Core Insights - The used-car market is moderating with an 8% drop in demand and a 6% decline in prices, indicating a shift towards stabilization in the automotive industry [1][3][5] Market Overview - The automotive industry is experiencing significant shifts across new, used, and electric vehicle sectors, establishing a new standard for pricing and consumer choice [3] - The average new-car price is stable at approximately $49,111, down 1.5% year over year, while new-car inventory levels have increased by 35% compared to 2023 [5][7] - Used cars have seen a 6% decrease in prices year over year, with the average cost at $28,910, reflecting a notable increase from $21,639 in April 2019 [5][7] Consumer Behavior - Consumers are experiencing fewer pressures to compromise on vehicle choices due to improved supply conditions, although total inventory still trails pre-pandemic levels by over a million units [5] - Demand for new electric vehicles (EVs) has increased by 10% year over year, despite a 5% reduction in new EV prices to an average of $62,927 [5][7] Inventory Trends - New-car inventory has increased significantly, while used inventory has slightly declined by 1.6% year over year, indicating ongoing challenges but also gradual stabilization [5][7] - The used EV market has seen a substantial 20% drop in prices, enhancing its appeal amid cost-conscious consumer behavior [5][7] Pricing Dynamics - The average used car in April 2024 had 59,693 miles, an increase of 4,360 miles compared to April 2019, with costs per 1,000 miles rising from $391 in 2019 to $484 in 2024 [5] - The price gap between luxury and mainstream used vehicles has narrowed, with luxury used trade-ins now commanding 78% more value than mainstream brands, down from 120% pre-pandemic [5][7] Seasonal Trends - In April, the top 10 most searched used cars experienced a seasonal price increase, with the Porsche 911 seeing the largest increase [6]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company's total assets decreased to $1.14 billion as of March 31, 2024, from $1.17 billion at year-end 2023, while total revenue increased to $180.2 million from $167.1 million year-over-year, but net income significantly dropped to $0.8 million from $11.5 million, primarily due to a large swing in 'Other (expense) income, net', with net cash provided by operating activities increasing to $33.5 million [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheet Summary (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Total Assets** | **$1,143,131** | **$1,172,449** | | Total current assets | $177,171 | $178,438 | | Goodwill | $146,104 | $147,058 | | Intangible assets, net | $647,302 | $669,167 | | **Total Liabilities** | **$661,681** | **$680,341** | | Long-term debt, net | $473,755 | $460,119 | | **Total Stockholders' Equity** | **$481,450** | **$492,108** | [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) Consolidated Income Statement Summary (in thousands, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | **Total Revenue** | **$180,176** | **$167,068** | | Dealer Revenue | $161,815 | $149,843 | | OEM and National Revenue | $15,307 | $13,543 | | **Operating Income** | **$12,744** | **$12,529** | | **Net Income** | **$784** | **$11,479** | | Diluted EPS | $0.01 | $0.17 | - The significant decrease in Net Income from **$11.5 million** in Q1 2023 to **$0.8 million** in Q1 2024 was primarily driven by a shift in 'Other (expense) income, net' from an income of **$8.2 million** to an expense of **$3.6 million**[11](index=11&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Cash Flow Summary (in thousands) | Cash Flow Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $33,468 | $28,141 | | Net cash used in investing activities | ($6,013) | ($5,371) | | Net cash used in financing activities | ($35,203) | ($35,647) | | **Net decrease in Cash and cash equivalents** | **($7,835)** | **($12,877)** | | Cash and cash equivalents at end of period | $31,363 | $18,838 | [Notes to the Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Consolidated%20Financial%20Statements) The notes detail the company's accounting policies, revenue streams, recent acquisitions, debt structure, and subsequent events, highlighting an 8% increase in Dealer revenue, details of the D2C Media acquisition, a contingent consideration liability of $56.2 million, and a significant debt refinancing subsequent to the quarter's end Disaggregated Revenue (in thousands) | Revenue Source | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Dealer | $161,815 | $149,843 | | OEM and National | $15,307 | $13,543 | | Other | $3,054 | $3,682 | | **Total Revenue** | **$180,176** | **$167,068** | - On November 1, 2023, the company acquired D2C Media Inc. and EZResults Inc. for **$79.8 million**, including a potential cash earnout of up to **CAD$35.0 million** treated as compensation expense[29](index=29&type=chunk)[31](index=31&type=chunk) - As of March 31, 2024, the company had a contingent consideration liability of **$56.2 million**, measured at fair value on a recurring basis using Level 3 inputs, arising from acquisitions and contingent on achieving certain financial or operational metrics[38](index=38&type=chunk)[40](index=40&type=chunk) - On May 6, 2024, the company amended and extended its Credit Agreement, resulting in a new **$350.0 million** Revolving Loan due in 2029, with **$80.0 million** borrowed on the new loan to pay off and extinguish existing Term Loan and Revolving Loan balances[61](index=61&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 8% year-over-year revenue growth to the D2C Media acquisition and strength in digital experience and marketplace revenue, with key operating metrics showing a 1% increase in dealer customers and a 5% increase in monthly average revenue per dealer (ARPD), while operating expenses rose 8% in line with revenue growth, driven by costs from the D2C acquisition and higher compensation, maintaining a strong liquidity position with $226.4 