Q1 2025 CoStar Group Inc Earnings Call

Operator: Good day and thank you for standing by.

Good day and thank you for standing by welcome to the Q1 2025 Costar Group earnings Conference call. At this time all participants are in a listen only mode. Please be advised that today's conference is being recorded after the speaker's presentation there'll be a question and answer session.

Operator: Welcome to the Q1 2025 CoStar Group Earnings Conference Call. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded.

Operator: After the speaker's presentation, there will be a question and answer session.

Operator: To ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again.

Speaker Change: To ask a question. Please press star one one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again I would now like to hand, the conference over to your speaker today, Rich Simonelli head of Investor Relations.

Rich Ciminelli: I would now like to hand the conference over to your speaker today, Rich Ciminelli, Head of Investor Relations. Thank you so much, Operator, and hello and thank you all for joining us to discuss the first quarter 2025 results of the CoStar Group.

Rich Simonelli: Thank you so much operator, and Hello, and thank you all for joining us to discuss the first quarter of 2025 results of the Costar group.

Rich Ciminelli: Before I turn the call over to Andy Florence, CoStar CEO and founder, and Chris Lown, our CFO, I would 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 second quarter and full year of 2025 based on current beliefs and assumptions. Forward-looking statements involve many risks, uncertainties, 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 from time to time with the SEC, including our annual reports on Form 10-K and quarterly reports on Form 10-Q, included under the heading risk factors in those filings, as well as other filings with the SEC available at the SEC's website.

Speaker Change: Before I turn the call over to Andy Florance, Costar, CEO and founder Chris Lown, Our CFO I would like to review our Safe Harbor statement.

Speaker Change: Certain portions of the discussion today may contain forward looking statements, including the comp is company's outlook expectations.

Speaker Change: For the second quarter and full year of 2025 based on current beliefs and assumptions forward looking statements involve many risks uncertainties assumptions estimates and other factors that could cause actual results to differ materially from such statements important factors that can cause actual results to differ include but are not limited to.

Speaker Change: To those stated in Costar group's press release issued earlier today and in our filings from time to time with the SEC, including our annual reports on Form 10-K quarterly reports on Form 10-Q.

Speaker Change: Included under the heading risk risk factors in those filings as well as other filings with the SEC available at the Sec's website. All forward looking statements are based on the information available to Costar at the time of this call Costar assumes no obligation to update these statements whether as a result of new information future events or.

Rich Ciminelli: All forward-looking statements are based on the information available to CoStar at the time 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.

Speaker Change: Otherwise, except as required by applicable law.

Rich Ciminelli: Reconciliations of the most directly comparable GAAP measure of any non-GAAP financial measure discussed on this call are shown in detail in our press release issued earlier today, along with the definitions for this term, for these terms. Press release available on our website under the CoStarGroup.com under press release. As a reminder, today's conference call is being webcast and you're on it. And so the link is also available on our website under invest.

Speaker Change: Conciliation to the most directly comparable GAAP measure of any non-GAAP financial measure discussed on this call are shown in detail in our press release issued earlier today, along with definitions for this term for these terms press release available on our website under the Costar group Dot Com under press room.

Andy Florance: As a reminder, today's conference call is being webcast and you're on it and so the link is also available on our website under the investors. Please refer to today's press release on how to access the replay of this call and with that I'd like to turn the call over to our founder and CEO, Andy Florance Handy.

Rich Ciminelli: Please refer to today's press release on how to access the replay of this call.

Andrew Florance: And with that, I'd like to turn the call over to our founder and CEO, Andy Florence. Andy, good day, and thank you for joining CoStar Group's first quarter 2025 earnings call. We posted another strong quarter with Q1 2025 revenue coming in at $732 million, a 12% increase year over year. This was our 56th consecutive quarter of double digit revenue growth. Q1 revenue exceeded consensus and was at the top end of our guidance train . Adjusted EBITDA was $66 million, a 429% increase over Q1 2024. Adjusted EBITDA also exceeded consensus, and that was the top end of our guidance range.

Andy Florance: Good day and thank you for joining Costar group's first quarter 2025 earnings call.

Andy Florance: We posted another strong quarter with Q1 twenty-five revenue coming in at $732 million, a 12% increase year over year. This.

Andy Florance: This was our 56th consecutive quarter of double digit revenue growth.

Andy Florance: Q1 revenue exceeded consensus and it was at the top end of our guidance range.

Andy Florance: Adjusted EBITDA was $66 million, a 429% increase of Q1 over Q1 2024.

Andy Florance: Adjusted EBITDA also exceeded consensus and there was the top end of our guidance range.

Andrew Florance: We achieved a very strong 43% profit margin our Q125 commercial real estate and information marketplace businesses that includes CoStar Apartments, LoopNet, STR, Real Estate Manager, Land and Biz Buy, Sell and Aggregate coming in at a 43% profit margin. Company net new bookings were $56 million in the first quarter of 2025, up 6% sequentially from the fourth quarter of 2024. Our international businesses have achieved three consecutive quarters of all-time net new bookings, reaching over $5 million ARR in Q1 2025, representing 56% year-over-year growth. We add 130 million average unique visitors to our global websites in Q125 according to Google Analytics.

Andy Florance: We achieved a very strong 43% profit margin our Q1 'twenty five.

Andy Florance: <unk> real estate and information marketplace businesses that includes Costar apartments, Loopnet STR real estate manager land and best buy sell in aggregate coming in at a 43% profit margin.

Andy Florance: Company net new bookings were 56 million in the first quarter of 'twenty five up 6% sequentially from the fourth quarter of 'twenty four.

Andy Florance: Our international businesses have achieved three consecutive quarters of all time net new bookings, reaching over 5 million <unk> in Q1, 25, representing 56% year over year growth.

Andy Florance: We had 130 million average unique visitors to our global websites in Q1 25, according to Google analytics.

Andrew Florance: CoStar achieved $265 million in revenue in Q1 2025. Revenue was up 6% year-over-year, while annualized net new bookings reached their highest level since Q3 2023, generating 68% year-over-year growth. This was the fourth consecutive quarter of increasing net new bookings as we continue to generate strong sales with banks, institutional investors, and owners. STR's integration to CoStar contributed to its best quarter ever for net new bookings, up 17% year-over-year. This increase was driven by a significant rise in sales to owner-operators, who were 40% of STR's net new bookings in Q1. We grew the number of CoStar subscribers in Q1 17% year-over-year, largely driven by the migration of STR to the CoStar platform.

Speaker Change: Costar achieved 265 million in revenue in Q1, 'twenty five revenue was up 6% year over year, while annualized net new bookings reached their highest level since Q3, 'twenty three generating 68% year over year growth.

Speaker Change: This was the fourth consecutive quarter of increasing net new bookings as we continue to generate strong sales with banks institutional investors and owners.

Speaker Change: Str's integration of Costar contributed to its best quarter ever for net new bookings up 17% year over year.

Speaker Change: This increase was driven by a significant rise in sales to owner operators, who were 40% of Str's net new bookings in Q1.

Speaker Change: We grew the number of Costar subscribers in Q1, 17% year over year, largely driven by the migration of STR to the Costar platform.

Andrew Florance: CoStar for lenders, led by Mr. John Vecchione, achieved its best ever quarter of net new bookings, up 116% year over year. Today, LENDER is used by 385 institutions to manage risk on $1 trillion of CRA debt. In less than three years, it has achieved $80 million in annual revenue run rate. We have several product enhancements that will roll out in the course of the next few years that can take the total addressable market for LENDER well above $1 billion. CoStar remains a mission-critical tool for our clients across all segments. Logins to CoStar were up 21% year-over-year, and our subscribers averaged 100 million activities each month, the highest level of activity in the past nine quarters.

Speaker Change: Costar for lenders.

Speaker Change: Led by Mr. John Vecchione achieved its best ever quarter of net new bookings up 116% year over year.

Speaker Change: Today lenders used by 385 institutions to manage risk on one trillion of CRE debt.

Speaker Change: In less than three years, it has achieved $80 million in annual revenue run rate.

Speaker Change: We have had several we have several product enhancements that will rollout in the course of the next few years that can take the total addressable market for lender well above a $1 billion.

Speaker Change: Costar remains a mission critical tool for our clients across all segments logins to Costar were up 21% year over year, and our subscribers averaged 100 million activities. Each month, the highest level of activity in the past nine quarters, our quarterly renewal rate remains strong at 92%.

Andrew Florance: Our quarterly renewal rate remains strong at 92%.

Andrew Florance: During the past few years and through today, we're operating in one of the worst commercial estate environments in decades. Liggett Investment Grade Office, although absorption is improving, we're still seeing historic high vacancy rate of about 16%. Real asking rents of $36.64 sit at a 30 year low. Real sales price per square foot is a decadal low of $257 per square foot . Market cap rates are at a high point of 9.17%. Sales volume while recovering is about one-third of normal levels. In industrial, we're seeing record lows for absorption and a 6% year-over-year decline in real asking rent.

Speaker Change: During the past few years and through today, we're operating in one of the worst commercial state environments in decades.

Speaker Change: Again investment grade office, although absorption is improving we're still seeing historic high vacancy rate of about 16%.

Speaker Change: Real asking rents of $36 64 sit at a 30 year low real.

<unk> sales price per square foot is a decade low of $257 per square foot.

Speaker Change: Market cap rates are at a high point of $9 one 7%.

Speaker Change: Sales volume are recovering as about one third of normal levels in industrial we're seeing record lows for absorption and a 6% year over year decline in real asking rents.

Andrew Florance: In retail, real asking rents are 10-year lows.

Speaker Change: In retail real asking rents are 10 year lows.

Andrew Florance: But I want to be clear, we see clear signs that the cycle is improving. Vacancy rates have hit their zenith and are beginning to fall. Availability rates have fallen 60 basis points. Sublet rents are beginning to rise. We expect that as market conditions improve over the next few years, the headwinds we've experienced will shift to tailwinds and CoStar will return to double-digit growth.

Speaker Change: But I want to be clear, we see clear signs of the cycle's improving vacancy rates have hit their zenith and are beginning to fall availability rates have fallen 60 basis points sublet rents are beginning to rise we expect that as market conditions improve over the next few years the headwinds we've experienced will shift to <unk>.

Speaker Change: <unk> and Costar will return to double digit growth.

Andrew Florance: LoopNet turned in an outstanding quarter as annualized net new bookings skyrocketed 200% year-over-year. This was LoopNet's highest quarter of annualized net new bookings since Q3-22. In the quarter, per rep productivity was twice as high as Q1-24. This great sales performance was a result of changing our go-to-market sales strategy. Our sales team is focused on selling a broad subscription package to owners and brokers to get all their properties on the platform, rather than focusing on selling a few high-value signature ads that only address a small portion of the portfolio. Clients begin their search online, and LoopNet's the largest commercial estate marketplace in the world, so it's far more valuable to the owner to have exposure for all their properties rather than have robust exposure for one or two of their properties.

Speaker Change: Loopnet turned in an outstanding quarter as annualized net new bookings skyrocketed, 200% year over year.

Speaker Change: This was loopnet its highest quarter of annualized net new bookings since Q3 'twenty two.

Speaker Change: In the quarter per Rep productivity was twice as high as Q1 dollars 24.

Speaker Change: This great sales performance was a result of changing our go to market sales strategy.

Our sales team is focused on selling a broad subscription package to owners and brokers get all their properties on the platform rather than focusing on selling a few high value signature ads that only address a small portion of the portfolio.

Speaker Change: <unk> begin their search online in Loopnet as the largest commercial state marketplace in the world. So it's far more valuable to the owner to have exposure for all their properties rather than have a robust exposure for one or two of their properties.

Andrew Florance: The strategy will grow the number of paid properties on the platform, which increases the choice available on LoopNet for consumers and gives our sales team the opportunity to upsell silver ads to signature depth ads in the future. We're now also implementing asset based pricing as silver ads come up for renewal. Our renewal rates on these ads remain strong at 97% as our customers understand it is important to tie the price of any given loop net add to the value of the property being advertised. Our pricing will reflect that a billion-dollar, five-star office building in Manhattan derives more value from LoopNet than does a $100,000, two-star retail building in Montana.

Speaker Change: This strategy will grow the number of paid properties on the platform, which increases the choice available.

Speaker Change: On Loopnet for consumers and gives our sales team the opportunity to upsell silver ads to signature depth ads in the future.

Speaker Change: We're now also implementing asset based pricing as silver ads come up for renewal are renewal rates on these ads remained strong at 97% as our customers and understand it is important to tie the price of any given loopnet add to the value of the property being advertised.

