Core Insights - Cars.com Inc. has appointed Cormac Twomey as the new Chief Technology Officer (CTO) to enhance innovation and scale the technology platform [1][2] - Twomey brings extensive experience in SaaS and digital marketplace technologies, having previously served as CTO at OpenTable, where he successfully transitioned the company to a SaaS-based model [2][3] - His appointment is expected to drive the company's growth in AI and improve automotive retail and wholesale capabilities [1][2] Company Overview - Cars Commerce is a technology company focused on empowering the automotive industry through innovative products and AI-driven solutions [4] - The company operates a platform that includes various brands such as Cars.com, Dealer Inspire, AccuTrade, DealerClub, and Cars Commerce Media Network, aimed at streamlining car buying and selling processes [4] - The platform supports local retail operations by providing essential tools for trade-in, appraisal, and marketing services [4]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $181.6 million, reflecting a 1% year-over-year increase, aligning with expectations for low single-digit growth in the second half of the year [16] - Adjusted EBITDA for Q3 was $55 million, a 7% year-over-year increase, with an adjusted EBITDA margin of 30.1%, demonstrating strong revenue flow-through and cost management [22][21] - Net income for Q3 was $7.7 million, or $0.12 per diluted share, compared to $18.7 million, or $0.28 per diluted share, a year ago, primarily due to changes in the fair value of contingent consideration for prior acquisitions [21] Business Line Data and Key Metrics Changes - Dealer revenue increased by 2% year-over-year, driven by successful repackaging activities and an increase in customer count [16] - The marketplace continues to be the largest contributor to dealer count growth, with over 300 net new dealer customers added since the start of the year [17] - AccuTrade and Dealer Club saw significant growth, with AccuTrade surpassing 1 million quarterly appraisals and Dealer Club increasing active users by nearly 40% quarter-over-quarter [11][12] Market Data and Key Metrics Changes - The average monthly visitors to the marketplace reached 25.4 million, up 4% year-over-year, with total traffic year-to-date at 488 million visits, setting a new record [7] - OEM and national revenue was down 5% year-over-year, primarily due to reduced spending from two OEM partners, although the overall OEM revenue pipeline remains strong [13][18] Company Strategy and Development Direction - The company is focused on 2025 growth initiatives, including enhancing dealer engagement through new sales leadership and improved go-to-market strategies [5] - The phased marketplace repackaging exercise aims to align pricing with product value, helping dealers drive more leads per listing [6] - AI integration is central to the company's product innovation roadmap, enhancing the shopping experience for consumers and improving lead conversion for dealers [8][9] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the business's ability to grow OEM revenue despite near-term headwinds, citing strong enthusiasm for the audience and dealer adoption [31] - The company reaffirmed expectations for low single-digit revenue growth in the second half of 2025, driven by continued execution of growth initiatives [26] - Adjusted EBITDA margin outlook for fiscal 2025 is between 29%-31%, reflecting disciplined cost management and high contribution margins from pricing initiatives [26] Other Important Information - The company has utilized over two-thirds of free cash flow for share buybacks, totaling $64 million year-to-date, with a full-year repurchase target raised to $70 million-$90 million [24][25] - Total liquidity was reported at $350 million as of September 30, 2025, providing ample capacity for capital allocation priorities [25] Q&A Session Summary Question: Drivers of revenue in Q3 and dealer navigation of the current industry backdrop - Management noted that while there are near-term headwinds for manufacturers, enthusiasm for the audience remains strong, and dealers are increasingly recognizing the value of the platform [30][31] Question: Insights on repackaging and its impact on ARPD - Management highlighted that repackaging has led to sequential momentum in ARPD, with premium-plus packages showing significant adoption [36][37] Question: Competitive landscape changes and capital allocation priorities - Management indicated that while the competitive landscape is evolving, the company's platform strategy remains differentiated, focusing on driving down dealer advertising costs [44][47]

Financial Performance - Cars Commerce achieved record Q3 revenue of $181.6 million, a 1% year-over-year increase[37] - Adjusted EBITDA increased by 7% year-over-year to $55 million[45] - Adjusted EBITDA margin improved by 160+ bps year-over-year to 30.1%[15, 45] - The company repurchased 5.2 million shares year-to-date in 2025, totaling $64 million, compared to $36 million in the same period of 2024[12] Key Metrics - Average Monthly Unique Visitors increased by 4% year-over-year to 25.5 million[15, 46] - Total traffic (visits) increased by 1% year-over-year in Q3, reaching 156.2 million[19, 46] - Dealer Customers increased QoQ by 114, reaching 19,526[15, 32] - Average Revenue Per Dealer (ARPD) was $2,460, up 1% QoQ[15, 34] Business Growth - AccuTrade appraisals increased by 56% year-over-year, surpassing 1 million quarterly vehicle appraisals[24] - DealerClub active dealers increased by almost 40% QoQ[26] Outlook - The company anticipates low-single digit year-over-year revenue growth for the second half of 2025[53] - The company projects an Adjusted EBITDA margin between 29% and 31% for the full year 2025[57] - The company targets share repurchases between $70 million and $90 million for the full year 2025[57]

