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CARS Reports Fourth Quarter and Full Year 2021 Results

·25 min read

Delivers Double-Digit Full-Year Growth in Revenue

Achieves Robust Annual Growth in Dealer Customers and ARPD

Announces $200 Million Share Repurchase Program

CHICAGO, Feb. 24, 2022 /PRNewswire/ -- Cars.com Inc. (NYSE: CARS) ("CARS" or the "Company"), a leading automotive marketplace platform that provides a robust set of digital solutions, today released its financial results for the fourth quarter and year ended December 31, 2021.

(PRNewsfoto/Cars.com Inc.)
(PRNewsfoto/Cars.com Inc.)

Q4 2021 Financial and Key Metric Highlights

  • Revenue of $158.3 million, up $5.3 million, or 3% year-over-year

  • Net loss of $6.0 million, or ($0.09) per diluted share, compared to Net income of $7.2 million, or $0.10 per diluted share, in the prior year

  • Adjusted EBITDA of $46.8 million, or 30% of revenue, down $1.7 million, year-over-year

  • Average Monthly Unique Visitors ("UVs") of 23.6 million, up 6% year-over-year

  • Traffic (Visits) of 134.0 million, down 3% year-over-year

  • Monthly Average Revenue Per Dealer ("ARPD") of $2,333, up 3% from $2,264 in the prior year period

  • Dealer Customers of 19,179 as of December 31, 2021, up 150 compared to 19,029 as of September 30, 2021

2021 Full Year Financial and Key Metric Highlights

  • Revenue of $623.7 million, up $76.2 million, or 14% year-over-year. Excluding the impact of the prior year invoice credits1, revenue increased $38 million, or 6%

  • Net income of $7.7 million, or $0.11 per diluted share, compared to a Net loss of $817.1 million, or ($12.15) per diluted share, in the prior year

  • Adjusted EBITDA of $189.2 million, or 30% of revenue, compared to $155.9 million, or 28% of revenue, in the prior year

  • Year-to-Date Net cash provided by operating activities of $138.0 million, flat compared to the prior year, with Free Cash Flow of $118.8 million, compared to $121.9 million in the prior year

  • Average Monthly Unique Visitors of 25.1 million, up 5% year-over-year

  • Traffic of 591.5 million, down 1% year-over-year

  • Dealer Customers of 19,179 as of December 31, 2021, up 807 compared to 18,372 in the prior year

Operational Highlights

  • Recently acquired CreditIQ, a cutting edge automotive fintech platform that provides instant online loan screening and approvals, now rolling out on the Cars.com platform and Dealer Inspire websites

  • Announced agreement to acquire the Accu-Trade Group, a leading vehicle appraisal and acquisition solution, expected to close in the first quarter

  • Announced a $200 million share repurchase program, underscoring the Company's commitment to build shareholder value, while prioritizing continued investments in growth opportunities and maintaining modest leverage

"We achieved double-digit Revenue and Adjusted EBITDA growth this year, by driving continued adoption of our superior digital solutions across the industry," said Alex Vetter, Chief Executive Officer of CARS. "We are leveraging our strong cash flow to acquire technology that advances our platform strategy and enables car buyers and sellers. Our recent acquisitions create incremental revenue streams and expand our TAM into new and growing markets. Our momentum coupled with new product launches position us to deliver strong and sustainable growth in 2022 and beyond."

Q4 2021 Results

Revenue for the fourth quarter totaled $158.3 million, an increase of $5.3 million, or 3%, compared to the prior year period. Dealer revenue grew 8% year-over-year, driven by 4% growth in dealer customers and 3% growth in ARPD, primarily related to continued penetration of FUEL and the Company's other digital solutions. OEM and national revenue was 23% lower compared to the prior period, reflecting lower OEM advertising budgets as inventory shortages persist.

Total operating expenses for the fourth quarter were $154.2 million, compared to $137.1 million for the prior year period. Adjusted Operating Expenses for the quarter were $136.6 million, a $6.3 million increase compared to the prior year period. This increase is primarily due to higher Product and Technology expenses as a result of lower investments in the prior year because of the COVID-19 uncertainty.

