Cars.com Adjusted EBITDA Margin Beats Guidance

The Tip Desk · November 11, 2026 · 3 min read

Adjusted EBITDA reached $55.8 million and a 30.7% margin in the third quarter, 70 basis points above the 30.0% top of the 29.0% to 30.0% range the company reaffirmed for 2026.

Cars.com Inc. (CARS), an audience-powered automotive marketplace, reported third-quarter revenue of $181.9 million, up slightly from a year earlier, as Marketplace revenue grew and cost discipline supported profitability.

Net income was $16.3 million, or $0.30 a share, compared with $7.7 million, or $0.12 a share, a year earlier. The company said the change was primarily attributable to higher operating income. Adjusted net income was $32.3 million, or $0.58 a share.

Adjusted EBITDA was $55.8 million, or 30.7% of revenue, versus $54.6 million, or 30.1% of revenue, in the year-ago quarter. That margin was 70 basis points above the 30.0% top of the 29.0% to 30.0% full-year range. Sequentially, Adjusted EBITDA had been $53.0 million (29.4% margin) in the second quarter and $51.0 million (28.3% margin) in the first.

Subscription-based Dealer revenue was $163.4 million, up 1% year-over-year, after 3% growth in the second quarter and 2% in the first. The company attributed the increase to greater Marketplace value delivery and customer count, partially offset by a decline in media and solutions products. Marketplace revenue was up 5% year-over-year, after growing over 7% in the second quarter, which the company called the fastest quarterly growth rate since 2021. Premium+ package adoption reached 12% for the quarter.

OEM and National revenue was $15.7 million, down 3% year-over-year but up 15% from the second quarter as OEM advertising recovered sequentially. Dealer customers were 19,251, down 1% year-over-year. Monthly average revenue per dealer rose to $2,532, up 3% year-over-year, which the company said set its second-highest quarterly record.

Average monthly unique visitors were 24.7 million and traffic was 150.2 million visits, up 8% and 5% sequentially from the second quarter. The company said those figures reflected continued optimization of audience acquisition strategy, which delivered robust year-over-year growth in lead volume. A new self-service Marketplace Starter offering was adopted by nearly 400 independent dealers.

Total operating expenses were $153.0 million, down 7% year-over-year. Adjusted operating expenses were $142.4 million, down 5% year-over-year. The company said depreciation and amortization continued to decrease and that it drove operating leverage through active cost management and improved efficiencies in general and administrative and sales and marketing expenses.

For the nine months ended September 30, 2026, net cash provided by operating activities was $114.7 million and free cash flow was $97.3 million. The company repaid $5 million of debt in the quarter, leaving total debt outstanding at $445.0 million. Total liquidity was $369.6 million, defined as cash and cash equivalents of $64.6 million and revolver capacity of $305.0 million.

Cars.com repurchased 1.4 million shares for $16 million in the third quarter. Year-to-date repurchases totaled 7.6 million shares for $74 million and are on pace to the 2026 target of $90 million. Shares repurchased and retired through September 30 represented over 12% of common shares outstanding as of prior year-end. About $100.2 million remains available under the current authorization, which expires in February 2028.

The company reaffirmed full-year 2026 guidance of revenue flat to up 2% year-over-year and Adjusted EBITDA margin of 29.0% to 30.0%. Chief Executive Officer Tobias Hartmann said third-quarter results reinforced the growing strength of the scaled Marketplace and that the company is moving to extend that momentum across the rest of its portfolio.