#USA #Chicago #financial results #revenue growth #Cars.com

Cars.com Reports Fourth Quarter and Full Year 2025 Results

Cars.com Inc. (NYSE: CARS), a well-known technology platform focused on the automotive sector, recently announced its financial outcomes for the fourth quarter and the entirety of 2025. With a growing demand for effective tools and insights, the company's performance reflected both resilience and determination to thrive in a challenging market.

Financial Performance Highlights

Cars.com achieved a record revenue of $723 million for the full year, marking a 1% increase from the previous year. This growth was primarily driven by an uptick in dealer revenues, which were bolstered by an increased customer base that now counts 19,544 dealer customers — a remarkable 2% growth over the previous year.

During the fourth quarter of 2025, revenue rose to $183.9 million, a 2% increase from the same period last year. Subscription-based dealer revenue contributed $164.4 million, reflecting a 3% year-over-year increase due to effective consumer engagements and market strategies.

Operational Highlights

In addition to revenue growth, Cars.com also reported significant operational efficiencies. Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for the year reached $211.1 million, slightly outpacing the $209.7 million recorded in 2024.

Despite the positive revenue trends, net income experienced a decrease, totaling $20.1 million for the year, compared to $48.2 million in 2024. Executives attributed the shift to changes in acquisition-related fair values and previous gains recorded from equity investments. Notably, adjusted net income declined by 6% year-over-year but remained stable from an earnings-per-share perspective.

Strategic Insights

Tobias Hartmann, CEO of Cars.com, noted that the company's marketplace and product suite are vital to capturing the rising demand for simplified car-buying experiences driven by trusted data insights. The plan moving forward includes enhancing interconnectivity across solutions and evaluating cost structures for more streamlined operations.

The focus for 2026 appears set on capitalizing on financial improvements while ensuring stakeholder value creation remains at the forefront. With an ambitious strategy, Cars.com aims to bolster growth through innovative platforms and user-centric products.

Cash Flow and Shareholder Commitment

Cars.com also demonstrated a strong commitment to shareholder value, repurchasing 7.1 million shares at a total cost of $86 million throughout 2025. This initiative indicates the company's ongoing dedication to returning value to its investors while managing a balanced approach towards cash flow and operations. Free cash flow was reported at $125.7 million, reflecting the company’s capacity to generate robust capital and support such initiatives.

Outlook for 2026

As management looks toward the first quarter of 2026, revenue expectations are set to be flat or slightly higher, driven by strong performance in dealer subscriptions and website products, albeit with potential headwinds from OEM advertising spending. The adjusted EBITDA margin is anticipated to range between 26.0% and 27.0% in the first quarter, reflecting a mix of changes in revenue and operational expenses.

The overall outlook for 2026 remains bullish with estimates suggesting revenue could rise between flat to 2% compared to the previous year. Cars.com is well poised to enhance its marketplace through sustainable practices, focusing on both profitability and long-term value creation.

Conclusion

Throughout 2025, Cars.com has displayed a resilient stance amidst evolving market conditions, maintaining its position as a leader in automotive technology. As it continues to innovate and expand, the company shows promise in delivering enhanced value both to its dealer customers and shareholders, fostering a vibrant automotive ecosystem.

For more updates on Cars.com's strategies and future growth initiatives, the management will host a conference call today at 800 AM CT, accessible via the Cars Commerce Investor Relations website.