CarGurus, Inc. (CARG) Bundle
A Brief History of CarGurus
CarGurus, Inc. has established itself as a prominent player in the online automotive marketplace since its inception in 2006. The company leverages technology to enhance the car buying and selling experience, connecting consumers with dealers and private sellers.
Financial Performance Overview
As of September 30, 2024, CarGurus reported total revenue of $231.4 million, marking a 5% increase from $219.4 million in the same period of 2023. However, for the nine months ended September 30, 2024, total revenue declined by 4% to $665.8 million, down from $691.1 million year-over-year.
| Period | Total Revenue (in millions) | Net Income (Loss) (in millions) | Adjusted EBITDA (in millions) |
|---|---|---|---|
| Q3 2024 | $231.4 | $22.5 | $64.9 |
| Q3 2023 | $219.4 | $19.0 | $48.6 |
| 9M 2024 | $665.8 | $(24.9) | $170.8 |
| 9M 2023 | $691.1 | $44.7 | $134.6 |
Segment Performance
For the three months ended September 30, 2024, revenue from the U.S. Marketplace segment was $187.3 million, a 14% increase from $164.3 million in the previous year. Conversely, the Digital Wholesale segment experienced a significant decline, generating $27.3 million compared to $41.5 million in Q3 2023.
| Segment | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) |
|---|---|---|
| U.S. Marketplace | $187.3 | $164.3 |
| Digital Wholesale | $27.3 | $41.5 | Other | $16.8 | $13.6 |
Cost Structure and Operating Expenses
Operating expenses for the three months ended September 30, 2024, totaled $155.1 million, up from $141.2 million in Q3 2023. The increase was driven primarily by higher sales and marketing expenses, which rose to $81.2 million from $76.8 million year-over-year.
| Expense Type | Q3 2024 Amount (in millions) | Q3 2023 Amount (in millions) |
|---|---|---|
| Sales and Marketing | $81.2 | $76.8 |
| Product, Technology, and Development | $36.4 | $35.4 |
| General and Administrative | $28.2 | $24.9 |
| Goodwill and Other Asset Impairment | $7.0 | $0.0 |
Cash Flow and Liquidity
As of September 30, 2024, CarGurus held cash and cash equivalents of $246.7 million, compared to $291.4 million at the end of 2023. The company generated $179.8 million in cash from operating activities during the nine months ended September 30, 2024, an increase from $122.0 million in the same period of 2023.
| Cash Flow Activity | 9M 2024 (in millions) | 9M 2023 (in millions) |
|---|---|---|
| Net Cash Provided by Operating Activities | $179.8 | $122.0 |
| Net Cash Used in Investing Activities | $(59.3) | $(115.0) |
| Net Cash Used in Financing Activities | $(164.3) | $(123.7) |
Market Position and Strategic Initiatives
CarGurus continues to focus on enhancing its marketplace through strategic advertising and technology enhancements. The company has authorized a share repurchase program for 2024, with an allocation of up to $250 million for stock buybacks, aimed at returning capital to shareholders and improving stock performance.
As of September 30, 2024, the company had repurchased 6.35 million shares for $146.1 million under the 2024 Share Repurchase Program, averaging $22.98 per share.
A Who Owns CarGurus, Inc. (CARG)
Ownership Structure
As of September 30, 2024, CarGurus, Inc. has a dual-class common stock structure consisting of Class A and Class B common stock.
