Slide 1: Fourth Quarter and Full Year 2023 Investor Presentation
Fourth Quarter and Full Year 2023 Investor Presentation
Slide 2: Legal Disclaimer
Legal Disclaimer Certain information in this presentation includes “forward-looking statements” within the meaning of federal securities laws, including financial projections of CoStar Group, Inc. (“CoStar Group” or the “Company”), addressable markets, statements about management’s plans, growth str
Slide 3: Fourth Quarter and Full Year 2023 Highlights
Fourth Quarter and Full Year 2023 Highlights
Slide 4: Fourth Quarter and Full Year 2023 Highlights
Fourth Quarter and Full Year 2023 Highlights • Full year 2023 revenue increased 13% year-over-year and 12% in the fourth quarter 2023, exceeding the high end of our guidance range. • Commercial information and marketplace businesses grew revenue 14% in 2023, with profit margins improving to 40% for
Slide 5: Fourth Quarter and Full Year 2023 Results
Fourth Quarter and Full Year 2023 Results Fourth Quarter Full Year $640 million $2.46 billion Revenue 12% year-over-year growth 13% year-over-year growth $96 million $375 million Net income $0.24 per diluted share $0.92 per diluted share Net new bookings $58 million $286 million $130 million $492 mi
Slide 6: 2024 Outlook
2024 Outlook First Quarter Full Year $645 million to $650 million $2.75 billion to $2.77 billion Revenue 10% to 11% year-over-year growth 12% to13% year-over-year growth ($5) million to ($2) million $115 million to $129 million Net income ($0.01) to $0.00 per diluted share $0.28 to $0.32 per diluted
Slide 7: Traffic Growth Accelerating to 62% Year over Year in Q4 2023
Traffic Growth Accelerating to 62% Year over Year in Q4 2023 160 140 120 Unique Visitors in Millions 100 80 60 40 20 - 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Source: Google Analytics Unique Visitors – All CoStar Sites. Growth rate based on 4Q23 vs 4Q22..
Slide 8: Company Overview
Oe CoStar Group" Company Overview
Slide 9: Mission Statement
MISSION STATEMENT We are digitizing the world’s real estate, empowering all people to discover properties, insights, and connections that improve their businesses and lives. Oe] CoStar Group”
Slide 10: CoStar Group is the Global Leader in Digitizing Real Estate
CoStar Group is the Global Leader in Digitizing Real Estate 37 2 billion+ $5 billion+ ~6,200 years of real estate annual visits investment in research employees experience to our websites and technology member of the 500 Innovator of the Year COMPANY OF THE YEAR Best Integrated Marketing Campaign 74
Slide 11: Over 35 Years of Growth and Innovation
Over 35 Years of Growth and Innovation
Slide 12: A Global Leader in the Digital Transformation of the $300+ Trillion Real Estate Industry
A Global Leader in the Digital Transformation of the $300+ Trillion Real Estate Industry • Long growth runway: Global addressable market for real estate information and marketplaces estimated at > $100 billion. • Strong competitive position: Massive proprietary dataset built over 37 years with > $5
Slide 13: Global Real Estate: A $300 Trillion Asset Class
Global Real Estate: A $300 Trillion Asset Class U.S. REAL ESTATE $70 TRILLION GLOBAL REAL ESTATE (Year CoStar entered market) $300 TRILLION Office (1986) Industrial (1994) United States Retail (2004) Rural Land (2011) Apartment (2014) Single Family Hotel Residential/ (2019) Canada New Homes China (2
Slide 14: ~$40B North American Addressable Market, Global Market > $100B
~$40B North American Addressable Market, Global Market > $100B Total North American Addressable Market $4 Billion $9 Billion $5 Billion $6 Billion >$15 Billion 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% TAM Sources: CoStar, Apartments, LoopNet and Ten-X – CoStar estimate Homes.com – extrapolation o
