What guidance did Cars.com's management provide for the next earnings period?

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What were the key takeaways from Cars.com’s earnings call?

Did Cars.com beat or miss consensus estimates last quarter?

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What were the key takeaways from Cars.com's earnings call?

- **Revenue Resilience**: $182M Q3 revenue (+1% YoY) despite macro headwinds, driven by dealer count growth (+300+ YoY).
- **AI-Driven Engagement**: Carson users save 3x more vehicles and return 2x as frequently, signaling AI's conversion potential.
- **Profitability Expansion**: Adjusted EBITDA margin of 30.1% (up 160bps YoY) reflects cost control and revenue mix shift.
- **Share Buybacks**: $64M spent year-to-date, targeting high end of $70-90M range.
- **Dealer Momentum**: Marketplace ARPD for multi-product users is 3x higher, highlighting cross-selling opportunity.

**【CEO Summary Section】**
- Q3 revenue reached $182 million, up 1% year-over-year, driven by dealer count growth and AI-driven marketplace innovations.
- Dealer count increased by 300+ year-over-year, with marketplace contributing 50% of net adds, reflecting strong dealer adoption of Premium and Premium Plus packages.
- AI initiatives like Carson (natural language search assistant) boosted consumer engagement, with users saving 3x more vehicles and returning 2x as frequently.
- Adjusted EBITDA margin expanded to 30.1%, up 160 basis points YoY, supported by cost control and revenue mix improvements.
- Share buybacks totaled $64 million year-to-date, with plans to reach the high end of the $70-90 million target.

**【CFO Financial Commentary】**
- Q3 GAAP net income was $7.7 million, with adjusted EBITDA of $55 million, up 7% YoY.
- Dealer revenue grew 2% YoY, offsetting a 5% decline in OEM/national revenue due to temporary customer pullbacks.
- Operating expenses decreased 2% YoY, driven by headcount and lease cost efficiencies.
- Free cash flow of $94.5 million year-to-date supported share buybacks and debt reduction.
- Full-year outlook reaffirms low single-digit revenue growth and adjusted EBITDA margin of 29-31%.

**【Q&A Key Highlights】**
- **Dealer Adoption**: AccuTrade added 82 subscribers Q/Q, with 50%来自enterprise deals. DealerClub active users grew 40% Q/Q.
- **AI Impact**: Cars.com cited 2x more frequently than peers in LLMs, driving record 25.4M monthly visitors (+4% YoY).
- **Capital Allocation**: Share buybacks remain top priority, with $64M spent year-to-date.
- **Competitive Strategy**: Marketplace ARPD for multi-product users is 3x higher than single-product users, highlighting cross-selling opportunities.
- **OEM Pipeline**: Positive discussions for 2026 ad spend, with unique ability to deliver Tier 1-3 outcomes for automakers.

Cars.com Inc. (CARS) Q3 2025 Earnings Call Transcript

- **Revenue resilience**: $179M flat YoY, with 5% OEM/national growth offsetting dealer softness. Dealer count +162 to 19,412.
- **AI-driven growth**: AI search leads 2x higher quality, 20% of total leads. Traffic hits 162M visitors (2% YoY).
- **Product momentum**: DealerClub +50% QoQ, AccuTrade appraisals +14% QoQ. 2025 H2 low single-digit growth outlook.
- **Financial strength**: 28.5% EBITDA margin, $45M buybacks YTD. Full-year buyback target raised to $70-90M.
- **Strategic initiatives**: Marketplace Premium Plus packages launching Q3 to boost ARPD and cross-selling.

**【CEO Summary Section】**
- Q2 revenue of $179 million was steady year-over-year, with 5% growth in OEM/national revenue offsetting dealer revenue softness. Dealer count rose 162 to 19,412, the best sequential growth in 3 years.
- AI-powered search features drove 2x higher lead submission rates, accounting for 20% of internet leads. Marketplace traffic hit 162 million visitors, up 2% YoY.
- New commercial leadership increased sales velocity, with DealerClub transaction volume growing 50% QoQ. AccuTrade appraisal activity reached 925,000, up 14% QoQ.
- 2025 outlook: Low single-digit YoY growth in H2, accelerating into 2026. Marketplace Premium Plus packages launching in Q3 to boost ARPD.