Net loss for the quarter was $6.0 million, or ($0.09) per diluted share, compared to Net income of $7.2 million, or $0.10 per diluted share, in the fourth quarter of 2020. The current quarter net loss was primarily a result of $9.6 million of compensation expense recognized as part of the $30 million upfront purchase price of CreditIQ.

Adjusted EBITDA for the quarter was $46.8 million, or 30% of revenue, compared to $48.5 million, or 32% of revenue, for the prior year period.

For the quarter, we delivered double-digit lead growth and 6% growth in Average Monthly Unique Visitors. Total Traffic was 3% lower compared to the fourth quarter of 2020.

Fourth-quarter ARPD was $2,333, up 3% year-over-year, driven by continued growth in FUEL and digital solutions.

Dealer Customers totaled 19,179 at December 31, 2021, up 150 Dealer Customers compared to the end of the third quarter of 2021. This increase was driven by continued strong retention rates and new customer additions. Compared to December 31, 2020, Dealer Customers increased 807, or 4%.

2021 Full-Year Results

Revenue for the year totaled $623.7 million, a 14% increase compared to $547.5 million in 2020, which reflects the impact of the financial relief the Company provided to its dealer customers. Excluding the impact of the financial relief the Company provided to its dealer customers, revenue increased 6% year-over-year.

For the year, total operating expenses were $575.3 million, compared to $1.4 billion, or $528.9 million excluding the 2020 goodwill and intangible asset impairment charge. Adjusted Operating Expenses for the year were $536.3 million, a $31.4 million increase compared to the prior year period. The increase was primarily related to the Company's management of expenses to adjust to changes in revenue due to the COVID-19 pandemic 2020. In 2021, Product and Technology expense increased due to continued investments to support growth, including the Company's replatforming. Marketing and Sales expense also grew as the Company gradually returned to a more typical operating environment.

GAAP net income for 2021 totaled $7.7 million, or $0.11 per diluted share, compared to GAAP net loss of $817.1 million, or ($12.15) per diluted share, in 2020. The 2020 net loss was driven by the goodwill impairment.

Adjusted EBITDA for the year was $189.2 million, or 30% of revenue, compared to $155.9 million, or 28% of revenue, in the prior year period.

Average Monthly Unique Visitors grew 5% and Traffic was 1% lower. Organic traffic remained strong at 70% of Traffic for the full year 2021.

Cash Flow and Balance Sheet

Net cash provided by operating activities in 2021 was $138.0 million, or flat compared to the prior year. Free Cash Flow in 2021 was $118.8 million compared to $121.9 million in 2020.

The Company made $120.0 million in debt repayments during 2021, reducing total debt outstanding to $477.5 million as of December 31, 2021. The Company's total net leverage ratio at year-end improved to 2.3x, compared to 3.4x as of December 31, 2020. Total liquidity was $269.1 million, including cash and cash equivalents of $39.1 million and $230.0 million of revolver capacity, as of December 31, 2021.

"We delivered another quarter of solid Revenue and Adjusted EBITDA growth, in line with expectations, while also generating substantial free cash flow, closing the year in a strong financial position. We're entering 2022 with significant momentum and the financial flexibility to execute on our growth strategy, while reinvesting in the business, paying down debt, and returning capital to shareholders," said Sonia Jain, Chief Financial Officer of CARS.

2022 Outlook

For the first quarter of 2022, the Company expects Revenue of approximately $156.5 million to $158.5 million. Guidance reflects our strong 2021 performance along with the impact of industry-wide inventory shortages on advertising budgets, particularly for OEMs. The Company expects year-over-year revenue growth to accelerate throughout the year with the roll-out of recently announced and acquired solutions and as inventory recovers. Full-year revenue growth is expected to be between 6% to 8%, with double-digit revenue growth in the fourth quarter, assuming inventory shortages have recovered in the second half.

