Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number: 001-40256

ACV Auctions Inc.

(Exact Name of Registrant as Specified in its Charter)


Delaware			47-2415221
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
640 Ellicott Street, #321 Buffalo, New York			14203
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: 800 553-4070

_________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Class A common stock, par value $0.001 per share

ACVA

Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of October 31, 2024, there were 158,276,243 shares of the registrant's Class A common stock, and 9,363,720 shares of Class B common stock, each with a par value of $0.001, outstanding.

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		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)
	Condensed Consolidated Statements of Operations	3
	Condensed Consolidated Statements of Comprehensive Loss	4
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Changes in Stockholders’ Equity	6
	Condensed Consolidated Statements of Cash Flows	8
	Notes to Unaudited Condensed Consolidated Financial Statements	9
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4.	Controls and Procedures	40

PART II.	OTHER INFORMATION	41
Item 1.	Legal Proceedings	41
Item 1A.	Risk Factors	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 3.	Defaults Upon Senior Securities	41
Item 4.	Mine Safety Disclosures	41
Item 5.	Other Information	41
Item 6.	Exhibits	43
Signatures		45

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, about us and our industry that involve substantial risks and uncertainties. All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q including statements regarding our future results of operations or financial condition, business strategy and plans and objectives of management for future operations, are forward-looking statements. In some cases, you can identify forward-looking statements because they contain words such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will” or “would” or the negative of these words or other similar terms or expressions. These forward-looking statements include, but are not limited to, statements concerning the following:

•our expectations regarding our revenue, operating expenses and other operating results, including our key metrics and our ability to meet previously announced earnings guidance;

•our ability to effectively manage our growth and expand our business, including providing additional channels for auction services for dealers and commercial partners;

•our ability to grow the number of marketplace participants on our platform;

•our ability to acquire new customers and successfully retain existing customers and capture a greater share of wholesale transactions from our existing customers;

•our ability to increase usage of our platform and generate revenue from our value-added services;

•anticipated trends, growth rates, and challenges in our business and in the markets in which we operate;

•our ability to achieve or sustain our profitability;

•future investments in our business, our anticipated capital expenditures and our estimates regarding our capital requirements;

•the costs and success of our marketing efforts, and our ability to promote our brand;

•the effects of macroeconomic conditions on our business;

•our reliance on key personnel and our ability to identify, recruit and retain skilled personnel, especially as we establish new offerings;

•our ability to compete effectively with existing competitors and new market entrants;

•our ability to obtain, maintain, protect and enforce our intellectual property rights and any costs associated therewith;

•our ability to predict, prepare and respond to new kinds of technology innovations, such as artificial intelligence, as well as market developments and changing customer needs;

•our ability to expand internationally;

•our ability to identify and complete acquisitions that complement and expand our reach and platform;

•our decision to not declare or pay dividends for the foreseeable future;

•our ability to comply or remain in compliance with laws and regulations that currently apply or become applicable to our business in the United States and other jurisdictions where we elect to do business; and

•the growth rates of the markets in which we compete.

You should not rely on forward-looking statements as predictions of future events. The outcome of the events described in these forward-looking statements is subject to risks, uncertainties and other factors described under the header “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained herein. The results, events and circumstances reflected in the forward-looking statements may not be achieved or occur, and actual results, events or circumstances could differ materially from those described in the forward-looking statements.

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In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based on information available to us as of the date of this Quarterly Report on Form 10-Q. While we believe that information provides a reasonable basis for these statements, that information may be limited or incomplete. Our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely on these statements.

The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made, and we undertake no obligation to update them to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law.

Unless the context otherwise indicates, references in this report to the terms “ACV Auctions,” “ACV,” “the Company,” “we,” “our” and “us” refer to ACV Auctions Inc. and its subsidiaries.

We may announce material business and financial information to our investors using our investor relations website (investors.acvauto.com). We therefore encourage investors and others interested in ACV to review the information that we make available on our website, in addition to following our filings with the Securities and Exchange Commission (the "SEC"), webcasts, press releases and conference calls.

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PART I—FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

ACV AUCTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in thousands, except share data)


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Revenue:
Marketplace and service revenue	$	155,908	$	104,537	$	429,848	$	318,760
Customer assurance revenue	15,421		14,477		47,794		44,097
Total revenue	171,329		119,014		477,642		362,857
Operating expenses:
Marketplace and service cost of revenue (excluding depreciation & amortization)	67,064		47,928		187,010		145,732
Customer assurance cost of revenue (excluding depreciation & amortization)	14,176		12,464		41,548		38,081
Operations and technology	42,539		35,132		120,302		106,180
Selling, general, and administrative	54,973		40,797		160,738		123,689
Depreciation and amortization	9,716		4,980		26,351		12,086
Total operating expenses	188,468		141,301		535,949		425,768
Loss from operations	(17,139)		(22,287)		(58,307)		(62,911)
Other income (expense):
Interest income	2,050		4,489		7,410		12,505
Interest expense	(1,077)		(439)		(2,218)		(1,205)
Total other income (expense)	973		4,050		5,192		11,300
Loss before income taxes	(16,166)		(18,237)		(53,115)		(51,611)
(Benefit from) provision for income taxes	(137)		1		448		409
Net loss	$	(16,029)	$	(18,238)	$	(53,563)	$	(52,020)
Weighted-average shares - basic and diluted	165,723,168		160,427,987		164,337,209		159,541,286
Net loss per share - basic and diluted	$	(0.10)	$	(0.11)	$	(0.33)	$	(0.33)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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ACV AUCTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

(in thousands)


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Net loss	$	(16,029)	$	(18,238)	$	(53,563)	$	(52,020)
Other comprehensive income (loss):
Net unrealized gains (losses) on available-for-sale securities	326		210		682		237
Foreign currency translation (loss) gain	1,121		(377)		678		(113)
Comprehensive loss	$	(14,582)	$	(18,405)	$	(52,203)	$	(51,896)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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ACV AUCTIONS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in thousands, except share data)


	September 30, 2024		December 31, 2023
Assets
Current Assets:
Cash and cash equivalents	$	252,524	$	182,571
Marketable securities	35,228		228,761
Trade receivables (net of allowance of $7,005 and $2,868)	203,728		164,009
Finance receivables (net of allowance of $3,557 and $3,428)	130,785		119,034
Other current assets	16,967		12,524
Total current assets	639,232		706,899
Property and equipment (net of accumulated depreciation of $4,615 and $4,462)	7,932		4,918

Goodwill	177,899		103,379
Acquired intangible assets (net of amortization of $26,235 and $17,534)	98,971		34,192
Capitalized software (net of amortization of $32,333 and $17,059)	66,249		55,771
Other assets	44,070		17,765
Total assets	$	1,034,353	$	922,924
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable	$	385,696	$	305,845
Accrued payroll	15,044		12,245
Accrued other liabilities	21,502		15,851
Total current liabilities	422,242		333,941
Long-term debt	115,000		115,000
Other long-term liabilities	40,899		17,455
Total liabilities	578,141		466,396
Commitments and Contingencies (Note 5)
Stockholders' Equity:
Preferred Stock; $0.001 par value; 20,000,000 shares authorized; 0 and 0 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	—		—
Common Stock - Class A; $0.001 par value; 2,000,000,000 shares authorized; 157,720,580 and 138,637,352 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	158		139
Common Stock - Class B; $0.001 par value; 160,000,000 shares authorized; 9,325,487 and 23,205,487 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	9		23
Additional paid-in capital	932,392		880,510
Accumulated deficit	(476,178)		(422,615)
Accumulated other comprehensive loss	(169)		(1,529)
Total stockholders' equity	456,212		456,528
Total liabilities and stockholders' equity	$	1,034,353	$	922,924

The accompanying notes are an integral part of these condensed consolidated financial statements.

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ACV AUCTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

(in thousands, except share data)


	Three Months Ended September 30, 2024
	Common Stock Class A			Common Stock Class B			Additional Paid-In Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Stockholders' Equity
	Shares	Par Value		Shares	Par Value
Balance as of June 30, 2024	151,659,441	$	152	14,370,258	$	14	$	919,216	$	(460,149)	$	(1,616)	$	457,617
Conversion of Class B common stock to Class A common stock	5,106,981	5		(5,106,981)	(5)		—		—		—		—
Net loss	—	—		—	—		—		(16,029)		—		(16,029)
Other comprehensive income (loss)	—	—		—	—		—		—		1,447		1,447
Stock-based compensation	—	—		—	—		17,772		—		—		17,772
Exercise of common stock options	514,730	1		—	—		1,830		—		—		1,831
Vested restricted stock units	439,428	—		62,210	—		(6,426)		—		—		(6,426)

Balance as of September 30, 2024	157,720,580	$	158	9,325,487	$	9	$	932,392	$	(476,178)	$	(169)	$	456,212


	Nine Months Ended September 30, 2024
	Common Stock Class A			Common Stock Class B							Accumulated Other Comprehensive Loss
	Shares	Par Value		Shares	Par Value		Additional Paid-In Capital		Accumulated Deficit				Total Stockholders' Equity
Balance as of December 31, 2023	138,637,352	$	139	23,205,487	$	23	$	880,510	$	(422,615)	$	(1,529)	$	456,528
Conversion of Class B common stock to Class A common stock	14,710,017	15		(14,710,017)	(15)		—		—		—		-
Net loss	—	—		—	—		—		(53,563)		—		(53,563)
Other comprehensive income (loss)	—	—		—	—		—		—		1,360		1,360
Stock-based compensation	—	—		—	—		52,117		—		—		52,117
Issuance of shares for acquisitions	1,413,075	1		—	—		8,555		—		—		8,556
Exercise of common stock options	1,440,711	2		631,239	1		8,641		—		—		8,644
Vested restricted stock units	1,377,142	1		198,778	—		(19,429)		—		—		(19,428)
Issuance of shares for employee stock purchase plan	142,283	—		—	—		1,998		—		—		1,998

Balance as of September 30, 2024	157,720,580	$	158	9,325,487	$	9	$	932,392	$	(476,178)	$	(169)	$	456,212

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	Three Months Ended September 30, 2023
	Common Stock Class A			Common Stock Class B							Accumulated Other Comprehensive Loss
	Shares	Par Value		Shares	Par Value		Additional Paid-In Capital		Accumulated Deficit				Total Stockholders' Equity
Balance as of June 30, 2023	134,717,291	$	135	25,610,643	$	26	$	860,628	$	(381,136)	$	(3,484)	$	476,169
Conversion of Class B common stock to Class A common stock	474,343	1		(474,343)	(1)		—		—		—		—
Net loss	—	—		—	—		—		(18,238)		—		(18,238)
Other comprehensive income (loss)	—	—		—	—		—		—		(167)		(167)
Stock-based compensation	—	—		—	—		13,176		—		—		13,176
Exercise of common stock options	243,358	—		—	—		802		—		—		802
Vested restricted stock units	322,016	—		74,695	—		(4,644)		—		—		(4,644)

Balance as of September 30, 2023	135,757,008	$	136	25,210,995	$	25	$	869,962	$	(399,374)	$	(3,651)	$	467,098


	Nine Months Ended September 30, 2023
	Common Stock Class A			Common Stock Class B							Accumulated Other Comprehensive Loss
	Shares	Par Value		Shares	Par Value		Additional Paid-In Capital		Accumulated Deficit				Total Stockholders' Equity
Balance as of December 31, 2022	121,214,275	$	121	37,241,952	$	37	$	836,695	$	(347,354)	$	(3,775)	$	485,724
Conversion of Class B common stock to Class A common stock	12,269,282	12		(12,269,282)	(12)		—		—		—		—
Net loss	—	—		—	—		—		(52,020)		—		(52,020)
Other comprehensive income (loss)	—	—		—	—		—		—		124		124
Stock-based compensation	—	—		—	—		39,641		—		—		39,641
Exercise of common stock options	1,080,034	1		—	—		3,576		—		—		3,577
Vested restricted stock units	1,017,490	1		238,325	-		(11,280)		—		—		(11,279)

Issuance of shares for employee stock purchase plan	175,927	1		—	—		1,330		—		—		1,331
Balance as of September 30, 2023	135,757,008	$	136	25,210,995	$	25	$	869,962	$	(399,374)	$	(3,651)	$	467,098

The accompanying notes are an integral part of these condensed consolidated financial statements.

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ACV AUCTIONS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)


	Nine months ended September 30,
	2024		2023
Cash Flows from Operating Activities
Net income (loss)	$	(53,563)	$	(52,020)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	26,451		12,407
Stock-based compensation expense, net of amounts capitalized	48,055		36,262
Provision for bad debt	8,161		8,530
Other non-cash, net	369		(772)
Changes in operating assets and liabilities, net of effects from purchases of businesses:
Trade receivables	(16,803)		10,990
Other operating assets	(2,168)		(5,266)
Accounts payable	55,684		(2,543)
Other operating liabilities	2,430		1,023
Net cash provided by (used in) operating activities	68,616		8,611
Cash Flows from Investing Activities
Net increase in finance receivables	(12,536)		(30,991)
Proceeds from sale of real estate	14,083		—
Purchases of property and equipment	(3,834)		(1,518)
Capitalization of software costs	(22,438)		(19,319)
Purchases of marketable securities	(21,607)		(116,036)
Maturities and redemptions of marketable securities	85,164		107,690
Sales of marketable securities	130,090		2,649
Acquisition of businesses (net of cash acquired)	(156,608)		(28,649)
Net cash provided by (used in) investing activities	12,314		(86,174)
Cash Flows from Financing Activities
Proceeds from long term debt	455,000		305,000
Payments towards long term debt	(455,000)		(275,500)
Payment of debt issuance costs	(1,966)		—
Proceeds from exercise of stock options	8,644		3,576
Payment of RSU tax withholdings in exchange for common shares surrendered by RSU holders	(19,537)		(11,280)
Proceeds from employee stock purchase plan	1,998		1,330
Other financing activities	(66)		(74)
Net cash provided by (used in) financing activities	(10,927)		23,052
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	(50)		(5)
Net increase (decrease) in cash, cash equivalents, and restricted cash	69,953		(54,516)
Cash, cash equivalents, and restricted cash, beginning of period	182,571		280,752
Cash, cash equivalents, and restricted cash, end of period	$	252,524	$	226,236
Supplemental disclosure of cash flow information
Non-cash investing and financing activities:
Stock-based compensation included in capitalized software development costs	$	3,869	$	2,394
Purchase of property and equipment and internal use software in accounts payable	$	886	$	1,277

The accompanying notes are an integral part of these condensed consolidated financial statements

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ACV AUCTIONS INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Nature of Business and Summary of Significant Accounting Policies

Nature of Business – The Company operates in one industry segment, providing a wholesale auction marketplace (the “Marketplace”) to facilitate business-to-business used vehicle sales between a selling dealership (“Seller”) and a buying dealership (“Buyer”). Customers using the Marketplace are licensed automotive dealerships or other commercial automotive enterprises. At the election of the customer purchasing a vehicle, the Company can arrange third-party transportation services for the delivery of the purchased vehicle through its wholly owned subsidiary, ACV Transportation LLC. The Company can also provide the customer financing for the purchased vehicle through its wholly owned subsidiary, ACV Capital LLC ("ACV Capital"). ACV also provides data services that offer insights into the condition and value of used vehicles for transactions both on and off the Company's Marketplace, which help dealerships, their end customers, and commercial partners make more informed decisions to transact with confidence and efficiency. Customers using data services are licensed automotive dealerships or other commercial automotive enterprises. All services are provided in the United States and certain data services are also provided internationally. Services are supported by the Company’s operations which are primarily in North America and India.

Basis of Consolidation – The condensed consolidated financial statements include the accounts of ACV Auctions Inc. and all of its controlled subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Basis of Preparation – The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission ("SEC"). The Company has condensed or omitted certain information and notes normally included in complete annual financial statements prepared in accordance with GAAP. These financial statements have been prepared on the same basis as the Company's annual financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of the Company's financial information. The unaudited interim condensed consolidated financial statements should therefore be read in conjunction with the audited consolidated financial statements and accompanying notes contained in the Company's Annual Report on Form 10-K for the year ended December 31, 2023, as filed with the SEC on February 21, 2024 (the "Annual Report"). Any reference in these notes to applicable guidance is meant to refer to the authoritative GAAP as found in the Accounting Standards Codification (“ASC”) and Accounting Standards Update (“ASU”) of the Financial Accounting Standards Board (“FASB”).

Seasonality – The volume of vehicles sold through the Marketplace generally fluctuates from quarter to quarter. This seasonality is caused by several factors, including holidays, weather, the seasonality of the retail market for used vehicles and the timing of federal tax returns, which affects the demand side of the automotive industry. As a result, revenue and operating expenses related to volume fluctuate accordingly on a quarterly basis. In the fourth quarter, we typically experience lower used vehicle volume on our Marketplace as well as additional costs associated with the holidays. Seasonally depressed used vehicle volume on our Marketplace typically continues during the winter months through the beginning of the first quarter. Typical seasonality trends may not be observed in periods where other external factors more significantly impact the industry.

Recent Accounting Pronouncements – The following table provides a description of accounting standards that are not yet adopted that could have an impact to the consolidated financial statements upon adoption.

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Accounting Standard Update	Description	Required date of adoption	Effect on consolidated financial statements
Accounting Standards Not Yet Adopted
Improvements to Reportable Segment Disclosures (ASU 2023-07)	The guidance amends reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.	December 31, 2024	The Company is currently evaluating the impact of this guidance and expects the adoption to result in additional disclosures in the notes to our consolidated financial statements.
Income Taxes (ASU 2023-09)	The guidance amends income tax disclosure requirements to provide information to better assess how an entity's operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. It requires annual disclosure of specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold.	December 31, 2025	The Company is currently evaluating the impact this guidance may have on the consolidated financial statements.

2. Financial Instruments

The following is a summary of available-for-sale financial instruments, as of September 30, 2024 and December 31, 2023, respectively (in thousands):


	September 30, 2024
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Marketable securities:
Corporate securities (1)	$	31,098	$	36	$	(89)	$	31,045
U.S. treasury and agency securities	4,177		6		—		4,183
Total Marketable securities	$	35,275	$	42	$	(89)	$	35,228
(1)Comprised primarily of corporate bonds


	December 31, 2023
	Amortized Cost		Unrealized Gain		Unrealized Losses		Fair Value
Cash equivalents:
Corporate securities (1)	$	1,213	$	—	$	(1)	$	1,212
Total cash equivalents	1,213		—		(1)		1,212
Marketable securities:
Corporate securities (1)	$	199,084	$	115	$	(819)	$	198,380
U.S. treasury and agency securities	30,404		25		(48)		30,381
Total Marketable securities	$	229,488	$	140	$	(867)	$	228,761
(1)Comprised primarily of corporate bonds and commercial paper

As of September 30, 2024, the fair values of available-for-sale financial instruments, by remaining contractual maturity, were as follows (in thousands):


Due within one year	$	28,491
Due in one to five years	6,737
Total	$	35,228

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The Company typically invests in highly rated securities, with the primary objective of minimizing the potential risk of principal loss. The Company’s investment policy generally requires securities to be investment grade and limits the amount of credit exposure to any one issuer. Fair values were determined for each individual security in the investment portfolio.

The Company does not believe that any unrealized losses are attributable to credit-related factors based on its evaluation of available evidence. To determine whether a decline in value is related to credit loss, the Company evaluates, among other factors: the extent to which the fair value is less than the amortized cost basis, changes to the rating of the security by a rating agency and any adverse conditions specifically related to an issuer of a security or its industry. Unrealized gain and losses on marketable securities are presented net of tax.

3. Fair Value Measurement

Fair value accounting is applied for all financial assets and liabilities and non-financial assets and liabilities that are recognized or disclosed at fair value in the condensed consolidated financial statements on a recurring basis (at least annually). Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

Assets and liabilities recorded at fair value in the condensed consolidated financial statements are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels, which are directly related to the amount of subjectivity, associated with the inputs to the valuation of these assets or liabilities are as follows:

Level 1: Observable inputs such as quoted prices in active markets for identical assets and liabilities.