**【CFO Financial Commentary】**
- Adjusted EBITDA of $51 million (28.5% margin) at high end of guidance, driven by $163 million in operating expenses (-3% YoY). Net income $7 million ($0.11 EPS), vs $11 million ($0.17 EPS) YoY.
- Share buybacks: $45 million year-to-date (107% of free cash flow), with full-year target raised to $70-90 million.
- 2025 outlook: Low single-digit revenue growth, 29-31% EBITDA margin. ARPD expected to improve with repackaging rollouts.

**【Q&A Highlights】**
- **ARPD trends**: Sequential decline of $40 due to indie dealer mix and solutions-first customers. ARPD expected to improve with Q3 repackaging.
- **AI impact**: AI search leads 2x higher quality, with 50%+ marketplace subscribers using lead intelligence features.
- **Dealer retention**: AccuTrade retention strong when tied to store-wide mandates; enterprise deal with 150-store dealer group.
- **OEM tailwinds**: 50% of OEMs increased spending despite tariff uncertainty; Q2 incremental sales robust on short lead times.
- **DealerClub growth**: 50% QoQ transaction growth; integrates with AccuTrade for seamless wholesale/retail transitions.


Cars.com Inc. (CARS) Q2 2025 Earnings Call Transcript

- **Revenue Resilience**: Q1 revenue of $179M matched guidance, with EBITDA margin of 28.3% vs. 29.5% YoY, driven by cost control.
- **Dealer Growth**: Dealer count +40 QoQ to 19,250, with AccuTrade appraisals up 16% to 813,000 and DealerClub active users +60%.
- **Consumer Surge**: 29M monthly unique visitors (+11% YoY), with tariff-related editorial traffic up 50% YoY.
- **OEM Uncertainty**: 50% of media spend now month-to-month; Q1 OEM revenue +6% YoY but 2+ OEMs signaling caution.
- **Share Buybacks**: $22M repurchased in Q1, exceeding $60-70M annual target pace.
- **Guidance Adjustment**: Full year revenue guidance suspended; Q2 expected +YoY and +QoQ, with back-half growth from subscriptions.


**【CEO Business Highlights】**
- Q1 revenue of $179 million, within guidance range, with adjusted EBITDA exceeding high end of expectations by over 100bps.
- Dealer count rose to 19,250, the best sequential organic growth since mid-2022, driven by independent dealers and Marketplace adoption.
- AccuTrade appraisal volume up 16% QoQ to 813,000, with top quartile dealers acquiring nearly 50 cars/month via the platform.
- DealerClub achieved 60% active user growth in first two months post-integration, with transaction volumes doubling month-over-month.
- Consumer traffic surged, with 29M avg monthly unique visitors (YoY +11%), driven by tariff-related editorial content and improved user experience.
- OEM revenue grew 6% YoY, despite late-quarter signals of tighter media spend management from some automakers.

**【CFO Financial Summary】**
- Q1 GAAP net loss of $2M (-$0.03 EPS) vs. $1M ($0.01 EPS) YoY, driven by $3M severance costs.
- Adjusted EBITDA of $51M (28.3% margin) vs. $53M (29.5%) YoY, reflecting lower-than-expected DealerClub integration costs.
- Free cash flow of $24M, with $22M share repurchases (vs. $60-70M annual target).
- Solutions portfolio added 100+ new website customers, with 70%+ wins from Dealer Inspire renegotiations.
- ARPD of $2,473 flat QoQ, with expectations for 2025 expansion via Marketplace packaging and AccuTrade adoption.

