CoStar sees net income jump 32% in year marked by acquisitions

Real estate data giant, which generated $1.4B revenue, credited strong performance to

Feb.February 27, 2020 07:00 AM
CEO Andrew Florance (Credit: CoStar via YouTube)

CoStar Group CEO Andrew Florance (Credit: CoStar via YouTube)

CoStar Group reported $315 million in net income in 2019, following a year of acquisitions and the conclusion of a protracted legal fight.

The real estate data firm said Tuesday that it generated $1.4 billion revenue in 2019, up from $1.2 billion in 2018. Its income was up 32 percent from the previous year, while its cash and cash equivalents dipped slightly from $1.1 billion to $1.07 billion. CoStar’s revenue for the fourth quarter was $375 million, up 19 percent year over year. Net income for the quarter saw a 5 percent bump year over year, to $88 million.

CoStar’s share price dropped about 4 percent Wednesday, from $708 on Tuesday, before rebounding slightly to $682 a share when the markets closed.

CEO Andrew Florance said the rising financial metrics were in part thanks to the strong performance of its apartments listing businesses, including

“Our efforts to build online marketplaces and commercial real-estate are certainly paying off with almost 62 percent of our sales in 2019 coming from, LoopNet and our other market places, a trend we can expect to continue into 2020,” he said during Tuesday’s earnings call.

He also said CoStar was doubling down on its marketing expenditure for to $250 million a year. Actor Jeff Goldblum is the face of the campaign.

To build on that, Florance also said the company had last month rolled out a series of online renter tools to improve customer and landlord experience. About 17,000 customers have used the new tools, he said.

The results follow a year of acquisitions, including the buy of hotel data provider STR for $450 million in November. This month, it bought apartment listing firm RentPath out of Chapter 11 bankruptcy for $588 million.

In 2019, it also ended its legal battle with now-defunct competitor Xceligent, which it had sued for copyright infringement in 2017. CoStar was awarded a $500 million proposed judgment from the court-appointed trustee overseeing Xceligent’s bankruptcy, according to court filings. Ultimately, the company recouped $10.75 million from Xceligent’s insurers, an agreement approved by Delaware Bankruptcy Court.

Related Articles

Eric Gordon

Eric Gordon on the evolution of the residential data game — and how to stay competitive in the new world

Big Tech locations in NYC

MAP: Here’s a look at all the Big Tech locations in NYC

What will proptech look like in 2019 and beyond?

What will proptech look like in 2019 and beyond?

Cyril Berdugo and Tom Petit (Credit: Landis)

Proptech startup Landis inks deal to turn renters into buyers

CEO Anthemos Georgiades (Credit: iStock)

Zillow rival Zumper raises $60M to build more rent-payment tools

Dealpath's Mike Sroka and Blackstone's John Fitzpatrick (Credit: Dealpath, Blackstone)

Blackstone is latest real estate giant to back Dealpath

Future City 2020

Highlights from Day 3 of TRD’s Future City summit

Future City 2020

The best party story from Future City’s beach dinner