Level 2: Inputs other than the quoted prices in active markets that are observable either directly or indirectly.

Level 3: Unobservable inputs in which there is little or no market data which require the Company to develop its own assumptions.

The Company’s financial instruments that are not measured at fair value on a recurring basis include trade and finance accounts receivable and accounts payable whose carrying values approximate fair value due to the short-term nature of those instruments.

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis as of September 30, 2024 and December 31, 2023, and indicate the fair value hierarchy of the valuation inputs utilized to determine such fair value (in thousands):


	September 30, 2024
	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	83,971	$	—	$	—	$	83,971
Marketable Securities:
Corporate securities	—		31,045		—		31,045
U.S. treasury and agency securities	504		3,679		—		4,183
Total financial assets	$	84,475	$	34,724	$	—	$	119,199

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	December 31, 2023
	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	22,433	$	—	$	—	$	22,433
Corporate securities	—		1,212		—		1,212
Marketable Securities:
Corporate securities	—		198,380		—		198,380
U.S. treasury and agency securities	20,064		10,317		—		30,381
Total financial assets	$	42,497	$	209,909	$	—	$	252,406

The Company classifies its highly liquid money market funds and U.S treasury securities within Level 1 of the fair value hierarchy because they are valued based on quoted market prices in active markets. The Company classifies its corporate securities, and U.S. agency securities within Level 2 because they are valued using inputs other than quoted prices that are directly or indirectly observable in the market, including readily available pricing sources for the identical underlying security which may not be actively traded.

4. Accounts Receivable & Allowance for Doubtful Receivables

The Company maintains an allowance for doubtful receivables that in management’s judgment reflects losses inherent in the portfolio. A provision for doubtful receivables is recorded to adjust the level of the allowance in accordance with GAAP.

Changes in the allowance for doubtful trade receivables for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Beginning balance	$	5,507	$	3,629	$	2,868	$	4,860
Provision for bad debt	2,271		2,046		5,048		5,325
Net write-offs
Write-offs	(1,082)		(3,254)		(2,197)		(11,442)
Recoveries	309		935		1,286		4,613
Net (write-offs) recoveries	(773)		(2,319)		(911)		(6,829)
Ending balance	$	7,005	$	3,356	$	7,005	$	3,356

Changes in the allowance for doubtful finance receivables for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Beginning balance	$	3,192	$	3,048	$	3,428	$	2,275
Provision for bad debt	835		677		3,113		3,205
Net write-offs
Write-offs	(528)		(1,148)		(3,338)		(3,300)
Recoveries	58		96		354		493
Net (write-offs) recoveries	(470)		(1,052)		(2,984)		(2,807)
Ending balance	$	3,557	$	2,673	$	3,557	$	2,673

5. Guarantees, Commitments and Contingencies

The Company provides certain guarantees to Sellers in the Marketplace in the ordinary course of business, which are accounted for under ASC 460 as a general guarantee.

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Vehicle Condition Guarantees – Sellers must attach a vehicle condition report in the Marketplace for every auction; this vehicle condition report is used by Buyers to inform bid decisions. The Company offers guarantees to Sellers in qualifying situations where the Company performed a vehicle inspection and prepared the vehicle condition report. Sellers must pay an additional fee in exchange for this guarantee. The guarantee provides Sellers protection from paying remedies to Buyers related to a Buyer’s claim that the vehicle condition report did not accurately portray the condition of the vehicle purchased on the Marketplace. The guarantee provides the Company with the right to retain proceeds from the subsequent liquidation of the vehicle covered under the guarantee. The guarantee is typically provided for 10 days after the successful sale of the vehicle on the Marketplace. The fair value of vehicle condition guarantees issued is estimated based on historical results and other qualitative factors. The vehicle condition guarantee revenue is recognized on the earlier of the guarantee expiration date or the guarantee settlement date. The maximum potential payment is the sale price of the vehicle. The total sale price of vehicles for which there was an outstanding guarantee was $213.8 million and $142.8 million at September 30, 2024 and December 31, 2023, respectively. The carrying amount of the liability presented in Accrued other liabilities was $1.6 million and $1.2 million at September 30, 2024 and December 31, 2023, respectively.

The recognized probable loss contingency, in excess of vehicle condition guarantees recognized, presented in Accrued other liabilities was $1.8 million at September 30, 2024 and December 31, 2023.

Other Price Guarantees – The Company provides Sellers with a price guarantee for vehicles to be sold on the Marketplace from time to time. If a vehicle sells below the guaranteed price, the Company is responsible for paying the Seller the difference between the guaranteed price and the final sale price. The term of the guarantee is typically less than one week. No material unsettled price guarantees existed at September 30, 2024 and December 31, 2023.

Litigation – The Company and its subsidiaries are subject in the normal course of business to various pending and threatened legal proceedings and matters in which claims for monetary damages are asserted. On an on-going basis management, after consultation with legal counsel, assesses the Company's liabilities and contingencies in connection with such proceedings. For those matters where it is probable that the Company will incur losses and the amounts of the losses can be reasonably estimated, the Company records an expense and corresponding liability in its condensed consolidated financial statements. To the extent pending or threatened litigation could result in exposure in excess of the recorded liability, the amount of such excess is not currently estimable.

6. Borrowings

2021 Revolver

On August 24, 2021, ACV Auctions Inc. entered into a revolving credit facility (the “2021 Revolver”). The 2021 Revolver was established to provide general financing to the Company. The 2021 Revolver is secured by substantially all of the Company's assets except for ACV Capital receivables. The maximum borrowing principal amount of the 2021 Revolver is $160.0 million and includes a sub facility that provides for the issuance of letters of credit up to $20.0 million outstanding at any time.

On June 1, 2023, the Company entered into Amendment No. 1 (the "First Amendment"), which modified the rate to which interest payments are indexed to the Secured Overnight Financing Rate, or SOFR. The interest rate applicable to the 2021 Revolver is, at our option, either (a) SOFR (or a replacement rate established in accordance with the terms of the credit agreement for the 2021 Revolver) (subject to a 0.00% SOFR floor), plus a margin of 2.75% per annum plus an additional credit spread adjustment of 0.11% for daily and one-month terms, 0.26% for three-month terms and 0.43% for six-month terms or (b) the Alternate Base Rate plus a margin of 1.75% per annum. The Alternate Base Rate is the highest of (a) the Wall Street Journal prime rate, (b) the NYFRB rate plus 0.5% and (c)(i) 1.00% plus (ii) the adjusted SOFR rate for a one-month interest period. The First Amendment maintains a maximum borrowing principal amount of $160.0 million.

On June 20, 2024, the Company entered into Amendment No. 2 (the "Second Amendment") to permit the Company, ACV Capital and ACV Capital Funding II LLC ("ACV Funding"), a wholly owned, bankruptcy-remote, special-purpose subsidiary of ACV Capital, to enter into the transactions contemplated by the Warehouse Facility.

On October 7, 2024, the Company entered into Amendment No. 3 on the 2021 Revolver which allows the Company to make investments and other acquisitions (i) if Total Liquidity (as defined therein) immediately prior to the consummation of such investment or acquisition and after giving pro forma effect to such investment or acquisition is equal to or greater than $200.0 million, in an unlimited amount or (ii) if Total Liquidity immediately prior to the

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consummation of such investment or acquisition and after giving pro forma effect to such investment or acquisition is less than $200.0 million, in an amount not to exceed $25.0 million in the aggregate for any fiscal year of the Company.

Refer to Note 9 contained in our Annual Report on Form 10-K for the year ended December 31, 2023 for further details and key terms regarding the 2021 Revolver.

As of September 30, 2024 and December 31, 2023, outstanding borrowings under the 2021 Revolver were $48.5 million and $115.0 million, respectively, and there were outstanding letters of credit issued under the 2021 Revolver in the amount of $3.3 million and $2.1 million, respectively decreasing the availability under the 2021 Revolver by a corresponding amount. As of September 30, 2024, the interest rate on the outstanding borrowing was 9.75%.

Warehouse Facility

On June 20, 2024, ACV Funding entered into a revolving credit and security agreement, providing for a revolving warehouse facility (the "Warehouse Facility") with a maximum principal amount of $125.0 million. The Warehouse Facility was established to provide liquidity to fund new originations of auto floorplan loans by ACV Capital. The facility is secured by all assets of ACV Funding, including the auto floorplan loans owned by it. The revolving feature on the facility ends on June 20, 2026. The facility matures twelve months later, unless sooner terminated or extended in accordance with its terms.

Advances under the Warehouse Facility funded by asset-backed commercial paper conduit through the issuance of commercial paper notes will bear interest generally at a rate equivalent to the weighted average annual rate of all commercial paper notes issued by the commercial paper conduit to fund its advances, plus a margin of 3.00%. Advances funded by lenders that are not commercial paper conduits, or by commercial paper conduits funded through means other than the issuance of commercial paper notes, will bear interest generally at a rate equal to (i) Term SOFR for a period of one-month (subject to a 0.00% floor), plus 0.11448% or, in certain circumstances, the Alternate Base Rate, plus (ii) a margin of 3.00%. The Alternate Base Rate is the highest of (a) the prime rate quoted in the Wall Street Journal, (b) the NYFRB rate plus 0.50% and (c)(i) 1.00% plus (ii) the Term SOFR rate for a one-month interest period. The interest rate may be increased under certain circumstances, including upon the occurrence of an early amortization event or event of default under the warehouse documentation. ACV Funding must also pay upfront any unused fees in connection with the facility. As of September 30, 2024 borrowings under the Warehouse Facility were $66.5 million with an interest rate of 8.21%.

As of September 30, 2024, the Company was in compliance with all of its financial covenants and non-financial covenants.

7. Leases

The Company leases office space under operating leases expiring at various dates through 2038. For the three and nine months ended September 30, 2024, the Company incurred operating lease costs of $1.9 million and $4.8 million, respectively. For the three and nine months ended September 30, 2023, the Company incurred operating lease costs of $1.0 million and $1.8 million, respectively. For operating leases, the weighted-average remaining term is 10.7 years and 7.3 years with a weighted-average discount rate of 10% and 5% for the periods ended September 30, 2024 and December 31, 2023, respectively.

Maturities of lease liabilities as of September 30, 2024 were as follows (in thousands):


2024 (remaining)	$	1,921
2025	7,564
2026	7,350
2027	7,044
2028	6,794
Thereafter	35,486
Total lease payments	66,159
Less imputed interest	(24,801)
Total	$	41,358

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The following amounts relate to operating leases that were recorded on the Company's Condensed Consolidated Balance Sheets at September 30, 2024 and December 31, 2023 (in thousands):


	September 30, 2024		December 31, 2023
Operating lease right of use assets:
Other assets	$	41,594	$	16,858
Operating lease liabilities:
Accrued other liabilities	3,627		1,647
Other long-term liabilities	37,731		15,034

The Company recorded right of use assets in exchange for new lease liabilities of $10.9 million and $25.2 million during the three and nine months ended September 30, 2024, respectively. The Company recorded right of use assets in exchange for new lease liabilities of $9.6 million and $15.3 million during the three and nine months ended September 30, 2023, respectively.

8. Revenue

The following table summarizes the primary components of revenue; this level of disaggregation takes into consideration how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Auction marketplace revenue	$	84,894	$	51,390	$	227,656	$	159,911
Other marketplace revenue	62,748		45,012		177,671		134,251
Data services revenue	8,266		8,135		24,521		24,598
Marketplace and service revenue	$	155,908	$	104,537	$	429,848	$	318,760

Contract liabilities represent consideration collected prior to satisfying performance obligations. The Company had $5.2 million and $4.2 million of contract liabilities included in Accrued other liabilities on the Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023, respectively. Revenue recognized for the three months ended September 30, 2024 from amounts included in deferred revenue as of June 30, 2024 was $5.4 million. Revenue recognized for the nine months ended September 30, 2024 from amounts included in deferred revenue as of December 31, 2023 was $4.2 million. All the remaining performance obligations for contracts are expected to be recognized within one year.

9. Stock-Based Compensation

Refer to Note 13 contained in our Annual Report on Form 10-K for the year ended December 31, 2023 for further details regarding our equity plans.

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The following table summarizes the stock option activity for the nine months ended September 30, 2024 (in thousands, except for share and per share amounts):


	Number of Options	Weighted- Average Exercise Price Per Share		Intrinsic Value		Weighted- Average Remaining Contractual Term (in years)
Outstanding, December 31, 2023	6,296,350	$	2.49	$	79,728	4.83
Exercised	(2,072,230)	4.17
Forfeited	(4,032)	5.60
Expired	(23,839)	5.05
Outstanding, September 30, 2024	4,196,249	$	1.64	$	78,434	3.54
Exercisable, September 30, 2024	4,147,984	$	1.57	$	77,796	3.51

The following table summarizes the restricted stock unit and performance share unit activity for the nine months ended September 30, 2024 (in thousands, except for share and per share amounts):


	Number of RSUs	Weighted- Average Grant-Date Fair Value
Outstanding, December 31, 2023	7,237,920	$	14.37
Granted	4,745,687	$	17.45
Vested	(2,707,252)	$	14.79
Forfeited	(406,205)	$	15.02
Outstanding, September 30, 2024	8,870,150	$	15.84

As of September 30, 2024, there was approximately $122.5 million of compensation expense related to the unvested portion of common stock options, restricted stock units, and performance share units that will be recorded as compensation expense over a weighted-average period of 2.5 years.

During the first quarter of 2024, the Company entered into two contingently returnable share agreements (the "2024 Agreements") for certain compensatory share-based service awards. The 2024 Agreements authorized 773,099 shares of common stock to be issued. Shares will be released and distributed to the employee award recipients with the final vesting date during the first quarter of 2028. At September 30, 2024, there was approximately $9.5 million of compensation expense related to the unvested portion of the contingently returnable shares that will be recorded over 3.33 years.

During the second quarter of 2024, the Company's Board of Directors approved long-term incentive awards to certain of the Company's executive officers which comprised performance share units (“PSUs”), which may only be settled in shares of the Company’s Class A Common Stock. The PSUs are subject to both service-based vesting conditions and a requirement that the average closing price of the Company’s Class A Common Stock, as measured over a period of 30 trading days commencing at the grant date and ending July 1, 2027, equal or exceed a designated level (the “Stock Price Condition”). The PSUs will vest in one-third installments on each of July 1, 2025, 2026 and 2027, provided that the Stock Price Condition has been satisfied prior to the relevant date. If the Stock Price Condition has not yet been satisfied prior to the relevant date, then the PSUs that otherwise would have vested on such date will remain unvested unless and until the Stock Price Condition has been satisfied. If the Stock Price Condition has not been satisfied by July 1, 2027, then the PSUs will be forfeited on that date. In each circumstance, vesting is subject to the executive’s continued service with the Company until the time of vesting.

10. Income Taxes

The Company had an effective tax rate of approximately 1% and 0% for the three months ended September 30, 2024 and 2023, and (1)% and (1)% for the nine months ended September 30, 2024 and 2023, respectively. The principal differences between the federal statutory rate and the effective tax rate are related to state taxes, foreign taxes and credits, and the non-recognition of tax benefits for certain entities in a loss position for which a full valuation allowance has been recorded.

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11. Net Income (Loss) Per Share

The numerators and denominators of the basic and diluted net income (loss) per share computations for the Company's common stock are calculated as follows for the three and nine months ended September 30, 2024 and 2023 (in thousands, except share data):


	Three months ended September 30,								Nine months ended September 30,
	2024				2023				2024				2023
	Class A		Class B		Class A		Class B		Class A		Class B		Class A		Class B
Numerator:
Net loss attributable to common stockholders	$	(14,734)	$	(1,295)	$	(15,327)	$	(2,911)	$	(47,932)	$	(5,631)	$	(42,540)	$	(9,480)
Denominator:
Weighted-average number of shares of common stock - Basic and diluted	152,333,761		13,389,407		134,822,341		25,605,646		147,060,846		17,276,363		130,464,809		29,076,477
Net loss per share attributable to common stockholders:
Basic and diluted	$	(0.10)	$	(0.10)	$	(0.11)	$	(0.11)	$	(0.33)	$	(0.33)	$	(0.33)	$	(0.33)

The following table presents the total weighted-average number of potentially dilutive shares that were excluded from the computation of diluted net loss per share attributable to common shareholders because their effect would have been anti-dilutive for the period presented:


	Three months ended September 30,		Nine months ended September 30,
	2024	2023	2024	2023
Unvested RSUs and other awards	3,348,306	2,368,186	3,234,667	2,099,410
Stock options	4,049,296	5,428,444	4,497,191	5,477,646

12. Acquisitions

The Company completed four business acquisitions during the nine months ended September 30, 2024 and two business acquisitions during the nine months ended September 30, 2023. These acquisitions were accounted for using the acquisition method and, accordingly, the results of the acquired businesses have been included in the Company's results of operations from the respective acquisition dates. Purchase price allocations related to these acquisitions are subject to adjustments as they are finalized over the 12-month measurement period from the respective acquisition date. Goodwill acquired in connection with these acquisitions represents expected synergies from the combined operations, is deductible for tax purposes in the United States, and is amortized on a straight-line basis over 15 years.

June 2024 Acquisition

On June 17, 2024, the Company completed its acquisition of all of the ownership interest of a business (the "June 2024 acquisition") for estimated cash consideration of $51.6 million, which included $5.0 million of acquired cash and $14.1 million of acquired real estate. The aggregate purchase price was preliminarily allocated to $11.4 million of goodwill, $18.7 million of intangibles, and $21.4 million of net tangible assets assumed. The Company completed a sale of the real estate to a third party on August 6, 2024. The business acquired in the June 2024 acquisition offers wholesale and commercial car auction and reconditioning services and enabled the Company to expand its range of offerings to dealers and commercial partners.

March 13, 2024 Acquisition

On March 13, 2024, the Company completed its acquisition of all of the ownership interests of a business (the "March 13, 2024 acquisition") for estimated cash consideration of $19.1 million. The aggregate purchase price was preliminarily allocated to $14.4 million of goodwill, $5.5 million of intangible assets, and $0.7 million of net tangible

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liabilities assumed. The business acquired in the March 13, 2024 acquisition offers wholesale car auction services and enabled the Company to expand its range of offerings to dealers and commercial partners.

March 8, 2024 Acquisition

On March 8, 2024, the Company completed its acquisition of all of the ownership interests of a business (“the March 8, 2024 acquisition”) for estimated cash consideration of $27.4 million. The aggregate purchase price was preliminarily allocated to $7.4 million of goodwill, $16.3 million of intangible assets, and $3.6 million of net tangible assets assumed. The business acquired in the March 8, 2024 acquisition offers wholesale and commercial car auction and reconditioning services and enabled the Company to expand its range of offerings to dealers and commercial partners.

Alliance Auto Auctions

On January 30, 2024, the Company completed its acquisition of all of the ownership interests of Alliance Auto Auctions for estimated cash consideration of $66.9 million and 639,976 common shares of the Company's Class A common stock. The fair value of the consideration shares of $8.6 million was determined based upon the closing market price of the Company's Class A common shares on January 30, 2024.

The aggregate purchase price for the Alliance Auto Auctions acquisition was preliminarily allocated to the assets and liabilities assumed as follows (in thousands):


Assets Acquired
Cash and cash equivalents	$	2,467
Trade receivables	14,926
Finance receivables	—
Other current assets	768
Property & equipment	892
Goodwill	40,391
Acquired intangible assets	32,700
Other assets	8,305
Total assets acquired	$	100,449
Liabilities Assumed
Accounts payable	$	15,040
Accrued payroll	400
Accrued other liabilities	2,132
Deferred revenue	64
Other long-term liabilities	7,362
Total liabilities assumed	24,998
Net assets acquired	$	75,451

Alliance Auto Auctions offers wholesale car auction services and enabled the Company to expand its range of offerings to dealers and commercial partners.

