Cars.com (CARS) Q4 2025 earnings summary

Executive summary

• Achieved record full-year 2025 revenue of $723.2 million, up 1% year-over-year, with Q4 revenue of $183.9 million, up 2%, driven by dealer revenue growth and expanded customer base to 19,544 dealers.

• Dealer revenue grew 3% year-over-year in Q4, while OEM and national revenue declined 9% due to lower OEM ad spend.

• CEO outlined a renewed focus on integrating marketplace and product offerings, aiming for operational efficiency and long-term growth.

• Repurchased 7.1 million shares for $86 million, retiring 9% of shares outstanding and deploying nearly 70% of free cash flow for buybacks.

• Adjusted EBITDA for 2025 was $211.1 million (29.2% margin), flat year-over-year.

Financial highlights

• Net income for 2025 was $20.1 million ($0.32 per diluted share), down from $48.2 million ($0.72 per share) in 2024, mainly due to prior-year gains and acquisition-related adjustments.

• Adjusted net income for 2025 was $108.1 million ($1.71 per share), slightly down from $114.9 million in 2024.

• Free cash flow for 2025 was $125.7 million, with 60% conversion from Adjusted EBITDA, slightly down from $128.1 million in 2024.

• Adjusted operating expenses for 2025 were $603.9 million, down 2% year-over-year.

Outlook and guidance

• 2026 revenue expected to be flat to up 2% year-over-year; Q1 2026 revenue expected to be flat to up 1%.

• Adjusted EBITDA margin for 2026 projected at 29%-30%; Q1 margin expected at 26%-27%.

• Dealer revenue growth anticipated from marketplace and website repackaging, customer base expansion, and product adoption; OEM/national revenue expected to remain flat to down.

• Minimum $60 million in share buybacks planned for 2026, with potential for more if excess free cash flow is available.