What changed in this filing

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Item 1A. Risk Factors

2026-02-26 compared with 2025-02-27 · 101 added, 92 removed, 302 unchanged (39% of the section changed)

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Our business is subject to risks related to the larger automotive ecosystem, including consumer demand, direct-to-consumer sales models and other macroeconomic issues.

Substantially all of our revenue is generated from subscription products offered to automotive dealers, OEMs and other customers in or adjacent to the automotive industry.

Substantially all of our revenue is generated from subscription products offered to automotive dealers and other customers in or adjacent to the automotive industry.

Our business may be negatively affected during times of low automobile sales, low dealer inventory due to production shortages or delays and high unemployment.

A number of economic and market conditions drive changes in automobile sales, including disruptions in the new automobile supply chain, the availability and prices of new and used automobiles, unemployment and inflation levels, availability of affordable financing, fluctuations in the cost of fuel, consumer confidence and other factors affecting demand for vehicles, government shutdowns, political unrest or uncertainty, the occurrence of contagious disease or illness, barriers to trade, new OEM entrants into markets and other global economic conditions.

A number of economic and market conditions drive changes in automobile sales, including disruptions in the new automobile supply chain, consumer demand for new vehicle models, the availability and prices of new and used automobiles, unemployment and inflation levels, availability of affordable financing, fluctuations in the cost of fuel, consumer confidence and other factors affecting demand for vehicles, government shutdowns, political unrest or uncertainty, the occurrence of contagious disease or illness, barriers to trade, new OEM entrants into markets and other global economic conditions.

Decreases in consumer demand could adversely affect the market for automobile purchases and, as a result, reduce the number of consumers using our platform.

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In addition, the imposition of new tariffs, quotas, duties, or other restrictions or limitations could increase prices for vehicles imported into the United States and adversely impact demand for such vehicles.

An increase in interest rates can have a significant impact on automobile purchases and affordability due to the direct relationship between interest rates and monthly loan payments, a critical factor for many consumers and the impact interest rates have on consumers’ borrowing capacity and disposable income.

Interest rates could negatively affect the number of vehicles purchased by consumers and any reduction in purchases could adversely affect dealers and OEMs and lead to a reduction in spending on our solutions.

Further, if OEMs continue to transition to e-commerce and direct-to-consumer sales models to grow their market penetration, consumer demand for our platform could be materially adversely affected with consumers shifting from our platform to an OEM-based platform.

In addition, a decrease in market demand caused by longer vehicle ownership , self-driving technology, ride sharing, transportation networks and other fundamental changes in transportation could impact the demand for new and used automobiles.

Disruptions in the new vehicle market can have delayed and prolonged effects on the used vehicle market, adversely affecting used vehicle availability, pricing and dealer inventory levels for several years following the initial disruption.

More recently, instability in electric vehicle manufacturing—including production delays, shifting OEM strategies and vehicle program cancellations—has created additional uncertainty for dealers and has contributed to inventory issues.

A reduction in the number of automobiles purchased by consumers could adversely affect automobile dealers and car manufacturers and consequently lead to reduced spending on our digital marketing services and solution offerings.

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Market acceptance of and influence over certain of our products and services is concentrated with a limited number of automobile OEMs, dealership associations and major dealership groups and we may not be able to maintain or grow these relationships.

Although the automotive retail industry is fragmented, a relatively small number of OEMs, dealership associations and major dealership groups and their program administrators exert significant influence over the market acceptance of certain automotive products and services due to their concentrated purchasing activity, the visibility of their endorsement or recommendation of specific products and services, their provision of co-operative advertising money to dealers and OEMs' ability to define technical standards and certifications and marketing guidelines.

Although the automotive retail industry is fragmented, a relatively small number of OEMs, dealership associations and their program administrators exert significant influence over the market acceptance of certain automotive products and services due to their concentrated purchasing activity, the visibility of their endorsement or recommendation of specific products and services, their provision of co-operative advertising money to dealers and OEMs' ability to define technical standards and certifications and marketing guidelines.

For example, many of our website solutions are provided pursuant to OEM-designated endorsements or preferred vendor programs.

While automotive dealers are generally free to purchase the solutions of their choosing, if an OEM has endorsed or certified a provider of products or services to its associated franchised dealers and if our solutions lack such certification or endorsement, adoption or retention of our products and services could be materially impaired.

In addition, instead of using Cars Commerce solutions, OEMs may begin to require that consumers and dealerships use OEM-created solutions which could also materially reduce the adoption or retention of our products and services.

In addition, instead of using our solutions, OEMs may begin to require that consumers and dealerships use OEM-created solutions which could also materially reduce the adoption or retention of our products and services.

Dealer closures or consolidation among dealers, major dealership groups or OEMs could reduce demand for, and negatively affect the pricing of, our marketing and solutions offerings, thereby leading to decreased earnings.

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Our business depends on our strong brand recognition, and any failure to maintain, protect and enhance our brands could hurt our ability to retain or expand our base of consumers, dealers and customers, and our ability to increase the frequency with which consumers, dealers and customers use our services.

We believe that maintaining and increasing the strong recognition of the Cars Commerce brands, including Cars.com, is critical to our future success.

We believe that maintaining and increasing the strong recognition of our brands, including Cars.com, is critical to our future success.

Our brand drives traffic to our websites and applications.

