TRUE - Earnings call 4 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and welcome to the TrueCar Fourth Quarter 2023 Results Financial Call. Please note, this event is being recorded. 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 Fourth Conference Hello,

read which me our close website all ir.truecar.com. you to Foley, is and had stockholder Financial opportunity Joining our Oliver at hope is Chief available today Investor after released was yesterday Officer. on I the our market letter, Relations have

differ to this are us forward-looking statements, forward-looking on by statements plan, forward-looking will expect, intend, materially. safe we required the statements law. XX-K, a such filings review be call We from this to by remind our disclaim Securities want we and started, to get the reports Risk and Exchange to annual relied I expressions become, on by identified results performance with date, target, not I make guarantees of as reports to those are Before information contemplated on be available as statements as Actual anticipate, our that can could and that today's need be materially any we update the harbor. future The call. words based of forward-looking seek, to These of confident factors and we read and of results caution other XX-Q differ obligation our statements. of for making Commission, on should forward-looking or quarterly our you Form and you any use our on our section will, not Form discussion the except and Factors results. cause report on as similar could believe,

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

that, provide a summary of brief the I'll quarter. With

QX, achieved XX% dealer to was $X.X XXX franchise independent by dealers, We by continue addition driven is quarter-over-quarter in QX. independent year-over-year. active XXX in the by deliver challenged TrueCar end continue with achieved and of growth while them potential million, as of help end increasingly high be total car viewpoint the EBITDA consistent environment, net need growing which of Meanwhile, with of at of million XX,XXX we signs revenue loss interest adjusted year-over-year our in cope $XX.X rate to count, bottoming improvement are franchise a services net flat to active dealers new QX, the dealers offset we that In saw today's our dealers, versus with the inventories. of encouraging This for a dealers promised. in QX profitability XX,XXX at particular,

suite Coinciding combined known Solutions, Further NADA, of with of in-market vehicle to new dealer by partners by dealers called highlighting many the of informed to the QX targeted unique of related of XXX-plus the TCMS. sales. which common response one, targeted around, this feedback compromised and capitalize sold units our consumers. from Marketing The growing launched our incentives is XX% units units in OEM our positions on to to in from and launch XX% and also up and to total reaching challenges their product of Association at -- our we vehicle our also TrueCar most shared XXXX, QX, total sales TrueCar in sold total on with XX% up identifying was trend, TCMS audiences in of Dealers new sold Automobile on audiences as franchise TrueCar's partner called leverage National presence to believe development QX ability We dealer us towards new focus XXXX. offer a affinity

know from sea consumer the surfaced block revenue past. as the loyalty and budgets. serve the per will competing attract lacking to our environment helping And traditional significant products digital of us, TCMS out three, channels to not partners promote brand objectives Therefore, while the in standing new showcase our a dealers the being key and of building result dealer. capture cost-effective the growing of the we're is inventory offering growth Two, search for cost-effective algorithms. dealers' The a near-term ways for come marketing presently only a accretive a to and adoption dealers lead-gen us highly is and but confident also marketing of listings alternative complementary represent a that common key core share new retain which by have dealer more digital by that that to business not rollout

through of briefly what launch a Let way we in The of digital buy no TCMS ability to entirely preowned to us TrueCar+. or without also new with used turn transaction. comfort pursuit retail. deviation the holy our your be the automotive believe to clear, online of on and be To in the grail is our singular remains of couch focus an from a a or scar certified trade-in strategy,

they deal a deal means number millions seven, a between their of products comfort find taxes, Two, schedule fees offered receive installment or pickup a consumers, from to build aftermarket Four, for that lenders that And contract. their is by fully of on Six, deal. a nationwide all financing the retail upon and regardless score. secure Three, credit vehicle trade-in of For range right them. transparent couch. transparency the their select directly of delivery and the value rebates. the of we've built digitally one, receive the execute the all competitive experience, and firm offers offer includes always range into where listings Five, dealer. trust can, an offered incorporated the show that from a out of of

