CoStar Group Full Year 2021 Revenue Increased 17% Year-over-Year and Fourth Quarter Net Sales Bookings Grew 37% to a Record $67 Million

Rhea-AI Summary

CoStar Group reported a strong financial performance for 2021, with revenue reaching $1.94 billion, a 17% increase from 2020. The fourth quarter saw revenue of $507 million, up 14%. Net income for the year rose 29% to $293 million, while fourth quarter net income surged 160% to $93 million. The company anticipates 2022 revenue between $2.145 billion and $2.165 billion, with significant investments planned for its residential products, potentially driving future growth.

Positive

• Revenue growth of 17% year-over-year in 2021.
• Fourth quarter revenue increased 14% to $507 million.
• Net income surged 29% year-over-year to $293 million.
• Fourth quarter net income rose 160% to $93 million.
• Strong EBITDA of $565 million, up 39% from 2020.
• Record net sales bookings of $67 million in Q4 2021.
• Plans for significant investment in residential products, indicating growth potential.

Negative

• Adjusted EBITDA for 2022 expected to decline by 10% compared to 2021.
• Projected non-GAAP net income per share for 2022 lower than 2021 levels.

WASHINGTON--(BUSINESS WIRE)-- CoStar Group, Inc. (NASDAQ: CSGP), a leading provider of online real estate marketplaces, information and analytics in the commercial and residential property markets, announced today that revenue for the year ended December 31, 2021, was $1.94 billion, an increase of 17% over revenue of $1.66 billion for the full year of 2020. Revenue for the fourth quarter of 2021, was $507 million, an increase of 14% over revenue of $444 million for the fourth quarter of 2020.

Net income for the year ended December 31, 2021, was $293 million, an increase of 29% compared to net income of $227 million for the full year of 2020. Net income for the fourth quarter of 2021 was $93 million, or $0.24 per diluted share, an increase of 160% compared to net income of $36 million for the fourth quarter of 2020. EBITDA for the full year of 2021 was $565 million, an increase of 39% compared to EBITDA of $406 million for the full year of 2020.

“2021 was another very strong year for CoStar Group in terms of both revenue and sales growth,” said Andrew C. Florance, Founder and Chief Executive Officer of CoStar Group. “Our fourth quarter 2021 revenue run rate is now over $2 billion and our sales production has never been stronger. Company-wide net sales bookings for 2021 increased 18% year-over-year to $217 million, while net sales bookings in the fourth quarter of 2021 reached an all-time high of $67 million.”

“I’m particularly pleased with the revenue growth acceleration in CoStar,” stated Florance, “which began the year with 4% year-over-year revenue growth in the first quarter and ended the year with 13% year-over-year revenue growth in the fourth quarter. Net sales bookings for CoStar in the fourth quarter were virtually in-line with the record level of net sales bookings CoStar delivered in the third quarter of 2021. Even more encouraging, net sales bookings for Apartments.com increased sharply in the fourth quarter of 2021, indicating that the slowdown in revenue growth and sales bookings that we experienced earlier in the year is potentially behind us.”

“2021 was our first full year in the residential property space,” continued Florance, “and we are off to a strong start with revenue of $75 million. Revenue from our Homesnap products grew over 50% for the full year 2021 on a year-over-year pro forma basis. With an addressable market almost three times the size of our existing business, we believe that the residential property opportunity has the potential to add billions in revenue to CoStar Group over the medium to long term. In order to take advantage of this significant growth opportunity, we plan to increase the level of investment in residential products, content, sales and marketing in 2022.”

Year 2020-2021 Quarterly Results - Unaudited
(in millions, except per share data)
	2020					2021
	Q1	Q2	Q3	Q4		Q1	Q2	Q3	Q4
Revenues	$392	$397	$426	$444		$458	$480	$499	$507
Net income	73	60	58	36		74	61	64	93
Net income per share - diluted(1)	0.20	0.16	0.15	0.09		0.19	0.16	0.16	0.24
Weighted average outstanding shares - diluted(1)	368	377	394	394		394	394	394	395
EBITDA	100	109	108	88		136	133	123	173
Adjusted EBITDA	124	129	134	167		160	150	144	193
Non-GAAP net income	90	88	89	112		108	103	99	138
Non-GAAP net income per share - diluted(1)	0.24	0.23	0.23	0.29		0.27	0.26	0.25	0.35
__________________________
(1) Prior period amounts have been retroactively adjusted to reflect the ten-for-one stock split effected in the form of a stock dividend in June 2021.