April 2023 Acquisition

On April 24, 2023, the Company completed its acquisition of all of the ownership interests of a business (“the April 2023 acquisition”) for total cash consideration of $12.5 million. The aggregate purchase price was allocated to $5.3 million of goodwill, $6.0 million of intangible assets, and $1.2 million of net tangible assets assumed. The business acquired in the April 2023 acquisition offers wholesale and commercial car auction services and enabled the Company to expand its range of offerings to dealers and commercial partners.

August 2023 Acquisition

On August 22, 2023, the Company completed its acquisition of all of the ownership interests of a business ("the August 2023 acquisition") for total cash consideration of $16.9 million. The aggregate purchase price was allocated to

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$6.2 million of goodwill, $14.2 million of intangible assets, and $3.6 million of net tangible liabilities assumed. The business acquired in the August 2023 acquisition offers wholesale commercial car auction services and enabled the Company to expand its range of offerings to dealers and commercial partners.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations together with our unaudited condensed consolidated financial statements and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q and our audited consolidated financial statements and the related notes and the discussion under the heading "Management's Discussion and Analysis of Financial Condition and Results of Operations" relating to our financial condition and results of operations for the year ended December 31, 2023 included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission, or SEC, on February 21, 2024, or the Annual Report. Some of the information contained in this discussion and analysis, including information with respect to our financial condition or results of operations, business strategy and plans and objectives of management for future operations, includes forward-looking statements that involve risks and uncertainties as described under the heading “Special Note Regarding Forward-Looking Statements” in this Form 10-Q. You should review the “Risk Factors” section of our Annual Report for a discussion of important factors that could cause our actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Overview

Our mission is to build and enable the most trusted and efficient marketplace platform for buying and selling used vehicles with transparency and comprehensive data that was previously unimaginable.

We provide a highly efficient and vibrant marketplace platform ("marketplace platform" or "marketplace") for wholesale vehicle transactions and data services that offer transparent and accurate vehicle information to our customers. Our marketplace platform leverages data insights and technology to power our digital marketplace and data services, enabling our dealers and commercial partners to buy, sell, and value vehicles with confidence and efficiency. We strive to solve the challenges that the used automotive industry has faced for generations and provide powerful technology-enabled capabilities to our dealers and commercial partners who fulfill a critical role in the automotive ecosystem. We help dealers source and manage inventory and accurately price their vehicles as well as process payments, transfer titles, manage arbitrations, and finance and transport vehicles. Our marketplace platform encompasses:

•Digital Marketplace. Connects buyers and sellers of wholesale vehicles in an intuitive and efficient manner. Our core digital marketplace offerings are auctions in varying formats, which facilitate real time transactions of wholesale vehicles, and are accessible across multiple platforms including mobile apps, desktop, and directly through API integration. We also offer transportation, financing and assurance services to facilitate the entire transaction journey.

•Remarketing Centers. Provides an additional channel to provide dealers and commercial partners with auction services. At remarketing centers, vehicles may be auctioned onsite and/or launched into the digital marketplace. Additional services are offered at remarketing centers that are important to servicing commercial partners.

•Data Services. Offers insights into the condition and value of used vehicles for transactions both on and off our marketplace and helps dealers, their end consumers, and commercial partners make more informed decisions and transact with confidence and efficiency. We enable dealers to manage their inventory and set pricing more effectively while turning vehicles faster and maximizing profit by leveraging predictive analytics informed by artificial intelligence, machine learning and market data.

•Data and Technology. Underpins everything we do, and powers our vehicle inspections, comprehensive vehicle intelligence reports, digital marketplace, inventory management software, and operations automation.

We have historically generated the majority of our revenue from our digital marketplace where we earn auction and ancillary fees from both buyers and sellers in each case only upon a successful auction. Buyer auction fees are variable based on the price of the vehicle, while seller auction fees include a fixed auction fee and an optional fee for the elective condition report associated with the vehicle. We also earn ancillary fees through additional value-added services to buyers and sellers in connection with the auction.

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Our customers include participants on our marketplace platform and purchasers of our data services. Certain dealers and commercial partners purchase data services in connection with vehicle assessments, software subscriptions, and transactions that do not occur on our marketplace. Our dealer customers include a majority of the top 100 used vehicle dealers in the United States.

Key Operating and Financial Metrics

We regularly monitor a number of operating and financial metrics in order to measure our current performance and estimate our future performance. Our business metrics may be calculated in a manner different than similar business metrics used by other companies.


	Three Months Ended September 30,						Nine Months Ended September 30,
	2024			2023			2024			2023
Marketplace Units	198,354			150,057			559,511			454,768
Marketplace GMV	$	2.5	billion	$	2.1	billion	$	7.2	billion	$	7.0	billion
Adjusted EBITDA	$	11.2	million	$	(3.7)	million	$	22.5	million	$	(12.8)	million

Marketplace Units

Marketplace Units is a key indicator of our potential for growth in Marketplace GMV and revenue. It demonstrates the overall engagement of our customers and our market share of wholesale transactions in the United States. We define Marketplace Units as the number of vehicles transacted within the applicable period. Marketplace Units transacted includes any vehicle that successfully reaches sold status, even if the auction is subsequently unwound, meaning the buyer or seller does not complete the transaction. These instances were immaterial in the periods presented. Marketplace Units exclude vehicles that were inspected by ACV, but not sold. Marketplace Units have generally increased as we have expanded our territory coverage, added new Marketplace Buyers and Marketplace Sellers and increased our share of wholesale transactions from existing customers. Because we only earn auction and ancillary fees in the case of a successful auction, Marketplace Units will remain a critical driver of our revenue growth.

Marketplace GMV

Marketplace GMV is primarily driven by the volume and dollar value of Marketplace Unit transactions. We believe that Marketplace GMV acts as an indicator of our success, signaling satisfaction of dealers and buyers, and the health, scale, and growth of our business. We define Marketplace GMV as the total dollar value of vehicles transacted within the applicable period, excluding any auction and ancillary fees. Because our definition of Marketplace Units does not include vehicles inspected but not sold, and because the value of the vehicle sold is not recognized as revenue, GMV does not represent revenue earned by us. We expect that Marketplace GMV will continue to grow as Marketplace Units grow, though at a varying rate within a given applicable period, as Marketplace GMV is also impacted by the value of each vehicle transacted. In periods of declining used vehicle values, Marketplace GMV may decline even while Marketplace Units increase.

Marketplace Buyers

We define Marketplace Buyers as dealers or commercial partners with a unique customer ID that have transacted at least once in the last 12 months as a buyer on our marketplace platform. Marketplace Buyers include independent and franchise dealers buying on our marketplace.

Marketplace Sellers

We define Marketplace Sellers as dealers or commercial partners with a unique customer ID that have transacted at least once in the last 12 months as a seller on our marketplace platform. Marketplace Sellers include independent and franchise dealers selling on our marketplace, as well as commercial partners, consisting of commercial leasing companies, rental car companies, bank or other finance companies, who use our marketplace to sell their inventory.

We monitor the growth in both Marketplace Buyers and Marketplace Sellers as they each promote a more vibrant and healthy marketplace. We believe that our growth in Marketplace Sellers and Marketplace Buyers over time has been driven by the value proposition of our offerings, and our sales and marketing success, including our ability to attract new

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dealers and commercial partners to our marketplace platform. Based on our current position in the market, we believe that we have significant opportunity to continue to increase the number of Marketplace Buyers and Marketplace Sellers.

Adjusted EBITDA

Adjusted EBITDA is a performance measure that we use to assess our operating performance and the operating leverage in our business. We define Adjusted EBITDA as net income (loss), adjusted to exclude: depreciation and amortization, stock-based compensation expense, interest (income) expense, provision for income taxes, and other one-time, non-recurring items, when applicable, such as acquisition-related and restructuring expenses. We monitor Adjusted EBITDA as a non-GAAP financial measure to supplement the financial information we present in accordance with generally accepted accounting principles, or GAAP, to provide investors with additional information regarding our financial results. For further explanation of the uses and limitations of this measure and a reconciliation of our Adjusted EBITDA to the most directly comparable GAAP measure, net income (loss), please see “—Non-GAAP Financial Measures.”

We expect Adjusted EBITDA to fluctuate in the near term as we continue to invest in our business and improve over the long term as we achieve greater scale in our business and efficiencies in our operating expenses.

Factors Affecting Our Performance

We believe that the growth and future success of our business depend on many factors. While each of these factors presents significant opportunities for our business, they also pose important challenges that we must successfully address in order to sustain our growth, improve our results of operations, and increase profitability.

Increasing Marketplace Units

Increasing Marketplace Units is a key driver of our revenue growth. The transparency, efficiency and vibrancy of our marketplace is critical to our ability to grow our share of wholesale transactions from existing customers and attract new buyers and sellers to our marketplace platform. Failure to increase the number of Marketplace Units would adversely affect our revenue growth, operating results, and the overall health of our marketplace.

Grow Our Share of Wholesale Transactions from Existing Customers

Our success depends in part on our ability to grow our share of wholesale transactions from existing customers, increasing their engagement and spend on our marketplace platform. We remain in the early stages of penetrating our Marketplace Buyers’ and Sellers’ total number of wholesale transactions. As we continue to invest in eliminating key risks of uncertainty related to the auction process through our trusted and efficient marketplace platform, we expect that we will capture an increasing share of transactions from our existing buyers and sellers. Our ability to increase share from existing customers will depend on a number of factors, including our customers’ satisfaction with our marketplace platform, competition, pricing and overall changes in our customers’ engagement levels.

Add New Marketplace Buyers and Marketplace Sellers

We believe we have a significant opportunity to add new marketplace participants. As we expand our presence within our existing territories, we are able to drive increased liquidity and greater vehicle selection, which in turn improves our ability to attract new Marketplace Buyers and Marketplace Sellers. Additionally, we intend to add more commercial consignors to our marketplace platform and capture a greater share of vehicles in the wholesale market that are sold to dealers by commercial consignors through auctions and private sales.

Our ability to attract new Marketplace Buyers and Marketplace Sellers will depend on a number of factors including: the ability of our sales team to onboard dealers and commercial consignors onto our marketplace platform and ensure their satisfaction, the ability of our territory managers to build awareness of our brand, the ability of our vehicle condition inspectors, or VCIs, to cultivate relationships with our customers in their respective territories, and the effectiveness of our marketing efforts.

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Grow Awareness for Our Offerings and Brand

Wholesale vehicle online penetration is in the early stages, lagging the consumer automotive market, and we expect more dealers and commercial partners to source and manage their inventory online. As the digitization of the wholesale automotive market accelerates, we believe that our digital marketplace is well positioned to capture a disproportionate share of that growth. We use targeted sales and marketing efforts to educate potential Marketplace Buyers and Marketplace Sellers as to the benefits of our offerings and drive adoption of our marketplace platform. Our ability to grow awareness of our offerings and brand depend on a number of factors, including:

•Secure Trusted Supply. The more trusted supply on our marketplace, the more buyers we can attract to our marketplace platform.

•Deepen Relationships with Dealers and Commercial Partners. We have a team of VCIs who regularly interact with our customers, providing high-quality inspection services and developing strong customer relationships.

•Drive Customer Loyalty. Our loyal customers and referrals serve as a highly effective customer acquisition tool, and help drive our growth in a given territory.

•Grow Brand Awareness. We invest in promoting our brand via targeted marketing spend to increase customer awareness in the territories in which we operate.

Our future success is dependent on our ability to successfully grow our market presence and market and sell products to both new and existing customers.

Grow Value-Added and Data Services

We continue to drive customer adoption of our existing value-added and data services and introduce new and complementary products. Our ability to drive higher attachment rates of existing value-added services, such as ACV Transportation and ACV Capital, will help grow our revenue. In 2019 we launched our financing arm, ACV Capital. In 2021, we added ACV MAX (formerly doing business as MAX Digital) flagship inventory management system to our portfolio of data services offerings. We continue to drive customer adoption of our data services such as our True360 Reports that bring transparency and offer insights into the condition and value of used vehicles, as well as our inventory management system, which enables dealers to accurately price wholesale and retail inventory while maximizing profit by leveraging predictive analytics informed by artificial intelligence. These data services enable our customers to make more informed inventory management decisions both on and off our digital marketplace. In addition, we will continue to focus on developing new products and services that enhance our marketplace platform in areas including new data-powered products. Our ability to drive customer adoption of these products and services is dependent on the pricing of our products, the offerings of our competitors and the effectiveness of our marketing efforts.

Investment in Growth

We are actively investing in our business. In order to support our future growth and expanded product offerings, we expect this investment to continue. We anticipate that our operating expenses will increase as we continue to build our sales and marketing efforts, expand our employee base and invest in our technology development. The investments we make in our marketplace platform are designed to grow our revenue opportunity and to improve our operating results in the long term, but these investments could also delay our ability to achieve sustained profitability or reduce our profitability in the near term. Our success is dependent on making value-generative investments that support our future growth.

Used Car Demand

Our success depends in part on sufficient demand for used vehicles. Our growth over the last several years has coincided with a rising consumer demand for used vehicles. Since early 2020 demand for cars has outpaced supply. During this period, we have seen new car supply have a significant impact on the supply of wholesale vehicles available within our marketplace. More recently, new vehicle supply has begun to increase, although still below 2019 levels. However, this increase in new vehicle supply has been coupled with an increase in interest rates which has made both new and used vehicles more expensive for retail consumers utilizing financing. Used car demand will be in part dependent on the economic health of the retail consumer and their ability to afford a vehicle purchase.

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Used vehicle sales are also seasonal. Sales typically peak late in the first quarter and early in the second quarter, with the lowest relative level of industry vehicle sales occurring in the fourth quarter. Due to our growth since launch, our sales patterns to date have not been entirely reflective of the general seasonality of the used vehicle market, but we expect this to normalize as our business matures. Seasonality also impacts used vehicle pricing, with used vehicles depreciating at a faster rate in the last two quarters of each year and a slower rate in the first two quarters of each year. We may experience seasonal and other fluctuations in our quarterly results of operations, which may not fully reflect the underlying performance of our business. See the section titled “Seasonality” for additional information on the impacts of seasonality on our business.

Components of Results of Operations

Revenue

Marketplace and Service Revenue

We have historically generated the majority of our revenue from our digital marketplace where we earn auction and ancillary fees from both buyers and sellers, in each case only upon a successful auction. Our marketplace and service revenue consists principally of revenue earned from facilitating auctions and arranging for the transportation of vehicles purchased in such auctions.

We act as an agent when facilitating a vehicle auction through the marketplace. Auction and related fees charged to the buyer and seller are reported as revenue on a net basis, excluding the price of the auctioned vehicle in the transaction.

We act as a principal when arranging for the transportation of vehicles purchased on the marketplace and leverage our network of third-party transportation carriers to secure the arrangement. Transportation fees charged to the buyer are reported on a gross basis.

We also generate data services revenue through our True360 reports and ACV MAX inventory management software subscriptions and offer short-term inventory financing to eligible customers purchasing vehicles through the marketplace.

Customer Assurance Revenue

We also generate revenue by providing our Go Green assurance to sellers on the condition of certain vehicles sold on the marketplace, which is considered a guarantee under GAAP. This assurance option is only available for Go Green sellers on qualifying vehicles for which we have prepared the vehicle condition report. Customer assurance revenue also includes revenue from other price guarantee products offered to sellers. Customer assurance revenue is measured based upon the fair value of the guarantees that we provide. We expect the fair value per vehicle assured to decrease over time as we continue to improve the quality of our inspection product, which in turn reduces the costs of satisfying such assurance.

Operating Expenses

Marketplace and Service Cost of Revenue

Marketplace and service cost of revenue consists of third-party transportation carrier costs, titles shipping costs, customer support, website hosting costs, inspection costs related to data services and various other costs. These costs include salaries, benefits, bonuses and related stock-based compensation expenses, which we refer to as personnel expenses. We expect our marketplace and service cost of revenue to continue to increase in absolute dollars as we continue to scale our business and introduce new product and service offerings.

Customer Assurance Cost of Revenue

Customer assurance cost of revenue consists of the costs related to satisfying claims against the vehicle condition guarantees, and other price guarantees.

Operations and Technology

Operations and technology expense consists of costs for wholesale auction inspections, personnel costs related to payments and titles processing, transportation processing, product and engineering and other general operations and technology expenses. These costs include personnel-related expenses and other allocated facility and office costs. We expect that our operations and technology expense will increase in absolute dollars as our business grows, particularly as

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we incur additional costs related to continued investments in our marketplace, transportation capabilities and other technologies.

Selling, General and Administrative

Selling, general and administrative expense consists of costs resulting from sales, accounting, finance, legal, marketing, human resources, executive, and other administrative activities. These costs include personnel-related expenses, legal and other professional services expenses and other allocated facility and office costs. Also included in selling, general and administrative expense is advertising and marketing costs to promote our services. We expect that our selling, general and administrative expense will increase in absolute dollars as our business grows. However, we expect that our selling, general and administrative expense will decrease as a percentage of our revenue as our revenue grows over the longer term.

Depreciation and Amortization

Depreciation and amortization expense consists of depreciation of fixed assets, and amortization of acquired intangible assets and internal-use software.

Other Income (Expense)

Other income (expense) consists primarily of interest income earned on our marketable securities and cash and cash equivalents. Other income (expense) also includes interest expense on our borrowings.

Provision for Income Taxes

Provision for income taxes consists of U.S. federal, state and foreign income taxes.

