Rising agency fees boost Rightmove revenues 

An increase in agents, fees and rising take-up of its extra packages contributed to a 6% annual rise in average revenue per advertiser (ARPA) for Rightmove during the first half  of the year.

A stock market update from the portal showed agency ARPA increased by £76 to £1,417 and membership numbers were up 2% on 31 December 2023, ending the first half of 2024 at 16,193 branches - mainly driven by lettings agents.

New Homes developments totalled 2,868, up from 2,946 at the end of last year.

Rightmove said agency revenue increased by £9.1m year-on-year to £138.5m, “as core membership price increases were secured through partner contract-renewals and agents continued to purchase additional products.”

The portal said 36% of its agent partners are now on its top Optimiser package, while use of its Local Valuation Alert vendor lead product increased by 8%.

Rightmove said it makes up 86% of the market and recorded 8.3bn minutes spent on the platform in the first half of 2024.

This contributed to a 7% annual rise in revenue for the period to £12.6m, while operating profit was up 2% annually to £131.6m.

Underlying profit was up just 1% to £135.1m, attributed to one-off acquisition costs of £0.6m relating to HomeViews and the strategic long-term investment in Coadjute.

Johan Svanstrom, chief executive of Rightmove, said: "Our performance came against the backdrop of the sustained challenging mortgage rate environment. The period saw a pick-up in existing-homes listings and transactions, a continued yet softening imbalance of demand and supply for rentals, and a tentative outlook for new homes development volumes. 

“With the election now concluded, the property market looks forward to potential interest rate reductions which will further stimulate activity.

"On the back of our leading position in the market, we have exciting momentum expanding our products and innovation for consumers and partners and remain confident in Rightmove's long-term prospects."

Analysts said the results were “solid but uninspiring.”

Charlie Huggins, manager of the quality shares portfolio at Wealth Club, said: “Despite the significant challenges facing the housing market, it has again grown revenue and profit, underlining the resilience of its business model.

"However, underlying operating profit only grew by 1%. This reflected some one-off costs, but it also reflects the need for Rightmove to step-up investment in innovation.”

Huggins highlighted that CoStar's acquisition of OnTheMarket means Rightmove now faces a “highly credible and deep-pocketed rival.”

He said: “Innovation is becoming increasingly important and that comes at a cost. 

“Rightmove still retains a very dominant position, and it will be difficult for CoStar to make a significant dent. Even without much growth, Rightmove is still a cash cow. But with the competitive environment hotting up, Rightmove cannot afford to rest on its laurels."

https://www.investegate.co.uk/announcement/rns/rightmove--rmv/half-year-report-replacement/8333380