ZG 10-K & 10-Q changes, risk factors and insider trading

Below is a summary of the principal factors that we believe make an investment in Zillow Group speculative or risky. This summary does not address all of the risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found after this summary, and should be carefully considered, together with other information in this Annual Report on Form 10-K and our other filings with the SEC before making an investment decision regarding Zillow Group, including an investment in our Class A common stock or Class C capital stock.

•Our business has been and may continue to be impacted by the health and stability of the economy and United States residential real estate industry, including inflationary conditions, interest rates, housing availability and affordability, changes to industry standards and practices, labor shortages and supply chain issues.

•We may not be able to establish or maintain relationships with listing and data providers, including MLSs, which could adversely affect traffic to our mobile applicationsapps and websites.

•We are exposed to risks related to our targetssustainability-related public statements, disclosures, targets, and disclosuresproduct related to ESG matters.features.

•Our dedication to making decisions based primarily on the best interests of ourconsumers customersmay andnegatively disputes regarding the accuracy or display ofimpact our Zestimates and Rent Zestimates may harm our business.results.

•Acquisitions,Mergers, acquisitions, investments, strategic partnerships, capital-raising activities, or other corporate transactions or commitments by us or our competitors could harm our business.

•We may be unable to adequately protect or continue using our intellectual propertyproperty, or prevent others from copying, infringing upon, using in generative AI or machine learning,learning systems, or developing similar intellectual property.

•We may be involved inface costly intellectual property disputesdisputes, andincluding mayclaims bethat unablewe toinfringe adequatelythe protectrights ourof intellectual property.others.

•We are, from time to time, involved in claims, suits, government investigationsinvestigations, enforcement actions, and other proceedings that may result in adverse outcomes.outcomes, including reputational harm.

•We may not be able to pay our debt,debt settle conversions of our Notes, or repurchase our Notes upon a fundamental change.obligations.

•The credit facilities that provide capital for Zillow Home Loans may subject us to interest rate risk and include provisions that may restrict our operating activities and harm our liquidity.

Risks Related to Ownership of Our Common Stock, Capital Stock and Notes

•Any additional equity securities or securities convertible debtinto equity we issue may dilute shareholders’ investments.

•Repurchases of our stock and Notes could affect the price of suchour securities.stock.

Our business is subject to numerous risks. You should carefully consider the following risk factors, as any of these risks could harm our business, results of operations, and future financial performance. Recovery pursuant to our insurance policies may not be available due to policy definitions of covered losses or other factors, and available insurance may be insufficient to compensate for damages, expenses, fines, penalties, and other losses we may incur as a result of these and other risks. In addition, risks and uncertainties not currently known to us or that we currently deem to be immaterial may materially and adversely affect our business, financial condition and operating results. If any of these risks occur, the trading price of our common stock and capital stock could decline, and you could lose all or part of your investment.

The success of our business depends, directly and indirectly, on the health of the United States residential real estate market. The health of the United States residential real estate market is affected, in part, by general economic conditions beyond our control. Recent market factors, including low housing inventory, volatilityelevated inand volatile mortgage interest rates, home price fluctuations, inflationary conditions, and changes in rental inventory and occupancy rate fluctuationsrates have impacted demand for our products and services by consumers and advertisers, which in turn has impacted our financial performance. The extent to which these and additional economic factors, such as those described below, impact our operating results and financial position will depend on future developments, which are uncertain and difficult to predict:

•natural and man-made disasters and other catastrophic events, such as pandemics, hurricanes, earthquakes, wildfires, floods, terrorist attacks and other events that disrupt local, regional, or national real estate markets.

The residential real estate industry is a highly-regulated industry and faces significant pressure from private lawsuits and investigations by the Department of Justice (the “DOJ”) with regards to antitrust and other issues,scrutiny, including with respect to lawsuits and investigations to which we are not a named party, such as the NAR Class Action discussed below.party.

Beyond the NAR Class Action and various similar private actions, beginning in 2018, the Department of Justice (“DOJ”) commencedhas ansought to continue its investigation into NAR for violations of the federal antitrust laws.laws, The DOJ and NAR appeared to reachfollowing a resolution in November 2020, resulting in the filing of a Complaint and Proposed Consent Judgment2020 pursuant to which NAR agreed to adopt certain rule changes, such as increased disclosure of commission offers. The DOJ has since sought to continue its investigation of NAR. It is uncertain what effect,further actions, if any, the resumptionDOJ ofmay thetake DOJ’sor investigationwhat willeffect any such actions could have on the larger real estate industry, including any further settlement or any decisions that may result therefrom to repeal, amend, or not enforce existing rules and regulations. BeyondOngoing monetaryregulatory damages,scrutiny, thelitigation, variousand classpressure action suits seek to change real estatefrom industry practices and,participants, along with the DOJlawsuits investigation,and havesettlements prompteddescribed above, may continue to prompt NAR, state and local real estate boards or MLSs, and other real estate market participants to discussevaluate and consider changes tomodify long-established practices, rules and regulations.

Although industry changes arising from these lawsuits and investigations are uncertain and challenging to predict, they could result in outcomes that materially impact our business, financial condition, and results of operations. For example, if agent commissions are meaningfully impacted, it could reduce the marketing budgets of real estate partners or reduce the number of real estate partners participating in the industry, which could adversely affect our financial condition and results of operations. Ongoing industry change and litigation may cause more industry participants to evaluate their strategic options and may lead to higher levels of industry consolidation than has been customary.

•keep pace with and anticipate changes in technologytechnology, including AI, and the real estate industry to provide industry-leading products and services to real estate partners and customers; and

Residential revenue accounted for 71%66% of total revenue for the year ended December 31, 2025. Rentals revenue accounted for 24% of total revenue for the same period, representing 39% growth as compared to the year ended December 31, 2024. This level of revenue concentration and growth suggests that even modest decreases in individual spending across the real estate partner population, caused by changes in the perception of our business, products, or services; actual or perceived decreases to return on investment,investment; preference for a competitive product or service,service; or other factors, could have a significant negative impact on our ability to use proceeds generated from our Residential products and services to invest in our other products and services, which we view as a key competitive advantage. Any such decreases in spending could also adversely affect our results of operations. We do not have long-term contracts with many of our real estate partners. Our real estate partners could choose to modify or discontinue their relationships with us with little or no advance notice. For example, our auction-based account interface forallows Premier Agent partners allowscertain agent partners to independently control the duration of their advertising commitments for varying terms.

