Autotrader Group Plc

Good morning, everyone, and welcome to Autotrader's results for the six month ending 30th of September 2025. I'm joined by our COO, Catherine, and our CFO, Jamie, who will both be presenting and joining me for Q&A. You will have seen the announcement regarding Catherine moving on to become CEO at Moonpeak. We're very pleased for Catherine and wish her the best as she embarks on the next chapter of her career. Catherine has been a pleasure to work with and has had a real impact at AutoTrader. She will be missed, but she leaves behind a strong team with bench strength that is both broad and deep, so we have little worry that we'll carry on uninterrupted. Our disproportionate focus on internal development over external hiring serves us well at times like this. Catherine is still with us for some time, and we will announce her leaving date in due course once we have worked to a smooth transition plan. Now on to the results. Overall, we are pleased with the progress that we've made through the period. Our profit was marginally ahead of expectations, and we've made significant progress against our strategic priorities. As expected, we've been impacted by the fast speed of sale of vehicles, but the team has delivered well on those areas that are within our control. I'm confident that the actions we are taking today will underpin growth for many years to come. Our market position remains strong, with record levels of buyers and retailers using AutoTrader. As we saw last year, there has been a further increase in the number of unique vehicles advertised on our platform and high levels of engagement with those vehicles. This underpins our core proposition for buyers as we provide full choice and transparency and clearly retailers have benefited from more vehicles moving through a similar number of advertising slots. Our annual product and pricing event in April this year went well, underpinned by the first features under our co-driver AI umbrella. There is significant future potential in this area as we make more AI-powered solutions available and accessible to both retailers and car buyers. We're uniquely placed to do this due to our strong brand, deep integrations with the industry and our real-time proprietary data. The first features of CoDriver have seen strong engagement with over 10,000 retailers already using the tools. It is important to note that AI doesn't just enable us to increase the richness of the car buying experience on AutoTrader, but it does extend the opportunity across all our retailer product areas, which includes advertising, data, digital retailing, and now co-driver. We've also dramatically accelerated the adoption of DealBuilder, growing customers, stock, and deals since our change in approach earlier in the year. DealBuilder will no longer be an optional add-on product available on a selection of cars. It will be the default experience for retailers and car buyers on AutoTrader. Catherine will cover this in more detail later. With a car market that will grow over the long term, a strong market position, we're comfortable that we can continue to grow through delivering meaningful improvements to the buying and retailing of cars in the UK. AutoTrader has never been short of growth opportunities, which remains as true today as it has ever been. I wanted to thank everyone at Autotrader and our customers, shareholders and wider stakeholders for their continued trust and support. We'll start with some of the highlights during the period. Group revenue grew 5%, operating profit grew 6% and basic EPS grew double digit at 11%. Our largest revenue area, retailer revenue, grew at 6%. This was made up of strong forecourt numbers and a 5% increase, in ARPA, mostly driven by the price and product event in April 2025. AI has been a big focus for many investors recently, given its potential to significantly alter consumers' online behaviours. I'll speak to this in more detail later. However, we're confident that on any platform, we're well-placed to provide the best car buying experience for users. The transaction is high-value, complex, and occurs over a three-month period, not one session. The reasons car buyers choose AutoTrader come from our singular focus on the UK, our category-defining brand, well-invested technology and the rich tools we provide both car buyers and retailers, which are all made possible by real-time data at a vehicle level that only we have access to. These unique characteristics are why our market position has been not only maintained but but strengthened when new platforms have emerged, such as Google, iOS, and Android. Now to DealBuilder. I am very proud and pleased with the progress that we've made since we changed our approach midway through the year on DealBuilder. Adoption has dramatically accelerated as we make this journey the default experience on AutoTrader. We've added four times as many retailers this half than we did in the previous six months. We know from years of development and live testing that DealBuilder deepens our engagement in car buying and selling. It delivers better conversion for retailers and a more connected and empowered journey for time poor car buyers who want to do more online when it suits them with a brand they trust. At our full year results in May, we presented this slide for the first time to better show how market dynamics not previously seen before had impacted our financial results. We have four charts here, which I don't intend on going through in great detail, but it is a picture of a more stable market. The key points to note are last year, demand or visits were strong. Supply was constrained. Used car prices had come down. which all resulted in an acceleration in speed of sale. This meant more unique vehicles sold through roughly the same number of slots, which doesn't benefit our business model. This year, however, demand does remain healthy. Supply is gradually coming back and used car prices have been robust, even increasing from the levels seen last year. As a result, speed of sale has not accelerated as it did last year, so the headwinds we were facing have subsided somewhat. However, we would caution too much optimism in the near term, as speed of sale was still one day quicker in October. I'll briefly cover the financial results, which Jamie will cover in more detail next. Group revenue increased by 5%, with core auto trader revenue also increasing by 5%. Group operating profit increased by 6%. Auto trader operating profit increased by 5% to £208 million. And Autorama halved its operating losses to £1.4 million. Non-cash acquisition-related costs were £6.5 million. Group operating profit margin increased to 63% and auto traders operating profit margin remained at 70%. Basic EPS, as mentioned earlier, grew double digit at 11% and cash generated from operations was up 7%. We returned £162.2 million of cash to shareholders through £100.2 million in share buybacks and £62 million in dividends. Finally, we are declaring an interim dividend of 3.8 pence per share. Now onto our operational results. The average number of cross-platform visits was up 1% to 83.3 million per month. And we continue to account for over 75% of all time spent across our main competitor set. The average number of retailer forecourts advertising with us was up 1% to 14,080. Average revenue per retailer was up 5% to 2,994 pounds, mainly due to our product and pricing event implemented on the 1st of April, 2025, which was underpinned by co-driver. Live car stock was up 2% to 457,000, with this increase being due to an offer which ran at the beginning of the six-month period, and we delivered 3,687 new lease vehicles. Finally, the average number of full-time equivalent employees in the group decreased slightly to 1,249. In previous years, we would have covered our cultural KPIs in half-year results. However, we've decided to do this now at each full-year results. The KPIs and initiatives that sit behind them remain as important as they've always been. However, covering them annually better aligns with our annual employee survey. The KPIs on gender, ethnicity and GHG emissions are all included in the press release and the appendix of this presentation. As it relates to culture, it is worth noting that we have entered a new lease and are halfway through investing significant capital in a new home campus for auto trader, which will provide a great environment for our people to do their very best work in a space that facilitates both how we work and the other elements of our culture. I'll now hand over to Jamie to talk us through the financials in more detail.

