v3.25.0.1
Debt
 12 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
Debt Debt
The following table presents the carrying values of Zillow Group’s debt as of the dates presented (in millions):
December 31,
20242023
   Master repurchase agreements:
UBS AG(1)
$73 $45 
JPMorgan Chase Bank, N.A.(2)
72 40 
Atlas Securitized Products, L.P.(3)
— 8 
Total borrowings under credit facilities
145 93 
Convertible senior notes
2026 Notes(4)
— 496 
2025 Notes
418 504 
2024 Notes(5)
— 607 
Total convertible senior notes418 1,607 
Total debt$563 $1,700 
(1) Agreement was amended and renewed on September 6, 2024, increasing the total maximum borrowing capacity from $100 million to $150 million.
(2) Agreement was amended and renewed on May 2, 2024, increasing the total maximum borrowing capacity from $100 million to $150 million.
(3) Agreement expired on March 11, 2024 and was not renewed.
(4) The 2026 Notes were settled on December 18, 2024 and are no longer outstanding.
(5) The 2024 Notes matured on September 1, 2024 and are no longer outstanding.
Credit Facilities
We utilize master repurchase agreements to provide capital for Zillow Home Loans. The master repurchase agreements provide short-term financing between the issuance of a mortgage loan and when Zillow Home Loans sells the loan to an investor or directly to an agency. The carrying amounts of our master repurchase agreements approximate their fair values because of their short-term nature. The following table summarizes certain details related to our master repurchase agreements as of December 31, 2024 (in millions, except interest rates):
LenderMaturity DateMaximum Borrowing Capacity
Borrowings Outstanding
Available
Borrowing Capacity
Weighted Average Interest Rate
UBS AGSeptember 5, 2025$150 $73 $77 6.07 %
JPMorgan Chase Bank, N.AMay 1, 2025150 72 78 6.14 %
Total$300 $145 $155 
The following table summarizes certain details related to our master repurchase agreements as of December 31, 2023 (in millions, except interest rates):
LenderMaturity DateMaximum Borrowing Capacity
Borrowings Outstanding
Available
Borrowing Capacity
Weighted Average Interest Rate
UBS AG
October 9, 2024$100 $45 $55 7.08 %
JPMorgan Chase Bank, N.A.
May 30, 2024100 40 60 7.05 %
Atlas Securitized Products, L.P.
March 11, 202450 8 42 7.37 %
Total$250 $93 $157 
In accordance with the master repurchase agreements, the Lenders have agreed to pay Zillow Home Loans a negotiated purchase price for eligible loans, and Zillow Home Loans has simultaneously agreed to repurchase such loans from the Lenders under a specified timeframe at an agreed upon price that includes interest. The master repurchase agreements contain margin
call provisions that provide the Lenders with certain rights in the event of a decline in the market value of the assets purchased under the master repurchase agreements. As of December 31, 2024 and 2023, $151 million and $99 million, respectively, in mortgage loans held for sale were pledged as collateral under the master repurchase agreements.
Borrowings on the master repurchase agreements bear interest at a floating rate based on SOFR plus an applicable margin, as defined by the governing agreements. The master repurchase agreements include customary representations and warranties, covenants and provisions regarding events of default. As of December 31, 2024, Zillow Home Loans was in compliance with all financial covenants and no event of default had occurred. The master repurchase agreements are recourse to Zillow Home Loans, and have no recourse to Zillow Group or any of its other subsidiaries.
Convertible Senior Notes
Effective January 1, 2022, we adopted new guidance which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Upon adoption of the new accounting guidance, we recorded a decrease to additional paid-in capital, an increase to long-term debt and a cumulative-effect adjustment to accumulated deficit of $156 million.
The following tables summarize certain details related to our Notes as of the dates presented or for the periods ended (in millions, except interest rates):
December 31, 2024December 31, 2023
Maturity DateAggregate Principal AmountStated Interest RateEffective Interest RateFirst Interest Payment DateSemi-Annual Interest Payment DatesUnamortized Debt Issuance CostsFair ValueUnamortized Debt Issuance CostsFair Value
September 1, 2026$— 1.375 %1.57 %March 1, 2020March 1; September 1$— $— $3 $681 
May 15, 2025419 2.75 %3.20 %November 15, 2020May 15; November 151 486 3 560 
September 1, 2024— 0.75 %1.02 %March 1, 2020March 1; September 1— — 1 825 
Total$419 $1 $486 $7 $2,066 
Year Ended December 31, 2024Year Ended December 31, 2023Year Ended December 31, 2022
Contractual Coupon InterestAmortization of Debt Issuance CostsInterest ExpenseContractual Coupon InterestAmortization of Debt Issuance CostsInterest ExpenseContractual Coupon InterestAmortization of Debt Issuance CostsInterest Expense
2026 Notes$7 $1 $8 $7 $1 $8 $7 $— $7 
2025 Notes12 2 14 16 2 18 16 3 19 
2024 Notes3 1 4 5 2 7 4 2 6 
Total$22 $4 $26 $28 $5 $33 $27 $5 $32 
The 2025 Notes are senior unsecured obligations and are classified as current liabilities in our consolidated balance sheet based on their contractual maturity date. Interest on the 2025 Notes is paid semi-annually. The estimated fair value of the 2025 Notes is classified as Level 2 and was determined through consideration of quoted market prices in markets that are not active.