Slide 15: Strong Double-Digit Growth with Two Brands Over $1 Billion
Strong Double-Digit Growth with Two Brands Over $1 Billion 5 YEAR CAGR $2.8B 15% 20% TOTAL 5 YEAR REVENUE CAGR $2.5B 9% 150% 2023-2024 only $2.2B 13% $1.9B $1.7B $1.1B 17% $1.4B $1.0B 11% 2019 2020 2021 2022 2023 2024E Costar Multifamily LoopNet Residential Information Services Other Marketplaces
Slide 16: Consecutive Quarters of Double-Digit Revenue Growth
51 Consecutive Quarters of Double-Digit Revenue Growth Regardless of Commercial Property Transaction Volumes 700 Quarterly Revenue Transaction Volumes High Inflation 450 2022-2023: +12% Growth 600 Pandemic 400 • 95% subscription revenue 2020-2021: +18% Growth 350 500 • 81% annual contracts Quarterly
Slide 17: More Diversified with More Countercyclical Business Mix
More Diversified with More Countercyclical Business Mix Since the Great Recession 2008 REVENUE 2023 REVENUE Other Marketplaces Other 5% Information Revenue Residential Services 2% LoopNet 11% CoStar 38% CoStar Information Marketplaces 92% & Analytics 55% 45% Information & Analytics Multifamily Infor
Slide 18: Diversified Client Base with Minimal Concentration
Diversified Client Base with Minimal Concentration TOP 1,000 CLIENTS: REVENUE BY CLIENT SEGMENT NONE MORE THAN 2% Other 15% Broker 21% Lender 4% Investor 7% Property Management Owner 19% 34% *Revenue by client segment and by client extrapolated from December 2023 CoStar billing data.
Slide 19: Successful Acquisition and Integration Track Record
Successful Acquisition and Integration Track Record 2023 REVENUE COMPOSITION Acquired $600 24% $500 Millions $400 Organic 76% $300 $200 $100 $0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Organic Revenue Acquired Revenue for the year following acquisition
Slide 20: High Growth, High Margin Subscription Business Model
High Growth, High Margin Subscription Business Model 23% Revenue CAGR since IPO 24 years ago Double-Digit Revenue and Net Income CAGR of 29% over the last 10 years Adjusted EBITDA Growth Adjusted EBITDA CAGR of 14% over the last 10 years 95% subscription revenue with 81%+ annual contracts Pr
Slide 21: Discover your new home. Helping 100 million renters find their perfect fit.
Discover your new home. Helping 100 million renters find their perfect fit.
Slide 22: Apartments.com by the Numbers
Apartments.com by the Numbers $1B 23% Year-over-Year Revenue Run Rate Revenue Growth #1 1M+ Rank in Brand Rental Awareness Availabilities 1B 44M Average Monthly Annual Visits Unique Visitors *All data except revenue as of 12/31/23. Revenue Run Rate based on January 2024 annualized.. Traffic data fro
Slide 23: Multifamily Revenue Growth Fully Recovered in 2023
Multifamily Revenue Growth Fully Recovered in 2023 From the Post Pandemic Downturn 25% 24% 23% 23% 23% 21% 20% 20% 18% 16% 15% 11% 10% 10% 6% 6% 6% 5% 0% Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23 Q2 23 Q3 23 Q4 23
Slide 24: Our Biggest Customer Count Ever
Our Biggest Customer Count Ever! ~71,000 APARTMENT COMMUNITIES now advertise on Apartments.com
Slide 25: Apartments.com Beats Competition on the Metrics That Matter to Advertisers
Apartments.com Beats Competition on the Metrics That Matter to Advertisers 2X more time 2X higher 3X more per visit conversion leases Sources: Traffic from Comscore Media Matrix, January - December 2023; Lease data from Rent Dynamics, January - September 2023
Slide 26: Unaided Brand Awareness at All Time Highs
Unaided Brand Awareness at All Time Highs 52% 53% 52% 50% 49% 40% 44% 40% 36% 36% 35% 34% 34% 34% 37% 32% 31% 33% 30% 30% 20% Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Source: Dynata a leading market research sampling provider