Thanks, Nathan, and good morning, everyone.

I'll start by focusing on the core auto trader financials. Starting with revenue, total auto trader revenue increased 5% to 296.3 million. Trade revenue increased by 6%, with the largest component of this being retailer revenue, which also grew by 6%. Also within trade revenue, we've seen an increase in both home trader and other trade revenue. Consumer services revenue decreased by 9%. Within this, private revenue generated from individual sellers was down year on year due to a lower number of listings compared to a strong prior year. and motoring services revenue was flat. Revenue from manufacturing agency customers increased 13% year-on-year due to manufacturers supporting their franchise networks on both new and used car advertising. As mentioned, retailer revenue increased 6% year-on-year. The average number of retailer forecourts on our platform increased to 14,080, a 1% year-on-year increase, an average revenue per retailer increased by 5% to £2,994 per month with more detail given on the following slide. Here, the chart on the left shows the components that contribute to the movement in ARPA compared to the prior year. As you can see, ARPA growth was driven by the price and product levers with a small headwind from stock. We delivered our annual pricing event for all customers on 1st April 2025, which included additional products and a like-for-like price increase, which contributed £89 to ARPA growth. Product contributed £64. Most of this growth was from our co-driver product, which was included in retailer advertising packages in April 2025. Prominence, which includes upsell to our higher-level packages, was not a contributor to the product lever in the first half, We continue to review our package staircase and have recently created an offer to incentivize customers onto higher levels, which has had good levels of uptake. This offer converts throughout the second half and will inform how we evolve these packages in H1 of next financial year with the aim of returning prominence to long-term growth. Turning now to stock, you'll see on the right-hand side of the chart that the number of live cars advertised on AutoTrader increased 2% year-on-year. Used car stock also increased by 2%, although much of this was driven by a stock offer which we ran at the beginning of the financial year. Excluding this stock offer and private listings, which do not impact DARPA, the livestock increase was just under 1%. The stock lever was marginally lower due to a slight reduction in underutilized slots which typically occurs when we run this type of offer. Total auto trader costs increased 3% to 90.4 million. Salary costs increased by 6% to 42 million due to higher average salaries and a small increase in the number of auto trader FTEs. Share based payments increased by 1% to 6.9 million. Marketing spend decreased by 21% to 8.9 million due to the timing of campaigns, and we expect a greater level of marketing in the second half of the year. Other costs, which include data services, property-related costs, and other overheads, increased 6% to 22.9 million, primarily due to property costs for our new head office and other IT-related expenses. Depreciation and amortization increased by 31%. Again, related to the cost of our new head office. As a reminder, we fully expense our technology, research and development costs, hence our low levels of CapEx and depreciation. In addition to our investment in cloud-based and AI services, we have around 400 people in product and technology who are continuously improving our platforms and developing new products for consumers and retailers. Operating profit increased by 5% to 208 million during the period, and operating profit margins remained consistent at 70%. Our share of profit generated by dealer auction, the group's joint venture, increased 17% to 2.1 million. Having covered AutoTrader, the main part of the group, we'll briefly cover Autorama results. As a reminder, the Autorama acquisition is part of our strategy to bring attractive new car offers to car buyers on AutoTrader, and to make new cars a more important part of our proposition. Autorama revenue was £21.4 million, with vehicle and accessory sales contributing £16.5 million, and commission and ancillary revenue contributing £4.9 million. Vehicle and accessory revenue relates to vehicles that flow through our balance sheet, which is not our focus for future growth. Total deliveries grew 16% to 3,687 units. As can be seen from the chart, this growth was driven by cars, and importantly, more of that growth was driven by the auto trader platform, which saw a six times increase in delivery volumes. Average commission and ancillary revenue per delivery decreased to £1,329, reflecting the changing vehicle mix during the period. We delivered around 750 vehicles which were temporarily taken on balance sheet, the cost of which was taken through cost of goods sold. This was a year-on-year increase driven by just over 300 extra vans which were taken to support van volumes as they were slightly lower in the third part. Excluding the cost of goods sold, costs of £6.2 million represented a 25% year-on-year reduction with all lines seeing a decrease. The Autorama segment made an operating loss of 1.4 million, which was a significant reduction on last year as a result of the accelerated integration into the main auto trader business and platform. With group revenue up 5% and a reduced Autorama loss, we saw group operating profit increase 6% to 200.1 million and group operating profit margins increase to 63%. As we grow, the strong cash generation of our business leaves us well-placed to return surplus cash to shareholders. Cash generated from operations was at 215.4 million. Now to briefly review net bank debt and capital policy. During the period, the group drew down 15 million of its revolving credit facility and held cash and cash equivalents of 20.2 million. Cash generation operations was largely used to pay tax or return to shareholders through a combination of dividends and share buybacks. The group's long-term capital allocation policy remains unchanged, continuing to invest in the business, enabling it to grow, while returning around one-third of net income to shareholders in the form of dividends. Following these activities, any surplus cash will be used to continue our share buyback programme and to steadily reduce gross indebtedness. That concludes the financials. I'll now hand over to Catherine to talk through progress against our strategic priorities.

