Cars.com Inc. reported fourth‑quarter revenue of $183.9 million, a 2% increase from the same period a year earlier, and a full‑year revenue of $723.2 million, up 1% YoY. The growth was driven by a modest rise in dealer customers, which increased to 19,544, and by a 3% YoY increase in dealer‑segment revenue of $164.4 million.
The company’s adjusted earnings per share for the quarter were $0.44, falling short of the consensus estimate of $0.56 and missing by $0.12, or 21.4%. The miss reflects higher marketing and compensation expenses that outweighed the modest revenue growth.
Segment analysis shows dealer revenue at $164.4 million, up 3% YoY, while OEM and National revenue declined to $16.2 million, a 9% drop. The decline in the OEM and National segment offset the dealer growth and contributed to the overall earnings miss.
Adjusted EBITDA for the quarter was $54.9 million, or 29.9% of revenue, slightly below the 30.8% margin reported a year earlier. The margin contraction is attributed to increased marketing and compensation costs, as well as higher technology investment expenses.
For 2026, Cars.com expects revenue to remain flat to slightly higher and adjusted EBITDA margins to stay in the 29%‑30% range. CEO Tobias Hartmann said, "Our focus is squarely on driving further financial improvements in 2026 by leveraging and enhancing our marketplace flywheel. We plan to develop more interconnectivity across our solutions to amplify differentiation and unlock product adoption. At the same time, we will evaluate our cost structure to operate more efficiently." The guidance signals cautious confidence amid ongoing margin pressure.
The market reacted negatively to the earnings miss, with the stock experiencing a pre‑market sell‑off of approximately 14.8%. Investors focused on the earnings shortfall, which outweighed the record full‑year revenue and dealer‑customer growth.
The content on EveryTicker is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.