As of December 31, 2021, the Company had approximately $3.8 billion in cash, cash equivalents and restricted cash and outstanding debt of approximately $1.0 billion.

2022 Outlook

The Company expects revenue in the range of $2.145 billion to $2.165 billion for the full year of 2022, representing growth of approximately 11% year-over-year at the midpoint of the range. We expect revenue for the first quarter of 2022 in the range of $510 million to $515 million, representing revenue growth of approximately 12% year-over-year at the midpoint of the range.

Full year 2022 revenue estimates include approximately $70 million of revenue from our Residential products, representing growth of approximately 15% year-over-year after adjusting for certain legacy Homes.com product revenues that were discontinued in 2021. The Company is planning to increase the level of investment in Residential to a range of approximately $300 to $320 million for the full year 2022, representing an increase in the range of $200 million to $220 million.

The Company expects adjusted EBITDA in a range of $565 million to $605 million for the full year of 2022, a decrease of $62 million, or 10%, at the midpoint of the range compared to 2021. For the first quarter of 2022, the Company expects adjusted EBITDA in a range of $155 million to $160 million. Excluding the Residential product revenue and investments, adjusted EBITDA is expected to be in a range of $815 million to $835 million for the full year of 2022.

“I am very pleased with the strong financial performance in 2021, which we expect to continue in 2022” said Scott T. Wheeler, Chief Financial Officer of CoStar Group. “Notwithstanding our Residential growth investments, our commercial property information and marketplace businesses are expected to deliver profit margins of approximately 40% in 2022, which would achieve our long-term goal of 40% adjusted EBITDA margins by 2023 one full year ahead of schedule.”

We expect full year 2022 non-GAAP net income per diluted share in a range of $0.95 to $1.02 based on 395 million shares. For the first quarter of 2022, we expect non-GAAP net income per diluted share in a range of $0.27 to $0.28 based on 394 million shares. These ranges include an estimated non-GAAP tax rate of 25% for the full year and the first quarter of 2022.

The preceding forward-looking statements reflect CoStar Group’s expectations as of February 22, 2022, including forward-looking non-GAAP financial measures on a consolidated basis, based on current estimates, expectations, observations, and trends. Given the risk factors, rapidly evolving economic environment, and uncertainties and assumptions discussed in this release and in our quarterly reports on Form 10-Q and annual reports on Form 10-K, including uncertainties as a result of the COVID-19 pandemic and responses to it by, and the impact on, global economies and the real estate industry, actual results may differ materially. Other than in publicly available statements, the Company does not intend to update its forward-looking statements until its next quarterly results announcement.

Reconciliation of EBITDA, adjusted EBITDA, non-GAAP net income and non-GAAP net income per diluted share to their GAAP basis results are shown in detail below, along with definitions for those terms. A reconciliation of forward-looking non-GAAP guidance to the most directly comparable GAAP measure, net income, can be found within the tables included in this release.

Quarterly historical revenue under the new disaggregated revenue categories announced on October 26, 2021, can be found in the tables below.

Non-GAAP Financial Measures

For information regarding the purpose for which management uses the non-GAAP financial measures disclosed in this release and why management believes they provide useful information to investors regarding the Company’s financial condition and results of operations, please refer to the Company’s latest periodic report.

EBITDA is a non-GAAP financial measure that represents GAAP net income attributable to CoStar Group before interest (expense) income and other (expense) income, loss on debt extinguishment, income taxes, depreciation and amortization.

Adjusted EBITDA is a non-GAAP financial measure that represents EBITDA before stock-based compensation expense, acquisition- and integration-related costs, restructuring costs, and settlements and impairments incurred outside the Company’s normal course of business. Adjusted EBITDA margin represents adjusted EBITDA divided by revenues for the period.

