Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
CoStar Group (CSGP) returned to profitability in Q1 FY2026 with revenue surging 22.5% YoY to $897M and operating income turning positive at $3M, while the company deployed $505M in share buybacks, sharply reducing its cash balance.
Revenue
$897M
+22.54% YoY
EPS (Diluted)
$0.01
+125.00% YoY
Gross Margin
78.1%
-0.9 pts YoY
Operating Income
$3M
+106.98% YoY
Source: SEC XBRL
Costar Group (CSGP) reported Q1 FY2026 revenue of $897M, up 22.5% year over year. Operating margin was 0.3%, against -5.9% a year earlier. Operating cash flow was $152M, up 186.8% year over year. CSGP's fiscal Q1 FY2026 corresponds to calendar Q1 2026.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 0.32 | 0.30 | Beat +7.0% |
| Mar 2026This filing | 0.23 | 0.19 | Beat +22.5% |
| Dec 2025 | 0.31 | 0.28 | Beat +10.9% |
| Sep 2025 | 0.23 | 0.18 | Beat +25.5% |
Adjusted (non-GAAP) EPS of $0.23 versus the $0.19 analyst consensus — a +22.5% beat for Mar 2026. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was $0.01.
Compiled by AI from this SEC filing
Revenue grew 22.5% YoY from $732M to $897M in Q1 FY2026, reflecting continued momentum in CoStar's commercial real estate information and marketplace platforms. This double-digit growth rate demonstrates sustained demand for the company's subscription-based data and analytics services.
Source: 10-Q Income Statement, Q1 FY2026
Operating income turned positive at $3M compared to a loss of -$43M in the prior-year period, representing a $46M improvement. This marks a significant inflection point as the company's revenue scale begins to cover its heavy investment in sales, marketing, and product development.
Source: 10-Q Income Statement, Q1 FY2026
Gross margin declined modestly from 79.1% to 78.1% YoY, as cost of revenue grew faster (28.1%) than revenue (22.5%). This slight compression likely reflects increased infrastructure, data, and content costs associated with scaling the business.
Source: 10-Q Income Statement & Key Ratios, Q1 FY2026
Operating cash flow surged 186.8% YoY to $152M from $53M, indicating that the business is generating meaningfully more cash from operations as profitability improves and working capital dynamics normalize. This is a strong signal of underlying business quality.
Source: 10-Q Cash Flow Statement, Q1 FY2026
The company repurchased $505M in shares during Q1 FY2026, up from just $19M in the prior-year period — a 2,558% increase. This drove financing cash outflows of -$514M and reduced cash & equivalents by 67% YoY from $3.68B to $1.22B, signaling management's confidence in the stock's value.
Source: 10-Q Cash Flow Statement & Balance Sheet, Q1 FY2026
Compiled by AI from this SEC filing · 2 high, 2 medium, 1 low
Cash & equivalents fell sharply from $3.68B to $1.22B YoY, a 67% decline, primarily driven by $505M in share repurchases in a single quarter. While the current ratio remains healthy at 2.2x, continued aggressive buybacks at this pace could constrain financial flexibility for acquisitions or investments. Management must balance capital return with strategic investment needs.
Source: 10-Q Balance Sheet & Cash Flow Statement, Q1 FY2026
Despite $897M in quarterly revenue, operating and net margins stand at just 0.33%, meaning the business has very little buffer against cost increases or revenue shortfalls. The company is operating near breakeven, and any acceleration in operating expenses could quickly push results back into loss territory. Sustained profitability at scale remains unproven.
Source: 10-Q Income Statement & Key Ratios, Q1 FY2026
Cost of revenue grew 28.1% YoY versus revenue growth of 22.5%, creating a modest but notable margin headwind. If this trend continues, gross margin — currently at 78.1% — could erode further, pressuring the path to meaningful profitability. This may reflect higher content, data, or technology delivery costs tied to platform expansion.
Source: 10-Q Income Statement, Q1 FY2026
Total assets declined 2.5% YoY to $10.16B and stockholders' equity fell 7.5% to $7.91B, partly reflecting the large share buyback program reducing retained equity. While the balance sheet remains solid with a debt-to-equity ratio of 0.28x, continued equity reduction without commensurate earnings growth could weaken the balance sheet over time.
Source: 10-Q Balance Sheet, Q1 FY2026
CoStar's core business is deeply tied to commercial real estate activity, which remains under pressure from elevated interest rates, remote work trends, and reduced transaction volumes. A prolonged downturn in CRE could slow subscription renewals and new customer acquisition. The company's ability to sustain 22%+ revenue growth depends on continued market engagement from CRE professionals.
Source: 10-Q Income Statement (revenue trends), Q1 FY2026
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $M | 897.00 $M | 732.00 $M | +22.54% |
Cost of Revenue $M | 196.00 $M | 153.00 $M | +28.10% |
Gross Profit $M | 701.00 $M | 579.00 $M | +21.07% |
Operating Income $M | 3.00 $M | -43.00 $M | +106.98% |
Net Income $M | 3.00 $M | -15.00 $M | +120.00% |
EPS (Basic) $ | 0.01 $ | -0.04 $ | +125.00% |
EPS (Diluted) $ | 0.01 $ | -0.04 $ | +125.00% |
Answers draw on this SEC filing and the data on this page
CoStar Group reported strong Q2 FY2026 financial results with revenue increasing 18.4% year-over-year to $925M and net income rising to $55M, driven by solid Residential segment expansion and the integration of strategic acquisitions.
CoStar Group (CSGP) delivered 18.7% revenue growth to $3.25B in FY2025, but swung to an operating loss of $72M and saw net income collapse 95% to $7M as aggressive investment spending and a major acquisition drove costs sharply higher.
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