We may not succeed in retaining existing real estate partners’ spending or capturing a greater share of such spending if we are unable to convince real estate partners of the effectiveness or superiority of our products and services as compared to alternatives. In addition, we continually evaluate and utilize various pricing and value delivery strategies in order to better align our revenue opportunities with the growth in usage of our mobile apps and web platformswebsites, and in customer transactions. For example, we offer a pay for performance pricing model called “Flex”Zillow Preferred for Premier Agentagent partners in certain markets. With the FlexZillow Preferred model, Premier Agentagent partners are provided with leads at no initial cost and pay a performance advertising fee only when a real estate transaction is closed with one of the leads. With this pricing model, the transaction price represents variable consideration, as the amount to which we expect to be entitled varies based on the number of leads that convert into real estate transactions and the value of those transactions. To estimate variable consideration and revenue associated with the FlexZillow Preferred model, we use a number of assumptions, including estimating the conversion rate of a lead to a real estate transaction, estimating the velocity of conversions and estimating the fee amounts likely to be received. We use similar performance based models for our rentals pay per leasePay-Per-Lease and StreetEasy Experts products.

Our estimates of variable consideration are primarily developed based on historical data and our future expectations based on current market trends. Our estimation methodology may be inaccurate and some or all of the revenue we recognize when our performance obligations are satisfied may be reversed. Realization of performance-based revenue is also in part dependent on accurate reporting and remittance by our partners.

Our ability to attract customers to our mobile applications,apps, websites and other tools depends to some degree on providing timely access to comprehensive and accurate real estate listingslistings, listing media, and information. To provide these listings and this information, we maintain relationships with real estate brokerages, real estate listing aggregators, MLSs, property management companies, home builders, other third-party listing providers and homeowners and their real estate agents (collectively, “real estate listing providers”) to include listing data and listing media in our services. Many of our agreements with real estate listing providers may be terminated with limited notice or cause, and following any termination, we may not be able to establish relationships with other real estate listing providers to receive comparable listings and information on reasonable terms, or at all. Many of our competitors and other real estate websites have similar access to MLSs and listing data and may be able to source certain real estate information faster or more efficiently than we can. Our competitors and real estate market participants may engage in exclusionary conduct that limits our ability to effectively compete, such as by restricting access to proprietary listing data or by putting homes for sale on a private listing network instead of publicly through the MLS. Another industry participant or group could create a new listings data service, which could impact the relative quality or quantity of information of our listing providers. The loss of existing relationships with real estate listing providers, whether due to termination of agreements, loss of MLS memberships, or otherwise, changes to our rights to use or timely access listing data or an inability to continue to add new listing providers or changes to the way real estate information is shared, may negatively impact our listing data quality.quality or the development and functionality of certain products or services that rely on such data. This could markedly decrease the quantity and quality of the for sale and rental listing data and other real estate information that we provide, reduce customer confidence in our products and services and cause customers to go elsewhere for real estate listings and information, which could severely harm our business, results of operations and financial condition.

In addition to the information that we receive from real estate listing providers, we obtain certain real estate data, such as transaction history, property descriptions, tax-assessed value and property taxes paid, under licenses from other third-party data providers, including state and local governments. We use this data to enable the development, maintenance and improvement of our marketplace and information services, including Zestimates, Rent ZestimatesZestimates, BuyAbility and our living database of homes. We have invested significant time and resources to develop proprietary algorithms, valuation models, software and practices to use and improve on this specific data. WeOur ability to use, combine, analyze, and derive insights from third-party and public data, including through automated valuation models, analytics, machine learning, and AI-enabled systems, depends on the scope, durability, and continued availability of the rights granted to us under applicable licenses, contracts, and laws. Changes in laws, regulations, judicial interpretations, contractual terms, data provider practices, or data governance standards may belimit unableor prohibit certain current or future uses of data, including the training of models, generation of predictive or derivative outputs, or commercialization of products or features that rely on such data, even where we continue to have rights to access certainor ofdisplay thisthe underlying data. Any such limitations could require us to modify, retrain, suspend, or discontinue affected products or features; terminate data from vendorslicenses or government agencies if changes in local laws or regulations or other prohibitions on data sharing are implemented or because the quality and quantity of data available to these third parties changes, or because we violate (or are perceived to have violated) the agreements under which we obtainrenegotiate such data. We may also be unable to renew our licenses with these data providers or enter into new data license agreements, or we may be able to do so only on terms that are less favorable toterms; us,incur significant costs; or result in legal disputes or regulatory actions, any of which could harmadversely affect our abilitycompetitive to continue to develop, maintain and improve these information services and could harm our business,position, results of operationsoperations, andor financial condition. In addition, if a third-party data provider lacked authority to grant us certain rights, or if upstream restrictions are later asserted, we could face similar limitations or liabilities notwithstanding our contractual arrangements.

Our subsidiaries that access and use listings data through MLS memberships (the “MLS Members”) must comply with each MLS’s rules, compliance requirements and data license agreements to maintain their access to listings data and remain a member in good standing. Each MLS that the MLS Members belong to has adopted its own rules, policies, and agreement terms governing, among other things, how MLS data may be used and how listings data must be displayed on our websitesmobile apps and mobile applications.websites. The MLS Members are also subject to compliance operations requirements and, as a result, must respond to and resolve complaints or notices of non-compliance from the MLS or other MLS participants on required timelines. The MLS rules and compliance requirements may not contemplate multi-jurisdictional licensed brokerage entities. MLS rules vary among markets and are in some cases inconsistent between MLSs, such that we are required to customize our websites, mobile applications,apps, or services to accommodate differences between MLS rules and compliance requirements. Handling complaints received by the MLS Members across markets may create heightened operational or financial risks with short response and resolution deadlines. Complying with the rules and compliance requirements of each MLS requires significant investment, including personnel, technology and development resources, and the exercise of considerable judgment. Rules and compliance requirements of MLSs have changed and may becontinue changedto change across markets, including potential for targeted changes or interpretations in response to our operations, and at various times, including in response to industry litigation such as the NAR Settlement. As we release new products and services, including AI-powered experiences, the volume of MLS complaints and the complexity of MLS compliance reviews may increase, which could materially increase our compliance costs. If any of the MLS Members are deemed to be noncompliant with an MLS’s rules or to have provided improper responses to or resolution of complaints, they may face disciplinary sanctions by that MLS, which could include monetary fines, restricting, suspending or terminating our access to that MLS’s data, or other disciplinary measures. The loss or degradation of this listings data could materially and adversely affect traffic to our mobile applicationsapps and websites, which could severely harm our business, results of operations and financial condition.

If our data integrity suffers real or perceived harm, customers and real estate partners may decrease use or cease using our products and services, and we may be subject to legal liability.

