Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | ||
Sep. 30, 2013 | Oct. 30, 2013 | Oct. 30, 2013 | |
Class A Common Stock | Class B Common Stock | ||
Document Information [Line Items] | ' | ' | ' |
Document Type | '10-Q | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'Q3 | ' | ' |
Trading Symbol | 'Z | ' | ' |
Entity Registrant Name | 'ZILLOW INC | ' | ' |
Entity Central Index Key | '0001334814 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Accelerated Filer | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 32,787,012 | 6,488,892 |
CONDENSED_BALANCE_SHEETS
CONDENSED BALANCE SHEETS (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $318,888 | $150,040 |
Short-term investments | 46,154 | 44,054 |
Accounts receivable, net of allowance for doubtful accounts of $1,453 and $965 at September 30, 2013 and December 31, 2012, respectively | 15,712 | 8,655 |
Prepaid expenses and other current assets | 5,005 | 2,652 |
Total current assets | 385,759 | 205,401 |
Long-term investments | 59,532 | 9,389 |
Property and equipment, net | 22,528 | 13,634 |
Goodwill | 93,199 | 54,284 |
Intangible assets, net | 30,262 | 21,248 |
Other assets | 381 | 279 |
Total assets | 591,661 | 304,235 |
Current liabilities: | ' | ' |
Accounts payable | 3,987 | 3,158 |
Accrued expenses and other current liabilities | 11,817 | 6,318 |
Accrued compensation and benefits | 4,120 | 2,514 |
Deferred revenue | 10,893 | 8,349 |
Deferred rent, current portion | 198 | 94 |
Total current liabilities | 31,015 | 20,433 |
Deferred rent, net of current portion | 3,395 | 3,485 |
Commitments and contingencies (Note 12) | ' | ' |
Shareholders' equity: | ' | ' |
Additional paid-in capital | 644,083 | 351,981 |
Accumulated deficit | -86,836 | -71,668 |
Total shareholders' equity | 557,251 | 280,317 |
Total liabilities and shareholders' equity | 591,661 | 304,235 |
Convertible Preferred Stock | ' | ' |
Shareholders' equity: | ' | ' |
Preferred stock | ' | ' |
Class A Common Stock | ' | ' |
Shareholders' equity: | ' | ' |
Common Stock | 3 | 3 |
Class B Common Stock | ' | ' |
Shareholders' equity: | ' | ' |
Common Stock | $1 | $1 |
CONDENSED_BALANCE_SHEETS_Paren
CONDENSED BALANCE SHEETS (Parenthetical) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, except Share data, unless otherwise specified | ||
Accounts receivable, allowance for doubtful accounts | $1,453 | $965 |
Convertible Preferred Stock | ' | ' |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 30,000,000 | 30,000,000 |
Preferred stock, shares issued | ' | ' |
Preferred stock, shares outstanding | ' | ' |
Class A Common Stock | ' | ' |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 600,000,000 | 600,000,000 |
Common stock, shares issued | 32,771,388 | 26,414,414 |
Common stock, shares outstanding | 32,771,388 | 26,414,414 |
Class B Common Stock | ' | ' |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 15,000,000 | 15,000,000 |
Common stock, shares issued | 6,488,892 | 7,462,526 |
Common stock, shares outstanding | 6,488,892 | 7,462,526 |
CONDENSED_STATEMENTS_OF_OPERAT
CONDENSED STATEMENTS OF OPERATIONS (USD $) | 3 Months Ended | 9 Months Ended | ||||||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | ||||
Income Statement [Abstract] | ' | ' | ' | ' | ||||
Revenue | $53,311 | $31,915 | $139,197 | $82,513 | ||||
Costs and expenses: | ' | ' | ' | ' | ||||
Cost of revenue (exclusive of amortization) (1) | 5,116 | [1] | 3,623 | [1] | 13,540 | [1] | 10,237 | [1] |
Sales and marketing | 31,195 | 14,118 | 83,913 | 34,586 | ||||
Technology and development | 12,167 | 6,687 | 33,849 | 17,535 | ||||
General and administrative | 10,357 | 5,192 | 27,568 | 14,869 | ||||
Total costs and expenses | 58,835 | 29,620 | 158,870 | 77,227 | ||||
Income (loss) from operations | -5,524 | 2,295 | -19,673 | 5,286 | ||||
Other income | 70 | 39 | 240 | 104 | ||||
Income (loss) before income taxes | -5,454 | 2,334 | -19,433 | 5,390 | ||||
Income tax benefit | 4,265 | ' | 4,265 | ' | ||||
Net income (loss) | ($1,189) | $2,334 | ($15,168) | $5,390 | ||||
Net income (loss) per share - basic | ($0.03) | $0.08 | ($0.43) | $0.19 | ||||
Net income (loss) per share - diluted | ($0.03) | $0.07 | ($0.43) | $0.17 | ||||
Weighted-average shares outstanding - basic | 36,667 | 30,040 | 35,011 | 29,115 | ||||
Weighted-average shares outstanding - diluted | 36,667 | 32,230 | 35,011 | 31,493 | ||||
[1] | Amortization of website development costs and intangible assets included in technology and development |
CONDENSED_STATEMENTS_OF_OPERAT1
CONDENSED STATEMENTS OF OPERATIONS (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Income Statement [Abstract] | ' | ' | ' | ' |
Amortization of website development costs and intangible assets included in technology and development | $5,092 | $3,198 | $13,792 | $7,576 |
CONDENSED_STATEMENTS_OF_CASH_F
CONDENSED STATEMENTS OF CASH FLOWS (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Operating activities | ' | ' |
Net income (loss) | ($15,168) | $5,390 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 15,811 | 8,702 |
Share-based compensation expense | 18,381 | 4,355 |
Release of valuation allowance on certain deferred tax assets | -4,265 | ' |
Loss on disposal of property and equipment | 894 | 114 |
Bad debt expense | 1,181 | 550 |
Deferred rent | -123 | 1,630 |
Amortization of bond premium | 246 | 586 |
Changes in operating assets and liabilities: | ' | ' |
Accounts receivable | -7,267 | -3,546 |
Prepaid expenses and other assets | -1,427 | -7 |
Accounts payable | 723 | 758 |
Accrued expenses and other current liabilities | 1,045 | 1,026 |
Deferred revenue | 2,505 | 2,942 |
Net cash provided by operating activities | 12,536 | 22,500 |
Investing activities | ' | ' |
Proceeds from maturities of investments | 42,000 | 3,600 |
Purchases of investments | -94,489 | ' |
Purchases of property and equipment | -16,434 | -9,652 |
Purchases of intangible assets | -2,629 | -2,525 |
Acquisitions, net of cash acquired of $0 in 2013 and $2,029 in 2012 | -42,615 | -36,405 |
Net cash used in investing activities | -114,167 | -44,982 |
Financing activities | ' | ' |
Proceeds from exercise of Class A common stock options | 16,580 | 6,688 |
Proceeds from public offering, net of offering costs | 253,899 | 156,726 |
Net cash provided by financing activities | 270,479 | 163,414 |
Net increase in cash and cash equivalents during period | 168,848 | 140,932 |
Cash and cash equivalents at beginning of period | 150,040 | 47,926 |
Cash and cash equivalents at end of period | 318,888 | 188,858 |
Noncash transactions: | ' | ' |
Capitalized share-based compensation | 2,814 | 1,779 |
Write-off of fully depreciated property and equipment | $3,215 | $2,986 |
CONDENSED_STATEMENTS_OF_CASH_F1
CONDENSED STATEMENTS OF CASH FLOWS (Parenthetical) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 |
Statement Of Cash Flows [Abstract] | ' | ' |
Acquisitions, cash acquired | $0 | $2,029 |
Organization_and_Description_o
Organization and Description of Business | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Organization and Description of Business | ' |
Note 1. Organization and Description of Business | |
Zillow, Inc. was incorporated as a Washington corporation effective December 13, 2004, and we launched the initial version of our website, Zillow.com, in February 2006. Zillow operates the leading real estate and home-related information marketplaces on mobile and the Web, with a complementary portfolio of brands and products to help people find vital information about homes and connect with local professionals. In addition to our websites, including Zillow.com, we also own and operate Zillow Mobile, our suite of home-related mobile applications, Zillow Mortgage Marketplace, where borrowers connect with lenders to find loans and get competitive mortgage rates, Zillow Digs, our home improvement marketplace where consumers can find visual inspiration and local cost estimates, Zillow Rentals, a marketplace and suite of tools for rental professionals, Postlets, Diverse Solutions, Agentfolio, Mortech, HotPads and StreetEasy. Zillow provides products and services to help consumers through every stage of homeownership – buying, selling, renting, borrowing and remodeling. | |
Certain Significant Risks and Uncertainties | |
We operate in a dynamic industry and, accordingly, can be affected by a variety of factors. For example, we believe that changes in any of the following areas could have a significant negative effect on us in terms of our future financial position, results of operations or cash flows: rates of revenue growth; engagement and usage of our products; scaling and adaptation of existing technology and network infrastructure; competition in our market; management of our growth; acquisitions and investments; qualified employees and key personnel; protection of our brand and intellectual property; changes in government regulation affecting our business; intellectual property infringement and other claims; protection of customers’ information and privacy concerns; and security measures related to our mobile applications and websites, among other things. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2013 | |
Accounting Policies [Abstract] | ' |
Summary of Significant Accounting Policies | ' |
Note 2. Summary of Significant Accounting Policies | |
Basis of Presentation | |
The accompanying condensed financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these interim condensed financial statements should be read in conjunction with the audited financial statements and accompanying notes as of and for the year ended December 31, 2012 included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on February 22, 2013. The condensed balance sheet as of December 31, 2012, included herein, was derived from the audited financial statements as of that date. | |
The unaudited condensed interim financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly our financial position as of September 30, 2013, our results of operations for the three and nine month periods ended September 30, 2013 and 2012, and our cash flows for the nine month periods ended September 30, 2013 and 2012. The results of the three and nine month periods ended September 30, 2013 are not necessarily indicative of the results to be expected for the year ended December 31, 2013 or for any interim period or for any other future year. | |
Use of Estimates | |
The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Estimates are used for revenue recognition, the allowance for doubtful accounts, website development costs, goodwill, recoverability of intangible assets with definite lives and other long-lived assets, and for share-based compensation. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, our financial statements will be affected. | |
Recently Issued Accounting Standards | |
In February 2013, the Financial Accounting Standards Board (“FASB”) issued guidance on the reporting of amounts reclassified out of accumulated other comprehensive income. An entity must report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income. For other amounts that are not required under GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP that provide additional detail about those amounts. This guidance is effective for interim and annual reporting periods beginning after December 15, 2012, with earlier adoption permitted, and must be applied prospectively. We adopted this guidance on January 1, 2013. The adoption of this guidance did not have any impact on our financial position, results of operations or cash flows as we do not have any items of other comprehensive income in any period presented. | |
In July 2013, the FASB issued guidance on the presentation of certain unrecognized tax benefits in the financial statements. This guidance provides that a liability related to an unrecognized tax benefit must be offset against a deferred tax asset for a net operating loss carryforward, a similar tax loss or a tax credit carryforward if such settlement is required or expected in the event the uncertain tax position is disallowed. This guidance is effective for interim and annual reporting periods beginning after December 15, 2013, with earlier adoption permitted, and may be applied prospectively or retrospectively. We expect to adopt this guidance on January 1, 2014. The adoption of this guidance is not expected to have a significant impact on our financial position, results of operations or cash flows as we have provided a full valuation allowance against our net deferred tax assets. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||
Fair Value Measurements | ' | ||||||||||||
Note 3. | Fair Value Measurements | ||||||||||||
Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The standards also establish a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: | |||||||||||||
• | Level 1 — Quoted prices in active markets for identical assets or liabilities. | ||||||||||||
• | Level 2 — Assets and liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities. | ||||||||||||
• | Level 3 — Unobservable inputs that are supported by little or no market activity; instruments valued based on the best available data, some of which is internally developed, and considers risk premiums that a market participant would require. | ||||||||||||
We applied the following methods and assumptions in estimating our fair value measurements: | |||||||||||||
Cash equivalents — Cash equivalents are comprised of highly liquid money market funds with original maturities of less than three months. The fair value measurement of these assets is based on quoted market prices in active markets and, therefore, these assets are recorded at fair value on a recurring basis and classified as Level 1 in the fair value hierarchy. | |||||||||||||
