Shares of real estate marketplace leader Zillow Group (NASDAQ:Z) (NASDAQ:ZG) bounced 15% today after the company reported third-quarter earnings last night. Shares have retreated some, but remain up more than 11% as of noon EST.
The company said revenue for each of its three segments exceeded the high end of its previous estimates.
The COVID-19 pandemic has caused people to rethink how their homes are used, and even where they want to live. Zillow's third-quarter results reflect the higher interest as the company's mobile apps and websites received 21% higher traffic in monthly unique users and 32% growth in visits, compared to the prior-year period.
The company reported revenue grew 24% in its largest, legacy, IMT segment -- short for internet, media, and technology. Zillow Group co-founder and CEO Rich Barton summarized the increased activity, saying in a statement, "Many of us are reevaluating where we live and how we live, which has kicked off a Great Reshuffling."
One blemish from the quarter was a 51% decline in its homes segment revenue. This includes the company's Zillow Offers iBuying business. But the company attributed that to impacts from earlier in the year, as home buying activities paused during the early months of the pandemic, resulting in lower inventory available for resale during the third quarter.
Even so, the company ended the quarter with its highest-ever level of cash and investments, at $3.8 billion.
Today's stock move is a continuation of a growth trend company shares have experienced through most of 2020. Returns from both share classes have exceeded 150% since the start of 2020. Third-quarter results have only accelerated investor optimism.