Thank you, Jamie, and good morning, everyone. We have made good progress against each of our three strategic focus areas. These areas are closely interconnected. Our platform and our digital retailing capabilities build on the strengths of our marketplace and deepen our relationships with both retailers and car buyers. Our marketplace continues to grow and we have seen a record number of car buyers and retailers using AutoTrader. This means we are also building our unique data advantages through the growth in observations and actions that we capture. Whether it is consumer behavior and interactions or retailer actions and pricing movements, we continue to extend our data lead in this area. We have successfully executed our annual pricing and product event. which included the Co-Driver product, a set of AI-enabled features designed to drive retailer performance and efficiencies in the advertising journey. This product has seen strong engagement from retailers and the features that surface on the Autotrader app and website have been well used by buyers. We continue to scale DealBuilder, enabling consumers to do more of the car buying journey online. At the same time, we are launching the Buying Signals product for retailers, which will provide a greater level of actionable insight to drive their performance. This year, we launched CoDriver, a suite of transformational AI tools that utilise our unparalleled vehicle data and consumer insights to significantly improve the consumer and retailer experience. Our first co-driver suite is available to all retailers and includes smart image management, AI-generated descriptions, and vehicle highlights. As of September, over 10,000 retailers have used co-drivers to create over 1 million high-performing used car and van adverts to optimize over 12 million vehicle images, and we've seen over 85 million buyer interactions with the vehicle highlights on AutoTrader. Whilst Autotrader has been working with and delivering AI products for over 10 years, CoDriver is the first retailer product which has leveraged generative AI. As detailed in our FY 2025 full-year results, at the end of May, we decided to make DealBuilder part of our core proposition to retailers and the consumer experience for car buyers. This will enable us to increase the speed of retailer onboarding, accelerate the level of buyer adoption, materially increase the number of deals being delivered through WaterTrader, and strengthen the competitive moat for our core business. As can be seen on the right-hand side chart, this decision has enabled us to scale the product faster from June onwards than in previous periods. Retailer acquisition during the period was four times greater than the preceding six months. resulting in 4,000 retailers live with the product at the end of September. We also saw a significant increase in the volume of listings with DealBuilder, ending September with 128,000 adverts live. This was over 160,000 live adverts at the end of October, a 25% increase in the month. Consumer engagement has also grown considerably. with 52,000 deals in the period compared to 23,000 in the previous year. The feedback on the product continues to be positive from both retailers and car buyers, with deals converting twice as effectively as a regular auto trader lead and over half of all deals being submitted outside of traditional working hours. We are also launching a new product called Buying Signals, which leverages our unique consumer data to surface both high intent buyers and their preferences to our retailers. Across multiple inquiry types, we have used an AI-powered buyer propensity model to apply a flag for the retailer, indicating how likely the buyer is to buy the vehicle, how local the buyer is, and the type of vehicles that they are interested in. This will enable retailers to prioritise the next best action with different car buyers. The goal of this product is to drive improved conversion for retailers and to close the gap between the journey on AutoTrader and the consumer experience that the retailers forecourt, complementing the deal builder journey. Over time, these buyer propensity models will also inform our own marketing, remarketing and optimisation activities for our products and experiences. I'll now hand back to Nathan to discuss the broader AI trends we are seeing and our outlook for the remainder of the year.

Thank you, Catherine.