Non-GAAP net income is a non-GAAP financial measure determined by adjusting GAAP net income attributable to CoStar Group for stock-based compensation expense, acquisition- and integration-related costs, restructuring costs, settlement and impairment costs incurred outside the Company's normal course of business and loss on debt extinguishment, as well as amortization of acquired intangible assets and other related costs, and then subtracting an assumed provision for income taxes. In 2021, the Company is assuming a 25% tax rate in order to approximate our statutory corporate tax rate excluding the impact of discrete items.

Non-GAAP net income per diluted share is a non-GAAP financial measure that represents non-GAAP net income divided by the number of diluted shares outstanding for the period used in the calculation of GAAP net income per diluted share. For periods with GAAP net losses and non-GAAP net income, the weighted average outstanding shares used to calculate non-GAAP net income per share includes potentially dilutive securities that were excluded from the calculation of GAAP net income per share as the effect was anti-dilutive.

Earnings Conference Call
Management will conduct a conference call to discuss the fourth quarter and full year 2021 results and the Company’s outlook at 5:00 PM EST on Tuesday, February 22, 2022. A live audio webcast of the conference will be available in listen-only mode through the Investors section of the CoStar Group website: https://investors.costargroup.com. A replay of the webcast audio will also be available in the Investors section of our website for a period of time following the call.

CoStar Group, Inc.
Condensed Consolidated Statements of Operations - Unaudited
(in thousands, except per share data)
		Three Months Ended December 31,				Year Ended December 31,
		2021		2020		2021		2020
Revenues		$ 506,786		$ 444,393		$ 1,944,135		$ 1,659,019
Cost of revenues		86,330		78,154		357,241		308,968
Gross profit		420,456		366,239		1,586,894		1,350,051
Operating expenses:
Selling and marketing (excluding customer base amortization)		138,653		133,576		622,007		535,778
Software development		52,522		41,573		201,022		162,916
General and administrative		69,964		118,100		256,711		299,698
Customer base amortization		18,932		17,780		74,817		62,457
		280,071		311,029		1,154,557		1,060,849
Income from operations		140,385		55,210		432,337		289,202
Interest expense, net		(7,923)		(7,913)		(31,621)		(17,395)
Other income (expense)		909		(856)		3,252		(827)
Income before income taxes		133,371		46,441		403,968		270,980
Income tax expense		40,471		10,652		111,404		43,852
Net income		$ 92,900		$ 35,789		$ 292,564		$ 227,128
Net income per share - basic(1)		$ 0.24		$ 0.09		$ 0.75		$ 0.60
Net income per share - diluted(1)		$ 0.24		$ 0.09		$ 0.74		$ 0.59
Weighted-average outstanding shares - basic(1)		392,538		391,372		392,210		380,726
Weighted-average outstanding shares - diluted(1)		394,532		393,951		394,160		383,266
__________________________
(1) Prior period amounts have been retroactively adjusted to reflect the ten-for-one stock split effected in the form of a stock dividend in June 2021.

