The REA Group Ltd (ASX: REA) share price is down by 10% after the property portal business announced its FY26 half-year result.
REA Group owns a number of property portals and other related businesses such as realestate.com.au, realcommercial.com.au, Mortgage Choice and PropTrack. International investments include Move, REA India and iGUIDE.
FY26 half-year result
Here are some of the highlights for the six months to 31 December 2025, showing year on year changes:
- Revenue rose by 5% to $916 million
- Operating expenses grew 3% to $347 million
- Underlying EBITDA (EBITDA explained) rose 6% to $569 million
- Net profit climbed 9% to $341 million
- Reported net profit dropped 24% to $336 million
- Interim dividend up 13% to $1.24 per share
- On-market share buyback of up to $200 million
What happened?
There were several drivers of the above numbers.
Firstly, the statutory net profit declined because last year’s result included a gain on the sale of its investment in PropertyGuru, whereas this result did not include that gain.
National buy listings in Australia declined by 6%, which REA Group said reflected strong volumes last year, as well as a two-speed market this year. Sydney and Melbourne listings were flat year on year.
Despite lower listings, residential revenue grew by 7% thanks to strong buy yield growth of 14%. In other words, price increases helped drive revenue. There was also double-digit revenue growth in the commercial & new homes, and financial services segments.
The company has been able to deliver such strong revenue growth thanks to its market position. It reported 12.7 million people visited the property portal each month on average, including a record 13.2 million in November, with 6.4 million people exclusively using realestate.com.au.
REA Group also said it’s accelerating its AI rollout. It reported that company-wide adoption of AI is “driving innovation and capability” with expanded consumer natural language search, a Q3 beta of conversational search through its OpenAI partnership and a rollout of a customer AI engagement program.
International
Within REA India, PropTiger was sold and Housing Edge was exited. The simplified business structure will allow the business to focus on the Housing.com portal. In Australian dollar terms, Housing.com revenue was flat at $26 million, though it increased 3% in constant currency terms. Total REA India revenue dropped 40% to $38 million.
Revenue from Move increased 10% to US$295 million, while iGUIDE revenue made $6 million of revenue (after consolidation from 1 October 2025) – on a like for like basis, it achieved revenue growth of 23%.
Outlook for the REA Group share price
The company points to population growth and strong employment supporting demand for the company’s services, which points to a positive future.
With the business down from a share price of above $260 less than six months ago, there seem to be some substantial investor worries about AI.
If potential buyers continue searching on realestate.com.au, with AI or not, then the company’s future still looks very positive. I think the REA Group share price sell-off has been overdone.
The international segment still looks positive, though the loss of momentum at REA India is disappointing. Hopefully it can turn around growth because there’s a lot of potential there.
REA Group is one of the ASX growth shares I’d be looking at during this period of instability.
