Rightmove Shares Plummet 28% Over AI Investment Plans

TL;DR: Rightmove shares dropped up to 28% after announcing £60m AI investment plans over three years, with operating profit growth forecasts cut from 9% to 3-5% for 2026. Markets reacted negatively despite the company’s long-term growth strategy targeting 10% annual revenue growth by 2030.

UK property platform Rightmove experienced significant market turbulence after revealing ambitious artificial intelligence investment plans. Chief Executive Johan Svanstrom described AI as “becoming absolutely central” to the business, but investors responded with scepticism, sending shares tumbling by more than a quarter in early trading.

Investment Strategy and Market Reaction

The company plans to invest £60m over the next three years, with a substantial portion allocated to AI-enabled innovations. However, this commitment comes at the cost of near-term profitability, with operating profit growth projections for 2026 revised down to 3-5%, compared to anticipated 9% growth in the current year.

Rightmove expects the AI investment to deliver returns after 2028, with revenue growth targets exceeding 10% annually by 2030. The company is already developing a range of AI-enabled features aimed at benefiting both property partners and consumers.

Market Scepticism

Investment analysts expressed concern about the scale of the investment. Russ Mould, investment director at AJ Bell, suggested the sharp market reaction indicated “real scepticism” about the AI spending level. While acknowledging AI’s potential for operational efficiency and enhanced data utilisation, Mould noted concerns that Rightmove might be “jumping on the bandwagon” with its AI commitments.

Looking Forward

Despite initial market turbulence—shares recovered somewhat to close 12.5% lower—Rightmove remains confident in its strategic direction. Svanstrom emphasised that the investment would “create an even stronger platform and higher-growth business over time.”

The company’s willingness to sacrifice short-term profitability for AI transformation reflects broader industry trends, though market reaction suggests investors remain cautious about AI investment promises without proven returns.

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