Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2022 | Oct. 26, 2022 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-36853 | |
Entity Registrant Name | ZILLOW GROUP, INC. | |
Entity Incorporation, State or Country Code | WA | |
Entity Tax Identification Number | 47-1645716 | |
Entity Address, Address Line One | 1301 Second Avenue | |
Entity Address, Address Line Two | Floor 31 | |
Entity Address, City or Town | Seattle | |
Entity Address, State or Province | WA | |
Entity Address, Postal Zip Code | 98101 | |
City Area Code | 206 | |
Local Phone Number | 470-7000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001617640 | |
Current Fiscal Year End Date | --12-31 | |
Class A common stock | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Class A Common Stock, par value $0.0001 per share | |
Trading Symbol | ZG | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 58,197,059 | |
Class B Common Stock | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 6,217,447 | |
Class C capital stock | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Class C Capital Stock, par value $0.0001 per share | |
Trading Symbol | Z | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 173,312,042 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 1,973 | $ 2,315 |
Short-term investments | 1,516 | 514 |
Accounts receivable, net of allowance for doubtful accounts of $4 and $4, respectively | 78 | 77 |
Mortgage loans held for sale | 49 | 107 |
Prepaid expenses and other current assets | 153 | 140 |
Restricted cash | 2 | 1 |
Current assets of discontinued operations | 0 | 4,526 |
Total current assets | 3,771 | 7,680 |
Contract cost assets | 25 | 35 |
Property and equipment, net | 261 | 215 |
Right of use assets | 127 | 130 |
Goodwill | 2,374 | 2,374 |
Intangible assets, net | 149 | 176 |
Other assets | 11 | 3 |
Noncurrent assets of discontinued operations | 0 | 82 |
Total assets | 6,718 | 10,695 |
Current liabilities: | ||
Accounts payable | 19 | 11 |
Accrued expenses and other current liabilities | 112 | 89 |
Accrued compensation and benefits | 56 | 61 |
Borrowings under credit facilities | 45 | 113 |
Deferred revenue | 50 | 51 |
Lease liabilities, current portion | 30 | 24 |
Current liabilities of discontinued operations | 0 | 3,533 |
Total current liabilities | 312 | 3,882 |
Lease liabilities, net of current portion | 141 | 148 |
Convertible senior notes | 1,659 | 1,319 |
Other long-term liabilities | 11 | 5 |
Total liabilities | 2,123 | 5,354 |
Commitments and contingencies (Note 16) | ||
Shareholders’ equity: | ||
Preferred stock, $0.0001 par value; authorized — 30,000,000 shares; no shares issued and outstanding | 0 | 0 |
Additional paid-in capital | 6,154 | 7,001 |
Accumulated other comprehensive income (loss) | (19) | 7 |
Accumulated deficit | (1,540) | (1,667) |
Total shareholders’ equity | 4,595 | 5,341 |
Total liabilities and shareholders’ equity | 6,718 | 10,695 |
Class A common stock | ||
Shareholders’ equity: | ||
Common stock/capital stock | 0 | 0 |
Class B Common Stock | ||
Shareholders’ equity: | ||
Common stock/capital stock | 0 | 0 |
Class C capital stock | ||
Shareholders’ equity: | ||
Common stock/capital stock | $ 0 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Allowance for doubtful accounts | $ 4 | $ 4 |
Preferred stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized (in shares) | 30,000,000 | 30,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Class A common stock | ||
Common stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized (in shares) | 1,245,000,000 | 1,245,000,000 |
Common stock, issued (in shares) | 58,197,059 | 61,513,634 |
Common stock, outstanding (in shares) | 58,197,059 | 61,513,634 |
Class B Common Stock | ||
Common stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized (in shares) | 15,000,000 | 15,000,000 |
Common stock, issued (in shares) | 6,217,447 | 6,217,447 |
Common stock, outstanding (in shares) | 6,217,447 | 6,217,447 |
Class C capital stock | ||
Common stock, par value (usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized (in shares) | 600,000,000 | 600,000,000 |
Common stock, issued (in shares) | 173,279,780 | 182,898,987 |
Common stock, outstanding (in shares) | 173,279,780 | 182,898,987 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenue | $ 483 | $ 550 | $ 1,523 | $ 1,597 |
Cost of revenue | 89 | 82 | 278 | 228 |
Gross profit | 394 | 468 | 1,245 | 1,369 |
Operating expenses: | ||||
Sales and marketing | 165 | 205 | 502 | 532 |
Technology and development | 142 | 101 | 369 | 319 |
General and administrative | 138 | 104 | 370 | 303 |
Restructuring costs | 0 | 0 | 14 | 0 |
Acquisition-related costs | 0 | 3 | 0 | 8 |
Total operating expenses | 445 | 413 | 1,255 | 1,162 |
Income (loss) from continuing operations | (51) | 55 | (10) | 207 |
Loss on extinguishment of debt | 0 | (15) | 0 | (17) |
Other income, net | 12 | 2 | 19 | 5 |
Interest expense | (9) | (29) | (26) | (99) |
Income (loss) from continuing operations before income taxes | (48) | 13 | (17) | 96 |
Income tax benefit (expense) | (3) | 5 | 1 | 0 |
Net income (loss) from continuing operations | (51) | 18 | (16) | 96 |
Net loss from discontinued operations, net of income taxes | (2) | (347) | (13) | (363) |
Net loss | $ (53) | $ (329) | $ (29) | $ (267) |
Net income (loss) from continuing operations per share: | ||||
Basic (USD per share) | $ (0.21) | $ 0.07 | $ (0.07) | $ 0.39 |
Diluted (usd per share) | (0.21) | 0.07 | (0.07) | 0.37 |
Net loss per share: | ||||
Basic (usd per share) | (0.22) | (1.29) | (0.12) | (1.07) |
Diluted (usd per share) | $ (0.22) | $ (1.24) | $ (0.12) | $ (1.02) |
Weighted-average shares outstanding: | ||||
Basic (in shares) | 240,080 | 254,074 | 244,157 | 248,564 |
Diluted (in shares) | 240,080 | 265,112 | 244,157 | 262,043 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (53) | $ (329) | $ (29) | $ (267) |
Other comprehensive loss: | ||||
Unrealized losses on investments | (6) | 0 | (26) | 0 |
Total other comprehensive loss | (6) | 0 | (26) | 0 |
Comprehensive loss | $ (59) | $ (329) | $ (55) | $ (267) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Shareholders' Equity - USD ($) $ in Millions | Total | Cumulative-effect adjustment from adoption of guidance on accounting for convertible instruments and contracts in an entity’s own equity | Class A Common Stock, Class B Common Stock and Class C Capital Stock | Additional Paid-In Capital | Additional Paid-In Capital Cumulative-effect adjustment from adoption of guidance on accounting for convertible instruments and contracts in an entity’s own equity | Accumulated Deficit | Accumulated Deficit Cumulative-effect adjustment from adoption of guidance on accounting for convertible instruments and contracts in an entity’s own equity | Accumulated Other Comprehensive Loss |
Beginning Balance at Dec. 31, 2020 | $ 4,742 | $ 0 | $ 5,881 | $ (1,139) | $ 0 | |||
Beginning Balance (in shares) at Dec. 31, 2020 | 240,526,000 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common and capital stock upon exercise of stock options | 98 | 98 | ||||||
Issuance of common and capital stock upon exercise of stock options (in shares) | 2,524,000 | |||||||
Vesting of restricted stock units (in shares) | 2,305,000 | |||||||
Restricted stock units withheld for tax liability (in shares) | (1,000) | |||||||
Share-based compensation expense | 250 | 250 | ||||||
Issuance of Class C capital stock in connection with equity offering, net of issuance costs | 545 | 545 | ||||||
Issuance of Class C capital stock in connection with equity offering, net of issuance costs (in shares) | 3,164,000 | |||||||
Settlement of convertible senior notes | 403 | 403 | ||||||
Settlement of convertible senior notes (in shares) | 6,265,000 | |||||||
Net loss | (267) | (267) | ||||||
Other comprehensive loss | 0 | |||||||
Ending Balance at Sep. 30, 2021 | 5,771 | $ 0 | 7,177 | (1,406) | 0 | |||
Ending Balance (in shares) at Sep. 30, 2021 | 254,782,000 | |||||||
Beginning Balance at Jun. 30, 2021 | 5,644 | $ 0 | 6,721 | (1,077) | 0 | |||
Beginning Balance (in shares) at Jun. 30, 2021 | 248,863,000 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common and capital stock upon exercise of stock options | 22 | 22 | ||||||
Issuance of common and capital stock upon exercise of stock options (in shares) | 533,000 | |||||||
Vesting of restricted stock units (in shares) | 712,000 | |||||||
Share-based compensation expense | 90 | 90 | ||||||
Settlement of convertible senior notes | 344 | 344 | ||||||
Settlement of convertible senior notes (in shares) | 4,675,000 | |||||||
Net loss | (329) | (329) | ||||||
Other comprehensive loss | 0 | |||||||
Ending Balance at Sep. 30, 2021 | 5,771 | $ 0 | 7,177 | (1,406) | 0 | |||
Ending Balance (in shares) at Sep. 30, 2021 | 254,782,000 | |||||||
Beginning Balance at Dec. 31, 2021 | 5,341 | $ (336) | $ 0 | 7,001 | $ (492) | (1,667) | $ 156 | 7 |
Beginning Balance (in shares) at Dec. 31, 2021 | 250,630,000 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common and capital stock upon exercise of stock options | $ 44 | |||||||
Issuance of common and capital stock upon exercise of stock options (in shares) | 1,078,000 | 1,078,000 | ||||||
Vesting of restricted stock units (in shares) | 3,278,000 | |||||||
Share-based compensation expense | $ 374 | 374 | ||||||
Repurchases of Class A common stock and Class C capital stock | (773) | (773) | ||||||
Repurchase of Class A common stock and class c capital stock (in shares) | (17,292,000) | |||||||
Net loss | (29) | $ (29) | ||||||
Other comprehensive loss | (26) | (26) | ||||||
Ending Balance at Sep. 30, 2022 | 4,595 | $ 0 | 6,154 | (1,540) | (19) | |||
Ending Balance (in shares) at Sep. 30, 2022 | 237,694,000 | |||||||
Beginning Balance at Jun. 30, 2022 | 4,667 | $ 0 | 6,167 | (1,487) | (13) | |||
Beginning Balance (in shares) at Jun. 30, 2022 | 241,141,000 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Issuance of common and capital stock upon exercise of stock options | 2 | 2 | ||||||
Issuance of common and capital stock upon exercise of stock options (in shares) | 83,000 | |||||||
Vesting of restricted stock units (in shares) | 1,467,000 | |||||||
Share-based compensation expense | 161 | 161 | ||||||
Repurchases of Class A common stock and Class C capital stock | (176) | (176) | ||||||
Repurchase of Class A common stock and class c capital stock (in shares) | (4,997,000) | |||||||
Net loss | (53) | (53) | ||||||
Other comprehensive loss | (6) | (6) | ||||||
Ending Balance at Sep. 30, 2022 | $ 4,595 | $ 0 | $ 6,154 | $ (1,540) | $ (19) | |||
Ending Balance (in shares) at Sep. 30, 2022 | 237,694,000 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Operating activities | ||
Net loss | $ (29) | $ (267) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 121 | 88 |
Share-based compensation | 341 | 231 |
Amortization of right of use assets | 17 | 18 |
Amortization of contract cost assets | 23 | 32 |
Amortization of debt discount and debt issuance costs | 24 | 72 |
Loss on extinguishment of debt | 21 | 17 |
Inventory valuation adjustment | 9 | 304 |
Other adjustments to reconcile net loss to cash provided by (used in) operating activities | (9) | 10 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 76 | (89) |
Mortgage loans held for sale | 58 | 110 |
Inventory | 3,904 | (3,570) |
Prepaid expenses and other assets | (13) | (70) |
Contract cost assets | (13) | (22) |
Lease liabilities | (15) | (21) |
Accounts payable | 1 | 17 |
Accrued expenses and other current liabilities | (49) | 163 |
Accrued compensation and benefits | (52) | 11 |
Deferred revenue | (1) | 4 |
Other long-term liabilities | 6 | 0 |
Net cash provided by (used in) operating activities | 4,420 | (2,962) |
Investing activities | ||
Proceeds from maturities of investments | 455 | 1,696 |
Purchases of investments | (1,474) | (509) |
Purchases of property and equipment | (87) | (45) |
Purchases of intangible assets | (17) | (24) |
Cash paid for acquisition, net | 0 | (497) |
Net cash provided by (used in) investing activities | (1,123) | 621 |
Financing activities | ||
Proceeds from issuance of Class C capital stock, net of issuance costs | 0 | 545 |
Proceeds from issuance of term loan, net of issuance costs | 0 | 443 |
Proceeds from borrowings on credit facilities | 0 | 2,639 |
Repayments of borrowings on credit facilities | (2,205) | (535) |
Net repayments on warehouse line of credit and repurchase agreements | (68) | (101) |
Repurchases of Class A common stock and Class C capital stock | (773) | 0 |
Settlement of long-term debt | (1,158) | (1) |
Proceeds from exercise of stock options | 44 | 98 |
Net cash provided by (used in) financing activities | (4,160) | 3,088 |
Net increase (decrease) in cash, cash equivalents and restricted cash during period | (863) | 747 |
Cash, cash equivalents and restricted cash at beginning of period | 2,838 | 1,779 |
Cash, cash equivalents and restricted cash at end of period | 1,975 | 2,526 |
Supplemental disclosures of cash flow information | ||
Cash paid for interest | 42 | 58 |
Cash paid for taxes | 5 | 0 |
Noncash transactions: | ||
Write-off of fully amortized intangible assets | 200 | 55 |
Issuance (settlement) of beneficial interests in securitizations | (79) | 25 |
Write-off of fully depreciated property and equipment | 48 | 38 |
Capitalized share-based compensation | 33 | 19 |
Recognition (derecognition) of operating right of use assets and lease liabilities | 14 | (12) |
Property and equipment purchased on account | $ 2 | $ 2 |
Organization and Description of
Organization and Description of Business | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Organization and Description of Business | Organization and Description of Business Zillow Group is reimagining real estate to make it easier to unlock life’s next chapter. As the most visited real estate website in the United States, Zillow and its affiliates offer customers an on-demand experience for selling, buying, renting or financing with transparency and ease. Our portfolio of consumer brands includes Zillow Premier Agent, Zillow Home Loans, our affiliate lender, Zillow Closing Services, Zillow Rentals, Trulia, StreetEasy, HotPads and Out East. In addition, Zillow Group provides a comprehensive suite of marketing software and technology solutions for the real estate industry which include Mortech, New Home Feed and ShowingTime+, which houses ShowingTime, Bridge Interactive, dotloop and interactive floor plans. In the fourth quarter of 2021, we began to wind down the operations of Zillow Offers, our iBuying business which purchased and sold homes directly in markets across the country. The wind down was complete as of September 30, 2022, and we have presented the financial results of Zillow Offers as discontinued operations in our condensed consolidated financial statements for all periods presented. See Note 3 for additional information. 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: current and future health and stability of the economy, financial conditions, and housing market, and changes in general economic and financial conditions (including federal monetary policy, interest rates, inflation, home price fluctuations and housing inventory); our investment of resources to pursue strategies and develop new products and services that may not prove effective or that are not attractive for customers and real estate partners; the duration and impact of public health crises, like the COVID-19 pandemic (including variants) on our ability to operate, demand for our products or services or general economic conditions; addition or loss of a significant number of customers; our ability to successfully integrate and realize the benefits of our past or future strategic partnerships, acquisitions, business combinations or investments; our ability to manage advertising inventory or pricing; engagement and usage of our products; competition and innovation in our markets; actual or anticipated changes in technology, products, markets or services by us or our competitors; our ability to maintain or establish relationships with listings and data providers; our ability to obtain or maintain licenses and permits to support our current and future businesses; our ability to operate and grow our mortgage origination business, including the ability to obtain sufficient financing and resell originated mortgages on the secondary market; changes in laws or government regulation affecting our business; outcomes of legal proceedings; natural disasters and other catastrophic events; our ability to attract and retain qualified employees and key personnel; protection of customers’ information and other privacy concerns; protection of our brand and intellectual property; and intellectual property infringement and other claims, among other things. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements include Zillow Group, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. These condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“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 consolidated financial statements should be read in conjunction with the audited financial statements and accompanying notes included in Zillow Group, Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, which was filed with the SEC on February 10, 2022. The condensed consolidated balance sheet as of December 31, 2021, included herein, was derived from the audited financial statements of Zillow Group, Inc. as of that date, adjusted for the reclassification of discontinued operations discussed in Note 3. The unaudited condensed consolidated interim financial statements, 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, 2022 and our results of operations, comprehensive loss, and shareholders’ equity for the three and nine month periods ended September 30, 2022 and 2021, and our cash flows for the nine month periods ended September 30, 2022 and 2021. The results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results to be expected for the year ending December 31, 2022, or for any interim period, or for any other future year. Unless indicated otherwise, the information in the Notes to Condensed Consolidated Financial Statements relates to the Company’s continuing operations and does not include the results of discontinued operations. 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. On an ongoing basis, we evaluate our estimates, including those related to the accounting for certain revenue offerings, restructuring costs, amortization period and recoverability of contract cost assets, website and software development costs, recoverability of long-lived assets and intangible assets, share-based compensation, income taxes, the presentation of discontinued and continuing operations, business combinations and the recoverability of goodwill, among others. To the extent there are material differences between these estimates, judgments or assumptions and actual results, our financial statements will be affected. The health of the residential housing market, interest rate environment and the COVID-19 pandemic have introduced significant additional uncertainty with respect to estimates, judgments and assumptions, which may materially impact the estimates previously listed, among others. Recently Issued Accounting Standards Not Yet Adopted In June 2022, the Financial Accounting Standards Board issued guidance to improve existing measurement and disclosure requirements for equity securities that are subject to a contractual sale restriction. This guidance is effective for interim and annual periods beginning after December 15, 2023 on a prospective basis, with early adoption permitted. We expect to adopt this guidance on January 1, 2024. We have not yet determined the impact the adoption of this guidance will have on our financial position, results of operations and cash flows. