Cars.com (CARS) 3 Aug 232023 Q2 Earnings call transcript

Good morning, and welcome to the Cars Second Quarter 2023 Earnings Conference Call. This call is being recorded, and a live webcast and the accompanying slides can be found at investor.cars.com. An archive of the webcast will be available at Cars' Investor Relations website.

Now I'd like to turn the call over to Robbin Moore-Randolph, Director of Investor Relations.

Good morning, everyone, and thank you for joining us. welcome the to XXXX second pleasure call. conference my you Cars' to quarter It's morning Vetter, are Jain, this me With Alex CFO. CEO; Sonia and

second with detail along Alex highlights our XXXX discuss discussing by finish with financial quarter, the We'll our call our greater will will then in the results outlook. Sonia Q&A. start from business

can the to be financial to our attention Before the over call your presentation. non-GAAP our I in of to statements found draw description and turn measures, definition which Alex, I'd like and forward-looking

We adjusted and tables will GAAP comparable flow. to adjusted with included the and discussing today, be measures in certain non-GAAP press of our financial appendix directly cash EBITDA, operating measures our measures earnings financial presentation. can free Reconciliations including non-GAAP most margin, of be these adjusted found release, EBITDA the the expenses in

to are uncertainties. Any subject forward-looking risks and statements

filed filings, forward-looking on our For in We our more included our any of obligation factors information, assume recently in which risk website. please no to to those including IR the section XX-K, update is statements. SEC refer most the available

I the call over to Now, will Alex. turn

Thank XXXX earnings second you, our quarter and Robbin, call. welcome to

X% solid driven X% I'm quarter to another Revenue $XXX $XXX million. and to by year-over-year to of report growth. profitable grew dealer pleased revenues increased year-over-year million results that

We also improved our adjusted EBITDA margin sequentially to XX%.

and next. factors underpin performance will into that for this success of of by was quarter this balance number Our year a driven the

the and audience quality marketplace digital our continued in of rollout increased delivering of our digital the initiative, highest partners. to our Specifically, adoption our investment in repackaging solutions market

is and seeing two-thirds opting both our yield revenue adjusted we been initiative We're from repackaging started This upper with customers and driving complete XX% the our improved are We repackaging marketplace dealer our packages. strong. that earlier have year, EBITDA. tier results into with of this over

last of and in five more and value the in than dealers the packages our capture over traffic benefit new Our increase XX% allow investment years. to product development,

As more increases more our packages far within higher-tier leverage dealers to for and their to likely features, stay opt is ecosystem. engagement it dealers in and our

seeing approximately ARP at In and a our the we of our least to ARPD three we're as fact, clear retention who upside from customer, additional products, times selling focused dealers which three an shows remain average on potential use strongest leads of products. higher cross

for with or as expected, was year-over-year largely As the incremental X% in of $XX and to XX% In inventory for accounted grew ARPD we confined our rates. a initiatives, than any pricing year-over-year of with dealers quarter cancellation more experienced lower legacy growth segment total, marketplace and this ARPD.

a work Please a reflected in note quarter the of will as result our the repackaging significant benefit and third was not that fully the portion back-half until weighted, quarter. be our financials in

focus our X,XXX see repackaging remaining added our XX% this significant year, We up last website been marketplace results bringing than since which cross XXX our solutions selling in strong of we more year-over-year. year-over-year new growth. customers has to total continue initiative from While year, XX% drove of the ARPD

the prior XXX to and demonstrated XXX risk units more also units, also appraisal We dealer year XXX customers than solution to approximately units connected compared sequentially website with product our new X,XXX and Accu-Trade, net growing upsells year-over-year. up saw no momentum

continued also increase. sequential usage dealer a completed than And totaled XX% to XXX,XXX, Appraisals using Accu-Trade climb. more

and that important close right used any ever within car deals a than accurately time As have in profitability by to vehicles to valuation. prices continue more every consistency minutes the money. are Accu-Trade transparency on to car real pricing time improves fluctuate, it's

Combining our digital strong solutions for demand with generation is differentiator a capabilities strategy.

