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VI

Vroom, Inc. (VRM)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 results reflected credit portfolio volatility: net loss from continuing operations widened to $(27.1)M from $(8.9)M in Q2 as realized/unrealized losses surged; adjusted net loss was $(25.7)M, with a $15.3M unfavorable mark-to-market on the fair value portfolio .
  • Liquidity improved quarter-over-quarter to $59.2M ($12.4M cash, $11.8M warehouse availability, $35.0M delayed draw facility); UACC warehouse capacity totals $600M with $270M drawn and $330M capacity remaining, a key funding backstop .
  • Operating discipline persisted: total expenses fell year-over-year (Q3 2025 $24.8M vs Q3 2024 $44.9M), while net interest after losses turned negative given higher portfolio losses and marks .
  • Management said full-year expectations align with the original adjusted net loss plan of ~$(56)M, with favorable Q1 marks now largely offset by unfavorable Q3 marks (interpret as maintaining internal plan rather than revising ranges) .
  • Stock narrative catalysts: credit performance assumptions and securitization marks, liquidity runway under warehouse facilities, and execution on UACC underwriting/collections and CarStory commercialization .

What Went Well and What Went Wrong

What Went Well

  • Expense control: total expenses down materially YoY (Q3 2025 $24.8M vs $44.9M in Q3 2024), reflecting restructuring benefits and cost efficiency .
  • Liquidity and funding access: total available liquidity rose to $59.2M QoQ; UACC retains $600M warehouse capacity, supporting originations and servicing activities .
  • Strategic execution: “our net loss and adjusted net loss decreased year-over-year, driven by our continued focus on our Long-Term Strategic Plan. During the third quarter, our team significantly improved our business intelligence engine and modernized our credit decision engine” — CEO Tom Shortt .

What Went Wrong

  • Credit loss pressure and marks: realized/unrealized losses jumped to $43.2M (from $19.5M in Q2), driving net interest after losses to $(11.7)M (vs $13.1M in Q2) .
  • Earnings deterioration QoQ: net loss from continuing operations expanded to $(27.1)M and diluted EPS to $(5.22), impacted by unfavorable fair value marks; adjusted net loss moved from $(6.7)M in Q2 to $(25.7)M in Q3 .
  • CarStory softness: revenue declined YoY and QoQ (Q3 2025 $1.35M vs Q2 2025 $1.85M and Q3 2024 $2.89M), with adjusted results near breakeven .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Interest income ($USD Millions)$50.21 $45.75 $44.83
Net interest income ($USD Millions)$34.87 $32.61 $31.51
Realized & unrealized losses, net of recoveries ($USD Millions)$38.35 $19.50 $43.20
Net interest income after losses ($USD Millions)$(3.48) $13.11 $(11.69)
Total noninterest income ($USD Millions)$10.72 $8.82 $9.51
Total expenses ($USD Millions)$44.86 $30.80 $24.82
Net loss from continuing operations ($USD Millions)$(37.74) $(8.93) $(27.14)
Diluted EPS – Continuing Ops ($USD)$(20.88) $(1.73) $(5.22)

Segment breakdown

Segment MetricQ3 2024Q2 2025Q3 2025
UACC – Interest income ($USD Millions)$50.80 $52.39 $44.83
UACC – Net interest after losses ($USD Millions)$5.34 $11.68 $(12.04)
UACC – Total noninterest income ($USD Millions)$5.27 $6.91 $5.83
UACC – Total expenses ($USD Millions)$33.62 $25.04 $20.69
UACC – Adjusted net loss ($USD Millions)$(19.86) $(5.33) $(25.78)
CarStory – Revenue ($USD Millions)$2.89 $1.85 $1.35
CarStory – Total noninterest income ($USD Millions)$3.09 $1.88 $1.38
CarStory – Total expenses ($USD Millions)$4.76 $4.22 $1.48
CarStory – Adjusted net income (loss) ($USD Millions)$(1.64) $0.12 $(0.07)
Corporate – Total noninterest income ($USD Millions)$2.37 $0.03 $2.30
Corporate – Total expenses ($USD Millions)$6.48 $3.99 $2.66

KPIs

KPIQ3 2024Q2 2025Q3 2025
Gross serviced portfolio ($USD Millions)$1,060 $998 $972
Indirect origination volume ($USD Millions)$100 $114 $107

Liquidity trend

MetricQ1 2025Q2 2025Q3 2025
Total available liquidity ($USD Millions)$66.9 $55.9 $59.2
Cash & cash equivalents ($USD Millions)$14.6 $14.3 $12.4
Stockholders’ equity ($USD Millions)$158.6 $151.9 $126.6

Non-GAAP reconciliation highlights (Q3 2025)