CoStar Group, Inc.
Reconciliation of Non-GAAP Financial Measures - Unaudited
(in thousands, except per share data)
Reconciliation of Net Income to Non-GAAP Net Income
		Three Months Ended December 31,								Year Ended December 31,
			2021				2020				2021				2020
Net income		$	92,900			$	35,789			$	292,564			$	227,128
Income tax expense			40,471				10,652				111,404				43,852
Income before income taxes			133,371				46,441				403,968				270,980
Amortization of acquired intangible assets			26,176				24,784				103,626				88,132
Stock-based compensation expense			16,721				12,667				63,709				54,104
Acquisition and integration related costs			3,243				65,892				18,718				92,523
Restructuring and related costs			—				—				—				413
Other expense			4,112				—				6,903				113
Non-GAAP income before income taxes			183,623				149,784				596,924				506,265
Assumed rate for income tax expense(1)			25	%			25	%			25	%			25	%
Assumed provision for income tax expense			(45,906	)			(37,446	)			(149,231	)			(126,566	)
Non-GAAP net income		$	137,717			$	112,338			$	447,693			$	379,699
Net income per share - diluted(2)		$	0.24			$	0.09			$	0.74			$	0.59
Non-GAAP net income per share - diluted(2)		$	0.35			$	0.29			$	1.14			$	0.99
Weighted average outstanding shares - basic(2)			392,538				391,372				392,210				380,726
Weighted average outstanding shares - diluted(2)			394,532				393,951				394,160				383,266
__________________________
(1) The assumed 25% tax rate approximates our statutory federal and state corporate tax rate.
(2) Prior period amounts have been retroactively adjusted to reflect the ten-for-one stock split effected in the form of a stock dividend in June 2021.
Reconciliation of Net Income to EBITDA and Adjusted EBITDA
		Three Months Ended December 31,								Year Ended December 31,
			2021				2020				2021				2020
Net income		$	92,900			$	35,789			$	292,564			$	227,128
Amortization of acquired intangible assets in cost of revenues			7,244				7,004				28,809				25,675
Amortization of acquired intangible assets in operating expenses			18,932				17,780				74,817				62,457
Depreciation and other amortization			6,880				8,249				29,018				28,812
Interest expense			7,923				7,913				31,621				17,395
Other (income) expense			(909	)			856				(3,252	)			827
Income tax expense			40,471				10,652				111,404				43,852
EBITDA		$	173,441			$	88,243			$	564,981			$	406,146
Stock-based compensation expense			16,721				12,667				63,709				54,104
Acquisition and integration related costs			3,243				65,892				18,718				92,523
Restructuring and related costs			—				—				—				413
Adjusted EBITDA		$	193,405			$	166,802			$	647,408			$	553,186

CoStar Group, Inc.
Condensed Consolidated Balance Sheets - Unaudited
(in thousands)
		December 31, 2021				December 31, 2020
ASSETS
Current assets:
Cash, cash equivalents and restricted cash		$	3,827,126			$	3,755,912
Accounts receivable			138,191				119,059
Less: Allowance for credit losses			(13,374	)			(15,110	)
Accounts receivable, net			124,817				103,949
Prepaid expenses and other current assets			36,182				28,651
Total current assets			3,988,125				3,888,512
Deferred income taxes, net			5,034				4,983
Property and equipment, net			271,431				126,325
Lease right-of-use assets			100,680				108,740
Goodwill			2,321,015				2,235,999
Intangible assets, net			435,662				426,745
Deferred commission costs, net			101,879				93,274
Deposits and other assets			21,762				15,856
Income tax receivable			11,283				14,986
Total assets		$	7,256,871			$	6,915,420
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable		$	22,244			$	15,732
Accrued wages and commissions			81,794				80,998
Accrued expenses			81,676				110,305
Income taxes payable			31,236				16,316
Lease liabilities			26,268				32,648
Deferred revenue			95,471				74,851
Total current liabilities			338,689				330,850
Long-term debt, net			987,944				986,715
Deferred income taxes, net			98,656				72,991
Income taxes payable			12,496				25,282
Lease and other long-term liabilities			107,414				124,223
Total liabilities		$	1,545,199			$	1,540,061
Total stockholders’ equity			5,711,672				5,375,359
Total liabilities and stockholders’ equity		$	7,256,871			$	6,915,420