XXX a across the buy sell prior million vehicles XX X% supported increase visitors This year. shop, unique and quarter, to from million visits, Cars.com

a and which organically, of more brand. content than competitive reminder, long-standing Cars.com testament in to investments our is our audience comes us a to also XX% and advantage As editorial a to

see of delivery the leader websites. is audience dealer traffic into in consistently power driving dealer Cars.com We our the directly traffic through into our systems. clearly website referral

times peers, organic much traffic we and new other traffic our as of generate us more publicly our visitors our strength traded customers as the In also bring to two marketplace. than to any fact, net allows

Platforms promote gain. hide whereas their aggregators selfish participants, them for

and far As value power dealerships they more Google to see measure evident. will on Analytics more Cars.com's is lean and delivery, platform monitor traffic

three buy the to website. shoppers unique to dealer's Further a website than more that consumers access dealers times is audience helps cars more referred to visited Cars.com a car faster. sell are by dealer a who This Cars.com only likely proof

Innovation part also consumer with to the been allow and evolve buying innovation and dealer continue adoption is vehicles. efficient synonymous we more to of and beginning, a experience of our since has of becoming far DNA integration selling Increasingly, artificial our intelligence. and both

messaging and for time. proprietary doing to chat We Anna a this the We use help XX/X. fueled to marketplace, improve. model solution all DI handled some dealerships language with self-educate connects instantly on bot, learning XX% powered quarter, have websites that continues this advanced conversations conversations been customers Anna's tool, AI chatbot power our our our AI behind scenes of and and

Using to we power I'm analyze AI millions reviews. regarding using dealer available also without only sentiment are reviews hundreds experience. consumer having This experience excited consumers of dealership expected generative synthesize Cars.com, AI now large generative on sift potential dealer to language about understand through models the the to improve of helps of products. and our to

synthesize using also listing reviews AI We're generative vehicle and to details.

synthesis cleaning more cleaner, of quarter, our into vehicle displays. cluttered that teams will descriptions detailed vehicle This deployed attributes, powerful with technology have up users provide vehicle bulleted

we're meaningful of create read power efficiencies, sift using experiences hundreds the to AI reviews and gain Rather consumers through of to consumer customer expect value. unstructured or and than better data, add

buyers XX to of same driving Cars.com customer To lot happy our off at continues our sellers. want recently we which campaign ad years, new car and Coupled reflect launched we with our car over position possibilities, and who about to the us elected called spirit innovation the next a which ride. in thing, logo, the reminds change, sellers their of this emphasize modernize nexus buyers

consumers second the that vehicles, typically make. to information three about financing trading. inspiration largest two most months will Car sourcing and It's spend buyers retailers, valuing and purchase getting ever their

driver's by Where facilitates lifestyle purchasing Importantly, often stage And showcases car or a life stage highlights and of Next purchases our the next a in triggered excitement tagline your change. Car personal new how our campaign new the next the life. transportation to

logo with and million $XXX profile new in directly delivered off branding TV, audio is placements and than across kicked high Our and media digital, more social campaign June impressions.

see has traffic organic expect positive into to the continued are campaign this We translate generated excited and about our momentum. response

offers help suite and sellers. car platform of Our possibilities comprehensive a solutions to buyers

a high performance. adoption as virtuous that Our profitable propel intent growth. our And solutions, this cycle of dealer and coupled creates fuels our further OEM our production inventory audience with will builds,

I'm for digital positioned marketplace our our our high year growth drive well solutions and through quality dealer second beyond adoption and ahead, we are in of packages, of to half Looking partners. the market the to our providing new confident our continued audience

detail. performance call our greater Now detailed I'll financial in the over Sonia to to discuss turn

Sonia?

