Dealers see strong engagement with 85% of vehicles selling above the guaranteed offer and auctions attracting 35+ bids on averageBUFFALO, N.Y., Aug. 19, 2025 (GLOBE NEWSWIRE) -- ACV (NYSE: ACVA), the leading digital automotive marketplace and data services partner for dealers and commercial partners, has scaled up its popular No Reserve Sale to four days each week, giving dealers on both sides of the auction more opportunities than ever to sell and source inventory in true $0 reserve auctions. The expanded ...

Financial Data and Key Metrics Changes - Q2 revenue was $194 million, representing a 21% year-over-year growth, with 210,000 vehicles sold, marking a 13% increase despite market deceleration [7][19] - Adjusted EBITDA was $19 million, at the midpoint of guidance, with a margin improvement of 520 basis points year-over-year [20] - Non-GAAP net income was also at the midpoint of guidance, with a margin increase of 430 basis points year-over-year [20] Business Line Data and Key Metrics Changes - Auction and assurance revenue accounted for 57% of total revenue, growing 20% year-over-year, reflecting 13% unit growth and an average revenue per unit (ARPU) of $523, which grew 6% [20] - Marketplace services revenue comprised 39% of total revenue, growing 25% year-over-year, driven by record revenue for ACV Transport and ACV Capital [21] - SaaS and data services products made up 4% of total revenue, with revenue approximately flat year-over-year [21] Market Data and Key Metrics Changes - The company observed a 300 basis point year-over-year increase in trade retention rates, indicating dealers are keeping more vehicles for retail purposes [87] - The overall market conditions are expected to be flat to slightly down for the full year, influenced by macroeconomic factors [65][87] Company Strategy and Development Direction - The company is focused on three pillars: growth, innovation, and scale, leveraging AI across its suite of solutions to enhance dealer experiences and optimize pricing [8][14] - The company is expanding its total addressable market (TAM) and competitive moat through innovative product offerings and partnerships, including a new commercial platform [17][28] - The strategy includes maintaining adjusted EBITDA guidance while investing in long-term growth objectives, with a commitment to significant margin expansion [6][26] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving strong top-line growth of at least 20% year-over-year despite ongoing macroeconomic challenges [5][25] - The company trimmed its 2025 revenue guidance by $5 million at the midpoint, now expecting revenue in the range of $765 million to $775 million [25][102] - Management noted that conversion rates improved in July, indicating a potential recovery in market conditions [24][38] Other Important Information - The company ended Q2 with $305 million in cash and cash equivalents and marketable securities, alongside $187 million of debt [23] - The company is excited about the upcoming launch of its first greenfield location in Houston, Texas, as part of its commercial platform strategy [17][116] Q&A Session Summary Question: Clarification on unit growth headwind - Management clarified that the 500 basis point unit growth headwind was due to lower conversion rates than anticipated, not solely due to higher retention rates [31][34] Question: Competitive dynamics in the marketplace - Management indicated that the slight dip in conversion rates was consistent across the industry, with both macroeconomic factors and company initiatives contributing to the trends [37][39] Question: Progress on pricing engine and auction liquidity - Management reported significant progress in their pricing engine, with guaranteed sales accounting for 15% of units sold by the end of Q2, indicating strong auction liquidity [44][47] Question: Outlook on Amazon partnership and AI solutions - Management stated that while they are investing in partnerships and AI solutions, they do not expect material contributions to revenue this year, focusing instead on long-term benefits [55][57] Question: Organic growth rate excluding acquisitions - Management noted that the recent acquisition contributed about 1% to dealer unit growth in the quarter, with organic growth remaining strong [114] Question: Commercial opportunities and greenfield locations - Management expressed excitement about their greenfield strategy, with plans for additional locations and a focus on organic growth rather than acquisitions [116][120]