Speaker Change: Our pricing will reflect that $1 billion five star office building in Manhattan derive more value from Loopnet than does $100000 to star retail building in Montana.

Andrew Florance: Ultimately, it's our goal to implement asset-based pricing across all ad tiers on both new sales and renewals. CoStar real estate manager and visual lease attained annualized subscription revenue growth nearing double digits.

Speaker Change: Ultimately is our goal to implement asset based pricing across all AD tiers on both new sales and renewals.

Speaker Change: Costar real estate manager and visual lease attained annualized subscription revenue growth nearing double digits. In Q1 2025, we move forward with the consolidation of leadership at operations across the brands positioning the leases businesses for integration of the greater Costar data offering.

Andrew Florance: In Q1 2025, we move forward with a consolidation of leadership and operations across the brands, positioning the leases businesses for integration in the greater CoStar data offering. This combined with other identified cost savings resulted in 50% year over year EBITDA growth for the combined brand. For more information visit www.costar.com Both brands continue to take market share from lease management competitors, many of whom are falling short on product innovation and focus on customers. The Lisa's product team is now focused on combining the value of its portfolio management applications with CoStar's data and analytics Matterport and LoopNet offerings to create an unrivaled solution for occupiers for real estate.

Speaker Change: This combined with other identified cost savings resulted in 50% year over year EBITDA growth for the combined brands.

Speaker Change: Both brands continue to take market share from lease management competitors.

Speaker Change: Many of whom are falling short on product innovation and focus on customers.

Speaker Change: The leases product team is now focused to combine the value of its portfolio management applications with Costar as data and analytics matter port in Loopnet offerings to create an unrivaled solution for occupiers for real estate.

Andrew Florance: CoStar continues to develop a data set of leases from both anonymized customer data from the lease brands and publicly available sources like the SEC and UK Land Registry, with the goal of providing full transparency on rent concessions and tenant improvements to real estate professionals. Q1 brought additional growth of customers electing to share data on aggregate and anonymized space. For the quarter, Land.com net new bookings increased 58%. Land.com continues integrating with Homes.com. Today, over 8,000 Homes.com members are syndicating over 22,000 applicable listings to Land.com. Soon, Land.com members will receive a similar benefit on Homes.com, increasing value and opportunities for both sites.

Speaker Change: Saar continues to develop a dataset of leases from both Anonymised customer data from the lease brands and publicly available sources like the FCC in UK land registry with a goal of providing full transparency on rent concessions and tenant improvements to real estate professionals Q.

Speaker Change: Q1 brought additional growth of customers electing to shared data on an aggregate and optimized basis.

Speaker Change: For the quarter land Dot com net new bookings increased 58% land dotcom continues integrating with homes dotcom today over 8000 homes Dot com members are syndicating over 22000 applicable listings to land dot com soon.

Speaker Change: Land Dot com members will receive a similar benefit on homes dot com, increasing value and opportunities for both sites.

Andrew Florance: In mid-March, FarmerMac released the FarmerMac Farmland Price Index, powered by our recently acquired acre value. Farmer Mac said the introduction of the FPI marks a significant advancement in tracking farmland price trends with greater precision and timeliness. We agree and look forward to providing greater, more timely insight into farmland markets. Business by sale revenue reached $8.7 million in the first quarter, representing a 10% increase year over year. Net new bookings increased 85% year over year, driven by strong growth in both business owner and business buyer subscription. Subscription revenue from BizBuySellEdge, which offers entrepreneurs advanced tools and market insights, grew 48% year-over-year.

Speaker Change: In mid March Farmer, Mac released the farmer Mac's farm land price index powered by our recently acquired acreage value.

Farmer Mac said the introduction of the FBI marks a significant advancement tracking farm land price trends with greater precision and timeliness we.

Speaker Change: We agree and look forward to providing greater more timely insight into farmland markets.

Speaker Change: BS VI sell revenue reached $8 7 million in the first quarter, representing a 10% increase year over year net.

Speaker Change: Net new bookings increased 85% year over year, driven by strong growth in both business owner and business spire subscriptions.

Description revenue from best buy sell edge, which offers entrepreneurs advanced tools and market insights grew 48% year over year buyer.

Andrew Florance: Buyer demand continues to strengthen, with website visits up 22% and lead volume increasing 33% year-over-year. Apartments.com turned in another strong quarter with revenue of $282 million, an increase of 11% over Q1-24. Department.com sales team was very active in the first quarter. They conducted over 166,000 quality interactions with clients and prospects in the quarter and increased their face-to-face meetings by 65% year over year. The increase in quality interactions is paying off as we added 4,300 new communities in Q1, the most properties we've added to apartments.com in a single quarter in almost 10 years. We're benefiting from the shutdown of Redfin of their rent period business as we target those properties that were formerly on rent period, not apartments.

Speaker Change: Buyer demand continues to strengthen with website visits up 22% and lead volume increasing 33% year over year.

Speaker Change: Apartments Dot com turned in another strong quarter with revenue of $282 million, an increase of 11% over Q1 24.

Speaker Change: Apartment stocks com sales team was very active in the first quarter. They conducted over 166000 quality interactions with clients and prospects in the quarter and increase their face to face meetings by 65% year over year.

Speaker Change: The increase in quality interactions is paying off as we added 4300, new communities in Q1. The most properties we have added to apartments dot com in a single quarter in almost 10 years.

Speaker Change: We're benefiting from the shutdown of redfin of their rent period business as we target those properties that were formally on rent period not apartments.

Andrew Florance: We launched marketing campaigns to owners specifically comparing our traffic, leads, and leases to rent, period, with face-to-face follow-up with communities with much success. We now have 80,000 multifamilies on apartments.com. The sales team maintained a 94 net promoter score during the quarter.

Speaker Change: We launched marketing campaigns to owners, specifically, comparing our traffic leads and leases to rent period with face to face follow up with his communities with much success.

Speaker Change: We now have 80000 multifamily as unapproved on apartments Dot com.

Speaker Change: The sales team maintained a 94 net promoter score during the quarter.

Andrew Florance: We see a $2.6 billion opportunity in the 20-unit and above building space, and it is our intention to grow the sales team 23% this year to keep up with this potential. Since 2019, we've grown our apartments revenue 118%, but only grown our sales reps in production by 56%, so we'll continue to accelerate our salesforce growth to keep up with this opportunity. We've added 56 sales professionals so far this year, with an additional 24 sales professionals that started training this week. I'm especially excited to welcome our 37 new sales team members that have come to us from rent period.

Speaker Change: We see a $2 6 billion opportunity in the 20 unit above building space and is our intention to grow the sales team, 23%. This year to keep up with this potential since 2019, we've grown apartments revenue of 118%, but only grown our sales reps in production by 56%. So we'll continue.

Speaker Change: <unk> to accelerate our sales for our growth to keep up with this opportunity.

Speaker Change: We've added 56 sales professionals. So far this year with an additional 24 sales professionals that started training this week.

Speaker Change: Especially excited to welcome our 37, new sales team members that have come to us from rent period.

Andrew Florance: I believe that we have added more salespeople from rent period than Zillow did, despite Zillow spending a lot of money to acquire assets from Redfin. These individuals average 10 years of multifamily sales experience and are already producing good results. Our 2025 apartments.com marketing campaign is in full swing and features the most content we've ever developed to reach the largest audience possible. In Q1 our five new TV spots were featured in March Madness, the National Women's Soccer League, and for you NFL fans you probably saw us last week on the NFL Draft. Our campaign will also be featured throughout other host profile shows and during the Major League Baseball, NHL and NBA season.

Speaker Change: I believe that we have added more salespeople from rent period, then zillow did despite the zillow spending a lot of money to acquire assets from redfin.

Speaker Change: Individuals' averaged 10 years of multifamily sales experience and are already producing good results.

Speaker Change: Our 2025 apartments Dot Com marketing campaign is in full swing and features the most content we've ever developed to reach the largest audience possible in.

Speaker Change: In Q1, our five new TV spots were featured in March Madness, the National Women's Soccer League and for you NFL fans you probably saw last week on the NFL draft.

Speaker Change: Our campaign will also be featured throughout other high profile shows and during the.

Speaker Change: Major League baseball NHL and NBA seasons.

Andrew Florance: We have increased our paid search efforts in the first quarter and will continue to do so throughout the year to attract more potential runners to our advertisers' communities by generating five times more number one positions than Zillow in the top 50 U.S. rental markets. Our unaided awareness among apartment seekers remains higher than all of our competitors combined, at 65%, and our closest competitor is 30 percentage points below us. Among industry professionals, our unaided brand awareness is now at an all-time high of 86%, a 26% increase over 2024. Industry professionals tell us that delivering high-quality leads that convert to more leases is the most important thing we do.

Speaker Change: We have increased our paid search efforts in the first quarter and we'll continue to do so throughout the year to attract more potential renters to our advertisers communities by generating five times more number one positions in zillow in the top 50 U S rental markets.

Speaker Change: Our unaided awareness among apartment secrets remains higher than all of our competitors combined at 65% and our closest competitor is 30 percentage points below us.

Speaker Change: Industry professionals, our unaided brand awareness is now at an all time high of 86%, a 26% increase over 2024 <unk>.

Speaker Change: Industry professionals tell us at delivering high quality leads that convert to more leases is the most important thing we do in.

Andrew Florance: In 2025, a brand study conducted by GovX 47% of owners and operators surveyed said Apartments.com had a completely or very effective lease-to-lead conversion rate that's 38% more than Zillow's and 160% more than rent period. The Apartments.com network had 38 million average monthly unique visitors in the first quarter. ComScore has released their March data and has us ahead of Zillow in visits in March by 5%, with 90 million visits, and has the apartments network up 7% year over year for the first quarter, while Zillow is showing down 27% for the same period. Very importantly, our lead flow to our customers continues to increase and is up 17% year-over-year.

Speaker Change: In 2025 brand study a brand study conducted by Gov ex.

Speaker Change: 47% of owners and operators surveyed said apartments dot com had a completely or very effective lease to lease lead to lease conversion rate, that's 38% more than zillow at 160% more than rent periods.

Speaker Change: The apartments Dot Com network had 38 million average monthly unique visitors in the first quarter comp.

Speaker Change: Comscore has released their March data and has has had ahead of zillow and visits in March by 5% with 90 million visits and has the apartments network up 7% year over year for the first quarter, while zillow is showing down 27% for the same period.

Speaker Change: Very importantly, our lead flow to our customers continues to increase and is up 17% year over year.

Andrew Florance: According to the most recent analysis by Entrata, through March of this year, apartments delivered 1.8 times more leads than other rental networks. Apartments.com also delivers by far the highest quality of leads converting 2.7x better than other rental networks and ultimately delivers more leases than other rental networks, 5.1 times more to be exact. Our Apply Now leads, our highest converting lead type, are up 814% over Q1 of last year, as more and more properties enable this feature. In the first quarter, we added a record of a high of 142,000 single family rentals posted on the platform and assisted our independent owner clients by collecting $1.4 billion in rental prop payments.

Speaker Change: According to the most recent analysis by and Trotter through March of this year apartments delivered one eight times more leads and other rental networks apartments.

Speaker Change: Apartments Dot com also delivers by far the highest quality of leads converting 2.7 X better than other rental networks and ultimately delivers more leases than other rental networks five one times more to be exact.

Speaker Change: Our applied now leads our highest converting lead type are up 814% over Q1 of last year as more and more properties enable this feature.

Speaker Change: In the first quarter, we added a record high of 142000 single family rentals posted on the platform and.

Speaker Change: And assisted our independent owner clients by collecting one 4 billion in rental payments.

Andrew Florance: We continue to see success from the utilization of Matterport on our rental sites. with potential renters viewing Matterport's 53 million times in the quarter up 59% year-over-year. while spending 71% more time on listings detail pages with a Matterport. Apartments.com is also benefiting from the increased traffic on homes.com as apartments.com paid advertisers also get exposure over at homes.com's rental area.

Speaker Change: We continue to see success from the utilization of matter port on our rental sites.

Speaker Change: With potential renters viewing matter ports 53 million times in the quarter up 59% year over year.

Speaker Change: While spending 71% more time on listings detailed pages with a matter port.

Speaker Change: Apartments Dot Com is also benefiting from the increased traffic on homes Dot com as apartments Dot com paid advertisers also get exposure over at home's Dotcoms rental area.

Andrew Florance: Apartments.com, Canada revenue grew 350% year over year with all time highs in March for visitors, visits, and leads. According to recent data from DashIQ, Apartments.com now delivers more leads and leases than any other ILS in Canada.