Because homes represent significant investments, and many customer decisions regarding homes are data-driven, our ability to attract and retain users of our products and services is dependent upon our ability to publish, and reputation for publishing, accurate and complete residential real estate information, including the output of proprietary and third-party models, through our mobile applicationsapps and websites. As discussed above, a significant amount of the data we publish on our mobile applicationsapps and websites is derived from third parties, and we have limited ability to control the quality of the information we receive from them. We also publish a significant amount of customer-generated content, and our tools and processes designed to ensure the accuracy, quality and legality of such content may not always be effective. Data we generate independently are subject to error, unauthorized modification by way of third-party viruses and other factors. As the volume of data we publish increases, and potential threats to data quality become more complex, the risk of harm to our data integrity also increases. If our data integrity suffers real or perceived harm, or if user trust in the quality of our data declines, we may be subject to legal liability,liability or reputational damage and customers and real estate partners may decrease their use or cease using our products and services, which would harm our results of operations and financial condition.

Our success depends on our continued innovation to provide new, and improve upon existing, products and services that make real estate transactions faster, easier and less stressful for our customers and provide value to real estate, rental and mortgage professionals, home buyers and sellers and our other real estate partners. As a result, we must continually invest significant resources in technology and development to improve the attractiveness, competitiveness, and comprehensiveness of our products and services, enable more seamless and efficient real estate transactions, adapt to changes in technology and support new devices and operating systems. If we are unable to provide products and services that our customers want to use, on the devices they prefer, then those customers may become dissatisfied and use competitors’ mobile applications,apps, websites, products and services. If our customers begin to access more real estate information and services through other mediasources and we fail to innovate, our business may be negatively impacted. If we are unable to continue offering high-quality, innovative products and services, we may be unable to attract additional customers and real estate partners or retain our current customers and real estate partners, which could harm our business, results of operations and financial condition.

We face intense competition in each ofacross our linesproducts ofand business.services. We compete with a variety of real estate transaction service providers to attract customers engaging in real estate transactions and we also compete with traditional and online or mobile media sources to attract real estate partners. Please see “Competition” under Part 1, Item 1 of this Annual Report on Form 10-K for a general discussion of the competitive conditions in each offacing our businesses.business.

Competitors for our real estate transaction services include rental listing service providers, real estate brokers, real estate investors, mortgage lenders, mortgage brokers, financial institutions, and title and settlement service providers. Many of these competitors may have considerable competitive advantages, including longer operating histories, more extensive financial resources, stronger brand equity, greater technological capabilities, more industry experience and greater knowledge and expertise. As a result, these competitors may have an advantage in attracting customers, recruiting highly skilled personnel, developing new products and services, and growing or maintaining their businesses. They may also provide customers with real estate transaction services and experiences superior to or more cost-effective than ours. Any of our current or future competitors could merge with each other or a separate entity, which may enable them to compete with us even more vigorously and acquirerepresent a greater share of consumer engagement, real estate transactionslistings, and consumer engagement.transactions.

WeAdditionally, we compete against mobile applicationsapps and websites dedicated to providing real estate, rental, new construction and mortgage informationinformation, listings and services to real estate professionals and customers, major internet portals, general search engines, e-commerce and social media sites as well as other technology and media companies. We also compete for a share of our real estate partners’ overall marketing budgets with traditional media such as television, magazines, newspapers and home/apartment guide publications, particularly with respect to advertising dollars spent at the local level by real estate professionals to advertise their qualifications and listings. Large companies with significant brand recognition have large numbers of direct sales personnel and substantial proprietary advertising inventory and mobile applicationapp and website traffic, which may provide a competitive advantage. Emerging AI-based search, recommendation, and assistant tools may change how consumers discover, evaluate, or transact in residential real estate, potentially reducing traffic to traditional online real estate platforms or altering engagement patterns in ways that negatively affect our advertising, lead-generation, or transaction-related revenues. To compete successfully for real estate transaction partners against future and existing competitors, we must continue to invest resources in developing our advertising platform and proving the effectiveness and relevance of our advertising products and services. Pressure from competitors seeking to acquire a greater share of our real estate partners’ overall marketing budget could adversely affect our pricing and margins, lower our revenue and increase our technology and development and sales and marketing expenses.

If we are unable to compete successfully against our existing or future competitors, we could lose or fail to gain revenue and our business, results of operations or financial condition would be harmed. Further, our business model depends on our ability to continue to attract users to our mobile applications,apps, websites, real estate services and other services and enhance their engagement with our products and services in a cost-effective manner. Search engines are evolving and changes to their models or algorithms may negatively impact our placement or require greater investment of resources to optimize our placement and attract customers. If the use of online products and services for shopping, renting, buying, selling, or financing residential real estate does not continue to develop and grow or we are not able to continue to attract users to our mobile applications,apps, websites, real estate services and other services, our business, results of operations and financial condition could be harmed.

The industry for residential real estate transaction services, technology, information marketplaces and advertising is dynamic, and the expectations and behaviors of customersconsumers and professionals shift constantly and rapidly. We continue to learnadapt a great deal aboutto the behaviors and objectives of residential real estate market participants as the industry evolves and invest significant resources to develop, test and launch products and services to address the needs of the market and improve the home buying, selling, financing, building and renting experience. We may not successfully anticipate or keep pace with industry changes, and we may invest considerable financial, personnel and other resources to pursue strategies that do not ultimately prove effective such that our business and financial condition may be harmed. Changes or additions to our products and services, including expansion of existing products and services into new markets or acquisitions of providers of additional products or services, may not attract or engage our customers, may reduce confidence in our products and services, may negatively impact the quality of our brands, may upset our partners or other industry participants, may expose us to increased market or legal and regulatory risks, may subject us to new laws and regulations, and may result in reduced investor confidence or otherwise harm our business.

We provide products and services to customers throughout the United States and to a lesser extent, in Canada. In addition, Zillow Home Loans originates loans in 49 states and the District of Columbia. Although the majority of our workforce has shifted to a distributed work environment, we maintain offices and large employee populations, including those supporting our licensed operations, in cities including Seattle, Washington; New York, New York; San Francisco, California; and Irvine, California; Denver, Colorado; Mexico City, Mexico and Belgrade, Serbia.California. The occurrence of a natural disaster, climate change or other catastrophic event such as a pandemic, health crisis, earthquake, hurricane, windstorm, fire, flood, power loss, telecommunications failure, cyber-attack, geopolitical instability, war, civil unrest, terrorist attack or other similar event in any of the markets in which we provide services or any locality in which we have a significant operational presence may disrupt our operations, impair local and regional real estate markets or economies and negatively impact our business, results of operations and financial condition. For example, while the impact was not significant, certain areas of our operations in our Enhanced Markets were affected by Hurricane Helene and Hurricane Milton in 2024.

Our dedication to making decisions based primarily on the best interests of customersconsumers may causenegatively usimpact toour forgo short-term gains.results.