Financial Data and Key Metrics Changes - Q2 revenue was $194 million, representing a 21% year-over-year growth, with 210,000 vehicles sold, marking a 13% increase despite market deceleration [7][19]. - Adjusted EBITDA was $19 million, at the midpoint of guidance, with a margin improvement of 520 basis points year-over-year [20]. - Non-GAAP net income was also at the midpoint of guidance, with a margin increase of 430 basis points year-over-year [20]. Business Line Data and Key Metrics Changes - Auction and assurance revenue accounted for 57% of total revenue, growing 20% year-over-year, reflecting 13% unit growth and an average revenue per unit (ARPU) of $523, which grew 6% [20]. - Marketplace services revenue comprised 39% of total revenue, growing 25% year-over-year, driven by record revenue for ACV Transport and ACV Capital [21]. - SaaS and data services products made up 4% of total revenue, with revenue approximately flat year-over-year [21]. Market Data and Key Metrics Changes - The company observed a 300 basis point year-over-year increase in trade retention rates, indicating dealers are keeping more vehicles for retail purposes [87]. - The overall market is expected to be flat to slightly down for the full year, influenced by macroeconomic factors and dealer behavior [65][87]. Company Strategy and Development Direction - The company focuses on three pillars for long-term shareholder value: growth, innovation, and scale [8]. - The strategy includes leveraging AI across solutions to enhance pricing accuracy and improve dealer engagement [8][14]. - The company is expanding its addressable market through new product offerings and partnerships, including a commercial platform and greenfield locations [17][118]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving strong top-line growth of at least 20% year-over-year despite macroeconomic challenges [5][25]. - The company trimmed its 2025 revenue guidance by $5 million at the midpoint, now expecting revenue in the range of $765 million to $775 million [25]. - Management noted that conversion rates improved in July, indicating a potential recovery in market conditions [24][38]. Other Important Information - The company ended Q2 with $305 million in cash and cash equivalents and $187 million in debt, reflecting a strong capital structure [23]. - The company is investing in its remarketing center strategy and commercial platform, expecting operating expenses to grow approximately 11% in 2025 [22][26]. Q&A Session Summary Question: Clarification on unit growth headwind - Management clarified that the 500 basis point unit growth headwind was due to lower conversion rates than anticipated, not solely due to higher retention rates [31][34]. Question: Competitive dynamics in the marketplace - Management indicated that the slight dip in conversion rates was consistent across the industry, with both macroeconomic factors and company initiatives influencing performance [37][39]. Question: Progress on pricing engine and auction liquidity - Management reported significant progress in their pricing engine, with guaranteed sales accounting for 15% of units sold by the end of Q2, indicating strong auction liquidity [44][47]. Question: Outlook on Amazon partnership and AI solutions - Management stated that while they are investing in partnerships and AI solutions, they do not expect material contributions to revenue this year, focusing instead on long-term benefits [55][57]. Question: Organic growth rate excluding acquisitions - Management noted that the recent acquisition contributed about 1% to dealer unit growth in Q2, with other acquisitions prior to Q2 last year not affecting organic growth [114]. Question: Commercial opportunities and greenfield locations - Management expressed excitement about their greenfield strategy, with the first location in Houston going live and plans for additional locations in the future [116][118].

Financial Data and Key Metrics Changes - Q2 revenue was $194 million, representing a 21% year-over-year growth, and the company sold 210,000 vehicles, which is a 13% increase year-over-year despite market deceleration [6][19][20] - Adjusted EBITDA was $19 million, at the midpoint of guidance, with a margin improvement of 520 basis points year-over-year [20][25] - Non-GAAP net income was also at the midpoint of guidance, with a margin increase of 430 basis points year-over-year [20] Business Line Data and Key Metrics Changes - Auction and assurance revenue accounted for 57% of total revenue, growing 20% year-over-year, driven by 13% unit growth and an average revenue per unit (ARPU) of $523, which increased by 6% [20] - Marketplace services revenue made up 39% of total revenue, growing 25% year-over-year, reflecting record revenue for ACV Transport and ACV Capital [20] - SaaS and data services products comprised 4% of total revenue, with revenue approximately flat year-over-year [21] Market Data and Key Metrics Changes - The company observed a 300 basis point increase in trade retention rates year-over-year, indicating dealers are keeping more vehicles for retail purposes [90] - Conversion rates decreased during the quarter but showed improvement in July, aligning with normal seasonal patterns [24][38] Company Strategy and Development Direction - The company focuses on three pillars for long-term shareholder value: growth, innovation, and scale, leveraging AI across its suite of solutions to enhance dealer experiences [5][7] - The company is expanding its total addressable market (TAM) and competitive moat through innovative product offerings and partnerships, including a new commercial platform [17][28] - The company is committed to maintaining adjusted EBITDA guidance while investing in long-term growth objectives, expecting a revenue growth of at least 20% year-over-year [5][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in executing a profitable growth strategy despite challenging market conditions, with expectations for strong top-line growth [4][6] - The company trimmed its 2025 revenue guidance by $5 million to reflect ongoing macroeconomic challenges, now expecting revenue in the range of $765 million to $775 million [25][106] - Management noted that while the market may be flat to slightly down, they anticipate returning to mid-teens market share gains in the future [64][90] Other Important Information - The company is excited about the upcoming launch of its first greenfield location in Houston, Texas, which will enhance its commercial platform capabilities [17][120] - The company is actively working on integrating new technology and data products to improve pricing accuracy and auction liquidity [42][46] Q&A Session Summary Question: Clarification on unit growth headwind - Management clarified that the 500 basis point unit growth headwind was due to lower conversion rates than anticipated, while dealers are retaining more vehicles [31][34][36] Question: Competitive dynamics in the marketplace - Management indicated that the slight dip in conversion rates was consistent across the industry, with improvements noted at the start of the current quarter [38][39] Question: Progress on pricing engine and auction liquidity - Management reported significant progress in their pricing engine, achieving a close estimate of vehicle sale prices, which enhances auction liquidity [42][45] Question: Amazon partnership and geographic expansion of AI tools - Management stated that while they are investing in partnerships and new capabilities, they do not expect material contributions from these initiatives in the current year [52][56] Question: Drivers of deceleration relative to the broader industry - Management emphasized that while growth has slowed, they remain confident in their ability to gain market share and expect a return to mid-teens growth [62][64] Question: Update on ClearCar and market success - Management highlighted strong performance from ClearCar, particularly in supply-constrained markets, and noted plans to integrate new features with their offerings [96][101]

