Rightmove was the FTSE 100’s best performer in early trading on Monday after the property portal said they were increasing guidance for key revenue metrics as new products show signs of promise.
The UK’s largest property portal now expects average revenue per advertiser (ARPA) to hit £112-116, exceeding previous guidance of £103-£105. The upgrade comes as overall revenue growth continues tracking ahead of expectations at 8-10%.
Rightmove shares were 5% higher at the time of writing.
Demand from new home developers for Rightmove’s advertising products has driven the majority of ARPA growth. Estate agents continue to use mix of Rightmove’s branding and lead-generation offering.
Despite broader uncertainty in the housing market, Rightmove’s market share and network effect continue to support growth. Underlying operating profit is now seen climbing 7-8% for the year.
The portal’s resilient performance has been seen since amid issues weighing on the property market, and investors will be encouraged by the upgrades to ARPA even as UK transactions slip.
Rightmove was also upbeat on non-core activities like commercial real estate. The group’s fledgling mortgages remains on track to meet targets and last week saw the launch of Rightmove’s first mortgage broker offering.
Johan Svanstrom, CEO of Rightmove commented on the results:
“The momentum that we reported in July has continued through the third quarter and beyond. The strength of our performance against an uncertain market backdrop demonstrates the strength of the UK consumer affinity to our platform, the value of the established network effect of our business model, the depth and richness of our consumer data, and the value that our customers place in our products to build their businesses.”
“It also illustrates the resilience of our business model in all phases of the property market cycle. We continue to look to the future with confidence and remain focused on the delivery of our strategic plans, both in our core business and in strategic growth areas. We look forward to providing more detail at this afternoon’s investor day about our plans to capitalise on the significant growth opportunities ahead.”
