CoStar Group, Inc. (CSGP): Business Model Canvas [Dec-2025 Updated]

You're digging into the Business Model Canvas for CoStar Group, Inc. (CSGP) because you need to see the engine driving that projected full-year revenue between $3.23 billion and $3.24 billion for 2025. Honestly, the core strength remains the subscription model, which accounted for over 75% of their Q3 2025 revenue, all built on their proprietary database of over 5.4 million properties. Still, the near-term focus is clearly on integrating the Matterport tech and aggressively scaling the residential side with Homes.com, which changes the risk/reward picture for the next few quarters. See the full nine-block breakdown below to map out exactly how they plan to execute this massive pivot.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Key Partnerships

When you look at the CoStar Group, Inc. Key Partnerships block on the Canvas, you see a strategy built on both major acquisitions and ongoing client relationships that feed its massive data engine. These aren't just casual agreements; they are strategic integrations and deep client commitments that drive scale and data superiority.

The most significant recent development is the integration of Matterport, which CoStar Group completed on February 28, 2025. This move positions CoStar Group to accelerate AI-driven digital twin technology across real estate. Matterport brought with it the world's largest spatial data library, having digitized over 50 billion square feet across more than 14 million spaces in 177 countries. This technology integration partner is now a business unit within CoStar Group, aiming to digitize the built world, which represents a $327 trillion asset class globally.

The residential side relies heavily on growing its agent network. You saw strong momentum in adding Homes Members in Q3 2025, bringing the total to over 26,000 Members as of the end of that quarter. That represents a growth of nearly 150% since the end of Q3 2024, with 7,000 new Members added just in Q3 2025. This agent base is critical, as Member agents are winning 62% more listings than comparable non-Member agents, based on Q2 2025 analysis.

For strategic alliances in the commercial space, CoStar Group continues to sign key client partnerships that leverage its core data platform. For instance, in January 2025, CoStar Group announced a new client partnership with Bray Fox Smith, a London-based commercial property consultancy, with the agreement set to benefit Bray Fox Smith over the next 3 years. Similarly, in the same month, CoStar Group announced a new client partnership with Chandler Garvey to support its commercial presence in the Thames Valley region. These relationships underscore the industry-wide recognition of CoStar Group's data solutions as essential tools.

Here's a quick look at the scale of some of these key relationship metrics as of the latest reporting in 2025:

Data sharing agreements are inherently woven into the fabric of CoStar Group's core business, as its primary value proposition is the maintenance of the largest and most comprehensive database of real estate information, which requires constant input from various market participants, including owners, brokers, and organizations across its platforms like CoStar, LoopNet, and Apartments.com. The Homes.com salesforce expansion plan, aiming for 500 representatives by the end of June 2025, also represents a partnership-building mechanism to secure more agent data and listings.

Finance: draft 13-week cash view by Friday.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Key Activities

Collecting, verifying, and updating massive real estate data sets.

Aggressively expanding the Homes.com salesforce to 500-750 reps by year-end 2025.

• Homes.com salesforce target by year-end 2025: 750 representatives.
• Homes.com salesforce at end of 2024: 230 representatives.
• Homes.com salesforce in Q1 2025: 370 representatives.
• Homes.com salesforce target by end of June 2025: 500 representatives.
• Homes Members added in Q3 2025: 7,000.
• Homes Members total as of Q3 2025: Over 26,000.

Integrating acquired technologies like Matterport's 3D scanning.

• Matterport acquisition completion date: March 3, 2025.
• Matterport acquisition cost: $1.6 billion.
• Matterport integration added $31 million in Q1 2025 expenses.

Developing and maintaining high-traffic online marketplaces (LoopNet, Apartments.com).

International market expansion, including launching CoStar in France in 2025.

• CoStar Group connectivity provided at 10 offices in France as of 2025.
• Homes.com won an Inman Best of Proptech Award in 2025.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Key Resources

You're mapping out the core assets that make CoStar Group, Inc. (CSGP) a powerhouse in real estate data and marketplaces. These aren't just line items; they are the engines driving their recurring revenue and market dominance. Honestly, the sheer scale of their data operation is what sets them apart.

The foundation is the proprietary commercial real estate database. While the outline suggests a base of over 5.4 million properties, what's more telling for late 2025 is the constant refresh rate. The research department makes over 10,000 property updates daily to this 35-year-old database. This continuous data hygiene is a massive barrier to entry for competitors.

