What happened
Shares of TrueCar (TRUE -3.78%), a digital automotive marketplace connecting consumers and certified dealers, are up 12% Thursday morning after the company delivered better than expected fourth-quarter financial results.
So what
TrueCar reported a 25% decline in revenue during the fourth quarter, down to $64 million. That result was strong enough to top analysts' estimates of $59 million. The company's fourth-quarter adjusted net loss checked in at $1.1 million, or a loss of $0.01 per share, which was still above analysts' estimates calling for a loss of $0.05 per share.
TrueCar had a 2% increase in average monthly unique visitors during the fourth quarter, and monetization -- which is the average transaction revenue per unit -- jumped to $382 during the fourth quarter, compared to $342 in the prior year.
Image source: Getty Images.
Now what
The fourth-quarter earnings beat and momentum heading into 2021 warrants today's short-term stock price pop, but the company has plenty of work to do on its long-term journey. TrueCar is still struggling with lower unit volume, but it has gained momentum thanks to its new partnership with Navy Federal and its launch of the "Deal Builder" experience. Management is aiming for first-quarter revenue in the range of $60 million to $62 million, and for that to increase sequentially through 2021.
