CarGurus, Inc. reported a revenue of $234.0 million for the three months ended June 30, 2025, marking a 7% increase from $218.7 million in the same period last year. The company's net income for the quarter was $22.3 million, a significant turnaround from a net loss of $68.7 million in the prior year. For the six months ending June 30, 2025, total revenue reached $459.2 million, up 6% from $434.5 million in the first half of 2024, with net income of $61.4 million compared to a loss of $47.4 million in the previous year.
The financial performance was bolstered by a 14% increase in marketplace revenue, which accounted for 95% of total revenue in the latest quarter. This growth was attributed to an increase in the number of paying dealers and higher average revenue per subscribing dealer (QARSD). However, wholesale revenue saw a decline of 52% to $6.3 million, primarily due to a 55% drop in transactions processed through the CarOffer platform, reflecting challenges in the Digital Wholesale segment. Product revenue also decreased by 45% to $5.8 million, driven by lower transaction volumes.
In a strategic shift, CarGurus announced plans to wind down its CarOffer subsidiary, which includes the Dealer-to-Dealer and Instant Max Cash Offer products. This decision, made on August 6, 2025, was based on a reassessment of the business's effectiveness in a volatile pricing environment. The company expects to incur costs between $14 million and $19 million related to this wind-down, with completion anticipated in the second half of 2025. The move aims to refocus efforts on enhancing technology and analytics for vehicle sourcing and pricing.
Operationally, CarGurus reported an increase in its customer base, with 33,095 paying dealers as of June 30, 2025, compared to 31,352 a year earlier. The company also experienced a rise in average monthly unique users and sessions, indicating improved engagement on its platforms. However, the Digital Wholesale segment's losses decreased significantly, reflecting a reduction in impairment charges from $127.5 million in the previous year to $29.6 million in the latest quarter.
Looking ahead, CarGurus remains focused on leveraging its marketplace strengths while managing the transition away from CarOffer. The company anticipates that the wind-down will allow for greater operational efficiencies and a more streamlined focus on its core marketplace offerings. The outlook for the remainder of 2025 includes expectations for continued revenue growth, albeit tempered by the anticipated decline in wholesale and product revenues as the CarOffer business is phased out.
About CarGurus, Inc.
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