ACV Auctions Posts Record Revenue as Volume Stalls
Adjusted EBITDA reached $21 million, topping the company’s prior guidance by $1 million.
Online wholesale auto marketplace ACV Auctions (ACVA) reported record second-quarter revenue even as marketplace transaction volume was approximately flat from a year earlier.
Revenue growth slowed for a fifth consecutive reported quarter, easing to 10% from 12% in the first quarter and 21% a year earlier. The deceleration accompanied flat gross merchandise value and unit volume, shifting the quarter’s growth toward higher monetization and customer assurance.
Revenue rose 10% to $213.9 million and increased about 5% sequentially from $204 million. The GAAP operating loss narrowed to $6.0 million from $7.2 million, while the net loss widened to $8.2 million from $7.3 million as interest and other expenses increased.
Marketplace and service revenue rose 8% to $189 million, slowing from 10% growth in the previous quarter. Customer assurance revenue increased about 39% to $24.7 million and accounted for roughly 11.5% of total revenue, up from 9.1% a year earlier.
Marketplace GMV held at about $2.7 billion, while units were approximately flat at 211,472 and declined about 1% sequentially. Adjusted EBITDA margin expanded to about 9.8% from 8.3% in the first quarter, as adjusted EBITDA increased from $17 million sequentially and $19 million a year earlier.
ACV reaffirmed full-year revenue guidance of $845 million to $855 million and adjusted EBITDA guidance of $73 million to $77 million. The company now expects the dealer wholesale market to stabilize during the second half, compared with its earlier assumption of a mid-single-digit percentage decline for the full year.
The company improved its full-year GAAP net-loss forecast to $44 million to $49 million and reduced its expected increase in non-GAAP operating expenses, excluding cost of revenue, to about 6% from 8%. First-half operating cash flow fell to $41.0 million from $80.3 million as the contribution from accounts payable declined.
ACV also named Tim Fox chief financial officer effective Aug. 11, succeeding Bill Zerella, who was leaving for another company and will remain an adviser through Oct. 2.