CarParts.com losses mount as company weighs future options

Shares of CarParts.com (NASDAQ:PRTS) are expected to open with a loss on Wednesday after the company slipped further into the red and missed Wall Street’s expectations.

During the second quarter, the online auto parts retailer’s second quarter results improved from the prior quarter, and although the full impact of the company’s strategic initiatives isn’t reflected in the quarterly results, the company reached positive EBITDA for the month of June, “underscoring that efforts are beginning to deliver tangible results.”

“A lot of the work is happening behind the scenes and we expect these efforts to generate approximately $10M in annualized cost savings,” said CEO David Meniane.

To that end, the company said it remains “fully engaged” in the process of exploring strategic alternatives to maximize value, including a potential sale. Accordingly, the company is not providing FY25 guidance.

For the most recent quarter, the company’s profits eroded due to the impact of tariffs and product mix while transportation costs remained unchanged. This resulted in an unadjusted loss of $0.23 per share, widening from a loss of $0.15 a year ago and $0.11 worse than expected. Adjusted EBITDA loss also widened to $3.1M from a loss of $100K in the same quarter last year. Combined with a ~10% increase in operating expenses, gross margin declined by 70 basis points to 32.8%. Sales were up, however, by 5% to $151.9M, but missed expectations by $1.51M.

Shares are down 9% in premarket trading.