ACV Auctions Inc.

Good day and thank you for standing by. Welcome to the ACVA second quarter 2023 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Tim Fox, Vice President of Investor Relations. Please go ahead.

Thank you, Operator. Good afternoon, and thank you for joining ACB's conference call to discuss our second quarter 2023 financial results. With me on the call today are George Shimon, Chief Executive Officer, and Bill Zarella, 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 in 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.

Thanks, Tim. Good afternoon, everyone, and thank you for joining us. We are very pleased with ACV's continued momentum in the second quarter. Another record-breaking quarter in revenue that once again exceeded the high end of guidance, reflecting strong execution by the ACV team as we continued to gain market share. Demand for ACV transport and ACV capital was very strong, which contributed to both revenue growth and revenue margin expansion versus Q2 2022. And our continued focus on driving profitable growth resulted in adjusted EBITDA also exceeding guidance, highlighting the leverage in our model. With that, let's turn to a brief recap of the quarter on slide four. Second quarter revenue of $124 million was $4 million above the high end of guidance, resulting in 8% growth year over year. GMV of $2.5 billion declined 10% year over year, reflecting continued moderation of wholesale market prices. Despite this price moderation, ARPU increased year over year, reflecting our price increase from last fall. We sold 153,000 vehicles on our marketplace, a sequential increase from strong results in Q1, and growth of 3% year over year. Year-over-year unit growth benefited from an increase in conversion rate, which benefited from a range of data-enabled marketplace innovations focused on enhancing dealer engagement. On slide five, I will again frame the rest of today's discussion around the three pillars of our strategy to maximize long-term shareholder value.