Our guiding principle is to build our business by making decisions based primarily on the best interests of our customers,consumers, which we believe has been essential to our success in increasing our customer growth rate and engagement and has served the long-term interests of our company and our shareholders. InWe have forgone in the past, we have forgone, and we willmay in the future forgo, certain expansion or short-term revenue opportunities that we do not believe are in the best interests of customers,consumers, even if such decisions negatively impact our short-term results of operations. In addition, our philosophy of putting customersconsumers first may negatively impact our relationships with our existing or prospective real estate partners. This could result in a loss of real estate partners, which could harm our results of operations. For example, we require Premier Agentagent partners participating in our FlexZillow modelPreferred program to achieve certain performance standards designed to help ensure customers have a positive experience. Our customerconsumer focus may also negatively impact our relationships with real estate brokerages, MLSs, and other industry participants on whom we rely for listings information. Zillow Home Loans and some of our business-to-business products, for example, may be perceived as impinging upon the business models of real estate agents, brokerages and lenders, which may cause them to terminate or decrease the scope of their relationships with us. Such risks could have a materially negative impact on our results of operations. Our principle of making decisions based primarily on the best interests of customersconsumers may not result in the long-term benefits that we expect, in which case our user traffic and engagement, business and results of operations could be harmed.

We provide our customersconsumers with Zestimate and Rent Zestimate home and rental valuations. ZestimatesThe areZestimate is our estimated current market valuesvalue of a home based on our proprietary automated valuation models that apply advanced algorithms to analyze our data; theyit areis not appraisals.an appraisal. A Rent Zestimate is our estimated current monthly rental pricevalue of a home, using similar automated valuation models that we have designed to address the unique attributes of rental homes. We are, from time to time, involved in disputes with property owners and others who disagree with the accuracy or display of a Zestimate or Rent Zestimate, and such disputes may result in costly litigation in the future. Further, revisions to our automated valuation models or the algorithms that underlie them, poor data quality, or other factors may cause certain Zestimates or Rent Zestimates to vary from expectations for those associated properties’ values. Any such dispute or variation in Zestimates or Rent Zestimates could result in distraction from our business, loss of customers, or potentially harm our reputation and financial condition. Among other things, we may be subject to proposed legislation that may impose liability for, or require disclosure of, our proprietary algorithms, which could impact our competitive advantage and potentially harm our financial position or business results. This legislation could also result in an increased occurrence of enforcement actions or legal disputes as discussed above.disputes.

We believe our success has depended, and continues to depend, on the efforts and talents of our management and our highly skilled team of employees, including our software engineers,developers and engineers; data scientists,scientists and engineers; machine learning, applied science and AI operations professionals; platform, cloud, and reliability engineers; technical product managers; shared services staff,staff; loan officers,officers; statisticians,statisticians; marketing professionals and advertising sales staff.staff; and our customer operations, legal, compliance, privacy, and information security teams. Our future success depends on our continuing ability to attract, develop, motivate and retain highly qualified and skilled employees. The loss of any of our senior management or key employees could materially adversely affect our ability to build on the efforts they have undertaken and to execute our business plan, and we may not be able to find adequate replacements. The market for highly skilled personnel is very competitive. We cannot ensure that we will be able to retain the services of any members of our senior management or other key employees. Furthermore, we have in the past and may in the future take measures in order to slow attrition. Such measures could cause us to incur significant expenses or could have a dilutive effect on the economic interest of our shareholders. For example, to support retention of employees, in August 2022, we issued certain equity grants and repriced certain outstanding unvested stock options. If we do not succeed in attracting well-qualified employees, retaining and motivating existing employees in a cost-effective manner, or engaging in succession planning, our business could be harmed.

In addition, we believe that a key contributor to our success and our ability to retain highly skilled personnel has been our corporate culture, which we believe fosters innovation, teamwork, and an emphasis on customer-focusedconsumer-focused results. As we grow and evolve, we may find it difficult to maintain the beneficial aspects of our corporate culture, which could adversely affect our ability to attract and retain employees, continue to perform at current levels, or execute on our business strategy.

We continue to evaluate a wide array of potential strategic opportunities, including acquisitions and investments. For example, in recent years we have acquired VRXvarious Mediaentities, Group LLC in December 2022, Aryeo, Inc. in July 2023, Spruce Holdings, Inc. in September 2023,including Enchant, LLC, d/b/a Follow Up Boss,Boss in December 2023, and Virtual Staging AI Inc. in October 2024.2023. Any transactions that we enter into could be material to our financial condition and results of operation.operations. The transactions we pursue may not result in the intended benefits to our business, and we may not successfully evaluate or utilize the acquired products, technology, or personnel, or accurately forecast the financial impact of an acquisition transaction. The process of closing a transaction and integrating an acquired company, business or technology could create unforeseen operating difficulties and expenditures. Potential risks include: diversion of management time and focus from operating our business to acquisition closing and integration challenges; customer and industry acceptance of products and services offered by the acquired company; implementation or remediation of controls, procedures and policies at the acquired company; compliance with differing laws and regulations applicable to international jurisdictions, if applicable; coordination of product, engineering and sales and marketing functions; retention of employees from the acquired company; liability for activities of the acquired company before the acquisition; litigation or other claims arising in connection with the acquired company; and impairment charges associated with goodwill and other acquired intangible assets. For example, we have recognized impairment charges related to certain acquired intangible assets in the past. We may pay cash on hand, incur debt, or issue equity or securities convertible tointo equity to finance our acquisitions and investments, which could strain our liquidity, increase our operating costs, or result in dilution to our shareholders.

Third-party actors have attempted in the past, and may attempt in the future, to conduct fraudulent activity by engaging with our customers by, for example, posting fake real estate and rental listings on our sites and attempting to solicit personal information or money from customers, and by engaging with our employees by, for example, making fake requests for transfer of funds or sensitive information. We make a large number of wire transfers in connection with loan and real estate closings and process sensitive personal data in connection with these transactions. We also enable certain rental transactions through our Zillow Rental Manager products, which may be separately subject to a risk of fraudulent activity. ThoughWe we have sophisticatedemploy fraud detection and prevention processes and have taken other measuresdesigned to identify and respond to fraudulent activity onacross our mobile applications, websitesplatforms and internal systems,operations; wehowever, these measures may not be able to detect andor prevent all suchfraudulent activity. Similarly, the third parties we use to effectuate these transactions may fail to maintain adequatecontrols controlsconsistent with our expectations or systemscontractual requirements, or otherwise fail to detect and prevent fraudulent activity. Persistent or pervasive fraudulent activity may cause customers and real estate partners to lose trust in us and decrease or terminate their usage of our products and services, or could result in financial loss, thereby harming our business and results of operations.