Speaker Change: Apartments, Dotcom, Canada revenue grew 350% year over year with all time highs in March for visitors visits and leads according.

Speaker Change: According to recent data from Dash IQ apartments Dot com now delivers more leads and leases than any other ILS in Canada.

Andrew Florance: 14 months ago, CoStar Group launched the new homes.com with a marketing blitz at Super Bowl 58. The new homes.com offers a completely different business model than do competing US residential portals in the US. The new homes.com is based on the premise that the most important thing a portal can do is to market a property for sale. This is in harmony with all the most successful and highly profitable portals around the world outside the US, which are all based upon this market the property, not an agent lead gen business model.

Speaker Change: 14 months ago, Costar group launched the new homes Dot com with a marketing Blitz as Super Bowl 58 the.

Speaker Change: New homes Dot Com offers a completely different business model than do competing U S residential portals in the U S.

Speaker Change: The new homes Dot Com is based on the premise that the most important thing a portal can do is to market a property for sale. This is in harmony with all of the most successful and highly profitable portals around the world outside the U S.

Speaker Change: As you are all based upon this market the property not an agent lead Gen business model.

Andrew Florance: The legacy competing on profitable U.S. property portals are based upon lead diversion business models. These lead diversion models divert leads from the potential homebuyers away from the listing agent and into the hands of a buyer agent willing to split their commission with a portal. Our research shows that these lead diversion models are very unpopular with home sellers, buyers, and agents. These LEED diversion sites are not designed to solve for the most important task, which is to sell the home. The new homes.com is a clean fast site offering a wealth of valuable content on neighborhood schools that home shoppers cannot find a competing site.

Speaker Change: The legacy competing unprofitable U S property portals are based upon lead diversion business models. These Lee diversion models divert leaves from the potential home buyers away from the listing agent and into the hands of a buyer agent willing to split their commission with a portal.

Speaker Change: Our research shows that these Lee diversion models are very unpopular with home sellers buyers and agents. These lead diversion sites are not designed to solve for the most important task which is to sell the home.

Speaker Change: The new homes Dot com is a clean fast site offering a wealth of valuable content on neighborhood schools that home shoppers cannot find on competing sites.

Andrew Florance: Based upon a wealth of consumer and agent feedback, we believe that Homes.com offers a vastly superior user experience and is preferred by home shopping.

Speaker Change: Based upon our wealth of consumer and agent feedback, we believe that homes Dot com offers a vastly superior user experience and is preferred by home shoppers.

Andrew Florance: To build a massive audience for home sellers and listing agents, we launched one of the largest marketing campaigns ever in real estate. Using RPA, the same firm we successfully used to create the Apartments.com brand, we recruited talent like Dan Levy, Heidi Gartner, O. Morgan Freeman, Lil Wayne, and Jeff Goldblum to create memorable and effective spots for the new Homes.com. We have run 32,000 commercials and digital placements, generating approximately 80 billion impressions. In Q1 alone, we generated 6 billion brand impressions across many of the biggest events in America, including the Super Bowl, the College Football Championship, and March Madness.

Speaker Change: To build a massive audience for home sellers and listing agents, we launched one of the largest marketing campaigns ever in real estate using RPI. The same firm we successfully used to create the apartments dot com brand, we recruit talent like Dan Levy had a Gartner Oh, Morgan Freeman Little Wayne and Jeff Goldbloom to create memorable and effective.

Speaker Change: Spots for the new homes Dot com.

Speaker Change: We have run 32000 commercials and digital placements generating approximately 80 billion impressions in Q1 alone we generated 6 billion brand across Europe.

Speaker Change: Brand impressions across many of the biggest events in America, including the Super Bowl The College Football Championship in March Madness.

Andrew Florance: To be successful, for homes.com to be successful, home shoppers need to be aware of homes.com and have intention to use it. Our target audience to several hundred million home shoppers is massive. Before we launched in February 24, only 4% of that target audience when asked, top of mind, what home shopping websites can you think of replied homes.com. In 14 months of marketing campaign, we have steadily increased our unaid awareness nine times to 36%. So we're now at 36% unaid awareness. Early last year, unaid awareness surpassed Trulia. Last summer, we surpassed Redfin's unaid awareness. And last month, we crossed Realtor.com.

Speaker Change: To be successful Holmes dot com for homes that kind of be successful home shoppers need to be aware of homes Dot com.

Speaker Change: And have intention to use it our target audience of several hundred million home shoppers is massive.

Speaker Change: <unk> launched in February of 'twenty for only 4% of that target audience. When asked top of mind, what home shopping websites can you think of replied homes Dot com.

Speaker Change: In 2014 months of marketing campaign, we have steadily increased our unaided awareness nine times to 36%. So we're now at 36% unaided awareness early last year unaided awareness.

Speaker Change: Surpassed trulia last summer, we surpassed redfin unaided awareness and last month, we crossed realtor dot com.

Andrew Florance: When we began, Zillow was 64 points above our unaid awareness. We've closed the gap to 24 points and are still improving. Our unaid intention, or the percentage of people surveyed that say they intend to use our site, has grown from single digit to 26%. We've also crossed Realtor, Redfin, and Trulia on unaid intent. Zillow and Realtor have been trending down while we've been growing.

Speaker Change: We began zillow was 64 points above our unaided awareness, we've closed the gap to 'twenty four points and are still improving.

Speaker Change: Our unaided intention or the percentage of people surveyed that say they intend to use our site has grown from single digit to 26%. We've also crossed realtor redfin and Trulia and unaided intent zillow.

Zillow and realtor had been trending down while we've been growing.

Andrew Florance: I have consistently set the expectation that building a B2C brand takes 3 to 5 years. To reach this level of unaided awareness and unaided intent in an audience of hundreds of millions in 14 months is excellent progress. I feel that over the next two to four years, we can take a solid and very valuable leadership position in the industry. With a superior product and aggressive marketing campaign and both growing unaided awareness and intent, we're seeing very strong audience and traffic growth on the Homes.com network. In just 14 months, we've built a Q124 audience of 104 million average monthly unique visitors.

Speaker Change: I have consistently set the expectation that building a b to C brand takes three to five years to reach this level of unaided awareness in unaided intent and an audience of hundreds of millions in 2014 months is excellent progress.

Speaker Change: I feel that over the next two to four years, we can take a solid and very valuable leadership position in the industry.

Speaker Change: With a superior product and aggressive marketing campaign, and both growing unaided awareness intent, we're showing very strong audience and traffic growth in the home Satcom network in just 14 months, we've built a Q1 'twenty four audience of 104 million average monthly unique visitors.

Andrew Florance: That's according to Google Analytics. This now makes the homes.com network one of the top two residential portals based upon monthly unique visitors according to the latest available public securities filings of our peer portals. or Near Peer Portals. We remain well ahead of Redfin and Realtor.com's traffic. With such a wide lead over these two, we've shifted our traffic acquisition strategy away from pure volume to targeting quality engaged traffic. Our bounce rate has approved 45 percentage points, our session duration is up 200%, and the number of page visits per visit has more than doubled. We're monetizing homes.com by selling memberships to agents giving their listings priority placements on homes.com which brings more buyer views more leads and on average enables them to sell the property faster and for more money.

Speaker Change: That's according to Google analytics. This now makes the homes Dot Com network one of the top two residential portals based upon monthly unique visitors. According to the latest available.

Speaker Change: Public securities filings of our peer portals.

Speaker Change: Or near peer portals, we remain well ahead of redfin and realtor dot coms traffic with such a widely over these two we've shifted our traffic acquisition strategy away from pure volume to targeting quality engaged traffic.

Speaker Change: Our bounce rate is approved 45 percentage points, our SaaS session duration is up 200% and the number of page visits per visit has more than doubled.

Speaker Change: We're monetizing homes dot com by selling memberships to agents given their listings priority placements on homes Dot com, which brings more buyer views more leads and on average enables them to sell the property faster and for more money.

Andrew Florance: Members listings sort to the top of their market, generally the first page where 90% of all buyers click through to listings. We present their listings with our neighbor the school content on competing listings and suggestion emails in our homepage. With a billion visits to homes.com in the past 12 months, we have unique insights in the market to buy a new home. We retarget members listings across thousands of websites to keep their listings top of mind. We also provide members with a Matterport and floor plan for their listings so that potential buyers can tour their listings 24-7.

Speaker Change: Members listing sort to the top of their market generally the first page, where 90% of all buyers click through the listings.

We present their listings with our neighbor at the school content on competing listings and suggestion emails in our homepage.

Speaker Change: With a 1 billion visits to homes Dot com in the past 12 months, we have unique and sizes in the market to buy a new home, we re target members listings across thousands of websites to keep their listings top of mind.

Speaker Change: We also provide members with a matter port and floor plan for their listing so that potential buyers can toward their listings 24, 7%.

Andrew Florance: is a comprehensive digital real estate marketing package no one else has offered.

Speaker Change: Is a comprehensive digital real estate marketing package no one else is offering.

Andrew Florance: In a time where home sales are getting a little tougher to achieve, I think we're well positioned and in the right place at the right time of the cycle. One of the most important events for a real estate agent is the listing presentation where they meet with a home seller and try to win a listing to sell their home. Homes.com members use the marketing benefits we offer through membership to differentiate themselves from competing agents and win more listing presentations. We tracked the listing win rate advantage for members closely, and it's steadily climbing. And now member agents are winning 61% more listings than before membership.

Speaker Change: In a time, where home sales are getting a little tougher to achieve.

Speaker Change: I think we're well positioned in the right place at the right time of the cycle.

Speaker Change: One of the most important events for our real estate agent is the listing presentation, where they meet with a home seller and try to win a listing to sell their home.

Speaker Change: Homes Dot com members use the marketing benefits, we offer through membership to differentiate themselves from competing agents and win more listing presentations with.

Speaker Change: We track the listing win rate advantage for members closely and its steadily climbing and now remember agents are winning 61% more listings than before membership.

Andrew Florance: Since the average value of winning a new listing is $15,000 and monthly membership fee is less than $500, the ROI is outstanding.

Speaker Change: Since the average value of winning a new listing is 15000 and monthly membership fee is less than 500.

Speaker Change: Roy is outstanding.

Andrew Florance: Last February, when we launched the new homes.com, we faced several hurdles. At launch, we only had a very small dedicated homes.com sales force of about 50 reps to sell to more than a million agents. We were offering a completely new value proposition to an aging customer base with very negative feelings about the business models of legacy real estate portals in our space. There was a bit of undeserved guilt by association. last May, just after launch. Our first Net Promoter score was disappointing at negative 42. Many early members did not understand our new value proposition and believe that homes.com, like Zillow, was a lead diversion site and were disappointed we were not diverting other agents leads to them to generate buyer agency business.

Speaker Change: Last February when we launched the new homes Dot Com, we faced several hurdles at launch we only had a very small dedicated homes dot com sales force of about 50 reps to sell to more than a million agents.

Speaker Change: We were offering a completely new value proposition to an agent customer base with very negative feelings about the business models of legacy real estate portals in our space.

Speaker Change: There was a bit of undeserved guilt by association.

Speaker Change: Last may just after lunch.

Speaker Change: Our first net promoter score was disappointing at negative 42.

Speaker Change: Many early members did not understand our new value proposition and believed at homes Dotcom like Zillow was a lead diversion site and we're disappointed we were not diverting other agents leads to them to generate buyer agency business that had never been our intent.

Andrew Florance: That had never been our intent. Our out of cycle early cancellation rate or failed payment at the time was high at 10% monthly. By late summer to early fall 24, our value proposition was better understood, and our NPS turned positive and moved into the good classification in the low single digits, and our early cancellation dropped significantly to 6%. In the last few months, our net promoter scores have been surging upwards and have reached 43, which is at the great classification and our early cancel or failed payment rate has dropped to between a quarter of a point and 2.5% per month.

Speaker Change: Our out of cycle early cancellation rate or failed payment at the time was high at 10% monthly by late summer early fall 'twenty for our value proposition was better understood and our NPS turned positive and moved into the good classification in the low single digits and our early cancellation dropped significantly.

Speaker Change: <unk>, 6%.

Speaker Change: In the last few months, our net promoter scores have been surging upwards and have reached 43, which is at the great classification and our early cancel or failed payment rate has dropped to between a quarter of a point and two 5% per month, great progress since we launched a completely new product concept and the.

Andrew Florance: Great progress.

