Before we get started, please note that today's comments include forward-looking statements, including statements regarding future financial guidance. 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. We delivered record revenue with adjusted EBITDA exceeding the high end of guidance. First, we continue to gain market share and expand our dealer partner network to a new record.
The combination of expanding our field capacity and penetration of our no reserve offering contributed to our growth. Second, we had another strong quarter of performance in ACV Transport and ACV Capital, along with growing adoption of our value-added dealer solutions. Third, we're gaining traction with our emerging growth initiatives, including the initial launch of VIPER and expanding our TAM into commercial wholesale. While there are crosscurrents in the broader macro environment, ACV remains focused on delivering double-digit revenue growth and increased adjusted EBITDA while continuing to invest in our exciting growth objectives.
We're confident that executing on this profitable growth strategy will create significant long-term shareholder value. Despite these headwinds, Q1 revenue was $204 million and grew 12% year-over-year. Today's discussion will focus on the pillars of our strategy to maximize long-term shareholder value, delivering innovation that is driving growth and scale. On slide seven, I will highlight our growth initiatives in dealer wholesale.
| Metric | Period | Current guidance |
|---|---|---|
| Revenue | Q2 2026 | $213M-$217M, growth of 10%-12% |
| Adjusted EBITDA | Q2 2026 | $18M-$20M, reflecting an 8%-9% margin |
| Revenue | FY2026 | Reaffirmed $845M-$855M, growth of 11%-13% (H2 growth expected modestly higher on go-to-market investments) |
| Adjusted EBITDA | FY2026 | Reaffirmed $73M-$77M, growth of approximately 28% year-over-year |
| Cost of revenue (% of revenue) | FY2026 | Expected to be modestly higher than in 2025 |
| Non-GAAP OpEx excluding cost of revenue growth | FY2026 | Expected to grow approximately 8% year-over-year (includes ~$11M additional go-to-market spend) |
| Adjusted EBITDA margin | FY2026 | Expected to increase by approximately 100 basis points year-over-year |
| Dealer wholesale market | FY2026 | Now expected to decline in the mid-single digits (updated, several hundred bps worse than prior view) |
| Metric | YoY | Note |
|---|---|---|
| Revenue | +12% to $204M | Record revenue at the high end of guidance against a very strong Q1 2025 comparison, despite weather-driven dealer wholesale volume declines. |
| Adjusted EBITDA | +23% to $17M | Exceeded the high end of guidance on strong unit economics and expense discipline; adjusted EBITDA per unit up 20% year-over-year. |
| Auction and assurance revenue | +9% (57% of total) | 3% unit growth against a roughly 5% dealer wholesale market decline and a tough 28% growth / 19% unit-growth comparison in Q1 2025. |
| Auction and assurance ARPU | +6% to $542 (+3% QoQ) | Pricing actions and mix, including higher ARPU on no reserve sales. |
| Marketplace services revenue | +19% (39% of total) | Continued strong performance for ACV Transportation and ACV Capital. |
| ACV Transportation revenue | +18% | Strong execution with over 120,000 transports delivered and AI-optimized transport pricing; margin held in the low 20s despite higher diesel fuel. |
| ACV Capital revenue | +30% | Continued strong execution on an expanded go-to-market strategy alongside process enhancements to manage portfolio risk. |
| SaaS and data services revenue | Modest decline (4% of total) | High-single-digit ACV MAX growth offset by modest declines in legacy standalone inspection services. |
| Non-GAAP cost of revenue (% of revenue) | +~300 bps | Higher mix of no reserve sales, which carry modestly higher costs and more than doubled year-over-year but are accretive to adjusted EBITDA. |
| Non-GAAP OpEx excluding cost of revenue (% of revenue) | -~300 bps | Operating leverage in the model while continuing to invest in key growth initiatives. |
| Non-GAAP net income | $7M | At the high end of the guidance range. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Field capacity and dealer network expansion | Reignited territory manager / VCI hiring in Q4 | Investing in additional field capacity accelerated dealer visits to a company record last month, producing record buyers, sellers, and new visits; adding ~100 inspectors this year (more than halfway there), a one-time upscaling baked into the ~$11M go-to-market spend. | — |
| No reserve / guarantee offering | Fastest growing channel | More than doubled year-over-year at a 100% conversion rate; drives higher ARPU and modestly higher costs but is accretive to adjusted EBITDA (per-unit EBITDA up 20%) given 70% fixed OpEx and full inspection-cost leverage. | — |
| VIPER (service-lane inspection) rollout | Initial launch | Early Access gaining momentum with ~18 units live and ~75 waiting; ~150 planned this year (60-70 more to build) with 2027 as the scale year; last two installs done by ACV inspectors, and integrations underway with service-drive platforms like Tekion and myKaarma. | — |
| Commercial wholesale expansion | Expanding TAM into commercial wholesale | Engaged over a dozen major accounts across captives, banks, fleets, and auto finance; live with one top-four rental company (a second going live in Q2/early Q3), fleet tests going well, and downstream repo/auto-finance customers going live in the next 30-60 days under a land-and-expand model. | — |
| ACV AI product suite | AI-driven next-gen products (ClearCar, ACV MAX) | ClearCar, ACV MAX and VIPER positioning ACV as a partner (not just a competitor) that helps dealers source 10-100 consumer cars/month from the service drive; inspection times cut to under 10-15 minutes for cleaner/harder cars (versus ~30 minutes prior). | — |
| Internal AI efficiency | — | Strong adoption of AI tools across engineering and product teams (using platforms like Claude), pulling Q4 priorities into Q3; signed a major enterprise agreement with one of the largest LLM providers, extending beyond engineering to other operational activities. | — |
| Capital allocation | — | First-ever buyback: board authorized up to $100M, with a planned $50M accelerated share repurchase, funded from $341M cash (including $230M marketplace float) while still expecting to generate free cash flow this year. | — |
| Midterm unit economics target | — | Midterm model targets $230 of adjusted EBITDA per unit at 1.5 million units; two U.S. regions have already achieved or exceeded that target without future OpEx leverage, and the evolving revenue mix is expected to improve unit economics beyond prior expectations. | — |