Can CAR Group Navigate Global Risks While Expanding Its Automotive Market Lead?
CAR Group Limited has reported robust FY25 financial results with strong revenue and profit growth, underpinned by strategic investments in AI and digital marketplaces. The company projects continued momentum into FY26, aiming to deepen market leadership across global regions.
- FY25 proforma revenue reaches AUD 1.144 billion, up 12% in constant currency
- Adjusted net profit after tax (NPAT) grows 10% to AUD 641 million
- Total shareholder return since 2009 outpaces ASX200 by over fourfold
- FY26 outlook targets 12-14% revenue growth and 9-13% NPAT growth
- Strategic focus on AI-powered tools, digital retailing, and media expansion
Strong Financial Performance Anchors Growth
CAR Group Limited (ASX – CAR) has delivered a compelling set of financial results for the fiscal year 2025, reinforcing its position as a global leader in online vehicle marketplaces. The company reported proforma revenue of AUD 1.144 billion, marking a 12% increase on a constant currency basis compared to the prior year. Adjusted net profit after tax (NPAT) rose 10% to AUD 641 million, reflecting operational efficiencies and robust market demand.
These results come amid a backdrop of evolving consumer behaviours and competitive pressures in automotive retail, yet CAR Group’s diversified portfolio and innovative approach have enabled it to outperform the broader market. Since its ASX listing in 2009, CAR Group has generated a total shareholder return of 1,158%, significantly outpacing the S&P ASX200 index’s 271% return over the same period.
Operational Strength Across Global Markets
The company’s operational metrics underscore its market strength, with 2.3 million vehicles listed online and a unique monthly audience of 49 million users. Dealer engagement remains high, with 49,000 subscribed dealers and 22 million dealer leads delivered in FY25. CAR Group’s revenue streams are well diversified geographically, with 57% generated internationally across North America, Latin America, and Asia, and the remainder from Australia.
Each region contributed to growth through tailored strategies – North America saw resilience in dealer value propositions despite recreational market softness; Latin America benefited from expanded market leadership and innovative loyalty programs; Asia experienced growth driven by premium product sales and AI-enhanced services such as Encar Home delivery.
Strategic Initiatives Fueling Future Growth
Looking ahead to FY26, CAR Group has outlined an ambitious growth plan targeting 12-14% proforma revenue growth and 9-13% adjusted NPAT growth on a constant currency basis. The strategy is anchored on three pillars – strengthening core operations, extending marketplace capabilities, and diversifying growth avenues.
Key initiatives include transforming Autogate into an omnichannel SaaS platform that leverages AI to provide dealers with actionable insights and inventory management tools. In Latin America, the AI-driven “Esquenta Lead” program aims to enhance lead nurturing and conversion rates. Meanwhile, Asia will see enhancements to the Guarantee 2.0 vehicle inspection service and expanded Dealer Direct marketing efforts.
Investment in digital retailing, media product diversification, and data analytics will continue to underpin growth, supported by a prudent leverage ratio of 1.7x and strong cash flow conversion of 98% from EBITDA. These factors position CAR Group to capitalize on evolving automotive retail trends and consumer preferences globally.
Navigating Risks and Market Dynamics
While the outlook is optimistic, CAR Group acknowledges that its financial outcomes depend on macroeconomic conditions, geopolitical risks, inflationary pressures, and foreign exchange fluctuations. The company’s cautious approach to leverage and disciplined capital expenditure reflect an awareness of these uncertainties.
Nevertheless, CAR Group’s commitment to innovation and market expansion suggests it is well placed to sustain its growth trajectory and deliver shareholder value in the coming years.
Bottom Line?
CAR Group’s FY25 results and FY26 ambitions highlight a confident leap into AI-powered automotive marketplaces, but execution amid global uncertainties will be key.
Questions in the middle?
- How will CAR Group’s AI initiatives translate into measurable market share gains?
- What impact will macroeconomic and geopolitical risks have on FY26 growth projections?
- Can CAR Group sustain its leverage and cash flow discipline while investing aggressively in new technologies?