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Results of Operations

The following table sets forth our Condensed Consolidated Statements of Operations data expressed as a percentage of total revenue for the periods presented:


	Three months ended September 30,
	2024				2023
	Amount		% of Revenue		Amount		% of Revenue
	(in thousands)
Revenue:
Marketplace and service revenue	$	155,908	91	%	$	104,537	88	%
Customer assurance revenue	15,421		9	%	14,477		12	%
Total revenue	171,329		100	%	119,014		100	%
Operating expenses:
Marketplace and service cost of revenue (excluding depreciation & amortization) (1)	67,064		39	%	47,928		40	%
Customer assurance cost of revenue (excluding depreciation & amortization)	14,176		8	%	12,464		10	%
Operations and technology (1)	42,539		25	%	35,132		30	%
Selling, general, and administrative (1) (3) (5) (6)	54,973		32	%	40,797		34	%
Depreciation and amortization (2) (4)	9,716		6	%	4,980		4	%
Total operating expenses	188,468				141,301
Income (loss) from operations	(17,139)				(22,287)
Other Income (expense):
Interest income	2,050				4,489
Interest expense	(1,077)				(439)
Total other income (expense)	973				4,050
Income (loss) before income taxes	(16,166)				(18,237)
Provision for income taxes	(137)				1
Net loss	$	(16,029)			$	(18,238)

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	Nine months ended September 30,
	2024				2023
	Amount		% of Revenue		Amount		% of Revenue
	(in thousands)
Revenue:
Marketplace and service revenue	$	429,848	90	%	$	318,760	88	%
Customer assurance revenue	47,794		10	%	44,097		12	%
Total revenue	477,642		100	%	362,857		100	%
Operating expenses:
Marketplace and service cost of revenue (excluding depreciation & amortization) (1)	187,010		39	%	145,732		40	%
Customer assurance cost of revenue (excluding depreciation & amortization)	41,548		9	%	38,081		10	%
Operations and technology (1) (6)	120,302		25	%	106,180		29	%
Selling, general, and administrative (1) (3) (5) (6)	160,738		34	%	123,689		34	%
Depreciation and amortization (2) (4)	26,351		6	%	12,086		3	%
Total operating expenses	535,949				425,768
Income (loss) from operations	(58,307)				(62,911)
Other Income (expense):
Interest income	7,410				12,505
Interest expense	(2,218)				(1,205)
Total other income (expense)	5,192				11,300
Income (loss) before income taxes	(53,115)				(51,611)
Provision for income taxes	448				409
Net income (loss)	$	(53,563)			$	(52,020)

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(1) Includes stock-based compensation expense as follows:	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023

	(in thousands)				(in thousands)
Marketplace and service cost of revenue (excluding depreciation & amortization)	$	294	$	282	$	753	$	684
Operations and technology	4,517		3,052		11,767		7,777
Selling, general, and administrative	13,449		9,521		35,535		27,801
Stock-based compensation expense	$	18,260	$	12,855	$	48,055	$	36,262

(2) Includes acquired intangible asset amortization as follows:	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023

	(in thousands)				(in thousands)
Depreciation and amortization	$	3,390	$	1,301	$	8,616	$	3,742

(3) Includes litigation-related costs as follows:	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023

	(in thousands)				(in thousands)
Selling, general, and administrative	$	—	$	—	$	1,553	$	—

(4) Includes amortization of capitalized stock based compensation as follows:	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023

	(in thousands)				(in thousands)
Depreciation and amortization	$	1,247	$	509	$	3,155	$	1,034

(5) Includes acquisition-related costs as follows:	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023

	(in thousands)				(in thousands)
Selling, general, and administrative	$	214	$	88	$	3,520	$	611

(6) Includes other adjustments as follows:	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023

	(in thousands)				(in thousands)
Operations and technology	$	46	$	—	$	46	$	(8)
Selling, general, and administrative	501		378		737		385
Other adjustments	$	547	$	378	$	783	$	377

Comparison of the three months ended September 30, 2024 and 2023

Revenue

Marketplace and Service Revenue


	Three months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Marketplace and service revenue	$	155,908	$	104,537	$	51,371	49	%

The increase was primarily driven by an increase in auction marketplace revenue from our buyers and sellers, as well as an increase in revenue earned from arranging for the transportation of vehicles to buyers. Revenue increases in the current quarter were primarily volume-driven and also buyer fee rates were higher for the three months ended September

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30, 2024 compared to the prior year period. For the three months ended September 30, 2024 compared to the three months ended September 30, 2023, auction marketplace revenue increased to $84.9 million from $51.5 million and other marketplace revenue increased to $62.7 million from $45.0 million. The increase in other marketplace revenue was primarily related to an increase in the revenue earned from the transportation of vehicles due to an increase in the number of units transported.

Customer Assurance Revenue


	Three months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Customer assurance revenue	$	15,421	$	14,477	$	944	7	%

The customer assurance revenue increase was mainly driven by an increase in Go Green assurance revenue, which was driven by an increase in units where customers elected the Go Green offering. For the three months ended September 30, 2024, Go Green assurance revenue increased to $13.5 million from $12.8 million in the three months ended September 30, 2023. Other assurance revenue increased to $1.9 million for the three months ended September 30, 2024 from $1.7 million for the three months ended September 30, 2023.

Operating Expenses

Marketplace and Service Cost of Revenue


	Three months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Marketplace and service cost of revenue (excluding depreciation & amortization)	$	67,064		$	47,928		$	19,136	40	%
Percentage of revenue	39		%	40		%

The increase primarily consisted of higher costs related to generating auction marketplace and other marketplace revenue. For the three months ended September 30, 2024 compared to the three months ended September 30, 2023, total cost attributed to generating auction marketplace revenue increased to $15.8 million from $9.6 million. The increase in auction marketplace cost of revenue is due to increased units sold through our marketplace and costs associated with our acquired remarketing centers' delivery of auction marketplace revenue. Other marketplace cost of revenues increased to $46.2 million for the three months ended September 30, 2024, compared to $33.3 million for the three months ended September 30, 2023, primarily due to an increase in the units transported to buyers from sellers. Marketplace and service costs of revenues as a percentage of revenue decreased during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 as we continued to grow revenue and scale our business.

Customer Assurance Cost of Revenue


	Three months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Customer assurance cost of revenue (excluding depreciation & amortization)	$	14,176		$	12,464		$	1,712	14	%
Percentage of revenue	8		%	10		%

The increase primarily consisted of costs attributable to our Go Green assurance offerings and was primarily driven by an increase in the number of arbitration claims, due to increased volume of completed auctions where the customer elected the Go Green offering and an increase in arbitration cost per unit sold. For the three months ended September 30, 2024 Go Green assurance cost of revenue increased to $12.9 million from $11.3 million in the three months ended September 30, 2023. Other assurance cost of revenue increased to $1.3 million for the three months ended September 30,

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2024, compared to $1.2 million for the three months ended September 30, 2023. Customer assurance cost of revenue as a percentage of revenue decreased during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 as we continued to manage arbitration costs and grow revenue.

Operations and Technology Expenses


	Three months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Operations and technology	$	42,539		$	35,132		$	7,407	21	%
Percentage of revenue	25		%	30		%

The increase is primarily due to higher personnel-related costs. For the three months ended September 30, 2024 compared to the three months ended September 30, 2023, personnel-related costs increased to $36.3 million from $29.7 million as a result of headcount increases and stock-based compensation in 2024. Software and technology costs increased to $4.2 million from $3.7 million in the three months ended September 30, 2024 compared to the three months ended September 30, 2023. Other expenses increased to $2.0 million from $1.8 million in the three months ended September 30, 2024 compared to the three months ended September 30, 2023. Operations and technology expense as a percentage of revenue decreased during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 as we continued our efforts to effectively manage costs while growing revenue.

Selling, General, and Administrative Expenses


	Three months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Selling, general, and administrative	$	54,973		$	40,797		$	14,176	35	%
Percentage of revenue	32		%	34		%

The increase is primarily due to higher personnel-related costs. For the three months ended September 30, 2024 compared to the three months ended September 30, 2023, personnel-related costs increased to $46.0 million from $33.7 million, primarily as a result of headcount increases and increased stock-based compensation in 2024. Non-personnel expenses increased to $9.0 million from $7.0 million in the three months ended September 30, 2024 compared to the three months ended September 30, 2023, as a result of increased facilities costs associated with our acquired remarketing centers and increased investment to support our future growth. Selling, general, and administrative expenses decreased as a percentage of revenue during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 as we continued our efforts to effectively manage costs while growing revenue.

Depreciation and Amortization


	Three months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Depreciation and amortization	$	9,716		$	4,980		$	4,736	95	%
Percentage of revenue	6		%	4		%

The increase is primarily due to an increase of $2.6 million in amortization of internal-use software costs along with an increase of $2.1 million in amortization related to acquired intangible assets. The increase in depreciation and amortization as a percentage of revenue is primarily due to the placing of internal-use software projects into service and the subsequent recognition of amortization expense as well as increased amortization costs related to intangible assets from recent acquisitions.

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Interest Income


	Three months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Interest income	$	2,050	$	4,489	$	(2,439)	(54)	%

The decrease was primarily driven by a lower balance in our marketable securities portfolio during the three months ended September 30, 2024 compared to the three months ended September 30, 2023. Marketable securities were sold during the nine months ended September 30, 2024 and the related proceeds were used to complete acquisitions.

Interest Expense


	Three months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Interest expense	$	(1,077)	$	(439)	$	(638)	145	%

The increase was primarily driven by debt issuance and other fees related to the Warehouse Facility during the three months ended September 30, 2024.

Provision for Income Taxes


	Three months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Provision for income taxes	$	(137)	$	1	$	(138)	—

Our effective tax rate was approximately 1% and 0% for the three months ended September 30, 2024 and 2023, respectively. The principal differences between the federal statutory rate and the effective tax rate are related to state taxes, foreign taxes and credits and the non-recognition of tax benefits for certain entities in a loss position for which a full valuation allowance has been recorded.

Comparison of the nine months ended September 30, 2024 and 2023

Revenue

Marketplace and Service Revenue


	Nine months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Marketplace and service revenue	$	429,848	$	318,760	$	111,088	35	%

The increase was primarily driven by an increase in auction marketplace revenue from our buyers and sellers, as well as increases in revenue earned from arranging for the transportation of vehicles to buyers. Revenue increases were primarily volume-driven and buyer fee rates were higher for the nine months ended September 30, 2024 compared to the prior year period. For the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, auction marketplace revenue increased to $227.7 million from $159.9 million and other marketplace revenue increased to $177.7 million from $134.3 million. The increase in other marketplace revenue was primarily related to an increase in the revenue earned from the transportation of vehicles due to an increase in the number of units transported.

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Customer Assurance Revenue


	Nine months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Customer assurance revenue	$	47,794	$	44,097	$	3,697	8	%

The customer assurance revenue increase was primarily driven by an increase in Go Green assurance revenue. For the nine months ended September 30, 2024, Go Green assurance revenue increased to $42.4 million from $39.3 million in the nine months ended September 30, 2023 driven by an increase in units that elected the Go Green offering and an increase in the fair value per unit sold that elected the Go Green offering year over year. Other assurance revenue increased to $5.4 million for the nine months ended September 30, 2024 from $4.8 million for the nine months ended September 30, 2023.

Operating Expenses

Marketplace and Service Cost of Revenue


	Nine months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Marketplace and service cost of revenue (excluding depreciation & amortization)	$	187,010		$	145,732		$	41,278	28	%
Percentage of revenue	39		%	40		%

The increase primarily consisted of higher costs related to generating auction marketplace and other marketplace cost of revenue. For the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, total cost attributed to generating auction marketplace revenue increased to $39.6 million from $26.9 million. The increase in auction marketplace cost of revenue is primarily due to increased units sold through our marketplace and costs associated with our acquired remarketing centers' delivery of auction marketplace revenue. Other marketplace cost of revenues increased to $131.8 million for the nine months ended September 30, 2024, compared to $102.2 million for the nine months ended September 30, 2023, primarily due to an increase in the units transported to buyers from sellers. Marketplace and services cost of revenues as a percentage of revenue decreased during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 as we continued to grow revenue and scale our business.

Customer Assurance Cost of Revenue


	Nine months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Customer assurance cost of revenue (excluding depreciation & amortization)	$	41,548		$	38,081		$	3,467	9	%
Percentage of revenue	9		%	10		%

The increase primarily consisted of costs attributable to our Go Green assurance offerings and was primarily driven by an increase in the number of arbitration claims, due to increased volume of completed auctions where the customer elected the Go Green offering. For the nine months ended September 30, 2024, Go Green assurance cost of revenue increased to $37.8 million from $34.3 million in the nine months ended September 30, 2023. Other assurance cost of revenue remained flat at $3.7 million during the nine months ended September 30, 2024 and the nine months ended September 30, 2023. Customer assurance cost of revenues as a percentage of revenue decreased during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 as we continued to manage arbitration costs and grow revenue.

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Operations and Technology Expenses


	Nine months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Operations and technology	$	120,302		$	106,180		$	14,122	13	%
Percentage of revenue	25		%	29		%

The increase primarily consisted of higher personnel expenses and related charges. For the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, personnel-related costs increased to $102.3 million from $89.7 million as a result of headcount increases and stock-based compensation in 2024. Software and technology expenses increased to $12.1 million from $11.6 million. Other expenses increased to $5.9 million from $4.9 million in the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. Operations and technology expense as a percentage of revenue decreased during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 as we continued our efforts to effectively manage costs while growing revenue.

Selling, General, and Administrative Expenses


	Nine months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Selling, general, and administrative	$	160,738		$	123,689		$	37,049	30	%
Percentage of revenue	34		%	34		%

The increase primarily consisted of higher personnel-related costs. For the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, personnel-related costs increased to $131.1 million from $103.2 million, primarily as a result of headcount increases and increased stock-based compensation in 2024. Non-personnel expenses increased to $29.6 million in the nine months ended September 30, 2024 from $20.5 million in the nine months ended September 30, 2023 as a result of increased facilities costs associated with our acquired remarketing centers and increased investment to support our future growth. Selling, general, and administrative expenses as a percentage of revenue decreased during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 as we continued our efforts to effectively manage costs while growing revenue.

Depreciation and Amortization


	Nine months ended September 30,						$ Change		% Change
	2024			2023
	(in thousands)
Depreciation and amortization	$	26,351		$	12,086		$	14,265	118	%
Percentage of revenue	6		%	3		%

The increase is primarily due to an increase of $9.4 million in amortization of internal-use software costs along with an increase of $4.9 million in amortization related to acquired intangible assets. The increase in depreciation and amortization as a percentage of revenue is primarily due to the placing of internal-use software projects into service and the subsequent recognition of amortization expense as well as increased amortization costs related to intangible assets from recent acquisitions.

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Interest Income


	Nine months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Interest income	$	7,410	$	12,505	$	(5,095)	(41)	%

The decrease was primarily driven by a lower balance in our marketable securities portfolio during the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. Marketable securities were sold during the nine months ended September 30, 2024 and the related proceeds were used to complete acquisitions.

Interest Expense


	Nine months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Interest expense	$	(2,218)	$	(1,205)	$	(1,013)	84	%

The increase was primarily driven by an increase in borrowings and debt issuance fees during the nine months ended September 30, 2024 as compared to the nine months ended September 30, 2023.

Provision for Income Taxes


	Nine months ended September 30,				$ Change		% Change
	2024		2023
	(in thousands)
Provision for income taxes	$	448	$	409	$	39	10	%

Our effective tax rate was approximately (1%) and (1%) for the nine months ended September 30, 2024 and 2023, respectively. The principal differences between the federal statutory rate and the effective tax rate are related to state taxes, foreign taxes and credits and the non-recognition of tax benefits for certain entities in a loss position for which a full valuation allowance has been recorded.

Non-GAAP Financial Measures

Adjusted EBITDA

We report our financial results in accordance with GAAP. However, management believes that Adjusted EBITDA, a non-GAAP financial measure, provides investors with additional useful information in evaluating our performance.

Adjusted EBITDA is a financial measure that is not presented in accordance with GAAP. We believe that Adjusted EBITDA, when taken together with our financial results presented in accordance with GAAP, provides meaningful supplemental information regarding our operating performance and facilitates internal comparisons of our historical operating performance on a more consistent basis by excluding certain items that may not be indicative of our business, results of operations or outlook. In particular, we believe that the use of Adjusted EBITDA is helpful to our investors as it is a measure used by management in assessing the health of our business and evaluating our operating performance, as well as for internal planning and forecasting purposes.

Adjusted EBITDA is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Some of these limitations include that: (i) it does not properly reflect capital commitments to be paid in the future; (ii) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and Adjusted EBITDA does not reflect these capital expenditures; (iii) it does not consider the impact of stock-based compensation expense; (iv) it does not reflect other non-operating income and expenses, including interest income and expense; (v) it

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does not consider the impact of any contingent consideration liability valuation adjustments; (vi) it does not reflect tax payments that may represent a reduction in cash available to us; and (vii) it does not reflect other one-time, non-recurring items, when applicable, such as acquisition-related and restructuring expenses. In addition, our use of Adjusted EBITDA may not be comparable to similarly titled measures of other companies because they may not calculate Adjusted EBITDA in the same manner, limiting its usefulness as a comparative measure. Because of these limitations, when evaluating our performance, you should consider Adjusted EBITDA alongside other financial measures, including our net loss and other results stated in accordance with GAAP.

The following table presents a reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable financial measure stated in accordance with GAAP, for the periods presented:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023

Net income (loss)	$	(16,029)	$	(18,238)	$	(53,563)	$	(52,020)
Depreciation and amortization	9,769		5,087		26,451		12,407
Stock-based compensation	18,260		12,855		48,055		36,262
Interest (income) expense	(973)		(4,050)		(5,192)		(11,300)
Provision for income taxes	(137)		1		448		409
Acquisition-related costs	214		88		3,520		611
Litigation-related costs (1)	—		—		1,553		—
Other	66		564		1,246		782
Adjusted EBITDA	$	11,170	$	(3,693)	$	22,518	$	(12,849)

(1) Litigation-related costs are related to an anti-competition case which we do not consider to be representative of our underlying operating performance

Non-GAAP Net income (loss)

We report our financial results in accordance with GAAP. However, management believes that Non-GAAP Net income (loss), a financial measure that is not presented in accordance with GAAP, provides investors with additional useful information to measure operating performance and current and future liquidity when taken together with our financial results presented in accordance with GAAP. By providing this information, we believe management and the users of the financial statements are better able to understand the financial results of what we consider to be our continuing operations.

We believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between our operating results from period to period. We exclude amortization of acquired intangible assets from the calculation of Non-GAAP Net income (loss). We believe that excluding the impact of amortization of acquired intangible assets allows for more meaningful comparisons between operating results from period to period as the underlying intangible assets are valued at the time of acquisition and are amortized over several years after the acquisition.

We exclude contingent consideration liability valuation adjustments associated with the purchase consideration of transactions accounted for as business combinations. We also exclude certain other one-time, non-recurring items, when applicable, such as acquisition-related and restructuring expenses, because we do not consider such amounts to be part of our ongoing operations nor are they comparable to prior periods nor predictive of future results.

Non-GAAP Net income (loss) is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Some of these limitations include that: (i) it does not consider the impact of stock-based compensation expense; (ii) although amortization is a non-cash charge, the underlying assets may need to be replaced and Non-GAAP Net income (loss) does not reflect these capital expenditures; (iii) it does not consider the impact of any contingent consideration liability valuation adjustments; and (iv) it does not consider the impact of other one-time charges, such as acquisition-related and restructuring expenses, which could be material to the results of our operations. In addition, our use of Non-GAAP Net income (loss) may not be comparable to similarly titled measures of other companies because they may not calculate Non-GAAP Net income (loss) in the same manner, limiting its usefulness as a

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comparative measure. Because of these limitations, when evaluating our performance, you should consider Non-GAAP Net income (loss) alongside other financial measures, including our net loss and other results stated in accordance with GAAP.

The following table presents a reconciliation of Non-GAAP Net income (loss) to net loss, the most directly comparable financial measure stated in accordance with GAAP, for the periods presented:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net income (loss)	$	(16,029)	$	(18,238)	$	(53,563)	$	(52,020)
Stock-based compensation	18,260		12,855		48,055		36,262
Amortization of acquired intangible assets	3,390		1,301		8,616		3,742
Amortization of capitalized stock based compensation	1,247		509		3,155		1,034
Acquisition-related costs	214		88		3,520		611

Litigation-related costs (1)	—		—		1,553		—
Other	547		378		783		378
Non-GAAP Net income (loss)	$	7,629	$	(3,107)	$	12,119	$	(9,993)

(1) Litigation-related costs are related to an anti-competition case which we do not consider to be representative of our underlying operating performance

Liquidity and Capital Resources

We have financed operations since our inception primarily through our marketplace revenue, proceeds from sales of equity securities, and debt facilities.

As of September 30, 2024, our principal sources of liquidity were cash and cash equivalents totaling $252.5 million, and investments in marketable securities totaling $35.2 million. We believe that our existing cash and cash equivalents, marketable securities, and cash flow from operations will be sufficient to support working capital and capital expenditure requirements for at least the next 12 months and for the long-term. Our future capital requirements over the long-term will depend on many factors, including volume of sales with existing customers, expansion of sales and marketing activities to acquire new customers, timing and extent of spending to support development efforts and introduction of new and enhanced services. We may, in the future, enter into arrangements to acquire or invest in complementary businesses, products, and technologies. We may be required to seek additional equity or debt financing. In the event that we require additional financing, we may not be able to raise such financing on terms acceptable to us or at all. If we are unable to raise additional capital or generate cash flows necessary to expand our operations and invest in continued innovation, we may not be able to compete successfully, which would harm our business, results of operations and financial condition.

As of September 30, 2024, our principal commitments primarily consist of long-term debt and leases for facilities. We have $3.7 million of lease obligations due within a year, and an additional $37.8 million of lease obligations due at various dates through 2038. Refer to Note 7, Leases, of our condensed consolidated financial statements.