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations Zillow Offers Wind Down In November 2021, the Board of Directors of Zillow Group made the determination to wind down Zillow Offers operations, and the financial results of Zillow Offers have historically been reported within our Homes segment. This decision was made in light of home pricing unpredictability, capacity constraints and other operational challenges faced by Zillow Offers that were exacerbated by an unprecedented housing market, a global pandemic and a difficult labor and supply chain environment, all of which led us to conclude that, despite its initial promise in earlier quarters, Zillow Offers was unlikely to be a sufficiently stable line of business to meet our goals going forward. The wind down of Zillow Offers was complete as of September 30, 2022, at which time Zillow Offers met the criteria for discontinued operations. We have presented the assets and liabilities and results of operations, excluding allocation of any general corporate expenses, of Zillow Offers for all periods presented as discontinued operations in our condensed consolidated financial statements. No assets or liabilities were classified as discontinued operations as of September 30, 2022. The following table presents the major classes of assets and liabilities of discontinued operations as of December 31, 2021 (in millions): Assets Current assets: Cash and cash equivalents $ 296 Accounts receivable, net 78 Inventory 3,913 Prepaid expenses and other current assets 13 Restricted cash 226 Total current assets of discontinued operations 4,526 Intangible assets, net 4 Other assets 78 Total assets of discontinued operations $ 4,608 Liabilities Current liabilities: Accounts payable $ 6 Accrued expenses and other current liabilities 72 Accrued compensation and benefits 47 Borrowings under credit facilities 2,199 Securitization term loans 1,209 Total current liabilities of discontinued operations $ 3,533 The following table presents the major classes of line items of the discontinued operations included in the condensed consolidated statements of operations for the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Revenue $ 23 $ 1,187 $ 4,249 $ 2,668 Cost of revenue 24 1,414 4,023 2,751 Gross profit (loss) (1) (227) 226 (83) Operating expenses: Sales and marketing 1 90 153 189 Technology and development — 10 6 41 General and administrative — 10 10 26 Restructuring costs — — 25 — Total operating expenses 1 110 194 256 Income (loss) from discontinued operations (2) (337) 32 (339) Loss on extinguishment of debt — — (21) — Other income — — 13 — Interest expense — (16) (36) (25) Loss from discontinued operations before income taxes (2) (353) (12) (364) Income tax benefit (expense) — 6 (1) 1 Net loss from discontinued operations $ (2) $ (347) $ (13) $ (363) Net loss from discontinued operations per share: Basic $ (0.01) $ (1.37) $ (0.05) $ (1.46) Diluted $ (0.01) $ (1.31) $ (0.05) $ (1.38) The following table presents significant non-cash items and capital expenditures of the discontinued operations for the periods presented (in millions): Nine Months Ended 2022 2021 Amortization of debt discount and debt issuance costs $ 21 $ 1 Loss on debt extinguishment 21 — Share-based compensation 16 27 Inventory valuation adjustment 9 304 Depreciation and amortization 7 7 Capital expenditures 1 6 Issuance (settlement) of beneficial interests in securitizations (79) 25 Restructuring There were no restructuring charges attributable to discontinued operations for the three months ended September 30, 2022. The following table presents a summary of restructuring charges attributable to discontinued operations for the periods presented (in millions): Line Item of Discontinued Operations Nine Months Ended Cumulative Amount Recognized Inventory write-down Cost of revenue $ 9 N/A Other charges: Employee termination costs Restructuring costs $ 20 $ 72 Financing-related charges Interest expense and Loss on debt extinguishment 37 43 Contract termination costs Restructuring costs 4 14 Accelerated depreciation and amortization Cost of revenue 14 19 Asset write-offs Restructuring costs — 1 Other charges Restructuring costs 1 1 Total other charges 76 150 Total $ 85 $ 150 Restructuring charges attributable to continued operations relate to employee termination costs within our IMT and Mortgages segments and certain indirect costs of the Homes segment that do not qualify as discontinued operations. These costs were not material for the three months ended September 30, 2022 and totaled $6 million, $2 million and $6 million, respectively, for the nine months ended September 30, 2022. Cumulative restructuring charges attributable to continued operations as of September 30, 2022 totaled $23 million. The remaining liability balance associated with such restructuring charges as of September 30, 2022 is not material. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We apply the following methods and assumptions in estimating our fair value measurements: Cash equivalents — The fair value measurement of money market funds is based on quoted market prices in active markets (Level 1). The fair value measurement of other cash equivalents is based on observable market-based inputs principally derived from or corroborated by observable market data (Level 2). Short-term investments — The fair value measurement of our short-term investments 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 (Level 2). Restricted cash — The carrying value of restricted cash approximates fair value due to the short period of time amounts are held in escrow (Level 1). Mortgage loans held for sale — The fair value of mortgage loans held for sale is generally calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics (Level 2). Forward contracts — The fair value of mandatory loan sales commitments and derivative instruments such as forward sales of mortgage-backed securities that are utilized as economic hedging instruments is calculated by reference to quoted prices for similar assets (Level 2). Interest rate lock commitments — The fair value of interest rate lock commitments (“IRLCs”) is calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics. Expired commitments are excluded from the fair value measurement. Since not all IRLCs will become closed loans, we adjust our fair value measurements for the estimated amount of IRLCs that will not close. This adjustment is effected through the pull-through rate, which represents the probability that an IRLC will ultimately result in a closed loan. For IRLCs that are cancelled or expire, any recorded gain or loss is reversed at the end of the commitment period (Level 3). The following table presents the range and weighted-average pull-through rates used in determining the fair value of IRLCs as of the dates presented: September 30, 2022 December 31, 2021 Range 46% - 100% 42% - 100% Weighted-average 87% 85% Warrant — In July 2022, we entered into a warrant agreement in conjunction with a commercial agreement with a publicly traded company that vests, subject to meeting certain conditions, over a period of five years. The warrant is accounted for as a derivative instrument recorded at fair value with gains and losses recognized in other income, net in our condensed consolidated statements of operations. The warrant is recorded within other assets in our condensed consolidated balance sheet as of September 30, 2022. The fair value measurement is adjusted for the estimated amount of tranches that will not vest. For the three and nine months ended September 30, 2022, we recorded a loss of $4 million in our condensed consolidated statements of operations related to the change in fair value of the warrant (Level 3). The following tables present the balances of assets (liabilities) measured at fair value on a recurring basis, by level within the fair value hierarchy, as of the dates presented (in millions): September 30, 2022 Total Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 1,820 $ 1,820 $ — $ — Short-term investments: U.S. government agency securities 1,353 — 1,353 — Corporate bonds 118 — 118 — Treasury bills 45 — 45 — Warrant 4 — — 4 Mortgage origination-related: Mortgage loans held for sale 49 — 49 — IRLCs (1) — — (1) Forward contracts - other current assets 3 — 3 — Total $ 3,391 $ 1,820 $ 1,568 $ 3 December 31, 2021 Total Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 2,132 $ 2,132 $ — $ — Short-term investments: U.S. government agency securities 471 — 471 — Corporate bonds 33 — 33 — Commercial paper 10 — 10 — Mortgage origination-related: Mortgage loans held for sale 107 — 107 — IRLCs 5 — — 5 Total $ 2,758 $ 2,132 $ 621 $ 5 The following table presents the changes in our IRLCs for the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Balance, beginning of the period $ 2 $ 6 $ 5 $ 12 Issuances 2 23 12 58 Transfers (4) (23) (15) (64) Fair value changes recognized in earnings (1) 1 (3) 1 Balance, end of period $ (1) $ 7 $ (1) $ 7 At September 30, 2022, the notional amounts of the hedging instruments related to our mortgage loans held for sale were $79 million and $131 million for our IRLCs and forward contracts, respectively. At December 31, 2021, the notional amounts of the hedging instruments related to our mortgage loans held for sale were $305 million and $388 million for our IRLCs and forward contracts, respectively. We do not have the right to offset our derivative positions. See Note 11 for the carrying amounts and estimated fair values of our convertible senior notes. |
Cash and Cash Equivalents, Inve
Cash and Cash Equivalents, Investments and Restricted Cash | 9 Months Ended |
Sep. 30, 2022 | |
Cash and Cash Equivalents [Abstract] | |
Cash and Cash Equivalents, Investments and Restricted Cash | Cash and Cash Equivalents, Investments and Restricted Cash The following tables present the amortized cost, gross unrealized gains and losses and estimated fair market value of our cash and cash equivalents, investments, and restricted cash as of the dates presented (in millions): September 30, 2022 Amortized Gross Estimated Cash $ 153 $ — $ 153 Cash equivalents: Money market funds 1,820 — 1,820 Short-term investments: U. S. government agency securities 1,371 (18) 1,353 Corporate bonds 119 (1) 118 Treasury bills 45 — 45 Restricted cash 2 — 2 Total $ 3,510 $ (19) $ 3,491 December 31, 2021 Amortized Gross Estimated Cash $ 183 $ — $ 183 Cash equivalents: Money market funds 2,132 — 2,132 Short-term investments: U.S. government agency securities 473 (2) 471 Corporate bonds 33 — 33 Commercial paper 10 — 10 Restricted cash 1 — 1 Total $ 2,832 $ (2) $ 2,830 The following table presents available-for-sale investments by contractual maturity date as of September 30, 2022 (in millions): Amortized Cost Estimated Fair Due in one year or less $ 1,096 $ 1,083 Due after one year 439 433 Total $ 1,535 $ 1,516 |
Contract Balances
Contract Balances | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Contract Balances | Contract Balances Contract assets were $80 million and $78 million as of September 30, 2022 and December 31, 2021, respectively. Contract assets represent amounts for which we have recognized revenue for contracts that have not yet been invoiced to our customers. Contract assets are primarily related to our Premier Agent Flex, Zillow Lease Connect and StreetEasy Experts offerings, whereby we estimate variable consideration based on the expected number of real estate transactions to be closed for Premier Agent Flex and StreetEasy Experts, and qualified leases to be secured for Zillow Lease Connect. We recognize revenue when we satisfy our performance obligations under the corresponding contracts. StreetEasy Experts is our pay for performance pricing model available in the New York City market for which agents and brokers are provided with leads at no initial cost and pay a performance referral fee only when a real estate purchase transaction is closed with one of the leads. Under the StreetEasy Experts pricing model, the transaction price represents variable consideration, as the amount to which we expect to be entitled varies based on the number of leads that convert into real estate transactions and the value of those transactions. We record a corresponding contract asset for the estimate of variable consideration for StreetEasy Experts when the right to the consideration is conditional. When the right to consideration becomes unconditional, we reclassify amounts to accounts receivable. Contract assets are recorded within prepaid expenses and other current assets in our condensed consolidated balance sheets. For the three months ended September 30, 2022 and 2021, we recognized revenue of $50 million and $51 million, respectively, that was included in the deferred revenue balance at the beginning of the related period. For the nine months ended September 30, 2022 and 2021, we recognized revenue of $51 million and $48 million, respectively, that was included in the deferred revenue balance at the beginning of the related period. As of September 30, 2022 and December 31, 2021, we had $25 million and $35 million, respectively, of contract cost assets. For the three and nine months ended September 30, 2022 and 2021, we did not incur any material impairment losses to our contract cost assets. We recorded amortization expense related to contract cost assets of $7 million and $12 million for the three months ended September 30, 2022 and 2021, respectively, and $23 million and $32 million for the nine months ended September 30, 2022 and 2021, respectively. |
Contract Cost Assets
Contract Cost Assets | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Contract Cost Assets | Contract Balances Contract assets were $80 million and $78 million as of September 30, 2022 and December 31, 2021, respectively. Contract assets represent amounts for which we have recognized revenue for contracts that have not yet been invoiced to our customers. Contract assets are primarily related to our Premier Agent Flex, Zillow Lease Connect and StreetEasy Experts offerings, whereby we estimate variable consideration based on the expected number of real estate transactions to be closed for Premier Agent Flex and StreetEasy Experts, and qualified leases to be secured for Zillow Lease Connect. We recognize revenue when we satisfy our performance obligations under the corresponding contracts. StreetEasy Experts is our pay for performance pricing model available in the New York City market for which agents and brokers are provided with leads at no initial cost and pay a performance referral fee only when a real estate purchase transaction is closed with one of the leads. Under the StreetEasy Experts pricing model, the transaction price represents variable consideration, as the amount to which we expect to be entitled varies based on the number of leads that convert into real estate transactions and the value of those transactions. We record a corresponding contract asset for the estimate of variable consideration for StreetEasy Experts when the right to the consideration is conditional. When the right to consideration becomes unconditional, we reclassify amounts to accounts receivable. Contract assets are recorded within prepaid expenses and other current assets in our condensed consolidated balance sheets. For the three months ended September 30, 2022 and 2021, we recognized revenue of $50 million and $51 million, respectively, that was included in the deferred revenue balance at the beginning of the related period. For the nine months ended September 30, 2022 and 2021, we recognized revenue of $51 million and $48 million, respectively, that was included in the deferred revenue balance at the beginning of the related period. As of September 30, 2022 and December 31, 2021, we had $25 million and $35 million, respectively, of contract cost assets. For the three and nine months ended September 30, 2022 and 2021, we did not incur any material impairment losses to our contract cost assets. We recorded amortization expense related to contract cost assets of $7 million and $12 million for the three months ended September 30, 2022 and 2021, respectively, and $23 million and $32 million for the nine months ended September 30, 2022 and 2021, respectively. |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and Equipment, net The following table presents the detail of property and equipment as of the dates presented (in millions): September 30, 2022 December 31, 2021 Website development costs $ 256 $ 175 Leasehold improvements 90 107 Office equipment, furniture and fixtures 26 26 Computer equipment 19 19 Construction-in-progress 8 7 Property and equipment 399 334 Less: accumulated amortization and depreciation (138) (119) Property and equipment, net $ 261 $ 215 We recorded depreciation expense related to property and equipment (other than website development costs) of $6 million and $8 million for the three months ended September 30, 2022 and 2021, respectively, and $19 million and $20 million for the nine months ended September 30, 2022 and 2021, respectively. We capitalized $37 million and $27 million in website development costs for the three months ended September 30, 2022 and 2021, respectively, and $104 million and $51 million for the nine months ended September 30, 2022 and 2021, respectively. Amortization expense for website development costs included in cost of revenue was $17 million and $8 million for the three months ended September 30, 2022 and 2021, respectively, and $48 million and $24 million for the nine months ended September 30, 2022 and 2021, respectively. |
Acquisition
Acquisition | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisition | Acquisition Acquisition of ShowingTime.com, Inc. On September 30, 2021, Zillow Group acquired ShowingTime.com, Inc. (“ShowingTime”) in exchange for approximately $512 million in cash, subject to certain adjustments. Our acquisition of ShowingTime has been accounted for as a business combination, and assets acquired and liabilities assumed were recorded at their estimated fair values as of September 30, 2021. 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 total purchase price has been allocated to the assets acquired and liabilities assumed, including identifiable intangible assets, based on their respective fair values at the acquisition date. The total purchase price was allocated as follows (in millions): Cash and cash equivalents $ 15 Identifiable intangible assets 111 Goodwill 389 Other acquired assets 6 Deferred tax liability (4) Other assumed liabilities (5) Total purchase price $ 512 The estimated fair value of identifiable intangible assets acquired and associated useful lives consisted of the following (in millions): Estimated Fair Value Estimated Weighted-Average Useful Life (in years) Customer relationships $ 55 8 Developed technology 47 4 Trade names and trademarks 9 10 Total $ 111 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 developed technology and the trade names and trademarks based on the relief-from-royalty method. These fair value measurements were based on Level 3 inputs under the fair value hierarchy. Acquisition-related costs incurred, which primarily included legal, accounting and other external costs directly related to the acquisition, are included within acquisition-related costs in our condensed consolidated statements of operations and were expensed as incurred. Unaudited pro forma earnings information has not been presented as the effects were not material to our condensed consolidated financial statements. |
