Despite market headwinds, online wholesale automotive marketplace company ACV Auctions Inc. drove up second-quarter revenue 29% year over year to $161 million on gross merchandise volume of over $2 billion.

George Chamoun, CEO, ACV Auctions

CEO George Chamoun said ACV grew revenue even though “dealer wholesale volumes remained below historical levels due to a combination of soft retail sales and the ongoing shortage of used vehicle inventory.” He noted that automotive industry retail sales were also hampered by the hacked CDK Global dealer-management software system widely used by car dealerships

Chamoun added that ACV was pushing ahead with its ACV Solutions suite of marketplace management and data services designed to help dealers increase online conversion rates and grow sales and profits. ACV Auctions hosts buy-and-sell transactions by car dealers, including what it describes as the “top 100 used-car dealers in the United States.” The company says it hosted 186,526 sales transactions in the second quarter, up 21.8% from the year-earlier quarter, with gross merchandise volume exceeding $2 billion.

ACV Auctions cites strong conversion rates

On a Q2 earnings call, Chamoun said marketplace sellers showed “strong conversion rates,” without citing specific figures. He attributed the conversion rate increase to “features like advanced search, vehicle merchandising, AI-enabled pricing data, and flexible auction formats are delivering what we believe is the best dealer buying experience in the market,” according to an earnings call transcript from Seeking Alpha.

ACV’s suite of cloud-based software for marketplace sales includes the ACV Max dealer merchandising and inventory management application and the ClearCar self-service vehicle inspection system.

Chamoun said ClearCar is live at nearly 900 dealerships, adding, “Based on transaction data, we estimate that dealers using ClearCar are increasing retail profits by 10%, improving inventory turns, and increasing wholesale profits nearly 20% relative to legacy tools.”

ACV “delivers science”

“With ACV Solutions, we are delivering science,” he added. “Our [motor vehicle] appraisal solutions incorporate AI imaging for damage detection and real-time localized pricing that is condition-enhanced based on millions of inspections in our data mode. It’s still early days in this category, but we believe self-inspection can unlock a number of exciting long-term growth opportunities, including total addressable market expansion.”

William Zerella, chief financial officer, said ACV’s “SaaS (software-as-a-service) and data services products comprised 5% of total revenue.”

Overall marketplace services revenue was 38% of total revenue and grew 30% year-over-year.

ACV marketplace GMV hits $2.4 billion

For the second quarter ended June 30, ACV reported:

• Total revenue of $161 million, an increase of 29% year over year.
• Marketplace and Service Revenue of $144 million, up 32%.
• Marketplace GMV of $2.4 billion, down 1%.

• A net loss of $17.06 million, compared to a year-earlier net loss of $15.58 million.

For the six months ended June 30:

• Total revenue increased 25.6% to $306.31 million.
• Marketplace and service revenue rose 27.9% to $273.94 million.
• A net loss of $37.53 million, compared to a year-earlier net loss of $33.78 million.

For the full year 2024, ACV said it expected revenue to increase between 28% and 30% to a range of $615 million to $625 million.

Paul Demery is a Digital Commerce 360 contributing editor covering B2B digital commerce technology and strategy. [email protected].

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