Matterport Q2 2024 Financial Results: Revenue Growth Offset by Increasingly Heavy Losses

August 7, 2024

Matterport, the real estate spatial data platform under offer from CoStar Group, released its Q2 and half-year 2024 results this week, with losses for the quarter greater than the previous five quarters combined.

Highlights include:

  • Total revenue was $42.2 million, up 6.7% YoY (was $39.5 million)
  • Subscription revenue of $24.2 million up 15% YoY (was $20.9 million)
  • Quarterly net losses triple YoY to $141.5 million (was $56.5 million)
  • Annualized Recurring Revenue hits record $96.6 million, up 16% year-over-year
  • Total subscribers grew to 1.06 million, up 28% year-over-year

RJ Pittman, chairman and CEO at Matterport, commented:

"I’m pleased to announce our second-quarter 2024 results, which underscore our ongoing success in driving efficient growth. Subscription revenue increased by 16% year-over-year, reaching a record $24.2 million, and now accounts for over 57% of our total revenue.

"This growth highlights our strategic focus on expanding the recurring subscription revenue within our business.

"Q2 was marked by bold product innovation. Our latest AI initiative, Project Genesis, along with our spatial data-driven efforts like Property Intelligence from our Q1 Winter Release, have been well received by customers and partners. We are actively developing the future of the digital twin and look forward to unveiling more breakthroughs in our Fall Release later this year."

 

JD Fay, CFO at Matterport, said:

"Our second quarter results represent continued revenue growth and improvements in Non-GAAP net loss per share year-over-year. Steady subscription revenue growth, gross margin expansion, and continued operating expense discipline drove our non-GAAP loss per share to $0.02, which is a 71% year-on-year improvement.

"These results underscore our steadfast commitment to profitability and highlight the significant progress we are making in transforming the industry."

 

Despite good comms and an optimistic outlook, the reality for Matterport is that it continues to be a market leader that can't make a profit.

If anything, the firm is struggling more than ever.

Q2 losses of $141.5 million widened by 150% from the same period in 2023, while quarter-on-quarter losses widened by 292%; Matterport had lost $36.1 million in the three months to March 2024.

Put into context, Matterport has doubled its subscription revenue in the past four years and is now generating roughly $8 million in monthly subscription revenues.

However, total losses of circa $440 million across the past 14 quarters equate to an average monthly loss of $31.5 million.

In other words, since Q1 2021, Matterport has spent $4 for every $1 earned.

Therefore, the emergence of CoStar Group's $1.6 billion takeover bid earlier this year has come at a critical time for Matterport, with shareholders approving the deal in late July.

Regarding the upcoming acquisition, Matterport said:

CoStar Group will acquire all outstanding shares of Matterport in a cash and stock transaction valued at $5.50 per share, representing an equity value of approximately $2.1 billion and an enterprise value of approximately $1.6 billion based on the closing price for CoStar Group common stock on April 19, 2024.

Under the terms and subject to the conditions of the agreement, Matterport stockholders will receive $2.75 in cash and $2.75 in shares of CoStar Group common stock for each share of Matterport common stock.

In light of the pending transaction, the Company had previously suspended its financial guidance for the full fiscal year 2024 and will not be providing financial guidance for the upcoming fiscal quarter.

At a special meeting of stockholders held on July 26, 2024, Matterport stockholders approved the transaction with CoStar Group, Inc.

 

Andy Florance has his work cut out for him.

Given his continued pursuit of Zillow and Realtor.com in the United States, Rightmove and Zillow in the United Kingdom (via OnTheMarket), an international expansion strategy in Europe that has yet to bear fruit or fireworks—and now the additional headache of bailing out Matterport—CoStar Group's CEO is dealing with possibly the most complex and expensive strategy in global real estate.

Meanwhile, Matterport must prepare itself for a difficult year. Cutting losses and attaching some rockets to flat revenues means change must happen for the digital twin specialist.

August 7, 2024
Harvey is an experienced property journalist and copywriter. He has written about the property industry since 2015, starting at The Property Franchise Group in the UK, before moving to Spain to work for Spotahome. He has blogged for the private rented sector, ghostwritten for UK property experts and written case studies for franchise owners around the UK. Harvey joined Online Marketplaces as a News Editor in 2022.

Subscribe to our mailing list to get the famous, free Friday newsletter!

News and analysis to help build better online marketplace businesses, in your inbox, every Friday

Related News

People Roundup 28Mar
People Roundup: Aviv Group, Pisos.com, Kleinanzeigen, REA India, Anjuke

There have been several high profile C-suite moves in this week's People Roundup. We'll start in Europe...   Europe: Aviv...

Read More
Product Update 2025Mar28 1
Product and Services Roundup: Zoopla, ViewIt

This week's Product Roundup starts in the UK, where it's all about Zoopla...   UK: Zoopla's MyHome product is used...

Read More
Ten Questions With Hiizzy 2
Ten Questions with Allan Wood and Lewis Buckley, Co-Founders at Hiizzy

"In the UK, a £500,000 sale at 1% is a commission of £5,000. With Hiizzy, you will not pay more...

Read More
Nar 1 3
NAR Amends Clear Cooperation Policy After Months of Speculation

The National Association of Realtors (NAR) has amended the terms of its Clear Cooperation Policy (CCP) after months of speculation...

Read More

Editor's Pick