ACV Auctions Q2 2025 slides: revenue up 21%, margins more than double

ACV Auctions Inc (NASDAQ:ACVA) delivered strong financial results in its second quarter of fiscal year 2025, according to the company’s earnings presentation released on August 11, 2025. The digital automotive marketplace reported significant revenue growth and substantial margin expansion as it continues to execute on its AI-driven growth strategy.

Quarterly Performance Highlights

ACV Auctions reported Q2 2025 revenue of $194 million, representing a 21% year-over-year increase from $161 million in Q2 2024. The company’s marketplace units grew to 210,000, up from 187,000 in the same period last year.

As shown in the following chart comparing key financial metrics between Q2 2024 and Q2 2025:

Profitability metrics showed even more impressive gains, with Adjusted EBITDA reaching $19 million, more than doubling from $7 million in Q2 2024. The Adjusted EBITDA margin expanded significantly to 10%, up from 4% in the prior-year period. Non-GAAP Net Income quadrupled to $12 million from $3 million, with margins expanding from 2% to 6%.

The comprehensive financial performance is illustrated in this detailed comparison:

"We continue to execute on our growth strategy while driving meaningful margin expansion," said George Chamoun, Chief Executive Officer of ACV Auctions, during the earnings presentation. "Our focus on transforming the automotive market with our digitally native, data-driven platform is yielding strong results."

Revenue Diversification and Margin Improvement

ACV’s revenue streams have evolved over the past year, with growth across multiple segments. The company’s revenue mix includes Auction & Assurance, Marketplace Services, and SaaS & Data Services, providing diversification and multiple growth vectors.

The following chart illustrates the evolution of ACV’s revenue composition over the past three years:

Operational efficiency has been a key focus for the company, resulting in significant margin improvements. Non-GAAP Cost of Revenue decreased from 49% to 47% year-over-year, while Non-GAAP Operating Expenses dropped from 50% to 47% of revenue.

These operational improvements are clearly displayed in the following margin analysis:

Bill Zerella, Chief Financial Officer of ACV Auctions, highlighted the company’s balanced approach to growth and profitability: "We’re successfully balancing investments in growth with operational efficiency, resulting in significant margin expansion while still delivering strong top-line growth."

Strategic Initiatives and AI Innovation

ACV continues to invest heavily in artificial intelligence to drive growth and extend its competitive advantage. The company’s AI initiatives span marketplace guidance, enhanced seller experiences, and optimized bidding processes.

The following image showcases how ACV’s AI-driven platform features are contributing to growth:

The company’s AI ecosystem encompasses data capture, real-time valuation and pricing, and guidance on every vehicle, creating a comprehensive technological foundation for its marketplace.

This AI ecosystem is visualized in the following diagram:

Beyond its core marketplace, ACV reported strong growth in complementary services. ACV Transport achieved record revenue with approximately 120,000 transports and 95% lane coverage with AI-optimized pricing. Meanwhile, ACV Capital demonstrated accelerating revenue growth exceeding 60% year-over-year.

The company also highlighted the success of ClearCar and ACV MAX, which are expanding its addressable market by strengthening trade-in funnels and driving retail traffic for dealers.

Financial Position and Outlook

ACV maintains a strong financial position with $305 million in cash, cash equivalents, and marketable securities as of June 30, 2025, though this includes approximately $198 million of marketplace float. The company reported $207 million in ACV Capital receivables and $187 million in long-term debt.

Operating cash flow improved significantly to $80 million for the first half of 2025, compared to $47 million in the same period of 2024, as shown in this capital position summary:

Looking ahead, ACV provided guidance for Q3 2025, projecting revenue between $198 million and $203 million, representing 16-18% year-over-year growth. Adjusted EBITDA is expected to be between $18 million and $20 million, maintaining the 9-10% margin achieved in Q2.

For the full year 2025, the company forecasts revenue of $765 million to $775 million, representing 20-22% growth, with Adjusted EBITDA of $68 million to $72 million, translating to approximately 9% margin.

The detailed guidance is presented in the following chart:

Market Reaction and Conclusion

Despite the strong financial results, ACV’s stock closed down 2.06% on the day of the earnings release at $13.62, though it gained 2.35% in after-market trading, suggesting a mixed initial investor reaction. This contrasts with the more enthusiastic response to the company’s Q1 2025 results, which saw a 9.68% surge in after-market trading.

ACV Auctions continues to demonstrate its ability to grow revenue while significantly improving profitability. The company’s strategic focus on AI-driven innovation, diversified revenue streams, and operational efficiency positions it well for sustainable growth in the digital automotive marketplace.

"We’re executing on our growth strategy, delivering on our product roadmap, expanding our addressable market, driving profitable growth through our scalable business model, and building a world-class team with a people-first culture," concluded Chamoun, summarizing the company’s strategic priorities and accomplishments.

Full presentation:

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