Slide 27: Tremendous Opportunity Ahead in the Small to Medium Property Space
Tremendous Opportunity Ahead in the Small to Medium Property Space Universe Clients Annual Revenue Revenue Unit Range TAM ($M) (Properties) (Properties) Run Rate ($M) Penetration $7B 1-49 23M 17K $61M 1% $6B opportunity 50-99 69K 11K $112M 11% $1B 100+ 104K 43K $792M 40% $2B Grand Total 23M 71K $965
Slide 28: Success of Apartments.com
Success of Apartments.com Growth Since Acquisition 2014 2024 5th place in highly fragmented The leading online rental Industry Rank #1 online rental search industry marketplace Revenue $75 million $1 billion revenue run rate 13X 4 million average monthly unique Traffic 44 million monthly unique visi
Slide 29: The fastest growing U.S. residential marketplace
The fastest growing U.S. residential marketplace
Slide 30: Our Vision
Our Vision Establish Homes.com as the #1 residential real estate marketplace
Slide 31: Homes.com by the Numbers
Homes.com by the Numbers 100M+ Millions Monthly Unique Leads Visitors per Quarter 2M+ 20K+ Residential For Sale Neighborhood and Rental Listings Content 512K 1M+ Agents with Registered Agents 1+ Listing * Sources: Homes.com surpassed 100 million monthly unique visitors, according to Google Analytics
Slide 32: A Better Business Model – Your Listing, Your Lead
A Better Business Model – “Your Listing, Your Lead” • Only Homes.com connects you to the listing agent who knows the home best • No cold calls, robocalls, or spam from random agents • Competitor models monetize buyer agency, taking one third of agent’s commissions • Homes.com is providing millions o
Slide 33: Our Proprietary Content Sets Us Apart
Our Proprietary Content Sets Us Apart. Consumers Aren’t Just Looking for a Home, They’re Looking for a Community. Homes.com is digitizing rich content for communities across the U.S. 20,000+ Neighborhoods 40,000+ Parks 125,000+ Schools 65,000+ Condo Buildings
Slide 34: Portals Adhering to Your Listing Your Lead Are the Most Successful
The Real Estate Portals Adhering to the Your Listing Your Lead Principal are the Most Successful Not Your Listing Your Lead Your Listing Your Lead $2.0 $2.0 $1.5 $1.5 $1.0 $1.0 $0.5 $0.5 $0.0 $0.0 Zillow Redfin CoStar Rightmove REA Group Scout24 Lifull ($0.5) ($0.5) Group ($1.0) ($1.0) ($1.5) ($1.5)
Slide 35: 2024 Supercharged Marketing Campaign
“We’ve done your home work.” 2024 Supercharged Marketing Campaign
Slide 36: Biggest Real Estate Campaign Ever
BIGGEST Real Estate Campaign Ever Working on behalf of the industry to help agents sign more buyer and seller agreements, drive demand for their listings and close more transactions. 80 Over a Reaching BILLION DOLLARS invested BILLION impressions 90% of households
Slide 37: We Kicked Off The Biggest Advertising Stage In America
We Kicked Off The Biggest Advertising Stage In America 4 QUARTERS, 4 Commercials Launch Mascot Salon
Slide 38: Homes.com will be Everywhere
Homes.com will be EVERYWHERE. No other competitors come close to our investment to drive leads to all agents
Slide 39: Our Residential Network Is Now the Second Most Visited Real Estate Portal
Our Residential Network Is Now the Second Most Visited Real Estate Portal… 200 150 #2 Residential Network 100 50 - “Average unique monthly users for the latest fiscal quarter ending December 31, 2023 for: (i) CoStar residential network as measured by Google Analytics; (ii) Zillow’s network as report
Slide 40: Investing to Create the #1 Residential Portal in the UK