MetricQ3 2024Q2 2025Q3 2025
Net loss – continuing ops ($USD Millions)$(37.74) $(8.93) $(27.14)
Stock comp ($USD Millions)$1.24 $1.84 $1.44
Severance ($USD Millions)$0.76 $0.37 $0.00
Impairment ($USD Millions)$2.41 $0.00 $0.00
Adjusted net loss ($USD Millions)$(33.33) $(6.73) $(25.70)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted net loss ($USD Millions)FY 2025($30) – ($45) (May 14) “In line with original beginning-of-year plan of ~$(56)M; Q1 favorable mark-to-market now substantially offset by Q3 unfavorable” (Nov 10) Clarified vs internal plan; not explicitly updated range
Year-end total available liquidity ($USD Millions)FY 2025$35 – $50 (May 14) No update provided in Q3 materials Maintained (no update)
Indirect origination volume ($USD Millions)FY 2025$460 – $490 (May 14) No update provided in Q3 materials Maintained (no update)

Earnings Call Themes & Trends

Note: No Q3 2025 earnings call transcript was available; themes below draw on press releases and the Q3 presentation .

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q3 2025)Trend
Credit performance & marksQ1: improved portfolio performance; closed UACC 17th securitization; reduced adjusted loss . Q2: continued portfolio progress; adjusted loss narrowed QoQ .Unfavorable mark-to-market ($15.3M) drove loss expansion; net interest after losses negative .Deteriorated QoQ due to marks; YoY still improved adjusted TTM
Liquidity & fundingQ1: $66.9M liquidity; extended $400M warehouses . Q2: $55.9M liquidity .$59.2M liquidity; $600M total warehouse capacity; $330M remaining .Stable to improving QoQ
Cost disciplineQ1/Q2: operating expense reductions vs prior year .Total expenses down YoY; continued efficiency .Improving YoY
Technology/AI investmentsCarStory AI/data capabilities highlighted; systems investments .“Improved our business intelligence engine and modernized our credit decision engine” .Execution progressing
Business model focusPost-ecommerce exit; focus on UACC lending and CarStory services .Continued focus on long-term strategy and core assets .Consistent

Management Commentary

  • “In the third quarter of 2025, our net loss and adjusted net loss decreased year-over-year, driven by our continued focus on our Long-Term Strategic Plan. During the third quarter, our team significantly improved our business intelligence engine and modernized our credit decision engine.” — Tom Shortt, CEO .
  • “In the second quarter of 2025, our net loss and Adjusted net loss decreased year over year, driven by continued focus on operational execution, efficiency and progress in loan portfolio performance at UACC.” — Tom Shortt, CEO .
  • “We succeeded in executing UACC’s 17th securitization transaction, and we've extended $400 million of warehouse capacity since year end 2024… ended the quarter with total available liquidity of approximately $67 million.” — Jon Sandison, CFO (UACC) .

Q&A Highlights

  • No Q3 2025 earnings call transcript was available in our document set; therefore, Q&A highlights, guidance clarifications from live Q&A, and tone changes from prior calls are unavailable [List: earnings-call-transcript not found].

Estimates Context

  • S&P Global consensus EPS and revenue estimates for Q1–Q3 2025 were unavailable in our pull; as a result, we cannot quantify beats/misses vs Street for Q3 2025. Values retrieved from S&P Global.
  • Implication: Without consensus, investors should focus on internal trajectory—particularly the swing in realized/unrealized losses and fair value marks—when assessing forward estimate risk for credit costs and adjusted net loss .

Key Takeaways for Investors

  • Credit mark-to-market is the principal swing factor: Q3’s $15.3M unfavorable mark led to negative net interest after losses and widened EPS loss; watch securitization pricing and delinquency trends as near-term stock drivers .
  • Liquidity and funding capacity remain adequate: $59.2M available and $600M warehouse capacity (with $330M undrawn) provide operational runway, mitigating liquidity risk while credit metrics normalize .
  • Operating discipline is intact: expenses fell materially YoY; continued cost control provides cushion against loss volatility .
  • CarStory remains strategically relevant but currently sub-scale: revenue softness and near-breakeven adjusted results highlight need for commercialization and customer expansion .
  • Guidance signals alignment to internal plan rather than Street ranges: management references ~$(56)M adjusted net loss plan with Q1/Q3 marks offsetting; treat FY25 outcome sensitivity as tied to credit performance rather than Opex .
  • Near-term trading: expect high sensitivity to any disclosures on portfolio loss rates, securitization spreads/marks, and warehouse facility extensions; positive updates could drive relief rallies; negative marks could pressure shares .
  • Medium-term thesis: execution on underwriting/collections and AI-enabled decisioning at UACC, plus CarStory monetization, are key to stabilizing losses and moving toward sustainable profitability .