Thank you, Alex.

year-over-year for solid achieved EBITDA Total results, our both X% the growth. range. within quarter million, We representing adjusted of another quarter revenue revenue and $XXX was delivering guidance

and given accelerated our initiatives. our of softness to and media nature as second expect driven with year-over-year, third quarter’s marketplace continued growth and business, by packaging experienced products, build X% resulting subscription growth in we from And solution the the upon our results revenue quarter. as dealer in revenue, we up was growth continued revenue well national particularly growth and OEM While strong

invest into deeper the financial taking to our Diving like and results, cover to growth. our I'd top in expenses line approach we're disciplined

brands, quarter, the and Cars.com to prior million. launch which in and This sales the the growing critical expenses highly to due brand, $X expenses compensation to our adjusted maintaining our to increase compared possibilities investment dealer marketing For a investments deliver year. primarily industry of higher engaged our customers. is were allows higher due audience campaign. operating our us to $XXX and million including to These the are leading

of other offer intent, like Alex we're instant through more dealer websites to features, As Cars.com consumers. cash any instant to consumers drives helping than And high and identify further mentioned the transact new marketplace. customers addition ready dealer our financing,

product hire growth, $XX to or and licenses party the expenses and quarter and investing diluted product $X.XX related $X technology specifically income consulting or costs. driven totaled million a compensation also share, our ago. We third to in support diluted to to share led million, continued year costs, per $X.XX for which by development Net per compared

of to we release in to the current income all deferred substantially our will valuation on our of tax originally and deferred was fully we expected able recorded tax Our future allowance utilize performance the our income, recent assets XXXX. on primarily assets. Based net believe be related quarter

our drove that initiatives the to turn let's this context, of financials the With quarter. success

end As as of and more Alex a delivery intended This than repackaging it's to our bottom strategic marketplace price. top value is XX% the the with the our And is quarter. accretive initiative proven complete mentioned, line. align initiative better to both of

and Simplify, the leverage some customers one for dealers within both team capabilities to enable platform go our our sales market and to dealer of experience cross package.

received had initiative this cohorts increased either that any advanced we quarter. involves pricing or with given in the churn that who particularly notifications changes As five pricing quarter, we pricing, incremental anticipated

dealer end in customers, as move July. of we’ve year the from ARPD of initiatives, Encouragingly, is prior inventory, repackaging cancellations stabilize seen lower we customers. quarter. and dealer trends second X% lower quarter marketplace of compared half with the This by the the driven beyond largely the The XX,XXX variance enter the customer lower to month

repackaging increase. remained historical marketplace quarter than Overall remained X% year-over-year ARPD delivery our initiative, our contributed it our half drove sequentially of strong. evidence $XX and June second a in at growth rate the that of ARPD Independent value retention high more

we to the quarter. expect based strong our accumulate results Given in third model, subscription revenue these fully

played continued sell our to sales also growth, solutions have in increased digital approximately role of cross improvement year-over-year to a Our our strong of ARPD ARPD. efforts in half

on media from XX% grew of including pricing upsells in packaging cross value of that renegotiated contracts increased digital revenue better inspire and align dealer our solutions, advertising a growth advertising delivery our structure. websites, platform combination year-over-year and our Cars.com with Our

the has national we are While dealer today, points media products. we Not strength to nearly revenue yet cross also if would in eager we're include our for in were did dealer bounced our inspires year-over-year benefits of we dealer be growth. seeing customers existing seeing services dealers their responsible of only spending advantage marketing they marketing four but Note, we ARPD more are platform half revenue use year-over-year. digital back, expand in take growth advertising do higher of but our our products, not OEM not seeing ARPD of

platform our reflects across major all strength business. this performance of with strategy growth our Our quarter of the pillars

free the $XX and was flow offset half by year-over-year million $XX million. primarily Cash June the totaled positive cash month activities operating taxes cash. million provided free in to to was XXXX, for working six ending million XX, transitioning cash our changes $XX by first EBITDA $XX of in The Now increase increased and during XXXX. due partially flow adjusted of capital higher cash period

this Similar million bond was cash to expiration last interest payment to our quarter, on the made year-over-year credit $XX.X also lower but of due principal the our we outstanding of swap semi-annual year, and our lower facility. interest

of year, six reducing $XX.X our leverage During total of of net the June X.Xx. range target At million million paid end, of months the middle our to the $XXX in X.Xx of comfortably to debt, XX, was debt down XXXX. as Xx we quarter outstanding first