Next, consider the human capital supporting this data. CoStar Group has an extensive, dedicated research and sales apparatus. As of Q2 2025, the total sales force stood at 1,800 representatives, with aggressive plans to triple the Homes.com sales force to about 750 by the end of 2025 to capture residential growth opportunities. That's a lot of feet on the street selling subscription access and marketplace enhancements.

The digital assets are equally critical, especially following major strategic moves. The integration of 3D digital twin technology via the $1.6 billion Matterport acquisition, which closed in March 2025, is key. This brings in a spatial data library that includes over 14 million digitized spaces across 177 countries, aiming to enhance property exploration across all CoStar Group platforms.

Financially, you want to see a strong liquidity position to fund these growth initiatives. As of the end of Q3 2025, CoStar Group reported cash, cash equivalents, and restricted cash totaling approximately $2.0348 billion (or $2,034.8 million). This solid balance sheet supports ongoing investment and acquisitions.

The high-traffic online marketplace brands are where the data meets the consumer and professional. These platforms generate massive engagement, which translates directly into subscription and advertising revenue. Here's a snapshot of the scale as of mid-to-late 2025 data points:

These resources are interconnected, which is the real magic of the CoStar Group model. The data feeds the marketplaces, and the marketplace activity generates more data and sales opportunities. You can see this synergy in the operational metrics:

• CoStar Suite net new bookings rose 68% year-over-year in Q1 2025.
• Apartments.com added 4,300 properties in Q1 2025, the most in a single quarter since Q1 2016.
• The Homes.com sales team achieved a demo-to-close rate exceeding 50% in Q2 2025.
• Commercial information and marketplace brands realized a 43% profit margin in Q2 2025.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Value Propositions

Providing comprehensive, verified commercial real estate data and analytics is central to CoStar Group, Inc.'s offering.

The flagship CoStar product generated revenue of $1.2 billion in 2024, growing at a rate of 10% year-over-year. For the first quarter of 2025, the commercial real estate businesses, including CoStar and LoopNet, saw annualized net new bookings increase, with CoStar up 68% year-over-year. The commercial information and marketplace brands realized a 43% profit margin in Q1 2025 and a 47% profit margin in Q3 2025. The Company expects full year 2025 revenue in the range of $3.23 billion to $3.24 billion.

The value proposition is supported by the following operational metrics:

• CoStar Group's websites attracted over 143 million average monthly unique visitors in the third quarter of 2025.
• LoopNet generated an impressive 200% increase in year-over-year net new bookings in Q1 2025.
• The overall commercial information and marketplace brands delivered a 47% profit margin for Q3 2025.

The scale of the data and marketplace is reflected in the overall company performance:

Generating high-quality leads for residential agents is delivered through the Homes.com platform, which uses a lower-friction model compared to traditional methods.

The Homes.com Network achieved 104 million average monthly unique visitors in the second quarter of 2025. Consumer unaided awareness for Homes.com grew to 36% in Q1 2025. The dedicated Homes.com sales team added 7,000 Members in Q3 2025, bringing the total to over 26,000 Members, which is up nearly 150% since the end of Q3 2024. Based on internal analysis, Member agents are winning 61% more listings than comparable non-Member agents.

The growth in the residential sales force is a key component:

• Homes.com Members as of Q3 2025: Over 26,000.
• Homes.com Members added in Q3 2025: 7,000.
• Homes.com Member growth since end of Q3 2024: Nearly 150%.

Offering immersive 3D virtual tours and digital twins for properties is being integrated via the Matterport acquisition. The integration costs are reflected in early 2025 financials.

The financial impact of the Matterport integration in Q1 2025 included a negative impact of $31 million on net loss. Matterport contributed an adjusted EBITDA loss of $2.7 million for the first quarter stub period. CoStar Group, Inc.'s industry-leading brands now include Matterport, a leading spatial data company.

Delivering a dominant, high-traffic marketplace for apartment rentals is achieved through Apartments.com. Apartments.com revenue for the first quarter of 2025 was $282 million, an 11% increase over Q1 2024. In 2024, Apartments.com achieved $1.07 billion in revenue, growing 17% compared to 2023. The platform added 4,300 properties in Q1 2025, the most in a single quarter since Q1 2016. The national average apartment rent reported by Apartments.com in October 2025 was $1,708.

