Good day and thank you for being here. Welcome to the Q1 2025 CoStar Group Earnings Conference Call. All participants are currently in a listen-only mode. Please note that this conference is being recorded. After the presentations, there will be a question-and-answer session. I will now turn the call over to your speaker today, Rich Simonelli, Head of Investor Relations.

Thank you so much, operator, and hello. Thank you all for joining us to discuss the first quarter 2025 results of the CoStar Group. Before I turn the call over to Andy Florance, CoStar's 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. 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. Reconciliations 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 the definitions for these terms. The press release is available on our website under costargroup.com in the Press Room. As a reminder, today's conference call is being webcast and you're on it. So the link is also available on our website under 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. Andy?

Good day and thank you for joining CoStar Group's first quarter 2025 earnings call. We posted another strong quarter with Q1 '25 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 range. Adjusted EBITDA was $66 million, a 429% increase over Q1 2024. Adjusted EBITDA also exceeded consensus and was at the top end of our guidance range. We achieved a very strong 43% profit margin in our Q1 '25 commercial real estate and information marketplace businesses that include CoStar, Apartments, LoopNet, STR Real Estate Manager, Land and BizBuysell in aggregate, coming at a 43% profit margin. Company net new bookings were $56 million in the first quarter of '25, up 6% sequentially from the fourth quarter of '24. Our international businesses have achieved three consecutive quarters of all-time net new bookings, reaching over $5 million ARR in Q1 '25, representing 56% year-over-year growth. We had 130 million average unique visitors to our global websites in Q1 '25 according to Google Analytics. CoStar achieved $265 million in revenue in Q1 '25. Revenue was up 6% year-over-year, while annualized net new bookings reached their highest level since Q3 '23, 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 by 17% year-over-year, largely driven by the migration of STR to the CoStar platform. 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 CRE debt. In less than three years, it has achieved an $80 million 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. Log-ins 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%. During the past few years and through today, we are operating in one of the worst commercial real estate environments in decades. Looking at investment-grade office, although absorption is improving, we are still seeing historic high vacancy rates of about 16%. Real asking rents of $36.64 sit at a 30-year low. Real sales price per square foot is a decade 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 rents. In retail, real asking rents are at 10-year lows. But I want to be clear, we see signs that the cycle is improving. Vacancy rates have hit their highest point and are beginning to fall. Availability rates have fallen by 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. 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. Tenants begin their search online and LoopNet is 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. This 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 LoopNet ad to the value of the property being advertised. Our pricing will reflect that a $1 billion, five-star office building in Manhattan derives more value from LoopNet than does a $100,000, two-star retail building in Montana. 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. In Q1 2025, we moved forward with the 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 a 50% year-over-year EBITDA growth for the combined brands. 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 leases 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 of real estate. CoStar continues to develop a data set of leases from both anonymized customer data from the leased brands and publicly available sources like the SEC and U.K. 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 an aggregated and anonymized basis. For the quarter, Land.com net new bookings increased by 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. In mid-March, Farmer Mac released the Farmer Mac Farmland Price Index powered by our recently acquired AcreValue. 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. BizBuySell 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 subscriptions. Subscription revenue from BizBuySell Edge, which offers entrepreneurs advanced tools and market insights, grew 48% year-over-year. 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. Apartments.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. We launched marketing campaigns to owners, specifically comparing our traffic, leads and leases to rent period with face-to-face follow-up with these communities with much success. We now have 80,000 multifamily listings on Apartments.com. The sales team maintained a 94 Net Promoter Score during the quarter. 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 by 23% this year to keep up with this potential. Since 2019, we've grown apartments revenue by 118% but only grown our sales reps in production by 56%. So we'll continue to accelerate our sales force 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. 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 NFL fans, you probably saw us last week on the NFL draft. Our campaign will also be featured throughout other profile shows during the Major League Baseball, NHL, and NBA seasons. We have increased our paid search efforts in the first quarter and will continue to do so throughout the year to attract more potential renters to our advertisers' communities by generating five times more number 1 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 to convert to more leases is the most important thing we do. In a 2025 brand study conducted by GovX, 47% of owners and operators surveyed said Apartments.com had a completely or very effective lead-to-lease conversion rate, which is 38% more than Zillow's and 160% more than Rent periods. 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. 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 2.7 times 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 high of 142,000 single-family rentals posted on the platform and assisted our independent owner clients by collecting $1.4 billion in rental payments. 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 the Matterport. Apartments.com is also benefiting from the increased traffic on Homes.com as Apartments.com paid advertisers also get exposure over Homes.com's rental area. 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. 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 competing residential portals in the U.S. 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 U.S., which are all based upon marketing the property, not an agent lead generation business model. The legacy competing unprofitable U.S. property portals are based upon lead diversion business models. These lead diversion models divert leads from 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 lead 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 neighboring schools that home shoppers cannot find on competing sites. 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 shoppers. 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 Gardner, 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. For Homes.com to be successful, home shoppers need to be aware of Homes.com and have the intention to use it. Our target audience of several hundred million home shoppers is massive. Before we launched in February '24, only 4% of that target audience, when asked, 'What home shopping websites can you think of?', replied Homes.com. In 14 months of marketing campaigns, we have steadily increased our unaided awareness ninefold to 36%. So we're now at 36% unaided awareness. Early last year, our unaided awareness surpassed Trulia. Last summer, we surpassed Redfin's unaided awareness. And last month, we crossed Realtor.com. When we began, Zillow was 64 points above our unaided awareness. We've closed the gap to 24 points and are still improving. Our unaided intention or the percentage of people surveyed that say they intend to use our site has grown from single digits to 26%. We've also crossed Realtor, Redfin, and Trulia on unaided intent. Zillow and Realtor have been trending down while we've been growing. 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 2 to 4 years, we can take a solid and 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 in the Homes.com network. In just 14 months, we built a Q1 '24 audience of 104 million average monthly unique visitors. That's according to Google Analytics. This now makes the Homes.com network one of the top two residential portals based on 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 improved 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. Members' listings sort to the top of their market, generally to the first page where 90% of all buyers click through to listings. We present their listings with our neighbor school content on competing listings and suggestion emails on our home page. With 1 billion visits to Homes.com in the past 12 months, we have unique insight into who’s 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. It is a comprehensive digital real estate marketing package no one else is offering. 