Core Insights - Cars.com Inc. achieved record total revenue of $182 million in Q3 2025, with dealer revenue growing by 2% year-over-year [1][5] - The company expanded its customer base by 271 year-over-year, reaching 19,526 dealer customers, supported by the launch of AI-powered search features [1][4] - The company repurchased $64 million of stock year-to-date, on track to meet its target of $70 to $90 million for FY25 [1][10] Financial Performance - Total revenue for Q3 2025 was $181.6 million, a 1% increase from $179.7 million in Q3 2024 [3][5] - Net income decreased to $7.7 million, or $0.12 per diluted share, down 59% from $18.7 million, or $0.28 per diluted share in the prior year [7] - Adjusted net income rose by 10% to $30.4 million, or $0.48 per diluted share, compared to $27.7 million, or $0.41 per diluted share a year ago [3][7] Operational Highlights - Average monthly unique visitors increased to 25.5 million, a 4% year-over-year growth [4] - The company reported a 1% increase in traffic, totaling 156.2 million visits [4] - Monthly average revenue per dealer (ARPD) was $2,460, reflecting a 1% increase quarter-over-quarter but a 1% decrease year-over-year [4] Cost Management - Total operating expenses decreased to $164.8 million from $168.2 million in the prior year, with adjusted operating expenses down 4% to $150.4 million [6][7] - Adjusted EBITDA for Q3 2025 was $54.6 million, representing 30.1% of revenue, an increase from 28.5% in the previous year [7] Cash Flow and Balance Sheet - Net cash provided by operating activities for the nine-month period ended September 30, 2025, was $114.5 million, down from $122.5 million in the prior year [8] - Free cash flow for the same period totaled $94.5 million, compared to $103.7 million in the previous year [8] - Total debt outstanding was $455 million, with a net leverage ratio of 1.9x, below the target range of 2.0x to 2.5x [9] Shareholder Returns - The company repurchased 1.5 million shares for $19.3 million in Q3, totaling 5.2 million shares for $63.9 million year-to-date [10] - The company reaffirmed its target for share repurchases of $70 to $90 million for fiscal 2025 [10][11] Future Outlook - The company anticipates low-single digit revenue growth for the second half of 2025, based on current market conditions and execution of growth initiatives [12] - Full-year adjusted EBITDA margin guidance remains at 29% to 31%, reflecting confidence in managing operating levers [13]

Financial Performance - Second quarter revenue remained steady at $178.7 million year-over-year[45] - Adjusted EBITDA margin reached 28.5%, hitting the high end of the projected 27% to 29% range[14, 53] - The company repurchased 3.7 million shares during the first half of 2025[13] Operational Highlights - Total traffic visits reached 162 million in the second quarter[14, 18] - The company saw a 50% quarter-over-quarter increase in completed transactions on DealerClub[39] - AccuTrade appraisals increased by 14% quarter-over-quarter and 45% year-over-year, totaling approximately 925,000 appraisals in Q2[36] Strategic Initiatives - OEM and National revenue increased by 5% year-over-year[14, 15, 45] - The company added 162 dealer customers quarter-over-quarter, bringing the total to 19,412[14, 30] - AI-powered search capabilities led to a 2x higher lead submission rate compared to standard search, with nearly 20% of internet leads originating from the new search capability[22] Outlook - The company projects low-single digit year-over-year revenue growth for the second half of 2025[58] - The company anticipates an Adjusted EBITDA margin of 29% to 31% for the full year 2025[62] - The company increased its share repurchase target to $70 to $90 million for the full year[62]

Core Insights - Cars.com Inc. reported a strong sequential increase in dealer customers, reaching 19,412, marking the best growth in over three years [1][3] - The company achieved a record of 27.8 million monthly average unique visitors and 332 million visits in the first half of 2025 [1] - The company repurchased 2.1 million shares, representing 3% of shares outstanding, and raised its FY 2025 share repurchase target to $70 to $90 million [1][9] Financial Performance - Total revenue for Q2 2025 was $178.7 million, roughly flat compared to the prior year [4][39] - Net income decreased by 38% year-over-year to $7.0 million, with adjusted net income slightly up by 1% to $26.4 million [3][39] - Adjusted EBITDA for Q2 2025 was $50.9 million, representing a 1% increase from the previous year [3][39] Operational Highlights - Average monthly unique visitors decreased by 8% quarter-over-quarter but increased by 2% year-over-year [40] - Traffic (visits) declined by 5% quarter-over-quarter but increased by 2% year-over-year [40] - Monthly average revenue per dealer (ARPD) was $2,435, down 2% year-over-year [40] Cost Management - Total operating expenses for Q2 2025 were $163.5 million, down from $169.4 million in the prior year [5] - Adjusted operating expenses decreased by 2% year-over-year to $152.7 million, reflecting cost efficiencies [5] Cash Flow and Balance Sheet - Net cash provided by operating activities for the first half of 2025 was $55.7 million, down from $68.7 million in the prior year [7] - Free cash flow for the same period totaled $41.8 million, compared to $56.4 million in the prior year [7] - Total debt outstanding was $460.0 million, with total liquidity of $317.7 million as of June 30, 2025 [8]

