Welcome to the ACV Q1 2026 Earnings Conference Call and Webcast. At this time, all participants are in listen only mode. A question and answer session will follow the formal presentation, and you may be placed in the question queue at any time by pressing star one on your telephone keypad. We ask you please ask one question, one follow-up, then return to the queue. As a reminder, this conference is being recorded. If anyone should require operator assistance, please press star zero. It's now my pleasure to turn the call over to Tim Fox, Vice President, Investor Relations. Tim, please go ahead. Good afternoon, and thank you for joining ACV's conference call to discuss our first quarter 2026 financial results. With me on the call today are George Chamoun, Chief Executive Officer, and Bill Zerella, Chief Financial Officer. Before we get started, please note that today's comments include forward-looking statements, including statements regarding future financial guidance. These forward-looking statements are subject to risks and uncertainties and involve factors that could cause actual results to differ materially from those expressed or implied by such statements. A discussion of the risks and uncertainties related to our business can be found in our SEC filings and in today's press release, both of which can be found on our investor relations website. During this call, we will be discussing both GAAP and non-GAAP financial measures. A reconciliation of GAAP to non-GAAP financial measures is provided in today's earnings materials, which can also be found on our investor relations website. With that, let me turn the call over to George. Thanks, Tim. Good afternoon, everyone, and thank you for joining us. We are very pleased with our first quarter performance and execution while facing a challenging market environment. We delivered record revenue with adjusted EBITDA exceeding the high end of guidance. In addition to strong financial results, we made significant progress in our three key objectives. First, we continue to gain market share and expand our dealer partner network to a new record. The combination of expanding our field capacity and penetration of our no reserve offering contributed to our growth. Second, we had another strong quarter of performance in ACV Transport and ACV Capital, along with growing adoption of our value-added dealer solutions. Third, we're gaining traction with our emerging growth initiatives, including the initial launch of VIPER and expanding our TAM into commercial wholesale. While there are crosscurrents in the broader macro environment, ACV remains focused on delivering double-digit revenue growth and increased adjusted EBITDA while continuing to invest in our exciting growth objectives. We're confident that executing on this profitable growth strategy will create significant long-term shareholder value. With that, let's turn to a recap of our results on slide four. The dealer wholesale market was impacted by severe weather during the quarter, resulting in a mid-single digit decline in dealer wholesale volumes. Despite these headwinds, Q1 revenue was $204 million and grew 12% year-over-year. Even with weather impacts, our market share gains accelerated throughout the quarter, selling 213,000 vehicles, exceeding a difficult comparison in Q1 2025. Today's discussion will focus on the pillars of our strategy to maximize long-term shareholder value, delivering innovation that is driving growth and scale. I will begin with growth. On slide seven, I will highlight our growth initiatives in dealer wholesale. As we discussed last quarter, we continue to drive strong growth within more established regions where network effects are driving significant market share. In order to broaden our regional growth performance, we are investing in additional field capacity to accelerate the number and frequency of dealer visits. We are pleased to see early returns on this investment, which resulted in another record number of buyers and sellers transacting on our marketplace. We also continue to enhance our marketplace experience to drive growth and deliver value to our dealer and commercial partners. We are leveraging machine learning that combines inspection data and dynamic market data to provide real-time pricing. Our platform powers ACV guarantees to sellers and delivers no reserve auctions to buyers. This offering remains the fastest growing channel in our marketplace that benefits sellers, buyers, and ACV. We're removing seller market risk, accelerating bidder engagement, and increasing buyer satisfaction while delivering a 100% conversion rate. We're confident our guarantee offering will continue to be a key driver of market share gains. Turning to slide eight, let's review our marketplace service offerings. The transport team had strong execution in Q1, with 18% revenue growth and over 120,000 transports delivered. By leveraging AI to optimize transport pricing, we continue to drive growth and operating efficiency. Despite the sharp increase in diesel fuel during the quarter, transport revenue margin remained in line with our midterm target in the low 20s. Lastly, on transport, our off-platform service continues to gain traction from our dealer partners, creating additional growth opportunities. ACV Capital also delivered strong revenue performance with 30% year-over-year growth in Q1. Last quarter, we highlighted ACV Capital's expanded go-to-market strategy, while also driving process enhancements to manage portfolio risk. Our Q1 results demonstrate continued strong execution by the ACV Capital team. On slide nine, we highlight how we're further differentiating ACV and creating additional growth opportunities with our suite of AI-driven next-gen products. ClearCar and ACV MAX are adding value to our dealer partners while also contributing to our wholesale market share gains. We are enabling our dealer partners to more intelligently optimize inventory, automate vehicle selling and buying, and strengthen their ability to source more vehicles from consumers. The VIPER Early Access program is gaining momentum and receiving