Intangible Assets, net
Intangible Assets, net | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, net | Intangible Assets, net The following tables present the detail of intangible assets as of the dates presented (in millions): September 30, 2022 Cost Accumulated Amortization Net Customer relationships $ 55 $ (8) $ 47 Developed technology 50 (14) 36 Software 46 (13) 33 Trade names and trademarks 45 (13) 32 Purchased content 7 (6) 1 Total $ 203 $ (54) $ 149 December 31, 2021 Cost Accumulated Amortization Net Customer relationships $ 139 $ (84) $ 55 Developed technology 133 (86) 47 Trade names and trademarks 45 (9) 36 Software 53 (18) 35 Intangibles-in-progress 2 — 2 Purchased content 4 (3) 1 Total $ 376 $ (200) $ 176 Amortization expense recorded for intangible assets for the three months ended September 30, 2022 and 2021 was $11 million and $12 million, respectively, and $47 million and $37 million for the nine months ended September 30, 2022 and 2021, respectively. Amortization expense for trade names and trademarks and customer relationships intangible assets is included in sales and marketing expenses. Amortization expense for all other intangible assets is included in cost of revenue. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt The following table presents the carrying values of Zillow Group’s debt as of the dates presented (in millions): September 30, 2022 December 31, 2021 Mortgages segment Repurchase agreements: Credit Suisse AG, Cayman Islands $ 22 $ 77 Citibank, N.A. 2 17 Warehouse line of credit: Comerica Bank 21 19 Total Mortgages segment debt 45 113 Convertible senior notes: 1.375% convertible senior notes due 2026 495 369 2.75% convertible senior notes due 2025 559 443 0.75% convertible senior notes due 2024 605 507 Total convertible senior notes 1,659 1,319 Total debt $ 1,704 $ 1,432 Mortgages Segment To provide capital for Zillow Home Loans, we utilize master repurchase agreements and a warehouse line of credit. The following table summarizes certain details related to our repurchase agreements and warehouse line of credit (in millions, except interest rates): Lender Maturity Date Maximum Borrowing Capacity Weighted-Average Interest Rate Credit Suisse AG, Cayman Islands March 17, 2023 $ 100 4.73 % Citibank, N.A. June 9, 2023 100 4.89 % Comerica Bank June 24, 2023 50 4.95 % Total $ 250 In accordance with the master repurchase agreements, Credit Suisse and Citibank (together the “Lenders”) have agreed to pay Zillow Home Loans a negotiated purchase price for eligible loans, and Zillow Home Loans has simultaneously agreed to repurchase such loans from the Lenders under a specified timeframe at an agreed upon price that includes interest. The master repurchase agreements contain margin call provisions that provide the Lenders with certain rights in the event of a decline in the market value of the assets purchased under the master repurchase agreements. As of September 30, 2022 and December 31, 2021, $26 million and $87 million, respectively, in mortgage loans held for sale were pledged as collateral under the master repurchase agreements. Borrowings on the repurchase agreements and warehouse line of credit bear interest either at a floating rate based on Secured Overnight Financing Rate (“SOFR”) plus an applicable margin, as defined by the governing agreements, or Bloomberg Short-Term Bank Yield Index Rate (“BSBY”) plus an applicable margin, as defined by the governing agreements. The repurchase agreements and warehouse line of credit include customary representations and warranties, covenants and provisions regarding events of default. As of September 30, 2022, Zillow Home Loans was in compliance with all financial covenants and no event of default had occurred. The repurchase agreements and warehouse line of credit are recourse to Zillow Home Loans, and have no recourse to Zillow Group or any of its other subsidiaries. For additional details related to our warehouse line of credit and repurchase agreements, see Note 13 in the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Convertible Senior Notes Effective January 1, 2022, we adopted guidance which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Refer to Note 2 in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 for additional information regarding the adoption of this guidance. The following tables summarize certain details related to our outstanding convertible senior notes as of the dates presented or for the periods ended (in millions, except interest rates): September 30, 2022 December 31, 2021 Maturity Date Aggregate Principal Amount Stated Interest Rate Effective Interest Rate Semi-Annual Interest Payment Dates Unamortized Debt Issuance Costs Fair Value Unamortized Debt Discount and Debt Issuance Costs Fair Value September 1, 2026 $ 499 1.375 % 1.57 % March 1; September 1 $ 4 $ 484 $ 130 $ 781 May 15, 2025 565 2.75 % 3.20 % May 15; November 15 6 522 122 725 September 1, 2024 608 0.75 % 1.02 % March 1; September 1 3 608 101 945 Total $ 1,672 $ 13 $ 1,614 $ 353 $ 2,451 Three Months Ended Three Months Ended Maturity Date Contractual Coupon Interest Amortization of Debt Issuance Costs Interest Expense Contractual Coupon Interest Amortization of Debt Discount Amortization of Debt Issuance Costs Interest Expense September 1, 2026 $ 2 $ — $ 2 $ 2 $ 5 $ — $ 7 May 15, 2025 4 1 5 4 7 — 11 September 1, 2024 1 1 2 1 8 1 10 July 1, 2023 — — — — — — — Total $ 7 $ 2 $ 9 $ 7 $ 20 $ 1 $ 28 Nine Months Ended Nine Months Ended Maturity Date Contractual Coupon Interest Amortization of Debt Issuance Costs Interest Expense Contractual Coupon Interest Amortization of Debt Discount Amortization of Debt Issuance Costs Interest Expense September 1, 2026 $ 5 $ — $ 5 $ 5 $ 16 $ — $ 21 May 15, 2025 12 2 14 12 21 1 34 September 1, 2024 4 1 5 3 23 2 28 July 1, 2023 — — — 3 8 1 12 Total $ 21 $ 3 $ 24 $ 23 $ 68 $ 4 $ 95 The convertible notes are senior unsecured obligations. The convertible senior notes maturing in 2026 (“2026 Notes”), 2025 (“2025 Notes”) and 2024 (“2024 Notes”) (together, the “Notes”) are classified as long-term debt in our condensed consolidated balance sheets based on their contractual maturity dates. Interest on the convertible notes is paid semi-annually in arrears. The estimated fair value of the convertible senior notes is classified as Level 2 and was determined through consideration of quoted market prices in markets that are not active. The Notes are convertible into cash, shares of Class C capital stock or a combination thereof, at our election, and may be settled as described below. They will mature on their respective maturity date, unless earlier repurchased, redeemed or converted in accordance with their terms. The following table summarizes the conversion and redemption options with respect to the Notes: Maturity Date Early Conversion Date Conversion Rate Conversion Price Optional Redemption Date September 1, 2026 March 1, 2026 22.9830 $ 43.51 September 5, 2023 May 15, 2025 November 15, 2024 14.8810 67.20 May 22, 2023 September 1, 2024 March 1, 2024 22.9830 43.51 September 5, 2022 The following table summarizes certain details related to the capped call confirmations with respect to the convertible senior notes: Maturity Date Initial Cap Price Cap Price Premium September 1, 2026 $ 80.5750 150 % September 1, 2024 72.5175 125 % July 1, 2023 105.45 85 % There were no conversions of convertible senior notes during the three and nine months ended September 30, 2022. The following table summarizes the activity for our convertible senior notes maturing in 2023 (“2023 Notes”) for the three months ended September 30, 2021 (in millions, except share data which are presented in thousands): Aggregate principal amount settled $ 368 Cash paid $ 1 Shares of Class C capital stock issued 4,675 Total fair value of consideration transferred (1) $ 562 Loss on extinguishment of debt: Consideration allocated to the liability component (2) $ 343 Carrying value of the liability component, net of unamortized debt discount and debt issuance costs 328 Loss on extinguishment of debt $ 15 Consideration allocated to the equity component $ 219 The following table summarizes the activity for our 2023 Notes, 2024 Notes and 2026 Notes for the nine months ended September 30, 2021 (in millions, except share data which are presented in thousands): 2023 Notes 2024 Notes 2026 Notes Total Aggregate principal amount settled $ 374 $ 65 $ 1 $ 440 Cash paid $ 1 $ — $ — $ 1 Shares of Class C capital stock issued 4,752 1,485 28 6,265 Total fair value of consideration transferred (1) $ 572 $ 200 $ 4 $ 776 Loss on extinguishment of debt: Consideration allocated to the liability component (2) $ 349 $ 53 $ 1 $ 403 Carrying value of the liability component, net of unamortized debt discount and debt issuance costs 334 51 1 386 Loss on extinguishment of debt $ 15 $ 2 $ — $ 17 Consideration allocated to the equity component $ 223 $ 147 $ 3 $ 373 (1) For convertible senior notes converted by note holders, the total fair value of consideration transferred includes the value of shares transferred to note holders using the daily volume weighted-average price of our Class C capital stock on the conversion date and an immaterial amount of cash paid in lieu of fractional shares. For convertible senior notes redeemed, the total fair value of consideration transferred comprises cash transferred to note holders to settle the related notes. (2) Consideration allocated to the liability component is based on the fair value of the liability component immediately prior to settlement, which was calculated using a discounted cash flow analysis with a market interest rate of a similar liability that does not have an associated convertible feature. The last reported sale price of our Class C capital stock did not exceed 130% of the conversion price of each series of the Notes for more than 20 trading days during the 30 consecutive trading days ended September 30, 2022. Accordingly, each series of the Notes is not redeemable or convertible at the option of the holders from October 1 through December 31, 2022. For additional details related to our convertible senior notes, see Note 13 in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Convertible Senior Notes Repurchase Authorization On December 2, 2021, Zillow Group’s Board of Directors authorized the repurchase of up to $750 million of our Class A common stock, Class C capital stock or a combination thereof. On May 4, 2022, the Board of Directors authorized the repurchase of up to an additional $1.0 billion (together the “Repurchase Authorizations”) of our Class A common stock, Class C capital stock or a combination thereof. On November 1, 2022, Zillow Group’s Board of Directors further expanded the Repurchase Authorizations to allow for the repurchase of a portion of our outstanding Notes. Repurchases of outstanding Notes may be made in open-market transactions or privately negotiated transactions, or in such other manner as deemed appropriate by management, and may be made from time to time as determined by management depending on market conditions, market price of the Notes, trading volume, cash needs and other business factors, in each case as permitted by securities laws and other |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesWe are subject to income taxes in the United States (federal and state), Canada and Serbia. As of September 30, 2022 and December 31, 2021, we have provided a valuation allowance against our net deferred tax assets that we believe, based on the weight of available evidence, are not more likely than not to be realized. We have accumulated federal tax losses of approximately $2.1 billion as of December 31, 2021, which are available to reduce future taxable income. We have accumulated state tax losses of approximately $73 million (tax effected) as of December 31, 2021.Our income tax expense or benefit for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account for the relevant period. We update our estimate of the annual effective tax rate on a quarterly basis and make year-to-date adjustments to the tax provision or benefit, as applicable. We recorded income tax expense of $3 million for the three months ended September 30, 2022 primarily driven by state taxes, and an income tax benefit of $5 million for the three months ended September 30, 2021 primarily driven by state taxes and the decrease in the valuation allowance associated with our September 2021 acquisition of ShowingTime. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders’ Equity Preferred Stock 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, 2022 or December 31, 2021. Common and Capital Stock 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 into Class A common stock upon the affirmative vote by or written consent of holders of a majority of the shares of the Class B common stock. Holders of Class B common stock are entitled to 10 votes for each share. Our Class C capital stock has no preferences or privileges, is not redeemable and, except in limited circumstances, is non-voting. Equity Distribution Agreement On February 17, 2021, we entered into an equity distribution agreement with certain sales agents and/or principals (the “Managers”), pursuant to which we may offer and sell from time to time, through the Managers, shares of our Class C capital stock, having an aggregate gross sales price of up to $1.0 billion, in such share amounts as we may specify by notice to the Managers, in accordance with the terms and conditions set forth in the equity distribution agreement. There were no shares issued under the equity distribution agreement during the three and nine months ended September 30, 2022. The following table summarizes the activity pursuant to the equity distribution agreement for the nine months ended September 30, 2021 (in millions, except share data which are presented in thousands, and per share amounts): Shares of Class C capital stock issued 3,164 Weighted-average issuance price per share $ 174.05 Gross proceeds (1) $ 551 (1) Net proceeds were $545 million after deducting $6 million of commissions and other offering expenses incurred. Stock Repurchase Authorizations Repurchases of stock under the Repurchase Authorizations may be made in open-market transactions or privately negotiated transactions, or in such other manner as deemed appropriate by management, and may be made from time to time as determined by management depending on market conditions, share price, trading volume, cash needs and other business factors, in each case as permitted by securities laws and other legal requirements. As of September 30, 2022, $674 million remained available for future repurchases pursuant to the Repurchase Authorizations. The following table summarizes, on a settlement date basis, our Class A common stock and Class C capital stock repurchase activity under the Repurchase Authorizations for the periods presented (in millions, except share data, which are presented in thousands, and per share amounts): Three Months Ended Nine Months Ended Class A common stock Class C capital stock Class A common stock Class C capital stock Shares repurchased 772 4,225 3,349 13,943 Weighted-average price per share $ 35.52 $ 35.18 $ 46.13 $ 44.40 Total purchase price $ 27 $ 149 $ 154 $ 619 |
Share-Based Awards
Share-Based Awards | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Awards | Share-Based Awards During the first quarter of 2022, in connection with the 2021 annual review cycle, the Compensation Committee of the Board of Directors (the “Compensation Committee”) approved option and restricted stock unit awards under the Zillow Group, Inc. 2020 Incentive Plan (the “2020 Plan”), a portion of which vest quarterly over four years, and a portion of which vest quarterly over a one year period beginning in May 2022. On August 3, 2022, upon recommendation of the Compensation Committee, the Board of Directors approved a supplemental grant of restricted stock units to eligible employees. The supplemental restricted stock units were granted on August 8, 2022 and vest quarterly over a two-year period beginning in August 2022. The exercisability and settlement terms of these equity awards are otherwise consistent with the terms of the option awards and restricted stock units typically granted under the 2020 Plan. When determining the grant date fair value of share-based awards, management considers whether an adjustment is required to the observable market price or volatility of the Company’s Class A common stock or Class C capital stock used in the valuation as a result of material non-public information. For additional information regarding our share-based awards, see Note 16 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Option Award Repricing On August 3, 2022, upon recommendation of the Compensation Committee, the Board of Directors approved adjustments to the exercise price of certain outstanding vested and unvested option awards for eligible employees. The exercise price of eligible option awards was reduced to $38.78, which was the closing market price of our Class C capital stock on August 8, 2022. No other changes were made to the terms and conditions of the eligible option awards. We have accounted for the reprice of the eligible option awards as an equity modification whereby the incremental fair value attributable to the repriced option awards, as measured on the date of reprice, will be recognized as additional share-based compensation expense. The reprice impacted 7 million stock option awards, affected 3,348 employees and is expected to result in incremental share-based compensation expense of $66 million in total, of which $29 million was recognized during the three months ended September 30, 2022, including amounts associated with vested awards. The remaining expense will be recognized over the remaining requisite service period of the original awards. Option Awards The following table summarizes all option award activity for the nine months ended September 30, 2022: Number Weighted- Weighted- Aggregate Outstanding at January 1, 2022 25,746 $ 72.86 7.48 $ 354 Granted 6,792 46.47 Exercised (1,078) 40.59 Forfeited or cancelled (3,061) 88.70 Outstanding at September 30, 2022 28,399 45.25 7.31 8 Vested and exercisable at September 30, 2022 15,398 44.74 6.10 8 The fair value of all option awards granted 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 2022 2021 2022 2021 Expected volatility 61% 55% 55% - 61% 52% - 56% Risk-free interest rate 3.38% 0.76% 1.94% - 3.38% 0.57% - 0.90% Weighted-average expected life 5.00 years 4.75 years 4.50 - 6.00 years 4.50 - 5.75 years Weighted-average fair value of options granted $18.06 $45.40 $23.75 $58.96 The weighted-average total fair value of options repriced was $67.58. As of September 30, 2022, there was a total of $463 million in unrecognized compensation cost related to unvested option awards. Restricted Stock Units The following table summarizes activity for all restricted stock units for the nine months ended September 30, 2022: Restricted Weighted- Unvested outstanding at January 1, 2022 6,074 $ 