Group 1 - Cars.com Inc. will participate in the J.P. Morgan 53rd Annual Global Technology, Media and Communications Conference on May 13, 2025, at 3:30 p.m. CT / 4:30 p.m. ET [1] - The presentation will be available as a live webcast on the Cars.com Investor Relations website, with an archived replay accessible shortly after the presentation [1] Group 2 - Cars Commerce is an audience-driven technology company focused on empowering the automotive industry by simplifying car buying and selling through AI-driven technologies [2] - The company offers a platform organized around four leading brands: Cars.com, Dealer Inspire, AccuTrade, and DealerClub, providing various solutions for retail operations [2]

Financial Performance - The company's Q1 2025 Adjusted EBITDA reached $50.721 million, with a margin of 28.3%, exceeding the guidance range of 25.5% to 27%[12, 46, 63] - Q1 2025 revenue was $179 million, slightly down year-over-year from $180 million in Q1 2024[12, 38] - The company repurchased 1.6 million shares in Q1 2025, spending $22 million, compared to $9 million in Q1 2024[12] - Adjusted net income for Q1 2025 was $23.956 million, compared to $28.663 million in Q1 2024[64] - Free cash flow for Q1 2025 was $23.660 million, compared to $27.455 million in Q1 2024[65] Key Metrics and Growth Drivers - Average monthly unique visitors reached 29 million in Q1 2025, a new quarterly record[14, 17, 52] - Total traffic (visits) was 170.1 million in Q1 2025[17, 52] - The company had 19,250 dealer customers, up approximately 40 QoQ[14, 48] - OEM and National revenue increased by 6% year-over-year[14, 32, 38] - AccuTrade appraisals grew 16% QoQ, powering over 813,000 appraisals in Q1[25] Outlook - The company projects an Adjusted EBITDA margin of 27% to 29% for Q2 2025[56] - The company anticipates an Adjusted EBITDA margin of 29% to 31% for the full year 2025[60] - The company plans to repurchase $60 to $70 million in shares for the full year 2025[60]

Core Insights - Cars.com Inc. reported Q1 2025 revenue of $179 million, a slight decrease of 1% year-over-year, driven by a 6% growth in OEM and National revenue, while subscription-based Dealer revenue fell by 2% due to macroeconomic pressures [3][6] - The company achieved a record of 29 million average monthly unique visitors, reflecting strong engagement and adoption of its solutions [1][11] - Cars.com increased its dealer customer base to 19,250, indicating a positive trend in dealer engagement [1][11] Financial Performance - Total revenue for Q1 2025 was $179.0 million, down from $180.2 million in Q1 2024 [3][31] - Net loss for the quarter was $2.0 million, or $0.03 per diluted share, compared to a net income of $0.8 million, or $0.01 per diluted share in the prior year [8][32] - Adjusted net income decreased by 16% to $24.0 million, or $0.37 per diluted share, from $28.7 million, or $0.43 per diluted share a year ago [3][36] Operational Highlights - Average monthly unique visitors increased by 26% quarter-over-quarter and 3% year-over-year, reaching 29 million [5][11] - The company reported a 16% quarter-over-quarter growth in AccuTrade appraisals, indicating improved customer engagement [11] - DealerClub saw a 60% increase in active users and nearly doubled the volume of completed auctions from February to March 2025 [11] Cost Management - Total operating expenses for Q1 2025 were $172.6 million, up from $167.4 million in the prior year, influenced by the acquisition of DealerClub and higher severance costs [7][31] - Adjusted operating expenses remained flat at $155.3 million, reflecting disciplined cost management [7][38] Cash Flow and Balance Sheet - Net cash provided by operating activities was $29.5 million, down from $33.5 million in the prior year [9][33] - Free cash flow for the quarter totaled $23.7 million, compared to $27.5 million in Q1 2024 [9][37] - As of March 31, 2025, total debt outstanding was $460 million, with total liquidity of $321.4 million [10][10] Strategic Outlook - The company aims to reaccelerate dealer revenue growth in Q2 2025 through growth initiatives, including marketplace and website repackaging [2][14] - Full-year 2025 revenue guidance has been suspended due to macroeconomic uncertainties, but the company reaffirms its Adjusted EBITDA margin guidance of 29% to 31% [14][15]

Financial Results Announcement - Cars.com Inc. expects to report its financial results for the first quarter ended March 31, 2025, on May 8, 2025 [1] - A conference call will be held at 8:00 a.m. CT/9:00 a.m. ET on the same day to discuss the results [1][2] Company Overview - Cars Commerce is an audience-driven technology company that empowers the automotive industry [3] - The company offers products and solutions that simplify car buying and selling, utilizing AI-driven technologies across various stages of the retail process [3] - The Cars Commerce platform includes four leading brands: Cars.com®, Dealer Inspire, AccuTrade, and Cars Commerce Media Network [3]