CoStar Group, Inc. (CSGP) laid out an aggressive roadmap on Wednesday that includes a massive buyback, record profitability targets, and a strategic pullback on its residential real estate ambitions. The company's announcing a $1.5 billion share repurchase program, following the accelerated completion of its $500 million buyback in 2025.

The 2026 Vision

CoStar is projecting revenue between $3.78 billion and $3.82 billion for 2026, which would represent roughly 18% growth over the midpoint of its 2025 guidance. That's solid momentum for a company pivoting its strategy.

The real headline here is adjusted EBITDA. The company expects to deliver between $740 million and $800 million, hitting a 20% margin at the midpoint. That represents a staggering 83% year-over-year growth compared to the 2025 guidance midpoint and would mark the highest adjusted EBITDA in company history. Net income is projected at $175 million to $215 million, with adjusted EPS landing between $1.22 and $1.33.

CoStar is betting big on artificial intelligence to drive this transformation. The company plans to accelerate AI deployment across its operations in 2026, building on existing efficiencies in content creation, public records research, coding, and lease data extraction. The goal is to enhance AI capabilities across its marketplace platforms to improve user experience and strengthen competitive positioning.

Looking Further Ahead

The mid-term outlook extends the growth story. CoStar projects a revenue compound annual growth rate of approximately 15% for 2025 through 2028, with adjusted EBITDA reaching $1.25 billion by 2028.

Here's where things get interesting: Homes.com, the company's residential real estate platform that sits alongside Apartments.com in its portfolio, is getting a significant budget haircut. CoStar is shifting from aggressive growth spending to efficient scaling and profitability. Net investment in Homes.com will drop by over $300 million in 2026 alone, down from $850 million in 2025. The company plans to reduce spending by more than $100 million each year through 2030.

The payoff timeline? CoStar projects Homes.com will generate more revenue than expenses by 2029 and achieve positive adjusted EBITDA in 2030.

What Management Is Saying

Andy Florance, Founder and CEO of CoStar Group, framed the strategy as a path to sustained growth: "This positions CoStar Group to capture compelling near- and long-term growth with significant adjusted EBITDA expansion for several years to come. Homes.com is an important part of our ecosystem; we now have a clear path to accelerate top-line growth and drive profitability. Through the deployment of our scalable AI platform and our disciplined capital allocation approach, we are well positioned to build on our strong trajectory and drive enhanced stockholder value."

Despite the optimistic outlook, CoStar Group shares were down 2.73% at $65.36 at the time of publication on Wednesday.