202102 Nov

Zillow says its closing home-buying business and cutting 25% of workforce; earnings miss estimates

Summary

Zillow, the digital real estate company, said on Tuesday that its exiting its business that buys and flips homes and eliminating 25% of its workforce. "Weve determined the unpredictability in forecasting home prices far exceeds what we anticipated," Zillow CEO Rich Barton said in a press release as part of the companys third-quarter earnings report. Here are the key numbers from earnings: • Earnings per share: loss of 95 cents adjusted vs. profit of 16 cents per share expected in a Refinitiv survey of analysts Revenue in Zillows Offers business, which competes with Opendoor, climbed to $1.17 billion in the quarter from $185.9 million a year earlier, which was in the middle of the pandemic so transactions had largely dried up. The product allowed homeowners to sell their home to Zillow for cash, eliminating a lengthy bidding, sales and closing process while not having to worry about costly repairs before putting it on the market. However, the home-flipping market proved to be a drag for a company that had built its brand on listing homes across the country and helping buyers and sellers connect through a marketplace.

Source: Cnbc

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