The payment methods that we offer also subject us to potential fraud and theft by criminals, who are becoming increasingly sophisticated,sophisticated seekingin their attempts to obtain unauthorized access to or exploit weaknesses that may exist in the payment systems. If we fail to comply with applicable rules or requirements for the payment methods we accept, or if payment-related data are compromised due to a breach of data, we may be liable for significant costs incurred by payment card issuing banks and other third parties or subject to fines and higher transaction fees, or our ability to accept or facilitate certain types of payments may be impaired. In addition, our customers could lose confidence in certain payment types, which may result in a shift to other payment types or potential changes to our payment systems that may result in higher costs. If we fail to adequately control fraudulent payment transactions, we may face civil liability, diminished public perception of our security controls, and significantly higher credit card-related costs, each of which could harm our business, results of operations and financial condition.

Our portfolio of affiliates, subsidiaries and brands includes Zillow, Zillow Premier Agent, Zillow Home Loans, our mortgage origination operations and affiliate lender, Zillow Rentals, Zillow New Construction, Trulia, StreetEasy, HotPads and Out East.East, In addition, Zillow Group provides a comprehensive suite of marketing software and technology solutions for the real estate industry, including ShowingTime+, Spruce andHotPads, Follow Up Boss.Boss, ShowingTime, dotloop and Zillow Closing.

Our financial performance is impacted by changes in the health of the housing market, which is impacted, in turn, by general economic conditions. Current market factors have been driven by low housing inventory, volatilityelevated inand volatile mortgage interest rates, volatilitychanges in rental inventory and occupancy rates, as well as home price fluctuations and inflationary conditions. These factors may impact the number of transactions consumers complete using our products and services and demand for our advertising services. According to residential real estate data collected and estimatedpublished by Zillow Group, as published monthly on our site,NAR, TTV increased 6%3% during the year ended December 31, 20242025 as compared to the year ended December 31, 2023.2024. We continue to invest in the growth of our business, which we believe has resulted in year over year total revenue results, described below, for the year ended December 31, 20242025 as compared to the year ended December 31, 2023,2024, that exceeded industry performance for the same period. The extent to which market factors impact our results and financial position will depend on future developments, which are uncertain and difficult to predict.

On December 8, 2023, we acquired Follow Up Boss, a customer relationship management system for real estate professionals. Follow Up Boss revenue isprimarily generatedconsists throughof our SaaS customer relationship management system which provides real estate agents, teams and brokerages with a central hub to manage real estate transactions from connection to close. For additional information on the Follow Up Boss acquisition, see Note 6 in our Notes to the Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-K.

For the years ended December 31, 20242025 and 2023,2024, we generated total gross profit of $1.7$1.9 billion and $1.5$1.7 billion, respectively, representing a year-over-year increase of 12%, due to the combined factors discussed above.12%.

The number of visits is an important metric because it is an indicator of consumers’ level of engagement with our mobile applications,apps, websites and other services. We believe highly engaged consumers are more likely to use our products and services, including Zillow Homes Loans, or be transaction-ready real estate market participants and therefore more sought-after by our Premier Agent partners.

We define a visit as a group of interactions by users with our Zillow, Trulia and StreetEasy mobile applicationsapps and websites. A single visit can contain multiple page views and actions, and a single user can open multiple visits across domains, web browsers, desktop or mobile devices. Visits can occur on the same day, or over several days, weeks or months.

PriorZillow and StreetEasy measure visits using an internal measurement tool, and Trulia measures visits with Adobe Analytics. Visits to Trulia end after thirty minutes of user inactivity. Visits to Zillow and StreetEasy end after thirty minutes of user inactivity or at midnight. From January 1, 2024 through June 30, 2024, we measured visits to ZillowStreetEasy andusing Google’s Universal Analytics. Since July 1, 2024, we have measured visits to StreetEasy using thean Universal Analytics version of Google Analytics’ trafficinternal measurement platform.tool. Through Universal Analytics, visits to Zillow and StreetEasy ended either: (i) after thirty minutes of user inactivity or at midnight; or (ii) through a campaign change. A visit ends through a campaign change if a visitor arrived via one campaign or source (for example, via a search engine or referring link on a third-party website), left the mobile applicationapp or website, and then returned via another campaign or source.

We believe that using an internal measurement tool to measure visits to Zillow and StreetEasy allows us to maintain control over and provide greater insight into our end-to-end data as we enhance our broader long-term analytics strategy, while also becoming less reliant on third-party providers. We have recast prior period visits to Zillow to conform with the current period measurement methodology. The change in our measurement platform for visits resulted in an approximately 10% decrease in reported visits for the year ended December 31, 2023, primarily driven by the methodology for campaign changes.

The following table presents the number of visits to our mobile applicationsapps and websites for the periods presented (in millions, except percentages), recast for the prior periods, as described above:

Measuring unique users is important to us because much of our revenue depends in part on our ability to connect home buyers and sellers, renters and individuals with or looking for a mortgage to real estate, rental and mortgage professionals, products and services. Growth in consumer traffic to our mobile applicationsapps and websites increases the number of impressions, clicks, connections, leads and other events we can monetize to generate revenue. For example, our revenue depends in part, on users accessing our mobile applicationsapps and websites to engage in the sale, purchase, renting and financing of homes, including with Zillow Home Loans, and a significant portion of our Residential revenue, Rentals revenue and Other revenue dependdepends on advertisements being served to users of our mobile applicationsapps and websites.

We count a unique user the first time an individual accesses one of our mobile applicationsapps using a mobile device during a calendar month and the first time an individual accesses one of our websites using a web browser during a calendar month. If an individual accesses our mobile applicationsapps using different mobile devices within a given month, the first instance of access by each such mobile device is counted as a separate unique user. If an individual accesses more than one of our mobile applicationsapps within a given month, the first access to each mobile applicationapp is counted as a separate unique user. If an individual accesses our websites using different web browsers within a given month, the first access by each such web browser is counted as a separate unique user. If an individual accesses more than one of our websites in a single month, the first access to each website is counted as a separate unique user since unique users are tracked separately for each domain.

We believe that using an internal measurement tool to measure unique users of Zillow, StreetEasy and HotPads allows us to maintain control over and provide greater insight into our end-to-end data as we enhance our broader long-term analytics strategy, while also becoming less reliant on third-party providers. We have recast prior period unique users for Zillow to conform to the current period measurement methodology. The change in our measurement platform for unique users resulted in an approximately 3% increase in reported unique users for the year ended December 31, 2023.

The following table presents our average monthly unique users for the periods presented (in millions, except percentages), recast for the prior periods, as described above:

We calculate For Sale revenue per TTV as total For Sale revenue for the relevant period divided by the aggregate TTV for the same period. TTV is calculated as the number of existing residential homes sold during the relevant period multiplied by the average sales price of existing residential homes sold during the same period according to residential real estate data collected and estimated by Zillow Group, as published monthly on our site.period.

