Earnings call transcript Q2 2023

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Operator

Good day, and welcome to the TrueCar Second Quarter 2023 Financial Results Conference Call. Please note this event is being recorded today. I would now like to turn the conference over to Jantoon Reigersman, President and Chief Executive Officer of TrueCar. Please go ahead.

Jantoon Reigersman

Thank you, operator. to quarter welcome call. earnings and everyone TrueCar's XXXX second conference Hello,

our letter, me our market relations had at you read Luong, is closed the ir.truecar.com. quarter Financial to Joining on Teresa website hope and Chief is today our yesterday was which released Officer. available I opportunity second after stockholder investor all

those on forward-looking we Before want to I should can of We our statements. by Safe you will confident similar making results. Report our by to of we be could or caution intend, factor Harbor. risk XX-K. the get These target, review Form started, believe, Annual relied words I need become, this from on results forward-looking our not future expressions section contemplated identified be such performance statements you on as seek, of guarantees and will, forward-looking statements expect, read that Actual call. and the anticipate, to use remind materially be plan, differ as

date, available update statements to any disclaim reports forward-looking law. Form our this statements for by with on forward call of Commission our except Securities today's we looking make to based and and the the any on materially. us XX-Q reports Exchange on filings discussion differ information The that to and could and results we of factors cause a as quarterly obligation as Our required

are or relations in to direct a and GAAP section investor discuss intended at GAAP to of also considered non-GAAP in will results forth accordance to non-GAAP we as prepared be financial isolation The certain GAAP. set non-GAAP website our in measures with substitute be comparable measures, addition, for most measures ir.trucar.com. financial measures not In of all are the the reconciliations

fun. was That

a It I so, that, of provide at an with the stuff. exciting is will real now TrueCar. get we the into quarter time summary Now

growth and improve bottom ship revenue by time on the of are targeting achieved significantly In more year-over-year our those in we're business. double organization are growing a and it or focus. all we focused QX. -- positions in Okay, streamlined In We've revenue their turned a of the always step a EBITDA and line as mid-June, XXX change was eliminated of company. followed headcount, digit difficult and to growth, these QX, laser XX% important adjusted company it's growth an be nimbler profitability time and QX focused decisions, revenue quarter-over-quarter we

over excited to transform diamonds for the that those pull many together many so to shine, have in the come rough quarters we're long-term We ready and success. are to business this

value did our of our example, electric of that to We redefine an Tesla disrupt have is a our XX% throughout in cohorts. to consumers markets supply more nationwide and As the and dealers available than TrueCar? opportunity excluding vehicles know unique both various you propositions

We're on And excited in on launch to we'll our we this journey with us. the coming bring you as along more cohorts. quarters this elaborate

our open questions operator, Now, analysts. from call let's the for

Operator

[Operator Instructions]

first Rajat come Morgan. J.P. from our with And will here Gupta question

Rajat Gupta

And you to quick prepared the just And work I up. I follow about about understand to big activations anticipate the driver a obviously as could thinking how well. to a on continue the of in forward, going did like send cadence OEM nonrecurring here the revenue, of have here? EBITDA do quarter, be and the Thanks even should us these contribution, Great. see the the help think remarks. And third you second Thanks. and quarter programs we aspect the for recurring incentive and the sequentially. And levels Good solid how of pickup sustainability a versus this. taking for the morning. big have question the the question you pretty how

Jantoon Reigersman

for much question. so your Absolutely. Hi, Thanks Rajat.

an over So on the see to out It of of we're And this last OEM obviously OEM couple the coming the incentives obviously, dried been years. business past. yes, for back. part excited reasons. has is two we're great it's important excited revenue, our One in

it's coming back. piece OEM interesting, of see is Not combination to partners. also affinity doing together incentive that so only And this the this our exciting with the it's really is being

So all as stakeholders value it is we of of the the have those provide which combining various also involved. articulates to and platform the strength together TrueCar, really

things types type doing and hope these valuable And so grow incredibly is in do Mercedes we Express that more a to obviously do the hope us. of to all combination a we as case, this the go ebbs macros to business American in term term with bit flows believe for the over parties is time, growth of this something with always And programs, Club but we of of Sam's involved. this little be expect for near and and and resetting, longer it business still will

Rajat Gupta

quarter, quarters? what on second few that that, a like, manufacturers? USA be go do --? is it Got would by NBA, we Like it. mean, resold does for in curious, just the -- other program I