CoStar Group, Inc.
Condensed Consolidated Statements of Cash Flows - Unaudited
(in thousands)
	Year Ended December 31,
		2021				2020
Operating activities:
Net income	$	292,564			$	227,128
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		139,558				116,944
Amortization of deferred commissions costs		63,391				60,516
Amortization of Senior Notes discount and issuance costs		2,327				1,658
Non-cash lease expense		28,485				26,326
Stock-based compensation expense		63,709				53,450
Deferred income taxes, net		24,165				(11,530	)
Credit loss expense		10,928				25,212
Other operating activities, net		(654	)			288
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable		(29,630	)			(36,118	)
Prepaid expenses and other current assets		(14,873	)			1,936
Deferred commissions		(72,038	)			(64,355	)
Accounts payable and other liabilities		(30,051	)			100,846
Lease liabilities		(30,904	)			(30,497	)
Income taxes payable		5,860				10,352
Deferred revenue		17,396				2,188
Other assets		(502	)			1,762
Net cash provided by operating activities		469,731				486,106
Investing activities:
Proceeds from sale and settlement of investments		—				10,259
Proceeds from sale of property and equipment and other assets		612				—
Purchase of Richmond assets and other intangibles		(123,764	)			—
Purchases of property and equipment and other assets		(65,220	)			(48,347	)
Cash paid for acquisitions, net of cash acquired		(192,971	)			(426,075	)
Net cash used in investing activities		(381,343	)			(464,163	)
Financing activities:
Proceeds from long-term debt		—				1,744,210
Payments of debt issuance costs		—				(16,647	)
Payments of long-term debt		—				(745,000	)
Repurchase of restricted stock to satisfy tax withholding obligations		(33,314	)			(38,867	)
Proceeds from equity offering, net of transaction costs		—				1,689,971
Proceeds from exercise of stock options and employee stock purchase plan		18,046				30,280
Other financing activities		(411	)			(1,650	)
Net cash (used in) provided by financing activities		(15,679	)			2,662,297
Effect of foreign currency exchange rates on cash and cash equivalents		(1,495	)			941
Net increase in cash, cash equivalents and restricted cash		71,214				2,685,181
Cash, cash equivalents and restricted cash at the beginning of period		3,755,912				1,070,731
Cash, cash equivalents and restricted cash at the end of period	$	3,827,126			$	3,755,912

CoStar Group, Inc.
Disaggregated Revenues - Unaudited
(in thousands)
	Three Months Ended December 31,
	2021									2020
	North America			International			Total			North America			International			Total
CoStar	$	181,478		$	8,915		$	190,393		$	160,842		$	7,896		$	168,738
Information Services		28,764			7,112			35,876			27,048			6,930			33,978
Multifamily		170,051			—			170,051			160,370			—			160,370
LoopNet(1)		53,046			1,613			54,659			48,023			178			48,201
Residential(1)		20,644			—			20,644			—			—			—
Other Marketplaces(1)		35,163			—			35,163			33,106			—			33,106
Total revenues	$	489,146		$	17,640		$	506,786		$	429,389		$	15,004		$	444,393
__________________________
(1) As of September 30, 2021, Commercial Property and Land revenue has been further disaggregated into LoopNet, Residential and Other Marketplaces. Prior period amounts have been adjusted to reflect this presentation.
	Year Ended December 31,
	2021									2020
	North America			International			Total			North America			International			Total
CoStar	$	686,948		$	35,873		$	722,821		$	634,205		$	30,530		$	664,735
Information Services		113,723			27,932			141,655			104,117			25,953			130,070
Multifamily		678,680			—			678,680			598,555			—			598,555
LoopNet(1)		204,816			2,695			207,511			179,371			434			179,805
Residential(1)		74,583			—			74,583			—			—			—
Other Marketplaces(1)		118,885			—			118,885			85,854			—			85,854
Total revenues	$	1,877,635		$	66,500		$	1,944,135		$	1,602,102		$	56,917		$	1,659,019
__________________________
(1) As of September 30, 2021, Commercial Property and Land revenue has been further disaggregated into LoopNet, Residential and Other Marketplaces. Prior period amounts have been adjusted to reflect this presentation.

CoStar Group, Inc.
Disaggregated Revenues - Unaudited
(in thousands)
	2020												2021
	Q1			Q2			Q3			Q4			Q1			Q2			Q3			Q4
CoStar	$	164,956		$	165,053		$	165,988		$	168,738		$	172,184		$	176,979		$	183,265		$	190,393
Information Services		32,382			30,536			33,174			33,978			34,696			35,157			35,926			35,876
Multifamily		137,460			145,541			155,184			160,370			166,147			171,357			171,125			170,051
LoopNet(1)		43,200			43,320			45,084			48,201			49,230			51,095			52,527			54,659
Residential(1)		—			—			—			—			11,105			18,087			24,747			20,644
Other Marketplaces(1)		13,849			12,709			26,190			33,106			24,335			27,658			31,729			35,163
Total revenues	$	391,847		$	397,159		$	425,620		$	444,393		$	457,697		$	480,333		$	499,319		$	506,786
__________________________
As of September 30, 2021, Commercial Property and Land revenue has been further disaggregated into LoopNet, Residential and Other Marketplaces. Prior period amounts have been adjusted to reflect this presentation.

