OPENLANE (KAR) investor relations material

Executive summary

• Q2 2025 revenue grew 9% year-over-year to $482M, with adjusted EBITDA up 21% to $87M, driven by strategic investments and strong marketplace performance.

• Dealer-to-dealer volumes rose 21%, marking the third consecutive quarter of double-digit growth, and auction fee revenue increased 24%.

• Income from continuing operations increased 212% to $33.4M, and operating profit more than doubled to $47.4M.

• Finance segment managed receivables grew, loan loss rate held at 1.5%, and adjusted EBITDA increased.

• Full-year 2025 guidance for adjusted EBITDA and operating adjusted EPS was raised, reflecting confidence in continued execution and market opportunity.

Financial highlights

• Q2 2025 consolidated revenue was $482M, up 9% year-over-year, with adjusted EBITDA at $87M and margin expansion to 18%.

• Operating profit for Q2 2025 was $47.4M, up from $23.9M year-over-year.

• Adjusted free cash flow for Q2 2025 was $87M, with a 100% conversion rate; trailing twelve-month conversion rate improved to 91%.

• Marketplace segment adjusted EBITDA grew 36% to $45M, with margin expansion of 220 basis points.

• Finance segment net margin stable at 13.6%, with provision for credit losses down to 1.5%.

Outlook and guidance

• Full-year 2025 adjusted EBITDA guidance raised to $310M–$320M; operating adjusted EPS guidance increased to $1.12–$1.17.

• CapEx guidance unchanged at $50M–$55M.

• Expect commercial vehicle volumes to increase from Q2 2026 onward, driven by off-lease maturities and lower consumer buyout rates.

• Guidance excludes potential impacts from future business development, litigation, tax, FX, and regulatory changes.

• Anticipate continued investments in expanding buyer and seller networks, with some deceleration in EBITDA growth in the second half due to seasonality and ongoing investments.