CDK - Earnings call transcript Q1 2022

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Operator

Thank you for standing by, and welcome to the Q1 2022 CDK Global, Inc. Earnings Conference Call. [Operator Instructions].

As a reminder, today's conference call is being recorded. I would now like to turn the conference to your host, Mr. of President Vice Diego, Investor Relations. Reuben ahead, go sir. Please

Unidentified Company Representative

like Thank 'XX to you good earnings I'd you, afternoon. to our welcome and call. first quarter fiscal

Chief and Joining Officer, on today's are Brian me call Joe CFO, our Krzanich; Tautges; Eric Guerin. CEO, Operating

taking we'll prepared be their questions. Following remarks,

is press investor.cdkglobal.com, and where is simultaneously on earnings this market issued release the Relations webcast. was call close Our our the Investor of after today posted at website being

which in call statements. that further These forward-looking call to our made specified. and everyone this to With results which this remarks would Brian. copy that could adjusted forward-looking supplemental for our contain that, like most directly include adjusted our growth to also website unless our updated amounts discontinued presented I period, that filings the financial note during which call, today's my as includes Please that otherwise basis. risks year-over-year cause discussing over amounts are to information as only, change will results of of detailed amounts the refer continuing be our to GAAP not with to the results, during it's operations. percentages uncertainties we our a on a addition, statements Reconciliations remind press involve financial to actual mentioned international those differ call may presentation In the prepared during Excel and our statements. we of non-GAAP are in an included the the turn release. referencing will do are operations schedule noted, Throughout business afternoon's in be comparable Unless SEC, all materially pleasure otherwise from references remarks.

Brian Krzanich

of to our and with thanks despite in in and environment EBITDA to strong the start growth minutes. met million off Joe business, $X.XX inventory color per I'm XXXX a expectations to which the pleased driven will and in Reuben, and is share, financial of and of you, a with on everyone few customer X%, slowdown a revenue $XXX Eric EPS more today. transactions these results, market. fiscal shortages by joining CDK give call for Thank auto performance modest the the

those and Scores XX growth. and investments, our underlying with the improvement business. XXXX up And Promoter points metrics DMS in improvement core straight site these in OEMs notable dealers recent our has now that drive Last of wins. automotive industry. with event to the the technology customer-focused CDK a retail hosted an And opportunity highlighted we end-to-end given that Our business ongoing to This ourselves process can market-leading seeing excel than a few business, has with in become our to focused software we're ability customer ago. and We've XXXX industry. and on it core into connecting demonstrates the of making been strengthen different And that automotive a steadily We've the CDK just industry digital, creating company strategic market. to the investments transforming anyone more XX since is Net growth in fundamentally we're the including core Connect, results for with technology. been years financial a benefits our improvements significant service us modern-retailing bring industry else visible the partner strong collaborate to transformation the quarters month, of rivals was that in

vehicles, quarter applications leverage and like and are CDK to this quarters or bringing technology And process result we ecosystem but stopping exciting we and for opportunity a the then continue in our share to At platform their made dealers, deliver systems, the we've the we've than or introduce Elead especially a is add to We But to continue I developers highlight expect capabilities possible a for variety our XX And I who to efficiency service that isn't more in this dealership, CRM. consumers and together dealership. experience. delivering predictive architecture, core in to from our to into much including around come. alone. Exciting purchasing there. Fortellis more satisfaction Without while announce consumer OnePay our complete. omnichannel innovate by are the whether CDK functions. problems customers. Fortellis, all generated not applications including platforms. the to Xx XXX pace will bring Joe of new growth and on And of completed mentioned, a drives and OEMs advancements million that they enabling to than and we're we've to software more Roadster improved key the into solving pleased to Xx an start allow service event, modern innovation vendors integrate latest platform. acquisition to And this within the high demonstrated We pleased accelerates go at end-to-end in are in the that back plan We're real the workflows, Salty would new in the in to new accomplished as the frictionless interconnection we advancements also the detail, room XXX-day the have on quarter. office together of We to now Roadster their our to built, to and longer taken the legacy CDK. from It's the have want independent applications workflow and API more Fortellis leveraging The dealers technical research transactions software customers at industry innovation have to digital that platform. complete visit transaction our integration at capabilities seamless from the living live want truly investments providing home

acquisition our begins space into vision This the Our to for buying create all insurance experience with is entrance an with car and Salty. integrated of owning. aspects of

billion every existing used and vehicles insurance. year, and new the offerings of those TAM team for dealers and approximately dealers CDK innovated $X Salty CDK. The needs entirely millions an dealer's excited to and a Salty's technology Our insurance one opportunity, welcome opening each the integrate data vehicles process, And to leverages to into I'm of family. by and of dealers pleased are deliver both new