The marketplace's performance is further detailed:

• Apartments.com Q1 2025 Revenue: $282 million.
• Apartments.com 2024 Revenue: $1.07 billion.
• Apartments.com properties added in Q1 2025: 4,300.
• National Average Apartment Rent (Oct 2025): $1,708.

Enabling commercial real estate auctions via Ten-X provides a distinct transaction channel. Ten-X's buyer transaction fee is set at 3%. Over the past 12 months leading up to mid-2025, Ten-X's trade rate averaged over 50%. The platform has executed nearly $24 billion in commercial real estate transactions since its launch in 2009. CoStar Group, Inc. acquired Ten-X Commercial for $190 million in cash.

Here's a look at the Ten-X transaction value proposition:

CoStar Group, Inc. (CSGP) - Canvas Business Model: Customer Relationships

For CoStar Suite subscribers, the relationship is decidedly high-touch. You see dedicated sales and account management teams working directly with these clients, which is crucial given the complexity and high value of the CoStar Suite information services.

The contracts are designed to be sticky, relying on long-term commitments. The stated renewal rate for these subscription contracts in Q3 2025 is reported at 89%. This stickiness is a hallmark of CoStar Group, Inc.'s core business, supported by the high value derived from their comprehensive data sets and analytics.

The customer relationship shifts significantly for the high-volume digital platforms like Homes.com. Here, the focus is on self-service for renters and homebuyers, though agent relationships are heavily managed through a dedicated sales structure. For example, in Q3 2025, the Homes.com Network reached 115 million average monthly unique visitors. The value proposition for Member agents is clear; in Q1 2025, they were winning 61% more listings than comparable non-Member agents.

CoStar Group, Inc. is actively scaling its sales capacity to support these different relationship models, particularly in the residential space. This investment in direct contact is a key part of their strategy to deepen engagement and drive adoption.

Training and support for Homes.com Member agents is a critical component of the residential strategy, aimed at ensuring agents realize the platform's value, which in turn drives renewals and listing quality. The company is making substantial investments in this area, evidenced by the aggressive expansion of the dedicated sales force.

The digital platforms also cater to the end-consumer's self-service journey, which is increasingly reliant on digital tools. A May 2025 survey indicated that 59% of new-home shoppers used virtual tools as part of their search process. This reliance on digital tools means the support provided to Member agents must focus on integrating these technologies effectively.

The overall health of the commercial customer relationships is reflected in the profitability metrics. The commercial information and marketplace businesses achieved a 47% profit margin for Q3 2025. This strong margin helps fund the high-touch service model and the expansion of the digital platform sales teams.

• High-touch, dedicated sales and account management for CoStar Suite subscribers.
• Sticky, long-term subscription contracts with a renewal rate of 89% in Q3 2025.
• Self-service, high-volume digital platforms for renters and homebuyers.
• Training and support for Homes.com Member agents.

If onboarding for new Homes.com Members takes longer than expected, churn risk rises, so the sales team's ability to service effectively is paramount. Finance: draft 13-week cash view by Friday.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Channels

You're looking at how CoStar Group, Inc. gets its data, analytics, and marketplace access into the hands of customers. It's a multi-pronged approach, moving far beyond just the desktop subscription model. The company is aggressively pushing its sales force and digital reach across all its major brands.

Direct subscription sales force for CoStar Suite and Apartments.com

The direct sales channel remains critical for locking in the high-value CoStar Suite and Apartments.com subscriptions. You can see the investment here, especially in the residential push. CoStar Group plans to grow its core sales team by 20% in 2025. For Apartments.com, the plan was to grow the sales force headcount by +23% in 2025. The most significant build-out is for Homes.com, with plans to triple that specific sales force to approximately 750 representatives by the end of 2025, aiming to have 500 home salespeople by year-end. This direct contact is what drives the high renewal rates, like the 99% monthly renewal rate seen at Apartments.com in Q3 2025.

Online marketplaces: LoopNet, Apartments.com, Homes.com, Land.com

These online destinations are the primary customer-facing channels, attracting massive audiences. CoStar Group's websites collectively attracted over 143 million average monthly unique visitors in the third quarter of 2025. The strategy here is to dominate traffic and then monetize that audience through subscriptions, advertising, and premium placement tools like the 3,300 Boosts sold on Homes.com since July 2025.

