TrueCar's Q2 2025 Earnings Call: Navigating Contradictions in Tariffs, Capital Allocation, and Revenue Strategies

Tariffs and OEM revenue expectations, capital allocation and share buybacks, dealer revenue growth strategy, and wholesale revenue growth expectations are the key contradictions discussed in TrueCar's latest 2025Q2 earnings call.



Revenue and Financial Performance:
- TrueCar's total revenue for Q2 2025 was $47 million, marking a 12.4% increase year-over-year and the highest quarterly revenue since Q3 2021.
- The net loss decreased to negative $7.6 million from negative $13.5 million in the same period last year, with adjusted EBITDA at negative $1.2 million.
- The growth was driven by higher OEM revenue and a 6.2% increase in new unit sales volume, which outpaced the industry's 2.8% growth in new vehicle retail sales.

Core Product Enhancements:
- TrueCar introduced new features such as Actionable Insights and motivated buyer badging to improve lead quality and engagement, resulting in a nearly 30% improvement in average cost per sale for non-affinity partner units.
- The enhancements include personalized dealer insights, targeted follow-ups based on high-intent shoppers, and improved consumer experiences through search results page and vehicle detail page redesigns.
- These changes aim to drive higher close rates and better align consumer needs with dealer inventory.

TrueCar+ Advancements:
- TrueCar+ achieved a significant increase in add-to-cart rate by 115% and a 40% lift in daily credit application submissions following the launch of a new checkout flow.
- The new flow integrates with dealer management systems and streamlines the consumer purchasing process, enhancing transparency and trust.
- This progress is crucial for TrueCar+ to capture a greater share of the online car buying market and differentiate itself in the digital retail space.

Used Vehicle Initiatives:
- TrueCar is focusing on vehicle sourcing initiatives to help dealers manage constrained new vehicle supply, with a shift towards vehicle sourcing products like Sell Your Car and TrueCar Wholesale Exchange.
- These initiatives enable dealers to source vehicles directly from consumers, reducing reliance on traditional auction platforms.
- The strategy aligns with the long-term growth plan, which includes expanding the dealer network, enhancing OEM partnerships, and commercializing TrueCar+ by the end of the year.