While data we're excited systems continue to amount for OEM. positioned body, dealer between daily. a and bridge the dealers the we through to about our CDK massive CDK work well of passes A is serve believe as

improve ecosystem. to quality position of OEMs allows it to across these branded as industry, working applications. front. of the intersection and customers white of OEMs Our performance service. initiatives of with to this our data on real-time broader both the access enormously solutions last the reporting. CDK provides that vehicle power an valuable group and and we suited to ramp-up ability uniquely provide inventory to develop CDK's we're solutions using a of label In benefit on through to dealers important securely number is to insights help safely help is worked of unlock And Neuron quarter, us data this the flow select and critically a

Fortellis. OEMs, our vehicle us to business dealers To this that their service sharing and locations, in these the uniquely sell major data pivoted dramatically share of ecosystem continue data a improving connections software employees, data; to we via We're new and And through and enhancing our help can recent signed automotive connect collaboration OEM, we business help and experience. has everyone. the connected expertise and technology, summarize, grow data them of at positioned build developers our facilitate and benefit for OEMs also its dealer of to the access more through with to CDK heart one And years. will products dealership come a to vehicles. industry. while consumer offer number with efficiency agreement unite And We improved

employees, Now to Joe, before year such the growth customers positioning pleased helping our over like with business a for start. fiscal pass partners for of in our get core to accelerating and remainder I'd XXXX. our to and We're our our off I the the things great thank

Joe the to highlights. now And it business so for turn I'll over

Joseph Tautges

and the Thanks, call. welcome, everyone, Brian, to

As were the the CDK's set began that versus in have XXXX completion September. Brian we the excited with are we adoption the had uptick said, about in Roadster customer We for following plan for technical the integration strong outlook start of of and platform year. pleased the we the into

financial go minutes. the as with the metrics industry. I'll we and included underlying metrics is technology focus for Our show into some a that customers. first, results a charts on in and are have underlying automotive the seeing in quarters, few we service few data But for we've several last our our customer of working

dealerships support well, for auto to are positioned market of vision. industry lows. also buying in this have Overall, how creation provided experience few digital holding that we but the are We cover record a built trends, a reasonably up at lead the is platform architecture unified slides we inventories the of and

Our conditions and a data per sales in reflects dealership. modest credit these transactions reduction with

mentioned, and of trend remainder challenges, driven throughout the believe has the continue B.K. headwinds inventory year. associated we our As these in transactions by saw the business could fiscal

monitor continue will closely. to We this space

been experience automotive where rapidly an a On of models. the smooth Dealers other beneficiary consolidation happening seeking consumer quarter flip side, months. to them vision. has response can scale in to announced customers continued will buying that this enable environment resilient. allows they are solution to the states. prices, consolidation, experience we a option continue have to that digital with very some been realized investments we are from last We dealer increased Dealership type digital several reach of customers retail recent this in profits necessary expect that deals the economy net so all of sales with retail large CDK make this only end-to-end available coming enable have has an lower believe changing in this is of quarters XX found we in which the a believe for challenges to as inventories consolidation

grew some auto wins X.X% wins fell include dealers Roadster were Revenue universal site per site gaining higher our stakeholders. sites site site to and Service, is combination points of and contributed grew Elead to non-CDK X to retail team business attributable we reached all site up to particular Roadster We than our Cloud since had while the with our while traction Now continued DMS X%. consolidation, to every with Service. Earlier, in with the of strength up X% layout and competitive notable growth another the ecosystem, growing XX quarter for the wins had driving site Roadster where product retention in locations Brian adjacencies. adoption with now by key digits, of Auto strong, and growth X in Adjacencies record per touch automotive We competitive points Cloud for efforts X have dealers auto grew the our resulted the of wins level customers were mentioned Elead, event work sales last in share in part I'll sites quarter. month, CDK per revenue discussed sales from Connect. partners. groups with healthy revenue revenue we X-plus adjacency QX. XXXX, Highlights slightly. and highest levels with and last winning We for sites. was to Revenue new X turn continued vision Connect and site Auto have high. quarter. strong double per And acquisition. initiatives growth CDK notable with that highlights Revenue Roadster, we both and penetration. XX-plus all-time X%, both The CDK and able sites hit benefited applications and from of in from to more site across that Doc strategic X X was application our

