Cars.com Inc. Q4 FY2024 earnings call

• Alex Vetter highlighted strong 2024 performance with record revenue, adjusted EBITDA growth, and product innovation. Announced Lisa Goss as new Chief Commercial Officer. Discussed AccuTrade growth, Cars.com marketplace strength, OEM and national performance, and acquisition of Dealer Club. - Sonia Jain discussed Q4 financial results: revenue of $180.4 million, operating expenses down, adjusted EBITDA of $55 million, net income of $17 million, and provided details on operating expenses, product and technology expenditures, marketing and sales costs, and general and administrative expense.

AccuTrade: Now in over 1000 dealerships, annual appraisal volume up 35% year over year, Q4 vehicles acquired post-appraisal per dealer up 23% year over year, and 8 new OEM endorsements. Cars.com marketplace: Reached over 23 million shoppers in Q4 with 143 million visits, 6% repeat visitation year over year, and over 60% organic traffic mix. OEM and national: Q4 revenue up 15% year over year, full-year growth 18%, 2025 upfronts up double digits year over year. Dealer websites: Powered over 7,600 Dealer Inspire and D2C websites in Q4, with D2C reaching 1,100 customers in Canada.

• First quarter 2025 revenue expected between $178 million and $180 million. Full-year 2025 revenue anticipated at $745 million. - Adjusted EBITDA margin for Q1 2025 expected between 25.5% and 27%, and for fiscal 2025 between 29% to 31%. - New share repurchase authorization of $250 million over a three-year term, with target share repurchases of $60 to $70 million for 2025.

• Macro uncertainties, including potential impacts from tariffs. - OEM and supplier relationship changes. - Competition and challenges in integrating new products like Dealer Club.

Q: Tom White asked about full-year revenue guidance, Dealer Club impact, and dealer revenues.

A: Sonia Jain and Alex Vetter responded on revenue growth drivers, Dealer Club integration timing, and seasonal softness in dealer revenues.

Q: Naved Khan inquired about AccuTrade customer count growth, margins, and Dealer Club impact.

A: Alex Vetter and Sonia Jain discussed AccuTrade retention, margin drivers, and Dealer Club integration costs.

Q: Gary Prestopino asked about Dealer Club integration timeline and bundling with AccuTrade.

A: Alex Vetter explained Dealer Club integration progress, benefits for dealers, and potential bundling strategies.

Q: Marvin Fong questioned web solution dynamics and macro uncertainty impact.

A: Alex Vetter and Sonia Jain discussed website business upside, OEM relationships, and resilience to macro changes.

Q: Joe Spak asked about margins and AI investment.

A: Sonia Jain and Alex Vetter talked about margin drivers, Q1 margin guidance, and AI initiatives for dealership efficiencies.

Q: Rajat Gupta inquired about second-half growth, buyback, and leverage.

A: Sonia Jain and Alex Vetter provided details on second-half growth drivers, buyback plans, and leverage position.