration - In connection with the acquisition of Follow Up Boss, we are obligated to pay contingent consideration upon the achievement of certain performance metrics over a three-year period measured at each anniversary of the closing date of the acquisition. For additional information regarding this contingent consideration, see Note 3 of our Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q.
Purchase Obligations - We have non-cancelable purchase obligations for content related to our mobile applications and websites, certain cloud computing services and payments under certain partnership agreements. For additional information regarding our purchase obligations, see Note 11 to our Notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q.
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Critical Accounting Estimates
Our condensed consolidated financial statements are prepared in accordance with GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosures. We evaluate our estimates, judgments and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates, and the health of the housing market and the broader economy have introduced significant additional uncertainty with respect to estimates, judgments and assumptions, which may materially impact our estimates. For information on our critical accounting policies and estimates, see Part II, Item 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. There have been no material changes to our critical accounting policies and estimates as previously disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.
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Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to market risks in the ordinary course of our business. These risks primarily consist of fluctuations in interest rates.
Interest Rate Risk
Under our current investment policy, we invest our excess cash in money market funds, U.S. government treasury securities, investment grade corporate securities, U.S. government agency securities, certificates of deposit and commercial paper. Our current investment policy seeks first to preserve capital, second to provide sufficient liquidity for our operating and capital needs and third to maximize yield.
Our short-term investments are exposed to market risk due to the fluctuation of prevailing interest rates that may reduce the yield on our investments or their fair value. For our investment portfolio, we do not believe an immediate 10% increase in interest rates would have a material effect on the fair market value of our portfolio.
We are also subject to market risk which may impact our mortgage loan origination volume and associated revenue and the net interest margin derived from borrowings under our master repurchase agreements that provide capital for Zillow Home Loans. Market risk occurs in periods where changes in short-term interest rates result in mortgage loans being originated with terms that provide a smaller interest rate spread above the financing terms of our master repurchase agreements, which can negatively impact our results of operations. This risk is primarily mitigated through the expedited sale of our loans. As of September 30, 2025 and December 31, 2024, we had $272 million and $145 million, respectively, of outstanding borrowings on our master repurchase agreements which bear interest at a floating rate based on SOFR plus an applicable margin, as defined by the governing agreements. We manage the interest rate risk associated with our mortgage loan origination services through the use of forward sales of MBSs. Assuming no change in the outstanding borrowings on the master repurchase agreements, we estimate that a one percentage point increase in SOFR would not have a material effect on our interest expense associated with the master repurchase agreements for the three months ended September 30, 2025.
For additional details related to our credit facilities, see Note 6 to our Notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q.
Inflation Risk
The macroeconomic environment in the United States has experienced, and continues to experience, inflationary pressures. These pressures may escalate due to changes in federal policy, including proposed or newly implemented tariffs. While it is difficult to accurately measure the impact of these inflationary pressures on our business, we believe these effects have been pervasive throughout our business during the past several years. During this time, ongoing inflationary pressures in the United States have led to increases in the federal funds rate. Despite inflation stabilizing beginning in the second half of 2023 and the federal funds rate decreasing over the past year, prior federal funds rate increases have impacted other market rates derived from this benchmark rate, including mortgage interest rates. The persistently high mortgage interest rates across the industry relative to recent years has impacted the number of transactions consumers complete using our products and services and the demand for our advertising services and mortgage origination offerings and, in turn, had an adverse impact on our revenue.
If inflationary pressures persist, our costs, in particular labor, marketing and hosting costs, may increase and we may not be able to fully offset such higher costs through price increases. In addition, uncertain or changing economic and market conditions, including inflation or deflation, may continue to affect demand for our products and services and the housing markets in which we operate. Our inability or failure to quickly respond to inflation could harm our business, results of operations and financial condition. We cannot predict the duration or magnitude of these inflationary pressures, or how they may change over time, but we expect to see continued impacts on the residential real estate industry, our customers and our company. Despite these near-term effects, we do not expect these inflationary pressures to have a material impact on our ability to execute our long-term business strategy.
Foreign Currency Exchange Risk
We do not believe that foreign currency exchange risk has had a material effect on our business, results of operations or financial condition. As we do not maintain a significant balance of foreign currency, we do not believe an immediate 10% increase or decrease in foreign currency exchange rates relative to the U.S. dollar would have a material effect on our business, results of operations or financial condition.
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Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company maintains disclosure controls and procedures (as defined under Rules 13a-15(e) and 15d-15(e) of the Exchange Act). Management, under the supervision and with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(b) as of September 30, 2025. Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that these disclosure controls and procedures were effective as of September 30, 2025.
Changes in Internal Control Over Financial Reporting
There were no changes in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act, that occurred during the three months ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II – OTHER INFORMATION
Item 1. Legal Proceedings
For information regarding legal proceedings in which we are involved, see Note 11 under the subsection titled “Legal Proceedings” in our Notes to Condensed Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.
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Item 1A. Risk Factors
The following risk factor updates the corresponding risk factor set forth in Part I, Item 1A (Risk Factors) in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. You should carefully consider the risks described below and in our Annual Report on Form 10-K, which could materially affect our business, financial condition or future results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.
We are from time to time involved in, and have in the past or may in the future be subject to claims, suits, government investigations, enforcement actions, and other proceedings (collectively, “legal proceedings”) that may result in adverse outcomes.
We are from time to time involved in, and have in the past or may in the future be subject to legal proceedings arising from our business, including actions with respect to intellectual property, privacy, consumer protection, information security, mortgage brokering, mortgage origination, real estate, real estate brokerage, environmental, data protection, antitrust, the Real Estate Settlement Procedures Act of 1974 (RESPA), fair housing or fair lending, compliance with securities laws, or law enforcement matters, tax matters, labor and employment, and commercial claims, as well as actions involving content generated by our customers, shareholder derivative actions, purported class action lawsuits, and other matters. We are also from time to time involved in, and have in the past or may in the future be subject to legal proceedings arising from or related to discontinued products and services, including actions with respect to the purchase, renovation and resale of properties, including homes previously held in our inventory.
The number and scope of potential legal proceedings may increase as our business expands and our products and services evolve. For example, in recent months, we have been named in complaints filed by the Federal Trade Commission, certain state attorneys general, Compass, Inc., CoStar Group, Inc., and a consumer plaintiff, alleging antitrust, intellectual property, consumer protection, RESPA, and other claims. See Note 11 of our Notes to Condensed Consolidated Financial Statements in this Quarterly Report on Form 10-Q for additional information about certain of these and other legal proceedings.
These and other legal proceedings that we are, have, or may be involved in are inherently uncertain, and their results cannot be predicted with certainty. Regardless of the outcome, any such legal proceedings could have an adverse impact on us because of legal costs, diversion of management and other personnel, and other factors. In addition, it is possible that a resolution of one or more such proceedings could result in reputational harm, liability, fines, penalties, or sanctions, as well as judgments, consent decrees, or orders preventing us from offering certain features, functionalities, products, or services, or requiring a change in our business practices, products or technologies, which could in the future materially and adversely affect our business, operating results and financial condition.
In some instances, third parties may have an obligation to indemnify us for liabilities related to litigation or governmental investigations, and they may be unable to, or fail to, fulfill such obligations. If such third parties failed to indemnify us, we may be financially responsible, which could adversely affect our financial condition and cash flow.
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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sales of Equity Securities
There were no unregistered sales of equity securities during the three months ended September 30, 2025.
Purchase of Equity Securities by the Issuer
The following table summarizes our share repurchases during the three months ended September 30, 2025 (in millions, except share data which are presented in thousands, and per share amounts):