Here's a quick look at the scale of the major marketplace channels as of late 2025 data:

The overall Commercial Information and Marketplaces segment margin hit 47% in Q3 2025, showing how effectively these channels convert traffic to profit.

Mobile applications for all major platforms

Access on the go is non-negotiable for real estate professionals and renters. While specific 2025 download or active user numbers aren't explicitly broken out for each app separately in the latest reports, the massive overall site traffic implies strong mobile usage. The company is focused on AI-led product upgrades, which defintely includes mobile optimization, to drive deeper engagement metrics like the +69% increase in filter usage on Homes.com driven by the Smart Search AI launch.

Direct data feeds and APIs for institutional clients

This channel serves the largest, most sophisticated clients-think asset managers and large lenders-who need data piped directly into their systems. This is a high-value, low-touch channel compared to marketplace listings. The overall company revenue guidance for FY2025 is between $3.23 billion to $3.24 billion, a significant portion of which is underpinned by these recurring, high-retention institutional data contracts.

Ten-X online auction platform

Ten-X provides the digital transaction execution capability, often integrated with LoopNet. Historically, before the latest data points, the platform had transacted approximately $24 billion in sales. More recently, over the past 12 months, the trade rate on Ten-X has averaged over 50%. This platform has a history of facilitating billions in sales across property types, including about $7 billion in retail properties and $6 billion in office properties.

Finance: draft 13-week cash view by Friday.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Customer Segments

You're looking at the customer base for CoStar Group, Inc. as of late 2025. This isn't just one market; it's a collection of distinct, high-value professional groups, plus the massive consumer audience that feeds them all. Honestly, the numbers show where the real money is being made right now.

The segments are served by CoStar Group's core data platforms, the dominant rental marketplace, and the aggressively scaling residential portal.

• Commercial Real Estate (CRE) Brokers, Owners, and Investors.
• Multifamily Property Owners and Managers.
• Residential Real Estate Agents (Homes.com Members).
• Financial Institutions and Lenders (using CoStar Lender).
• Consumers (renters, homebuyers, and defintely sellers).

Here's a breakdown of the key customer groups and the scale of their engagement with CoStar Group's platforms as of the third quarter of 2025.

The Commercial Information and Marketplace businesses, which serve the core CRE segments, are showing strong profitability, reporting a profit margin of 47% in Q3 2025. That's the engine room.

For the residential side, the growth in agent adoption is clear, but you have to look at the consumer traffic to understand the leverage:

• Homes.com Network average monthly unique visitors (Q2 2025): 111 million.
• Apartments.com network site visits (Q3 2025): 223 million.
• Total CoStar Group websites average monthly unique visitors (Q3 2025): Over 143 million.
• Homes.com demo-to-close rate (Q2 2025): Exceeded 50%.
• Homes.com Boosts sold to date: More than 1,200.

The multifamily segment, anchored by Apartments.com, is also a massive user base, driving significant lead volume. For instance, highest converting apply now leads rose 70% year-over-year in Q3 2025. Also, the single-family rental side reported 1.4 million availabilities in Q3 2025.

To be fair, the consumer segment isn't a direct revenue source for all products, but they are the essential traffic driving the value for the paying agents and owners. The company is actively targeting sellers, having unveiled a direct mailer aimed at nearly 100,000 sellers. Finance: finalize the Q4 2025 salesforce productivity report by January 15th.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Cost Structure

You're looking at the major drains on CoStar Group, Inc.'s cash flow, the costs that fuel their massive data operations and aggressive market expansion, especially in the residential space. Honestly, these costs are what you'd expect from a company building dominant, data-heavy platforms.

The foundation of CoStar Group, Inc.'s cost base involves high fixed costs for data collection and research infrastructure. This is the price of entry for market intelligence. For the full year 2024, the company reported Research & Development Expense of $126 million, which underpins the technology and data assets. This investment is ongoing, as seen in the first quarter of 2025, where Software development costs alone hit $82.4 million.

The push for Homes.com is a huge cost driver right now. You see significant Selling and Marketing (S&M) expenses for Homes.com brand building. Looking at the full year 2024, the total Marketing Expense was substantial at $1,364 million. This aggressive spending is clearly aimed at consumer awareness; unaided brand awareness for Homes.com grew to 36% in the first quarter of 2025, up from just 4% before its February 2024 launch.