Adjusted EBITDA guidance for the first quarter includes the margin impact of our expected revenue mix as well as higher year-over-year expenses. We expect to invest in the integration and launch of our recent acquisitions and marketing and trade events, and we also expect higher expenses in areas that had been curtailed due to the COVID-19 pandemic. These investments will position the Company for accelerated long-term growth. Adjusted EBITDA margin for the first quarter is expected to be between 26% and 28% and is expected to approach 30% in the fourth quarter as revenue growth accelerates, inventory returns to more normalized levels, and OEM revenue returns to modest growth and also because investments are weighted towards the first half of the year.

Q4 2021 Earnings Call

As previously announced, management will hold a conference call and webcast today at 8:00 a.m. CT. This webcast may be accessed at investor.cars.com. A replay of the webcast will be available at this website following the conclusion of the call until March 10, 2022.

About CARS

CARS is a leading automotive marketplace platform that provides a robust set of industry-specific digital solutions that connect car shoppers with sellers. Launched in 1998 with the flagship marketplace Cars.com and headquartered in Chicago, the Company empowers shoppers with the data, resources and digital tools needed to make informed buying decisions and seamlessly connect with automotive retailers. In a rapidly changing market, CARS enables dealerships and OEMs with innovative technical solutions and data-driven intelligence to better reach and influence ready-to-buy shoppers, increase inventory turn and gain market share.

In addition to Cars.com, CARS brands include Dealer Inspire, a technology provider building solutions that future-proof dealerships with more efficient operations and connected digital experiences; FUEL, which gives dealers and OEMs the opportunity to harness the untapped power of digital video by leveraging Cars.com's pure audience of in-market car shoppers; DealerRater, a leading car dealer review and reputation management platform; and automotive fintech platform CreditIQ.

The full suite of CARS properties includes Cars.com™, Dealer Inspire®, FUEL™, DealerRater®, CreditIQ™, Auto.com™, PickupTrucks.com™ and NewCars.com®. For more information, visit www.Cars.com.

Non-GAAP Financial Measures
This earnings release discusses Adjusted EBITDA, Adjusted EBITDA margin, Free Cash Flow and Adjusted Operating Expenses. These financial measures are not prepared in accordance with generally accepted accounting principles in the United States ("GAAP"). These financial measures are presented as supplemental measures of operating performance because the Company believes they provide meaningful information regarding the Company's performance and provide a basis to compare operating results between periods. In addition, the Company uses Adjusted EBITDA as a measure for determining incentive compensation targets. Adjusted EBITDA also is used as a performance measure under the Company's credit agreement and includes adjustments such as the items defined below and other further adjustments, which are defined in the credit agreement. These non-GAAP financial measures are frequently used by the Company's lenders, securities analysts, investors and other interested parties to evaluate companies in the Company's industry. For a reconciliation of the non-GAAP measures presented in this earnings release to their most directly comparable financial measure prepared in accordance with GAAP, see "Non-GAAP Reconciliations" below.

Other companies may define or calculate these measures differently, limiting their usefulness as comparative measures. Because of these limitations, non-GAAP financial measures should not be considered in isolation or as substitutes for performance measures calculated in accordance with GAAP. Definitions of these non-GAAP financial measures and reconciliations to the most directly comparable GAAP financial measures are presented in the tables below.

The Company defines Adjusted EBITDA as net income (loss) before (1) interest expense, net, (2) income tax (benefit) expense, (3) depreciation, (4) amortization of intangible assets, (5) stock-based compensation expense, (6) unrealized mark-to-market adjustments and cash transactions related to derivative instruments, and (7) certain other items, such as transaction-related costs, severance, transformation and other exit costs and write-off and impairments of goodwill, intangible assets and other long-lived assets.

Transaction-related costs are certain expense items resulting from actual or potential transactions such as business combinations, mergers, acquisitions, dispositions, spin-offs, financing transactions, and other strategic transactions, including, without limitation, (1) transaction-related bonuses and (2) expenses for advisors and representatives such as investment bankers, consultants, attorneys and accounting firms. Transaction-related costs may also include, without limitation, transition and integration costs such as retention bonuses and acquisition-related milestone payments to acquired employees, in addition to consulting, compensation and other incremental costs associated with integration projects.