|  | Total Number of Shares Purchased |  | Average Price Paid Per Share |  | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) |  | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (1)
Period |  | Class A common stock |  | Class C capital stock |  | Class A common stock |  | Class C capital stock |  |
July 1 - July 31, 2025 |  | — |  |  | — |  | $ | — |  |  | $ | — |  |  | — |  |  | $ | 981 |
August 1 - August 31, 2025 |  | 457 |  |  | — |  | 83.51 |  |  | — |  |  | 457 |  |  | 943 |
September 1 - September 30, 2025 |  | — |  |  | — |  | — |  |  | — |  |  | — |  |  | 943 |
Total |  | 457 |  |  | — |  |  |  |  |  | 457 |  |  |
(1) On December 2, 2021, the Board authorized a share repurchase program granting the authority to repurchase up to $750 million of Class A common stock, Class C capital stock or a combination of both. This authorization was supplemented with additional Board authorizations to increase the aggregate repurchase capacity to a total of $2.5 billion and to allow for the repurchase of a portion of our convertible senior notes. On May 2, 2025, the Board authorized the repurchase of up to an additional $1 billion of Class A common stock, Class C capital stock, or a combination thereof, increasing the total Repurchase Authorizations to $3.5 billion. The Repurchase Authorizations do not have an expiration date.

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Item 5. Other Information
On August 19, 2025, Bradley D. Owens, General Counsel and Corporate Secretary of the Company, entered into a 10b5-1 sales plan intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act. This 10b5-1 sales plan provides for (1) the sale of up to 470,670 shares of Class C capital stock related to the exercise of option awards granted to Mr. Owens and (2) the sale of an indeterminate number of shares of Class C capital stock related to the vesting of restricted stock units granted to Mr. Owens. The number of shares of Class C capital stock that will be sold under this 10b5-1 sales plan related to vesting of restricted stock unit awards is not yet determinable because (i) certain future awards granted during the life of the plan that follow the same vesting schedule as existing awards under the plan may be covered by the terms of the plan and (ii) for each vested restricted stock unit award that is covered by the terms of the plan, an unknown number of shares will be sold to satisfy tax withholding prior to any sale occurring under the terms of the plan. This 10b5-1 sales plan will become effective on November 19, 2025 and will terminate on August 19, 2027, subject to earlier termination as provided in the plan.
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Item 6. Exhibits
The exhibits listed below are filed as part of this Quarterly Report on Form 10-Q.

Exhibit Number |  | Description
3.1 |  | Amended and Restated Articles of Incorporation of Zillow Group, Inc. (Filed as Exhibit 3.1 to Registrant’s Current Report on Form 8-K filed with the SEC on February 17, 2015, and incorporated herein by reference).
3.2 |  | Amended and Restated Bylaws of Zillow Group, Inc. (Filed as Exhibit 3.1 to Registrant’s Current Report on Form 8-K filed with the SEC on June 5, 2020, and incorporated herein by reference).
31.1 |  | Certification of Chief Executive Officer pursuant to Rule 13-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2 |  | Certification of Chief Financial Officer pursuant to Rule 13-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1^ |  | Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2^ |  | Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS |  | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document).
101.SCH |  | Inline XBRL Taxonomy Extension Schema Document.
101.CAL |  | Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF |  | Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB |  | Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE |  | Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104 |  | Cover Page Interactive Data File (embedded within the inline XBRL document).
^ |  | The certifications attached as Exhibits 32.1 and 32.2 that accompany this Quarterly Report on Form 10-Q are not deemed filed with the SEC and are not to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of this Quarterly Report on Form 10-Q), irrespective of any general incorporation language contained in such filing.

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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, thereunto duly authorized.

Dated: October 30, 2025 |  | ZILLOW GROUP, INC.
|  | By: | /s/ J ENNIFER R OCK
|  | Name: | Jennifer Rock
|  | Title: | Chief Accounting Officer

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