การประชุมรายงานผลประกอบการไตรมาส 3 ปี 2026 ของ CARS: การเติบโตของมาร์เก็ตเพลส, อัตรากำไร EBITDA 30.7%

ประเด็นสำคัญ

• รายได้ในไตรมาส 3/2026 อยู่ที่ 181.9 ล้านดอลลาร์ เพิ่มขึ้นเล็กน้อยเมื่อเทียบเป็นรายปี และอยู่ในกรอบคาดการณ์ของฝ่ายบริหาร ขณะที่รายได้จาก Marketplace เพิ่มขึ้น 5%
• Adjusted EBITDA เพิ่มขึ้น 2% เมื่อเทียบเป็นรายปี สู่ระดับสูงสุดเป็นประวัติการณ์รายไตรมาสที่ 55.8 ล้านดอลลาร์ โดยมีอัตรากำไรอยู่ที่ 30.7% ซึ่งสูงกว่ากรอบบนของคาดการณ์รายไตรมาสอยู่ 120 basis points
• กำไรสุทธิเพิ่มขึ้นเป็น 16.3 ล้านดอลลาร์ หรือ 0.30 ดอลลาร์ต่อหุ้นปรับลด จาก 7.7 ล้านดอลลาร์ หรือ 0.12 ดอลลาร์ต่อหุ้นปรับลด ในช่วงเดียวกันของปีก่อนหน้า
• ARPD ของ Marketplace เพิ่มขึ้น 3% แตะ 2,532 ดอลลาร์ โดย Premium Plus คิดเป็นสัดส่วนมากกว่า 12% ของยอดสมัครสมาชิกทั้งหมด ซึ่งกำลังมุ่งสู่เป้าหมายสิ้นปีของฝ่ายบริหารที่ 15%
• CARS ยืนยันคาดการณ์ตลอดทั้งปี 2026 โดยคาดว่ารายได้จะเติบโต 0% ถึง 2% และอัตรากำไร Adjusted EBITDA อยู่ที่ 29% ถึง 30% ทั้งนี้ ฝ่ายบริหารคาดว่ารายได้จะอยู่ใกล้กรอบล่างและอัตรากำไรจะอยู่ใกล้กรอบบน
• การซื้อหุ้นคืนนับตั้งแต่ต้นปีจนถึงปัจจุบันมีมูลค่ารวม 74 ล้านดอลลาร์ คิดเป็นจำนวน 7.6 ล้านหุ้น โดย CARS ยังคงอยู่ในทิศทางที่จะบรรลุเป้าหมายการซื้อหุ้นคืนในปี 2026 ที่ 90 ล้านดอลลาร์

ผลประกอบการทางการเงินที่สำคัญ

ผลการดำเนินงานทางธุรกิจและการปฏิบัติการ

Marketplace ยังคงเป็นปัจจัยขับเคลื่อนการเติบโตหลัก โดยรายได้จาก Marketplace เพิ่มขึ้น 5% เมื่อเทียบเป็นรายปี ขณะที่การเติบโตของรายได้ในช่วง 9 เดือนแรกเกินกว่า 5% ซึ่งเป็นอัตราที่แข็งแกร่งที่สุดของธุรกิจนี้ในรอบ 5 ปี จำนวนผู้สมัครสมาชิก Marketplace เพิ่มขึ้นเมื่อเทียบเป็นรายปี และบริษัทปิดท้ายไตรมาส 3 ด้วยฐานสมาชิกสูงสุดเป็นอันดับสองในรอบ 3 ปี

ARPD แตะที่ 2,532 ดอลลาร์ เพิ่มขึ้น 3% โดยมีสาเหตุหลักมาจากการเลือกใช้แพ็กเกจสมาชิกระดับที่สูงขึ้น เช่น Premium Plus ทั้งนี้ รายได้จากตัวแทนจำหน่ายในรูปแบบสมาชิกเพิ่มขึ้นติดต่อกันเป็นไตรมาสที่ 5

นอกจากนี้ CARS ยังได้เปิดตัวแพ็กเกจ Starter แบบบริการตนเองโดยไม่มีค่าธรรมเนียมสำหรับตัวแทนจำหน่ายอิสระรายย่อย โดยมีตัวแทนจำหน่ายเข้าร่วมเกือบ 400 ราย และมากกว่า 60% ของผู้สมัครที่มีคุณสมบัติตรงตามเกณฑ์สามารถดำเนินการจนเสร็จสิ้นได้โดยไม่ต้องมีฝ่ายขายหรือเจ้าหน้าที่ช่วยแนะนำการเริ่มต้นใช้งาน ทั้งนี้ ประมาณ 80% ของสต็อกรถยนต์มีราคาต่ำกว่า 20,000 ดอลลาร์ หากนับรวมทั้งสมาชิกแบบชำระเงินและแพ็กเกจ Starter ทาง CARS มีตัวแทนจำหน่ายอิสระเพิ่มขึ้นเกือบ 600 รายเมื่อเทียบเป็นรายปี

ตัวแทนจำหน่ายแพ็กเกจ Starter ไม่ได้ถูกนับรวมในจำนวนตัวแทนจำหน่ายและ ARPD ของไตรมาส 3 โดยฝ่ายบริหารระบุว่า เป้าหมายเบื้องต้นคือการเพิ่มปริมาณสต็อกรถยนต์ราคาเข้าถึงได้และเสริมสภาพคล่องให้กับ Marketplace ส่วนการสร้างรายได้ในอนาคตอาจมาจากการอัปเกรดสมาชิก การจำกัดจำนวนลีด และบริการเชื่อมต่อเพิ่มเติม