Core Insights - ACV reported record revenue and Adjusted EBITDA for Q2 2025, driven by market share gains and strong adoption of Marketplace Services despite challenging market conditions [2][3] - The dealer wholesale market experienced modest year-over-year growth, with a deceleration in growth reflecting weakening retail demand [3] - The company updated its revenue guidance to account for macroeconomic challenges while maintaining its Adjusted EBITDA guidance midpoint [3] Financial Performance - Q2 2025 revenue reached $194 million, a 21% increase year-over-year, with Marketplace and Service Revenue at $176 million, up 22% [5][6] - GAAP net loss for Q2 2025 was $7 million, compared to a loss of $17 million in Q2 2024, while non-GAAP net income was $12 million, up from $3 million [6][25] - Adjusted EBITDA for Q2 2025 was $19 million, compared to $7 million in Q2 2024 [6][30] Guidance - For Q3 2025, ACV expects total revenue between $198 million and $203 million, representing a 16% to 18% year-over-year increase [5][6] - Full-year 2025 revenue guidance is set at $765 million to $775 million, indicating a growth of 20% to 22% year-over-year [5][6] Market Metrics - Marketplace GMV for Q2 2025 was $2.7 billion, a 12% increase year-over-year, with Marketplace Units at 210,429, up 13% [6][20] - The dealer wholesale market is anticipated to be flat to modestly down year-over-year in 2025, with expected normal seasonal patterns for conversion rates and wholesale price depreciation [12]

Core Viewpoint - ACV, a leading digital automotive marketplace, is set to report its second quarter 2025 financial results on August 11, 2025, after market close [1]. Group 1: Financial Reporting - The company will host a conference call at 5:00 p.m. ET on the same day to discuss the financial results [1]. - Investors and analysts can participate in the call by dialing the provided numbers approximately 10 minutes prior to the start [2]. Group 2: Company Overview - ACV aims to transform the automotive industry by creating trusted and efficient digital marketplaces and data solutions for used vehicles [3]. - The company's offerings include ACV Auctions, ACV Transportation, ACV Capital, ACV MAX, True360, and ClearCar [3].

Strategy and Mission - ACV's mission is to transform the automotive industry by building trusted and efficient marketplaces and data solutions for used vehicles [17] - ACV aims to maximize long-term shareholder value through growth, innovation, and scale [37] Market and Growth - ACV's total addressable market includes dealer wholesale (10M+ units), commercial wholesale (6M units), and data services (50M+ vehicles) [22] - ACV is focused on gaining dealer wholesale market share and executing on the commercial wholesale opportunity [36] - Major Account franchise sellers on ACV have increased 85% since 2020 [115] - ACV's territory expansion model focuses on regional penetration, with some territories achieving high franchise rooftop penetration, such as New Jersey Shore at 81% [98] Financial Targets and Performance - ACV projects revenue to reach $1.4 billion and adjusted EBITDA to reach $350 million in the mid-term [313] - ACV's 2024 revenue was approximately $637 million [20] - ACV achieved adjusted EBITDA profitability [20] - ACV's mid-term target assumes approximately 1.5 million units sold, with commercial wholesale comprising approximately 15% of the mix [324]