The popularity of LLM's chat-style interfaces and agents is at the forefront of investors' minds as it relates to most businesses, and that includes marketplaces. For years now, we've used AI technology in our products and platform, which informs our perspectives on this technology shift. Before we talk about AutoTrader, it is worth saying that we believe top of funnel research and discovery for all products, including cars, will be disrupted by these new interfaces. AI platforms reduce the need to visit multiple websites and summarize what is essentially static content very effectively. Top of funnel content has never been a big focus for us. And when we've experimented with it, the direct benefit to our core was unclear. For this reason, it is not a risk that concerns us as we wholly focus on the point where people want to browse and purchase real available inventory. In terms of AutoTrader then, we have four observations to make. Firstly, the opportunity to use AI to enhance the car buying experience and the tools we provide retailers on AutoTrader is clear and something that we have been doing for a long time now. The recent developments in AI technology, particularly LLMs, provides even greater runway for this across our advertising data, digital retailing, and co-driver product streams, as well as our consumer experience. Secondly, brands really matter. Car buying is an incredibly complex, high-value purchase. It is almost never online only, typically involves multiple transactions, is regulated and usually takes place over three months, during which the selection of vehicles changes constantly. To navigate this, people use AutoTrader. Over 75% of marketplace activity happens on our site and most people come directly to us. 49% from apps, 29% from our URL or searches for AutoTrader, 18% from organic search, with only 4% being paid for web traffic. This brand position doesn't just come from a trademark. It comes from the deep and rich experience we provide car buyers. It's not just about a wide selection of vehicles. It's about making sure that selection is real, available, described to a high quality, easy to navigate, comparable, and not fraudulent. But this is just the listings. People need a lot more than just listings. They need a lot of high-quality real images, comprehensive and accurate descriptions, price flags, dealer ratings, valuations, checks on the vehicle, part exchange quotes, finance, and so on. This is why people seek out AutoTrader, and we believe these tools will continue to be important to a car buying transaction moving forward. Thirdly, As these platforms grow, we will ensure new and existing users of AutoTrader can reach us there. We've taken this high-level approach in similar situations in the past, and it has served us well, whether it was the rise of Google when fears of disintermediation were raised, iOS or Android. In all these cases, our market position strengthened and our audience grew. This is because these platforms grow by providing the best experience to their users. For the reasons mentioned earlier, when it comes to cars in the UK, that is what we do. There will be a myriad of technical, commercial and strategic decisions along the way, including the depth of experience and protection of our data, but these are not new decisions to us. Finally, we are confident that our deep, real-time vehicle data and rich tools for car buyers and retailers will remain essential to what is a large and complex transaction. the vast majority of that data is not available on the public internet. Agents may over time provide users with automated or semi-automated assistance for carrying out varying tasks on the internet, but they too will require sources of high-quality real-time data where they'll face similar constraints to search engines. In fact, most of these interfaces for that sort of data use the search engines we know today. For that reason, We expect that AI agents, like other client technologies, will either remain top of funnel and generalized, or they'll look to provide direct integrations using standard web technologies customized for their environments. Interestingly, this is exactly what ChatGPT recently announced with their app SDK, and we expect others will be soon to follow. These integrations allow greater control over the experience and data that we provide. such that it can bring the best of what LLMs do together with what we do best, providing another way for users to find and engage with AutoTrader. Again, there'll be many decisions to make along the way, but we feel very well-placed to make those. Finally, we know the landscape will evolve, and you can have confidence that we will stay abreast of these changes, we'll continue to be fully engaged in the technology, and will maintain the ability to move both strategically and quickly when required. Now on to the outlook.

Or not.

Right, on the outlook, there is actually not a great deal to say, as those of you who have read the announcement are aware, other than that the first half has pretty much played out as we expected. So our outlook for the remainder of the financial year 2026 remains the same as it was at our full year results. All that for that short sentence. Right, we'll now move to the Q&A, which Jamie will manage, and we'll take questions from analysts in the room.

Yeah, so we'll switch the mic and start down the front and then work our way back as usual.

Hi, thanks. It's Will Packer from P&P Paribas. Three questions, please. Firstly, thank you for the very useful comments on AI and how you're positioning yourselves. Could you help us think through investment requirements in the next 12 to 24 months? Should we interpret your comments as you're well invested and the kind of formula we've seen in recent times of flattish margins or slight expansion depending on the top line is the right formula? That's question one. Secondly, Could you help us think through the dynamics around the integration risks and opportunities with ChatGPT? Am I right in thinking that you have a choice in that you do have a significant inventory lead versus your nearest competitor? Some of the classifiers don't, so you'd think their hand is more forced. You can choose. And in the event that you do decide to integrate, how should we think about the split of economics versus the current status quo? My take would be you're not paying very much to Google compared to some other segments, so is there a risk that the economics deteriorate in that environment? And then finally, you've got a prominence offer. That's something which we haven't heard too much about in the past. Could you help us think through what that means for the upside on prominence and how that will flow through in due course? Thank you.

So I could take the first one. So, you know, as both Nathan and Catherine mentioned, we've been investing in much of this technology for a long period of time, you know, previous product iterations and most recently co-driver. So I think, you know, there's still much work that we can do from both retailer products consumer experiences, tools internally to help us find greater levels of efficiency and productivity. But you're absolutely right. I think we feel like because these investments have been happening for a long period of time, there's no, certainly in that 18 to 24-month window you mentioned, no change from a guidance on margin perspective. Consistent margins in the auto trader segment. I still think we believe at a group level with Autorama, profitability or losses improving and hopefully into profitability that group margins can actually continue to expand.