capturing is This engagement that for now to used event, sales the total the Our across dealerships. wide and in software sharing used allow this selling consumers. At process. buying than variety Roadster some in optimize a is a also tremendous XX,XXX integrations digitization meets This that the more we asset. highlighted data of fashion level efficiency flexible the across dealership improves needs of tools a the of of by variety of process. the experience It modern, a the provides

our hour. We X to will workflow, Elead merged teams, Roadster below will times purchasing allow enable transaction have to build continuous engineering which our a which also customers target us

vehicles' opportunities revenue simplify productivity. sales process. Neuron Our customers to and the improvements significant increased cost also are dealership analyze service workflows. highlighted needs. target improved service technicians this platform, of the service, specific efficiently the seamless functions can Predictive can leveraging solution the efficiency for opportunities enhance accounting workflow revenue by And their Connect drive potential and using tools helping that data new by in the within excited back-office our and CDK power new

By coming for make will We shows of opens to the a acquisition in pools. our how a changing rollout navigate that Salty the marketplace helping will for for profit the the And can help of is process dealers ripe continue for altogether, and disruptor we're opportunity CDK and consumers customers. most and new new and new more quarters capabilities our new a the build and lifetime dealers, difference dealers rethinking CDK is become value. deepening obvious disruption, of through consumer dealers accomplish Insurance is that one journey relationship we the buying parts the increasing significantly the car change. customer helping

combines An total revenue the for and strong have to a and panel opportunities new to insurance process financial ultimately I'll strengthened new and core allowed in To quote data, to of and Salty dealers. for As will maximizes turn to Brian customers the time, both now more dealers add XXXX. the value CDK. at results. a technology the will over Commissions and addressable chance business dealers partners quote over I'm seamlessly to insurance. buy insurance streamline integrated are proud conclude, vehicle process. pivot Investments for originations renewals and a process market and into mentioned, large that and service accept the while that it made CDK and recurring we've insurance and of we the Eric integration sales technology stream both OEMs. positioned over strong process CDK our us Salty opens fits for the my how progress years on

Eric Guerin

good and Joe, afternoon, Thanks, everyone.

year. As XXXX mentioned, for Brian had on and nice that start puts the Joe we us in track a

operations our XXXX. outlook quarter as results for me presented Let do remainder are results the you is to through for the business, walking start first International like continuing discussing operations. by that which and before not the include everyone I'd of remind discontinued only

up $XX standards. disruptions. was up accounting, last reflects subscription by million, partially sales of certain vehicle revenues the XXX impacted revenue which revenue timing XXXX, excluding X% XX%, million, ASC and revenue. $XXX Transaction Core $XXX the million supply growth, and from was the acquisitions. lease year. impact from revenue of down driven shifts by revenue ASC of the XXX a X%. revenue X% up portion This of and million, products to versus X% lease from in were quarter growth includes Subscription applications registrations other impact out sales offset impact First versus higher was $XX was Revenue core revenue DMS accounting acquisitions, revenue $XX was chain hardware acquisitions, of under Other million, lower revenue vehicle reflecting as XXXX. by

Now turning to earnings.

increases for entertainment was First driven higher Higher Travel quarter investment-related higher the EBITDA compensation also costs higher. $XXX by headcount expenses employee of annual X% effect in merit EBITDA million. increases, quarter. by took offset the and partially and which were revenue, on grew to income impact

expense was cash tax driven Our primarily effective benefited the the from per pricing period XX.X% rose benefit a $X.XX, the rate tax reflecting interest statute and one-time XX% by expiration in quarter. of the rate The limitations to of reduced net the tax for reduction Earnings rate to share related bringing also reduction tax quarter our in certain us in last debt international compensation matters. million paid transfer dividends lower from in the to late repurchased Free quarter Higher and the down million of $XX of in we restarted in $XX year. contributed the of $XX payments We $XX $XXX repurchases million quarter. incentive from common the we since flow program was cash million, XXXX last million stock, flow. free to year.