66.51 Granted 10,664 42.71 Vested (3,278) 53.87 Forfeited (2,193) 60.45 Unvested outstanding at September 30, 2022 11,267 48.85 As of September 30, 2022, there was a total of $510 million in unrecognized compensation cost related to unvested restricted stock units. Share-Based Compensation Expense The following table presents the effects of share-based compensation expense in our condensed consolidated statements of operations during the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Cost of revenue $ 5 $ 2 $ 12 $ 7 Sales and marketing 21 11 46 31 Technology and development 57 25 123 78 General and administrative 64 32 142 88 Restructuring costs — — 2 — Share-based compensation - continuing operations 147 70 325 204 Share-based compensation - discontinued operations 1 9 16 27 Total share-based compensation $ 148 $ 79 $ 341 $ 231 |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Net Loss Per Share | Net Loss Per Share For the periods presented, the following table reconciles the denominators used in the basic and diluted net loss and net income (loss) from continuing operations per share calculations (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Denominator for basic calculation 240,080 254,074 244,157 248,564 Effect of dilutive securities: Option awards — 8,874 — 10,581 Unvested restricted stock units — 2,164 — 2,898 Denominator for dilutive calculation 240,080 265,112 244,157 262,043 For the periods presented, the following Class A common stock and Class C capital stock equivalents were excluded from the calculations of diluted net loss and net income (loss) from continuing operations per share because their effect would have been antidilutive (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Weighted-average Class A common stock and Class C capital stock option awards outstanding 2,417 209 15,942 992 Weighted-average Class A common stock and Class C capital stock restricted stock units outstanding 9,670 1,253 8,326 850 Class C capital stock issuable upon conversion of the convertible notes maturing in 2023, 2024, 2025 and 2026 33,855 33,927 33,855 38,316 Total Class A common stock and Class C capital stock equivalents 45,942 35,389 58,123 40,158 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Interest Rate Lock Commitments We have entered into IRLCs with prospective borrowers under our mortgage origination business whereby we commit to lend a certain loan amount under specific terms and at a specific interest rate to the borrower. These commitments are treated as derivatives and are carried at fair value. For additional information regarding our IRLCs, see Note 4 to our condensed consolidated financial statements. Lease Commitments We have entered into various non-cancelable operating lease agreements for certain of our office space and equipment with original lease periods expiring between 2022 and 2032. For additional information regarding our lease agreements, see Note 12 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Purchase Commitments Purchase commitments primarily include various non-cancelable agreements to purchase content related to our mobile applications and websites and certain cloud computing services. For additional information regarding our purchase obligations, see Note 18 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Escrow Balances In conducting our title and escrow operations through Zillow Closing Services, we routinely hold customers’ assets in escrow, pending completion of real estate transactions, and are responsible for the proper disposition of these balances for our customers. Certain of these amounts are maintained in segregated bank accounts and have not been included in the accompanying condensed consolidated balance sheets. These balances were not material as of September 30, 2022 and $55 million as of December 31, 2021, and pertain to discontinued operations. Letters of Credit As of September 30, 2022, we have outstanding letters of credit of approximately $16 million which secure our lease obligations in connection with certain of our office space operating leases. Surety Bonds In the course of business, we are required to provide financial commitments in the form of surety bonds to third parties as a guarantee of our performance on and our compliance with certain obligations. If we were to fail to perform or comply with these obligations, any draws upon surety bonds issued on our behalf would then trigger our payment obligation to the surety bond issuer. We have outstanding surety bonds issued for our benefit of approximately $13 million and $12 million, respectively, as of September 30, 2022 and December 31, 2021. Legal Proceedings We are involved in a number of legal proceedings concerning matters arising in connection with the conduct of our business activities, some of which are at preliminary stages and some of which seek an indeterminate amount of damages. We regularly evaluate the status of legal proceedings in which we are involved to assess whether a loss is probable or there is a reasonable possibility that a loss or additional loss may have been incurred to determine if accruals are appropriate. We further evaluate each legal proceeding to assess whether an estimate of possible loss or range of loss can be made if accruals are not appropriate. For certain cases described below, management is unable to provide a meaningful estimate of the possible loss or range of possible loss because, among other reasons, (i) the proceedings are in preliminary stages; (ii) specific damages have not been sought; (iii) damages sought are, in our view, unsupported and/or exaggerated; (iv) there is uncertainty as to the outcome of pending appeals or motions; (v) there are significant factual issues to be resolved; and/or (vi) there are novel legal issues or unsettled legal theories presented. For these cases, however, management does not believe, based on currently available information, that the outcomes of these proceedings will have a material effect on our financial position, results of operations or cash flow. For the matters discussed below, we have not recorded any material accruals as of September 30, 2022 or December 31, 2021. In August and September 2017, two purported class action lawsuits were filed against us and certain of our executive officers, alleging, among other things, violations of federal securities laws on behalf of a class of those who purchased our common stock between February 12, 2016 and August 8, 2017. One of those purported class actions, captioned Vargosko v. Zillow Group, Inc. et al , was brought in the U.S. District Court for the Central District of California. The other purported class action lawsuit, captioned Shotwell v. Zillow Group, Inc. et al , was brought in the U.S. District Court for the Western District of Washington. The complaints allege, among other things, that during the period between February 12, 2016 and August 8, 2017, we issued materially false and misleading statements regarding our business practices. The complaints seek to recover, among other things, alleged damages sustained by the purported class members as a result of the alleged misconduct. In November 2017, an amended complaint was filed against us and certain of our executive officers in the Shotwell v. Zillow Group purported class action lawsuit, extending the beginning of the class period to November 17, 2014. In January 2018, the Vargosko v. Zillow Group purported class action lawsuit was transferred to the U.S. District Court for the Western District of Washington and consolidated with the Shotwell v. Zillow Group purported class action lawsuit. In February 2018, the plaintiffs filed a consolidated amended complaint, and in April 2018, we filed our motion to dismiss the consolidated amended complaint. In October 2018, our motion to dismiss was granted without prejudice, and in November 2018, the plaintiffs filed a second consolidated amended complaint, which we moved to dismiss in December 2018. On April 19, 2019, our motion to dismiss the second consolidated amended complaint was denied. On October 11, 2019, plaintiffs filed a motion for class certification which was granted by the court on October 28, 2020. On February 17, 2021, the Ninth Circuit Court of Appeals denied our petition for review of that decision. On October 21, 2022, the parties jointly filed a notice of settlement with the U.S. District Court for the Western District of Washington to inform the court that the parties have reached an agreement in principle to settle this action. The proposed settlement is subject to the negotiation and execution of a settlement agreement and court approval thereof. The full amount of the settlement payment is expected to be paid by the Company’s insurance carriers under its insurance policy. In October and November 2017 and January and February 2018, four shareholder derivative lawsuits were filed in the U.S. District Court for the Western District of Washington and the Superior Court of the State of Washington, King County, against certain of our executive officers and directors seeking unspecified damages on behalf of the Company and certain other relief, such as reform to corporate governance practices. The plaintiffs in the derivative suits (in which the Company is a nominal defendant) allege, among other things, that the defendants breached their fiduciary duties in connection with oversight of the Company’s public statements and legal compliance, and as a result of the breach of such fiduciary duties, the Company was damaged, and defendants were unjustly enriched. Certain of the plaintiffs also allege, among other things, violations of Section 14(a) of the Securities Exchange Act of 1934 and waste of corporate assets. On February 5, 2018, the U.S. District Court for the Western District of Washington consolidated the two federal shareholder derivative lawsuits pending in that court. On February 16, 2018, the Superior Court of the State of Washington, King County, consolidated the two shareholder derivative lawsuits pending in that court. All four of the shareholder derivative lawsuits were stayed until our motion to dismiss the second consolidated amended complaint in the securities class action lawsuit discussed above was denied in April 2019. On July 8, 2019, the plaintiffs in the consolidated federal derivative lawsuit filed a consolidated shareholder derivative complaint, which we moved to dismiss on August 22, 2019. On February 28, 2020, our motion to dismiss the consolidated federal shareholder derivative complaint was denied. On February 16, 2021, the court in the consolidated state derivative matter stayed the action. On March 5, 2021, a new shareholder derivative lawsuit was filed in the U.S. District Court for the Western District of Washington against certain of our executive officers and directors seeking unspecified damages on behalf of the Company and certain other relief, such as reform to corporate governance practices, alleging, among other things, violations of federal securities laws. The U.S. District Court for the Western District of Washington formally consolidated the new lawsuit with the other consolidated federal shareholder derivative lawsuit pending in that court on June 15, 2021. The defendants intend to deny the allegations of wrongdoing and vigorously defend the claims in this consolidated lawsuit. We do not believe that there is a reasonable possibility that a material loss will be incurred related to these derivative matters. On September 17, 2019, International Business Machines Corporation (“IBM”) filed a complaint against us in the U.S. District Court for the Central District of California, alleging, among other things, that the Company has infringed and continues to willfully infringe seven patents held by IBM and seeks unspecified damages, including a request that the amount of compensatory damages be trebled, injunctive relief and costs and reasonable attorneys’ fees. On November 8, 2019, we filed a motion to transfer venue and/or to dismiss the complaint. On December 2, 2019, IBM filed an amended complaint, and on December 16, 2019 we filed a renewed motion to transfer venue and/or to dismiss the complaint. The Company’s motion to transfer venue to the U.S. District Court for the Western District of Washington was granted on May 28, 2020. On August 12, 2020, IBM filed its answer to our counterclaims. On September 18, 2020, we filed four Inter Partes Review (“IPR”) petitions before the U.S. Patent and Trial Appeal Board (“PTAB”) seeking the Board’s review of the patentability with respect to three of the patents asserted by IBM in the lawsuit. On March 15, 2021, the PTAB instituted IPR proceedings with respect to two of the three patents for which we filed petitions. On March 22, 2021, the PTAB denied institution with respect to the last of the three patents. On January 22, 2021, the court partially stayed the action with respect to all patents for which we filed an IPR and set forth a motion schedule. On March 8, 2021, IBM filed its second amended complaint. On March 25, 2021, we filed an amended motion for judgment on the pleadings. On July 15, 2021, the court rendered an order in connection with the motion for judgment on the pleadings finding in our favor on two of the four patents on which we filed our motion. On August 31, 2021, the Court ruled that the parties will proceed with respect to the two patents for which it previously denied judgment, and vacated the stay with respect to one of the three patents for which Zillow filed an IPR, which stay was later reinstated by stipulation of the parties on May 18, 2022. On September 23, 2021, IBM filed a notice of appeal with the United States Court of Appeals for the Federal Circuit with respect to the August 31, 2021 judgment entered, which judgment was affirmed by the Federal Circuit on October 17, 2022. On March 3, 2022, the PTAB ruled on Zillow’s two remaining IPRs finding that Zillow was able to prove certain claims unpatentable, and others it was not. On October 28, 2022, the court found one of the two patents upon which the parties were proceeding in this action as invalid, and dismissed IBM’s claim relating to that patent. Following the court’s ruling, on October 28, 2022, the parties filed a joint stipulation with the court seeking a stay of this action, which was granted by the court on November 1, 2022. We deny the allegations of any wrongdoing and intend to vigorously defend the claims in the lawsuit. There is a reasonable possibility that a loss may be incurred related to this matter; however, the possible loss or range of loss is not estimable. On July 21, 2020, IBM filed a second action against us in the U.S. District Court for the Western District of Washington, alleging, among other things, that the Company has infringed and continues to willfully infringe five patents held by IBM and seeks unspecified damages. On September 14, 2020, we filed a motion to dismiss the complaint filed in the action, to which IBM responded by the filing of an amended complaint on November 5, 2020. On December 18, 2020, we filed a motion to dismiss IBM’s first amended complaint. On December 23, 2020, the Court issued a written order staying this case in full. On July 23, 2021, we filed an IPR with the PTAB with respect to one patent included in the second lawsuit. On October 6, 2021, the stay of this action was lifted, except for proceedings relating to the one patent for which we filed an IPR. On December 1, 2021, the Court dismissed the fourth claim asserted by IBM in its amended complaint. On December 16, 2021 Zillow filed a motion to dismiss the remaining claims alleged in IBM’s amended complaint. On March 9, 2022, the Court granted Zillow’s motion to dismiss in full, dismissing IBM’s claims related to all the patents asserted by IBM in this action, except for the one patent for which an IPR was still pending. On March 10, 2022, the PTAB rendered its decision denying Zillow’s IPR on the one remaining patent, for which this case continues to remain stayed. On August 1, 2022, IBM filed an appeal of the Court’s ruling with respect to two of the dismissed patents. We deny the allegations of any wrongdoing and intend to vigorously defend the claims in the lawsuit. There is a reasonable possibility that a loss may be incurred related to this matter; however, the possible loss or range of loss is not estimable. On November 16, 2021, November 19, 2021 and January 6, 2022, three purported class action lawsuits were filed against us and certain of our executive officers, alleging, among other things, violations of federal securities laws on behalf of a class of those who purchased our stock between August 7, 2020 and November 2, 2021. The three purported class action lawsuits, captioned Barua v. Zillow Group, Inc. et al., Silverberg v. Zillow Group, et al. and Hillier v. Zillow Group, Inc. et al. were brought in the U.S. District Court for the Western District of Washington and were consolidated on February 16, 2022. On May 12, 2022, the plaintiffs filed their amended consolidated complaint which alleges, among other things, that we issued materially false and misleading statements regarding our Zillow Offers business. The complaints seek to recover, among other things, alleged damages sustained by the purported class members as a result of the alleged misconduct. We moved to dismiss the amended consolidated complaint on July 11, 2022, plaintiffs filed their opposition to the motion to dismiss on September 2, 2022, and we filed a reply in support of the motion to dismiss on October 11, 2022. We intend to deny the allegations of wrongdoing and intend to vigorously defend the claims in this consolidated lawsuit. We do not believe that a loss related to this consolidated lawsuit is probable. On March 10, 2022, May 5, 2022 and July 20, 2022 shareholder derivative suits were filed in the U.S. District Court for the Western District of Washington and on July 25, 2022, a shareholder derivative suit was filed in the Superior Court of the State of Washington, King County, against us and certain of our executive officers and directors seeking unspecified damages on behalf of the Company and certain other relief, such as reform to corporate governance practices. The plaintiffs (including the Company as a nominal defendant) allege, among other things, that the defendants breached their fiduciary duties by failing to maintain an effective system of internal controls, which purportedly caused the losses the Company incurred when it decided to wind down Zillow Offers operations. Plaintiffs also allege, among other things, violations of Section 14(a) and Section 20(a) of the Securities Exchange Act of 1934, insider trading and waste of corporate assets. On June 1, 2022 and September 14, 2022, the U.S. District Court for the Western District of Washington issued orders consolidating the three federal derivative suits and staying the consolidated action until further order of the court. On September 15, 2022, the Superior Court of the State of Washington entered a temporary stay in the state derivative suit. The defendants intend to deny the allegations of wrongdoing and vigorously defend the claims in these lawsuits. We do not believe that a loss related to these lawsuits is probable. In addition to the matters discussed above, 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 such litigation or 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 business, financial position, results of operations or cash flow. 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. Indemnifications In the ordinary course of business, we enter into contractual arrangements under which we agree to provide indemnification of varying scope and terms to business partners and other parties with respect to certain matters. For additional information regarding our indemnifications, see Note 18 in the Notes to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. |
