Cars.com Inc. (CARS) stock plummeted 7.24% in Thursday's trading session following the company's mixed first-quarter results and the suspension of its full-year 2025 revenue guidance. The online car marketplace reported revenue of $179 million, slightly below the analyst estimate of $179.79 million, while adjusted earnings per share came in at $0.37, beating the expected $0.11.
The primary catalyst for the stock's decline appears to be the company's decision to suspend its full-year revenue guidance. Cars.com cited uncertainties surrounding the global tariff situation as the main reason for withdrawing its outlook. While the company reaffirmed its full-year adjusted EBITDA margin guidance of 29% to 31%, the lack of revenue visibility has unsettled investors.
Despite the disappointing overall results, Cars.com saw some positive trends in its business segments. Although subscription-based dealer revenue, the company's largest segment, declined 2% due to economic pressures on dealers' marketing spending, revenue from automakers and its national business grew by 6% as competition among automakers intensified. The mixed performance across segments and the ongoing tariff concerns have left investors cautious about the company's near-term prospects, leading to the significant stock price drop.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.