Jantoon Reigersman

question. a it's Yes,

individual So like almost yes, programs. these are

always programs program obviously as they they, similar well. the well, establish and program, the it's then type we players to hard to run the of or with a we down have So continue other predict we way as slow program determined works to do

give So it's bit and take. a of little

what yes. working on It's answer effective. then will That's moment. time? growth something hard continuing basis. revenue And program, obviously ongoing it's this the the is these always. flow, that at other always not much. with are because like very very to always is been teams say, replaced This it's steady an The has obviously hey, But all be this over are the necessarily so we're is programmatic And programs

that no. type OEM with so is over and of Will perfect we probably is you yes. line? a a that will on tractions can expect answer more we and time, programs? And the variety The side answer The these do of straight have be greater more revenue

Rajat Gupta

OpEx. latter lower part quarter, a And this, thought is would second would helpful. the third effect it quarter the guidance very executed, I'm of actions. curious, the full flattish sequentially, what with for the then have I of And is The the would go I That's OpEx are. action your Understood. the say question like OpEx was on just cost

You if talked about any of cadence needed the Thanks. the you could additions about sales that but the think the organization, OpEx color add to how through some year. we curious on more remainder of in and should the

Teresa Luong

piece. question. for Thanks I'll clarification around Yes, Rajat. in that some provide that

we some regards in headcount, in the QX. So did benefit to receive

savings, So expect some that in million close leads in we benefit. QX, expect full do extent to to regards we but the do QX, regards us the and $XX annualized not benefits and some to

quarter-over-quarter, about as So we're the headcount, think we cost there's marketing, that be other effectiveness our we and when structure and efficiency marketing, of fairly monitoring you marketing flat, expenses. to said, those spend. continuously but And expect

that were based So as the and we're we able trends pieces, real we're to seeing, to there needed on do time and expect that other adjust in stay flat.

that QX benefit the So QX total, reduction. from the workforce from we and expect some I overall, savings in say in would

Operator

Our B next of come question will from Naved Riley Khan Securities.

Naved Khan

was if I'm nice more the macro. curious a Great. unit. Thank And just It's to sequential growth mostly favorable driven by increase see the in you.

much the in how So of more versus improvement? improvement Or general? by TrueCar a general Plus really this of driven is

Jantoon Reigersman

very so Yes, good question. a

actually, it's, two think things, So it's but it's I TrueCar plus.

still numbers. is yes, material Plus date the compared bigger in to TrueCar So to

driver. big that's not so the And

conversions the continuously et focus However, platform, rates, improve we the on site, cetera. on close

the it's the doing itself. so that as combination resetting site conversion they a are type macro on And of improvements well a terms of rates the as provide, the obviously continued teams leads, in of

the are cohorts, there And into So Plus two good for a going now we're to go having drivers narrow much there. is more obviously that. with field TrueCar traction,

And really forward. on number transaction But out so of right now obviously, plus in going is we're side, accordingly forward. effectively as well And going to that's TrueCar units the report immaterial. there focused going the

Naved Khan

it talked out do then track? yearend? you still view Is kind it. nationwide. on previously you Got How had by that And that rolling of about

Jantoon Reigersman

a Naved, Yes. question. it's good very

into the So doing to product. expectation product you was very the way about very of Plus, obviously if much their we've the different own experience, a And TrueCar flow. really engagement and person we're effectively a learned because a it has a person date ones different very never good lessons, with every finding that's new think is buying

realized is more had you and we out personalize as to flows that examples. we much constraints those what appear, give take so go And along. I'll

because then to will a rates, also lending the but lower And obviously, will big become become you lend lender because dealer, lenders, the of only If on lending the credit they issue big for for actually that affect the it right the profile, lot. depending dealers not a find might the then margins issue. are a consumer, need type the of against right can

Remember product have It's do lot or to cohorts. flow. end nationwide, restrictions by a much is that each friction And And with cohorts with new the And on to others you of we to are personalized either why a more with there which by three that of the personalized solving nationwide more realize without can points more the to if obviously we're need or having any be of is ability used a quicker. states. journey, very at the day, because landed will immediately that therefore issue. time, more flow. the the also unique the over inside we there much we nationwide them be obviously, cohorts be certain realize look we'll detail, have in you the so start harder you But that at idea are OEMs

seeking type states, to nationwide in sooner. that, outset. And economic that as almost type form on with And pretty actually the on and result, cohorts so cohorts certain of launching financing given the from as of a us requirements, of to the and example, be and much the the we'll pretty but faster the two but cohort, an cars be facilitate obviously, will depending much anticipate to nationwide cohorts depends nationwide, the we're do

bit We'll the the end So on seek to depends is little on depends and answer but the yes. be the cohort, is of net-net it type nationwide a type of the it product of year. by