Segment Information and Revenue
Segment Information and Revenue | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Segment Information and Revenue | Segment Information and Revenue We have three operating and reportable segments, which have been identified based on the way in which 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 for the Internet, Media & Technology (“IMT”), Mortgages and Homes segments. The IMT segment includes the financial results for the Premier Agent, rentals and new construction marketplaces, as well as display, StreetEasy, ShowingTime+, which houses ShowingTime, Bridge Interactive, dotloop and interactive floor plans, and other advertising and business software solutions. In the first quarter of 2022, we began reporting rentals revenue as a separate revenue category within the IMT segment and prior period amounts have been recast to conform to this presentation. In the fourth quarter of 2021, we began to include the financial results of ShowingTime in the IMT segment. The Mortgages segment primarily includes the financial results for mortgage originations and the sale of mortgages on the secondary market through Zillow Home Loans and advertising sold to mortgage lenders and other mortgage professionals. The Homes segment includes the financial results from title and escrow services performed by Zillow Closing Services and certain indirect costs of the Homes segment which do not qualify as discontinued operations. As discussed in Note 3, as of September 30, 2022, the wind down of Zillow Offers was complete and we have presented the financial results of Zillow Offers as discontinued operations in our condensed consolidated financial statements, and prior period amounts have been recast to conform to this presentation. Revenue and costs are directly attributed to our segments when possible. However, due to the integrated structure of our business, certain costs incurred by one segment may benefit the other segments. These costs primarily include headcount-related expenses, general and administrative expenses including executive, finance, accounting, legal, human resources, recruiting and facilities costs, product development and data acquisition costs, costs related to operating our mobile applications and websites and marketing and advertising costs. These costs are allocated to each segment based on the estimated benefit each segment receives from such expenditures. The chief executive officer reviews information about our revenue categories as well as statement of operations data inclusive of income (loss) from continuing operations before income taxes by segment. This information is included in the following tables for the periods presented (in millions): Three Months Ended Three Months Ended IMT Mortgages Homes IMT Mortgages Homes Revenue: Premier Agent $ 312 $ — $ — $ 359 $ — $ — Rentals 74 — — 67 — — Other 71 — — 54 — — Mortgages — 26 — — 70 — Total revenue 457 26 — 480 70 — Cost of revenue (1) 67 17 5 51 22 9 Gross profit 390 9 (5) 429 48 (9) Operating expenses (1): Sales and marketing 145 20 — 159 29 17 Technology and development 126 16 — 75 7 19 General and administrative 110 25 3 62 18 24 Acquisition-related costs — — — 3 — — Total operating expenses 381 61 3 299 54 60 Income (loss) from continuing operations 9 (52) (8) 130 (6) (69) Segment other income (expense) (4) 1 — — 1 — Segment interest expense — — — — (1) — Income (loss) from continuing operations before income taxes (2) $ 5 $ (51) $ (8) $ 130 $ (6) $ (69) Nine Months Ended Nine Months Ended IMT Mortgages Homes IMT Mortgages Homes Revenue: Premier Agent $ 1,008 $ — $ — $ 1,042 $ — $ — Rentals 206 — — 204 — — Other 208 — — 156 — — Mortgages — 101 — — 195 — Total revenue 1,422 101 — 1,402 195 — Cost of revenue (1) 203 54 21 141 62 25 Gross profit 1,219 47 (21) 1,261 133 (25) Operating expenses (1): Sales and marketing 430 61 11 413 81 38 Technology and development 323 37 9 244 24 51 General and administrative 274 63 33 189 53 61 Restructuring costs 6 2 6 — — — Acquisition-related costs — — — 8 — — Total operating expenses 1,033 163 59 854 158 150 Income (loss) from continuing operations 186 (116) (80) 407 (25) (175) Segment other income (expense) (4) 2 — — 3 — Segment interest expense — (2) — — (4) — Income (loss) from continuing operations before income taxes (2) $ 182 $ (116) $ (80) $ 407 $ (26) $ (175) (1) The following tables present depreciation and amortization expense and share-based compensation expense for each of our segments for the periods presented (in millions): Three Months Ended Three Months Ended IMT Mortgages Homes IMT Mortgages Homes Depreciation and amortization expense $ 32 $ 2 $ — $ 23 $ 2 $ 3 Share-based compensation expense $ 123 $ 23 $ 1 $ 50 $ 9 $ 11 Nine Months Ended Nine Months Ended IMT Mortgages Homes IMT Mortgages Homes Depreciation and amortization expense $ 104 $ 8 $ 2 $ 68 $ 5 $ 8 Share-based compensation expense $ 263 $ 46 $ 14 $ 150 $ 25 $ 29 (2) The following table presents the reconciliation of total segment income (loss) from continuing operations before income taxes to consolidated income (loss) from continuing operations before income taxes for the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Total segment income (loss) from continuing operations before income taxes $ (54) $ 55 $ (14) $ 206 Corporate interest expense (9) (28) (24) (95) Corporate other income 15 1 21 2 Loss on extinguishment of debt — (15) — (17) Consolidated income (loss) from continuing operations before income taxes $ (48) $ 13 $ (17) $ 96 Certain corporate items are not directly attributable to any of our segments, including loss on extinguishment of debt, interest income earned on our short-term investments included in other income and interest costs on our convertible senior notes included in interest expense. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements include Zillow Group, Inc. and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. These condensed consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“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 consolidated financial statements should be read in conjunction with the audited financial statements and accompanying notes included in Zillow Group, Inc.’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, which was filed with the SEC on February 10, 2022. The condensed consolidated balance sheet as of December 31, 2021, included herein, was derived from the audited financial statements of Zillow Group, Inc. as of that date, adjusted for the reclassification of discontinued operations discussed in Note 3. |
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. On an ongoing basis, we evaluate our estimates, including those related to the accounting for certain revenue offerings, restructuring costs, amortization period and recoverability of contract cost assets, website and software development costs, recoverability of long-lived assets and intangible assets, share-based compensation, income taxes, the presentation of discontinued and continuing operations, business combinations and the recoverability of goodwill, among others. To the extent there are material differences between these estimates, judgments or assumptions and actual results, our financial statements will be affected. The health of the residential housing market, interest rate environment and the COVID-19 pandemic have introduced significant additional uncertainty with respect to estimates, judgments and assumptions, which may materially impact the estimates previously listed, among others. |
Recently Issued Accounting Standards Not Yet Adopted | Recently Issued Accounting Standards Not Yet Adopted In June 2022, the Financial Accounting Standards Board issued guidance to improve existing measurement and disclosure requirements for equity securities that are subject to a contractual sale restriction. This guidance is effective for interim and annual periods beginning after December 15, 2023 on a prospective basis, with early adoption permitted. We expect to adopt this guidance on January 1, 2024. We have not yet determined the impact the adoption of this guidance will have on our financial position, results of operations and cash flows. |
Fair Value Measurements | We apply the following methods and assumptions in estimating our fair value measurements: Cash equivalents — The fair value measurement of money market funds is based on quoted market prices in active markets (Level 1). The fair value measurement of other cash equivalents is based on observable market-based inputs principally derived from or corroborated by observable market data (Level 2). Short-term investments — The fair value measurement of our short-term investments 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 (Level 2). Restricted cash — The carrying value of restricted cash approximates fair value due to the short period of time amounts are held in escrow (Level 1). Mortgage loans held for sale — The fair value of mortgage loans held for sale is generally calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics (Level 2). Forward contracts — The fair value of mandatory loan sales commitments and derivative instruments such as forward sales of mortgage-backed securities that are utilized as economic hedging instruments is calculated by reference to quoted prices for similar assets (Level 2). Interest rate lock commitments — The fair value of interest rate lock commitments (“IRLCs”) is calculated by reference to quoted prices in secondary markets for commitments to sell mortgage loans with similar characteristics. Expired commitments are excluded from the fair value measurement. Since not all IRLCs will become closed loans, we adjust our fair value measurements for the estimated amount of IRLCs that will not close. This adjustment is effected through the pull-through rate, which represents the probability that an IRLC will ultimately result in a closed loan. For IRLCs that are cancelled or expire, any recorded gain or loss is reversed at the end of the commitment period (Level 3). |
Segment Reporting | We have three operating and reportable segments, which have been identified based on the way in which 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 for the Internet, Media & Technology (“IMT”), Mortgages and Homes segments. The IMT segment includes the financial results for the Premier Agent, rentals and new construction marketplaces, as well as display, StreetEasy, ShowingTime+, which houses ShowingTime, Bridge Interactive, dotloop and interactive floor plans, and other advertising and business software solutions. In the first quarter of 2022, we began reporting rentals revenue as a separate revenue category within the IMT segment and prior period amounts have been recast to conform to this presentation. In the fourth quarter of 2021, we began to include the financial results of ShowingTime in the IMT segment. The Mortgages segment primarily includes the financial results for mortgage originations and the sale of mortgages on the secondary market through Zillow Home Loans and advertising sold to mortgage lenders and other mortgage professionals. The Homes segment includes the financial results from title and escrow services performed by Zillow Closing Services and certain indirect costs of the Homes segment which do not qualify as discontinued operations. As discussed in Note 3, as of September 30, 2022, the wind down of Zillow Offers was complete and we have presented the financial results of Zillow Offers as discontinued operations in our condensed consolidated financial statements, and prior period amounts have been recast to conform to this presentation. Revenue and costs are directly attributed to our segments when possible. However, due to the integrated structure of our business, certain costs incurred by one segment may benefit the other segments. These costs primarily include headcount-related expenses, general and administrative expenses including executive, finance, accounting, legal, human resources, recruiting and facilities costs, product development and data acquisition costs, costs related to operating our mobile applications and websites and marketing and advertising costs. These costs are allocated to each segment based on the estimated benefit each segment receives from such expenditures. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | The following table presents the major classes of assets and liabilities of discontinued operations as of December 31, 2021 (in millions): Assets Current assets: Cash and cash equivalents $ 296 Accounts receivable, net 78 Inventory 3,913 Prepaid expenses and other current assets 13 Restricted cash 226 Total current assets of discontinued operations 4,526 Intangible assets, net 4 Other assets 78 Total assets of discontinued operations $ 4,608 Liabilities Current liabilities: Accounts payable $ 6 Accrued expenses and other current liabilities 72 Accrued compensation and benefits 47 Borrowings under credit facilities 2,199 Securitization term loans 1,209 Total current liabilities of discontinued operations $ 3,533 The following table presents the major classes of line items of the discontinued operations included in the condensed consolidated statements of operations for the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Revenue $ 23 $ 1,187 $ 4,249 $ 2,668 Cost of revenue 24 1,414 4,023 2,751 Gross profit (loss) (1) (227) 226 (83) Operating expenses: Sales and marketing 1 90 153 189 Technology and development — 10 6 41 General and administrative — 10 10 26 Restructuring costs — — 25 — Total operating expenses 1 110 194 256 Income (loss) from discontinued operations (2) (337) 32 (339) Loss on extinguishment of debt — — (21) — Other income — — 13 — Interest expense — (16) (36) (25) Loss from discontinued operations before income taxes (2) (353) (12) (364) Income tax benefit (expense) — 6 (1) 1 Net loss from discontinued operations $ (2) $ (347) $ (13) $ (363) Net loss from discontinued operations per share: Basic $ (0.01) $ (1.37) $ (0.05) $ (1.46) Diluted $ (0.01) $ (1.31) $ (0.05) $ (1.38) The following table presents significant non-cash items and capital expenditures of the discontinued operations for the periods presented (in millions): Nine Months Ended 2022 2021 Amortization of debt discount and debt issuance costs $ 21 $ 1 Loss on debt extinguishment 21 — Share-based compensation 16 27 Inventory valuation adjustment 9 304 Depreciation and amortization 7 7 Capital expenditures 1 6 Issuance (settlement) of beneficial interests in securitizations (79) 25 |
Restructuring and Related Costs | The following table presents a summary of restructuring charges attributable to discontinued operations for the periods presented (in millions): Line Item of Discontinued Operations Nine Months Ended Cumulative Amount Recognized Inventory write-down Cost of revenue $ 9 N/A Other charges: Employee termination costs Restructuring costs $ 20 $ 72 Financing-related charges Interest expense and Loss on debt extinguishment 37 43 Contract termination costs Restructuring costs 4 14 Accelerated depreciation and amortization Cost of revenue 14 19 Asset write-offs Restructuring costs — 1 Other charges Restructuring costs 1 1 Total other charges 76 150 Total $ 85 $ 150 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement Inputs and Valuation Techniques | The following table presents the range and weighted-average pull-through rates used in determining the fair value of IRLCs as of the dates presented: September 30, 2022 December 31, 2021 Range 46% - 100% 42% - 100% Weighted-average 87% 85% |
Summary of Balances of Cash Equivalents and Investments | The following tables present the balances of assets (liabilities) measured at fair value on a recurring basis, by level within the fair value hierarchy, as of the dates presented (in millions): September 30, 2022 Total Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 1,820 $ 1,820 $ — $ — Short-term investments: U.S. government agency securities 1,353 — 1,353 — Corporate bonds 118 — 118 — Treasury bills 45 — 45 — Warrant 4 — — 4 Mortgage origination-related: Mortgage loans held for sale 49 — 49 — IRLCs (1) — — (1) Forward contracts - other current assets 3 — 3 — Total $ 3,391 $ 1,820 $ 1,568 $ 3 December 31, 2021 Total Level 1 Level 2 Level 3 Cash equivalents: Money market funds $ 2,132 $ 2,132 $ — $ — Short-term investments: U.S. government agency securities 471 — 471 — Corporate bonds 33 — 33 — Commercial paper 10 — 10 — Mortgage origination-related: Mortgage loans held for sale 107 — 107 — IRLCs 5 — — 5 Total $ 2,758 $ 2,132 $ 621 $ 5 |
Schedule of Changes in IRLCs | The following table presents the changes in our IRLCs for the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Balance, beginning of the period $ 2 $ 6 $ 5 $ 12 Issuances 2 23 12 58 Transfers (4) (23) (15) (64) Fair value changes recognized in earnings (1) 1 (3) 1 Balance, end of period $ (1) $ 7 $ (1) $ 7 |
Cash and Cash Equivalents, In_2
Cash and Cash Equivalents, Investments and Restricted Cash (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Cash and Cash Equivalents [Abstract] | |
Amortized Cost, Gross Unrealized Gains and Losses, and Estimated Fair Market Value of Cash and Cash Equivalents and Available-for-Sale Investments | The following tables present the amortized cost, gross unrealized gains and losses and estimated fair market value of our cash and cash equivalents, investments, and restricted cash as of the dates presented (in millions): September 30, 2022 Amortized Gross Estimated Cash $ 153 $ — $ 153 Cash equivalents: Money market funds 1,820 — 1,820 Short-term investments: U. S. government agency securities 1,371 (18) 1,353 Corporate bonds 119 (1) 118 Treasury bills 45 — 45 Restricted cash 2 — 2 Total $ 3,510 $ (19) $ 3,491 December 31, 2021 Amortized Gross Estimated Cash $ 183 $ — $ 183 Cash equivalents: Money market funds 2,132 — 2,132 Short-term investments: U.S. government agency securities 473 (2) 471 Corporate bonds 33 — 33 Commercial paper 10 — 10 Restricted cash 1 — 1 Total $ 2,832 $ (2) $ 2,830 |
Debt Securities, Available-for-sale | The following table presents available-for-sale investments by contractual maturity date as of September 30, 2022 (in millions): Amortized Cost Estimated Fair Due in one year or less $ 1,096 $ 1,083 Due after one year 439 433 Total $ 1,535 $ 1,516 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
Detail of Property and Equipment | The following table presents the detail of property and equipment as of the dates presented (in millions): September 30, 2022 December 31, 2021 Website development costs $ 256 $ 175 Leasehold improvements 90 107 Office equipment, furniture and fixtures 26 26 Computer equipment 19 19 Construction-in-progress 8 7 Property and equipment 399 334 Less: accumulated amortization and depreciation (138) (119) Property and equipment, net $ 261 $ 215 |
Acquisition (Tables)
