Zillow Group Inc. (NASDAQ: ZG) saw its stock price decline by approximately 4% in after-hours trading following the release of its fourth-quarter earnings report. Although the real estate marketplace's revenue of $654 million surpassed analyst expectations, its earnings per share of $0.39 fell short of the anticipated $0.40. This slight miss triggered investor concern, leading to the stock's immediate negative reaction in the market.

Despite the earnings shortfall, Zillow's revenue for the quarter was close to the upper end of its projected range. For the full year of 2025, the company's revenue reached $2.6 billion, marking a 16% year-over-year increase. This performance significantly outpaced the broader residential real estate sector, which grew by only 3% during the same period according to industry data. The company attributed its strong results to considerable growth across various business segments.

Zillow's growth was driven by a surge in its Rentals segment, with revenue rising 45% year-over-year to $168 million. The For Sale segment also showed strength, increasing by 11% year-over-year to $475 million. Further bolstering the company's performance, Mortgages revenue jumped 39% to $57 million, fueled by a 67% increase in purchase loan origination volume. CEO Jeremy Wacksman highlighted the company's achievements in a statement.

During the fourth quarter, traffic to Zillow's platforms experienced an 8% year-over-year increase, reaching an average of 221 million monthly unique users. The total number of visits also rose, climbing by 2% to 2.1 billion. On a GAAP basis, the company reported net income of $3 million for the quarter, reflecting a 0% net income margin and a 990-basis-point improvement from the previous year. These figures suggest a mixed financial performance.