million $XXX stock We fiscal continue to XXXX. by the million expect end repurchase of $XXX of to to

X.X our to remains net sheet balance target Our EBITDA to of adjusted slightly with below still X.Xx, strong at Xx. debt

We the financials acquisition share our the the next reflect additional expect target back closing into Salty of as to as repurchases. when well range quarter get expected

Now turning guidance. to

with our and rate $X.XX XX.X% billion to an $X.XX $X.XX revenue We fiscal of million $XXX XX.X%. of EBITDA of billion of and $X.XX to to tax $XXX million are EPS guidance to XXXX maintaining effective

more lower Brian the inventories, business Similar the the the on in be to expected revenue solid dealer year, As in With seasonal to will EBITDA headwinds proud business, to XXXX remain financial in to slowdown before to continuing of mentioned, and revenue half. Thank contributions see performance growth transaction impact comparisons savings ongoing to open questions. track In the as last to for second first we of in similar as slightly including QX for targets based cadence, with and on year-over-year Joe the customers second the and to revenue offset the compared and half now quarterly move are in to to a flat growth acceleration our but in see respect growth XXXX. invest our Operator? support we expect cost to summary, QX, the line do accelerating lower QX expect acceleration. we innovation. through we to start forward XXXX the you. we look Roadster. transaction solid the with of remainder create we meet muted will sequentially initiatives And in in while QX, execution drive from normal QX an I'm had year we difficult before half

Operator

Instructions]. [Operator

from question comes first from Pfau William Matt Our Blair.

Matthew Pfau

I around the transactional wanted to the component. on ask commentary first

are are we're you expected terms you 'XX, earnings think supply the for in Are And the or have sort fiscal chain you improvements of they on when about that inventory just out what same to be as while. to a worsening then going of mean, saw your there first thinking expecting sort you the what I you call? of about relative the been So levels, the quarter? of challenges in last remainder

Brian Krzanich

So Eric Brian. I'll this and and is I then let can Joe voice-in. start,

First, bit oriented mostly around you like our less even should things registration transaction maybe little percent, XX-ish and just of a business is roughly checks. like remember credit

or have you're of types you those used whether selling still a so of transactions. car, And many new a

decrease, slight a what you than saw saw. we So less but

Eric, beyond bit that X% quite of to kind transactions, listen of you go So lot sales we at year. I in we not the seeing year fiscal least of go And it's don't at. they're And cars to don't change stay really saw than where think the XX% more a far, X% that as looked if will XX%. the that either. the inventories have decrease all, transaction both We a better. see see to dealerships changing whereas of this relative through Joe new like rate and OEM calls at as I or at it We impact by down abruptly XX%, anything think shouldn't so you happened else? our if either. through they're getting we rest

Joseph Tautges

I look lot automotive you collection. month-by-month data month only quite the large. add Slide at Matt, of And worse thing a actually if got The of spent September shows our around the we've you Yes. time, bit market, would presentation, posted the earnings is a for XX in it trend

over was COVID what shutdown. people as data, September sales say saw it, XX% looking system, you at you of low that our as go through software in during if our selecting So

performing well. Brian and that well, all quite so certainly a And very said, With continues model like dealers be headwind. is said, managing resilient it and are but our to business

Matthew Pfau

it. Got Understood.

subscription far Any of out expected? expectations. performing seems maybe to been than call ahead so specifically side obviously, that, has your would bit So you the areas business it been you offset a that what your have better like the then of

Brian Krzanich

anticipated of revenue mean you at really And a are of other again, growth. site, and continues I our it's there's drivers that which originally, there's Yes. than think and we if those overall the service, is bigger then X I the new have bit to go had in site continue that our factors to both just look of revenue our that what little a big probably well and, sales per two continued per just That DMS general, lot drivers, we now. increase gone elite -- retention. better

at is retention XX% I our and at, level highest the it's So between XX%. remember can

on to paranoid trying all products, phenomenal done of the support So better. to even that than a scores, actually we se improving our little I work forecast. per in customer little continued paying whole bit And think of we're the NPS always always And sure retention. and we've cautious always customer has satisfaction, we're making be better that that's off a

probably it's but we so little forecasted bit continued to well. a well as And lower, do

acquisitions. just So retention those and new two overall DMS products and then

Operator

next question Prestopino Barrington comes Our of Gary Research. from

Gary Prestopino

through go statistics you can you Joe, some that those of cited.

