CoStar responded Wednesday by calling the allegations “extremely deceptive” and questioned D.E. Shaw’s motivations, noting the investor holds vital stakes in direct opponents.
“If D. E. Shaw is fearful about transparency, it ought to begin with itself,” the corporate said. “D.E. Shaw has by no means disclosed its financial publicity to CoStar Group, or even when it’s a internet lengthy investor.”
CoStar supplied additional element on why it believes D.E. Shaw’s marketing campaign could also be pushed by conflicts of curiosity — highlighting the hedge fund’s investments in CoStar opponents.
“Public filings recommend D. E. Shaw owns simply 0.22% of CoStar Group’s frequent inventory, however virtually 4x that worth in CoStar Group opponents who would straight profit from D. E. Shaw’s push for us to desert Houses.com and get rid of the quickest rising residential actual property platform within the business,” the corporate mentioned.
Debate background
The dispute stems from CoStar’s heavy funding in Houses.com and whether or not it’s creating or impeding long-term worth and shareholder wealth.
D.E. Shaw estimates CoStar may have spent greater than $3 billion on Houses.com by the top of 2026.
The agency additionally accused administration of stopping the disclosure of key working metrics — comparable to internet new bookings for Houses.com.
“Throughout the newest earnings name, when analysts particularly requested segment-level internet new bookings knowledge, administration declined to offer the knowledge,” D.E. Shaw’s letter mentioned. “Buyers took discover: these puzzling strikes contributed to a 9% decline within the Firm’s inventory value the next day — destroying almost $2 billion of shareholder worth.”
CoStar defended its reporting practices Tuesday — saying section disclosures had been realigned from geography-based to product-based segments to higher mirror operational construction.
“Our new section disclosure truly affords extra transparency by offering audited income, EBITDA, Adjusted EBITDA and margin disclosures for each the Residential and Industrial segments in our current 10-Okay, in addition to persevering with to offer disaggregated income disclosures,” the corporate said. “Buyers ought to anticipate related Houses.com disclosures on our earnings calls that CoStar Group has all the time offered to stockholders.”
CoStar This fall, full 12 months internet earnings drop
Throughout the referenced This fall earnings name, CoStar Group CEO Andy Florance highlighted growth throughout the Houses.com community.
The platform logged greater than 2.1 billion visits and averaged 100 million month-to-month distinctive guests in 2025, based on Comscore, whereas January natural visitors rose 134% 12 months over 12 months.
“We really feel we have now achieved a very good steadiness between SEM, website positioning and direct visitors,” Florance mentioned. “This enables us to optimize SEM for high quality visitors and leads, not simply pure amount.”
Florance added that engagement improved — with session period rising to about 4 minutes and 30 seconds and bounce charges falling from 63% in January 2025 to 41% in January 2026.
Lead quantity elevated 48% yearly in January, with leads for Houses.com member brokers up 187%.
Regardless of improved metrics for Houses.com, CoStar’s internet earnings fell from $60 million a 12 months in the past to $47 million for This fall 2025.
For the total 12 months, as income rose 19% yearly to $3.25 billion, internet earnings fell to $7 million from $139 million in 2024.
CoStar has argued that abandoning present Houses.com technique would inflict “irreparable harm” on its platform and buyers.