Investing to Create the #1 Residential Portal in the UK Average monthly unique visitors since acquisition up 143% Listings up 57,000 since acquisition Agent advertisers up 1,000 since acquisition Leads have grown 81% since acquisition 2024 Revenue Forecast of $40 million
Slide 41: The global leader in commercial real estate information
The global leader in commercial real estate information, analytics, and data-driven news
Slide 42: CoStar by the Numbers
CoStar by the Numbers $1B 193K+ 2024 Subscribers Forecast Revenue 895K 7M Commercial Listings Properties 15M 5M Lease Sale Transactions Transactions * Revenue Run Rate based on December 2023 annualized. Subscriber count as of February 2024. All other data from CoStar internal database as of December
Slide 43: CoStar Product Investments Expand the Market Size
CoStar Product Investments Expand the Market Size, Resulting in Long-Term Double-Digit Growth $250 $4B U.S. MARKET SIZE 12% Revenue Growth Rate Tenants Ten Year CAGR Hospitality $200 Lenders Quarterly Revenue $150 Owners / (in millions) Investors Brokers / $100 Appraisers $50 $0 2004 2005 2006 2007
Slide 44: Unparalleled Research Methodology
Unparalleled Research Methodology 1,000+ 400 Drones 70 Analysts and In-market Economists canvassers 1 1,600 Cessna capturing aerial insights Researchers Automated data extraction 1,200 Software Developers To facilitate the gathering of data 50 Journalists Across Data feeds and third-party data 1 Bas
Slide 45: The #1 global commercial real estate marketplace
The #1 global commercial real estate marketplace
Slide 46: LoopNet by the Numbers
LoopNet by the Numbers $277M 16% 5 Year Revenue Revenue Run Rate CAGR 14M ~370K Monthly Unique CRE Brokers & Visitors Worldwide Owners Advertising 18X 96% #1 Google Fortune 1000 keywords than Companies closest competitor Active on Site *All data as of December 2023. Run Rate based on December 2023 a
Slide 47: Commanding Share of Traffic vs. Marketplace Competitors
Commanding Share of Traffic vs. Marketplace Competitors LoopNet Network vs. Competitors LoopNet Network crexi propertyshark commercialcafe 64x officespace vts commercialsearch Unique Visitors of the Avg. reonomy CRE Marketplace Competitor buildout commercialexchange Instantoffices 5x propertycapsule
Slide 48: LoopNet Revenue Up 5x Since Acquisition
LoopNet Revenue Up 5x Since Acquisition $70 Early Stages of a Massive Domestic International Global Opportunity $60 $5 Billion Quarterly Revenue in Millions $50 North American TAM $40 $15 Billion Global TAM $30 $20 $10 $0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Slide 49: LoopNet International Expansion Underway
LoopNet International Expansion Underway LoopNet Canada loopnet.ca LoopNet UK loopnet.co.uk LoopNet Spain loopnet.es LoopNet France loopnet.fr
Slide 50: The global leader in hospitality information, analytics and benchmarking
The global leader in hospitality information, analytics and benchmarking
Slide 51: STR by the Numbers
STR by the Numbers 17% 81K YoY Subscription Hotels Worldwide Revenue Growth 10M 190 Guest Rooms Countries $300M 98% Total Addressable Renewal Rate Market *Based on internal CoStar data as of December 2023.
Slide 52: STR Data Includes 81,000+ Hotels Across 190 Countries
STR Data Includes 81,000+ Hotels Across 190 Countries
Slide 53: The leading platform for lease accounting and management
The leading platform for lease accounting and management
Slide 54: Real Estate Manager by the Numbers
Real Estate Manager by the Numbers 12% 97% 5 Year Revenue Customer CAGR Retention Rate $10B Monthly Lease Payments Managed 625K 33K Real Estate System Users Leases Revenue CAGR 2018-2023. Retention Rate for fourth quarter 2023. All other data from internal database as of December 2023.