(1) Estimate for the year ended December 31, 20242025 is as of January 2025.2026.

Loan origination volume is an important metric as it is a measure of how successful we are at the origination of mortgage loan products through our Zillow Home Loans mortgage origination operations, which directly impacts our Mortgages revenue. Loan origination volume represents the total value of mortgage loan originations closed through Zillow Home Loans during the period.

Total loan origination volume increased during the year ended December 31, 20242025 due to continued growth in Zillow Home Loans purchase loan originations.originations in line with our strategic priorities.

•Residential revenue increased $142$110 million, or 10%.7%. The increase in Residential revenue was partially driven by a 6%4% increase in Residential revenue per visit to $0.171$0.178 for the year ended December 31, 20242025 from $0.162$0.171 for the year ended December 31, 2024, primarily due to the inclusion of revenue from Follow Up Boss, which we acquired in December 2023, growth in our Premier Agent revenue primarilydriven due toby continued improvement in our ability to convertconnect connectionshigh-intent intocustomers transactions,to agents, an increase in ShowingTime+ revenue asdriven weby expandedincreasing adoption of our software services available toby sellers and listing agents, and continued growth in our new construction and Follow Up Boss revenue. We calculate Residential revenue per visit by dividing the revenue generated by our Residential offerings by the number of visits in the period. The increase in Residential revenue was also attributable to a 4%3% increase in the number of visits to 9.6 billion for the year ended December 31, 2024,2025, asfrom compared9.3 tobillion for the year ended December 31, 2023.2024. We expect Residential revenue to increase in absolute dollars during the three months ending March 31, 2026, primarily due to the impact of seasonality on the real estate market.

The following table summarizes net income (loss) and Adjusted EBITDA for each of the periods presented (in millions, except percentages):

To provide investors with additional information regarding our financial results, we have disclosed Adjusted EBITDA, a non-GAAP financial measure, in this Annual Report on Form 10-K. We have provided a reconciliation below of Adjusted EBITDA to net loss,income (loss), the most directly comparable GAAP financial measure.

We have included Adjusted EBITDA in this Annual Report on Form 10-K as it is a key metric used by our management and Board to measure operating performance and trends and to prepare and approve our annual budget. In particular, we believe the exclusion of certain expenses in calculating Adjusted EBITDA facilitates operating performance comparisons on a period-to-period basis.

•Adjusted EBITDA does not reflect impairment and restructuring costs;

•Adjusted EBITDA does not reflect the gain (loss) on extinguishment of debt;

Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including various cash flow metrics, net income (loss) and our other GAAP results.

The following table presents a reconciliation of Adjusted EBITDA to net income (loss) for each of the periods presented (in millions):

Cost of revenue consists of expenses related to operating our mobile applicationsapps and websites, including associated headcount-related expenses, such as salaries, benefits, bonuses and share-based compensation expense, as well as revenue-sharing costs related to our commercial business relationships, depreciation expense, and costs associated with hosting our mobile applicationsapps and websites. Cost of revenue also includes amortization costs related to capitalized website and development activities, amortization of software, amortization of certain intangible assets and other costs to obtain data used to populate our mobile applicationsapps and websites, and amortization of certain intangible assets recorded in connection with acquisitions, including developed technology. Cost of revenue also includes credit card fees and ad serving costs paid to third parties, direct costs to provide our rental applications product, and direct costs to originate mortgage loans, including underwriting and processing costs.

Cost of revenue increased $106$141 million, or 25%,27%, primarilydue driven byto increases of $58$87 million in lead acquisition costs primarily associated with our Redfin rentals syndication agreement, $18 million in depreciation and amortization expense primarily due to an increase in amortization of website development costs, $15$17 million in mortgagead loan processingserving costs due to increasedsupport purchasethe loangrowth originationof volume,our $10rentals million in lead acquisition costs related to partnerships,marketplace, $7 million in connectivitysoftware and hardware costs, $5$6 million in headcount-related expenses, including share-based compensation expense, as we continue to invest in human capital to grow our business, and $4 million in softwaremortgage andloan hardwareprocessing costs.

Gross profit increased by $185$206 million, or 12%, primarily due to an increase in revenue discussed above. Total gross margin decreased from 78%76% to 76%.74% primarily due to increased lead acquisition costs associated with our Redfin rentals syndication agreement.

As of MarchJune 31,30, 2026, we had 7,0587,232 employees, compared to 7,068 employees as of December 31, 2025.

Our financial performance is impacted by changes in the health of the housing market, which is impacted, in turn, by general economic conditions. Current market factors have been driven by low housing inventory, elevated and volatile mortgage interest rates, changes in rental inventory and occupancy rates, as well as home price fluctuations and inflationary conditions. These factors may impact the number of transactions consumers complete using our products and services and demand for our advertising services. According to residential real estate data published by NAR, TTV increased 2%6% during the three months ended MarchJune 31,30, 2026 as compared to the three months ended MarchJune 31,30, 2025 and increased 4% during the six months ended June 30, 2026 as compared to the six months ended June 30, 2025. We continue to invest in the growth of our business, which we believe has resulted in year over year total revenue results, described below, for the three monthsand six month periods ended MarchJune 31,30, 2026 as compared to the threesame monthsperiods endedin Marchthe 31,prior 2025,year, that exceeded industry performance for the same period.periods. The extent to which market factors impact our results and financial position will depend on future developments, which are uncertain and difficult to predict.

Residential. Residential revenue includes revenue generated from our agent and software offerings and revenue derived from our New Construction marketplace and StreetEasy for sale product offerings. Agent offerings include Zillow Preferred, Premier Agent market-based pricing, Zillow Preferred and Zillow Showcase. Software offerings primarily include Follow Up Boss, dotloop, and ShowingTime.

For the three months ended MarchJune 31,30, 2026 and 2025, we generated total revenue of $708$772 million and $598$655 million, respectively, an increase of 18%. The increase in total revenue was primarily attributable to the following:

During the three months ended MarchJune 31,30, 2026 and 2025, we generated gross profit of $519$562 million and $459$489 million, respectively, an increase of 13%.15%.

We have recast TTV and For Sale revenue per TTV for the twelve months ended MarchJune 31,30, 2025 to conform with the revised TTV methodology used for the twelve months ended MarchJune 31,30, 2026, described above. The change in methodology to calculate TTV resulted in an approximately 27%26% increase in TTV and 22%20% decrease in For Sale revenue per TTV reported for the twelve months ended MarchJune 31,30, 2025, primarily due to differences in existing residential homes sold and average sales price of existing residential homes sold for the period as collected and estimated by Zillow Group compared to as reported by NAR.