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 in 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 track the listing win rate advantage for members closely and it's steadily climbing. Now, member agents are winning 61% more listings than before membership. Since the average value of winning a new listing is $15,000 and the monthly membership fee is less than $500, the ROI is outstanding. 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 1 million agents. 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. 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 believed 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. 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. In the last few months, our Net Promoter Scores have been surging upwards and have reached 43, which is in the great classification, and our early cancel or failed payment rate has dropped to between 0.25 and 2.5% per month, great progress. 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 by 65%. Since last May, our Net Promoter Score has soared over 85 points to sit in the great classification. Under the very strong leadership of our Senior Vice President of Sales, Andy Stearns, we have grown that small initial team of 50 dedicated sales reps, 600% over the last 14 months to 314 reps in production. Those reps with 4 months of production are turning in a steady 1,612 monthly net new revenue, which implies our 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 5 years of accounting. The sales force is still growing very rapidly with 64 more in training and with offers out to an additional 214 salespeople. In Q4, we anticipate we'll have 500 salespeople with 4 months of experience selling Homes.com, suggesting we could be adding over $800,000 a month in 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. Now we largely price based on seller listings. In April, month-to-date, our demo-to-close rate is 56%. So something is going right there. This is the highest monthly close 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 team's best net new bookings month to date and a $420,000 positive swing from the prior month. 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. I believe that by year-end, our Homes.com sales team will be our largest and will be turning in the most net new revenue of any CoStar Group product area in CoStar Group with regular $1 million net new months for Homes.com. 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 is sorted at the top of search results, receives a Matterport, and is retargeted across the Internet. 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, Boost 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 upsales to membership. We're also offering the Boost option directly to home sellers. These are home sellers with agents, but often home sellers want to purchase additional marketing tailwinds for their home for sale, purchasing tens of thousands of dollars' worth of Boost from portals to market their home for sale online. 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. In July, we expect to launch a new Homes.com marketing offering for homebuilders. This is an attractive market for us to enter because new construction represents approximately 20% of all homes sold in a given year, yet there's no great single place for consumers 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 homebuilders. We've already secured listing feeds representing 60% of the total available inventory and I expect this number will grow as we approach July. 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. We are carefully controlling expenses generally and with Homes.com specifically. In the first quarter, we realized 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. 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 and no co-mingling rules, I believe that our diversion competitors are getting anxious that brokers with more choice may increasingly choose to market their properties away from those lead diversion platforms. If the home is not listed on Zillow, Zillow loses the opportunity to use the listing to sell the buyer agency leads and take 40% of the buyer agent commission. We view this move not only as anticompetitive but also shows a bit of desperation. 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. In those most recent focus groups, one agent said, 'Everyone hates Zillow: buyers, sellers, agents, and brokers.' The word that many use to describe Zillow's approach is predatory. The decades of mistreatment have made agents desperate for a viable alternative, and they now have one: Homes.com. My favorite quote from 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, 'Everyone at my brokerage meetings, lawyers, brokers, commercial agents, everyone.' At the end of the one-year mark as we kicked off our sales efforts, I'm confident that Homes.com is a winning product. We're seeing excellent momentum in sales. If you look around the world at successful real estate portals that use our business model of marketing the real estate rather than lead diversion, the EBITDA opportunity is really impressive. The EBITDA normalized to the size of the U.S. GDP of market leaders like REA Group, Scout, Rightmove, Domain, Hemnet, and Idealista for the United States ranges between $1 billion of potential EBITDA to $9 billion of potential EBITDA, suggesting that the residential portal opportunity in the United States is a lot larger than the $79 million adjusted EBITDA number one of our competitors turned in, in 2024, about 100 times larger than that. On the market, head over the United Kingdom had another strong quarter. For 11 straight months, we've seen net new bookings growth equivalent to $7.2 million in annualized revenue. We are delivering fantastic ROI to agents who subscribe 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. 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 ten largest real estate marketplaces in the world. Domain is very profitable, growing, and is in a market with great dynamics for real estate portals with vendor or owner-paid models. 2024 annual revenue was $250 million, and using today's conversion rate, EBITDA was $88 million. Australia's real estate portals use the vendor-paid advertising model, unlike the competing U.S. portals, which have lead gen models for buyer agents. Australian portals generate revenue through marketing and real estate. Home sellers are regularly paying companies like Domain and REA anywhere from $3,000 to $50,000 to market their home for sale online. One element 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 blockers, social amplification, and retargeting. We will be adopting the best practices of Domain in the U.S. 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 has historically underinvested in the product. Simultaneously, REA Group's market dominance is not incentivized to innovate and improve their product. Both sites are not a comparison to the product we built with Homes.com. We will bring what we've built in Homes.com to Australia and the United Kingdom to win over consumers. 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 coverage in Australia. The Board of Domain is a majority shareholder, Nine Entertainment has backed our offer, and we're in the process of conducting due diligence. Of course, there is no guarantee that our proposal will result in a transaction. We closed the acquisition of Matterport at the end of February and we have been long-time users of Matterport, and I'm very excited to have the opportunity to work with RJ, Gausebeck, 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 that 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% annually and total square footage by over 30% each year. Our new goal is to reach a trillion square feet of digital twins, which requires 35% year-over-year growth. Their sales success was achieved with a small sales team but mighty at 47. 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. I want to close by doing something important, thanking our Board members, Mike Klein, Chris Nassetta, and others who are concluding their service on the CoStar Board. Through the years, they have offered excellent counsel and have been extremely valuable in helping us build CoStar Group into the global organization operating in 192 countries with a $34 billion market cap. Mike Klein and David Bonderman and I cofounded the business 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 startup concept. Turns out he was a genius; he is a visionary, and his support and counsel were matchless. As part of the ongoing refreshment of our Board, we made some important announcements earlier this month. Louise Sams, who has been a CoStar Board member since 2019, has been named Chair of the Board. She has strong international and legal experience, having served as EVP and General Counsel of Turner 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 Berisford, Rachel Glaser, and Christine McCarthy. 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 as 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 Move, Inc. I'll be chairing our new Board's Capital Allocation Committee, and John, Christine, and Robert Musslewhite 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, which has resulted in the company's outperforming 98% of NASDAQ companies since our IPO. And with my very brief remarks, I'm going to turn it over to Chris Lown.