ปริมาณทราฟฟิกและผู้เข้าชมที่เป็นผู้บริโภคลดลงในอัตราร้อยละหลักเดียวระดับกลาง แต่การลดลงดังกล่าวเริ่มชะลอตัวลงจากสองไตรมาสแรก ฝ่ายบริหารระบุว่าเป็นผลมาจากการตั้งใจปรับเปลี่ยนทิศทางไปเน้นผู้ซื้อที่มีความตั้งใจซื้อสูงและการเปลี่ยนเป็นลีด โดยยอดลีดเพิ่มขึ้นเกือบสองหลักเมื่อเทียบเป็นรายปี ขณะที่ Carson AI Shopping Assistant มีฐานผู้ใช้เพิ่มขึ้นเกือบเท่าตัวเป็นมากกว่า 1 ล้านรายต่อเดือน

Dealer Inspire ยังคงเผชิญแรงกดดัน โดยจำนวนตัวแทนจำหน่ายโดยรวมลดลงเนื่องจากยอดการสมัครสมาชิกเว็บไซต์ลดลง ขณะที่ CARS ยังคงปรับปรุงแผนพัฒนาผลิตภัณฑ์ต่อไป ความเร็วของเว็บไซต์บนมือถือได้รับการปรับปรุงให้เร็วขึ้นกว่า 40% จากช่วงฤดูใบไม้ผลิ และ Dealer Inspire VIN Videos รวมถึงฟีเจอร์การช็อปปิ้งด้วย AI มีกำหนดเปิดตัวในไตรมาส 4

รายได้จาก OEM และลูกค้าระดับประเทศลดลง 3% เมื่อเทียบเป็นรายปี แต่เพิ่มขึ้น 15% เมื่อเทียบกับไตรมาสก่อนหน้า ฝ่ายบริหารกล่าวว่าการใช้จ่ายปรับตัวดีขึ้นในกลุ่มพันธมิตร OEM ส่วนใหญ่เมื่อเทียบกับจุดต่ำสุดในไตรมาส 2

โครงการริเริ่มด้านต้นทุนและองค์กรช่วยประหยัดค่าใช้จ่ายในการดำเนินงานต่อปีได้ 30 ล้านถึง 35 ล้านดอลลาร์ โดยค่าตอบแทนที่ลดลง การลงทุนด้านการตลาดที่มีประสิทธิภาพมากขึ้น ตลอดจนค่าเสื่อมราคาและค่าตัดจำหน่ายที่ลดลง ล้วนมีส่วนทำให้ค่าใช้จ่ายลดลงเมื่อเทียบเป็นรายปี

แนวโน้มและคาดการณ์จากฝ่ายบริหาร

CARS ยืนยันแนวโน้มผลประกอบการตลอดทั้งปี 2026 ดังนี้:

• การเติบโตของรายได้อยู่ที่ 0% ถึง 2% โดยฝ่ายบริหารคาดการณ์ในปัจจุบันว่าผลการดำเนินงานจะอยู่ใกล้กรอบล่าง
• อัตรากำไร Adjusted EBITDA อยู่ที่ 29% ถึง 30% โดยคาดว่าผลการดำเนินงานจะอยู่ใกล้กรอบบน
• เป้าหมายการซื้อหุ้นคืนมูลค่า 90 ล้านดอลลาร์ ซึ่งดำเนินการไปแล้ว 74 ล้านดอลลาร์จนถึงสิ้นไตรมาส 3

ฝ่ายบริหารคาดว่าโมเมนตัมของ Marketplace จะดำเนินต่อไป โดยกำลังนำกลยุทธ์ด้านผลิตภัณฑ์ การตลาด และการขายในลักษณะเดียวกันไปปรับใช้กับโซลูชันสำหรับตัวแทนจำหน่ายและสื่อ เพื่อมุ่งหวังให้ธุรกิจเหล่านั้นกลับมามีผลการดำเนินงานที่มั่นคงหรือเติบโตได้ในปี 2027

นอกจากนี้ บริษัทยังรายงานการหารือเบื้องต้นที่มีสัญญาณเชิงบวกเกี่ยวกับข้อผูกพันด้านการใช้จ่ายของ OEM ในปี 2027 แม้ว่าจะยังไม่ได้ให้แนวโน้มคาดการณ์อย่างเป็นทางการสำหรับปี 2027 ก็ตาม

ความเสี่ยงและประเด็นที่ต้องจับตามอง

• ยอดการสมัครสมาชิกเว็บไซต์ลดลง ส่งผลให้จำนวนตัวแทนจำหน่ายโดยรวมลดลง และลดทอนผลกำไรบางส่วนที่ได้จาก Marketplace
• CARS กำลังลดการให้ความสำคัญกับ AccuTrade ในฐานะผลิตภัณฑ์แบบสแตนด์อโลน พร้อมกับผสานรวมขีดความสามารถด้านการแลกเปลี่ยนและประเมินราคารถยนต์เข้ากับ Marketplace
• รายได้จาก OEM และลูกค้าระดับประเทศยังคงต่ำกว่าระดับของปีก่อนหน้าแม้จะปรับตัวดีขึ้นเมื่อเทียบกับไตรมาสก่อน และฝ่ายบริหารคาดว่าแรงกดดันทางเศรษฐกิจมหภาคจะยังคงจำกัดการใช้จ่ายด้านสื่อในระยะใกล้ต่อไป
• แพ็กเกจ Starter ไม่ได้สร้างรายได้จากการสมัครสมาชิกในระยะแรก โดยฝ่ายบริหารระบุว่าอาจทำให้ ARPD ลดลงเมื่อมีการรวมฟังก์ชันการแปลงสภาพเข้ากับตัวชี้วัดที่รายงาน
• ปริมาณทราฟฟิกยังคงต่ำกว่าช่วงเดียวกันของปีก่อนหน้า แม้ว่าปริมาณลีดและแนวโน้มทราฟฟิกแบบออร์แกนิกจะปรับตัวดีขึ้นก็ตาม
• ฝ่ายบริหารยอมรับว่าเว็บไซต์ ตลอดจนผลิตภัณฑ์ด้านการแลกเปลี่ยนและประเมินราคายังทำงานได้ไม่เต็มศักยภาพ