CoStar Group, Inc.
Results of Segments - Unaudited
(in thousands)
	Three Months Ended December 31,						Year Ended December 31,
		2021			2020			2021			2020
EBITDA
North America	$	171,268		$	88,241		$	557,125		$	410,852
International		2,173			2			7,856			(4,706	)
Total EBITDA	$	173,441		$	88,243		$	564,981		$	406,146

CoStar Group, Inc.
Reconciliation of Non-GAAP Financial Measures with 2020-2021 Quarterly Results - Unaudited
(in millions, except per share data)
Reconciliation of Net Income to Non-GAAP Net Income
		2020													2021
		Q1			Q2			Q3			Q4				Q1			Q2			Q3			Q4
Net income		$	72.8		$	60.4		$	58.2		$	35.8			$	74.2		$	61.1		$	64.3		$	92.9
Income tax expense			5.6			16.9			10.7			10.7				19.1			32.8			19.0			40.5
Income before income taxes			78.4			77.3			68.9			46.4				93.3			93.9			83.3			133.4
Amortization of acquired intangible assets			17.5			21.0			24.9			24.8				25.8			25.3			26.3			26.2
Stock-based compensation expense			15.2			9.5			16.7			12.7				15.5			15.1			16.3			16.7
Acquisition and integration related costs			8.7			10.0			7.9			65.9				8.5			2.0			5.0			3.2
Restructuring and related costs			—			—			0.4			—				—			—			—			—
Other expense			—			—			0.1			—				1.1			0.8			0.9			4.1
Non-GAAP income before income taxes(1)			119.8			117.8			118.9			149.8				144.2			137.1			131.8			183.6
Assumed rate for income tax expense (2)			25	%		25	%		25	%		25	%			25	%		25	%		25	%		25	%
Assumed provision for income tax expense			(30.0	)		(29.5	)		(29.7	)		(37.5	)			(36.0	)		(34.3	)		(33.0	)		(45.9	)
Non-GAAP net income(1)		$	89.8		$	88.3		$	89.2		$	112.3			$	108.2		$	102.8		$	98.8		$	137.7
Non-GAAP net income per share - diluted(3)		$	0.24		$	0.23		$	0.23		$	0.29			$	0.27		$	0.26		$	0.25		$	0.35
Weighted average outstanding shares - basic(3)			364.7			375.2			391.6			391.4				391.6			392.3			392.4			392.5
Weighted average outstanding shares - diluted(3)			367.8			377.3			394.0			394.0				393.7			394.1			394.3			394.5
__________________________
(1) Totals may not foot due to rounding.
(2) The assumed 25% tax rate approximates our statutory federal and state corporate tax rate.
(3) Prior period amounts have been retroactively adjusted to reflect the ten-for-one stock split effected in the form of a stock dividend in June 2021.
Reconciliation of Net Income to EBITDA and Adjusted EBITDA
		2020													2021
		Q1			Q2			Q3			Q4				Q1			Q2			Q3			Q4
Net income		$	72.8		$	60.4		$	58.2		$	35.8			$	74.2		$	61.1		$	64.3		$	92.9
Amortization of acquired intangible assets			17.5			21.0			24.9			24.8				25.8			25.3			26.3			26.2
Depreciation and other amortization			6.8			7.0			6.8			8.2				8.5			7.0			6.6			6.9
Interest (income) expense			(1.7	)		3.6			7.5			7.9				7.9			7.9			7.9			7.9
Other (income) expense			(0.8	)		0.4			0.3			0.9				0.1			(0.8	)		(1.5	)		(0.9	)
Income tax expense			5.6			16.9			10.7			10.7				19.1			32.8			19.0			40.5
EBITDA(1)		$	100.2		$	109.3		$	108.4		$	88.3			$	135.6		$	133.3		$	122.6		$	173.4
Stock-based compensation expense			15.1			9.5			16.7			12.7				15.5			15.1			16.3			16.7
Acquisition and integration related costs			8.7			10.0			7.9			65.9				8.5			2.0			5.0			3.2
Restructuring and related costs			—			—			0.4			—				—			—			—			—
Adjusted EBITDA(1)		$	124.0		$	128.8		$	133.4		$	166.9			$	159.6		$	150.4		$	143.9		$	193.4
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(1) Totals may not foot due to rounding.