Acquisition (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The total purchase price was allocated as follows (in millions): Cash and cash equivalents $ 15 Identifiable intangible assets 111 Goodwill 389 Other acquired assets 6 Deferred tax liability (4) Other assumed liabilities (5) Total purchase price $ 512 |
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Business Combination | The estimated fair value of identifiable intangible assets acquired and associated useful lives consisted of the following (in millions): Estimated Fair Value Estimated Weighted-Average Useful Life (in years) Customer relationships $ 55 8 Developed technology 47 4 Trade names and trademarks 9 10 Total $ 111 |
Intangible Assets, net (Tables)
Intangible Assets, net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | The following tables present the detail of intangible assets as of the dates presented (in millions): September 30, 2022 Cost Accumulated Amortization Net Customer relationships $ 55 $ (8) $ 47 Developed technology 50 (14) 36 Software 46 (13) 33 Trade names and trademarks 45 (13) 32 Purchased content 7 (6) 1 Total $ 203 $ (54) $ 149 December 31, 2021 Cost Accumulated Amortization Net Customer relationships $ 139 $ (84) $ 55 Developed technology 133 (86) 47 Trade names and trademarks 45 (9) 36 Software 53 (18) 35 Intangibles-in-progress 2 — 2 Purchased content 4 (3) 1 Total $ 376 $ (200) $ 176 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Carrying Value of Debt | The following table presents the carrying values of Zillow Group’s debt as of the dates presented (in millions): September 30, 2022 December 31, 2021 Mortgages segment Repurchase agreements: Credit Suisse AG, Cayman Islands $ 22 $ 77 Citibank, N.A. 2 17 Warehouse line of credit: Comerica Bank 21 19 Total Mortgages segment debt 45 113 Convertible senior notes: 1.375% convertible senior notes due 2026 495 369 2.75% convertible senior notes due 2025 559 443 0.75% convertible senior notes due 2024 605 507 Total convertible senior notes 1,659 1,319 Total debt $ 1,704 $ 1,432 |
Schedule of Revolving Credit Facilities and Lines of Credit | The following table summarizes certain details related to our repurchase agreements and warehouse line of credit (in millions, except interest rates): Lender Maturity Date Maximum Borrowing Capacity Weighted-Average Interest Rate Credit Suisse AG, Cayman Islands March 17, 2023 $ 100 4.73 % Citibank, N.A. June 9, 2023 100 4.89 % Comerica Bank June 24, 2023 50 4.95 % Total $ 250 |
Schedule of Convertible Senior Notes | The following tables summarize certain details related to our outstanding convertible senior notes as of the dates presented or for the periods ended (in millions, except interest rates): September 30, 2022 December 31, 2021 Maturity Date Aggregate Principal Amount Stated Interest Rate Effective Interest Rate Semi-Annual Interest Payment Dates Unamortized Debt Issuance Costs Fair Value Unamortized Debt Discount and Debt Issuance Costs Fair Value September 1, 2026 $ 499 1.375 % 1.57 % March 1; September 1 $ 4 $ 484 $ 130 $ 781 May 15, 2025 565 2.75 % 3.20 % May 15; November 15 6 522 122 725 September 1, 2024 608 0.75 % 1.02 % March 1; September 1 3 608 101 945 Total $ 1,672 $ 13 $ 1,614 $ 353 $ 2,451 Three Months Ended Three Months Ended Maturity Date Contractual Coupon Interest Amortization of Debt Issuance Costs Interest Expense Contractual Coupon Interest Amortization of Debt Discount Amortization of Debt Issuance Costs Interest Expense September 1, 2026 $ 2 $ — $ 2 $ 2 $ 5 $ — $ 7 May 15, 2025 4 1 5 4 7 — 11 September 1, 2024 1 1 2 1 8 1 10 July 1, 2023 — — — — — — — Total $ 7 $ 2 $ 9 $ 7 $ 20 $ 1 $ 28 Nine Months Ended Nine Months Ended Maturity Date Contractual Coupon Interest Amortization of Debt Issuance Costs Interest Expense Contractual Coupon Interest Amortization of Debt Discount Amortization of Debt Issuance Costs Interest Expense September 1, 2026 $ 5 $ — $ 5 $ 5 $ 16 $ — $ 21 May 15, 2025 12 2 14 12 21 1 34 September 1, 2024 4 1 5 3 23 2 28 July 1, 2023 — — — 3 8 1 12 Total $ 21 $ 3 $ 24 $ 23 $ 68 $ 4 $ 95 The following table summarizes the conversion and redemption options with respect to the Notes: Maturity Date Early Conversion Date Conversion Rate Conversion Price Optional Redemption Date September 1, 2026 March 1, 2026 22.9830 $ 43.51 September 5, 2023 May 15, 2025 November 15, 2024 14.8810 67.20 May 22, 2023 September 1, 2024 March 1, 2024 22.9830 43.51 September 5, 2022 The following table summarizes certain details related to the capped call confirmations with respect to the convertible senior notes: Maturity Date Initial Cap Price Cap Price Premium September 1, 2026 $ 80.5750 150 % September 1, 2024 72.5175 125 % July 1, 2023 105.45 85 % Aggregate principal amount settled $ 368 Cash paid $ 1 Shares of Class C capital stock issued 4,675 Total fair value of consideration transferred (1) $ 562 Loss on extinguishment of debt: Consideration allocated to the liability component (2) $ 343 Carrying value of the liability component, net of unamortized debt discount and debt issuance costs 328 Loss on extinguishment of debt $ 15 Consideration allocated to the equity component $ 219 The following table summarizes the activity for our 2023 Notes, 2024 Notes and 2026 Notes for the nine months ended September 30, 2021 (in millions, except share data which are presented in thousands): 2023 Notes 2024 Notes 2026 Notes Total Aggregate principal amount settled $ 374 $ 65 $ 1 $ 440 Cash paid $ 1 $ — $ — $ 1 Shares of Class C capital stock issued 4,752 1,485 28 6,265 Total fair value of consideration transferred (1) $ 572 $ 200 $ 4 $ 776 Loss on extinguishment of debt: Consideration allocated to the liability component (2) $ 349 $ 53 $ 1 $ 403 Carrying value of the liability component, net of unamortized debt discount and debt issuance costs 334 51 1 386 Loss on extinguishment of debt $ 15 $ 2 $ — $ 17 Consideration allocated to the equity component $ 223 $ 147 $ 3 $ 373 (1) For convertible senior notes converted by note holders, the total fair value of consideration transferred includes the value of shares transferred to note holders using the daily volume weighted-average price of our Class C capital stock on the conversion date and an immaterial amount of cash paid in lieu of fractional shares. For convertible senior notes redeemed, the total fair value of consideration transferred comprises cash transferred to note holders to settle the related notes. (2) Consideration allocated to the liability component is based on the fair value of the liability component immediately prior to settlement, which was calculated using a discounted cash flow analysis with a market interest rate of a similar liability that does not have an associated convertible feature. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Schedule of Sale of Stock | The following table summarizes the activity pursuant to the equity distribution agreement for the nine months ended September 30, 2021 (in millions, except share data which are presented in thousands, and per share amounts): Shares of Class C capital stock issued 3,164 Weighted-average issuance price per share $ 174.05 Gross proceeds (1) $ 551 (1) Net proceeds were $545 million after deducting $6 million of commissions and other offering expenses incurred. |
Class of Treasury Stock | The following table summarizes, on a settlement date basis, our Class A common stock and Class C capital stock repurchase activity under the Repurchase Authorizations for the periods presented (in millions, except share data, which are presented in thousands, and per share amounts): Three Months Ended Nine Months Ended Class A common stock Class C capital stock Class A common stock Class C capital stock Shares repurchased 772 4,225 3,349 13,943 Weighted-average price per share $ 35.52 $ 35.18 $ 46.13 $ 44.40 Total purchase price $ 27 $ 149 $ 154 $ 619 |
Share-Based Awards (Tables)
Share-Based Awards (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Option Award Activity | The following table summarizes all option award activity for the nine months ended September 30, 2022: Number Weighted- Weighted- Aggregate Outstanding at January 1, 2022 25,746 $ 72.86 7.48 $ 354 Granted 6,792 46.47 Exercised (1,078) 40.59 Forfeited or cancelled (3,061) 88.70 Outstanding at September 30, 2022 28,399 45.25 7.31 8 Vested and exercisable at September 30, 2022 15,398 44.74 6.10 8 |
Fair Value of Options Granted, Estimated at Date of Grant Using Black Scholes Merton Option Pricing Model | The fair value of all option awards granted 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 2022 2021 2022 2021 Expected volatility 61% 55% 55% - 61% 52% - 56% Risk-free interest rate 3.38% 0.76% 1.94% - 3.38% 0.57% - 0.90% Weighted-average expected life 5.00 years 4.75 years 4.50 - 6.00 years 4.50 - 5.75 years Weighted-average fair value of options granted $18.06 $45.40 $23.75 $58.96 |
Summary of Restricted Stock Units Activity | The following table summarizes activity for all restricted stock units for the nine months ended September 30, 2022: Restricted Weighted- Unvested outstanding at January 1, 2022 6,074 $ 66.51 Granted 10,664 42.71 Vested (3,278) 53.87 Forfeited (2,193) 60.45 Unvested outstanding at September 30, 2022 11,267 48.85 |
Effects of Share Based Compensation in Consolidated Statements of Operations | The following table presents the effects of share-based compensation expense in our condensed consolidated statements of operations during the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Cost of revenue $ 5 $ 2 $ 12 $ 7 Sales and marketing 21 11 46 31 Technology and development 57 25 123 78 General and administrative 64 32 142 88 Restructuring costs — — 2 — Share-based compensation - continuing operations 147 70 325 204 Share-based compensation - discontinued operations 1 9 16 27 Total share-based compensation $ 148 $ 79 $ 341 $ 231 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | For the periods presented, the following table reconciles the denominators used in the basic and diluted net loss and net income (loss) from continuing operations per share calculations (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Denominator for basic calculation 240,080 254,074 244,157 248,564 Effect of dilutive securities: Option awards — 8,874 — 10,581 Unvested restricted stock units — 2,164 — 2,898 Denominator for dilutive calculation 240,080 265,112 244,157 262,043 For the periods presented, the following Class A common stock and Class C capital stock equivalents were excluded from the calculations of diluted net loss and net income (loss) from continuing operations per share because their effect would have been antidilutive (in thousands): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Weighted-average Class A common stock and Class C capital stock option awards outstanding 2,417 209 15,942 992 Weighted-average Class A common stock and Class C capital stock restricted stock units outstanding 9,670 1,253 8,326 850 Class C capital stock issuable upon conversion of the convertible notes maturing in 2023, 2024, 2025 and 2026 33,855 33,927 33,855 38,316 Total Class A common stock and Class C capital stock equivalents 45,942 35,389 58,123 40,158 |
Segment Information and Reven_2
Segment Information and Revenue (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Revenue Categories | This information is included in the following tables for the periods presented (in millions): Three Months Ended Three Months Ended IMT Mortgages Homes IMT Mortgages Homes Revenue: Premier Agent $ 312 $ — $ — $ 359 $ — $ — Rentals 74 — — 67 — — Other 71 — — 54 — — Mortgages — 26 — — 70 — Total revenue 457 26 — 480 70 — Cost of revenue (1) 67 17 5 51 22 9 Gross profit 390 9 (5) 429 48 (9) Operating expenses (1): Sales and marketing 145 20 — 159 29 17 Technology and development 126 16 — 75 7 19 General and administrative 110 25 3 62 18 24 Acquisition-related costs — — — 3 — — Total operating expenses 381 61 3 299 54 60 Income (loss) from continuing operations 9 (52) (8) 130 (6) (69) Segment other income (expense) (4) 1 — — 1 — Segment interest expense — — — — (1) — Income (loss) from continuing operations before income taxes (2) $ 5 $ (51) $ (8) $ 130 $ (6) $ (69) Nine Months Ended Nine Months Ended IMT Mortgages Homes IMT Mortgages Homes Revenue: Premier Agent $ 1,008 $ — $ — $ 1,042 $ — $ — Rentals 206 — — 204 — — Other 208 — — 156 — — Mortgages — 101 — — 195 — Total revenue 1,422 101 — 1,402 195 — Cost of revenue (1) 203 54 21 141 62 25 Gross profit 1,219 47 (21) 1,261 133 (25) Operating expenses (1): Sales and marketing 430 61 11 413 81 38 Technology and development 323 37 9 244 24 51 General and administrative 274 63 33 189 53 61 Restructuring costs 6 2 6 — — — Acquisition-related costs — — — 8 — — Total operating expenses 1,033 163 59 854 158 150 Income (loss) from continuing operations 186 (116) (80) 407 (25) (175) Segment other income (expense) (4) 2 — — 3 — Segment interest expense — (2) — — (4) — Income (loss) from continuing operations before income taxes (2) $ 182 $ (116) $ (80) $ 407 $ (26) $ (175) (1) The following tables present depreciation and amortization expense and share-based compensation expense for each of our segments for the periods presented (in millions): Three Months Ended Three Months Ended IMT Mortgages Homes IMT Mortgages Homes Depreciation and amortization expense $ 32 $ 2 $ — $ 23 $ 2 $ 3 Share-based compensation expense $ 123 $ 23 $ 1 $ 50 $ 9 $ 11 Nine Months Ended Nine Months Ended IMT Mortgages Homes IMT Mortgages Homes Depreciation and amortization expense $ 104 $ 8 $ 2 $ 68 $ 5 $ 8 Share-based compensation expense $ 263 $ 46 $ 14 $ 150 $ 25 $ 29 (2) The following table presents the reconciliation of total segment income (loss) from continuing operations before income taxes to consolidated income (loss) from continuing operations before income taxes for the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Total segment income (loss) from continuing operations before income taxes $ (54) $ 55 $ (14) $ 206 Corporate interest expense (9) (28) (24) (95) Corporate other income 15 1 21 2 Loss on extinguishment of debt — (15) — (17) Consolidated income (loss) from continuing operations before income taxes $ (48) $ 13 $ (17) $ 96 |
Reconciliation of Segment Gross Profit and Loss | The following table presents the reconciliation of total segment income (loss) from continuing operations before income taxes to consolidated income (loss) from continuing operations before income taxes for the periods presented (in millions): Three Months Ended Nine Months Ended 2022 2021 2022 2021 Total segment income (loss) from continuing operations before income taxes $ (54) $ 55 $ (14) $ 206 Corporate interest expense (9) (28) (24) (95) Corporate other income 15 1 21 2 Loss on extinguishment of debt — (15) — (17) Consolidated income (loss) from continuing operations before income taxes $ (48) $ 13 $ (17) $ 96 |
Discontinued Operations - Major
Discontinued Operations - Major Classes of Assets and Liabilities (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Current assets of discontinued operations | $ 0 | $ 4,526 |
Current liabilities: | ||
Total current liabilities of discontinued operations | 0 | $ 3,533 |
Discontinued Operations, Disposed Of By Means Other Than Sale, Wind Down | Zillow Offers Operations | ||
Current assets: | ||
Cash and cash equivalents | 296 | |
Accounts receivable, net | 78 | |
Inventory | 3,913 | |
Prepaid expenses and other current assets | 13 | |
Restricted cash | 226 | |
Current assets of discontinued operations | 4,526 | |
Intangible assets, net | 4 | |
Other assets | 78 | |
Total assets of discontinued operations | 4,608 | |
Current liabilities: | ||
Accounts payable | 6 | |
Accrued expenses and other current liabilities | 72 | |
Accrued compensation and benefits | 47 | |
Borrowings under credit facilities | 2,199 | |
Securitization term loans | 1,209 | |
Total current liabilities of discontinued operations | $ 3,533 |
Discontinued Operations - Maj_2
Discontinued Operations - Major Line Items Included in Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Operating expenses: | ||||
Net loss from discontinued operations | $ (2) | $ (347) | $ (13) | $ (363) |
Discontinued Operations, Disposed Of By Means Other Than Sale, Wind Down | Zillow Offers Operations | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Revenue | 23 | 1,187 | 4,249 | 2,668 |
Cost of revenue | 24 | 1,414 | 4,023 | 2,751 |
Gross profit (loss) | (1) | (227) | 226 | (83) |
Operating expenses: | ||||
Sales and marketing | 1 | 90 | 153 | 189 |
Technology and development | 0 | 10 | 6 | 41 |
General and administrative | 0 | 10 | 10 | 26 |
Restructuring costs | 0 | 0 | 25 | 0 |
Total operating expenses | 1 | 110 | 194 | 256 |
Income (loss) from discontinued operations | (2) | (337) | 32 | (339) |
Loss on extinguishment of debt | 0 | 0 | (21) | 0 |
Other income | 0 | 0 | 13 | 0 |
Interest expense | 0 | (16) | (36) | (25) |
Loss from discontinued operations before income taxes | (2) | (353) | (12) | (364) |
Income tax benefit (expense) | 0 | 6 | (1) | 1 |
Net loss from discontinued operations | $ (2) | $ (347) | $ (13) | $ (363) |
Net loss from discontinued operations per share: | ||||
Basic (usd per share) | $ (0.01) | $ (1.37) | $ (0.05) | $ (1.46) |
Diluted (usd per share) | $ (0.01) | $ (1.31) | $ (0.05) | $ (1.38) |
Discontinued Operations - Non-C
Discontinued Operations - Non-Cash Items and Capital Expenditures (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Property and equipment purchased on account | $ 2 | $ 2 | ||
Issuance (settlement) of beneficial interests in securitizations | (79) | 25 | ||
Discontinued Operations, Disposed Of By Means Other Than Sale, Wind Down | Zillow Offers Operations | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Amortization of debt discount and debt issuance costs | 21 | 1 | ||
Loss on extinguishment of debt | $ 0 | $ 0 | 21 | 0 |
Share-based compensation | 16 | 27 | ||
Inventory valuation adjustment | 9 | 304 | ||
Depreciation and amortization | 7 | 7 | ||
Property and equipment purchased on account | 1 | 6 | ||
Issuance (settlement) of beneficial interests in securitizations | $ (79) | $ 25 |
Discontinued Operations - Restr
Discontinued Operations - Restructuring (Details) - Zillow Offers Operations - Disposal Group, Disposed of By Means Other Than Sale, Wind-Down - USD ($) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 | Sep. 30, 2022 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | $ 0 | $ 85,000,000 |
Cumulative Amount Recognized | 150,000,000 | |
Inventory write-down | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 9,000,000 | |
Employee termination costs | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 20,000,000 | |
Cumulative Amount Recognized | 72,000,000 | |
Financing-related charges | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 37,000,000 | |
Cumulative Amount Recognized | 43,000,000 | |
Contract termination costs | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 4,000,000 | |
Cumulative Amount Recognized | 14,000,000 | |
Accelerated depreciation and amortization | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 14,000,000 | |
Cumulative Amount Recognized | 19,000,000 | |
Asset write-offs | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 0 | |
Cumulative Amount Recognized | 1,000,000 | |
Other charges | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 1,000,000 | |
Cumulative Amount Recognized | 1,000,000 | |
Total other charges | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 76,000,000 | |
