Real Estate Sector

Zillow Group laid off over 500 employees on Tuesday, cutting 7% of its workforce in its largest round of layoffs this year. The company executed the cuts one day before reporting second-quarter earnings to rein in swelling operational expenses. Zillow expanded heavily into rental listings, added loan officers for Zillow Home Loans, and accrued heavy advertising and legal expenses over the past year. Those spending commitments pressed management to cut payroll to deliver on promises made to investors in May that spending would ease. The downsizing occurs alongside financial outperformance in its core business. In the first quarter, Zillow posted $708 million in revenue, an 18% year-over-year increase that far outpaced the 2% growth of the broader residential real estate market. Net income rose to $46 million from $8 million a year earlier. Zillow's stock has fallen over 47% this year despite those profits. Pressure is also compounding from a pending FTC antitrust trial later this month over Zillow's $100 million deal for exclusive rental listings on Redfin's platform. Chief Executive Officer Jeremy Wacksman previously told investors that Zillow was becoming an "AI-native" company, but Zillow declined to specify if artificial intelligence drove the cuts. The job cuts reflect broader consolidation across property technology: CoStar cut its Homes.com inside-sales team by nearly 40%, while Rocket cut 2% of its workforce after acquiring Redfin for $1.75 billion. Zillow goes to trial in the FTC antitrust suit later this month.

Zillow generated $772 million in revenue in the second quarter of 2026, up 18% year-over-year as its mortgage and rental businesses offset broader housing market headwinds, according to housingwire.com. Mortgage revenue jumped 75% to $84 million after the platform integrated home loan pre-approvals directly into its search engine, driving $2.2 billion in total loan originations. Rental revenue grew 31% to $209 million as multifamily property listings on the site rose 23% to 79,000. Under its primary monetization mechanism, Zillow swapped its traditional model of selling upfront buyer leads to real estate agents for a commission-sharing referral fee model through its Zillow Preferred program. That shift boosted lead generation revenue by 23%. Higher operating costs squeezed quarterly profitability, resulting in a $4 million net loss compared to a $2 million net income a year earlier. To protect margins, management eliminated more than 500 positions across the company.

Zillow Group eliminated more than 500 jobs, or roughly 7% of its workforce, directly before reorganizing its executive leadership, housingwire.com reports. The tech-enabled real estate platform expanded Chief Financial Officer Jeremy Hofmann’s duties to include Chief Operating Officer, binding financial strategy and daily operations under a single nine-year company veteran. Hofmann replaces Jun Choo, who stepped down from the COO role to address health issues and will serve as an advisor through 2026. To manage increasing regulatory risks across tech and real estate, Zillow hired former Google litigation vice president Cassandra Knight as its first chief legal and policy officer. Hofmann will directly oversee two newly elevated internal leaders: Katie Berroth as senior vice president of strategy and operations, and Eric Wilson as senior vice president and general manager of mortgages. The internal job cuts hit Zillow Rentals, product design, product management, and sales and marketing teams as the company consolidates its corporate structure.