ไฮไลต์ช่วงถาม-ตอบกับนักวิเคราะห์

ทราฟฟิกและการค้นหาด้วย AI: ฝ่ายบริหารระบุว่า CARS ให้ความสำคัญกับลีดที่มีคุณภาพมากกว่าปริมาณทราฟฟิก แม้จำนวนผู้เข้าชมจะลดลง แต่ยอดลีดเติบโตขึ้นเกือบสองหลัก นอกจากนี้ บริษัทยังอยู่ระหว่างดำเนินการเพื่อนำเสนอรายการประกาศและตัวแทนจำหน่ายผ่านการผสานรวม LLM ซึ่งรวมถึง Muse

การสร้างรายได้จากแพ็กเกจ Starter: แพ็กเกจฟรีดังกล่าวมีการจำกัดการใช้งาน รวมถึงการจำกัดจำนวนลีด โดยตัวแทนจำหน่ายอาจอัปเกรด ขยายขีดจำกัด หรือซื้อบริการเชื่อมต่อเพิ่มเติมในภายหลัง ทั้งนี้ ฝ่ายบริหารประเมินว่า ปัจจุบัน CARS เข้าถึงตัวแทนจำหน่ายอิสระได้ราว 20% ถึง 25% เมื่อเทียบกับสัดส่วนตัวแทนจำหน่ายในปัจจุบันซึ่งเป็นตัวแทนจำหน่ายแฟรนไชส์ประมาณสองในสาม และตัวแทนจำหน่ายอิสระหนึ่งในสาม

ธุรกรรมยานยนต์ออนไลน์: ปัจจุบัน CARS ไม่มีแผนที่จะแข่งขันโดยตรงกับตัวแทนจำหน่ายด้วยการซื้อหรือขายรถยนต์ โดยฝ่ายบริหารตั้งใจที่จะคงสถานะเป็น Marketplace ที่เป็นกลาง ซึ่งมุ่งเน้นการสร้างลีด เครื่องมือผลิตภัณฑ์ และการสนับสนุนธุรกรรมสำหรับตัวแทนจำหน่ายและ OEM

ความโปร่งใสด้านราคา: ฝ่ายบริหารระบุว่าความโปร่งใสด้านราคาที่มากขึ้นสอดคล้องกับกลยุทธ์ Marketplace ที่ขับเคลื่อนโดยผู้บริโภคของ CARS พร้อมกับยอมรับว่าตัวแทนจำหน่ายบางรายอาจต้องใช้เวลาในการดำเนินการปรับเปลี่ยนตามที่กำหนด

ความผันแปรในไตรมาส 4: ฝ่ายบริหารระบุว่าการใช้จ่ายงบประมาณด้านสื่อช่วงสิ้นปีอาจช่วยสร้างรายได้ส่วนเพิ่มได้ แต่ข้อมูลในปัจจุบันยังคงชี้ไปยังกรอบล่างของช่วงคาดการณ์รายได้ตลอดทั้งปี

บทสนทนาการประชุมแถลงผลประกอบการฉบับเต็ม

บทถอดเสียงฉบับเต็มของการประชุมทางโทรศัพท์ผลประกอบการ

คำชี้แจงจากฝ่ายบริหาร

Operator

Welcome to the CARS Third Quarter 2026 Earnings Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question and answer session. any time during this call require immediate assistance, please press star 0 for the operator. I would now like to turn the conference call over to Catherine Shen, Vice President of Investor Relations. Please go ahead.

Katherine Chen

Good morning everyone and thank you for joining us for the cars.com Inc third quarter 2026 conference call. With me this morning are Toby Hartman, CEO, and Sonia Jain, CFO. Toby will start by discussing business highlights from our third quarter. Then Sonia will discuss our financial results in greater detail along with our outlook. We'll finish the call with Q&A. Before I turn the call over to Toby, I'd like to draw your attention to our forward-looking statements and the description and definition of non-GAAP financial measures, which can be found in our presentation. We will be discussing certain non-GAAP financial measures, including adjusted EBITDA, adjusted EBITDA margin, adjusted adjusted operating expenses, adjusted net income, and free cash flow.

Reconciliations of these non-GAAP measures to the most directly comparable GAAP measures can be found in the financial tables included with our earnings press release and in the appendix of our presentation. Any forward-looking statements are subject to risks and uncertainties. For more information, please refer to the risk factors included in our SEC filings, including those in our most recently filed 10-K, which is available on the IR section of our website. We assume no obligation to update any forward-looking statements. And now, I'll turn the call over to Toby.

Tobias Hartmann

Thank you, Catherine, and thanks to those joining us to review third quarter 2026 results. We delivered another quarter of steady execution against our financial and strategic goals. Q3 revenue of 182 million was within our guidance range and up slightly year over year. marketplace, where we have been continually improving value delivery and winning customers, grew revenue by 5% year over year. And in keeping with our focus on development velocity, we launched our first self-service marketplace offering to better attract and serve the smaller independent dealer segment. Adjusted EBITDA margin of 30.7% outperformed the high end of guidance for a third consecutive quarter. This also translated to a new quarterly record of adjusted EBITDA dollars. Finally, our strong free cash flow generation enabled targeted organic investments as well as capital return to shareholders.

We are on pace to achieve our $90 million share buyback target for fiscal 2026. Looking back on the year, we made a steady arc of progress with improving fundamentals, tangible momentum, and an accelerating pace of innovation. Revenue and adjusted EBITDA have grown in tandem each quarter year-to-date. This largely resulted from deliberate reprioritization of marketplace, our most scaled and differentiated asset. Unlocking marketplace opportunities was the fastest way to inflect financial performance and help identify and drive the foundational changes needed to shift the long-term trajectory of the business. These changes fall into the three categories we outlined on our February earnings call, each of which we've substantially advanced through the year. First, jump-starting product innovation. We have meaningfully shortened development cycles, enabling us to quickly iterate on AI tools like Carson to stay ahead of changing consumer shopping habits.