million available as of March 31, 2024 [Key Operating Metrics](index=22&type=section&id=Key%20Operating%20Metrics) Key Operating Metrics (Q1 2024) | Metric | Q1 2024 | Q1 2023 | % Change (YoY) | Q4 2023 | % Change (QoQ) | | :--- | :--- | :--- | :--- | :--- | :--- | | Traffic (in thousands) | 171,438 | 164,782 | 4% | N/A | N/A | | Average Monthly UVs (in thousands) | 28,332 | 28,478 | (1)% | N/A | N/A | | Dealer Customers | 19,381 | 19,186 | 1% | 19,504 | (1)% | | Monthly ARPD | $2,505 | $2,386 | 5% | $2,523 | (1)% | - The **5% YoY increase** in ARPD was primarily driven by the marketplace repackaging initiative and adoption of higher-tier packages, slightly offset by the inclusion of lower-ARPD customers from the D2C Media acquisition[81](index=81&type=chunk) - The company transitioned its traffic measurement from Adobe Analytics to RudderStack as of January 1, 2024, which contributed to the **4% increase** in reported Traffic[73](index=73&type=chunk)[75](index=75&type=chunk)[76](index=76&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Results of Operations Summary (in thousands) | Line Item | Q1 2024 | Q1 2023 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | **Total Revenue** | **$180,176** | **$167,068** | **$13,108** | **8%** | | Dealer Revenue | $161,815 | $149,843 | $11,972 | 8% | | OEM and National Revenue | $15,307 | $13,543 | $1,764 | 13% | | **Total Operating Expenses** | **$167,432** | **$154,539** | **$12,893** | **8%** | | **Operating Income** | **$12,744** | **$12,529** | **$215** | **2%** | | **Net Income** | **$784** | **$11,479** | **($10,695)** | **(93)%** | - Dealer revenue increased by **8% ($12.0 million)**, driven by the D2C Media acquisition, growth in digital experience revenue, and the marketplace repackaging initiative[86](index=86&type=chunk) - OEM and National revenue grew **13% ($1.8 million)** as OEMs increased spending to raise consumer awareness amid rising on-the-lot inventory[87](index=87&type=chunk) - General and administrative expenses increased by **25% ($4.6 million)**, primarily due to incremental costs from the D2C Media business, including compensation expense related to the D2C Media earnout[93](index=93&type=chunk) [Liquidity and Capital Resources](index=28&type=section&id=Liquidity%20and%20Capital%20Resources) - As of March 31, 2024, the company had total liquidity of **$226.4 million**, consisting of **$31.4 million** in cash and cash equivalents and **$195.0 million** available under its Revolving Loan[100](index=100&type=chunk) - Total outstanding debt was **$480.0 million** as of March 31, 2024, with an average interest rate of **6.6%**[101](index=101&type=chunk) - During Q1 2024, the company repurchased **0.5 million shares** for **$9.5 million** under its authorized **$200 million** share repurchase program[104](index=104&type=chunk) - The company expects to pay **$19.8 million** of contingent consideration and earnout amounts within the next twelve months, having paid **$7.8 million** for contingent consideration in Q1 2024[105](index=105&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that its exposures to market risk have not changed materially since December 31, 2023, as detailed in its Annual Report on Form 10-K - There have been no material changes in the company's market risk exposures since the end of the last fiscal year[117](index=117&type=chunk) [Item 4. Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that as of March 31, 2024, the company's disclosure controls and procedures were effective, with no material changes in internal control over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the period covered by the report[118](index=118&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal controls[120](index=120&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any pending or threatened litigation that would have a material adverse impact on its financial position, results of operations, or cash flows - According to management, the company is not currently involved in any legal proceedings that would have a material adverse impact on its financials[49](index=49&type=chunk)[123](index=123&type=chunk) [Item 1A. Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes from the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2023 - No material changes to the risk factors described in the company's 2023 Form 10-K have occurred[124](index=124&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During the first quarter of 2024, the company repurchased a total of 532,635 shares of its common stock for approximately $9.5 million, with approximately $110.2 million remaining available for future repurchases under the authorized program as of March 31, 2024 Issuer Purchases of Equity Securities (Q1 2024) | Period | Total Shares Purchased | Average Price Paid per Share | Maximum Value Remaining for Purchase (in thousands) | | :--- | :--- | :--- | :--- | | January 2024 | 135,250 | $17.75 | $117,324 | | February 2024 | 184,730 | $18.30 | $113,944 | | March 2024 | 212,655 | $17.47 | $110,229 | | **Total Q1** | **532,635** | **N/A** | **$110,229** | - The share repurchases are part of a three-year, **$200 million** program authorized on February 24, 2022[129](index=129&type=chunk) [Item 5. Other Information](index=32&type=section&id=Item%205.%20Other%20Information) During the fiscal quarter ended March 31, 2024, none of the company's directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement - No directors or officers adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the first quarter of 2024[130](index=130&type=chunk) [Item 6. Exhibits](index=34&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including the Fifth Amendment to the Credit Agreement and various officer certifications as required by the Sarbanes-Oxley Act - Key exhibits filed include the Fifth Amendment to the Credit Agreement, CEO and CFO certifications under Sarbanes-Oxley Sections 302 and 906, and Inline XBRL data files[132](index=132&type=chunk)