Slide 55: Platform for Managing the Tenant's Entire Lease Lifecycle
Platform for Managing the Tenant’s Entire Lease Lifecycle The Most Comprehensive Portfolio Management Platform with Integrated CoStar Real Estate Data Drive Cost Savings Optimize Real Estate Portfolios Achieve Lease Accounting Compliance
Slide 56: The SMARTER, BETTER, FASTER way to transact commercial real estate
The SMARTER, BETTER, FASTER way to transact commercial real estate
Slide 57: Ten-X by the Numbers
Ten-X by the Numbers $31B 92% Properties Sold in Assets Sold 90 Days or Less 58% Trade Rate Since 2020 94% 85% Non-Distressed Close Rate Assets Assets sold since inception in 2009. Trade rate since acquisition in 2020. Close rate, time to close and non-distressed assets sold are for the full year of
Slide 58: Ten-X Platform Closes Deals 2-3x Faster than Offline Transactions
Ten-X Platform Closes Deals 2-3x Faster than Offline Transactions Asset Marketing & Asset Evaluation Bidder Qualification Contracts & Closing +- 10 Days Onboarding & Due Diligence Online Auction
Slide 59: Ten-X Revenue Opportunity is >$3 Billion at Current Transaction Levels
Ten-X Revenue Opportunity is >$3 Billion at Current Transaction Levels Market Penetration % ($1M - $10M Property Size) Revenue Opportunity Current 1.5% $50 Million 5% $155 Million 10% $310 Million 25% $775 Million 33% $1 Billion 100% $3.1 Billion 0 500 1,000 1,500 2,000 2,500 3,000 Annual Revenue (i
Slide 60: Commercial Property Sales Transaction Volumes Up 6.4% Year-Over-Year
Commercial Property Sales Transaction Volumes Up 6.4% Year-Over-Year in January; First Year over Year Gain in 14 Months Office, Retail, Industrial, Multifamily, and Hotel Sales Volume 125 400% Change from Previous Year 100 300% Billions of Dollars 75 200% 50 100% 20.9 22.3 25 0% 0 -100% Sales Volume
Slide 61: The largest rural real estate marketplace in the country
The largest rural real estate marketplace in the country
Slide 62: Land.com by the Numbers
Land.com by the Numbers 15% 10M 5 Year Revenue Average Monthly CAGR Visitors 8K+ Paid Clients 450K 50K Land Sale Comps Paid Listings in Database *CAGR 2018-2023. Traffic data from Google Analytics for Q4 23 Paid listing and client data from internal database as of 12/31/23.
Slide 63: Land.com Leads All Competitors in Traffic Share
Land.com Leads All Competitors in Traffic Share Land.com Network LandSearch LandFlip Network AcreValue 7.7M visits per month Homes And Land Land Broker MLS 3.3X our largest competitor Farm And Ranch LandHub - 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 Source: Sim
Slide 64: The largest business-for-sale marketplace in the U.S.
The largest business-for-sale marketplace in the U.S.
Slide 65: BizBuySell by the Numbers
BizBuySell by the Numbers 10% 38M 5 Year Revenue CAGR Annual Visits 2.8M Annual Leads Delivered 120K 150K Annual Sold Business Paid Listings Comps in Database *CAGR based on 12/31/23. Traffic data for 2023 from Google Analytics. Listing, Lead and Comp data from internal database as of 12/31/23.
Slide 66: Our Network Has More Traffic Than All Competitors Combined
Our Network Has More Traffic Than All Competitors Combined BizBuySell Network BusinessesForSale.com 4M FranchiseDirect FranchiseGator visits per month 15X BusinessBroker.net BizBen our largest competitor GlobalBX BusinessMart * BizBuySell Network traffic vs similar sites; Google Analytics; SimilarWe
Slide 67: Appendix
Oe] CoStar Group” Appendix
Slide 68: Non-GAAP Measures
Non-GAAP Measures For information regarding the purpose for which management uses the non-GAAP financial measures disclosed in this release and why management believes they provide useful information to investors regarding the CoStar Group Inc.’s (the “Company” of “CoStar Group”) financial condition
Slide 69: Reconciliation of Net Income to Non-GAAP Net Income - Unaudited
Reconciliation of Net Income to Non-GAAP Net Income - Unaudited The following table presents a reconciliation of CoStar Group’s, Non-GAAP Net Income, including forward-looking guidance Non-GAAP Net Income, to the most directly comparable GAAP financial measure, net income. For the Year For the Year
Slide 70: Reconciliation of Net Income to Adjusted EBITDA - Unaudited
Reconciliation of Net Income to Adjusted EBITDA - Unaudited The following table presents a reconciliation of CoStar Group’s Adjusted EBITDA, including forward-looking guidance range Adjusted EBITDA for the full year ending December 31, 2023, to the most directly comparable GAAP financial measure, ne
Slide 71: Use of Operating Metrics and Other Definitions
Use of Operating Metrics and Other Definitions CoStar Group reviews a number of operating metrics to evaluate its business, measure performance, identify trends, formulate business plans and make strategic decisions. This presentation includes Net New Bookings. Going forward, CoStar Group expects to