2023 was a good year for motor vehicle online marketplace and data services company ACV Auctions Inc., but 2024 is on course to be much better, CEO George Chamoun said yesterday.
Following last year’s 14% revenue increase to $481 million, as marketplace gross merchandise volume reached $8.8 billion, Chamoun gave guidance of up to 30% revenue growth this year to over $600 million.
George Chamoun, CEO, ACV Auctions Inc.
“While dealer wholesale volumes remain below historical levels, new vehicle production and retail sales are improving, which are key factors supporting a wholesale market recovery,” he said, adding, “We launched new solutions that expand our addressable market and drive operating efficiency, which we achieved while continuing to increase margins.”
ACV’s marketplace and digital data services support transactions for buyers and sellers of new and used motor vehicles, including many late-model cars newly off-lease. As more vehicles enter the market, demand increases among dealers and other businesses to use ACV’s services to either acquire more hot-selling vehicles or sell off excess inventory.
Serving 24,000 motor vehicle dealers
Donovan Jones, a research analyst and the head of investment group IPO Edge, says ACV has more than 24,000 dealers and commercial partners in its system and has facilitated hundreds of thousands of wholesale transactions since the company’s inception in 2014.
At the 2024 National Automobile Dealers Association Show in Las Vegas last month, ACV showcased several digital technology marketplace features, including:
- Max Digital technology, with ACV’s market data, for dealers to appraise vehicles.
- AI imaging, APEX and Virtual Lift applications for confirming the condition of vehicles.
- A ClearCar AI-powered imaging and vehicle-inspection tool designed to help dealers source and determine the value of inventory from consumers.
ACV gets an anti-trust settlement
ACV also announced yesterday the settlement of its anti-trust litigation against Carvana-owned auto marketplace Adesa U.S. and other auction industry companies, clearing its ability to license and use the AutoIMS technology platform to connect with businesses, or consignors, that use wholesale auctions to sell vehicles to dealers and other commercial buyers.
In its lawsuit (ACV Auctions, Inc. v. National Auto Auction Association, Inc., et al.), in U.S. District Court for the Western District of New York, ACV charged Auto Auction Services Corp., which manufactures the AutoIMS, and six other companies with conspiring to prevent ACV from using the platform.
ACV says that, by winning the case, it is now able to “deploy AutoIMS in a way that supports ACV’s digital-focused business model” and to also provide services to the 1,300 commercial consignors that use AutoIMS to connect with hundreds of physical auctions.
For the fourth quarter ended Dec. 31, ACV reported:
- Revenue for the fourth quarter ended Dec. 31 increased 21% year over year to $118 million.
- Net loss narrowed 5% to $23.24 million.
- Marketplace gross merchandise volume grew 6% to $1.8 billion.
- Marketplace vehicle unit sales increased 15% to 143,999.
For the full year, ACV reported:
- Revenue increased 14% to $481 million.
- Marketplace gross merchandise volume grew 2% to $8.8 billion.
- Marketplace vehicle unit sales grew 10% to 598,767.
- Net loss narrowed 26.4% to $75.26 million.
- The non-GAAP loss was $16.01 million after factoring in $49.65 million in stock-based compensation and other expenses.
- Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) loss narrowed to $18 million from $56 million in 2022.
Based on recent and expected market trends, ACV said its full-year 2024 guidance projects 27%-30% revenue growth to $610 million to $625 million, for net income loss of as much as $62 million.
Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports. Here’s last quarter’s MSC Industrial report.
Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. paul@digitalcommerce360.com.
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