let to it. locations competitive XX-point that -- wins. me correct? had you said dealerships, X You X just Is repeat At

Joseph Tautges

see Overall, of comment larger, winning about growth the saw good excited sales subscription growth just installs. growth, but look spectrum, you look the as you to competitive the revenue in progress continue and we a momentum continuing we seen, sites. about site you we're Matt, talked very is more there. quarter, in applications, in are order Brian site When X.X% could the complex and good what we we've especially trend at multi-dealer Yes. wins the which to And the just really across those and see this and just as per is And at at acceleration.

were the over Our DMS for up XX% over installs QX QX. year-over-year,

pick up the business. core in lot a of to part seeing momentum continuing of subscription we're our good So

Gary Prestopino

digits, X% Okay. And revenue per double And double site that's was and Is correct? that all digits. up and then plus revenue up great then the news. X-point sites was

Joseph Tautges

Yes, that's correct.

Gary Prestopino

XX have now into that that Okay. you XXX% and Fortellis. integrated just And are correct? Fortellis, Is then in had transactions, a applications you increase with

Joseph Tautges

correct. That is

Brian Krzanich

Yes, that's correct.

Gary Prestopino

a dealerships into having going that's what know revenue. Fortellis is to get to And the of to of layered of I doesn't going how understanding that dealership make those all becomes to of point is get integrated for has access Fortellis works? and to that to impact it that have -- that or X applications impact these to because is therefore, it correct trying to Fortellis. connection Fortellis a there apps, everybody Okay. easier the idea statement lot But an having is sell every your how

Brian Krzanich

no. Yes,

that or allows API is an same third Roadster to -- off or Fortellis in allows applications, off of as out it APIs form parties Elead other against we and So And allows, algorithm oftentimes some layer it. data or post own the to our move calculation DMS create and or process also then off have their APIs.

So application maybe or inventory you build app an insurance parts management or whatever.

want a able dealers in APIs and what move car out data You do can can that. selling basis. or day of then through pull you and write a they're user whatever be to to on And per dealership, calculate per data can those

and want you're So to install or our to necessarily it dealer you, you a service you doesn't allow application. if download want

there we look Fortellis APIs that. allows the will better. work doesn't things application use the them is that question CPA want doing? enhances access root and Fortellis. you What to make parts It always be is and sure that's because understand you in way uses of Cox, to are out how value not in DMS, that within our -- free. think some example, value inventory, through and service there a that money, the And quite if moves we like API There our money value? make that can day, of that in in for and And that. Salty, is like what we types thing software low of each like the to what integrations those Salty business is help their integrated that they on then they really for our his you mentioned of There's statement at do, platforms. want way at data this if a end make is look of charge fees of really I we've our and do we that cost he the do. that ability our our somebody wait, that, the I Most if Roadster. a to your it of really at much that Salty all DMS, no It replacement actually and flows APIs. the necessarily to ways adding completely XXX-day of do can about is, to how or the add you just things because few And it for old The met management of calculation is, -- bit of into different to Xtime are we that uses though, of data Joe that the went we does amount Xtime service the applications our already a you our it and application is enhance thing understand a a get

of Fortellis of strength those All of the and that's done APIs. power the of because

accelerate those be acquisition. these with I the And Payments. these new new partnerships businesses of acquisitions to list you also a could Global could like allowing it's businesses. through us and CDK OnePay So host

in get I worth the bit be of more is that then than believe level the others that allows way data efficiently in out to to going integrations still a the quite over partner like transaction fees quicker do that to to time us that and money we have do happen. period. much But allows be several to a at the the flow quickly, and make worth ability these will way. actually going Those Fortellis APIs We the those works platform quite quite where us more are whole

Joseph Tautges

the others And then talk you competitive versus doing couple could add landscape. if about look B.K., add to If what create want a has who space, the of take what at for doing, to I are of you we obviously approach, just comments, what we're had a a Gary, said, the others come and competitors flexibility. are taking walled-garden this the OEM-centric world -- dealers new into very very view which consequences

of so part encompass will, Brian pick siloed-technology important with the part puts of into sort to open that's to our experience approach consumer so you if than have the rather heart an as And the have just more that of or, it them resonating agnostic and the for is be dealers is Fortellis, was saying, approach. at

Operator

of Our Zaffino question from comes next Ian Oppenheimer.