On the second question around the integration risks and opportunities, I think that there's probably a few things that I'd say. As I said, we think that they'll go for reasonably structured integrations. The idea we've heard and seen some notes about talkers and scraping the internet to get real-time data. We just don't think that's going to happen. I mean, that technology is very, very old and non-performant. And indeed, ChatGPT's SDK suggests that they're going to go for something more structured. What comes with that structure is a pretty great deal of control and transparency about how your data is used, what depth of experience that you provide. So you're able to manage the risks and opportunities. As it turns out, when we've been with Google, We've made decisions to open up our site to a certain level, but not necessarily fully. There'll be those sorts of decisions. When it comes to iOS, we open up everything, but it is within a native app. So when I talked about the strategic, commercial, tactical decisions, they tend to sound very, very technical, but they are quite important. The SDK is not launched in Europe yet, so we haven't had a detailed look at exactly what that looks like. But we would go for something more structured, and we suspect they would as well, because Those platforms, and I think this is where the opportunity is and it relates to your economics point, is Google only became really, really successful because it provided and prioritised the most relevant results for users. That's going to be the true for any interface. So we think we can do that for car buying. We think for that reason they'll want to work with us. If they were to compromise something like that for the sake of some form of rent that they collect, that would seem to be a bit inconsistent with the pattern that has played out with these platforms. But does that mean around an app that we do, there might be paid positions or there will clearly need to be some economics? Yeah, we would expect that to be the case. But again, that is no different to Google. And by and large, most people come I think that is also the point that we're not getting much of our traffic at all about what 18% plus 4% paid. So around 20% of our traffic is coming through those more generalised search engines. Most people are wanting to buy a car kind of know where they need to do that. And I suspect that will still be true in the future. What we hope, though, is as, you know, as more and more users start to use these interfaces, actually the use case for AutoTrader can appeal to people that perhaps might not have otherwise found us, that might have found the search by make and model a little bit intimidating. And, you know, ChatGBT and those other kind of tools can hand off into a structured search like us, which feels like an opportunity we don't necessarily have. Of course, we can do it on our own site, but that is only for people that are coming to auto trade on.

Dominance and offer. So I think we talked at the full year results about how we were doing a lot of work and imagining that in the next year or so, we would look to evolve the package staircase. again typically we've done that every three to four years and we're coming to a time again where we think that is the right thing to do so you're right we are in market with a bigger and more attractive prominence offer than we would typically have run in the past it's had good uptake from retailers and over the coming months we'll be in the process of converting those retailers through to fully paid one of the reasons for making the offer a bit bigger and more attractive is really to learn and to test the value response uplift that we're seeing and the different levels of retailer adoption, all with the view that it will inform the structure and the makeup of the packages that we look to try and then roll retailers into at some point during next financial year.

Thanks very much.

Okay, Gareth. Morning, Gareth Davis from Deutsche Neumis. two from me. The first with a couple of parts on deal builder, 2000 on boards since I think Catherine emphasized June, but just kind of understanding how that's built up. Should we assume it was kind of pretty straight line through that period or, or were there any sort of stumbling blocks initially that you've got through and, and has that ramped into August, September? And then I think you said 25% increase in advert in October and, I mean, can we be as simple as thinking that means we're up to 5,000 by the end of October or is that being too simplistic? And how are you feeling sort of overall in terms of getting everyone you need on DealBuilder by the sort of March-April timeline you need? So that's question one. And then the second one, you confirmed guidance for the year just in terms of the minutiae. Can you talk a little bit on stock and a little bit on dealer forecourts? Because I think stock feels that it's sort of stubbornly set at 28, 29 days. How are you feeling on that at the moment? And then dealer forecourts feels like it's running a bit stronger than I certainly expected. Thank you.

Yeah, sure. So on deal builder, we have been talking on webinars and in the trade press about being around 6,000 retailers. now and about 160,000 or so live adverts, so those numbers are out there. You talked about whether the growth has been linear or not. I think we've talked before about looking, particularly for the independent retailers that work through our portal system, we've been onboarding them in waves, so it's definitely not been a linear line from June through to October. There's been waves of retailers with defined cohort segments that have similar attributes or similar ways of working with us and then have been onboarding them in a more scaled way than we were able to do prior to June. We're getting to the point where we are a good way through all of the independent retailers that work through our portal system. And so growth from this point onwards will be more influenced by the technology API integrations that we're putting in place with the tech partners out there in the automotive industry. We will continue to see, I think, slightly inconsistent patterns of waves when we complete a tech integration with a dealer management system partner. Suddenly, a new cohort of retailers will become addressable and we'll look to get those onboarded pretty quickly. So I imagine it will continue to be quite lumpy between now and March. We're hopeful that we will have made really good progress by March. I imagine, as is typically the case with the integration work that we do, I imagine we will have a tale of retailers that will need to work to get over the line beyond March, driven principally by that tech integration work. Not work on our side, but work for the third parties integrating with that API that they will need to do.