Short-term and long-term investments — Our investments consist of fixed income securities, which include U.S. government agency securities, commercial paper, and corporate notes and bonds. Investments with maturities greater than three months but less than one year are classified as short-term investments. Investments with maturities greater than one year are classified as long-term investments. The fair value measurement of these assets is based on observable market-based inputs or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Our U.S. government agency securities are classified as Level 1 in the fair value hierarchy. Our commercial paper and corporate notes and bonds are classified as Level 2 in the fair value hierarchy. Our short-term and long-term investments are classified as held-to-maturity and are recorded at amortized cost, as we do not intend to sell the investments, and it is not more likely than not that we will be required to sell these investments prior to maturity. The amortized cost of our short-term and long-term investments approximates their fair value. | |||||||||||||
Of the short-term investments and long-term investments on hand as of September 30, 2013, 44% mature on or prior to September 30, 2014, and the remaining 56% mature on or prior to September 30, 2015. | |||||||||||||
The following tables present the balances of assets measured at fair value on a recurring basis as of the dates presented (in thousands): | |||||||||||||
September 30, 2013 | |||||||||||||
Total | Level 1 | Level 2 | |||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 301,279 | $ | 301,279 | $ | — | |||||||
Short-term investments: | |||||||||||||
U.S government agency securities | 14,823 | 14,823 | — | ||||||||||
Commercial paper | 3,995 | — | 3,995 | ||||||||||
Corporate notes and bonds | 27,335 | — | 27,335 | ||||||||||
Long-term investments: | |||||||||||||
U.S government agency securities | 11,348 | 11,348 | — | ||||||||||
Corporate notes and bonds | 48,184 | — | 48,184 | ||||||||||
Total | $ | 406,964 | $ | 327,450 | $ | 79,514 | |||||||
December 31, 2012 | |||||||||||||
Total | Level 1 | Level 2 | |||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 143,246 | $ | 143,246 | $ | — | |||||||
Short-term investments: | |||||||||||||
U.S government agency securities | 26,085 | 26,085 | — | ||||||||||
Commercial paper | 16,965 | — | 16,965 | ||||||||||
Corporate notes and bonds | 1,004 | — | 1,004 | ||||||||||
Long-term investments: | |||||||||||||
U.S government agency securities | 7,079 | 7,079 | — | ||||||||||
Corporate notes and bonds | 2,310 | — | 2,310 | ||||||||||
Total | $ | 196,689 | $ | 176,410 | $ | 20,279 | |||||||
We did not have any Level 3 assets or liabilities measured at fair value on a recurring basis as of September 30, 2013 or December 31, 2012. |
Property_and_Equipment_Net
Property and Equipment, Net | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||
Property and Equipment, Net | ' | ||||||||
Note 4. | Property and Equipment, net | ||||||||
The following table presents the detail of property and equipment as of the dates presented (in thousands): | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Website development costs | $ | 44,334 | $ | 33,448 | |||||
Computer equipment | 8,095 | 8,380 | |||||||
Leasehold improvements | 2,328 | 831 | |||||||
Software | 1,724 | 1,209 | |||||||
Construction-in-progress | 5,220 | 3,093 | |||||||
Office equipment, furniture and fixtures | 3,594 | 2,186 | |||||||
Property and equipment | 65,295 | 49,147 | |||||||
Less: accumulated amortization and depreciation | (42,767 | ) | (35,513 | ) | |||||
Property and equipment, net | $ | 22,528 | $ | 13,634 | |||||
We recorded depreciation and amortization expense related to property and equipment (other than website development costs) of $0.8 million and $0.4 million, respectively, during the three months ended September 30, 2013 and 2012, and $2.0 million and $1.1 million, respectively, during the nine months ended September 30, 2013 and 2012. | |||||||||
We capitalized $5.1 million and $3.5 million, respectively, in website development costs during the three months ended September 30, 2013 and 2012, and $13.2 million and $8.9 million, respectively, during the nine months ended September 30, 2013 and 2012. Amortization expense for website development costs included in technology and development expenses was $3.2 million and $1.8 million, respectively, during the three months ended September 30, 2013 and 2012, and $8.6 million and $4.6 million, respectively, during the nine months ended September 30, 2013 and 2012. | |||||||||
Construction-in-progress primarily consists of website development costs that are capitalizable, but for which the associated applications had not been placed in service. |
Acquisition
Acquisition | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Business Combinations [Abstract] | ' | ||||||||||||||||
Acquisition | ' | ||||||||||||||||
Note 5. | Acquisition | ||||||||||||||||
StreetEasy, Inc. | |||||||||||||||||
On August 26, 2013, Zillow, through its wholly owned subsidiary, Strawberry Acquisition, Inc., a Delaware corporation (“Merger Sub”), consummated its acquisition of StreetEasy, Inc., formerly known as NMD Interactive, Inc., d/b/a StreetEasy, a Delaware corporation (“StreetEasy”), pursuant to an Agreement and Plan of Merger (the “Merger Agreement”) by and among Zillow, StreetEasy, Merger Sub and Shareholder Representative Services LLC, acting as the stockholder representative, dated August 16, 2013. Under the terms and subject to the conditions of the Merger Agreement, Merger Sub merged with and into StreetEasy with StreetEasy remaining as the surviving company and a wholly owned subsidiary of Zillow (the “Merger”). The acquisition aligns with our growth strategies, including focusing on consumers and deepening, strengthening, and expanding our marketplaces. With the addition of StreetEasy, Zillow expanded its audience and brand awareness by leveraging StreetEasy’s leadership among both consumers and professionals in the New York region and, in particular, the New York rentals market. | |||||||||||||||||
The total Merger consideration payable to StreetEasy equity holders was approximately $50 million in cash, less certain transaction expenses and as adjusted at closing based on StreetEasy’s net working capital, cash and debt. All vested options to purchase shares of StreetEasy’s common stock were cancelled and, in settlement of such cancellation, the holders of such options became entitled to receive cash payments representing a portion of the Merger consideration as described in the Merger Agreement. A portion of the Merger consideration has been attributed to the substitution of unvested stock options of StreetEasy outstanding as of the closing for stock options to purchase shares of Zillow’s Class A common stock at an exchange ratio implied by the Merger consideration as described in the Merger Agreement. In connection with the closing, $5 million of the Merger consideration otherwise payable to StreetEasy stockholders and holders of vested stock options has been deposited in a third-party escrow account to secure certain indemnification obligations of those equity holders. As of September 30, 2013, accrued expenses and other current liabilities includes $5.6 million payable to certain equity holders of StreetEasy who have not yet claimed their Merger consideration in connection with the acquisition, and prepaid expenses and other current assets includes $0.7 million related to an adjustment to StreetEasy’s net working capital . | |||||||||||||||||
Zillow’s acquisition of StreetEasy has been accounted for as a business combination, and assets acquired and liabilities assumed were recorded at their estimated fair values as of August 26, 2013. Goodwill, which represents the expected synergies from combining the acquired assets and the operations of the acquirer, as well as intangible assets that do not qualify for separate recognition, is measured as of the acquisition date as the excess of consideration transferred, which is also measured at fair value, and the net of the fair values of the assets acquired and the liabilities assumed as of the acquisition date. The purchase price was approximately $48.0 million, as summarized in the following table (in thousands): | |||||||||||||||||
Cash payable for the outstanding stock of StreetEasy | $ | 42,688 | |||||||||||||||
Cash payable for the cancellation of vested options to purchase shares of StreetEasy’s common stock | 2,989 | ||||||||||||||||
Certain transaction expenses and other costs incurred by StreetEasy | 1,924 | ||||||||||||||||
Substituted unvested stock options attributable to pre-combination service | 430 | ||||||||||||||||
Total purchase price | $ | 48,031 | |||||||||||||||
The fair value of StreetEasy’s unvested stock options substituted in connection with the acquisition that relate to post-combination services will be recorded as share-based compensation expense over the related vesting periods. | |||||||||||||||||
Identifiable intangible assets acquired consisted of the following (in thousands): | |||||||||||||||||
Estimated | |||||||||||||||||
Amortization | |||||||||||||||||
Period | |||||||||||||||||
(in years) | |||||||||||||||||
Developed technology | $ | 4,500 | 5 | ||||||||||||||
Customer relationships | 4,900 | 5 | |||||||||||||||
Trademarks | 2,200 | 5 | |||||||||||||||
Total intangible assets acquired | $ | 11,600 | |||||||||||||||
The preliminary estimated fair value of the intangible assets acquired was determined by the Company, and we considered or relied in part upon a valuation report of a third-party expert. We used a cost approach to measure the fair value of the developed technology based on the estimated cost to recreate the technology. We used an income approach to measure the fair value of the customer relationships based on the excess earnings method, whereby the fair value is estimated based upon the present value of cash flows that the applicable asset is expected to generate. We used an income approach to measure the fair value of the trademarks based on the relief-from-royalty method. These fair value measurements were based on Level 3 measurements under the fair value hierarchy. Net tangible assets were valued at their respective carrying amounts, as we believe that these amounts approximate their current fair values. | |||||||||||||||||
The total purchase consideration has been allocated to the assets acquired and liabilities assumed, including identifiable intangible assets, based on their respective fair values at the acquisition date. Based upon the fair values determined by the Company, in which we considered or relied in part upon a valuation report of a third-party expert, the total purchase price was allocated as follows (in thousands): | |||||||||||||||||
Accounts receivable | $ | 971 | |||||||||||||||
Prepaid expenses and other current assets | 227 | ||||||||||||||||
Property and equipment | 1,138 | ||||||||||||||||
Other identifiable tangible assets | 144 | ||||||||||||||||
Total tangible assets | 2,480 | ||||||||||||||||
Accounts payable | (107 | ) | |||||||||||||||
Accrued expenses and other current liabilities | (194 | ) | |||||||||||||||
Accrued compensation and benefits | (224 | ) | |||||||||||||||
Other identifiable liabilities | (174 | ) | |||||||||||||||
Net deferred tax liability | (4,265 | ) | |||||||||||||||
Total liabilities | (4,964 | ) | |||||||||||||||
Net acquired liabilities | (2,484 | ) | |||||||||||||||
Identifiable intangible assets | 11,600 | ||||||||||||||||
Goodwill | 38,915 | ||||||||||||||||
Total purchase price allocation | $ | 48,031 | |||||||||||||||
Our estimates and assumptions related to the purchase price allocation are preliminary and subject to change during the measurement period (up to one year from the acquisition date) as Zillow finalizes the amount of goodwill recorded in connection with the acquisition, which may be impacted by an adjustment in StreetEasy’s acquisition date working capital. | |||||||||||||||||
Acquisition-related expenses incurred for the three and nine months ended September 30, 2013, including legal and accounting fees and other external costs directly related to the acquisition, were not significant, were expensed as incurred, and are included in general and administrative expenses. | |||||||||||||||||
The results of operations related to the acquisition of StreetEasy have been included in our financial statements since the date of acquisition of August 26, 2013, and are not significant. | |||||||||||||||||
The following pro forma condensed combined financial information gives effect to the acquisition of StreetEasy as if it were consummated on January 1, 2012 (the beginning of the comparable prior reporting period), and includes pro forma adjustments related to the amortization of acquired intangible assets, share-based compensation expense and direct and incremental transaction costs reflected in the historical financial statements. The pro forma condensed combined financial information is presented for informational purposes only. The pro forma condensed combined financial information is not intended to represent or be indicative of the results of operations that would have been reported had the acquisition occurred on January 1, 2012 and should not be taken as representative of future results of operations of the combined company. | |||||||||||||||||
The following table presents the pro forma condensed combined financial information (in thousands, except per share amounts): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Revenue | $ | 54,446 | $ | 33,308 | $ | 143,738 | $ | 86,692 | |||||||||
