REA Group Delivers 4% Revenue Growth, Boosted by Yield Gains and Tech Expansion

About REA Group Ltd

REA Group Ltd (ASX: REA), a global leader in digital real-estate advertising and data services, reported a solid performance for the quarter ended 30 September 2025, underscoring its strong market position, expanding technology portfolio, and disciplined cost management. Headquartered in Melbourne, the company operates Australia’s leading property platforms—realestate.com.au, realcommercial.com.au, and Flatmates.com.au—alongside international operations in India and strategic stakes in digital mortgage, proptech, and AI-driven real-estate technologies.

Backed by its majority shareholder News Corporation, REA continues to leverage its digital ecosystem to connect buyers, sellers, and agents through data-driven solutions. Chief Executive Officer Cameron McIntyre described the quarter as “a strong start to the financial year,” adding that the company’s clear strategic focus and strong talent base position it well for continued growth in an evolving property landscape.

Financial Performance

For the first quarter of FY26, REA Group generated revenue of $429 million, up 4% compared with the same period last year. EBITDA (excluding associates) rose 5% to $254 million, while free cash flow climbed 16% to $86 million, reflecting robust operational execution and working-capital efficiency.

The Australian business remained the primary growth engine, contributing $405 million, or approximately 94% of total revenue, representing a 6% increase from the prior year. Growth was underpinned by strong adoption of premium listings, pricing uplifts across key products, and the resilience of Australia’s property market despite moderating listing volumes relative to the prior year’s record levels.

By contrast, REA India’s revenue declined 20% YoY to $24 million, primarily due to the strategic exit from non-core businesses such as Housing Edge and the divestment of PropTiger, both part of a broader initiative to streamline operations and sharpen focus on the Housing.com platform.

Australian Operations

REA’s Australian operations delivered a strong quarter, with momentum driven by yield expansion and steady consumer engagement.

Residential segment revenue rose 4% YoY, powered by a 13% increase in buy yield despite an 8% national decline in listings. The yield uplift reflected a 7% average Premiere+ price increase, broader adoption of premium add-ons such as Audience Maximiser and Luxe, and growing subscription revenues from agencies seeking enhanced visibility.

Rent revenue also improved, aided by a 6% price rise and higher depth penetration, though listing volumes fell 2% due to constrained rental supply.

The Commercial and New Homes segments maintained double-digit momentum. Commercial revenue was supported by a 7% average price rise, while New Homes revenue growth exceeded expectations, driven by a 7% increase in project-profile volumes and continued strength in display-revenue streams.

The company’s Financial Services arm also had a robust quarter, achieving a 16% increase in mortgage settlements, offset slightly by higher broker payout ratios as competition intensified across the lending landscape.

Audience Leadership and Platform Engagement

REA Group continued to dominate Australia’s digital property market, achieving record audience metrics on its flagship platform realestate.com.au. Average monthly unique visitors reached 12.6 million, with 6.7 million users exclusively using REA’s site.

User engagement remained unmatched, with 147.9 million monthly visits—over 111 million more than its nearest competitor—and a 19% YoY increase in buyer enquiries. The company also reported a 10% rise in active members and a 35% surge in seller leads, underscoring the growing depth of user interaction and platform loyalty.

These engagement metrics not only reinforce REA’s brand strength but also translate directly into yield growth, as advertisers and agents increasingly prioritise REA’s ecosystem for maximum exposure to qualified property audiences.

International Operations

In India, REA India faced headwinds due to regulatory changes affecting the commercial viability of Housing Edge, which has now been discontinued. While Housing.com continues to show steady progress, management is reshaping its international strategy toward profitability and sustainable market leadership.

The divestment of PropTiger to Aurum PropTech Ltd. for a 5.5% equity stake allowed REA to simplify its Indian operations while securing exposure to a broader technology platform. The transaction generated a non-core gain of $4 million on completion in late September 2025.

Operating costs in India fell 22%, reflecting the removal of underperforming business units and lower incentive expenses, aligning the region’s cost base with its refined growth strategy.

Innovation and Strategic Expansion

REA continued to advance its innovation agenda with the acquisition of Planitar Inc., the Canadian maker of iGUIDE, for $55 million. The 61.5% controlling stake strengthens REA’s capabilities in 3D property visualisation, AI-powered floor-plan generation, and immersive virtual-tour creation—technologies increasingly integral to digital property marketing.

With annual revenue of approximately $21 million, iGUIDE was EBITDA-neutral in FY25 and has been consolidated into REA’s accounts from 1 October 2025. The acquisition is expected to bolster REA’s value proposition to agents and developers while expanding its footprint in the North American proptech market.

Operating expenses rose modestly by 3%, driven by wage inflation, technology investments, and marketing initiatives such as Ready25, a major customer event held during the quarter. Excluding cost of goods sold, Australian operating expenses grew 8%, reflecting strategic reinvestment to support product innovation and customer engagement.

Outlook

REA Group remains optimistic about the outlook for FY26, with national residential buy listings expected to remain broadly in line with last year’s healthy levels. October listings declined 3% YoY, but activity in Melbourne (up 2%) and Sydney (up 6%) points to stabilisation in supply conditions heading into the December quarter.

The company continues to target double-digit buy-yield growth, supported by a 7% national average Premiere and price rise, ongoing digital adoption, and favourable geographic mix. Management also expects positive operating jaws for the year, with core expenses forecast to rise mid-single digits, balancing innovation spending with disciplined cost control.

Despite short-term variability in listings, REA’s strong market position, diversified product suite, and expanding international footprint provide a robust foundation for sustainable earnings growth.