CoStar Group, Inc. (NASDAQ: CSGP) has authorized a new $1.5 billion share‑repurchase program, extending the company’s capital‑allocation strategy beyond the $500 million program that was fully completed in 2025. The new authority is unlimited and can be exercised at any time, with no specified time frame for completion, giving management flexibility to return capital to shareholders while preserving liquidity for future growth initiatives.
The decision follows a year of robust cash‑flow generation. In 2024, CoStar reported revenue of $2.74 billion, up 11% year‑over‑year, and net income of $139 million, a decline from $375 million in 2023 but still a solid operating base. Adjusted EBITDA for the year reached $111.9 million, reflecting a 47% margin that underscores the company’s high‑margin commercial information and marketplace businesses. The 2025 guidance for revenue of $3.78 billion to $3.82 billion and adjusted EBITDA of $740 million to $800 million signals confidence in continued demand for its data‑driven platforms.
In Q1 2025, CoStar posted a net loss of $15 million ($0.04 per diluted share) largely due to a $31 million one‑time charge from the Matterport acquisition. The loss represented a miss against the consensus EPS estimate of $0.12, illustrating the impact of the acquisition on short‑term profitability. Despite the loss, adjusted EBITDA rose to $66 million, a 429% increase from Q1 2024, driven by strong performance in the commercial information segment and a favorable mix shift toward higher‑margin services.
The company’s strategic focus includes a significant reduction in its investment in Homes.com, with a planned $300 million net reduction in 2026 from $850 million in 2025. This move aims to bring the subsidiary to positive adjusted EBITDA by 2030 and reflects a broader shift toward higher‑margin, subscription‑based offerings. CoStar is also accelerating the deployment of AI across its platforms, a priority highlighted by CEO Andy Florance, who emphasized that the scalable AI platform and disciplined capital allocation will continue to drive profitability and shareholder value.
Management’s guidance for 2026 includes an adjusted EPS range of $1.22 to $1.33, below the consensus estimate of $1.38, indicating a cautious outlook on earnings per share growth. However, the company’s revenue guidance remains near the upper end of the consensus range, and the guidance for adjusted EBITDA represents the highest level in company history, underscoring confidence in the company’s ability to generate cash flow while pursuing strategic investments.
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