And on the more detailed kind of guidance for stock and forecourts, I mean, I think we've been pleased. You know, the stock has improved through the half. I think at full year results, we gave the April number for the stock lever, which is sort of materially down. And then obviously only marginally down for the first half. we haven't quite got into positive territory. So September was still marginally negative. And I think we are probably a little bit cautious on just what the outlook looks like for these remaining five months or so. The fourth quarter, the first quarter, the calendar year is always slightly volatile. January is generally a very strong sales month and it's not always easy to to source stock. So I think that's why we're holding that guidance at marginally down for the year. Similarly, forecourts almost sort of showing an opposite trend where obviously stocks got better. As you look at the growth rates on forecourts, I think we're pleased that it was as positive as it was in the first half, but the growth rates are trending down. So we've exited the half slightly lower than the 1% greater we delivered in the third half. And, again, you know, I think in the round, holding that guidance of flat four courts seems reasonable.

Thank you. Hi, it's Joe Brightland from UBS. Firstly, a couple on sort of product-driven ARPA into next year. So, firstly, on DealBuilder. You're obviously giving it away for free at the moment. I think you've articulated previously you're then going to sort of do an upsell sort of thing through next year, and that sort of therefore becomes a tailwind for product. So could you talk a little bit about deal builder into 27? You've probably got more formulated views as to how you're going to do that. So any more color you can give us there would be great. Then secondly, on buying signals, which is sort of being rolled out at the moment, and so I think you said you're going to start commercializing that in H2. Any more colour you can give us on sort of the scale of tailwind that that's going to give product in H2 would be great. And then a final one. There's something in the release relating to a property, Autorama property sale. Is that right? Can you give us some colour or what that's about? I presume it's just getting rid of an old Autorama building, but any colour you can give us there would be great. Thank you.

So DealBuilder and buying signals and how and when we'll look to monetize both of them. You will have seen how we've positioned and talked about the product. The two very much come hand in hand. So as part of DealBuilder, we are evolving the value currency that we use to talk to retailers and evolving that to very much be anchored around the deal. And the positioning for buying signals is that you get all of this insight, rich insight about the buyer, their intent to purchase that vehicle, their preferences that they've been looking at and engaging with on our platform. You get all of that rich data as part of a deal. So they have become really how the combination of the two products has become how Autotrader works for retailers. We're looking to monetize certainly the first wave of prices because I think they're both products that have multiple iterations and life cycles for the business as part of the rate event next. year and we have we've been pretty open when asked by retailers in forums and webinars and been talking about that that being the case so first wave of monetization likely to be from April next year for both combined as a package for retailers and that that will be as part of the pricing event it won't be tiered it will be a sort of bundled yes very likely to be part of the overall rate event for all with no tiering

And just to add to that, because you're asking about the second half, whether there's any second half product, you know, the second half product, you know, because I think where consensus is, is slightly higher, is really all coming from prominence and that conversion at the offer is where that kind of product lever grade comes from. So just on the building in Hamilton, I'm delighted someone's made it to the notes in the back of the account. which might be a first for questions for me. So when we acquired Autorama, they owned the building in Hemel Hempstead. You will have noticed from the accounts and the FTEs that we report that as we've kind of integrated into the main auto trader business and platform, the FTE numbers come down. We weren't actively looking to market the building at the time. Opportunistically, someone came and said to an agent that they were looking for property space. and just made sense because, you know, the building is probably bigger than we require. So we've taken a space almost next door that's smaller and fits better for us. It's just on a lease basis and we're obviously then disposing of that effort, which I think is likely to go through in the next couple of weeks.

Thanks.

Yeah, it's Kieran Darling from Citi. Firstly, maybe just on could you give us your thoughts on kind of the pros and cons of the stock-based offering you guys have at the moment? Has there been any internal debate around rather moving to an all-you-can-eat model? It makes a lot of sense, particularly in the context of, I guess, underlying retailers are becoming more technologically efficient and innovative, and therefore maybe that's a headwind permanently. And two, I guess just in terms of open AI and a potential launch of a competitive app. I mean, could you just break down in terms of your visits how much comes through the app versus desktop and just how much of a moat that is for you guys? And then thirdly, I guess just in terms of speed of sale, How should we think about it going into next year in terms of comps as it gets easier? How much of a potential tailwind could that be for you guys?

Thanks. So I think Nathan can manage the second one. So I think we said this at the last set of results. Obviously, the slot-based model where speed of sales has been running quicker has generated this small sort of headwind. And You know, I think we have been doing an exercise and looking at other charging models, and obviously you're fortunate enough to have a number of peers, and everyone seems to have slightly different variations and nuances. All-you-can-eat is always a slightly more challenging one because the nature of retailer customers is you have some customers with four to five cars, and, you know, up to the biggest customer on an individual site will have 4,000. So that... you know, not completely insurmountable, but that makes it a little bit more complex just to run pure all you can eat. But I think we have been doing an exercise at looking at, you know, unique listings and, you know, there are many different kinds of variants that you can do. And so we have been doing that work. I think at the moment, especially as the kind of speed of sale and market headwinds are not as prominent right now as they were this time last year. You know, we still think that, you know, if you get, supply easing up a little bit or speed of sale, you know, selling flat year on year or slightly decelerating, that should be positive with the charging model that we've got. But it's not lost on us that, you know, you don't just want to sit there and say, well, everything will be fine. It'll come back. So we are doing a piece of work. And I think it's not something that we would never consider. I think at this point in time, especially where we are in the sort of cycle, we're reasonably comfortable with the model that we've got.