We nationwide. of expansion compete one, Two, customizable F&I their attachment an dealers' to significant the to Three, menu. experience access superior a and completed like. addressable fulfillment. the a risk-free And For is rates sales across are looks buying offer, efficiency market consumers volume four, dealers, ability a a to improvement who by and we want for believe online trade-in. transaction what in this true for delivering ready

the external is online this will hopeful We a the we're purchase TrueCar are work. make partnering of to first new not and of enable half key year, true that happen. car this with within several first trivial This stakeholders

our product will And be clear And for current that cars as road we transactable development with a fully product will coordination to significant transaction. to super a online of the the at that we takes, date today. TC+ of learning map, complete platform product TC+. online though to Once only point, and been experiences completed, replaced effort get lead vital this even have level the us the out TC+ still has know we control. are classified be effectively some including and development have

Lastly, and our beyond. outlook this for quarter

As two, cash of XXXX. focusing by a limit number per reminder, OEM our margin at our to following grow our this expanded achieve number XXXX, activate on offering; blocks: million business end dealers; flow by goal dealer XX% $XXX revenue new one, revenue is We four, goal partnerships. average three, we annual X continue product through grow of XX% the and dealer building churn. to free to from Number implying to the in with rate growth can XXXX believe compound return a the

and will revenue of breakeven against have but Progress adjusted effect around growth growth each over for year. QX these course take compound aim the time in building We -- a blocks the should year-over-year EBITDA. of XX%

lower As to a year expenses. due our seasonally adjusted payroll-related the typically and NADA reminder, quarter flow-through first is of EBITDA

of in of beyond we year. Looking the we second half free EBITDA revenue the anticipate QX, are flow our that growth an confident and positive cash achieve can acceleration and

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

Operator

Instructions] Naved [Operator question today's B. Securities. Riley first comes with And Khan from

Ryan Pfingst

may. Two, behalf on Ryan Naved. is of This I if

you growth Can that? revenue in incorporate has in to you trend incentive grown look in expect do pretty opportunity packages. then Marketing about the Solutions the letter, subscription to talk the the TrueCar to time for second, line alluded How materially. shareholder you And XXXX? First,

Jantoon Reigersman

Absolutely.

is -- so think So I Jantoon. we this

$XXX the terms are end In of very the revenue return we by to of outlined, revenue set to we XXXX. million growth, obviously the as focused target

annual compound growth roughly of a that's So XX%. rate

X we single-digit Obviously, growth. is confident years. compound growth QX to building we're that up the now growth never we've of required in effectively get we the double-digit over growth. the had to had up QX, blocks we're rates seeking right, is remember, the course next building perfectly are So linear, this that to and

over time need growing So and just we're remember, out building that the I again we accelerating we of trough of we'll were the blocks. up QX, course But we that the be the this have know building and we to do, what of think also coming actually year. in first and

TCMS. Vis-a-vis

of which weeks have was at launched this we ago. couple So NADA, a

would And real are some I QX launched, currently being be products argue but of of these forward. that the and finalized, are course over the impact seen going others should being

be marginal should QX, over in you will roll year QX increase revenue see be dealer flow more course there in you'll the already out this some Although as these an and of some sign up for dealers products ability will to effectively revenue where in but widely. seeing per

Oliver Foley

I'll second chime that Thanks, in just Ryan, on Oliver. on this is that, question.

that candidates very bundles. some right, more look to I programmatic on see marketing of of there Others of spend sort description products, each that running really at more provided into are good the campaigns you go the their the subscription existing of to dealer's channels. on be are, bespoke and our behalf, incorporated TCMS we capture some effectively really we're of that If to you'll are targeted trying digital traditional sort and where would think, them

will hope branding The reflect the awareness our additional for and so provide beginning of to traffic that them. TCMS additional products. is -- really ones incremental been of are QX, by these on-site very driver dealers, of And designed subscription that our an some sort for more programmatic sort of opportunities tiers

Operator

comes question next from the Davidson. White with And Tom D.A.

