Zillow says its ‘Housing Super App’ strategy is working

Zillow may be facing legal and Realtor Code of Ethics challenges from a variety of sources in and out of the housing industry, but executives feel strongly that the company’s “Housing Super App” strategy is paying off. 

“Our strong results and consistent execution demonstrate the durability of our strategy. Zillow is the operating system for modern real estate: AI-native, at the core of the transaction, empowering both consumers and professionals from end to end,” Zillow CEO Jeremy Wacksman and CFO and newly appointed COO Jeremy Hofmann wrote in a letter to shareholders regarding their firm’s second quarter 2026 financial results, published on Wednesday.

During Q2 2026, Zillow generated $772 million in revenue, up 18% year-over-year. The company’s for-sale segment generated $549 million in revenue, up 14% annually, while its residential segment was up 7% to $465 million, its mortgage revenue rose 75% to $84 million and its rentals segment recorded a 31% yearly increase in revenue to $209 million.

Despite these increases, the company reported a net loss of $4 million for the quarter, down from a net income of $2 million a year ago. However, for the six months ending June 30, 2026, Zillow has recorded $42 million in net income, compared to $10 million a year ago. 

Revenue growth across the board

Zillow attributed much of the growth of its rentals revenue to a 23% annual increase in the number of multifamily properties on its site, which came in at 79,000 properties at the end of the quarter. 

As for Zillow Home Loans, the firm reported $2.2 billion in loan origination volume for the quarter, up 95% compared to a year ago. The company said the double digit adoption growth of its mortgage product was due to its integration of pre-approval directly into users’ home search. Zillow noted that its mortgage arm is now a top-25 purchase lender in the country and that its average loan officer originates roughly twice the industry average of purchase loans per month.

Additionally, Zillow executives noted that Zillow Home Loans’ per mortgage unit economics were positive as of early August. In the future, Zillow said it expects Zillow Home Loans economics to generate profits similar to profits the company earns from Preferred agent partner referral fees.

Residential revenue growth

In looking at its for-sale and residential segments, executives said their firm has “built a platform where our interests align with the interests of buyers, sellers and agents.” According to Zillow’s data, the average buyer who ends up transacting with a Zillow Preferred agent spends roughly 15 hours using Zillow before they reach out to connect with an agent. This high level of buyer engagement and use, Zillow said, has enabled it to become more useful to homebuyers.

Additionally, Zillow noted that its AI search mode option has enabled it to learn even more about consumer wants and needs, noting that consumers “share more about their needs in AI mode than they ever entered into a typical residential search query — not just what they’re looking for in a home, but their timeline, financial picture, the need to sell their current home, whether they need a fenced backyard for their pets and other special circumstances that go into their decision.”

“Consumers who use AI mode spend more than three times as long on Zillow, view more than twice as many homes, run nearly three times as many searches — and contact an agent at nearly three times the rate of consumers who don’t use AI mode,” Hofmann and Wacksman wrote in their letter to shareholders.

The company said AI search mode is currently live for roughly 20% of signed-in users.

“We are actively expanding what AI mode can do — adding skills and evaluations that serve buyers, sellers, renters and homeowners,” Hofmann and Wacksman wrote. “The opportunity in front of us is to deepen our engagement with our already broad audience, across every stage, in ways that weren’t possible before.”

Zillow also noted that the Zillow Preferred agent referral fee model it had swapped to from its previous Preferred Agent program, which saw agents pay for leads up front, has led to a 23% annual increase in revenue from its lead generation business. 

The leaders also discussed the Zillow Pro program, highlighting how the platform can help listing agents through features such as “Likely to List, which uses predictive AI signals from the unique context across [the Zillow] platform — including from AI mode — to flag contacts in an agent’s Follow Up Boss database whose homes show pre-listing activity, giving agents a reason to reconnect with past contacts who may be ready to sell before they’ve raised their hand elsewhere.” 

Zillow executives also touched on the company’s Preview product which it launched this spring. The firm said it now has over 100 brokerages signed on to Zillow Preview, noting that later this summer all Preview listings will be syndicated to Realtor.com. 

“As MLSs give sellers, agents and brokers more options and more flexibility in how long they can pre-market a listing, we welcome those changes because they boost the value proposition of Zillow Preview,” the executives wrote. 

The future of Zillow

The executives also addressed the round of layoffs Zillow conducted on Tuesday, which saw the firm eliminate over 500 roles. 

“We made this decision to ensure we can move faster and operate more efficiently with a more sustainable cost structure. We’re grateful to every person who is leaving for their contributions through the years,” Hofmann and Wacksman wrote. 

Looking ahead, Wacksman and Hofmann wrote that despite all of the “noise” this year, they continue to see plenty of positives in their business. 

“Zillow consistently performs well because we support the needs of both sides of the marketplace: We’ve rapidly built the modern real estate operating system professionals rely on every day to run their businesses,” they wrote. “And consumers trust and return to Zillow throughout a months-long journey, no matter where that journey began. Our direct brand and audience engagement put us in a position of strength as we drive forward and expand our business.”