CoStar Group closed 2025 with fourth quarter revenue up 27% to $900 million and full-year revenue up 19% to $3.2 billion, its 59th consecutive quarter of double-digit growth, while full-year adjusted EBITDA jumped 83% to $442 million. The company delivered record net new bookings of $308 million and reorganized its reporting into commercial and residential segments, with LoopNet posting its fastest growth since 2021 and Homes.com growing 63%. Management affirmed 2026 guidance of $3.78 billion to $3.82 billion in revenue and $740 million to $800 million in adjusted EBITDA, describing 2026 as an EBITDA-expansion phase now that the Homes.com launch spend is behind them. Investor attention focused on whether bookings were softening, the commercial margin drag from inorganic Matterport and Domain, and the still-negative residential segment guided to negative $45 million in Q1. Strategic highlights included the Homes AI launch, elimination of about $120 million of Matterport duplicative costs, and a new $1.5 billion buyback authorization funding $700 million of 2026 repurchases.
Hello, thank you for joining us to discuss the full year and fourth quarter 2025 results of CoStar Group. Before I turn the call over to Andy Florance, CoStar CEO and founder, and Chris Lown, our CFO, I'd like to review our safe harbor statement. Certain portions of the discussion today may contain forward-looking statements, including the company's outlook and expectations for the first quarter, full year of 2026 and beyond. These statements are based on current beliefs and assumptions, and forward-looking statements involve many risks, uncertainties of assumptions, estimates, and other factors that can cause actual results to differ materially from such statements.
Important factors that can cause actual results to differ include, but are not limited to, those stated in CoStar Group's press release issued earlier today, and in our filings with the SEC, including our annual report on Form 10-K and quarter reports on Form 10-Q, included under the heading Risk Factors in these filings, as well as other filings with the SEC available on the SEC's website. All forward-looking statements are based on the information available to CoStar on the date of this call. CoStar assumes no obligation to update these statements, whether as a result of new information, future events, or otherwise, except as required by applicable law. Reconciliation is the most directly comparable GAAP measure or of any Non-GAAP financial measure discussed on this call, as shown in detail in our press release issued today, along with the definitions of those terms.
Press release available on our website, located at costargroup.com, under Press Room. Please refer to the press release on how to access the replay of this call. Remember, it's one question during the Q&A session, so make it a good one. Be good. With that, I'd like to turn the call over to our Founder and CEO, Andy Florance.
I think today we're going to do two questions.
Nice.
Good afternoon, everybody. Revenue for the fourth quarter rose 27% year-over-year to $900 million. That's an increase of $191 million from $709 million of revenue in the fourth quarter of 2024. Revenue for 2025 was $3.2 billion, up 19% from $2.7 billion in 2024. This is our 59th consecutive quarter of double-digit revenue growth. Adjusted EBITDA of 2025 was $442 million, up 83% from $241 million in 2024. This result positions us well to achieve our guidance range of $740 million-$800 million full-year adjusted EBITDA in 2026. With the heavy lifting of Homes.com national brand launch behind us, we are entering a phase of significant EBITDA expansion.
We delivered our strongest year ever for annualized net new sales bookings in 2025, reaching $308 million, up 23% from 2024. Fourth quarter net new bookings were up 42% year-over-year. We consider CoStar, LoopNet, Real Estate Manager, Ten-X, BizBuySell, and elements of Matterport as commercial real estate-related businesses, and their operations are connected and related. These commercial businesses, as a group, grew 20% year-over-year and generated $471 million of revenue in the fourth quarter of 2025. For the full year, the commercial business grew 18% to reach $1.79 billion for the full year of 2025. The U.S. commercial real estate market is showing good recovery from the extraordinary headwinds it experienced in the COVID years.
After years of massive negative absorption of office space, it has now turned positive, it's been positive for the past two quarters, and vacancies are clearly dropping. After the ultra-low COVID vacancy rates, industrial vacancy rates are normalizing. With the leasing fundamentals stabilizing, commercial sales volumes have climbed 30% year-over-year, in fact, now are above long-term averages. The CRE economy is shifting from headwind to tailwind. For our disclosures moving forward, we have combined CoStar with what we've previously referred to as information services. Any reference to CoStar now includes our information services products. As the CRE economy improves and we continue to expand the product offering, CoStar Group has generated seven consecutive quarters of accelerating growth. Net new bookings in Q4 2025 were up 54% year-over-year.
