Vehicle listings company TrueCar is considering acquisitions that could boost its digital offerings, executives said Tuesday.
TrueCar CEO Mike Darrow said during the Santa Monica, Calif.-based company’s first-quarter earnings call that “M&A has always been part of the consideration set” when it comes to its capital allocation strategy. He did not disclose specific details about acquisition talks or the types of technology that TrueCar could look to add but said company leaders are “out in the market actively looking” at potential deals.
“For us,” Darrow said, “it’s about smart, tuck-in opportunities with innovative technology and talented know-how and capabilities that accelerate the product road map for TrueCar+ as we look to bring world-class, digital e-commerce capabilities to our dealers and consumers and bring more and more of the car-buying and -selling experience online.”
TrueCar+ is the company’s new digital retailing tool that was introduced in March with dealerships in Florida. It is expected to reach additional U.S. markets this year. The tool allows consumers to choose a vehicle, set up financing, add protection products, arrange delivery and complete a transaction all primarily within TrueCar’s platform.
Darrow and CFO Jantoon Reigersman told analysts on Tuesday’s call that executives believe the company’s cash position — TrueCar reported having roughly $234.8 million in cash and equivalents and no debt on its balance sheet as of March 31 — offers flexibility as the company consider acquisition opportunities. Executives also are working to manage expenses and take a prudent approach amid broader macroeconomic factors constraining the market, they said.
TrueCar on Tuesday reported a wider net loss and lower revenue in the first quarter compared with a year earlier, as the company says its close rates and financial results have been affected by an ongoing shortage of vehicle inventory and higher pricing on available models.