Our brand also attracts a large base of in-market car shoppers by offering credible and easy-to-understand information from other consumers and experts regarding new and used vehicle listings.

In addition, OEMs, dealers and other customers rely on our innovative digital marketing services and solution offerings to drive results in their businesses.

The Cars.com brand attracts a large base of in-market car shoppers by offering credible and easy-to-understand information from experts and other consumers regarding new and used vehicle listings.

The Cars.com website and its consumer audience is the starting point of our business flywheel.

Dealers, OEMs, and other customers rely on the strength of the Cars.com brand and the brand recognition of our innovative digital marketing services and solutions offerings to drive results for their businesses.

To grow our business, we must maintain, protect and enhance our brands.

Otherwise, we may be unable to expand our base of consumers and customers, or increase the frequency with which such constituents use or purchase our solutions.

Expanding the business will depend, in part, on our ability to maintain the consumer and customer trust in our solutions and services and the quality and integrity of the listings and other content found on the Cars.com sites and mobile applications.

Expanding the business will depend, in part, on our ability to maintain the consumer and customer trust in our solutions and services and the quality

and integrity of the listings and other content found on the Cars.com sites and mobile applications.

There is no guarantee that we can maintain or enhance our brands, and failure to do so would harm our business growth prospects and operating results.

integrity of the data that we provide to consumers, data privacy and security issues, third-party content and conduct on websites, customer service and other aspects of our business could diminish confidence in and the use of our services.

In addition, complaints or negative publicity about our business practices and culture, including our solutions, technologies, sales practices, management team, employees, our marketing and advertising campaigns, our compliance with applicable laws and regulations, the integrity of the data that we provide to consumers, data privacy and security issues, third-party content and conduct on websites, customer service and other aspects of our business could diminish confidence in and the use of our services.

If we experience negative publicity, or if consumers perceive that content on the Cars.com sites or mobile applications is not reliable, our reputation, the value of our brands and traffic to our sites and mobile applications could decline.

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and compliance with applicable foreign laws and regulations, including different data privacy, employment, commercial and liability standards and regulations and intellectual property laws.

Additionally, Cars Commerce is exposed to foreign currency risk, primarily from its investments in its subsidiaries that operate in Canada.

Our ability to successfully operate in Canada requires significant resources, given the different languages, cultures, legal systems and commercial infrastructures.

Additionally, we are exposed to foreign currency risk, primarily from its investments in its subsidiaries that operate in Canada.

Our ability to successfully operate in Canada requires resources, given the different languages, cultures, legal systems and commercial infrastructures.

Increased operations in Canada involve risks that could impact our operations and affect our business and potential growth.

For example, our competitors may be more established or otherwise better positioned than we are to succeed in Canada and have well established customer relationships, which would make it difficult to attract customers to our solutions.

We rely in part on Internet search engines and mobile application stores to drive traffic to the Cars Commerce sites and increase downloads of our mobile applications.

If the Cars Commerce sites and mobile applications fail to appear prominently in these search results, traffic to the Cars.com properties and mobile applications would decline and our business, results of operations or financial condition may be materially and adversely affected.

We depend, in part, on Internet search engines such as Google to drive traffic to the Cars Commerce sites.

For example, when a consumer searches for the make and model of a specific automobile or a generic phrase, such as "automobile prices," using an Internet search engine, we rely on a high organic search ranking of the Cars Commerce sites in these search results to drive consumer traffic.

The increased use, development and regulation of generative AI, including generative AI and agentic AI technologies, could materially and could materially and adversely affect our business, results of operations and financial condition.

AI technologies are rapidly evolving and increasingly being adopted by consumers, automotive manufacturers, dealers, our competitors, technology platforms and third-party service providers.

These technologies may significantly change how consumers search for, evaluate and purchase vehicles, how automotive advertising is delivered and measured and how digital marketplaces operate.

AI-powered search engines, digital assistants and other platforms may enable consumers to obtain vehicle information, pricing comparisons, dealer information, recommendations and purchasing guidance without visiting third-party marketplaces or websites.

If consumers increasingly rely on AI technologies that provide answers directly—rather than directing traffic to our websites or mobile applications—traffic to our platforms, lead volumes, advertising inventory and subscription value to dealers and OEMs could decline, which could materially adversely affect our revenue.

In addition, competitors, OEMs, dealers or other third parties may use AI to replicate, enhance or replace functionality currently provided by our platforms, including vehicle listings, pricing analysis, editorial content, lead generation tools and valuation products.

If we are unable to develop, deploy or integrate AI-enabled features at a pace that meets customer expectations, or if our AI-enabled solutions are perceived as less effective or less reliable than those of competitors, our competitive position, customer retention and growth prospects could be harmed.

AI systems may produce inaccurate, misleading or otherwise flawed outputs.

If AI-generated outputs are relied upon by consumers, dealers or OEMs and are perceived as unreliable or inconsistent with consumer and customer expectations, our reputation, brand value and customer relationships could be harmed.

The development and deployment of AI technologies also involve significant costs and risks.

Implementing AI-enabled solutions may require substantial investment in data infrastructure, computing resources, third-party technologies and specialized personnel, and such investments may not result in improved products, operational efficiencies or increased revenue.

The legal and regulatory environment governing AI is rapidly evolving.

