ACV Auctions (NASDAQ:ACVA) said it delivered fourth-quarter revenue at the high end of its guidance range and adjusted EBITDA above the high end, citing “solid execution” in its dealer wholesale business despite what management described as challenging market conditions.
Quarterly performance and 2026 outlook
Chief Executive Officer George Chamoun said fourth-quarter revenue was $184 million, up 15% year-over-year, with 193,000 vehicles sold. For the full year 2025, the company reported 19% revenue growth and unit growth of more than 86,000 vehicles, or 12% year-over-year. Chamoun added that adjusted EBITDA more than doubled for the year, which he said demonstrated the company’s ability to scale.
Looking to 2026, management guided for revenue of $845 million to $855 million (11% to 13% growth) and adjusted EBITDA of $73 million to $77 million (about 28% growth). For the first quarter, ACV expects revenue of $200 million to $204 million (9% to 12% growth) and adjusted EBITDA of $14 million to $16 million, implying a 7% to 8% margin.
Revenue mix, ARPU, and cost trends
Zerella said auction and assurance revenue represented 55% of fourth-quarter revenue and grew 11% year-over-year, reflecting 5% unit growth against a difficult comparison. Auction and assurance ARPU was $528, up 6% year-over-year and 4% quarter-over-quarter. Marketplace services revenue was 39% of total revenue and grew 23% year-over-year, which management attributed to continued strength in ACV Transportation and ACV Capital. SaaS and data services were 5% of total revenue, with year-over-year growth accelerating to 8%.
On costs, Zerella said non-GAAP cost of revenue as a percentage of revenue increased about 400 basis points year-over-year, driven primarily by higher arbitration costs “within a specific cohort of customers.” He said ACV’s fourth-quarter guidance assumed elevated arbitration costs would persist in the quarter, but that trends would normalize in 2026 following litigation steps the company implemented—steps he said were already showing positive returns in early 2026. Non-GAAP operating expense (excluding cost of revenue) as a percentage of revenue decreased about 400 basis points year-over-year, reflecting operating leverage.
For 2026, Zerella said ACV expects operating expense growth of about 9%, down from 12% in 2025, including approximately $11 million in additional go-to-market spending tied to regional growth objectives. Even with those investments, the company expects adjusted EBITDA margin to expand by roughly 100 basis points year-over-year.
Dealer marketplace momentum and the “guarantee” channel
Chamoun said ACV’s dealer network expanded in 2025 to 15,000 unique sellers and more than 22,000 unique buyers transacting on the platform. He also said franchise rooftop penetration reached 35% during the year, and the major account team drove a 300-basis-point increase in rooftop penetration.
Management emphasized the use of AI in condition-adjusted pricing guidance, auction scheduling, and buyer recommendations. Chamoun said these investments helped dealers navigate difficult market conditions during the quarter.
A key focus of the call was ACV Guarantee, which Chamoun described as enabling sellers to receive a guarantee while buyers participate in a no-reserve auction experience. He said ACV Guarantee was the company’s fastest-growing channel and that mix increased to 19% in the fourth quarter, with management noting it started the new quarter already “in the 20% range” of total units sold.
In response to questions about conversion, Chamoun said fourth-quarter conversion rates improved year-over-year while “most of our competitors were flat or down.” Zerella later quantified that sell-through in Q4 was up 150 basis points year-over-year. Chamoun also said the company tightened marketplace governance, including removing certain sellers and implementing stricter policies to reduce overpriced vehicles, which he said improved the buyer experience and increased buyer confidence.
Transportation, Capital, and regional expansion investments
In marketplace services, Chamoun said ACV Transportation grew revenue 20% year-over-year in Q4 with 110,000 transports delivered, and that revenue margin reached its midterm target in the low 20s. He also said off-platform transportation is gaining traction with dealer partners.
ACV Capital revenue grew 48% year-over-year in Q4, Chamoun said, despite the company “actively lowering” exposure to higher-risk customer segments. He said new growth strategies and process enhancements were implemented to mitigate portfolio risk.
On geographic performance, Chamoun said ACV continued to grow in established regions and highlighted four regions with strong year-over-year unit growth in Q4. He said the company began increasing its territory manager and “VCI” footprint in certain emerging regions in Q4 and expects those efforts to continue through 2026.
VIPER rollout, commercial wholesale, and capital structure
Management also discussed VIPER, an AI-driven inspection and acquisition solution aimed at helping dealers source consumer vehicles at scale from the service lane. Chamoun said dealer reception at the NADA Industry Conference was “tremendous,” and that ACV is rolling out roughly 5 to 10 VIPER units per month in the early stages. He said the company’s goal is to have more than 100 units in the field this year, potentially “as close as 200,” citing at least 200 dealer “hand raisers.”
Chamoun outlined KPIs for VIPER’s early deployments, including helping dealers buy more vehicles, getting retail photos online faster to speed retail sales, and increasing service revenue, such as through tire-depth prediction. Zerella added that VIPER investments primarily flow through capex because units are capitalized and amortized over a subscription period, and he characterized VIPER capex as “another high single-digit millions,” alongside the $11 million go-to-market investment.
Separately, Chamoun said the company’s commercial wholesale strategy is progressing, with software capabilities supporting its first greenfield remarketing center in Houston and plans to launch an additional greenfield location in Chicago this year.
On liquidity, Zerella said ACV ended Q4 with $270 million in cash and cash equivalents and $190 million of debt, noting the cash balance included $171 million of marketplace float. He also pointed to solid operating cash flow tied to adjusted EBITDA growth and margin expansion.
About ACV Auctions (NASDAQ:ACVA)
ACV Auctions operates a digital marketplace that connects automotive dealers through a mobile-first platform for wholesale vehicle auctions. The company’s software enables dealers to list, inspect and bid on used vehicles in real time, leveraging smartphone-based condition reporting, high-resolution imagery and data analytics to streamline the buying and selling process. ACV Auctions also offers subscription-based access to its auction platform, supplemental reconditioning services and financing tools designed to help dealers optimize inventory turn and reduce risk.
Since its founding in 2014, ACV Auctions has expanded its technology offerings beyond core auction services to include dealer management integrations, transportation logistics coordination and title management solutions.