very positive feedback from major dealer groups across the country. Within minutes of driving through VIPER, our industry-leading inspection data and vehicle pricing capabilities enables dealers to unlock consumer vehicle acquisition at scale in the service lanes and seamlessly identifies service upsell opportunities. We are on track to grow VIPER's footprint in the coming quarters, offering a VIPER bundle with wholesale to create a powerful new lever to drive unit growth and expand our network. In addition to leveraging AI across our product suite, we have experienced strong adoption of AI tools across a range of operating groups, including our product and development teams, where we are gaining meaningful velocity and efficiency. As such, we have even more confidence in delivering our differentiated product roadmap to support our growth objectives. Next on slide 10. I'll wrap up the growth section with our commercial wholesale strategy. As a reminder, commercial wholesale is a large adjacent market made up of four segments with both upstream and downstream opportunities. Our team has made significant progress on the next phase of our software build, and we believe this new digital model and end-to-end experience will transform commercial vehicle remarketing. Our differentiated offering is attracting some of the largest commercial consignors, and we have recently engaged with over a dozen accounts across major captives, banks, fleet companies, and auto finance providers. Our strategy is familiar. First land commercial accounts and then expand over time, earning wallet share as we prove our results. Commercial TAM provides another exciting growth lever for ACV, and we are confident that we can deliver wholesale volumes that support our midterm financial targets. With that, I'll hand over to Bill and take you through our financial results and how we're driving growth at scale. Thanks, George, and thank you for joining us today. ACV's first quarter results reinforce our commitment to deliver profitable growth while investing to drive dealer wholesale market share gains and to support key growth initiatives. Before we jump into the details, I'd like to highlight that as we scale our growth initiatives, our financial model will evolve based on revenue mix, which we believe will allow us to deliver improved unit economics over time than previously anticipated. On slide 12, let's begin with a brief recap of our first quarter results. Revenue of $204 million was at the high end of guidance and grew 12% year-over-year compared to very strong results in Q1 2025. Adjusted EBITDA of $17 million exceeded the high end of guidance and grew 23% year-on-year, reflecting strong unit economics and expense discipline. Non-GAAP net income of $7 million was at the high end of our guidance range. Next, on slide 13, let's review additional revenue details. Auction and assurance revenue was 57% of total revenue and grew 9% year-over-year against a tough comparison of 28% growth in Q1 2025. This performance reflects 3% unit growth in the context of a 5% decline in the dealer wholesale market, while also facing a tough comparison of 19% unit growth in Q1 2025. Auction and assurance ARPU of $542 grew 6% year-over-year and 3% quarter-over-quarter. Marketplace services revenue was 39% of total revenue and grew 19% year-over-year, reflecting continued strong performance for ACV Transportation and ACV Capital. Lastly, our SaaS and data services products comprise 4% of total revenue, with growth declining modestly year-over-year. High single-digit ACV MAX revenue growth was offset by modest declines in our legacy standalone inspection services. Next, I'll review Q1 costs on slide 14. Non-GAAP cost of revenue as a percentage of revenue increased approximately 300 basis points year-over-year. The increase was primarily driven by a higher mix of no reserve sales in our marketplace, which more than doubled year-over-year. While no reserve sales typically have modestly higher costs than standalone auction sales, they drive strong blended conversion rates, improved marketplace liquidity, and importantly, are accretive to adjusted EBITDA. In fact, adjusted EBITDA per unit increased 20% year-over-year in Q1. Non-GAAP operating expense, excluding cost of revenue as a percentage of revenue, decreased approximately 300 basis points year-over-year, reflecting operating leverage in our model while continuing to invest in key growth initiatives. Moving to slide 15, I'll frame our investment strategy as we drive profitable growth. In 2026, we expect OpEx growth of approximately 8%, which is a decline from 12% in 2025. As a reminder, our 2026 OpEx includes approximately $11 million in additional go-to-market spending to support regional growth objectives. Even with these growth investments, adjusted EBITDA margin is expected to increase by approximately 100 basis points year-over-year. Next, I will highlight our strong capital structure on slide 16. We ended Q1 with $341 million in cash and cash equivalents and $200 million of debt. Note that our cash balance includes $230 million of marketplace float. In the figure on the right, we highlight our solid operating cash flow, which reflects adjusted EBITDA growth and margin expansion. We're also pleased to announce today that ACV's board of directors has authorized a share repurchase program of up to $100 million. In the coming days, the company plans to enter into an accelerated share repurchase program to repurchase an aggregate of $50 million of our common stock. Turning to guidance on slide 17, we are reaffirming our 2026 revenue and adjusted EBITDA guidance despite the uncertain macroeconomic backdrop and our updated view that the dealer wholesale market will decline in the mid-single digits this year. Now for the details. Second quarter revenue is expected to be $213 million-$217 million, growth of 10%-12%. Adjusted EBITDA is expected to be $18 million-$20 million, reflecting an 8%-9% margin. We continue to expect 2026 revenue of $845 million-$855 million, growth of 11%-13%. Note that full-year revenue guidance assumes that