Online auto marketplace CarGurus (NASDAQ:CARG) reported Q3 CY2025 results exceeding the market’s revenue expectations , with sales up 3.2% year on year to $238.7 million. Guidance for next quarter’s revenue was better than expected at $238.5 million at the midpoint, 0.6% above analysts’ estimates. Its non-GAAP profit of $0.57 per share was 3.7% above analysts’ consensus estimates. Is now the time to buy CARG? Find out in our full research report (it’s free for active Edge members). CarGurus (CARG) Q3 CY ...

Core Insights - CarGurus aims to double its total addressable market by introducing AI-powered products beyond its current automotive shopping platform [1][2] - The company is expanding its addressable market to include $3.5 billion spent by U.S. dealers on marketplaces and an additional $4 billion on software and data products [2] Product Development - CarGurus has launched PriceVantage, a machine learning-based pricing solution for dealers that utilizes real-time consumer demand data [3][4] - PriceVantage helps dealers enhance pricing strategies, improve turn times, and increase profitability by providing data-driven recommendations [4] Performance Metrics - Early beta results for PriceVantage show that engaged dealers experienced a 5X improvement in turn-time compared to competitors, with price-drop recommendations leading to a 68% median increase in daily vehicle detail page views [5] - 77% of the recommendations from PriceVantage met or exceeded predicted sales velocity outcomes [5] Consumer-Focused Innovations - CarGurus introduced CG Discover, a generative AI-powered shopping assistant that personalizes vehicle recommendations based on consumer needs, with traffic to this tool tripling quarter over quarter [6] - Another tool, Dealership Mode, provides real-time support to consumers at dealerships, enhancing their experience by offering vehicle pricing, ratings, and financing calculators [6][7] Market Opportunity - Research indicates that 80% of consumers are open to using AI in their car-buying journey, highlighting significant growth potential for CarGurus' AI initiatives [6]

Q3 2025 Earnings Presentation November 6, 2025 Cautionary Note Regarding Forward-Looking Statements This presentation includes forward-looking statements. Other than statements of historical facts, all statements contained in this presentation, including statements regarding our future financial and operating results; our fourth quarter and full-year 2025 financial and business performance, including guidance; the expectations about our intended wind down of CarOffer, LLC (CarOffer), including the Dealer-to ...

Core Insights - CarGurus reported a 14% year-over-year growth in Marketplace revenue, reaching $232 million, which exceeded the midpoint of guidance [1] - The company achieved a GAAP operating income of $64.1 million and a Non-GAAP Adjusted EBITDA of $82.4 million, reflecting an 18% increase year-over-year [1] - The firm has repurchased $111 million worth of shares since initiating its buyback program in December 2022, representing 23% of shares outstanding [1] Financial Performance - Marketplace Revenue for Q3 2025 was $231.7 million, a 14% increase from the previous year, while total revenue increased by 3% to $238.7 million [4] - Gross profit rose to $213.5 million, marking a 17% increase, with a gross margin of 89%, up 1,055 basis points year-over-year [4] - GAAP Net Income for Q3 2025 was $44.7 million, a 99% increase compared to the same quarter last year, with a net income margin of 19% [4] Key Performance Indicators - The number of U.S. paying dealers increased by 5% to 25,743, while international paying dealers grew by 11% to 7,930, resulting in a total of 33,673 paying dealers, a 6% increase [9] - The U.S. QARSD (Quarterly Average Revenue per Selling Dealer) was $7,742, an 8% increase, while international QARSD was $2,375, a 15% increase [9] - The U.S. Marketplace Segment Revenue was $210.4 million, a 12% increase, with operating income of $61.0 million, reflecting a 21% increase year-over-year [9] Shareholder Returns - The company repurchased $111 million in shares during Q3 2025, contributing to a total of 23% of shares outstanding repurchased since the buyback program began [1] - Non-GAAP earnings per share guidance for Q4 2025 is projected to be between $0.61 and $0.67 [12] Future Guidance - For Q4 2025, CarGurus expects Marketplace Revenue to be between $236 million and $241 million, with Non-GAAP Adjusted EBITDA projected between $83 million and $91 million [12] - Full-year 2025 guidance estimates Marketplace Revenue between $902 million and $907 million, with Non-GAAP Adjusted EBITDA expected to be between $313 million and $321 million [14]