Cumulative Amount Recognized | $ 150,000,000 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - Employee termination costs $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 USD ($) | Sep. 30, 2022 USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Cumulative restructuring charges | $ 23 | $ 23 |
IMT Segment | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 0 | 6 |
Homes | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | 0 | 6 |
Mortgages segment | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Restructuring charges | $ 0 | $ 2 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Measurement Inputs and Valuation Techniques (Details) - IRLCs - Not Designated as Hedging Instrument | Sep. 30, 2022 | Dec. 31, 2021 |
Minimum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value rates, IRLCs | 0.46 | 0.42 |
Maximum | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value rates, IRLCs | 1 | 1 |
Weighted-average | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Fair value rates, IRLCs | 0.87 | 0.85 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 30, 2022 | Jul. 31, 2022 | Dec. 31, 2021 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Warrant term | 5 years | ||
Loss due to fair value adjustment of warrants | $ 4 | ||
Mortgage Loans Held For Sale | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Notional amount | 79 | $ 305 | |
IRLCs | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Notional amount | $ 131 | $ 388 |
Fair Value Measurements - Fai_2
Fair Value Measurements - Fair Value of Cash Equivalents and Investments (Detail) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | $ 1,516 | |
Warrant | 4 | |
Mortgage loans held for sale | 49 | $ 107 |
Total | 3,391 | 2,758 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant | 0 | |
Mortgage loans held for sale | 0 | 0 |
Total | 1,820 | 2,132 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant | 0 | |
Mortgage loans held for sale | 49 | 107 |
Total | 1,568 | 621 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant | 4 | |
Mortgage loans held for sale | 0 | 0 |
Total | 3 | 5 |
Money market funds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 1,820 | 2,132 |
Money market funds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 1,820 | 2,132 |
Money market funds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
Money market funds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash equivalents | 0 | 0 |
U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 1,353 | 471 |
U.S. government agency securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
U.S. government agency securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 1,353 | 471 |
U.S. government agency securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
U.S. government agency securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 118 | 33 |
U.S. government agency securities | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
U.S. government agency securities | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 118 | 33 |
U.S. government agency securities | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | 0 |
Treasury bills | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 45 | |
Treasury bills | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | |
Treasury bills | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 45 | |
Treasury bills | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | |
Commercial paper | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 10 | |
Commercial paper | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | |
Commercial paper | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 10 | |
Commercial paper | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Short-term investments | 0 | |
IRLCs | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | (1) | 5 |
IRLCs | Level 1 | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | 0 |
IRLCs | Level 2 | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | 0 |
IRLCs | Level 3 | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | (1) | $ 5 |
Forward contracts | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 3 | |
Forward contracts | Level 1 | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 0 | |
Forward contracts | Level 2 | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | 3 | |
Forward contracts | Level 3 | Not Designated as Hedging Instrument | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Derivative assets | $ 0 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Changes in IRLCs (Details) - IRLCs - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Derivative Asset, Rollforward [Roll Forward] | ||||
Balance, beginning of the period | $ 2 | $ 6 | $ 5 | $ 12 |
Issuances | 2 | 23 | 12 | 58 |
Transfers | (4) | (23) | (15) | (64) |
Fair value changes recognized in earnings | (1) | 1 | (3) | 1 |
Balance, end of period | $ (1) | $ 7 | $ (1) | $ 7 |
Cash and Cash Equivalents, In_3
Cash and Cash Equivalents, Investments and Restricted Cash - Amortized Cost, Gross Unrealized Gains and Losses, and Estimated Fair Market Value of Cash and Cash Equivalents and Available-for-Sale Investments (Detail) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Cash and Cash Equivalents, at Carrying Value [Abstract] | ||
Cash and cash equivalents | $ 1,973 | $ 2,315 |
Short-term investments: | ||
Amortized Cost | 1,535 | |
Estimated Fair Market Value | 1,516 | |
Restricted cash | 2 | 1 |
Amortized Cost, Total | 3,510 | 2,832 |
Gross Unrealized Losses, Total | (19) | (2) |
Estimated Fair Market Value, Total | 3,491 | 2,830 |
U.S. government agency securities | ||
Short-term investments: | ||
Amortized Cost | 1,371 | 473 |
Gross Unrealized Losses | (18) | (2) |
Estimated Fair Market Value | 1,353 | 471 |
U.S. government agency securities | ||
Short-term investments: | ||
Amortized Cost | 119 | 33 |
Gross Unrealized Losses | (1) | 0 |
Estimated Fair Market Value | 118 | 33 |
Treasury bills | ||
Short-term investments: | ||
Amortized Cost | 45 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Market Value | 45 | |
Commercial paper | ||
Short-term investments: | ||
Amortized Cost | 10 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Market Value | 10 | |
Cash | ||
Cash and Cash Equivalents, at Carrying Value [Abstract] | ||
Cash and cash equivalents | 153 | 183 |
Money market funds | ||
Cash and Cash Equivalents, at Carrying Value [Abstract] | ||
Cash and cash equivalents | $ 1,820 | $ 2,132 |
Cash and Cash Equivalents, In_4
Cash and Cash Equivalents, Investments and Restricted Cash - Available-for-sale Investments By Contractual Maturity Date (Details) $ in Millions | Sep. 30, 2022 USD ($) |
Amortized Cost | |
Due in one year or less | $ 1,096 |
Due after one year | 439 |
Amortized Cost | 1,535 |
Estimated Fair Market Value | |
Due in one year or less | 1,083 |
Due after one year | 433 |
Estimated Fair Market Value | $ 1,516 |
Contract Balances (Details)
Contract Balances (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |||||
Contract asset | $ 80 | $ 80 | $ 78 | ||
Revenue recognized, recorded in deferred revenue as of prior period | $ 50 | $ 51 | $ 51 | $ 48 |
Contract Cost Assets (Details)
Contract Cost Assets (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |||||
Contract cost assets | $ 25,000,000 | $ 25,000,000 | $ 35,000,000 | ||
Impairment of contract cost assets | 0 | $ 0 | 0 | $ 0 | |
Capitalized contract cost, amortization | $ 7,000,000 | $ 12,000,000 | $ 23,000,000 | $ 32,000,000 |
Property and Equipment, net - D
Property and Equipment, net - Detail of Property and Equipment (Detail) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Less: accumulated amortization and depreciation | $ 399 | $ 334 |
Less: accumulated amortization and depreciation | (138) | (119) |
Property and equipment, net | 261 | 215 |
Website development costs | ||
Property, Plant and Equipment [Line Items] | ||
Less: accumulated amortization and depreciation | 256 | 175 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Less: accumulated amortization and depreciation | 90 | 107 |
Office equipment, furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Less: accumulated amortization and depreciation | 26 | 26 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Less: accumulated amortization and depreciation | 19 | 19 |
Construction-in-progress | ||
Property, Plant and Equipment [Line Items] | ||
Less: accumulated amortization and depreciation | $ 8 | $ 7 |
Property and Equipment, net - A
Property and Equipment, net - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Property, Plant and Equipment [Line Items] | ||||
Amortization and depreciation expense related to property and equipment other than website development costs | $ 6 | $ 8 | $ 19 | $ 20 |
Capitalization of website development costs | 37 | 27 | 104 | 51 |
Amortization of website development costs and intangible assets included in technology and development | 11 | 12 | 47 | 37 |
Technology and development | Software Development | ||||
Property, Plant and Equipment [Line Items] | ||||
Amortization of website development costs and intangible assets included in technology and development | $ 17 | $ 8 | $ 48 | $ 24 |
Acquisition - Narrative (Detail
Acquisition - Narrative (Detail) $ in Millions | Sep. 30, 2021 USD ($) |
ShowingTime.com, Inc. | |
Schedule of Equity Method Investments [Line Items] | |
Business combination, consideration transferred | $ 512 |
Acquisition - Preliminary Purch
Acquisition - Preliminary Purchase Price (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | Sep. 30, 2021 |
Schedule of Equity Method Investments [Line Items] | |||
Goodwill | $ 2,374 | $ 2,374 | |
ShowingTime.com, Inc. | |||
Schedule of Equity Method Investments [Line Items] | |||
Cash and cash equivalents | $ 15 | ||
Identifiable intangible assets | 111 | ||
Goodwill | 389 | ||
Other acquired assets | 6 | ||
Deferred tax liability | (4) | ||
Other assumed liabilities | (5) | ||
Total purchase price | $ 512 |
Acquisition - Preliminary Estim
Acquisition - Preliminary Estimated Fair Value and Useful Lives (Details) $ in Millions | Sep. 30, 2021 USD ($) |
Finite-Lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |
Estimated Fair Value | $ 111 |
ShowingTime.com, Inc. | Customer relationships | |
Finite-Lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |
Estimated Fair Value | $ 55 |
Estimated Weighted-Average Useful Life (in years) | 8 years |
ShowingTime.com, Inc. | Developed technology | |
Finite-Lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |
Estimated Fair Value | $ 47 |
Estimated Weighted-Average Useful Life (in years) | 4 years |
ShowingTime.com, Inc. | Trade names and trademarks | |
Finite-Lived Intangible Assets Acquired as Part of Business Combination [Line Items] | |
Estimated Fair Value | $ 9 |
Estimated Weighted-Average Useful Life (in years) | 10 years |
Intangible Assets, net - Intang
Intangible Assets, net - Intangible Assets (Detail) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Cost | $ 203 | $ 376 |
Accumulated Amortization | (54) | (200) |
Net | 149 | 176 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 55 | 139 |
Accumulated Amortization | (8) | (84) |
Net | 47 | 55 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 50 | 133 |
Accumulated Amortization | (14) | (86) |
Net | 36 | 47 |
Software | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 46 | 53 |
Accumulated Amortization | (13) | (18) |
Net | 33 | 35 |
Trade names and trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 45 | 45 |
Accumulated Amortization | (13) | (9) |
Net | 32 | 36 |
Intangibles-in-progress | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 2 | |
Accumulated Amortization | 0 | |
Net | 2 | |
Purchased content | ||
Finite-Lived Intangible Assets [Line Items] | ||
Cost | 7 | 4 |
Accumulated Amortization | (6) | (3) |
Net | $ 1 | $ 1 |
Intangible Assets, net - Additi
Intangible Assets, net - Additional Information (Detail) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of website development costs and intangible assets included in technology and development | $ 11,000,000 | $ 12,000,000 | $ 47,000,000 | $ 37,000,000 |
Non-cash impairment charge | $ 0 | $ 0 | $ 0 | $ 0 |
Debt - Schedule of Carrying Val
Debt - Schedule of Carrying Value of Debt (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Total debt | $ 1,704 | $ 1,432 |
Convertible senior notes: | ||
Debt Instrument [Line Items] | ||
Total convertible senior notes | 1,659 | 1,319 |
Convertible senior notes: | 2026 Notes | ||
Debt Instrument [Line Items] | ||
Total convertible senior notes | $ 495 | 369 |
Stated Interest Rate | 1.375% | |
Convertible senior notes: | 2025 Notes | ||
Debt Instrument [Line Items] | ||
Total convertible senior notes | $ 559 | 443 |
Stated Interest Rate | 2.75% | |
Convertible senior notes: | 2024 Notes | ||
Debt Instrument [Line Items] | ||
Total convertible senior notes | $ 605 | 507 |
Stated Interest Rate | 0.75% | |
Mortgages segment | ||
Debt Instrument [Line Items] | ||
Warehouse line of credit | $ 45 | 113 |
Credit Suisse AG, Cayman Islands | Mortgages segment | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 22 | 77 |
Citibank, N.A. | Mortgages segment | ||
Debt Instrument [Line Items] | ||
Repurchase agreements | 2 | 17 |
Comerica Bank | Line of Credit | Mortgages segment | ||
Debt Instrument [Line Items] | ||
Warehouse line of credit | $ 21 | $ 19 |
Debt - Mortgages Segment, Sched
Debt - Mortgages Segment, Schedule of Warehouse Lines of Credit (Details) - Line of Credit - Mortgages segment | Sep. 30, 2022 USD ($) |
Debt Instrument [Line Items] | |
Maximum Borrowing Capacity | $ 250,000,000 |
Credit Suisse AG, Cayman Islands | |
Debt Instrument [Line Items] | |
Maximum Borrowing Capacity | $ 100,000,000 |
Weighted-Average Interest Rate | 4.73% |
Citibank, N.A. | |
Debt Instrument [Line Items] | |
Maximum Borrowing Capacity | $ 100,000,000 |
Weighted-Average Interest Rate | 4.89% |
Comerica Bank | |
Debt Instrument [Line Items] | |
Maximum Borrowing Capacity | $ 50,000,000 |
Weighted-Average Interest Rate | 4.95% |
Debt - Mortgages Segment - Narr
Debt - Mortgages Segment - Narrative (Detail) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Credit Suisse and Citibank, N.A | Mortgages segment | ||
Debt Instrument [Line Items] | ||
Short-term debt | $ 26 | $ 87 |
Debt - Schedule of Convertible
Debt - Schedule of Convertible Senior Notes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||
Interest Expense | $ 9,000,000 | $ 29,000,000 | $ 26,000,000 | $ 99,000,000 | |
Convertible senior notes: | |||||
Debt Instrument [Line Items] | |||||
Aggregate Principal Amount | 1,672,000,000 | 1,672,000,000 | |||
Unamortized Debt Issuance Costs | 13,000,000 | 13,000,000 | $ 353,000,000 | ||
Fair Value | 1,614,000,000 | 1,614,000,000 | 2,451,000,000 | ||
Contractual Coupon Interest | 7,000,000 | 7,000,000 | 21,000,000 | 23,000,000 | |
Amortization of Debt Discount | 20,000,000 | 68,000,000 | |||
Amortization of Debt Issuance Costs | 2,000,000 | 1,000,000 | 3,000,000 | 4,000,000 | |
Interest Expense | 9,000,000 | 28,000,000 | 24,000,000 | 95,000,000 | |
Convertible senior notes: | 2026 Notes | |||||
Debt Instrument [Line Items] | |||||
Aggregate Principal Amount | $ 499,000,000 | $ 499,000,000 | |||
Stated Interest Rate | 1.375% | 1.375% | |||
Effective Interest Rate | 1.57% | 1.57% | |||
Unamortized Debt Issuance Costs | $ 4,000,000 | $ 4,000,000 | 130,000,000 | ||
Fair Value | 484,000,000 | 484,000,000 | 781,000,000 | ||
Contractual Coupon Interest | 2,000,000 | 2,000,000 | 5,000,000 | 5,000,000 | |
Amortization of Debt Discount | 5,000,000 | 16,000,000 | |||
Amortization of Debt Issuance Costs | 0 | 0 | 0 | 0 | |
Interest Expense | 2,000,000 | 7,000,000 | 5,000,000 | 21,000,000 | |
Convertible senior notes: | 2025 Notes | |||||
Debt Instrument [Line Items] | |||||
Aggregate Principal Amount | $ 565,000,000 | $ 565,000,000 | |||
Stated Interest Rate | 2.75% | 2.75% | |||
Effective Interest Rate | 3.20% | 3.20% | |||
Unamortized Debt Issuance Costs | $ 6,000,000 | $ 6,000,000 | 122,000,000 | ||
Fair Value | 522,000,000 | 522,000,000 | 725,000,000 | ||
Contractual Coupon Interest | 4,000,000 | 4,000,000 | 12,000,000 | 12,000,000 | |
Amortization of Debt Discount | 7,000,000 | 21,000,000 | |||
Amortization of Debt Issuance Costs | 1,000,000 | 0 | 2,000,000 | 1,000,000 | |
Interest Expense | 5,000,000 | 11,000,000 | 14,000,000 | 34,000,000 | |
Convertible senior notes: | 2024 Notes | |||||
Debt Instrument [Line Items] | |||||
Aggregate Principal Amount | $ 608,000,000 | $ 608,000,000 | |||
Stated Interest Rate | 0.75% | 0.75% | |||
Effective Interest Rate | 1.02% | 1.02% | |||
Unamortized Debt Issuance Costs | $ 3,000,000 | $ 3,000,000 | 101,000,000 | ||
Fair Value | 608,000,000 | 608,000,000 | $ 945,000,000 | ||
Contractual Coupon Interest | 1,000,000 | 1,000,000 | 4,000,000 | 3,000,000 | |
Amortization of Debt Discount | 8,000,000 | 23,000,000 | |||
Amortization of Debt Issuance Costs | 1,000,000 | 1,000,000 | 1,000,000 | 2,000,000 | |
Interest Expense | 2,000,000 | 10,000,000 | 5,000,000 | 28,000,000 | |
Convertible senior notes: | 2023 Notes | |||||
Debt Instrument [Line Items] | |||||
Contractual Coupon Interest | 0 | 0 | 0 | 3,000,000 | |
Amortization of Debt Discount | 0 | 8,000,000 | |||
Amortization of Debt Issuance Costs | 0 | 0 | 0 | 1,000,000 | |
Interest Expense | $ 0 | $ 0 | $ 0 | $ 12,000,000 |
Debt - Summary of Conversion an
Debt - Summary of Conversion and Redemption (Details) - Convertible senior notes: | 9 Months Ended |
Sep. 30, 2022 $ / shares | |
2026 Notes | |
Debt Instrument [Line Items] | |
Conversion Rate | 0.0229830 |
Conversion price per share (usd per share) | $ 43.51 |
2025 Notes | |
Debt Instrument [Line Items] | |
Conversion Rate | 0.0148810 |
Conversion price per share (usd per share) | $ 67.20 |
2024 Notes | |
Debt Instrument [Line Items] | |
Conversion Rate | 0.0229830 |
Conversion price per share (usd per share) | $ 43.51 |
Debt - Capped Call Confirmation
Debt - Capped Call Confirmations (Details) - Convertible senior notes: | 9 Months Ended |
Sep. 30, 2022 $ / shares | |
2026 Notes | |
Debt Instrument [Line Items] | |
Initial cap price (usd per share) | $ 80.5750 |
Cap Price Premium | 150% |
2024 Notes | |
Debt Instrument [Line Items] | |
Initial cap price (usd per share) | $ 72.5175 |
Cap Price Premium | 125% |
2023 Notes | |
Debt Instrument [Line Items] | |
Initial cap price (usd per share) | $ 105.45 |
Cap Price Premium | 85% |
Debt - Summary of Convertible D
Debt - Summary of Convertible Debt (Details) - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Debt Instrument [Line Items] | ||||
Cash paid | $ 1,158 | $ 1 | ||
Loss on extinguishment of debt: | ||||
Loss on extinguishment of debt | $ 0 | $ 15 | $ 0 | 17 |
Convertible senior notes: | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount settled | 440 | |||
Cash paid | $ 1 | |||
Shares of Class C capital stock issued (in shares) | 6,265,000 | |||
Total fair value of consideration transferred | $ 776 | |||
Loss on extinguishment of debt: | ||||
Consideration allocated to liability component | 403 | |||
Carrying value of the liability component, net of unamortized debt discount and debt issuance costs | 386 | |||
Loss on extinguishment of debt | 17 | |||
Consideration allocated to the equity component | 373 | |||
2023 Notes | Convertible senior notes: | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount settled | 368 | 374 | ||
Cash paid | $ 1 | $ 1 | ||
Shares of Class C capital stock issued (in shares) | 4,675,000 | 4,752,000 | ||
