Key Highlights

  • Second-quarter 2026 Revenue was about $925 million, up roughly 18% year over year, with Net Income increasing sharply and adjusted EBITDA more than doubling to around $184 million.
  • The company's residential business, anchored by Homes.com, turned profitable, with membership up 56% from a year earlier and record quarterly net new bookings of around $93 million.
  • CoStar operates a portfolio of real-estate information and marketplace businesses, including CoStar commercial data, LoopNet, Apartments.com and Homes.com.
  • The company has expanded through acquisitions such as the 3D-capture company Matterport.

CoStar Group (NASDAQ:CSGP) has spent heavily for years to build its residential real-estate marketplace, and its latest quarter suggested that Investment is finally translating into profits. The real-estate data and marketplace giant reported second-quarter 2026 results that it described as a profitability inflection.

CoStar's dominant position in commercial real-estate information sits alongside a costly push into residential, and the market is now assessing whether the payoff justifies the years of spending.

A Profitability Inflection

For the second quarter of 2026, CoStar reported revenue of about $925 million, up roughly 18% year over year, with net income increasing sharply, by a reported 817%, and adjusted EBITDA more than doubling to around $184 million. The company highlighted that its residential business, anchored by Homes.com, turned profitable, and it grew Homes.com membership significantly, reporting members up 56% from a year-earlier quarter and record quarterly net new bookings of around $93 million. After a prolonged period in which heavy Marketing spending on Homes.com depressed margins, these results mark a meaningful shift: the residential investment appears to be generating returns while the core information Business continues to grow.

Business and Financial Position

CoStar operates a portfolio of real-estate information and marketplace businesses, including its flagship CoStar commercial-data service, LoopNet, Apartments.com and the residential portal Homes.com, and it has expanded through acquisitions such as the 3D-capture company Matterport. Its core commercial-information Franchise is highly profitable and provides subscription revenue that funds growth investments. The residential push aims to challenge entrenched competitors in the large home-search market, and the second-quarter profitability inflection is an important proof point.

Whether One Profitable Quarter Becomes a Trend

The key signals are whether the residential business sustains profitability and bookings momentum, continued growth and margins in the core commercial franchise, and the integration of acquisitions like Matterport. Investors will be monitoring Homes.com membership and engagement, overall Margin expansion, and competition in residential real-estate portals. Execution risk in scaling residential profitably and the stock's valuation are key considerations.

CoStar's willingness to spend years absorbing losses on Homes.com to build residential scale was always a bet that the marketplace would eventually reach the size where Advertising Economics turn favorable. The Q2 residential profitability suggests that point may have arrived, which would validate a controversial strategy. For the stock, the key is durability: one profitable quarter is encouraging, but investors will want several more to trust that the residential business has genuinely inflected rather than benefited from timing, and the premium valuation leaves little room for disappointment.