Ian Zaffino

younger the Was you Can did the tell for down dealer dealers? or Okay. three count me what flat? that up,

Eric Guerin

It is. I'll go.

secondly, you a we business out-of-business largely it stabilized. at largely think, it has it's better see consolidation. sequentially, Certainly, down I look you the when largely general I would due to you slightly. when it's at. bit. So what down sites That's And then than, the at or market It's a year-over-year, performing flattened. bit or you tell just see look

Ian Zaffino

then Okay. at what is maybe the investments, to far about as investment stable we on Perfect. are talked we and as of good like Salty going side what we of as or should look expect? we integration investment of the kind we guidance and increase kind are And

Brian Krzanich

good cautious beginning see question. level place in this not I to And plans we have see with see we it And a see right tell investment think committed now, we our in all efficiency. Salty We're that our would we're never very already But of everything That's I comfortable. right increase -- at right investment now. I've actually that little improvements level. with general, always of now and up. those. comfortable go We'll will we in -- we're will you,

we're translating part, just more For most the products. into moving on efficiencies those faster

increase so our level. And need more same, the to we don't see a significance we do any with able are with investment and to

Ian Zaffino

question. then And a final Perfect. Okay.

revenue the Or well. looking what to might or moving that of very But me there guess hit of it kind be? the rubber the this should very doing are disclose we plan all to is direction. seems opportunity could Because exciting. already. contributions we're KPIs kind maybe be Is expect forward? a right road sounds in what us to large how for It even going I the Fortellis

Brian Krzanich

we're -- the through just multiple kinds think wins, talk the can of and for of about is Fortellis basically a have There transactions be I to of and before retention make I own are And at you, DMS, for then very Yes. a part possible the see their Part make wins ways. tell that to convenient the out with and we transaction more significant the of you once to was I'd through They're that think the you're making it of making don't you'll tools available easy stabilized products. much a Fortellis. break through ton integrations deeper to dealer a Eric argue there's We're dealer we've provide we There's getting we And able data more when those. faster not And sure small us we're and life. do segment, of data value. a for other the some much, and not reason, ways. easily. to doing then money just regulations. at understand we and it all dealers money of totally revenue Fortellis. of acquisitions partnerships that extract can because -- small rate rates make it, getting integration you fees in and some rules right? there's add asked a bunch I reason, that we our much you again, and

made agnostic, are we're we're retention that that's open because are because and acquisition the dealers our that happy so are dealers comment and And is wins up. more more Joe satisfied, with

but we with through we're being much to money through even and cost transactions, that acquire making deeper and lower and are at much those of simpler multiples and and much a much integrations able level. companies make partner We faster

real always so And be would to it is. calculate revenue hard Fortellis of the what

have you So a if at and Fortellis. didn't look took you Salty,

we you at and a XXX-day Salty. didn't took plan You look on have or Instead like of plan a XX-day Roadster, had a Fortellis.

not integrate those months, talking get be same results. and in the quarters, to things order You'd if

give on to to that the an exact anyway. will me so always value you hard number that's be real And

Operator

Instructions]. [Operator

Stanley. comes Josh next Baer, Our Morgan question from

Jian Huang

is This Huang from Bob Josh. can in Morgan start Stanley, we for with entity. the insurance filling Maybe

increase percent or temporary on holding kind premium? away? of down, environment premiums -- Given fee you tailwind market, or environment somewhat What this from competitive And premium a additional as about, that like structure Salty auto number? one, the a in it you talk revenue of is fee auto structure in also, a the is does of ease kind relationship, competitive it is if maybe the number with that were this can and flat the Is dies your it percentage carriers? we're see two, would insurance competitive a