(1) Estimate for the twelve months ended MarchJune 31,30, 2026 is as of AprilJuly 2026.

During the three and six months ended MarchJune 31,30, 2026, total loan origination volume increased 97%,94% and 95%, respectively, compared to the three and six months ended MarchJune 31,30, 2025. This increase was primarily driven by the continued growth in Zillow Home Loans purchase loan originations in line with our strategic priorities.

•Mortgages revenue increased $23$36 million, or 56%,75%, primarily driven by a $26$38 million increase in mortgage originations revenue. The increase in mortgage originations revenue was primarily due to a 97%94% increase in total loan origination volume to $1.6$2.2 billion for the three months ended MarchJune 31,30, 2026 from $796$1.1 millionbillion for the three months ended MarchJune 31,30, 2025,2025. This increase was largely driven by continued growth in Zillow Home Loans purchase loan origination volume.volume Weas expectwe Mortgagescontinued revenue to increase in absolute dollars duringexpanding the threeintegrated monthstransaction ending June 30, 2026, primarily driven by continued growth in Zillow Home Loans purchase loan origination volume.experience.

•Rentals revenue increased $54$50 million, or 42%.31%. The increase in Rentals revenue was driven by growth in average monthly rentals unique visitors, which increased 20% to 36 million during the three months ended March 31, 2026 from 30 million during the three months ended March 31, 2025. We have estimated average monthly rentals unique visitors using Comscore data, which measures average monthly unique visitors on rental listings on Zillow, Trulia and HotPads mobile apps and websites, and on Realtor.com and beginning in February 2025, Redfin and its sites, including Rent.com and ApartmentGuide.com. The increase in Rentals revenue was alsoprimarily due to ana 18%28% increase in quarterly revenue per average monthly rentals unique visitor to $5.08$5.65 for the three months ended MarchJune 31,30, 2026 from $4.30$4.42 for the three months ended MarchJune 31,30, 2025, primarily driven by a 57%42% increase in multifamily rentals revenue due to growth in multifamily property listings and in revenue per property as property managers upgraded to more comprehensive advertising packages. We calculate quarterly revenue per average monthly rentals unique visitor by dividing total Rentals revenue for the period by the average monthly rentals unique visitors for the period and then dividing by the number of quarters in the period. The increase in Rentals revenue was also driven by growth in average monthly rentals unique visitors, which increased 3% to 37 million during the three months ended June 30, 2026 from 36 million during the three months ended June 30, 2025. We have estimated average monthly rentals unique visitors using Comscore data, which measures average monthly unique visitors on rental listings on Zillow’s, Trulia’s and HotPads’ mobile apps and websites, and on Realtor.com and beginning in February 2025, Redfin and its sites, including Rent.com and ApartmentGuide.com. We expect Rentals revenue to increase in absolute dollars during the three months ending JuneSeptember 30, 2026, primarily driven by continued growth in multifamily revenue from the addition of new rental properties.

The following table summarizes net income (loss) and Adjusted EBITDA (in millions, except percentages):

To provide investors with additional information regarding our financial results, we have disclosed Adjusted EBITDA, a non-GAAP financial measure, in this Quarterly Report on Form 10-Q. We have provided a reconciliation below of Adjusted EBITDA to net income,income (loss), the most directly comparable GAAP financial measure.

•Adjusted EBITDA does not reflect income taxes; and

Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including various cash-flow metrics, net income (loss) and our other GAAP results.

The following table presents a reconciliation of Adjusted EBITDA to net income (loss) for each of the periods presented (in millions, unaudited):

Cost of revenue increased $50$44 million, or 36%,27%, primarily driven by increases of $38$29 million in lead acquisition costs, primarily associated with our Redfin rentals syndication agreement, $5$6 million in mortgage loan processing costs due to increased purchase loan origination volume, $4 million in software and hardware costs, $3 million in ad serving costs to support the growth of our rentals marketplace, and $3 million in softwareheadcount-related and hardware costs. We expect our cost of revenue to increase in absolute dollars during the three months ending June 30, 2026, primarily due to higher direct product and service costs, including increased lead acquisition costs associated with our Redfin rentals syndication agreement, as we continueexpenses to support loan fulfillment and processing costs driven by growth in revenue.Mortgages purchase loan origination volume.

Sales and marketing expenses increased $12$23 million, or 6%,10%, primarily driven by increases of $9$11 million in headcount-related expenses to support loan origination costs driven by growth in our Mortgages purchase loan origination volume.volume and $9 million in marketing and advertising costs as we continue to invest in the growth of our business. We expect sales and marketing expenses to increasedecrease in absolute dollars during the three months ending JuneSeptember 30, 2026,2026 primarilyas due to the impact of seasonality on the real estate marketmarketing and advertising spend normalizes following strategic increases in ourthe marketingfirst andhalf advertising costs to supportof the continued expected growth of our business.year.

Technology and development expenses increased $1$3 million, or 1%, primarily2%, due to a $5$9 million increase in software and hardware costs which was partially offset by aan $4$8 million decrease in headcount-related expenses driven primarily by a decrease in share-based compensation expense.

Other income, net decreased $6$5 million,million orand 27%,$11 million for the three and six months ended MarchJune 31,30, 2026, respectively, as compared to the three and six months ended MarchJune 31,30, 20252025, primarily due to lower interest income driven by a decrease in our investment balances as a result of share repurchases and the settlement of the 2025 Notes.

We are subject to income taxes in the United States (federal and state) and certain foreign jurisdictions. As of MarchJune 31,30, 2026 and December 31, 2025, we have provided a valuation allowance against our net deferred tax assets that we believe, based on the weight of available evidence, are not more likely than not to be realized. There is a reasonable possibility that within the next several quarters, sufficient positive evidence will become available to demonstrate that a significant portion of the valuation allowance against our U.S. net deferred tax assets will no longer be required. We have accumulated federal tax losses of approximately $1.8 billion as of December 31, 2025, which are available to reduce future taxable income. We have accumulated state tax losses of approximately $70 million (tax effected) as of December 31, 2025.

Income tax expense was not material for the three monthsand six month periods ended MarchJune 31,30, 2026 or 2025.

Our primary sources of liquidity and capital resources are cash flows from operations,operations and debt financing and equity offerings.financing. Our cash requirements consist principally of working capital, general corporate needs and mortgage loan originations. We continue to invest in the development and expansion of our operations using available cash flows from operations. Ongoing investments include, but are not limited to, improvements in our technology platforms, investments in new products and services, and continued investments in sales and marketing. We also use cash flows from operations to service our debt obligations and to repurchase Class A common stock, Class C capital stock, or a combination thereof through our Repurchase Authorizations or otherwise.