In order to compete successfully and sustain operations at current levels over the next 12 months, we will be required to devote a significant amount of operating cash flow to our human capital in the form of salaries and wages. Additionally, we enter into purchase commitments for goods and services made in the ordinary course of business. These purchase commitments include goods and services received and recorded as liabilities as of September 30, 2024 as well as goods and services which have not yet been delivered or performed and have, therefore, not been reflected in our unaudited Condensed Consolidated Balance Sheets and unaudited Condensed Consolidated Statements of Operations. These commitments typically become due after the delivery and completion of such goods or services.

We settle transactions among buyers and sellers using the marketplace, and as a result the value of the vehicles passes through our balance sheet. Because our receivables typically have been, on average, settled faster than our payables, our cash position at each balance sheet date has been bolstered by marketplace float. Changes in working

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capital vary from quarter-to-quarter as a result of GMV and the timing of collections and disbursements of funds related to auctions completed near period end.

Our Debt Arrangements

2021 Revolver

We entered into a revolving credit facility with JP Morgan Chase Bank, N.A., or the 2021 Revolver, on August 24, 2021. On June 1, 2023, we entered into an Amendment on the 2021 Revolver which modified the rate at which interest payments are indexed from LIBOR to Secured Overnight Financing Rate ("SOFR"). On June 20, 2024, we entered into a Second Amendment on the 2021 Revolver, pursuant to which we, ACV Capital and ACV Capital Funding II LLC ("ACV Funding"), a wholly owned, bankruptcy-remote, special-purpose subsidiary of ACV Capital, were permitted to enter into the transactions contemplated by the Warehouse Facility. On October 7, 2024, we entered into Amendment No. 3 on the 2021 Revolver which allows us to make investments and other acquisitions (i) if Total Liquidity (as defined therein) immediately prior to the consummation of such investment or acquisition and after giving pro forma effect to such investment or acquisition is equal to or greater than $200.0 million, in an unlimited amount or (ii) if Total Liquidity immediately prior to the consummation of such investment or acquisition and after giving pro forma effect to such investment or acquisition is less than $200.0 million, in an amount not to exceed $25.0 million in the aggregate for any fiscal year of the Company.

The 2021 Revolver provides for a revolving line of credit in the aggregate principal amount of up to $160.0 million. The 2021 Revolver also includes a sub facility that provides for the issuance of letters of credit up to $20.0 million outstanding at any time. The 2021 Revolver is guaranteed by substantially all of our material domestic subsidiaries and is secured by substantially all of our and such subsidiaries’ assets except for ACV Capital receivables. The interest rate applicable to the 2021 Revolver is, at our option, either (a) SOFR (or a replacement rate established in accordance with the terms of the credit agreement for the 2021 Revolver) (subject to a 0.00% SOFR floor), plus a margin of 2.75% per annum plus an additional credit spread adjustment of 0.11% for daily and one-month terms, 0.26% for three-month terms and 0.43% for six-month terms or (b) the Alternate Base Rate plus a margin of 1.75% per annum. The Alternate Base Rate is the highest of (a) the Wall Street Journal prime rate, (b) the NYFRB rate plus 0.5% and (c)(i) 1.00% plus (ii) the adjusted SOFR rate for a one-month interest period. The 2021 Revolver has a maturity date of August 24, 2026. The 2021 Revolver contains customary covenants that limit our ability to enter into indebtedness, make distributions and make investments, among other restrictions. The 2021 Revolver also contains financial covenants that require us to maintain a minimum liquidity level and achieve specified trailing four quarter revenue targets. As of September 30, 2024, $48.5 million was drawn under the 2021 Revolver, and there were outstanding letters of credit issued under the 2021 Revolver in the amount of $3.3 million.

Warehouse Facility

On June 20, 2024, we entered into a revolving credit and security agreement, providing for a revolving warehouse facility (the "Warehouse Facility") with a maximum principal amount of $125.0 million. The revolving feature on the facility ends on June 20, 2026 and the facility matures twelve months later, unless sooner terminated or extended in accordance with its terms. The revolving credit facility was established to provide liquidity to fund new originations of auto floorplan loans by ACV Capital. The facility is secured by all assets of ACV Funding, including the auto floorplan loans owned by it.

We were in compliance with all such applicable covenants as of September 30, 2024, and believe we are in compliance as of the date of this Quarterly Report on Form 10-Q.

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Cash Flows from Operating, Investing, and Financing Activities

The following table shows a summary of our cash flows for the periods presented:


	Nine Months Ended September 30,
	2024		2023
Net cash provided by (used in) operating activities	$	68,616	$	8,611
Net cash provided by (used in) investing activities	12,314		(86,174)
Net cash provided by (used in) financing activities	(10,927)		23,052
Effect of exchange rate changes	(50)		(5)
Net increase (decrease) in cash and equivalents	$	69,953	$	(54,516)

Operating Activities

Our largest source of operating cash is cash collection from fees earned on our marketplace. Our primary uses of cash from operating activities are for personnel expenses, marketing expenses and overhead expenses.

In the nine months ended September 30, 2024 and 2023, net cash provided by operating activities was $68.6 million and $8.6 million, respectively. Net cash provided by operating activities during the nine months ended September 30, 2024 consisted primarily of an increase in accounts payable to sellers, offset by an increase in accounts receivable from buyers. In the nine months ended September 30, 2023 net cash provided by operating activities consisted primarily of an increase due to changes in our operating assets and liabilities and by non-cash charges, offset by our net loss. The increase in cash provided by operating activities during the nine months ended September 30, 2024 relative to the nine months ended September 30, 2023 is primarily due to the timing of collections and disbursements of funds related to auctions completed near period end.

Investing Activities

In the nine months ended September 30, 2024 net cash provided by investing activities was $12.3 million and in the nine months ended September 30, 2023, net cash used in investing activities was $(86.2) million. Net cash provided by investing activities during the nine months ended September 30, 2024 was primarily related to the sales/maturities of a portion of our marketable securities portfolio to support our business acquisition transactions and proceeds received from the sale of real estate, partially offset by business acquisitions and capitalized software development. Net cash used in investing activities during the nine months ended September 30, 2023 was primarily due to growth in our finance receivables portfolio, capitalized software development, and business acquisitions.

The increase in net cash provided by investing activities during the nine months ended September 30, 2024 relative to the nine months ended September 30, 2023 was primarily driven by greater cash inflows from maturities and sales of marketable securities and sales of real estate, offset by business acquisitions.

Financing Activities

In the nine months ended September 30, 2024 and 2023, net cash provided by (used in) financing activities was $(10.9) million and $23.1 million, respectively. Net cash provided by (used in) financing activities during the nine months ended September 30, 2024 relates to payments of RSU tax withholding net of proceeds from other equity plan activity. Net cash provided by (used in) in financing activities during the nine months ended September 30, 2023 related to proceeds, net of repayments, on long term debt, partially offset by payments of RSU tax withholding in exchange for common shares surrendered by RSU holders.

The decrease during the nine months ended September 30, 2024 relative to the nine months ended September 30, 2023 was primarily the result of lower proceeds from long term debt, net of repayments of long term debt during the period.

Acquisitions

We completed four business acquisitions during the nine months ended September 30, 2024. Purchase price allocations related to these acquisitions are subject to adjustments as they are finalized over the 12 month measurement

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period from the respective acquisition date. Goodwill acquired in connection with these acquisitions will be deductible for tax purposes in the United States and will be amortized on a straight-line basis over 15 years.

On January 30, 2024, we completed the acquisition of all of the ownership interests of Alliance Auto Auctions for estimated cash consideration of $66.9 million and 639,976 common shares of the Company's Class A common stock. The fair value of the consideration shares of $8.6 million was determined based upon the closing market price of the Company's Class A common shares on January 30, 2024. The aggregate purchase price was preliminarily allocated to $40.4 million of goodwill, $32.7 million of intangible assets, and $2.4 million of net assets assumed.

On March 8, 2024, we completed the acquisition of all of the ownership interests of a business (the "March 8, 2024 acquisition") for estimated cash consideration of $27.4 million. The aggregate purchase price was preliminarily allocated to $7.4 million of goodwill, $16.3 million of intangible assets, and $3.6 million of net assets assumed.

On March 13, 2024, we completed the acquisition of all of the ownership interests of a business (the "March 13, 2024 acquisition") for estimated cash consideration of $19.1 million. The aggregate purchase price was preliminarily allocated to $14.4 million of goodwill, $5.5 million of intangible assets, and $0.7 million of net liabilities assumed.

On June 17, 2024, we completed the acquisition of all of the ownership interest of a business (the "June 2024 acquisition") for estimated cash consideration of $51.6 million. The aggregate purchase price was preliminarily allocated to $11.4 million of goodwill, $18.7 million of intangibles, and $21.4 million of net assets assumed.

Seasonality

The volume of vehicles sold through our auctions generally fluctuates from quarter to quarter. This seasonality is caused by several factors, including holidays, weather, the seasonality of the retail market for used vehicles and the timing of federal tax returns, which affects the demand side of the auction industry. As a result, revenue and operating expenses related to volume will fluctuate accordingly on a quarterly basis. In the fourth quarter, we typically experience lower used vehicle auction volume as well as additional costs associated with the holidays. Seasonally depressed used vehicle auction volume typically continues during the winter months through the first quarter. Typical seasonality trends may not be observed in periods where other external factors more significantly impact the industry.

Critical Accounting Estimates

Our financial statements are prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosures. We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other assumptions that we believe are reasonable under the circumstances, however, our actual results could differ from these estimates.

There have been no material changes to our critical accounting estimates as compared to those disclosed in the Annual Report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are exposed to market risk in the ordinary course of our business. Market risk represents the risk of loss that may impact our financial position due to adverse changes in financial market prices and rates. Our market risk exposure is primarily the result of fluctuations in interest rates.

Interest Rate Risk

We had cash and cash equivalents of $252.5 million and marketable securities of $35.2 million as of September 30, 2024, which consisted of interest-bearing investments with maturities of three months or less and investment grade securities respectively. Interest-earning instruments carry a degree of interest rate risk as increases in rates will negatively affect the fair value of our marketable securities. We do not enter into investments for trading or speculative purposes and have not used any derivative financial instruments to manage our interest rate risk exposure. We had borrowings from banks of $115.0 million as of September 30, 2024. The interest rate paid on these borrowings is variable, indexed to SOFR. Therefore, increases in interest rates will increase the interest expense on these borrowings. A

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hypothetical 100 basis point change in interest rates would not result in a material impact on our condensed consolidated financial statements.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,” as defined in Rule 13a-15(e) and Rule 15d-15(e) under the Exchange Act, that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2024. Based on the evaluation of our disclosure controls and procedures as of September 30, 2024, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the period covered by this Quarterly Report on Form 10-Q that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives and are effective at the reasonable assurance level. However, management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the company have been detected. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

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PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time we may become involved in legal proceedings or be subject to claims arising in the ordinary course of our business. The material set forth in Note 5 (pertaining to information regarding legal contingencies) of the Notes of the Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q is incorporated herein by reference.

Item 1A. Risk Factors.

There have been no material changes to the risk factors previously disclosed in the Annual Report. Refer to the Annual Report for a complete discussion of our potential risks and uncertainties related to our business and on investment in our Class A common stock. The risks and uncertainties described in our Annual Report are not the only ones we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business. If any risks not specified in our Annual Report materialize, our business, financial condition and results of operations could be materially and adversely affected. See also “Special Note Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q for additional information.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(a)Recent Sales of Unregistered Equity Securities

Not applicable.

(b)Use of Proceeds

Not applicable.

(c)Issuer Purchases of Equity Securities

Not applicable.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

Our Section 16 officers (as defined in Rule 16a-1 under the Exchange Act) may from time to time enter into plans for the purchase or sale of ACV stock that are intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act.

During the quarter ended September 30, 2024, the following Section 16 officers adopted, modified, or terminated “Rule 10b5-1 trading arrangements” (as defined in Item 408 under Regulation S-K of the Exchange Act):

•On September 9, 2024, William Zerella, ACV's Chief Financial Officer, adopted a trading plan. Mr. Zerella’s trading plan provides for the sale of up to 140,000 shares. The first trade will not occur until January 7, 2025, at the earliest. Mr. Zerella's trading plan is scheduled to terminate on June 12, 2025.

•On September 9, 2024, Craig Anderson, ACV's Chief Corporate Development and Strategy Officer, put a modification letter in place modifying his September 15, 2023 plan. Mr. Anderson’s modification letter provides for the sale of up to 269,683 shares. The first trade will not occur until December 9, 2024, at the earliest. Mr. Anderson’s trading plan is scheduled to terminate on August 14, 2025.

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The Rule 10b5-1 trading arrangements described above were adopted and precleared in accordance with ACV’s Insider Trading Policy and actual sale transactions made pursuant to such trading arrangements will be disclosed publicly in future Section 16 filings with the SEC. Other than disclosed above, no other officer adopted, modified or terminated a Rule 10b5-1 trading arrangement or “non-Rule 10b5-1 trading arrangement” (as defined in Item 408 of Regulation S-K) during the three months ended September 30, 2024.

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Item 6. Exhibits.

Exhibit Number

Description

Form

File No.

Exhibit

Filing Date

Filed Herewith

3.1

Amended and Restated Certificate of Incorporation of the Registrant, as currently in effect.

8-K

001-40256

3.1

March 26, 2021

3.2

Amended and Restated Bylaws of the Registrant, as currently in effect.

8-K

001-40256

3.1

July 29, 2024

10.1

Amendment No. 3 , dated Octob er 7 , 2024, to Revolving Credit Agreement, dated as of August 24, 2021, among ACV Auctions Inc., the lenders party thereto and JPMorgan Chase Bank, N.A., as Administrative Agent.

31.1

Certification of Principal Executive Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

Certification of Principal Financial Officer pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*

Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2*

Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS

Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.

101.SCH

Inline XBRL Taxonomy Extension Schema Document

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

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101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

104

Cover Page Interactive Data File (embedded within the Inline XBRL document)

*This certification is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date hereof, regardless of any general incorporation language in such filing.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	ACV Auctions Inc.

Date: Nov 7, 2024	By:	/s/ George Chamoun
		George Chamoun
		Chief Executive Officer and Director

Date: Nov 7, 2024	By:	/s/ William Zerella
		William Zerella
		Chief Financial Officer

EXHIBIT 10.1

AMENDMENT NO. 3 dated as of October 7, 2024 (this “Amendment”) by and among ACV Auctions Inc., a Delaware corporation (the “Borrower”), each Lender party hereto (constituting the Required Lenders) (the “Consenting Lenders”) and JPMorgan Chase Bank, N.A. (“JPMorgan”), as Administrative Agent (in such capacity, the “Administrative Agent”) to the Revolving Credit Amendment dated as of August 24, 2021 (as amended, supplemented or otherwise modified from time to time prior to the date hereof, the “Credit Agreement” and, the Credit Agreement as amended hereby, the “Amended Credit Agreement”) among the Borrower, the Lenders from time to time party thereto, and JPMorgan, as Administrative Agent. Capitalized terms used herein and not otherwise defined herein have the meanings assigned to them in the Amended Credit Agreement.

RECITALS:

WHEREAS, pursuant to Section 9.02 of the Credit Agreement, the Borrower has requested that the Consenting Lenders and the Administrative Agent consent to amend the Credit Agreement as set forth in Section 1 hereof, and the Consenting Lenders are willing, on and subject to the terms and conditions hereof, to consent to such amendment;

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

Section 1.Amendments to the Credit Agreement. Subject to the satisfaction or waiver of the conditions set forth in Section 3 hereof, each of the parties hereto agrees that, effective on the Amendment No. 3 Effective Date (as defined below), Section 6.04(i) of the Credit Agreement is hereby amended and restated in its entirety as follows:

“so long as no Event of Default then exists or would result therefrom, the Borrower may make Investments and other acquisitions (i) if Total Liquidity immediately prior to the consummation of such Investment or acquisition and after giving pro forma effect to such Investment or acquisition is equal to or greater than $200,000,000, in an unlimited amount or (ii) if Total Liquidity immediately prior to the consummation of such Investment or acquisition and after giving pro forma effect to such Investment or acquisition is less than $200,000,000, in an amount not to exceed $25,000,000 in the aggregate for any fiscal year of the Borrower;”

Section 2.Representations and Warranties. The Borrower hereby represents and warrants to the Administrative Agent and each Lender as of the Amendment No. 3 Effective Date:

(a)The execution, delivery and performance by the Borrower of this Amendment is within the Borrower’s corporate powers and have been duly authorized by all necessary corporate action;

(b)The Borrower has duly executed and delivered this Amendment, and this Amendment constitutes its legal, valid and binding obligation, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law;

#99088557v6

(c)The execution, delivery and performance by the Borrower of this Amendment (a) does not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect and (ii) those approvals, consents, registrations, filings or other actions, the failure of which to obtain or make would not reasonably be expected to have a Material Adverse Effect, (b) except as would not reasonably be expected to have a Material Adverse Effect, will not violate any applicable law or regulation or any order of any Governmental Authority applicable to the Borrower, (c) will not violate the charter, by-laws or other organizational document of the Borrower or any of its Subsidiaries, (d) except as would not reasonably be expected to have a Material Adverse Effect, will not violate or result in a default under any indenture, agreement or other instrument (other than the agreements and instruments referred to in clause (c)) binding upon the Borrower or any of its Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by the Borrower or any of its Subsidiaries, and (e) will not result in the creation or imposition of any Lien on any asset of the Borrower or any of its Subsidiaries (other than liens arising pursuant to the Security Documents);

(d)The representations and warranties of the Borrower set forth in this Amendment, the Credit Agreement and the other Loan Documents are true and correct in all material respects on and as of the Amendment No. 3 Effective Date, except that (i) for purposes of this Section 2(d), (x) the representations and warranties contained in Section 3.04(a) of the Credit Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b) (subject, in the case of unaudited financial statements furnished pursuant to clause (b), to year-end audit adjustments and the absence of footnotes), respectively, of Section 5.01 of the Credit Agreement and (y) the representations and warranties contained in Section 3.14 of the Credit Agreement shall be deemed to refer to the Amendment No. 3 Effective Date, (ii) to the extent that such representations and warranties specifically refer to an earlier date, they shall be true and correct in all material respects as of such earlier date, and (iii) to the extent that such representations and warranties are already qualified or modified by materiality in the text thereof, they shall be true and correct in all respects; and

(e)As of the Amendment No. 3 Effective Date and immediately after giving effect to this Amendment and the transactions contemplated hereby, no Default or Event of Default shall have occurred and be continuing.

Section 3.Conditions to the Amendment No. 3 Effective Date. This Amendment shall become effective on the date (the “Amendment No. 3 Effective Date”) when (a) the Administrative Agent shall have received an executed counterpart (which may include a facsimile or other electronic transmission) of this Amendment from the Borrower, the Consenting Lenders party hereto (constituting Required Lenders) and the Administrative Agent, (b) the representations and warranties of the Borrower set forth in Section 2 hereof are true and correct as of the date hereof, (c) as of the date hereof and immediately after giving effect to this Amendment and the transactions contemplated hereby, no Default or Event of Default shall have occurred and be continuing and (d) the Administrative Agent shall have received all fees required to be paid by the Borrower on the Amendment No. 3 Effective Date, and all expenses required to be reimbursed by the Borrower for which invoices have been presented at least three Business Days prior to the Amendment No. 3 Effective Date, on or before the Amendment No. 3 Effective Date.

#99088557v6

Section 4.Effect of Amendment.

(a)Except as expressly set forth herein or in the Amended Credit Agreement, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders or the Administrative Agent under the Amended Credit Agreement, the Guaranty and Security Agreement or any other Loan Document, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants, Liens, guarantees or agreements contained in the Credit Agreement, the Guaranty and Security Agreement or any other Loan Document or any other provision of the Credit Agreement, the Guaranty and Security Agreement or of any other Loan Document. Except as expressly set forth herein, nothing herein shall be deemed to be a waiver, amendment, modification or other change of, any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement, the Guaranty and Security Agreement or any other Loan Document in similar or different circumstances.