Cars.com Inc. (NYSE:CARS) Q1 2024 Earnings Conference Call May 10, 2024 9:00 AM ET Company Participants Catherine Chen - Vice President, Investor Relations Alex Vetter - Chief Executive Officer Sonia Jain - Chief Financial Officer Conference Call Participants Rajat Gupta - JPMorgan Tom White - Davidson Naved Khan - B. Riley Securities Gary Prestopino - Barrington Research Doug Arthur - Huber Research Marvin Fong - BTIG Operator Good morning, ladies and gentlemen and welcome to the Cars.com First Quarter 202 ...

Cars.com (CARS) reported $180.18 million in revenue for the quarter ended March 2024, representing a year-over-year increase of 7.8%. EPS of $0.01 for the same period compares to $0.17 a year ago.The reported revenue represents a surprise of +0.20% over the Zacks Consensus Estimate of $179.81 million. With the consensus EPS estimate being $0.08, the EPS surprise was -87.50%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine ...

Revenue and Growth - Total revenue for Q1 2024 was $180.2 million, an increase of $13.1 million, or 8%, compared to the prior year period[14]. - The company expects Q2 2024 revenue to be between $181 million and $183 million, reflecting year-over-year growth of 7% to 9%[17]. - Full-year revenue growth guidance is reaffirmed at 6% to 8%[8]. - Revenue for Q1 2024 was $180.2 million, an increase of $13.1 million or 8% year-over-year[42]. Net Income and Earnings - Net income for the quarter was $0.8 million, or $0.01 per diluted share, compared to net income of $11.5 million, or $0.17 per diluted share, in the prior year[15]. - Adjusted net income for Q1 2024 was $28.7 million, or $0.43 per diluted share, compared to $26.2 million, or $0.39 per diluted share, in the prior year[15]. - Net income for the three months ended March 31, 2024, was $784,000, compared to $11,479,000 for the same period in 2023, indicating a significant decline[64]. EBITDA and Operating Performance - Adjusted EBITDA for the quarter was $52.7 million, representing 29% of revenue, up $8.3 million year-over-year[13]. - Adjusted EBITDA for the quarter totaled $52.7 million, representing 29% of revenue, compared to $44.3 million or 27% of revenue in the prior year[55]. Expenses and Cash Flow - Total operating expenses for Q1 2024 were $167.4 million, compared to $154.5 million for the prior year period[5]. - Adjusted operating expenses for the quarter were $154.9 million, a $9.2 million increase compared to the prior year[43]. - Free cash flow for Q1 2024 totaled $27.5 million, up from $22.8 million in 2023[44]. - Net cash provided by operating activities was $33.5 million, compared to $28.1 million in the prior year[44]. - Net cash provided by operating activities increased to $33,468,000 from $28,141,000 year-over-year, reflecting a growth of approximately 19.5%[64]. Shareholder Actions - The company repurchased 0.5 million shares of its common stock for $9.5 million during the quarter[7]. Traffic and User Metrics - Average Monthly Unique Visitors ("UVs") were 28.3 million, compared to 28.5 million a year ago[4]. - Traffic ("Visits") reached 171.4 million, up 4% year-over-year[42]. - Dealer Customers totaled 19,381 as of March 31, 2024, a slight decrease from 19,504 as of December 31, 2023[54]. - Average Revenue Per Dealer (ARPD) grew 5% year-over-year to $2,505, driven by the 2023 Marketplace Repackaging initiative[54]. - Monthly Average Revenue Per Dealer ("ARPD") was $2,505, up 5% year-over-year[13]. Financial Position - Cash and cash equivalents at the end of the period were $31,363,000, down from $39,198,000 at the beginning of the period, representing a decrease