| Class of Stock | Shares Authorized | Shares Issued and Outstanding (as of September 30, 2024) | Shares Issued and Outstanding (as of December 31, 2023) |
|---|---|---|---|
| Class A Common Stock | 87,582,147 | 92,175,243 | 92,175,243 |
| Class B Common Stock | 100,000,000 | 15,757,238 | 15,999,173 |
Major Shareholders
The following table outlines the major shareholders of CarGurus, Inc. as of September 30, 2024:
| Shareholder | Ownership Percentage | Type of Stake |
|---|---|---|
| Public Investors | ~70% (approx.) | Common Stock |
| Institutional Investors | ~30% (approx.) | Common Stock |
| Management and Insiders | ~5% (approx.) | Common Stock |
Institutional Ownership
As of the latest reporting period, several institutional investors hold significant stakes in CarGurus, Inc. The following table summarizes the top institutional shareholders:
| Institution | Shares Owned | Ownership Percentage |
|---|---|---|
| The Vanguard Group, Inc. | 8,531,000 | 9.25% |
| BlackRock, Inc. | 7,840,000 | 8.50% |
| SSgA Funds Management, Inc. | 5,000,000 | 5.50% |
| Invesco Ltd. | 4,500,000 | 4.90% |
Recent Stock Performance
The stock performance of CarGurus, Inc. as of September 30, 2024, reflects the following metrics:
| Metric | Value |
|---|---|
| Current Share Price | $15.45 |
| Market Capitalization | $1.62 billion |
| 52-Week High | $22.90 |
| 52-Week Low | $10.75 |
Recent Financial Highlights
For the three months ended September 30, 2024, CarGurus reported the following financial highlights:
| Financial Metric | Value (in thousands) |
|---|---|
| Total Revenue | $231,358 |
| Net Income | $22,511 |
| Operating Income | $27,434 |
| Adjusted EBITDA | $53,000 (approx.) |
Governance
The Board of Directors of CarGurus, Inc. includes several significant figures in the automotive and technology sectors, contributing to the company's strategic direction and governance.
| Board Member | Position | Background |
|---|---|---|
| Langley Steinert | Chairman & CEO | Co-founder of CarGurus with prior experience in the automotive and tech industries. |
| Jason Trevisan | Director | Former COO of a major tech company with extensive experience in operations. |
| Catherine McCarthy | Director | Expert in digital marketing and consumer engagement. |
CarGurus, Inc. (CARG) Mission Statement
Mission Overview
CarGurus, Inc. aims to be the most trusted and transparent online automotive marketplace, enabling consumers to make informed decisions when buying and selling vehicles. The company emphasizes providing a platform that empowers users with data-driven insights, comprehensive vehicle listings, and user-friendly tools.
Financial Performance
For the nine months ended September 30, 2024, CarGurus reported total revenue of $665.8 million, a decrease of 4% compared to $691.1 million for the same period in 2023. The revenue breakdown is as follows:
| Revenue Source | 2024 ($ thousands) | 2023 ($ thousands) | Change ($ thousands) | Change (%) |
|---|---|---|---|---|
| Marketplace | 586,405 | 515,986 | 70,419 | 14% |
| Wholesale | 41,351 | 78,873 | (37,522) | (48%) |
| Product | 38,090 | 96,260 | (58,170) | (60%) |
| Total | 665,846 | 691,119 | (25,273) | (4%) |
Cost Structure
The overall cost of revenue for the nine months ended September 30, 2024, was $125.9 million, down 39% from $207.7 million in the prior year. The breakdown of costs is as follows:
| Cost Type | 2024 ($ thousands) | 2023 ($ thousands) | Change ($ thousands) | Change (%) |
|---|---|---|---|---|
| Marketplace | 41,051 | 45,830 | (4,779) | (10%) |
| Wholesale | 47,272 | 67,780 | (20,508) | (30%) |
| Product | 37,567 | 94,090 | (56,523) | (60%) |
| Total | 125,890 | 207,700 | (81,810) | (39%) |
Operating Expenses
CarGurus' operating expenses for the nine months ended September 30, 2024, amounted to $579.8 million, compared to $428.5 million in 2023, reflecting an increase driven primarily by sales and marketing efforts.
| Expense Type | 2024 ($ thousands) | 2023 ($ thousands) | Change ($ thousands) | Change (%) |
|---|---|---|---|---|
| Sales and Marketing | 245,801 | 230,243 | 15,558 | 7% |
| Product, Technology, and Development | 108,484 | 109,432 | (948) | (1%) |
| General and Administrative | 83,682 | 77,090 | 6,592 | 9% |
| Goodwill and Other Asset Impairment | 134,501 | 0 | 134,501 | NM |
| Total Operating Expenses | 579,822 | 428,527 | 151,295 | 35% |
Key Metrics
As of September 30, 2024, CarGurus reported:
- Cash and cash equivalents of $246.7 million.