**【Q&A Key Takeaways】**
- **Tariff Impact**: Consumer traffic to editorial content +50% YoY, dealers pivoting to AccuTrade/DealerClub for used inventory acquisition.
- **OEM Media Spend**: 50% of ad spend now month-to-month; Q1 1/3 of OEMs increased spending, but 2+ large OEMs signaled caution.
- **DealerClub Monetization**: Currently transactional, but plans to leverage CarsCommerce inventory intelligence for future monetization.
- **Cost Discipline**: $3M headcount reduction in Q1, with additional operating leverage to manage macro volatility.
- **Guidance Adjustment**: Full year revenue guidance suspended; Q2 revenue expected +YoY and +QoQ, with back-half growth driven by subscription compounding.


Cars.com, Inc. (CARS) Q1 2025 Earnings Call Transcript

- **Revenue Record**: Q4 revenue hit $180.4M, highest ever, with full year up 4% to $719M.
- **OEM Growth**: Q4 OEM revenue +15% YoY, 8 new OEM endorsements for AccuTrade.
- **DealerClub Momentum**: 900 dealers signed up post-acquisition, targeting $100M+ in 2025.
- **Marketplace Leadership**: 23M unique shoppers in Q4, repeat visits up 6% YoY.
- **AI Innovation**: Testing AI for lead generation, showing 20%+ appointment rate improvement.
- **Share Buybacks**: $250M authorization; targeting $60M-$70M in 2025 buybacks.
- **Margin Expansion**: Full year EBITDA margin target 29%-31%, up 7% YoY.


**【CEO Business Highlights】**
- **Record Revenue Growth**: Full year 2024 revenue reached $719 million, up 4% YoY, with 17 consecutive quarters of revenue growth. Q4 revenue was $180.4 million, a new quarterly record.
- **OEM & National Strength**: Q4 OEM and National revenue grew 15% YoY, driven by increased marketing spend and new product adoption (e.g., New Car Hub). Full year growth for this segment was 18%.
- **AccuTrade Expansion**: Crossed 1,000 dealer subscribers, with appraisal volume up 35% YoY and 14% QoQ. Secured 8 new OEM endorsements, including BMW, Subaru, and Genesis.
- **DealerClub Acquisition**: Entered the $10 billion dealer-to-dealer wholesale market with DealerClub, targeting 1% market share ($100M+ revenue). Early adoption exceeded expectations, with 900 dealers signing up post-NADA launch.
- **Marketplace Dominance**: Q4 traffic reached 23M unique shoppers and 143M visits, with repeat visitation up 6% YoY. Led competitors in UVs and time-on-site in December.
- **AI & Platform Integration**: Launched Inventory Intelligence Platform (IIP) to optimize inventory management, reducing time-on-lot for 200,000+ vehicles. Testing AI for lead generation and appointment setting, showing 20%+ improvement in appointment rates.

**【CFO Financial Summary】**
- **Q4 Financials**: GAAP net income $17M ($0.26 EPS), up from $8M ($0.12 EPS) YoY. Adjusted EBITDA $55M (30.8% margin). Free cash flow $128M, highest since 2018.
- **2025 Guidance**: Full year revenue $745M-$755M (+4% YoY midpoint). Adjusted EBITDA margin 29%-31%, up 7% YoY. Q1 revenue $178M-$181M, with back-half growth acceleration.
- **Share Repurchases**: Authorized $250M over 3 years. 2024 buybacks $49M; targeting $60M-$70M in 2025.
- **Cost Management**: Operating expenses flat YoY at $150M (adjusted basis). Product/tech spend up 2% YoY, driven by DealerClub integration and security investments.

**【Key Q&A Insights】**
- **DealerClub Impact**: No 2025 revenue contribution baked in, but 30%+ dealer base already affiliated with endorsed OEMs. Integration with AccuTrade and IIP expected to drive cross-sell opportunities.
- **Margin Outlook**: Q1 EBITDA margin 25.5%-27% (down 300bps YoY) due to DealerClub costs and dealer revenue exit rate. Full year margin expansion (7% YoY) driven by back-half product launches and repackaging.
- **AI Investment**: No dedicated budget; AI initiatives embedded across all functions. Testing AI for lead routing, appointment setting, and inventory management.
- **Macroeconomic Resilience**: Business proven resilient through cycles. Monitoring dealer profitability and OEM marketing budgets, but confident in platform-driven growth.


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