Laws, including recently-enacted state laws, proposed laws and recent Executive Orders addressing regulation and policies related to AI may create inconsistent compliance obligations, which may be costly, challenging and difficult to resolve.

Existing laws and regulations relating to data privacy, intellectual property, consumer protection, advertising practices and algorithmic decision-making are also increasingly being interpreted or applied in new ways to AI-enabled products.

Compliance with such requirements could increase our costs, limit our ability to use data effectively or require changes to our products or business practices, or, if we fail to comply, it could expose us to fines, penalties and litigation.

If we are unable to effectively manage the operational, competitive, regulatory and reputational risks associated with AI, our business, financial condition and results of operations could be materially and adversely affected.

We rely in part on Internet search engines and mobile application stores to drive traffic to the Company's sites and increase downloads of our mobile applications.

If the Company's sites and mobile applications fail to appear prominently in these search results, traffic to the Cars.com properties and mobile applications would decline and our business, results of operations or financial condition may be materially and adversely affected.

We depend, in part, on Internet search engines to drive traffic to the Company's sites.

For example, when a consumer searches for the make and model of a specific automobile or a generic phrase, such as "used cars for sale near me," using an Internet search engine, we rely on a high organic search ranking of the Cars.com site in these search results to drive consumer traffic.

However, our ability to maintain these high search result rankings is not fully within our control.

For example, our competitors’ search engine optimization efforts may result in their websites receiving a higher search result page ranking than us, or Internet search engines could revise their methodologies in a way that would adversely affect our search result rankings.

In addition, Internet search engines, or new technologies, such as artificial intelligence platforms, could provide automobile dealer and pricing information directly in search results or choose to align with our competitors or develop competing services.

Cars Commerce sites have experienced both positive and negative fluctuations in search result rankings in the past, and it is anticipated that similar fluctuations will occur in the future.

We also depend in part on mobile application download stores such as the Apple App Store and Google Play to direct consumers to download Cars Commerce's mobile applications.

When a mobile device user searches in a mobile application store for "car buying app" or a similar phrase, we rely on both a high search ranking and consumer brand awareness to drive consumers to select and download Cars Commerce's mobile applications instead of those of our competitors.

However, our ability to maintain high, non-paid search result rankings in mobile application stores is not fully within our control.

Our competitors’ mobile application store search optimization efforts may result in their mobile applications receiving a higher result ranking than that of Cars Commerce, or mobile application download stores could revise their methodologies in a way that would adversely affect our search result rankings.

The emergence and widespread use of new technologies, such as artificial intelligence technologies, have the potential to significantly disrupt the way consumers access information.

Artificial intelligence-powered tools are increasingly enabling consumers to bypass traditional search engines to obtain information.

For example, our competitors’ search engine optimization efforts may result in their websites receiving a higher search result page ranking than us, or Internet search engines could revise their methodologies with or without knowledge in a way that would adversely affect our search result rankings.

The Company's sites have experienced both positive and negative fluctuations in search result rankings in the past, and it is anticipated that similar fluctuations will occur in the future.

Internet search engines or other platforms, including AI-powered search and answer engines, may provide vehicle information directly to consumers without referring them to our platforms.

Additionally, new technologies could affect how search results are ranked, or whether our search results appear at all, despite our search optimization efforts.

Consumer transition to such new technologies could adversely affect our search results or traffic to our mobile applications.

If Internet search engines or mobile application download stores modify their search algorithms, or if new developments in technology continue to evolve, such as generative artificial intelligence, in each case, in ways that negatively impact traffic to the Cars Commerce sites or Cars.com mobile applications, or if the search engine or mobile application store optimization efforts of our competitors are more successful than our own efforts, overall growth in our consumer base could slow or the consumer base could decline.

We rely on in-house content creation and development to drive organic traffic to the Cars Commerce sites and mobile applications.

If Internet search engines or mobile application download stores modify their search algorithms, or if new developments in technology continue to evolve, such as generative AI, in each case, in ways that negatively impact traffic to the Company's sites or Cars.com mobile applications, or if the search engine or mobile application store optimization efforts of our competitors are more successful than our own efforts, overall growth in our consumer base could slow or the consumer base could decline.

In addition, if search engines or app stores prioritize their own products or those of our competitors, or if AI-driven assistants become a primary navigation tool for consumers, traffic and conversion on our platforms could decline.

We rely on in-house content creation and development to drive organic traffic to the Company's sites and mobile applications.

We rely on our in-house editorial content team to continually develop content that is useful and of interest to consumers to drive organic traffic to the Cars.com properties and mobile applications.

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Decreased traffic from in-house content could also result in increased spend in paid channels, which would result in higher sales and marketing expenses.

Further, the increased adoption of generative artificial intelligence for content creation may impact how consumers value our editorial content and their need for our marketing services.

Further, the increased adoption of generative AI for content creation may impact how consumers value our editorial content and their need for our marketing services.

Any of the foregoing could materially and adversely affect our business, results of operations or financial condition.

Certain of our third-party service providers and customers are highly regulated financial institutions, and the federal and state laws related to financial services could have a direct or indirect materially adverse effect on our business.

In November 2021, we acquired the stock of CreditIQ, Inc., a privately held, automotive financial technology ("fintech") platform that provides instant online loan screening and approvals to facilitate online car buying.