The 2025 Notes are convertible into cash, shares of Class C capital stock or a combination thereof, at our election, and may be settled as described below. They will mature on May 15, 2025, unless earlier repurchased, redeemed or converted in accordance with their terms. The following table summarizes the conversion and redemption options with respect to the 2025 Notes:
Maturity DateEarly Conversion DateConversion RateConversion PriceOptional Redemption Date
May 15, 2025November 15, 202414.8810$67.20 May 22, 2023
There were no conversions or repurchases of the Notes during the year ended December 31, 2022. See below for conversion and repurchase activity associated with the Notes during the years ended December 31, 2024 and 2023.
Settlement of 2024 Notes. The 2024 Notes matured on September 1, 2024. During the period from March 1, 2024 through the close of business on August 29, 2024, holders of the 2024 Notes elected to convert all outstanding 2024 Notes in accordance with the terms of the indenture. We settled these conversions with aggregate cash payments totaling $610 million, which included $608 million in principal repayments, $2 million for accrued interest and a nominal cash payment in lieu of fractional shares, and the issuance of 1.9 million shares of Class C capital stock.
In September 2024, we received 2.1 million shares of Class C capital stock from the settlement of the capped call transactions we entered into in connection with the issuance of the 2024 Notes. Under applicable Washington State law, the acquisition of a corporation’s own shares is not disclosed separately as treasury stock in the financial statements and such shares are treated as authorized but unissued shares. We record acquisitions of our shares of capital stock as a reduction to capital stock at the par value of the shares reacquired, then to additional paid-in capital until it is depleted to a nominal amount, with any further excess recorded to retained earnings. We recorded an offsetting increase to additional paid-in capital for the unwind of the capped call transactions.
2025 Notes. During the year ended December 31, 2024 and in accordance with our Repurchase Authorizations, we repurchased $88 million aggregate principal amount of the 2025 Notes through open market transactions for $89 million in cash, including accrued interest, resulting in a loss on extinguishment of debt of $1 million recognized in our consolidated statements of operations. During the year ended December 31, 2023 and in accordance with our Repurchase Authorizations, we repurchased $58 million aggregate principal amount of the 2025 Notes through open market transactions for $57 million in cash, including accrued interest, resulting in a gain on extinguishment of debt of $1 million recognized in our consolidated statements of operations. For additional information on the Repurchase Authorizations, see Note 12 under the subsection titled “Share Repurchase Authorizations.” On or after November 15, 2024, until the close of business on the second scheduled trading day immediately preceding the maturity date for the 2025 Notes, holders may convert the 2025 Notes at their option at the applicable Conversion Rate then in effect. Any conversions of the 2025 Notes will be settled on the maturity date.
Settlement of 2026 Notes. On October 8, 2024, we submitted notice to the trustee to exercise our right to redeem the remaining $499 million in aggregate principal amount of the 2026 Notes on December 18, 2024 (the “Redemption Date”). Holders of the 2026 Notes elected to convert $498 million of aggregate principal amount prior to the Redemption Date. We settled these conversions with aggregate cash payments totaling $498 million covering principal and cash in lieu of fractional shares, and the issuance of 4.5 million shares of Class C capital stock. In addition, on the Redemption Date, the Company redeemed the remaining $1 million in aggregate principal amount of 2026 Notes that had not been surrendered for conversion at a redemption price in cash equal to 100% of the principal amount of 2026 Notes not converted, plus accrued and unpaid interest on such 2026 Notes from September 1, 2024 to, but excluding, the Redemption Date.
In connection with the issuance of the 2026 Notes in September 2019, the Company entered into separate, privately negotiated capped call transactions. The following table summarizes certain details related to our outstanding capped call transactions as of December 31, 2024:
Maturity DateInitial Cap PriceCap Price Premium
September 1, 2026$80.5750 150 %
In connection with settling our 2026 Notes in December 2024, we elected to keep the associated capped call transactions outstanding. These capped call transactions will entitle us to shares of our Class C capital stock and/or cash upon their exercise in accordance with their terms, subject to earlier termination in certain circumstances. These capped call transactions have an Initial Cap Price per share, which represents a premium (“Cap Price Premium”) over the relevant historical closing price of our Class C capital stock on the Nasdaq Global Select Market, and is subject to certain adjustments under the terms of these capped call transactions. The capped call transactions do not meet the criteria for separate accounting as a derivative as they are indexed to our own stock. The capped call premiums paid have been included as a net reduction to additional paid-in capital within shareholders’ equity.