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 was at the high end of our guidance and above consensus estimates. First quarter adjusted EBITDA came in at $66 million, and a 9% margin, also exceeding consensus and the high end of our guidance range. The outperformance in adjusted EBITDA was primarily due to the timing of marketing spend, lower personnel costs from cost-saving initiatives, and hiring timing. Matterport contributed an adjusted EBITDA loss of $2.7 million for the first quarter stub period. Our commercial information and marketplace brands delivered healthy 43% profit margins in the first quarter. This measure does not include our investments in Homes.com, on the Market, and Matterport. 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 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. 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 a 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%. For Q2 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 a 7% growth expected in the second quarter of 2025. We are increasing our guidance expectations for Q2 for 2025 and now expect revenue growth of 7% to 8% for the full year as growth accelerates throughout the year. Revenue from Information Services was $40 million in the first quarter. Revenue growth for the second quarter and full year is expected to be in the 18% to 20% range. Visual Lease's integration with Real Estate Manager is well underway and we're extremely excited about the lease benchmarking product and expect the 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 million to $280 million, with Matterport contributing $135 million to $140 million. Residential revenue was $27 million in the first quarter. First quarter sales reflected the nature 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 cancellations. 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 U.S. residential portal. 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. For the first quarter, CoStar posted a $15 million net loss due primarily to the one-time costs 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 the end of March. While much of the increase was concentrated in Homes.com, we are ahead of our sales headcount hiring plan across all of our brands. 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. 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. We still anticipate repurchasing $150 million of shares in total in 2025. On March 27, CoStar provided a nonbinding indicative offer to acquire Domain Group for AUD 4.43 per share. As part of this effort, we acquired 107 million shares at an average cost of AUD 4.22 or approximately USD 290 million. We now own 16.9% of Domain's outstanding shares and are in the process of performing due diligence and recently received a two-week extension to complete our due diligence by May 12. For the full year of 2025, we expect revenue of $3.115 billion 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 4 to 5 percentage point contribution from the Matterport acquisition. Second quarter 2025 revenue is expected in the $770 million to $775 million 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 million to $60 million, reflecting an adjusted EBITDA margin of around 7%. With that, I will now turn the call back over to the operator for questions.

