Inc. (NYSE:CARS) Q3 2019 Earnings Conference Call - Final Transcript

Nov 06, 2019 • 10:00 am ET

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Good morning, and welcome to the's Third Quarter 2019 Earnings Conference Call. Hosting the call this morning is Alex Vetter, Chief Executive Officer; and Becky Sheehan, Chief Financial Officer. This call is being recorded, and a live webcast can be found at A replay of the webcast will be available at this website until November 20, 2019. A copy of the accompanying slides can be found on the IR website. Following the presentation, there will be a question-and-answer session with Alex and Becky.

I'd now like to turn the call over to Jandy Tomy, Vice President of Investor Relations. Please go ahead.

Jandy Tomy,

Good morning, everyone and welcome to our Third Quarter 2019 Earnings Conference Call. Before I turn the call over to Alex, I'd like to draw your attention to our forward-looking statements and the description and definition of our non-GAAP financial measures, which can be found in our presentation. We will be discussing certain non-GAAP financial measures today including adjusted EBITDA, adjusted EBITDA margin, adjusted net income, and free cash flow. Reconciliations of these non-GAAP measures to the most directly comparable GAAP measure can be found in the financial tables included with our earnings press release and in the appendix of the presentation.

For more information, please refer to the risk factors included in our SEC filings, including those in our annual quarterly and current reports. assumes no obligation to update any forward-looking statements or information as of their respective dates. And at this time, I'd now like to turn the call over to Alex.

Alex Vetter

Thank you, Jandy. Good morning, everyone and welcome to our conference call for the third quarter of 2019. In this morning's call, I'll be discussing our third quarter business performance and then hand the call over to Becky, who will discuss our financial results. Our third quarter results were in line with expectations that we laid out on our last call.

There are a few highlights that I like to discuss today. First, we completed our final affiliate market conversions which gives us complete control over our entire customer network. With our affiliate sales model now behind us our sales team is able to support dealers in these markets directly and more effectively, increase our sales and service in these territories. Second, we took over as the number one player in SEO, which reinforces the strength of our brand and demonstrates our technical sophistication and validates our product strategy to deliver high-quality content.

Third, this quarter we announced a partnership with General Motors, which opens the door for us to sell our website solutions to over 4,000 new dealers across the country. And this creates more opportunities to sell a broader set of products and solutions. And lastly, we achieved these milestones, while generating significant operational efficiencies, most notably our sales and tech transformations. As we discussed on our last earnings call, we're further along with dealer retention and cancellation rates which have stabilized. Our investments in product and audience are