RumbleOn(US:RMBL)2021-05-17 16:15Financial Data and Key Metrics Changes - RumbleOn reported a revenue of $104.3 million in Q1 2021, up from $70.4 million in Q4 2020, representing a 48% quarter-over-quarter growth [7][28] - Total gross profit for Q1 was $11.2 million, with a gross margin of 10.7%, down 20 basis points from Q4 but up from 7.2% in Q1 2020 [31] - Adjusted EBITDA was positive at $2.1 million, an improvement from a loss of $2.8 million in Q4 2020 and a loss of $6.5 million in Q1 2020 [33] Business Line Data and Key Metrics Changes - RumbleOn sold 3,500 units in Q1 2021, an increase from 2,647 units in Q4 2020 [28] - Powersport units sold were 1,006, generating $10.9 million in revenue, up 17% and 28% respectively compared to Q4 [28] - Automotive units sold were 2,494, generating $84.1 million in revenue, an increase of 40% and 52% respectively over Q4 [28] Market Data and Key Metrics Changes - The company experienced a significant imbalance in supply and demand, leading to higher pre-owned vehicle prices due to low new inventory availability [10][11] - The average selling prices and gross margins increased due to the supply-demand imbalance, despite a decrease in the number of vehicles sold year-over-year [29] Company Strategy and Development Direction - RumbleOn aims to become the first omnichannel customer experience in powersports through a pending business combination with RideNow, which is expected to close in Q3 2021 [22][40] - The company is focusing on enhancing its technology stack and business model to capture more market share and improve unit economics [42] - The integration with RideNow is anticipated to unlock incremental sales and improve access to quality pre-owned inventory, enhancing the consumer experience [24][70] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ongoing recovery from COVID-19, expecting unit volumes to return to or exceed pre-pandemic levels [31][39] - The company anticipates strong revenue and gross profit growth in Q2 2021, with guidance of $140 million to $150 million in revenue and $18 million to $19 million in gross profit [39][40] - Management highlighted the importance of digital solutions in the vehicle retail space and the need for a strong online presence combined with traditional retail [42] Other Important Information - RumbleOn raised approximately $36.7 million through a public offering, significantly improving its cash position and liquidity [35] - The company is seeing rapid adoption of its Dealer Direct solution, with a 235% increase in units sold through the online auction platform from Q4 to Q1 [20] Q&A Session Summary Question: What synergies are being seen with RideNow ahead of the merger? - Management noted improved access to pre-owned inventory and significant opportunities in consumer retail finance as key synergies [50][51] Question: What is the timeline for closing the RideNow acquisition? - The expected closing timeframe is early Q3, with OEM approvals being the main condition [52][53] Question: How has the mix of new to used vehicles changed recently? - Management indicated an improvement in the ratio of used to new vehicles due to reduced new vehicle availability, with expectations for a one-to-one ratio in the long term [68] Question: How are relationships with OEM producers changing? - Management reported positive responses from OEMs regarding the merger, with no pushback anticipated [70]