The company's outlook and expectations are based on current beliefs and assumptions. Our second quarter 2026 financial results marked a profitability inflection point for CoStar Group as adjusted EBITDA more than doubled year-over-year to $184 million. We generated $925 million of revenue in the second quarter, an 18% increase year-over-year. We held our increase in operating costs to just 2% year-over-year, all while continuing to invest in numerous long-term growth initiatives.
We expect to deliver the highest full-year adjusted EBITDA in CoStar Group's history in 2026, and we're confirming our full-year guidance range of $780 million-$820 million. Along the way, we expect to deliver two consecutive quarters of our highest ever adjusted EBITDA. Our commercial real estate business generated $481 million of revenue in Q2, an increase of 8% year-over-year, and it generated adjusted EBITDA of $172 million, up 7% year-over-year. CoStar revenue was $337 million, up 9% year-over-year, and net new bookings accelerated up 24%.
That subscriber base creates a powerful demand for commercial property sale and lease listings, and it makes the platform extremely valuable to the brokers and owners who list with us. Overall, commercial revenue accelerating growth was partly offset by Ten-X, where we have been restructuring the business for future growth and cost control, and it enabled us to reduce costs by $7 million year-to-date. Going forward, Ten-X will be separated from LoopNet with dedicated sales, marketing, and leadership to more effectively drive growth. For our third CoStar product launch in Q2, we launched public record search in the U.K., providing extensive transparency into 6.9 million freehold and leasehold ownership titles and 6.8 million properties and parcel groups.
| Metric | Period | Current guidance |
|---|---|---|
| Revenue | Q3 2026 | $935M-$945M (+13% YoY at the midpoint) |
| Adjusted EBITDA | Q3 2026 | $190M-$210M (21% margin, ~700 bps above Q3 2025) |
| Adjusted EPS | Q3 2026 | $0.31-$0.34 (assumes 403M weighted-average shares) |
| Revenue | FY2026 | Revised to $3.715B-$3.755B (+15% YoY at the midpoint) |
| Adjusted EBITDA | FY2026 | Affirmed $780M-$820M ($30M higher at the midpoint than February guidance) |
| Adjusted EPS | FY2026 | Affirmed $1.32-$1.39 ($0.08 / 6% higher than February) |
| Metric | YoY | Note |
|---|---|---|
| Total revenue | +18% to $925M | 61st consecutive quarter of double-digit growth, led by residential (+33%) and steady commercial (+8%) growth. |
| Adjusted EBITDA | +116% to $184M | Profitability inflection driven by ~2% cost growth, personnel-cost actions, operating efficiencies and early AI benefits; 20% margin, up ~900 bps. |
| Commercial revenue | +8% to $481M | CoStar +9% and LoopNet +14% growth, partly offset by lower Ten-X transaction volume; commercial adjusted EBITDA $172M (36% margin). |
| Residential revenue | +33% to $444M | Strength from Domain, Apartments.com and Homes.com; segment reached its first-ever positive adjusted EBITDA of $12 million. |
| Apartments.com revenue | +9% to $318M | Paid properties up 12% to ~93,000 with 99% monthly renewal, offset by ~3.6% lower ARPU from mix shift to smaller communities. |
| Net income | +817% | Revenue growth combined with tight cost control; EBITDA up 441% year over year. |
| Net new bookings | -26% (to $69M, +3% QoQ) | Homes.com sales-force optimization, Ten-X restructuring and Apartments competition weighed on bookings. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Profitability inflection and cost discipline | Heavy investment phase in Homes.com and marketplaces | Pivot to committing to EBITDA targets over pure revenue growth; ~$100M taken out of the 2026 expense base, op costs +2%, and a 20% adjusted EBITDA margin reached a quarter early. | — |
| Apartments.com competition and pricing integrity | Dominant multifamily marketplace | A competitor is discounting aggressively amid elevated multifamily vacancy; CoStar is holding price on the strength of a ~2.5x lead-to-lease conversion advantage, with June the third-best gross-sales month ever. | — |
| Homes.com sales-force strategy | Rapid build of a large centralized inside-sales team in Richmond | Shift toward higher-productivity field sales (about 2x inside-sales productivity), headcount cut 21% sequentially while delivering similar bookings, with depth advertising as a new revenue driver. | — |
| AI economics | Early AI deployment | AI cost savings currently exceed incremental token costs; 2026 token consumption is running under budget, with proprietary-data 'expert model' content seen as a high-gross-margin opportunity and coding efficiencies from LLMs. | — |
| International expansion | Europe integration | Launched CoStar in France (290,000+ properties) and U.K. public-record search (6.9M titles), with Australia launch targeted for H2 2026; LoopNet Australia and Australia expansion prioritized for margin. | — |
| CFO transition | Chris Lown as CFO | Chris Lown departs for Allstate; Robin Rossmann, who cut ~$50M (25%) from the European cost structure while growing double digits, promoted to CFO. | — |