Total fair value of consideration transferred | $ 562 | $ 572 | ||
Loss on extinguishment of debt: | ||||
Consideration allocated to liability component | 343 | 349 | ||
Carrying value of the liability component, net of unamortized debt discount and debt issuance costs | 328 | 334 | ||
Loss on extinguishment of debt | 15 | 15 | ||
Consideration allocated to the equity component | $ 219 | 223 | ||
2024 Notes | Convertible senior notes: | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount settled | 65 | |||
Cash paid | $ 0 | |||
Shares of Class C capital stock issued (in shares) | 1,485,000 | |||
Total fair value of consideration transferred | $ 200 | |||
Loss on extinguishment of debt: | ||||
Consideration allocated to liability component | 53 | |||
Carrying value of the liability component, net of unamortized debt discount and debt issuance costs | 51 | |||
Loss on extinguishment of debt | 2 | |||
Consideration allocated to the equity component | 147 | |||
2026 Notes | Convertible senior notes: | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount settled | 1 | |||
Cash paid | $ 0 | |||
Shares of Class C capital stock issued (in shares) | 28,000 | |||
Total fair value of consideration transferred | $ 4 | |||
Loss on extinguishment of debt: | ||||
Consideration allocated to liability component | 1 | |||
Carrying value of the liability component, net of unamortized debt discount and debt issuance costs | 1 | |||
Loss on extinguishment of debt | 0 | |||
Consideration allocated to the equity component | $ 3 |
Debt - Convertible Senior Notes
Debt - Convertible Senior Notes Narrative (Details) - Convertible Senior Notes due 2023, 2024, 2025 and 2026 - Convertible senior notes: | 9 Months Ended |
Sep. 30, 2022 day | |
Debt Instrument [Line Items] | |
Debt instrument, convertible threshold percentage | 130% |
Debt instrument, convertible threshold trading days | 20 |
Debt instrument, threshold consecutive trading days | 30 |
Debt - Convertible Senior Not_2
Debt - Convertible Senior Notes Repurchase Authorization Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2022 | May 04, 2022 | Dec. 02, 2021 |
Receivables [Abstract] | |||
Stock repurchase program, authorized amount | $ 1,000 | $ 750 | |
Stock repurchase program, remaining authorized repurchase amount | $ 674 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Schedule Of Income Tax [Line Items] | |||||
Income tax expense (benefit) | $ 3 | $ (5) | $ (1) | $ 0 | |
Federal | |||||
Schedule Of Income Tax [Line Items] | |||||
Net operating loss carryforwards | $ 2,100 | ||||
State | |||||
Schedule Of Income Tax [Line Items] | |||||
Net operating loss carryforwards | $ 73 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | |||
Feb. 17, 2021 USD ($) | Sep. 30, 2022 USD ($) shares | Sep. 30, 2022 USD ($) Vote shares | Sep. 30, 2021 shares | Dec. 31, 2021 shares | |
Class of Stock [Line Items] | |||||
Preferred stock, issued (in shares) | 0 | 0 | 0 | ||
Preferred stock, outstanding (in shares) | 0 | 0 | 0 | ||
Stock repurchase program, remaining authorized repurchase amount | $ | $ 674,000,000 | $ 674,000,000 | |||
Class A common stock | |||||
Class of Stock [Line Items] | |||||
Common stock holders voting right | Vote | 1 | ||||
Conversion of common stock conversion ratio | 1 | ||||
Class B Common Stock | |||||
Class of Stock [Line Items] | |||||
Common stock holders voting right | Vote | 10 | ||||
Class C Capital Stock | Equity Distribution Agreement | |||||
Class of Stock [Line Items] | |||||
Sale of stock, maximum consideration on transaction | $ | $ 1,000,000,000 | ||||
Shares of Class C capital stock sold (in shares) | 0 | 0 | 3,164,000 |
Shareholders' Equity - Summary
Shareholders' Equity - Summary of Equity Distribution (Details) - Class C Capital Stock - Equity Distribution Agreement - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2022 | Sep. 30, 2021 | |
Class of Stock [Line Items] | |||
Shares of Class C capital stock sold (in shares) | 0 | 0 | 3,164,000 |
Weighted-average issuance price per share (usd per share) | $ 174.05 | ||
Gross proceeds | $ 551 | ||
Net proceeds from sale of stock | 545 | ||
Payments for commissions | $ 6 |
Shareholders' Equity - Repurcha
Shareholders' Equity - Repurchase Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2022 | Sep. 30, 2022 | |
Class A common stock | ||
Class of Stock [Line Items] | ||
Shares repurchased (in shares) | 772 | 3,349 |
Weighted-average price per share (in USD per share) | $ 35.52 | $ 46.13 |
Total purchase price | $ 27 | $ 154 |
Class C capital stock | ||
Class of Stock [Line Items] | ||
Shares repurchased (in shares) | 4,225 | 13,943 |
Weighted-average price per share (in USD per share) | $ 35.18 | $ 44.40 |
Total purchase price | $ 149 | $ 619 |
Share-Based Awards - Additional
Share-Based Awards - Additional Information (Details) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Aug. 08, 2022 | Aug. 03, 2022 USD ($) employee $ / shares shares | May 31, 2022 | Sep. 30, 2022 USD ($) | Mar. 31, 2022 | Sep. 30, 2022 USD ($) $ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Vesting period | 2 years | 1 year | 4 years | |||
Share-based compensation arrangement by share-based payment award, options, plan modification, grants in period, weighted average grant date fair value (in usd per share) | $ / shares | $ 67.58 | |||||
Option awards | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Share-based compensation arrangement by share-based payment award, fair value assumptions, exercise price (in usd per share) | $ / shares | $ 38.78 | |||||
Option award repricing, number of stock option awards impacted (in shares) | shares | 7 | |||||
Share-based payment arrangement, plan modification, number of grantees affected | employee | 3,348 | |||||
Option award repricing, incremental shared-based compensation expense | $ 66 | |||||
Share-based payment arrangement, plan modification, incremental cost | $ 29 | |||||
Unrecognized cost of unvested share-based compensation awards | 463 | $ 463 | ||||
Unvested restricted stock units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Total unrecognized compensation cost | $ 510 | $ 510 |
Share-Based Awards - Summary of
Share-Based Awards - Summary of Option Award (Detail) $ / shares in Units, shares in Thousands, $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) $ / shares shares | |
Number of Shares Subject to Existing Options (in thousands) | ||
Beginning Balance (in shares) | shares | 25,746 | |
Granted (in shares) | shares | 6,792 | |
Exercised (in shares) | shares | (1,078) | |
Forfeited or cancelled (in shares) | shares | (3,061) | |
Ending Balance (in shares) | shares | 28,399 | 25,746 |
Vested and exercisable (in shares) | shares | 15,398 | |
Weighted- Average Exercise Price Per Share | ||
Beginning Balance (usd per share) | $ / shares | $ 72.86 | |
Granted (usd per share) | $ / shares | 46.47 | |
Exercised (usd per share) | $ / shares | 40.59 | |
Forfeited or cancelled (usd per share) | $ / shares | 88.70 | |
Ending Balance (usd per share) | $ / shares | 45.25 | $ 72.86 |
Vested and exercisable (usd per share) | $ / shares | $ 44.74 | |
Weighted- Average Remaining Contractual Life (Years) | ||
Weighted-Average Remaining Contractual Life, Outstanding | 7 years 3 months 21 days | 7 years 5 months 23 days |
Weighted-Average Remaining Contractual Life, Vested and exercisable | 6 years 1 month 6 days | |
Aggregate Intrinsic Value | ||
Aggregate Intrinsic Value, Outstanding | $ | $ 8 | $ 354 |
Aggregate Intrinsic Value, Vested and exercisable | $ | $ 8 |
Share-Based Awards - Fair Value
Share-Based Awards - Fair Value of Options Granted, Estimated at Date of Grant Using Black Scholes Merton Option Pricing Model (Detail) - Option awards - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility | 61% | 55% | ||
Risk-free interest rate | 3.38% | 0.76% | ||
Weighted-average expected life | 5 years | 4 years 9 months | ||
Weighted-average fair value of options granted (usd per share) | $ 18.06 | $ 45.40 | $ 23.75 | $ 58.96 |
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility | 55% | 52% | ||
Risk-free interest rate | 1.94% | 0.57% | ||
Weighted-average expected life | 4 years 6 months | 4 years 6 months | ||
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility | 61% | 56% | ||
Risk-free interest rate | 3.38% | 0.90% | ||
Weighted-average expected life | 6 years | 5 years 9 months |
Share-Based Awards - Summary _2
Share-Based Awards - Summary of Restricted Stock Units Activity (Detail) - Unvested restricted stock units shares in Thousands | 9 Months Ended |
Sep. 30, 2022 $ / shares shares | |
Restricted Stock Units (in thousands) | |
Beginning balance (in shares) | shares | 6,074 |
Granted (in shares) | shares | 10,664 |
Vested (in shares) | shares | (3,278) |
Forfeited (in shares) | shares | (2,193) |
Ending balance (in shares) | shares | 11,267 |
Weighted- Average Grant- Date Fair Value | |
Unvested outstanding, beginning balance (usd per share) | $ / shares | $ 66.51 |
Granted (usd per share) | $ / shares | 42.71 |
Vested (usd per share) | $ / shares | 53.87 |
Forfeited (usd per share) | $ / shares | 60.45 |
Unvested outstanding, ending balance (usd per share) | $ / shares | $ 48.85 |
Share-Based Awards - Effects of
Share-Based Awards - Effects of Share Based Compensation in Consolidated Statements of Operations (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | $ 148 | $ 79 | $ 341 | $ 231 |
Share-based compensation - continuing operations | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | 147 | 70 | 325 | 204 |
Share-based compensation - discontinued operations | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | 1 | 9 | 16 | 27 |
Cost of revenue | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | 5 | 2 | 12 | 7 |
Sales and marketing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | 21 | 11 | 46 | 31 |
Technology and development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | 57 | 25 | 123 | 78 |
General and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | 64 | 32 | 142 | 88 |
Restructuring costs | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation | $ 0 | $ 0 | $ 2 | $ 0 |
Net Loss Per Share - Schedule o
Net Loss Per Share - Schedule of Denominators Used in Basic and Diluted Per Share Calculations (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Denominator for basic calculation (in shares) | 240,080 | 254,074 | 244,157 | 248,564 |
Denominator for dilutive calculation (in shares) | 240,080 | 265,112 | 244,157 | 262,043 |
Option awards | ||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Effect of dilutive securities, share-based payment arrangements (in shares) | 0 | 8,874 | 0 | 10,581 |
Unvested restricted stock units | ||||
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | ||||
Effect of dilutive securities, share-based payment arrangements (in shares) | 0 | 2,164 | 0 | 2,898 |
Net Loss Per Share - Antidiluti
Net Loss Per Share - Antidilutive Securities Excluded from Computation of Earnings Per Share (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Class A Common Stock and Class C Capital Stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total Class A common stock and Class C capital stock equivalents (in shares) | 45,942 | 35,389 | 58,123 | 40,158 |
Class A Common Stock and Class C Capital Stock | Weighted-average | Option awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total Class A common stock and Class C capital stock equivalents (in shares) | 2,417 | 209 | 15,942 | 992 |
Class A Common Stock and Class C Capital Stock | Weighted-average | Restricted stock units | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total Class A common stock and Class C capital stock equivalents (in shares) | 9,670 | 1,253 | 8,326 | 850 |
Class C capital stock issuable upon conversion of the convertible notes maturing in 2023, 2024, 2025 and 2026 | Convertible notes maturing in 2023, 2024, 2025 and 2026 | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total Class A common stock and Class C capital stock equivalents (in shares) | 33,855 | 33,927 | 33,855 | 38,316 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions | Sep. 30, 2022 USD ($) | Sep. 14, 2022 claim | Aug. 31, 2022 patent | Jul. 15, 2022 patent | Mar. 02, 2022 patent | Jan. 06, 2022 claim | Dec. 31, 2021 USD ($) | Jul. 23, 2021 patent | Mar. 15, 2021 patent | Sep. 18, 2020 petition patent | Jul. 21, 2020 patent | Sep. 17, 2019 patent | Feb. 28, 2018 claim | Feb. 16, 2018 claim | Feb. 05, 2018 claim | Sep. 30, 2017 claim |
Other Commitments [Line Items] | ||||||||||||||||
Escrow deposit | $ | $ 0 | $ 55 | ||||||||||||||
Outstanding letters of credit | $ | 16 | |||||||||||||||
Outstanding surety bonds | $ | $ 13 | $ 12 | ||||||||||||||
Number of patents infringed | 2 | 3 | 5 | 7 | ||||||||||||
Number of petitions filed | 1 | 4 | ||||||||||||||
Number of patents in favor | 2 | |||||||||||||||
Number of petitions previously denied | 2 | |||||||||||||||
Number of patents vacated | 1 | |||||||||||||||
Number of remaining inter parties review | 2 | |||||||||||||||
Class Action Lawsuits | ||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||
Number of pending claims | claim | 2 | |||||||||||||||
Shareholder Derivative Lawsuits | ||||||||||||||||
Other Commitments [Line Items] | ||||||||||||||||
Number of pending claims | claim | 3 | 3 | 4 | 2 | 2 |
Segment Information and Reven_3
Segment Information and Revenue - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2022 Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 3 |
Number of operating segments | 3 |
Segment Information and Reven_4
Segment Information and Revenue - Revenue Categories (Detail) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenue: | ||||
Total revenue | $ 483 | $ 550 | $ 1,523 | $ 1,597 |
Cost of revenue | 89 | 82 | 278 | 228 |
Gross profit | 394 | 468 | 1,245 | 1,369 |
Operating expenses: | ||||
Sales and marketing | 165 | 205 | 502 | 532 |
Technology and development | 142 | 101 | 369 | 319 |
General and administrative | 138 | 104 | 370 | 303 |
Acquisition-related costs | 0 | 3 | 0 | 8 |
Total operating expenses | 445 | 413 | 1,255 | 1,162 |
Income (loss) from continuing operations | (51) | 55 | (10) | 207 |
Other income, net | 12 | 2 | 19 | 5 |
Interest expense | (9) | (29) | (26) | (99) |
Income (loss) from continuing operations before income taxes | (48) | 13 | (17) | 96 |
Operating Segments | ||||
Operating expenses: | ||||
Income (loss) from continuing operations before income taxes | (54) | 55 | (14) | 206 |
IMT | Operating Segments | ||||
Revenue: | ||||
Total revenue | 457 | 480 | 1,422 | 1,402 |
Cost of revenue | 67 | 51 | 203 | 141 |
Gross profit | 390 | 429 | 1,219 | 1,261 |
Operating expenses: | ||||
Sales and marketing | 145 | 159 | 430 | 413 |
Technology and development | 126 | 75 | 323 | 244 |
General and administrative | 110 | 62 | 274 | 189 |
Restructuring costs | 6 | 0 | ||
Acquisition-related costs | 0 | 3 | 0 | 8 |
Total operating expenses | 381 | 299 | 1,033 | 854 |
Income (loss) from continuing operations | 9 | 130 | 186 | 407 |
Other income, net | (4) | 0 | (4) | 0 |
Interest expense | 0 | 0 | 0 | 0 |
Income (loss) from continuing operations before income taxes | 5 | 130 | 182 | 407 |
IMT | Premier Agent | Operating Segments | ||||
Revenue: | ||||
Total revenue | 312 | 359 | 1,008 | 1,042 |
IMT | Rentals | Operating Segments | ||||
Revenue: | ||||
Total revenue | 74 | 67 | 206 | 204 |
IMT | Other | Operating Segments | ||||
Revenue: | ||||
Total revenue | 71 | 54 | 208 | 156 |
IMT | Mortgages | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Mortgages segment | Operating Segments | ||||
Revenue: | ||||
Total revenue | 26 | 70 | 101 | 195 |
Cost of revenue | 17 | 22 | 54 | 62 |
Gross profit | 9 | 48 | 47 | 133 |
Operating expenses: | ||||
Sales and marketing | 20 | 29 | 61 | 81 |
Technology and development | 16 | 7 | 37 | 24 |
General and administrative | 25 | 18 | 63 | 53 |
Restructuring costs | 2 | 0 | ||
Acquisition-related costs | 0 | 0 | 0 | 0 |
Total operating expenses | 61 | 54 | 163 | 158 |
Income (loss) from continuing operations | (52) | (6) | (116) | (25) |
Other income, net | 1 | 1 | 2 | 3 |
Interest expense | 0 | (1) | (2) | (4) |
Income (loss) from continuing operations before income taxes | (51) | (6) | (116) | (26) |
Mortgages segment | Premier Agent | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Mortgages segment | Rentals | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Mortgages segment | Other | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Mortgages segment | Mortgages | Operating Segments | ||||
Revenue: | ||||
Total revenue | 26 | 70 | 101 | 195 |
Homes | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Cost of revenue | 5 | 9 | 21 | 25 |
Gross profit | (5) | (9) | (21) | (25) |
Operating expenses: | ||||
Sales and marketing | 0 | 17 | 11 | 38 |
Technology and development | 0 | 19 | 9 | 51 |
General and administrative | 3 | 24 | 33 | 61 |
Restructuring costs | 6 | 0 | ||
Acquisition-related costs | 0 | 0 | 0 | 0 |
Total operating expenses | 3 | 60 | 59 | 150 |
Income (loss) from continuing operations | (8) | (69) | (80) | (175) |
Other income, net | 0 | 0 | 0 | 0 |
Interest expense | 0 | 0 | 0 | 0 |
Income (loss) from continuing operations before income taxes | (8) | (69) | (80) | (175) |
Homes | Premier Agent | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Homes | Rentals | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Homes | Other | Operating Segments | ||||
Revenue: | ||||
Total revenue | 0 | 0 | 0 | 0 |
Homes | Mortgages | Operating Segments | ||||
Revenue: | ||||
Total revenue | $ 0 | $ 0 | $ 0 | $ 0 |
Segment Information and Reven_5
Segment Information and Revenue - Depreciation and Amortization Expense and Share-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Depreciation and amortization expense | $ 121 | $ 88 | ||
Share-based compensation expense | 341 | 231 | ||
Homes | Operating Segments | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Depreciation and amortization expense | $ 0 | $ 3 | 2 | 8 |
Share-based compensation expense | 1 | 11 | 14 | 29 |
IMT | Operating Segments | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Depreciation and amortization expense | 32 | 23 | 104 | 68 |
Share-based compensation expense | 123 | 50 | 263 | 150 |
Mortgages segment | Operating Segments | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Depreciation and amortization expense | 2 | 2 | 8 | 5 |
Share-based compensation expense | $ 23 | $ 9 | $ 46 | $ 25 |
Segment Information and Reven_6
Segment Information and Revenue - Reconciliation of Segment Gross Profit and Loss (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total segment income (loss) from continuing operations before income taxes | $ (48) | $ 13 | $ (17) | $ 96 |
Corporate interest expense | (9) | (29) | (26) | (99) |
Corporate other income | 12 | 2 | 19 | 5 |
Loss on extinguishment of debt | 0 | (15) | 0 | (17) |
Consolidated income (loss) from continuing operations before income taxes | (48) | 13 | (17) | 96 |
Operating Segments | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Total segment income (loss) from continuing operations before income taxes | (54) | 55 | (14) | 206 |
Consolidated income (loss) from continuing operations before income taxes | (54) | 55 | (14) | 206 |
Corporate | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Corporate interest expense | (9) | (28) | (24) | (95) |
Corporate other income | 15 | 1 | 21 | 2 |
Loss on extinguishment of debt | $ 0 | $ (15) | $ 0 | $ (17) |