Growth in Mobility and Progress Toward Spin-Off Milestones
Mobility revenue increased 10%, with dealer revenue up 11%, driven by new products like CARFAX and automotiveMastermind.
The company is on track with its plan to spin off Mobility, with key milestones including internal carve-out, regulatory filings, and leadership appointments.
The CEO designate, Bill Eager, brings over 20 years of experience, and the transition is expected to be completed within 12-18 months.
Management highlighted the resilience of the business model despite macro uncertainties, and ongoing engagement with OEMs and manufacturers.
Management is reevaluating their portfolio composition in light of the upcoming Worldpay acquisition, considering assets that may no longer align with the new strategic focus.
The company has already exited or announced transactions to divest over $550 million of revenue, aligning with prior plans but now influenced by the Worldpay deal.
There is an emphasis on using proceeds from potential additional divestitures to return capital to shareholders, maintaining leverage neutrality.
The reevaluation includes assessing vertical market exposure and the potential for further asset monetization to optimize the business portfolio.
Management indicated that some decisions made before the acquisition are being revisited to better fit the combined company's long-term strategy.
The company aims to accelerate capital returns and streamline its assets to support the integration and growth post-Worldpay.
Peak Level of Business Engagement and Pipeline Growth
Management highlighted that active engagement count and gross revenue pipeline are at peak levels, indicating strong underlying demand despite some delays in transaction announcements.
Conversion of mandates into announced deals is taking longer due to financing challenges, valuation gaps, and cautious consumer behavior, but management remains confident in a broader acceleration of deal announcements.
Dafinchi