In November 2021, we acquired the stock of CreditIQ, Inc., a privately held, automotive financial technology platform that provides instant online loan screening and approvals to facilitate online car buying.

Although we do not provide financial products, we have entered into agreements with partners and customers to provide a marketplace, automobile financing products to our consumers, including products that may involve a credit application or access to consumer credit scores.

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If our products or services are determined to fall within the scope of those laws or regulations, we or our partners may be required to implement new measures to comply with these laws and regulations, which could be costly, or be required to discontinue or limit the offering of certain products or services in affected jurisdictions.

Additionally, if our products or services are determined not to comply with relevant regulatory requirements, we or our partners could be subject to possibly significant civil and criminal penalties, including fines, or the award of significant damages in class action or civil litigation, as well as orders interfering with our ability to continue providing our products and services in certain jurisdictions.

Even without a determination that our products or services fall within the scope of these laws or regulations, if any of our current or prospective partners is uncertain about the applicability of those laws and regulations to our business, the partners may terminate their business with us, or we could have difficulty attracting new partners, which would adversely affect our future growth.

jurisdictions.

Even without a determination that our products or services fall within the scope of these laws or regulations, if any of our current or prospective partners are uncertain about the applicability of those laws and regulations to our business, the partners may terminate their business with us, or we could have difficulty attracting new partners, which would adversely affect our future growth.

Any or all of these adverse effects could result in substantial negative publicity, increased regulatory scrutiny, decreased revenues, increased expenses and decreased profitability.

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Our business may be affected by climate change, including physical risks and regulatory changes that may increase our operating costs and impact our ability to deliver services to our customers.

Climate change poses both physical and transitional risks to Cars Commerce, which may affect our operations, financial performance and reputation.

Cars Commerce conducted a climate risk assessment to better understand the types of climate-related risks that are most salient for our business.

Climate change poses both physical and transitional risks to our business, which may affect our operations, financial performance and reputation.

We conducted a climate risk assessment to better understand the types of climate-related risks that are most salient for our business.

This assessment reviewed our exposure to these risks as well as the systems in place to manage these risks.

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These include physical risks from extreme weather events such as floods, droughts, wildfires and storms, which can damage our assets and disrupt our operations.

Regulatory risks resulting from changes in laws and regulations on climate change may increase our compliance costs and limit our ability to operate.

Additionally, transition risks include the shift to a low-carbon economy which may affect the demand for our products and services.

Finally, reputational risks also exist related to the increased public scrutiny of our environmental impact and our response to climate change at the enterprise level.

Expectations relating to environmental, social and governance considerations expose Cars Commerce to potential liabilities, increased costs, reputational harm and other adverse effects on the Company’s business.

Many governments, regulators, investors, employees, customers and other stakeholders are increasingly focused on environmental, social and governance considerations relating to our business, including climate change and greenhouse gas ("GHG") emissions, human capital and diversity, equity and inclusion.

Cars Commerce makes statements about its environmental, social and governance goals and initiatives through information provided on its website, press releases and other communications.

Expectations relating to environmental, social and governance considerations expose us to potential liabilities, increased costs, reputational harm and other adverse effects on the Company’s business.

Some investors, employees, customers and other stakeholders are increasingly focused on environmental, social and governance considerations relating to our business, including climate change and greenhouse gas ("GHG") emissions, human capital and diversity, equity and inclusion.

We make statements about our environmental, social and governance goals and initiatives through information provided on our website, press releases and other communications.

Responding to these environmental, social and governance considerations and implementation of these goals and initiatives involves risks and uncertainties, requires investments, and are impacted by factors that may be outside our control.

In addition, some stakeholders may disagree with Cars Commerce’s goals and initiatives and the focus of stakeholders may change and evolve over time.

In addition, some stakeholders may disagree with our goals and initiatives and the focus of stakeholders may change and evolve over time.

Stakeholders also may have very different views on where environmental, social and governance focus should be placed, including differing views of regulators in various jurisdictions in which we operate.

Any failure, or perceived failure, by Cars Commerce to achieve its goals, further its initiatives, adhere to its public statements, comply with federal, state or international environmental, social and governance laws and regulations, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against Cars Commerce and materially adversely affect our business, reputation, results of operations, financial condition and stock price.

Any failure, or perceived failure, by the Company to achieve our goals, further its initiatives, adhere to its public statements, or meet evolving and varied stakeholder expectations and standards could result in legal and regulatory proceedings against the Company and materially adversely affect our business, reputation, results of operations, financial condition and stock price.

Strategic and Competitive Risks

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We may not be able to compete successfully against current or future competitors, and competitive pressures may materially and adversely affect our business, results of operations or financial condition.

We compete with other consumer automotive websites and mobile applications and other digital content providers for share of automotive-related digital display advertising spending and may be unable to maintain or grow our base of advertising customers or increase our revenue from existing customers.

Although the shift in advertising spending away from traditional advertising methods to digital advertising methods provides greater opportunity for us, competition to capture share of the total digital automotive advertising spend has increased and may continue to increase due to the attractive projected growth of digital automotive advertising spend, low barriers to entry in the online automotive marketplace and related digital automotive advertising markets.

We compete with other consumer automotive websites and mobile applications and other digital content providers for share of automotive-related digital advertising spending and may be unable to maintain or grow our base of advertising customers or increase our revenue from existing customers.