Wyatt Swanson

what monetization you around in there little And TrueCar+ think if assumptions on This year? a Tom. more your revenues Could it TrueCar's are could impact benefit way? TrueCar+ explicit from Is Wyatt about when for XXXX? talk you this outlook is a do not, for bit meaningful an

Jantoon Reigersman

Yes. Good asked and think repeat I'll the question past, too. said similar question. then was a we I in And that what it's

mentioned. is I think blocks we that building the for the really focus XXXX, X around

perspective you you learnings roll more fully that that as that more from put increase that opportunity. you'll we're dealers the but significant getting back a that commercialize platform, and out, also us is TrueCar+ We're the that really high focus be expanding as dealer well throughout are on limit to there the onto dealers not product always and on that product offering aware and program. churn and focus development per for going as contribution it's of Obviously, a some we revenue So by XXXX. assuming of do expand OEM

beyond. So kick for would real year, that should contributions into no and limited assume in, obviously, there's or XXXX that this financial and --

Wyatt Swanson

Got it. And...

Oliver Foley

outlined I'll attract we by helping digital retain ability the do just of online dealers props a reason sort expanding those dealer, And I'll have Wyatt, will their and in new And #X sort the existing for because very their it addressable provides be that of transact that XXXX differentiated value sales. monetized we is dealers. F&I I -- key view, I in in entirely those TrueCar+ it's way it's that my value marketplace chime some proposition do is car The believe drive unique say to very first once quickly and a say improving that dealers. to market, us new whether that purchase, we that of

our dealers execute And this others can we year. and that do there, do us our that and retain hopefully, marketplace once hopefully think we differentiated of that, the so of will half of that's all sort regain the in truly we help first dealers. have I from existing a out prove share

Wyatt Swanson

capital Okay. on you then Great. allocation Could for us And X priorities update just follow-up. your XXXX?

Oliver Foley

half engaged in in $XXX our flow in of sort of balance are second think get strategy. cash will long to be over be half breakeven, keen that with we year. year, free of once Yes. sheet. we've of come a I'll million expect we And deliberate the given to said up cash maintain on we free that still capital this quickly flow strategy there. the the second allocation positive very this I mean now, we actively do Right sort I to jump we for

table All So marketing table, as year. budget. TC+ acquisitions, the everything it before, on is whether of repurchases. It said the this robust more be be it strategic are we've on with a the those for things be share growth the half supercharging of second

Operator

Pierce And the next question comes from Needham. Chris with

Christopher Pierce

a can that can there revenues. speak is you 'XX. your OEM a about line I revenue of pipeline get to specifically, just Is how talk there seasonality any there? incentive that, Or about think into want sense revenues, there? On you to to

Jantoon Reigersman

Yes, I don't there's It's -- to Chris, are more these seasonality it's a project more more -- based -- bit much are lumpy a think se. and so as any effectively little nature. per a in more result,

less programs that are project, so It's consistent different different more about revenue. it's with OEMs. And effectively your running like the

We are We're in depending are on often the multitude OEMs, some than different point little of suggesting any relevant have in a a time of programs There conversations at and others. at programs. points forms different the of more bit time. priorities

always revenue the exactly it's of, like line future And little a bit bit how so that hard it's growing well predict very and is okay, a fluctuating. quarter-to-quarter component little to

opportunity in general. see side we overarching, OEM But the a in huge

And it back we've trajectory yearly dialogues. we you there's that a outer should obviously, for that a so example, we short line. version feel we if that revenue as beyond opportunity -- we obviously we OEM look a active large large there's get numbers of start us looking yes, like And on to and is, obviously historical grow that as do outlined, the the -- to feel we the basis, part at in longer-term But have years. that for

forecast to that. but interesting predict outline different for or or very programs pursue it's are have that hard the We that that to OEMs, perfectly

Oliver Foley

just to these based I that tied the meaning And still on the because purchases. think So very a of Chris, is that volume pay-for-performance it rebates, the business really new OEM vehicle in seasonality sales, just right? type they're new add much model, I'll car is

it when speaking, of And seems generally come you to higher in you always QX, new because seasonally see car down see slightly. kind that's so QX, generally have volume sales.

of the And It's so behind vehicle seasonality I side to the OEM really would say just the that's really new sort tied of sales. business.