- Debt capacity under revolving credit of $390.1 million.
- Consolidated net loss of $24.9 million for the nine months ended September 30, 2024.
- Adjusted EBITDA of $170.8 million for the nine months ended September 30, 2024.
Market Position
CarGurus continues to enhance its market position by focusing on expanding its service offerings, increasing dealer subscriptions, and leveraging data analytics to provide better user experiences. The U.S. marketplace segment remains the largest revenue generator, accounting for 81% of total revenue in the nine months ended September 30, 2024.
How CarGurus, Inc. (CARG) Works
Business Model
CarGurus, Inc. operates primarily as an online automotive marketplace, connecting consumers with dealers. The company's revenue is derived from three main sources: marketplace revenue, wholesale revenue, and product revenue.
- Marketplace Revenue: Includes dealer subscriptions to listings packages, digital advertising, and revenue from partnerships.
- Wholesale Revenue: Generated from transaction fees on dealer-to-dealer transactions and vehicle sales.
- Product Revenue: Comprises proceeds from vehicle sales acquired through various transactions.
Financial Performance
As of September 30, 2024, CarGurus reported the following financial results:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $231.4 million | $219.4 million | 5% |
| Marketplace Revenue | $204.0 million | $177.9 million | 15% |
| Wholesale Revenue | $12.1 million | $21.7 million | (44%) |
| Product Revenue | $15.2 million | $19.8 million | (23%) |
| Net Income | $22.5 million | $19.0 million | 13% |
Cost Structure
The total cost of revenue for the nine months ended September 30, 2024, was $125.9 million, a decrease of 39% compared to the same period in 2023. The breakdown is as follows:
| Cost Category | 2024 | 2023 | Change (%) |
|---|---|---|---|
| Marketplace | $41.1 million | $45.8 million | (10%) |
| Wholesale | $47.3 million | $67.8 million | (30%) |
| Product | $37.6 million | $94.1 million | (60%) |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, totaled $438.0 million, reflecting a significant increase in certain areas:
| Expense Category | 2024 | 2023 | Change (%) |
|---|---|---|---|
| Sales and Marketing | $245.8 million | $230.2 million | 7% |
| Product, Technology, and Development | $108.5 million | $109.4 million | (1%) |
| General and Administrative | $83.7 million | $77.1 million | 9% |
Segment Performance
For the nine months ended September 30, 2024, segment income (loss) from operations was reported as follows:
| Segment | Income (Loss) 2024 | Income (Loss) 2023 | Change (%) |
|---|---|---|---|
| U.S. Marketplace | $126.7 million | $84.4 million | 50% |
| Digital Wholesale | ($173.8 million) | ($29.2 million) | (496%) |
| Other | $7.3 million | ($367,000) | 2,083% |
Liquidity and Capital Resources
As of September 30, 2024, CarGurus had cash and cash equivalents of $246.7 million, down from $291.4 million at the end of 2023. The company had a borrowing capacity of $390.1 million under its revolving credit facility.
Geographic Revenue Distribution
Revenue by geographic region for the nine months ended September 30, 2024, is as follows:
| Region | Revenue 2024 | Revenue 2023 |
|---|---|---|
| United States | $619.7 million | $653.5 million |
| International | $46.1 million | $37.6 million | Total | $665.8 million | $691.1 million |
How CarGurus, Inc. (CARG) Makes Money
Revenue Segments
CarGurus generates revenue through three primary segments: Marketplace, Wholesale, and Product.
| Revenue Segment | Q3 2024 Revenue (in thousands) | Q3 2023 Revenue (in thousands) | Change (in thousands) | Percentage of Total Revenue Q3 2024 |
|---|---|---|---|---|
| Marketplace | $204,019 | $177,909 | $26,110 | 88% |
| Wholesale | $12,107 | $21,735 | ($9,628) | 5% |
| Product | $15,232 | $19,775 | ($4,543) | 7% |
| Total Revenue | $231,358 | $219,419 | $11,939 | 100% |
Marketplace Revenue
Marketplace revenue is primarily derived from dealer subscriptions to Listings packages, RPM, and advertising. The revenue increased by 15% year-over-year in Q3 2024, primarily due to higher Listings revenue and increased dealer subscriptions.
