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Cover and table of contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| ☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended March 31, 2023
OR
| ☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from ______ to ______
Commission file number 0-24531
CoStar Group, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 52-2091509 | |||||||
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
| 1331 L Street, NW | ||||||||
| Washington, | DC | 20005 |
(Address of principal executive offices) (Zip Code)
(202) 346-6500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered | ||||||
| Common Stock ($0.01 par value) | CSGP | Nasdaq Global Select Market |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | x | Accelerated filer | ☐ | ||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ☐ | ||||||||
| Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x
As of April 21, 2023, there were 408,539,209 shares of the registrant’s common stock outstanding.
COSTAR GROUP, INC.
FORM 10-Q
TABLE OF CONTENTS
Glossary of Terms
The following abbreviations or acronyms used in this Quarterly Report on Form 10-Q (this "Report") are defined below:
| Abbreviation or Acronym | Definition | ||||
| 2020 Credit Agreement | The second amended and restated credit agreement, which amended and restated in its entirety the then-existing credit agreement originally entered into on April 1, 2014 and amended and restated on July 1, 2020 | ||||
| 2022 Form 10-K | CoStar Group's Annual Report on Form 10-K for the year ended December 31, 2022 filed with the SEC on February 22, 2023 | ||||
| ASC | Accounting Standards Codification | ||||
| ASU | Accounting Standards Update | ||||
| Brexit | The June 23, 2016 U.K. referendum in which British citizens approved an exit from the E.U. | ||||
| Business Immo | The legal entity BIH, a French société par actions simplifiée, the owner and operator of Business Immo, a leading commercial real estate news service provider in France | ||||
| Business Immo Acquisition | CoStar UK's acquisition of the issued share capital of Business Immo on April 5, 2022 | ||||
| CECL | Current expected credit losses | ||||
| CoStar Group (also the “Company,” “we,” “us” or “our”) | The legal entity, CoStar Group, Inc., a Delaware corporation, one or more of its consolidated subsidiaries or operating segments, or the entirety of CoStar Group, Inc. and its consolidated subsidiaries | ||||
| CoStar UK | The legal entity, CoStar UK Limited, a wholly owned subsidiary of CoStar Group | ||||
| Covenant Suspension Period | A period of time defined in the 2020 Credit Agreement in which we maintain a corporate investment grade rating from any two of Standard & Poor’s Rating Services, Fitch Ratings, Inc. or Moody’s Investors Services, Inc. and no event of default is continuing | ||||
| CRI | CoStar Realty Information, Inc., a Delaware corporation and wholly owned subsidiary of CoStar Group, Inc. | ||||
| DSUs | Deferred Stock Units | ||||
| E.U. | European Union | ||||
| EBITDA | Net income before interest income or expense, net; other income or expense, net; loss on debt extinguishment; income taxes; depreciation and amortization | ||||
| ESG | Environmental, Social and Governance | ||||
| ESPP | Employee Stock Purchase Plan | ||||
| EURIBOR | Euro Interbank Offered Rate | ||||
| FASB | Financial Accounting Standards Board | ||||
| GAAP | Generally accepted accounting principles in the U.S. | ||||
| GILTI | Global intangible low taxed income inclusion | ||||
| Halo Merger Sub | Snapped Halo Merger Sub Corp., a Delaware corporation and wholly-owned subsidiary of CoStar Realty Information, Inc. | ||||
| Homes.com | A homes for-sale listings site | ||||
| Homesnap | Homesnap is an online and mobile software platform that provides residential real estate professionals access to applications that manage residential real estate agent workflow and marketing campaigns delivered on third-party platforms acquired in the Homesnap Acquisition | ||||
| Homesnap, Inc. | The legal entity Homesnap, Inc., a Delaware corporation | ||||
| Homesnap Acquisition | CRI's acquisition of Homesnap completed on December 22, 2020, pursuant to an Agreement and Plan of Merger dated November 20, 2020 between CRI, Snapped Halo Merger Sub Corp., a Delaware corporation and wholly owned subsidiary of CRI, and Homesnap, Inc., a Delaware corporation. Snapped Halo Merger Sub Corp. was merged with and into Homesnap, Inc., with Homesnap, Inc. surviving the merger as a wholly owned subsidiary of CRI | ||||
| Land.com Network | Our network of sites featuring rural lands for sale including: LandsofAmerica, LandAndFarm and LandWatch |
| Abbreviation or Acronym | Definition | ||||
| LIBOR | London Interbank Offered Rate | ||||
| Matching RSUs | Awards of matching restricted stock units awarded under the Company's Management Stock Purchase Plan | ||||
| MSPP | Management Stock Purchase Plan | ||||
| ROU | Right-of-use | ||||
| SEC | U.S. Securities and Exchange Commission | ||||
| Securities Act | Securities Act of 1933, as amended | ||||
| SEM | Search Engine Marketing | ||||
| Senior Notes | 2.800% notes issued by CoStar Group, Inc. due July 15, 2030 | ||||
| SOFR | Secured Overnight Financing Rate | ||||
| STAR Report | A benchmarking tool used by the hospitality industry to compare a hotel's performance against a set of similar hotels in the same geographical area. | ||||
| STR | Originally known as "Smith Travel Research", STR is a global data and analytics company that specializes in benchmarking hotel performance and providing market insights to the industry | ||||
| TDR | Troubled debt restructuring | ||||
| Ten-X | The legal entity Ten-X Holding Company, Inc. and its directly and indirectly owned subsidiaries | ||||
| U.K. | The United Kingdom of Great Britain and Northern Ireland | ||||
| U.S. | The United States of America |
PART I — FINANCIAL INFORMATION
Next: Item 1. Financial Statements