$XX of maintain ample and on continue liquidity undrawn comprised We $XXX million $XXX revolver of hand. capacity to million of million of cash

return balance to and shares strong provides our XXX,XXX year-to-date, $XX repurchased flexibility to million. with capital us Additionally, the financial we shareholders, sheet for

maintain revenue to us execution continued Our balanced strong a enables allocation and strategy. capital generation

in B to performance reduction steady consistent our credit minus As our plus. rating of a B global operating from leverage, result upgraded and S&P double

to Now turning guidance. our

between quarter to $XXX continued we of deliver and year-over-year solid revenue sequential growth the strong of growth, X.X% For to million XXXX representing third million with expect X.X%. $XXX

marketplace via reflects Our improvement of continued cross initiatives, sells, and repackaging products third sequential quarter and national OEM guidance modest solutions and expansion rollout media the our revenue. in dealer of

and XX.X% adjusted We margins between XX.X%. quarter expect to third EBITDA be

quarter EBITDA brand Cars.com guidance our marketing support revenue margin reflects guidance new investment to adjusted and Our third increased campaign.

midpoint we're of year, X% X% from the For XXXX our full to revenue to X% raising year the revenue growth X%, guidance. narrowing range our guidance to effectively

benefit initiatives well improvement Our marketplace OEM guidance in the our modest first half as continued reflects revenue. and national half our and repackaging strong as second performance of

XX%. approach We're EBITDA reaffirming quarter that are to also adjusted margins fourth expected still

audience strong well customers, and Our to with ARPD scale execution core operating our position together continued to intent these KPIs focus goals. on achieve us high

Operator And call like with open that, I'd the for to Q&A.

ahead, Go question Tom. from first D.A. from our White [Operator And Instructions] Tom comes Davidson.

morning, everyone. for A could. Good Great. Thanks taking if couple I question. my

the in this X%, by I range, for rather, million So, the the a guess, revenues dealer revenues up but end so, was couple total of beat forecast nicely -- low revenue up at came quarter our for year bucks.

I like bit. guess, a line, quarter you the that and And little the looks you was think it maybe I revenue other national let bit. down So, last up perking national said a

So, the revenue to bit range on year a an to tightening that. the curious you're hear high full of But, on net-net I'm little end. for the update

a bit it's just what's confidence that? national better from the maybe dealers Sounds do Maybe So, color maybe revenue rates it's giving retention to price of like after on you hikes. perking not up.

on giving of you confidence the what's Just kind curious that?

question, Thanks for the Tom.

into we momentum think. cross-sell print, the products revenue. our But solutions particularly putting as and So, in not still dealer seeing we're the lot that -- marketplace, seeing just business. a we media really did solid of repackaging we're It's well. with strong activity It's have a QX

year. of of we to the You're been revenue that related we run those little that national we've in there which line. run was the would don't license well we this last that in spot of agreements, talk simply inherited, ton see is year, softness seeing some acquisition OEM did license that about bit anticipated on other line. a the off Accu-Trade, non-cash. what our We there experience were But some delta you agreements actually off and as a as the And in other

material impact adjusted So EBITDA. they to any have really don't

that guide the of is of bit over transpire that, little a on looking quarter. forward growth blended sort of reported The the marketplace what the the a of terms repackaging. have year-over-year we in we think on X% course we view I saw ARPD, like

each phased think of I launching a cohorts taken to month. repackaging little we've about talked bit we've approach how a kind

benefit each And you of month. can the imagine, sequential and ARPD so, building as is

drivers as look core a did bit on in you terms an marketplace, digits our If the at a and little actually peel basis. back ARPD of double example, June the onion ARPD, of year-over-year grow

of also have last numbers the challenges some fact benefits dealers ARPD year in repackaging. numbers our revenue the one same look dealer that dealer this way right that's marketplace numbers in at is had I year, the don't that when the digital of of the the think in you in now and and we offsetting we

was line, a based. kind it's be impression the up was yours. not helpful. you've the there could perking Okay. know, was comments I that just little last bit national and, TrueCars perked that And I OEM display then advertising quarter-over-quarter. That's on that But some has revenue different a quarter, bit line. suggested of It's, wrong. I they maybe But than under that, up