CoStar Group, Inc.
Reconciliation of Forward-Looking Guidance - Unaudited
(in thousands, except per share data)
Reconciliation of Forward-Looking Guidance, Net Income to Non-GAAP Net Income
	Guidance Range								Guidance Range
	For the Three Months								For the Year Ending
	Ending March 31, 2022								December 31, 2022
	Low				High				Low				High
Net income	$	73,000			$	77,000			$	249,000			$	279,000
Income tax expense		23,000				24,000				82,000				92,000
Income before income taxes		96,000				101,000				331,000				371,000
Amortization of acquired intangible assets		23,000				23,000				87,000				87,000
Stock-based compensation expense		18,000				18,000				78,000				78,000
Acquisition and integration related costs		2,000				2,000				2,000				2,000
Other expense		1,000				1,000				1,000				1,000
Non-GAAP income before income taxes		140,000				145,000				499,000				539,000
Assumed rate for income tax expense(1)		25	%			25	%			25	%			25	%
Assumed provision for income tax expense		(35,000	)			(36,300	)			(124,800	)			(134,800	)
Non-GAAP net income	$	105,000			$	108,700			$	374,200			$	404,200
Net income per share - diluted(2)	$	0.19			$	0.20			$	0.63			$	0.71
Non-GAAP net income per share - diluted(2)	$	0.27			$	0.28			$	0.95			$	1.02
Weighted average outstanding shares - diluted(2)		394,400				394,400				394,700				394,700
__________________________
(1) The assumed 25% tax rate approximates our statutory federal and state corporate tax rate.
(2) Prior period amounts have been retroactively adjusted to reflect the ten-for-one stock split effected in the form of a stock dividend in June 2021.
Reconciliation of Forward-Looking Guidance, Net Income to Adjusted EBITDA
	Guidance Range								Guidance Range
	For the Three Months								For the Year Ending
	Ending March 31, 2022								December 31, 2022
	Low				High				Low				High
Net income	$	73,000			$	77,000			$	249,000			$	279,000
Amortization of acquired intangible assets		23,000				23,000				87,000				87,000
Depreciation and other amortization		8,000				8,000				36,000				36,000
Interest expense		8,000				8,000				32,000				32,000
Other (income)		—				—				(1,000	)			(1,000	)
Income tax expense		23,000				24,000				82,000				92,000
Stock-based compensation expense		18,000				18,000				78,000				78,000
Acquisition and integration related costs		2,000				2,000				2,000				2,000
Adjusted EBITDA	$	155,000			$	160,000			$	565,000			$	605,000

About CoStar Group, Inc.
CoStar Group, Inc. (NASDAQ: CSGP) is a leading provider of online real estate marketplaces, information and analytics. Founded in 1987, CoStar conducts expansive, ongoing research to produce and maintain the largest and most comprehensive database of commercial real estate information. Our suite of online services enables clients to analyze, interpret and gain unmatched insight on commercial property values, market conditions and current availabilities. STR provides premium data benchmarking, analytics and marketplace insights for the global hospitality industry. Ten-X provides a leading platform for conducting commercial real estate online auctions and negotiated bids. LoopNet is the most heavily trafficked commercial real estate marketplace online. Apartments.com, ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, Westside Rentals, AFTER55.com, CorporateHousing.com, ForRentUniversity.com and Apartamentos.com form the premier online apartment resource for renters seeking great apartment homes and provide property managers and owners a proven platform for marketing their properties. Homesnap is an industry-leading online and mobile software platform that provides user-friendly applications to optimize residential real estate agent workflow and reinforce the agent-client relationship. Homes.com offers real estate professionals advertising and marketing services for residential properties. Realla is the UK’s most comprehensive commercial property digital marketplace. BureauxLocaux is one of the largest specialized property portals for buying and leasing commercial real estate in France. CoStar Group’s websites attract tens of millions of unique monthly visitors. Headquartered in Washington, DC, CoStar Group maintains offices throughout the U.S., Europe, Canada and Asia. From time to time we plan to utilize our corporate website, www.costargroup.com, as a channel of distribution for material company information.

