Rich Barton Out, Jeremy Wacksman In as Zillow CEO

With a sixth consecutive quarterly loss in the books, Zillow is swapping out its CEO.

Rich Barton is stepping down as chief executive and being replaced by Zillow’s chief operating officer, Jeremy Wacksman, the firm announced Wednesday.

Barton will now join his co-founder, Lloyd Frink, as co-executive chair, and will advise Wacksman and other leaders at the company.

“I’m not going anywhere. I’m not doing anything else, but I’m really excited to be moving to a role of coach and adviser rather than the field general,” Barton said.

It’s the second time Barton has stepped down as CEO. His first stint ended in 2010, six years after the company’s founding. He began his second stint as chief executive in 2019 as the company built its iBuying business, which failed miserably and shuttered in 2021.

Wacksman joined Zillow from Microsoft in 2009 and has served in multiple roles across the company, including as chief marketing officer. He was promoted to chief operation officer three years ago.

“Oftentimes when there’s a leadership change, there’s a ‘what’s going to change?’ question. And the answer is, not much,” Wacksman said. “We’re going to focus on continuing to actually deliver, scale and accelerate this into the future.”

News of the shakeup came just an hour before Zillow discussed second-quarter results. The company logged another quarter without a profit, though it narrowed its losses from the previous year. Zillow lost $17 million last quarter, an improvement from $35 million of red ink in the second quarter of 2023.

Wacksman is taking the reins as low inventory of for-sale homes and higher mortgage rates continue to constrain the housing market.

The industry is also facing sweeping rule changes as part of the National Association of Realtors’ nationwide antitrust settlement, though Zillow, which is not a party to the lawsuit, maintains that it’s well positioned to weather the storm.

“We, and our partners, are the outside beneficiaries of these changes,” Wacksman said on the earnings call. “We think we will be caretakers in any future evolution or dispersion of the industry.”

The settlement requires buyer’s agents to obtain a signed agreement before bringing clients to tour a home. In response, Zillow launched a limited touring agreement earlier this year. The agreement allows agents to bring buyers to showings for seven days without an obligation to compensate them or work with them exclusively beyond the specified period.

The firm’s adjusted EBITDA — earnings before interest, taxes, depreciation and amortization — was $134 million, up from $111 million in the same period last year. It also posted a 13 percent year-over-year increase in revenue — from $506 million to $572 million.

The company attributed that growth in part to its rental segment. Revenue from rentals, which it said accounts for 20 percent of total revenue, grew nearly 30 percent last quarter. Zillow’s active rental listings were up 16 percent year-over-year.

The company also reported a 42 percent annual increase in revenue from its mortgage arm.

Zillow’s Flex program for agents, which urges participants to refer clients to the company’s mortgage lending segment, is drawing scrutiny from competitors and industry experts, The Information reported on Wednesday.

Critics told the publication that Zillow’s tapping agents to build its mortgage business could run afoul of laws prohibiting lenders from giving kickbacks to agents for directing buyers to them.

In terms of digital traffic, Zillow remains firmly in the lead as Homes.com and Realtor.com duke it out. The company reported more than 230 million average monthly unique visitors across its websites and applications and claimed users rely on the Zillow app three times more than others in the same category.