Competition to capture share of the total digital automotive advertising spend has increased and may continue to increase due to the attractive projected growth of digital automotive advertising spend, low barriers to entry in the online automotive marketplace and related digital automotive advertising markets.

We may face significant challenges in convincing our advertising customers, including national customers and OEMs, to expand their advertising on our sites and mobile applications in the face of growing competition, which could hurt our ability to grow our third-party advertising revenue.

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In addition, if we experience a significant decrease in advertising spending by OEMs or other national customers for any reason, our revenue will decrease and our business, results of operations or financial condition may be materially and adversely affected.

If we do not adapt to automated buying strategies, our display advertising revenue could be adversely affected.

If we do not adapt to automated buying strategies, our display revenue could be adversely affected.

The majority of the OEM display advertising purchased by our national, regional and related customers (e.g., insurance and finance customers) is still done manually via insertion orders.

However, customers have recently shifted away from buying media directly from premium publishers and increasingly are buying their target audiences via ad exchanges across the broader Internet.

While we have grown our programmatic revenue, are developing new programmatic ad products, and are redesigning our ad delivery technology stack, we may not adapt quickly enough and may lose display advertising revenue as a result.

While we are developing new programmatic ad products and have redesigned our ad delivery technology stack, we may not adapt quickly enough and may lose display advertising revenue as a result.

Due to the concentrated number of OEM and national customers, our OEM and national advertising business can be materially impacted by shifts in media strategy, marketing strategies, agency changes and our customer’s financial results.

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We may also be unable to successfully implement effective cost controls or achieve expected synergies as a result of an acquisition.

Acquisitions may result in our assumption of unexpected liabilities, the integration of separate organizations, the unanticipated incompatibility of systems and operating methods, negative impacts on employee morale and performance as a result of job changes and reassignments, unforeseen difficulties in operating businesses we have not operated before and the diversion of management’s attention from the operation of our core business.

Acquisitions may result in our assumption of unexpected liabilities, the integration of separate organizations, the

unanticipated incompatibility of systems and operating methods, negative impacts on employee morale and performance as a result of job changes and reassignments, unforeseen difficulties in operating businesses we have not operated before and the diversion of management’s attention from the operation of our core business.

Acquisitions may also result in greater exposure to the industry risks of the businesses underlying the acquisition and possible tax costs and inefficiencies.

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In addition, we may not be able to successfully integrate acquired businesses, which may result in an inability to realize the anticipated benefits of our acquisitions.

In November 2021, we acquired CreditIQ, a privately held, automotive fintech platform that provides instant online loan screening and approvals to facilitate online car buying.

In March 2022, we completed the acquisition of certain assets and assumed certain liabilities of AccuTrade, Galves Market Data and MADE Logistics (collectively, "AccuTrade"), which added real-time, VIN-specific appraisal and valuation data, instant guaranteed offer capabilities and logistics technology to our portfolio of dealer offerings.

Continued achievement of our transaction synergies and our ability to grow the AccuTrade and CreditIQ businesses and the revenue associated with it depend on a number of factors, including, but not limited to successfully integrating AccuTrade and CreditIQ into the Cars Commerce platform and solution offerings, expanding dealer and consumer adoption, securing lenders who will pay for lead generation and dealers honoring pre-approved loans.

If our anticipated transaction synergies do not fully materialize and/or the AccuTrade or CreditIQ businesses fails to continue to grow at the rate we expect, our revenue and business would be harmed.

On November 1, 2023, we acquired D2C Media, a leading automotive technology and digital solutions provider in Canada and on January 23, 2025, we acquired Dealer Club, Inc.

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If we raise additional funds through future issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our common stock.

Future equity financings could also decrease our earnings per share and the benefits derived from such new ventures or acquisitions might not outweigh or exceed their dilutive effect.

Future equity financings could also decrease our net income per share and the benefits derived from such new ventures or acquisitions might not outweigh or exceed their dilutive effect.

Any additional debt financing we secure could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital or to pursue business opportunities.

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The failure to complete an upgrade or enhancement as planned, or an unexpected result of a technology upgrade, could affect the security or availability of our products and services and could lead to loss of traffic, customers and revenue.

A cybersecurity incident or other disruption could also trigger enhanced regulatory scrutiny and disclosure obligations, including under SEC cybersecurity incident reporting requirements, and could result in reputational harm, litigation, enforcement actions, remediation costs, business interruption and loss of revenue.

Additionally, our reliance on third-party cloud, hosting, communications, payments and other service providers increases the risk that a disruption, outage or security incident at a third party could adversely affect our operations, and we may have limited ability to control or remediate such incidents.

Although we have undertaken measures intended to protect the safety and security of our information technology systems and the information technology systems of our third-party providers and the data therein, there can be no assurance that disruptions, failures and cybersecurity incidents will not occur or, if they do occur, that they will be adequately addressed in a timely manner.

Our business is dependent on keeping pace with advances in technology.

If we are unable to keep pace with advances in technology, consumers and customers may stop using our services and our revenue may decrease.

The Internet and electronic commerce are characterized by rapid technological change, changes in consumer and customer requirements and expectations, frequent new service and product introductions incorporating new technologies, including mobile applications, generative artificial intelligence and the emergence of new industry standards and practices that could render our existing sites, mobile applications and technology obsolete.