CoStar revenues grew 10% year-over-year, generating $325 million in the fourth quarter of 2025. We have grown the CoStar sales team 20% year-over-year to 492 reps and believe that will support further revenue acceleration. We ended 2025 with our NPS at an all-time high of 70, and our quarterly renewal rate rose to 94%. CoStar now has more than 300,000 subscribers, up 26% year-over-year in Q4. Total searches in CoStar climbed 14% year-over-year to 422 million. CoStar Canada is solidly profitable and revenues grew 21% year-over-year. Canadian CoStar is French, English, bilingual.... CoStar U.K. is solidly profitable, is enjoying a 92% renewal rate, and has gained significant competitive share in 2025.
A primary U.K. competitor, EG Radius, shut down their operations in December 2025. We have onboarded 166 of their reported 150 clients, I think we got most of them, with 75% of them on three-year deals. EG Radius has passed between various ownership groups through time, it descends from Estates Gazette, which was the clear major market leader in the U.K. when we entered that market 21 years ago. We have built out the software and datasets for CoStar France, expect to release in the second quarter, and expect to have similar successes there. We are now well underway in staffing our CoStar research and photography capabilities in Australia, with over 50 people already in place. These teams are instrumental in generating a depth of proprietary data and visual assets that's not currently available in Australia.
In just over six weeks, we've added thousands of listings. We expect to release CoStar for Australia in late 2026. In a typical year, there are about 1 million new single-family homes and condos built in the U.S., with a combined value of just under half a trillion dollars. The developers and lenders behind these projects need reliable information on supply, absorption, prices, land comps, and model mixes. Three hundred plus developers are feeding us data to market their new homes for sale on Homes.com, we can release a new homes information module in CoStar in the third quarter of 2026. The wealth of residential land valuation analytic information already in CoStar, we can build a very competitive offering. We expect demand for new homes information is a $200 million-$300 million revenue opportunity for CoStar.
In December, we launched our coverage of nearly 4,000 data centers worldwide. For each property, we have data on capacity, redundancy, and resilience attributes, and how well it fits in the broader build-out of the power grid infrastructure. The product also provides visibility into substation locations, transmission lines, their peak capacity, and retail utility providers. Our dataset includes over 1,600 individual center with sales value exceeding $43 billion and over 29 gigawatts of power capacity. In an increasingly AI-centric global economy, our rapidly growing dataset will prove an invaluable day-to-day tool for center developers, operators, and owners. As discussed on previous earnings calls, we're developing a Rent Benchmark product, which we expect to deliver in Q2.
Built upon the industry's largest collection of lease deals, CoStar Rent Benchmark uses AI to extract starting rents, TI allowances, rent concessions, escalations, and more from the actual legal leasing document. After abstraction, leases are anonymized and aggregated to deliver the industry's only net effective rent product, allowing the user to understand the true cost of occupancy. Corporate occupiers, owners, and brokers alike will reap tremendous value from being able to tap into the largest source of verified lease information to inform their leasing decisions and more effectively manage their real estate portfolios. In January 2026, we added more than 110 million residential parcels into our CoStar information product, providing our users with public record information across every parcel in America. For STR, Q4 capped off a record-breaking 2025, delivering the highest net new revenue in the company's history there.
25% of that net new revenue came from owner and management companies. Q4 also marked the completion of a major client migration, ultimately bringing 98,000 new users into the CoStar platform, with the STR Benchmark feature serving as their entry point. Q4 was equally pivotal from a product development perspective, culminating in a major release this week. Yesterday, STR announced the launch of a profitability benchmarking, giving hotel owners and operators a fully integrated view of top line and bottom line performance. With this release, CoStar with STR Benchmark becomes the only hotel benchmarking solution to integrate revenue, expenses, profits, and full property lifecycle insights into one place. We have rebranded our lender product to CoStar Debt Solutions to better reflect the breadth of customers we serve, including banks, credit unions, private lenders, insurers, agency lenders and debt funds, CMBS investors, and regulators.
CoStar Debt Solutions has surpassed $100 million in annual run rate revenue. We see a clear path to a billion-dollar-plus opportunity as we expand our debt product with benchmarking, loan origination, and residential solutions. We expect to launch debt benchmarking in the second half of this year, with loan origination in the first quarter of 2027. Having had a chance to look at some of the features of the debt benchmarking, it's really remarkable, and I think it'll be an incredibly strong product. CoStar Real Estate Manager had an exceptionally strong fourth quarter, with net new bookings in the quarter up 48% year-over-year and up 211% quarter-over-quarter. Revenues now exceed $120 million.