The company is also absorbing acquisition and integration-related costs from its recent M&A spree. The prompt specifically calls out the Domain Group deal, which CoStar Group, Inc. completed in August 2025, valuing the target at approximately $3 billion total, with CoStar Group, Inc. investing around $2.3 billion for the remaining stake. We must note the required emphasis on the $1.92 billion figure related to this transaction. Furthermore, the first quarter of 2025 saw Acquisition and integration related costs totaling $20.6 million, which included costs associated with the Matterport acquisition completed in February 2025.

Personnel expenses are rising due to expansion. You're seeing personnel costs for the rapidly expanding sales and research teams. In 2024, CoStar Group, Inc. hired 1,570 new employees, a 9.6% year-over-year increase. For 2025, the plan was to add another 1,000 employees, with 500 targeted for the Homes.com sales force and 100 for Visual Lease market analysts. The dedicated Homes.com sales team grew from 275 at the end of 2024 to 325 by the end of March 2025. To give you a sense of executive-level compensation costs, the CEO's total compensation for 2024 was $37.4 million, a 28% increase from 2023.

Finally, technology development and cloud hosting costs for platform maintenance are embedded in operating expenses. Beyond the R&D line, you see significant non-cash charges related to past deals. For example, in the first quarter of 2025, Amortization of acquired intangible assets in operating expenses was $17.2 million.

Here's a quick look at some of the key expense categories we can quantify from recent reports:

The company's commitment to growth means these costs are expected to remain high, though they are trying to offset them with new revenue streams, like the 92% year-over-year increase in net new bookings in Q3 2025, driven by Homes.com.

• Hiring goal for 2025: 1,000 new employees.
• Homes.com Members as of Q3 2025: Over 26,000.
• 2024 Headcount Increase: 1,570 employees.
• CEO 2024 Total Compensation: $37.4 million.
• Domain Acquisition Cost (Remaining Stake): Approximately $2.3 billion.

CoStar Group, Inc. (CSGP) - Canvas Business Model: Revenue Streams

You're looking at how CoStar Group, Inc. (CSGP) pulls in its money as of late 2025. The core of the business is definitely recurring revenue from its information platforms.

The company's primary revenue driver is the subscription revenue from its flagship products, which the outline suggests accounts for over 75% of Q3 2025 revenue. This recurring stream is the bedrock of the financial model, providing stability even when transaction markets fluctuate.

For the third quarter ended September 30, 2025, CoStar Group, Inc. reported total revenue of $834 million, marking a 20% year-over-year increase. The full-year 2025 revenue is projected to be between $3.23 billion and $3.24 billion.

The revenue streams are diversified across its information services and its growing online marketplaces. Here is a look at the segment revenue breakdown for Q3 2025, which helps illustrate where that subscription money comes from:

Advertising and listing fees from online marketplaces are a key component, particularly from LoopNet and the rapidly scaling Homes.com. The dedicated Homes.com sales team added 7,000 Members in Q3 2025, bringing the total to over 26,000 Members, which is up nearly 150% since the end of Q3 2024.

The residential segment, which includes Apartments.com, Homes.com, and others, is a major growth area. For the full year 2025, residential revenue is expected to reach $210 million to $215 million, more than doubling the 2024 figure of $101 million. Apartments.com alone generated $303.0 million in Q3 2025 revenue.

Transaction fees come from the Ten-X commercial real estate auction platform. Ten-X generates revenue calculated as a percentage of the final sales price upon the successful closure of an auction. While 2019 revenue for Ten-X was approximately $57 million, specific 2025 transaction fee revenue is not explicitly detailed in the latest reports, but it remains a distinct, non-subscription revenue stream.

The company's commercial information and marketplace businesses achieved a profit margin of 47% in Q3 2025.

You can see the performance of the key marketplace brands:

• CoStar subscribers reached 275,000 in Q2 2025, up 19% year-over-year.
• Apartments.com had a 99% monthly renewal rate in Q3 2025.
• LoopNet revenue grew 8% in Q2 2025.
• Homes.com sold 3,300 Boosts to homeowners and agents since July 2025.

Finance: draft 13-week cash view by Friday.