(b)From and after the Amendment No. 3 Effective Date, each reference in the Credit Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of like import, and each reference to the “Credit Amendment” in any other Loan Document shall be deemed a reference to the Amended Credit Agreement. This Amendment shall constitute a “Loan Document” for all purposes of the Amended Credit Agreement and the other Loan Documents.

Section 5.Governing Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

Section 6.Costs and Expenses. The Borrower agrees to reimburse the Administrative Agent and each Consenting Lender for its actual and reasonable costs and expenses in connection with this Amendment to the extent required pursuant to Section 9.03 of the Amended Credit Agreement.

Section 7.Counterparts; Electronic Execution. This Amendment may be executed by one or more of the parties to this Amendment on any number of separate counterparts (including by email or telecopy), and all of said counterparts taken together shall be deemed to constitute one and the same instrument. In accordance with Section 9.06 of the Credit Agreement, delivery of an executed signature page or Electronic Signature to this Agreement by facsimile transmission or other electronic means shall be as effective as delivery of a manually signed counterpart of this Agreement.

Section 8.Headings. Section headings herein are included herein for convenience of reference only and shall not constitute a part hereof for any other purpose or be given any substantive effect.

Section 9.Incorporation by Reference. The provisions of Sections 9.09(b), (c) and (d) and 9.10 of the Amended Credit Agreement are hereby incorporated by reference, mutatis mutandis.

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Section 10.Severability. If any provision of this Amendment is held to be illegal, invalid or unenforceable, the legality, validity and enforceability of the remaining provisions of this Amendment shall not be affected or impaired thereby. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

[Remainder of page intentionally blank]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.


ACV AUCTIONS INC., as Borrower
By:
			Name:
			Title:


By:
			Name:
			Title:

[Signature Page to Amendment No. 3]

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JPMORGAN CHASE BANK, N.A., as Administrative Agent and a Lender
By:
			Name:
			Title:

[Signature Page to Amendment No.3]

[______________], as a Lender

By:
Name:
Title:

[Signature Page to Amendment No.3]

Exhibit 31.1

CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, George Chamoun, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of ACV Auctions Inc. (the "registrant") for the fiscal quarter ended September 30, 2024;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: Nov 7, 2024	By:	/s/ George Chamoun
		George Chamoun
		Chief Executive Officer and Director (Principal Executive Officer)

Exhibit 31.2

CERTIFICATION BY THE CHIEF FINANCIAL OFFICER PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, William Zerella, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of ACV Auctions Inc. (the "registrant") for the fiscal quarter ended September 30, 2024;

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.


Date: Nov 7, 2024	By:	/s/ William Zerella
		William Zerella
		Chief Financial Officer (Principal Financial Officer)

Exhibit 32.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of ACV Auctions Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2024 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.


Date: Nov 7, 2024	By:	/s/ George Chamoun
		George Chamoun
		Chief Executive Officer (Principal Executive Officer)

This certification accompanies the Quarterly Report, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of ACV Auctions Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (whether made before or after the date of the Quarterly Report on Form 10-Q), irrespective of any general incorporation language contained in such filing.

Exhibit 32.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.


Date: Nov 7, 2024	By:	/s/ William Zerella
		William Zerella
		Chief Financial Officer (Principal Financial Officer)

Cover - shares	9 Months Ended
Cover - shares	Sep. 30, 2024	Oct. 31, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2024
Document Transition Report	false
Entity File Number	001-40256
Entity Registrant Name	ACV Auctions Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	47-2415221
Entity Address, Address Line One	640 Ellicott Street, #321
Entity Address, City or Town	Buffalo
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	14203
City Area Code	800
Local Phone Number	553-4070
Title of 12(b) Security	Class A common stock, par value $0.001 per share
Trading Symbol	ACVA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001637873
Current Fiscal Year End Date	--12-31
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Common Stock Class A
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		158,276,243
Common Stock Class B
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		9,363,720

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Revenue:
Total revenue	$ 171,329	$ 119,014	$ 477,642	$ 362,857
Operating expenses:
Operations and technology	42,539	35,132	120,302	106,180
Selling, general, and administrative	54,973	40,797	160,738	123,689
Depreciation and amortization	9,716	4,980	26,351	12,086
Total operating expenses	188,468	141,301	535,949	425,768
Loss from operations	(17,139)	(22,287)	(58,307)	(62,911)
Other income (expense):
Interest income	2,050	4,489	7,410	12,505
Interest expense	(1,077)	(439)	(2,218)	(1,205)
Total other income (expense)	973	4,050	5,192	11,300
Loss before income taxes	(16,166)	(18,237)	(53,115)	(51,611)
(Benefit from) provision for income taxes	(137)	1	448	409
Net loss	$ (16,029)	$ (18,238)	$ (53,563)	$ (52,020)
Weighted-average shares - basic (in shares)	165,723,168	160,427,987	164,337,209	159,541,286
Weighted-average shares - diluted (in shares)	165,723,168	160,427,987	164,337,209	159,541,286
Net loss per share - basic (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)
Net loss per share - diluted (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)
Marketplace and service
Revenue:
Total revenue	$ 155,908	$ 104,537	$ 429,848	$ 318,760
Operating expenses:
Cost of revenue (excluding depreciation & amortization)	67,064	47,928	187,010	145,732
Customer assurance
Revenue:
Total revenue	15,421	14,477	47,794	44,097
Operating expenses:
Cost of revenue (excluding depreciation & amortization)	$ 14,176	$ 12,464	$ 41,548	$ 38,081

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Statement of Comprehensive Income [Abstract]
Net loss	$ (16,029)	$ (18,238)	$ (53,563)	$ (52,020)
Other comprehensive income (loss):
Net unrealized gains (losses) on available-for-sale securities	326	210	682	237
Foreign currency translation (loss) gain	1,121	(377)	678	(113)
Comprehensive loss	$ (14,582)	$ (18,405)	$ (52,203)	$ (51,896)

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Current Assets:
Cash and cash equivalents	$ 252,524	$ 182,571
Marketable securities	35,228	228,761
Trade receivables (net of allowance of $7,005 and $2,868)	203,728	164,009
Finance receivables (net of allowance of $3,557 and $3,428)	130,785	119,034
Other current assets	16,967	12,524
Total current assets	639,232	706,899
Property and equipment (net of accumulated depreciation of $4,615 and $4,462)	7,932	4,918
Goodwill	177,899	103,379
Acquired intangible assets (net of amortization of $26,235 and $17,534)	98,971	34,192
Capitalized software (net of amortization of $32,333 and $17,059)	66,249	55,771
Other assets	44,070	17,765
Total assets	1,034,353	922,924
Current Liabilities:
Accounts payable	385,696	305,845
Accrued payroll	15,044	12,245
Accrued other liabilities	21,502	15,851
Total current liabilities	422,242	333,941
Long-term debt	115,000	115,000
Other long-term liabilities	40,899	17,455
Total liabilities	578,141	466,396
Commitments and Contingencies
Stockholders' Equity:
Preferred Stock; $0.001 par value; 20,000,000 shares authorized; 0 and 0 shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	0	0
Additional paid-in capital	932,392	880,510
Accumulated deficit	(476,178)	(422,615)
Accumulated other comprehensive loss	(169)	(1,529)
Total stockholders' equity	456,212	456,528
Total liabilities and stockholders' equity	1,034,353	922,924
Common Stock Class A
Stockholders' Equity:
Common Stock	158	139
Common Stock Class B
Stockholders' Equity:
Common Stock	$ 9	$ 23

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Trade receivables allowance	$ 7,005	$ 2,868
Finance receivables allowance	3,557	3,428
Accumulated depreciation	4,615	4,462
Intangible assets amortization	26,235	17,534
Capitalized software amortization	$ 32,333	$ 17,059
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	20,000,000	20,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common Stock Class A
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	2,000,000,000	2,000,000,000
Common stock, shares issued (in shares)	157,720,580	138,637,352
Common stock, shares outstanding (in shares)	157,720,580	138,637,352
Common Stock Class B
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	160,000,000	160,000,000
Common stock, shares issued (in shares)	9,325,487	23,205,487
Common stock, shares outstanding (in shares)	9,325,487	23,205,487

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands	Total	Common Stock Class A	Common Stock Common Stock Class A	Common Stock Common Stock Class B	Additional Paid-In Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss
Balance at Dec. 31, 2022	$ 485,724		$ 121	$ 37	$ 836,695	$ (347,354)	$ (3,775)
Balance (in shares) at Dec. 31, 2022			121,214,275	37,241,952
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Conversion of Class B common stock to Class A common stock	0		$ 12	$ (12)
Conversion of Class B common stock to Class A common stocks (in shares)			12,269,282	(12,269,282)
Net loss	(52,020)					(52,020)
Other comprehensive income (loss)	124						124
Stock-based compensation	39,641				39,641
Exercise of common stock options	3,577		$ 1		3,576
Exercise of common stock options (in shares)			1,080,034
Vested restricted stock units	(11,279)		$ 1		(11,280)
Vested restricted stock units (in shares)			1,017,490	238,325
Issuance of shares for employee stock purchase plan	1,331		$ 1		1,330
Issuance of shares for employee stock purchase plan (in shares)		175,927
Balance at Sep. 30, 2023	467,098		$ 136	$ 25	869,962	(399,374)	(3,651)
Balance (in shares) at Sep. 30, 2023			135,757,008	25,210,995
Balance at Jun. 30, 2023	476,169		$ 135	$ 26	860,628	(381,136)	(3,484)
Balance (in shares) at Jun. 30, 2023			134,717,291	25,610,643
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Conversion of Class B common stock to Class A common stock	0		$ 1	$ (1)
Conversion of Class B common stock to Class A common stocks (in shares)			474,343	(474,343)
Net loss	(18,238)					(18,238)
Other comprehensive income (loss)	(167)						(167)
Stock-based compensation	13,176				13,176
Exercise of common stock options	802				802
Exercise of common stock options (in shares)			243,358
Vested restricted stock units	(4,644)				(4,644)
Vested restricted stock units (in shares)			322,016	74,695
Balance at Sep. 30, 2023	467,098		$ 136	$ 25	869,962	(399,374)	(3,651)
Balance (in shares) at Sep. 30, 2023			135,757,008	25,210,995
Balance at Dec. 31, 2023	456,528		$ 139	$ 23	880,510	(422,615)	(1,529)
Balance (in shares) at Dec. 31, 2023			138,637,352	23,205,487
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Conversion of Class B common stock to Class A common stock	0		$ 15	$ (15)
Conversion of Class B common stock to Class A common stocks (in shares)			14,710,017	(14,710,017)
Net loss	(53,563)					(53,563)
Other comprehensive income (loss)	1,360						1,360
Stock-based compensation	52,117				52,117
Issuance of shares for acquisitions	8,556		$ 1		8,555
Issuance of shares for acquisitions (in shares)			1,413,075
Exercise of common stock options	$ 8,644		$ 2	$ 1	8,641
Exercise of common stock options (in shares)	2,072,230		1,440,711	631,239
Vested restricted stock units	$ (19,428)		$ 1		(19,429)
Vested restricted stock units (in shares)			1,377,142	198,778
Issuance of shares for employee stock purchase plan	1,998				1,998
Issuance of shares for employee stock purchase plan (in shares)			142,283
Balance at Sep. 30, 2024	456,212		$ 158	$ 9	932,392	(476,178)	(169)
Balance (in shares) at Sep. 30, 2024			157,720,580	9,325,487
Balance at Jun. 30, 2024	457,617		$ 152	$ 14	919,216	(460,149)	(1,616)
Balance (in shares) at Jun. 30, 2024			151,659,441	14,370,258
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Conversion of Class B common stock to Class A common stock	0		$ 5	$ (5)
Conversion of Class B common stock to Class A common stocks (in shares)			5,106,981	(5,106,981)
Net loss	(16,029)					(16,029)
Other comprehensive income (loss)	1,447						1,447
Stock-based compensation	17,772				17,772
Exercise of common stock options	1,831		$ 1		1,830
Exercise of common stock options (in shares)			514,730
Vested restricted stock units	(6,426)				(6,426)
Vested restricted stock units (in shares)			439,428	62,210
Balance at Sep. 30, 2024	$ 456,212		$ 158	$ 9	$ 932,392	$ (476,178)	$ (169)
Balance (in shares) at Sep. 30, 2024			157,720,580	9,325,487

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023
Cash Flows from Operating Activities
Net income (loss)	$ (53,563)	$ (52,020)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization	26,451	12,407
Stock-based compensation expense, net of amounts capitalized	48,055	36,262
Provision for bad debt	8,161	8,530
Other non-cash, net	369	(772)
Changes in operating assets and liabilities, net of effects from purchases of businesses:
Trade receivables	(16,803)	10,990
Other operating assets	(2,168)	(5,266)
Accounts payable	55,684	(2,543)
Other operating liabilities	2,430	1,023
Net cash provided by (used in) operating activities	68,616	8,611
Cash Flows from Investing Activities
Net increase in finance receivables	(12,536)	(30,991)
Proceeds from sale of real estate	14,083	0
Purchases of property and equipment	(3,834)	(1,518)
Capitalization of software costs	(22,438)	(19,319)
Purchases of marketable securities	(21,607)	(116,036)
Maturities and redemptions of marketable securities	85,164	107,690
Sales of marketable securities	130,090	2,649
Acquisition of businesses (net of cash acquired)	(156,608)	(28,649)
Net cash provided by (used in) investing activities	12,314	(86,174)
Cash Flows from Financing Activities
Proceeds from long term debt	455,000	305,000
Payments towards long term debt	(455,000)	(275,500)
Payment of debt issuance costs	(1,966)	0
Proceeds from exercise of stock options	8,644	3,576
Payment of RSU tax withholdings in exchange for common shares surrendered by RSU holders	(19,537)	(11,280)
Proceeds from employee stock purchase plan	1,998	1,330
Other financing activities	(66)	(74)
Net cash provided by (used in) financing activities	(10,927)	23,052
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	(50)	(5)
Net increase (decrease) in cash, cash equivalents, and restricted cash	69,953	(54,516)
Cash, cash equivalents, and restricted cash, beginning of period	182,571	280,752
Cash, cash equivalents, and restricted cash, end of period	252,524	226,236
Non-cash investing and financing activities:
Stock-based compensation included in capitalized software development costs	3,869	2,394
Purchase of property and equipment and internal use software in accounts payable	$ 886	$ 1,277

Nature of Business and Summary of Significant Accounting Policies

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Nature of Business and Summary of Significant Accounting Policies


Accounting Standard Update	Description	Required date of adoption	Effect on consolidated financial statements
Accounting Standards Not Yet Adopted
Improvements to Reportable Segment Disclosures (ASU 2023-07)	The guidance amends reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.	December 31, 2024	The Company is currently evaluating the impact of this guidance and expects the adoption to result in additional disclosures in the notes to our consolidated financial statements.
Income Taxes (ASU 2023-09)	The guidance amends income tax disclosure requirements to provide information to better assess how an entity's operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. It requires annual disclosure of specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold.	December 31, 2025	The Company is currently evaluating the impact this guidance may have on the consolidated financial statements.

Financial Instruments

9 Months Ended

Sep. 30, 2024

Investments, Debt and Equity Securities [Abstract]

Financial Instruments

The following is a summary of available-for-sale financial instruments, as of September 30, 2024 and December 31, 2023, respectively (in thousands):


	September 30, 2024
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Marketable securities:
Corporate securities (1)	$	31,098	$	36	$	(89)	$	31,045
U.S. treasury and agency securities	4,177		6		—		4,183
Total Marketable securities	$	35,275	$	42	$	(89)	$	35,228
(1)Comprised primarily of corporate bonds


	December 31, 2023
	Amortized Cost		Unrealized Gain		Unrealized Losses		Fair Value
Cash equivalents:
Corporate securities (1)	$	1,213	$	—	$	(1)	$	1,212
Total cash equivalents	1,213		—		(1)		1,212
Marketable securities:
Corporate securities (1)	$	199,084	$	115	$	(819)	$	198,380
U.S. treasury and agency securities	30,404		25		(48)		30,381
Total Marketable securities	$	229,488	$	140	$	(867)	$	228,761
(1)Comprised primarily of corporate bonds and commercial paper

As of September 30, 2024, the fair values of available-for-sale financial instruments, by remaining contractual maturity, were as follows (in thousands):


Due within one year	$	28,491
Due in one to five years	6,737
Total	$	35,228

Fair Value Measurement

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurement

Level 1: Observable inputs such as quoted prices in active markets for identical assets and liabilities.

Level 2: Inputs other than the quoted prices in active markets that are observable either directly or indirectly.

Level 3: Unobservable inputs in which there is little or no market data which require the Company to develop its own assumptions.


	September 30, 2024
	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	83,971	$	—	$	—	$	83,971
Marketable Securities:
Corporate securities	—		31,045		—		31,045
U.S. treasury and agency securities	504		3,679		—		4,183
Total financial assets	$	84,475	$	34,724	$	—	$	119,199


	December 31, 2023
	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	22,433	$	—	$	—	$	22,433
Corporate securities	—		1,212		—		1,212
Marketable Securities:
Corporate securities	—		198,380		—		198,380
U.S. treasury and agency securities	20,064		10,317		—		30,381
Total financial assets	$	42,497	$	209,909	$	—	$	252,406

Accounts Receivables & Allowance for Doubtful Receivables

9 Months Ended

Sep. 30, 2024

Accounts Receivable, after Allowance for Credit Loss [Abstract]

Accounts Receivable & Allowance for Doubtful Receivables

Changes in the allowance for doubtful trade receivables for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Beginning balance	$	5,507	$	3,629	$	2,868	$	4,860
Provision for bad debt	2,271		2,046		5,048		5,325
Net write-offs
Write-offs	(1,082)		(3,254)		(2,197)		(11,442)
Recoveries	309		935		1,286		4,613
Net (write-offs) recoveries	(773)		(2,319)		(911)		(6,829)
Ending balance	$	7,005	$	3,356	$	7,005	$	3,356

Changes in the allowance for doubtful finance receivables for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Beginning balance	$	3,192	$	3,048	$	3,428	$	2,275
Provision for bad debt	835		677		3,113		3,205
Net write-offs
Write-offs	(528)		(1,148)		(3,338)		(3,300)
Recoveries	58		96		354		493
Net (write-offs) recoveries	(470)		(1,052)		(2,984)		(2,807)
Ending balance	$	3,557	$	2,673	$	3,557	$	2,673

Guarantees, Commitments and Contingencies	9 Months Ended
Guarantees, Commitments and Contingencies	Sep. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
Guarantees, Commitments and Contingencies	Guarantees, Commitments and Contingencies The Company provides certain guarantees to Sellers in the Marketplace in the ordinary course of business, which are accounted for under ASC 460 as a general guarantee. Vehicle Condition Guarantees – Sellers must attach a vehicle condition report in the Marketplace for every auction; this vehicle condition report is used by Buyers to inform bid decisions. The Company offers guarantees to Sellers in qualifying situations where the Company performed a vehicle inspection and prepared the vehicle condition report. Sellers must pay an additional fee in exchange for this guarantee. The guarantee provides Sellers protection from paying remedies to Buyers related to a Buyer’s claim that the vehicle condition report did not accurately portray the condition of the vehicle purchased on the Marketplace. The guarantee provides the Company with the right to retain proceeds from the subsequent liquidation of the vehicle covered under the guarantee. The guarantee is typically provided for 10 days after the successful sale of the vehicle on the Marketplace. The fair value of vehicle condition guarantees issued is estimated based on historical results and other qualitative factors. The vehicle condition guarantee revenue is recognized on the earlier of the guarantee expiration date or the guarantee settlement date. The maximum potential payment is the sale price of the vehicle. The total sale price of vehicles for which there was an outstanding guarantee was $213.8 million and $142.8 million at September 30, 2024 and December 31, 2023, respectively. The carrying amount of the liability presented in Accrued other liabilities was $1.6 million and $1.2 million at September 30, 2024 and December 31, 2023, respectively. The recognized probable loss contingency, in excess of vehicle condition guarantees recognized, presented in Accrued other liabilities was $1.8 million at September 30, 2024 and December 31, 2023. Other Price Guarantees – The Company provides Sellers with a price guarantee for vehicles to be sold on the Marketplace from time to time. If a vehicle sells below the guaranteed price, the Company is responsible for paying the Seller the difference between the guaranteed price and the final sale price. The term of the guarantee is typically less than one week. No material unsettled price guarantees existed at September 30, 2024 and December 31, 2023. Litigation – The Company and its subsidiaries are subject in the normal course of business to various pending and threatened legal proceedings and matters in which claims for monetary damages are asserted. On an on-going basis management, after consultation with legal counsel, assesses the Company's liabilities and contingencies in connection with such proceedings. For those matters where it is probable that the Company will incur losses and the amounts of the losses can be reasonably estimated, the Company records an expense and corresponding liability in its condensed consolidated financial statements. To the extent pending or threatened litigation could result in exposure in excess of the recorded liability, the amount of such excess is not currently estimable.

