TrueCar, Inc.

Good day and welcome to the Trucar's second quarter 2022 financial results conference call. Please note this event is being recorded. I would now like to turn the conference over to Ms. Zainab Bakhari, Vice President and Investor Relations. Please go ahead, ma'am.

Thank you, Operator. Hello and welcome to Trucar's second quarter 2022 earnings conference call. Joining me today are Mike Darrow, our President and Chief Executive Officer, and Jan Toon Ridersman, our Chief Financial Officer and Chief Operating Officer. By now, I hope you've all had the opportunity to read our second quarter stockholder letter, which was released on Tuesday, August 2nd, after market closed, and is available on our investor relations website at ir.trucar.com. Before we get started, I want to remind you that we will be making forward-looking statements on this call These forward-looking statements can be identified by the use of words such as believe, expect, plan, target, anticipate, become, seek, will, intend, confident, and similar expressions, and are not and should not be relied upon as a guarantee of future performance or results. Actual results could differ materially from those contemplated by our forward-looking statements. We caution you to review the risk factor section of our annual report on Form 10-K, our quarterly reports on Form 10-Q, and our other reports and filings with the Securities and Exchange Commission for a discussion of the factors that could cause our results to differ materially. The forward-looking statements we make on this call are based on information available to us as of today's date, and we may disclaim any obligation, and we disclaim any obligation to update any forward-looking statements except as required by law. In addition, we will also discuss certain GAAP and non-GAAP financial measures. Reconciliations of all non-GAAP measures to the most directly comparable GAAP measures are set forth in the Investor Relations section of our website at ir.trucar.com. The non-GAAP financial measures are not intended to be considered in isolation or as a substitute for results prepared in accordance with GAAP. With that, I will turn the call over to Trucar's President and Chief Executive Officer, Mike Darrow, for some opening comments. Mike? Mike?

Thanks, Zainab. Good morning, everyone, and thanks for joining us. We issued our Q2 stockholder letter yesterday and highlighted some of the strong progress we've made with the rollout of Trucar Plus in Florida and on the product front for both Trucar Plus and our core used vehicle offering. During Q2, we continued to sign and curate dealers for Trucar Plus and grow the available inventory of new, used, and certified pre-owned vehicles available and continued to see positive momentum in subsequent weeks. While only a small portion of our Florida visitors have been exposed to Trucar Plus to date, early insight from the mid-funnel engagement metrics shows promising trends in June. We'll continue the transactional product buildup for Trucar Plus and increase the exposure for Trucar Plus across more and more of our Florida consumers. The next steps in our near-term roadmap are clear as we plan to enable the delivery of required documents and other capabilities that are necessary to enable dealers and consumers to complete a vehicle transaction through our marketplace. With the recently completed acquisition of Digital Motors, we gain new capabilities and deep expertise in fintech and automotive e-commerce that we believe will help accelerate our roadmap for TrueCar+. acceleration and completion of key product features will be laying the foundation for the expansion of Trucar Plus beyond Florida, which remains on track. In addition to these developments, we continue to enhance our core used vehicle offering with the expansion of distance retailing to Trucar certified dealers across the continental United States, giving dealers who enroll the ability to expand their market reach for their used inventory and offer the convenience of a reliable and professional home delivery to consumers. We also launched the sell your car experience for partners with strong upper funnel and intent metrics as our legacy, better than our legacy trade experience. Dealer inventories, particularly for new cars, remain near historic lows during Q2 while pricing remained elevated. Our recovery in the global supply chain is likely still multiple quarters away in our view, and uncertainty remains high due to geopolitical events and headwinds like a slowing U.S. economy and rising interest rates. Our recent analysis of industry trends led us to estimate July SAR of approximately 13 million, near levels seen in June with industry sales in units estimated decline both on a year-over-year and sequential basis. Industry-wide headwinds continue to put pressure on our close rates, reported units, and other key metrics in Q2, and we continue to expect some volatility in our key metrics throughout 2022. In this environment, we're continuing to manage our business and our resources efficiently. I am very encouraged by our progress during Q2, which was made possible through the hard work and dedication of the entire Trucar crew. So I want to thank them for their commitment to our vision. We are striving to bring something new and unique to the market and doing it at a time of rapid change and enormous macro headwinds. As a company, we remain focused on positioning ourselves for the long term and what we expect will be an increasingly digital future for automotive retail. Before we open up the call for live questions, we're going to address some questions around key topics. Zainab, what's the first question?