We also began the phased rollout of dealer verified listings, which ties together the marketplace and appraisal layers of our product platform for the first time. Launching new products can be a long and iterative process, but our path is clear, and we are becoming a more interconnected and trusted marketplace for consumers, dealers, and OEMs. Second, making sure we optimize our cost base and processes. Shortly after I joined, we quickly made significant changes in April to reduce silos and management layers to speed growth and eliminate duplicated efforts. Other, smaller organizational adjustments were also completed over the past few months to further align our resources to our roadmap. In aggregate, ongoing cost containment efforts yielded 30 to $35 million in discrete annualized operating cost savings. and related, we are putting the right people in critical organizational roles. I am pleased to officially welcome Trent Ziegler, our new CFO and Mohsam Baath, our new Chief Product Officer.

Both are seasoned professionals, adept at moving quickly to build leading digital businesses and marketplaces, trusted products, and interconnected product ecosystems. Their skills and perspective will be extremely valuable as we evolve toward a product-led growth model. Focused execution across these three initiatives has put our marketplace business back on a growth path. Marketplace revenue growth for the first nine months is over 5%. The best growth rate we've delivered in the last five years. Marketplace subscribers remain at a healthy level and were up year over year. And Marketplace ARPU reached another all-time high after setting a new record only last quarter.

Over the long run, we believe marketplace growth will be increasingly product-driven, for example, through offerings like our new self-service starter package. We said before that the first step to powering the marketplace flywheel is attracting and harnessing relevant inventory such as affordable vehicles. And our surveys show that 50% of recent respondents are delaying a car purchase due to affordability. We identified a market gap we could meet, quickly invented and built a new product that did not exist before, and we are seeing promising early results. Starter packages are an extremely timely addition to our portfolio as we attract local smaller dealers whose lower priced vehicles are exactly what consumers are seeking online. Almost 400 dealers have already signed up for the starter package. And roughly 80% of vehicle inventory from starter dealers is under $20,000, squarely in the sweet spot for in-market shoppers.

Practically speaking, this is also a highly efficient channel that requires zero sales or onboarding assistance before dealers begin listing with no fees. Although we are still making product changes and tweaks, more than 60% of eligible sign-ups have been fully self-service. This is exactly in line with our emphasis on better, more scalable processes and a great example where we are doing more with less. Beyond offering more breadth of inventory, we have also improved how consumers find the right car using AI. On platform, our Carson AI Shopping Assistant almost doubled its user base year over year to surpass one million monthly users during Q3. Our data clearly shows CarGurus's growing utility and trust among marketplace shoppers. However, queries of six or more words have nearly tripled year over year.

We also saw a 72% year over year increase in queries that only state vehicle needs without any OEM brand preference. This points to the significant opportunity for us to engage with consumers and provide them with tools and trust signals for their decision journey. Furthermore, around 91% of users rated CarGurus positively over the last six months. Carson is elevating the consumer experience on our platform. Off-platform, third-party data shows that Cars.com continue to lead automotive marketplace peers in the number of citations by the largest LLMs in Q3. And we are also in the process of integrating our MCP with Muse to surface our vehicle listings and dealers to more users. Overall, consumer scale and engagement on Marketplace remains healthy and is trending up thanks to ongoing product improvements and optimization of marketing investments.

Q3 traffic and visitors were down only mid-single digits year over year, a much lower decline versus Q1 and Q2. As a A reminder, we intentionally shifted our focus to prioritize value delivery, target high intent shoppers, and drive lead conversion. We explained this during our last call. So we are pleased to report that lead performance was up nearly double digits year over year in Q3 and a direct result of more rigorous and targeted investments. Just as we saw last quarter, solid Q3 marketplace growth tells us that customers are responding well to our pivot. We took a disciplined approach to drive the metrics that truly matter for growth, and our strategy is working. Stepping back, we believe our marketplace has strengthened materially over the past nine months and is well positioned for long-term growth.

For consumers, listings today are more user-friendly, have more trust signals and AI integrations, and drive more engagement. Proprietary data like dealer-verified listings and soon-to-come review badges, pricing breakdowns, and other features add to a richer cars.com experience. These are long-term marketplace differentiators and key to sustaining our high brand recognition among car shoppers. Case in point, Q3 organic traffic volume grew year over year and organic traffic as a percent of total traffic was at its highest level in nearly two years. And for dealers and OEMs, we continue to advance product innovations such as VIN and lead-specific intelligence and AI solutions to drive more car sales. As I explained earlier, we strategically focused on Marketplace first because it is our core. Now we're adapting the Marketplace playbook and applying our product, process, and people tactics to transform our website business.

Over the past six years, Dealer Inspire has grown from a disruptor into a scaled player, meaning future customer wins will hinge on product innovations rather than OEM endorsements. We have identified how to be a better partner to customers and we are taking decisive action. In Q3, this work was behind the scenes, strengthening the foundation of our platform. Mobile site speeds have gotten more than 40% faster since spring, an important customer metric where we focused on moving the needle. We launched inventory endpoints built for AI agents in May, and they have become one of the most visited parts of our platform as we help customers adapt to LLMs. We have also laid the groundwork to connect DI and cars.com to allow us to deliver a more personalized and unified consumer shopping experience. We pointed last quarter to adding current marketplace capabilities into DI, particularly related to AI.

DI VIN Videos, utilizing the technology that we showcased at NADA in February for Marketplace and Media customers, is coming to DI in Q4. Our native integration auto-generates vehicle summary videos for every vehicle on the lot to produce more engaging websites and syndication with no additional overhead for dealers. Leveraging the success of our Carson Assistant on Marketplace, similar AI shopper tools like search, recommendations, and VDP summaries will be embedded into DI websites in Q4. These are some of our ongoing improvements to make our websites best in class, and you'll see us continue to roll out enhancements steadily as part of our new platform roadmap. We are confident that we can stabilize website development and improve its growth outlook in 2027, as we have demonstrated for Marketplace over the course of this year. In closing, I'd like to acknowledge both the important progress we've made since the start of the year and the work that is to come. Recognizing the marketplace as our growth engine and reorienting the business to drive that flywheel meant a comprehensive overhaul of our strategy, investments, and organizational structure.