Borrowings	9 Months Ended
Borrowings	Sep. 30, 2024
Debt Disclosure [Abstract]
Borrowings	Borrowings 2021 Revolver On August 24, 2021, ACV Auctions Inc. entered into a revolving credit facility (the “2021 Revolver”). The 2021 Revolver was established to provide general financing to the Company. The 2021 Revolver is secured by substantially all of the Company's assets except for ACV Capital receivables. The maximum borrowing principal amount of the 2021 Revolver is $160.0 million and includes a sub facility that provides for the issuance of letters of credit up to $20.0 million outstanding at any time. On June 1, 2023, the Company entered into Amendment No. 1 (the "First Amendment"), which modified the rate to which interest payments are indexed to the Secured Overnight Financing Rate, or SOFR. The interest rate applicable to the 2021 Revolver is, at our option, either (a) SOFR (or a replacement rate established in accordance with the terms of the credit agreement for the 2021 Revolver) (subject to a 0.00% SOFR floor), plus a margin of 2.75% per annum plus an additional credit spread adjustment of 0.11% for daily and one-month terms, 0.26% for three-month terms and 0.43% for six-month terms or (b) the Alternate Base Rate plus a margin of 1.75% per annum. The Alternate Base Rate is the highest of (a) the Wall Street Journal prime rate, (b) the NYFRB rate plus 0.5% and (c)(i) 1.00% plus (ii) the adjusted SOFR rate for a one-month interest period. The First Amendment maintains a maximum borrowing principal amount of $160.0 million. On June 20, 2024, the Company entered into Amendment No. 2 (the "Second Amendment") to permit the Company, ACV Capital and ACV Capital Funding II LLC ("ACV Funding"), a wholly owned, bankruptcy-remote, special-purpose subsidiary of ACV Capital, to enter into the transactions contemplated by the Warehouse Facility. On October 7, 2024, the Company entered into Amendment No. 3 on the 2021 Revolver which allows the Company to make investments and other acquisitions (i) if Total Liquidity (as defined therein) immediately prior to the consummation of such investment or acquisition and after giving pro forma effect to such investment or acquisition is equal to or greater than $200.0 million, in an unlimited amount or (ii) if Total Liquidity immediately prior to the consummation of such investment or acquisition and after giving pro forma effect to such investment or acquisition is less than $200.0 million, in an amount not to exceed $25.0 million in the aggregate for any fiscal year of the Company. Refer to Note 9 contained in our Annual Report on Form 10-K for the year ended December 31, 2023 for further details and key terms regarding the 2021 Revolver. As of September 30, 2024 and December 31, 2023, outstanding borrowings under the 2021 Revolver were $48.5 million and $115.0 million, respectively, and there were outstanding letters of credit issued under the 2021 Revolver in the amount of $3.3 million and $2.1 million, respectively decreasing the availability under the 2021 Revolver by a corresponding amount. As of September 30, 2024, the interest rate on the outstanding borrowing was 9.75%. Warehouse Facility On June 20, 2024, ACV Funding entered into a revolving credit and security agreement, providing for a revolving warehouse facility (the "Warehouse Facility") with a maximum principal amount of $125.0 million. The Warehouse Facility was established to provide liquidity to fund new originations of auto floorplan loans by ACV Capital. The facility is secured by all assets of ACV Funding, including the auto floorplan loans owned by it. The revolving feature on the facility ends on June 20, 2026. The facility matures twelve months later, unless sooner terminated or extended in accordance with its terms. Advances under the Warehouse Facility funded by asset-backed commercial paper conduit through the issuance of commercial paper notes will bear interest generally at a rate equivalent to the weighted average annual rate of all commercial paper notes issued by the commercial paper conduit to fund its advances, plus a margin of 3.00%. Advances funded by lenders that are not commercial paper conduits, or by commercial paper conduits funded through means other than the issuance of commercial paper notes, will bear interest generally at a rate equal to (i) Term SOFR for a period of one-month (subject to a 0.00% floor), plus 0.11448% or, in certain circumstances, the Alternate Base Rate, plus (ii) a margin of 3.00%. The Alternate Base Rate is the highest of (a) the prime rate quoted in the Wall Street Journal, (b) the NYFRB rate plus 0.50% and (c)(i) 1.00% plus (ii) the Term SOFR rate for a one-month interest period. The interest rate may be increased under certain circumstances, including upon the occurrence of an early amortization event or event of default under the warehouse documentation. ACV Funding must also pay upfront any unused fees in connection with the facility. As of September 30, 2024 borrowings under the Warehouse Facility were $66.5 million with an interest rate of 8.21%. As of September 30, 2024, the Company was in compliance with all of its financial covenants and non-financial covenants.

Leases

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Leases

Maturities of lease liabilities as of September 30, 2024 were as follows (in thousands):


2024 (remaining)	$	1,921
2025	7,564
2026	7,350
2027	7,044
2028	6,794
Thereafter	35,486
Total lease payments	66,159
Less imputed interest	(24,801)
Total	$	41,358

The following amounts relate to operating leases that were recorded on the Company's Condensed Consolidated Balance Sheets at September 30, 2024 and December 31, 2023 (in thousands):


	September 30, 2024		December 31, 2023
Operating lease right of use assets:
Other assets	$	41,594	$	16,858
Operating lease liabilities:
Accrued other liabilities	3,627		1,647
Other long-term liabilities	37,731		15,034

Revenue

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Auction marketplace revenue	$	84,894	$	51,390	$	227,656	$	159,911
Other marketplace revenue	62,748		45,012		177,671		134,251
Data services revenue	8,266		8,135		24,521		24,598
Marketplace and service revenue	$	155,908	$	104,537	$	429,848	$	318,760

Stock-Based Compensation

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Stock-Based Compensation

Refer to Note 13 contained in our Annual Report on Form 10-K for the year ended December 31, 2023 for further details regarding our equity plans.

The following table summarizes the stock option activity for the nine months ended September 30, 2024 (in thousands, except for share and per share amounts):


	Number of Options	Weighted- Average Exercise Price Per Share		Intrinsic Value		Weighted- Average Remaining Contractual Term (in years)
Outstanding, December 31, 2023	6,296,350	$	2.49	$	79,728	4.83
Exercised	(2,072,230)	4.17
Forfeited	(4,032)	5.60
Expired	(23,839)	5.05
Outstanding, September 30, 2024	4,196,249	$	1.64	$	78,434	3.54
Exercisable, September 30, 2024	4,147,984	$	1.57	$	77,796	3.51

The following table summarizes the restricted stock unit and performance share unit activity for the nine months ended September 30, 2024 (in thousands, except for share and per share amounts):


	Number of RSUs	Weighted- Average Grant-Date Fair Value
Outstanding, December 31, 2023	7,237,920	$	14.37
Granted	4,745,687	$	17.45
Vested	(2,707,252)	$	14.79
Forfeited	(406,205)	$	15.02
Outstanding, September 30, 2024	8,870,150	$	15.84

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income TaxesThe Company had an effective tax rate of approximately 1% and 0% for the three months ended September 30, 2024 and 2023, and (1)% and (1)% for the nine months ended September 30, 2024 and 2023, respectively. The principal differences between the federal statutory rate and the effective tax rate are related to state taxes, foreign taxes and credits, and the non-recognition of tax benefits for certain entities in a loss position for which a full valuation allowance has been recorded.

Net Income (Loss) Per Share

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Net Income (Loss) Per Share


	Three months ended September 30,								Nine months ended September 30,
	2024				2023				2024				2023
	Class A		Class B		Class A		Class B		Class A		Class B		Class A		Class B
Numerator:
Net loss attributable to common stockholders	$	(14,734)	$	(1,295)	$	(15,327)	$	(2,911)	$	(47,932)	$	(5,631)	$	(42,540)	$	(9,480)
Denominator:
Weighted-average number of shares of common stock - Basic and diluted	152,333,761		13,389,407		134,822,341		25,605,646		147,060,846		17,276,363		130,464,809		29,076,477
Net loss per share attributable to common stockholders:
Basic and diluted	$	(0.10)	$	(0.10)	$	(0.11)	$	(0.11)	$	(0.33)	$	(0.33)	$	(0.33)	$	(0.33)


	Three months ended September 30,		Nine months ended September 30,
	2024	2023	2024	2023
Unvested RSUs and other awards	3,348,306	2,368,186	3,234,667	2,099,410
Stock options	4,049,296	5,428,444	4,497,191	5,477,646

Acquisitions

9 Months Ended

Sep. 30, 2024

Business Combinations [Abstract]

Acquisitions

June 2024 Acquisition

March 13, 2024 Acquisition

March 8, 2024 Acquisition

Alliance Auto Auctions

The aggregate purchase price for the Alliance Auto Auctions acquisition was preliminarily allocated to the assets and liabilities assumed as follows (in thousands):


Assets Acquired
Cash and cash equivalents	$	2,467
Trade receivables	14,926
Finance receivables	—
Other current assets	768
Property & equipment	892
Goodwill	40,391
Acquired intangible assets	32,700
Other assets	8,305
Total assets acquired	$	100,449
Liabilities Assumed
Accounts payable	$	15,040
Accrued payroll	400
Accrued other liabilities	2,132
Deferred revenue	64
Other long-term liabilities	7,362
Total liabilities assumed	24,998
Net assets acquired	$	75,451

Alliance Auto Auctions offers wholesale car auction services and enabled the Company to expand its range of offerings to dealers and commercial partners.

April 2023 Acquisition

August 2023 Acquisition

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Pay vs Performance Disclosure
Net loss	$ (16,029)	$ (18,238)	$ (53,563)	$ (52,020)

Insider Trading Arrangements	3 Months Ended	9 Months Ended
Insider Trading Arrangements	Sep. 30, 2024 shares	Sep. 30, 2024 shares
Trading Arrangements, by Individual
Non-Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Terminated	false
William Zerella [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On September 9, 2024, William Zerella, ACV's Chief Financial Officer, adopted a trading plan. Mr. Zerella’s trading plan provides for the sale of up to 140,000 shares. The first trade will not occur until January 7, 2025, at the earliest. Mr. Zerella's trading plan is scheduled to terminate on June 12, 2025.
Name	William Zerella
Title	Chief Financial Officer
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	September 9, 2024
Expiration Date	June 12, 2025
Arrangement Duration	156 days
Aggregate Available	140,000	140,000
Craig Anderson [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On September 9, 2024, Craig Anderson, ACV's Chief Corporate Development and Strategy Officer, put a modification letter in place modifying his September 15, 2023 plan. Mr. Anderson’s modification letter provides for the sale of up to 269,683 shares. The first trade will not occur until December 9, 2024, at the earliest. Mr. Anderson’s trading plan is scheduled to terminate on August 14, 2025.
Craig Anderson September 2024 Plan [Member] \| Craig Anderson [Member]
Trading Arrangements, by Individual
Name	Craig Anderson
Title	Chief Corporate Development and Strategy Officer
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	September 9, 2024
Expiration Date	August 14, 2025
Arrangement Duration	248 days
Aggregate Available	269,683	269,683
Craig Anderson September 2023 Plan [Member] \| Craig Anderson [Member]
Trading Arrangements, by Individual
Name	Craig Anderson
Title	Chief Corporate Development and Strategy Officer
Rule 10b5-1 Arrangement Terminated	true
Termination Date	September 9, 2024

Nature of Business and Summary of Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Nature of Business

Basis of Consolidation

Basis of Preparation

Recent Accounting Pronouncements


Accounting Standard Update	Description	Required date of adoption	Effect on consolidated financial statements
Accounting Standards Not Yet Adopted
Improvements to Reportable Segment Disclosures (ASU 2023-07)	The guidance amends reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.	December 31, 2024	The Company is currently evaluating the impact of this guidance and expects the adoption to result in additional disclosures in the notes to our consolidated financial statements.
Income Taxes (ASU 2023-09)	The guidance amends income tax disclosure requirements to provide information to better assess how an entity's operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. It requires annual disclosure of specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold.	December 31, 2025	The Company is currently evaluating the impact this guidance may have on the consolidated financial statements.

Nature of Business and Summary of Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2024

Accounting Policies [Abstract]

Schedule Of Accounting Standards Update and Change in Accounting Principle

The following table provides a description of accounting standards that are not yet adopted that could have an impact to the consolidated financial statements upon adoption.


Accounting Standard Update	Description	Required date of adoption	Effect on consolidated financial statements
Accounting Standards Not Yet Adopted
Improvements to Reportable Segment Disclosures (ASU 2023-07)	The guidance amends reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.	December 31, 2024	The Company is currently evaluating the impact of this guidance and expects the adoption to result in additional disclosures in the notes to our consolidated financial statements.
Income Taxes (ASU 2023-09)	The guidance amends income tax disclosure requirements to provide information to better assess how an entity's operations and related tax risks and tax planning and operational opportunities affect its tax rate and prospects for future cash flows. It requires annual disclosure of specific categories in the rate reconciliation and additional information for reconciling items that meet a quantitative threshold.	December 31, 2025	The Company is currently evaluating the impact this guidance may have on the consolidated financial statements.

Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2024

Investments, Debt and Equity Securities [Abstract]

Schedule of available-for-sale marketable securities

The following is a summary of available-for-sale financial instruments, as of September 30, 2024 and December 31, 2023, respectively (in thousands):


	September 30, 2024
	Amortized Cost		Unrealized Gains		Unrealized Losses		Fair Value
Marketable securities:
Corporate securities (1)	$	31,098	$	36	$	(89)	$	31,045
U.S. treasury and agency securities	4,177		6		—		4,183
Total Marketable securities	$	35,275	$	42	$	(89)	$	35,228
(1)Comprised primarily of corporate bonds


	December 31, 2023
	Amortized Cost		Unrealized Gain		Unrealized Losses		Fair Value
Cash equivalents:
Corporate securities (1)	$	1,213	$	—	$	(1)	$	1,212
Total cash equivalents	1,213		—		(1)		1,212
Marketable securities:
Corporate securities (1)	$	199,084	$	115	$	(819)	$	198,380
U.S. treasury and agency securities	30,404		25		(48)		30,381
Total Marketable securities	$	229,488	$	140	$	(867)	$	228,761
(1)Comprised primarily of corporate bonds and commercial paper

Schedule of fair values of available-for-sale financial instruments

As of September 30, 2024, the fair values of available-for-sale financial instruments, by remaining contractual maturity, were as follows (in thousands):


Due within one year	$	28,491
Due in one to five years	6,737
Total	$	35,228

Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2024

Fair Value Disclosures [Abstract]

Summary of financial assets measured at fair value on recurring basis


	September 30, 2024
	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	83,971	$	—	$	—	$	83,971
Marketable Securities:
Corporate securities	—		31,045		—		31,045
U.S. treasury and agency securities	504		3,679		—		4,183
Total financial assets	$	84,475	$	34,724	$	—	$	119,199


	December 31, 2023
	Level 1		Level 2		Level 3		Total
Cash equivalents:
Money market funds	$	22,433	$	—	$	—	$	22,433
Corporate securities	—		1,212		—		1,212
Marketable Securities:
Corporate securities	—		198,380		—		198,380
U.S. treasury and agency securities	20,064		10,317		—		30,381
Total financial assets	$	42,497	$	209,909	$	—	$	252,406

Accounts Receivables & Allowance for Doubtful Receivables (Tables)

9 Months Ended

Sep. 30, 2024

Accounts Receivable, after Allowance for Credit Loss [Abstract]

Summary of changes in the allowance for doubtful trade receivables

Changes in the allowance for doubtful trade receivables for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Beginning balance	$	5,507	$	3,629	$	2,868	$	4,860
Provision for bad debt	2,271		2,046		5,048		5,325
Net write-offs
Write-offs	(1,082)		(3,254)		(2,197)		(11,442)
Recoveries	309		935		1,286		4,613
Net (write-offs) recoveries	(773)		(2,319)		(911)		(6,829)
Ending balance	$	7,005	$	3,356	$	7,005	$	3,356

Summary of changes in the allowance for doubtful finance receivables

Changes in the allowance for doubtful finance receivables for the three and nine months ended September 30, 2024 and 2023 were as follows (in thousands):


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Beginning balance	$	3,192	$	3,048	$	3,428	$	2,275
Provision for bad debt	835		677		3,113		3,205
Net write-offs
Write-offs	(528)		(1,148)		(3,338)		(3,300)
Recoveries	58		96		354		493
Net (write-offs) recoveries	(470)		(1,052)		(2,984)		(2,807)
Ending balance	$	3,557	$	2,673	$	3,557	$	2,673

Leases (Tables)

9 Months Ended

Sep. 30, 2024

Leases [Abstract]

Schedule of maturities of lease liabilities

Maturities of lease liabilities as of September 30, 2024 were as follows (in thousands):


2024 (remaining)	$	1,921
2025	7,564
2026	7,350
2027	7,044
2028	6,794
Thereafter	35,486
Total lease payments	66,159
Less imputed interest	(24,801)
Total	$	41,358

Schedule of operating lease recorded on balance sheets

The following amounts relate to operating leases that were recorded on the Company's Condensed Consolidated Balance Sheets at September 30, 2024 and December 31, 2023 (in thousands):


	September 30, 2024		December 31, 2023
Operating lease right of use assets:
Other assets	$	41,594	$	16,858
Operating lease liabilities:
Accrued other liabilities	3,627		1,647
Other long-term liabilities	37,731		15,034

Revenue (Tables)

9 Months Ended

Sep. 30, 2024

Revenue from Contract with Customer [Abstract]

Summary of disaggregation of revenue


	Three months ended September 30,				Nine months ended September 30,
	2024		2023		2024		2023
Auction marketplace revenue	$	84,894	$	51,390	$	227,656	$	159,911
Other marketplace revenue	62,748		45,012		177,671		134,251
Data services revenue	8,266		8,135		24,521		24,598
Marketplace and service revenue	$	155,908	$	104,537	$	429,848	$	318,760

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2024

Share-Based Payment Arrangement [Abstract]

Summary of share-based payment arrangement

The following table summarizes the stock option activity for the nine months ended September 30, 2024 (in thousands, except for share and per share amounts):


	Number of Options	Weighted- Average Exercise Price Per Share		Intrinsic Value		Weighted- Average Remaining Contractual Term (in years)
Outstanding, December 31, 2023	6,296,350	$	2.49	$	79,728	4.83
Exercised	(2,072,230)	4.17
Forfeited	(4,032)	5.60
Expired	(23,839)	5.05
Outstanding, September 30, 2024	4,196,249	$	1.64	$	78,434	3.54
Exercisable, September 30, 2024	4,147,984	$	1.57	$	77,796	3.51