The Company defines Free Cash Flow as net cash provided by operating activities less capital expenditures, including purchases of property and equipment and capitalization of internal-use software and website development costs.

The Company defines Adjusted Operating Expenses as total operating expenses adjusted to exclude stock-based compensation, write-off and impairments of goodwill, intangible assets, long-lived assets, severance, transformation and other exit costs and transaction-related costs.

Key Metric Definitions

Traffic (Visits). Traffic is fundamental to the Company's business. Traffic to the CARS network of websites and mobile apps provides value to the Company's advertisers in terms of audience, awareness, consideration and conversion. In addition to tracking traffic volume and sources, the Company monitors activity on its properties, allowing the Company to innovate and refine its consumer-facing offerings. Traffic is defined as the number of visits to CARS desktop and mobile properties (responsive sites and mobile apps), measured using Adobe Analytics. Traffic does not include traffic to Dealer Inspire websites. Traffic provides an indication of the Company's consumer reach. Although the Company's consumer reach does not directly result in revenue, the Company believes its ability to reach in-market car shoppers is attractive to its dealer customers and national advertisers.

Average Monthly Unique Visitors ("UVs"). Growth in unique visitors to the Company's network of websites and mobile apps increases the number of impressions, clicks, leads and other events it can monetize to generate revenue. The Company defines UVs in a given month as the number of distinct visitors that engage with its platform during that month. Visitors are identified when a user first visits an individual CARS property on an individual device/browser combination or installs one of its mobile apps on an individual device. If a visitor accesses more than one of the Company's web properties or apps or uses more than one device or browser, each of those unique property/browser/app/device combinations counts toward the number of UVs. UVs do not include Dealer Inspire UVs. The Company measures UVs using Adobe Analytics.

Dealer Customers. Dealer Customers represent dealerships using the Company's products as of the end of each reporting period. Each physical or virtual dealership location is counted separately, whether it is a single-location proprietorship or part of a large, consolidated dealer group. Multi-franchise dealerships at a single location are counted as one dealer.

Average Revenue Per Dealer ("ARPD"). The Company believes that its ability to grow ARPD is an indicator of the value proposition of its platform. The Company defines ARPD as Dealer revenue, excluding digital advertising services, during the period divided by the monthly average number of Dealer Customers during the same period.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the federal securities laws. All statements other than statements of historical facts are forward-looking statements. Forward-looking statements include information concerning the Company's industry, Dealer Customers, results of operations, business strategies, plans and objectives, market potential, outlook, trends, future financial performance, planned operational and product improvements, potential strategic transactions, including the proposed acquisition of Accu-Trade, recent acquisitions, such as CreditIQ, liquidity, including draws from the Company's revolving credit facility, expense management and other matters and involve known and unknown risks that are difficult to predict. As a result, the Company's actual financial results, performance, achievements, strategic actions or prospects may differ materially from those expressed or implied by these forward-looking statements. These statements often include words such as "believe," "expect," "project," "anticipate," "outlook," "intend," "strategy," "plan," "estimate," "target," "seek," "will," "may," "would," "should," "could," "forecasts," "mission," "strive," "more," "goal" or similar expressions. Forward-looking statements are based on the Company's current expectations, beliefs, strategies, estimates, projections and assumptions, based on its experience in the industry as well as the Company's perceptions of historical trends, current conditions, expected future developments, current developments regarding the COVID-19 pandemic and other factors the Company thinks are appropriate. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by the Company and its management based on their knowledge and understanding of the business and industry, are inherently uncertain. These statements are expressed in good faith and the Company believes these judgments are reasonable. However, you should understand that these statements are not guarantees of strategic action, performance or results. The Company's actual results and strategic actions could differ materially from those expressed in the forward-looking statements. Given these uncertainties, forward-looking statements should not be relied on in making investment decisions. Comparisons of results between current and prior periods are not intended to express any future trends, or indications of future performance, unless expressed as such, and should only be viewed as historical data. Whether or not any such forward-looking statement is in fact achieved will depend on future events, some of which are beyond the Company's control.