Andrew Florance: Since we launched a completely new product concept in the U.S. in February 24, the early cancellation rate on 12-month contracts has plummeted 65 percent since last May. Our net promoter score has soared over 85 points to sit in the grade classification. Under the very strong leadership of our Senior Vice President of Sales, Andy Stearns. We've grown that small initial team of 50 dedicated sales reps 600% over the last 14 months to 314 reps in production. These reps with four months of production are turning in a steady $1,612 monthly net new revenue. which implies are straight lines to 232,000 in billings per average rep at the end of 12 months or 1.1 million billings per rep at the end of five years if you're counting.

Speaker Change: In February of 'twenty for the early cancellation rate of 12 month contracts has plummeted, 65% since last may our net promoter score has soared over 80 485 points to sit in a great classification.

Speaker Change: Under the very strong leadership of our senior Vice President of sales Andy Stern's we've.

Speaker Change: We've grown that small initial team of 50 dedicated sales reps, 600% over the last 14 months to 314 reps in production.

Speaker Change: Those reps with four months of production are turning in a steady 1006 hundred 12 monthly net new revenue.

Speaker Change: Which implies our straight lines to 232000 and billings per average rep. At the end of 12 months of $1 1 million billings per rep at the end of five years, if you're counting.

Andrew Florance: The sales force is still growing very rapidly with 64 more in training and with offers out to an additional 214 sales. In Q4 we anticipate we'll have 500 salespeople with four months of experience selling homes.com. That would suggest we could be adding over $800,000 a month new billing each month by Q4. We have recently optimized our pricing strategy to better align the price of our product with the stronger benefits listing agents and rental agents receive as Homes.com members. The first iteration of our pricing strategy determined membership price based on equal weighting of buyer and seller agency deals.

Speaker Change: The sales force is still growing very rapidly with 64 more in training and with offers out to an additional 214 salespeople.

Speaker Change: In Q4, we anticipate we'll have 500 salespeople with four months of experience selling homes dot com that would suggest we could be adding over 800000, a month new billing each month by Q4.

Speaker Change: We have recently optimized our pricing strategy to better align the price of our product with a stronger benefits listing agents and rental agents receive as homes Dot com members.

Speaker Change: The first iteration of our pricing strategy determined membership price based on equal weighting of buyer and seller agency deals now we largely pace price based on seller listings in.

Andrew Florance: Now we largely price based on seller listings. In April month to date, our demo to close rate is 56%. So something's going right there. This is the highest monthly gross rate I've ever seen for any CoStar brand. With one day left in April, the Dedicated Homes.com sales team is currently positioned to close 240,000 monthly net new bookings. They're still selling past some of the sales from the prior year that the general sales force did, but they're solidly into positive territory. This is the dedicated sales teams best net new bookings month to date, and a 420,000 positive swing from the prior month.

Speaker Change: In April month to date, our demo to close rate is 56%.

Speaker Change: So something is going right. There that's the highest monthly close rate of ever seen for any Costar brand.

Speaker Change: With one day left in April the dedicate homes Dot Com sales team is currently positioned to close 240000 in monthly net new bookings.

Speaker Change: They are still selling past some of the sales from the prior year that the general Salesforce did but they're solidly into positive territory. This.

Speaker Change: This is the dedicated sales teams best net new bookings month to date and a 420000 positive swing from the prior month.

Andrew Florance: With improving NPS scores, our projected cancellations for May are falling approximately 70%. At the same time, our gross sales are climbing as we bring on more salespeople and they gain experience.

Speaker Change: With improving NPS scores are projected cancellations for may are falling approximately 70%.

Speaker Change: At the same time, our gross sales are climbing as we bring on more salespeople and they gain experience.

Andrew Florance: I believe that by year end, our Homes.com sales team will be our largest and we'll be turning in the most net new revenue of any CoStar Group, any product there in CoStar Group with a regular 1 million net new months for Homestock. We recently released a new purchase option for homes.com called Boost, which is a marketing option for a single listing for agents with unpredictable income and not yet ready to commit to an annual membership. They can boost one listing via e-commerce, just like membership. Once boosted, their listing sorts the top of search results, receives a Matterport and is retargeted across the Internet.

Speaker Change: I believe that by year end, our homes dotcom sales team will be our largest and we'll be turning in the most net new revenue of any Costar group.

Speaker Change: Prior to any product area and Costar group with a regular 1 million net new months for homes Dot com.

Speaker Change: We recently released a new purchase option for homes Dot com called boost which is a marketing option for single listing for agents with unpredictable income and not yet ready to commit to an annual membership. They can boost one listing via ecommerce just like membership once boosted their listing source the top of search results for <unk>.

Speaker Change: As a matter of port and as re targeted across the internet.

Andrew Florance: This is a low risk purchase option for an agent because they can go into a listing presentation, use the boost as a differentiator, but they only have to pay for it when they win the listing and have offsetting commission revenue. From our perspective, Boots is a great way for agents to get their foot in the door and we will be funneling Boots purchases as leads into our sales team to call upon for up-sales to membership. We're also offering the Boost option directly to home sellers. These are home sellers with agents, but often home sellers want, you know, we've seen in Australia, it's really successful where home sellers regularly add marketing tailwinds to their home for sale, purchasing 10s of 1000s of dollars worth of boosts from portals to market their home for sale online.

Speaker Change: This is a low risk purchase option for an agent because they can go into a listing presentation used the boost is a differentiator, but they only have to pay for it when they when the listing and have offsetting commission revenue.

Speaker Change: From our perspective this is a great way for agents to get their foot in the door.

And we will be funneling boost purchases as leads into our sales team to call upon for Upsells to membership.

Speaker Change: We're also offering the boost option directly to home sellers.

Speaker Change: These are home sellers with agents, but often home sellers want.

Speaker Change: In Australia, it's really successful where home sellers regularly add marketing tailwind to their home for sale purchasing tens of thousands of dollars worth of boost from portals.

Speaker Change: To market their home for sale online.

Andrew Florance: We tested the boost option with home sellers and listing agents and focus groups in Southern California recently, the feedback was universally positive, with almost all participants saying they would purchase a boost for their home or listing at about the $500 price point.

Speaker Change: We tested the boost option with home sellers and listing agents in focus groups in southern California recently, the feedback was universally positive with almost all participants, saying they would purchase a boost for their home or listing.

Speaker Change: At about the $500 price point.

Andrew Florance: In July, we expect to launch a new Homes, Homes.com marketing offering for home builders. There's an attractive market for us to enter because new construction represents approximately 20% of all homes sold in any given year. Yet there's no great single place for a consumer to go and find all the available new communities. Building a site with full inventory of available new homes would be a very valuable option for both consumers and the industry, and it would allow Homes.com to capture a piece of the estimated $3 billion annual marketing spend by America's home builders. We've already secured listing feeds representing 60% of the total available inventory, and I expect this number will grow as we approach July.

Speaker Change: In July we expect to launch a new homes homes dot com marketing offering for homebuilders.

Speaker Change: Attractive market for us to enter because new construction represents approximately 20% of all homes sold in any given year yet.

Speaker Change: Yet there's no great single place for consumer to go and find all of the available new communities build.

Speaker Change: Building a site with full inventory of available new homes will be very valuable option for both consumers and the industry.

Speaker Change: And it would allow homestar com to capture piece the estimated <unk>.

Speaker Change: 3 billion annual marketing spend.

Speaker Change: By Americas Homebuilders.

Speaker Change: We've already secured listing feeds representing 60% of the total available inventory and I expect this number will grow as we approached July <unk>.

Andrew Florance: Initial feedback from builders has been overwhelmingly positive as we meet with them. Builders tell us they're thrilled that a portal is finally delivering a beautifully designed, robust new home search experience.

Speaker Change: Initial feedback from builders has been overwhelmingly positive as we meet with them builders tell us they're thrilled that a portal is finally, delivering a beautifully designed robust new home search experience.

Andrew Florance: We are carefully controlling expenses generally and with Homes.com specifically. In the first quarter, we released over $50 million in annualized savings, mostly through cost reduction initiatives in our Homes.com investment. Overall, we reduced headcount in the company by 423 in Q1.

Speaker Change: We are carefully controlling expenses generally and with homes dot com specifically in.

Speaker Change: In the first quarter, we realized over $50 million in annualized savings, mostly through cost reduction initiatives in our homes Dot com investment.

Speaker Change: Overall, we reduced head count in the company by 423 in Q1.

Andrew Florance: Zillow recently announced an aggressive new policy of permanently banning homes that have been privately marketed for over 24 hours. pretty aggressive With the post-NAR lawsuit industry changes around clear cooperation, no commingling rules, I believe that our lurid diversion competitors are getting anxious that brokers with more choice may increasingly choose to market their properties away from those lead diversion platforms. The home is not listed on Zillow. Zillow loses the opportunity to use the listing to sell her buyer agency leads and take 40% of the buyer agency commission. We're still for them is that if more and more listing agents stay off their platforms and the listing count will fall and they could lose audience and fall into a downward spiral, we view this move not only as anti-competitive, but also shows a bit of desperation.

Speaker Change: Zillow recently announced an aggressive new policy of permanently banning homes that had been privately marketed for over 24 hours.

Speaker Change: Pretty aggressive.

Speaker Change: With the post NAR lawsuit industry changes around clear cooperation no commingling rules I believe that our alert diversion competitors are getting anxious that brokers with more choice by increasingly choose to market their properties away from those lead diversion platforms.

Speaker Change: The home is not listed on Zillow zelle lose the opportunity to use the listing to seller buyer agency leads and take 40% of the buyer agent Commission.

Speaker Change: We're still for them is that if more and more listing agent stay off their platforms and the listing count will fall and they could lose audience and fallen to a downward spiral.

Speaker Change: We view this move not only as anti competitive but also shows a bit of desperation.

Andrew Florance: I authored an open letter last week to the industry making sure everyone was watching the power grab Zillow was attempting. My communication surprisingly reached an estimated 50 million impressions across email, LinkedIn, and earned media coverage. The reaction from agents was approximately 10 to 1 positive to us.

Speaker Change: I authored an open letter last week the industry, making sure anyone everyone was watching the power grabs zillow was attempting.

Speaker Change: My communication surprisingly reached an estimated 50 million impressions across E Mail Linkedin and earned media coverage. The reaction from agents was approximately 10 to one positive to us.

Andrew Florance: In those most recent focus groups, one agent said, well, everyone hates Zillow, buyers, sellers, agents, and brokers. The word that many use describes Zillow as predatory.

Speaker Change: And the most and those most recent focus groups one agent said well everyone hates.

Speaker Change: Hey, Zillow buyers sellers agents or brokers.

Speaker Change: That many use describes it as predatory.

Andrew Florance: Through the decades of mistreatment, agents are desperate for a viable alternative, and they now have one, Homes.com. My favorite quote of the evening was, Homes.com brings us a lot, and they're going to surpass Zillow very soon. The moderator asked where they're hearing that, and the agent replied by saying, quote, got everyone at my brokerage meetings, lawyers, brokers, commercial agents, everyone, end quote.

Speaker Change: The decades of MS treatment agents are desperate for a viable alternative and they now have one homes dot com.

Speaker Change: My favorite quote that evening was homesite com brings a whole lot and they're gonna surpassed zillow very soon.

Speaker Change: Moderator asked where theyre hearing that an agent replied by saying quote got everyone at my brokerage meetings lawyers brokers commercial reagents, everyone end quote.

Andrew Florance: At the end of the one year marks as we kicked off our sales efforts, I'm confident Homes.com is a winning product. We're seeing excellent momentum in sales.

Speaker Change: At the end of the one year marks as we kicked off our sales efforts I'm, calling from the home Satcom is winning product.

Speaker Change: We're seeing excellent momentum in sales if you look around the world a successful real estate portals that use our business model of marketing the real estate not lead diversion EBITA opportunity is really impressive.

Andrew Florance: If you look around the world at successful real estate portals that use our business model of marketing the real estate, not lead diversion, the EBITDA opportunity is really impressive. The EBITDA normalized to the size of the US GDP of market leaders like REA Group, Scout, Rightmove, Domain, Hemnet, and Edialista . for the United States ranges between 1 billion of potential EBITDA to 9 billion of potential EBITDA in the US, suggesting that that residential portal opportunity in the United States is a lot larger than the 75, 79 million adjusted EBITDA number one of our competitors turned in in 2024, about 100 times larger than that.

Speaker Change: The EBIT normalized the size of the U S. GDP of market leaders like <unk> group's scout right move domain Hamnett neither alastair.

Speaker Change: For the United States ranges between $1 billion of potential EBITDA to $9 billion of potential EBITDA in the U S, suggesting that that residential portal opportunity United States is a lot larger than the 70 579 million adjusted EBIT number one of our competitors turned in in 2020.

