TrueCar (TRUE 2.20%) continues to resonate with potential buyers of new cars, and that's paying off with another quarter of record results. TrueCar posted quarterly results after Thursday's market close. Revenue for the lead generator rose 33%, to $58.6 million, as more car buyers turned to TrueCar's haggle-free platform to secure the keys to their desired vehicles.
The market's impressed with the transparency of the TrueCar experience, and that finds more and more showrooms signing up to be part of the TrueCar network that provides bottom-line pricing on new cars and light trucks based on recent transactions. There are now 9,108 franchise dealers honoring TrueCar pricing, 26% ahead from a year ago.
TrueCar leads resulted in the purchase of 168,559 vehicles during the quarter, and that's a 34% pop over the past year. You don't need to whip out a calculator, slide rule, or motor oil dipstick to know what it means when the number of cars being sold are growing faster than the network of dealers: TrueCar is delivering more leads per certified dealer, and that will only draw more dealerships to embrace its lead-generating value proposition. It added more dealers during the first three months of the year -- 609 -- than it has during any quarter in the past.
The news isn't as great as we work our way down the income statement. TrueCar hasn't posted a quarterly profit since going public at $9 last May. It's investing in growth, and ramping up its eventually scalable model. However, it did break even on an adjusted basis. That's in line with Wall Street profit targets, though the $58.6 million it posted on the top line was just short of the $58.8 million that analysts were targeting.
Things should only get better from here. The first quarter is a seasonally sleepy time of the year for showrooms, but things will pick up during the current quarter. TrueCar expects to play a part in 205,000 to 210,000 units being purchased, resulting in revenue clocking in between $67 million and $69 million. The midpoint of that range implies that revenue growth will accelerate to 35%.
TrueCar is sticking to its earlier guidance for all of 2015. It still sees $280 million to $290 million in revenue with adjusted EBITDA between $26.6 million and $29 million.
Naturally, TrueCar will be susceptible to any cyclical slowdown in auto purchases. It is gaining market share, but a thickening slice of a diminishing pie is as fun as driving over a bed of nails in a school speed zone. However, if the economy stays on track and no one disrupts TrueCar's disruptive model, it should continue to be a healthy grower in this climate.