Forward-looking statements are subject to a number of risks, uncertainties and other important factors, many of which are beyond the Company's control, that could cause its actual results and strategic actions to differ materially from those expressed in the forward-looking statements contained in this press release. For a detailed discussion of many of these and other risks and uncertainties, see the Company's Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q, its Current Reports on Form 8-K and its other filings with the Securities and Exchange Commission, available on the Company's website at investor.cars.com or via EDGAR at www.sec.gov. All forward-looking statements contained in this press release are qualified by these cautionary statements. You should evaluate all forward-looking statements made in this press release in the context of these risks and uncertainties. The forward-looking statements contained in this press release are based only on information currently available to the Company and speak only as of the date of this press release. The Company undertakes no obligation, other than as may be required by law, to update or revise any forward-looking or cautionary statements to reflect changes in assumptions, the occurrence of events, unanticipated or otherwise, or changes in future operating results over time or otherwise.

The forward-looking statements in this report are intended to be subject to the safe harbor protection provided by the federal securities laws.

CARS Investor Relations Contact:
Robbin Moore-Randolph
rmr@cars.com
312.601.5929

CARS Media Contact:
Marita Thomas
mthomas@cars.com
312.601.5692

Cars.com Inc.

Consolidated Statements of Income (Loss)

(In thousands, except per share data)












(Unaudited)







Three Months Ended December 31,


Year Ended December 31,



2021


2020


2021


2020

Revenue:









Dealer


$ 140,778


$ 130,460


$ 549,923


$ 463,018

OEM and National


15,414


20,009


65,085


73,176

Other


2,113


2,539


8,675


11,309

Total revenue


158,305


153,008


623,683


547,503

Operating expenses:









Cost of revenue and operations


29,222


27,160


114,200


101,536

Product and technology


20,990


18,305


77,316


60,664

Marketing and sales


51,867


50,714


208,335


183,448

General and administrative


26,762


15,185


73,562


59,051

Affiliate revenue share





10,970

Depreciation and amortization


25,402


25,747


101,932


113,276

Goodwill and intangible asset impairment





905,885

Total operating expenses


154,243


137,111


575,345


1,434,830

Operating income (loss)


4,062


15,897


48,338


(887,327)

Nonoperating expense:









Interest expense, net


(9,367)


(11,627)


(38,729)


(37,856)

Other expense, net


(144)


(4,239)


(126)


(11,226)

Total nonoperating expense, net


(9,511)


(15,866)


(38,855)


(49,082)

(Loss) income before income taxes


(5,449)


31


9,483


(936,409)

Income tax expense (benefit)


507


(7,188)


1,764


(119,289)

Net (loss) income


$ (5,956)


$ 7,219


$ 7,719


$ (817,120)

Weighted-average common shares outstanding:









Basic


69,176


67,477


68,727


67,241

Diluted


69,176


70,312


71,337


67,241

(Loss) earnings per share:









Basic


$ (0.09)


$ 0.11


$ 0.11


$ (12.15)

Diluted


(0.09)


0.10


0.11


(12.15)

Cars.com Inc.

Consolidated Balance Sheets

(In thousands, except per share data)








December 31,



2021


2020

Assets:





Current assets:





Cash and cash equivalents


$ 39,069


$ 67,719

Accounts receivable, net


98,893


93,649

Prepaid expenses


7,810


6,491

Other current assets


1,665


10,222

Total current assets


147,437


178,081

Property and equipment, net


43,005


41,323

Goodwill


26,227


Intangible assets, net


769,424


835,166

Investments and other assets, net


21,112


21,142

Total assets


$ 1,007,205


$ 1,075,712

Liabilities and stockholders' equity:





Current liabilities:





Accounts payable


$ 15,420


$ 16,512

Accrued compensation


23,612


18,319

Current portion of long-term debt


8,941


7,756

Other accrued liabilities


46,317


47,781

Total current liabilities


94,290


90,368

Noncurrent liabilities:





Long-term debt


457,383


576,143

Deferred tax liability


31,086


30,800

Other noncurrent liabilities


57,512


38,225

Total noncurrent liabilities


545,981


645,168

Total liabilities


640,271


735,536

Commitments and contingencies





Stockholders' equity:





Preferred Stock at par, $0.01 par value; 5,000 shares authorized; no shares
issued and outstanding as of December 31, 2021 and December 31, 2020,
respectively



Common Stock at par, $0.01 par value; 300,000 shares authorized; 69,170 and
67,387 shares issued and outstanding as of December 31, 2021 and
December 31, 2020, respectively


692


674

Additional paid-in capital


1,544,712


1,530,493

Accumulated deficit


(1,176,468)


(1,184,187)

Accumulated other comprehensive loss


(2,002)


(6,804)

Total stockholders' equity


366,934


340,176

Total liabilities and stockholders' equity


$ 1,007,205


$ 1,075,712

Cars.com Inc.

Consolidated Statements of Cash Flows

(In thousands)








Year Ended December 31,



2021


2020

Cash flows from operating activities:





Net income (loss)


$ 7,719


$ (817,120)

Adjustments to reconcile Net income (loss) to Net cash provided by operating activities:





Depreciation


16,290


18,943

Amortization of intangible assets


85,642


94,333

Goodwill and intangible asset impairment



905,885

Impairment of non-marketable security



9,447

Amortization of accumulated other comprehensive loss on interest rate swap


5,670


8,623

Stock-based compensation


21,431


15,155

Deferred income taxes


(2,641)


(103,582)

Provision for doubtful accounts


164


4,380

Amortization of debt issuance costs


3,360


5,108

Other, net


1,416


181

Changes in operating assets and liabilities, net of CIQ Acquisition:





Accounts receivable


(5,352)


3,733

Prepaid expenses and other assets


6,141


(9,514)

Accounts payable


(1,099)


3,993

Accrued compensation


5,293


1,581

Other liabilities


(6,031)


(2,530)

Net cash provided by operating activities


138,003


138,616

Cash flows from investing activities:





Payments for CIQ Acquisition, net of cash acquired


(20,258)


Purchase of property and equipment


(19,192)


(16,712)

Net cash used in investing activities


(39,450)


(16,712)

Cash flows from financing activities:





Proceeds from revolving loan borrowings



565,000

Payments of long-term debt


(120,000)


(615,625)

Stock-based compensation plans, net


(7,194)


235

Payments of debt issuance costs and other fees


(9)


(17,344)

Net cash used in financing activities


(127,203)


(67,734)

Net (decrease) increase in cash and cash equivalents


(28,650)


54,170

Cash and cash equivalents at beginning of period


67,719


13,549

Cash and cash equivalents at end of period


$ 39,069


$ 67,719

Supplemental cash flow information:





Cash (received) paid for income taxes, net of refunds


$ (7,992)


$ 805

Cash paid for interest and interest rate swap


38,342


26,433

Cars.com Inc.

Non-GAAP Reconciliations

(In thousands)

(Unaudited)












Three Months Ended December 31,


Year Ended December 31,



2021


2020


2021


2020

Reconciliation of Net (loss) income to Adjusted EBITDA

















Net (loss) income


$ (5,956)


$ 7,219


$ 7,719


$ (817,120)

Interest expense, net


9,367


11,627


38,729


37,856

Income tax expense (benefit)


507


(7,188)


1,764


(119,289)

Depreciation and amortization


25,402


25,747


101,932


113,276

Goodwill and intangible asset impairment





905,885

Stock-based compensation


5,435


4,974


22,195


15,450

Write-off of long-lived assets and other


499


2,602


1,387


9,700

Severance, transformation and other exit costs


748


1,462


3,528


7,919

Transaction-related costs


10,814


2,029


11,948


2,205

Adjusted EBITDA


$ 46,816


$ 48,472


$ 189,202


$ 155,882



















Reconciliation of Net cash provided by operating activities to Free cash flow














Net cash provided by operating activities


$ 21,777


$ 41,750


$ 138,003


$ 138,616

Purchase of property and equipment


(1,313)