Kieran, I've got a second bit of your question. The first bit around open AI on competitors, can you just... Sorry, go through that one again.

I think it's a more general point around potential competitors coming in terms of utilising open AI technology.

Yeah, right. No problems at all. So if I take your first question, I think... OpenAI is another window to the Internet that uses, you know, kind of a highly efficient text prediction to kind of summarize answers and give people, you know, the next step that they might want to go to. And, you know, when it was Google, it's all around a page rank algorithm. What we found with Google is that... their desire is to provide high conversion rates to their users to satisfy them, to give them relevance. So Autotrader tends, and over time as SEO and those new releases have gone in, Autotrader has tended to just do better and better and better. And that's not really down to our own SEO activities, although that's clearly part of it. It's because they want to get around people being able to gain those systems to just give users what's the best answer for the task so our biggest protection I think is the fact that you know with that depth of data our brand people look for us but it's not it isn't about the trademark it's actually around what people know that they can can get there and it's all founded on on data so I'd say that's probably our biggest defense is we don't see we don't see a world where we really feel like we'd be threatened in terms of providing the very best car buying experience you've got to believe that people will be willing for some degradation to never ever come to auto trader I think the app Apps have always been a really big strength to us. I think we've always said that most of our traffic, as I laid out, about 80% of it is coming direct to us. The difference between traffic coming direct to our URL and apps is it cannot be intercepted. It is literally a direct connection in. So it is about half of our visits, probably an even bigger percentage of the activity that you see when you go a bit deeper into the funnel looking at And, yeah, it's an area we're always going to invest in. Some people might say we always talked about 10% of our audience coming from marketing, and I mentioned four. The difference is actually marketing with apps. So we do that very actively because it's a different sort of marketing. So, yeah, we think it is a big strength, but at the end of the day, we've just got to be the best place to buy a car, and that's hard to do in the UK because it requires loads and loads of data, and we've got a lot of that, and other people don't.

We have a last question down here, Giles.

Thank you. It's Giles Thorne from Jefferies. First question, I guess, for Catherine. Buying signals, was that always part of the product roadmap for DealBuilder, or was it something that was introduced or accelerated when you changed your commercial approach? Secondly, coming back to this idea of the April 2026 pricing event, how transformational would you describe DealBuilder and buying signals is for your customers, for retailers? And thirdly, maybe back to Nathan, and perhaps you're going to reference again some of your prepared materials. But as you've seen this agentic AI debate suddenly materialize in a very quick and aggressive fashion, which elements of it do you think are most misrepresented, misunderstood? I don't know. You tell me.

I'll take the first one. So on deal-broader and buying signals, buying signals, is built the product was enabled because we've for many years been investing in building a buyer propensity model which takes all of the sales observations data that we get from retailers takes all of the consumer interactions and observations that we see on Autotrader and then looks at how you connect those two sets of observations to know what types of behaviors or patterns do you need to see from the consumer to mean that they're very likely to convert to a sale on a retailer's forecourt. So that model and that logic has been years in the building and creating. So I think definitely buying signals was always a product that we had that we had in mind that we were planning to build and launch. The timing of us testing, piloting, really, really robustly testing that model, the connection with deals, anyone that submitted a deal, any buyer is clearly very likely to be pretty high intent when we talk about levels of intent. So you've immediately got a very identifiable cohort of consumers that you know are going to be very high intent. What buying signals does is then for consumers that might just have submitted an email lead or in time buyers that we might just have seen interacting on our platform, but that haven't left any digital footprint with a retailer, we're able to predict for retailers which of their stock units are more or less likely to sell and how fast they're likely to sell. So step one is the connection to deal builder and delivering up, serving up a level of intent and a greater level of understanding, which we're already seeing from retailers will change like the next best action they then take with that buyer. But in the future, like the evolution of this product should be to enable resellers much more actively to manage their forecourt based on all of the observed leads and deals that they would have been getting in the old world, but also every interaction that's happening on our marketplace and giving them some sense of what that really means for their forecourt. It makes sense, I think, and the timing's right to bring it together as part of DealBuilder and to make it part of that proposition for launch. But in the future, there's lots more we can do with the bioconferencing model and that bias signal thinking and logic to deliver more value to retailers.

