Why did CARS miss Q4 2024 EPS estimates?

Cars.com Inc. (CARS) missed the Q4 2024 EPS estimates due to several factors:

1. **Revenue Shortfall**: Although Cars.com reported record quarterly revenue of $180.4 million for Q4 2024, which contributed to an annual total revenue of $719 million, an increase of 4% year-over-year, the revenue fell short of the estimated $183.9 million. This shortfall, along with a lower-than-expected revenue projection for the upcoming quarter, likely impacted the company's earnings and contributed to the EPS miss.
2. **Strategic Focus**: The company's strategic focus on product innovation and market expansion helped maintain its leadership in the automotive digital marketplace but may have temporarily impacted profitability. For instance, the expansion of the AccuTrade Connected product to approximately 1,000 subscribers and the increase in OEM and National revenue by 15% year-over-year indicate a long-term growth strategy that may have short-term profitability implications.

In summary, Cars.com's revenue shortfall and strategic focus likely combined to impact its Q4 2024 EPS, leading to the missed estimate.