our go-to-market investments are expected to drive modestly higher growth in the second half of the year. We continue to expect 2026 adjusted EBITDA to be $73 million-$77 million, growth of approximately 28% year-over-year. We're expecting 2026 cost of revenue as a percentage of revenue to be modestly higher than in 2025. Lastly, we're expecting non-GAAP OpEx, excluding cost of revenue, to grow approximately 8% year-over-year. With that, let me turn it back to George. Thanks, Bill. Before we take your questions, I will summarize. We are pleased with our Q1 execution while navigating through challenging market conditions. We continue addressing these market challenges by enhancing our technology and operating models, ultimately making us even more resilient. We are attracting new dealer and commercial partners to our marketplace and expanding our addressable market, which positions ACV for attractive growth as market conditions improve. We are delivering on an exciting product roadmap powered by ACV AI to further differentiate ACV and drive operating efficiencies. We are focused on achieving strong adjusted EBITDA growth and delivering on our midterm targets that we believe will drive significant shareholder value. We are committed to achieving these results while building a world-class team to deliver on our goals. With that, I'll turn the call over to the operator to begin the Q&A. Thank you. We'll now be conducting a question and answer session. If you'd like to be placed in the question queue, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. As a reminder, we ask you please ask one question, one follow-up, then return to the queue. If you'd like to remove yourself from the queue, it's star two. Once again, that's star one. Please ask one question, one follow-up, then return to the queue. Our first question is coming from Bob Labick from CJS Securities. Your line is now live. Hi. Good afternoon. Thank you for taking our questions. Hey, Bob. Hey. Part of your growth strategy you've talked about is, you know, filling out your territory managers and VCIs and started, I guess, kind of Q4 of last year are reignited. Maybe talk a little bit about your progress in finding and hiring good candidates, 'cause we noticed that both operations and technology and SG&A grew less than sales in the quarter. You know, I was kind of expecting those lines, depending on where those hires fall. You know, to pick up a little bit. How is that progress going and, you know, what are you learning? What's out there? Yeah, certainly. Well, I'll start, and then Bill will sort of chime in. We're making great progress. We've hired really some exceptional teammates. I joined several of the new territory manager classes. We bring them here to headquarters. I'm really happy with the talent. The talent comes across not only of the auction background, but really knowing dealer systems. You know, these are former GMs, used car managers. Just really strong talent. I've been, you know, really happy with the talent that we've brought in thus far. That's one is on the sales sort of territory manager side. In addition, from an inspector side, we've really stepped up our game where you have to go through several tests to become an ACV inspector. We really go through this gating process. Not only are we getting great talent that's gonna help us not only inspect cars, you know, but also hit our other goals as it relates to making sure arbitration and everything else is in line. We've really done a great job of hiring and training so far. Bill, if you wanna chime in. All I would add, Bob, is, you know, you're also seeing the benefit of some operating efficiencies as well, which flows through our operations costs. We are continuing to add, to George's point, VCIs. We're also making sure that we have the right inspectors in the right territories to ensure that we're, you know, we have the best quality out there as well in terms of our condition reports. I would say we're making good progress. We're pretty happy with how things are moving ahead. Great. Yeah, no, absolutely. Obviously talked about overall market being down, you know, 5% or whatever in single digits in the first quarter and a similar outlook for the year. How does this impact kinda go-to-market strategy and your growth at, you know, finding new rooftops versus, you know, growing share at existing dealers? It's obviously a kind of a tough market. Does that impact, you know, how you go about driving growth? Talk about that a little bit. Yeah, certainly, Bob. I mean, one data point is we had the most dealer visits between our territory managers and VCIs of number of different rooftops last month than we've ever had as a company. That goes to your point of if there are less cars available at certain rooftops, we need to go find another dealership down the road to do business. One, not only did we have record-breaking sellers and buyers, but we also had record number of new visits. Really getting out there, getting the ACV name out there. That would be like step one. I would call that blocking and tackling. Two is really what you hear us doing on this innovation of ACV AI and bringing out our products from ClearCar to VIPER. You'll start to hear more and more in the, in the media about how we're making incredible progress. What that says is dealers are going to know ACV in a whole another way. Because if we help them go buy anywhere between 10 and 100 cars a month from their service drive and from their local consumers, then we're not just a competitor to the local auction. We're really an incredible partner to that dealership. We're both growing, moving forward from, I would say, blocking and tackling and just showing up more and more, giving ourselves the opportunity as we grow our footprint of talented people across the country, but also this differentiated way, leading with ACV AI. Super. Thanks so much. Thank you, Bob. Thank you. Next question is coming from Rajat Gupta from JP Morgan. Your line is now live. Great, thanks for taking the question. You know, I had a question on just the first quarter growth rate. It