These market characteristics are intensified by the emerging nature of the market and the fact that many companies are expected to introduce new products and services in the near future.

The Internet and electronic commerce are characterized by rapid technological change, changes in consumer and customer requirements and expectations, frequent new service and product introductions incorporating new technologies, including mobile applications, generative AI and the emergence of new industry standards and practices that could render our existing sites, mobile applications and technology obsolete.

These market characteristics are intensified by the emerging nature of the market and the fact that many companies

are expected to introduce new products and services in the near future.

If we are unable to adapt to changing technologies, our business, results of operations or financial condition may be materially and adversely affected.

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We also partner with social media platforms, such as Facebook and Instagram, to leverage our valuable audience data to serve native advertisements and display real-time inventory for both dealers and OEMs to in-market car shoppers.

If the third parties are unable or unwilling to provide data or services, restrict our use of data, experience difficulty meeting our requirements or standards, or revoke or fail to renew our licenses or partnerships, we could have difficulty operating key aspects of our business.

ability to provide our products to consumers and customers until a comparable provider is identified or until we develop replacement technology or operations.

Third party service providers may develop, acquire or integrate products or services that compete directly with our solutions or reduce the need for customers to use our platforms.

If the third parties bundle competing functionality into their core offerings, restrict access to APIs or integrations, are unable or unwilling to provide data or services, modify licensing terms, increase pricing, restrict our use of data, experience difficulty meeting our requirements or standards, or revoke or fail to renew our licenses or partnerships, we could have difficulty operating key aspects of our business.

In addition, if these third-party service providers were to cease operations, temporarily or permanently, face financial distress or other business disruption or increase their fees, or if our relationship with these providers were to deteriorate, we could suffer increased costs and delays in our ability to provide our products to consumers and customers until a comparable provider is identified or until we develop replacement technology or operations.

We rely on third-party services to track and calculate certain of our key metrics, including unique visitors and traffic, and any errors or interruptions in the services or data they provide or any failure to maintain these relationships could harm our business.

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In addition, although we use technology designed to block low quality traffic, we may not be able to prevent all such traffic, and such technology may have the effect of blocking some valid traffic.

Further, consumers may have the ability to change privacy settings and opt-out of certain features, which could reduce the quality of data we receive.

Further, consumers may have the ability to change privacy settings and opt-out of certain features and/or website tracking, which could reduce the quality of data we receive.

For these and other reasons, our traffic and unique visitor metrics may not accurately reflect the number of people actually using our platform.

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Like other technology-based businesses, our platform may be subject to attacks from computer viruses, break-ins, phishing attacks, ransomware attacks, unauthorized use, attempts to overload services with denial-of-service and other attacks.

Any attack or disruption could negatively impact our ability to attract new consumers, dealers or customers and could deter current consumers, dealers or customers from using our solutions, or subject us to lawsuits, regulatory fines or other action or liability.

Any cybersecurity threat, incident or disruption could negatively impact our ability to attract new consumers, dealers or customers and could deter current consumers, dealers or customers from using our solutions, or subject us to lawsuits, regulatory investigations and fines or other action or liability.

• Availability:

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We process, store, share and disclose certain limited personal information and other data provided by consumers, dealers and OEMs, including names, addresses and certain location information used in geo-fencing.

Failure to protect consumer or customer data or to provide consumers or customers with appropriate notice of our privacy practices, could negatively impact our reputation and competitive position, and could result in litigation with third parties, and liabilities imposed by federal and state regulatory agencies or courts.

In addition, we could be subject to evolving laws and regulatory standards that impose data use obligations, data breach notification requirements, specific data security obligations, restrictions on solicitation or other consumer privacy-related requirements.

Failure to protect consumer or customer data, to comply with applicable laws or regulations or to provide consumers or customers with appropriate notice of our privacy practices, could negatively impact our reputation and competitive position, and could result in litigation with third parties, and liabilities imposed by federal and state regulatory agencies or courts.

• Data Protection (Internal):

We process and store company information that may be considered sensitive or valuable intellectual property in the normal operations of human resources, finance, legal, marketing, software development, product management, mergers and acquisitions and other business functions.

Failure to protect sensitive company information or

intellectual property may result in loss of competitive advantage, reputation damage, direct and indirect costs and other liabilities.

Failure to protect sensitive company information or intellectual property may result in loss of competitive advantage, reputation damage, direct and indirect costs and other liabilities.

Failure to protect material financial information including financial performance and merger and acquisition data could also subject us to liabilities imposed by federal and state regulatory agencies or courts.

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We also depend on the security of our networks and partially on the security of our third-party service providers.

Although we believe that our resiliency planning and security controls are appropriate to our exposures to system outages, service interruptions, security incidents and breaches, there is no guarantee that these plans and controls will prevent all such incidents.

Although we believe that our resiliency planning and security controls are appropriate to our exposures to system outages, service interruptions, cybersecurity incidents and threats, there is no guarantee that these plans and controls will prevent all such incidents.

Techniques used to disable or degrade service or gain unauthorized access to systems or data change frequently and may not be recognized until damage is detected.

We maintain cyber risk insurance, but this insurance may not be sufficient to cover all losses from any future disruption, security incident or breach.

We maintain cyber risk insurance, but this insurance may not be sufficient to cover all losses from any future disruption or cybersecurity incident, or that such insurance will continue to be available on terms acceptable to us.