Net income (loss) | $ | (1,604 | ) | $ | 1,984 | $ | (16,836 | ) | $ | 4,340 | |||||||
Net income (loss) per share - basic | $ | (0.04 | ) | $ | 0.07 | $ | (0.48 | ) | $ | 0.15 | |||||||
Net income (loss) per share - diluted | $ | (0.04 | ) | $ | 0.06 | $ | (0.48 | ) | $ | 0.14 | |||||||
Goodwill
Goodwill | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||
Goodwill | ' | ||||
Note 6. | Goodwill | ||||
The following table presents the change in goodwill from December 31, 2012 through September 30, 2013 (in thousands): | |||||
Balance as of December 31, 2012 | $ | 54,284 | |||
Goodwill recorded in connection with the acquisition of StreetEasy | 38,915 | ||||
Balance as of September 30, 2013 | $ | 93,199 | |||
The goodwill recorded in connection with the acquisition of StreetEasy is not deductible for tax purposes. | |||||
Intangible_Assets_Net
Intangible Assets, Net | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||
Intangible Assets, Net | ' | ||||||||||||
Note 7. | Intangible Assets, net | ||||||||||||
The following tables present the detail of intangible assets subject to amortization as of the dates presented (in thousands): | |||||||||||||
September 30, 2013 | |||||||||||||
Cost | Accumulated | Net | |||||||||||
Amortization | |||||||||||||
Developed technology | $ | 18,835 | $ | (3,559 | ) | $ | 15,276 | ||||||
Purchased content | 11,673 | (8,004 | ) | 3,669 | |||||||||
Customer relationships | 9,775 | (1,282 | ) | 8,493 | |||||||||
Trademarks | 3,261 | (437 | ) | 2,824 | |||||||||
Total | $ | 43,544 | $ | (13,282 | ) | $ | 30,262 | ||||||
December 31, 2012 | |||||||||||||
Cost | Accumulated | Net | |||||||||||
Amortization | |||||||||||||
Developed technology | $ | 14,335 | $ | (1,534 | ) | $ | 12,801 | ||||||
Purchased content | 9,044 | (6,015 | ) | 3,029 | |||||||||
Customer relationships | 4,875 | (387 | ) | 4,488 | |||||||||
Trademarks | 1,061 | (131 | ) | 930 | |||||||||
Total | $ | 29,315 | $ | (8,067 | ) | $ | 21,248 | ||||||
Amortization expense recorded for intangible assets for the three months ended September 30, 2013 and 2012 was $1.9 million and $1.4 million, respectively. Amortization expense recorded for intangible assets for the nine months ended September 30, 2013 and 2012 was $5.2 million and $3.0 million, respectively. These amounts are included in technology and development expenses. | |||||||||||||
Estimated future amortization expense for intangible assets, including amortization related to future commitments, as of September 30, 2013 is as follows (in thousands): | |||||||||||||
Remainder of 2013 | $ | 2,750 | |||||||||||
2014 | 10,908 | ||||||||||||
2015 | 10,671 | ||||||||||||
2016 | 9,530 | ||||||||||||
2017 | 5,906 | ||||||||||||
All future years | 4,915 | ||||||||||||
Total future estimated amortization expense | $ | 44,680 | |||||||||||
Income_Taxes
Income Taxes | 9 Months Ended | |
Sep. 30, 2013 | ||
Income Tax Disclosure [Abstract] | ' | |
Income Taxes | ' | |
Note 8. | Income Taxes | |
We are subject to federal and state income taxes in the United States. During the three and nine month periods ended September 30, 2013 and 2012, we did not have reportable taxable income, and we are not projecting reportable taxable income for the year ending December 31, 2013. We have provided a full valuation allowance against our net deferred tax assets as of September 30, 2013 and December 31, 2012 because, based on the weight of available evidence, it is more likely than not (a likelihood of more than 50%) that some or all of the deferred tax assets will not be realized. Therefore, no tax liability or expense has been recorded in the financial statements. We have accumulated tax losses of approximately $115.7 million as of December 31, 2012, which are available to reduce future taxable income. | ||
We recorded an income tax benefit of $4.3 million for the three and nine month periods ended September 30, 2013 due to the use of the deferred tax liability generated in connection with Zillow’s August 26, 2013 acquisition of StreetEasy that can be used to realize certain deferred tax assets for which we had previously provided a full allowance. |
Shareholders_Equity
Shareholders' Equity | 9 Months Ended | |
Sep. 30, 2013 | ||
Equity [Abstract] | ' | |
Shareholders' Equity | ' | |
Note 9. | Shareholders’ Equity | |
Our board of directors has the authority to fix and determine and to amend the number of shares of any series of preferred stock that is wholly unissued or to be established and to fix and determine and to amend the designation, preferences, voting powers and limitations, and the relative, participating, optional or other rights, of any series of shares of preferred stock that is wholly unissued or to be established, subject in each case to certain approval rights of holders of our outstanding Class B common stock. There was no preferred stock issued and outstanding as of September 30, 2013 or December 31, 2012. | ||
Our Class A common stock has no preferences or privileges and is not redeemable. Holders of Class A common stock are entitled to one vote for each share. | ||
Our Class B common stock has no preferences or privileges and is not redeemable. At any time after the date of issuance, each share of Class B common stock, at the option of the holder, may be converted into one share of Class A common stock, or automatically converted upon the affirmative vote by or written consent of holders of a majority of the shares of the Class B common stock. During the three and nine month periods ended September 30, 2013, 600,000 shares and 973,634 shares of Class B common stock, respectively, were converted into Class A common stock at the option of the holders. During the year ended December 31, 2012, 2,065,787 shares of Class B common stock were converted into Class A common stock at the option of the holders. Holders of Class B common stock are entitled to 10 votes for each share. | ||
In September 2012, we sold 3,844,818 shares of our Class A common stock, including 419,818 shares of our Class A common stock pursuant to the underwriters’ option to purchase additional shares, and certain shareholders sold 575,000 shares of our Class A common stock, at a price of $43.00 per share. We received net proceeds of $156.7 million after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We received no proceeds from the sale of our Class A common stock by the selling shareholders. | ||
In August 2013, we sold 3,253,522 shares of our Class A common stock, including 753,522 shares of our Class A common stock pursuant to the underwriters’ option to purchase additional shares, and certain shareholders sold 2,523,486 shares of our Class A common stock, at a price of $82.00 per share. We received net proceeds of $253.9 million after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We received no proceeds from the sale of our Class A common stock by the selling shareholders. |
ShareBased_Awards
Share-Based Awards | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||||||
Share-Based Awards | ' | ||||||||||||||||||||
Note 10. | Share-Based Awards | ||||||||||||||||||||
On July 19, 2011, our 2011 Incentive Plan (as amended and/or restated from time to time, the “2011 Plan”) became effective and was subsequently amended and restated effective as of June 1, 2012, to, among other things, increase the total number of authorized shares and include the material terms of performance goals for performance-based awards. The 2011 Plan was amended effective as of May 31, 2013 to increase the number of authorized shares of Class A common stock available for awards under the 2011 Plan by 1,500,000 shares. The 2011 Plan is administered by the compensation committee of the board of directors. Under the terms of the 2011 Plan, the compensation committee of the board of directors may grant equity awards, including incentive stock options, nonqualified stock options, restricted stock or restricted stock units, to employees, officers, directors, consultants, agents, advisors and independent contractors. The compensation committee has also authorized certain senior executive officers to grant equity awards under the 2011 Plan, within limits prescribed by the compensation committee. | |||||||||||||||||||||
Stock Options | |||||||||||||||||||||
All stock options granted from inception through September 30, 2013 are nonqualified stock options, with the exception of substituted incentive stock options for 15,143 shares of Zillow’s Class A common stock that were granted in connection with the December 14, 2012 acquisition of HotPads, Inc. Options under the 2011 Plan are granted with an exercise price per share not less than 100% of the fair market value of our Class A common stock on the date of grant, with the exception of substituted stock options granted in connection with acquisitions, and are exercisable at such times and under such conditions as determined by the compensation committee. Under the 2011 Plan, the maximum term of an option is ten years from the date of grant. Any portion of an option that is not vested and exercisable on the date of a participant’s termination of service expires on such date. Employees generally forfeit their rights to exercise vested options after 3 months following their termination of employment or 12 months in the event of termination by reason of death, disability or retirement. Options granted under the 2011 Plan are typically granted with seven-year terms and typically vest 25% after 12 months and ratably thereafter over the next 36 months, except for options granted under the Stock Option Grant Program for Nonemployee Directors (“Nonemployee Director Awards”), which are fully vested and exercisable on the date of grant, and except for certain options granted to the Company’s chief executive officer in December 2012 and January 2013. | |||||||||||||||||||||
The following table summarizes stock option activity for the year ended December 31, 2012 and the nine months ended September 30, 2013: | |||||||||||||||||||||
Shares | Number | Weighted- | Weighted- | Aggregate | |||||||||||||||||
Available | of Shares | Average | Average | Intrinsic | |||||||||||||||||
for Grant | Subject to | Exercise | Remaining | Value | |||||||||||||||||
Existing | Price Per | Contractual | |||||||||||||||||||
Options | Share | Life (Years) | |||||||||||||||||||
Outstanding at January 1, 2012 | 979,024 | 5,361,256 | $ | 6.23 | 4.51 | $ | 89,749,207 | ||||||||||||||
Authorized increase in plan shares | 1,068,374 | — | — | ||||||||||||||||||
Granted | (1,884,079 | ) | 1,884,079 | 30.01 | |||||||||||||||||
Exercised | — | (1,624,304 | ) | 4.59 | |||||||||||||||||
Forfeited or cancelled | 158,359 | (158,359 | ) | 21.42 | |||||||||||||||||
Outstanding at December 31, 2012 | 321,678 | 5,462,672 | 14.48 | 4.88 | 78,912,364 | ||||||||||||||||
Authorized increase in plan shares | 2,887,064 | — | — | ||||||||||||||||||
Granted | (1,910,112 | ) | 1,910,112 | 42.08 | |||||||||||||||||
Exercised | — | (1,897,086 | ) | 8.73 | |||||||||||||||||
Forfeited or cancelled | 233,287 | (233,287 | ) | 30.34 | |||||||||||||||||
Outstanding at September 30, 2013 | 1,531,917 | 5,242,411 | 25.91 | 5.58 | 307,130,888 | ||||||||||||||||
Vested and exercisable at September 30, 2013 | 1,370,030 | 10.73 | 3.86 | 100,793,939 | |||||||||||||||||
As of September 30, 2013, the numbers above do not include 139,000 shares of restricted stock and 84,287 restricted stock units granted pursuant to our 2011 Plan. The table includes stock option awards granted in substitution of awards previously granted by companies we acquired in 2012 and 2013, which stock option awards do not reduce the number of shares available for future issuance under the 2011 Plan. | |||||||||||||||||||||
The fair value of options granted, excluding Nonemployee Director Awards described below and certain options granted to the Company’s chief executive officer in December 2012 and January 2013, is estimated at the date of grant using the Black-Scholes-Merton option-pricing model, assuming no dividends and with the following assumptions for the periods presented: | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Expected volatility | 54% | 49% | 50% - 54% | 49% - 52% | |||||||||||||||||
Expected dividend yields | — | — | — | — | |||||||||||||||||
Risk-free interest rate | 1.19% - 1.41% | 0.52% - 0.54% | 0.59% - 1.41% | 0.52% - 0.91% | |||||||||||||||||
Weighted-average expected life | 4.58 years | 4.58 years | 4.58 years | 4.58 years | |||||||||||||||||
Weighted-average fair value of options granted | $38.14 | $16.21 | $20.23 | $14.66 | |||||||||||||||||
In March 2013, stock options for an aggregate of 30,690 shares of our Class A common stock were granted as Nonemployee Director Awards. The fair value of options granted for the Nonemployee Director Awards, $16.29 per share, is estimated at the date of grant using the Black-Scholes-Merton option-pricing model, assuming no dividends, expected volatility of 51%, a risk-free interest rate of 0.36%, and a weighted-average expected life of 3.5 years. During the three and nine month periods ended September 30, 2013, share-based compensation expense recognized in our statement of operations related to Nonemployee Director Awards was $0 and $0.5 million, respectively, and is included in general and administrative expenses. | |||||||||||||||||||||
Restricted Stock Awards | |||||||||||||||||||||
The following table summarizes restricted stock award activity for the year ended December 31, 2012 and the nine months ended September 30, 2013: | |||||||||||||||||||||
Shares of | Weighted- | ||||||||||||||||||||
Restricted Stock | Average Grant- | ||||||||||||||||||||
Date Fair | |||||||||||||||||||||