looks like industry conversion trends were pretty strong in March, also a little better than seasonal, given strong expectations around tax season. In the past, you know, when you've had these, you've tended to demonstrate higher share gains. I'm curious, it felt like, you know, numbers came in in line with what you had guided. I'm curious, you know, was there something that was coming in the way of, you know, those typical share gains that you would see in strong conversion periods? I have a quick follow-up. Yeah, Rajat, as we mentioned on the call, it definitely didn't help that the Northeast, where we have our largest markets, had the most significant weather impact. That didn't help. Now other parts of the country, like for example, Texas and the Carolinas grew 15% year-over-year, and Southern California grew 24% year-over-year. You know, we had different results across the country, depending upon, you know, where weather was impacted. I would give that as a little bit of color of difference. Our team in the Northeast still did a fantastic job, but they were just impacted the most. I would say different things, different results across the country based on factors outside of our control. That'd be number one. I would say, you know, with that, Rajat, you're really starting to see that there's all this other great execution going on. You're starting to see the opportunity for us to differentiate, like I mentioned with Bob's question. I'm feeling really good that we, you know, we really weathered a quarter there where the weather was pretty impacted and still, not only, hit our numbers, but obviously, exceeded our, some of the expectations, so. Yeah. I would add, Rajat, because you were asking about the month of March. Actually our conversion rate in the month of March was 1,000 bips above what it was for Q4, for the entire quarter of Q4. We did see a significant improvement in conversion rates. If you do the, you know, you do some of the simple math in terms of our growth in March, vis-à-vis what the market did, you know, we basically got back to call it, you know, 10% or so. It's not an exact science obviously, but a roughly 10%, you know, share gain when you do that same math, right? We did see some acceleration, you know, going into March, you know, ending the quarter. Understood. That's helpful color. The fact that you reiterated your full year outlook despite just lowering the industry outlook number. So where are you seeing that additional traction? You know, is it something to do with, you know, some of these commercial engagements that you're having? Is it just maybe how like March and like, you know, the exit rate is turning out here on conversion? Just curious if you could unpack that. Thanks. Certainly, Rajat. We're feeling, you know, very comfortable with, you know, keeping our objectives for the year, even though to your point, you know, the market itself is likely several hundred bips probably worse than we were expecting from an overall, you know, market perspective. Why do I feel comfortable? One, us growing the footprint in the field, that's working. Two, this differentiated offering on ACV AI broadly with VIPER and ClearCar and with others, it's working. Three, our commercial focus and the fact that we've got, you know, literally over a dozen different major commercial accounts who've raised their hand and said, "Hey, we'd like to work with ACV," whether it be upstream, pure digital or downstream at one of our greenfields. We feel good about that. We feel good about this year, even though the market conditions are likely gonna be a little bit worse than we originally projected. Understood. Thanks for all the color and good luck. Thank you, Rajat. Thank you. Next question is coming from Andrew Boone from Citizens. Your line is now live. Great. Thank you so much for taking the questions. I'd love to hear a little bit more about what you guys are doing in terms of the VIPER rollout. How are those conversations with dealers going? Then what should our expectations be for 2026? Yeah, certainly. Where we're at is, I would say the hardware, the software, and the AI capabilities all just came together. Over the last few months, we both at ACV and the majority of our initial rollouts to dealers are ecstatic. You'll, you'll see one of these on a podcast next week with a large dealer group where they're just gonna go out there and articulate, you know, how incredible this is helping them in their service drive. You'll, you'll hear a live, a live episode of it next week. This, this up-and-coming opportunity right now is think, okay, hardware works, software works, the AI works. We can see a scratch, we can see a dent, we can see whether or not the tire tread depths are, we can see whether or not there's an oil leak, we can see whether or not the undercarriage has an issue. Our AI can see what it needs to see. The next step is to really we've gotta go out and now scale this. This year won't be the scale year. This year we're only rolling out about 150 of these between now and the end of the year. Think, Andrew, this is very simple. This year, you know, we don't wanna get over our skis too fast. We wanna make sure we can deliver them, install them, support them. We really wanna go into early next year scaling the production of VIPER and really proving out the whole thing. We're feeling really good about it. The other part of this, while we're proving out the hardware scale and production, is these integrations going on. We've got integrations going with these companies that are the back end of dealerships within the service drive. Names maybe you've probably ever heard of, companies like Tekion and others who are the back end service drive sort of software platforms. We're doing those integrations right now so that the data from VIPER seamlessly goes right into the back end systems of the dealership. This year will be really about going out there, getting this ready to really scale for next year. The most important thing, if I'm thinking of as an investor, is the product works, and the feedback we're getting is incredible. Great. That's