Our first question comes from Alexei Gogolev with JPMorgan.

Andy, 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 Zillow's and the other reactions?

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 ensure 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 overreaction that probably shows a little bit of weakness. But I think it's being confused a little bit with something related to COMPASS. I don't think it is. It is unusual to see the NAR allowing a portal to try to set a new set of rules. This creates a good opportunity for us for sure.

And Chris, a quick follow-up on your guidance. Would you be able to tell us what was the nonresidential EBITDA margin in Q1? And if your outlook for residential spend for 2025 is still intact?

Yes. So the commercial margin was 43% for the first quarter. And as Andy mentioned, our...

Chris, that's impressive.

It's a 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 quarter 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. No change there.

Our next question comes from Pete Christiansen with Citi.

Good progress on a number of fronts here. Andy, and congratulations on closing Matterport. Can you walk us through the next 12, 18 months? If we could just double-click on how you envision Matterport being integrated into the CoStar platform and how you think about monetization of that product? And just curious on how do you think that Matterport evolves with CoStar over the next 12 to 18 months?

Sure. So Matterport is going to 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 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. And we will be embedding it deeply natively and building unique and special features in those product areas that make Matterport available with more power in those spaces. I've had a chance to meet many of the Matterport folks. I would say that they and I have a real common vision for some exciting R&D projects that I think will add a lot of value. I'm really amazed at how ubiquitous the value proposition is for Matterport. I'm just recently touring some construction over in Europe, and they've been using Matterport in the construction site every week. Matterport, up until recently, has only had about five salespeople to cover Europe, Asia, Africa, and all the world outside the United States. Clearly, I figure that those five salespeople had 1.3 million good prospects per salesperson. 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 while building it to a good margin and then also fund more aggressive R&D within the product.

Yes. I'd expand on that a little bit and also add that from a practical perspective, it will inevitably lower cancellations and improve products, right? As people have more time on site, they use it more. We hear people renting apartments with Matterports without going there physically. People looking for commercial real estate will travel less, and therefore, we will spend more time on site, and it will become more ubiquitous. So we believe real financial tailwinds will accrue as well as we, as Andy said, really deeply embed this application across all of our platforms, which will just strengthen the outcomes but also their financial outcomes as well.

