(Reuters) -CoStar Group said on Tuesday it was no longer in talks to buy Realtor.com owner Move Inc from News Corp and forecast disappointing first-quarter revenue that sent its shares down 15% in extended trading.Â
Reuters reported last month that News Corp was exploring a sale of Move Inc to CoStar, which provides online marketplaces for commercial and residential real estate and apartment rentals, among others.
Reports of the deal talks emerged in late January, as Rupert Murdoch withdrew his proposal to unite Fox Corp with News Corp. The potential $3 billion sale of Move was greeted with enthusiasm by investors, who viewed News Corp’s digital real estate assets as undervalued.
News Corp issued a statement on Tuesday saying it would keep looking for ways to “optimize the value” of its digital real estate services segment, which also includes the REA Group in Australia.
It has been a tough time for the housing market, which witnessed a boom during the pandemic, as inflation-wary people are spending less on real estate.
Sales of existing U.S. homes dropped to the lowest level in more than 12 years in January, though the pace of decline slowed.
Apartments.com owner CoStar said it expected revenue between $575 million and $580 million for the first quarter. That compared with analysts’ average estimate of $585.62 million, according to Refinitiv data.
Excluding certain items, CoStar expects full-year net income of $1.06 to $1.09 per diluted share, compared with the average analyst estimate of $1.47.
Stephens analyst John Campbell said CoStar’s profit forecast was the main reason the company’s stock was down so much.
On an adjusted basis, CoStar earned 38 cents per share in the fourth quarter, compared with analysts’ average estimate of 36 cents. It posted revenue of $573 million, just below the average analysts’ estimate of $576 million.
(Reporting by Tiyashi Datta in Bengaluru, Dawn Chmielewski in Los Angeles; Editing by Shinjini Ganguli and Bradley Perrett)