helpful. Then one of the key trends that we're just hearing across all companies that are talking to us this quarter is just AI efficiency. Can you talk about that both with inspectors and whether there's a step function change in terms of what they can do in the field? Then also internally within corporate, what are you guys seeing there in terms of increased efficiency just given the gains in technology? Thank you, guys. Yeah, certainly. I'll start, then if one of my colleagues wants to chime in on something more specific. Specifically on our inspectors, we're looking at the time to inspect both pre and post having VIPER live. It's sort of two different worlds. Pre VIPER is just really getting the time down, I would say, meaningful. We've got certain inspections right now for certain types of cars. Like I would say a nicer, cleaner car, we're now, we believe, under 10 minutes for a cleaner vehicle. I would say the worst vehicles are also now under 15 minutes, whereas all cars, all vehicles were taking us, I would say, 30 minutes on average prior. We've got two different price buckets of cars now that are about half the time as it used to be, and then kind of the belly, the middle area, we still got a bit more work to do to become more efficient on our time with the cars that have more issues. We're making good progress there and leveraging AI, getting our team to be more efficient. Once VIPER rolls out, I think our inspectors are only gonna spend 10-15 minutes a car, any car. It's just gonna be massively efficient. It's gonna be so much easier. They're basically gonna just check and make sure there's no frame damage, a few other things, you know, launch the car. Next year we could see really unbelievable breakthroughs on having efficiency, but we've got some work to do to make that happen. Internally, from a tech perspective, other efficiencies, as you mentioned, the amount of production I'm seeing from our engineering and product team, leveraging, you know, platforms like Claude and others, it's just incredible. I mean, we've pulled in most of my product and tech teammates are pulling in the Q4 priorities that were put out for this year into Q3. Not all of them yet, I say that 'cause for the ones listening, I can't wait for all of my product and tech teams to pull in, pull in their Q4 into Q3. You know, we're gonna keep seeing that happen. We're gonna start to see, I feel like this is just getting started. The amount of code, the amount of development on a per person basis is just, you know, supercharged over here. With the development of these tools this year, obviously it's been a breakthrough, not just for ACV, but a lot of tech companies, but I couldn't be prouder of what the team is doing. I would also just add that we just signed a major enterprise agreement with one of the largest providers of LLM. That, you know, that approach will not just extend to engineering, but other operational activities. We're kinda in the early days, we're just getting started, but frankly, we think there's huge opportunity, which a lot of companies obviously are kind of seeing the same opportunities as we are. Great. Thank you, guys. Thank you. Thank you. Next question is coming from the Naved Khan from B. Riley Securities. Your line is now live. Great. Thank you very much. Just a couple of questions from me. One is, you know, you, I think you lowered your outlook for the industry to -5% for the full year, and you're reiterating the guidance, your own guidance. I'm just wondering what kind of unit growth are you embedding in that? Are you still thinking about high single unit volume growth? Maybe, you know, as a part of that, we've heard some commentary from others about off-lease volume coming back and such. Even with all of these kind of factors, how do you kind of still think about the -5%? The second question I had is around pricing. Are you contemplating any price increase or have you already rolled out one? What are you seeing out there in respect to similar moves from competitors? Thank you. When you think about the outlook for the year, it's just better to be prudent, you know, with all the, you know, the macro conditions. I think many of you have heard from the dealer, franchise dealerships out there, where they are with retail, as well as with some of the OEMs. Keep in mind that the trade-in at the dealership creates the majority of the wholesale. To your point, as off-lease comes back, could that, you know, benefit and could that mitigate some of the dealer wholesale challenges? It could. I don't wanna bank on that yet. I hope it does. Our thought right now is just to assume the year stays kind of the way it is right now, where we've kind of got these broader macro challenges and just make that assumption. I hope you're right, that off-lease and some of these other things could contribute because it's, to your point, with those cars coming in, the dealer might wholesale more cars. That's really a good point and I hope you're right. We're just not going to plan for it. As it relates to price increases, as you know, we do some minor price increase interest every year. You know, we just make sure we're taking care of, you know, inflation and other costs. We've always kind of got that part of what we do. Bill, any more you want to share? Go ahead. What I would just say is that what you saw in Q1 was our ARPU grew 6% year-on-year. That's a reasonable expectation for the full year. You know, up in a similar fashion on a percentage basis. That's the ARPU side. You also asked a question about unit growth. Obviously, we don't guide as to unit growth. All we've said is that what we expect and what we bake into our guidance is an assumption that over time we will improve our share gains and unit growth versus whatever the market is doing. You know, that's what's baked into our numbers. Hopefully, that gives you some sense as to, in terms of, you know, how to model it. Thank you, Bill. Thank you, George. Yeah. Thank you, Naved. Thank you. The next question is coming from John Healy from Northcoast Research. Your line is now live. Thanks