Value | |||||||||||||||||||||
Unvested outstanding at January 1, 2012 | 75,000 | $ | 29.69 | ||||||||||||||||||
Granted | 299,213 | 30.43 | |||||||||||||||||||
Vested | (34,110 | ) | 29.41 | ||||||||||||||||||
Forfeited or cancelled | — | — | |||||||||||||||||||
Unvested outstanding at December 31, 2012 | 340,103 | 30.34 | |||||||||||||||||||
Granted | 3,673 | 44.66 | |||||||||||||||||||
Vested | (22,423 | ) | 32.14 | ||||||||||||||||||
Forfeited or cancelled | (6,540 | ) | 26.28 | ||||||||||||||||||
Unvested outstanding at September 30, 2013 | 314,813 | 31.31 | |||||||||||||||||||
The fair value of the outstanding shares of restricted stock awards will be recorded as share-based compensation expense over the vesting period. As of September 30, 2013, there was $7.8 million of total unrecognized compensation cost related to restricted stock awards. | |||||||||||||||||||||
Restricted Stock Units | |||||||||||||||||||||
The following table summarizes activity for restricted stock units for the year ended December 31, 2012 and the nine months ended September 30, 2013: | |||||||||||||||||||||
Restricted Stock | Weighted- | ||||||||||||||||||||
Units | Average Grant- | ||||||||||||||||||||
Date Fair | |||||||||||||||||||||
Value | |||||||||||||||||||||
Unvested outstanding at January 1, 2012 | — | $ | — | ||||||||||||||||||
Granted | 300,961 | 38.77 | |||||||||||||||||||
Vested | — | — | |||||||||||||||||||
Forfeited or cancelled | (4,957 | ) | 39.69 | ||||||||||||||||||
Unvested outstanding at December 31, 2012 | 296,004 | 38.76 | |||||||||||||||||||
Granted | 30,875 | 83.74 | |||||||||||||||||||
Vested | (234,002 | ) | 39.69 | ||||||||||||||||||
Forfeited or cancelled | (8,590 | ) | 39.69 | ||||||||||||||||||
Unvested outstanding at September 30, 2013 | 84,287 | 55.83 | |||||||||||||||||||
In April 2013, pursuant to the terms of a Restricted Stock Unit Award Notice and Restricted Stock Unit Award Agreement between Zillow and a former employee, 218,071 unvested restricted stock units held by such employee became vested, such that the former employee received one share of Zillow’s Class A common stock for each outstanding restricted stock unit. As a result of the accelerated vesting of the restricted stock units, we recognized approximately $7.1 million of share-based compensation expense during the nine months ended September 30, 2013, which is included within sales and marketing expense. | |||||||||||||||||||||
In September 2013, pursuant to the terms of a Restricted Stock Unit Award Notice and Restricted Stock Unit Agreement entered into between Zillow and an employee, Zillow granted to the employee restricted stock units for 26,000 shares of our Class A common stock. One twelfth of each restricted stock unit award will vest on each one-month anniversary of the vesting commencement date of September 20, 2013, subject to the recipient’s continued full-time employment or service to Zillow. In the event of termination of service during the first six months of employment by Zillow without cause or upon the resignation by such employee for good reason, 13,000 of the restricted stock units, less the number of restricted stock units that already vested prior to termination, will become vested units, and such employee will be entitled to receive one share of Zillow’s Class A common stock for each then outstanding unit. The grant date fair value of the restricted stock units is approximately $2.3 million. | |||||||||||||||||||||
The fair value of restricted stock units will be recorded as share-based compensation expense over the vesting period. As of September 30, 2013, there was $4.3 million of total unrecognized compensation cost related to restricted stock units. | |||||||||||||||||||||
Share-Based Compensation Expense | |||||||||||||||||||||
The following table presents the effects of share-based compensation in our statements of operations during the periods presented (in thousands): | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Cost of revenue | $ | 185 | $ | 94 | $ | 524 | $ | 271 | |||||||||||||
Sales and marketing | 871 | 870 | 9,875 | 1,349 | |||||||||||||||||
Technology and development | 985 | 374 | 3,053 | 1,182 | |||||||||||||||||
General and administrative | 1,727 | 374 | 4,929 | 1,553 | |||||||||||||||||
Total | $ | 3,768 | $ | 1,712 | $ | 18,381 | $ | 4,355 | |||||||||||||
Net_Income_Loss_Per_Share
Net Income (Loss) Per Share | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Net Income (Loss) Per Share | ' | ||||||||||||||||
Note 11. | Net Income (Loss) Per Share | ||||||||||||||||
Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares (including Class A common stock and Class B common stock) outstanding during the period. In the calculation of basic net income (loss) per share, undistributed earnings are allocated assuming all earnings during the period were distributed. | |||||||||||||||||
Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares (including Class A common stock and Class B common stock) outstanding during the period and potentially dilutive Class A common stock equivalents, except in cases where the effect of the Class A common stock equivalent would be antidilutive. Potential Class A common stock equivalents consist of Class A common stock issuable upon exercise of stock options and Class A common stock underlying unvested restricted stock and unvested restricted stock units using the treasury stock method. | |||||||||||||||||
For the periods presented, the following Class A common stock equivalents were included in the computation of diluted net income per share because they had a dilutive impact (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Class A common stock issuable upon the exercise of stock options | — | 2,142 | — | 2,324 | |||||||||||||
Class A common stock underlying unvested restricted stock awards | — | 44 | — | 54 | |||||||||||||
Class A common stock underlying unvested restricted stock units | — | 4 | — | — | |||||||||||||
Total Class A common stock equivalents | — | 2,190 | — | 2,378 | |||||||||||||
For the periods presented, the following Class A common stock equivalents were excluded from the calculations of diluted net loss per share because their effects would have been antidilutive (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Class A common stock issuable upon the exercise of stock options | 3,402 | — | 3,190 | — | |||||||||||||
Class A common stock underlying unvested restricted stock awards | 105 | — | 91 | — | |||||||||||||
Class A common stock underlying unvested restricted stock units | 36 | — | 90 | — | |||||||||||||
Total Class A common stock equivalents | 3,543 | — | 3,371 | — | |||||||||||||
In the event of liquidation, dissolution, distribution of assets or winding-up of the Company, the holders of all classes of common stock have equal rights to receive all the assets of the Company after the rights of the holders of outstanding preferred stock have been satisfied. We have not presented net income (loss) per share under the two-class method for our Class | |||||||||||||||||
A common stock and Class B common stock because it would be the same for each class due to equal dividend and liquidation rights for each class. | |||||||||||||||||
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||
Commitments and Contingencies | ' | ||||
Note 12. | Commitments and Contingencies | ||||
Lease Commitments | |||||
We have various operating leases for office space and equipment. In March 2011, we entered into a lease for approximately 66,000 square feet of office space that houses our corporate headquarters in Seattle, Washington, for which we are obligated to make escalating monthly lease payments that began in December 2012 and continue through November 2022. In June 2012, we entered into a lease amendment for our corporate headquarters in Seattle, Washington, which increased the rentable area of the premises by 21,575 square feet, for which we are obligated to make escalating monthly lease payments that began in January 2013 and continue through November 2022. In April 2013, we entered into a lease amendment for our corporate headquarters in Seattle, Washington, which will increase the rentable area of the premises by 22,583 square feet as of October 1, 2013, and will increase the rentable area of the premises by an additional 22,583 square feet as of September 1, 2014, for which we are obligated to make escalating monthly lease payments beginning in January 2014 and continuing through November 2022. In April 2012, we entered into an operating lease in Irvine, California for 20,025 square feet under which we are obligated to make escalating monthly lease payments which began in August 2012 and continue through July 2022. In September 2013, we entered into a lease amendment for our operating lease in Irvine, California, which increased the rentable area of the premises by 20,024 square feet, for which we are obligated to make escalating monthly lease payments beginning in February 2014 and continuing through July 2022. In November 2012, we entered into an operating lease in San Francisco, California for 18,353 square feet under which we are obligated to make escalating monthly lease payments which began in December 2012 and continue through November 2018. We lease additional office space in Chicago, Illinois, Lincoln, Nebraska, and New York, New York. | |||||
Future minimum payments for all operating leases as of September 30, 2013 are as follows (in thousands): | |||||
Remainder of 2013 | $ | 1,100 | |||
2014 | 5,811 | ||||
2015 | 7,005 | ||||
2016 | 7,368 | ||||
2017 | 7,446 | ||||
All future years | 31,328 | ||||
Total future minimum lease payments | $ | 60,058 | |||
Rent expense for the three months ended September 30, 2013 and 2012 was $1.1 million and $0.7 million, respectively. Rent expense for the nine months ended September 30, 2013 and 2012 was $3.3 million and $1.8 million, respectively. | |||||
Purchase Commitments | |||||
As of September 30, 2013, we had non-cancelable purchase commitments for content related to our mobile applications and websites totaling $13.7 million. The amounts due for this content as of September 30, 2013 are as follows (in thousands): | |||||
Remainder of 2013 | $ | 1,021 | |||
2014 | 4,157 | ||||
2015 | 4,291 | ||||
2016 | 3,435 | ||||
2017 | 817 | ||||
Total future purchase commitments | $ | 13,721 | |||
Line of Credit and Letters of Credit | |||||
During March 2011, we entered into a loan and security agreement with a financial institution to establish a line of credit of $4.0 million. In April 2012, we amended our loan and security agreement to increase our line of credit from $4.0 million to $25.0 million. In September 2013, we terminated the loan and security agreement. | |||||
In March 2011, we executed a standby letter of credit of $1.5 million in connection with the lease of our Seattle offices, and in July 2012, we amended the standby letter of credit to increase the amount to approximately $1.7 million. In connection with the April 2013 amendment to the lease of our Seattle offices, we amended our standby letter of credit to increase the amount from approximately $1.7 million to approximately $2.0 million. In November 2012, we executed a letter of credit of approximately $0.2 million in connection with the lease of our San Francisco office. The letters of credit are secured by our investments and are effective until 60 days after the expiration date of the lease. | |||||
Legal Proceedings | |||||
In March 2010, Smarter Agent, LLC (“Smarter Agent”) filed a complaint against us and multiple other defendants for patent infringement in the U.S. District Court for the District of Delaware. The complaint seeks, among other things, a judgment that we may have infringed certain patents held by Smarter Agent, an injunctive order against the alleged infringing activities and an award for damages. In November 2010, the U.S. Patent Office granted our petition for re-examination of the three patents-in-suit, and in an initial office action rejected all claims. In March 2011, the court granted a stay of the litigation pending the completion of the re-examination proceedings. We were granted a stay against the patent infringement complaint. In addition, in October 2011, Smarter Agent filed a substantially similar complaint against Diverse Solutions, Inc. (“Diverse Solutions”), StreetEasy, and other defendants, for patent infringement in the U.S. District Court for the District of Delaware. On October 31, 2011, we acquired substantially all of the operating assets and certain liabilities of Diverse Solutions, including the Smarter Agent complaint against Diverse Solutions. On August 26, 2013, we acquired StreetEasy, including the Smarter Agent complaint against StreetEasy. In addition, in March 2010, Smarter Agent filed a substantially similar complaint against HotPads, Inc. (“HotPads”), and other defendants, for patent infringement in the U.S. District Court for the District of Delaware. On December 14, 2012, we acquired HotPads, including the Smarter Agent complaint against HotPads. We have not recorded an accrual related to these complaints as of September 30, 2013 or December 31, 2012 as we do not believe a material loss is probable. It is a reasonable possibility that a loss may be incurred; however, the possible loss or range of loss is not estimable. | |||||