Undertaking this hard work helped us return Marketplace to year-over-year growth and its highest year-to-date revenue level in six years. costs are down while overall productivity and efficiency are up. We have filled key roles that will help push our growth and product agenda in 2027 and beyond. However, we are still in early innings and several parts of our platform are not at their full potential. There will be near-term headwinds for point solutions like websites and trade and appraisal while we are working to reshape those roadmaps. but we are energized by the work ahead and confident in the growth opportunities our strategy creates. Before we get into the financial results and in light of our upcoming CFO transition, I want to take a moment to recognize Tonia and her many contributions to CARS over the past six years. She has been essential in driving the company forward, relentlessly finding avenues to improve performance and positioning us for success as we enter the next phase of our growth strategy. Not to mention she has been an invaluable partner to me as well as a leader and mentor across our organization.

We are glad that she will be with us for a while longer to ensure a seamless handover to Trent. Thank you, Sonia. Now I'll turn it over to Sonia to discuss our financial results and outlook.

Sonia Jain

Thank you, Toby. Being CFO of CARS has been a true honor. I'm deeply appreciative of my talented colleagues and the finance team, and I'm proud of what we've accomplished together. I also want to thank our investors and analysts for their support and partnership over the years. CARS is in good hands, and I look forward to seeing its continued transformation under Toby and Trent. Now, turning to the financial discussion. In the third quarter, we executed on near-term growth opportunities while also delivering strong adjusted EBITDA and net income gains, with adjusted EBITDA outperforming our guidance range. Our pace of product development continued to accelerate, with exciting launches like with new starter packages adding momentum to our marketplace flywheel.

Q3 revenue of $181.9 million was driven by similar dynamics as first half performance. Subscription-based dealer revenue was up year-over-year for the fifth consecutive quarter. While OEM and national revenue recovered nicely from its Q2 trough, it was still down slightly year-over-year, weighing on total revenue growth. Further unpacking dealer revenue, our marketplace strategy continues to deliver from both a dealer footprint and listings growth perspective and value delivery that we're unlocking in the form of ARPD growth. We extended our streak of growing marketplace customers in Q3 and exited the quarter with our second highest subscription base in three years. With the launch of our new starter offering, we now also have the ability to offer marketplace capabilities to independent and smaller local dealers at no upfront cost. As Toby mentioned earlier, there are numerous benefits to expanding beyond traditional subscription packages.

The self-service aspect of the starter represents an efficient and scalable channel for acquiring listings inventory and also increases our presence with independent dealers. Between paid subscriptions and no-fee starter packs, we've added close to 600 independent dealers onto cars.com year over year. ARPD grew another 3% year-over-year in Q3 to $2,532, just shy of a new record. The largest driver of growth was robust uptake of higher-tier marketplace subscriptions such as Premium Plus. In May, we set out a goal to grow premium plus adoption to 15% of mix by year end. And I'm pleased that we crossed the 12% mark in Q3. Marketplace progress, while very encouraging, was partially offset by challenges in dealer solutions and media products.

Consolidated dealer count was down year-over-year in Q3 due to a decline in website subscriptions. We've been transparent about ongoing development work to augment our feature set and also better integrate platform capabilities into websites. Upcoming AI-related enhancements for Dealer Inspire are just one example of our progress as we seek to return this part of our platform to healthier growth. We also made a deliberate decision to de-emphasize AccuTrade as a point solution in favor of more integration into Marketplace. Lastly on revenue, OEM and national revenue was down 3% year-over-year and up 15% quarter-over-quarter in Q3. This performance was largely in line with our expectations, and we were encouraged to see improved spending by a majority of our OEM partners. Now turning to our Q3 cost discussion.

Third quarter operating expenses were $153 million, down 7% year over year. Roughly half of the year over year improvement stemmed from lower costs and improved efficiencies. The remaining benefit resulted from lower depreciation and amortization expense, following the full amortization of customer lists tied to our 2017 spinoff. Q3 adjusted operating expenses were $142.4 million, down 5% year over year from largely the same factors. For the following line item detail, all comparisons are on a year-over-year basis, unless otherwise noted. Services and technology expenses were down low single-digit percentages on both a reported and adjusted basis. On balance, lower compensation expense was partially offset by slight increases in third-party software and hosting costs, netting out to a minimal year-over-year change.

Marketing and sales decreased roughly $2.9 million on a reported basis and $2.6 million on an adjusted basis, driven by more efficient marketing investments as we optimize our audience acquisition strategy to drive value delivery. General and administrative expense was down $3 million on a reported basis and up $1.6 million on an adjusted basis. The reported variance was primarily due to the expiration of the D2C earn-out accrual. Recall that the D2C earn-out accrual is excluded from adjusted operating expenses, which resulted in adjusted G&A expense increasing year-over-year from certain third-party costs. As Toby mentioned, our diligence on process and organizational optimization has yielded strong cost benefits in 2026 and also provides us with forward flexibility to reinvest resources to execute our new roadmap while preserving a portion of savings to benefit adjusted EBITDA. Third quarter net income was $16.3 million, or $0.30 per diluted share, compared to net income of $7.7 million, or $0.12 per diluted share, a year ago. income was primarily driven by improved operating income. Adjusted net income for the third quarter was $32.3 million or 58 cents per diluted share compared to $30.4 million or 48 cents per diluted share a year ago.

