A spokesperson from TrueCar declined to comment further at this time, referring to the company’s press release and regulatory filing from last week. As of press time, the CEO, Darrow, has not responded to a message seeking comment.
TrueCar has stated that it will face $7 million in charges, not including stock-based compensation, in the second and third quarters.
The company plans to reduce employment expenses by over $20 million per year, excluding stock-based compensation, through job cuts and a restructuring of its leadership.
As of the end of May, TrueCar had $146.5 million in cash and equivalents. However, the company predicts that its aggregate cash balance could potentially fall below $125 million.
Despite the financial challenges, TrueCar anticipates reaching breakeven or positive adjusted earnings before interest, taxes, depreciation, and amortization in the fourth quarter. They also project double-digit percentage year-over-year revenue growth during that same period.
This year has brought continued financial losses for TrueCar. In the first quarter, the company’s net loss increased to $19.6 million compared to $12.4 million in the same period last year, with a fourth-quarter loss of $18.1 million.
In a conference call discussing the first-quarter earnings, CEO Darrow highlighted several initiatives aimed at reversing the company’s financial decline. These included the launch of TrueCar Wholesale Solutions, a subsidiary focused on providing market-based valuations for used cars, as well as the expansion of the TrueCar+ digital platform and efforts to increase dealership sales conversion rates.
BTIG e-commerce analyst Marvin Fong noted that the restructuring efforts will result in a more streamlined and efficient TrueCar.
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Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
