Zillow Group reported record revenue and profits in the third quarter as the real estate company remains on track for its first year of $1 billion in revenue.
Zillow reported earnings of 19 cents per share on $281.8 million revenue, beating expected earnings of 18 cents per share on $276.9 million in revenue. Zillow reported record net profits of $9.2 million, representing approximately 3 percent of revenue, up from $6.8 million a year ago.
Zillow stock is up 4 percent on news of the strong quarterly report.
Zillow also saw record traffic over the summer. An all-time high of more than 187 million unique users came to Zillow’s mobile apps and websites, an increase of more than 17 million unique users from the year before. Zillow recently shifted its Zestimate tool to the cloud, ensuring that the increased visitor traffic will still receive on-point estimates.
Following the strong quarter, Zillow upped its annual revenue guidance to a range of $1.068 to $1.073 billion. Last quarter, the expected range was $1.055 to $1.065 billion.
To pull in more viewers and diversify its revenue stream, Zillow introduced or expanded several new projects in the quarter. Zillow expanded Instant Offers, which connects homeowners to offers from investors and provides a comparative market analysis from a local real estate agent, beyond its initial markets of Las Vegas and Orlando. Launched in May, Instant Offers will soon bring the service to Phoenix.
“The purpose of the test is to determine where sellers see the balance between convenience and price,” Zilow CEO Spencer Rascoff said. “It is still early in the experiment, so we are not sharing specific results, but we are seeing a positive response from agents, direct homebuyers and sellers. We identified an opportunity to innovate on this emerging trend and to provide more transparency for consumers, while delivering high-quality seller listing leads to Premier Agents.”
Last month, Zillow began rolling out a new feature called “3D Home” that lets users build 360-degree tours of homes like they would using the panoramic setting on their iPhone camera. Photographs are uploaded through the app and stitched together automatically by Zillow to create a seamless tour from room to room. Rascoff said the company is testing the service with plans to launch it nationwide in 2018.
“We’ve been working for the past two years on a way to democratize this technology and make it freely available,” Rascoff said. “It’s hard for me to overstate the level of creativity and sophisticated technical knowledge that has made this product a reality. Stitching together still photos taken from an iPhone to create an immersive 3D panorama tour requires teams intently focused on machine learning and image recognition.”
To beef up its new construction offerings, Zillow in September acquired New Home Feed. The Bay Area-based startup offers real estate listing management technology to developers and builders. Zillow plans to integrate the technology directly into its platform.
“This acquisition makes it easier for our builder partners to send their listings to Zillow Group and ultimately improve the quality and accuracy of our new construction listings across our consumer brands,” Rascoff said. “We look forward to partnering with more builders to help them build their brands and increase discoverability of their new construction homes.”