CarGurus (CARG) 2024 RBC Global TIMT Conference summary

Financial performance and growth drivers

• Achieved seventh consecutive quarter of accelerating top-line growth, with double-digit increases for four quarters and marketplace business up 15% year-over-year.

• International business grew 23%, nearing profitability levels of the core U.S. segment.

• OEM advertising returned to double-digit growth due to normalized inventory, with OpEx flat and EBITDA margin up over 30% year-over-year.

• Seasonal margin expansion in Q3 and Q4, driven by disciplined marketing spend and ROI focus.

• Digital Deal product adoption more than doubled year-over-year, now at 8,500 dealers (about 1/3 of dealer base).

Product innovation and dealer engagement

• Digital Deal and Top Dealer Offer products are driving strong dealer adoption and incremental revenue.

• Top Dealer Offer up 30% sequentially, now with 500 dealers; addresses sourcing needs and improves inventory quality.

• Dealer Data Insight (DDI) and Next Best Deal Rating tools led to 1.7 million dealer actions YTD, increasing turn time by 40%.

• Over 50% of long-term dealers increased spend, driven by ROI from leads and value-added services.

• Digital Deal enables nearly full online transaction, improving efficiency and consumer experience.

Market dynamics and business model evolution

• Business is structurally growing, gaining market and wallet share, with limited cyclical exposure.

• Stable or normalized used inventory and lower interest rates are positive tailwinds.

• Growth in 2024 driven by new dealers at market rates, tier upgrades, and product adoption, with less impact from annual business reviews.

• Upselling to higher tiers increases average revenue per dealer by about 60%.

• Focus on optimizing unit economics in digital wholesale, with profitability improving despite volume declines.