In September 2010, LendingTree, LLC filed a complaint against us for patent infringement in the U.S. District Court for the Western District of North Carolina. The complaint seeks, among other things, a judgment that we may have infringed certain patents held by LendingTree, an injunctive order against the alleged infringing activities and an award for damages. We have denied the allegations and asserted counterclaims seeking declarations that we are not infringing the patents and that the patents are unenforceable and invalid. We have not recorded an accrual related to this complaint as of September 30, 2013 or December 31, 2012 as we do not believe a material loss is probable. It is a reasonable possibility that a loss may be incurred; however, the possible loss or range of loss is not estimable. | |||||
In November 2012, a securities class action lawsuit was filed against us and certain of our executive officers seeking unspecified damages in the U.S. District Court for the Western District of Washington at Seattle. The complaint purports to state claims for violations of federal securities laws on behalf of a class of those who purchased our common stock between February 15, 2012 and November 6, 2012. A consolidated amended complaint was filed in June 2013. In general, the complaint alleges, among other things, that during the period between February 15, 2012 and November 6, 2012, we issued materially false and misleading statements regarding our business practices and financial results. In August 2013, we moved to dismiss the lawsuit. That motion to dismiss is pending. We intend to deny the allegations of any wrongdoing and vigorously defend the claims in the lawsuit. We have not recorded an accrual related to this lawsuit as of September 30, 2013 or December 31, 2012 as we do not believe a material loss is probable. It is a reasonable possibility that a loss may be incurred; however, the possible loss or range of loss is not estimable. | |||||
In January 2013, a shareholder derivative lawsuit was filed against certain of our executive officers and directors seeking unspecified damages on behalf of Zillow in the U.S. District Court for the Western District of Washington at Seattle. In general, the complaint alleged, among other things, that the defendants breached their fiduciary obligations owed to Zillow, and that as a result of the breach of such fiduciary duties, Zillow wasted corporate assets defending itself in the securities class action lawsuit described above, and that defendants were unjustly enriched by selling shares of our common stock on the basis of knowledge of adverse trends before such information was publicly disclosed. The shareholder derivative lawsuit was dismissed without prejudice on September 26, 2013, and we therefore have not recorded an accrual related to this lawsuit as of September 30, 2013 or December 31, 2012. | |||||
In addition to the aforementioned, from time to time, we are involved in litigation and claims that arise in the ordinary course of business. Although we cannot be certain of the outcome of any litigation and claims, nor the amount of damages and exposure that we could incur, we currently believe that the final disposition of such matters will not have a material effect on our financial position, results of operations or cash flow. This forward-looking statement is based on management’s current understanding of the relevant law and facts, and it is subject to various contingencies, including the potential costs and risks associated with litigation and the actions of arbitrators, judges and juries. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. |
Segment_Information_and_Revenu
Segment Information and Revenue | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Segment Information and Revenue | ' | ||||||||||||||||
Note 13. | Segment Information and Revenue | ||||||||||||||||
We have one reportable segment. Our reportable segment has been identified based on how our chief operating decision-maker manages our business, makes operating decisions and evaluates operating performance. The chief executive officer acts as the chief operating decision-maker and reviews financial and operational information on an entity-wide basis. We have one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components. Accordingly, we have determined that we have a single reporting segment and operating unit structure. | |||||||||||||||||
The chief executive officer reviews information about revenue categories, including marketplace revenue and display revenue. The following table presents our revenue categories during the periods presented (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Marketplace revenue: | |||||||||||||||||
Real estate | $ | 35,136 | $ | 21,002 | $ | 91,882 | $ | 52,232 | |||||||||
Mortgages | 5,742 | 2,614 | 16,465 | 7,600 | |||||||||||||
Total Marketplace revenue | 40,878 | 23,616 | 108,347 | 59,832 | |||||||||||||
Display revenue | 12,433 | 8,299 | 30,850 | 22,681 | |||||||||||||
Total revenue | $ | 53,311 | $ | 31,915 | $ | 139,197 | $ | 82,513 | |||||||||
Subsequent_Events
Subsequent Events | 9 Months Ended | |
Sep. 30, 2013 | ||
Subsequent Events [Abstract] | ' | |
Subsequent Events | ' | |
Note 14. | Subsequent Events | |
In connection with our acquisition of StreetEasy, we granted restricted stock units for an aggregate 54,929 shares of our Class A common stock in October 2013 to certain former employees of StreetEasy who accepted employment with Zillow. The grant date fair value of the restricted stock units is approximately $4.4 million. In general, each restricted stock unit award will vest in substantially equal installments on each one-month anniversary of the vesting commencement date over a four-year period, subject to the recipient’s continued employment with or service to Zillow. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 9 Months Ended | |||
Sep. 30, 2013 | ||||
Accounting Policies [Abstract] | ' | |||
Basis of Presentation | ' | |||
Basis of Presentation | ||||
The accompanying condensed financial statements have been prepared in conformity with accounting principles generally accepted in the United States (“GAAP”) and applicable rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these interim condensed financial statements should be read in conjunction with the audited financial statements and accompanying notes as of and for the year ended December 31, 2012 included in the Company’s Annual Report on Form 10-K, which was filed with the SEC on February 22, 2013. The condensed balance sheet as of December 31, 2012, included herein, was derived from the audited financial statements as of that date. | ||||
The unaudited condensed interim financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, necessary to present fairly our financial position as of September 30, 2013, our results of operations for the three and nine month periods ended September 30, 2013 and 2012, and our cash flows for the nine month periods ended September 30, 2013 and 2012. The results of the three and nine month periods ended September 30, 2013 are not necessarily indicative of the results to be expected for the year ended December 31, 2013 or for any interim period or for any other future year. | ||||
Use of Estimates | ' | |||
Use of Estimates | ||||
The preparation of financial statements in conformity with GAAP requires management to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and the related disclosures at the date of the financial statements, as well as the reported amounts of revenue and expenses during the periods presented. Estimates are used for revenue recognition, the allowance for doubtful accounts, website development costs, goodwill, recoverability of intangible assets with definite lives and other long-lived assets, and for share-based compensation. To the extent there are material differences between these estimates, judgments, or assumptions and actual results, our financial statements will be affected. | ||||
Recently Issued Accounting Standards | ' | |||
Recently Issued Accounting Standards | ||||
In February 2013, the Financial Accounting Standards Board (“FASB”) issued guidance on the reporting of amounts reclassified out of accumulated other comprehensive income. An entity must report the effect of significant reclassifications out of accumulated other comprehensive income on the respective line items in net income if the amount being reclassified is required under GAAP to be reclassified in its entirety to net income. For other amounts that are not required under GAAP to be reclassified in their entirety to net income in the same reporting period, an entity is required to cross-reference other disclosures required under GAAP that provide additional detail about those amounts. This guidance is effective for interim and annual reporting periods beginning after December 15, 2012, with earlier adoption permitted, and must be applied prospectively. We adopted this guidance on January 1, 2013. The adoption of this guidance did not have any impact on our financial position, results of operations or cash flows as we do not have any items of other comprehensive income in any period presented. | ||||
In July 2013, the FASB issued guidance on the presentation of certain unrecognized tax benefits in the financial statements. This guidance provides that a liability related to an unrecognized tax benefit must be offset against a deferred tax asset for a net operating loss carryforward, a similar tax loss or a tax credit carryforward if such settlement is required or expected in the event the uncertain tax position is disallowed. This guidance is effective for interim and annual reporting periods beginning after December 15, 2013, with earlier adoption permitted, and may be applied prospectively or retrospectively. We expect to adopt this guidance on January 1, 2014. The adoption of this guidance is not expected to have a significant impact on our financial position, results of operations or cash flows as we have provided a full valuation allowance against our net deferred tax assets. | ||||
Fair Value Measurements | ' | |||
Accounting standards define fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The standards also establish a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. There are three levels of inputs that may be used to measure fair value: | ||||
• | Level 1 — Quoted prices in active markets for identical assets or liabilities. | |||
• | Level 2 — Assets and liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities. | |||
• | Level 3 — Unobservable inputs that are supported by little or no market activity; instruments valued based on the best available data, some of which is internally developed, and considers risk premiums that a market participant would require. | |||
Net Income (Loss) Per Share | ' | |||
Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares (including Class A common stock and Class B common stock) outstanding during the period. In the calculation of basic net income (loss) per share, undistributed earnings are allocated assuming all earnings during the period were distributed. | ||||
Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of common shares (including Class A common stock and Class B common stock) outstanding during the period and potentially dilutive Class A common stock equivalents, except in cases where the effect of the Class A common stock equivalent would be antidilutive. Potential Class A common stock equivalents consist of Class A common stock issuable upon exercise of stock options and Class A common stock underlying unvested restricted stock and unvested restricted stock units using the treasury stock method. | ||||
Segment Information and Revenue | ' | |||
We have one reportable segment. Our reportable segment has been identified based on how our chief operating decision-maker manages our business, makes operating decisions and evaluates operating performance. The chief executive officer acts as the chief operating decision-maker and reviews financial and operational information on an entity-wide basis. We have one business activity and there are no segment managers who are held accountable for operations, operating results or plans for levels or components. Accordingly, we have determined that we have a single reporting segment and operating unit structure. |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||
Fair Value Measurements of Assets on Recurring Basis | ' | ||||||||||||
The following tables present the balances of assets measured at fair value on a recurring basis as of the dates presented (in thousands): | |||||||||||||
September 30, 2013 | |||||||||||||
Total | Level 1 | Level 2 | |||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 301,279 | $ | 301,279 | $ | — | |||||||
Short-term investments: | |||||||||||||
U.S government agency securities | 14,823 | 14,823 | — | ||||||||||
Commercial paper | 3,995 | — | 3,995 | ||||||||||
Corporate notes and bonds | 27,335 | — | 27,335 | ||||||||||
Long-term investments: | |||||||||||||
U.S government agency securities | 11,348 | 11,348 | — | ||||||||||
Corporate notes and bonds | 48,184 | — | 48,184 | ||||||||||
Total | $ | 406,964 | $ | 327,450 | $ | 79,514 | |||||||
December 31, 2012 | |||||||||||||
Total | Level 1 | Level 2 | |||||||||||
Cash equivalents: | |||||||||||||
Money market funds | $ | 143,246 | $ | 143,246 | $ | — | |||||||
Short-term investments: | |||||||||||||
U.S government agency securities | 26,085 | 26,085 | — | ||||||||||
Commercial paper | 16,965 | — | 16,965 | ||||||||||
Corporate notes and bonds | 1,004 | — | 1,004 | ||||||||||
Long-term investments: | |||||||||||||
U.S government agency securities | 7,079 | 7,079 | — | ||||||||||
Corporate notes and bonds | 2,310 | — | 2,310 | ||||||||||
Total | $ | 196,689 | $ | 176,410 | $ | 20,279 | |||||||
Property_and_Equipment_Net_Tab
Property and Equipment, Net (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2013 | |||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||
