Wrapping up Q2 earnings, we look at the numbers and key takeaways for the online marketplace stocks, including Instacart (NASDAQ: CART) and its peers.
Marketplaces have existed for centuries. Where once it was a main street in a small town or a mall in the suburbs, sellers benefitted from proximity to one another because they could draw customers by offering convenience and selection. Today, a myriad of online marketplaces fulfill that same role, aggregating large customer bases, which attracts commission-paying sellers, generating flywheel scale effects that feed back into further customer acquisition.
The 14 online marketplace stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 4.7% while next quarter’s revenue guidance was in line.
Luckily, online marketplace stocks have performed well with share prices up 11.4% on average since the latest earnings results.
Instacart (NASDAQ: CART)
Powering more than one billion grocery orders since its founding, Instacart (NASDAQ: CART) is an online grocery shopping and delivery platform that partners with retailers to help customers shop from local stores through its app or website.
Instacart reported revenues of $914 million, up 11.1% year on year. This print exceeded analysts’ expectations by 2%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ EBITDA estimates.
Unsurprisingly, the stock is down 24.2% since reporting and currently trades at $37.50.
Best Q2: Shutterstock (NYSE: SSTK)
Originally featuring a library that included many of founder Jon Oringer’s photos, Shutterstock (NYSE: SSTK) is now a digital platform where customers can license and use hundreds of millions of pieces of content.
Shutterstock reported revenues of $267 million, up 21.3% year on year, outperforming analysts’ expectations by 7.5%. The business had a stunning quarter with an impressive beat of analysts’ EBITDA estimates.
The market seems happy with the results as the stock is up 5.9% since reporting. It currently trades at $20.97.
Is now the time to buy Shutterstock? Access our full analysis of the earnings results here, it’s free.
Weakest Q2: ACV Auctions (NYSE: ACVA)
Founded in 2014, ACV Auctions (NASDAQ: ACVA) is an online auction marketplace for car dealers and wholesalers to buy and sell used cars.
ACV Auctions reported revenues of $193.7 million, up 20.6% year on year, falling short of analysts’ expectations by 1.2%. It was a softer quarter as it posted a significant miss of analysts’ number of marketplace units estimates and EBITDA guidance for next quarter missing analysts’ expectations.
ACV Auctions delivered the weakest performance against analyst estimates and weakest full-year guidance update in the group. The company reported 210,429 units sold, up 12.8% year on year. As expected, the stock is down 23.1% since the results and currently trades at $10.26.
Read our full analysis of ACV Auctions’s results here.
Cars.com (NYSE: CARS)
Originally started as a joint venture between several media companies including The Washington Post and The New York Times, Cars.com (NYSE: CARS) is a digital marketplace that connects new and used car buyers and sellers.
Cars.com reported revenues of $178.7 million, flat year on year. This number was in line with analysts’ expectations. More broadly, it was a mixed quarter as it failed to impress in some other areas of the business.
The company reported 19,412 active buyers, up 0.1% year on year. The stock is down 3.7% since reporting and currently trades at $12.66.
Read our full, actionable report on Cars.com here, it’s free.
eHealth (NASDAQ: EHTH)
Aiming to address a high-stakes and often confusing decision, eHealth (NASDAQ: EHTH) guides consumers through health insurance enrollment and related topics.
eHealth reported revenues of $60.78 million, down 7.7% year on year. This print beat analysts’ expectations by 31%. It was an exceptional quarter as it also logged a solid beat of analysts’ EBITDA estimates and full-year EBITDA guidance exceeding analysts’ expectations.
eHealth scored the biggest analyst estimates beat and highest full-year guidance raise, but had the slowest revenue growth among its peers. The company reported 1.15 million users, down 2.6% year on year. The stock is up 30.1% since reporting and currently trades at $4.24.
Read our full, actionable report on eHealth here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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