CarGurus Announces Second Quarter 2025 Results & Shares Plans to Wind Down CarOffer Transactions Business

Core Insights - CarGurus reported a strong performance in its Marketplace business, with revenue increasing by 14% year-over-year in Q2 2025, reaching $222 million [1][4] - The company achieved a net income of $22.3 million for Q2 2025, with a Non-GAAP Adjusted EBITDA of $77.3 million, reflecting a 39% increase year-over-year [1][4] - The Board of Directors approved an additional $150 million share repurchase program, raising the total authorization for 2025 to $350 million, which will extend through July 2026 [1][4] Financial Performance - Total revenue for Q2 2025 was $234 million, a 7% increase from the previous year, while total revenue for the first half of 2025 was $459.2 million, up 6% year-over-year [4][25] - Gross profit for Q2 2025 was $204.4 million, representing a 12% increase year-over-year, with a gross margin of 87% [4][25] - Operating expenses decreased by 35% in Q2 2025, totaling $179.5 million, contributing to improved profitability [4][25] Business Strategy - The company plans to wind down its CarOffer transactions business, focusing instead on enhancing technology and analytics to support smarter sourcing decisions [2][11] - CarGurus aims to continue delivering AI-powered inventory intelligence and consumer vehicle sourcing at scale through its existing platforms [11][12] - The wind-down of CarOffer is expected to incur costs between $14 million and $19 million, primarily in the second half of 2025 [12][13] Key Performance Indicators - The number of U.S. paying dealers increased by 4% to 25,478, while international paying dealers rose by 10% to 7,617, resulting in a total of 33,095 paying dealers, a 6% increase [5] - U.S. average monthly unique users reached 34.1 million, with average monthly sessions at 84.6 million [5] - The U.S. Marketplace segment revenue was $202.7 million, up 13% year-over-year, while the digital wholesale segment revenue decreased by 49% [5][27] Guidance - For Q3 2025, CarGurus expects Marketplace revenue to be between $228 million and $233 million, with Non-GAAP earnings per share projected between $0.50 and $0.58 [7][8] - The guidance reflects management's expectations based on current market trends and industry conditions [8][9]