Details of Property and Equipment | ' | ||||||||
The following table presents the detail of property and equipment as of the dates presented (in thousands): | |||||||||
September 30, | December 31, | ||||||||
2013 | 2012 | ||||||||
Website development costs | $ | 44,334 | $ | 33,448 | |||||
Computer equipment | 8,095 | 8,380 | |||||||
Leasehold improvements | 2,328 | 831 | |||||||
Software | 1,724 | 1,209 | |||||||
Construction-in-progress | 5,220 | 3,093 | |||||||
Office equipment, furniture and fixtures | 3,594 | 2,186 | |||||||
Property and equipment | 65,295 | 49,147 | |||||||
Less: accumulated amortization and depreciation | (42,767 | ) | (35,513 | ) | |||||
Property and equipment, net | $ | 22,528 | $ | 13,634 | |||||
Acquisition_Tables
Acquisition (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Business Combinations [Abstract] | ' | ||||||||||||||||
Summary of Purchase Price | ' | ||||||||||||||||
The purchase price was approximately $48.0 million, as summarized in the following table (in thousands): | |||||||||||||||||
Cash payable for the outstanding stock of StreetEasy | $ | 42,688 | |||||||||||||||
Cash payable for the cancellation of vested options to purchase shares of StreetEasy’s common stock | 2,989 | ||||||||||||||||
Certain transaction expenses and other costs incurred by StreetEasy | 1,924 | ||||||||||||||||
Substituted unvested stock options attributable to pre-combination service | 430 | ||||||||||||||||
Total purchase price | $ | 48,031 | |||||||||||||||
Identifiable Intangible Assets Acquired | ' | ||||||||||||||||
Identifiable intangible assets acquired consisted of the following (in thousands): | |||||||||||||||||
Estimated | |||||||||||||||||
Amortization | |||||||||||||||||
Period | |||||||||||||||||
(in years) | |||||||||||||||||
Developed technology | $ | 4,500 | 5 | ||||||||||||||
Customer relationships | 4,900 | 5 | |||||||||||||||
Trademarks | 2,200 | 5 | |||||||||||||||
Total intangible assets acquired | $ | 11,600 | |||||||||||||||
Purchase Price Allocation | ' | ||||||||||||||||
Based upon the fair values determined by the Company, in which we considered or relied in part upon a valuation report of a third-party expert, the total purchase price was allocated as follows (in thousands): | |||||||||||||||||
Accounts receivable | $ | 971 | |||||||||||||||
Prepaid expenses and other current assets | 227 | ||||||||||||||||
Property and equipment | 1,138 | ||||||||||||||||
Other identifiable tangible assets | 144 | ||||||||||||||||
Total tangible assets | 2,480 | ||||||||||||||||
Accounts payable | (107 | ) | |||||||||||||||
Accrued expenses and other current liabilities | (194 | ) | |||||||||||||||
Accrued compensation and benefits | (224 | ) | |||||||||||||||
Other identifiable liabilities | (174 | ) | |||||||||||||||
Net deferred tax liability | (4,265 | ) | |||||||||||||||
Total liabilities | (4,964 | ) | |||||||||||||||
Net acquired liabilities | (2,484 | ) | |||||||||||||||
Identifiable intangible assets | 11,600 | ||||||||||||||||
Goodwill | 38,915 | ||||||||||||||||
Total purchase price allocation | $ | 48,031 | |||||||||||||||
Pro Forma Condensed Combined Financial Information | ' | ||||||||||||||||
The following table presents the pro forma condensed combined financial information (in thousands, except per share amounts): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Revenue | $ | 54,446 | $ | 33,308 | $ | 143,738 | $ | 86,692 | |||||||||
Net income (loss) | $ | (1,604 | ) | $ | 1,984 | $ | (16,836 | ) | $ | 4,340 | |||||||
Net income (loss) per share - basic | $ | (0.04 | ) | $ | 0.07 | $ | (0.48 | ) | $ | 0.15 | |||||||
Net income (loss) per share - diluted | $ | (0.04 | ) | $ | 0.06 | $ | (0.48 | ) | $ | 0.14 | |||||||
Goodwill_Tables
Goodwill (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||
Change in Goodwill | ' | ||||
The following table presents the change in goodwill from December 31, 2012 through September 30, 2013 (in thousands): | |||||
Balance as of December 31, 2012 | $ | 54,284 | |||
Goodwill recorded in connection with the acquisition of StreetEasy | 38,915 | ||||
Balance as of September 30, 2013 | $ | 93,199 | |||
Intangible_Assets_Net_Tables
Intangible Assets, Net (Tables) | 9 Months Ended | ||||||||||||
Sep. 30, 2013 | |||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||
Intangible Assets | ' | ||||||||||||
The following tables present the detail of intangible assets subject to amortization as of the dates presented (in thousands): | |||||||||||||
September 30, 2013 | |||||||||||||
Cost | Accumulated | Net | |||||||||||
Amortization | |||||||||||||
Developed technology | $ | 18,835 | $ | (3,559 | ) | $ | 15,276 | ||||||
Purchased content | 11,673 | (8,004 | ) | 3,669 | |||||||||
Customer relationships | 9,775 | (1,282 | ) | 8,493 | |||||||||
Trademarks | 3,261 | (437 | ) | 2,824 | |||||||||
Total | $ | 43,544 | $ | (13,282 | ) | $ | 30,262 | ||||||
December 31, 2012 | |||||||||||||
Cost | Accumulated | Net | |||||||||||
Amortization | |||||||||||||
Developed technology | $ | 14,335 | $ | (1,534 | ) | $ | 12,801 | ||||||
Purchased content | 9,044 | (6,015 | ) | 3,029 | |||||||||
Customer relationships | 4,875 | (387 | ) | 4,488 | |||||||||
Trademarks | 1,061 | (131 | ) | 930 | |||||||||
Total | $ | 29,315 | $ | (8,067 | ) | $ | 21,248 | ||||||
Estimated Future Amortization Expense for Intangible Assets | ' | ||||||||||||
Estimated future amortization expense for intangible assets, including amortization related to future commitments, as of September 30, 2013 is as follows (in thousands): | |||||||||||||
Remainder of 2013 | $ | 2,750 | |||||||||||
2014 | 10,908 | ||||||||||||
2015 | 10,671 | ||||||||||||
2016 | 9,530 | ||||||||||||
2017 | 5,906 | ||||||||||||
All future years | 4,915 | ||||||||||||
Total future estimated amortization expense | $ | 44,680 | |||||||||||
ShareBased_Awards_Tables
Share-Based Awards (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||||
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ||||||||||||||||||||
Summary of Stock Option Activity | ' | ||||||||||||||||||||
The following table summarizes stock option activity for the year ended December 31, 2012 and the nine months ended September 30, 2013: | |||||||||||||||||||||
Shares | Number | Weighted- | Weighted- | Aggregate | |||||||||||||||||
Available | of Shares | Average | Average | Intrinsic | |||||||||||||||||
for Grant | Subject to | Exercise | Remaining | Value | |||||||||||||||||
Existing | Price Per | Contractual | |||||||||||||||||||
Options | Share | Life (Years) | |||||||||||||||||||
Outstanding at January 1, 2012 | 979,024 | 5,361,256 | $ | 6.23 | 4.51 | $ | 89,749,207 | ||||||||||||||
Authorized increase in plan shares | 1,068,374 | — | — | ||||||||||||||||||
Granted | (1,884,079 | ) | 1,884,079 | 30.01 | |||||||||||||||||
Exercised | — | (1,624,304 | ) | 4.59 | |||||||||||||||||
Forfeited or cancelled | 158,359 | (158,359 | ) | 21.42 | |||||||||||||||||
Outstanding at December 31, 2012 | 321,678 | 5,462,672 | 14.48 | 4.88 | 78,912,364 | ||||||||||||||||
Authorized increase in plan shares | 2,887,064 | — | — | ||||||||||||||||||
Granted | (1,910,112 | ) | 1,910,112 | 42.08 | |||||||||||||||||
Exercised | — | (1,897,086 | ) | 8.73 | |||||||||||||||||
Forfeited or cancelled | 233,287 | (233,287 | ) | 30.34 | |||||||||||||||||
Outstanding at September 30, 2013 | 1,531,917 | 5,242,411 | 25.91 | 5.58 | 307,130,888 | ||||||||||||||||
Vested and exercisable at September 30, 2013 | 1,370,030 | 10.73 | 3.86 | 100,793,939 | |||||||||||||||||
Fair Value of Options Granted, Excluding Non Employee Director Awards, Estimated at Date of Grant Using Black Scholes Merton Option Pricing Model | ' | ||||||||||||||||||||
The fair value of options granted, excluding Nonemployee Director Awards described below and certain options granted to the Company’s chief executive officer in December 2012 and January 2013, is estimated at the date of grant using the Black-Scholes-Merton option-pricing model, assuming no dividends and with the following assumptions for the periods presented: | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Expected volatility | 54% | 49% | 50% - 54% | 49% - 52% | |||||||||||||||||
Expected dividend yields | — | — | — | — | |||||||||||||||||
Risk-free interest rate | 1.19% - 1.41% | 0.52% - 0.54% | 0.59% - 1.41% | 0.52% - 0.91% | |||||||||||||||||
Weighted-average expected life | 4.58 years | 4.58 years | 4.58 years | 4.58 years | |||||||||||||||||
Weighted-average fair value of options granted | $38.14 | $16.21 | $20.23 | $14.66 | |||||||||||||||||
Summary of Restricted Stock Award Activity | ' | ||||||||||||||||||||
The following table summarizes restricted stock award activity for the year ended December 31, 2012 and the nine months ended September 30, 2013: | |||||||||||||||||||||
Shares of | Weighted- | ||||||||||||||||||||
Restricted | Average Grant- | ||||||||||||||||||||
Stock | Date Fair | ||||||||||||||||||||
Value | |||||||||||||||||||||
Unvested outstanding at January 1, 2012 | 75,000 | $ | 29.69 | ||||||||||||||||||
Granted | 299,213 | 30.43 | |||||||||||||||||||
Vested | (34,110 | ) | 29.41 | ||||||||||||||||||
Forfeited or cancelled | — | — | |||||||||||||||||||
Unvested outstanding at December 31, 2012 | 340,103 | 30.34 | |||||||||||||||||||
Granted | 3,673 | 44.66 | |||||||||||||||||||
Vested | (22,423 | ) | 32.14 | ||||||||||||||||||
Forfeited or cancelled | (6,540 | ) | 26.28 | ||||||||||||||||||
Unvested outstanding at September 30, 2013 | 314,813 | 31.31 | |||||||||||||||||||
Summary of Restricted Stock Units Activity | ' | ||||||||||||||||||||
The following table summarizes activity for restricted stock units for the year ended December 31, 2012 and the nine months ended September 30, 2013: | |||||||||||||||||||||
Restricted Stock | Weighted- | ||||||||||||||||||||
Units | Average Grant- | ||||||||||||||||||||
Date Fair | |||||||||||||||||||||
Value | |||||||||||||||||||||
Unvested outstanding at January 1, 2012 | — | $ | — | ||||||||||||||||||
Granted | 300,961 | 38.77 | |||||||||||||||||||
Vested | — | — | |||||||||||||||||||
Forfeited or cancelled | (4,957 | ) | 39.69 | ||||||||||||||||||
Unvested outstanding at December 31, 2012 | 296,004 | 38.76 | |||||||||||||||||||
Granted | 30,875 | 83.74 | |||||||||||||||||||
Vested | (234,002 | ) | 39.69 | ||||||||||||||||||
Forfeited or cancelled | (8,590 | ) | 39.69 | ||||||||||||||||||
Unvested outstanding at September 30, 2013 | 84,287 | 55.83 | |||||||||||||||||||
Effects of Share Based Compensation in Statements of Operations | ' | ||||||||||||||||||||
The following table presents the effects of share-based compensation in our statements of operations during the periods presented (in thousands): | |||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||||||
Cost of revenue | $ | 185 | $ | 94 | $ | 524 | $ | 271 | |||||||||||||
Sales and marketing | 871 | 870 | 9,875 | 1,349 | |||||||||||||||||
Technology and development | 985 | 374 | 3,053 | 1,182 | |||||||||||||||||
General and administrative | 1,727 | 374 | 4,929 | 1,553 | |||||||||||||||||
Total | $ | 3,768 | $ | 1,712 | $ | 18,381 | $ | 4,355 | |||||||||||||
Net_Income_Loss_Per_Share_Tabl
Net Income (Loss) Per Share (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Earnings Per Share [Abstract] | ' | ||||||||||||||||
Dilutive Securities Included in Computation of Earnings Per Share | ' | ||||||||||||||||
For the periods presented, the following Class A common stock equivalents were included in the computation of diluted net income per share because they had a dilutive impact (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Class A common stock issuable upon the exercise of stock options | — | 2,142 | — | 2,324 | |||||||||||||
Class A common stock underlying unvested restricted stock awards | — | 44 | — | 54 | |||||||||||||
Class A common stock underlying unvested restricted stock units | — | 4 | — | — | |||||||||||||
Total Class A common stock equivalents | — | 2,190 | — | 2,378 | |||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ' | ||||||||||||||||
For the periods presented, the following Class A common stock equivalents were excluded from the calculations of diluted net loss per share because their effects would have been antidilutive (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Class A common stock issuable upon the exercise of stock options | 3,402 | — | 3,190 | — | |||||||||||||
Class A common stock underlying unvested restricted stock awards | 105 | — | 91 | — | |||||||||||||
Class A common stock underlying unvested restricted stock units | 36 | — | 90 | — | |||||||||||||
Total Class A common stock equivalents | 3,543 | — | 3,371 | — | |||||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 9 Months Ended | ||||
Sep. 30, 2013 | |||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||
Future Minimum Payments for All Operating Leases | ' | ||||
Future minimum payments for all operating leases as of September 30, 2013 are as follows (in thousands): | |||||
Remainder of 2013 | $ | 1,100 | |||
2014 | 5,811 | ||||
2015 | 7,005 | ||||
2016 | 7,368 | ||||
2017 | 7,446 | ||||
All future years | 31,328 | ||||
Total future minimum lease payments | $ | 60,058 | |||
Purchase Commitments for Content Related to Mobile Applications and Websites | ' | ||||
The amounts due for this content as of September 30, 2013 are as follows (in thousands): | |||||
Remainder of 2013 | $ | 1,021 | |||
2014 | 4,157 | ||||
2015 | 4,291 | ||||
2016 | 3,435 | ||||
2017 | 817 | ||||
Total future purchase commitments | $ | 13,721 | |||
Segment_Information_and_Revenu1
Segment Information and Revenue (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Revenue Categories | ' | ||||||||||||||||