Christopher Pierce

the and need Okay. talking the it. dramatically I just last and that TrueCar+ the quarters. forward to good learnings expenses, because further you're development does expenses? Perfect. there? it's down to of then And Or to on out think investments rate building way be for couple going in from this a tech about about run want know right Is pretty there

Oliver Foley

Yes.

were out $X QX, accrual when over of call look million say of one you to I'd So at reversals. sort thing is there that just

we had the of in benefit a certain accruals So sort onetime QX quarter. around headcount in that were reversed

QX the So dev say in would below should rate slightly I the and what run expense tech be. is

something above that of rate would believe, at QX. I million the expect, think $X I run is came closer, in whereas million in, sort maybe slightly we I $X.X

had definitely that nonrecurring sort we reflect QX. So does that the benefit of that in

Operator

comes from BTIG. next Fong question the And Marvin with

Marvin Fong

on as on that the you how There independent the or question, can a super you plans little thinking for bit for asked, dealer to simultaneously first could white a your of bit the process dealer and even quarter that throughout that Or I OEM? Maybe thought days, out? this And on a out your behind websites expand So continue marketplace? hopped you little could quarter, to Do view apologize, it kind seasonally that? keep TC+, do solution of just higher, plan know roll churn channel. or then label speak you I in think there. dealer sort typically a churn roll expectations little early do more but and the but your your expect is just what's I I it's the was an was to to fourth understand independent already on you in I but fourth late, if uptick just XXXX

Jantoon Reigersman

independents on are financing, so obviously, and, financing time almost obviously, within costs oversimplify Marvin, if Absolutely. groups yes, the high smaller of that. many think mean it rough the a that right, independents, think therefore, But have I with as you for affordability obviously independents, consumers. you about through there many, -- limited it, going as --

as them, so inventory inventory. acquire hard it's well And as sell to for

lot going roll of are up a them being et ups, cetera. effectively rolled so of business. into acquired and They're either And out

the obviously We're lot see larger space. there, a a and moving of very different independent traction independents, still on obviously there's but smaller run on very So the we and good focused shifting they business.

franchisees. So of yes, we year. a see decline continued throughout But larger good smaller traction good the obviously, with a independents with and independents traction

that -- questions a before the -- that's on I that's over So go any I on think TC+? specifically

Marvin Fong

No, I like that great was answer. it. got a

Jantoon Reigersman

think going the I question. is I yes, do future. right we look, dealers we're your think on TC+ about you TC+, One every have to It's different -- have how then, the obviously, partner number on really TC+, I to On and is Okay. parts really there X on -- X not sure in single focus making the about we're dealer are think rollout, think supply/demand.

there for so to available. on that going can a and to we're inventory sure be to is where dealers happen the experience obviously, around is find inventory dealer sure experience consumer being that right make prequalification and able making we and about we're going really to very the because, both that that's consumers the good a is thoughtful right be And really want that,

by making consistent that sure doing and manner. the the so And and at that day, very it's right dealers that end identifying in then the on about they're right also of really the scaling a then

there. thousands thinking to dealers amount of also flip a you're inventory initially the of switch having So really about have from then you're tens on of right larger going start not and it's something on, that pushing and dealers

as an transaction the are interesting online thinking you stage there us, think about space think you our point question in if and start about as you white that and things labeling, for right? very of, consumer already So absolutely every opportunities that people for capture the affinity on at think interesting inventory if things network then committed very very us own particular, to wants has, almost on and different you example, a lender a all to able opportunities earlier your and Vis-a-vis the who entry effectively they you're are then TrueCar+ consumer wants are about you to should those their through hey, and very then example. find already and for should car lending those to you a like through be your where specific have who possible, prequalified be navigate type their of with you, be side, experience, them see lend an

the on forward. So focused broke in a envisioned that we've always there's yes, near we order vis-a-vis lot camel answer is that. are, us the getting and opportunity opportunities the the it. of big the We the going happen finally marketplace to opportunities actually are enabled very the in for transaction term, way And make But white this paperwork. back labeling like to obviously of

Operator

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

Jantoon Reigersman

Awesome.

like to time for their So the participate I continued today. perseverance. all in and also thank taking call our team I to entire the would TrueCar for everybody thank to at dedication want

opportunity doing We the ahead of tremendous and us, team have is a huge work.

and proud really want contributions I'm all them the for them to making. of they're thank So

Operator

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

now disconnect. may You

TrueCar (TRUE) 21 Feb 242023 Q4 Earnings call transcript