to hard it is going delayed and then OEMs. So, back of in exactly from that the just back you. curious, like, get Thank queue. line come kind get out hard Or to forecast, what Did anything there how quarter second you're slip know into? of kind of I'll to hearing the to just is very, And half? still

to my moving compete as incentive And OEM know inventory think that increasing their do is spending. as of to recommending promote We spend sales opposed they understanding isn't as immediately dollars Tom, fast vehicle would road moving and to as more for incentives, discounting. low for that's business are a growth them those we we're to And OEMs OEMs. nearly like. Yes,

value OEMs. we have approaches different So creating do for fundamentally to

have the the We're I in having think into second are Pre-owned, that the see conversations this up picked don't all about of getting the back And are we we the OEMs very from to Certified productive. were business lean expected. where feel from we year. more going just reception back starting But we're still OEMs. very has getting pleased half downside with rather yet we're line but good not clients, feedback would conversion upside. and

Good. Thank you.

And our Marvin ahead, from Fong BTIG. next comes go question from Please Marvin.

churn mentioned the is that the that churn Or for Thanks Do that? to morning. you I by still compared stabilized flattish a Maybe, of Sonia, just was you think negative account number. mean kind July, dealer taking at you exactly just June? the in what dealer but mean Good my stabilizing do questions.

helpful? color on that would Just more be

bit to dealer earlier, relative account out Yes, to I little we've perspective as of June. get the in approach taken think more kind I a have QX. We phased the of from notifications mentioned a rolling think into stabilizing dealers and we given to actual effect repackaging where in a QX advance. rate lot between going notifications increases, we some saw activity that

with became complete the a we're the of July, communications QX, almost little of as think a complete. the we're bit So quarter, of bottleneck you speak end dealer out XX% end repackaging to second of of of so coming XX% about as as

So from media more to from sell head on like year, the of into our repackaging ordinary course shifting focus continuing and as of our we focus products. activities the we're bit stretch of cross little solutions and our a back to the

Thanks, Great. to guess, next advertising, on on just drill that. OEM question down my And just I

a implied So -- fourth and you're guidance quarter year provide full you does full performance. obviously, it

So, embedded be And you. sequential expect now. for helpful? in just we would from how OEM right Should there assumptions share third your item line Thank what's your will thought improvement fourth that quarter the in or sort guidance another quarter. your of just perform

national improvement modest in and have be production then that's the reception QX. And you cautiously one continue look great I expecting as out. has OEM positive. we being been for customers revenue OEMs. we our increasing, feedback typically QX aware from think while of of question. optimistic about and levels OEM Alex said, we our you're getting the No, sequentially shifting Generally, drivers line, been big sure mentioned what I'm into we're that as into the earlier, and Yes. are But as the a national and And launches model to are new said, OEM

Thanks much. Perfect. so

But down see will but are modest. uptick to be mean we'll what likely we'll right numbers still just year-over-year, I where It's an to the caveat by we on still now. that relative

And Rajat. our from Please next JPMorgan. ahead, from Gupta question go Rajat comes

thanks morning, for Good Great. the and question. taking

to the first year, repackaging of number, Just initiatives, is quarter. and want clarify you XX%, a dealer that you have the base, that? on targeting the clarification in That one were targeted third are the this XX%, like Or XX% is subset the right? XX% mentioned, the you then to just relative XX%

clarify. Happy to

actually were So, the XX% we targeting more customers. much than of

our dealer customers. targeting the So -- our majority majority are we the of substantially of

it. Got

So dealer its XX% all your of customers?

going No. them. them We're A of call XX-ish market but percent. it are not to of like today, lot all rates already at