The chief executive officer reviews information about revenue categories, including marketplace revenue and display revenue. The following table presents our revenue categories during the periods presented (in thousands): | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
Marketplace revenue: | |||||||||||||||||
Real estate | $ | 35,136 | $ | 21,002 | $ | 91,882 | $ | 52,232 | |||||||||
Mortgages | 5,742 | 2,614 | 16,465 | 7,600 | |||||||||||||
Total Marketplace revenue | 40,878 | 23,616 | 108,347 | 59,832 | |||||||||||||
Display revenue | 12,433 | 8,299 | 30,850 | 22,681 | |||||||||||||
Total revenue | $ | 53,311 | $ | 31,915 | $ | 139,197 | $ | 82,513 | |||||||||
Fair_Value_Measurements_Additi
Fair Value Measurements - Additional Information (Detail) (USD $) | 9 Months Ended | ||||
Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | |
Mature in 2014 | Mature in 2015 | Fair Value, Inputs, Level 3 | Fair Value, Inputs, Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' |
Original maturities date of money market funds | 'Less than three months | ' | ' | ' | ' |
Investment classification | 'Investments with maturities greater than three months but less than one year are classified as short-term investments. Investments with maturities greater than one year are classified as long-term investments. | ' | ' | ' | ' |
Investment Maturity, Percentage | ' | 0.44% | 0.56% | ' | ' |
Investment Maturity, Year | ' | '2014 | '2015 | ' | ' |
Assets measured at fair value on recurring basis | ' | ' | ' | $0 | $0 |
Liabilities measured at fair value on recurring basis | ' | ' | ' | $0 | $0 |
Fair_Value_Measurement_of_Asse
Fair Value Measurement of Assets on Recurring Basis (Detail) (Fair Value, Measurements, Recurring, USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Total | $406,964 | $196,689 |
Money Market Funds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | 301,279 | 143,246 |
U.S government agency securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 14,823 | 26,085 |
Long-term investments | 11,348 | 7,079 |
Commercial Paper | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 3,995 | 16,965 |
Corporate Notes and Bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 27,335 | 1,004 |
Long-term investments | 48,184 | 2,310 |
Fair Value, Inputs, Level 1 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Total | 327,450 | 176,410 |
Fair Value, Inputs, Level 1 | Money Market Funds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | 301,279 | 143,246 |
Fair Value, Inputs, Level 1 | U.S government agency securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 14,823 | 26,085 |
Long-term investments | 11,348 | 7,079 |
Fair Value, Inputs, Level 1 | Commercial Paper | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Fair Value, Inputs, Level 1 | Corporate Notes and Bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Long-term investments | ' | ' |
Fair Value, Inputs, Level 2 | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Total | 79,514 | 20,279 |
Fair Value, Inputs, Level 2 | Money Market Funds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Cash equivalents | ' | ' |
Fair Value, Inputs, Level 2 | U.S government agency securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | ' | ' |
Long-term investments | ' | ' |
Fair Value, Inputs, Level 2 | Commercial Paper | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 3,995 | 16,965 |
Fair Value, Inputs, Level 2 | Corporate Notes and Bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Short-term investments | 27,335 | 1,004 |
Long-term investments | $48,184 | $2,310 |
Detail_of_Property_and_Equipme
Detail of Property and Equipment (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | $65,295 | $49,147 |
Less: accumulated amortization and depreciation | -42,767 | -35,513 |
Property and equipment, net | 22,528 | 13,634 |
Website Development Costs | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 44,334 | 33,448 |
Computer Equipment | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 8,095 | 8,380 |
Leasehold Improvements | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 2,328 | 831 |
Software and Software Development Costs [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 1,724 | 1,209 |
Construction in Progress | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | 5,220 | 3,093 |
Office Equipment, Furniture and Fixtures | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property and equipment | $3,594 | $2,186 |
Property_and_Equipment_Net_Add
Property and Equipment, Net - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Depreciation and amortization expense related to property and equipment other than website development costs | $800,000 | $400,000 | $2,000,000 | $1,100,000 |
Capitalization of website development costs | 5,100,000 | 3,500,000 | 13,200,000 | 8,900,000 |
Amortization expense for website development costs included in technology and development expenses | 5,092,000 | 3,198,000 | 13,792,000 | 7,576,000 |
Technology and Development | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Amortization expense for website development costs included in technology and development expenses | 1,900,000 | 1,400,000 | 5,200,000 | 3,000,000 |
Technology and Development | Website Development Costs | ' | ' | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' | ' | ' |
Amortization expense for website development costs included in technology and development expenses | $3,200,000 | $1,800,000 | $8,600,000 | $4,600,000 |
Acquisition_Additional_Informa
Acquisition - Additional Information (Detail) (USD $) | Sep. 30, 2013 | Sep. 30, 2013 | Aug. 26, 2013 |
Maximum | StreetEasy, Inc. | ||
Business Acquisition [Line Items] | ' | ' | ' |
Cash paid for outstanding stock | ' | ' | $42,688,000 |
Consideration deposited in escrow | ' | ' | 5,000,000 |
Accrued expenses and other current liabilities in connection with acquisition | 5,600,000 | ' | ' |
Prepaid expenses and other current assets | 700,000 | ' | 227,000 |
Total purchase price | ' | ' | $48,031,000 |
Estimates and assumptions related to the purchase price allocation | ' | '1 year | ' |
Summary_of_Purchase_Price_Deta
Summary of Purchase Price (Detail) (StreetEasy, Inc., USD $) | Aug. 26, 2013 |
In Thousands, unless otherwise specified | |
StreetEasy, Inc. | ' |
Business Acquisition [Line Items] | ' |
Cash payable for the outstanding stock of StreetEasy | $42,688 |
Cash payable for the cancellation of vested options to purchase shares of StreetEasy's common stock | 2,989 |
Certain transaction expenses and other costs incurred by StreetEasy | 1,924 |
Substituted unvested stock options attributable to pre-combination service | 430 |
Total purchase price | $48,031 |
Identifiable_Intangible_Assets
Identifiable Intangible Assets Acquired (Detail) (USD $) | 1 Months Ended |
In Thousands, unless otherwise specified | Aug. 26, 2013 |
Finite-Lived Intangible Assets [Line Items] | ' |
Intangible assets acquired | $11,600 |
StreetEasy, Inc. | Developed Technology | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Intangible assets acquired | 4,500 |
Estimated Amortization Period (in years) | '5 years |
StreetEasy, Inc. | Customer Relationships | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Intangible assets acquired | 4,900 |
Estimated Amortization Period (in years) | '5 years |
StreetEasy, Inc. | Trademarks | ' |
Finite-Lived Intangible Assets [Line Items] | ' |
Intangible assets acquired | $2,200 |
Estimated Amortization Period (in years) | '5 years |
Purchase_Price_Allocation_Deta
Purchase Price Allocation (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 | Aug. 26, 2013 |
In Thousands, unless otherwise specified | StreetEasy, Inc. | ||
Business Acquisition [Line Items] | ' | ' | ' |
Accounts receivable | ' | ' | $971 |
Prepaid expenses and other current assets | 700 | ' | 227 |
Property and equipment | ' | ' | 1,138 |
Other identifiable tangible assets | ' | ' | 144 |
Total tangible assets | ' | ' | 2,480 |
Accounts payable | ' | ' | -107 |
Accrued expenses and other current liabilities | ' | ' | -194 |
Accrued compensation and benefits | ' | ' | -224 |
Other identifiable liabilities | ' | ' | -174 |
Net deferred tax liability | ' | ' | -4,265 |
Total liabilities | ' | ' | -4,964 |
Net acquired liabilities | ' | ' | -2,484 |
Identifiable intangible assets | ' | ' | 11,600 |
Goodwill | 93,199 | 54,284 | 38,915 |
Total purchase price | ' | ' | $48,031 |
Pro_Forma_Condensed_Combined_F
Pro Forma Condensed Combined Financial Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Business Combinations [Abstract] | ' | ' | ' | ' |
Revenue | $54,446 | $33,308 | $143,738 | $86,692 |
Net income (loss) | ($1,604) | $1,984 | ($16,836) | $4,340 |
Net income (loss) per share-basic | ($0.04) | $0.07 | ($0.48) | $0.15 |
Net income (loss) per share-diluted | ($0.04) | $0.06 | ($0.48) | $0.14 |
Change_in_Goodwill_Detail
Change in Goodwill (Detail) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Goodwill And Intangible Assets Disclosure [Abstract] | ' |
Balance as of December 31, 2012 | $54,284 |
Goodwill recorded in connection with the acquisition of StreetEasy | 38,915 |
Balance as of September 30, 2013 | $93,199 |
Intangible_Assets_Detail
Intangible Assets (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Cost | $43,544 | $29,315 |
Accumulated Amortization | -13,282 | -8,067 |
Net | 30,262 | 21,248 |
Developed Technology | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Cost | 18,835 | 14,335 |
Accumulated Amortization | -3,559 | -1,534 |
Net | 15,276 | 12,801 |
Purchased Content | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Cost | 11,673 | 9,044 |
Accumulated Amortization | -8,004 | -6,015 |
Net | 3,669 | 3,029 |
Customer Relationships | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Cost | 9,775 | 4,875 |
Accumulated Amortization | -1,282 | -387 |
Net | 8,493 | 4,488 |
Trademarks | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Cost | 3,261 | 1,061 |
Accumulated Amortization | -437 | -131 |
Net | $2,824 | $930 |
Intangible_Assets_Net_Addition
Intangible Assets, Net - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' |
Amortization of website development costs and intangible assets | $5,092 | $3,198 | $13,792 | $7,576 |
Technology and Development | ' | ' | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' | ' | ' |
Amortization of website development costs and intangible assets | $1,900 | $1,400 | $5,200 | $3,000 |
Estimated_Future_Amortization_
Estimated Future Amortization Expense for Intangible Assets (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Goodwill And Intangible Assets Disclosure [Abstract] | ' |
Remainder of 2013 | $2,750 |
2014 | 10,908 |
2015 | 10,671 |
2016 | 9,530 |
2017 | 5,906 |
All future years | 4,915 |
Total future estimated amortization expense | $44,680 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Minimum estimated percentage of deferred tax unrealized | ' | 50.00% | ' |
Net operating loss carryforwards | ' | ' | $115,700,000 |
Income tax benefit | $4,265,000 | $4,265,000 | ' |
Shareholders_Equity_Additional
Shareholders' Equity - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
In Millions, except Share data, unless otherwise specified | Aug. 31, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Number of common stock converted | ' | ' | 600,000 | 973,634 | 2,065,787 |
Net proceeds from issuance of common stock | $253.90 | $156.70 | ' | ' | ' |
Class A Common Stock | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Common stock holders voting right | ' | ' | ' | 1 | ' |
Conversion of common stock conversion ratio | ' | ' | ' | ' | 1 |
Issuance of Class A common stock, shares | 3,253,522 | 3,844,818 | ' | ' | ' |
Class A Common Stock | Underwriters | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Issuance of Class A common stock, shares | 753,522 | 419,818 | ' | ' | ' |
Class A Common Stock | Private Placement | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Issuance of Class A common stock, shares | 2,523,486 | 575,000 | ' | ' | ' |
Class A common stock at an offering Price | $82 | $43 | ' | ' | ' |
Class B Common Stock | ' | ' | ' | ' | ' |
Class of Stock [Line Items] | ' | ' | ' | ' | ' |
Common stock holders voting right | ' | ' | ' | ' | 10 |
ShareBased_Awards_Additional_I
Share-Based Awards - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | 12 Months Ended | 1 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Apr. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | 31-May-13 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Apr. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | |
HotPads, Inc. | Restricted Stock | Restricted Stock | Restricted Stock | Restricted Stock Units | Restricted Stock Units | Restricted Stock Units | Restricted Stock Units | Restricted Stock Units | Restricted Stock Units | Non Employee Director Rewards | Non Employee Director Rewards | Non Employee Director Rewards | Stock Options | Stock Options | |||||||
