On March 25, 2025, CarParts.com Inc (PRTS, Financial) released its 8-K filing detailing the financial results for the fiscal year ended December 28, 2024. CarParts.com Inc, a leading eCommerce provider of automotive parts and accessories, reported a challenging year with a significant decline in net sales and increased net losses.
Company Overview
CarParts.com Inc is an online provider of automotive aftermarket parts and repair information, serving as an end-to-end solution for automotive repair and maintenance resources. The company primarily sells its products to individual consumers through its network of websites and online marketplaces, offering collision parts, engine parts, and performance parts and accessories.
Performance and Challenges
For fiscal year 2024, CarParts.com Inc reported net sales of $588.8 million, a 13% decrease from $675.7 million in fiscal year 2023. This decline was primarily driven by soft consumer demand and pressures in the lighting and mirrors segment due to the influx of non-compliant illegal parts. The company's gross profit also fell to $196.7 million from $229.4 million, with a gross margin of 33.4%.
The economic environment posed significant challenges, particularly for lower-income consumers, leading to reduced spending and deferred auto repairs. These factors contributed to a net loss of $40.6 million, or $0.71 per share, compared to a net loss of $8.2 million, or $0.15 per share, in the previous year.
Financial Achievements and Industry Context
Despite the challenges, CarParts.com Inc maintained a cash balance of $36.4 million with no revolver debt, highlighting its financial resilience. The company's mobile app also saw significant growth, with cumulative net downloads exceeding 800,000, more than doubling from the beginning of the year. These achievements are crucial for maintaining competitiveness in the Vehicles & Parts industry, where digital transformation and customer engagement are key drivers of success.
Key Financial Metrics
In the fourth quarter of 2024, net sales were $133.5 million, down 15% from the year-ago quarter. The gross profit for the quarter was $43.4 million, with a gross margin of 32.5%. Operating expenses increased slightly to $58.9 million, resulting in a net loss of $15.4 million for the quarter.
Adjusted EBITDA for fiscal year 2024 was negative $7.1 million, a significant decline from $19.7 million in fiscal year 2023. This metric is important as it provides insight into the company's operational performance by excluding non-recurring expenses and non-cash items.
“2024 was an important year in the ongoing transformation of CarParts.com. We began the year by refocusing our strategy on driving gross and net margin, accelerating efficiency, and achieving sustainable growth,” said David Meniane, CEO.
Analysis and Outlook
CarParts.com Inc's performance in fiscal year 2024 reflects the broader economic challenges faced by the automotive aftermarket industry. The company's strategic focus on enhancing site conversion, strengthening SEO, and expanding its product assortment aims to improve profitability and drive long-term growth. However, the significant decline in net sales and increased net losses highlight the need for continued adaptation to market conditions.
As the company evaluates strategic alternatives in response to inbound interest, it has opted not to provide guidance for 2025. This decision underscores the uncertainty in the current economic climate and the company's commitment to exploring opportunities for growth and improvement.
Explore the complete 8-K earnings release (here) from CarParts.com Inc for further details.