Our next question comes from George Tong with Goldman Sachs.

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? How are you thinking about the $900 million and change originally targeted for the year?

Yes. 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. And so it's in line with plan, and there are no changes.

Our next question comes from John Campbell with Stephens.

Andy, I want to maybe circle back on CCP. I think you probably expect a lot of questions there. It does seem like as you're looking to position Homes.com as a site that 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 MLS or maybe it's just a straight connection or a feed into you guys. That seems pretty clear to me. But outside of that, I'm just curious about the other ways you're thinking about leaning in. I don't know if that's helping power maybe white-label the private listing networks or something along those lines. I'm just 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 Clear Cooperation has always been a thing. People since the beginning of time in real estate have marketed listings off market. People have always looked to see if there's someone in the shop, in the neighborhood, a connection that wants to buy a property, especially at the middle and upper end of properties. That happens in commercial real estate, and it happens around the world. Typically, 20% of listings around the world are going to be marketed off-market or private. I don't want to get too deeply into what COMPASS is doing or what eXp is doing, but just more as a general theme, I think that there is an important dynamic changing here with clear cooperation being more flexible and with the no co-mingling rules on the MLSs changing. You've got people beginning to question where they want their listings to go and when they want them to go there. And 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. So I think there's generally some anxiety on the part of some of those folks that 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 presenting their listings with their names on them and are not trying to rewrite the rules. 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 different firms on the strengths of Clear Cooperation, private networks and all that stuff. I think they do it anyhow and have done it since the beginning of time.

Our next question comes from Ryan Tomasello with KBW.

I wanted to double-click on multifamily. I guess, can you help us understand what's driving the growth deceleration 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? And considering the incentives you called out for prioritizing property growth, how should we consider the evolution there on pricing versus property count? And then just lastly, on bookings. I don't think we got any color on apartments bookings in the quarter. So anything you're willing to provide there would be helpful.

Yes. So you snuck in a couple of questions there. So remember, the second quarter is the big quarter for Apartments.com. That's when the big conference happens, in June, sort of the back end of the second quarter. So that flows through in the third and fourth quarters. So that's the dynamic that happens year in and year out. I think you have that dynamic, in addition to the additional headcount from a sales perspective. As Andy said, the rent period sales force is a fantastic sales force. They're actually already up and running. 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. Ensuring that the sales team is focused on the right things: rooftops is important, and pricing is important, but we feel good about that acceleration. So all 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. And we didn't provide a net new number for apartments, but you should assume a sort of mid-20s million range for net new bookings.

Our next question comes from Stephen Sheldon with William Blair.

On the suite, I guess, is your thinking about the degree of pricing increases changed at all? I think you've typically talked about roughly 3% to 5% annual uplift. But just given your dominant positioning there and continuing to add new data sets, new forms of value, could you potentially look to be more aggressive on that front in the coming years, especially if the CRE backdrop continues to improve?

I would emphasize that 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. 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. You 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, barring anything in 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.

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 where it's primarily a broker product with lender, with the lease benchmarking product that's coming with STR. I mean the value proposition about to create additional revenue streams or compound sort of the value is dramatically different. So the model has also changed with the new offerings to our advantage as we roll out those products and expand TAMs as well.

Our next question comes from Jeff Meuler with Baird.

It sounds like when you were talking about Homes.com attrition, a lot of that was like early cancels within a contract metrics. 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?

I don't have specific data on fall contracts that are up for a six-month renewal. However, I can tell you that the cancellation rate during this period has decreased significantly, reaching very low figures. For the last month of the six-month contract, the cancellation rate was just 0.25%, which is negligible. Previously, it was much higher, around 5% to 8%. I believe the initial high cancellation was due to the excitement surrounding the launch, where many expected to sell lead diversion without understanding the broader market demand for digital marketing in real estate. Now that we have a clearer picture, our sales force, although small and generalized, has shown strong performance, with a net promoter score in the 40 range. This promising development indicates that we can expect solid renewal rates moving 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 better to be asked in sort of the next three to six months as they start to roll forward.

I would now like to turn the call back over to Mr. Andy Florance for any closing remarks.

Well, 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. We look forward to updating you next quarter.

Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.