Summary of restricted stock unit activity

The following table summarizes the restricted stock unit and performance share unit activity for the nine months ended September 30, 2024 (in thousands, except for share and per share amounts):


	Number of RSUs	Weighted- Average Grant-Date Fair Value
Outstanding, December 31, 2023	7,237,920	$	14.37
Granted	4,745,687	$	17.45
Vested	(2,707,252)	$	14.79
Forfeited	(406,205)	$	15.02
Outstanding, September 30, 2024	8,870,150	$	15.84

Net Income (Loss) Per Share (Tables)

9 Months Ended

Sep. 30, 2024

Earnings Per Share [Abstract]

Schedule of basic and diluted net loss per share


	Three months ended September 30,								Nine months ended September 30,
	2024				2023				2024				2023
	Class A		Class B		Class A		Class B		Class A		Class B		Class A		Class B
Numerator:
Net loss attributable to common stockholders	$	(14,734)	$	(1,295)	$	(15,327)	$	(2,911)	$	(47,932)	$	(5,631)	$	(42,540)	$	(9,480)
Denominator:
Weighted-average number of shares of common stock - Basic and diluted	152,333,761		13,389,407		134,822,341		25,605,646		147,060,846		17,276,363		130,464,809		29,076,477
Net loss per share attributable to common stockholders:
Basic and diluted	$	(0.10)	$	(0.10)	$	(0.11)	$	(0.11)	$	(0.33)	$	(0.33)	$	(0.33)	$	(0.33)

Summary of potentially dilutive shares excluded from computation of net loss per share


	Three months ended September 30,		Nine months ended September 30,
	2024	2023	2024	2023
Unvested RSUs and other awards	3,348,306	2,368,186	3,234,667	2,099,410
Stock options	4,049,296	5,428,444	4,497,191	5,477,646

Acquisitions (Tables)

9 Months Ended

Sep. 30, 2024

Business Combinations [Abstract]

Schedule of recognized identified assets acquired and liabilities assumed

The aggregate purchase price for the Alliance Auto Auctions acquisition was preliminarily allocated to the assets and liabilities assumed as follows (in thousands):


Assets Acquired
Cash and cash equivalents	$	2,467
Trade receivables	14,926
Finance receivables	—
Other current assets	768
Property & equipment	892
Goodwill	40,391
Acquired intangible assets	32,700
Other assets	8,305
Total assets acquired	$	100,449
Liabilities Assumed
Accounts payable	$	15,040
Accrued payroll	400
Accrued other liabilities	2,132
Deferred revenue	64
Other long-term liabilities	7,362
Total liabilities assumed	24,998
Net assets acquired	$	75,451

Nature of Business and Summary of Significant Accounting Policies (Details)	9 Months Ended
	Sep. 30, 2024 industrySegment
Accounting Policies [Abstract]
Number of operating segments	1

Financial Instruments - Schedule of Available-for-Sale Financial Instruments (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Cash equivalents:
Amortized Cost	$ 252,524	$ 182,571
Marketable securities:
Amortized Cost	35,275	229,488
Unrealized Gains	42	140
Unrealized Losses	(89)	(867)
Fair Value	35,228	228,761
Corporate securities
Marketable securities:
Amortized Cost	31,098	199,084
Unrealized Gains	36	115
Unrealized Losses	(89)	(819)
Fair Value	31,045	198,380
U.S. treasury and agency securities
Marketable securities:
Amortized Cost	4,177	30,404
Unrealized Gains	6	25
Unrealized Losses	0	(48)
Fair Value	$ 4,183	30,381
Cash equivalents
Cash equivalents:
Amortized Cost		1,213
Unrealized Gain		0
Unrealized Losses		(1)
Fair Value		1,212
Corporate securities
Cash equivalents:
Amortized Cost		1,213
Unrealized Gain		0
Unrealized Losses		(1)
Fair Value		$ 1,212

Financial Instruments - Schedule of Fair Values of Available-for-Sale Financial Instruments (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Investments, Debt and Equity Securities [Abstract]
Due within one year	$ 28,491
Due in one to five years	6,737
Total	$ 35,228

Fair Value Measurement - Summary of Financial Assets Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	$ 35,228	$ 228,761
Total financial assets	119,199	252,406
Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	31,045	198,380
U.S. treasury and agency securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	4,183	30,381
Money market funds
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents	83,971	22,433
Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents		1,212
Level 1
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total financial assets	84,475	42,497
Level 1 \| Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	0	0
Level 1 \| U.S. treasury and agency securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	504	20,064
Level 1 \| Money market funds
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents	83,971	22,433
Level 1 \| Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents		0
Level 2
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total financial assets	34,724	209,909
Level 2 \| Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	31,045	198,380
Level 2 \| U.S. treasury and agency securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	3,679	10,317
Level 2 \| Money market funds
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents	0	0
Level 2 \| Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents		1,212
Level 3
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Total financial assets	0	0
Level 3 \| Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	0	0
Level 3 \| U.S. treasury and agency securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Marketable securities	0	0
Level 3 \| Money market funds
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents	$ 0	0
Level 3 \| Corporate securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Cash equivalents		$ 0

Accounts Receivables & Allowance for Doubtful Receivables - Summary of Changes in the Allowance for Doubtful Trade Receivables (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 5,507	$ 3,629	$ 2,868	$ 4,860
Provision for bad debt	2,271	2,046	5,048	5,325
Net write-offs
Write-offs	(1,082)	(3,254)	(2,197)	(11,442)
Recoveries	309	935	1,286	4,613
Net (write-offs) recoveries	(773)	(2,319)	(911)	(6,829)
Ending balance	$ 7,005	$ 3,356	$ 7,005	$ 3,356

Accounts Receivables & Allowance for Doubtful Receivables - Summary of Changes in the Allowance for Doubtful Finance Receivables (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Financing Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 3,192	$ 3,048	$ 3,428	$ 2,275
Provision for bad debt	835	677	3,113	3,205
Net write-offs
Write-offs	(528)	(1,148)	(3,338)	(3,300)
Recoveries	58	96	354	493
Net (write-offs) recoveries	(470)	(1,052)	(2,984)	(2,807)
Ending balance	$ 3,557	$ 2,673	$ 3,557	$ 2,673

Guarantees, Commitments and Contingencies (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2024	Dec. 31, 2023
Commitments And Contingencies [Line Items]
Guarantee term	10 days
Sale price of vehicles with outstanding guarantee	$ 213.8	$ 142.8
Carrying amount of the liability	1.6	1.2
Accrued Other Liabilities
Commitments And Contingencies [Line Items]
Recognized probable loss contingency	$ 1.8	$ 1.8

Borrowings (Details) - USD ($) $ in Millions	Jun. 20, 2024	Jun. 01, 2023	Aug. 24, 2021	Oct. 07, 2024	Sep. 30, 2024	Dec. 31, 2023
Revolving Credit Facility \| 2021 Revolver
Debt Instrument [Line Items]
Maximum borrowing principal amount			$ 160.0
SOFR floor		0.00%
Long-term line of credit					$ 48.5	$ 115.0
Outstanding letter of credit					$ 3.3	$ 2.1
Interest rate on outstanding borrowings					9.75%
Revolving Credit Facility \| 2021 Revolver \| Subsequent Event
Debt Instrument [Line Items]
Investment and acquisition liquidity requirement				$ 200.0
Maximum amount less than investment and acquisition liquidity requirement				$ 25.0
Revolving Credit Facility \| 2021 Revolver \| Secured Overnight Financing Rate
Debt Instrument [Line Items]
Basis spread on variable rate		2.75%
Revolving Credit Facility \| 2021 Revolver \| Secured Overnight Financing Rate \| Credit Spread Adjustment One
Debt Instrument [Line Items]
Credit spread adjustment		0.11%
Credit spread adjustment term		1 month
Revolving Credit Facility \| 2021 Revolver \| Secured Overnight Financing Rate \| Credit Spread Adjustment Two
Debt Instrument [Line Items]
Credit spread adjustment		0.26%
Credit spread adjustment term		3 months
Revolving Credit Facility \| 2021 Revolver \| Secured Overnight Financing Rate \| Credit Spread Adjustment Three
Debt Instrument [Line Items]
Credit spread adjustment		0.43%
Credit spread adjustment term		6 months
Revolving Credit Facility \| 2021 Revolver \| Base Rate
Debt Instrument [Line Items]
Basis spread on variable rate		1.75%
Interest rate		1.00%
Revolving Credit Facility \| 2021 Revolver \| NYFRB
Debt Instrument [Line Items]
Basis spread on variable rate		0.50%
Revolving Credit Facility \| First Amendment to Loan and Security Agreement
Debt Instrument [Line Items]
Maximum borrowing principal amount		$ 160.0
Revolving Credit Facility \| Warehouse Facility
Debt Instrument [Line Items]
SOFR floor	0.00%
Basis spread on variable rate	3.00%
Long-term line of credit					$ 66.5
Interest rate on outstanding borrowings					8.21%
Maximum principal amount	$ 125.0
Revolving Credit Facility \| Warehouse Facility \| Secured Overnight Financing Rate
Debt Instrument [Line Items]
Basis spread on variable rate	0.11448%
Credit spread adjustment term	1 month
Revolving Credit Facility \| Warehouse Facility \| Base Rate
Debt Instrument [Line Items]
Interest rate	1.00%
Revolving Credit Facility \| Warehouse Facility \| NYFRB
Debt Instrument [Line Items]
Basis spread on variable rate	0.50%
Revolving Credit Facility \| Warehouse Facility \| Asset-Backed Commercial Paper Conduit Weighted Average Annual Rate
Debt Instrument [Line Items]
Basis spread on variable rate	3.00%
Letter Of Credit
Debt Instrument [Line Items]
Maximum borrowing principal amount			$ 20.0

Leases - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Leases - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023	Dec. 31, 2023
Leases [Abstract]
Operating lease costs	$ 1.9	$ 1.0	$ 4.8	$ 1.8
Weighted-average remaining term	10 years 8 months 12 days		10 years 8 months 12 days		7 years 3 months 18 days
Weighted-average discount rate	10.00%		10.00%		5.00%
Right of use assets in exchange for new lease liabilities	$ 10.9	$ 9.6	$ 25.2	$ 15.3

Leases - Maturity of Lease Liabilities (Details) $ in Thousands	Sep. 30, 2024 USD ($)
Leases [Abstract]
2024 (remaining)	$ 1,921
2025	7,564
2026	7,350
2027	7,044
2028	6,794
Thereafter	35,486
Total lease payments	66,159
Less imputed interest	(24,801)
Total	$ 41,358

Leases - Leases Recorded on Balance Sheets (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Dec. 31, 2023
Operating lease right of use assets:
Other assets	$ 41,594	$ 16,858
Operating lease liabilities:
Accrued other liabilities	3,627	1,647
Other long-term liabilities	$ 37,731	$ 15,034

Revenue - Summary of Primary Components of Revenue, Level of Disaggregation (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Marketplace and service
Disaggregation Of Revenue [Line Items]
Revenue	$ 155,908	$ 104,537	$ 429,848	$ 318,760
Auction marketplace revenue
Disaggregation Of Revenue [Line Items]
Revenue	84,894	51,390	227,656	159,911
Other marketplace revenue
Disaggregation Of Revenue [Line Items]
Revenue	62,748	45,012	177,671	134,251
Data services revenue
Disaggregation Of Revenue [Line Items]
Revenue	$ 8,266	$ 8,135	$ 24,521	$ 24,598

Revenue - Narrative (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
Revenue - Narrative (Details) - USD ($) $ in Millions	Sep. 30, 2024	Sep. 30, 2024	Dec. 31, 2023
Disaggregation of Revenue [Abstract]
Contract liabilities	$ 5.2	$ 5.2	$ 4.2
Revenue recognized	$ 5.4	$ 4.2

Stock-Based Compensation - Summary of Stock Option Activity (Details) $ / shares in Units, $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2024 USD ($) $ / shares shares	Dec. 31, 2023 USD ($) $ / shares shares
Number of Options
Outstanding, beginning of period (in shares) \| shares	6,296,350
Exercised (in shares) \| shares	(2,072,230)
Forfeited (in shares) \| shares	(4,032)
Expired (in shares) \| shares	(23,839)
Outstanding, end of period (in shares) \| shares	4,196,249	6,296,350
Exercisable (in shares) \| shares	4,147,984
Weighted- Average Exercise Price Per Share
Outstanding, beginning of period (in dollars per share) \| $ / shares	$ 2.49
Exercised (in dollars per share) \| $ / shares	4.17
Forfeited (in dollars per share) \| $ / shares	5.60
Expired (in dollars per share) \| $ / shares	5.05
Outstanding, end of period (in dollars per share) \| $ / shares	1.64	$ 2.49
Exercisable (in dollars per share) \| $ / shares	$ 1.57
Intrinsic value, outstanding, beginning of period \| $	$ 79,728
Intrinsic value, outstanding, end of period \| $	78,434	$ 79,728
Intrinsic value, exercisable \| $	$ 77,796
Weighted average remaining contractual term, outstanding	3 years 6 months 14 days	4 years 9 months 29 days
Weighted average remaining contractual term, exercisable	3 years 6 months 3 days

Stock-Based Compensation - Summary of restricted stock unit (Details) - RSUs	9 Months Ended
	Sep. 30, 2024 $ / shares shares
Number of RSUs
Outstanding, beginning of period (in shares) \| shares	7,237,920
Granted (in shares) \| shares	4,745,687
Vested (in shares) \| shares	(2,707,252)
Forfeited (in shares) \| shares	(406,205)
Outstanding, end of period (in shares) \| shares	8,870,150
Weighted- Average Grant-Date Fair Value
Outstanding, beginning of period (in dollars per shares) \| $ / shares	$ 14.37
Granted (in dollars per share) \| $ / shares	17.45
Vested (in dollars per share) \| $ / shares	14.79
Forfeited (in dollars per share) \| $ / shares	15.02
Outstanding, end of period (in dollars per shares) \| $ / shares	$ 15.84

Stock-Based Compensation - Narrative (Details) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2024 USD ($)	Sep. 30, 2024 USD ($)	Mar. 31, 2024 agreement shares
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Number of contingently returnable share agreements \| agreement			2
2024 Agreements
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Weighted average period of recognized term		3 years 3 months 29 days
Common stock authorized (in shares) \| shares			773,099
Compensation expense related to unvested shares	$ 9.5	$ 9.5
Common Stock Options, Restricted Stock Units And Performance Share Units
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Compensation expense related to restricted stock	$ 122.5	$ 122.5
Weighted average period of recognized term		2 years 6 months
Performance Shares \| Share-Based Payment Arrangement, Tranche One
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting percentage	33.33%
Performance Shares \| Share-Based Payment Arrangement, Tranche Two
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting percentage	33.33%
Performance Shares \| Share-Based Payment Arrangement, Tranche Three
Share Based Compensation Arrangement By Share Based Payment Award [Line Items]
Vesting percentage	33.33%

Income Taxes (Details)	3 Months Ended		9 Months Ended
Income Taxes (Details)	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Income Tax Disclosure [Abstract]
Effective tax rate	1.00%	0.00%	(1.00%)	(1.00%)

Net Income (Loss) Per Share - Schedule of Basic And Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Denominator:
Weighted-average number of shares of common stock - basic (in shares)	165,723,168	160,427,987	164,337,209	159,541,286
Weighted-average number of shares of common stock - diluted (in shares)	165,723,168	160,427,987	164,337,209	159,541,286
Net loss per share attributable to common stockholders:
Basic (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)
Diluted (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)
Common Stock Class A
Numerator:
Net loss attributable to common stockholders	$ (14,734)	$ (15,327)	$ (47,932)	$ (42,540)
Denominator:
Weighted-average number of shares of common stock - basic (in shares)	152,333,761	134,822,341	147,060,846	130,464,809
Weighted-average number of shares of common stock - diluted (in shares)	152,333,761	134,822,341	147,060,846	130,464,809
Net loss per share attributable to common stockholders:
Basic (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)
Diluted (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)
Common Stock Class B
Numerator:
Net loss attributable to common stockholders	$ (1,295)	$ (2,911)	$ (5,631)	$ (9,480)
Denominator:
Weighted-average number of shares of common stock - basic (in shares)	13,389,407	25,605,646	17,276,363	29,076,477
Weighted-average number of shares of common stock - diluted (in shares)	13,389,407	25,605,646	17,276,363	29,076,477
Net loss per share attributable to common stockholders:
Basic (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)
Diluted (in dollars per share)	$ (0.10)	$ (0.11)	$ (0.33)	$ (0.33)

Net Income (Loss) Per Share - Summary of Potentially Dilutive Shares Excluded from Computation of Net Loss Per Share (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2024	Sep. 30, 2023	Sep. 30, 2024	Sep. 30, 2023
Unvested RSUs and other awards
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of diluted net loss per share (in shares)	3,348,306	2,368,186	3,234,667	2,099,410
Stock options
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of diluted net loss per share (in shares)	4,049,296	5,428,444	4,497,191	5,477,646

Acquisitions - Narrative (Details) $ in Thousands							9 Months Ended
Acquisitions - Narrative (Details) $ in Thousands	Jun. 17, 2024 USD ($)	Mar. 13, 2024 USD ($)	Mar. 08, 2024 USD ($)	Jan. 30, 2024 USD ($) shares	Aug. 22, 2023 USD ($)	Apr. 24, 2023 USD ($)	Sep. 30, 2024 USD ($) business	Sep. 30, 2023 business	Dec. 31, 2023 USD ($)
Business Acquisition [Line Items]
Number of businesses acquired \| business							4	2
Goodwill							$ 177,899		$ 103,379
The June 2024 Acquisition
Business Acquisition [Line Items]
Cash consideration	$ 51,600
Acquired cash	5,000
Payments to acquire real estate	14,100
Goodwill	11,400
Acquired intangible assets	18,700
Net assets (liabilities) assumed	$ 21,400
The March 13th, 2024 Acquisition
Business Acquisition [Line Items]
Cash consideration		$ 19,100
Goodwill		14,400
Acquired intangible assets		5,500
Net assets (liabilities) assumed		$ (700)
The March 8th, 2024 Acquisition
Business Acquisition [Line Items]
Cash consideration			$ 27,400
Goodwill			7,400
Acquired intangible assets			16,300
Net assets (liabilities) assumed			$ 3,600
Alliance Auto Auctions
Business Acquisition [Line Items]
Cash consideration				$ 66,900
Goodwill				40,391
Acquired intangible assets				$ 32,700
Consideration shares issued (in shares) \| shares				639,976
Fair value of consideration shares				$ 8,600
The April 2023 Acquisition
Business Acquisition [Line Items]
Cash consideration						$ 12,500
Goodwill						5,300
Acquired intangible assets						6,000
Net assets (liabilities) assumed						$ 1,200
The August 2023 Acquisition
Business Acquisition [Line Items]
Cash consideration					$ 16,900
Goodwill					6,200
Acquired intangible assets					14,200
Net assets (liabilities) assumed					$ (3,600)

Acquisitions - Assets and Liabilities Assumed (Details) - USD ($) $ in Thousands	Sep. 30, 2024	Jan. 30, 2024	Dec. 31, 2023
Assets Acquired
Goodwill	$ 177,899		$ 103,379
Alliance Auto Auctions
Assets Acquired
Cash and cash equivalents		$ 2,467
Trade receivables		14,926
Finance receivables		0
Other current assets		768
Property & equipment		892
Goodwill		40,391
Acquired intangible assets		32,700
Other assets		8,305
Total assets acquired		100,449
Liabilities Assumed
Accounts payable		15,040
Accrued payroll		400
Accrued other liabilities		2,132
Deferred revenue		64
Other long-term liabilities		7,362
Total liabilities assumed		24,998
Net assets acquired		$ 75,451