Speaker Change: For about 100 times larger than that.

Andrew Florance: on the market had a over the United Kingdom had another strong quarter 11 straight months we've seen net new bookings growth equivalent to 7.2 million annualized revenue We are delivering fantastic ROI to agents who subscribed on the market. Lead volume increased 17% year-over-year. We increased listings by 23% year-over-year. The audience is engaged as we saw page views and time on site grow by 99% and 81%, respectively, year-over-year.

Speaker Change: On the market had a over the United Kingdom had another strong quarter, 11th straight months, we've seen net new bookings growth equivalent to $7 2 million annualized revenue we.

Speaker Change: We are delivering fantastic ROI to Asia, So subscribed on the market lead volume increased 17% year over year, we increased listings by 23% year over year. The audiences engaged as we saw a page views and time on site grew by 99% and 81% respectively year over year.

Andrew Florance: In February 2025, we made an all cash offer for Domain Holdings, one of Australia's two largest real estate portals and one of the 10 largest real estate marketplaces in the world. The vein is very profitable growing and is in the market in a market with great dynamics for real estate portals with vendor or owner paid models. 2024 annual revenue was $250 million using today's conversion rate and EBIT of $88 million. Australia's real estate portals use the vendor paid advertising model, unlike the competing US portals, which have lead gen models for buyer agents. Australian portals generate revenue through marketing the real estate.

Speaker Change: In February 2025, we made an all cash offer for domain holdings, one of Australia's two largest real estate portals and one of the 10 largest real estate marketplaces in the world.

Speaker Change: The vein has very profitable growing and is in the market in a market with great dynamics for real estate portals with vendor owner paid models.

Speaker Change: 2024 annual revenue was $250 million in using today's conversion rate and EBITDA of $88 million.

Speaker Change: Australia is real estate portal is use the vendor paid advertising model. Unlike the competing U S portals, which have lead gen models for by our agents.

Speaker Change: Australia and portals generate revenue through marketing and real estate home sellers are regularly paying companies like domain and RGA anywhere from $3000 on up to $50000 to market their home for sale online and those would.

Andrew Florance: Home sellers are regularly paying companies like Domain and REA, anywhere from $3,000 on up to $50,000 to market their home for sale online. And those would be 5,000 Australian, 50,000 Australian.

That would be 5000, Australia and 50000, Australia.

Andrew Florance: One element, Domain, one element that from Domain that will benefit Homes.com and on the market is depth advertising. Similar to signature ads for Apartments.com and LoopNet, Domain offers four tiers of advertising that offer increasing levels of exposure as you move up their ad tiers by utilizing sort order, larger search placards, social notification, and retargeting. We will be adopting the best practices of Domain in the US and in the United Kingdom. We see numerous opportunities to create additional value for domain following the potential acquisition. Domain's majority owner today is a media business which historically under invests in the product.

Speaker Change: One element.

Speaker Change: The main one element that will from domain that will benefit homestyle comment on the market as depth advertising similar to the signature ads for apartments Dot com in Loopnet domain offers four tiers of advertising that offer increasing levels of exposure as you move up their AD tiers by utilizing sort order larger search placards social apps.

Speaker Change: Acacia re targeting we will be adopting the best practices of domain in the U S and into and in the United Kingdom.

Speaker Change: We see numerous opportunities to create additional value for domain following the potential acquisition.

Speaker Change: Domains majority owner today is a media business, which historically underinvested in the prop in the product.

Domains majority owner today is a media business, which historically underinvested in the prop in the product.

Andrew Florance: Simultaneously, REA Group's market dominance has not incentivized them to innovate and improve their product.

Speaker Change: Simultaneously <unk> group's market dominance is not incentivize a innovate improve their product both sites pellet comparison to the product we built with homes Dot com, we will bring what we've built in homes dot com to Australia, and the United Kingdom to win over consumers.

Andrew Florance: Both sites pale in comparison to the product we built with Homes.com. We will bring what we built in Homes.com to Australia and the United Kingdom to win over consumers.

Andrew Florance: Domain is also a strong entry point into Australia's commercial real estate market. They operate commercialrealestate.com.au, a top two CRE marketplace in Australia. With thousands of listings, we can migrate into LoopNet. Adding Australian listings to LoopNet would provide great value to multinational owners and brokers that list on LoopNet and the multinational tenants that are searching the site. Domain's inventory of commercial listings lays a strong foundation for building CoStar covering Australia. The board of domain is majority shareholder nine entertainment has backed our offer and we're in the process of process of conducting due diligence. Of course, there's no guarantee that our proposal will result in a transaction.

Speaker Change: Domain is also a strong entry point into Australia commercial real estate market. The outbreak commercial real estate Dot com au a top two CRE marketplace in Australia with thousands of listings, we can migrate into loopnet.

Speaker Change: Adding Australian listings to Loopnet will provide great value to multinational owners and brokers that list on loopnet and the multinational tensor searching our site to.

Domains inventory commercial listings lays a strong foundation for buildings Costar covering Australia.

Speaker Change: The board of domain as Mark Jarvi shareholder nine entertainment has backed our offer and we're in the process. The process of conducting due diligence of course, there's no guarantee that our proposal will result in a transaction.

Andrew Florance: We closed the acquisition of Matterport at the end of February and we have been longtime users of Matterport.

Speaker Change: We closed the acquisition of matter Port at the end of February and we have been longtime users amount of important I'm very excited to have the opportunity to work with RJ go spec in the entire matter for team on the next phase of their impressive journey.

Andrew Florance: And I'm very excited to have the opportunity to work with RJ, Gao Speck and the entire Matterport team on the next phase of their impressive journey. The Matterport technology will be an incredible asset for us. They have an impressive product roadmap which will benefit our entire ecosystem. At the end of March, Matterport had created digital twins for an astounding 54 billion square feet of space. Over the past four years, Matterport has increased total spaces under management by more than 20% annual and total square footage of over by over 30% each year.

Speaker Change: The matter Port technology will be an incredible asset for us they have an impressive product roadmap, which will benefit our entire ecosystem.

Speaker Change: At the end of March matter ported create digital twins for an astounding 54 billion square feet of space.

Speaker Change: Over the past four years matter Port has increased total spaces under management by more than 20% annual and total square footage of over by over 30% each year.

Andrew Florance: Our new goal is to reach a trillion square feet of digital twins. that requires 35% year over year growth. Their sales success was achieved with a small sales team, but mighty at 47.

Speaker Change: Our new goal is to reach a trillion dollars square feet of digital twins.

Speaker Change: That requires 35% year over year growth their sales success was achieved with a small sales team, but mighty a 47, we plan to growth both our R&D and sales team.

Andrew Florance: We plan to grow both their R&D and sales team. With Matterport technology combined with CoStar's global scale and reach, the future is bright for both companies.

Speaker Change: With matter Port technology, combined with Costar has global scale and reach the future's bright for both companies.

Andrew Florance: I want to close by doing something important, thanking our board members, Mike Klein, Chris Nassetta, and Laura Kaplan, who are concluding their service on the CoStar board. Through the years, they've offered excellent counsel and have been extremely valuable in helping us build CoStar Group into the global organization it is operating in 192 countries with a $34 billion market cap. Mike Klein and David Vonderman co-founded the business with me in 1987. I still marvel at Mike Klein mortgaging his house to invest most all of his net worth or maybe 150% of his net worth into a 22-year-old's startup concept.

Speaker Change: I want to close by doing some important banking our board members, Mike Klein Christmas setup, and Laura Kaplan, who are concluding their service on the Costar board through.

Speaker Change: Through the years, they've offered excellent counsel and have been extremely valuable and helping us build Costar group into the global organization is operating at 192 countries with a $34 billion market cap.

Speaker Change: Mike Kleine and David Bonderman Iqos. They co founded the business may in 1987.

Speaker Change: I still Marvel at my client Mortgaging his house to invest most all of his net worth or maybe 150% of his net worth into a 22 year olds startup concept.

Andrew Florance: Turns out he was a genius. He's a visionary and his support and counsel was matchless.

Speaker Change: Turns out he was a genius is a visionary and his support and counsel was matchless.

Andrew Florance: As part of the ongoing refresh of our board, we made some important announcements earlier this month. Louise Sams, who's been a CoStar board member since 2019, has been named chair of the board. She has strong international legal experience, having served as EVP and general counsel of Ternal Broadcasting System Inc. for nearly two decades and president for nearly a decade. Louise is currently the board chair of Princeton University, which I hear is a good place. She has been an impactful board member and is the perfect person to chair our board. I'm looking forward to working with John Beresford, Rachel Glasser, and Christine McCarthy.

Speaker Change: As part of the ongoing refresh of our board we made some important announcements earlier this month Louie.

Speaker Change: Louise Sam's who's been a Costar board member since 2019 has been named chair of the board. She has strong international legal experience, having served as EVP and General Counsel of Turner Broadcasting system, Inc. For nearly two decades and president for nearly a decade.

Speaker Change: Louise is currently the board chair of Princeton University, which a here's a good place.

Speaker Change: She has been impactful board member and is the perfect person to chair of our board.

Speaker Change: I'm looking.

Speaker Change: Forward to working with John Berisford, Rachel Glosser, and Christine Mccarthy, they bring a wealth of experience experience with strong track records at leading global companies Christy.

Andrew Florance: They bring a wealth of business experience with strong track records at leading global companies. Christine is a recognized corporate finance leader with over 30 years of experience, most recently a CFO of the Walt Disney Company. John is an accomplished executive who most recently served as president of S&P Global Ratings. Rachel has extensive market experience as the former CFO of Etsy and direct residential industry experience as the former CFO of Moving.

Speaker Change: Christine is a recognized corporate finance leader with over 30 years of experience. Most recently as CFO of the Walt Disney Company. John is an accomplished executive who most recently served as president of S&P Global ratings.

Speaker Change: Rachel has extensive market experience as the former CFO of Etsy and direct residential industry experience as the former CFO of moving.

Andrew Florance: I'll be chairing our new board's Capital Allocation Committee, and John Christie and Robert Musselwhite will also serve on the committee. The board established the committee to review and make recommendations to the board regarding the company's capital structure, capital allocation priorities, and financial targets. The committee's review will also focus on operating performance, including the setting of near-term, long-term financial targets for resource and capital allocation. The committee's charge is to continue the company's outstanding capital allocation track record as resulted in the company's outperforming 98% of the NASDAQ companies since our IPO.

Speaker Change: I'll be chairing a new boards capital allocation Committee and John Christine Robert Musselwhite will also serve on the committee.

Speaker Change: Board established the committee to review and make recommendations to the board regarding the Companys capital structure capital allocation priorities and financial targets.

Speaker Change: Committee's review will also focus on operating performance, including the setting of near term long term financial targets, we're resourcing capital allocation.

Speaker Change: The committees charges continue the company's outstanding capital allocation track record has resulted in the company's outperforming 98% of the NASDAQ companies since our IPO.

Christian Lown: And with my very brief remarks, I'm going to turn it over to Chris. Thank you, Andy. First quarter 2025 revenue grew 12% year over year to $732 million. Matterport contributed $15.9 million of revenue for the quarter, which represented one month of activity. Excluding the Matterport contribution, revenue is at the high end of our guidance and above consensus estimates. First quarter adjusted EBITDA came in at $66 million in a 9% margin, also exceeding consensus and the high end of our guidance range. The outperformance in adjusted EBITDA was primarily due to timing of marketing spend, lower personnel costs from cost-saving initiatives, and hiring timing.

Speaker Change: And with my very brief remarks, I'll turn it over to Chris well.

Chris Lown: Thank you Andy.

Chris Lown: First quarter 2025 revenue grew 12% year over year to $732 million.

Chris Lown: Madrepore contributed $15 $9 million of revenue for the quarter, which represented one month of activity.

Chris Lown: Excluding the Madhepura contribution revenue was at the high end of our guidance and above consensus estimates.

Chris Lown: First quarter adjusted EBITDA came in at $66 million and a 9% margin also exceeding consensus and the high end of our guidance range.

Chris Lown: Performance in adjusted EBITDA was primarily due to timing of marketing spend lower personnel costs from cost saving initiatives and hiring timing.

Christian Lown: Matterport contributed an adjusted EBITDA loss of $2.7 million for the first quarter stub period. Our commercial information and marketplace spans delivered healthy 43% profit margins in the first quarter.

Chris Lown: <unk> contributed an adjusted EBITDA loss of $2 $7 million for the first quarter stub period.