Naved Khan

on then question went reflection that? is versus think the monetization, new mix how last should I a about sequentially, between that the And the it. it just of down Got used,

Teresa Luong

in down correct. at mix, think last look about it XX% that's new think or was I Yes, were, if mean, you XX%. and I I the closer quarters dropped I our think used XX% to few mix to used

there. So factor in that a did that definitely have mix

Operator

White from Our next question with will DA Tom Davidson. come

Tom White

Great. question. my for taking Thanks

it's guys probably the just been being mix segmenting to talk Just car and or is guess And flat requiring your you're of a the commentary for of you kind differences buyers kinds way different cohorts? buyer change just about to audience in or sales you're of marketing with channels. viewing acquire Any or in around about of this. kind or traffic I different three kind quarters your of I little thinking changes now you whether marketing this you use or bit be spend guys guess would Can go one the I'm a me. couple that along marketing audience talking acquire kind sequentially. these are about ways Thanks. you

Jantoon Reigersman

Yes, Tom, good absolutely, very the yes. is answer then question,

arrive cohort It the a they're going So the side, to allowing on retarget dealers either points a is one a on the to as allows in the the different. people journey, have by they cohort beauties though not even obviously we're is or froth three at they paths. can for you be each opportunity within certain different. dealer more and take But are site, entry cohorts. three we of just different that to marketing focus the a targeted that value don't proposition only serve way, start find people obviously, is more Remember, absolutely the the the for cohorts. that misunderstand the places is multiple cohorts given answer that many the value for certain those have us. create slightly as as three also the us cohorts But real I company, which approach. think consumer it so cohort and effectively, The could yes, of also, value proposition slightly of Even capture obviously doing

a the markets. that are to And within seeking date, engagements, Remember, the one transactions part economic Plus cohort TC large this is already. is in of if actually people cohort you that very Plus look unserved TC significant at are

with line about the lenders. have so And actually flow was and then different we butter us cohort, better up the bit the that's whether historical way, triggers, think one allows set right to bread of you the product current little it and TrueCar, more of affinity then in the the a but convenience really even of also focus if the much partners

does of on as actually it's with each you and so only we well So marketing, true, as affinity in partner start cohorts something the embarking the it's absolutely segmenting now so facilitate that is also effectively specialized lenders on. everything, of which we're But the targeting the not are different targeting that side, cohorts. facilitates more these have

is but allocation and answer expected in the that, it's dollars of side, the on. working se, that's yes, the now So about marketing dollars overarching not we're per of which to being increase more on smart much terms

Operator

Instructions] [Operator

Our Pierce will next Chris with here come from Needham.

Chris Pierce

macro. like the recovery. Hey, it had where there's growth at fleet of kind to, is agree that really Do you is with kind guys sort And just good that the the kind you new I to then up, a seems question of right of some morning. we levered think seen from business of follow that? a the that of looking haven't more shortage, to a on it? car are come And way think yet? would about recovery -- Is you consumer of kind further driving

Jantoon Reigersman

I Yes, absolutely, is the think yes. answer Chris,

of So obviously high the though driver. even time, and that coming are like in even an lot the fairly prices lot you're see high, looking also of remember that But that over of And used demand that cars platforms for you held was markets. think fleet obviously I in I important prices in can is are still down. people you see is can right there's new fairly still that world the where There think the very different steady. a all demand cars. And the from demand. holding agree UVs cars a a across because Even pent-up are

now mix so think And has I is that a in inventory come started the back. yes, the think answer days I there's has that increasing. healthy also

I a we good thing for sporadic. is us, for macro which is more all-in-all, a bit think into And partners, which favor, It turning little our much the And for so obviously. is always our very dealer be and helpful more a good is also thing still can us.

bit to depends of cetera. this iron makes course next still it But a several over the we quarters. the and on et the So little out expect brands the

Chris Pierce

in Okay, prices kind it still what's kind a with you guys changes to just are quarter relying guys back it possible needs me dealer it looks driving Is high, a --? more? they're XXXX. franchise franchise dealers TrueCar account Is Can you looks have added because dealers? of of what's like it is sense or on of the you kind to get franchised resonating have like those might just because because walk through dealers bottomed of it made? Plus of the Is of

