Highlights

  • REA Group reported FY2026 core Revenue of A$1,793 million, increasing 7%, while EBITDA before associates rose 12% to A$1,088 million.
  • Core net profit attributable to shareholders increased 15% to A$650 million, although reported profit declined 19% to A$552 million.
  • Australian residential revenue increased 12% to A$1,290 million, supported by 13% growth in Buy listing Yield despite unchanged national listing volumes.
  • Management expects FY2027 national Buy listings to remain flat or decline by a low-single-digit percentage, with continued growth in Advertising yields.

REA Group Limited (ASX:REA) is an Australian digital property advertising and services company operating residential and commercial property platforms, including realestate.com.au and realcommercial.com.au. Its operations also extend to Mortgage broking, property data and Digital Marketing services. The company's FY2026 financial performance reflected higher advertising revenue per listing, increased customer adoption of premium products and improved operating margins, despite limited growth in Australian residential property listings.

FY2026 Financial Performance Reflects Higher Advertising Revenue

REA Group reported core revenue of A$1,793 million for the financial year ended 30 June 2026, increasing 7% compared with FY2025.

Core EBITDA before associates increased 12% to A$1,088 million.

Net profit attributable to shareholders from core operations increased 15% to A$650 million, while core Earnings Per Share rose to A$4.93.

However, reported statutory net profit declined 19% to A$552 million.

The decline reflected a A$111 million Impairment associated with REA India and the non-recurrence of a A$117 million impairment Reversal recorded in FY2025.

Core results exclude certain non-recurring items, while statutory profit includes their accounting impact.

Australian Residential Advertising Supports Earnings Growth

REA's Australian operations generated revenue of A$1,712 million, representing an increase of 11%.

Australian Residential revenue increased 12% to A$1,290 million.

Buy advertising yield increased 13%, despite national Buy listing volumes remaining unchanged during FY2026.

The increase reflected a combination of higher advertising prices, premium product adoption and additional services purchased by customers.

An average 7% increase in Premiere+ advertising prices contributed to the result.

Revenue from rental advertising also increased, supported by an average 6% price rise and greater adoption of enhanced listing products.

However, rental listing volumes declined 1%.

The figures indicate that higher revenue per advertisement was a principal contributor to growth rather than increased listing volumes.

Property Listing Activity Remains Uneven

National residential Buy listing volumes were unchanged across FY2026, although quarterly activity varied.

Listings declined 8% in the first quarter and 3% in the second quarter.

Activity subsequently improved, with listings increasing 1% in the third quarter and 11% in the fourth quarter.

The late-year improvement contributed to annual volumes exceeding management's earlier expectations.

However, the beginning of FY2027 showed renewed moderation.

REA reported that national Buy listings declined 2% in July 2026.

Combined listings across Melbourne and Sydney decreased 16%, while Brisbane, Perth and Adelaide recorded a combined increase of 13%.

At its Annual General Meeting on 8 October 2026, the company confirmed that national new Buy listings declined 2% during the first quarter of FY2027.

These conditions highlight differences in housing market activity across Australian cities.

Audience Engagement Supports Premium Advertising Products

REA reported an average monthly audience of 12.7 million people on realestate.com.au during FY2026.

Average monthly visits reached 146.4 million, increasing 11%.

Monthly buyer enquiries increased 8% to approximately 2.5 million.

Properties tracked by owners increased 15% to 5.2 million, while seller leads rose 22%.

The company continued expanding premium listing products and digital advertising services.

These products allow agents and vendors to purchase additional exposure, enhanced presentation features and targeted promotional services.

Future advertising revenue will depend on customer adoption, property market activity and continued Demand for premium listing products.

Commercial Property and Financial Services Contribute Revenue

REA's Commercial and New Homes Business reported revenue of A$238 million, increasing 9%.

Commercial revenue benefited from an average 7% price increase, greater adoption of premium advertising products and a 2% rise in listings.

New Homes revenue increased alongside project listing activity and additional advertising services.

The Financial Services business generated revenue of A$114 million, increasing 11%.

Mortgage Choice settlements increased 13%, although higher broker payout rates partly offset the revenue benefit.

REA also acquired a 70% controlling interest in Simplicity Loans & Advisory in June 2026, expanding its exposure to commercial mortgage broking.

These businesses provide additional revenue sources beyond residential property advertising.

International Investments and Portfolio Changes

REA continued reviewing its international investments during FY2026.

The company announced the proposed sale of Housing.com, its remaining Indian operating business, to Aurum PropTech.

Under the transaction structure, REA India would retain a 24.9% interest in Aurum following completion.

The Australian group also maintained a 20% Equity Investment in Move, Inc., which operates a US property advertising platform.

Move reported revenue growth of 11% to US$610 million, while REA's share of its equity-accounted loss improved to A$14 million.

REA also consolidated Planitar, the developer of iGUIDE property visualisation technology, from October 2025.

These investments extend the group's activities into international property advertising, digital visualisation and associated services.

Operating Costs and Shareholder Returns

REA's Australian operating costs increased 7% during FY2026.

Expenditure reflected technology development, marketing activities and increased use of advertising services.

However, the Australian operating EBITDA margin increased to 66%, reflecting revenue growth exceeding the increase in operating expenses.

Free Cash Flow increased 17% during the year.

The company declared a fully franked final Dividend of A$1.73 per share.

Total FY2026 dividends reached A$2.97 per share, representing growth of 20%.

REA also completed an A$200 million on-market share buyback during FY2026.

FY2027 Guidance and Property Market Outlook

REA expects national new Buy listings to remain flat or decline by a low-single-digit percentage during FY2027.

Management anticipates low-double-digit growth in controllable residential Buy advertising yield, excluding geographic mix effects.

This expectation incorporates an 8% increase in Premiere+ prices and further adoption of additional advertising products.

Operating costs, excluding acquisitions, are expected to increase by a mid-single-digit percentage.

Including acquisitions, group operating costs are expected to increase by a mid-to-high-single-digit percentage on a continuing-business basis.

Management continues targeting Operating Margin expansion.

However, the outlook remains dependent on housing market conditions, customer advertising expenditure and product adoption.

Key Risks and Operational Challenges

Property listings: Reduced transaction activity may limit advertising volumes and revenue growth.

Advertising pricing: Continued yield growth depends on customer willingness to purchase higher-priced listing products.

Housing market conditions: Interest rates, affordability and buyer confidence may influence listing activity.

Operating expenses: Technology investment, marketing and acquisition-related costs may affect margins.

International investments: Portfolio transactions and equity-accounted investments may influence statutory earnings.

Technology competition: Digital advertising platforms and emerging AI tools may change customer expectations and industry competition.

Key Insights

REA Group's FY2026 results reflected increased core revenue and profitability, supported primarily by higher advertising yields and customer adoption of premium listing products.

However, national residential Buy listings remained unchanged, highlighting the importance of revenue growth per advertisement.

The FY2027 outlook indicates continued reliance on advertising yield growth, while property listing volumes, customer pricing decisions and operating cost management remain important factors.