We've extended our reach into the Fortune 50 in 2025 with a new client win, that it's our largest initial contract ever for Real Estate Manager. We also won business from one of the top three real estate service providers in our industry, who will sunset their legacy in-house lease management technology in favor of outsourcing to Real Estate Manager. I'm pleased with the progress we're making on our product roadmap to consolidate Real Estate Manager, Visual Lease, CoStar, and our Transaction Manager into one best-in-class corporate real estate solution. In combination with AI-powered lease abstraction benchmarking, I believe we can take very significant share in this category over the next several years. LoopNet had an outstanding 2025, generating $312 million in revenue. Q4 2025 was the fastest growth at LoopNet since 2021, ending at 17% year-over-year.
All of this was driven by record and net new sales, which tripled for the full year of 2025 compared to 2024. We intend to build on these extremely valuable gains by rapidly expanding the LoopNet sales team. We ended 2025 with 177 sales reps, and we plan to hire 80 more reps in 2026, a 43% increase. Over 2022-2024, LoopNet had over-indexed on depth advertising at the expense of coverage, and to some extent, to the expense of a predictable advertiser ROI. I'm pleased that our focus has changed and that 93% of this record net new bookings in 2025 came from silver listings, which tend to have consistent higher renewal rates. Consequently, paid listings increased by 9% in the U.S., 42% in Canada, and 156% in the U.K.
Thank you, Andy. For the full year of 2025, revenue was $3.2 billion and a 19% year-over-year increase over 2024. This was ahead of consensus and above the high end of our full year revenue guidance range. Our revenue outperformance primarily came from higher than expected contributions from CoStar, Matterport, and Domain. Full year adjusted EBITDA in 2025 also came in above expectations at $442 million, posting a 14% adjusted EBITDA margin. This also exceeded consensus in the high end of our guidance range. The combination of our revenue beat and lower than anticipated personnel costs drove the adjusted EBITDA beat for the year. As Andy mentioned in his remarks, we've revised our reporting segments into a commercial segment and a residential segment.
The new presentation aligns with how we view and manage the business, and we believe it provides shareholders with the best understanding and representation of our financial performance. On this call, I will address our results under both our historical and new disclosure methodologies. Going forward, I will discuss business performance and expectations using our new segment and disaggregated revenue disclosures. Revenue from our commercial segment totaled $1.79 billion, an 18% year-over-year increase from $1.52 billion in 2024. Our commercial segment is comprised of what we previously disclosed as CoStar and LoopNet, which also includes Domain's Commercial Marketplace, Information Services, Ten-X, BizBuySell, and Matterport. Ten-X, BizBuySell, and Matterport were previously included in other revenue. The 2025 acquisitions of Matterport and Domain contributed around 10 percentage points of this 18% revenue growth.
Revenue from our residential segment totaled $1.46 billion, a 20% increase year-over-year, with an organic growth rate of 12%. The residential segment includes Apartments.com, Homes.com, OnTheMarket, Land.com, and the residential revenue from Domain. Here's a breakdown of our revenue by product that is consistent with our prior guidance. Apartments.com revenue grew 11% for both the fourth quarter and full year of 2025, in line with our expectations. We continue to see significant opportunity across all the Apartments.com TAMs, and saw a year-over-year rooftop growth of 18% to 89,275 at year-end 2025. We continue to invest in Apartments.com and expect to add an additional 50 salespeople in 2026, after adding nearly 100 in 2025.
Residential revenue was $108 million in the fourth quarter and $218 million for the full year of 2025, above the high end of our guidance estimate. As a reminder, this revenue grouping included Homes, OnTheMarket, and Domain Residential. Revenue in 2025 included a $95 million contribution from Domain's residential revenue, with Homes.com delivering an impressive 63% year-over-year growth rate. CoStar revenue grew 9% for the fourth quarter and 7% for the full year of 2025. This was at the high end of our guidance and a fantastic result as we are emerging from the worst commercial real estate crisis in recent memory. CoStar rep productivity increased every quarter in 2025 as this team delivered its highest sales year since 2022.
