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carsome-ebitda-positive

Southeast Asia’s Carsome turns EBITDA positive in 2024

Published on May 13, 2024

carsome-ebitda-positive

Carsome, Southeast Asia’s leading integrated car e-commerce platform, recently disclosed its first quarterly EBITDA-positive result for Q1 2024, continuing its success from December 2023. This achievement highlights the platform’s robust performance and financial prudence, marking its progress as it moves toward sustainable, long-term profitability. Carsome is recognized as the region’s largest used car marketplace in terms of transaction volume and market share.

A significant aspect of this accomplishment is the 48% year-on-year increase in Carsome’s gross profit per unit, driven by vehicle sales and enhanced by the platform’s AI-driven pricing engine that leverages big data for accurate price forecasting.

Enhancements in gross profit, bolstered by strong transaction margins and freshly integrated data analytics, digitalization, and automation, including financing, insurance, and aftersales through Carsome Capital and Carsome Aftersales, have been crucial. This technological integration has improved core operations and ancillary services, boosting ancillary income per unit by over 80% in 2023.

Since its founding in 2015, Carsome has reached a milestone of selling over 500,000 cars, with more than 150,000 vehicles sold last year alone. The platform has also significantly cut customer acquisition costs by 37% through its integrated services, enhancing customer experiences and operational efficiency regionwide.

Carsome Capital, the group’s financial and insurance sector, saw a revenue jump of over 80% in 2023, marking its second consecutive year of net profitability and a threefold increase in profit before tax year-over-year. This success is attributed to its strong origination capabilities and robust in-house underwriting, supported by extensive transactional data.

Eric Cheng, co-founder, chairman, and CEO of Carsome, said, “The profitability milestone is not just a financial metric; it validates our business model and underscores our potential for long-term success. Having achieved profitability, we are poised for sustained growth, capitalizing on the considerable scale of our business in the region. We are strategically expanding our services across the industry value chain, uniquely underpinned by our ownership of transactions—a distinct advantage in Southeast Asia. This is to provide our customers with peace of mind throughout the entire lifecycle of their ownership experience as we ensure end-to-end control of quality of services.”

Carsome Certified, the group’s retail arm, has seen a rise in customer satisfaction from a 77 Net Promoter Score to 83, while its wholesale business scored a 76. The group’s digital monthly active users have also surged to over 18 million, up from 15 million in 2022, propelled by its content and media ecosystem, including iCar Asia and Wapcar brands.

Eric added, “While we are on track to achieve the group’s first full-year profitability this year, we are also continuing our long-term vision of driving profitable growth and extending our leadership in the region and the industry. The untapped potential within our market is immense, and we are just beginning this journey. Our commitment is to lead and innovate within the automotive sector, creating opportunities that anticipate and fulfill the evolving needs of our customers across Southeast Asia.”

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