ACV Auctions Inc. (NASDAQ:ACVA) Q3 2022 Results Conference Call November 9, 2022 5:00 PM ET

Company Participants

Tim Fox - VP, IR

George Chamoun - CEO

Bill Zerella - CFO

Conference Call Participants

Chris Pierce - Needham & Company

Naved Khan - Truist

Rajat Gupta - JPMorgan

Eric Sheridan - Goldman Sachs

Daniel Imbro - Stephens

Operator

Ladies and gentlemen, thank you for standing by, and welcome to the ACVA Third Quarter 2022 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question and answer session. [Operator Instructions]

I would now like to turn the call over to your host, Tim Fox, you may begin.

Tim Fox

Thank you, operator. Good afternoon, and thank you for joining ACV's conference call to discuss our third quarter 2022 financial results.

With me on the call today are George Chamoun, Chief Executive Officer; and Bill Zerella, Chief Financial Officer. Before we get started, please note that today's comments include forward-looking statements, including statements regarding future financial guidance. These forward-looking statements are subject to risks and uncertainties and involve factors that could cause actual results to differ materially from those expressed or implied by such statements.

A discussion of the risks and uncertainties related to our business can be found in our SEC filings and today's press release, both of which can be found on our Investor Relations website. During this call, we will discuss both GAAP and non-GAAP financial measures. A reconciliation of GAAP to non-GAAP financial measures is provided in today's earnings materials, which can also be found on our Investor Relations website. And with that, let me turn the call over to George.

George Chamoun

Thanks, Tim. Good afternoon, everyone, and thank you for joining us. We are very pleased with our third quarter performance, with revenue in line with guidance and EBITDA exceeding guidance on Slide 4. Our market momentum continued in the third quarter with revenue of $105 million, a year-over-year growth of 15% versus strong results in Q3 '21. Despite a modest year-over-year decline in units, GMV grew to $2.1 billion due to an increase in ARPU, which was driven by a strong vehicle mix and also wholesale price inflation.

Overall, we are very pleased with our execution in Q3 and our progress and key strategic initiatives. We delivered strong results despite an automotive market facing continued supply constraints, weakening retail demand, and vehicle price appreciation. Because market conditions are expected to remain challenging in Q4, we have assumed that wholesale volumes and conversion rates will be compressed through the balance of the year. Our guidance reflects this more cautious view of current market conditions while also reflecting a balance between investing in growth and maintaining a clear path to profitability.