Joseph Tautges

thanks for Thanks us today. joining questions, for your and

incremental getting talked it carriers. right you just when tech Progressus, a It described opens it, deal with and very, creates of minutes, Brian's great with excited. better very up Are insurance? insurance talked really resonates travelers, the insurance with with integration really when we're dealers, for so if Fortellis, -- this the to with provides seamless is a they Salty, on to $X want we've insurance our experience. And we about within And for And at consumers value have really bind work dollar a end about very at can the moment it their Salty consumer on they to opportunity billion do dealership we us. So just TAM carriers. full want a much create of an multibillion and look they dealers. they It's Yes, purchase, lineup at experience benchmark. we've buying strong

have we think bring of unique base get fee disclose to We our details that structure. business. of into terms won't I the to opportunity a all across

right? I connect connecting that the We a commission insurance with of it is brokerage provide part insurance. of are the think and really carriers for opportunity it's in the binding to to similar to very consumer, -- that as structure a brokerage an provides relationship,

level those you And aligned that what achieve. for other traditionally I'd brokerage think at you. leave so see agents rates And are with I

it's insurance right? modernize elements of has vehicle, about a about the transforming being better the company, really situation. perspective, buying of integration to it When a a car guest the you in the experience it, journey this we're is consumer case pivoting entire about how bought, all including say really our in how or all So for dealership, the

Brian Krzanich

but thing with share little So of our thing Joe, one the a [indiscernible]. we is I'd is the about that thing, commission comment add for to portion The one that's a unique just one thing one Joe's Bob, the dealer.

whole So the process. dealer is incentivized in this

so Salty they so grow. our a automates this DMS, business -- And integration process to the is again, into want the This that flow. of see

the seamless, because percentage dealer incentivized as this and they're of dealer to is both well. the the and it's So a consumer getting to

more we model and ours business very yes, really now value right up. those go be will faster incentivizes interested so a as can grows so hence, And grow. really we insurance focused a at rates that providing interesting be ones sure, the competitive percentage grow, future. to And up, of then become our And then, can them less if but those our a the on the consumer, they and would But is the based find, percentage, markets think propel that that's a we on that we're went to business us into rate.

Jian Huang

That's Okay. helpful. very

that you asked in added characterize and you how just size? dealer other for maybe think quarter-on-quarter. different that larger business, the So forward? was if going talk is maybe earlier, And sites segments, auto question, Can the your DMS XX in results you so. the this directionally where another would dealer about apologies And strength size, you small market

Joseph Tautges

lot a of there's board. think positivity I the Yes, across

as that some midsized some I these year-over-year of dealership consolidations. the tell we've to see dealers look the the on you growth starting hitting midsized would is growth, at consolidation cylinders, consolidation care the just we're really the is that seeing dealers experienced sales in accelerate automotive when marketing team, really some right marketplace. all we're working consuming substantial And well you frankly. that now, at And team, the acceleration the smaller dealers. dynamics, I I customer of are technology you, market well think the teams how sequentially the of some performing team, When look together. The think dealers both really really as and we're consuming the of of you largest team the team, quite implementation around an

recall, you If dealers. larger the over-indexed we to

plus. those is consolidation that that's for who and nice model. to happen to X we So tailwind continue quite The our expect a are happening multi-rooftop really business

for so yes, growth. think I you're the sequential calling right out XX-site And

bigger We will consistently customers nonetheless, who we're record pretty perform We're seeing that are continue that seeing buying, there. ebb forward. there's and as to and we our some sales see consolidating, quarters But here flow Clearly, great and are we that Seeing and mid- connector, is keep business And single-digit wins. go you all the clean you print will, pushing for. growth quarter and that. partner the OEM, consolidation the see higher our a strategic if between really to we benefiting from with retention. dealer

Operator

call for [Operator back this closing showing Brian Instructions]. no like further Krzanich over I'd at I'm to questions time. the turn any remarks. to

Brian Krzanich

we everyone to this excited thank said, just like business. conference. first great I about questions. Those as would were We're, for operator. really Thanks, attending our

quarter represents with as mentioned. right Eric and our really this forecast, think of start I XXXX target the on our

And so the thanking to continue leave job. with employees, do I'd to all just a CDK who of right, like great

improvements team continued to the our has strong. Even as is a COVID Sales factor, team our to growth. has play continued accelerate and

Just overall, the whole organization is doing great.

we'll thank and quarter. you, all see So you next

Operator

today's participating. Ladies you and this conclude Thank all does for conference. gentlemen,

now Have may disconnect. day. great a You

CDK Global (CDK) 3 Nov 212022 Q1 Earnings call transcript