CarGurus’ Q1 2025: Navigating Tariff Challenges and CarOffer Strategy Amidst Consumer Spending Trends

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Marketplace Revenue and EBITDA Growth:
- CarGurus reported a 13% year-over-year growth in marketplace revenue, adding $25 million, with marketplace adjusted EBITDA growing by 27% year-over-year.
- This growth was driven by increased dealer count, subscription tier upgrades, higher adoption of value-added products, and strong lead growth.

International Expansion and Product Innovation:
- International revenue expanded by 20% year-over-year, with a 22% year-over-year increase in aggregate leads in Canada and the UK.
- This growth was supported by steady traffic growth, product innovation, and enhanced dealer adoption, with over 90% of surveyed dealers in Canada reporting better ROI compared to alternative platforms.

OEM Advertising and Consumer Engagement:
- OEM advertising sustained healthy revenue growth in Q1, delivering double-digit gains year-over-year.
- This performance was supported by strong annual upfront commitments, highlighting CarGurus' leadership in the marketplace business and traction in new areas of innovation.

CarOffer and Strategic Assessment:
- Despite a 52% decline in wholesale revenue and challenges faced by CarOffer, there was a 26% sequential decline in digital wholesale segment transaction volumes.
- To address this, CarGurus initiated a broader strategic assessment of its wholesale business model to achieve sustainable growth and profitability.