Despite our resiliency planning and security controls, if our technology systems, or those of our third-party providers, are damaged, breached, interrupted, or cease to function properly for any reason, and, if our resiliency planning and security controls do not effectively resolve the incident on a timely basis, we may suffer interruptions in our ability to manage or conduct business and we may be exposed to reputational, competitive and business harm as well as litigation and regulatory action, which may materially and adversely impact our business, financial condition, or results of operations.

If the use of third-party cookies or other tracking technologies is rejected by Internet browsers or service providers or users, restricted, blocked, or subject to unfavorable laws or regulations, the amount of Internet user information would decrease, which may harm our business and operating results.

If the use of third-party cookies or other tracking technologies is rejected by Internet browsers or service providers or users, restricted or blocked, or subject to unfavorable laws or regulations, the amount of Internet user information would decrease, which may harm our business and operating results.

Digital advertising relies on the ability to uniquely identify devices across websites and applications and to collect data about user interactions to attribute.

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We provide consumers the ability to adjust their settings with respect to the use and deployment of third-party cookies on their devices.

The most commonly used Internet browsers—Chrome, Firefox and Safari—allow Internet users to modify their browser settings to block third-party cookies.

The most commonly used Internet browsers—Chrome, Firefox and Edge—allow Internet users to modify their browser settings to block third-party cookies.

Additionally, some browsers currently, or may in the future, block or limit some third-party cookies by default or may implement user control settings that block or limit some cookies.

Some Internet users also download free or paid ad-blocking software that prevents third-party cookies from being stored on a user’s computer.

Mobile devices using Android and iOS operating systems limit the ability of cookies, or similar technology, to track consumers while they are using applications other than their web browser on the device.

In addition, state, federal and international governmental authorities continue to evaluate the privacy implications inherent in the use of cookies and other tracking technologies and have enacted or are considering enacting laws or regulations that could significantly restrict the ability of companies to use third-party cookies and other online tracking technologies.

Increased restriction of the use of third-party cookies and other tracking technologies and any decline of cookies or similar online tracking technologies as a means to identify and potentially target users, could limit our ability to effectively retain existing customers or acquire new customers, reduce the efficacy of our off-site marketing solutions and consequently, materially adversely affect our business, financial condition and operating results.

The largest mobile operating systems are iOS and Android, and both impose limitations on the ability of cookies or similar technologies to track consumers.

In addition, Apple introduced changes to its iOS operating system that require users to affirmatively opt in to allow applications to track their activity for advertising purposes.

A significant number of users have elected to disable such tracking, which

has inhibited our ability to retarget users who access our mobile applications and have opted out of ad tracking and limited our ability to attribute advertising performance across devices and platforms.

Courts, too, have evaluated privacy-related implications associated with website tracking technologies, often allowing litigants to pursue legal action (including in the form of class actions) under certain wiretapping statutes when individuals have not consented to such tracking.

Increased restriction of the use of third-party cookies and other tracking technologies and any decline of cookies or similar online tracking technologies as a means to identify and potentially target users, as well as business decisions made in response to litigation risks associated with the use of certain tracking technologies and practices, could limit our ability to effectively retain existing customers or acquire new customers, reduce the efficacy of our off-site marketing solutions and consequently, materially adversely affect our business, financial condition and operating results.

Our ability to attract and retain customers depends on our ability to collect and use data and develop tools to enable us to effectively deliver and accurately measure advertisements on our platform.

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Our business could be significantly affected by different interpretations or applications of existing laws or regulations, future laws or regulations, including changes to the corporate tax rate or actions or rulings by judicial or regulatory authorities.

Our operations may be subject to adoption, expansion or interpretation of various laws and regulations, and compliance with these laws and regulations may require us to obtain licenses at an undeterminable and possibly significant expense.

Our operations may be subject to adoption, expansion or interpretation of various laws and regulations, and compliance with these laws and regulations may be challenging and could even require us to obtain licenses at an undeterminable and possibly significant expense.

Similarly, state tax authorities could take aggressive positions as to whether certain of our products are subject to sales and use taxes, leading to increased tax exposure.

These additional expenditures may materially and adversely affect our future results of operations, whether directly through increasing future overhead or indirectly by forcing us to pass on these additional costs to our customers, making our solutions less competitive.

These additional expenditures may materially and adversely affect our future results of operations,

whether directly through increasing future overhead or indirectly by forcing us to pass on these additional costs to our customers, making our solutions less competitive.

There can be no assurances that future laws or regulations or interpretations or expansions of existing laws or regulations will not impose requirements on Internet commerce that could substantially impair the growth of e-commerce and adversely affect our business, results of operations or financial condition.

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We expect that Internet technologies and software products and services may be increasingly subject to third-party infringement claims as the number of competitors in our industry segment grows and the functionality of products in different industry segments overlaps.

Our ability to

compete depends upon our proprietary systems and technology.

Our ability to compete depends upon our proprietary systems and technology.

While we rely on intellectual property laws, confidentiality agreements and technical measures to protect our proprietary rights, we believe that the technical and creative skills of our personnel, continued development of our proprietary systems and technology, brand name recognition and reliable website maintenance are essential in establishing and maintaining a leadership position and strengthening our brands.

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General Risks

We have a limited history of operating with a virtual first workforce and the long-term impact on our financial results and business operations is uncertain.

