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Rightmove shares tumble after £60m AI investment plan
Shares in property portal Rightmove plunged by as much as 28% on Friday after the company announced a £60 million investment in artificial intelligence (AI) over the next three years, prompting revised profit forecasts and investor skepticism.
Revised profit outlook
The company lowered its operating profit growth forecast for 2026 to between 3% and 5%, down from the 9% growth projected for this year. Rightmove attributed the adjustment to increased AI spending and other strategic investments aimed at long-term returns.
Despite the near-term impact, the firm expects its operating profit to rebound after 2028, with annual revenue growth targeting over 10% by 2030.
CEO defends AI push
Chief Executive Johan Svanstrom described AI as "absolutely central" to Rightmove's future, emphasizing its role in driving innovation for partners and consumers. "We are already working on a wide range of exciting AI-enabled innovations," he said in a statement.
"Investing for future growth is not a bad thing, but the scale of the market's negative reaction implies real skepticism about its decision to put so much money into AI."
Russ Mould, Investment Director, AJ Bell
Market reaction
Shares initially dropped 28% in early trading before partially recovering, closing 12.5% lower. Analysts noted that while AI could improve efficiency and user experience, investors questioned whether Rightmove was overcommitting to a trend rather than a proven strategy.
"It's possible to see how AI might help Rightmove operate more efficiently and enhance user experience," Mould added. "However, there is clearly concern that Rightmove is jumping on the bandwagon."
Long-term strategy
Svanstrom remained confident, stating the investment would "create an even stronger platform and higher-growth business over time." The company plans to focus on leveraging AI to optimize data usage and streamline operations.