And returning Understood. Got like similar Thanks. see Any of any lower. if it. to seeing platform? dealers? the One versus independent And the some used And dealers having segment. account That's conversations then, pressure terms potentially trends. granularity franchise to move your dealer helpful you're on you're dealers the digital-only in the more. also, just clarification. one sequential have continues wondering And in with independent of the car around any of

point our to of question. year. clarification we Rajat. base, dealer is the one came majority Great are targeting early are want the Sure, in while make of biggest targeting the that I we also increases

furthest base on dealers minimizing another that that were largely July, And means dealer which market that so, repackaging, was please, getting picked things, now largest we're did stable churn the rate. from of dealer experience, increases, through asking we dealer that we full through away we the XX% churn were at better and rate the that results it July account, two got the justifying the of up we're for the

inventory. than were lower a others. that of increases concentration more of And independent their sizable So there heavy much smaller with dealers was

a but us So, a lot from there. of to in the I know made combination we these asking year-over-year dealers, that we values lot think a the were sense

digital point your the year that had I this we digital about was and know, taken XXX platform. that is with Sony on think denominator, advertising almost as timely, dealer think dealers locations of I number you our dealers on the entering we're of out XXX

dealers. we've in out been we of are been decent And now generating so many dealer back discussions And headwind, a with on but running, revenue. growth that's digital the still

to end of do It's beginning in telling year. back fertile that year, pulled spend to year money I they've come want that. that our to they starting of expecting are in not that last a got marketplace this guide. not dealers this meaningful way back to move We're inventory, think if it's them we're that But the to any and realize digital help

a had I on You follow think. question too

Yes.

exiting guidance Just rate last that EBITDA on exit one that XX% for to putting The out number. the the quarter, XXXX -- there imply margin that the is the for reason EBITDA that have. classification was least is on in margins of all the annualized seasonality indicate going to at basis? to just That's I an business, be some XX% there? sort Or new fourth

Yes.

have example drive EBITDA committed terms necessarily, beginning margin in improvement as and there the out when of the that XX% to subject the is showing of to we of margins that business. really be just historically investments. have We example, had year, we the industry in of very I kind we an working big to have target And to sitting sort QX though wouldn't can as sequential since have events. It lower tended in an adjusted

new We'll quarters. guidance So EBITDA different bar a not necessarily it's XXXX for in set our go subsequent forward setting expectations. adjusted

questions good and Great. it. the taking Thanks luck. for Got

Gary [Operator ahead, from Please Gary. comes Instructions] our question next from go Prestopino And Barrington Research.

Was good more digital being morning, of dealers The this March? drip the there down. gone was quarter all everyone. end customers that out or any Hi, coming dealer by

Yes. Good morning, Gary.

really question was that in dealer done digital the March. On

additional no, there. So stress

low really dealers? Okay. were the mostly really And of budget were the priced pulled were majority, using solutions, things that. These out, dealers digital that they they independent that using assuming high not the then you just were that like were any

is we tend even our you the ARPD, the those churn experienced, of they some QX a that, of sort independent inventory dealers. be lower within majority of dealers. at to look and lower using And product are That When correct. dealers one

Okay.

right. all So

or thing? not from three source do or signing amongst of have terms something services Alex, displacing you themselves? Accu-Trade, do same vehicles that are you're Accu-Trade used dealers two taking trade to are the a different are you consumers just in that for the on they or up Or finding solution So that

to Dealers ways buying question, obviously cars auction. from of directly Great the because the get buying of a inventory. for the can they public, legacy a fresher industry or And that prevalent a inventory. gets cycled you've new in emerging generally That hasn't yet. them The doing trend more really likelihood Gary. you're you through a help get able if of source typically, much retail cars have two most customer obviously at out selling multiple way higher is car, is market got The car, so it one.

were you Accu-Trade from that think dollars right? customer spend your power, legacy cars, everyone private directly If a our the Every marketplace. about have month XXXXs can fees auction comes of your lane, through opportunities buying course who's you $X,XXX of of and car lot, shopping service for a at party unlimited sourcing for way and you with buying on

cars through thrilled the of really were we appraised organic So see the to Accu-Trade. in lift number

The number is dealer account growing nicely.