Adjusted EBITDA of $55.8 million in the third quarter was up 2% year-over-year, delivering robust operating leverage from steady gains in cost, process, and organizational efficiencies. Our resulting adjusted EBITDA margin of 30.7% overachieves the high end of our guidance range. by 120 basis points. Moving on to cash flows and the balance sheet. Net cash provided by operating activities totaled $114.7 million for the nine-month period ending in Q3, compared to $114.5 million a year ago. Free cash flow was $97.3 million over that timeframe, up from $94.5 million a year ago. Share buybacks totaled 7.6 million shares for $74 million year-to-date through Q3, putting us well on pace to achieve our 2026 share repurchase target of $90 million. Our 2026 buyback activity represents over 12% of the outstanding share count from the start of the year and reflects our commitment to return value to shareholders.

In terms of debt, year-to-date total debt repayments of $10 million reduced total debt outstanding to $445 million as of September 30th, 2026. Total liquidity was $369.6 million as of September 30th, 2026, providing strong financial flexibility to support our growth priorities and other capital needs. Now, we'll conclude with Outlook. We are reaffirming our full-year 2026 guidance of flat to 2% revenue growth and adjusted EBITDA margin of 29 to 30%. Bearing in mind our year-to-date performance and current trends, we expect revenue towards the lower end of our outlook range. We anticipate tailwinds for Marketplace to persist, and we are pleased that our focused execution in 2026 has improved Marketplace's growth trajectory. We're acting with urgency to apply those those product marketing and sales tactics to solutions and media products and move that portfolio from near-term declines back to stable to growing performance in 2027. The same is true on a smaller scale for OEM revenue, where we're assuming that near-term macro challenges will continue to temper media investments, but also see encouraging initial signals for 2027 spending commitments.

For adjusted EBITDA, we are currently anticipating full-year performance to be at the higher end of our guidance range. Proactive cost management and efficiency gains are yielding strong operating leverage that we expect to sustain through the remainder of the year. And with that, I'd like to open the line for Q&A.

Operator

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press the star followed by the one on your touch-tone phone. Should you wish to cancel your request, please press the star followed by the two. If you are using a speakerphone, Please lift the handset before pressing any keys. Please note to only limit yourself to one question and one follow-up. Once again, that is star 1 should you wish to ask a question. And your first question is from Naveed Khan from B.

Riley Security. Your line is now open.

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Naved Khan

Hi there, this is Ethan Wydell on for Naved, thanks for taking my question. First For starters, can you give us a little additional color on traffic to your website and maybe impact that you're seeing from Google's changes to search? And then you mentioned, you know, inventory agents for AI. Can you maybe double click on new traffic sources that you're exploring with agents and LLMs and any early traction there? Thank you.

Unknown Speaker

Good morning. Thanks for your question. With regards to traffic to the website, I think we've outlined our strategy, which was that we would de-emphasize a little bit just driving traffic as opposed to driving leads. I think we're very happy that this strategy has worked. So traffic and UVs are down. from first half levels and that we've seen we're de-emphasizing still the traffic but we drove nearly double-digit increase on leads so you're basically seeing that the strategy on efficiency works The other thing to mention is Carson. We had mentioned that we saw about 1 million users now. So it's really an embedded part now of our discovery search and then leading to incremental engagement with users. So we are very pleased about that.

And the last point to close out is, we're also working on an integration with news that should follow in the next couple of weeks. We've had preliminary discussions and also some tests and trials and that also looks promising. Thank you.

Naved Khan

Thank you, that's helpful. And then, can you maybe tell us more about what you're seeing in OEM ad spend and maybe what your expectations are as we look towards 2027?.

Sonia Jain

Yes, thank you for the question. We're pretty pleased to see the recovery in OEM spend from Q2 to Q3. We had mentioned that Q2 was going to be a trough, and we see good activity as we head into Q4 on the OEM. We're not really giving formal 2027 guidance yet, but this is the time of year when we sit down with OEMs around upfront planning for their fiscal. And those conversations have been positive. I think one of the things we observed in Q3 is almost all of our OEM partners that we were working with were increasing spend levels. So it's nice to see them be a little bit more front-footed than we saw earlier in the year in how they are thinking about investing and investing in our platform.

Thank you. I appreciate all the color.

Operator

Thank you. Your next question is from Gary Prestopino from Barrington Research. Your line is open.

Gary Prestopino

Hi, good morning, all. This self-service product for the independent dealer market, did I hear you right that there's no upfront charge for taking this on and if there isn't, what's the revenue stream?.

Unknown Speaker

Yeah, thank you for your question. You are correct. The self-service starter offering, as we call it, is focused on smaller, more local, and predominantly independent dealers. Okay. And the idea is very simple. We follow the principle of listings traffic money, which means we need to have the relevant inventory on our marketplace. And we saw that we had a gap, but there's a product need and there's a market need because due to the affordability issue in the United States. there's more demand for, call it more value offering in terms of car segments. So let's say up to €20,000, that's really a segment where we had not really a strong offering. So we're closing that product gap by bringing on those dealers literally as a self-service starter pack, so to say, And once they're on and once they experience the power of our marketplace, there's other solutions down the road that for competitive reasons I'd not like to talk about in this call that we can then bundle and interconnect with going forward.

But, yes, you are correct. At first, it's a free, so to say, startup package to have them experience the power of our marketplace.

Gary Prestopino

Okay. And then, you know, in terms of when you say it's self-service, I mean – How does it differ in a sense of what your normal marketplace offering is to a franchise dealer? You know, X-ing out all the, you know. other add-ons that a franchise marketplace dealer can get.

Unknown Speaker

I'm glad you're asking that question. It's a great question. So to be transparent, it's true. really knew what we felt there because self-service means that there's no hand-holding or you know hands on a keyboard that we need to enable and to get that partner or to get that local dealer started so in other words we We reach out to them and they push a button and everything pops in, listings are populated. They see their inventory on Marketplace, they get a reporting, they get a cockpit, they get KPIs and part of our ecosystem. That did not exist. So the way we operated before and also for larger dealers is a lot of hand-holding, a lot of manual processes in order order to connect to the various systems, the dealer-related systems, the MarTech solutions, and so forth. So it is a really, truly an innovative new product that the teams have put together and And the amount of time it took to put it together exceeded. our own expectations. So we'd be very pleasantly surprised And we have about 60, 65% of all these new local smaller dealers using it as an auto service. jump started as opposed to a manual process that we need to go through before. That really explains it. That's what we mean by self-service.