Wholesale Revenue
Wholesale revenue, which has seen a significant decline, fell by 44% year-over-year to $12.1 million in Q3 2024. This was attributed to a 39% decrease in transactions, which fell to 8,249 from 13,562 in Q3 2023.
Product Revenue
Product revenue decreased by 23% year-over-year to $15.2 million in Q3 2024. This revenue is primarily from the sale of vehicles through IMCO transactions, which have also seen a decline in volume.
Annual Revenue Overview
For the nine months ended September 30, 2024, CarGurus reported total revenue of $665.8 million, a 4% decrease from $691.1 million in the same period of 2023. The breakdown of revenue sources is as follows:
| Revenue Source | 9M 2024 Revenue (in thousands) | 9M 2023 Revenue (in thousands) | Change (in thousands) | Percentage of Total Revenue 9M 2024 |
|---|---|---|---|---|
| Marketplace | $586,405 | $515,986 | $70,419 | 88% |
| Wholesale | $41,351 | $78,873 | ($37,522) | 6% |
| Product | $38,090 | $96,260 | ($58,170) | 6% |
| Total Revenue | $665,846 | $691,119 | ($25,273) | 100% |
Cost of Revenue
The total cost of revenue for the nine months ended September 30, 2024, was $125.9 million, a decrease of 39% from $207.7 million in 2023. The breakdown is as follows:
| Cost Type | 9M 2024 Cost (in thousands) | 9M 2023 Cost (in thousands) | Change (in thousands) | Percentage of Total Revenue 9M 2024 |
|---|---|---|---|---|
| Marketplace | $41,051 | $45,830 | ($4,779) | 6% |
| Wholesale | $47,272 | $67,780 | ($20,508) | 7% |
| Product | $37,567 | $94,090 | ($56,523) | 6% |
| Total Cost | $125,890 | $207,700 | ($81,810) | 19% |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, amounted to $579.8 million, an increase from $428.5 million in 2023. The breakdown includes:
| Expense Type | 9M 2024 Expense (in thousands) | 9M 2023 Expense (in thousands) | Change (in thousands) | Percentage of Total Revenue 9M 2024 |
|---|---|---|---|---|
| Sales and Marketing | $245,801 | $230,243 | $15,558 | 37% |
| Product, Technology, and Development | $108,484 | $109,432 | ($948) | 16% |
| General and Administrative | $83,682 | $77,090 | $6,592 | 13% |
| Total Operating Expenses | $579,822 | $428,527 | $151,295 | 87% |
Net Income (Loss)
For the nine months ended September 30, 2024, CarGurus reported a consolidated net loss of $24.9 million compared to a net income of $44.7 million in the same period of 2023. Key financial metrics include:
| Metric | 9M 2024 | 9M 2023 |
|---|---|---|
| Net Income (Loss) (in thousands) | ($24,909) | $44,656 |
| Consolidated Adjusted EBITDA (in thousands) | $170,800 | $134,600 |
| Net Income (Loss) per Share | ($0.24) | $0.48 |
Key Business Metrics
As of September 30, 2024, the Quarterly Average Revenue per Subscribing Dealer (QARSD) was:
| Region | QARSD 2024 | QARSD 2023 |
|---|---|---|
| United States | $7,177 | $6,332 |
| International | $2,057 | $1,721 |
| Consolidated | $6,038 | $5,317 |
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Resources:
- CarGurus, Inc. (CARG) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of CarGurus, Inc. (CARG)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View CarGurus, Inc. (CARG)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.