Summary of ACV Auctions (ACVA) FY Conference Call Company Overview - ACV Auctions operates as an online marketplace primarily facilitating dealer-to-dealer wholesale transactions, disrupting the traditional physical auction market [4][5] - The company went public four years ago and has achieved a market share of approximately 10% in a market where 85% remains physical [5][6] - Revenue has grown from approximately $200 million at IPO to an expected $765 million to $785 million for the current year, with a first year of profitability last year [7][8] Market Dynamics - The wholesale dealer-to-dealer market has contracted from 10-11 million units pre-COVID to about 7.5 million units currently due to supply chain issues and reduced new car sales [13][14] - The company anticipates a recovery in the market as new car sales and off-lease vehicles return, which will increase the supply of used cars available for wholesale [21][24] Competitive Landscape - Major competitors include Manheim, which holds an estimated 20% market share, and several hundred independent physical auctions [15][16] - ACV is positioned as a technology-driven player with a significant data advantage, having inspected millions of cars to create a robust dataset [18][66] Growth Strategy - ACV plans to expand its market share by engaging with a larger number of franchise dealerships, currently working with about one-third of the 17,000 franchise rooftops in the U.S. [9][10] - The company is also targeting the commercial vehicle market, which consists of repossessed cars, fleet vehicles, and rental cars, representing a total addressable market (TAM) of 6 million units [10][29] Financial Performance - The company aims for a midterm target of $1 billion in revenue and $350 million in adjusted EBITDA, with a projected 50% increase in adjusted EBITDA on 22% revenue growth for the current year [8][9] - Gross margin has improved significantly, with a target of reaching 60% in the near future [51] Technology and Data Utilization - ACV leverages technology to provide accurate valuations of used cars, enhancing the buying and selling process for dealers [35][66] - The company has developed additional services such as ACV Max for inventory management and ACV Capital for financing, which contribute to overall revenue [37][47] Operational Efficiency - The company has about 800 vehicle condition inspectors, averaging 6.5 inspections per day, with more mature territories achieving 10-12 inspections per day [60][62] - Efforts are underway to improve inspection efficiency and reduce time spent per vehicle, which will enhance productivity [63] Conclusion - ACV Auctions is positioned for continued growth in the dealer-to-dealer wholesale market, leveraging technology and data to enhance its value proposition and expand its market share [67] - The company is focused on building strategic partnerships with dealers and enhancing operational efficiencies to drive profitability [39][58]

Financial Data and Key Metrics Changes - Q1 revenue reached $183 million, representing a 25% year-over-year growth, with adjusted EBITDA of $14 million exceeding the high end of guidance [7][22][28] - Organic revenue growth was approximately 20% year-over-year, with adjusted EBITDA margin improving by 500 basis points [22][23] - Non-GAAP net income was above the high end of guidance, with margin increasing approximately 300 basis points year-over-year [23] Business Line Data and Key Metrics Changes - Auction and assurance revenue accounted for 58% of total revenue, growing 28% year-over-year, driven by 19% unit growth and an average revenue per unit (ARPU) of $500, which grew 8% [24] - Marketplace services revenue comprised 37% of total revenue, growing 24% year-over-year, reflecting record revenue for ACV Transport and ACV Capital [24] - SaaS and data services products made up 5% of total revenue, with a growth of 5% year-over-year [24] Market Data and Key Metrics Changes - The dealer wholesale market grew in the low single digits, with ACV selling 208,000 vehicles, a 19% year-over-year increase despite soft market conditions in February [7][22] - The overall dealer wholesale market is expected to be approximately flat year-over-year for 2025, with expectations for conversion rates and wholesale price depreciation to follow normal seasonal patterns [29][107] Company Strategy and Development Direction - The company focuses on three pillars for long-term shareholder value: growth, innovation, and scale, with a strong emphasis on expanding its dealer partner network and enhancing product offerings [6][8] - The strategy includes leveraging AI across product offerings to provide accurate pricing guidance and improve operational efficiencies [9][15] - The company aims to continue executing its profitable growth strategy while investing in long-term growth objectives [6][31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver strong top-line growth and increased adjusted EBITDA despite evolving macroeconomic conditions [6][31] - The company anticipates continued market share gains and is focused on expanding its addressable market as market conditions improve [31] - Management noted that while there are uncertainties in the broader market, the company is well-positioned to navigate these challenges [31][84] Other Important Information - The company ended Q1 with $342 million in cash and cash equivalents and marketable securities, alongside $167 million of debt [26] - For Q2, the company expects revenue in the range of $193 million to $198 million, reflecting a year-over-year growth of 20% to 23% [28] Q&A Session Summary Question: Is there any customer pushback regarding recent fee increases? - Management reported very little pushback from customers regarding price increases, emphasizing a fair pricing strategy and strong value proposition [34][36] Question: What growth avenues does ACV see under a tariff backdrop? - Management highlighted that ACV continues to grow and take market share, with value-added solutions helping to differentiate the company [39][42] Question: Have dealers' needs shifted due to tariffs? - Management noted that dealers are primarily focused on acquiring more inventory, with increased interest in new products [50][52] Question: What is the penetration and potential impact of the price guarantee tool and Project Viper? - Management indicated that the guarantee offering is growing, with significant interest, and Project Viper is in early beta stages with high demand [57][66] Question: How is ACV managing risk in ACV Capital? - Management explained that risk is minimized through regular dealer visits and improved risk management capabilities, resulting in reduced bad debt expense [75][76] Question: How does the company view the impact of tariffs on wholesale listings? - Management stated that while tariffs may affect pricing, the company primarily sources supply from dealers, which mitigates potential impacts [80][82] Question: What are the competitive dynamics in the market? - Management noted that competition remains strong, but ACV continues to execute well and take market share, positioning itself as a neutral partner for dealers [92][95] Question: How are dealers leveraging real-time data provided by ACV? - Management shared examples of dealers using ACV tools to buy cars from service drives and automate pricing, enhancing their operational efficiency [98][100]