Okay. Thank you.

Operator

Thank you. Your next question is from Marvin Fung from U.S. Bancorp. Your line is now open.

Marvin Fong

Great, good morning. Thanks for taking my questions. Yes, I'd like to also ask about the starter package. So with other freemium products or free products that we see in the market, now they're like, for instance, I believe like leads are anonymized and things like that nature. So are you doing a similar thing and sort of to incentivize these dealers to kind of eventually upgrade to the subscription package. And then second part of the question is this sort of like, do you kind of envision, I mean, is the next step put on your base package or are you kind of contemplating developing something in between like the free package and the contract? current standard package you offer to kind of like help them stay in the ecosystem and advance up the tier system.

Unknown Speaker

Yes, thank you, Marvin. Highly relevant question. I should have mentioned that earlier, so I'm glad you picked up on that. Yes, of course, just like with any other premium product you see as a consumer that you're all observing in the market, there are certain caps and there are certain limitations. to how you can consume that free startup package. One of the dimensions, obviously, is our core currency in terms of leads and the number of leads we are providing. And then, of course, And that also ties to some product work we did and we've accelerated in the past couple of months, which is the so-called DLE, the dealer lead engine. getting more sophisticated in how we're distributing leads, how quickly we're distributing leads. And if you hop on as a new partner, obviously, you'd like to have a positive experience very early on. You wouldn't want to wait for three to four weeks for the first lead to come through.

We are sophisticating our processes around that in terms of ramping up new customers creating a positive experience, but then also telling them, hey, you're running into a cap, so now if you'd like to stay on, you either have to upgrade or you gotta talk to us. And that's the journey that we're currently on. So the idea is that there's additional offerings wrapped around that in the spirit of interconnectivity, as I talked about at the time, The idea is that there's different levels in terms of caps. You could extend a cap or you could lower a cap. And then there's the idea of offering other services that are not directly tied to the pure marketplace, but that could be tied to the digital presence, i.e., the website, the and or also to a future program around Verified. Thank you.

Marvin Fong

Thank you. Got it. And if I could do a follow up, maybe for you, Sonia, just sort of like on the financial impact or how should we think about the impact of the starter program on like ARPD? I'm assuming these dealers will be in the dealer count they were in this quarter. Maybe ARPD might be affected or you can kind of overcome it.

Sonia Jain

So I think in sort of the very near term and very specifically in terms of the Q3 numbers we've shared with you, the starter dealers are not included in our dealer count and therefore are also not having an impact on ARPD. As you think about this longer term, I the real thesis behind Starter Pack is how do we get more listings onto our platform, particularly attractive, you know, affordable listings. That's the primary goal. We don't view Starter Pack as a long-term driver of ARPD because it will likely be dilutive to to the ARPD calculation once we have the conversion feature built in, this is largely oriented towards smaller independent dealers, but they're not included in the Q3 number. And we do believe that this is a component of the overall marketplace flywheel, right? listings bring eyeballs which allow us to drive more value to both consumers and our customers.

Tobias Hartmann

Yes, and to build on what Sonia stated, we view this from two dimensions. We view this one in terms of there's a future impact through indirect monetization, which is what Sonia just alluded to. The more listings, the more inventory, the more market share you have down to townships, zip codes, DMAs, and so forth, dealership-level value buckets, the more attractive the overall marketplace experience becomes, which leads to opportunities how you can monetize not directly but indirectly through other parts of the market. the ecosystem. And the second one is the direct monetization layer that I touched on before, which is playing around with throttles around. lead caps, other caps, other services wrapped around an interconnectivity. Hope this clarifies it. Thank you.

Marvin Fong

No, that was very helpful. Thank you. And Sonia, best of luck on the future endeavors. Thanks.

Operator

Thank you. Your next question is from Josh Patois from J.P. Morgan. Your line is now open.

Unknown Speaker

Good morning, and thanks for taking my questions. Sonia, it's been a pleasure working with you, and best of luck. Just congratulations on the continued product momentum. My first question is just on transactional capabilities. You know, with consumers increasingly embracing online vehicle purchases as reflected in, you know, Carvana's growth and activity across other marketplaces, How are you thinking about cars.com extending further into the transaction itself? Is there scope to accelerate investment in end-to-end purchasing capabilities? I think you mentioned an upcoming news integration, so maybe any additional flavor there would be very helpful. Thanks, and I have a quick follow-up.

Tobias Hartmann

Thanks, yes, I'll start off with that one. Another good question. The way we are thinking about our positioning and the future evolution is we are really here not to compete with our customers. So anything that's more headed into direction of buying or potentially getting really deep into the transaction itself, I would say right now is not where not core. And why not? Because our place to be is we want to be a trustworthy, a trusted and authoritative partner to seekers, to buyers, to dealers, to OEMs as a neutral platform partner that enables and empowers and supports facilitates our customers transactions, but that doesn't mean that we ourselves get into the transaction. So you should not expect us to see CapEx investments into picking up cars, selling cars, whatever, as opposed to really driving lead volume, driving highest quality of leads, driving innovation for local dealers, franchise, major dealerships, and helping them figure out how they can drive a better P&L. That's really our place to be.

Unknown Speaker

That's very helpful. Thank you. And just as a quick follow-up, the FTC pricing transparency enforcement has created a range of varied behaviors across the marketplace. I'm wondering if you could just talk about how that has changed, how dealers interact with cars.com, how it's changed. they shifted their listing behavior and you know what pricing trends are looking like thanks Yes, so.

