CoStar Group announced last week that revenue for the quarter ended September 30, 2017 was $248 million, an increase of 16% over revenue of $213 million in the third quarter of 2016.
Net income increased to $34 million, or $1.04 per diluted share, compared to $23 million in the third quarter of 2016, an increase of 48%. EBITDA in the third quarter of 2017 was $73 million, an increase of 26% over the third quarter of 2016.
“We built upon our solid momentum” during the quarter, “driving excellent growth with profitable revenue and strong sales,” said Andy Florance, CoStar Founder and Chief Executive Officer. He added that company-wide net new bookings continued to be exceptionally strong at $34 million in the third quarter of 2017, up 31% year-over-year.
“Our marketplace businesses are performing extremely well as we achieved year-over-year revenue growth of 25% in multifamily and 21% in commercial property and land during the quarter,” he continued. “CoStar Suite revenue accelerated to 14% year-over-year growth. Margins are also expanding, as we achieved 34% adjusted EBITDA margins in the third quarter, up 1,100 basis points from 23% in the second quarter of this year.”
Florance explained that the company has successfully completed the integration of its CoStar and LoopNet databases. “We converted LoopNet.com to a pure pay-to-list marketing site, eliminating free listings and creating more value for our paid listers,” he said. “Beginning in early October, our sales force hit the ground running with our focused cross-selling campaign to convert LoopNet information users to CoStar Suite and sell more paid advertising on LoopNet. In the first twelve days of the campaign, we closed over 500 deals. The response from our sales teams, clients, and prospects has been overwhelmingly positive. We believe this will ultimately result in significant revenue opportunities for the next several years.
Looking toward the end of the year, the company is raising its full year 2017 earnings and revenue guidance. CoStar Group expects revenue to be in a range of approximately $962 million to $965 million for the full year of 2017, increasing the midpoint of the revenue outlook by approximately $7 million. For the fourth quarter, the company expects revenue in a range of $251 million to $254 million.
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