for taking my questions. George, just wanted to ask about the opportunity set with the commercial consignors. I think you mentioned the 12 a couple times in the call. What's the line of sight to activity with those folks yet? Is that something that we could see, you know, before the end of the year? Or is this much more like a 2027 story for you guys? You know, obviously that's a lot of interest. What would be a, you know, an acceptable batting average, do you think, for capturing maybe some of that business in terms of maybe, you know, rooftops or just, you know, hats with those folks? Thanks. Yeah, certainly. Maybe I'll just try to give you a little bit more color. If I separate the upstream versus downstream activity, the upstream being the pure digital where you don't need land. You know, the fact that we've already gone live with one of the top four national rental car companies, and we're going live with our second rental car company, either later this quarter or early Q3, shows that, you know, of the four large rental companies, you know, the fact that we're working with two out of the four, that's a little bit more color on we're definitely starting here. We're starting to make progress. We've got two of the larger fleet companies who have done, I would say, small tests with us, and the small tests have gone extremely well, where they've been able to get results that were just as good or better than any of the physical auctions they work with. We're going, I would say, from test to, I would say, certain regional deployments with them. You know, these are companies who will give us, you know, give us business. I was sincere when I kinda gave the land and expand earlier on the call. First is the land, get the contract done, which is what we're doing with a few of these guys, where we just got the contract done. They'll start to give us some regional business. Keep showing beyond the test they gave us that we can do more, which we will. Then we'll start to show that in certain regions across the country, we've got the best remarketing platform. Then downstream, we've got two auto finance repo-type customers, one that should go live in, like, the next probably 30 to 60 days. They'll start giving us whatever it is. Let's say, you know, 20 to 50 cars, you know, a week or something. Show this thing works, prove that we could not only ground the vehicles, do the light recon. That might mean, for example, put in a battery. When I say light recon, I'm being sincere, very light recon. It allows us to go out there, show it works, then let's start scaling it. Hopefully, I mean, that's a lot of detail to give you. I would say this year is, you know, go out there, get these guys, you know, with contracts, show it works, at least in one region, and then go out there as we get in there and start to take additional regions across the country. That's really helpful. Thank you. Then, Bill, just one follow-up. I think one of the comments you made was that March was like a 10% growth rate. I just wanted to make sure I was hearing that soundbite right because I'm sure folks will focus very much on kind of that exit March data point. Just wanna make sure we understood it. What I was implying was growth versus market. Again, you know, we're kinda in the context of Q1, the market was declining. You know, when we looked at the math in terms of, you know, our absolute unit growth in March versus, you know, what we understood the market did, then we get closer to, you know, quote-unquote, "share gains" that would be in the 10% range, give or take. Right? It's never an exact science, of course, but I don't wanna imply that our growth was actually 10%. It's really, you know, as you know, there's a lot of context given to what our growth rate is vis-a-vis whatever the market is doing. That hopefully gives you more context. Thank you. Thank you. Next question is coming from John Babcock from Barclays. Your line is now live. Hey, good evening. Just quick follow-up on the commercial side of things. You talked about traction with the rental car companies and also on the fleet side of things. Are you making traction with captive fincos and banks as well, or it's really too early to say on that front? We have a few of fleet, yes, I mentioned. You know, fleet would be like corporate cars. You know, we're actually making some progress. On the off-lease cars, we do have a couple OEMs that we're in significant conversation with, where they're discussing giving us a window of selling some of their cars. I don't have those signed. That's why I didn't broadcast it. Usually when I talk about things, it's signed and ready to deploy. I don't wanna jinx us. Then we have another major, like, I'll call it OEM type, where we're now integrated into their flow, but we're not yet auctioning cars. We're getting there. We're starting to, you know, show up and hopefully, more broadly, on the captive side, we'll start to win some business throughout the year. On banks and repos, yeah, I mentioned that earlier. Not only are we doing business with probably somewhere probably around 30-ish% of all the, you know, banks today. I think it's what the team had told me. It's probably larger than 30% at one of the locations from our acquisition. We already, in a way, have some of those relationships, and now it's about scaling that. We inherited some of these relationships, but we now need to bring into, let's say, Houston or Chicago or the next location. Yeah, we know that category, and now it's about scaling it. Okay. Thank you. The next question on the share repurchase side of things. You know, it's not a small amount of repurchases, I was wondering if you could talk about the decision to do shareholder return at this point as opposed to investing back in the business and trying to, you know, maybe push harder on the growth side. Sure, sure. You know, we felt this was a reasonable size for a buyback, and that it's a good ROI for our shareholders based on, you know, our views of kind of our future opportunities. You know, we've talked a lot about a bunch of those today and previously. We just