This news release and the Company’s earnings conference call contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about CoStar Group's plans, objectives, expectations, beliefs and intentions and other statements including words such as “hope,” “anticipate,” “may,” “believe,” “expect,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential” or the negative of these terms or other comparable terminology. Such statements are based upon the current beliefs and expectations of management of CoStar Group and are subject to many risks and uncertainties. Actual results may differ materially from the results anticipated in the forward-looking statements and the assumptions and estimates used as a basis for the forward-looking statements. The following factors, among others, could cause or contribute to such differences: the risk that the trends stated or implied by this release or in the earnings conference call cannot or will not be sustained at the current pace or may increase or decrease, including trends and expectations related to revenue, revenue growth, net income, non-GAAP net income, EBITDA, adjusted EBITDA, adjusted EBITDA margin, sales, net sales bookings, site traffic and visitors, leads, and renewal rates; the risk that the Company is unable to sustain current Company-wide, CoStar or Apartments net sales bookings and that the slowdown in revenue growth and sales bookings that Apartments.com experienced earlier in 2021 is not yet fully resolved; the risk that the Company is unable to realize the full potential of the residential property opportunity as stated in this press release; the risk that the level of investment in residential products, content, sales and marketing is not as expected and set forth in this press release or changes; the risk that revenues for the first quarter and full year 2022 will not be as stated in this press release; the risk that revenues from Residential products for the full year 2022 will not be as stated in this press release; the risk that net income for the first quarter and full year 2022 will not be as stated in this press release; the risk that adjusted EBITDA for the first quarter and full year 2022 will not be as stated in this press release; the risk that adjusted EBITDA for the full year 2022, excluding the Residential product revenue and investments, will not be as stated in this press release; the risk that profit margins for commercial property information and marketplace businesses in 2022, excluding Residential growth investments, will not be as stated in this press release; the risk that non-GAAP net income and non-GAAP net income per diluted share for the first quarter and full year 2022 will not be as stated in this press release; the risk that the tax rate estimates stated in this press release may change; uncertainty surrounding the impact of the COVID-19 pandemic, including volatility in the international and U.S. economy and the real estate industry, employee attrition, absenteeism or decreased productivity, quarantines or other travel or health-related restrictions; the length and severity of the COVID-19 pandemic; the pace of recovery following the COVID-19 pandemic; and government and private actions taken to control the spread of COVID-19. More information about potential factors that could cause results to differ materially from those anticipated in the forward-looking statements include, but are not limited to, those stated in CoStar Group’s filings from time to time with the Securities and Exchange Commission, including in CoStar Group’s Annual Report on Form 10-K for the year ended December 31, 2020 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2021, June 30, 2021 and September 30, 2021, each of which is filed with the SEC, including in the “Risk Factors” section of those filings, as well as CoStar Group’s other filings with the SEC (including Current Reports on Form 8-K) available at the SEC’s website (www.sec.gov). All forward-looking statements are based on information available to CoStar Group on the date hereof, and CoStar Group assumes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220222006198/en/

Investor Relations:

Bill Warmington

Vice President

CoStar Group Investor Relations

(202) 346-5661

wwarmington@costar.com

News Media:

Matthew Blocher

Vice President

CoStar Group Corporate Marketing & Communications

(202) 346-6775

mblocher@costargroup.com

Source: CoStar Group, Inc.

FAQ

What is CoStar Group's revenue for 2021?

CoStar Group's revenue for 2021 was $1.94 billion, a 17% increase over 2020.

How much did CoStar Group earn in net income for Q4 2021?

CoStar Group earned $93 million in net income for the fourth quarter of 2021.

What revenue growth does CoStar Group expect for 2022?

CoStar Group expects revenue in the range of $2.145 billion to $2.165 billion for 2022, representing approximately 11% year-over-year growth.

What were CoStar Group's net sales bookings in Q4 2021?

CoStar Group achieved record net sales bookings of $67 million in the fourth quarter of 2021.

What are the expected adjusted EBITDA figures for CoStar Group in 2022?

CoStar Group expects adjusted EBITDA in the range of $565 million to $605 million for the full year of 2022.