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Zillow earns profit, no thanks to iBuying

The company's venerable agent advertising program is keeping Zillow in the black, despite iBuying losses

Rich Barton - HW+
Zillow CEO Rich Barton

New quarter, same story. Zillow makes money through agents advertising on its website. It loses money via buying homes for cash and then reselling them.

Add it up and the Seattle listings-and-iBuying giant on Wednesday reported $9.6 million in net income for the second quarter of 2021, and $1.3 billion in revenue.

The figures compare favorably to the second quarter 2020 – Zillow posted an $84 million net loss and $768 million in revenue back then – but April through June of 2020 marked the housing market’s COVID-induced nadir.

By contrast, Zillow posted $52 million in net income for the first quarter, and $1.2 billion in revenue in the first quarter of 2021. Zillow sold 2,086 homes through Zillow Offers (Zillow’s iBuying business) in the second quarter. The instant homebuying program netted 1,975 sales in the first quarter.

Zillow’s steady, if unspectacular bottom-line contrasts with the company’s enviable popularity and stated ambitions. Zillow’s filing with the Securities and Exchange Commission reported 228 million unique monthly visitors to its U.S. home listings site. The company also reported having 6,420 full-time employees as of June 30, which is a 14% surge in employee headcount within the last six months.

During Wednesday’s earnings call, Zillow CEO Rich Barton made mention of the company’s investment in “research and development” and said that employees are drawn to Zillow’s new “cloud-based” headquarters.

Barton said it was nothing less than a historic time for the housing market. There is a “great reshuffling” with many people’s homes no longer being tethered to their company office, millennials keep entering the homebuying market, and there’s persistently low mortgage interest rates….. (article continues on HousingWire.com)

This article was originally published by HousingWire. The full article is available on HousingWire.com for HW+ Members.

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