(4,109)


(19,192)


(16,712)

Free cash flow


$ 20,464


$ 37,641


$ 118,811


$ 121,904



















Reconciliation of Operating expenses to Adjusted operating expenses for the Three Months Ended December 31, 2021:












As Reported


Adjustments (1)


Stock-Based
Compensation


As Adjusted

Cost of revenue and operations


$ 29,222


$ —


$ (179)


$ 29,043

Product and technology


20,990



(1,261)


19,729

Marketing and sales


51,867



(1,267)


50,600

General and administrative


26,762


(12,197)


(2,728)


11,837

Affiliate revenue share





Depreciation and amortization


25,402




25,402

Goodwill and intangible asset impairment





Total operating expenses


$ 154,243


$ (12,197)


$ (5,435)


$ 136,611










Total nonoperating expense, net


$ (9,511)


$ (136)


$ —


$ (9,647)










(1) Includes transaction related costs, severance, transformation and other exit costs, and write-off of long-lived assets and other.










Reconciliation of Operating expenses to Adjusted operating expenses for the Three Months Ended December 31, 2020:












As Reported


Adjustments (1)


Stock-Based
Compensation


As Adjusted

Cost of revenue and operations


$ 27,160


$ —


$ (242)


$ 26,918

Product and technology


18,305



(993)


17,312

Marketing and sales


50,714



(1,233)


49,481

General and administrative


15,185


(1,810)


(2,506)


10,869

Affiliate revenue share





Depreciation and amortization


25,747




25,747

Goodwill and intangible asset impairment





Total operating expenses


$ 137,111


$ (1,810)


$ (4,974)


$ 130,327










Total nonoperating expense, net


$ (15,866)


$ 4,283


$ —


$ (11,583)










(1) Includes write-off of long-lived assets and other, transaction-related costs, severance, transformation and other exit costs.










Reconciliation of Operating expenses to Adjusted operating expenses for the Year Ended December 31, 2021:













As Reported


Adjustments (1)


Stock-Based
Compensation


As Adjusted

Cost of revenue and operations


$ 114,200


$ —


$ (909)


$ 113,291

Product and technology


77,316



(5,660)


71,656

Marketing and sales


208,335



(5,402)


202,933

General and administrative


73,562


(16,874)


(10,224)


46,464

Affiliate revenue share





Depreciation and amortization


101,932




101,932

Goodwill and intangible asset impairment





Total operating expenses


$ 575,345


$ (16,874)


$ (22,195)


$ 536,276










Total nonoperating expense, net


$ (38,855)


$ (11)


$ —


$ (38,866)










(1) Includes transaction related costs, severance, transformation and other exit costs, and write-off of long-lived assets and other.










Reconciliation of Operating expenses to Adjusted operating expenses for the Year Ended December 31, 2020:













As Reported


Adjustments (1)


Stock-Based Compensation


As Adjusted

Cost of revenue and operations


$ 101,536


$ —


$ (608)


$ 100,928

Product and technology


60,664



(3,423)


57,241

Marketing and sales


183,448



(3,722)


179,726

General and administrative


59,051


(8,576)


(7,697)


42,778

Affiliate revenue share


10,970




10,970

Depreciation and amortization


113,276




113,276

Goodwill and intangible asset impairment


905,885


(905,885)



Total operating expenses


$ 1,434,830


$ (914,461)


$ (15,450)


$ 504,919










Total nonoperating expense, net


$ (49,082)


$ 11,248


$ —


$ (37,834)










(1) Includes write-off and impairments of goodwill, intangible assets and other long-lived assets and other, severance, transformation and other exit costs, and transaction-related costs.

1 In an effort to assist our dealer customers impacted by the COVID-19 pandemic and related restrictions, we provided, among other measures, financial relief in the form of invoice credits of 50% for April 2020 and 30% for May and June 2020. These discounts totaled approximately $38.2 million in the second quarter of 2020.

Cision
Cision

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SOURCE Cars.com Inc.