TrueCar(TRUE) - 2025 Q1 - Quarterly Results

Financial Performance - Total revenue for Q1 2025 was $44.8 million, representing a year-over-year increase of $3.8 million (+9.2%) [5] - Net loss increased to -$10.1 million, compared to -$5.8 million in the same period last year [5] - Adjusted EBITDA decreased to -$3.8 million from $0.9 million in the same period last year [5] - Revenue for Q1 2025 was $44.8 million, a 9.2% increase year-over-year from $41.1 million in Q1 2024, but a 3.0% decrease from $46.2 million in Q4 2024 [54][60] - Net loss for Q1 2025 was ($10.1 million), compared to ($5.8 million) in both Q1 2024 and Q4 2024 [54][56] - Adjusted EBITDA for Q1 2025 was ($3.8 million), down from $0.9 million in Q1 2024 [54][56] - Total costs and operating expenses increased to $56,008 thousand, up 15.4% from $48,537 thousand year-over-year [102] - Net loss for the period was $10,136 thousand, compared to a net loss of $5,848 thousand in the same quarter of the previous year, representing a 73.0% increase in losses [102] - Adjusted EBITDA for the three months ended March 31, 2025, was $407 thousand, a significant improvement from a loss of $3,802 thousand in the same period of 2024 [107] Sales and Market Performance - New unit sales volume increased by 23% year-over-year, significantly outpacing the industry's growth of 6.8% in new vehicle retail sales for the quarter [5] - Total units sold in Q1 2025 were 86,000, a 9.3% increase year-over-year but a 7.7% decrease sequentially [70] - Total dealer revenue grew by $4.8 million (+13.3%) year-over-year, driven by a $1.7 million (+6.2%) increase in franchise dealer revenue [61] - OEM revenue for Q1 2025 was $3.8 million, a decline of $1.1 million (-22.4%) year-over-year [62] - Approximately one-third of the pilot dealer group's TrueCar-enabled sales were driven by TC+ consumers completing transactions online [3] Inventory and Financing - The average new vehicle inventory reached 2.7 million units, a decrease of 198 thousand units (-6.7%) quarter-over-quarter but an increase of 248 thousand units (+9.9%) year-over-year [25] - The average APR for new vehicle loans increased to 6.9% in Q1 2025, up from 6.6% in Q4 2024 [16] - The 25% tariffs on imported vehicles are estimated to add approximately $4,500 in additional costs per new vehicle sold in the US, equating to roughly 10% of the average pre-tariff new vehicle MSRP [7] Expenses and Cash Flow - Technology and development expenses totaled $8.1 million in Q1 2025, up 0.0% year-over-year [75] - General and administrative expenses were $10.1 million on a GAAP basis, up 6.3% YoY, and $7.8 million on a non-GAAP basis, up 4.2% YoY in Q1 2025 [76] - Sales and marketing expenses were $25.0 million on a GAAP basis, up 13.3% YoY, and $24.5 million on a non-GAAP basis, up 14.5% YoY in Q1 2025 [81] - TrueCar.com acquisition expense was $4.3 million, down 19.8% YoY, while cost per sale for TrueCar.com units was $170, down 11.9% YoY [82] - Partner marketing spend was $9.2 million, up 21.4% YoY, driven by a 19.1% YoY growth in units attributed to the partner network [82] - Cash and equivalents as of March 31, 2025, were $98.0 million, with no debt [55][56] - The company ended Q1 2025 with $98.0 million in cash and equivalents, down from $133.7 million at the end of Q1 2024 [83] - Cash usage included a $4 million payment to former equity holders of Digital Motors and a $1.4 million one-time payment to American Express [83] - Free cash flow for the three months ended March 31, 2025, was $(10,570) thousand, compared to $4,146 thousand in the previous quarter, reflecting a significant decrease [110] - The company reported a net cash used in operating activities of $(7,895) thousand for the period, compared to $2,049 thousand in the same quarter of 2024 [110] Strategic Initiatives - The company aims to complete back-end integrations with two dealer management system providers by the end of July 2025 [6] - TrueCar aims to enhance its growth strategy by improving lead quality through artificial intelligence and machine learning [91] - The company is focused on developing and scaling its TrueCar+ product to allow dealers to sell more inventory online [91] - TrueCar's management will host a call on May 6, 2025, to discuss financial results and business developments [84] Asset and Liability Management - Cash and cash equivalents decreased to $98,026 thousand as of March 31, 2025, down from $111,835 thousand at the end of 2024, reflecting a decline of 12.3% [104] - Total assets decreased to $145,005 thousand as of March 31, 2025, down from $159,691 thousand at the end of 2024, a reduction of 9.2% [104] - Total liabilities decreased to $33,909 thousand, down from $41,554 thousand at the end of 2024, indicating a decline of 18.4% [104]