Chris Lown: Commercial information and marketplace spans delivered healthy 43% profit margins in the first quarter. This measure does not include our investments in homes Dot com on the market matter port.

Christian Lown: This measure does not include our investments at homes.com on the market matter. CoStar revenue grew 6% in the first quarter, in line with our guidance. Even considering what continues to be a difficult commercial real estate backdrop, CoStar net new bookings continue to improve and are now at the highest levels since the third quarter of 2023. While we do not anticipate some, I'm sorry, while we do anticipate some slight headwinds from government contract cancellations expected throughout 2025, we still expect CoStar revenue growth to remain at 6% in the second quarter, and we are maintaining our 6 to 7% revenue growth guidance for the full year.

Chris Lown: Costar revenue grew 6% in the first quarter inline with our guidance.

Chris Lown: Even considering what continues to be a difficult commercial real estate backdrop Costar net new bookings continue to improve and are now at the highest levels since the third quarter of 2023.

Chris Lown: While we do not while we do not anticipate some I'm sorry, while we do anticipate some slight headwinds from government contract cancellations expected throughout 2025, we still expect Costar revenue growth to remain at 6% in the second quarter, and we are maintaining our 6% to 7% revenue growth guidance for the full year.

Christian Lown: Apartments.com revenue grew 11% year-over-year in the first quarter, in line with our expectations. We refocused our sales plans this year to emphasize new rooftops, and we are seeing the benefits of this incentive structure with the considerable growth in our number of listed properties. The under 100 unit property cohort increased 19% year over year in the quarter. This addressable market is nearly four times the size of the over 100 unit property cohort. We expect to continue to penetrate the sub 100 property segment and, as such, we are maintaining our full year 2025 apartments.com revenue guidance of 11 to 12 percent.

Chris Lown: Apartments Dot com revenue grew 11% year over year in the first quarter in line with our expectations.

Chris Lown: We refocused our sales plans this year to emphasize new rooftops and we're seeing the benefits of this incentive structure with the considerable growth in our number of listed properties.

Chris Lown: The under 100 unit property cohort increased 19% year over year in the quarter.

Chris Lown: This addressable market is nearly four times the size of the over 100 unit property cohort.

Chris Lown: We expect to continue to penetrate the sub 100 properties segment and as such we are maintaining our full year 2025 apartments dotcom revenue guidance of 11% to 12%.

Christian Lown: For 2Q 2025, we expect multifamily revenue growth of 10%. LoopNet revenue grew 5% in the first quarter, also in line with our guidance. Importantly, we are building great momentum at LoopNet as it delivered its highest net new bookings quarter in nearly three years. We expect revenue growth to accelerate throughout the year, with 7% growth expected in the second quarter of 2025. We are increasing our guidance expectations for 2Q20 for 2025 and now expect revenue growth of 78% for the full year as growth accelerates throughout the year. Revenue from information services was $40 million in the first quarter.

Chris Lown: <unk> 2025, we expect multifamily revenue growth of 10%.

Chris Lown: Loopnet revenue grew 5% in the first quarter also in line with our guidance importantly, we are building great momentum at Loopnet as it delivered its highest net new bookings quarter in nearly three years, we expect revenue growth to accelerate throughout the year with 7% growth expected in the second quarter of 2025.

Chris Lown: We're increasing our guidance expectations for <unk> 'twenty for 2025, and now expect revenue growth of 7% to 8% for the full year as growth accelerates throughout the year.

Chris Lown: Revenue from information services was $40 million in the first quarter.

Christian Lown: Revenue growth for the second quarter and full year is expected to be in the 18 to 20% range. Visual Leases integration with real estate manager is well underway, and we're extremely excited about the lease benchmarking product and expect a beta launch by year end. Other revenue, which now includes Matterport, was $45 million for the first quarter, with Matterport contributing $15.9 million. We expect other second quarter revenue of approximately $70 million with Matterport revenue of approximately $40 million. We expect full year revenue to increase by 100 to 115% to $270 to $280 million, with Matterport contributing $135 to $140 million.

Chris Lown: Revenue growth for the second quarter and full year is expected to be in the 18% to 20% range.

Chris Lown: <unk> integration with real estate managers, well underway and we are extremely excited about the least benchmarking product and expect a beta launch by year end.

Chris Lown: Other revenue, which now includes matter pork was $45 million for the first quarter with madrepore contributing $15 $9 million.

Chris Lown: We expect other second quarter revenue of approximately $70 million with matter port revenue of approximately $40 million we.

Chris Lown: We expect full year revenue to increase by 100% to 115% to $270 million to $280 million with matter port contributing $135 million to $140 million.

Christian Lown: Residential revenue was $27 million in the first quarter. First quarter sales reflected the nadir of cancellations from our initial first quarter 2024 homes.com sales, and we expect net new bookings to increase throughout the year. This will result in meaningful revenue growth acceleration throughout the second half of 2025. Our 2025 residential revenue growth outlook remains in the mid-teens to low 20s percent range, and we expect second quarter revenue growth in the low single digits due to the impact of first quarter cancellation. In just one short year, we have rapidly increased Homes.com's unaided brand awareness ninefold to 36, and have become the second most visited US residential portal.

Residential revenue was $27 million in the first quarter.

Chris Lown: First quarter sales reflected the nadir of cancellations from our initial first quarter 2024 homes dotcom sales and we expect that net new bookings to increase throughout the year.

Chris Lown: This will result in meaningful revenue growth acceleration throughout the second half of 2025.

Chris Lown: Our 2025 residential revenue growth outlook remains in the mid teens to low 20% range and we expect second quarter revenue growth in the low single digits due to the impact of first quarter cancellations and.

Chris Lown: And just one for a year, we have rapidly increased homes Dotcoms unaided brand awareness ninefold to 36 and that become the second most visited U S residential portal as.

Christian Lown: As we continue to scale the Homes.com dedicated sales force, we expect revenue growth to accelerate into 2026 and beyond, and are excited about what could be CoStar's largest business.

As we continued to scale the homes dotcom dedicated sales force, we expect revenue growth to accelerate into 2026 and beyond and are excited about what could be <unk> largest business.

Christian Lown: For the first quarter, CoStar posted a $15 million net loss due primarily to the one-time cost from closing the Matterport acquisition. We earned $38.5 million of net investment income on our $3.8 billion in cash in the first quarter or a 4.1% net yield. We are making great progress on increasing our sales forces, which totaled 1,600 salespeople at NMARC. While much of the increase was concentrated in Homes.com, we are ahead of our sales headcount hiring plan across all of our brands. Contract renewal rate was 89% the first quarter of 2025 and remains strong at 94% for customers who have been subscribers for five years or longer.

Chris Lown: For the first quarter Costar posted a $15 million net loss due primarily to the one time costs from closing them at a port acquisition, we earned $38 $5 million of net investment income on a $3 $8 billion in cash in the first quarter or a four 1% net yield.

Chris Lown: We are making great progress on increasing our sales forces, which totaled 600 salespeople in March while much of the increase was concentrated in homes Dot Com. We are ahead of our sales headcount hiring plan across all of our brands.

Chris Lown: Our contract renewal rate was 89% in the first quarter of 2025 and remains strong at 94% for customers, who have been subscribers for five years or longer.

Christian Lown: Subscription revenue on annual contracts was 80% of total revenue for the first quarter of 2025. Net new bookings for the first quarter were $56 million, representing a sequential increase of 6% from the fourth quarter and a 29% increase from the third quarter of 2024. Absent the one-time headwinds from Homes.com cancellations in the first quarter, net new bookings would have been $60 million. Commercial net new bookings increased 14% year over year and 19% from the fourth quarter, coming in higher than any quarter in 2024. During the first quarter of 2025, CoStar Group repurchased 240,000 shares for an aggregate cost of $18.5 million.

Chris Lown: Subscription revenue on annual contracts was 80% of total revenue for the first quarter of 2025.

Chris Lown: Net new bookings for the first quarter were $56 million, representing a sequential increase of 6% from the fourth quarter and a 29% increase from the third quarter of 2024.

Chris Lown: Absent the one time headwinds from homes dotcom cancellations in the first quarter net new bookings would have been $60 million.

Chris Lown: Commercial net new bookings increased 14% year over year, and 19% from the fourth quarter coming in higher than any quarter in 2024.

Chris Lown: During the first quarter of 2025, Costar group repurchased 240000 shares for an aggregate cost of $18 $5 million, we still anticipate repurchasing $150 million of shares in total in 2025.

Christian Lown: We still anticipate repurchasing $150 million of shares in total in 2025.

Christian Lown: On March 27th, CoStar provided a non-binding indicative offer to acquire a domain group for $4.43 Australian dollars per share. As part of this effort, we acquired 107 million shares at an average cost of $4.22 Australian dollars, or approximately $290 million US dollars. We now own 16.9% of Domain's outstanding shares, are in the process of performing due diligence, and recently received a two-week extension to complete our due diligence by May 12th. For the full year of 2025, we expect revenue of $3.115 to $3.155 billion, implying an annual growth rate of 14 to 15%. This forecast is broadly in line with our original 2025 guidance and includes a four to five percentage point contribution from the Matterport acquisition.

Chris Lown: On March 27th Costar provided a nonbinding indicative offers to acquire domain group for $4 four through Australian dollars per share as part of this effort. We acquired 107 million shares at an average cost of 4.2 to Australian dollars.

Chris Lown: Approximately 290 million U S dollars. We now have 16, 9% of domains outstanding shares are in the process of performing due diligence and recently received a two week extension to complete our due diligence if I may 12.

Chris Lown: For the full year of 2025, we expect revenue of 3.115 to 3.155 billion.

Chris Lown: Implying an annual growth rate of 14% to 15%.

Chris Lown: This forecast is broadly in line with our original 2025 guidance and includes a four to five percentage point contribution from the matter Port acquisition.

Christian Lown: Second quarter 2025 revenue is expected in the $770 to $775 million dollar range, representing 14% year-over-year growth at the midpoint. 2025 Adjusted EBITDA is now expected in the range of $355 million to $385 million, reflecting an Adjusted EBITDA margin of approximately 12%. The inclusion of Matterport is anticipated to reduce our adjusted 2025 EBITDA forecast by approximately $30 million. So excluding Matterport, we remain broadly in line to slightly above our original 2025 guidance. Second quarter 2025 adjusted EBITDA is now expected to be $50 to $60 million, reflecting an adjusted EBITDA margin of around 7%.

Chris Lown: Second quarter 2025 revenue as expected in the $770 million to $775 million range, representing 14% year over year growth at the midpoint.

Chris Lown: 2025, adjusted EBITDA is now expected in the range of 355 million to $385 million, reflecting an adjusted EBITDA margin of approximately 12%.

The inclusion of matter port is anticipated to reduce our adjusted 2025 EBITDA forecast by approximately $30 million. So excluding matter port we remained broadly in line to slightly above our original 2025 guidance second.

Chris Lown: Second quarter 2025, adjusted EBITDA is now expected to be $50 million to $60 million, reflecting an adjusted EBITDA margin of around 7%.

Operator: With that, I will now turn the call back over to the operator for questions. Thank you. As a reminder, to ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again.

Chris Lown: With that I will now turn the call back over to the operator for questions.

Chris Lown: Thank you.

Speaker Change: Minder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one wondering again.

Chris Lown: Yeah.

Alexei Gogolev: Our first question comes from Alexei Gogolev with J.P. Morgan. You may proceed.

Speaker Change: Our first question comes from Alexia <unk> with JP Morgan you May proceed.

Alexei Gogolev: Hello, everyone. Andy, great to great to hear from you. Thank you for the introduction. And I was wondering if you had any additional comments on the delayed market listing exemption that was discussed by the NAR and then the reaction from Zillow. Have you had a chance to speak to brokerage firms? What is their view on the Zillow's and Resin reaction? What I've heard is overwhelmingly negative. So I've heard, read hundreds of comments from agents and again I'd say 90 some percent negative. So there's a pretty transparent thought there that they're requiring people to put their listings up early in order to make sure that they have a chance to monetize them and people aren't taking their listings to market without going through Zillow first and I think that is sort of a surprising overt sort of act that probably I think shows a little bit of weakness.

Speaker Change: Hello, everyone.

Speaker Change: Great two great to hear from you. Thank you for the introduction and I was wondering if you have any additional comments on the delayed market lifting exemption that was discussed.

Speaker Change: By the end they are and then the reaction from Zillow have you had the chance to speak to brokerage firms.

Speaker Change: Their view on residuals and risks and reactions.

Speaker Change: The M.

Speaker Change: What I've heard is overwhelmingly negative so I've.