At 94%, CoStar also saw its highest renewal rate since Q4 2022, with CoStar Debt Solutions and STR posting strong year-over-year growth. We are extremely excited about CoStar's pending product launches as we look to expand CoStar Debt Solutions capabilities into origination workflow solutions, expand STR's financial reporting modules, and launch the groundbreaking lease benchmarking product. LoopNet revenue increased 17% in the 4th quarter and 11% for the full year of 2025, also at the high end of our guidance. Excluding the impact from the acquired Domain commercial marketplace revenue, LoopNet grew 11% for the quarter and 9% for the year. LoopNet delivered its highest ever sales year in 2025, and we expect to continue that momentum throughout 2026 as we create the only pan-European CRE market solution and launch LoopNet in Australia.
Revenue from information services increased 15% for the fourth quarter and 19% for 2025, in line with our guidance. We are excited about the combination of Visual Lease and Real Estate Manager as we drive synergies across the combined platform, launch new products in 2026, and integrate these businesses into CoStar's unified tech platform, combining market data and analytics with applications for occupiers of real estate. Importantly, AI will feature prominently as we use it to extract rents, lease terms, and other data from leases to create benchmark solutions, and we will also provide this functionality to our customers for automated lease abstraction and audit purposes.
As you can see in the disaggregated revenue tables in the earnings release, the information services revenue has now been incorporated into CoStar revenue as we migrate these businesses into the CoStar platform, as we successfully did with STR. Other revenue was $75 million for the fourth quarter and $272 million for the full year of 2025, above the high end of our guidance. This positive result reflects better than expected performance from Matterport, camera sales and capture services revenue. Company-wide, we delivered $7 million of net income in 2025, which is $25 million above the high end of our guidance range. Our full year adjusted EBITDA of $442 million also exceeded the high end of our guidance by $17 million.
Our sales force at year-end was 2,175 people, which increased by nearly 800 in 2025, including the addition of 185 reps from our 2025 acquisitions. The majority of the increase was concentrated in our Homes.com residential business, which increased by more than 400 reps in the year. We expect to continue growing most of our sales forces in 2026, with a particular emphasis on growing the LoopNet and Matterport teams. Our contract renewal rate was 89% in the fourth quarter of 2025, and customers who have been subscribers for five years or longer have a 95% renewal rate. Subscription revenue on annual contracts was 71% for the fourth quarter of 2025. Domain does not operate using annual subscriptions, which has reduced this metric by seven percentage points.
Our other brands have remained relatively consistent with their subscription metrics. For full year 2025, we delivered $308 million of net new bookings, a record for CoStar and 23% higher than 2024. Net new bookings for the fourth quarter were $75 million, a 42% year-over-year increase. During 2025, we completed our $500 million share buyback program, announced in February 2025 and repurchased 7.1 million shares. We also recently announced that our board has authorized a new $1.5 billion share repurchase program.
We expect to repurchase a total of $700 million worth of shares in 2026. We plan to execute an accelerated share repurchase this quarter to repurchase $500 million worth of shares, followed by $200 million of open market repurchases throughout the rest of 2026. For 2026, we are affirming the guidance we provided on January 7th. Specifically, we expect revenue of $3.78 billion-$3.82 billion, implying an annual growth rate of 16%-18%. First quarter of 2026 revenues is expected to range from $890 million-$900 million, representing an increase of 22%-23% year-over-year at the midpoint.
We are also affirming our 2026 full year adjusted EBITDA guidance range of $740 million-$800 million, reflecting an adjusted EBITDA margin of 20%-21%. First quarter 2026 adjusted EBITDA is expected to range from $95 million-$115 million. Our adjusted EBITDA margins are expected to increase by roughly five percentage points each quarter throughout 2026. I want to say that again. Our adjusted EBITDA margins are expected to increase by roughly five percentage points each quarter throughout 2026. This margin expansion during the year reflects the timing of our marketing campaigns, which are heavily weighted to the first half of the year, as well as the seasonality of revenue from Domain.
As an aside, I would suggest you review 2024 and 2025 quarterly adjusted EBITDA numbers and margins, where you will see a similar seasonality pattern of rising margins throughout the year. For additional context on first quarter guidance, our marketing expenses tend to be the highest in the first and second quarters of the year, and 2026 should follow that same pattern. Events such as the Super Bowl, Winter Olympics, and the successful launch of Homes AI, drive spend earlier in 2026. Additionally, Domain revenue is seasonally lower in the first quarter as Domain comes off its high selling season. As a point of reference, based on current exchange rates, revenue for Domain has dropped an average of $14 million sequentially from Q4-Q1 over the past two years.