CDK Global, Inc.

Ladies and gentlemen, thank you for standing by, and welcome to CDK Global Q2 2022 earnings conference 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 this session, you will need to press star then 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star then 0. I would now like to turn the conference over to your speaker for today. Ruben Gallegos, you may begin.

Thank you, and good afternoon. I'd like to welcome you to our second quarter fiscal 2022 earnings call. Joining me on today's call are CEO Brian Kruzanich, Chief Operating Officer Joe Taugis, our CFO Eric Guerin, and Mahesh Shah, our Chief Product and Technology Officer. Following their prepared remarks, we'll be taking questions. Our earnings press release was issued after the close of the market today and is posted on our investor relations website at investors.cdkglobal.com, where this call is being simultaneously webcast. In addition, our website includes an updated Excel schedule of supplemental financial information and a copy of our results presentation that we will be referencing during our prepared remarks. Throughout today's call, we will be discussing our continuing operations only, which do not include the international business results, which are presented as discontinued operations. Unless otherwise noted, all references to financial amounts during our call are on a non-GAAP adjusted basis. Reconciliations of adjusted amounts to the most directly comparable GAAP amounts are included in this afternoon's press release. Please also note that all growth percentages refer to the year-over-year change for that period, unless otherwise specified. I would like to remind everyone that remarks made during this call may contain forward-looking statements. These statements involve risks and uncertainties, as further detailed in our findings with the SEC, which could cause actual results to differ materially from those mentioned in the forward-looking statements. And with that, it's my pleasure to turn the call over to VK.

Thanks, Ruben. And thanks to everyone for joining the call today. I hope you have all had a good start to the new year. As we begin the new calendar year and the halfway point for our fiscal year, I'd like to thank our employees, our customers, and partners for their contributions to making Q2 another great quarter for CDK. In the second quarter, CDK continued to execute to our expectations with revenue of $437 million, EBITDA of $168 million, and EPS of $0.74 per share, which is a remarkable result. Our focused investments in strengthening our core products, including significant improvements to our customer service and technology solutions, have distinguished us from the competition and resulted in a 12th consecutive quarter of year-over-year site growth. Before I get into some additional commentary on the industry, I wanted to mention that I'm excited that you'll have the opportunity to hear from Mahesh Shah, our Chief Product and Technology Officer, during today's call. Many of you have asked for additional insight on our product roadmap, engineering acquisition integration, and the R&D investment required to execute our roadmap. I'm excited about our progress in these areas. I thought this would be a great time to have Mahesh provide some comments and take a few questions at the end of the call. I believe there has never been a more exciting time to be in the automotive industry. Several trends are creating new opportunities for CDK to continue to drive innovations that elevate the consumer experience when buying and owning a vehicle. and the most significant trend is the demand by consumers to start the buying process online. However, most people still want to finalize the deal in-store. In order to meet consumer expectations, OEMs and dealers will need to collaborate and provide a seamless experience, one that transitions easily from digital to physical. A great example of this is our collaboration with Hyundai Motor America. The CDK Roadster solution is being used to connect HyundaiUSA.com visitors with its dealer network digital retailing capabilities, leveraging our robust retail APIs from Roadster. Hyundai's new program further streamlines the car buying experience by helping consumers who start their shopping journey at HyundaiUSA.com to instantly discover local dealership pricing, while seamlessly transitioning them to a local dealership for the completion of the purchase, whether online or in-store. Another exciting trend that we are driving innovation around is the connected vehicle. According to Statista, 80% of cars sold in the U.S. are now connected, and by 2025, this will grow to roughly 100%. Yet, in a recent study by CDK, only 58% of shoppers are even aware of connected car technology. This is an area where OEM and dealer collaboration will be essential. Customers are very excited about our work in leveraging artificial intelligence to drive insights at the intersection of connected car data and dealer systems. And OEMs and dealers are increasingly using data to provide customers with experiences that predict when a service is needed, and even proactively schedule the appointment, creating a seamless car-owning experience. Lastly, I would be remiss if I didn't mention the implications of the growing adoption of electric vehicles. First, let's get grounded on the data. While EV is an exciting future, by 2030, research done by a global consulting firm estimates that only 32% of the new car sales will be EV, and EVs will make up less than 10% of the car park. Change is happening, but it's an evolution, and our dealer customers will play a central role. As the EV market scales, traditional OEMs will be the dominant distributor of EVs. Again, based on our research, by 2030, 83% of all EVs will be distributed through the dealer networks of incumbent OEMs. These OEMs see the dealer as a strategic competitive differentiator against the direct-to-consumer EV players and will be using their dealer networks to both assist with sales and provide a superior service experience. Now, in closing, this is an exciting time to be in the automotive industry. The auto market is large and growing, and we believe dealerships will remain the dominant channel for all car sales. CDK is uniquely positioned at the heart of the automotive ecosystem to connect our industry. And through our technology, we unite dealerships, software developers, and OEMs. It's through these connections that we share expertise and facilitate collaboration for the benefit of everyone. So now I'm excited to turn the call over to Mahesh.