CarGurus(CARG) - 2024 Q2 - Quarterly Results

Revenue Performance - Q2'24 Marketplace revenue increased by 14% year-over-year, marking the third consecutive quarter of double-digit growth[3] - Total revenue for Q2'24 was $218.7 million, a decrease of 9% compared to the prior year[5] - U.S. Marketplace Segment Revenue reached $180.1 million, reflecting a 14% increase year-over-year[7] - U.S. Marketplace revenue increased to $180.1 million in Q2 2024, up 13.6% from $158.4 million in Q2 2023[22] - Digital Wholesale Segment Revenue decreased by 66% to $23.5 million in Q2'24[7] - The digital wholesale segment reported a revenue drop to $13.1 million in Q2 2024, down 59% from $32.0 million in Q2 2023[21] - Third quarter 2024 guidance estimates total revenue between $212 million and $232 million[9] Profitability and Loss - Consolidated GAAP Net Loss for Q2'24 was $68.7 million, while Non-GAAP Adjusted EBITDA was $55.6 million, up 23% year-over-year[3][5] - The company reported a net loss of $68.7 million for Q2 2024, compared to a net income of $16.4 million in Q2 2023[21] - Consolidated net loss for the three months ended June 30, 2024, was $(68,721) thousand, compared to a net income of $13,817 thousand for the same period in 2023[25] - Non-GAAP consolidated net income for the three months ended June 30, 2024, was $42,732 thousand, compared to $33,848 thousand for the same period in 2023, reflecting a 26% increase[26] - Non-GAAP EPS guidance for Q3 2024 is projected to be between $0.38 and $0.44[9] Operating Expenses - Operating expenses surged to $276.0 million in Q2 2024, significantly higher than $146.4 million in Q2 2023, primarily due to goodwill impairment[21] - The company reported a total operating expense of $424.705 million for the three months ended June 30, 2024, down from $455.793 million in the previous year[39] - Goodwill and other long-lived asset impairment for the three months ended June 30, 2024, was $127,655 thousand, significantly higher than the $9 thousand reported in the same period of 2023[25] - Stock-based compensation expense for the three months ended June 30, 2024, was $15,557 thousand, slightly up from $14,602 thousand in the same period of 2023[26] Cash Flow and Liquidity - Cash and cash equivalents decreased to $216.2 million as of June 30, 2024, down from $291.4 million at the end of 2023[19] - The company reported a net decrease in cash, cash equivalents, and restricted cash of $(30,763) thousand for the three months ended June 30, 2024[25] - Cash, cash equivalents, and restricted cash at the end of the period stood at $218,365 thousand, down from $374,621 thousand at the end of the same period in 2023[25] - Net cash provided by operating activities increased to $71,597 thousand for the three months ended June 30, 2024, up from $29,336 thousand in the prior year, representing a 143% increase[25] - Non-GAAP free cash flow for the three months ended June 30, 2024, was $40.371 million, up from $23.536 million in the same period last year[41] Assets and Liabilities - Total assets decreased to $753.3 million as of June 30, 2024, from $918.9 million at the end of 2023, indicating a decline of 18%[19] - Total current liabilities were $112.0 million, slightly down from $115.2 million at the end of 2023[19] - The company’s retained earnings decreased to $306.7 million as of June 30, 2024, from $354.1 million at the end of 2023[20] User Engagement and Metrics - International Average Monthly Unique Users increased by 21% to 8.9 million[7] - The average revenue per subscribing dealer (QARSD) is a key metric for evaluating the value proposition of marketplace products, reflecting the company's sales and marketing success[49] - Average monthly unique users are a key indicator of user experience, advertising effectiveness, and brand awareness, calculated based on Google Analytics data[51] - Average monthly sessions are defined as distinct visits to the websites, indicating consumer satisfaction and engagement, also measured by Google Analytics[52] - Transactions in the Digital Wholesale segment represent the number of vehicles processed through the CarOffer website, providing insight into growth and revenue for this segment[53] - Growth in Transactions is a significant metric, demonstrating consumer and dealer utilization and market share penetration in the Digital Wholesale segment[53] Financial Reporting and Transparency - The company aims to enhance its operational decision-making by providing non-GAAP financial measures, which exclude certain expenses for clearer insights into performance[42] - The company has updated its financial disclosures to separately report stock-based compensation expenses for CarOffer, LLC Units for better transparency[39] - The company defines Free Cash Flow as cash flow from operations minus purchases of property and equipment and capitalization of website development costs, indicating financial performance after necessary expenditures[49]