Financial Data and Key Metrics Changes - Q1 revenue reached $183 million, representing a 25% year-over-year growth, with adjusted EBITDA of $14 million exceeding the high end of guidance [6][22][27] - Organic revenue growth was approximately 20% year-over-year, with adjusted EBITDA margin improving by 500 basis points [22][24] - Non-GAAP net income was above the high end of guidance, with margin increasing approximately 300 basis points year-over-year [22][24] Business Line Data and Key Metrics Changes - Auction and assurance revenue accounted for 58% of total revenue, growing 28% year-over-year, driven by 19% unit growth and an average revenue per unit (ARPU) of $500, which grew 8% [24] - Marketplace services revenue comprised 37% of total revenue, growing 24% year-over-year, reflecting record revenue for ACV Transport and ACV Capital [24] - SaaS and data services products made up 5% of total revenue, with a growth of 5% year-over-year [24] Market Data and Key Metrics Changes - The dealer wholesale market grew in the low single digits, with ACV selling 208,000 vehicles, a 19% year-over-year increase despite soft market conditions in February [6][22] - The overall used car supply is expected to be at a trough year, impacting market dynamics [42] Company Strategy and Development Direction - The company focuses on three pillars for long-term shareholder value: growth, innovation, and scale [7][31] - ACV is leveraging AI across its product offerings to enhance pricing guidance and improve dealer experiences [8][16] - The company aims to expand its total addressable market (TAM) and competitive moat through innovative product roadmaps and value-added services [5][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in executing a profitable growth strategy to create significant long-term shareholder value, despite evolving macroeconomic conditions [5][31] - The company anticipates revenue growth to exceed non-GAAP operating expense growth by approximately 500 basis points [28] Other Important Information - The company ended Q1 with $342 million in cash and cash equivalents and marketable securities, alongside $167 million of debt [26] - For Q2, the company expects revenue in the range of $193 million to $198 million, reflecting a year-over-year growth of 20% to 23% [27] Q&A Session Summary Question: Customer pushback on fee increases due to tariffs - Management reported very little pushback from customers regarding recent fee increases, emphasizing a fair pricing strategy [34][36] Question: Growth avenues under tariff conditions - Management highlighted ongoing growth and market share gains, with value-added solutions helping to differentiate ACV from competitors [38][41] Question: Dealers' needs and focus shifts due to tariffs - Management noted that franchise dealers are increasingly seeking more inventory and showing interest in new products, rather than being significantly impacted by tariffs [49][50] Question: Penetration and impact of new tools like price guarantee and Viper - The price guarantee tool is seeing strong interest, with an average of 10 bidders per car, while Viper is in beta testing with high demand anticipated [55][64] Question: ACV Capital's growth and risk management - ACV Capital grew revenue by 33% year-over-year, with improved risk management capabilities leading to a 50% reduction in bad debt expense [74][75] Question: Impact of tariffs on fleet owners and wholesale listings - Management indicated that while tariffs may affect new vehicle pricing, the current supply primarily comes from dealers, minimizing potential impacts on ACV's business model [78][80] Question: Competitive dynamics in the market - Management noted no significant changes in competitive dynamics, asserting that ACV continues to execute well and take market share [90][92] Question: Leveraging data for dealer decision-making - Management described how dealers are increasingly using ACV's tools to make informed decisions on pricing and inventory management, enhancing operational efficiency [95][100] Question: Year-to-date performance of the dealer wholesale market - Management reported that the dealer wholesale market is up low single digits year-to-date, with expectations for a flattish performance throughout the year [104][106]