On the AI side. I mean, we do use the technology quite a bit, but I'm going to pretend that we're right at the center of OpenAI. We do work very closely with Google and Gemini. I think as it relates, the first thing I would say is that when you speak to, listen to the people that are building this technology, you tend to get quite a balanced view. I personally think, whether it's the founder of OpenAI or one of the founders of OpenAI, They do tend to give a pretty balanced view about this is about token prediction and text prediction. There's not really a semantic understanding of the content that the models are doing, but they work very effectively because they basically say we don't really care how you get to it, but if you can predict an output very accurately, then that's a good thing. It doesn't matter so much how you get to it. I think like two observations of things that I think have been a bit oversimplified is The first I would say in relation to a Gen Tech is that there is quite a big difference between general models and what general models can do and what agents might be able to do. And those agents need to be quite specialised in order to do jobs. And someone needs to do this specialisation. I'll give you a really simple example. We could not use an open model to do something as simple as categorise images and write descriptions on AutoTrader. We had to augment the model, train it ourselves. And that's not even really particularly agentic. That is still a generalized model. But even that task itself, using a general model wouldn't work for it. Now, do we think agents can do lots of stuff for users over time? Yeah, absolutely. But they'll need to be more and more specialized. And the idea of you just being out, these general models are going to solve the whole world's problem. I don't think anyone... really believes that's possible. And the genetic AI itself technically is still, you know, still a bit of a way to go before you see that playing out, although in some fields it is. The second thing I would say is actually all around the real-time aspect of things. The models are trained every six to nine months. Maybe that increases and they do kind of hoover up the internet, all the information it can get to on the internet and use that to create better and better predictions. That is very compute heavy, as we can see, and, you know, NVIDIA share price, suggest is true um what they don't do and don't necessarily need to solve is accessing real-time information because in order to that to do that well what they do there is they partner with search engines chat gbt with bing um google and claude with um sorry gemini and claude with with google and that's because that's a job that has been done well and replicating that um you'll run into exactly the same uh issues there so for real-time data what they do is they use their big model that's very, very intelligent to make better queries of a search engine, then bring it back and summarize it. When it comes to really granular data, like even listings and the data that's on AutoTrader, you probably need a level deeper than that because you can't get that through a traditional search engine. So that is why we think ending up working with one of those platforms and allowing people to access AutoTrader there you know, is probably the way that it will go. But, you know, we can't offer any guarantees around these things. But I think it's very easy to see it as a big blob and extrapolate. But technically, a lot of the engineers will say, well, no, that scenario is just not going to play out. And there are a few examples of it.

I wanted to get the transformational comment. Do you want to do that? Yeah. Are you going to do it bigger than normal?

So if it is in relation to the event. I mean, I think we're, you know, the 1st of April pricing event, it's obviously a very live conversation internally. As Catherine explained, you know, I think we feel like the product set of deal builder in itself and buying signals should be particularly over a longer period of time generate a lot of value for customers um but we still haven't quite landed at what the you know what percentage is we're not going to communicate to customers till january i mean historically or certainly in the last three or four years we've done three to four percent on price two to three percent contribution to the product lever there's nothing here that suggests would be um be outside of those ranges and generally if you say the last three or four events that we've done have been, you know, I think we feel like they've been good ones, then, you know, hopefully this is another good one.

Thank you, Morning.

It's Lara Simpson from JPMorgan. Sorry, I just wanted to come back to stock. I know it's been a big talking point. Firstly, I suppose on the speed of sale, you said it was still one day faster in October. Were you surprised? by that acceleration because it feels like a lot of the forward indicators, it should start to stabilize because we're talking about slower demand, supply coming back, but then the speed of sale keeps disappointing. So were you surprised? And then you've obviously reiterated the guidance, interested on the stock lever guidance. What are your assumptions of speed of sale? Because I feel like in October, we should be getting to easier comps. Are you assuming that speed of sale stabilizes or flows, or the status quo maintains. And then just a quick question on Autorama, actually. A bit of the top line beat was actually from the vehicle and accessory sales, up 20%, I think it was. Has there been any positive surprise there? Because I thought longer term, we should be scaling down that line from a P&L perspective. So just interested on that. And if what you've seen in H1 has changed in your strategy for Autorama, particularly in terms of the top line moving parts and then the profitability of that business. Thank you.

Yeah, I mean, I can take all of them. So, look, I think stock, you know, I mean, it's not the stock lever specifically. So we've guided it to be marginally down for the full year. And, you know, it really is marginally down in the first half. That's implying similar in the second half. I think generally the assumption around speed of sale is, and certainly what was said out of the full year is that when you hit this point, it gets to be more consistent and a day quicker. I think in the round, it does feel more stable generally. So I think we're not expecting speed of tail to accelerate in the second half. That would probably be contrary or a downside to that guidance. Yeah, and I think there still is slightly, if you look more medium term or into next year, I hope and believe that the supply does start to improve as you get better flow of vehicles, better registrations coming out the back of the pandemic. I think we're just being a little bit cautious on whether we're going to see that in this second half or not. And as I mentioned, that fourth quarter is always a slightly unpredictable one. From an Autorama perspective, I think you're absolutely right that the vehicle and accessory sales is not part of the long-term strategy, and we still have a belief that over time that will reduce or disappear. It was really a tactical decision that there were, like I said, we took an extra 300 vans that passed through the balance sheet. They didn't sit there for very long, and just because the van volumes had been slightly lower, we felt that that was a sensible thing to do. The long term strategy is still 100 percent seeing more volume delivered from the auto trader platform for users that are already there. And, you know, we're seeing some positive signs of that, albeit off a low base. But, you know, the auto trader volumes are growing or have grown pretty strongly in this first half. It is. as you'd imagine, heavily skewed towards cars over vans. And so this is some of what you're seeing in the first half is we're wearing a bit of a yield hit from that changing mix, which I think will probably play out a little bit in the second half. But if we continue to grow those volumes, we're still very optimistic in terms of hitting profitability and then hopefully seeing good growth and getting to the 20% to 30% margins that we set out when we acquired the business. It's very much part of, you know, there are a number of products that fit into the new car suite, but it's very much part of that.

Great. Thanks, everyone, for