Jantoon Reigersman

combination a of it's a question. Yes, great all. It's

that's sales have of lost help. called previously we dealers So coming more I of element actually hey, an can it's they think walk obviously, had need you were there's to than So certain actually do area. you dealership something back, and the you ABC, can if greater have beneficial show also having they their ways into are in right? And markets much have like, actually own Obviously, you. now you inventory a lost as in that show more and a sales, to

and It's available. new now on the And we interesting example, to launching, data for new so an starting cars. We're sponsored and product I'll driven markets you are the the because for also data turning all have proving we're obviously listing, example. opportunities. all very for give it's offering because flows

used to that have for So only we cars. use

shape, to thing because for especially then that's segmenting obviously are dealers other just the cohorts, there also, some you specialization the also dealers, form. as well into to opportunities of the start overarching some And form resonating so is for play dealers. there really opportunity And have many or in

and they segmenting actually best. really what so do to And them cohorts allows do

And so of type for us having is important. that traction

is to were those that is salesforces think revenue shifted that rooftop to or net effectively that on often important really metric our count, focusing has type driven of The generation. also other I underline by thing historically, all

you happening on the and see historical is franchise generating valuable some core very or it's that dealers larger often obviously you'll, the MR are players, a we're natural independent really so often little dealers, a low off coming very of as that focusing normal firm revenue more bit shift bread small, And and and the independents butter which of and well.

But So there's a good. are yes, these so us. that proposition for to is shifts natural happen value normal,

well also as also for and more that highlight in to have proposition value both thing one we've we've dealers. tune segmenting cohorts, we're focusing think much we started the with now on as gotten I consumers the that

is we'll that of over conducting what we the we're differentiation where continue that and so better have much articulate have biggest And the are in strengths next on an we months refining this past. that than effort couple really the

even assess look actually overarching, hard you if for think actually different. I what the different the financial companies makes right, community, it's to

this it's conducting a where market. what so TrueCar we're we now right on actually other also articulation are much many the much our articulating in players And forward effort with clearer so of and come makes different will much cleaner better. the concerted from And

Operator

[Operator Instructions]

BTIG. come question next Fong here will Martin Our from with

Martin Fong

break improvements And any morning. you attributing good units conversion changes behavior? that noticing if up. a One were for are was my up, bit although Or down quarter-over-quarter, have on then in Thanks the website? down traffic little questions. you that question a just more. rates, on taking wondering I could Hi, to maybe Are consumer follow you

Jantoon Reigersman

it's I both. Yes, I think, Marvin, think

the like, what part a where we're and and always a also the thanks of That's continuously people we're we're on car smarter tick product driven draw also don't And also, on forget number one. by side. TC of to that happens conversion And and improvements. up making the getting lot car So learning availability. people effectively. But large end is day, at it's makes what prices Plus,

couple in the the the into are quarters lack look you pricing big a of of in availability ago, like were the eyes they when conversions of two or consumer. if was low, available, So cars when the drivers the were of of the relatively obviously, disproportionate

that more, themselves. for now the so consumers they're a and almost And becomes possibility

over But become we we that's on a then And continuous that, to these that's big driver. think cohorts. the time going to obviously only we're improvements right I addition the itself. on site improve obviously as that making think more focused in

Martin Fong

And understand revenue, of we were is, net value. stabilizing? a Should you a saying count, lower about be or you it. I but do everything going to your just question my are what's up about Thanks. because off continue the Got be on that like ago Dealers think you as talk focus follow lot the turning dealer to that expect there? visibility might independent decline to you

Jantoon Reigersman

or Yes, like gone often those are turning or are, merging that there business out are so ones the of are smaller often players.

obviously will adapt not. will time the interest prices used how some to the the But that or that some or like smaller to we normalize like of that think still player depending is little high, And And they lines, car through there are side, some are, rates needs longtail able little business markets the still say being, just number are given question whether are rooftop independent the quite where for kind they the are them a to making will have probably to are time, for I I and their make system. effectively there given stay wash hard the relatively on those a struggle. that. that while how happen able of and on be they bit on anticipate it's to the this counts, so left.

some level then going a I anticipate So bit will and to keep for us little out. point would that at

Operator

And President TrueCar’s the like session. turn Jantoon for back and the this to CEO, call Reigersman closing concludes question-and-answer remarks. I'd over to any

Jantoon Reigersman

also entire team. to to today. to like TrueCar thank I thank the wanted taking on call our the would time participate I everybody for

team. team hard. work the a smaller nimble working continues So a It's together. is team the And coming well super It's team. tremendously to

our the you our And to on calls. for So look company. exciting it's forward continued Thank of of we progress more all about time with couple next an you. sharing

Operator

The Thank presentation. attending concluded. conference now has very today's you much for

may disconnect your You now lines.

TrueCar (TRUE) 1 Aug 232023 Q2 Earnings call transcript