2011 Plan | Class A Common Stock | Former Employee | 2011 Plan | ||||||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in number of authorized shares available for awards | ' | ' | ' | ' | ' | 1,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Substituted incentive stock options granted in connection with acquisition | ' | ' | ' | ' | ' | ' | 15,143 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Exercise price per share fixed | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share based compensation arrangement by share based payment, award minimum exercisable period | ' | '3 months | ' | '3 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Share based compensation arrangement by share based payment, award maximum exercisable period | ' | '12 months | ' | '12 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Term of Award from date of grant | ' | ' | ' | '10 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of Vested Restricted Stock Unit | ' | ' | ' | 25.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Options granted to date under various plan | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 'One twelfth of each restricted stock unit award will vest on each one-month anniversary of the vesting commencement date of September 20, 2013, subject to the recipientbs continued full-time employment or service to Zillow. In the event of termination of service during the first six months of employment by Zillow without cause or upon the resignation by such employee for good reason, 13,000 of the restricted stock units, less the number of restricted stock units that already vested prior to termination, will become vested units, and such employee will be entitled to receive one share of Zillowbs Class A common stock for each then outstanding unit. | ' | ' | ' | ' | ' | ' | ' | ' | 'Options granted under the 2011 Plan are typically granted with seven-year terms and typically vest 25% after 12 months and ratably thereafter over the next 36 months, | ' |
Number of restricted stock excluded | ' | ' | ' | ' | ' | ' | ' | 3,673 | 299,213 | 139,000 | ' | 30,875 | 300,961 | 26,000 | ' | 84,287 | ' | ' | ' | ' | ' |
Stock option of Class A common stock granted | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30,690 | ' | 1,910,112 | 1,884,079 |
Fair value of options granted | ' | $38.14 | $16.21 | $20.23 | $14.66 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $16.29 | ' | ' | ' |
Expected volatility | ' | 54.00% | 49.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 51.00% | ' | ' | ' |
Risk-free interest rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0.36% | ' | ' | ' |
Weighted-average expected life | ' | '4 years 6 months 29 days | '4 years 6 months 29 days | '4 years 6 months 29 days | '4 years 6 months 29 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '3 years 6 months | ' | ' | ' |
Recognized compensation cost | ' | $3,768,000 | $1,712,000 | $18,381,000 | $4,355,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $0 | ' | $500,000 | ' | ' |
Total unrecognized compensation cost | ' | ' | ' | ' | ' | ' | ' | 7,800,000 | ' | ' | 4,300,000 | 4,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of restricted stock units to be vested | ' | ' | ' | ' | ' | ' | ' | 22,423 | 34,110 | ' | ' | 234,002 | ' | ' | 218,071 | ' | ' | ' | ' | ' | ' |
Terms of restricted stock unit award | 'The former employee is entitled to receive one share of Zillow's Class A common stock for each outstanding restricted stock unit. | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recognized share-based compensation expense | ' | ' | ' | 7,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Restricted stock unit stock conversion ratio | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Fair value of restricted shares issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $2,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Summary_of_Stock_Option_Activi
Summary of Stock Option Activity (Detail) (Stock Options, USD $) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Stock Options | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' |
Shares Available for Grant, Beginning Balance | 321,678 | 979,024 | ' |
Shares Available for Grant, Authorized increase in plan shares | 2,887,064 | 1,068,374 | ' |
Shares Available for Grant, Granted | -1,910,112 | -1,884,079 | ' |
Shares Available for Grant, Exercised | ' | ' | ' |
Shares Available for Grant, Forfeited or cancelled | 233,287 | 158,359 | ' |
Shares Available for Grant, Ending Balance | 1,531,917 | 321,678 | 979,024 |
Number of Shares Subject to Existing Options, Beginning Balance | 5,462,672 | 5,361,256 | ' |
Number of Shares Subject to Existing Options, Authorized increase in plan shares | ' | ' | ' |
Number of Shares Subject to Existing Options, Granted | 1,910,112 | 1,884,079 | ' |
Number of Shares Subject to Existing Options, Exercised | -1,897,086 | -1,624,304 | ' |
Number of Shares Subject to Existing Options, Forfeited or cancelled | -233,287 | -158,359 | ' |
Number of Shares Subject to Existing Options, Ending Balance | 5,242,411 | 5,462,672 | 5,361,256 |
Weighted-Average Exercise Price Per Share, Beginning Balance | $14.48 | $6.23 | ' |
Number of Shares Subject to Existing Options, Vested and exercisable | 1,370,030 | ' | ' |
Weighted-Average Exercise Price Per Share, Authorized increase in plan shares | ' | ' | ' |
Weighted-Average Exercise Price Per Share, Granted | $42.08 | $30.01 | ' |
Weighted-Average Exercise Price Per Share, Exercised | $8.73 | $4.59 | ' |
Weighted-Average Exercise Price Per Share, Forfeited or cancelled | $30.34 | $21.42 | ' |
Weighted-Average Exercise Price Per Share, Ending Balance | $25.91 | $14.48 | $6.23 |
Weighted-Average Exercise Price Per Share, Vested and exercisable | $10.73 | ' | ' |
Weighted-Average Remaining Contractual Life (Years) | '5 years 6 months 29 days | '4 years 10 months 17 days | '4 years 6 months 4 days |
Weighted-Average Remaining Contractual Life (Years), Vested and exercisable | '3 years 10 months 10 days | ' | ' |
Aggregate Intrinsic Value | $307,130,888 | $78,912,364 | $89,749,207 |
Aggregate Intrinsic Value, Vested and exercisable | $100,793,939 | ' | ' |
Fair_Value_of_Options_Granted_
Fair Value of Options Granted, Excluding Non Employee Director Awards, Estimated at Date of Grant Using Black Scholes Merton Option Pricing Model (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ' | ' | ' | ' |
Expected volatility | 54.00% | 49.00% | ' | ' |
Expected volatility, minimum | ' | ' | 50.00% | 49.00% |
Expected volatility, maximum | ' | ' | 54.00% | 52.00% |
Expected dividend yields | ' | ' | ' | ' |
Risk-free interest rate, minimum | 1.19% | 0.52% | 0.59% | 0.52% |
Risk-free interest rate, maximum | 1.41% | 0.54% | 1.41% | 0.91% |
Weighted-average expected life | '4 years 6 months 29 days | '4 years 6 months 29 days | '4 years 6 months 29 days | '4 years 6 months 29 days |
Weighted-average fair value of options granted | $38.14 | $16.21 | $20.23 | $14.66 |
Summary_of_Restricted_Stock_Aw
Summary of Restricted Stock Award Activity (Detail) (Restricted Stock, USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Restricted Stock | ' | ' |
Shares of Restricted Stock | ' | ' |
Unvested outstanding, beginning balance | 340,103 | 75,000 |
Granted | 3,673 | 299,213 |
Vested | -22,423 | -34,110 |
Forfeited or cancelled | -6,540 | ' |
Unvested outstanding, ending balance | 314,813 | 340,103 |
Weighted-Average Grant-Date Fair Value | ' | ' |
Unvested outstanding, beginning balance | $30.34 | $29.69 |
Granted | $44.66 | $30.43 |
Vested | $32.14 | $29.41 |
Forfeited or cancelled | $26.28 | ' |
Unvested outstanding, ending balance | $31.31 | $30.34 |
Summary_of_Restricted_Stock_Un
Summary of Restricted Stock Units Activity (Detail) (Restricted Stock Units, USD $) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2013 | Dec. 31, 2012 | |
Restricted Stock Units | ' | ' |
Restricted Stock Units | ' | ' |
Unvested outstanding, beginning balance | 296,004 | 0 |
Granted | 30,875 | 300,961 |
Vested | -234,002 | ' |
Forfeited or cancelled | -8,590 | -4,957 |
Unvested outstanding, ending balance | 84,287 | 296,004 |
Weighted-Average Grant-Date Fair Value | ' | ' |
Unvested outstanding, beginning balance | $38.76 | $0 |
Granted | $83.74 | $38.77 |
Vested | $39.69 | ' |
Forfeited or cancelled | $39.69 | $39.69 |
Unvested outstanding, ending balance | $55.83 | $38.76 |
Effects_of_Share_Based_Compens
Effects of Share Based Compensation in Statements of Operations (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Share-based compensation | $3,768 | $1,712 | $18,381 | $4,355 |
Cost of Revenue | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Share-based compensation | 185 | 94 | 524 | 271 |
Sales and Marketing | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Share-based compensation | 871 | 870 | 9,875 | 1,349 |
Technology and Development | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Share-based compensation | 985 | 374 | 3,053 | 1,182 |
General and Administrative | ' | ' | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' | ' | ' |
Share-based compensation | $1,727 | $374 | $4,929 | $1,553 |
Dilutive_Securities_Included_i
Dilutive Securities Included in Computation of Earnings Per Share (Detail) (Class A Common Stock) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents included in the computation of diluted net income per share | ' | 2,190 | ' | 2,378 |
Stock Options | ' | ' | ' | ' |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents included in the computation of diluted net income per share | ' | 2,142 | ' | 2,324 |
Restricted Stock | ' | ' | ' | ' |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents included in the computation of diluted net income per share | ' | 44 | ' | 54 |
Restricted Stock Units | ' | ' | ' | ' |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents included in the computation of diluted net income per share | ' | 4 | ' | ' |
Antidilutive_Securities_Exclud
Antidilutive Securities Excluded from Computation of Earnings Per Share (Detail) (Class A Common Stock) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents excluded from calculations of diluted net loss per share | 3,543 | ' | 3,371 | ' |
Stock Options | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents excluded from calculations of diluted net loss per share | 3,402 | ' | 3,190 | ' |
Restricted Stock | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents excluded from calculations of diluted net loss per share | 105 | ' | 91 | ' |
Restricted Stock Units | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Class A common stock equivalents excluded from calculations of diluted net loss per share | 36 | ' | 90 | ' |
Commitments_and_Contingencies_1
Commitments and Contingencies - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||||
Nov. 30, 2010 | Dec. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Apr. 30, 2013 | Nov. 30, 2012 | Jul. 30, 2012 | Apr. 30, 2012 | Mar. 31, 2011 | Sep. 30, 2013 | Apr. 30, 2013 | Nov. 30, 2012 | Jun. 30, 2012 | Apr. 30, 2012 | Mar. 01, 2011 | |
Patent | Operating Lease | Operating Lease | Operating Lease | Operating Lease | Operating Lease | Operating Lease | |||||||||||
sqft | sqft | sqft | sqft | sqft | sqft | ||||||||||||
Property Subject to or Available for Operating Lease [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Rentable area of the premises | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,024 | 22,583 | 18,353 | 21,575 | 20,025 | 66,000 |
Rent expense | ' | ' | $1,100,000 | $700,000 | $3,300,000 | $1,800,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Non-cancelable purchase commitments for content | ' | ' | 13,721,000 | ' | 13,721,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loan and security agreement to establish a line of credit | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000,000 | 4,000,000 | ' | ' | ' | ' | ' | ' |
Outstanding letters of credit | ' | ' | ' | ' | ' | ' | $2,000,000 | $200,000 | $1,700,000 | ' | $1,500,000 | ' | ' | ' | ' | ' | ' |
Expiration date of lease | ' | '60 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of patents-in-suit | 3 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Future_Minimum_Payments_for_Al
Future Minimum Payments for All Operating Leases (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Commitments And Contingencies Disclosure [Abstract] | ' |
Remainder of 2013 | $1,100 |
2014 | 5,811 |
2015 | 7,005 |
2016 | 7,368 |
2017 | 7,446 |
All future years | 31,328 |
Total future minimum lease payments | $60,058 |
Purchase_Commitments_for_Conte
Purchase Commitments for Content Related to Mobile Applications and Websites (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Commitments And Contingencies Disclosure [Abstract] | ' |
Remainder of 2013 | $1,021 |
2014 | 4,157 |
2015 | 4,291 |
2016 | 3,435 |
2017 | 817 |
Total future purchase commitments | $13,721 |
Segment_Information_and_Revenu2
Segment Information and Revenue - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2013 | |
Segment | |
Segment Reporting [Abstract] | ' |
Number of reportable segment | 1 |
Revenue_Categories_Detail
Revenue Categories (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues: | ' | ' | ' | ' |
Total revenue | $53,311 | $31,915 | $139,197 | $82,513 |
Operating Segments | Marketplace revenue | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Total revenue | 40,878 | 23,616 | 108,347 | 59,832 |
Operating Segments | Marketplace revenue | Real Estate Revenue | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Total revenue | 35,136 | 21,002 | 91,882 | 52,232 |
Operating Segments | Marketplace revenue | Mortgages Revenue | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Total revenue | 5,742 | 2,614 | 16,465 | 7,600 |
Operating Segments | Display revenue | ' | ' | ' | ' |
Revenues: | ' | ' | ' | ' |
Total revenue | $12,433 | $8,299 | $30,850 | $22,681 |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (Restricted Stock Units, USD $) | 1 Months Ended | 9 Months Ended | 12 Months Ended | 1 Months Ended |
In Millions, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Oct. 31, 2013 |
Subsequent Events | ||||
StreetEasy, Inc. | ||||
Subsequent Event [Line Items] | ' | ' | ' | ' |
Restricted stock units of Class A common stock granted | ' | 30,875 | 300,961 | 54,929 |
Fair value of restricted shares issued | $2.30 | ' | ' | $4.40 |
Restricted stock unit, award vesting period | ' | ' | ' | '4 years |