The B2B marketplace business for CarGurus Inc. is running on empty.

For the second quarter ended June 30, CarGurus posted total revenue of $218.7 million. That’s a 9% drop from revenue of $239.7 million in the Q2 2023. Net loss was $93.58 million. That compares with net income of $17.73 million in the prior year.

CarGurus is a digital auto platform for shopping, buying, and selling new and used vehicles. The major drop in revenue came from CarGurus’ once red hot wholesale marketplace platform for dealers.

CarGurus B2B marketplace

In the second quarter, wholesale marketplace revenue declined year over year by 59%. That’s down to $13.1 million from $32 million in Q2 2023. For the first six months of the year, wholesale marketplace revenue for CarGurus declined to $26.9 million. That’s down 49% from $46.5 million.

The decrease in wholesale revenue was “driven by a decline in dealer-to-dealer transaction volume as we continue to focus on rebuilding our commercial pipeline and reinvesting in our product in a disciplined manner, with the ultimate aim of returning to profitable growth,” chief financial officer Elisa Palazzo told analysts on a recent earnings call.

CarGurus’ purchased CarOffer outright in December. The company was CarGurus’ wholesale platform for dealers. CarGurus acquired a 51% stake in CarOffer in 2021. CarGurus bought a controlling stake in CarOffer three years ago when demand — and pricing — for used vehicles was much higher because of the pandemic.

But the market has since cooled considerably, CarGuru CEO Jason Trevisan told analysts.

“Our product is better today at CarOffer than it was two years ago,” Trevisan said. “But two years ago, it was processing significant volume in large part because wholesale prices are rising so much. We’ve made a number of enhancements to the platform, and it’s to give buyers and sellers confidence that they will conduct a great transaction, it’ll be a broad experience, and they will. For buyers, they will end up with a car that they’ll make money with. To do that in a price-declining or highly price-volatile environment, you need more insights and more safeguards.”

CarGurus, formed in 2006, is a Cambridge, Massachusetts-based automotive research and shopping website that assists users in comparing local listings for used and new cars, and contacting sellers.

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