Solutions accounted for stream, but of stabilization our the are a multiple has not us, with very we it ARPD And or that a revenue. that the creates dealers new using see also only for it growth. that's solutions stabilizes And from sticky revenue marketplace. XX%

accelerate now, in marketplace just this we're thrilled growth will so need and happen through when And Accu-Trade we're to which repackaging. naturally the with

for rate negotiations offering. with It to takes through cycle dealers core a marketplace your lot XX,XXX of time get

it our XX% through July. teams that largely with of so, through And are

towards cross-selling upselling the see now and more a And shifting so second you'll in half.

comments any make on you fuel. can then, And

high both uptake We acceptance mean, of narrative out. I there haven't terms priced in is a very in is of been anything going heard product there. your How's and How the that? your that that--

Fuel offerings that we it. are media services is call dealers with interest have. seeing it Great, from great Gary. out We more few a of pleased question, from we're because specifically, and CARS. media and we generally, And one didn't

fast, their looking that quite to turning more lots. forward not to exploring dealers on And are organically because half, as that's so, see in actually something second the we're inventory, starting

they're additional so to more for turning And services. us media

increasingly But inventory. marketplace not it got focus us move we've for have an think are fuel, in us repackaging extension through got to And retargeting QX, we've a solutions, wasn't now I we're more we the huge initiative. inventory dealers to again, spending more that that but talking do solution. only for about

So, steam top and is it up by but for out right us. margin we which line may name, revenue media high upsells not call now, are picking nice

lastly, to, revenue getting maybe do two it see COVID. before was back guys And you a year pre the Okay. OEM ever where or or COVID

is something Given you that everything conference -- All is you cut got call. on OEMs, directly we you read that their said right. to from these costs. GM read Mean, that that at think we'll recover do ever business lower can of not revenue to you profitability there a recover? and And the if that is anything that it's going try stream? to really increase

debate is Gary, And I'm a could by win. we believer. I think thing the only

car well-positioned they plant, dealers companies need forward, or to their OEMs overwhelmingly, digitally spend to the I do believe spend need we're physical that dealerships need the supports digitally. their data less plan. force more digitally do do thesis, on more going to and on continue to you to we do more that. and that macro And to think they believe think I digital that help

know, got for we've As multiple you with vectors growth OEM.

talking about rates We raising our are on can we because fees there. offering, we higher justify website know

which are organic about And the and they're happening. data few that and got have to cookie our them so with offerings, the discussions reach we OEMs, largest buyers data reach on when they solutions. using there. trading sources more I that we've going of about new for to also first talking tools, there shop, party spend more to to technology the talking do IP audience to them we're There's with a tracking, people mentioned we're revenue were financing streams collapse our last that month targeting, can to particularly

very you that very, are initial what we're I'll XXXX from strong hearing in preliminarily terms of And tell for upfront them.

business big is that definite few a year. this Why I'm big going over business inventory boon hasn't I'm the grow to shortage. So believer. I materially our been what years. next believer of this But for understand a it line a the

Thank Okay. you.

Please next Capital Steve. Dyer Steve question comes Craig from go from Hallum Group. Our ahead,

Ryan Good on is morning. This for Steve.

Just OEM having increased to and one OEMs demand I guess they us. Are any a question seems from models, little for lackluster Curious national. you anyways. as interest advertise on they're EV production or follow-up look new certain conversations one from the OEMs ramping as or

curious any interest side? on Just the EV

XXX% with with search the EV, about than almost what availability. gallon. up And of exploded standpoint. $X prices $X is north know softened search year from has share have gas gas flocked search EV more prices wane. trends those our a inventory share consumer Consumers platform, demand we're has demand consumer moderated, prices or tend market And now seeing but EV that product actually last a they clipping do correlate on to to we were when

are various Unfortunately, drop inventory. OEMs that think low many more can right still. And that offerings there's we is and We to price the incentives. I will because certainly shopping increase that EV in and immediately screaming OEMs we move consumer products introduce likelihood generally for the them way think to people awareness us, dropping there that their hope price. moving one of now to And out call to are convert that who their their just much actively than listening agencies are time, and real

Very good. Good luck. Thanks.

Thank you

CEO Vetter, remarks. at questions. this further the turn no are And call time, back over like your closing to would to for there Alex I

on today the interest engagements year. for going Sonia are in participating to BTIG This and to I Conference our we'll And on XX. us, call. joining want that your I'd CARS keep the investor I posted in another to you be and August concludes mention you like thank throughout Virtual

conference attending. you call. for Thank today's concludes This