Cars.com (NYSE:CARS) Announces Quarterly Earnings Results, Misses Estimates By $0.03 EPS

Cars.com (NYSE:CARS) released its earnings results on Thursday. The company reported $0.45 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $0.48 by ($0.03), Briefing.com reports. Cars.com had a return on equity of 18.12% and a net margin of 3.73%.The firm had revenue of $180.22 million for the quarter, compared to analyst estimates of $180.16 million. During the same period in the previous year, the firm earned $0.37 earnings per share. Cars.com’s revenue was up .7% on a year-over-year basis.

Here are the key takeaways from Cars.com’s conference call:

• Cars.com beat expectations in Q1 with $180.2M revenue (up 1% YoY), adjusted EBITDA margin 28.3% (>1 ppt above guidance), free cash flow up 42% YoY, and raised its 2026 share repurchase target to $90M while repurchasing 3.8M shares YTD.
• Management announced and began implementing a cost reduction program targeting $25M–$30M of recurring annualized operating savings to help grow adjusted EBITDA faster than revenue, with partial savings reflected in Q2 guidance.
• Product and AI initiatives are accelerating — MCP integration with ChatGPT, the Conversational Carson assistant (consumers are >4x more likely to submit a lead after interacting), and a new Dealer app — all intended to build an interconnected, AI-first marketplace and improve dealer ROI.
• OEM and national advertising revenue remains pressured (down about $2M YoY in Q1) as some manufacturers reallocated budgets, and management expects Q2 to be a trough with cautious timing for recovery, adding near-term revenue risk.
• Customer metrics are mixed — Marketplace added dealers (+140 YoY) but overall dealer/solutions and website units declined sequentially and AccuTrade subscribers fell as the company de-emphasizes standalone offerings in favor of bundled packages, creating short-term churn and execution risk.

Cars.com Trading Down 5.2%

Shares of CARS traded down $0.65 during midday trading on Friday, hitting $11.68. The stock had a trading volume of 1,098,516 shares, compared to its average volume of 907,628. The company has a current ratio of 1.87, a quick ratio of 1.87 and a debt-to-equity ratio of 0.98. The firm has a market cap of $679.19 million, a P/E ratio of 27.17 and a beta of 1.64. Cars.com has a fifty-two week low of $7.40 and a fifty-two week high of $13.97. The business has a 50-day simple moving average of $9.23 and a two-hundred day simple moving average of $10.83.

Analyst Ratings Changes

CARS has been the subject of several research reports. Zacks Research upgraded shares of Cars.com from a “strong sell” rating to a “hold” rating in a research report on Wednesday, April 15th. DA Davidson reiterated a “buy” rating and issued a $13.00 target price on shares of Cars.com in a report on Monday, April 13th. B. Riley Financial lowered shares of Cars.com from a “buy” rating to a “neutral” rating and set a $13.00 target price for the company. in a research note on Friday. Barrington Research restated an “outperform” rating and set a $25.00 target price on shares of Cars.com in a report on Friday, February 27th. Finally, UBS Group lifted their price target on shares of Cars.com from $11.00 to $12.00 and gave the stock a “neutral” rating in a research report on Friday. Three research analysts have rated the stock with a Buy rating, four have assigned a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat, Cars.com presently has an average rating of “Hold” and an average target price of $14.67.

Institutional Trading of Cars.com

Several large investors have recently added to or reduced their stakes in the company. Par Capital Management Inc. acquired a new stake in Cars.com during the 2nd quarter valued at $14,220,000. JPMorgan Chase & Co. boosted its position in shares of Cars.com by 112.1% in the fourth quarter. JPMorgan Chase & Co. now owns 1,127,095 shares of the company’s stock worth $13,751,000 after buying an additional 595,609 shares during the period. Bridgeway Capital Management LLC purchased a new position in shares of Cars.com during the second quarter valued at $3,776,000. Arrowstreet Capital Limited Partnership grew its holdings in shares of Cars.com by 23.1% during the third quarter. Arrowstreet Capital Limited Partnership now owns 1,057,322 shares of the company’s stock valued at $12,920,000 after buying an additional 198,077 shares in the last quarter. Finally, Monimus Capital Management LP acquired a new position in Cars.com during the fourth quarter valued at $2,086,000. 89.15% of the stock is owned by institutional investors and hedge funds.

Trending Headlines about Cars.com

Here are the key news stories impacting Cars.com this week:

• Positive Sentiment: Cars.com reaffirmed its 2026 outlook for flat to 2% revenue growth and a 29% to 30% adjusted EBITDA margin, while also boosting its share repurchase target to $90 million, signaling confidence in cash generation and capital return. Article link
• Positive Sentiment: Q1 results showed revenue of $180.2 million, adjusted EBITDA of $51.0 million, and an adjusted EBITDA margin of 28.3%, which exceeded guidance and suggests operating performance remains healthy despite modest top-line growth. Article link
• Positive Sentiment: BTIG Research raised its price target on Cars.com to $14 from $13 and kept a Buy rating, indicating some analysts see further upside from current levels. Article link
• Positive Sentiment: JPMorgan also lifted its price target to $11 from $10, even while maintaining a Neutral rating, reflecting improved valuation expectations after the earnings release. Article link
• Neutral Sentiment: Cars.com reported adjusted results that were largely in line with revenue expectations, but the market is balancing that against the earnings miss and modest growth profile. Article link
• Negative Sentiment: The company posted Q1 EPS of $0.45, missing Wall Street estimates of $0.48, which is the main reason shares have moved lower. Article link

Cars.com Company Profile

Cars.com operates as a leading online automotive marketplace in the United States, connecting car shoppers with new and used vehicle listings from dealerships and private sellers. The platform enables consumers to research makes and models, compare prices, read expert and user reviews, and access tools such as TrueCost to estimate ownership expenses over time. Through its website and mobile applications, Cars.com aims to simplify the car-buying process by aggregating detailed vehicle data, payment calculators, and dealership ratings into a single user-friendly experience.

On the dealer side, Cars.com provides a suite of marketing and lead-generation services designed to help automotive retailers reach potential buyers and manage their online presence.