Speaker Change: Heard read hundreds of comments from agents and.

Speaker Change: Again, I'd say 90 some percent negative.

Speaker Change: So there's a pretty transparent thought there that there.

Speaker Change: Acquiring people to put their listings up early in order to make sure that they have a chance to monetize them and people arent.

<unk> taken our listeners to market without going through Zillow first and I think that is.

Speaker Change: Sure.

Speaker Change:

Speaker Change: Sort of surprising.

Speaker Change: Of her sort of act that probably.

Speaker Change: <unk> shows a little bit of weakness, but.

Alexei Gogolev: But I think it's being confused a little bit with something related to COMPAS. I don't think it is. It is unusual to see something. The NAR is allowing having a portal trying to set a new set of rules.

Speaker Change: I think it's being confused a little bit was something related to compass I don't think it is it is.

Speaker Change: Unusual to see something.

Speaker Change: NAR is allowing having a portal trying to set a new set of rules.

Alexei Gogolev: So.

Speaker Change: So.

Andrew Florance: It created a good opportunity for us, for sure.

Speaker Change: Create a good opportunity for us for sure.

Alexei Gogolev: Thank you, Andy.

Speaker Change: Thank you Angie.

Christian Lown: And Chris, a quick follow up on your guidance. Would you be able to tell us what was the non-residential EBITDA margin in Q1, and if your outlook for resi spend for 2025 is still intact? Yeah, so the the commercial margin was 43% for the first quarter. And, as Andy mentioned, our Tech, Chris, that's impressive. It's pretty good margin. And as Andy mentioned, we have been very focused on expenses around Homes.com. A lot of our actions taken in the first corner to manage and reduce costs did come out of Homes.com. So we are very much on track from a budget perspective around the numbers we've discussed historically for Homes.com.

Speaker Change: Quick follow up.

Speaker Change: Your guidance.

Speaker Change: Would you be able to.

Speaker Change: Tell us would be.

Speaker Change: The nonresidential end to down margin in Q1.

Speaker Change: And if your outlook for rent the spend for 2025 is still intact.

Speaker Change: So the commercial margin was 43% for the first quarter and.

Speaker Change: As Andy mentioned or Chris that's impressive it's pretty good margin.

Speaker Change: And as you mentioned are we at.

Speaker Change: <unk> been very focused on expenses around homes Dot com.

Speaker Change: Out of our actions taken in the first quarter to manage and reduce cost did come out of homes Dot com. So we're very much on track from a budget perspective around the number as we've discussed historically for homes Dot Com no change there.

Christian Lown: No change there.

Christian Lown: Thank you, Chris. Thank you.

Chris: Thank you Chris.

Speaker Change: Thank you.

Pete Christiansen: Our next question comes from Pete Christiansen with Citi, you may proceed. Thanks. Good evening. Good progress on a number of fronts here. Andy, congratulations on closing Matterport. Thank you. You're welcome.

Speaker Change: Our next question comes from Pete Christiansen with Citi. You May proceed.

Speaker Change: Thanks, Good evening.

Speaker Change: <unk> progress in a number of frontier.

Speaker Change: Andy.

Speaker Change: Congratulations on closing amount of port. Thank you can you.

Speaker Change: You're welcome can you walk us through next 12 18 months.

Pete Christiansen: Can you walk us through next 12, 18 months? If we could just double click on how you envision Matterport being integrated into the CoStar platform. How do you think about monetization of that product? just just curious on on how do you think that a Matterport evolves from CoStar over the Sure, so Matterport's gonna have two different lives. One is, it's being very broadly used around the world by construction companies, brokers, agents, developers, boat dealers, airplane manufacturers, anyone trying to digitize a space. And then and then it will be more deeply embedded into all of our platforms from real estate manager to CoStar to LoopNet to apartments to homes to hopefully domain one day.

Speaker Change: Could you just double click on how you envision matter poor being integrated into the Costar platform.

Speaker Change: How do you think about monetization of that product and just curious on on how do you think that a matter of port of vials for poster over the next 12 to 18 months. Thank you.

Speaker Change: Sure.

Speaker Change: No.

Speaker Change: Matter of ports can I have two different lives. One is it's being very broadly used around the world by construction companies brokers ages developers.

Speaker Change: Both.

Speaker Change: Dealers.

Speaker Change: Airplane manufacturers anyone trying to digitize a space.

Speaker Change: And then and then it will be more deeply embedded into all of our platforms from real estate manager to Costar to Loopnet apartments to homestead hopefully the main one day.

Andrew Florance: And we will be embedding it deeply natively and building unique and special features in those product areas that makes a Matterport available with more power in those spaces. I've had a chance to meet a lot of the Matterport folks, I would say that they and I have real, a common vision for some exciting R&D projects that I think will add a lot of value. I believe R&D, I believe Matterport is on the verge of producing some pretty interesting things in their technology, they'll have a lot of applications, both for our platforms and outside our platforms. I think that I'm really amazed at how ubiquitous the value prop is for Matterport.

Speaker Change: And we will be embedding it deeply natively and building unique and special features in those product areas that.

Speaker Change: It makes it a matter of port available.

With more power in those spaces.

Speaker Change: Had a chance to meet a lot of the matter port folks I would say that.

Speaker Change: They and I have.

Speaker Change: Real a common vision for some exciting R&D projects that I think will add a lot of value.

Speaker Change: I believe R&D I believe matter port is on the verge of.

Speaker Change: Producing some pretty interesting things in their technology that will have a lot of applications, both for our platforms and outside of our platforms.

Speaker Change: I think that.

I'm really amazed at how ubiquitous the value prop is for a matter of port.

Andrew Florance: You know, I'm just recently touring some construction over in Europe and, you know, they've been Matterport in the construction site every week. Matterport, up until recently, has only had about five salespeople to cover Europe, Asia, Africa, you know, all the world, ex the United States, clearly, and I figure that those five salespeople had 1.3 million good prospects per salesperson.

Speaker Change: <unk> just recently touring some construction.

Speaker Change: Over in Europe.

Speaker Change: And they've been matter porting the construction site every week Matt.

Speaker Change: A matter of port.

Speaker Change: Up until.

Speaker Change: Recently has only had about five salespeople to cover Europe Asia Africa.

Speaker Change: All the world ex the United States, clearly and I figure that.

Speaker Change: Those five salespeople had one 3 million good prospects per salesperson.

Christian Lown: So I think there's a wonderful opportunity to invest in both the R&D side, the sales side, and grow significant revenue for Matterport, build it to a good margin, and then also fund more aggressive R&D within the product. Yeah, I'd expand on that a little bit and also add from a practical perspective, it will inevitably lower cancellations in products, right? As people have more time on site, they use it more. We hear of people renting apartments with Matterport without going physically there. People looking for commercial real estate will travel less and therefore will spend more time on site and become more ubiquitous.

Speaker Change: So I think there's a wonderful opportunity.

Speaker Change: Invest in both the R&D side the sales side.

Speaker Change: Grow significant revenue from matter port.

Speaker Change: Build it to a good margin and then also fund more aggressive R&D within the product.

Speaker Change: I would expand on that a little bit and also add from a from a practical perspective, it will inevitably lower cancellations and products right as people have more time on site. They use it more we hear of people renting apartments with battery ports without going physically there people looking for commercial real estate will travel less and therefore, we'll spend more time on site and become more ubiquitous.

Christian Lown: So we believe real financial tailwinds will accrue as well, as Andy said, really deeply embed this application across all of our platforms, which will just strengthen their outcomes, but also their financial outcomes as well. Thank you.

Speaker Change: So we think really we believe real financial tailwind will accrue as wells as Andy said really deeply embed this application across all of our platforms.

Speaker Change: We'll just strengthening their outcomes, but also their financial outcomes as well.

Speaker Change: Yeah.

Speaker Change: Thank you.

Operator: And as a reminder to ask a question, please press star 11 on your telephone. And please limit yourself to one question.

Speaker Change: And as a reminder to ask a question. Please press star one on your telephone and please limit yourself to one question. Our next question comes from George Tong with Goldman Sachs. You May proceed.

George Tong: Our next question comes from George Tong with Goldman Sachs, you may proceed. Hi, thanks. Good afternoon. You mentioned realizing about $50 million in residential savings in the quarter.

Speaker Change: Alright, thanks, good afternoon.

George Tong: You mentioned, realizing about $50 million in residential savings in the quarter can you talk about how you're thinking about investment spend for this year in light of the work that the capital allocation Committee is doing on the board.

George Tong: Can you talk about how you're thinking about investment spend for this year in light of the work that the Capital Allocation Committee is doing on the board? How are you thinking about the $900 million and change originally targeted for the year? Yeah, the $900 million investment is unchanged. The $500 million was really a capital allocation, a proactive capital allocation decision we made to take some costs out of homes.com and shift them towards the sales force. As was mentioned, our sales force growth is exceeding our expectations, which is fantastic, but we're able to make capital allocation decisions to move costs from one place and invest that capital elsewhere.

Speaker Change: How are you thinking about the $900 million in change originally targeted for the year.

George Tong: The $900 million.

George Tong: Investment is unchanged the $500 million was really a capital allocation of proactive capital allocation decision, we made to take some cost out of homes dot com and shift them towards the Salesforce as was mentioned our sales force growth is exceeding our expectations, which is fantastic, but we were able to make capital allocation decisions to move cost.

George Tong: From one place and invest that capital elsewhere.

George Tong: And so it's in line with plan and there are no changes. Thank you.

George Tong: So it's in line with plan and there are no changes.

George Tong: Thank you.

John Campbell: Our next question comes from John Campbell with Stevens, you may proceed. Thanks, Andy, I want to maybe circle back on CCP. I think you're probably expect a lot of questions there.

Speaker Change: Our next question comes from John Campbell with Stephens You May proceed.

John Campbell: Thanks, Andy I want to maybe circle back on CCP, I think youre, probably expect a lot of questions there.

John Campbell: It does seem like you're looking to positionhomes.com is, I guess, a site that kind of captures those private listings that don't abide by Zillow standard. I don't know if that's eventually as they make their way to the MLS, or maybe it's just a straight connection or a feed into you guys. That seems pretty clear to me.

Speaker Change: It does seem like if youre looking to position homes Dot com.

Speaker Change: That kind of captures those private listings that don't abide by Zillow standard.

Speaker Change: I don't know if thats eventually as they make their way into my last one maybe you could just straight connection or a feed into your guys that seems pretty clear to me, but outside of that I'm. Just curious the other ways you might be thinking about leaning in I don't know if thats, helping power, maybe white label, the private networks or something along those lines.

John Campbell: But outside of that, I'm just curious, the other ways you're maybe thinking about leaning in. I don't know if that's helping power, maybe white label the private list networks or something along those lines. I'm guessing there's probably some competitive dynamics that limit what you can say, but maybe just shed some light where you can. Yes, I think that You know, clear cooperation has always been, you know, people since the beginning of time in real estate have marketed listings off market. People always look to see if there's someone in the shop in the neighborhood, a connection that wants to buy a property, especially at the middle upper end properties, it happens at commercial real estate.

Speaker Change: I'm guessing, there's probably some competitive dynamics it limit what you can say, but maybe just shed some light where you can.

Speaker Change: Yes, so I think that.

Speaker Change: Clear cooperation has always been.

Speaker Change: And our people since the beginning of time and real estate have marketed listings off market people have always looked to see if there's someone in the shop in the neighborhood of connection that wants to buy a property, especially at the middle Upper end property that happens a commercial real estate it happens around the world typically 20% of listings around the world.

John Campbell: It happens around the world, typically 20% of listings around the world are going to be marketed off market or quote unquote, private.

Speaker Change: We're going to be marketed off market or quote unquote private I don't want to get too deeply until you know what compass is doing or what <unk> is doing but just more as a general theme.

John Campbell: I don't want to get too deeply into you know, what Compass is doing or what eXp is doing, but just more as a general theme. I think that there's an important dynamic changing here with clear cooperation being more flexible and with the no commingling rules on the MLS is changing. You've got people beginning to question where they want their listings to go and when they want them to go there. And, you know, if you've done some research, I'm sure you've heard that the lead diversion models are not popular. They don't exist in other countries because when people have a choice as to where they market their listings, they choose not to have their leads taken and sold off.

Speaker Change: I think that there is an important dynamic changing here with clear cooperation being more flexible and with.

Speaker Change: On the no commingling rules on the MLS is changing.

Speaker Change: You've got.

Speaker Change: People begin to question, where they want their listeners to go and when they want them to go there and.

Speaker Change: You've done some research I'm sure you've heard that.

