REA Group Ltd (ASX: REA) shares are falling on Thursday morning.

At the time of writing, the real estate listings company's shares are down 4% to $241.39.

This follows the release of the realestate.com.au owner's half year results.

REA Group shares fall on results day

• Revenue up 20% to $873 million
• Operating expenses up 18% to $338 million
• EBITDA up 22% to $535 million
• Net profit up 26% to $314 million
• Fully franked interim dividend up 26% to $1.10 per share
• CEO to retire

What happened during the half?

For the six months ended 31 December, REA posted a 20% increase in revenue to $873 million. This reflects strong growth in both Australia and India.

In the Australia segment, management revealed that Residential revenue increased 21% to $614 million. It notes that Buy revenue growth was driven by a 14% increase in Buy yield and a 5% increase in national listings.

Buy yield benefited from a 10% average Premiere+ price rise, increased Premiere+ and total depth penetration, and growth in add-ons including Audience Maximiser and Luxe. This was offset by a small negative impact from geographical mix.

REA's CEO, Owen Wilson, revealed that its realestate.com.au website continues to dominate the market. He said:

Realestate.com.au is the premier destination for customers to connect with Australia's largest audience of buyers and sellers. More people turned to our platform in the half than ever before, with 5.1 million more Australians visiting realestate.com.au every month on average compared to our nearest competitor. Our personalised consumer experiences supported a 13% year-on-year increase in our unique audience lead and helped drive exceptional year-on-year growth in the number of seller leads delivered to customers.

Over in India, the REA India business delivered a 46% increase in revenue to $64 million. Management notes that revenue from adjacent services on Housing Edge increased 153%, driven by increased customer acquisition and usage.

Housing.com revenue was up 15%, continuing to benefit from stronger customer events and improved monetisation in Tier 2 cities, with yield growth slowing in a competitive market. However, PropTiger revenues declined by 26%, reflecting reduced volume of stock and lower commission rates in the strong property market.

Profits jump

Thanks to a combination of strong top line growth and slower costs growth, REA reported a big jump in profits for the half.

The company revealed a 22% increase in EBITDA to $535 million and a 26% jump in net profit to $314 million.

This allowed the REA board to declare an interim dividend of $1.10 per share, which is up 26% on the prior corresponding period.

How does this compare to expectations?

The consensus estimate was for revenue of $855 million, EBITDA of $516 million, and net profit of $307 million.

As you can see above, the company has outperformed all three metrics with today's result.

While this would be expected to boost REA shares higher, some big news appears to have overshadowed this.

CEO exit

In a separate announcement, the company revealed that its CEO Owen Wilson has informed the board of his intention to retire in the second half of 2025. This follows 10 years with REA and 6 years as CEO.

The REA board advised that it has initiated a comprehensive process to select a new CEO and will be evaluating both internal and external candidates. Mr Wilson will remain with the business to ensure a smooth and orderly transition.

Commenting on his exit, Wilson said:

It has been a privilege to lead REA Group for the past six years and I am proud of all our team has accomplished. The business is in excellent shape as evidenced by the results we have announced today. We have an exciting strategy and a talented and committed team to deliver it.

Outlook

The company has had a solid start to the second half and expects more of the same in the coming months.

As a result, it continues to expect double-digit FY 2025 residential Buy yield growth. Though, it warns that the "magnitude of growth may be impacted if the negative drag from geographical mix continues across the remainder of the year."

It is also continuing to target positive operating jaws in FY 2025. However, low double-digit group core operating cost growth is now anticipated, compared to high single-digits previously.

REA shares are up 35% over the past 12 months.