thought it was appropriate based on the amount of liquidity we had. We had $340 million of cash on marketable securities on the balance sheet. We're leaning in pretty hard, obviously, with a $50 million ASR. We think it's a good use of capital. You know, again, we're still expecting to generate free cash flow, you know, this year, and expect that to grow over time. We think it's the right time and place to actually launch on a buyback. Okay. Thank you. Thank you. Next question today is coming from Jeff Lick from Stephens. The line is now live. Good afternoon. Thanks for taking my question. I was wondering if you could maybe expand on John's questions on commercial. Just curious where you're at now in terms of the standalone sites or the greenfield sites. I think you had 10, then you opened a greenfield, and maybe there was another. Also just curious if you could talk about what the wins with the, you know, the commercial consignors. You know, I mean, elaborate which ones are, you know, true digital versus where you're actually using the real estate. Yeah. I think I gave that detail a few minutes ago. I'll just repeat it. I separated a few minutes ago on the upstream versus downstream. When I mentioned we're working with one and now we believe a second rental car company, I was talking about upstream. That was without land. I also mentioned about a couple of the fleet companies we were working with that didn't require land. Some of that c-color that the listeners heard me saying a few minutes ago, that was upstream, just to double down on that. I also talked about a few minutes ago that at our downstream locations, we're working with about 30% of the commercial consignors today at one of our existing locations. To your point, it's about bringing them now to our new locations. We've got one open, one about to open. That's what I just said a few minutes ago, just to repeat it, and we're making great progress. Yes, what you didn't say, as you know, sometimes rental companies, you can do digital, and sometimes they require real estate. That's why I was just curious. On the clarification on how many real estate sites you have, physical sites now. Yeah. More to come on this. Okay. Then, just to follow up on the, on the guarantee, Bill, any color on the penetration of the guarantee? You said it doubled, and I was just curious, the mechanics behind why is a no reserve, the guarantee sale have higher costs? Yeah, I'll start, and Bill can chime in. When you look at the way it works, the business models, we charge a small fee for a customer that goes into the no reserve. There's a fee. We also, there's no fee discounting on the buy side ever because it sells, you know, no reserve in the auction. There's higher ARPU on a no reserve. There's higher cost. It changes the revenue margin%. It was really fascinating. Bill, maybe you can lean in a little bit about our EBITDA profile. We didn't really talk about that at all. Just what's going on overall in our EBITDA profile. Yeah. First, on the call, I mentioned that our EBITDA per unit actually in Q1 was up 20%. You know, the way this works through our model, financially is, you know, slightly lower revenue margins, but that's offset by OpEx leverage. You know, considering the fact that 70% of our OpEx is really fixed, you know, we get full leverage of our inspection costs due to the fact that it's a 100% conversion rate. In fact, you know, when we look at our adjusted EBITDA per unit in our midterm model, that target is $230 of EBITDA. That's at 1.5 million units of volume, right? Significant jump from where we are right now. However, if we just look at two regions that we have in the country, we've either already achieved or exceeded that target. That's without future OpEx leverage. You know, we're feeling pretty good about the ability as we continue to grow our volume, and further populate a lot of these territories, you know, with more scale, that we'll be able to drive really strong EBITDA margins on a per unit basis. That's, or yeah, per unit basis. You know, it all gets down to the final unit economics, right? The geography on the P&L might change a little bit, but it's all about profitability. We're feeling really good about the opportunity to continue to ramp that. Great. Thanks for taking my questions, and best of luck in Q2. Okay. Thanks. Thank you. Next question is coming from Glenn Shell from Raymond James. Your line is now live. Thanks. Congrats on the great quarter. You said VIPERs are enabling a huge breakthrough next year. That sounds great. Is the VCI investment cycle to support VIPER deployment or just more general growth? What should we expect for the future pace of VCI investment as VIPERs reach scale? Yes, great question. Yes, our VCIs are being trained for multiple different ways of helping us scale the business. Really great question. Something I wouldn't have thought to lean in at. One is inspecting vehicles for wholesale. That's you know, obviously their current primary task. Two, I believe I mentioned it on the last call that when there is an arbitration, we used to send the car to, like, a local facility or in some You know, to verify, it would actually cost us money every single time we did that. Now our inspectors are being trained to go out and reinspect a car in case for arbitration. That's actually helping us get that higher customer satisfaction because we're getting to the cars faster, not waiting on a third party. Two, it's helping us really learn a lot and really make sure we got our arbitration under control. That's two. Three, we use our inspectors for auditing ACV Capital, that's another function. To your point on VIPER, our last two installs for VIPER were done with our ACV inspectors. Really proud of that. Nobody from our R&D team had to fly out there from Buffalo. That was a milestone. I know it sounds simple to other investors who've scaled hardware companies, the box arrived, the box arrived in a way where our local inspectors were able to assemble it, put it in and assemble it, and have the whole thing running within a few hours. Literally, here's the internet, get