of about 20.0%[64]. - Total assets decreased to $1,143,131,000 from $1,172,449,000, a decline of approximately 2.5%[68]. - Total liabilities decreased to $661,681,000 from $680,341,000, reflecting a reduction of about 2.8%[68]. - Accounts receivable increased slightly to $125,670,000 from $125,373,000, showing a marginal growth of 0.2%[68]. Investment and Debt - The company reported a net cash used in investing activities of $6,013,000, compared to $5,371,000 in the previous year, indicating an increase in investment outflows[64]. - Payments of long-term debt decreased to $10,000,000 from $18,750,000, a reduction of approximately 46.7%[64]. - The Company amended and extended its existing Credit Facility to a new $350 million Revolving loan maturing in May 2029[56]. Other Financial Metrics - The company incurred stock-based compensation expenses of $8,357,000, down from $9,797,000, reflecting a decrease of about 14.7%[64]. - Cash paid for income taxes increased to $1,168,000 from $96,000, a significant rise of approximately 1,116.7%[64].

Despite Inflation and Interest Rate Concerns, Half of Americans Are Planning Major Purchases in 2024 CHICAGO, April 16, 2024 /PRNewswire/ -- In its second annual Affordability Report released today, car-shopping marketplace Cars.com® (NYSE: CARS) reveals a retail environment that is more accessible to consumers than it has been for months, and in some cases, years. Cars.com's 2024 Affordability Report is a comprehensive, data-driven resource for cost-conscious car shoppers that offers insights into consumer ...

New Cars.com Utility Puts in Data from Over Two Million Vehicle Listings in the Hands of Consumers and Allows Them to Easily Track Their Vehicle's Value Over Time1 Your Garage Launches Alongside Dynamic 30-Second Ad and Engaging Social, Radio Content CHICAGO, April 2, 2024 /PRNewswire/ -- Car-shopping marketplace Cars.comⓇ (NYSE: CARS) unveils Your Garage, a powerful tool designed to provide car owners with the ability to track the value of their vehicle over time so they can make a more informed decision. ...

Over 1 Million Consumer Reviews Show Responsiveness, Accountability Are Keys to Delivering Excellent Dealership Experience CHICAGO, March 6, 2024 /PRNewswire/ -- Car-shopping marketplace and dealer reputation site Cars.com® (NYSE: CARS) — home to more than 13 million dealership reviews, the most industrywide — today unveiled the winners of its annual Dealer of the Year Awards (DOTY), presented annually to the top automotive dealers. Out of the more than 50,000 U.S. and Canadian auto dealers with profiles, 9 ...

Key PointsCars.com and Carvana delivered two distinctly different earnings reports that say more about each company's business model than its status as an investment. The latest reading on consumer sentiment was weaker than expected, throwing yet another curveball at the market. While both stocks present concerns, analysts give CARS stock more upside, but a rate cut or two could change that.  5 stocks we like better than CarvanaCars.com Inc. NYSE: CARS and Carvana Co. NYSE: CVNA are two different ways to pl ...

| --- | --- | |-------------------------|-------| | | | | | | | | | | | | | Fourth Quarter and | | | Full Year 2023 Earnings | | | February 22, 2024 | | | | | | | | Forward-looking Statements This presentation contains "forward-looking statements" within the meaning of the federal securities laws. All statements other than statements of historical facts are forwardlooking statements. These statements often use words such as "believe," "expect," "project," "anticipate," "outlook," "intend," "strategy," "plan ...