Tobias Hartmann

Another really good question that lines up with what we just talked about, the positioning of our current platform and how we're thinking about it, we want to be consumer-led, to be clear, which means we are doing the right thing by the consumers. there will always be instances where customers, i.e. B2B customers, may have a different view because Short term, they will not share the same view or they may say, look, there's hidden costs or expenses and it's hard to transparently show all of that. But our mission and our job is to put everything on the platform to guide the consumers as part of a neutral marketplace, positive marketplace experience. So the changes that were implemented as part of the FTC requirements are largely welcome because it provides more transparency and it standardizes the way how B2B customers ought to interact with regards to price transparency. So it's fully in line with our understanding of our role, our objectives, and we fully support it. Now, having said that, there will always be individual dealerships or individual customers who for good or bad, reasons cannot make that happen overnight. And we also respect that because they're our customers.

But we as a platform operator, We want to do the right thing by the consumer. Understood. Great color. Thanks and good luck.

Operator

Thank you. Your next question is from Joseph Spak from UBS Financial. Your line is now open.

Joseph Spak

Thank you. Good morning, everyone. I was wondering if you could maybe help us think about how to size this opportunity, particularly that relates to the marketplace starter packages. Because if I look at your dealer count, a little bit over 19,000, there's 40K US franchise independent dealers, but probably, what, 18K or so franchise. It's maybe almost half and half, but I don't really have a good sense, I guess, of your dealer exposure, maybe the share within each of those franchises versus independents because So, you know, like how much room do you think you have to go on the independent side from this initiative? Yes.

Tobias Hartmann

Yes, thank you. So there's roughly call it probably north of 20,000 indies out there. and we are under penetrated, clearly under penetrated. What we'd like to bring across during this call and as we will have further conversations with all of you in the next couple of quarters Again, we don't want to call out, oh, this is a huge monetization potential right now, because it's part of an ecosystem approach. again, there's a direct and there's an indirect monetization path. We believe this is strategically, operationally, and also for the long-term positioning of our marketplace absolutely crucial that we welcome these local dealerships, these independent dealerships. And we also think as of today that we have very specific assets in our portfolio that we can enrich the offering beyond a pure listings and marketplace experience, that could be actually a pretty prominent USP. This is a part of our product roadmap for 2027. If you think about what's the opportunity, the opportunity is first inventory liquidity. We bring on additional inventory where we have to.

Unknown Speaker

data insights, what drives eyeballs, what drives the attractiveness of a marketplace. The second piece is we learn because we're getting additional signals in terms of supply and demand signals to connect the dots. what it means to help consumers guide and take and make a better decision. And the third piece is as listings, pure listings, become more or less a commodity going forward, the question is, what's a listing going to be on our marketplace versus a listing on another marketplace? And there we have some cool things in store that we will develop over time. And we want to make sure that it independent dealers and local dealers get access to that. So we're developing it, if you will, from an enterprise grade point of view, because we came from the large dealers and they're the backbone, and they're really helping us think this through, you know, at the highest level of requirements and what's really needed to succeed in the market. But then we're taking this down like an enterprise grade level to the local dealerships. And that's why we think this is a powerful project.

Sonia Jain

product path going forward. And maybe, Joe, just to give you some numbers, if you're trying to put some boundaries on this, we probably would say the mix is a little bit more heavily weighted to Indy's when you think about the overall TAM. So when you think about our dealer mix, we'll roughly call it two-thirds product. franchise, one-third independent. And that then translates into having, call it like a 20 to 25 percent penetration rate amongst independent dealers, which is why we're so excited about the opportunity with the starter package. It's a really efficient and scalable way for us to get after this segment.

Joseph Spak

That's helpful. Maybe a quick follow-up on that and then sort of a second question. Is there an opportunity for a... somewhat similar package for larger dealers that are not currently using cars.com. And then, um, you know, the following second question is just maybe Sonia on the specifically on the fourth quarter guidance. Um, you know, it's a pretty wide range since you didn't really sort of, on EBITDA for the fourth quarter, since you didn't really touch the full year number, I think it's like plus or minus 10%, just what would sort of, you know, you typically have pretty good visibility, but so I'm just curious sort of what would cause you to come in sort of, you know, higher end versus lower. Thanks.

Sonia Jain

Yes, maybe we'll take the guidance question first. So we did try to provide some indication. We've reaffirmed full year, but given where we are in terms of year-to-date performance, we expect to come in toward the lower end of that range. on revenue and towards the higher end when it comes to adjusted EBITDA. I think there's a couple different puts and takes, again, we've leveraged year to date performance, in order to steer folks to the right portion of the guidance range. And I would say Q4 is also like an interesting time of year as people spend down their marketing budgets. There's often opportunity for us to collect incremental dollars, particularly on the media side, which could move us maybe closer to the midpoint of the range. But what we're saying right now is given the information that we have today, we would expect to land towards the lower end of the revenue guide range.

Tobias Hartmann

Yes, and your question regarding other customer segments and larger dealerships, It's really a different product. That's why we started from scratch. You know, our experience is if you start to tweak your existing large enterprise kind of packages and say, okay, let's do the exact same thing, but now let's try to bring it down for smaller customers or local, that's one approach from my experience that's kind you gotta start from scratch and almost like start with a whiteboard and say, look, let's make this as convenient as possible and let's think about what these customers really need. So that's how we approached it. So there are more differences and nuances between our our larger customers packages and subscription tiers versus the startup package. Now, having said that, we will learn from both ends. So what we didn't talk about is you know, we've already collected rich data signals from the engagement with those, you know, 400 dealerships that we just brought on recently, which will have an impact in terms of development cycle and innovation for the larger enterprise clients.

So it goes both ways, but there are different packages, there are different clients and customer segments, and there are different nuances in terms of obviously pricing and features.

Operator

Thank you so much. Thank you. There are no further questions at this time. Ladies and gentlemen, the conference has now ended. Thank you all for joining. You may now disconnect your lines.

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