We are a virtual first workforce with a limited history of operating in this environment.

Although we anticipate that our shift to a virtual first work model will have a long-term positive impact on our financial results and business operations, the impact remains uncertain.

Additionally, there is no guarantee that we will realize any anticipated benefits to our business, including any cost savings, operational efficiencies or productivity.

Our virtual first business model could make it increasingly difficult to manage our business and adequately oversee our employees and business functions, potentially resulting in harm to our company culture, increased employee attrition and the loss of key employees.

We may also experience an increased risk of privacy and data security breaches involving our data.

Any of these factors could adversely affect our financial condition and operating results.

Our ability to operate effectively could be impaired if we fail to attract and retain our key employees.

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In February 2025, our Board of Directors authorized a share repurchase program to acquire up to $250.0 million of our common stock over a three-year period.

Under the share repurchase program, Cars Commerce can repurchase shares from time to time in open market transactions or through privately negotiated transactions in accordance with applicable federal securities laws and regulations.

The timing and amounts of any purchases under the share repurchase program is dependent upon a variety of factors, including market conditions, price, regulatory requirements and other corporate considerations, as determined by Cars Commerce’s Board of Directors and management.

Under the share repurchase program, we can repurchase shares from time to time in open market transactions or through privately negotiated transactions in accordance with applicable federal securities laws and regulations.

As of February 23, 2026, we repurchased approximately $76.2 million of our common stock under the current program.

The timing and amounts of any future purchases under the share repurchase program is dependent upon a variety of factors, including market conditions, price, regulatory requirements and other corporate considerations, as determined by our Board of Directors and management.

The share repurchase program may be extended, suspended or discontinued at any time.

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Your percentage of ownership in the Company may be diluted in the future.

In the future, your percentage ownership in Cars Commerce may be diluted because of equity awards that we will be granting to our directors, officers and employees or otherwise as a result of equity issuances for acquisitions or capital market transactions.

Such awards will have a dilutive effect on our earnings per share, which could adversely affect the market price of our common stock.

In the future, your percentage ownership in the Company may be diluted because of equity awards that we will be granting to our directors, officers and employees or otherwise as a result of equity issuances for acquisitions or capital market transactions.

Such awards will have a dilutive effect on our net income per share, which could adversely affect the market price of our common stock.

In addition, our Amended and Restated Certificate of Incorporation authorizes us to issue, without the approval of our stockholders, one or more classes or series of preferred stock that have such designation, powers, preferences and other relative, participating, optional and special rights, including preferences over our common stock with respect to dividends and distributions, as our Board of Directors generally may determine.

The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the value of our common stock.

The terms of one or more classes or series of preferred stock could dilute the voting power or reduce the value

of our common stock.

Similarly, the repurchase or redemption rights or liquidation preferences we could assign to holders of preferred stock could affect the residual value of the common stock.

Certain provisions of our Amended and Restated Certificate of Incorporation, By-laws and Delaware law may discourage takeovers and limit our ability to use, acquire, or develop certain competing businesses.

Our Amended and Restated Certificate of Incorporation and Amended and Restated By-laws contain certain provisions that may discourage, delay or prevent a change in our management or control over Cars Commerce.

For example, our Amended and Restated Certificate of Incorporation and Amended and Restated By-laws, collectively:

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any action asserting a claim for or based on a breach of a fiduciary duty owed by any of our current or former directors or officers to us or to our stockholders, including a claim alleging the aiding and abetting of such a breach of fiduciary duty;

any action asserting a claim against us or any of our current or former directors or officers arising pursuant to any provision of the Delaware General Corporation Law (the "DGCL") or our Amended and Restated Certificate of Incorporation or Bylaws;

any action asserting a claim relating to or involving us that is governed by the internal affairs doctrine;

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Additionally, if individuals are elected to our Board of Directors with a specific agenda, it may adversely affect our ability to effectively implement our strategic plan and create additional value for our stockholders.

Further, perceived uncertainties as to our future direction, including uncertainties related to the composition of our Board of Directors, may lead to the perception of instability or a change in the direction of our business, which may be exploited by our competitors, cause concern to current or potential customers, result in the loss of potential business opportunities, make it more difficult to attract and retain qualified employees and/or affect our relationships with vendors, customers and other third parties.

Further, perceived uncertainties as to our future direction, including uncertainties related to the composition of our Board of Directors, may lead to the

perception of instability or a change in the direction of our business, which may be exploited by our competitors, cause concern to current or potential customers, result in the loss of potential business opportunities, make it more difficult to attract and retain qualified employees and/or affect our relationships with vendors, customers and other third parties.

Moreover, a proxy contest could cause significant fluctuations in the price of our common stock based on temporary or speculative market perceptions or other factors that do not necessarily reflect the underlying fundamentals and prospects of our business.

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Also, in spite of the limitations in our credit agreement, we may still incur significantly more debt, which could intensify the risks described above on our business, results and financial condition.

For more information, see Note 7 (Debt) to the accompanying

Consolidated Financial Statements included in Part II, Item 8., "Financial Statements and Supplementary Data" of this Annual Report on Form 10-K.

For more information, see Note 6 (Debt) to the accompanying Consolidated Financial Statements included in Part II, Item 8., "Financial Statements and Supplementary Data" of this Annual Report on Form 10-K.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors