Overview
- With a standstill agreement expiring on Jan. 27, Third Point said it will nominate directors to replace a majority of CoStar’s eight-member board.
- Third Point’s letter accuses CoStar of sinking roughly $3 billion into Homes.com for minimal returns, urges strategic alternatives for the residential unit, and blasts CEO Andy Florance’s pay and oversight.
- CoStar responded that shareholder-engagement drove board refreshes, creation of a Capital Allocation Committee, a new independent chair, and a redesigned 2026 executive compensation program.
- The company detailed cuts to Homes.com spending—reducing net investment by $300 million in 2026 and at least $100 million annually thereafter—alongside an accelerated $500 million buyback in 2025 and a new $1.5 billion program starting July 2026, while citing a 337% subscriber increase since Q1 2024 and targeting breakeven exiting 2029.
- Industry analysts say divesting Homes.com would be complex given shared infrastructure across CoStar’s platforms, and some expect the company to keep building the portal, noting that any AI-driven product update remains an analyst prediction.