the whole thing going, I was just so proud of our inspection team. Think about we've got an amazing team of colleagues across the country, and what we tell them is, "You're gonna be trained in more than one thing." A lot of them were former mechanics. They're very skilled. They're handy. We're really fortunate to have these great teammates to help us on whatever task they're doing for us that day. Yeah. I would add, in terms of scaling that workforce, what we indicated previously was that we were going to add 100 inspectors to the team this year. We're a little more than halfway there in terms of adding folks. That was more of a one-time upscaling of our team in the field. You know, don't look at this as kind of a need that we have going forward. And that's the $11 million. That plus the adding some territory managers as well and other resources on the go-to-market side. That's what's baked into our guidance this year. Hopefully that helps you model it. I think in terms of going forward, obviously we'll get into next year and the years beyond in terms of what happens to that workforce and scaling as we get closer to 2027. Super helpful. Thanks. Specifically on VIPERs, how many VIPERs are deployed so far, and how many are you installing per month at this point to get to that huge breakthrough next year? How big is the backlog of dealers who are asking for this? We have about 18 live. We have somewhere around 75 that are waiting for them or more. Then we're gonna build, you know, whatever that is, another 60, 70 more. We do have a little bit of a backlog. We are prioritizing, and the way we're doing that is, as dealers are raising their hand, we're trying to give each of the large dealer groups a few of them. Think like major dealer group might get two or three this year, not the five or 10 they're asking for. That's a way to, like, spread the love. But really transparent to those dealers that next year is the scale year and that next year we'll be building, you know, several of these a month, but I'm not ready to tell you just yet. Great question. Sure. Thank you. Yes, sir. Thank you. Next question is coming from Gary Prestopino from Barrington Research. Your line is now live. Hey, good afternoon all. Hey, George, I'm interested. You mentioned something about that you're doing integrations with VIPER into the dealer DMS system. What does the dealer specifically do with that data? I mean, I assume at VIPER, at the point of sale, the service technician, whomever, can see, you know, the value of the car and kinda make a pitch to the owner of the car at that point, "Hey, you know, you can get a good value for this and trade it in and buy something." Maybe I'm wrong with that. Is the dealer taking that data and maybe using it for future leads with their current clients? Yeah. Gary, great question. Yes, as you know, there's companies, like myKaarma, like Tekion, CDK has a service arm and others. These companies, some of them are both a DMS and a service platform, I hate to get into the weeds here. Some, for example, myKaarma, are more focused on the service side, not a broader DMS. Whatever the dealer is using to power their service department. To answer your question specifically, car goes through VIPER, we get this incredible data profile. Every angle of the vehicle, tire treads and, you know, undercarriage and, you know there's other IT we're working on going into next year that I'm not yet talking about. You get this whole profile. You also get the rest of ACV AI, which is predicting the price and condition of that car. You also get the defects we normally see with that vehicle. If it's a Nissan Maxima with 120,000 miles, we know what's typically gonna happen next within the next 10,000 miles. Think not only what is that vehicle, but what are the predictions. As you know, having been around this space, step one was we accomplished that objective. step two, it needs to be put into the dealer system so they can really just make this a scalable process. That's what we're working on next. Proof 1 happened. Now it needs to get in so it can scale. To your point, it's the day of service. Hi, Mrs. Consumer. Hi, Mr. Consumer. Did you know that two of your tires are bald? It's gonna cost you $800. Oh, by the way, it might be time to buy a new car. Whatever they wanna do with that information, it's not only the day of, but what we see is consumers sell their car anywhere at our best performing dealerships. We're seeing, you know, five to some are seven, one of them is nine out of 100 ROs, repair orders. That's incredible because as you know, there's over 250 million cars a year going through franchise dealerships. You just do that simple math of if five out of 100 repair orders could lead to a consumer selling their car, it's massive. It's why you're hearing dealers push us. It's why you're hearing us take that demand going, "We gotta get going over here." Dealers have a hard time scaling this. It takes too many people to do this. By leveraging, you know, this hardware, leveraging our AI, it gets put into the dealership, and then it gets put into the CRM. It's created as a lead. Some dealerships are then putting it with what's called their BDC, and they're using a sales team. Some have actually hired very specific AI-driven bots that do the follow-up for them. We're about to launch that with one of the major dealer groups. Each dealership deployment will be different based on the other vendors involved. Either way, our role at ACV sounds very familiar. What's the condition? What's the price? We're gonna be the one, we're the ACV, we're the actual cash value. Yeah, that's great. It sounds like totally disruptive technology and it's a disruptive product in the market. Yeah. Thank you, Gary. Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over for any further closing comments. Great. Thank you, operator. Everybody, thank you for joining us this evening. We look forward to seeing you on the conference circuit this quarter. Again, thanks for your interest in ACV. Have a great evening. Okay. Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.