Speaker Change: The lead diversion models are not popular they don't exist in other countries because when people have a choice as to where they market their listings they choose not to have their leads taken and sold off so I think theres generally.

John Campbell: So I think there's generally some anxiety on the part of some of those folks that. The people will make more choices to avoid the lead diversion platforms longer and that positions us really well because we're actually in harmony with everyone because we are actually presenting their listings with their names on them and and are not trying to rewrite the rules or trying we're not trying to regulate it. We're pretty much working with the clients as they want to work, but we're not going to get into any debates between you know different firms on Thank you.

Speaker Change: Some anxiety on the part of some of those folks that.

Speaker Change: The people will make more choices to avoid the lead diversion platforms longer and that positions us really well because we're actually in harmony with everyone. Because we are actually presenting their listings with their names on them and and are not trying to rewrite. The rules are trying we're not trying to regulate it we're pretty much.

Speaker Change: Working with our clients as they want to work, but we're not going to get into any debates between different firms on.

Speaker Change: The strengths of clear cooperation private networks and all that stuff.

Speaker Change: I think they do it anyhow and they have done it since the beginning of time.

Speaker Change: Thank you.

Ryan Tomasello: Our next question comes from Ryan Tomasello with KVW, you may proceed. Hi, everyone. Thanks for taking the questions. I wanted to double click on on multifamily, I guess.

Speaker Change: Our next question comes from Ryan Tomasello with <unk> you May proceed.

Speaker Change: Okay.

Ryan Tomasello: Hi, Ron Thanks for taking the questions I wanted to.

Speaker Change: Double click on multifamily I guess.

Ryan Tomasello: Can you help us understand what's driving the growth decel in the second quarter to 10% and your confidence in the implied acceleration of the back half of the year? And does that bake in any benefit at all from the salesforce investment? Considering, you know, the incentives you called out for prioritizing property growth, how should we consider the evolution there on pricing versus property? And then just lastly, on bookings, I don't think we got any color on on apartments bookings in the quarter. So any anything you're willing to provide there? Yeah, so snuck in a couple questions there.

Speaker Change: Can you help us understand what's driving the growth you saw in the second quarter to 10% and your confidence in the implied acceleration in the back half of the year and does that bake in any benefit at all from the sales force investments.

Speaker Change: And considering the incentives you called out for prioritizing property growth how should we consider the evolution there on pricing versus property count.

Speaker Change: And then just lastly on bookings.

Speaker Change: Don't think we got any color on on apartments bookings in the quarter. So any anything youre willing to provide there would be helpful. Thanks, Yeah. So snuck in a couple of questions. There. So so one remember the second quarter is the big quarter for apartments or comments from the Big Conference happens happens in June or so the back end of the second quarter. So that flows through in the third and fourth quarter. So that's the dynamic.

Ryan Tomasello: So so one, remember, the second quarter is the big quarter for apartments.com. That's when the big conference happens happens in June. So the back end of the second quarter, so that flows through in the third and fourth quarter. So that's the dynamic that happens year in and year out. I think you have that dynamic, you in addition have the dynamic of the additional headcount from a sales perspective. You know, as Andy said, the rent period Salesforce is a fantastic Salesforce, they're actually already up and running. They've had a great experience trying to sell against us now.

Speaker Change: Happens year in and year out I think you have that dynamic you edition of the dynamic of the additional head count from a sales perspective.

Speaker Change: Andy You said the rent period Salesforce is a fantastic sales force, they're actually already up and running.

Speaker Change: They've had a great experience trying to sell against us. So now they get to sell for us So we'll get acceleration there.

Ryan Tomasello: So now they get to sell for us. So we'll get acceleration there. You know, the ensuring that the sales team is focused on the right things, you know, rooftops is important, and price is important, but we feel good about that acceleration. So all that translates into a, you know, a third and fourth quarter increase in our acceleration of where we are versus the second quarter. So that all makes us feel, you know, relatively good.

Speaker Change: Ensuring that the sales team is focused on the right things.

Speaker Change: Rooftops as important and pricing is important but we feel good about that acceleration so all of that translates into a.

Third and fourth quarter increase in our acceleration of where we are versus the second quarter. So that all makes us feel relatively good.

Ryan Tomasello: And we didn't provide a net new number for four apartments, but you should assume a sort of in the mid 20s, the million dollar range for net new book Thank you.

Speaker Change: We didn't provide the net new number for all four for apartments, but you should assume it's sort of.

Speaker Change: And the mid twenties.

Speaker Change: The million dollar range for net new bookings.

Speaker Change: Thank you.

Stephen Sheldon: Our next question comes from Stephen Sheldon with William Blair. He may proceed. I would emphasize that, you know, we've been coming through. a very challenging commercial real estate market. It is, I think, a real testament to CoStar that we continue to show good growth through a very brutal market condition for commercial real estate. I do believe that, historically, we've always slowed our pricing increases during difficult markets to support our clients. And then we are generally more aggressive with our price adjustments when we are in good markets for our clients. And I think it's pretty clear that we are moving into a better market for our clients.

Stephen Sheldon: Our next question comes from Stephen Sheldon with William Blair You May proceed.

Stephen Sheldon: Hey, Thanks on the suite I guess as you're thinking about the degree of pricing increases changed at all I think you've typically talked about roughly.

Stephen Sheldon: 3% to 5% annual uplift just given your dominant positioning there.

Stephen Sheldon: And continuing to add new data set new forms of value could you potentially look to be more aggressive on that front in the coming years, especially.

Stephen Sheldon: CRE backdrop continues to improve.

Stephen Sheldon: Aye.

Stephen Sheldon: I would emphasize that we have been coming through.

Stephen Sheldon: A.

Stephen Sheldon: Very challenging commercial real estate market.

Stephen Sheldon: It is.

Stephen Sheldon: I think a real testament to Costar that we continue to show good growth through.

Stephen Sheldon: A very brutal market condition for commercial real estate.

Stephen Sheldon: I do believe that at all.

Stephen Sheldon: Historically, we've always slowed or our pricing increases during difficult markets to support our clients and then we are generally more aggressive with our price adjustments. When we are in good markets for our clients.

Stephen Sheldon: And I think it's pretty clear that we are moving into a better market for our clients you can see it in the availability rates dropping you can see vacancy edging over let's see transaction volumes picking up we tend to talk about the market's turning.

Stephen Sheldon: You can see it in the availability rates dropping. You can see vacancy edge and over. You can see transaction volumes picking up. We tend to talk about the markets turning a little bit earlier than our clients understand they're turning. But they definitely are turning.

Stephen Sheldon: Little bit earlier than our clients understand they're turning.

Stephen Sheldon: <unk>.

Stephen Sheldon: But they definitely are turning.

Stephen Sheldon: Barring anything, a major recession happening, generally, the overall fundamentals for real estate are good and would allow us to be a touch more aggressive in the years to come. But I think you'd also just see volume increasing, too.

Barring anything in a recession or a major recession happening.

Andy Florance: Generally the overall fundamentals for real estate are good and would allow us to be a touch more aggressive in the in the years to come but I think you'd also just seat volume increasing too I'd also add that the value proposition that Andy has developed over costar since the development is massively different today than it was right at inception was primarily a broker.

Stephen Sheldon: I'd also add that the value proposition that Andy has developed over CoStar, since the development is massively different today than it was right at inception, was primarily a broker product with lender, with the lease benchmark product that's coming, with STR. I mean, the value proposition ability to create additional revenue streams or compounds, sort of the value is dramatically different. So, the model has also changed with dinners to our advantage as we roll out those products and expand TAMs as well. Thank you.

Andy Florance: With lender with the least benchmark product, that's coming with STR, I mean, the value proposition and ability to.

Speaker Change: Create additional revenue streams or compounds.

Speaker Change: The value is dramatically different so the model has also changed with dinner is to our advantage as.

Speaker Change: As we roll out those products and expand teams as well.

Speaker Change: Thank you.

Jeff Mueller: Our next question comes from Jeff Mueller with Baird, you may proceed. Yeah, thank you. It sounds like when you were talking about homes.com attrition, a lot of that was like early cancels within a contract metric.

Speaker Change: Our next question comes from Jeff Mueller with Baird You May proceed.

Speaker Change: Yes. Thank you it sounds like when you were talking about Comstock.

Speaker Change: Tricia and a lot of that was like really cancels with enough contract metric can you give us any sense of clients that signed on kind of last fall that were on a six month contract and then just naturally come up for renewal that we're kind of sold.

Jeff Mueller: Can you give us any sense of clients that signed on kind of last fall that were on a six month contract and have just naturally come up for renewal, that were kind of sold on a message that was better aligned to what the value prop actually is? Just like what those contracts are retaining at? Or is there some reason that wouldn't start to provide a good indication at this point?

Speaker Change: A message that was better aligned toward the value prop actually is just like what those contracts are retaining at or is there. Some reason that what it is.

Speaker Change: To provide a good indication at this point thank you.

Jeff Mueller: Thank Yes, I wouldn't have specific data on fall contracts on six months or no. What I can tell you is that when you look at the when you look at the end period cancellation rate, that line is dramatically down. It is falling to some pretty low numbers. And I believe the six month in the last month of the last of the six months in contract cancellation is point two five percent, which is de minimis. It had been up at. a much higher number, maybe five, five, six, seven, 8% at the beginning. And again, I believe a big part of that was just in the excitement of the early launch.

Speaker Change: Yes, I wouldn't have specific data on fall contracts on six month renewal what I can tell you is that when you look at the.

Speaker Change: When you look at the in period cancellation rate that line is dramatically down it is falling.

Speaker Change: To some pretty low numbers and I believe the six months in.

Speaker Change: The last month of the last of the six months.

Speaker Change:

Speaker Change: In contract cancellations, 0.25%, which is de Minimis it.

Speaker Change: Had been up at all.

Speaker Change: A much higher number maybe 5567, 8% at the beginning and again I believe a big part of that was just in the excitement of the early launch.

Jeff Mueller: Everyone thought we were selling lead diversion, and no one knew what the whole rest of the world is buying, which is digital marketing for real estate, which is what Apartments is, it's what LoopNet is, it's what RA Group, Rightmove, everyone else is. So we were offering something new.

Speaker Change: Everyone thought we were selling lead diversion and no one knew what the whole rest of the world.

Speaker Change: <unk>, which is digi.

Speaker Change: Digital marketing for real estate, which is what apartments is it's what loopnet as it's what our a group right move everyone else's. So we're offering something new that we had.

Jeff Mueller: Now we had, a very small sales force, a generalized sales force. But now I'm very happy with seeing, it's up in that 40 NPS range, which is outstanding. And to do it that quickly suggests to me that we will have solid renewal rates going forward.

Uh huh.

Speaker Change: A very small sales force a generalized salesforce, but now now I'm very happy with seeing.

Speaker Change: Up in that 40, NPS range, which is outstanding.

Speaker Change: And to do it that quickly suggests to me that we will have solid renewal rates going forward I'd also highlight the preponderance of our contracts are 12 months. So again the data is moving in the right direction, but I think your question is three bidders, we asked and sort of the next three to six months as I start to roll forward.

Jeff Mueller: I'd also highlight the preponderance of our contracts are 12 months. So again, the data is moving in the right direction, but I think your question is be better to be asked in sort of the next three to six months as they start to roll forward.

Andrew Florance: Thank you.

Andrew Florance: I would now like to turn the call back over to Mr. Andy Florence for any closing remarks. I think I've taken all the time I was allotted for this year. So we're off to a great start in 25. Again, I want to thank the board members who are completing their service to the company and welcome the new board members on board. I'm very excited about the progress we're making with homes.com and with the great performance we're seeing across basically all of our product areas. Thank you all for joining us and your patience on the call.

Speaker Change: Thank you I would now like to turn the call back over to Mr. Andy Florence for any closing remarks.

Andy Florance: And I think Ive taken all the time I was a lot of for this year. So we're off to a great start in 'twenty five again I want to thank the board members, who are completing their service to the company and welcome the new more benders onboard I'm very excited about the progress, we're making with <unk>.

Speaker Change: <unk> Dot com.

Speaker Change: With the.

Speaker Change: The grade performance, we're seeing across basically all of our product areas. Thank you all for joining us and your patience on the call.

Andrew Florance: And we look forward to updating you next quarter. Thank you.

Speaker Change: And we look forward to updating you next quarter.

Speaker Change: Thank you. This concludes the conference. Thank you for your participation you may now disconnect.

Operator: This concludes the conference. Thank you for your participation.

Operator: You may now disconnect.

Speaker Change: Okay.

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