GET DAILY SIGNALSZillow Group (ZG) Posts +7% Revenue Growth in Q3 but Misses Estimates
Key Takeaways
- Total revenue rose 7% year over year to $724 million, but came in below the roughly $752 million analyst consensus estimate.
- Diluted adjusted earnings per share (EPS) reached $0.55, up from $0.44 a year earlier, yet missed the consensus of about $0.58.
- Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) was $182 million, below the roughly $191 million expected by analysts.
- On a GAAP (Generally Accepted Accounting Principles) basis, Zillow posted a net loss of $158 million, largely driven by a $165 million Zillow Offers securities class action settlement.
- Rentals revenue climbed 26% and mortgages revenue jumped 32%, while for-sale residential revenue declined 4% amid rising mortgage rates.
- Fourth-quarter and full-year guidance both fell short of consensus, reflecting a persistently difficult U.S. housing market.
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Why This Quarter Matters
Zillow Group delivered its third-quarter 2026 results against what management called one of the toughest housing markets in a generation. Higher mortgage rates have squeezed affordability and slowed deals, hitting the core residential business hardest. For investors, the report tests how well diversification into rentals and mortgages can cushion weakness in for-sale homes. The quarter also underscores the impact of non-GAAP adjustments, especially with a large legal settlement affecting reported profits. As a key indicator for U.S. real estate tech, these results give a timely view of housing demand, traffic patterns, and the strength of subscription and financing lines.
Breaking Down the Numbers
Zillow Group reported third-quarter 2026 total revenue of $724 million, up 7% from $676 million a year earlier but below the analyst consensus of roughly $752 million. Diluted adjusted EPS came in at $0.55, an improvement from $0.44 in the prior-year period yet below the consensus of about $0.58. Adjusted EBITDA reached $182 million, up from $165 million a year ago but short of the approximately $191 million analysts had anticipated.
Segment results were uneven. For-sale residential revenue dropped 4% year over year to $419 million as elevated mortgage rates cut transaction activity. Rentals revenue rose 26% to $220 million, and mortgages revenue increased 32% to $70 million, helped by a 55% jump in purchase loan volume to $2 billion. Traffic eased, with average monthly unique users falling 3% to 215 million and visits declining 5% to 2.3 billion.
On a GAAP basis, Zillow Group recorded a net loss of $158 million, or $0.70 per diluted share, compared with a net profit of $10 million, or $0.04 per share, a year earlier. The loss stems mainly from a $165 million Zillow Offers securities class action settlement, which the company excludes from adjusted figures. I also checked this using Tickeron’s AI Screener to see how the stock compares to others in the industry.
Market Reaction and Sentiment
Zillow Group shares declined in after-hours trading after the release. The revenue and profit shortfalls, paired with softer guidance, weighed on sentiment. Investors noted the unusual miss across revenue, adjusted EPS, and adjusted EBITDA, along with softer traffic numbers that suggested cooling consumer interest. The stock had already fallen more than half its value year to date through early November amid broader pressure on housing-related equities. The size of the after-hours drop indicated the market saw the guidance shortfall as the bigger near-term concern.
Forward Outlook and Factors to Watch
For the fourth quarter of 2026, Zillow Group guided revenue to a range of $635 million to $665 million and adjusted EBITDA to between $100 million and $135 million, both below consensus. For the full year, the company now expects revenue growth of roughly 10% to 11% and adjusted EBITDA of $655 million to $690 million.
Several items will draw close attention in coming quarters. Mortgage rate trends remain the main driver of affordability and transaction volume in the for-sale segment. Persistent high rates could further limit residential revenue, while any sustained drop might support buyer activity. Momentum in rentals and mortgages will also matter, as the 26% and 32% growth rates show diversification, though investors will want to see these areas scale fast enough to offset residential softness. Finally, traffic trends and partner economics deserve monitoring, as lower unique users and visits raise questions about engagement even as the company highlights brand strength.
Using Tickeron Tools in My Research
When analyzing earnings like these, I often turn to Tickeron’s AI Screener to quickly filter comparable real estate tech names and spot relevant patterns. It helps surface ideas based on fundamentals, volatility, and AI signals without spending hours on manual work. The tool has become a regular part of my process for staying on top of sector shifts.
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Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
ZG's RSI Indicator recovers from overbought zone
The 10-day RSI Indicator for ZG moved out of overbought territory on October 23, 2026. This could be a sign that the stock is shifting from an upward trend to a downward trend. Traders may want to look at selling the stock or buying put options. Tickeron's A.I.dvisor looked at 23 instances where the indicator moved out of the overbought zone. In 20 of the 23 cases the stock moved lower in the days that followed. This puts the odds of a move down at 87%.
Technical Analysis (Indicators)
Bearish Trend Analysis
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ZG declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 80%.
ZG broke above its upper Bollinger Band on October 22, 2026. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 47 of 61 cases where ZG's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 77%.
The Momentum Indicator moved above the 0 level on November 04, 2026. You may want to consider a long position or call options on ZG as a result. In 56 of 80 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are 70%.
The Moving Average Convergence Divergence (MACD) for ZG just turned positive on October 08, 2026. Looking at past instances where ZG's MACD turned positive, the stock continued to rise in 33 of 46 cases over the following month. The odds of a continued upward trend are 72%.
ZG moved above its 50-day moving average on November 04, 2026 date and that indicates a change from a downward trend to an upward trend.
The 10-day moving average for ZG crossed bullishly above the 50-day moving average on October 27, 2026. This indicates that the trend has shifted higher and could be considered a buy signal. In 14 of 18 past instances when the 10-day crossed above the 50-day, the stock continued to move higher over the following month. The odds of a continued upward trend are 78%.
Following a +12.41% 3-day Advance, the price is estimated to grow further. Considering data from situations where ZG advanced for three days, in 218 of 301 cases, the price rose further within the following month. The odds of a continued upward trend are 72%.
The Aroon Indicator entered an Uptrend today. In 150 of 204 cases where ZG Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are 74%.
Fundamental Analysis (Ratings)
The Tickeron Seasonality Score of 37 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Price Growth Rating for this company is 62 (best 1 - 100 worst), indicating steady price growth. ZG’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is 89 (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of 94 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.798) is normal, around the industry mean (1.069). P/E Ratio (149.783) is within average values for comparable stocks, (-42.791). Projected Growth (PEG Ratio) (0.920) is also within normal values, averaging (17.274). Dividend Yield (0.000) settles around the average of (0.985) among similar stocks. P/S Ratio (2.780) is also within normal values, averaging (71.888).
The Tickeron PE Growth Rating for this company is 95 (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Profit vs. Risk Rating rating for this company is 100 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. ZG’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 93, placing this stock worse than average.
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a real estate app
Industry InternetSoftwareServices
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