As of MarchJune 31,30, 2026 and December 31, 2025, we had cash and cash equivalents, investments and restricted cash of $788$688 million and $1.3 billion, respectively. Cash and cash equivalents balances consist of operating cash on deposit with financial institutions, money market funds, and, from time to time, U.S. government treasury securities and commercial paper. Investments consist of fixed income securities, which include investment grade corporate securities, U.S. government treasury securities, investmentcommercial grade corporate securitiespaper, and U.S. government agency securities. Restricted cash primarily consists of amounts used to fund customer home purchases in our mortgage origination operations. Amounts on deposit with third-party financial institutions exceed the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation insurance limits, as applicable. As of MarchJune 31,30, 2026, Zillow Group and its subsidiaries were in compliance with all debt covenants specified in the facilities described below.

For the threesix months ended MarchJune 31,30, 2025,2026, net cash provided by operating activities was $104$211 million. This was primarily driven by net income of $8$42 million, adjusted by share-based compensation of $97$169 million, depreciation and amortization of $65$130 million, amortization of contract cost assets of $5$13 million, amortization of right of use assets of $2$4 million, and $5$13 million in other adjustments to reconcile net income to net cash provided by operating activities. Changes in operating assets and liabilities decreased net cash provided by operating activities by $68$134 million. The changes in operating assets and liabilities are primarily related to a $38$108 million increase in mortgage loans held for sale due to the timing of loan sales, a $94 million increase in prepaid expenses and other current assets primarily due to an increase in accrued revenue, a $26 million increase in mortgage loans held for sale due to an increase in purchase loan origination volume, an $11 million increase in accounts receivable primarily due to an increase in revenue from products and services billed in arrears, a $7$13 million increase in contract cost assets primarily due to an increase in capitalized sales commissions, a $5 million decrease in accrued compensation and benefits driven by the timing of payments, and a $2$7 million decrease in lease liabilities due to contractual lease payments.payments, and a $4 million decrease in deferred revenue. These changes were partially offset by a $9$49 million increase in accrued expenses and other current liabilitiesliabilities, a $36 million increase in accounts payable, and a $32 million increase in accrued compensation and benefits, each primarily driven by the timing of payments, an $8 million increase in deferred revenue attributable to the timing of revenue recognition, and a $5 million increase in accounts payable driven by the timing of payments.

Cash Flows Provided By (Used in) Investing Activities

For the threesix months ended MarchJune 31,30, 2026, net cash provided by investing activities was $376$325 million. This was primarily related to $420$414 million of net proceeds from maturities and sales of investments, partially offset by $44$89 million of purchases of property and equipment and intangible assets.

For the threesix months ended MarchJune 31,30, 2025, net cash usedprovided inby investing activities was $52$25 million. This was primarily related to $144$213 million of net proceeds from maturities and sales of investments. These inflows were partially offset by $188 million of purchases of property and equipment and intangible assets, including a $100 million payment in connection with the partnership we entered into with Redfin in February 2025. These outflows were partially offset by $92 million of net proceeds from maturities and sales of investments.

For the threesix months ended MarchJune 31,30, 2025,2026, net cash used in financing activities was $219$731 million, which primarily related to $250$826 million of cash paid for share repurchases and $30$27 million related to the settlement of the acquisition date fair value of the firstsecond Follow Up Boss contingent consideration earn out payment. The cash outflows were partially offset by $33 million of proceeds from the exercise of option awards and $28$101 million of net borrowings on our master repurchase agreements related to Zillow Home Loans.Loans and $23 million of proceeds from the exercise of stock options.

To provide investors with additional information regarding our liquidity, we have disclosed Adjusted free cash flow, a non-GAAP financial measure, in this Quarterly Report on Form 10-Q. We have provided a reconciliation below of Adjusted free cash flow to net cash provided by operating activities, the most directly comparable GAAP financial measure. We define Adjusted free cash flow as net cash provided by operating activities adjusted for purchases of property and equipment, purchases of intangible assets, net borrowings (repayments) on master repurchase agreements, and the initial payment in connection with the Redfin rentals partnership. Borrowings (repayments) on master repurchase agreements are used to fund Zillow Home Loans mortgage loan originations, and we consider them part of our ongoing liquidity management. The initial payment in connection with the Redfin rentals partnership was considered a one-time and nonrecurring cash flow, and we exclude it from our calculation as we believe it impacts the ability to evaluate the liquidity of our business operations on a period-to-period basis.

On January 30, 2026, Zillow Group entered into a $500 million Revolving Credit Facility, which may be increased by up to an additional $250 million subject to the terms of the credit agreement. Borrowings under the facility bear interest at a floating rate based on either an alternative base rate, as defined in the credit agreement, or SOFR, in each case plus an applicable margin, determined by Zillow Group’s total net leverage ratio. The facility matures on January 30, 2031. As of MarchJune 31,30, 2026, no amounts were outstanding under the Revolving Credit Facility. Refer to Note 6 of our Notes to Condensed Consolidated Financial Statements of this Quarterly Report on Form 10-Q for additional information on our Revolving Credit Facility.

On March 4, 2026, the Board authorized the repurchase of up to an additional $1.25 billion of our Class A common stock, Class C capital stock, or a combination thereof, which increased our total cumulative Repurchase Authorizations to $4.8 billion as of MarchJune 31,30, 2026. On June 3, 2026, the Board approved an amendment to the Repurchase Authorizations, pursuant to which, effective June 3, 2026, no repurchase of shares under the Repurchase Authorizations is permitted if, after giving effect to such repurchase, any single shareholder would beneficially own more than 45% of the then-outstanding voting power of the Company’s voting securities. During the threesix months ended MarchJune 31,30, 2026, we repurchased 3.84.8 million shares of Class A common stock and 9.714.3 million shares of Class C capital stock at an average price of $47.84$45.25 and $45.92$42.52 per share, respectively, for an aggregate purchase price of $182$219 million and $444$607 million, respectively, totaling $626$826 million. As of MarchJune 31,30, 2026, $1.3$1.1 billion remained available for future repurchases of our stock pursuant to the Repurchase Authorizations, which repurchases decrease our liquidity and capital resources when effected.

Master Repurchase Agreements - Includes principal amounts due for amounts borrowed under the master repurchase agreements to finance mortgages originated through Zillow Home Loans. Principal amounts under the master repurchase agreements are due when the related mortgage loan is sold to an investor or directly to an agency. As of MarchJune 31,30, 2026, we have outstanding principal amounts of $335$465 million. Amounts exclude an immaterial amount of estimated interest payments.

Operating Lease Obligations - Our lease portfolio comprises operating leases for our office space. During the three months ended MarchJune 31,30, 2026, there were no material changes to our operating lease obligations disclosed in Note 7 in the Notes to the Consolidated Financial Statements in Part II, Item 8 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2025.